TIDMTSTL
RNS Number : 6337M
Tristel PLC
17 October 2016
TRISTEL plc
("Tristel", "the Company" or "the Group")
Final Results
Audited Results for the year ended 30 June 2016
Tristel plc (AIM: TSTL), the manufacturer of infection
prevention and contamination control products, announces its
audited results for the year ended 30 June 2016 ahead of market
expectations.
Tristel's lead technology is a proprietary chlorine dioxide
formulation and the Company addresses three distinct markets:
-- The Human Healthcare market (hospital infection prevention - via the Tristel brand)
-- The Contamination Control market (control of contamination in
critical environments - via the Crystel brand)
-- The Animal Healthcare market (veterinary practice infection
prevention - via the Anistel brand)
Financial Highlights
-- Turnover up 12% to GBP17.1m (2015: GBP15.3m).
-- Overseas sales up 22% to GBP6.7m (2015: GBP5.5m),
representing 39% of total sales (2015: 36%).
-- EBITDA before share based payments up 26% to GBP4.3m (2015:
GBP3.4m). Unadjusted GBP3.7 (2015: GBP3.4m)
-- Pre-tax profit before share based payments up 27% to GBP3.3m
(2015: GBP2.6m). Unadjusted GBP2.6m (2015: GBP2.6m)
-- Basic EPS before share based payments of 6.62p, up 20% (2015:
5.53 pence). Unadjusted 5.01p (2015: 5.44p
-- Dividend per share for the full year increased by 11% to
6.33p (2015: 5.72p), including a special dividend of 3p per share
(2015 special dividend: 3p per share).
-- Net cash of GBP5.7m at year end (2015: GBP4.0m). Company remains debt free.
Operational Highlights
-- All overseas operations are profitable.
-- 25 overseas regulatory body approvals, in 7 countries, achieved in the year.
-- Acquisition of the business and assets of Australian distributor. Post balance sheet event.
-- Business plan to enter North American infection prevention market progressing well.
Paul Swinney, Chief Executive of Tristel plc, said:
"We made very solid progress during the year. International
expansion continues to drive revenue growth and we are succeeding
in increasing profit margins, even whilst investing in new products
and opening up new geographical markets, including North America.
The progress we are making with the United States FDA and EPA, and
Canada's HPB, is in line with the North American business plan we
are developing."
The annual report and financial statements will be available on
the Company's website www.tristel.com later today.
For further information:
Tristel plc Tel: 01638 721 500
Paul Swinney, Chief Executive
Liz Dixon, Finance Director
Walbrook PR Ltd Tel: 020 7933 8780 or tristel@walbrookpr.com
Paul McManus Mob: 07980 541 893
Lianne Cawthorne Mob: 07584 391 303
FinnCap
Geoff Nash / Giles Rolls (Corporate Tel: 020 7600 1658
Finance)
Chairman's Statement
We made very solid progress during the year to 30 June 2016,
delivering sales of GBP17.1m (2015: GBP15.3m) which were ahead of
market expectations. Whilst the pace of overall top-line growth
slowed slightly to 12% from 14% achieved in 2015, overseas sales
once again made excellent progress, increasing by 22% in the year.
This increase would have been 25% in constant currency terms.
Overseas sales represented 39% of total sales in 2016. As the
contribution of overseas sales to total sales continues to
increase, we can anticipate global sales growth to remain in the
range of 10% to 15% over the medium term. There is still
significant growth to come from existing markets as well as the new
markets we are preparing to enter.
The operational gearing which exists within the business drove
adjusted pre-tax profit up by 27% to GBP3.3m (2015: GBP2.6m). Basic
earnings per share (EPS), was 5.01 pence, down 8% from the previous
year (2015: 5.44 pence). During the year there was an unusually
large share-based payment charge of GBP0.67m (2015: GBP0.04m) which
will not repeat in future years. In this Strategic Report pre-tax
profit is adjusted for this share based payment charge. Adjusted
Basic EPS is 6.62 pence, up 20% from the previous year's comparable
figure (2015: 5.53 pence).
Shortly after the year end we announced a special dividend of 3
pence for the second consecutive year. This was paid in August
2016. In line with the Company's dividend policy, the Board is
recommending that the final dividend is 2.19 pence (2015: 2.14
pence), an increase of 3%. Including the interim dividend of 1.14
pence (2015: 0.585 pence), the special dividend of 3 pence (2015: 3
pence), and the proposed final dividend, the total dividend for the
year will be 6.33 pence (2015: 5.72 pence), an increase of 11%. If
approved, the final dividend will be paid on 16 December 2016 to
shareholders on the register at 18 November 2016. The corresponding
ex-dividend date is 17 November 2016. For the past two years the
Company has generated cash that is surplus to its operational and
investment requirements.
We have continued to invest in the business during the year,
spending GBP0.17m on product development and testing and GBP0.12m
on patenting in order to protect our intellectual property, both of
which are held in intangible assets. GBP0.34m was invested in
regulatory approval programmes in 22 countries, recognised as an
expense in the year. Included in our expenditure on regulatory
approvals is an amount of GBP0.13m, also recognised as an expense
in the year, which relates to our initiative to enter the United
States market which commenced in 2014. The initiative is
progressing satisfactorily and in accordance with our project
plan.
During the year David Orr joined our Board as a non-executive
director and has made an excellent contribution in his first
year.
The strength of Tristel is built upon the hard work and
expertise of all the people who work for the Company. I would like
to thank them all for their contribution throughout the year.
Our core strategic objective is to achieve consistent and
sustainable growth in total shareholder returns (TSR). We consider
TSR to be the combination of growth in EPS and the yield from
ordinary and special dividends. We have established our second
strategic three-year plan, taking us to 30 June 2019, in which we
have set a target of growing revenue within a range of 10% to 15%
as an annual average over the three-year period, and maintaining a
minimum pre-tax profit margin of 17.5%. If we achieve these two key
objectives, we will have created the conditions for consistent and
sustainable EPS and dividend growth.
The current year promises a number of exciting developments for
Tristel. We will pursue them with a disciplined focus, adhering to
our core strategy, which is:
1. To deliver long term sustainable growth in shareholder
returns;
2. to distribute surplus cash to our shareholders;
3. to invest in gaining regulatory approvals to enable us to
enter new geographical markets, and
4. to invest in the design and development of new products, and
the improvement of existing ones.
We have long stated that it is our ambition to make Tristel a
recognisable force in the world of infection prevention. I have no
doubt that we have achieved this. My Board colleagues and I believe
we can look forward to Tristel's future with continued
confidence.
Francisco Soler
Chairman
14 October 2016
Chief Executive's report
Current year - Overview
Group revenue was up 12%, adjusted pre-tax profit was up 27%,
and adjusted EPS was up 20%. We ended the year with cash of
GBP5.7m, of which GBP1.3m was distributed as a special dividend in
August 2016. The Company is debt-free.
In our 2014 financial year, when revenue was GBP13.5m, we set a
revenue target of GBP20m to be achieved in the 2017 financial year
- an increase of almost 50% in sales over a three-year period. We
are now in the final year of that financial plan.
Whilst setting very explicit and precise goals may be helpful
for stakeholders, it can also be a double-edged sword when
performance veers slightly off track in any given short term
period. We experienced this at the time of our interim results in
February 2016 when the share price reacted strongly to a relatively
subdued performance in top-line growth during the first half.
We have listened to our shareholders and other observers of the
Company and are now setting out our plans for the next three years.
We believe that we can grow sales in the range of 10% to 15% per
annum as an annual average over the next three years ending 30 June
2019. This is laid down in our strategic plan as a key performance
indicator (KPI) of the Company. In our 2014 plan we also set an
objective of achieving a pre-tax profit margin of at least 15% even
whilst investing in the United States regulatory project which we
were about to commence. The pre-tax profit margin in 2014 was 14%,
in 2015 17%, and in 2016 19% (adjusted for share based payments).
The profitability of our business is increasing due to operational
gearing. The plan which will take us to 2019 is going to involve
increasing expenditures in regulatory approvals in the United
States and other key markets and we have decided that it will be
prudent to set a minimum 17.5% pre-tax profit margin as our target.
This becomes our second KPI.
We are proposing a final dividend of 2.19 pence per share,
making 3.33 pence in total for the year, up 22%. After the year end
we also paid a further 3 pence as a special dividend.
Post year end - Acquisition
Shortly after the year end we acquired the business and a number
of assets of the distributor that has served the Australian
healthcare market with Tristel's Wipe System since 2011. The
acquisition was made for a total consideration of GBP1.1m and was
completed on 15 August 2016. We expect the acquisition to increase
both the sales and gross margins achieved from our Australian
business, in addition to being earnings enhancing.
Our business
What our marketplace looks like
Our entire business is focussed on preventing the transmission
of microbes from one object or person to another. We pursue this
purpose because some microbes can be a source of infection to
humans and animals. They can cause illness and death, and place a
heavy cost on individuals and society. We achieve our purpose by
applying a very powerful disinfectant - chlorine dioxide - to the
target surface or medical instrument.
We are one of a very few companies worldwide that can
legitimately claim to be exclusively an infection prevention
business. We are unique worldwide in being a business that uses
chlorine dioxide as a high-performance disinfectant for medical
instruments.
Our mission is most relevant to hospitals, especially acute
hospitals, where the risks of infection to individuals are highest.
In the human healthcare market, we brand our products Tristel. The
risk of cross infection is also relevant to veterinary practices,
or animal hospitals, and in the animal healthcare market we brand
our products Anistel. Finally, the control of microbial
contamination is very relevant in critical manufacturing
environments, for example cleanrooms, and in this market our
products are branded Crystel.
An acute hospital is a vast, multi-faceted organisation. We are
not only unique in providing chlorine dioxide as a high-performance
disinfectant within hospitals, but we are also unique in our focus
upon specific clinical departments within them. We target clinical
departments that carry out diagnostic procedures with small
heat-sensitive medical instruments. These would include: the
nasendoscope used in Ear, Nose and Throat departments; the
laryngoscope blade used in emergency medicine; tonometers used in
ophthalmology, and ultrasound probes used in women's health. In
these departments, we are the only simple to implement, affordable,
high-performance disinfection method available. As a consequence,
in geographical markets in which we have been present for some
time, we hold truly dominant market positions. Our objective is to
be "a very big fish, even if in only a small pond" in all the
clinical areas we target.
How We Service Our Market
Over 95% of our revenues are of repeat consumable products that
perform a vital function in hospitals. Their use is for the most
part non-discretionary. Our products are typically small packaged
goods, requiring no after sales service, other than repeat
training. Capital sales, service and maintenance revenues do not
feature, therefore, in a significant way in our revenue model.
We sell our products directly to end-users in those markets in
which we have established a direct operational presence, and
through distributors in markets where we have no presence.
Our revenues - by sales channel
Year on Percentage
GBP000's 2015-16 2014-15 year change change
------------------- ----------------------- ----- ------------- -------------- ------------- -----------
Human Healthcare Direct sales UK 8,547 8,232 315 4%
------------------- ----------------------- ----- ------------- -------------- ------------- -----------
EU 1,927 1,390 537 39%
------------------------------------------------- ------------- -------------- ------------- -----------
ROW 2,025 1,638 387 24%
------------------------------------------------- ------------- -------------- ------------- -----------
Sales to distributors EU 1,102 1,214 (112) (9%)
----------------------- ------------------------- ------------- -------------- ------------- -----------
ROW 998 615 383 62%
------------------------------------------------- ------------- -------------- ------------- -----------
Contamination
Control Direct sales UK 1,140 987 153 16%
------------------- ----------------------- ----- ------------- -------------- ------------- -----------
Sales to distributors EU 332 387 (55) (14%)
----------------------- ------------------------- ------------- -------------- ------------- -----------
ROW 18 0 18 100%
------------------------------------------------- ------------- -------------- ------------- -----------
Animal Healthcare Direct sales UK 222 78 144 185%
------------------- ----------------------- ----- ------------- -------------- ------------- -----------
EU 4 4 0 0%
------------------------------------------------- ------------- -------------- ------------- -----------
ROW 156 140 16 11%
------------------------------------------------- ------------- -------------- ------------- -----------
Sales to distributors UK 457 536 (79) (15%)
----------------------- ------------------------- ------------- -------------- ------------- -----------
EU 176 113 63 56%
------------------------------------------------- ------------- -------------- ------------- -----------
Group sales 17,104 15,334 1,770 12%
------------------------------ ------------------ ------------- -------------- ------------- -----------
Our revenues - by technology
The majority of our sales are of chlorine dioxide based
products; but we do formulate, manufacture and sell products
utilising other disinfectant chemistries. These include quaternary
ammonium compounds, peracetic acid and alcohol. In 2016, GBP3.7m of
our sales were of non-chlorine dioxide chemistries, representing
22% of the total. As our chlorine dioxide product sales increase at
a faster pace than non-chlorine dioxide product sales, and as we
continue to find ways to persuade customers to switch to chlorine
dioxide as a superior disinfection technology, we expect this
percentage to decline.
Year on Percentage
GBP000's 2015-16 2014-15 year change change
------------------- ----------------------- ------- -------------- -------------- ------------- -----------
Human Healthcare Direct sales ClO2 11,847 10,710 1,137 11%
------------------- ----------------------- ------- -------------- -------------- ------------- -----------
Other 652 550 102 19%
--------------------------------------------------- -------------- -------------- ------------- -----------
Sales to distributors ClO2 1,432 1,188 244 21%
----------------------- --------------------------- -------------- -------------- ------------- -----------
Other 668 641 27 4%
--------------------------------------------------- -------------- -------------- ------------- -----------
Contamination
Control Direct sales ClO2 38 27 11 41%
------------------- ----------------------- ------- -------------- -------------- ------------- -----------
Other 1,102 960 142 15%
--------------------------------------------------- -------------- -------------- ------------- -----------
Sales to distributors ClO2 43 78 (35) (45%)
----------------------- --------------------------- -------------- -------------- ------------- -----------
Other 307 309 (2) 1%
--------------------------------------------------- -------------- -------------- ------------- -----------
Animal Healthcare Direct sales ClO2 7 1 6 600%
------------------- ----------------------- ------- -------------- -------------- ------------- -----------
Other 375 221 154 70%
--------------------------------------------------- -------------- -------------- ------------- -----------
Sales to distributors ClO2 3 3 0 0%
----------------------- --------------------------- -------------- -------------- ------------- -----------
Other 630 646 (16) 2%
--------------------------------------------------- -------------- -------------- ------------- -----------
Group sales 17,104 15,334 1,770 12%
-------------------------------- ------------------ -------------- -------------- ------------- -----------
Our revenues - by portfolio and geographical split
Revenue increased by 12% in the year. UK sales grew by 5% and
overseas sales grew by 22%. Overseas sales are made via two
channels: through the Company's wholly owned subsidiaries and
branches in Germany, Hong Kong, China, New Zealand and Russia; and
via third party distributors. Overseas subsidiary and branch sales
increased by 30% to GBP4.1m in the year and overseas sales via
distributors grew by 13% to GBP2.6m. The post year-end acquisition
of our Australian distributor will result in a higher ratio of
subsidiary sales to distributor sales in 2017.
Our Strategic Assets
We consider the assets that enable the Company to achieve its
strategic goals to be:
-- ur chlorine dioxide chemistry, about which there are three critically important elements:
1. The formulation is proprietary;
2. We remain the only company using chlorine dioxide for the
decontamination of medical instruments in the world, which gives us
a genuine point of difference from all other infection prevention
companies;
3. The length of time that we have enjoyed this position has
allowed us to collate a significant body of knowledge, including
published scientific data, the testimony of almost two decades of
safe use, a significant global footprint of regulatory approvals
and a library of proven compatibility with hundreds of medical
instruments, all of which would take a newcomer a significant
period of time and cost to match.
-- Intellectual property protection - as at 30 June 2016, we
held 156 patents granted in 34 countries providing legal protection
for our products;
-- Our people - who hold an unrivalled body of knowledge
relating both to infection prevention and to chlorine dioxide.
These strategic assets drive our success and differentiate us
from our competitors.
Our proprietary chlorine dioxide chemistry
During the year we launched, or continued the early stage
roll-out, of the following products all based on our chlorine
dioxide chemistry:
-- Tristel Rinse Assure, which is a system for dosing low levels
of our chlorine dioxide chemistry into the water used during an
endoscopy washer disinfector's decontamination process, ensuring
that the rinse water is of the highest quality;
-- Tristel Protect, which is a short-term storage and
transportation system for clean and contaminated semi-critical
medical devices;
-- Tristel Pop Wipes, which are wipes that high-level disinfect
hard contact surfaces and are also effective against bacterial
spores. Tristel Pop Wipes can be packaged for clean room use;
-- Tristel Tank, which is a mixing station and distribution
point for Tristel's high-level disinfectant for surfaces in human
and animal healthcare environments.
In addition to the above, the Company has an exciting product
development pipeline.
Our regulatory programme succeeded in attaining approvals for 25
products in seven countries during the year.
Our intellectual property protection
We have 156 patents granted in 34 countries. The progress that
the Company has made during the course of the past three years in
building its patent portfolio is demonstrated below:
Year to 30 ClO2 hand Trigger ClO2 decontamination ClO2 wipes Total Granted
June ClO2 foam disinfectant spray technology device system Cases
2014 10 22 1 21 25 79
2015 11 35 2 23 26 97
2016 12 37 52 29 26 156
Our people
At 30 June 2016 our senior management team, excluding the 2
executive directors, numbered ten individuals, with an average age
of forty years and an average length of service of over seven
years. Sixty percent of the team are female and the team is drawn
from six nationalities. Our technical people perform microbiology,
chemistry, regulatory and quality roles, with their key skills
centred upon infection prevention and our proprietary chlorine
dioxide chemistry. All staff participate in the Company's personal
development programme which is designed to stimulate creative
thinking and develop good management skills. Additionally, the
Company encourages and financially supports the advancement of
employees' knowledge through study and further qualification. A
diverse, well-educated and international workforce is a hallmark of
the Company.
Delivering on our key strategic financial goal
Our key strategic financial goal is to deliver long term
sustainable growth in total shareholder returns (TSR). We focus on
TSR as a measure and not simply growth in EPS because to do so
would not take account of the value created by paying out surplus
cash to shareholders. This goal will be achieved by:
1 Consistently growing revenue - during the past four years,
revenue has grown from GBP10.6m to GBP17.1m - an increase of 62%.
The compound annual growth rate in revenue since the Company went
public in 2005 has been 17%. We believe that we can grow sales in
the range of 10% to 15% per annum as an annual average over the
three years ending 30 June 2019.
2 Maintaining the profitability of the Company - we believe that
we can operate above a minimum pre-tax margin of 17.5%
3 Distributing cash that is not required for the operational and
investment needs of the business to shareholders in the form of
dividends.
We define TSR as growth in EPS added to the total dividend
yield. Taking dividends as a percentage of our average share price
during the financial year, our TSR is set out in the table
below:
Total Shareholder Returns 2016 2015
------------------------------- ------ ------
Growth in adjusted EPS during
year 19.7% 68.6%
------------------------------- ------ ------
Special Dividend Yield 2.6% 3.8%
------------------------------- ------ ------
Ordinary Dividend Yield 2.8% 3.4%
------------------------------- ------ ------
Total Shareholder Returns 25.1% 75.8%
------------------------------- ------ ------
The inclusion of growth in EPS (adjusted for share based
payments) in TSR is grounded in the belief that, over time, share
price growth will follow growth in EPS. The table below shows how
our share price has tracked EPS over the past three years.
2014 2015 2016
------------------------ ----- ----- -----
Adjusted EPS (pence) 3.28 5.53 6.62
------------------------ ----- ----- -----
Average share price in
year (GBP) 0.43 0.8 1.17
------------------------ ----- ----- -----
One year ago we reported that we had embarked upon a United
States regulatory approvals programme.
We are currently pursuing a United States FDA approval for two
high-level disinfectant products which are both classified as
medical devices and require a 510(K) submission. We label the
products as Duo for Ophthalmology and Duo for Ultrasound. Both
products are liquid chlorine dioxide formulations dispensed in a
foam format by specialised packaging.
In our interims statement in February we reported that a
pre-submission dossier had been presented to the FDA seeking their
guidance on our approach to data generation for the 510(K)
submission, and requesting a meeting in Washington. The meeting
took place in late April 2016. By mid-June the guidance notes were
agreed and we anticipate submitting various scientific protocols
for review and comment by the FDA by end October 2016. Whilst it
may take until early 2017 for all these protocols to be finalised,
we are proceeding to generate much of the data that we anticipate
will be required.
As we have explained since we first revealed that we were
planning to enter the North American market, our plans are not
restricted to FDA regulated medical device products, but will also
include United States EPA regulated surface and water disinfection
products. In September we made a pre-submission meeting request to
the EPA and we will meet the EPA in Washington in the Autumn of
2016. We have presented a pre-submission dossier to the EPA for the
products which we label as Fuse for Surfaces, Duo for Surfaces, Jet
Gel and Jet Liquid for Surfaces; and Rinse Assure and Filter Shot
for endoscope washer-disinfector rinse water management.
We are taking a similar approach for all the products referred
to above with Canada's regulatory authority, the Health Protection
Board.
In summary, we have developed a broadly-based business strategy
for the North American market, which is built around the regulatory
processes in the United States and Canada. We are confident that
our plan is proceeding very satisfactorily, and that we are on
track to generate revenues in North America during the financial
year commencing July 2018.
Through on-the-ground research, discussion with prospective
commercial partners, analysis of the very few competitor peer
companies that are in the ophthalmology and ultrasound markets in
North America, collaboration with the professional bodies that
preside over the clinical areas we are targeting, and from our
experiences in markets such as the United Kingdom, France, Germany
and Australia where we are successfully penetrating these markets,
we have developed an assessment of the potential value of the North
American ophthalmology and ultrasound markets.
This assessment has been arrived using the same methodology that
we have employed in all the geographical markets where we have
entered the ophthalmic and ultrasound imaging sector: the driver
for the consumption of our products is the number of clinical
procedures that are undertaken in hospital departments where
ophthalmic and ultrasound medical devices are used. The devices
must be re-usable (not disposable after single-use), be heat
sensitive, and require high-level disinfection. They are likely to
be used in clinical settings in which the principal alternative
disinfection method to Tristel - automated disinfection requiring
investment in capital equipment and maintenance - is not easy to
implement, economically justifiable, or affordable by healthcare
systems which globally are under extreme financial stress.
Our estimate of the potential value of the North American
ophthalmology market is approximately GBP8m and the North American
ultrasound market approximately GBP10m. We have made no assessment
of how much of this potential market we can penetrate, or of the
timeframe. We have not yet attempted to value the potential market
opportunity in surface disinfection and rinse water management.
Focus
The Company has a dual focus: on infection prevention and on our
proprietary chlorine dioxide chemistry. The achievements that we
have made have come from sticking to what we know and do well and
we believe there remains an enormous opportunity to continue this
success.
We have set objectives which are visible to everyone inside the
Company, and we make them equally visible to all other
stakeholders. The measures against which our progress will be
judged are simple and clear, and I believe that the Company is
capable of delivering upon them - and our ambition will always be
to over achieve them. We will do this by being focussed and
disciplined. We have a mantra within the Company "The most
important thing is to keep the most important thing the most
important thing"
The most important thing for Tristel is to deliver sustainable
growth to its shareholders.
Paul Swinney
Chief Executive Officer
14 October 2016
Tristel plc
Consolidated Income Statement
For the year ended 30 June 2016
---------------------------------
Note Year ended Year ended
30 June 30 June
2016 2015
GBP'000 GBP'000
Revenue 3 17,104 15,334
Cost of sales 3 (4,549) (4,673)
----------- -----------
Gross profit 12,555 10,661
Administrative expenses:
Share-based payments 3 (674) (35)
Depreciation, amortisation and
impairments 3 (1,071) (844)
Other 3 (8,242) (7,241)
------------------------------------------ ----- ----------- -----------
Total administrative expenses (9,987) (8,120)
Operating profit 2,568 2,541
Finance income 12 12
Finance costs - (9)
Results from equity accounted
associate 13 8
Profit before tax 2,593 2,552
Taxation 4 (491) (337)
----------- -----------
Profit after tax 2,102 2,215
=========== ===========
Attributable to:
Equity holders of parent 2,102 2,215
2,102 2,215
=========== ===========
Earnings per share from total
and continuing operations attributable
to equity holders of the parent
Basic - pence 6 5.01 5.44
Diluted - pence 6 4.81 5.23
=========== ===========
All amounts relate to continuing operations.
Tristel plc
Consolidated Statement of Comprehensive Income
For the year ended 30 June 2016
------------------------------------------------
Year ended Year ended
30 June 30 June
2016 2015
GBP'000 GBP'000
Profit for the period 2,102 2,215
Items that will be reclassified subsequently
to profit and loss
Exchange differences on translation
of foreign operations 146 (57)
-----------
Other comprehensive income for the
period 146 (57)
Total comprehensive income for the
period 2,248 2,158
===========
Attributable to:
Equity holders of the parent 2,248 2,158
2,248 2,158
=========== ===========
Tristel plc
Consolidated Statement of Changes in Equity
For the year ended 30 June 2016
---------------------------------------------
Share Share Merger Foreign Retained Total Non- controlling Total
earnings attributable interests equity
to owners
of the
parent
Capital premium reserve exchange
account reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
30 June 2014 402 9,284 478 (93) 2,167 12,238 (162) 12,076
Transactions with owners
Dividends paid - - - - (752) (752) - (752)
Shares Issued 12 636 - - - 648 - 648
Adjustment for
change of
controlling
interest - - - 3 (172) (169) 169 -
Share-based
payments
- IFRS 2 - - - - 35 35 - 35
Total transactions
with owners 12 636 - 3 (889) (238) 169 (69)
Profit for the
year ended 30
June 2015 - - - - 2,215 2,215 - 2,215
Other
comprehensive
income: -
Exchange
differences on
translation of
foreign
operations - - - (57) - (57) - (57)
-------- -------- -------- --------- ---------- -------------- ----------------- --------
Total comprehensive
income - - - (57) 2,215 2,158 - 2,158
-------- -------- -------- --------- ---------- -------------- ----------------- --------
30 June 2015 414 9,920 478 (147) 3,493 14,158 7 14,165
-------- -------- -------- --------- ---------- -------------- ----------------- --------
Transactions with owners
Dividends paid - - - - (2,621) (2,621) - (2,621)
Shares Issued 7 491 - - - 498 - 498
Share-based
payments
- IFRS 2 - - - - 674 674 - 674
Total transactions
with owners 7 491 - - (1,947) (1,449) - (1,449)
Profit for the
year ended 30
June 2016 - - - - 2,102 2,102 - 2,102
Other comprehensive
income:- Exchange
differences on
translation of
foreign operations - - - 146 - 146 - 146
Total comprehensive
income - - - 146 2,102 2,248 - 2,248
-------- -------- -------- --------- ---------- -------------- ----------------- --------
30 June 2016 421 10,411 478 (1) 3,648 14,957 7 14,964
======== ======== ======== ========= ========== ============== ================= ========
Tristel plc
Consolidated Balance Sheet
As at 30 June 2016
----------------------------
2016 2015
Note GBP'000 GBP'000
Non-current assets
Goodwill 667 667
Intangible assets 5,380 5,631
Property, plant and equipment 1,416 1,347
7,463 7,645
-------- --------
Current assets
Inventories 1,875 2,061
Trade and other receivables 3,735 3,194
Cash and cash equivalents 5,715 4,045
-------- --------
11,325 9,300
-------- --------
Total assets 18,788 16,945
======== ========
Capital and reserves
Share capital 7 421 414
Share premium account 10,411 9,920
Merger reserve 478 478
Foreign exchange reserve (1) (147)
Retained earnings 3,648 3,493
-------- --------
Equity attributable to owners
of the parent 14,957 14,158
-------- --------
Non-controlling interests 7 7
-------- --------
Total equity 14,964 14,165
-------- --------
Current liabilities
Trade and other payables 3,256 2,434
Current tax 432 247
-------- --------
3,688 2,681
-------- --------
Non-current liabilities
Deferred tax 136 99
Total liabilities 3,824 2,780
-------- --------
Total equity and liabilities 18,788 16,945
======== ========
The financial statements were approved and authorised for issue
by the Board of Directors on 14 October 2016, and were signed on
its behalf by:
Elizabeth Dixon
Director
Tristel plc
Consolidated Cash Flow Statement
For the year ended 30 June 2016
----------------------------------
2016 2015
Note GBP'000 GBP'000
Cash flows from operating
activities
Cash generated from operating
activities i 4,819 2,936
Corporation tax paid (269) (324)
-------- --------
4,550 2,612
-------- --------
Cash flows used in investing
activities
Interest received 12 12
Purchase of intangible assets (406) (567)
Purchases of property, plant
and equipment (499) (496)
Proceeds from sale of property,
plant and equipment 16 18
Net cash used in investing
activities (877) (1,033)
-------- --------
Cash flows from financing
activities
Loans repaid - (52)
Interest paid - (9)
Share issues 498 648
Dividends paid (2,621) (752)
-------- --------
Net cash used in financing
activities (2,123) (165)
-------- --------
Net increase in cash and cash
equivalents 1,550 1,414
Cash and cash equivalents
at the beginning of the period ii 4,045 2,664
Exchange differences on cash
and cash equivalents 120 (33)
-------- --------
Cash and cash equivalents
at the end of the period ii 5,715 4,045
======== ========
Tristel plc
Notes to the Consolidated Cash Flow Statement
For the year ended 30 June 2016
-----------------------------------------------
i. RECONCILIATION OF PROFIT BEFORE TAX TO CASH GENERATED FROM
OPERATIONS
2016 2015
GBP'000 GBP'000
Profit before tax 2,593 2,552
Depreciation of plant, property
& equipment 442 397
Amortisation of intangible
assets 524 447
Impairment of intangible asset 125 -
Results from associates - (8)
Share-based payments - IFRS2 674 35
Profit- on disposal of property, plant
and equipment (2) (3)
Loss on disposal of intangible
asset 8 125
Finance costs - 9
Finance income (12) (12)
4,352 3,542
Decrease/(increase) in inventories 186 2
Increase in trade and other
receivables (541) (504)
Increase/(decrease) in trade
and other payables 822 (104)
Cash generated from operations 4,819 2,936
========= =========
ii. CASH AND CASH EQUIVALENTS
The amounts disclosed on the cash flow statement in respect of
cash and cash equivalents are in respect of these balance sheet
amounts.
30 June 2016 30 June 2015
Year ended 30 June 2016 GBP'000 GBP'000
Cash and cash equivalents 5,715 4,045
5,715 4,045
============= =============
30 June 2015 30 June 2014
Year ended 30 June 2015 GBP'000 GBP'000
Cash and cash equivalents 4,045 2,664
4,045 2,664
============= =============
1. ACCOUNTING POLICIES
Basis of accounting
These financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
the European Union (EU).
There have been no new financial reporting standards effective
for the year which have impacted the accounting policies stated
below. Tristel plc, the Group's ultimate parent company, is a
limited liability company incorporated and domiciled in the United
Kingdom.
Basis of consolidation
The Group financial statements consolidate those of the Company
and all of its subsidiary undertakings drawn up to 30 June 2016.
Subsidiaries are entities over which the Group has rights or is
exposed to variable returns from its involvement with the investee
and has the power to affect those returns by controlling the
financial and operating policies so as to obtain benefits from its
activities. The Group obtains and exercises control through voting
rights.
Unrealised gains on transactions between the Group and its
subsidiaries are eliminated. Unrealised losses are also eliminated
unless the transaction provides evidence of an impairment of the
asset transferred. Amounts reported in the financial statements of
subsidiaries have been adjusted where necessary to ensure
consistency with the accounting policies adopted by the Group.
Acquisitions of subsidiaries are dealt with by the acquisition
method. The acquisition method involves the recognition at fair
value of all identifiable assets and liabilities, including
contingent liabilities of the subsidiary, at the acquisition date,
regardless of whether or not they were recorded in the financial
statements of the subsidiary prior to acquisition. These fair
values are also used as the basis for subsequent measurement in
accordance with the Group accounting policies. Goodwill is stated
after separating out identifiable intangible assets. Goodwill
represents the excess of the aggregate of the consideration
transferred and the amount of non-controlling interest over the
fair value of the Group's share of the identifiable net assets of
the acquired subsidiary at the date of acquisition.
Non-controlling interests, presented as part of equity,
represent a proportion of a subsidiary's profit or loss and net
assets that is not held by the Group. The Group attributes total
comprehensive income or loss of subsidiaries between the assets of
the parent and the non-controlling interests based on their
respective ownership interests.
There was a change in the prior year in the controlling interest
related to the Group's ownership of Tristel Asia and Tristel
Medical Equipment Co Ltd, the step acquisition makes both entities
wholly owned. There was an immaterial amount of consideration
arising upon acquisition. The difference between the
non-controlling interest and the fair value of the consideration
paid was recognised directly in equity attributable to the
parent.
EU adopted IFRSs not yet applied
As of 30 June 2016, the following Standards and Interpretations
are in issue but not yet effective and have not been adopted early
by the Group:
-- IFRS 9 Financial Instruments (IASB effective date 1 January 2018)
-- IFRS 15 Revenue from Contracts with Customers (effective 1 January 2017)
-- Clarification of Acceptable Methods of Depreciation and
Amortisation - Amendments to IAS 16 and IAS 38 (IASB effective date
1 January 2016)
-- Annual Improvements to IFRSs 2012-2014 Cycle (effective 1 January 2016)
-- IFRS 16 Leases (effective 1 January 2019)
-- Amendments to IAS 12: Recognition of Deferred Tax Assets for
Unrealised Losses (effective 1 January 2017)
-- Amendments to IFRS 2: Classification and Measurement of
Share-based Payment Transactions (effective 1 January 2018)
-- Amendments to IAS 7: Disclosure Initiative (effective 1 January 2017)
The Directors anticipate that the adoption of these standards
and interpretations in future periods will have no material effect
on the financial statements of the Group, except for IFRS 16. The
impact of IFRS 16 has not yet been assessed.
2. PUBLICATION NON-STATUTORY ACCOUNTS
The financial information set out in this Audited Preliminary
Announcement does not constitute the Group's statutory accounts for
the years ended 30 June 2016 or 2015, as defined in Section 435 of
the Companies Act 2006, but is derived from those accounts.
Statutory accounts for the year ended 30 June 2015 have been
delivered to the Registrar of Companies, and those for 2016 will be
delivered in due course. The auditors Grant Thornton UK LLP have
reported on those accounts; their reports were (1) unqualified,
(ii) did not include a reference to any matters to which the
auditors 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.
The Board of Tristel plc approved the release of this audited
Preliminary Announcement on 14 October 2016.
3. SEGMENTAL ANLAYSIS
Management considers the Group's revenue lines to be split into
three operating segments, which span the different Group entities.
The operating segments consider the nature of the product sold, the
nature of production, the class of customer and the method of
distribution. The Group's operating segments are identified from
the information which is reported to the chief operating decision
maker.
The first segment concerns the manufacture, development and sale
of infection control and hygiene products which includes products
that incorporate the Company's chlorine dioxide chemistry, and are
used primarily for infection control in hospitals ("Human
Healthcare"). This segment generated approximately 85% (2015: 85%)
of Group revenues.
The second segment, which constitutes 6% (2015: 5.6%) of the
business activity, relates to manufacture and sale of disinfection
and cleaning products, into veterinary and animal welfare sectors
("Animal healthcare").
The third segment addresses the pharmaceutical and personal care
product manufacturing industries ("Contamination control") and has
generated 9% (2015: 9.4%) of the Group's revenues this year.
The operation is monitored and measured on the basis of the key
performance indicators of each segment, these being revenue and
gross profit, and strategic decisions are made on the basis of
revenue and gross profit generating from each segment.
Human Animal Contamination Group Human Animal Contamination Group
Healthcare Healthcare Control 2016 Healthcare healthcare Control 2015
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
from
external
customers 14,599 1,015 1,490 17,104 13,089 871 1,374 15,334
--------------
Segment
revenues 14,599 1,015 1,490 17,104 13,089 871 1,374 15,334
Cost
of
material 3,574 333 642 4,549 3,663 314 696 4,673
Gross
Profit 11,025 682 848 12,555 9,426 557 678 10,661
=========== =========== ============== ======== =========== =========== ============== ========
Gross
Profit
% 76% 67% 57% 73% 72% 64% 49% 70%
Centrally incurred income and expenses not attributable
to individual segments:
Other operating - -
income:
Depreciation, amortisation
and impairment of non-financial
assets (1,071) (844)
Other administrative
expenses (8,242) (7,241)
Share based payments (674) (35)
-------- --------
Operating profit 2,568 2,541
======== ========
Operating profit can be reconciled to Group profit before tax as follows:
Operating profit 2,568 2,541
Finance income 12 12
Results from equity accounted
associate 13 8
Finance costs - (9)
Group profit before
tax 2,593 2,552
======== ========
The Group's revenues from external customers are divided into
the following geographical areas: -
Human Animal Contamination Group Human Animal Contamination Group
Healthcare Healthcare Control 2016 Healthcare healthcare Control 2015
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
United
Kingdom 8,547 679 1,140 10,366 8,232 614 987 9,833
Germany 1,778 - - 1,778 1,390 - - 1,390
Rest
of the
World 4,274 336 350 4,960 3,467 257 387 4,111
----------- ----------- -------------- --------- ----------- ----------- -------------- ---------
Group
revenues 14,599 1,015 1,490 17,104 13,089 871 1,374 15,334
=========== =========== ============== ========= =========== =========== ============== =========
4. TAXATION
The taxation charge represents:
2016 2015
GBP'000 GBP'000
Current taxation-
Corporation tax 444 363
Adjustment in respect of earlier years 10 (10)
Double taxation relief - (113)
Foreign taxation - 119
-------- --------
Total current tax 454 359
-------- --------
Deferred tax-
Origination and reversal of temporary
differences 14 (22)
Over/(under) provided in respect of 23 -
prior periods
Total deferred tax 37 (22)
-------- --------
Total tax charge in Income Statement 491 337
======== ========
Factors affecting the tax charge:
The tax assessed for the year differs from the standard rate of
corporation tax in the UK. The difference is explained below:
2016 2015
GBP'000 GBP'000
Profit on ordinary activities before
tax 2,593 2,552
======== ========
Profit on ordinary activities
multiplied by the standard rate of corporation
tax
in the UK of 20% (2015: 20.75%) 519 530
Effects of:
Expenses not deductible for tax purposes 31 52
Tax rate differences (11) 11
Enhanced relief on qualifying scientific
research expenditure (136) (82)
Foreign tax credits - 6
Adjustment in respect of prior years 33 -
Tax losses not utilised and other temporary
differences 55 (180)
-------- --------
Total tax charge for year 491 337
======== ========
5. DIVIDENDS
2016 2015
Amounts recognised as distributions to equity GBP'000 GBP'000
holders in the year:
Ordinary shares of 1p each
Final dividend for the year ended 30 June
2015 of 2.14p
(2014: 1.26p) per share 899 513
Interim dividend for the year ended 30 June
2016 of 1.14p
(2015: 0.585p) per share 480 239
Special dividend of 3p per share paid on 1,242 -
the 8 August 2015
2,621 752
======== ========
Special dividend of 3p per share paid on
the 8 August 2016 (2015: 3 August 2015) 1,265 1,242
======== ========
Proposed final dividend for the year ended
30 June 2016
of 2.19p (2015: 2.14p) per share 923 899
======== ========
The proposed final dividend is subject to approval by
shareholders at the forthcoming Annual General Meeting and has not
been included as a liability in the financial statements.
6. EARNINGS PER SHARE
The calculations of earnings per share are based on the
following profits and numbers of shares:
2016 2015
GBP'000 GBP'000
Retained profit for the financial year attributable
to equity holders of the parent 2,102 2,215
======== ========
Shares Shares
'000 '000
Number Number
Weighted average number of ordinary shares
for the purpose of basic earnings per share 41,945 40,705
Share options 1,747 1,614
-------- --------
43,692 42,319
======== ========
Earnings per ordinary share
Basic 5.01p 5.44p
Diluted 4.81p 5.23p
======== ========
A total of 70,000 options of ordinary shares were anti-dilutive
at 30 June 2016. All remaining share options are dilutive at 30
June 2016 and were dilutive at 30 June 2015.
7. CALLED UP SHARE CAPITAL
Allotted, issued and fully paid ordinary Number: GBP'000
shares of 1 pence each
30 June 2015 41,392,201 414
Issued during the year 773,000 7
----------- --------
30 June 2016 42,165,201 421
=========== ========
8. ANNUAL REPORT
The annual report and financial statements will be available on
the company's website www.tristel.com from 17 October 2016. Printed
copies will be posted to shareholders prior to the Company's Annual
General Meeting taking place on 13 December 2016 in Snailwell,
Newmarket.
9. POST BALANCE SHEET EVENT
On 15 August 2016 the Group acquired from the Australian company
Ashmed PTY Ltd, its customer base, stock, fixed assets and staff,
for a total consideration of GBP1.1m in cash. The customer base and
staff were purchased for a consideration of GBP959k, the amount
will be recognised within intangible assets. Stock was acquired for
GBP119k, to be shown within inventory. Transaction costs have been
incurred, including an amount of GBP50k recognised in these
financial statements within administration expenses. An estimate of
the financial effect of the transaction can be found within the
Chief Executive's report, on page 5 of these financial
statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR LLFEFIFLELIR
(END) Dow Jones Newswires
October 17, 2016 02:00 ET (06:00 GMT)
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