Regulatory Story
Go to market news section View chart   Print
RNS
Macfarlane Group PLC  -  MACF   

Half-year Report

Released 07:00 23-Aug-2018

RNS Number : 6204Y
Macfarlane Group PLC
23 August 2018
 

 

 

23 August 2018

 

MACFARLANE GROUP'S INTERIM RESULTS FOR THE SIX MONTHS TO 30 JUNE 2018

Financial Highlights £000

2018

2017

Year on Year Change

 

 

 

 

Group turnover

£102,007

£89,824

+14%

Profit before tax

£3,526

£2,535

+39%

Interim dividend

0.65p

0.60p

+8%

Diluted earnings per share

1.81p

1.52p

+19%

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

Stuart Paterson, Chairman of Macfarlane Group PLC, today said: -

"Macfarlane Group has performed well in the first half of 2018.  Group sales of £102.0m, were 14% ahead of the comparable period last year and profit before tax of £3.5m, was 39% higher than in 2017.  This strong performance in the first six months of 2018, supplemented by the expected seasonal uplift from the e-commerce sector in the second half of the year, gives the Board confidence that its full year expectations for 2018 will be achieved.

Packaging Distribution grew its sales by 14% in the first half of 2018, with 5% achieved from organic growth and the remainder from the 2017 acquisition of Greenwoods, which is performing well.  Gross margin in Packaging Distribution rose to 29.3%, (2017: 29.0%).  Operating profit for the division at £3.7m was £1.0m ahead of 2017, an increase of 39%.

Sales in our Manufacturing Operations were 11% above 2017, with strong demand for composite packs for export markets.  Both manufacturing businesses experienced lower gross margins as a result of increased raw material prices and unfavourable sales mix, resulting in operating profit of £0.2m, slightly below that achieved in 2017.

After charging net interest of £0.4m, (2017: £0.4m), the Group profit before tax grew by 39% to £3.5m (2017: £2.5m).

Net debt at 30 June 2018 was £11.1m, £3.6m below the level of £14.7m at 31 December 2017.  The Group is operating well within its existing bank facility of £30.0m.  Consistent with our normal pattern, we expect to be strongly cash generative from trading in the second half of 2018, enabling us to finance up to £4.0m in deferred consideration as forecast, relating to the acquisitions of Nelsons for Cartons and Packaging Limited and Greenwoods Stock Boxes, made in earlier years.  Both of these companies are continuing to trade strongly.

On 31 July 2018 and 2 August 2018, we concluded the acquisitions of Tyler Packaging (Leicester) Limited ("Tyler") and Harrisons Packaging Limited ("Harrisons"), two successful packaging distributors, based in Leicester and Leyland respectively.  The maximum net cash consideration including deferred payments for both acquisitions is estimated to be £3.5m.

The pension scheme deficit reduced to £9.4m at 30 June 2018 from £11.8m at 31 December 2017, mainly due to the continued payment of deficit reduction contributions during the six month period.

The Board is recommending an 8% increase in the interim dividend to 0.65p per share to be paid on 11 October 2018 to shareholders on the register as at 21 September 2018 (2017: 0.60p per share).

Our strategy is to deliver sustainable profit growth by focusing on added value products and services in our target market sectors, combined with the execution of value-enhancing acquisitions.  Macfarlane Group's performance in the first half of 2018 reflects the successful implementation of our strategy and we are confident that the Group will continue to make further progress in the remainder of 2018."

 

Further enquiries:

Macfarlane Group

Tel: 0141 333 9666

 

Stuart Paterson                                Chairman

 

 

Peter Atkinson                                 Chief Executive

 

 

John Love                                          Finance Director

 

 

Spreng Thomson

Tel: 0141 548 5191

 

Callum Spreng

Mob: 07803 970103

 

 

Notes to Editors:

·      Macfarlane Group PLC is headquartered in Glasgow, Scotland, listed on the London Stock Exchange (LSE: MACF) in the Industrials Sector and has more than 60 years' experience in the UK packaging industry

·      Macfarlane Group's businesses are:

Macfarlane Packaging is the leading UK distributor of a comprehensive range of protective packaging products

Labels designs and prints high quality self-adhesive and resealable labels, principally for FMCG companies

Packaging Design and Manufacture designs and produces protective packaging for high value, fragile products

·      Macfarlane Group employs over 900 people at 31 sites, principally in the UK, but also in Ireland and Sweden

·      The company has 20,000+ customers in the UK, Europe and USA providing 600,000+ lines to a wide range of industry sectors including: consumer goods; food manufacturing; logistics; internet retail; mail order; electronics; defence and aerospace

Legal Entity Identifier (LEI):  213800LVRYDERSJAAZ73

 
 
Interim Results - Management Report

Macfarlane Group's trading activities comprise two divisions, Packaging Distribution and Manufacturing Operations.

Macfarlane's Packaging Distribution business is the UK's leading specialist distributor of protective packaging materials.  Macfarlane operates from 23 Regional Distribution Centres ("RDCs") and 3 satellite sites, supplying customers with a comprehensive range of protective packaging materials and services on a local, regional and national basis.  Macfarlane meets the needs of customers by enabling them to ensure their products are cost-effectively protected in transit and storage by offering a comprehensive product range, single source supply, Just-In-Time delivery, tailored stock management programmes, electronic trading and independent advice on both packaging materials and packing processes.

 

2018

2017

 

£000

£000

Sales

89,119

78,055

Cost of sales

62,976

55,427

 

 

 

Gross margin

26,143

22,628

Overheads

22,430

19,958

 

 

 

Operating profit

3,713

2,670

 

 

 

The main features of our first half performance in 2018 were:

l Sales growth of 14% comprised 5% organic growth and additional sales growth of 9% from our 2017 acquisition;

l Strong progress in the development of our National Account business in the industrial sector with incremental business from existing customers in H1 2018;

l Sales to internet retailers accounted for 19% of business in H1 2018.  We continue to develop and win business in this key growth sector and our Innovation Lab in Milton Keynes has supported our sales growth in 2018;

l The Third-party Logistics ("3PL") sector represents 10% of our total business as we continue to strengthen our partnerships with key 3PL operators;

l Gross margin is 29.3% (2017 - 29.0%) reflecting favourable margins in our 2017 acquisition and the recovery of industry-wide input price increases on paper-based products in Q2 2018; and

l Overhead increases in the current year are primarily due to the impact of acquisitions; meanwhile the strong cost control ethos throughout the business remains.

We expect sales to continue to be weighted towards H2 2018 reflecting the proportion of internet retailers in our customer base.  The key areas we shall focus on to support this are:

l Maintaining our focus on the growth potential for protective packaging in key market segments - the e-commerce sector, National Accounts in the industrial sector and 3PL operators;

l Providing UK and pan-European customers requiring our capabilities on a European basis with access to our offering and where appropriate, utilising the benefits of our NovuPak membership;

l Improving our sourcing through stronger relationships with our existing supplier base;

l Continuing the price recovery programme for paper-related input price increases;

l Rolling out the new products introduced to the business from recent acquisitions, particularly Airsac and Shelf-Ready Packaging;

l Pursuing cost-reduction opportunities from productivity improvements and in our property portfolio;

l Maintaining the focus on working capital management to facilitate future growth; and

l Supplementing organic growth by the identification and completion of further suitable high-quality acquisitions.  Our recent acquisitions, Tyler and Harrisons, are good local businesses with a strong customer focus, which are expected to integrate well into the Macfarlane network.

 

Macfarlane's Manufacturing Operations comprise Packaging Design & Manufacture and Labels.

 

2018

2017

 

£000

£000

Sales

14,989

13,553

Cost of sales

10,037

8,650

 

 

 

Gross margin

4,952

4,903

Overheads

4,751

4,625

 

 

 

Operating profit

201

278

 

 

 

We operate the Packaging Design & Manufacture business from two UK sites - Grantham and Westbury - where we design, manufacture and assemble custom-designed packaging solutions for customers requiring cost-effective methods of protecting high value products in storage and transit.  We differentiate ourselves through our technical expertise, design capability, industry accreditations and national capability through the partnership with Macfarlane Packaging Distribution.

Packaging Design & Manufacture sales increased by 16% from last year's levels, with strong growth from customers focusing on export markets.  Actions to reduce operating costs were implemented, which, with the benefit of stronger sales, resulted in profit in H1 2018 being above the same period in 2017.

Our Labels business designs and prints self-adhesive labels for major FMCG customers in the UK and Europe and resealable labels for major customers in the UK, Europe and the USA.  The business operates from production sites in Kilmarnock and Wicklow and a sales and design office in Sweden, which focuses on the development and growth of our resealable labels business, Reseal-it.  More product sectors are adopting the re-sealable label format and this is a key strategic focus for the Labels management team.

In H1 2018 sales at Macfarlane Labels were 6% higher than in 2017 reflecting growth in pre-applied labels in FMCG sectors.  Profit in the first half of 2018 was below that achieved in 2017, due to an unfavourable sales mix, but showed an improved run-rate in the second quarter.

The priorities for the Manufacturing Operations in the second half of 2018 are to:

l Maintain Packaging Design & Manufacture sales growth, particularly in key sectors e.g. Defence, Aerospace and Medical;

l Continue to improve operational efficiency at both Packaging Design & Manufacture sites;

l Prioritise new sales activity on higher added value bespoke composite pack product range;

l Continue to strengthen the relationship between our Packaging Design & Manufacture operations and our Packaging Distribution business to create both sales and cost synergies;

l Accelerate the Reseal-it growth momentum through improved geographic penetration, extending the product range and introducing Reseal-it to new product sectors; and

l Increase self-adhesive label sales with key brands to create a more balanced customer portfolio.

 

 

Summary and Future Prospects

Macfarlane Group's businesses all have strong market positions with differentiated product and service offerings.  We have a flexible business model and a clear strategic plan incorporating a range of actions, which is being effectively implemented and is reflected in consistent, profitable growth and cash-flow generation in recent years.

Our future performance is largely dependent on our own efforts to grow sales, increase efficiencies and bring high quality acquisitions into the Group.  With a focus on the most attractive UK market sectors for our products and services, combined with our successful track record of growth and acquisitions, we expect 2018 to be another successful year for Macfarlane Group.

 

 

Risks and Uncertainties

The principal risks and uncertainties, which could impact on the performance of the Group, were outlined in our Annual Report and Accounts for 2017 (available on our website at www.macfarlanegroup.com) together with the mitigating actions. These remain substantially the same for the remaining six months of the current financial year and are summarised below:

l The Group's businesses are impacted by commodity-based raw material prices and manufacturer energy costs, with profitability sensitive to supplier price changes.  The Group works closely with its supplier and customer base to manage effectively the scale and timing of these price movements and any resultant impact on profit;

l Given the multi-site nature of its business the Group has an extensive property portfolio comprising 3 owned sites and 34 leased sites, 3 of which are sub-let.  The portfolio can give rise to risks in relation to ongoing lease costs, dilapidations and fluctuations in value.  The Group adopts a proactive approach to managing property costs and exposures;

l The Group has a significant investment in working capital in trade receivables and inventories.  There is a risk that this investment is not fully recovered.  Rigour is applied to the management of trade receivables and inventories throughout the Group to mitigate these risks;

l The Group needs continued access to funding to meet its trading obligations and to support organic growth and acquisitions.  There is a risk that the Group may be unable to obtain funds or that such funds will only be available on unfavourable terms.  The Group's borrowing facility comprises a committed facility of £30 million with Lloyds Bank PLC, available until June 2022, which finances our trading requirements and supports controlled expansion, providing a medium-term funding platform for growth;

l In Packaging Distribution, the business model reflects a decentralised approach with a high dependency on effective local decision-making.  There is a risk that local decisions may not always meet overall corporate objectives. This is closely monitored in the Group with regular reviews of performance and prospects for all locations;

l The Group's defined benefit pension scheme is sensitive to a number of key factors; investment returns, discount rates used to calculate the scheme's liabilities and mortality assumptions.  Small changes in these assumptions could cause significant movements in the pension deficit.  The Group has sought to manage the volatility of the pension scheme deficit caused by these factors by undertaking exercises to reduce liabilities, more effectively match the investment profile with the liability profile and making contributions to reduce the deficit; and

l The Group's growth strategy includes acquisitions as a key component.  There are risks that the availability of acquisition candidates may reduce, or that acquisitions may not perform as expected either after acquisition or on integration into the Group.  Having made nine acquisitions since 2014, the Group has well-established due diligence and integration processes and procedures and seeks to acquire quality businesses which will perform well in the Group.

The Group operates a formal framework for the identification and evaluation of the major business risks faced by each business and determines an appropriate course of action to manage these risks.

Cautionary Statement

This announcement has been prepared solely to provide additional information to shareholders to assess the Group's strategy and the potential for the strategy to succeed.  It should not be relied on by any other party or for any other purpose.

This announcement contains certain forward-looking statements relating to operations, performance and financial status.  Such statements involve risk and uncertainty because they relate to events and depend upon circumstances that will occur in the future and should be treated with caution as there are a number of factors, including both economic and business risk factors that could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements.

These statements are made by the directors in good faith based on the information available to them up to the time of their approval of this announcement.  Nothing in this Interim Results Statement should be construed as a profit forecast or an invitation to deal in the securities of the Group.

 

Statement of Directors' Responsibilities

 

The Directors of Macfarlane Group PLC are

S.R. Paterson                    Chairman

P.D. Atkinson                    Chief Executive               

J. Love                                Finance Director

M.R. Arrowsmith             Non-Executive Director/Senior Independent Director

J.W.F. Baird                        Non-Executive Director

R. McLellan                       Non-Executive Director

 

The Directors confirm that, to the best of their knowledge:-

(i)           the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU;

(ii)          the interim management report includes a fair review of the information required by:

a.    DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

b.    DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

 

Approved by the Board of Directors on 23 August 2018 and signed on its behalf by

 

 

 

…………………………..                            ………………………

Peter D. Atkinson                             John Love

Chief Executive                                 Finance Director

 

 

INDEPENDENT REVIEW REPORT TO MACFARLANE GROUP PLC

 

Conclusion

We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2018 which comprises the condensed consolidated income statement, the condensed consolidated statement of comprehensive income, the condensed consolidated statement of changes in equity, the condensed consolidated balance sheet, the condensed consolidated cash flow statement and the related explanatory notes.

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 June 2018 is not prepared, in all material respects, in accordance with IAS 34 Interim Financial Reporting as adopted by the EU and the Disclosure Guidance and Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the UK FCA").

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK.  A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.  We read the other information contained in the half-yearly financial report and consider whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit.  Accordingly, we do not express an audit opinion.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors.  The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FCA.

As disclosed in note 1, the annual financial statements of the group are prepared in accordance with International Financial Reporting Standards as adopted by the EU.  The directors are responsible for preparing the condensed set of financial statements included in the half-yearly financial report in accordance with IAS 34 as adopted by the EU.

Our responsibility

Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

The purpose of our review work and to whom we owe our responsibilities

This report is made solely to the company in accordance with the terms of our engagement to assist the company in meeting the requirements of the DTR of the UK FCA.  Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose.  To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached.

 

 

Hugh Harvie

for and on behalf of KPMG LLP

Chartered Accountants

319 St Vincent Street

Glasgow G2 5AS

23 August 2018

 

MACFARLANE GROUP PLC

CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2018

 

 

 

 

 

 

 

 

 

 

Six

months to

30 June

2018

£000

 

Six

months to

30 June

2017

£000

 

Year

to 31

December

2017

£000

 

Note

 

 

 

 

 

Continuing operations

 

 

 

 

 

 

Revenue

3

102,007

 

89,824

 

195,991

Cost of sales

 

(70,912)

 

(62,293)

 

(135,687)

 

 

 

 

 

 

 

Gross profit

 

31,095

 

27,531

 

60,304

Distribution costs

 

(4,324)

 

(4,000)

 

(8,208)

Administrative expenses

 

(22,857)

 

(20,583)

 

(42,007)

 

 

 

 

 

 

 

Operating profit

3

3,914

 

2,948

 

10,089

Finance costs

4

(388)

 

(413)

 

(828)

 

 

 

 

 

 

 

Profit before tax

 

3,526

 

2,535

 

9,261

Tax

5

(675)

 

(443)

 

(1,837)

 

 

 

 

 

 

 

Profit for the period

3

2,851

 

2,092

 

7,424

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings per share

7

 

 

 

 

 

  Basic

 

1.81p

 

1.53p

 

5.22p

 

 

 

 

 

 

 

  Diluted

 

1.81p

 

1.52p

 

5.22p

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MACFARLANE GROUP PLC

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2018

 

 

 

 

 

 

 

 

 

 

 

 

Six

months to

30 June

2018

£000

 

Six

months to

30 June

2017

£000

 

Year

to 31

December

2017

£000

Items that may be reclassified to profit or loss

Note

 

 

 

 

 

Foreign currency translation differences

 

(26)

 

35

 

45

Items that will not be reclassified to profit or loss

 

 

 

 

 

 

Remeasurement of pension scheme liability

10

979

 

(505)

 

(223)

Tax recognised in other comprehensive income

 

 

 

 

 

 

 Tax on remeasurement of pension scheme liability

11

(166)

 

86

 

38

 

 

 

 

 

 

 

Other comprehensive income/(expense) for the period, net of tax

 

 

787

 

 

(384)

 

 

(140)

Profit for the period

 

2,851

 

2,092

 

7,424

 

 

 

 

 

 

 

Total comprehensive income for the period

 

3,638

 

1,708

 

7,284

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2018

 

 

 

 

Note

Share

Capital

£000

Share

Premium

£000

Revaluation

Reserve

£000

Translation

Reserve

£000

Retained

Earnings

£000

 

Total

£000

 

 

 

 

 

 

 

 

At 1 January 2018

 

39,387

12,975

70

299

4,479

57,210

 

 

 

 

 

 

 

Comprehensive income

 

 

 

 

 

 

 

Profit for the period

 

-

-

-

-

2,851

2,851

Foreign currency translation differences

 

 

-

 

-

 

-

 

(26)

 

-

 

(26)

Remeasurement of pension scheme liability

 

10

 

-

 

-

 

-

 

-

 

979

 

979

Tax on remeasurement of pension scheme liability

 

11

 

-

 

-

 

-

 

-

 

(166)

 

(166)

 

 

 

 

 

 

 

Total comprehensive income

-

-

-

(26)

3,664

3,638

 

 

 

 

 

 

 

Transactions with shareholders

 

 

 

 

 

 

 

Dividends

6

-

-

-

-

(2,363)

(2,363)

 

 

 

 

 

 

 

Total transactions with shareholders

-

-

-

-

(2,363)

(2,363)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 30 June 2018

 

39,387

12,975

70

273

5,780

58,485

 

 

 

 

 

 

 

 

MACFARLANE GROUP PLC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2017

 

 

 

Note

Share

Capital

£000

Share

Premium

£000

Revaluation

Reserve

£000

Translation

Reserve

£000

Retained

Earnings

£000

 

Total

£000

 

 

 

 

 

 

 

 

At 1 January 2017

 

34,084

4,641

70

254

274

39,323

 

 

 

 

 

 

 

Comprehensive income

 

 

 

 

 

 

 

Profit for the period

 

-

-

-

-

2,092

2,092

Foreign currency translation differences

 

 

-

 

-

 

-

 

35

 

-

 

35

Remeasurement of pension scheme liability

 

10

 

-

 

-

 

-

 

-

 

(505)

 

(505)

Tax on remeasurement of pension scheme liability

 

11

 

-

 

-

 

-

 

-

 

86

 

86

 

 

 

 

 

 

 

Total comprehensive income

-

-

-

35

1,673

1,708

 

 

 

 

 

 

 

Transactions with shareholders

 

 

 

 

 

 

 

Dividends

6

-

-

-

-

(1,909)

(1,909)

Credit for share-based payments

 

-

-

-

-

54

54

 

 

 

 

 

 

 

Total transactions with shareholders

-

-

-

-

(1,855)

(1,855)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 30 June 2017

 

34,084

4,641

70

289

92

39,176

 

 

 

 

 

 

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 DECEMBER 2017

 

 

 

Note

Share

Capital

£000

Share

Premium

£000

Revaluation

Reserve

£000

Translation

Reserve

£000

Retained

Earnings

£000

 

Total

£000

 

 

 

 

 

 

 

 

At 1 January 2017

 

34,084

4,641

70

254

274

39,323

 

 

 

 

 

 

 

Comprehensive income

 

 

 

 

 

 

 

Profit for the year

 

-

-

-

-

7,424

7,424

Foreign currency translation differences

 

 

-

 

-

 

-

 

45

 

-

 

45

Remeasurement of pension scheme liability

 

10

 

-

 

-

 

-

 

-

 

(223)

 

(223)

Tax on remeasurement of pension scheme liability

 

11

 

-

 

-

 

-

 

-

 

38

 

38

 

 

 

 

 

 

 

Total comprehensive income

-

-

-

45

7,239

7,284

 

 

 

 

 

 

 

Transactions with shareholders

 

 

 

 

 

 

 

Dividends

6

-

-

-

-

(2,854)

(2,854)

Share-based payments

 

-

-

-

-

(180)

(180)

Issue of share capital

12

5,303

8,334

-

-

-

13,637

 

 

 

 

 

 

 

Total transactions with shareholders

5,303

8,334

-

-

(3,034)

10,603

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At 31 December 2017

 

39,387

12,975

70

299

4,479

57,210

 

 

 

 

 

 

 

MACFARLANE GROUP PLC

CONDENSED CONSOLIDATED BALANCE SHEET (UNAUDITED) AT 30 JUNE 2018

 

 

 

 

 

 

 

 

 

30 June

2018

 

30 June

2017

 

31 December

2017

 

Note

£000

 

£000

 

£000

Non-current assets

 

 

 

 

 

 

Goodwill and other intangible assets

 

56,160

 

43,330

 

57,234

Property, plant and equipment

 

8,647

 

7,961

 

8,630

Other receivables

 

189

 

358

 

296

Deferred tax assets

11

1,998

 

2,691

 

2,407

 

 

 

 

 

 

 

Total non-current assets

 

66,994

 

54,340

 

68,567

 

 

 

 

 

 

 

Current assets

 

 

 

 

 

 

Inventories

 

15,384

 

12,848

 

15,465

Trade and other receivables

 

48,555

 

42,880

 

52,578

Cash and cash equivalents

9

2,576

 

1,212

 

2,013

 

 

 

 

 

 

 

Total current assets

 

66,515

 

56,940

 

70,056

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

3

133,509

 

111,280

 

138,623

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

 

Trade and other payables

 

48,444

 

39,943

 

49,100

Current tax payable

 

604

 

563

 

741

Finance lease liabilities

9

151

 

398

 

245

Bank borrowings

9

13,478

 

15,259

 

16,346

 

 

 

 

 

 

 

Total current liabilities

 

62,677

 

56,163

 

66,432

 

 

 

 

 

 

 

Net current assets

 

3,838

 

777

 

3,624

 

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

Retirement benefit obligations

10

9,418

 

13,419

 

11,823

Deferred tax liabilities

11

2,882

 

1,577

 

3,048

Trade and other payables

 

27

 

778

 

13

Finance lease liabilities

9

20

 

167

 

97

 

 

 

 

 

 

 

Total non-current liabilities

 

12,347

 

15,941

 

14,981

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

75,024

 

72,104

 

81,413

 

 

 

 

 

 

 

 

 

 

 

 

 

Net assets

3

58,485

 

39,176

 

57,210

 

 

 

 

 

 

Equity

 

 

 

 

 

 

Share capital

 

39,387

 

34,084

 

39,387

Share premium

 

12,975

 

4,641

 

12,975

Revaluation reserve

 

70

 

70

 

70

Translation reserve

 

273

 

289

 

299

Retained earnings

 

5,780

 

92

 

4,479

 

 

 

 

 

 

 

Total equity

 

58,485

 

39,176

 

57,210

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MACFARLANE GROUP PLC

CONDENSED CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)

FOR THE SIX MONTHS ENDED 30 JUNE 2018

 

 

 

 

Six

months to

30

June

 

 

Six months to

30 June

 

Year

to 31

December

 

 

Note

2018

£000

 

2017

£000

 

2017

£000

 

 

 

 

 

 

 

Net cash inflow from operating activities

9

6,730

 

4,427

 

6,482

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investing activities

 

 

 

 

 

 

Acquisitions

8

-

 

(246)

 

(8,337)

Proceeds on disposal of property, plant and equipment

24

 

18

 

210

Purchases of property, plant and equipment

 

(789)

 

(829)

 

(1,740)

 

 

 

 

 

 

 

Net cash used in investing activities

 

(765)

 

(1,057)

 

(9,867)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Financing activities

 

 

 

 

 

 

Dividends paid

6

(2,363)

 

(1,909)

 

(2,854)

Proceeds from issue of share capital (net of issue expenses)

 

 

-

 

 

-

 

 

7,637

Repayment of bank facility

 

(2,868)

 

(1,947)

 

(860)

Repayment of finance lease liabilities

 

(171)

 

(232)

 

(455)

 

 

 

 

 

 

 

Net cash (used in)/generated by financing activities

(5,402)

 

(4,088)

 

3,468

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net increase/(decrease) in cash and cash equivalents

563

 

(718)

 

83

 

 

 

 

 

 

 

Cash and cash equivalents at beginning of period

 

2,013

 

1,930

 

1,930

 

 

 

 

 

 

 

Cash and cash equivalents at end of period

9

2,576

 

1,212

 

2,013

 

 

 

 

 

 

 

MACFARLANE GROUP PLC

SIX MONTHS ENDED 30 JUNE 2018

NOTES TO THE CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

 

1.         Basis of preparation

Macfarlane Group PLC is a public company listed on the London Stock Exchange, incorporated and domiciled in the United Kingdom.  The Group's annual financial statements are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU.  Other than as disclosed below, as required by the Disclosure and Transparency Rules of the Financial Conduct Authority, this condensed set of financial statements has been prepared applying the accounting policies that were applied in the preparation of the company's published consolidated financial statements for the year ended 31 December 2017.  This condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU.

This is the first set of Group financial statements where IFRS 15 and IFRS 9 have been applied, both with effect from 1 January 2018.

(i)           The adoption of IFRS 15 Revenue from Contracts with Customers has not resulted in significant changes to the revenue recognition policy applied in the Group's financial statements for the year ended 31 December 2017.  This is due to the nature of the majority of existing customer contracts entered into by the Group recognising revenue at the point of transfer of goods to the customer, consistent with the revenue recognition framework in IFRS 15.  As a result, no adjustments have been made to the 31 December 2017 balance sheet nor to opening retained earnings at 1 January 2018.

(ii)          IFRS 9 Financial Instruments contains provisions for the calculation of impairment losses for doubtful trade receivables.  This has not resulted in any significant changes to the existing methodology used to calculate provisions applied in the Group's 2017 financial statements.  As a result, no adjustments have been made to the 31 December 2017 balance sheet nor to opening retained earnings at 1 January 2018.

The Directors are in the process of evaluating the impact of IFRS 16 Leases in the Group's 2019 financial statements.  The Group's financial commitments under all operating leases at 31 December 2017 are set out in note 22 to the 2017 financial statements.  From 1 January 2019 all operating leases will be reclassified as finance leases under IFRS 16.  Adoption of this standard will result in an increase in gross assets and gross liabilities on the balance sheet and reclassifications of expenditure between operating costs and finance costs in the income statement.  There will be no net cash flow impact arising from the new accounting standard and the Group does not currently intend to alter its approach as to whether assets should be leased or acquired outright going forward.

Judgements, assumptions and estimation uncertainties

In preparing the condensed financial statements, management has made judgements, estimates and assumptions, which affect the application of the Group's accounting policies and the reported amounts of assets, liabilities, income and expenses.  Actual results may differ from the amounts estimated.  Estimates and underlying assumptions are reviewed on an ongoing basis, with revisions to estimates recognised prospectively.

Information about judgements, assumptions and estimation uncertainties made in applying accounting policies that have the most significant effect on the amounts recognised in these financial statements and therefore have the most significant risk of resulting in a material adjustment are as follows:-

(i)           Trade and Other Receivables

The provision for doubtful receivables is based on judgemental estimates over the recoverable amounts

(ii)          Retirement Benefit Obligations

The valuation of the pension deficit is affected by key actuarial assumptions

Business activities, risks and financing

The Group's business activities, together with the factors likely to affect its future development, performance and financial position are set out in the Interim Management Report on pages 1 to 6.

The Group's principal financial risks in the medium term relate to liquidity and credit risk.  Liquidity risk is managed by ensuring that the Group's day-to-day working capital requirements are met by having access to committed banking facilities with suitable terms and conditions to accommodate the requirements of the Group's operations.  Credit risk is managed by applying considerable rigour in managing the Group's trade receivables. The Directors believe that the Group is adequately placed to manage its financial risks effectively in the current economic climate.

The Group's banking arrangements with Lloyds Bank PLC comprise a committed facility of £30 million, expiring in June 2022, secured over part of Macfarlane Group's trade receivables and bearing interest at commercial rates.  The facility has financial covenants for interest cover and over trade receivables headroom.

The Directors are of the opinion that the Group's cash and revenue projections, which they believe are based on prudent market data and past experience taking account of reasonably possible changes in trading performance given current market and economic conditions, show that the Group should be able to operate within its current facilities and comply with its banking covenants.

In assessing the going concern basis, the Directors have considered the Group's business activities, the financial position of the Group and the Group's risks and uncertainties.  The Directors have a reasonable expectation that, despite the current uncertain economic environment, the Company and the Group have adequate resources to continue in operational existence for the foreseeable future.  For this reason this condensed set of financial statements have been prepared on the going concern basis.

Approval and review of condensed financial statements

These condensed financial statements were approved by the Board of Directors on 23 August 2018.

This condensed set of financial statements is unaudited but has been formally reviewed by the auditor and their Independent Review Report to the Company is set out on page 7.

2.         General information

Comparative figures for the financial year ended 31 December 2017 are extracted from Macfarlane Group's statutory accounts for 2017.  Those accounts have been reported on by the Company's auditor and delivered to the Registrar of Companies.  The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

3.         Segmental information

The Group's principal business segment is Packaging Distribution, comprising the distribution of packaging materials and supply of storage and warehousing services in the UK.  The remaining operations for the manufacture and supply of self-adhesive and resealable labels to a variety of FMCG customers in the UK, Europe and USA and the design, manufacture and assembly of timber, corrugated and foam-based packaging materials in the UK comprise one segment headed Manufacturing Operations.  No individual business segment within Manufacturing Operations represents more than 10% of Group revenue or profit in each period presented.

 

 

 

Trading results - continuing operations

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year ended

31 December

2017

£000

 

 

 

 

Packaging Distribution

 

 

 

Revenue

89,119

78,055

171,771

Cost of sales

(62,976)

(55,427)

(121,323)

 

 

 

 

Gross profit

26,143

22,628

50,448

Net operating expenses

(22,430)

(19,958)

(41,012)

 

 

 

 

Operating profit

3,713

2,670

9,436

 

 

 

 

 

 

 

 

Manufacturing Operations

 

 

 

Revenue

14,989

13,553

28,191

Cost of sales

(10,037)

(8,650)

(18,335)

 

 

 

 

Gross profit

4,952

4,903

9,856

Net operating expenses

(4,751)

(4,625)

(9,203)

 

 

 

 

Operating profit

201

278

653

 

 

 

 

 

 

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

Group segment - total revenue

 

 

 

Packaging Distribution

89,119

78,055

171,771

Manufacturing Operations

14,989

13,553

28,191

Inter-segment revenue

(2,101)

(1,784)

(3,971)

 

 

 

 

External revenue - continuing operations

102,007

89,824

195,991

 

 

 

 

Operating profit - continuing operations

 

 

 

Packaging Distribution

3,713

2,670

9,436

Manufacturing Operations

201

278

653

 

 

 

 

Operating profit

3,914

2,948

10,089

Finance costs                     (see note 4)

(388)

(413)

(828)

 

 

 

 

Profit before tax

3,526

2,535

9,261

Tax                                         (see note 5)

(675)

(443)

(1,837)

 

 

 

 

Profit for the period

2,851

2,092

7,424

 

 

 

 

The Packaging Distribution business has historically benefited from additional demand in the final months of the year, resulting in revenue and profitability at higher levels in the second half of the year.

 

30 June

2018

£000

30 June

2017

£000

31 December

2017

£000

Total assets

 

 

 

Packaging Distribution

117,732

96,872

124,069

Manufacturing Operations

15,777

14,408

14,554

 

 

 

 

Total assets

133,509

111,280

138,623

 

 

 

 

Net assets

 

 

 

Packaging Distribution

50,858

32,342

49,745

Manufacturing Operations

7,627

6,834

7,465

 

 

 

 

Net assets

58,485

39,176

57,210

 

 

 

 

 

4.         Finance costs

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

 

 

 

 

Interest on bank borrowings

(239)

(214)

(462)

Interest on obligations under finance leases

(11)

(15)

(18)

Net interest expense on retirement benefit obligation (see note 10)

(138)

(184)

(348)

 

 

 

 

Total finance costs

(388)

(413)

(828)

 

 

 

 

 

5.         Tax

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

Current tax

 

 

 

   UK corporation tax

(611)

(327)

(1,551)

   Overseas tax

(29)

(12)

(62)

   Prior year adjustments

42

49

49

 

 

 

 

Total current tax

(598)

(290)

(1,564)

Total deferred tax                                                           (See note 11)

(77)

(153)

(273)

 

 

 

 

Total

(675)

(443)

(1,837)

 

 

 

 

Tax for the first six months has been charged at 19.00% (2017 - 19.25%) representing the best estimate of the effective tax charge for the full year.

6.         Dividends

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

Amounts recognised as distributions to equity holders in the period

 

 

Final Dividend     (1.50p per share)         (2017     1.40p per share)

2,363

1,909

1,909

Interim Dividend                                             (2017     0.60p per share)

-

-

945

 

 

 

 

Distributions in the period

2,363

1,909

2,854

 

 

 

 

An interim dividend of 0.65p per share, payable on 11 October 2018 was declared on 23 August 2018 and has therefore not been included as a liability in these condensed financial statements.

7.         Earnings per share

 

 

Earnings

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

Earnings from continuing operations for the purposes of earnings per share being profit for the year from continuing operations

 

2,851

 

2,092

 

7,424

 

 

 

 

 

 

 

 

 

30 June

2018

30 June

2017

31 December 2017

Number of shares '000

 

 

 

Weighted average number of shares in issue for the

purposes of basic earnings per share

 

157,548

 

136,335

 

142,228

Effect of dilutive potential ordinary shares due to share options

-

967

-

 

 

 

 

Weighted average number of shares in issue for the

purposes of diluted earnings per share

 

157,548

 

137,302

 

142,228

 

 

 

 

 

 

 

 

Basic Earnings per share

1.81p

1.53p

5.22p

 

 

 

 

Diluted Earnings per share

1.81p

1.52p

5.22p

 

 

 

 

 

8.         Acquisitions

On 21 September 2017, the Group's subsidiary, Macfarlane Group UK Limited, acquired the packaging business and selected assets of Almadon Limited (formerly Greenwoods Stock Boxes Limited) and 100% of the issued share capital of Nottingham Recycling Limited, for a total consideration of approximately £17.22 million.  £7.97 million was paid in cash on acquisition, and £6.0 million was settled by the issue of shares.  The deferred consideration of £3.25 million is payable in the final quarter of 2018, subject to certain trading targets being met in the twelve month period ending on 20 September 2018.

On 29 July 2016, the Group acquired 100% of Nelsons for Cartons & Packaging Limited for a total consideration of £7.2 million.  £4.7 million was paid in cash on acquisition with £1.0 million settled by the issue of shares.  Of the deferred consideration of £1.5 million, £0.75 million was paid in the final quarter of 2017 and £0.75 million will be paid in the third quarter of 2018.

Both businesses are packaging distributors, accounted for in the Packaging Distribution segment.  Goodwill arising on these acquisitions is attributable to the anticipated future profitability of the distribution of the Group's product ranges in the UK and anticipated operating synergies from future combinations of activities with the existing Packaging Distribution network.  All deferred consideration is recognised in liabilities at the respective reporting dates.  Fair values assigned to net assets acquired and consideration paid and payable are set out below:-

 

 

 

Net assets acquired

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

 

 

 

 

Other intangible assets

-

-

9,185

Property, plant and equipment

-

-

712

Inventories

-

-

1,109

Trade and other receivables

-

-

2,736

Cash and bank balances

-

-

625

Trade and other payables

-

-

(1,179)

Current tax liabilities

-

-

(12)

Deferred tax liabilities

-

-

(1,587)

 

 

 

 

Net assets acquired

-

-

11,589

Goodwill arising on acquisition

-

-

5,627

 

 

 

 

Total consideration

-

-

17,216

 

 

 

 

Contingent consideration on acquisitions

 

 

 

   Current year

-

-

(3,250)

   Prior years

-

246

996

Shares

-

-

(6,000)

 

 

 

 

Total cash consideration

-

246

8,962

 

 

 

 

Net cash outflow arising on acquisition

 

 

 

Cash consideration

-

(246)

(8,962)

Cash and bank balances acquired

-

-

625

 

 

 

 

Net cash outflow

-

(246)

(8,337)

 

 

 

 

 

 

9.         Notes to the cash flow statement

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

 

 

 

 

Operating profit

3,914

2,948

10,089

Adjustments for:

 

 

 

      Amortisation of intangible assets

1,074

672

1,580

      Depreciation of property, plant and equipment

762

629

1,391

      Gain on disposal of property, plant and equipment

(14)

(9)

5

 

 

 

 

Operating cash flows before movements in working capital

5,736

4,240

13,065

 

 

 

 

      Decrease/(increase) in inventories

81

138

(1,370)

      Decrease/(increase) in receivables

4,130

5,737

(1,163)

      (Decrease)/increase in payables

(668)

(2,905)

1,570

      Employer pension contributions less current service costs                                      recognised in the income statement

 

(1,564)

 

(1,807)

 

(3,285)

 

 

 

 

Cash generated from operations

7,715

5,403

8,817

 

 

 

 

      Income taxes paid

(735)

(747)

(1,855)

      Interest paid

(250)

(229)

(480)

 

 

 

 

Net cash inflow from operating activities

6,730

4,427

6,482

 

 

 

 

Movement in net debt

 

 

 

Increase/(decrease) in cash and cash equivalents

563

(718)

83

Decrease in bank borrowings

2,868

1,947

860

Cash flows from payment of finance lease liabilities

171

232

455

 

 

 

 

Movement in net debt in the period

3,602

1,461

1,398

Opening net debt

(14,675)

(16,073)

(16,073)

 

 

 

 

Closing net debt

(11,073)

(14,612)

(14,675)

 

 

 

 

Net debt comprises:-

 

 

 

Cash and cash equivalents

2,576

1,212

2,013

Bank borrowings

(13,478)

(15,259)

(16,346)

 

 

 

 

Net bank debt

(10,902)

(14,047)

(14,333)

Finance lease liabilities

 

 

 

         Due within one year

(151)

(398)

(245)

         Due outwith one year

(20)

(167)

(97)

 

 

 

 

Closing net debt

(11,073)

(14,612)

(14,675)

 

 

 

 

Cash and cash equivalents (which are presented as a single class of asset on the balance sheet) comprise cash at bank and other short-term highly liquid investments with maturity of three months or less.

 

10.       Retirement benefit obligations

The figures below have been prepared by Aon Hewitt and are based on the results of the triennial actuarial valuation as at 1 May 2017, updated to 30 June 2018 and 31 December 2017 and the actuarial valuation at 1 May 2014 updated to 30 June 2017.  The assets in the scheme and the net liability position of the scheme as calculated under IAS 19 are as follows:

 

Investment class

30 June

2018

£000

30 June

2017

£000

31 December

2017

£000

Equities

 

 

 

UK equity funds

7,182

7,129

7,034

Overseas equity funds

10,704

10,354

10,660

Multi-asset diversified funds

19,865

21,872

21,533

Bonds

 

 

 

Liability-driven Investment funds

28,742

26,526

28,534

Other

 

 

 

European loan fund

6,603

6,476

6,562

Secured property income fund

6,859

6,330

6,606

Cash

288

343

31

 

 

 

 

Fair value of Scheme investments

80,243

79,030

80,960

Present value of Scheme liabilities

(89,661)

(92,449)

(92,783)

 

 

 

 

Pension scheme deficit

(9,418)

(13,419)

(11,823)

Deferred tax asset (see note 11)

1,601

2,281

2,010

 

 

 

 

Pension scheme deficit net of related deferred tax asset

(7,817)

(11,138)

(9,813)

 

 

 

 

These amounts were calculated using the following principal assumptions as required under IAS 19:

Assumptions

30 June 2018

30 June 2017

31 December 2017

Discount rate

2.60%

2.60%

2.50%

Rate of increase in pensionable salaries

0.00%

0.00%

0.00%

Rate of increase in pensions in payment

3% or 5%

for fixed increases

or 3.10% for LPI

3% or 5%

for fixed increases

or 3.20% for LPI

3% or 5%

for fixed increases

or 3.20% for LPI

Inflation assumption (RPI)

3.20%

3.30%

3.30%

Inflation assumption (CPI)

2.20%

2.30%

2.30%

Life expectancy beyond normal retirement age of 65

 

 

Male

23.8 years

22.9 years

23.7 years

Female

25.8 years

25.4 years

25.7 years

LPI represents limited price indexation applied to pensions in payment.

 

30 June

2018

£000

30 June

2017

£000

31 December

2017

£000

Movement in scheme deficit in the period

 

 

 

At start of period

(11,823)

(14,537)

(14,537)

Current service cost

(65)

(61)

(105)

Employer contributions

1,629

1,868

3,390

Net finance cost

(138)

(184)

(348)

Remeasurement of pension scheme liability in the period

979

(505)

(223)

 

 

 

 

At end of period

(9,418)

(13,419)

(11,823)

 

 

 

 

 

Sensitivity to key assumptions

Key assumptions used for IAS 19 are discount rate, inflation and mortality.  If different assumptions were used, then this could have a material effect on the deficit.  Assuming all other assumptions are held static then a movement in the following key assumptions would affect the level of the deficit as shown below:-

 

Assumptions

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

 

 

 

 

Discount rate movement of +0.1%

1,435

1,572

1,485

Inflation rate movement of +0.1%

(359)

(370)

(473)

Mortality movement of +0.1 year in age rating

267

276

278

Positive figures reflect a reduction in scheme liabilities and therefore a reduction in the scheme deficit.  The sensitivity information has been prepared using the same method as adopted when adjusting the results of the latest funding valuation to the balance sheet date and is consistent with the approach adopted in previous years.

 

Six months

to 30 June

2018

£000

Six months

to 30 June

2017

£000

Year to 31

December

2017

£000

Movement in fair value of Scheme investments

 

 

 

Scheme investments at start of period

80,960

77,808

77,808

Interest income

1,007

1,045

2,065

Return on scheme assets (exc. amounts shown in interest income)

(877)

1,004

3,730

Contributions from sponsoring companies

1,629

1,868

3,390

Contribution from scheme members

36

36

72

Benefits paid

(2,512)

(2,731)

(6,105)

 

 

 

 

Scheme investments at end of period

80,243

79,030

80,960

 

 

 

 

Movement in present value of defined benefit obligations

 

 

 

Obligations at start of period

(92,783)

(92,345)

(92,345)

Current service cost

(65)

(61)

(105)

Interest cost

(1,145)

(1,229)

(2,413)

Contribution from scheme members

(36)

(36)

(72)

Changes in assumptions underlying the defined benefit obligations

 

1,856

 

(1,509)

 

(3,953)

Benefits paid

2,512

2,731

6,105

 

 

 

 

Obligations at end of period

(89,661)

(92,449)

(92,783)

 

 

 

 

Investments

The Trustees review the scheme investments regularly and consult with the Company regarding any proposed changes.  There were no major changes in the investment profile in the first half of 2018.

Funding

Following the completion of the triennial actuarial valuation at 1 May 2017, Macfarlane Group PLC is paying deficit reduction contributions in agreement with the scheme trustees with a deficit recovery period of 7 years.  Contributions in 2018 are expected to be £2.95m.  The next triennial actuarial valuation of the scheme is due at 1 May 2020.

 

11.       Deferred tax

Tax losses less

accelerated capital allowances

£000

 

Other intangible assets

£000

 

Retirement

Benefit

Obligations

£000

 

 

 

Total

£000

 

 

 

 

 

At 1 January 2017

247

(1,537)

2,471

1,181

Credited/(charged) in income statement

 

 

 

 

                Current period

3

120

(276)

(153)

Credited in other comprehensive income

-

-

86

86

 

 

 

 

 

At 30 June 2017

250

(1,417)

2,281

1,114

Acquisitions

(25)

(1,562)

-

(1,587)

(Charged)/credited in income statement

 

 

 

 

            Current period

(59)

162

(223)

(120)

Credited in other comprehensive income

-

-

(48)

(48)

 

 

 

 

 

At 1 January 2018

166

(2,817)

2,010

(641)

(Charged)/credited in income statement

 

 

 

 

                Current period

(17)

183

(243)

(77)

Credited in other comprehensive income

-

-

(166)

(166)

 

 

 

 

 

At 30 June 2018

149

(2,634)

1,601

(884)

 

 

 

 

 

 

 

 

 

 

Deferred tax assets

397

-

1,601

1,998

 

 

 

 

 

Deferred tax liabilities

(248)

(2,634)

-

(2,882)

 

 

 

 

 

At 30 June 2018

149

(2,634)

1,601

(884)

 

 

 

 

 

12.          Related party transactions

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed.

Details of individual and collective remuneration of the Company's Directors and dividends received by the Directors for calendar year 2018 will be disclosed in the Group's 2018 Annual Report.

The directors are satisfied that there are no other related party transactions occurring during the six month period which require disclosure.

13.          Post balance sheet events

On 31 July 2018, the Company's subsidiary, Macfarlane Group UK Limited, concluded the acquisition of Tyler Packaging (Leicester) Limited, a packaging distributor based in Leicester and on 2 August 2018 concluded the acquisition of Harrisons Packaging Limited, a packaging distributor based in Leyland.  The combined turnover for both businesses is projected to be £6.0m in the year after acquisition.

The maximum consideration for both acquisitions will be £4.6m.  The initial cash considerations totalled £3.0m.  The acquisitions have deferred considerations totalling £1.6m payable in the second half of 2019, subject to certain trading targets being achieved in the twelve month period ending on 31 July 2019.

14.          Interim Report

The interim report will be posted to shareholders on 10 September 2018.  Copies will be available from the registered office, 21 Newton Place, Glasgow G3 7PY and available on the Company's website, www.macfarlanegroup.com, from that date.


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.
 
END
 
 
IR BLGDILUDBGID
Close


London Stock Exchange plc is not responsible for and does not check content on this Website. Website users are responsible for checking content. Any news item (including any prospectus) which is addressed solely to the persons and countries specified therein should not be relied upon other than by such persons and/or outside the specified countries. Terms and conditions, including restrictions on use and distribution apply.

 


Half-year Report - RNS