TIDMAVON
RNS Number : 1296X
Avon Rubber PLC
04 May 2016
News Release
Strictly embargoed until 07:00 4 May 2016
AVON RUBBER p.l.c.
("Avon", the "Group" or the "Company")
Unaudited interim results for the six months ended 31 March
2016
31 March Increase
31 March 2016 2015
GBPMillions GBPMillions
REVENUE 66.3 62.8 5%
ADJUSTED EBITDA (*) 13.2 12.2 9%
ADJUSTED OPERATING PROFIT (*) 9.0 8.5 6%
ADJUSTED PROFIT BEFORE TAX (*) 8.8 8.4 5%
NET (DEBT)/CASH (8.4) 7.3
EARNINGS PER SHARE:
Adjusted basic (*) 28.7p 22.3p 29%
Adjusted diluted (*) 28.1p 21.7p 29%
INTERIM DIVIDEND 3.16p 2.43p 30%
FINANCIAL HIGHLIGHTS
-- Operating profit growth of 6%
-- Diluted earnings per share increased 29%
-- Return on sales (EBITDA divided by revenue) improved 0.5% from 19.4% to 19.9%
-- Continuing healthy conversion of operating profit to operating cash at 163%
-- Net debt reduced by GBP4.8m during H1 to GBP8.4m, after the
GBP3.5m cash acquisition of Argus
-- Dividend of 3.16p per share up 30%
OPERATIONAL HIGHLIGHTS
-- Acquisition of Argus in October 2015 broadened Protection & Defence product range
-- Successful integration of InterPuls and Argus into the organisation
-- Delivered 107,000 M50 mask systems under our long-term sole source DOD contract
-- Military order pipeline healthy, timing of receipt remains difficult to predict
-- Milkrite brand continues to grow in cyclically softer dairy market conditions
-- Cluster Exchange now servicing 446,000 cows on 1,411 farms
Rob Rennie, Chief Executive commented:
"Avon has enjoyed another positive half year, successfully
integrating our recent acquisitions which broaden our product range
and routes to market. In Dairy, whilst market conditions have, as
previously highlighted, reflected cyclically low milk prices, we
are encouraged that our own brand Milkrite products and Cluster
Exchange service have continued to gain market share.
Trading is normally second-half weighted in our Protection &
Defence business and we believe this will again be the case this
year. We have a strong forward order book for DOD M50s and a
growing pipeline of non-DOD opportunities.
The Board therefore expects to make progress as the year
develops and meet market expectations for the full year."
(*) Note:
The Directors believe that adjusted measures provide a more
useful comparison of business trends and performance. Adjusted
results exclude exceptional items, defined benefit pension scheme
costs and the amortisation of acquired intangibles. The term
adjusted is not defined under IFRS and may not be comparable with
similarly-titled measures used by other companies.
All profit and earnings per share figures in these interim
results relate to adjusted business performance (as defined above)
unless otherwise stated. A reconciliation of adjusted measures to
non-adjusted measures is provided below:
Statutory Adjustments Adjusted
--------------------------------------- ---------- ------------ ---------
Group EBITDA (GBPm) 12.5 0.7 13.2
--------------------------------------- ---------- ------------ ---------
Group operating profit (GBPm) 6.6 2.4 9.0
--------------------------------------- ---------- ------------ ---------
Other finance expense (GBPm) 0.4 (0.3) 0.1
--------------------------------------- ---------- ------------ ---------
Group profit before taxation (GBPm) 6.1 2.7 8.8
--------------------------------------- ---------- ------------ ---------
Taxation (GBPm) (0.4) 0.5 0.1
--------------------------------------- ---------- ------------ ---------
Group profit for the period (GBPm) 6.5 2.2 8.7
--------------------------------------- ---------- ------------ ---------
Basic earnings per share (pence) 21.6 7.1 28.7
--------------------------------------- ---------- ------------ ---------
Diluted earnings per share (pence) 21.2 6.9 28.1
--------------------------------------- ---------- ------------ ---------
Protection & Defence operating profit
(GBPm) 5.3 1.3 6.6
--------------------------------------- ---------- ------------ ---------
Dairy operating profit (GBPm) 2.6 0.8 3.4
--------------------------------------- ---------- ------------ ---------
The adjustments comprise:
-- exceptional items of GBP0.5m relating to acquisition integration costs
-- amortisation of acquired intangibles of GBP1.7m
-- defined benefit pension scheme costs which relate to a scheme
closed to future accrual and therefore do not relate to current
operations:
-- administrative expenses of GBP0.2m
-- other finance expense of GBP0.3m
-- tax effect of adjustments of GBP0.5m
Avon Rubber p.l.c.
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Rob Rennie, Chief Executive: 020 7067 0000 (until 12 noon today)
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Andrew Lewis, Group Finance Director: 01225 896 830
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Sarah Matthews-DeMers, Associate Group Finance Director: 01225
896 835
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Weber Shandwick Financial
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Nick Oborne: 020 7067 0000
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An analyst meeting will be held at 9.30am this morning at the
offices of Weber Shandwick Financial, 2 Waterhouse Square, 140
Holborn, London, EC1N 2AE.
NOTES TO EDITORS:
The Group has transformed itself over recent years into an
innovative design and engineering group, specialising in two core
markets, Protection & Defence and Dairy. With a strong emphasis
on research and development, we design, test and manufacture
specialist products from a number of sites in the US and Europe,
serving markets around the world. We achieve this through nurturing
the talent and aspirations of our employees to realise their
highest potential.
Avon Protection Systems is the recognised global market leader
in advanced Chemical, Biological, Radiological and Nuclear (CBRN)
respiratory protection systems for the world's military, homeland
security, first responder, fire and industrial markets. With an
unrivalled pedigree in mask design dating back to the 1920's, Avon
Protection Systems' advanced products are the first choice for
Personal Protective Equipment (PPE) users worldwide and are placed
at the heart of many international defence and tactical PPE
deployment strategies. Our expanding global customer base now
includes military forces, civil and first line defence troops,
emergency service teams and industrial, marine, mineral and oil
extraction site personnel. All put their trust in Avon's advanced
respiratory solutions to shield them from every possible threat
whether land, air or sea based.
Our world-leading Dairy supplies business and its Milkrite and
InterPuls brands have a global market presence. With a long history
of manufacturing liners and tubing for the dairy industry, we have
become the leading innovator and designer for products and services
right at the heart of milking. The acquisition of InterPuls in
2015, a specialist in electro-mechanical milking components, such
as pulsators, milk meters, automatic cluster removers, milking
clusters, washing systems, vacuum pumps, bucket milkers and
pipeline system components, has added significantly to our product
range, making us the complete milking point solutions provider.
Working with leading scientists and health specialists in the
global dairy industry, we continue to invest in technology to
further improve the milking process and animal welfare. Our
products provide exceptional results for both the animal and the
milker, making the milk extraction process more efficient. As our
market share and milking experience continue to improve, so does
our global presence.
For further information please visit the Group's website:
www.avon-rubber.com
Interim Management Report
Introduction
Avon has enjoyed another positive half year, successfully
integrating our recent acquisitions which broaden our product range
and routes to market.
In Protection & Defence revenues for the half year were, as
planned, weighted towards US Department of Defense (DOD) sales
under our ten year sole source contract against which we received
an additional order for 167,000 M50s, giving us a strong forward
order book for DOD mask systems. We also have a growing pipeline of
higher margin non-DOD opportunities in the Americas and the Middle
East for which the timing of order receipt remains unpredictable,
although we believe the time horizon for some of these
opportunities is shortening.
In Dairy, whilst market conditions have, as previously
highlighted, reflected cyclically low milk prices, we are
encouraged that our own brand Milkrite products and Cluster
Exchange service have continued to gain market share.
Group Results
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Group revenue at GBP66.3m (2015: GBP62.8m) increased by 5% and
operating profit of GBP9.0m (2015: GBP8.5m) increased by 6%.
Earnings before interest, tax, depreciation and amortisation
('EBITDA') increased by 9% to GBP13.2m (2015: GBP12.2m)
representing a return on sales (defined as EBITDA divided by
revenue) of 19.9% (2015: 19.4%).
The impact of foreign exchange translation was a slight tailwind
of GBP0.4m as the $/GBP average rate of $1.46 was lower than the
$1.54 prevailing in the same period last year. This translation
benefit has, for the most part, been offset by transactional
losses, where Euro and US dollar transactions, covered by forward
contracts at rates higher than the period rate, have given rise to
mark to market foreign exchange losses of GBP0.3m at the period
end.
If the currently stronger US dollar were to prevail throughout
the remainder of the financial year, it would create further
translation tailwinds for the full year. Our sensitivity analysis
on the full year 2015 results showed that a 5c movement in the
$/GBP exchange rate would result in a GBP0.7m impact on annual
operating profit.
Profit before tax was GBP8.8m (2015: GBP8.4m) and after a tax
charge of GBP0.1m (2015: GBP1.7m), an effective rate of 1% (2015:
20%), the Group recorded a profit for the period after tax of
GBP8.7m (2015: GBP6.7m). The reduced tax rate reflects the
anticipated geographic split of taxable profits for 2016, the
finalisation of the 2015 tax returns and the positive outcome of
certain tax enquiries. Basic earnings per share were up 29% at
28.7p (2015: 22.3p) and fully diluted earnings per share were up
29% at 28.1p (2015: 21.7p).
Net Debt and Cashflow
Net debt at the half year was GBP8.4m, down from GBP13.2m at the
2015 year end and after the GBP3.5m cash payment to acquire Argus
in October 2015.
Operating cash conversion continues to be strong at 163% of
operating profit. Turning profits into cash has enabled us to
continue to invest in the future of the business with GBP3.8m of
capital investment, while increasing dividends to shareholders by
30%.
Our main bank facilities at 31 March 2016 totalled $40m. These
facilities are committed until 30 November 2018.
Protection & Defence
Performance
Revenue for the division was GBP45.7m (2015: GBP45.3m) and
operating profit was GBP6.6m (2015: GBP6.4m). EBITDA was up 3% at
GBP9.6m (2015: GBP9.4m) and return on sales, as defined above, was
21.1% (2015: 20.6%). The increase arose from the mix of product
shipped, an improvement in DOD pricing and operational
efficiencies.
As we have always highlighted, while predicting the timing of
non-DOD orders and sales is difficult, our long-term DOD contract
and manufacturing excellence affords us the flexibility to fulfil
non-DOD orders as and when they arise and to meet the DOD's demand
in periods when non-DOD orders are lower.
Markets
M50 respirator sales to the DOD were 107,000 (2015: 112,000)
mask systems. During the period we received a further order for
167,000 mask systems which means we exit the half year with mask
order coverage well into 2017, providing good visibility of revenue
under this sole source long-term contract.
We delivered 36,000 M61 filter pairs during the period (2015:
nil) and have secured an order for a further 85,000 pairs which we
expect to deliver in the second half. In the long term, we believe
the end user demand for this consumable product will grow as
fielding of the mask continues but we continue to recognise that,
in the current DOD procurement environment, obtaining short-term
visibility of future filter spares orders remains challenging.
Sales to foreign military, law enforcement and first responder
customers increased year on year as the underlying portfolio
continues to grow. In addition, we have been encouraged by the
level of international enquiries for our respiratory protection
products and, although the timing of converting some of the larger
opportunities has not been in the first half of the year, we
believe that the conversion timeline for some of these
opportunities is shortening.
We saw growth in sales to the Fire market following the
acquisition of Argus and the launch of the new Mi-TIC Storm thermal
imaging camera which has now received NFPA and CE approval.
Other DOD spares sales were higher than the same period last
year, reflecting normal variability in the timing of orders and
delivery schedules.
AEF has experienced a softer first half, reflecting the
variability in timing of certain DOD procurement programmes for
hovercraft skirt and fuel and water storage tanks.
Order intake for the first half totalled GBP55m (2015: GBP47m).
Of the closing order book of GBP30m, GBP22m is for delivery in the
second half of our financial year, giving good visibility for the
remainder of the year.
Opportunities
Our funded development programme with the US Air Force to design
and test the MM53 Joint Service Aircrew Mask (JSAM) has progressed
well. This will provide respiratory protection to a wide range of
operators on the DOD's fleet of fixed-wing aircraft. The testing
phase of this development contract is expected to conclude at the
end of our 2016 financial year and should lead to a production
contract commencing in 2017 which could be worth in excess of
$70m.
A number of other military opportunities exist in relation to
both new and existing products that provide long-term growth
potential.
Dairy
Performance
Revenue for the Dairy business was 18% higher at GBP20.6m (2015:
GBP17.5m) following the acquisition of InterPuls which offset
softer market conditions caused by low milk prices. An increasing
proportion of higher margin Milkrite product and service sales
contributed to an increased operating profit of GBP3.4m (2015:
GBP3.3m). EBITDA grew 17% to GBP4.5m (2015: GBP3.9m) and return on
sales, as defined above, was flat at 22.0% (2015: 22.1%).
Markets
Market conditions for dairy farmers, particulary in Europe, have
been weak as milk prices have been low. This typically cyclical
market dynamic has, as expected, reduced demand for our consumable
products as farmers extend the life through over using our
products. The capital nature of the InterPuls products makes the
replacement cycle longer, meaning InterPuls is more affected by the
cyclical market dynamics than Milkrite consumable products.
Our existing dairy business has become substantially less
dependent on original equipment manufacturers (OEMs) in recent
years as we continue to grow sales of our own higher margin
Milkrite branded products and services. In difficult market
conditions we are encouraged that our Milkrite market share
continues to increase, meaning that we will exit this cyclical
downturn with a more robust business.
In Europe, where Avon-manufactured liners have a 61% market
share, Milkrite's market share has increased to 23% due to growth
in traditional Milkrite products and the success of our Impulse Air
mouthpiece vented liner, first launched in Europe late in 2013.
This product continues to gain traction, with its market share
increasing to 4.0% (31 March 2015: 3.0%, 30 September 2015:
3.5%).
In the US, where Avon-manufactured liners have a 63% market
share, the Milkrite Impulse Air mouthpiece vented liner continued
to perform well, with its market share increasing to 28% (31 March
2015: 22%, 30 September 2015: 25%).
The take up by farms of our innovative Cluster Exchange Service,
launched in 2014, remains at encouraging levels in both North
America and Europe. By the end of the period it was servicing
446,000 cows on 1,411 farms in the US and Europe, up from 342,000
cows and 1,100 farms at the same time last year. This added-value
service enhances the value of each direct liner sale we make and
should lead to a more robust and sustainable business model, with
the potential to grow a significant recurring revenue stream in the
years to come, as more farms continue to sign up.
We are pleased with the integration of InterPuls, acquired in
August 2015, into the wider Dairy business and are on track to
realise the long-term strategic benefits that have been identified,
in particular the sales synergies available in the North American
market.
Opportunities
Plans for the rollout of InterPuls products to the US are
underway, with dealers being trained, samples being issued through
our extensive distributor network and products launched at the
recent World Agricultural Expo in Tulare, California, positioning
the business to start delivering additional revenue in our 2017
financial year.
In emerging markets, including China, Brazil and India, the
number of dairy cows being milked using automated milking processes
is growing rapidly. This is adding to the market potential for the
products we sell. The sales and distribution operations we have
opened in China and Brazil are progressing to plan as we build our
dealer and distributor networks in these regions.
Taxation
The statutory tax credit totalled GBP0.4m (2015: charge of
GBP1.7m) on a statutory profit before tax of GBP6.1m (2015:
GBP8.4m). The effective tax rate for the period reflects the charge
arising from the anticipated geographic split of taxable profits
for 2016, offset by credits in relation to the positive outcome of
certain tax enquiries and the finalisation of the 2015 tax returns
in which we were able to take the benefit of certain deductions
allowed by legislation enacted after our 2015 financial statements
were approved.
Retirement Benefit Obligations
The IAS 19 valuation of the Group's UK retirement benefit
obligations has moved from a deficit of GBP16.6m at 30 September
2015 to a deficit of GBP18.7m at 31 March 2016. This arose from a
strong asset performance from our return-seeking assets, offset by
a fall in AA corporate bond rates, which increased liabilities.
During the period the Group made cash contributions in respect
of deficit recovery payments and administration costs of GBP325,000
(2015: GBP275,000).
The last actuarial triennial valuation undertaken as at 31 March
2013 showed the scheme to be 98.0% funded.
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Dividends
The final dividend for the 2015 financial year of 4.86p per
ordinary share was paid to shareholders on 18 March 2016 and
absorbed GBP1,473,000 of shareholders' funds.
For the current financial year the Board has declared an interim
dividend of 3.16p per ordinary share, an increase of 30% on the
2015 interim dividend. This will be paid on 5 September 2016 to
shareholders on the register on 8 August 2016. It is expected to
absorb GBP958,000 of shareholders' funds and there are no
corporation tax consequences.
Outlook
The Board remains confident that the Group will continue to make
progress as the year develops and maintain our record of strong
cash generation.
Trading is normally second-half weighted in our Protection &
Defence business and we believe this will again be the case this
year. We continue to see a number of higher margin export
opportunities and while, as always, the timing of order receipt
remains unpredictable, the DOD order we received late in the first
half affords us production flexibility to fulfil these as and when
they are received.
In Dairy, despite weak market conditions, the acquisition of
InterPuls and the encouraging gains in Milkrite market share
provide us with significant opportunity at the point milk prices
start to improve. This, together with the sales and distribution
platforms we have established in China and Brazil to service these
rapidly growing emerging markets, means we have a Dairy business
with excellent short and longer term growth prospects.
Rob Rennie Andrew Lewis
Chief Executive Group Finance Director
4 May 2016 4 May 2016
Statement of Directors' Responsibilities
The Directors confirm that this condensed consolidated interim
financial information has been prepared in accordance with
International Accounting Standard 34, 'Interim Financial Reporting'
as adopted by the European Union, and that the interim management
report herein includes a fair review of the information required by
DTR 4.2.7 and DTR 4.2.8, namely:
-- an indication of important events that have occurred during
the first six months and their impact on the condensed consolidated
interim financial information, and a description of the principal
risks and uncertainties for the remaining six months of the
financial year; and
-- material related party transactions in the first six months
and any material changes in the related party transactions
described in the last annual report.
The Directors are as listed on page 43 of the 2015 Annual
Report, except that Richard Wood retired from the Board on 26
January 2016, Rob Rennie was appointed on 1 December 2015 and Chloe
Ponsonby was appointed on 1 March 2016.
Forward--looking statements
Certain statements in this half year report are
forward--looking. Although the Group believes that the expectations
reflected in these forward--looking statements are reasonable, we
can give no assurance that these expectations will prove to have
been correct. Because these statements involve risks and
uncertainties, actual results may differ materially from those
expressed or implied by these forward--looking statements.
We undertake no obligation to update any forward--looking
statements whether as a result of new information, future events or
otherwise.
Company website
The interim statement is available on the Company's website at
www.avon--rubber.com. The maintenance and integrity of the website
is the responsibility of the Directors. Legislation in the United
Kingdom governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
Miles Ingrey-Counter
Company Secretary
4 May 2016
Consolidated Statement of Comprehensive Income
Half year to 31 March
Half year to 31 March 2016 2015 Year to 30 Sep 2015
Statutory Adjustments Adjusted Statutory Adjustments Adjusted Statutory Adjustments Adjusted
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Continuing
operations
Revenue 4 66,273 - 66,273 62,821 - 62,821 134,318 - 134,318
Cost of sales (41,882) - (41,882) (41,389) - (41,389) (88,618) (88,618)
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Gross profit 24,391 - 24,391 21,432 - 21,432 45,700 - 45,700
Selling and
distribution
costs (8,238) - (8,238) (6,984) - (6,984) (13,007) - (13,007)
General and
administrative
expenses 5 (9,512) 2,375 (7,137) (5,540) (363) (5,903) (13,807) 1,329 (12,478)
Operating
profit 4 6,641 2,375 9,016 8,908 (363) 8,545 18,886 1,329 20,215
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Operating
profit is
analysed as:
Before
depreciation
and
amortisation 12,491 718 13,209 12,662 (493) 12,169 26,981 286 27,267
Depreciation
and
amortisation (5,850) 1,657 (4,193) (3,754) 130 (3,624) (8,095) 1,043 (7,052)
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Operating
profit 6,641 2,375 9,016 8,908 (363) 8,545 18,886 1,329 20,215
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Finance income 6 8 - 8 9 - 9 45 - 45
Finance costs 6 (162) - (162) (51) - (51) (192) - (192)
Other finance
expense 6 (393) 318 (75) (453) 329 (124) (901) 654 (247)
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Profit before
taxation 6,094 2,693 8,787 8,413 (34) 8,379 17,838 1,983 19,821
Taxation 7 449 (550) (101) (1,683) - (1,683) (2,672) (253) (2,925)
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Profit for the
period
from
continuing
operations
Discontinued
operations 6,543 2,143 8,686 6,730 (34) 6,696 15,166 1,730 16,896
- loss for the
period 5 - - - - - - (1,500) 1,500 -
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Profit for the
period 6,543 2,143 8,686 6,730 (34) 6,696 13,666 3,230 16,896
---------------- ----- ---------- ------------ --------- -------------- ------------ ------------ ---------- ------------ ------------
Consolidated Statement of Comprehensive Income (continued)
Half year to 31 March Half year to 31 March
2016 2015 Year to 30 Sep 2015
Statutory Adjustments Adjusted Statutory Adjustments Adjusted Statutory Adjustments Adjusted
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
Other
comprehensive
income
Actuarial
(loss)/gain
recognised in
retirement
benefit scheme
(*) (1,824) - (1,824) 22 - 22 (1,040) - (1,040)
Deferred tax
relating
to retirement
benefit
scheme (*) 425 - 425 - - - 3,321 - 3,321
Net exchange
differences
offset in
reserves (**) 3,727 - 3,727 3,008 - 3,008 3,311 - 3,311
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
Other
comprehensive
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income
for the
period, net of
taxation 2,328 - 2,328 3,030 - 3,030 5,592 - 5,592
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
Total
comprehensive
income
for the period 8,871 2,143 11,014 9,760 (34) 9,726 19,258 3,230 22,488
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
Earnings per
share
Basic 9 21.6p 28.7p 22.4p 22.3p 45.4p 56.1p
Diluted 9 21.2p 28.1p 21.8p 21.7p 44.2p 54.6p
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
Earnings per
share from
continuing
operations
Basic 9 21.6p 28.7p 22.4p 22.3p 50.4p 56.1p
Diluted 9 21.2p 28.1p 21.8p 21.7p 49.0p 54.6p
---------------- ----- ---------- ------------ ------------------------- ------------ ------------ ---------- ------------ ------------ ---------
* Items that are not subsequently reclassified to the income
statement
**Items that may be subsequently reclassified to the income
statement
Consolidated Balance Sheet
As at As at As at
31 Mar 16 31 Mar 15 30 Sep
15
Note GBP'000 GBP'000 GBP'000
--------------------------------------- ----- ---------- ---------- ---------
Assets
Non-current assets
Intangible assets 45,476 19,011 41,309
Property, plant and equipment 29,094 20,249 28,212
Deferred tax assets 4,607 - 4,574
79,177 39,260 74,095
--------------------------------------- ----- ---------- ---------- ---------
Current assets
Inventories 20,813 16,722 17,123
Trade and other receivables 15,111 15,630 17,023
Derivative financial instruments - - 3
Cash and cash equivalents 13 823 7,273 332
--------------------------------------- -----
36,747 39,625 34,481
--------------------------------------- ----- ---------- ---------- ---------
Liabilities
Current liabilities
Borrowings 13 438 - 2,350
Trade and other payables 18,048 17,947 17,150
Derivative financial instruments 297 284 -
Provisions for liabilities and
charges 10 1,360 689 855
Current tax liabilities 8,732 7,711 6,823
--------------------------------------- -----
28,875 26,631 27,178
--------------------------------------- ----- ---------- ---------- ---------
Net current assets 7,872 12,994 7,303
--------------------------------------- ----- ---------- ---------- ---------
Non-current liabilities
Borrowings 13 8,801 - 11,143
Deferred tax liabilities 9,996 2,716 9,734
Retirement benefit obligations 18,732 15,568 16,605
Provisions for liabilities and
charges 10 1,631 1,241 1,712
--------------------------------------- -----
39,160 19,525 39,194
---------- ---------- ---------
Net assets 47,889 32,729 42,204
--------------------------------------- ----- ---------- ---------- ---------
Shareholders' equity
Ordinary shares 11 31,023 31,023 31,023
Share premium account 11 34,708 34,708 34,708
Capital redemption reserve 500 500 500
Translation reserve 6,106 2,076 2,379
Accumulated losses (24,448) (35,578) (26,406)
--------------------------------------- -----
Total equity 47,889 32,729 42,204
--------------------------------------- ----- ---------- ---------- ---------
Consolidated Cash Flow Statement
Half year Half year Year
to to to
31 Mar 16 31 Mar 15 30 Sep
15
Note GBP'000 GBP'000 GBP'000
--------------------------------------- ----- ---------- ---------- ---------
Cash flows from operating activities
--------------------------------------- ----- ---------- ---------- ---------
Cash generated from continuing
operating activities before the
impact of exceptional items 14,712 11,828 24,053
Cash impact of exceptional items (357) (694) (1,192)
--------------------------------------- ----- ---------- ---------- ---------
Cash generated from continuing
operations 12 14,355 11,134 22,861
Cash used in discontinued operations - - (1,529)
--------------------------------------- ----- ---------- ---------- ---------
Cash generated from operations 14,355 11,134 21,332
Finance income received 8 9 45
Finance costs paid (162) (51) (192)
Retirement benefit deficit recovery
contributions (325) (275) (800)
Tax received/(paid) 1,682 (1,232) (3,270)
Net cash generated from operating
activities 15,558 9,585 17,115
--------------------------------------- ----- ---------- ---------- ---------
Cash flows from investing activities
Proceeds from sale of property,
plant and equipment - - 21
Purchase of property, plant and
equipment (1,962) (1,411) (3,222)
Capitalised development costs
and purchased software (1,788) (1,733) (2,961)
Acquisition of subsidiaries and
businesses (3,500) (25) (21,249)
Net cash used in investing activities (7,250) (3,169) (27,411)
--------------------------------------- ----- ---------- ---------- ---------
Cash flows from financing activities
Net movements in loans (4,601) - 10,605
Dividends paid to shareholders (1,473) (1,127) (1,859)
Purchase of own shares (1,812) (1,152) (1,152)
Net cash (used in)/generated
from financing activities (7,886) (2,279) 7,594
--------------------------------------- ----- ---------- ---------- ---------
Net increase/(decrease) in cash,
cash equivalents and bank overdrafts 422 4,137 (2,702)
Cash, cash equivalents and bank
overdrafts at beginning of the
period 332 2,925 2,925
Cash, cash equivalents and bank
overdrafts acquired on acquisitions - - 12
Effects of exchange rate changes 69 211 97
--------------------------------------- ----- ---------- ---------- ---------
Cash, cash equivalents and bank
overdrafts at end of the period 13 823 7,273 332
--------------------------------------- ----- ---------- ---------- ---------
Consolidated Statement of Changes
in Equity
Share Share Other Accumulated
capital Premium reserves losses Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- -------- -------- --------- ------------ --------
At 30 September 2014 31,023 34,708 (432) (40,283) 25,016
Profit for the period - - - 6,730 6,730
Unrealised exchange differences
on overseas investments - - 3,008 - 3,008
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Actuarial gain recognised in
retirement benefit scheme - - - 22 22
------------------------------------- -------- -------- --------- ------------ --------
Total comprehensive income for
the period - - 3,008 6,752 9,760
Dividends paid - - - (1,127) (1,127)
Movement in shares held by the
employee benefit trust - - - (962) (962)
Movement in respect of employee
share schemes 42 42
------------------------------------- -------- -------- --------- ------------ --------
At 31 March 2015 31,023 34,708 2,576 (35,578) 32,729
Profit for the period - - - 6,936 6,936
Unrealised exchange differences
on overseas investments - - 303 - 303
Actuarial loss recognised in
retirement benefit scheme - - - (1,062) (1,062)
Deferred tax relating to retirement
benefit scheme - - - 3,321 3,321
------------------------------------- -------- -------- --------- ------------ --------
Total comprehensive income for
the period - - 303 9,195 9,498
Dividends paid - - - (732) (732)
Movement in shares held by the
employee benefit trust - - - (9) (9)
Movement in respect of employee
share schemes - - - 43 43
Deferred tax relating to employee
share schemes - - - 675 675
------------------------------------- -------- -------- --------- ------------ --------
At 30 September 2015 31,023 34,708 2,879 (26,406) 42,204
Profit for the period - - - 6,543 6,543
Unrealised exchange differences
on overseas investments - - 3,727 - 3,727
Actuarial loss recognised in
retirement benefit scheme - - - (1,824) (1,824)
Deferred tax relating to retirement
benefit scheme - - - 425 425
------------------------------------- -------- -------- --------- ------------ --------
Total comprehensive income for
the period - - 3,727 5,144 8,871
Dividends paid - - - (1,473) (1,473)
Movement in shares held by the
employee benefit trust - - - (1,698) (1,698)
Movement in respect of employee
share schemes - - - 42 42
Deferred tax relating to employee
share schemes - - - (57) (57)
------------------------------------- -------- -------- --------- ------------ --------
At 31 March 2016 31,023 34,708 6,606 (24,448) 47,889
------------------------------------- -------- -------- --------- ------------ --------
Notes to the Interim Financial Statements
1. General information
The company is a limited liability company incorporated in
England and domiciled in the UK. The address of its registered
office is Hampton Park West, Semington Road, Melksham, Wiltshire,
SN12 6NB. The company has its primary listing on the London Stock
Exchange.
This unaudited condensed consolidated interim financial
information was approved for issue on 4 May 2016.
These interim financial results do not comprise statutory
accounts within the meaning of Section 434 of the Companies Act
2006. Statutory accounts for the year ended 30 September 2015 were
approved by the Board of Directors on 17 November 2015 and
delivered to the Registrar of Companies. The report of the auditors
on those accounts was unqualified, did not contain an emphasis of
matter paragraph and did not contain any statement under Section
498 of the Companies Act 2006.
2. Basis of preparation
This condensed consolidated interim financial information for
the half year ended 31 March 2016 has been prepared in accordance
with the Disclosure and Transparency Rules of the Financial
Services Authority and with IAS 34, 'Interim financial reporting'
as adopted by the European Union. These interim financial results
should be read in conjunction with the annual financial statements
for the year ended 30 September 2015, which have been prepared in
accordance with IFRSs as adopted by the European Union.
Having considered the Group's funding position, budgets for 2016
and three year plan, the Directors have formed a judgment that
there is a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. For this reason the Directors continue to adopt the going
concern basis in preparing the condensed consolidated interim
financial information.
3. Accounting policies
The accounting policies adopted are consistent with those of the
annual financial statements for the year ended 30 September 2015,
as described in those financial statements.
Recent accounting developments
The following standards, amendments and interpretations have
been issued by the International Accounting Standards Board (IASB)
or by the International Financial Reporting Interpretations
Committee (IFRIC). The Group's approach to these is as follows:
a) Standards, amendments and interpretations effective in 2016:
No new standards or amendments have been adopted in preparing
the condensed consolidated half-yearly financial information or
will be required to be adopted for the year ending 30 September
2016.
b) Standards, amendments and interpretations to existing
standards issued but not yet effective in 2016 and not adopted
early:
- IFRS 9, 'Financial instruments'
- IFRS 14, 'Regulatory Deferral Accounts'
- IFRS 15, 'Revenue from Customer Contracts'
- IFRS 16, 'Leases'
- Amendments to IAS 1, 'Disclosure Initiative'
- Amendments to IAS 7, 'Disclosure Initiative'
- Amendment to IFRS 10 and IAS 28, 'Sale or Contribution of
Assets between and Investor and its Associate or Joint Venture'
- Amendments to IFRS 10, IFRS 12 and IAS 28, 'Applying the consolidation exemption'
- Amendments to IFRS 11, 'Accounting for Acquisition Interests in Joint Operations'
- Amendments to IAS 12, 'Recognition of Deferred Tax Assets for Unrealised Losses'
- Amendments to IAS 16 and IAS 38, 'Clarification of Acceptable
Methods of Depreciation and Amortisation'
- Amendments to IAS 16 and IAS 41, 'Agriculture - Bearer Plants'
- Amendments to IAS 27, 'Equity Method in Separate Financial Statements'
- Annual improvements cycle 2012-2014
4. Segment information
Operating segments are reported in a manner consistent with
the internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker, who is responsible for
allocating resources and assessing performance of the operating
segments, has been identified as the Group Executive team.
The Group has two clearly defined business segments, Protection
& Defence and Dairy, and operates out of Europe and the US.
Business segments
Half year to 31 March 2016
Protection
& Defence Dairy Unallocated Group
GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------------------------------- ---------------- -------- ------------ --------
Revenue 45,689 20,584 - 66,273
--------------------------------------------------------
Segment result before depreciation,
amortisation, exceptional
items and defined benefit
pension scheme costs 9,643 4,526 (960) 13,209
Depreciation of property,
plant and equipment (1,915) (897) (20) (2,832)
Amortisation of intangibles (1,168) (189) (4) (1,361)
-------------------------------------------------------- ---------------- -------- ------------ --------
Segment result before amortisation
of acquired intangibles,
exceptional items and defined
benefit pension scheme costs 6,560 3,440 (984) 9,016
Amortisation of acquired
intangibles (786) (871) - (1,657)
Exceptional items (508) - - (508)
Defined benefit pension scheme
costs - - (210) (210)
-------------------------------------------------------- ---------------- -------- ------------ --------
Segment result 5,266 2,569 (1,194) 6,641
Finance income 8 8
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Finance costs (162) (162)
Other finance expense (393) (393)
-------------------------------------------------------- ---------------- -------- ------------ --------
Profit before taxation 5,266 2,569 (1,741) 6,094
Taxation 449 449
--------------------------------------------------------
Profit for the period 5,266 2,569 (1,292) 6,543
-------------------------------------------------------- ---------------- -------- ------------ --------
Half year to 31 March 2015
Protection
& Defence Dairy Unallocated Group
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ----------- -------- ------------ --------
Revenue 45,333 17,488 - 62,821
------------------------------------- ----------- -------- ------------ --------
Segment result before depreciation,
amortisation and defined
benefit pension scheme credit 9,358 3,872 (1,061) 12,169
Depreciation of property,
plant and equipment (1,724) (533) (26) (2,283)
Amortisation of intangibles (1,275) (61) (5) (1,341)
------------------------------------- ----------- -------- ------------ --------
Segment result before amortisation
of acquired intangibles and
defined benefit pension scheme
credit 6,359 3,278 (1,092) 8,545
Amortisation of acquired
intangibles (130) - - (130)
Defined benefit pension scheme
credit - - 493 493
------------------------------------- ----------- -------- ------------ --------
Segment result 6,229 3,278 (599) 8,908
Finance costs (42) (42)
Other finance expense (453) (453)
------------------------------------- ----------- -------- ------------ --------
Profit before taxation 6,229 3,278 (1,094) 8,413
Taxation (1,683) (1,683)
------------------------------------- ----------- -------- ------------ --------
Profit for the period 6,229 3,278 (2,777) 6,730
------------------------------------- ----------- -------- ------------ --------
Year to 30 September 2015
Protection
& Defence Dairy Unallocated Group
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ----------- -------- ------------ --------
Revenue 98,843 35,475 - 134,318
------------------------------------- ----------- -------- ------------ --------
Segment result before depreciation,
amortisation, exceptional
items, acquisition costs
and defined benefit pension
scheme credit 21,632 7,707 (2,072) 27,267
Depreciation of property,
plant and equipment (3,513) (1,121) (50) (4,684)
Amortisation of intangibles (2,206) (153) (9) (2,368)
------------------------------------- ----------- -------- ------------ --------
Segment result before amortisation
of acquired intangibles,
exceptional items, acquisition
costs and defined benefit
pension scheme credit 15,913 6,433 (2,131) 20,215
Amortisation of acquired
intangibles (384) (659) - (1,043)
Exceptional items and acquisition
costs (209) (180) (215) (604)
Defined benefit pension scheme
credit - - 318 318
------------------------------------- ----------- -------- ------------ --------
Segment result 15,320 5,594 (2,028) 18,886
Finance income 45 45
Finance costs (192) (192)
Other finance expense (901) (901)
------------------------------------- ----------- -------- ------------ --------
Profit before taxation 15,320 5,594 (3,076) 17,838
Taxation (2,672) (2,672)
------------------------------------- ----------- -------- ------------ --------
Profit for the year from
continuing operations 15,320 5,594 (5,748) 15,166
Discontinued operations -
loss for the year (1,500) (1,500)
------------------------------------- ----------- -------- ------------ --------
Profit for the year 15,320 5,594 (7,248) 13,666
------------------------------------- ----------- -------- ------------ --------
Revenue by origin
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
---------------------------------------------------------------- ------------- ---------- ----------
Europe 16,553 11,819 23,704
US 49,720 51,002 110,614
66,273 62,821 134,318
---------------------------------------------------------------- ------------- ---------- ----------
Segment assets in Europe and the US were GBP58.0m and GBP57.9m respectively
(30 September 2015: GBP52.8m and GBP55.8m, 31 March 2015: GBP17.3m
and GBP61.6m).
5. Adjustments and discontinued operations
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
---------------------------------------------------------------- ------------- ---------- --------
Amortisation of acquired intangible
assets 1,657 130 1,043
Recruitment costs - - 215
Integration costs 508 - -
Acquisition costs - - 389
Defined benefit pension scheme administration
costs 210 175 350
Defined benefit pension scheme settlement
gain - (668) (668)
----------------------------------------------------------------- ------------- ---------- --------
2,375 (363) 1,329
---------------------------------------------------------------- ------------- ---------- --------
The tax impact of the above is a GBP0.1m reduction in tax
payable (31 March 2015: GBPnil, 30 September 2015: GBPnil). The
deferred tax impact gives rise to a credit to the income statement
of GBP0.45m (31 March 2015: GBPnil, 30 September 2015:
GBP0.25m).
The recruitment costs in 2015 relate to the recruitment of main
Board Directors.
The integration costs relate to the acquisition of the Argus
thermal imaging camera business and the relocation of the
manufacturing to our Melksham, UK site.
The acquisition costs in 2015 relate to legal and professional
fees on the acquisition of Hudstar Systems Inc. and InterPuls
S.p.A.
Defined benefit pension scheme costs relate to administrative
expenses of the scheme which is closed to future accrual and the
defined benefit pension scheme settlement gain arose following a
trivial commutation exercise, both of which impact operating
profit. GBP0.3m of other finance expense relating to the pension
scheme is also treated as an adjustment (31 March 2015: GBP0.3m, 30
September 2015: GBP0.7m).
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The 2015 loss for the year from discontinued operations related
to dilapidations costs of former leased premises of a business
which was disposed of in 2006.
6. Finance income and costs
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
------------------------------------------------------------------ ---- ---------- ---------- --------
Interest payable on bank loans and overdrafts (162) (51) (192)
Finance income 8 9 45
(154) (42) (147)
---- ---------- ---------- --------
Other finance expense
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
------------------------------------------------------------------ ---- ---------- ---------- --------
Net interest cost: UK defined benefit
pension scheme (318) (329) (654)
Provisions: Unwinding of discount (75) (124) (247)
(393) (453) (901)
---- ---------- ---------- --------
7. Taxation
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
------------------------------------------------------------------- --- ---------- ---------- --------
United Kingdom - - -
Overseas (449) 1,683 2,672
------------------------------------------------------------------- --- ---------- ---------- --------
(449) 1,683 2,672
Effect of exceptional items 550 - 253
------------------------------------------------------------------- --- ---------- ---------- --------
Adjusted tax charge 101 1,683 2,925
------------------------------------------------------------------- --- ---------- ---------- --------
The statutory effective tax rate for the period is a credit of 7%
(31 March 2015: charge of 20%, 30 September 2015: charge of 15%).
The adjusted effective tax rate, where the tax charge and the profit
before taxation are adjusted for exceptional items, the amortisation
of acquired intangibles and defined benefit pension scheme costs
is 1% (31 March 2015: 20%, 30 September 2015: 15%).
8. Dividends
On 29 January 2016, the shareholders approved a final dividend of
4.86p per qualifying ordinary share in respect of the year ended
30 September 2015. This was paid on 18 March 2016, absorbing GBP1,473,000
of shareholders' funds.
The Board of Directors has declared an interim dividend of 3.16p
(2015: 2.43p) per qualifying ordinary share in respect of the year
ended 30 September 2016. This will be paid on 5 September 2016 to
shareholders on the register at the close of business on 8 August
2016. In accordance with accounting standards, this dividend has
not been provided for and there are no corporation tax consequences.
It will be recognised in shareholders' funds in the year to 30 September
2016 and is expected to absorb GBP958,000 (2015: GBP732,000) of shareholders'
funds.
9. Earnings per share
Basic earnings per share is based on a profit attributable to ordinary
shareholders of GBP6,543,000 (2015: GBP6,730,000) and 30,248,000
(2015: 30,077,000) ordinary shares being the weighted average number
of shares in issue during the period.
Adjusted earnings per share is based on a profit attributable to
ordinary shareholders of GBP8,686,000 (2015: GBP6,696,000) after
adding back amortisation of acquired intangible assets, exceptional
items and defined benefit pension scheme costs.
The Company has 587,000 (1.9%) (2015: 824,000 (2.7%)) potentially
dilutive ordinary shares in respect of the Performance Share Plan.
10. Provisions for liabilities and charges
Property obligations
GBP'000
------------------------------ ---------------------
Balance at 30 September 2015 2,567
Receipts in the period 349
Unwinding of discount 75
------------------------------- ---------------------
Balance at 31 March 2016 2,991
------------------------------- ---------------------
Property obligations include an onerous lease provision and
obligations relating to former premises of the Group which are
subject to dilapidation risks. Property provisions are subject to
uncertainty in respect of the utilisation, non-utilisation, or
subletting of surplus leasehold property and the final negotiated
settlement of any dilapidation claims with landlords.
11. Share capital
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
------------------------------ ---------- ---------- -------
Number of shares (thousands) 31,023 31,023 31,023
Ordinary shares (GBP'000) 31,023 31,023 31,023
Share premium (GBP'000) 34,708 34,708 34,708
------------------------------- ---------- ---------- -------
During the period 175,000 ordinary shares with a nominal value
of GBP1 each were purchased by the Avon Rubber p.l.c. Employer
Share Ownership Trust at a cost of GBP1,812,000 and 10,082 ordinary
shares of GBP1 each were awarded in relation to the 2015 annual
incentive plan.
12. Cash generated from operations
Half year Half year Year
to to to
31 Mar 31 Mar 30 Sep
16 15 15
GBP'000 GBP'000 GBP'000
--------------------------------------------------------- -------- ----------- ---------- ----------
Continuing operations
Profit for the period 6,543 6,730 15,166
Adjustments for:
Taxation (449) 1,683 2,672
Depreciation 2,832 2,283 4,684
Amortisation of intangible assets 3,018 1,471 3,411
Defined benefit pension scheme costs/(credit) 210 (493) (318)
Net finance expense 154 42 147
Other finance expense 393 453 901
Loss on disposal of intangible assets
and property, plant and equipment - - 7
Movements in working capital and
provisions 1,612 (1,077) (3,894)
Other movements 42 42 85
--------------------------------------------------------- -------- ----------- ---------- ----------
Cash generated from continuing operations 14,355 11,134 22,861
------------------------------------------------------------------- ----------- ---------- ----------
Analysed as:
Cash generated from continuing operations
prior to the effect of exceptional
operating items 14,712 11,828 24,053
Cash effect of exceptional operating
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items (357) (694) (1,192)
------------------------------------------------------------------- ----------- ---------- ----------
Discontinued operations - loss for
the year - - (1,500)
Decrease in payables and provisions - - (29)
------------------------------------------------------------------- ----------- ---------- ----------
Cash used in discontinued operations - - (1,529)
------------------------------------------------------------------- ----------- ---------- ----------
Cash generated from operations 14,355 11,134 21,332
------------------------------------------------------------------- ----------- ---------- ----------
13. Analysis of net debt
As at Exchange As at
30 Sep Cash flow movements 31 Mar 16
15
GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------------- ------------------- ----------- ---------- ----------
Cash at bank and in hand 332 422 69 823
Debt due in less than 1 year (2,350) 2,052 (140) (438)
Debt due in more than 1 year (11,143) 2,549 (207) (8,801)
---------------------------------------------- ------------------- ----------- ---------- ----------
(13,161) 5,023 (278) (8,416)
---------------------------------------------- ------------------- ----------- ---------- ----------
Borrowing facilities As at As at As at
31 Mar 16 31 Mar 15 30 Sep 15
GBP'000 GBP'000 GBP'000
---------------------------------------------- ------------------- ----------- ---------- ----------
Total undrawn committed facilities 21,113 26,521 15,194
Bank loans and overdrafts
utilised 8,557 - 13,007
Utilised in respect of guarantees 280 370 362
Total Group facilities 29,950 26,891 28,563
---------------------------------------------- ------------------- ----------- ---------- ----------
All facilities are at floating interest rates.
On 9 June 2014 the Group agreed new bank facilities with Barclays
Bank and Comerica Bank. The combined facility comprises a revolving
credit facility of $40m and expires on 30 November 2018. This facility
is priced on the dollar LIBOR plus margin of 1.25% and includes
financial covenants which are measured on a quarterly basis. The
Group was in compliance with its financial covenants during 2016
and 2015.
InterPuls S.p.A has a fixed term loan of EUR2.5m which expires in
August 2020. This facility is priced on EURIBOR plus margin of 0.9%.
14. Exchange rates
The following significant exchange rates applied
during the period.
Average Closing Average Closing Average Closing
rate rate rate rate rate rate
H1 2016 H1 2016 H1 2015 H1 2015 FY 2015 FY 2015
------------------------ -------------------- --------- -------- ----------- ---------- ----------
US dollar 1.460 1.431 1.539 1.488 1.542 1.517
Euro 1.330 1.252 1.309 1.370 1.351 1.359
------------------------ -------------------- --------- -------- ----------- ---------- ----------
Fair value of financial instruments
The fair value of forward exchange contracts is determined by
using valuation techniques using period end spot rates, adjusted
for the forward points to the value date of the contract.
15. Acquisition
On 8 October 2015 the Group acquired the trade and assets of the
Argus thermal imaging business from e2v technologies plc for
consideration of GBP3.5m. Based in Chelmsford UK, Argus is a
leading designer and manufacturer of thermal imaging cameras for
the first responder and fire markets and further strengthens the
Group's product range and distribution capability in these
markets.
The book value of the assets acquired was GBP1.2m and after
accounting policy adjustments and provisional fair value
adjustments of GBP1.8m, goodwill of GBP0.5m was recognised
reflecting sales synergies from integration of distribution
channels, access to new markets and the workforce of the acquired
business.
Total
GBP'000
------------------------------------------------------ --------
Intangible assets recognised on acquisition 2,277
Deferred tax associated with the initial recognition
of intangible assets (455)
Other net assets 1,191
Goodwill 487
------------------------------------------------------- --------
Consideration 3,500
------------------------------------------------------- --------
16. Principal risks and uncertainties
The principal risks and uncertainties impacting the Group are
described on pages 28-31 of our Annual Report 2015 and remain
unchanged at 31 March 2016.
They include: market threat, product development, talent
management, business interruption - supply chain, acquisition
integration, quality risks and product recall, customer dependency
and non-compliance with legislation.
CORPORATE INFORMATION
REGISTERED OFFICE
Corporate Headquarters
Hampton Park West
Semington Road
Melksham
Wiltshire
SN12 6NB
Registered in England and Wales No. 32965
V.A.T. No. GB 137 575 643
BOARD OF DIRECTORS
David Evans (Chairman)
Pim Vervaat (Non-Executive Director)
Chloe Ponsonby (Non-Executive Director)
Rob Rennie (Chief Executive)
Andrew Lewis (Group Finance Director)
COMPANY SECRETARY
Miles Ingrey-Counter
INDEPENDENT AUDITORS
PricewaterhouseCoopers LLP
REGISTRARS & TRANSFER OFFICE
Capita Asset Services
The Registry
34 Beckenham Road
Beckenham
BR3 4TU
Tel: 0871 664 0300
(calls cost 10p per minute plus network extras,
lines are open 8.30am-5.30pm Mon-Fri)
BROKERS
Arden Partners plc
SOLICITORS
TLT LLP
PRINCIPAL BANKERS
Barclays Bank PLC
Comerica Inc.
CORPORATE FINANCIAL ADVISER
Arden Partners plc
CORPORATE WEBSITE
www.avon-rubber.com
Hampton Park West l Semington Road l Melksham l Wiltshire l SN12
6NB l England
Tel: +44 (0) 1225 896 800 l Fax: +44 (0) 1225 896 898 l e-mail: enquiries@avon-rubber.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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