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RNS Number : 4348Q
Mountfield Group plc
12 September 2017
 

 

 

 

12 September 2017

 

 

 

Mountfield Group Plc (the "Company" or "the Group")

Half-yearly report to 30 June 2017

 

 

Mountfield Group Plc ("the Group"), the AIM listed commercial flooring and specialist construction services company announces its half-yearly report to 30 June 2017.

·      Net profit before tax for the first half of 2017 was £305k (2016: £316k).

·      The Board expects a markedly improved performance from the Group for 2017 over 2016.

·      Connaught Access Flooring Limited ("CAF" or "Connaught") has won over £6m worth of contracts since the beginning of 2017.

·      The Board anticipates that CAF is about to win another significant contract - one with an initial value of c£4m.

·      Mountfield Building Group Limited ("MBG") is in negotiation over a number of valuable opportunities and its performance in the second half of the year is expected to be substantially stronger.

 

Andy Collins - Group CEO said:

CAF has successfully tendered for £6m of new business since 1 January 2017 and expects shortly to confirm the gaining of a new, substantial contract. Together, this demonstrates the progress it has made in establishing itself as one of the few top-tier commercial flooring suppliers and installers. It also underlines its status as one of the very few commercial flooring companies that major construction companies and developers will trust when choosing a specialist able to take on a complex and valuable project, and one that has the proven ability to produce a very high quality product within a tight time schedule.

This level of turnover (the aggregate won in the first six months is more than it has previously won in a twelve month period) will ensure a strong performance during the current year and provide it with a strong start for 2018.

 

With a number of exciting opportunities under negotiation with both existing and new clients, the Board expects MBG to perform strongly in the second half of the year in terms of the profitable delivery of current projects and in securing significant new ones for completion in 2018 in line with its recently adopted business criteria and strategy."

 

 

 

Mountfield Group Plc

Peter Jay, Chairman

Andy Collins, Chief Executive Officer

 

+44 (0)1268 561 516

 

Cairn Financial Advisers LLP

Jo Turner/Tony Rawlinson

 

 

+44 (0)20 7213 0880

 

Chairman and CEO's Statement

 

The first half of 2017 saw the Group generate a net profit before tax of £305k a figure that was in line with that earned in the corresponding period of 2016 (£316k).

 

The Board is very pleased with the progress that the Group has made in the first half of 2017 and expects a stronger performance in the second half of the year over that achieved in 2016 and that, as a result, the full year figures will reflect a marked improvement compared with those for the 2016 financial year. 

 

Connaught

 

CAF has had an extremely satisfactory first half and achievement is reflected in the net profit of £408k earned during the first half (2016: £397k) but more particularly in the new business it has acquired to be undertaken during 2017-8. The first three of these contracts had already been announced and of them, two were separate contract stages in respect of a single property that were announced on 7 March 2017 (value of £1.2m) and on 29 August 2017 with a value of £1.5m to be undertaken in the 12 months from October 2017. In addition, the Company was awarded a contract valued at £2.5m (announced on 7 March 2017) for completion during 2017.

 

In addition to these contracts, the Board is confident that CAF is about to be awarded a particularly significant contract - one with an initial value of circa £4m - to supply and install flooring at another major office development in the City of London.

 

The Board expects that the Company's successes in 2017 are unlikely to be limited to these contracts. The market remains strong in terms of tender activity and CAF expects to secure additional works including some to be undertaken in 2018.

 

MBG

 

MBG's levels of activity and involvement in tendering and contract negotiations in the first half of the year were not reflected in its performance and in particular in the net profit of £44k (2016: £71k). The announcement on 6 September of it having won contracts for a single client with an aggregate value of approximately £750k and another where the client has provided MBG with a letter of intent enabling it to procure essential materials in advance of the commencement of a contract with a value in excess of £1m. These contracts are expected by the Board to be followed by a series of other contract wins during the remaining months of 2017.

 

The Board anticipates the Group performing well in the second half of the year and also CAF and MBG securing further business that will ensure a strong backbone for 2018.

 

Condensed consolidated statement of comprehensive income

For the six months ended 30 June 2017

 

 

 

 

6 months to
30 June 2017

 

6 months to
30 June 2016

 

12 months to
31 December 2016

 

 

(unaudited)

 

(unaudited)

 

(audited)

 

Note

£

 

£

 

£

Revenue

 

5,683,667

 

4,915,089

 

9,634,979

Cost of sales

 

(4,653,137)

 

(3,892,054)

 

(7,787,965)

Gross profit

 

1,030,530

 

1,023,035

 

1,847,014

Administrative expenses

 

(714,696)

 

(695,182)

 

(1,377,194)

Operating profit

 

315,834

 

327,853

 

469,820

Net finance costs

 

(10,815)

 

(11,436)

 

(27,276)

Profit before income tax

 

305,019

 

316,417

 

442,544

Income tax expense

3

(84,414)

 

(68,871)

 

(108,805)

 

 

 

 

 

 

 

Total comprehensive profit for the period

 

220,605

 

247,546

 

333,739

 

 

 

 

 

 

 

Earnings per share

4

 

 

 

 

 

 

 

 

 

 

 

 

Basic & diluted

 

0.086p

 

0.097p

 

0.131p

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

There are no recognised gains and losses other than those passing through the Statement of Comprehensive Income

 

Condensed consolidated statement of financial position

As at 30 June 2017

 

 

 

30 June 2017

(Unaudited)

30 June 2016

(Unaudited)

31 December 2016

(audited)

 

 

£

£

£

ASSETS

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets

 

6,874,308

6,874,308

6,874,308

Property, plant and equipment

 

85,389

97,612

90,956

Deferred income tax assets

 

269,030

329,932

295,268

 

 

7,228,727

7,301,852

7,260,532

Current assets

 

 

 

 

Inventories

 

100,601

84,870

88,272

Trade and other receivables

 

2,916,039

2,743,903

1,776,611

Cash and cash equivalents

 

-

396,024

-

 

 

3,016,640

3,224,797

1,864,883

TOTAL ASSETS

 

10,245,367

10,526,649

9,125,415

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

Share capital and reserves

 

 

 

 

Issued share capital

 

2,524,426

254,244

2,524,426

Share premium

 

1,490,682

1,490,682

1,490,682

Share based payments reserve

 

68,871

68,871

68,871

Capital redemption reserve

 

7,500

7,500

7,500

Merger reserve

 

4,051,967

12,951,180

4,051,967

Reverse acquisition reserve

 

(2,856,756)

(2,856,756)

(2,856,756)

Retained earnings

 

(358,581)

(9,564,591)

(579,186)

TOTAL EQUITY

 

4,928,109

2,351,130

4,707,504

 

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

 

3,357,051

3,590,023

2,894,439

Short-term borrowings

 

1,434,896

1,620,615

897,579

Finance lease liabilities

 

-

2,399

583

Current tax payable

 

115,946

52,499

57,770

 

 

4,907,893

5,265,536

3,850,371

Non-current liabilities

 

 

 

 

Loan notes

 

297,911

2,909,983

393,857

Bank Loan

 

111,454

-

173,683

TOTAL LIABILITES

 

5,317,258

8,175,519

4,417,911

 

 

 

 

 

TOTAL EQUITY & LIABILITIES

 

10,245,367

10,526,649

9,125,415

 

Condensed consolidated statement of changes in equity

For the six months ended 30 June 2017

 

 

 

Share capital

 

£

   Share premium

 

£

Share based payments reserve

£      

Capital redemption
reserve
£

Reverse Acquisition
reserve

£

Merger reserve

 

£

Retained earnings

 

£

Total  

 

 

£  

Balance at 1 January 2016

254,244

1,490,682

68,871

7,500  

(2,856,756)

12,951,180

(9,812,138)

2,103,583

Total comprehensive income

-

-

-

-  

-

-

247,546

-

Balance at 30 June 2016

254,244

1,490,682

68,871

7,500  

(2,856,756)

12,951,180

(9,564,591)

2,351,130

Balance at 1 July 2016

254,244

1,490,682

68,871

7,500  

(2,856,756)

12,951,180

(9,564,591)

2,351,130

Total comprehensive income

-

-

-

-  

-

-

86,193

86,193

Conversion of loan notes

2,270,182

-

-

-  

-

-

-

2,270,182

Transfer

-

-

-

-  

-

(8,899,213)

8,899,213

-

Balance at 31 December 2016

2,524,426

1,490,682

68,871

7,500  

(2,856,756)

4,051,967

(579,186)

Balance at 1 January 2017

2,524,426

1,490,682

68,871

7,500  

(2,856,756)

4,051,967

(579,186)

4,707,504

Total comprehensive income

-

-

-

-  

-

-

220,605

220,605

Balance at 30 June 2017

2,524,426

1,490,682

68,871

7,500  

(2,856,756)

4,051,967

(358,581)

4,928,109

 

Condensed consolidated cash flow statement

For the six months ended 30 June 2017

 

 

6 months to

30 June 2017

(unaudited)

6 months to

30 June 2016

(unaudited)

12 months to

31 December 2016

 (audited)

 

 

£

£

£

Cash from operating activities:

 

 

 

 

Operating profit

 

315,834

327,853

469,820

Adjusted for:

 

 

 

 

Depreciation

 

6,453

6,861

13,516

(Increase)/ decrease in inventories

 

(12,329)

(12,035)

(15,437)

(Increase)/ decrease in trade and other receivables

 

(1,139,428)

(398,109)

569,187

(Decrease)/ increase in trade and other payables

 

740,843

2,483

(614,007)

Cash (used in)/ generated by operations

 

(88,627)

(72,947)

423,079

 

 

 

 

 

Finance costs

 

(10,815)

(11,436)

(27,276)

Finance income

 

-

-

-

Taxation paid

 

-

-

-

Net cash (outflow)/inflow from operating activities

 

 

(99,442)

 

(84,383)

 

395,803

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Purchase of equipment

 

(886)

(2,259)

(2,259)

Net cash flows from used in investing activities

 

 

         (886)

 

(2,259)

 

(2,259)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

Finance lease rentals

 

(583)

(1,747)

(3,564)

Repayment of non-convertible loan notes

 

(95,946)

(137,437)

(283,381)

Facility repayments

New facility loan

 

(62,229)

-

-

-

(51,858)

350,000

 

Net cash flows from financing activities

 

 

(158,758)

 

(139,184)

 

11,197

 

Net (decrease)/increase in cash and cash equivalents

 

 

(259,086)

 

(225,826)

 

404,741

 

 

 

 

 

Cash and cash equivalents brought forward

 

(20,247)

(424,988)

(424,988)

 

Cash and cash equivalents carried forward

 

 

(279,333)

 

(650,814)

 

(20,247)

 

For the purposes of the cash flow statement, cash and cash equivalents comprise the following:

 

 

  As at

30 June 2017

As at

30 June 2016

As at

31 December 2016

 

£

£

£

Cash at bank and in hand

-

396,024

-

Bank overdraft

(279,333)

(1,046,838)

(20,247)

 

 

 

 

 

(279,333)

(650,814)

(20,247)

 

1.     Notes to the Interim Report

 

Basis of preparation

The Group's interim financial statements for the six months ended 30 June 2017 were authorised for issue by the directors on 12 September 2017.

 

The consolidated interim financial statements, which are unaudited, do not constitute statutory accounts within the meaning 
of Section 434 of the Companies Act 2006. The statutory accounts for the year ended 31 December 2016 have been filed with 
the Registrar of Companies at Companies House. The audit report on the statutory accounts for the year ended 31 December 
2016 was unqualified and did not contain any statements under Section 498 (2) or (3) of the Companies Act 2006.

 

The annual financial statements of Mountfield Group Plc for the year ended 31 December 2017 will be prepared in accordance 
with International Financial Reporting Standards as adopted for use in the EU ("IFRS"). Accordingly, these interim financial 
statements have been prepared using accounting policies consistent with those which will be adopted by the Group in the 
financial statements and in compliance with IAS 34 "Interim financial reporting".

 

The consolidated interim financial statements have been prepared in accordance with the accounting policies set out in the 
annual financial statements for the year ended 31 December 2016.

 

Basis of consolidation

The Group financial information consolidates that of the company and its subsidiaries.

 

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

 

2.     Segmental reporting

 

Segment information is presented in respect of the Group's business segments, which are based on the Group's management 
and internal reporting structure.

The chief operating decision-maker has been identified as the Board of Directors (the Board). The Board reviews the Group's internal reporting in order to assess performance and allocate resources. Management have determined the operating segments based on these reports and on the internal report's structure.

Segment performance is evaluated by the Board based on revenue and profit before tax ("PBT"). Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis, such as centrally managed costs relating to individual segments and costs relating to land used in more than one individual segment.

Given that income taxes and certain corporate costs are managed on a centralised basis, these items are not allocated between operating segments for the purposes of the information presented to the Board and are accordingly omitted from the analysis below.

The Group comprises the following segments:

Mountfield
Direct contracting and trade contracting services to both main contractors and corporate end users.

Connaught
Providing raised flooring systems to both main contractors and corporate end users.

 

Segmental operating performance

 

Six months to

30 June 2017

Six months to

30 June 2016

Twelve months to

31 December 2016

 

Segmental revenue

PBT

Segmental revenue

PBT

Segmental revenue

PBT

 

£'000

£'000

£'000

£'000

£'000

£'000

Construction

1,298

44

1,734

71

4,346

232

 

 

 

 

 

 

 

Fit -out

4,386

408

3,198

397

5,321

307

 

 

 

 

 

 

 

 

5,684

452

4,932

468

9,667

539

Inter-segmental              revenue and unallocated costs

 

-

 

 (147)

 

(17)

 

(152)

(32)

(97)

 

5,684

305

4,915

316

9,635

442

 

 

Business segments assets and liabilities

 

 

Six months to

30 June 2017

Six months to

30 June 2016

Twelve months to

31 December 2016

 

Segment assets

Segment liabilities

Segment assets

Segment liabilities

Segment assets

Segment liabilities

 

£'000

£'000

£'000

£'000

£'000

£'000

Construction

953

2,693

2,469

3,727

713

2,599

 

 

 

 

 

 

 

Fit-out

2,406

1,774

1,184

1,831

1,223

594

 

 

 

 

 

 

 

 

3,359

4,467

3,653

5,558

1,936

3,193

 

 

 

 

 

 

 

Goodwill - Construction

2,000

-

2,000

-

2,000

-

Goodwill - Fit-out

4,874

-

4,874

-

4,874

-

Other unallocated assets & liabilities

12

850

-

2,565

315

1,225

 

10,245

5,317

10,527

8,123

9,125

4,418

 

Unallocated assets consist of deferred tax, trade and other receivables and cash held by the Parent Company. 
Unallocated liabilities consist of trade and other payables and interest bearing loans owed by the Parent Company.

 

Revenue by geographical destination

 

Revenue is attributable to the United Kingdom and other EU markets.

 

Total assets including property, plant and equipment and intangible assets are all held in the UK.

 

3.          Income tax (expense)/credit (continuing operations)

 

 

6 months to

30 June 2017

6 month to

  30 June 2016

12 months to

31 December 2016

 

(unaudited)

(unaudited)

(audited)

 

£

£

£

Current tax on income for the period

(58,176)

(52,499)

(57,769)

Deferred tax (expense)

(26,238)

(16,372)

(51,036)

Income tax (expense)/credit in the income statement

(84,414)

(68,871)

(108,805)

 

 

4.           Earnings per share

 

The basic earnings per share is calculated by dividing the earnings attributable to equity shareholders by the weighted average 
number of shares in issue. In calculating the diluted earnings per share, share options outstanding have been taken into account 
where the impact of these is dilutive.

 

The weighted average number of shares in the period was:

 

 

 

6 months to

30 June 2017

6 months to

30 June 2016

12 months to
31 December
2016

 

 

 

(unaudited)

 

(unaudited)

(audited)

 

 

 

 

 

 

 

 

 

 

Number

Number

Number

 

 

 

 

 

 

Basic ordinary shares of 0.1p each

 

 

256,514,636

254,244,454

254,339,045

Dilutive ordinary shares from warrants & options

 

 

-

-

-

Total diluted

 

 

256,514,636

254,244,454

254,339,045

 

 

 

 

 

 

 

 

 

 

 

 

 

In the six months to 30 June 2017, the exercise price of the options and warrants exceeded the average market price of ordinary shares in the period, thus there is no dilutive effect on the weighted average number of ordinary shares or the diluted earnings per 
share.

 

Earning attributable to equity shareholders of the parent

 

 

 

 

6 months to

30 June 2017

6 months to

30 June 2016

12 months to

31 December
2016

 

 

 

(unaudited)

 

(unaudited)

(audited)

 

 

 

 

 

 

 

Continuing operations

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

 

 

0.086p

0.097p  

0.131p

Diluted earnings per share

 

 

0.086p

0.097p                            

0.131p

Total diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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