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Latham(James) PLC  -  LTHM   

Final Results

Released 07:00 28-Jun-2018

RNS Number : 8187S
Latham(James) PLC
28 June 2018
 

James Latham PLC

 

("James Latham" or the "Group")

 

Final Results

 

Chairman's statement

 

I am pleased to report good trading results for the financial year to 31 March 2018.

 

Revenue for the financial year to 31 March 2018 was £214.9m, up 8.1% on last year's £198.8m. We have seen volumes continue to grow, especially through our own warehouses where they are up 4.5%. The cost price of our products have increased in comparison to the previous twelve months. This is in part down to the weakening of sterling against the Euro, but also we have seen manufacturers continuing to increase their prices.

 

Gross margin for the financial year to 31 March 2018 was 17.6% compared with 18.2% in the previous financial year. It was particularly pleasing to see an improvement in the gross margin in the second half of the year, which was 17.9% compared with 17.3% in the first half of the year.

 

Selling and distribution costs were 5.3% higher than last year. Distribution costs rise in line with volumes, and we monitor costs per delivered tonne which are up by 2.3%.

 

Overheads have been well controlled when we consider that we have relocated both Yate and Leicester (Wigston) sites during the year. We have successfully minimised the relocation costs and double costs of owning two empty sites, which have cost us less than £150,000. Both sites are performing extremely well since their relocation, particularly in added value products where the new racking systems have allowed us to increase our stock range.

 

Profit before tax is £15.2m, up £1.4m on last year's £13.8m. This includes a profit of £1.3m on the sale of our Wigston site.

 

Post tax profit for the year is £12.6m, up from last year's £11.0m.

 

Earnings per ordinary share were 64.4p (2017: 56.0p) an increase of 15.0%.

 

As at 31 March 2018 net assets have increased to £89.8m (2017: £73.3m). Non-current assets have increased by £6.1m from 31 March 2017, with the investment in the two new sites as well as continuing investment in our vehicle fleet and warehouse forklifts. Inventory levels have increased to £40.1m, partly due to the increase in unit cost of the stock as well as an increase in volumes. Trade Receivables have continued to show good debtors day figures with there being another low bad debt charge of under 0.15% of revenue. Cash and cash equivalents of £14.0m (2017: £17.2m), remain strong with good cash flows from operating activities.

 

Pension Scheme

 

The company and the Trustees of the James Latham plc Pension and Assurance Scheme have approved the triennial valuation dated 31 March 2017 with the scheme actuary. This valuation shows a shortfall of assets of £12.1m compared to a shortfall of £1.5m in the previous valuation dated 31 March 2014. The company has agreed a recovery plan with the trustees of £2.0m per annum until 31 March 2024.

 

At 31 March 2018 the deficit of the defined benefit scheme under IAS19 (revised) was £8.4m, down £8.2m compared with £16.6m last year. The calculation of the pension deficit remains very sensitive to changes in assumptions.

 

Final dividend

 

The Board has declared a final dividend of 12.1p per Ordinary Share (2017: 10.85p). The dividend is payable on 24 August 2018 to ordinary shareholders on the company's register at close of business on 3 August 2018. The ex-dividend date will be 2 August 2018.

 

The total dividend per ordinary share of 16.6p for the year (2017: 15.35p) is covered 3.9 times by earnings (2017: 3.6 times).

 

Current and future trading

 

This year has started well with sales per working day 9.8% higher for April and May than the corresponding period last year. Margins are very slightly lower than the second half of 2017/8. We are seeing growth in sales of added value timber and panel products from our decision to invest in specialist sales staff last year, although volume growth in our core products is proving more challenging. Despite the strong start to the year, there is increasing uncertainty surrounding the economic outlook, but we remain confident that we are in a strong position to continue to grow the business.

 

Development Strategy

 

The directors will continue to develop the business. This will be done by a combination of investing in our current warehouse facilities, with the emphasis this year on Purfleet, Thurrock and Gateshead, and further extending our hours of operation. We are also looking at geographical growth, and focusing on developing sales of our key product areas. In addition to our showroom at the Business Design Centre in Islington, we are in the process of opening a design centre in Manchester as we continue to focus our efforts in the A&D specification sector.

 

 

 

 

Nick Latham

Chairman

27 June 2018

 

Enquiries

 

 

James Latham plc

 

Tel: 01442 849 100

Nick Latham, Chairman

David Dunmow, Finance Director




Northland Capital Partners Limited

Nominated Adviser and Broker

Tel: 0203 861 6625

Matthew Johnson / Edward Hutton

John Howes


 

 

 

 



JAMES LATHAM PLC

CONSOLIDATED INCOME STATEMENT

For the year to 31 March 2018


Audited

Audited

 

Year to 31 March

 2018

Year to 31 March 2017


£000

£000

 



Revenue

214,919

198,808

 



Cost of sales (including warehouse costs)

(177,145)

(162,709)




Gross profit

37,774

36,099




Selling and distribution costs

(16,277)

(15,457)

Administrative expenses

(7,106)

(6,463)

Operating Profit

14,391

14,179

 



Profit on disposal of property

1,276

-

Finance income

37

56

Finance costs

(488)

(408)

 

 

 

Profit before tax

15,216

13,827

 

 

 

Tax expense

(2,570)

(2,846)

 

 

 

Profit after tax attributable to owners of the parent company

12,646

10,981

 

 

 

Earnings per ordinary share (basic)

64.4p

56.0p

Earnings per ordinary share (diluted)

64.1p

55.8p

 

All results relate to continuing operations.



 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year to 31 March 2018


Audited

Audited


2018
2017


£000

£000

Profit after tax attributable to owners of the parent company

12,646

10,981




Other comprehensive income



Actuarial gain/(loss) on defined benefit pension scheme

7,948

(7,543)

Deferred tax relating to components of other comprehensive income

 

(1,262)

 

1,358

Other comprehensive income for the year, net of tax

6,686

(6,185)

Total comprehensive income attributable to owners of the parent company

 

19,332

 

4,796



JAMES LATHAM PLC                                                           COMPANY REGISTRATION NUMBER 65619

CONSOLIDATED BALANCE SHEET

At 31 March 2018


Audited

Audited


2018

2017

 

£000

£000

Assets



Non-current assets



Goodwill

237

237

Other intangible assets

1

1

Property, plant and equipment

33,831

26,312

Deferred tax asset

1,491

2,904

Total non-current assets

35,560

29,454

 



Current assets



Inventories

40,068

35,508

Trade and other receivables

41,508

40,076

Cash and cash equivalents

13,989

17,246

Assets held for sale

638

-

Total current assets

96,203

92,830

Total assets

131,763

122,284

 

 

 

Current liabilities



Trade and other payables

28,648

27,063

Tax payable

1,292

1,517

Total current liabilities

29,940

28,580




Non-current liabilities



Interest bearing loans and borrowings

987

987

Retirement and other benefit obligation

8,382

16,625

Other payables

291

349

Deferred tax liabilities

2,374

2,485

Total non-current liabilities

12,034

20,446

Total liabilities

41,974

49,026




Net assets

89,789

73,258




Capital and reserves



Issued capital

5,040

5,040

Share-based payment reserve

184

108

Own shares

(529)

(291)

Capital reserve

3

3

Retained earnings

85,091

68,398

Total equity attributable to equity shareholders of the parent company

 

89,789

 

73,258

 

The Company's profit for the year and total comprehensive income for the year were £1,481,000 (2017: £1,266,000) and £1,481,000 (2017: £1,266,000) respectively.

JAMES LATHAM PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Attributable to the owners of the parent company

 


 

 

Issued capital

Share-based payment reserve

 

 

Own shares

 

 

Capital reserve

 

 

Retained

earnings

 

 

Total

Equity


£'000

£'000

£'000

£'000

£'000

£'000

Balance at 1 April 2016 - audited

5,040

56

(441)

3

66,525

71,183

Profit for the year

-

-

-

-

10,981

10,981

Other comprehensive income:







Actuarial loss on defined benefit pension scheme

-

-

-

-

(7,543)

(7,543)

Deferred tax relating to components of other comprehensive income

 

-

 

-

 

-

 

-

 

1,358

 

1,358

 

Total comprehensive income for the year

-

-

-

-

4,796

4,796

Transactions with owners:







Dividends

-

-

-

-

(2,894)

(2,894)

Write down on conversion of ESOP shares

-

-

52

-

(52)

-

Exercise of options

-

(19)

-

-

19

-

Deferred tax on share options

-

-

-

-

4

4

Change in investment in ESOP shares

-

-

98

-

-

98

Share-based payment expense

-

71

-

-

-

71

Total transactions with owners

-

52

150

-

(2,923)

(2,721)

Balance at 31 March 2017 - audited

5,040

108

(291)

3

68,398

73,258

Profit for the year

-

-

-

-

12,646

12,646

Other comprehensive income:







Actuarial gain on defined benefit pension scheme

-

-

-

-

7,948

7,948

Deferred tax relating to components of other comprehensive income

-

-

-

-

(1,262)

(1,262)

Total comprehensive income for the year

-

-

-

-

19,332

19,332

Transactions with owners:







Dividends

-

-

-

-

(3,014)

(3,014)

Exercise of options

-

(19)

-

-

19

-

Transfer of treasury shares

-

-

(414)

-

414

-

Deferred tax on share options

-

-

-

-

(43)

(43)

Write down on conversion of ESOP shares

-

-

15

-

(15)

-

Change in investment in ESOP shares

-

-

161

-

-

161

Share-based payment expense

-

95

-

-

-

95

Total transactions with owners

-

76

(238)

-

(2,639)

(2,801)

Balance at 31 March 2018 - audited

5,040

184

(529)

3

85,091

89,789



JAMES LATHAM PLC

CONSOLIDATED CASH FLOW STATEMENT
For the year to 31 March 2018


Audited

Audited


2018

2017


£000

£000

Net cash flow from operating activities



Cash generated from operations

11,251

11,902

Interest paid

(1)

(2)

Income tax paid

(2,797)

(2,646)

Net cash inflow from operating activities

8,453

9,254

 



Cash flows from investing activities



Interest received and similar income

37

56

Purchase of property, plant and equipment

(10,840)

(6,045)

Proceeds from sale of property, plant and equipment

 

2,186

 

122

Net cash outflow from investing activities

(8,617)

(5,867)

 



Cash flows from financing activities



Equity dividends paid

(3,014)

(2,894)

Preference dividend paid

(79)

(79)

Net cash outflow from financing activities

(3,093)

(2,973)

(Decrease)/increase in cash and cash equivalents for the year

 

(3,257)

 

414

Cash and cash equivalents at beginning of the year

 

17,246

 

16,832

Cash and cash equivalents at end of the year

13,989

17,246

 

 

 

 

 

 

 



JAMES LATHAM PLC

 

Notes to the audited preliminary financial information

 

1.   The preliminary financial information presented in this report is audited and has been prepared in accordance with the recognition and measurement principles of International Financial Reporting Standards ('IFRS') as adopted by the EU set out in the Group accounts for the years ended 31 March 2017 and 31 March 2018, and does not contain all the information to be disclosed in financial statements prepared in accordance with IFRS.

 

2.   The directors propose a final dividend of 12.1p per ordinary share, which will absorb £2,379,000 (2017: 10.85p absorbing £2,127,000), payable on 24 August 2018 to shareholders on the Register at the close of business on 3 August 2018.  The ex-dividend date is 2 August 2018.

 

The figures for the year ended 31 March 2018 and as at 31 March 2018 have been extracted from the audited statutory accounts for that year, which have yet to be delivered to the Registrar of Companies and which have been prepared in accordance with IFRS as adopted by the EU and those parts of the Companies Act 2006 that remain applicable to companies reporting under IFRS.  The preliminary financial information does not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006, and does not contain all the information required to be disclosed in a full set of IFRS financial statements.

 

Statutory accounts for the year ended 31 March 2018 will be delivered to the Registrar of Companies and sent to Shareholders shortly.  The Annual Report and Accounts may also be viewed in due course on James Latham plc's website at www.lathams.co.uk

 

The audit report on the statutory financial statements for the year ended 31 March 2018 is unqualified and does not include reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report  and does not contain any statement under Section 498(2) or (3) of the Companies Act 2006.

 

Statutory accounts for the year ended 31 March 2017 have been filed with the Registrar of Companies.  The auditor's report on those accounts was unqualified and did not include reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report  and did not contain a statement under section 498(2) and (3) of the Companies Act 2006.

 

3.   This announcement was approved and authorised for issue by the Board of Directors on 27 June 2018.

 

4.   Net cash flow from operating activities



Year to 31 March 2018 audited

Year to 31 March 2017 audited



£000

£000





Profit before tax


15,216

13,827

Adjustment for finance income and cost


451

352

Depreciation, amortisation and impairment


1,941

1,822

Profit on disposal of property, plant and equipment


(1,444)

(95)

Write down of intangible asset


-

86

Increase in inventories


(4,560)

(2,105)

Increase in receivables


(1,432)

(4,788)

Increase in payables


1,526

3,536

Retirement benefits non cash amounts


(703)

(902)

Share-based payments non cash amounts


95

71

Own shares non cash amounts


161

98

Cash generated from operations


11,251

11,902





 

 

5.   The Annual General Meeting of James Latham plc will be held at Unit 1 Swallow Park, Finway Road, Hemel Hempstead, Herts, HP2 7QU on 22 August 2018 at 12.30pm.


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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Final Results - RNS