RNS Number:2668Q
Watermark Group PLC
26 September 2003
For immediate release
WATERMARK GROUP PLC INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2003
Watermark Group plc ("Watermark"), the provider of marketing support services to
the international travel industry, announces interim results for the six months
ended 30 June 2003.
Financial Highlights for the six months ended 30 June 2003:
* Turnover #16.36m (2002: #16.15m)
* Operating Profit #1.23m (2002: #1.20m)
* Headline PBIT #1.34m (2002: #1.20m)
* Headline EPS (basic) 3.77 pence (2002: 3.66 pence)
* Headline EPS (diluted) 3.72 pence (2002: 3.56 pence)
John Caulcutt, Chief Executive of Watermark, commented: "As time passes it is
easy to forget the impact that September 11th, SARS and the war in Iraq have had
on the industry in which we operate. Against this turbulent backdrop we believe
that our results show and will continue to show the strength of management and
the overall resilience of the group's business model. Recently market conditions
have seen some improvement so that we anticipate that the group will show
further growth for the current year."
For further information please contact:
John Caulcutt / Crispin Quail Rosie Brown / Claire Melly
Watermark Group plc Tavistock Communications
Tel: 01489 897800 Tel: 020 7920 3150
e-mail: info@watermarkplc.co.uk e-mail: rbrown@tavistock.co.uk
Chairman's and chief executive's letter to share owners
Whilst our interim figures for turnover, operating profit and headline earnings
are still ahead of last year, they do reflect the "head winds" that the airline
industry has continued to face as outlined in our AGM statement of the 25 June.
As time passes it is easy to forget the impact that September 11th, SARS and the
war in Iraq have had on the industry in which we operate. Against this
turbulent backdrop we believe that our results show and will continue to show
the strength of management and the overall resilience of the group's business
model. Recently market conditions have seen some improvement so that we
anticipate that the group will show further growth for the current year.
One year ago, analysts were invited to our UK headquarters to share our vision
to expand the range of goods and services that the group offers to the airline
and travel industry. In response to our clients' needs to lower operational
costs we explained our solution - the provision of a total cabin management
programme for products and services "above the wing".
In just twelve months we have put in place the building blocks for our future
growth by concluding or agreeing in principle no less than nine deals. Two of
these which have been concluded are the acquisitions of M'n'H Recycling Ltd and
Media on the Move Ltd and the remaining seven have been joint venture
agreements.
Two of these joint ventures, which have hitherto not been announced, have been
agreed in principle with Duty Free Air Ship and Supply (DFASS), the world's
largest provider of onboard retail programmes and with Inflight Productions
Limited, a company providing entertainment programming services for the airline
industry.
Furthermore, we have created two new divisions in-house to add to the portfolio
of products and services that we will be offering for the group's continued
development.
All of these deals will allow us to turn our total cabin management concept into
further income streams during 2004.
John A-G-Calthorpe John Caulcutt
Chairman Chief executive
26 September 2003
Unaudited consolidated summarised profit and loss account
for the six months ended 30 June 2003
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
------------ ----------- ----------
Turnover
Continuing Operations 13,732 14,206 29,467
Acquisitions 2,627 1,940 6,330
------------ ----------- ----------
16,359 16,146 35,797
------------ ----------- ----------
Operating profit
Continuing Operations 821 1,094 2,664
Acquisitions 409 109 463
------------ ----------- ----------
1,230 1,203 3,127
Net interest payable (148) (21) (134)
------------ ----------- ----------
Profit on ordinary activities 1,082 1,182 2,993
before taxation
Taxation (281) (307) (842)
------------ ----------- ----------
Profit on ordinary activities 801 875 2,151
after taxation
Dividends - - (397)
------------ ----------- ----------
Retained profit 801 875 1,754
------------ ----------- ----------
Headline PBIT* 1,343 1,203 3,193
Headline PBT* 1,195 1,182 3,059
------------ ----------- ----------
Headline earnings per share**
Basic earnings per share 3.77p 3.66p 9.22p
Diluted earnings per share 3.72p 3.56p 9.03p
------------ ----------- ----------
Standard earnings per share
Basic earnings per share 3.30p 3.66p 8.95p
Diluted earnings per share 3.26p 3.56p 8.76p
------------ ----------- ----------
*Headline PBIT: Profit on ordinary activities before interest, taxation and
amortisation of goodwill.
Headline PBT: Profit on ordinary activities before taxation and amortisation of
goodwill.
The calculation of Headline PBIT and Headline PBT are presented as note 3.
** Headline earnings per share exclude amortisation of goodwill.
The calculation of Headline earnings is presented as note 4.
Unaudited consolidated balance sheet
as at 30 June 2003
As at As at As at
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
------------ ---------- -------------
Fixed assets
Goodwill 4,337 1,906 1,771
Tangible assets 676 408 556
Investments 337 337 337
------------ ---------- -------------
5,350 2,651 2,664
Current assets
Stocks 4,941 5,163 4,533
Debtors 13,262 11,267 15,266
Cash at bank and in hand 2,716 975 4,160
------------ ---------- -------------
20,919 17,405 23,959
Creditors : Amounts falling due (14,627) (13,204) (17,552)
within one year
------------ ---------- -------------
Net current assets 6,292 4,201 6,407
------------ ---------- -------------
Total assets less current liabilities 11,642 6,852 9,071
------------ ---------- -------------
Creditors : Amounts falling due after (2,835) - (1,622)
more than one year
------------ ---------- -------------
Total assets 8,807 6,852 7,449
------------ ---------- -------------
Capital and reserves
Called-up share capital 244 242 242
Share premium account 1,056 900 886
Shares to be issued 1,369 1,002 974
Capital redemption reserve 24 24 24
Merger reserve (527) (527) (527)
Profit and loss account 6,641 5,211 5,850
------------ ---------- -------------
Equity share owners' funds 8,807 6,852 7,449
------------ ---------- -------------
Unaudited consolidated statement of total recognised gains and losses
for the six months ended 30 June 2003
Six months Six months Year
ended ended ended
30 June 2003 30 June 2002 31 December
2002
#'000 #'000 #'000
----------- ---------- -------------
Profit for the financial year 801 875 2,151
Currency translation (10) (42) (282)
----------- ---------- -------------
Total recognised gains
relating 791 833 1,869
to the period
----------- ---------- -------------
Unaudited consolidated cash flow statement
for the six months ended 30 June 2003
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
---------- ---------- ----------
Net cash inflow / (outflow) from 604 (691) (990)
operating activities
Returns on investments and servicing (148) (21) (134)
of finance
Taxation (201) (477) (881)
Capital expenditure and financial investment (171) (66) (304)
Acquisitions and disposals (411) - (1,467)
Equity dividends paid - - (299)
---------- ---------- ----------
Net cash outflow before financing (327) (1,255) (4,075)
Financing (155) 232 215
---------- ---------- ----------
Decrease in cash (482) (1,023) (3,860)
---------- ---------- ----------
Reconciliation of operating profit to net
inflow / (outflow) from operating
activities
Operating profit 1,230 1,203 3,127
Depreciation and amortisation charges 219 55 244
Exchange difference on retranslation 1 (85) (282)
of foreign currency net assets
(Increase) / decrease in stocks (389) 433 964
Decrease / (increase) in debtors 3,058 (3,219) (7,368)
(Decrease) / increase in creditors (3,515) 922 2,325
---------- ---------- ----------
Net cash inflow / (outflow) from 604 (691) (990)
operating activities
---------- ---------- ----------
Net cash inflow / (outflow) from
acquisitions 384 - (527)
---------- ---------- ----------
Net cash inflow / (outflow) from 220 (691) (463)
continuing operations
---------- ---------- ----------
604 (691) (990)
---------- ---------- ----------
Notes :
1. The results for the year to 31 December 2002 do not constitute statutory
accounts. They are an abridged version of the full accounts which received an
unqualified report by the auditors and have been filed with the Registrar of
Companies. The interim results are unaudited.
2. The taxation charge for the six months ended 30 June 2003 is based on the
effective rate which is estimated to apply for the full year.
3. Headline PBIT and PBT
Headline PBIT is calculated as profit on ordinary activities before interest,
taxation and amortisation of goodwill
Headline PBT is calculated as profit on ordinary activities before taxation and
amortisation of goodwill
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Profit on ordinary activities before
interest and taxation 1,230 1,203 3,127
Amortisation of goodwill 113 - 66
Headline PBIT 1,343 1,203 3,193
Interest payable (148) (148) (148)
Headline PBT 1,195 1,055 3,045
4. Standard basic and diluted earnings per share have been calculated in
accordance with FRS14 - Earnings per share. Diluted earnings per share takes
into account the effect of the exercise of employee share options and shares to
be issued where these are expected to dilute earnings. In order to show the
results from operating activities on a comparable basis, headline earnings per
share, both diluted and basic, have been presented which exclude amortisation of
goodwill from the adjusted earnings calculation. The calculations of earnings
per share are based on the following profits and weighted average numbers of
shares.
Six months ended Six months ended Year ended
30 June 2003 30 June 2002 31 December 2002
Earnings Shares Earnings Shares Earnings Shares
#'000 Number #'000 Number #'000 Number
Standard earnings
per share
Basic earnings per share 801 24,254,902 875 23,889,473 2,151 24,040,859
Add dilutive effect of
share options - 336,573 - 697,294 - 523,724
Diluted earnings per
share 801 24,591,475 875 24,586,767 2,151 24,564,583
Headline earnings
per share
Basic earnings per share 801 24,254,902 875 23,889,473 2,151 24,040,859
Add amortisation of
goodwill 113 - - - 66 -
Headline earnings per
share - basic 914 24,254,902 875 23,889,473 2,217 24,040,859
Diluted earnings per
share 801 24,591,475 875 24,586,767 2,151 24,564,583
Add amortisation of
goodwill 113 - - - 66 -
Headline earnings per
share - diluted 914 24,591,475 875 24,586,767 2,217 24,564,583
5. This report covers the six month period ended 30 June 2003 and was approved
by the board of directors on 26 September 2003. It has not been audited or
reviewed by the group's auditors.
6. The Interim Report will be posted to all share owners before 14 October 2003
and is available at the company's registered office :
Belmore Park
Upham
Hampshire
SO32 1HQ
This information is provided by RNS
The company news service from the London Stock Exchange
END
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