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CASSIDY BROTHERS plc (the "Company")
Interim Results to 31 October 2008
Chairman's Statement
The Company's performance for the six months to 31 October 2008 has shown a 6% increase in turnover to £2.07 million (2007: £1.95 million), generating a profit before taxation of £274,239 (2007: £134,751).
This increase has occurred by increased overseas F.O.B. business from the Middle East and Australia, and the purchase of the toy Dyson vacuum cleaners by Dyson Appliances to assist their marketing campaigns in Europe.
The Company maintains a strong balance sheet with net assets of £3,571,675 (2007: £3,318,264), representing a net asset value of 64.7 pence per share (2007: 60.1 pence per share). As at 31 October 2008 the Company had a cash balance of £440,794.
Current Trading
I believe the toy trade has ridden out past recessions under the presumption that parents / guardians continue to spend on their children. This next twelve months will test that theory, because the toy trade has received an approximate 25% drop in the £/$ exchange rate and an average 20% increase in the Chinese factory gate prices. The latter resulting from an increase in plastic raw materials and labour costs.
The cost of oil has a direct effect on plastic raw material prices, therefore, mid-year we undertook a complete review of certain product designs, with a view to making tooling alterations in order to produce a lighter product. The resultant savings have far outweighed the additional tooling costs involved.
Our overseas FOB business is increasing every year and as we invoice all these customers in US$ and indeed on occasion in Euro, it is comforting to hold these currencies on bank deposit whilst the value of sterling declines.
This year we tooled and developed a toy version of the latest Dyson canister type vacuum cleaner, the DC22. The success of this project is reliant on sales from two directions. Firstly, Dyson Appliances themselves, whose first orders helped significantly towards the tooling costs, and secondly, sales into Europe through a German toy distributor. Germany and France favour the canister/cylinder type vacuum cleaner as opposed to the U.K. and U.S.A. who favour the upright.
We have struggled to improve on the increases experienced over the U.K. Christmas period last year. The November and December sales figures, which are not included in this report, will be lower than 2007 owing to the difficult trading conditions in the U.K. high street stores.
The Company was not affected directly by the closure of Woolworths, but the price cutting will have hurt the independent retail sector.
Future Prospects
The U.K. high street has been competing for an ever decreasing slice of the consumers income, with tactics such as "50% off", "3 for 2", "BOGOF" (Buy One Get One Free). It is amazing how the independent toy retailer has survived and we are now witnessing the laws of "economic selection", where he who survives, wins. If you take out 800 Woolworths stores, this has got to speed up the changes that are going to occur with the juggernaut of internet sales.
As anticipated in my 2007 Interim Statement, the Chinese governments tightening of factory controls has seen the closure of over 3,000 toy factories, a further result of "economic selection".
Due to the disappointing sales from the U.S.A. in 2008 we have decided to handle this business ourselves rather than rely on a U.S. based distributor. The Company will be exhibiting at the New York toy fair in February, offering FOB terms directly to major accounts, with sales administration being handled from our Blackpool office.
We will have two new products for 2009, the first being a toy version of the George Foreman health grills by Salton Europe, "the lean mean grilling machine". The second is a Postman Pat steering wheel with electronic sounds. This television series has been given a brand new make over with up to date vehicles. We are planning a targeted television promotion for both of these products on children's television which will be funded from our existing working capital resources.
Interim Dividend
In spite of recession fears, the Directors remain positive, and the Board has therefore announced an increased interim dividend of 1.0 pence per share (2007: Interim Dividend 0.7 pence per share) to be paid on 9 April 2009 to shareholders on the register on 6 March 2009.
The Directors would like to wish all shareholders a prosperous new year for 2009, and to thank you all for your support.
Paul M. Cassidy
Chairman
26 January 2009
Profit & Loss Account | Six months | Six months | Year | ||
ended | ended | ended | |||
31 October | 31 October | 30 April | |||
2008 | 2007 | 2008 | |||
(unaudited) | (unaudited) | ||||
£ | £ | £ | |||
Turnover | 2,075,962 | 1,948,465 | 3,319,759 | ||
Cost of Sales | (1,211,017) | (1,309,739) | (1,871,085) | ||
Gross Profit | 864,945 | 638,726 | 1,448,674 | ||
Warehouse and Distribution Costs | (446,500) | (382,588) | (925,862) | ||
Administrative Expenses | (209,022) | (190,402) | (407,066) | ||
Other Operating Income | 66,309 | 62,962 | 128,605 | ||
Operating profit | 275,732 | 128,698 | 244,351 | ||
Net interest (payable) / receivable | (1,493) | 6,053 | (3,253) | ||
Profit on ordinary | |||||
activities before taxation | 274,239 | 134,751 | 241,098 | ||
Taxation | (57,590) |
| (26,950) | 25,000 | |
Profit attributable | |||||
to shareholders | 216,649 | 107,801 | 266,098 | ||
Dividends | (82,865) | (71,817) |
| (110,487) | |
Retained profit | 133,784 | 35,984 | 155,611 | ||
Earnings per share | 3.92p | 1.95p | 4.82p | ||
Summarised Balance Sheets | As at | As at | As at | ||
31 October | 31 October | 30 April | |||
2008 | 2007 | 2008 | |||
(unaudited) | (unaudited) | ||||
£ | £ | £ | |||
Fixed assets | 2,114,481 | 2,035,994 | 2,131,784 | ||
Stock | 541,442 | 529,626 | 379,950 | ||
Debtors | 1,640,966 | 1,567,582 | 279,997 | ||
Cash | 440,794 | 578,739 | 961,340 | ||
Current assets | 2,623,202 | 2,675,947 | 1,621,287 | ||
Creditors: amounts falling due | |||||
within one year | (1,122,930) | (1,323,840) | (285,932) | ||
Net current assets | 1,500,272 | 1,352,107 | 1,335,355 | ||
Total assets less current liabilities | 3,614,753 | 3,388,101 | 3,467,139 | ||
Deferred liabilities and provisions | (43,078) | (69,837) | (29,248) | ||
Net assets employed | 3,571,675 | 3,318,264 | 3,437,891 | ||
Share capital | 552,435 | 552,435 | 552,435 | ||
Reserves | 3,019,240 | 2,765,829 | 2,885,456 | ||
Shareholders' funds | 3,571,675 | 3,318,264 | 3,437,891 | ||
NAV per share | 64.7p | 60.1p | 62.2p | ||
Cash Flow Statement | Six Months | Six Months | Year | ||||||||
Ended | Ended | Ended | |||||||||
31 October | 31 October | 30 April | |||||||||
2008 | 2007 | 2008 | |||||||||
£ | £ | £ | |||||||||
Operating Profit | 275,732 | 128,698 | 244,351 | ||||||||
Depreciation charges | 58,650 | 51,750 | 86,433 | ||||||||
Profits on sale of tangible fixed assets |
| (11,531) | (11,531) | ||||||||
(Increase) in Stock | (161,492) | (332,232) | (182,556) | ||||||||
(Increase) / Decrease in Debtors | (1,360,969) | (1,262,115) | 25,470 | ||||||||
Increase in Creditors | 379,727 | 497,525 | 106,113 | ||||||||
(808,352) | (927,905) | 268,280 | |||||||||
Net Interest (paid)/received | (1,493) | 6,053 | (3,253) | ||||||||
Taxation | |||||||||||
Capital Expenditure | (41,347) | (66,693) | (197,166) | ||||||||
Equity Dividends paid | (82,865) | (71,817) | (110,487) | ||||||||
Unsecured loan and Finance lease | 13,830 | (1,285) | (49,244) | ||||||||
(Decrease) in Cash Flow | (920,227) | (1,061,647) | (91,870) | ||||||||
Notes
1. The results for the half year ended 31 October 2008, which have been prepared in accordance with the accounting policies adopted in the financial statements for the year ended 30 April 2008, have not been audited or reviewed by the Company's Auditors and do not constitute statutory accounts as defined in s240 of the Companies Act 1985.
The financial information for the year ended 30 April 2008 is an abridged version of the full accounts for that year, which have received an unqualified audit report and have been filed with the Registrar of Companies.
2. Taxation for the six months ended 31 October 2008 has been based on the estimated effective tax rate for the full year.
3. The calculation of Earnings per share is based upon the profit after taxation for the period divided by the number of ordinary shares in issue during the period. The number of shares in issue was 5,524,350 ordinary shares.
4. The calculation of Net Asset Value per share is based upon shareholders funds divided by the number of ordinary shares in issue at the balance sheet date. The number of shares in issue was 5,524,350 ordinary shares.
5. Deferred liabilities and provisions relate to provisions for deferred taxation and motor vehicle hire purchase.
6. This interim report will be sent to shareholders in due course. Further copies will be available to the public from the Company's registered office, Cornford Road, Off Clifton Road, Marton, Blackpool, FY4 4QQ and on the Company's website www.casdon.com.
This information is provided by RNS
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