RNS No 3037h
FENNER PLC
12th November 1997
Contact: Colin Cooke
Chairman
Mark Abrahams
Chief Executive
Telephone: 0171 282 8000 until 12.00pm
Thereafter: 01482 668111
Fenner PLC
Preliminary Results for the year ended 31 August 1997
Financial Highlights
1997 1996
#000 #000
Turnover 266,663 258,603
Operating profit before
exceptional items 23,035 20,173
Capital expenditure 18,812 10,334
Earnings per share
- before exceptional items 14.73p 12.93p
- after exceptional items 12.22p 5.59p
Dividends per share 5.30p 5.00p
* Results highlight year of record profits, increased
dividends, strong balance sheet and profitable
investment;
* Organic investment programmes, coupled with strategic
acquisitions strongly position the Group in growth areas;
* Confident outlook for the future.
Extracts From The
Chairman's Statement
A year of record profits, increased dividends,
strong financing and profitable investment. Growth
of our reinforced polymers businesses is continuing
and our outlook is confident.
Turnover, profits and dividends
Following my letter to shareholders in May indicating improved
performance, I am once again pleased to be able to make my
report for the full year against a background of achievement
and improvement throughout our operations. 1996/7 has been
characterised by both organic growth and acquisition on a
scale which repositions the Group and which enhances its
prospects for future development.
Despite currency translation impacts and the disposal of non-
core operations, the Group's turnover increased to #267m (1996
#259m) with a particularly notable performance being achieved
by the enlarged Conveyor Belting Division. Group operating
profit before acquisition restructuring costs increased by 14%
to #23.0m (1996 #20.2m) which represents a record achievement
for the Group.
Group profit before tax increased by 48% to #18.5m (1996
#12.5m), the highest in the Group's history. After tax and
minority interests this leaves pre exceptional earnings per
share at 14.73p representing an increase over 1996 of 14%.
Against this background of continued improvement, the Board is
recommending a final dividend of 3.50p (1996 3.30p), which,
when taken together with the interim dividend of 1.80p (1996
1.70p) gives a total for the year of 5.30p (1996 5.00p) and
maintains our dividend cover at in excess of two times.
Gearing
The acquisition of Scandura for #46.7m (including debt
assumed) was financed through #13m of new equity and the
remainder from the raising of U.S.$75m of 10 year, fixed rate
debt from the U.S. Private Placement market. This, together
with goodwill write-offs, has increased our gearing to 60% at
the year end. Although higher than recent levels experienced
by the Group, our interest cover for the current year is
expected to remain firmly within acceptable levels.
Record levels of investment
Significant organic investment programmes have continued
during the year to strengthen our technology in the reinforced
polymer businesses (Advanced Engineered Products and Conveyor
Belting).
Taken together with our corporate acquisitions, most notably
that of Scandura Holdings Inc., our total capital investment
in operating activities for the year was a record #71.6m.
Divisional trading
The performances of those of our divisions in which we have
invested heavily over the past three years continue to justify
our confidence in the future direction of our reinforced
polymer businesses. Both our Conveyor Belting and Advanced
Engineered Products Divisions are bringing a sharper focus to
our Group as their respective performance grows in terms of
both turnover and profitability.
The success of our reinforced polymer businesses has been
complemented by another year of satisfactory trading from our
Fluid Power and Power Transmission Divisions.
Return
Turnover on sales
Year ended 31 August 1997 #m %
Advanced Engineered Products 61.9 13.5
Conveyor Belting 56.8 10.2
Fluid Power 46.2 10.0
Power Transmission 105.4 6.5
Inter-segment sales (3.6) -
=====
266.7
=====
Following the Scandura acquisition in June this year the
reinforced polymer businesses now account for over half of
Group turnover and two thirds of Group operating profit.
Outlook
The new year has started with performances in all our
operations continuing in line with expectations. Some of our
markets are still experiencing slower growth although the
buoyancy in North America appears to be continuing. UK mining
demand levels in the immediate future are not yet certain. We
believe, however, that the global spread of the Conveyor
Belting Division will enable us to meet our growth objectives.
The Group's businesses have continued to show the degree of
resilience and progress consistent with both our position in
our chosen markets and the manufacturing and technical
expertise associated with our products.
Taking the Group as a whole, we look forward to the rest of
the year with confidence.
Colin Cooke Chairman
Group Profit and Loss Account
for the financial year ended 31 August 1997
1997 1996
Before Excep- Before Excep-
excep- tional excep- tional
tional items tional items
items (note3) Total items(note3) Total
Note #000 #000 #000 #000 #000 #000
Turnover
Continuing
operations 246,661 -246,661 258,603 - 258,603
Acquisitions 20,002 - 20,002 - - -
----- ----- ----- ------ ----- -----
2266,663 -266,663 258,603 - 258,603
Cost of
sales (179,169)(1,202)(180,371)(171,077)(4,604)(175,681)
----- ----- ----- ------ ----- -----
Gross profit 87,494 (1,202) 86,292 87,526 (4,604) 82,922
Distribution
costs (36,263) (233)(36,496)(37,613) (268)(37,881)
Administrative
expenses (28,196)(1,551)(29,747)(29,740)(1,261)(31,001)
----- ----- ----- ------ ----- -----
Operating
profit
Continuing
operations 21,652 - 21,652 20,173 (6,133) 14,040
Acquisitions 1,383 (2,986) (1,603) - - -
----- ----- ------ -----
2 23,035 (2,986) 20,049 20,173(6,133) 14,040
====== ====== ====== ======
Income from
interest in
associated
undertaking 654 546
Loss on sale and
termination of
operations 4 (20) (850)
----- -----
Profit on ordinary
activities before
interest 20,683 13,736
Interest payable
less receivable (2,173) (1,258)
----- -----
Profit on ordinary
activities before
taxation 18,510 12,478
Taxation on
profit on
ordinary
activities 5 (6,309) (6,664)
----- -----
Profit on ordinary
activities after
taxation 12,201 5,814
Minority equity
interests (607) (641)
----- -----
Profit for
the year 11,594 5,173
Dividends 6 (5,251) (4,637)
----- -----
Retained profit for
the year 6,343 536
====== ======
Retained by
Fenner PLC and
subsidiary
undertakings 6,012 237
Associated
undertaking 331 299
----- -----
6,343 536
===== =====
Earnings per
share
Before exceptional
items 7 14.73p 12.93p
====== ======
After exceptional
items 7 12.22p 5.59p
====== ======
The sale and termination of operations during the year have
not had a material effect on the nature and focus of the
Group. As a result, the turnover and operating profit noted
above are reported as deriving solely from continuing
operations.
Group Balance Sheet
at 31 August 1997
1997 1996
#000 #000
Fixed assets
Intangible assets 64 71
Tangible assets 73,631 49,442
Investments 3,555 3,373
----- -----
77,250 52,886
----- -----
Current assets
Stocks 59,660 52,902
Debtors 70,475 51,185
Cash at bank and in hand 54,593 45,709
----- -----
184,728 149,796
Creditors - Amounts falling due
within one year (86,493) (67,810)
----- -----
Net current assets 98,235 81,986
----- -----
Total assets less current
liabilities 175,485 134,872
Creditors - Amounts falling due after
more than one year (87,823) (39,475)
Provisions for liabilities
and charges (16,623) (13,762)
----- -----
Net assets 71,039 81,635
===== =====
Capital and reserves
Called up share capital 25,555 23,188
Share premium account 249 148
Revaluation reserve 6,960 8,145
Other reserve 1,716 20,958
Profit and loss account 30,294 24,271
Associated undertaking 2,383 2,177
----- -----
Shareholders' funds
- Equity Interest 67,157 78,887
Minority equity interests 3,882 2,748
----- -----
Total funds employed 71,039 81,635
====== ======
Group Cash Flow Statement
for the financial year ended 31 August 1997
1997 1996
#000 #000 #000 #000
Operating activities 23,395 18,603
Returns on investments and
servicing of finance
Interest received 2,008 1,443
Interest paid (4,014) (1,715)
Interest element of finance
lease rental payments (26) (39)
Dividend received from
associated undertaking 87 86
Dividends paid to minority
shareholders (270) (285)
----- -----
Net cash outflow from returns
on investments and servicing
of finance (2,215) (510)
Taxation (6,661) (5,724)
Capital expenditure
Purchase of tangible fixed
assets (net of grant
receipts) (18,812) (10,334)
Sale of tangible fixed
assets 830 727
----- ------
Net cash outflow on
capital expenditure (17,982) (9,607)
Acquisitions and disposals
Purchase of subsidiary
undertakings (40,248) (5,505)
Sale of subsidiary
undertakings 6,137 870
----- ------
Net cash outflow on
acquisitions and disposals (34,111) (4,635)
Equity dividends paid (4,734) (4,348)
Financing
Issue of ordinary share
capital 149 234
Finance lease repayments (139) (158)
Repayment of long and medium
term borrowings (3,026) (18,623)
New long and medium term
borrowings 52,308 41,693
----- -----
Net cash inflow from
financing 49,292 23,146
----- -----
Increase in net cash 6,984 16,925
===== =====
Reconciliation of Net Debt
for the financial year ended 31 August 1997
1997 1996
#000 #000
Increase in net cash 6,984 16,925
Increase in loans and
finance leases (49,143) (22,912)
----- -----
Increase in net debt resulting
from cash flows (42,159) (5,987)
Loans and finance leases
acquired with subsidiaries (581) -
Inception of finance leases (7) (16)
Effect of foreign exchange
rate changes 3,940 (321)
----- -----
Increase in net debt (38,807) (6,324)
Opening net debt (1,533) 4,791
----- -----
Closing net debt (40,340) (1,533)
===== =====
Gearing (Closing net debt/
Shareholders' funds) 60.1% 1.9%
===== =====
Reconciliation of Movements in Shareholders' Funds
for the financial year ended 31 August 1997
1997 1996
#000 #000
1 September 1996 78,887 86,478
Profit for the year 11,594 5,173
Dividends (5,251) (4,637)
New share capital subscribed 12,796 234
Goodwill written off (29,491) (5,750)
Goodwill written back on
disposal of subsidiaries (79) 121
Unrealised deficit on
revaluation of properties (139) (662)
Currency translation differences
on foreign currency net investments (1,160) (2,070)
----- -----
Net reduction in
shareholders' funds (11,730) (7,591)
----- -----
31 August 1997 67,157 78,887
===== =====
Notes
1. Basis of preparation
The preliminary announcement, which was approved by the
Board on 12 November 1997, has been prepared on the basis of
the accounting policies as set out in the 1996 Annual Report.
The profit and loss account, balance sheet and cash flow
statement are abridged from the Group's full accounts on which
the auditors, Price Waterhouse, have given an unqualified
opinion which did not include a statement under section 237(2)
or 237(3) of the Companies Act 1985. The statutory accounts
will be filed with the Registrar of Companies in due course.
2. Segmental information
Operating
profit before
Turnover exceptional items
1997 1996 1997 1996
#000 #000 #000 #000
Advanced Engineered Products 61,853 66,053 8,370 8,261
Conveyor Belting 56,826 40,197 5,775 3,050
Fluid Power 46,198 47,270 4,640 4,018
Power Transmission 105,428 112,724 6,801 7,351
Common costs - -(2,551) (2,507)
Inter-segment sales (3,642) (7,641) - -
----- ----- ----- -----
266,663 258,603 23,035 20,173
----- ----- ----- -----
3. Exceptional items
1997 1996
#000 #000
Restructuring and relocation of
the UK polymer businesses
following the acquisition of
W A Thatcher Limited and
Cromwell Rubber Company Limited - 5,133
Global restructuring of the
Conveyor Belting Division
following the acquisition of
Scandura Holdings Inc. 2,986 -
Restructuring of the UK conveyor
belting business following
the acquisition of the conveyor
belting business of T&N PLC - 1,000
----- -----
2,986 6,133
===== =====
The exceptional charge principally comprises #1,243,000 of
asset write-down, demolition and related costs, and #1,050,000
of plant and personnel relocation costs. Whilst the costs of
the restructuring will impact several of the Conveyor Belting
Division's operations, the full cost has been allocated to
Acquisitions on the basis that the restructuring results from
a review of the Division's global operations arising as a
direct consequence of the integration of the acquisition of
Scandura Inc.
The tax credit in respect of exceptional items amounts to
#418,000 (1996 #125,000).
4. Loss on sale and termination of operations
Loss on termination of non-core
manufacturing operations 1,622 726
Profit on sale of operations (1,602) 124
----- -----
20 850
===== =====
The tax credit in respect of the loss on sale and termination
of operations amounts to #202,000 (1996 #75,000).
5. Taxation on profit on ordinary activities
1997 1996
#000 #000
The charge based on the profit for
the year comprises
United Kingdom 1,553 1,193
Overseas 4,756 5,471
------ ------
6,309 6,664
====== ======
6. Dividends
1997 1996
#000 #000
Ordinary shares
Dividend paid - interim
1.80p (1996 1.70p) 1,673 1,576
Dividend proposed - final
3.50p (1996 3.30p) 3,578 3,061
----- -----
5,251 4,637
====== ======
If approved, the final dividend of 3.50p per share (1996
3.30p) will be paid on 19 January 1998 to shareholders on the
register on 12 December 1997. The interim dividend was paid,
and it is intended that the final dividend will be paid, as a
Foreign Income Dividend. UK income tax at the lower rate is
deemed to have been paid in respect of these dividends but
will not be recoverable by the shareholders.
7. Earnings per share
In view of the significance of the exceptional costs and loss
on sale and termination of operations in the year ended 31
August 1997, the directors consider it appropriate to disclose
earnings per share calculated both before and after these
items.
Profit on ordinary activities
attributable to Fenner PLC 11,594 5,173
Exceptional items plus
loss on sale and termination
of operations 3,006 6,983
Attributable taxation (620) (200)
----- -----
Earnings for the year before
exceptional items and loss on sale
and termination of operations 13,980 11,956
====== ======
Number Number
Weighted average number of
ordinary shares in issue
during the year 94,876,504 92,471,852
Earnings per share Pence Pence
Before exceptional items 14.73 12.93
After exceptional items 12.22 5.59
====== ======
END
FR FFFFWFUWUFSF
Fenner (LSE:FENR)
過去 株価チャート
から 6 2024 まで 7 2024
Fenner (LSE:FENR)
過去 株価チャート
から 7 2023 まで 7 2024
