Interim Results
13 Fevereiro 2003 - 5:02AM
UK Regulatory
RNS Number:4319H
McBride PLC
13 February 2003
Thursday 13 February 2003
McBride plc
Interim Announcement for the Half-Year Ended 31 December 2002
McBride supplies more than 20 million Private Label household and personal care
products every week to Europe's leading retailers.
Highlights of the half-year results are as follows:
* Group turnover was #249.3 million, up 4% on the same period last year.
* Group operating profit was #14.0 million, (#14.7 million before
goodwill amortisation), up 20%.
* Pre tax profit was #11.8 million, up 44%.
* Net debt was #76.6 million at the end of the period, a reduction of
#18.3 million.
* Basic Earnings per share for the half-year were 4.7p, up 42%
* Interim dividend proposed of 0.8p, up 14%.
Mike Handley, Chief Executive, commented:
"These results underline the current favourable market conditions for Private
Label and our ability to serve our customers' needs. We are particularly
pleased with progress in our Continental European business. Our cash flow has
been strong, and we have significantly reduced our net debt. Trading remains in
line with expectations."
For further information please contact:
McBride plc
Mike Handley, Chief Executive 01494 60 70 50
Miles Roberts, Finance Director 01494 60 70 50
Financial Dynamics 020 7831 3113
Andrew Dowler, Fiona Meiklejohn
Highlights of the half-year results:
Overview
* Sales from Continental Europe continued to grow strongly, up 7.1% to
#129.0 million, operating profits improved 22.6% to #6.5 million.
* Sales in the UK rose 1.0% to #120.3 million and tight cost control saw
profits rise 17.2% to #7.5 million.
* Improved working capital management and reduced capital expenditure
levels resulted in a significant reduction in net debt - down
#18.3 million in the six months since June 2002.
Strategy
The Board is committed to a strategy of growing with our customers across
Europe. Our financial objectives include growing sales and profits, improving
the return on capital and reducing debt.
Key Strengths
Two aspects of our competitive edge that stand out are our commitment to
innovation and the skills of our people. We demonstrate innovation in all facets
of our business: product, packaging, manufacturing, logistics, marketing and
information systems. Our specialist expertise in meeting the requirements of
Europe's major retailers sets us apart from our competitors and is well
recognised by our customers. Our competitive advantage stems from our excellent
reputation for service delivery and speed-to-market for new products.
Continental Europe
Our Continental Europe business (McBride CE) sells in all member states of the
European Union in mainland Europe, with its head office located in Belgium and
production sites in five member states. Retailer consolidation led by the French
multiples and some German and Dutch retailers is creating a favourable
environment for Private Label growth in these markets.
Sales from Continental Europe were #129.0 million, up 7.1% on the previous year.
This was a result of significant growth in France, our major market, as well as
Spain and Holland. In the calendar year, the market share for Private Label grew
in France from 10.9% to 11.4%, Spain from 20.7% to 23.2% and the Netherlands
from 15.1% to 15.6%.
Operating profit after goodwill amortisation for the Continental European
business for the half-year was #6.5 million, an increase of #1.2 million on the
previous half-year's result, an improvement of 23%. This result was due to a
combination of higher sales and improved operating efficiency.
United Kingdom
As the result of a strong first quarter due to high levels of promotional
activity, sales from the UK rose #1.2 million to #120.3 million, an increase of
1.0%. This is a satisfying result, given the downward price pressure from
imports, due to the weakness of the Euro, and continued aggressive price
competition between the grocery retailers.
The UK market for Private Label household products grew in value by 7.4%,
compared to 4.4% for the total household market. This resulted in an increase in
the market share of Private Label from 23.6% to 24.1%.
The UK market for Private Label personal care products declined by 5.1% in value
compared to total market growth of 1.3%, while Private Label volume growth was
2.1% against market volume growth of 3.4%.
Operating profit after goodwill amortisation for the UK business was #7.5
million, an increase of #1.1 million on the previous half-year's result. This
improvement was mainly the result of efficiency improvements in manufacturing
and lower stock holding and distribution costs.
International
McBride International has responsibility for all markets outside the EU, with
the majority of its sales in Central & Eastern Europe, the core of which is
Intersilesia in Poland which was acquired in 1998. The business represents
about 7% of Group turnover and comprises exports from both the UK and CE
combined with Intersilesia's own sales.
In Poland, Intersilesia achieved 4% growth in local currency. However, due to
weakness in the Zloty, this represented a reduction in sterling terms. In
Hungary, the Czech Republic and Slovakia, the market is being led by the rapid
development of Western European retailers through a combination of store
building programmes and acquisitions. Our strategy is to support our leading
customers as they expand outside their domestic markets.
Financial Review
Growth in sales, particularly mainland Europe, combined with improved operating
efficiencies raised Group operating profit after goodwill amortisation to #14.0
million (Dec 2001, #11.7 million). EBITDA similarly improved from #21.6 million
to #24.5 million. The Group's pre-tax profit for the half-year increased to
#11.8 million, up 44 % (Dec 2001, #8.2 million).
Interest charges reduced to #2.2 million (Dec 2001, #2.4 million).
Including full provision for deferred taxation under FRS19, the tax charge for
the half-year represents an underlying charge of 28% before goodwill
amortisation. This continues to be below the mainstream rate due to the recovery
of unutilised previously written off ACT. This recovery is expected to continue
for the rest of the year.
The improvement in profitability was accompanied by a very strong cash inflow;
net debt fell from #94.9 million at 30 June 2002 to #76.6 million at 31 December
2002. This reduction in debt is after a small deterioration from exchange
differences and a dividend payment of #1.3 million. Debt fell consistently
through the half-year and into January 2003.
Following significant financial and operational restructuring in June 2002, the
aerosol joint venture (APL) achieved break even at the pre-tax level in the
half-year (Dec 2001, loss of #1.1 million). Overheads and direct costs have been
cut and unprofitable business terminated. Debt within APL has been eliminated
and operating cashflow was strong.
Working capital has improved following continuing initiatives on stock
management and terms of trade.
Capital expenditure was #2.4 million for the period (Dec 2001, #6.0 million).
This lower level of expenditure was influenced by phasing on a number of
projects with an element of catch-up expected in the second half. However, the
drive to improve existing asset utilisation across the group is reducing the
need for new investment.
Earnings and Dividends
Earnings per share, on an undiluted basis, were 4.7 pence, (Dec 2001, 3.3
pence).
An interim dividend of 0.8 pence per share (Dec 2001, 0.7 pence) will be paid on
4 July 2003. Accordingly the ex-dividend date will be 4 June 2003 with a record
date of 6 June 2003.
Current Trading and Outlook
"These results underline the current favourable market conditions for Private
Label and our ability to serve our customers' needs. We are particularly
pleased with progress in our Continental European business. Our cash flow has
been strong, and we have significantly reduced our net debt. Trading remains in
line with expectations."
Independent review report by KPMG Audit Plc to McBride Plc
Introduction
We have been instructed by the Company to review the financial information set
out on pages 5 to 10 and we have read the other information contained in the
interim report and considered whether it contains any apparent misstatements
with the financial information.
This report is made solely to the Company in accordance with the terms of our
engagement letter dated 12th June 2001 to assist the Company in meeting the
requirements of the Listing Rules of the Financial Services Authority and the
proper control of its affairs. Our review has been undertaken so that we might
state to the Company those matters we are required to state by the terms of our
engagement and for no other purpose. To the fullest extent permitted by law, we
do not accept or assume responsibility to anyone other than the company for our
review work, for this report, or for the conclusions we have reached.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules which require that the accounting policies and presentation applied to the
interim figures should be consistent with those applied in preparing the
preceding annual accounts except where they are to be changed in the next annual
accounts in which case any changes, and the reasons for them, are to be
disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/
4: Review of interim financial information issued by the Auditing Practices
Board for use in the United Kingdom. A review consists principally of making
enquiries of Group management and applying analytical procedures to the
financial information and underlying financial data and, based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review is substantially less
in scope than an audit performed in accordance with Auditing Standards and
therefore provides a lower level of assurance than an audit. Accordingly we do
not express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 31 December 2002.
KPMG Audit Plc
Chartered Accountants
8 Salisbury Square
London
EC4Y 8BB
12th February 2003
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Unaudited Unaudited Audited
6 months to 6 months to Total
31 Dec 31 Dec Year ended
2002 2001 30 Jun 2002
Note #m #m #m
Turnover
Continuing operations and share of joint venture 256.8 248.7 500.6
Less: share of joint venture's turnover (7.5) (9.1) (16.6)
________________________________________________ ____ ____________ __________ ____________
Group turnover 1 249.3 239.6 484.0
Cost of sales (149.8) (150.2) (297.6)
________________________________________________ ____ ____________ __________ ____________
Gross profit 99.5 89.4 186.4
Distribution costs (13.4) (12.9) (26.2)
Administrative expenses
Before goodwill amortisation (71.4) (64.1) (134.1)
Goodwill amortisation (0.7) (0.7) (1.3)
(72.1) (64.8) (135.4)
_______________________________________________ ____ ____________ __________ ____________
Group operating profit 14.0 11.7 24.8
Share of joint venture's operating
profit/(loss) before goodwill amortisation 0.2 (0.5) (1.2)
Goodwill amortisation on joint venture - (0.1) (0.3)
________________________________________________ ____ ____________ __________ ____________
Share of joint venture's operating profit/(loss) 0.2 (0.6) (1.5)
_______________________________________________ ____ ____________ __________ ____________
Total operating profit 14.2 11.1 23.3
Write-off of goodwill in joint venture - - (15.8)
________________________________________________ ____ ____________ __________ ____________
Profit on ordinary activities before interest 14.2 11.1 7.5
Group interest receivable and similar income 0.2 0.4 0.6
Group interest payable and similar charges (2.4) (2.8) (5.0)
Share of joint venture's interest payable and similar (0.2) (0.5) (0.9)
charges
_______________________________________________ ____ ____________ __________ ____________
Profit on ordinary activities before taxation 11.8 8.2 2.2
Tax on profit on ordinary activities (3.5) (2.7) (5.6)
Share of joint venture's tax credit on ordinary - 0.4 0.2
activities
________________________________________________ ____ ____________ __________ ____________
Profit/(loss) on ordinary activities after taxation 8.3 5.9 (3.2)
Equity minority interest - (0.1) (0.2)
________________________________________________ ____ ____________ __________ ____________
Profit/(loss) for the period 8.3 5.8 (3.4)
Dividends proposed (equity) (1.4) (1.3) (3.7)
________________________________________________ ____ ____________ __________ ____________
Retained profit/(loss) for the period 6.9 4.5 (7.1)
________________________________________________ ____ ____________ __________ ____________
Earnings per ordinary share (pence)
* Basic 4 4.7 3.3 (1.9)
* Diluted 4.6 3.3 (1.9)
* Basic before operating exceptional items, share
of joint venture and goodwill amortisation 5.1 4.1 9.0
Dividend per share (pence) 0.8 0.7 2.0
CONSOLIDATED BALANCE SHEET
Audited
Unaudited Unaudited Year ended
31 Dec 31 Dec 30 Jun
2002 2001 2002
Note #m #m #m
Fixed assets
Intangible assets 9.7 11.5 10.4
Tangible assets 128.3 136.6 135.4
Investment in joint venture - 4.9 -
_______________________________________________ ______ ___________ ___________ ___________
Total fixed assets 138.0 153.0 145.8
_______________________________________________ ______ ___________ ___________ ___________
Current assets
Stocks 43.9 47.7 46.9
Debtors 108.3 102.4 110.8
Cash at bank and in hand 3.0 1.7 1.2
_______________________________________________ ______ ___________ ___________ ___________
155.2 151.8 158.9
Creditors: amounts falling due within one year (137.5) (135.8) (232.0)
_______________________________________________ ______ ___________ ___________ ___________
Net current assets 17.7 16.0 (73.1)
_______________________________________________ ______ ___________ ___________ ___________
Total assets less current liabilities 155.7 169.0 72.7
Creditors: amounts falling due after more than one year (77.3) (82.6) (2.4)
Provisions for liabilities and charges (4.9) (2.8) (3.9)
Investment in joint venture
Share of gross assets 4.3 5.1 4.3
Share of gross liabilities (6.1) (13.0) (6.1)
_______________________________________________ ______ ___________ ___________ ___________
Net investment in joint venture (1.8) (7.9) (1.8)
_______________________________________________ ______ ___________ ___________ ___________
Net assets 71.7 75.7 64.6
_______________________________________________ ______ ___________ ___________ ___________
Capital and reserves
Called up share capital 17.8 17.8 17.8
Share premium account 139.3 139.3 139.3
Profit and loss account 3 (85.5) (81.6) (92.7)
_______________________________________________ ______ ___________ ___________ ___________
Equity shareholders' funds 71.6 75.5 64.4
Equity minority interest 0.1 0.2 0.2
_______________________________________________ ______ ___________ ___________ ___________
Net assets 71.7 75.7 64.6
_______________________________________________ ______ ___________ ___________ ___________
CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
Note #m #m #m
Net cash flow from operating activities 5 25.8 15.4 42.3
Returns on investments and servicing of finance (2.0) (3.0) (4.8)
Taxation (1.5) (2.1) (5.4)
_____________________________________________ _______ ____________ ___________ ___________
Operating cash flow after taxation and finance costs 22.3 10.3 32.1
Capital expenditure (2.4) (6.0) (10.5)
Cost of refinancing joint venture - - (16.3)
Deferred consideration payments - - 1.0
Equity dividends paid (1.3) - (3.6)
_____________________________________________ _______ ____________ ___________ ___________
Cash flow before financing 18.6 4.3 2.7
Financing (10.6) (9.2) (9.9)
_____________________________________________ _______ ____________ ___________ ___________
Increase/(Decrease) in cash in the period 8.0 (4.9) (7.2)
_____________________________________________ _______ ____________ ___________ ___________
Reconciliation of net cash flow to movement in net debt
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Increase/(Decrease) in cash in the period 8.0 (4.9) (7.2)
Cash outflow from movement in debt and lease financing 10.6 9.2 9.9
_______________________________________________________ ____________ ___________ ___________
Change in net debt resulting from cash flows 18.6 4.3 2.7
Translation differences (0.3) (0.9) (4.4)
_____________________________________________ _______ ____________ ___________ ___________
Movement in net debt in the period 18.3 3.4 (1.7)
Net debt at the beginning of the period (94.9) (93.2) (93.2)
_____________________________________________ _______ ____________ ___________ ___________
Net debt at the end of the period (76.6) (89.8) (94.9)
_____________________________________________ _______ ____________ ___________ ___________
Consolidated statement of total recognised gains and losses
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Profit/(loss) for the period 8.3 5.8 (3.4)
Unrealised foreign currency differences 0.3 - 0.5
__________________________________________ ________ ____ ___________ ___________ ___________
Total recognised gains/(losses) relating to the 8.6 5.8 (2.9)
period
Prior period adjustment - - (5.0)
__________________________________________ ________ ____ ___________ ___________ ___________
Total recognized gains and losses 8.6 5.8 (7.9)
__________________________________________ ________ ____ ___________ ___________ ___________
Reconciliation of movements in shareholders' funds
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Profit/(loss) for the period 8.3 5.8 (3.4)
Equity dividends (1.4) (1.3) (3.7)
__________________________________________ ________ ____ ___________ ___________ ___________
Retained profit/(loss) 6.9 4.5 (7.1)
Unrealised foreign currency differences 0.3 - 0.5
Opening equity shareholders' funds 64.4 71.0 71.0
__________________________________________ ________ ____ ___________ ___________ ___________
Closing shareholders' funds 71.6 75.5 64.4
__________________________________________ ________ ____ ___________ ___________ ___________
Notes to the interim financial statements
1) Segmental information
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Turnover by destination is analysed by geographical area as follows:
Continuing operations
UK 115.0 116.6 228.5
Continental Europe 132.7 120.9 251.3
Rest of world 1.6 2.1 4.2
_______________________________________________ ____________ ____________ ____________
Group turnover 249.3 239.6 484.0
Share of joint venture's turnover 7.5 9.1 16.6
_______________________________________________ ____________ ____________ ____________
Turnover by destination 256.8 248.7 500.6
_______________________________________________ ____________ ____________ ____________
Turnover by geographical origin is analysed as follows:
Continuing operations
UK 120.3 119.1 243.1
Continental Europe 129.0 120.5 240.9
_______________________________________________ ____________ ____________ ____________
Group turnover 249.3 239.6 484.0
Share of joint venture's turnover 7.5 9.1 16.6
_______________________________________________ ____________ ____________ ____________
Turnover by origin 256.8 248.7 500.6
_______________________________________________ ____________ ____________ ____________
Turnover by class of business is analysed as follows:
Continuing operations
Household products 214.0 204.6 415.2
Personal care products 35.3 35.0 68.8
_______________________________________________ ____________ ____________ ____________
Group turnover 249.3 239.6 484.0
Share of joint venture's turnover 7.5 9.1 16.6
_______________________________________________ ____________ ____________ ____________
Total turnover by class of business 256.8 248.7 500.6
Operating profit by geographical origin is analysed as follows:
Continuing operations
UK 7.5 6.4 15.0
Continental Europe 6.5 5.3 9.8
_______________________________________________ ____________ ____________ ____________
Group operating profit 14.0 11.7 24.8
Non operating items - (1.1) (18.2)
Net interest payable (2.2) (2.4) (4.4)
_______________________________________________ ____________ ____________ ____________
Profit on ordinary activities before tax 11.8 8.2 2.2
_______________________________________________ ____________ ____________ ____________
Operating profit by class of business is analysed as
follows:
Continuing operations
Household products 12.2 9.5 21.1
Personal Care products 1.8 2.2 3.7
_______________________________________________ ____________ ____________ ____________
Group operating profit 14.0 11.7 24.8
Non operating items - (1.1) (18.2)
Net interest payable (2.2) (2.4) (4.4)
_______________________________________________ ____________ ____________ ____________
Profit on ordinary activities before tax 11.8 8.2 2.2
_______________________________________________ ____________ ____________ ____________
2) Unaudited half-year results
The results for the half-year ended 31 December 2002 and 31 December 2001 are
unaudited and have been prepared on the basis of accounting policies set out in
the Report and Accounts for the year ended 30 June 2002. The comparative
figures for the year ended 30 June 2002 do not constitute statutory accounts.
The accounts for that period have been reported on by the Company's auditors and
delivered to the Registrar of Companies. The report of the auditors thereon was
unqualified and did not contain a statement under section 237(2) or (3) of the
Companies Act 1985.
3) Profit and loss account
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Goodwill reserve (146.4) (146.4) (146.4)
Profit and loss account 60.9 64.8 53.7
______________________________________________ ___________ ___________ ___________
(85.5) (81.6) (92.7)
______________________________________________ ___________ ___________ ___________
4) Earnings per ordinary share
Earnings per ordinary share is calculated on profit after tax and minority
interests in accordance with FRS 14. The calculation of basic earnings per
ordinary share for all the periods disclosed is based on a weighted average of
177,639,197 ordinary shares of 10 pence each. For the purposes of calculating
the diluted Earnings per share, only potential ordinary shares have been
included in the weighted average of 179,306,409 (2001: 177,639,197).
5) Reconciliation of operating profit to operating cash flow
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
#m #m #m
Group operating profit 14.0 11.7 24.8
Depreciation 9.8 9.2 18.6
Goodwill amortisation 0.7 0.7 1.3
Loss on disposal of fixed assets - - 0.1
Movement in stocks 3.1 1.3 3.3
Movement in debtors 2.9 (3.6) (9.6)
Movement in creditors (4.7) (3.9) 3.8
______________________________________________ ___ ___________ ___________ ___________
Cash flow from operating activities 25.8 15.4 42.3
______________________________________________ ___ __________ ___________ ___________
6) Contingent liabilities
The Group had no material contingent liabilities at 31 December 2002.
Financial calendar for the year ending 30 June 2003
_____________ _____________ _____________ _____________ _____________ _________________
Dividends
_____________ _____________ _____________ _____________ _____________ _________________
Interim Announcement 13 February 2003
Payment 4 July 2003
_____________ _____________ _____________ _____________ _____________ _________________
Final Announcement September 2003
Payment January 2004
_____________ _____________ _____________ _____________ _____________ _________________
Results
_____________ _____________ _____________ _____________ _____________ _________________
Interim Announcement 13 February 2003
Preliminary statement for full year Announcement September 2003
Report and Accounts Circulated September 2003
Annual General Meeting To be held December 2003
____________________________ _____________ _____________ _____________ ____________________
Exchange rates
The exchange rates used for conversion to sterling were as follows:
Unaudited Unaudited Audited
6 months to 6 months to Year ended
31 Dec 2002 31 Dec 2001 30 Jun 2002
Average rate:
Euro 1.57 1.61 1.61
Polish Zloty 6.35 5.98 5.94
Czech Koruna 48.05 54.13 52.05
Hungarian Forint 381.0 405.9 398.7
____________________________ _____________ _____________ _____________ _____________
Closing rate:
Euro 1.53 1.63 1.54
Polish Zloty 6.17 5.75 6.18
Czech Koruna 48.42 51.75 45.08
Hungarian Forint 361.9 399.9 377.8
____________________________ _____________ _____________ _____________ _____________
This information is provided by RNS
The company news service from the London Stock Exchange
END
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