TIDMHNN
RNS Number : 3793Q
Norman Hay PLC
09 April 2009
PRESS RELEASE
FOR IMMEDIATE RELEASE
9 APRIL 2009
Norman Hay plc
Preliminary Results for the year ended 31 December 2008
Norman Hay plc today announces preliminary results for the year ended 31
December 2008.
FINANCIAL HIGHLIGHTS
* Pre-tax profits increased to GBP2.4m (2007: GBP2.3m)
* Turnover up to GBP27m (2007: GBP24m)
* Final dividend for the year of 2.0p making the total for the full year 4.0p
(2007: 4.4p)
CHAIRMAN'S STATEMENT
I am pleased to announce that the Norman Hay Group achieved a pre-tax profit for
2008 of GBP2.4m on a turnover of GBP27m.
These results include foreign exchange gains and the sale of the BK freehold
site, which we previously announced in April 2008.
Our strong performance in the first half of the year slowed down significantly
in the second half, as the effects of the global financial crisis impacted many
of our customers from mid September onwards.
Your Board is continuing to respond to the fast changing economic environment by
ensuring that all efforts are targeted on our most significant sales
opportunities whilst introducing further cost controls across the Group.
Our position is strengthened in these difficult trading conditions by our focus
on three very different markets worldwide, providing specialist chemical
products for the Automotive, Construction and Oil & Gas industries.
The strategic move into specialist chemical products has brought global sales
opportunities -
especially in the Asia-Pacific region - reducing our
exposure to the worsening business climate in the UK, particularly in the
automotive sector.
This diversification has brought balance to our global customer base and seen
our international revenues increase to 48% of total Group sales.
Dividends
Your Directors recommend a final dividend for the year of 2.0p (2007: 2.6p)
making the total for the full year 4.0p (2007: 4.4p), a small reduction in these
difficult times.
If approved at the Annual General Meeting to be held on 24 June 2009, the
dividend will be paid on 31 July 2009 to shareholders on the register on 26 June
2009.
Business Overview
The Group comprises three main chemical divisions:
"Armourcote" - Surface Coatings
In order to be able to offer the full range of Armourcote specialised coatings
to our global Oil & Gas customer base, we have expanded Hi-Tech Coatings in
Perth, Western Australia and opened a brand new facility in Port Klang,
Malaysia.
The integration of new processes into the existing business in Perth proved
immediately profitable.
The new start-up operation in Malaysia, which has made
losses in the period to date, is expected to move into profit in the second half
of 2009.
There has been significant pressure on margins in our UK sub-contract surface
coatings and treatment businesses. In order to mitigate the effects of this
pressure, we acquired Advanced Surface Treatments Limited, another
Coventry-based operation, and have centralised all zinc and alloy electroplating
on to one site.
"Ultraseal" - Automotive Sealants
2008 proved to be a strong year in terms of sales and profitability despite the
well documented downturn of the global automotive sector in the last quarter of
the year.
Ultraseal International delivered and installed 25 new process plants during the
year in Europe and Asia. Manufactured at their bases in the UK, India and China,
these plants will further expand the global customer base for their consumable
chemicals in the coming year.
New and developing markets returned positive and real growth whilst the
traditional territories also held up well.
The ongoing international economic situation is naturally of concern and we have
modified our short term objectives and focus to minimise the impact of this
situation on what is a specialised and niche global business.
"TAM International" - Construction Chemicals
Sales from the TAM International Group grew strongly in the last 12 months as we
continue to invest in its global infrastructure.
TAM's new Tunnelling & Mining division has been formed to operate primarily in
the Asia-Pacific region and is supported by our new Taiwanese operation,
whichmanufactures the specialised construction chemicals and additives required
for this important industry sector.
The start-up costs of these new operations have impacted TAM's overall results
and, whilst this will continue during the second quarter of 2009, we believe
that these businesses will considerably benefit the future strength of the
Group.
"Norman Hay Engineering" - Chemical Engineering
Our engineering business continues to perform well and profitably in its
increasingly global market.
Designing and manufacturing our own range of chemical process plants supports
the three main chemical divisions of the Group.
The bespoke systems include metal finishing plants, extraction, pollution
control equipment, vacuum impregnation and non-destructive testing equipment.
Staff
On behalf of the Board and our shareholders, I would like to thank all of the
Group's staff for their consistent hard work, loyalty and commitment to the
Group.
Working, as we do, in these challenging times I am confident that they will
continue to deliver excellent service to our customers.
We have, inevitably, had to lose some of our staff as we continuously scale
our businesses in line with the changing operating and economic environment.
That is not a decision easily taken and the necessity of it is regretted by us
all.
Outlook
The turmoil in the financial markets is pushing many industrialised nations
in to recession and it
is difficult to evaluate exactly how this will impact
our businesses in 2009.
Despite being well structured to weather the storm, economic weakness in our
main markets has significantly affected our trading in the first quarter of this
year.
Many Governments around the world are investing, or planning to invest, in
major civil engineering and infrastructure projects as a way of combating the
downturn. This will help to bolster the global construction industry and, in due
course, our construction chemicals and engineering businesses should benefit.
So far this year we have set up new operations in Indonesia and India to
complement those set up in 2008 in Taiwan and Malaysia. Inevitably these new
businesses put a strain on resources during their start up periods, but they
will form part of the bedrock of our future growth when normal trading
conditions return.
In March 2009 we moved the TAM UK operation from Daventry to our Coventry site
in order to optimise resources and pool its manufacturing facilities with those
of Ultraseal International.
In the same month Norman Hay Engineering secured a major GBP4m contract for an
aerospace process facility to be installed in the Kingdom of Saudi Arabia.
This, together with the measures that we have taken, and continue to take, to
maximise efficiencies, minimise operating costs and refocus our markets will
stand the Group in good stead to come through this current period of economic
turmoil.
We expect trading to improve in the second quarter as some of our customers will
need to re-stock and this trend should continue into the second half of this
year.
Peter L Hay
Chairman
9 April 2009
Further information:
Vic BellantiTel: 024 7622 9373
Norman Hay plc
David Haggie/Juliet Tilley Tel: 020 7417 8989
Haggie Financial
Andrew Kitchingman
Brewin Dolphin Investment Banking (Nomad) Tel: 0845 270 8610
Notes to Editors
About Norman Hay plc
Norman Hay plc is a global provider of specialist chemicals & systems. Its
operations are divided in to three primary divisions and brands: Armourcote
(surface coatings), Ultraseal (automotive sealants) and TAM International
(construction chemicals). It is listed on the Alternative Investment Market of
the London Stock Exchange under the ticker symbol HNN.
Unaudited consolidated income statement for the year ended 31 December 2008
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| | | 2008 | | | 2007 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | GBP000 | | | GBP000 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Revenue | | 27,001 | | | 23,959 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Cost of sales | | (17,175) | | | (15,327) |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Gross profit | | 9,826 | | | 8,632 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Distribution expenses | | (1,036) | | | (631) |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Administrative expenses | | (6,857) | | | (5,749) |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Other income | | 497 | | | 143 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Profit from operations | | 2,430 | | | 2,395 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Finance income | | 139 | | | 190 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Finance costs | | (206) | | | (243) |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Profit before taxation | 2,363 | | | 2,342 |
+------------------------------------------------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Taxation | | (810) | | | (672) |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Profit after taxation | 1,553 | | | 1,670 |
+------------------------------------------------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Attributable to : | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Equity holders of the parent | | 1,562 | | | 1,637 |
+-------------------------------------+----------+------------+-----+------+----------+
| Minority interest | | (9) | | | 33 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | 1,553 | | | 1,670 |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Basic earnings per share | | 10.7p | | | 11.4p |
+-------------------------------------+----------+------------+-----+------+----------+
| | | | | | |
+-------------------------------------+----------+------------+-----+------+----------+
| Diluted earnings per share | | 10.4p | | | 10.9p |
+-------------------------------------+----------+------------+-----+------+----------+
Unaudited consolidated balance sheet at 31 December 2008
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| | | 2008 | | 2007 |
+--------------------------------------+-----------+----------+-----------+----------+
| | GBP000 | GBP000 | GBP000 | GBP000 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Assets | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Non-current Assets | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Intangible Assets | 2,952 | | 2,437 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Property, plant and equipment | 5,837 | | 4,633 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Investments | 26 | | 26 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Other receivables | - | | 72 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total non-current assets | | 8,815 | | 7,168 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Current Assets | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Inventories | 2,846 | | 1,795 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Trade and other receivables | 7,206 | | 6,774 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Cash and cash equivalents | 1,015 | | 801 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Assets held for sale | - | | 271 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total current assets | | 11,067 | | 9,641 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total Assets | | 19,882 | | 16,809 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Liabilities | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Current liabilities | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Other financial liabilities | 512 | | 659 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Trade and other payables | 4,380 | | 3,870 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Provisions | 114 | | 142 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Current tax liabilities | 653 | | 682 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total current liabilities | | 5,659 | | 5,353 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Non-current liabilities | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Other financial liabilities | 2,000 | | 1,331 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Trade and other payables | 21 | | - | |
+--------------------------------------+-----------+----------+-----------+----------+
| Deferred tax liabilities | 422 | | 144 | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total non-current liabilities | | 2,443 | | 1,475 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Total liabilities | | 8,102 | | 6,828 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Net assets | | 11,780 | | 9,981 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Equity | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Share capital | | 1,481 | | 1,481 |
+--------------------------------------+-----------+----------+-----------+----------+
| Share premium account | | 1,254 | | 1,254 |
+--------------------------------------+-----------+----------+-----------+----------+
| Capital redemption reserve | | 94 | | 94 |
+--------------------------------------+-----------+----------+-----------+----------+
| Other non-distributable reserve | | 766 | | 766 |
+--------------------------------------+-----------+----------+-----------+----------+
| Reserve for own shares | | (322) | | (322) |
+--------------------------------------+-----------+----------+-----------+----------+
| Share scheme reserve | | 43 | | 26 |
+--------------------------------------+-----------+----------+-----------+----------+
| Foreign exchange reserve | | 772 | | 36 |
+--------------------------------------+-----------+----------+-----------+----------+
| Retained earnings | | 7,372 | | 6,475 |
+--------------------------------------+-----------+----------+-----------+----------+
+--------------------------------------+-----------+----------+-----------+----------+
| Equity attributable to equity | | 11,460 | | 9,810 |
| holders of the parent company | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
| Minority Interest | | 320 | | 171 |
+--------------------------------------+-----------+----------+-----------+----------+
| Total equity | | 11,780 | | 9,981 |
+--------------------------------------+-----------+----------+-----------+----------+
| | | | | |
+--------------------------------------+-----------+----------+-----------+----------+
Unaudited consolidated cash flow statement for the year ended 31 December 2008
+------------------------------------------------------------+----------+----------+
| | 2008 | 2007 |
+------------------------------------------------------------+----------+----------+
| Cash flows from operating activities | GBP000 | GBP000 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Profit from operations | 2,430 | 2,395 |
+------------------------------------------------------------+----------+----------+
| Release of negative goodwill | (231) | - |
+------------------------------------------------------------+----------+----------+
| Impairment of intangibles | - | 15 |
+------------------------------------------------------------+----------+----------+
| Depreciation | 566 | 383 |
+------------------------------------------------------------+----------+----------+
| (Profit)/loss on sale of property, plant and equipment | (378) | 38 |
+------------------------------------------------------------+----------+----------+
| Share option charge | 17 | 17 |
+------------------------------------------------------------+----------+----------+
| Increase in inventories | (916) | (515) |
+------------------------------------------------------------+----------+----------+
| Decrease/(increase) in receivables | 148 | (864) |
+------------------------------------------------------------+----------+----------+
| (Decrease)/ increase in payables | (14) | 167 |
+------------------------------------------------------------+----------+----------+
| Exchange movements on working capital | 333 | - |
+------------------------------------------------------------+----------+----------+
| (Decrease)/increase in provisions | (28) | 48 |
+------------------------------------------------------------+----------+----------+
| Finance income | 139 | 190 |
+------------------------------------------------------------+----------+----------+
| Finance costs | (206) | (243) |
+------------------------------------------------------------+----------+----------+
| Tax paid | (781) | (414) |
+------------------------------------------------------------+----------+----------+
| Net cash generated from operating activities | 1,079 | 1,217 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Cash flows from investing activities | | |
+------------------------------------------------------------+----------+----------+
| Acquisition of subsidiaries net of cash acquired | (210) | (383) |
+------------------------------------------------------------+----------+----------+
| Purchase of property, plant and equipment | (1,030) | (847) |
+------------------------------------------------------------+----------+----------+
| Expenditure on intangibles | - | (15) |
+------------------------------------------------------------+----------+----------+
| Proceeds from disposal of property, plant and equipment | 691 | 18 |
+------------------------------------------------------------+----------+----------+
| Net borrowing disposed of with | - | 134 |
| subsidiary undertaking | | |
+------------------------------------------------------------+----------+----------+
| Net cash used in investing activities | (549) | (1,093) |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Cash flows from financing activities | | |
+------------------------------------------------------------+----------+----------+
| Dividends paid to shareholders | (669) | (554) |
+------------------------------------------------------------+----------+----------+
| Net proceeds from issue of ordinary share capital | - | 112 |
+------------------------------------------------------------+----------+----------+
| Payments for purchase of share capital in subsidiary | (26) | - |
+------------------------------------------------------------+----------+----------+
| Net proceeds from issue of share capital to minority | 197 | - |
| shareholders | | |
+------------------------------------------------------------+----------+----------+
| Purchase of long term incentive plan shares | - | (322) |
+------------------------------------------------------------+----------+----------+
| Finance lease repayment | (59) | (31) |
+------------------------------------------------------------+----------+----------+
| New loans raised | 303 | 581 |
+------------------------------------------------------------+----------+----------+
| Repayment of loans | (214) | (546) |
+------------------------------------------------------------+----------+----------+
+------------------------------------------------------------+----------+----------+
| Net cash used in financing activities | (468) | (760) |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Net increase/(decrease) in cash and cash equivalents | 62 | (770) |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Cash and cash equivalents at the beginning of the year | 541 | 1,264 |
+------------------------------------------------------------+----------+----------+
| Effects of foreign exchange rate changes | 224 | 47 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Cash and cash equivalents at the end of the year | 827 | 541 |
+------------------------------------------------------------+----------+----------+
Unaudited consolidated statement of recognised income and expense
+------------------------------------------------------------+----------+----------+
| for the year ended 31 December 2008 | 2008 | 2007 |
+------------------------------------------------------------+----------+----------+
| | GBP000 | GBP000 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Exchange differences on translation of foreign operations | 723 | 75 |
+------------------------------------------------------------+----------+----------+
| Deferred tax movements in respect of share option scheme | 4 | (4) |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Net income recognised directly in equity | 727 | 71 |
+------------------------------------------------------------+----------+----------+
| Profit for the year | 1,553 | 1,670 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Total recognised income and expense for the year | 2,280 | 1,741 |
+------------------------------------------------------------+----------+----------+
+------------------------------------------------------------+----------+----------+
| Attributable to | | |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Equity shareholders | 2,302 | 1,708 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| Minority interests | (22) | 33 |
+------------------------------------------------------------+----------+----------+
| | | |
+------------------------------------------------------------+----------+----------+
| | 2,280 | 1,741 |
+------------------------------------------------------------+----------+----------+
Notes:
1. The calculation of basic earnings per share is based on the profit of
GBP1,562,000 (2007: GBP1,637,000) and on 14,546,000 weighted average ordinary
shares (2007 : 14,400,000) in issue. The calculation of diluted earnings per
share is based on 15,053,000 (2007 : 15,069,000) shares in issue.
2. The financial information set out above has been prepared in accordance
with
the recognition and measurement principles of IFRS as endorsed for use
in the European Union, using the accounting policies that were set out in the
Group's Financial Statements for the year ended 31 December 2007. The Auditors
have consented to the release of this preliminary statement.
3. The financial information set out above does not constitute the Company's
Statutory Financial Statements within the meaning of Section 240 of the
Companies Act 1985. The 2008 figures are based on unaudited financial statements
for the year ended 31 December 2008. The auditors do not expect to issue a
qualified report on the Statutory Financial Statements which will be finalised
on the basis of the financial information presented by the Directors in the
preliminary announcement and which will be delivered to the Registrar of
Companies following the Company's Annual General Meeting.
4. The comparatives for the full year ended 31 December 2007 are based on
the
latest Statutory Financial Statements. They are not the Company's full
Statutory Financial Statements for the year. A copy of the Statutory Financial
Statements for that year has been delivered to the Registrar of Companies. The
auditors' report on those financial statements was unqualified, did not include
references to any matters which the auditors drew attention by way of emphasis
without qualifying their report and did not contain a statement under section
237(2)-(3) of the Companies Act 1985.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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