Interim Results
May 16 2003 - 3:00AM
UK Regulatory
RNS Number:1736L
Eurocopy PLC
16 May 2003
Eurocopy PLC
Interim Results for the Six
Months Ending 31 March 2003
Continued Improvement in Half Year's Results
* Operating profit #1.31 million (2002: #1.29 million).
* Profit before taxation #1.28 million (2002: #1.25
million).
* Earnings per share of 2.04 pence (2002: 1.87 pence).
* Interim dividend of 0.55 pence per share (2002: 0.51
pence).
* Print volumes up to 83.5 million per month (2002: 81.5
million).
Cyril Gay, Chairman, commented:
"The underlying strength of our business has enabled us to deliver another set
of solid results despite more difficult trading conditions. The significant
degree of stability that our contracted revenue base provides enables us to look
ahead confident that our targets in the short term can be achieved."
For further information, please contact:
Cyril Gay, Chairman
Eurocopy PLC 01924 823455
Martin McCarney, Chief Executive
Eurocopy PLC 01924 823455
Matthew Burton, Group Financial Director
Eurocopy PLC 01924 823455
Chairman's Statement
Results
Our Business has achieved another solid set of results for the six months to 31
March 2003, despite more difficult trading conditions than we have seen in
recent years. Profit before tax at #1.28 million (2002: #1.25 million) was in
line with expectations. Earnings per share at 2.04 pence were up by 9% from 1.87
pence in the same period last year, supported by the earnings enhancing effect
of our share buy back programme.
Dividend
In line with our policy of maintaining a dividend cover of approximately 2.5
times, and to pay approximately one third of the dividend at the interim stage,
your Board has decided to declare an interim dividend of 0.55 pence per share
(2002: 0.51 pence per share).
Trading
Trading activity in the period to 31 March 2003 saw mixed fortunes.
The service division, from which the majority of the Group's profit is derived,
performed in line with expectations. Print volumes produced on customers'
equipment, and invoiced to customers on a charge per print basis increased to an
average of 83.5 million per month for the half year (2002: 81.5 million). This
was reflected in a modest increase in service turnover to #6.2 million for the
half year (2002: #6.0 million) and in operating profit from the service division
to #1.16 million for the half year (2002: #1.13 million).
The success of our service division continues to reflect the quality of service
we offer to our customers and the technical expertise we provide to help
customers to maximise the use of the digital equipment we have supplied. The
secure contracted service revenues we generate from our customer base give our
business a high degree of stability which is of great value in uncertain times.
Our machine sales division has fared less well in the half year. Turnover from
the sales division fell to #3.8 million for the half year (2002: #4.4 million),
much of the shortfall coming in the second quarter. We believe that growing
uncertainty in the economy has caused the deferral of purchasing decisions in a
number of customer situations, thereby elongating the renewal cycle within the
customer base. Tight control of direct costs has nevertheless enabled the
machine sales division to continue to meet its target of breaking even after
absorption of costs. In the short term the delay of renewals within the customer
base has no adverse impact on service revenues, but over time certain accounts
might become more vulnerable to competitor activity. It also delays the
opportunity to achieve organic growth in print volumes through the placement of
digital equipment into integrated IT network linked environments, where we would
expect to capture additional print volumes.
Current expectations are that the deferral of some machine renewals will be a
temporary consequence of recent uncertainties and that the lost ground will be
picked up in the second half of the year.
Leasing opportunities have continued to be developed, and at the half year the
lease book stood at #4.2 million (31 March 2002 #3.6 million). Consequently
operating profit from leasing increased to #0.22 million (2002: #0.19 million),
and we continue to achieve an excellent return on the cash invested in the lease
book.
Acquisitions
A small infill acquisition of a customer base in West London was made in the
half year with the purchase of Cannonade Limited for a consideration of #116,000
net of cash acquired with the business. This business has yet to make a
contribution to profit because of acquisition and reorganisation costs expensed.
Purchase of the Company's own shares
In the six months to 31 March 2003 we have acquired and cancelled a further
205,000 ordinary shares at a cost excluding commission and expenses of 40 pence
per share. At the Extraordinary General Meeting held on 5 March 2003,
shareholders granted authority to purchase a maximum of a further 10% of the
issued share capital.
Outlook
The underlying strength of our business has enabled us to deliver another set of
solid results despite more difficult trading conditions. The significant degree
of stability that our contracted revenue base provides enables us to look ahead
confident that our targets in the short term can be achieved.
We continue to be committed to growing our business both through bolt-on
acquisitions and by exploiting the opportunities provided by digital technology
to grow print volumes organically. Our business continues to be a strong cash
generator and together with the strength of our balance sheet provides us with
ample financial resources to continue to pursue all aspects of our growth
strategy. Consequently your Board remains optimistic for the prospects for the
business.
CYRIL GAY
Chairman
16 May 2003
Independent Review Report to Eurocopy PLC
Introduction
We have been instructed by the Company to review the financial information for
the six months ended 31 March 2003 which comprises the group profit and loss
account, the summarised group balance sheet, the summarised group cashflow
statement and the related notes numbered 1 to 5. We have read the other
information contained in the interim report and considered whether it contains
any apparent misstatements or material inconsistencies with the financial
information.
This report is made solely to the Company in accordance with Bulletin 1999/4
issued by the Auditing Practices Board. Our work has been undertaken so that we
might state to the Company those matters we are required to state to them in an
independent review report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than
the Company, for our review work, for this report, or for the conclusions we
have formed.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures are consistent with
those applied in preparing the preceding annual accounts except where any
changes, and the reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the accounting policies and presentation
have been consistently applied unless otherwise disclosed. A review excludes
audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with United Kingdom auditing standards and therefore
provides a lower level of assurance than an audit. Accordingly, we do not
express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 31 March 2003.
Deloitte & Touche
Chartered Accountants
Leeds
16 May 2003
Eurocopy PLC
Group Profit and Loss Account
For the Half Year Ended 31 March 2003
Half Year Half Year Year
ended ended ended
31 March 31 March 30 September
2003 2002 2002
Unaudited Unaudited Audited
#'000 #'000 #'000
Turnover from Continuing Operations 11,617 12,113 24,307
Turnover from Acquisitions 36 - -
----------- ------------ ------------
Total Turnover 11,653 12,113 24,307
======== ======== ========
Operating Profit from Continuing
Operations 1,320 1,287 2,570
Operating Loss from Acquisitions (10) - -
----------- ----------- -----------
Total Operating Profit 1,310 1,287 2,570
Net Interest Payable (29) (34) (51)
---------- ---------- ---------
Profit on Ordinary 1,281 1,253 2,519
Activities Before Tax
Tax on Profit on Ordinary Activities (417) (407) (822)
--------- --------- ---------
Profit for the Financial Period 864 846 1,697
Dividends (232) (223) (672)
--------- --------- ---------
Amount Transferred to Reserves 632 623 1,025
========== ========== =========
Net Dividends Per Share 0.55p 0.51p 1.58p
Earnings Per Share - Basic 2.04p 1.87p 3.80p
- Diluted 2.01p 1.85p 3.75p
There are no recognised gains or losses in the half-year ended 31 March 2003
other than the profit for the period.
Eurocopy PLC
Summarised Group Balance Sheet
At 31 March 2003
31 March 31 March 30 September
2003 2002 2002
Unaudited Unaudited Audited
#'000 #'000 #'000
Tangible Assets 3,145 3,457 3,305
Intangible Assets 5,612 5,814 5,641
-------- -------- -------
Fixed Assets 8,757 9,271 8,946
========= ======== ========
Stock and Debtors 9,354 9,057 8,947
Properties in Course 558 558 558
of Disposal
Cash at Bank and in Hand 481 464 306
-------- --------- ---------
Current Assets 10,393 10,079 9,811
======== ======== =======
Bank Overdraft (771) (382) (1,136)
Other Creditors (6,358) (6,634) (6,082)
--------- --------- ---------
Current Liabilities (7,129) (7,016) (7,218)
========= ========= =========
Provisions (364) (443) (415)
========= ========= =========
NET ASSETS 11,657 11,891 11,124
======== ======== ========
Share Capital 2,113 2,247 2,123
Share Premium and Capital 437 303 427
Redemption Reserve
Profit and Loss Account 9,107 9,341 8,574
--------- --------- ---------
SHAREHOLDERS' FUNDS 11,657 11,891 11,124
(ALL EQUITY) ======== ======== ========
Eurocopy PLC
Summarised Cash Flow Statement
For the Half Year Ended 31 March 2003
Half Year Half Year Year
ended ended ended
31 March 31 March 30 September
2003 2002 2002
Unaudited Unaudited Audited
#'000 #'000 #'000
Net cash inflow from 1,402 1,120 2,873
--------- -------- ---------
Operating Activities
---
Net Cash outflow (29) (34) (51)
from Returns on Investment ---------- ----------- -----------
and Servicing of Finance
Taxation (529) (348) (1,006)
--------- ------------ ----------
Capital Expenditure
Purchase of Fixed Assets (162) (216) (474)
Sale of Fixed Assets 72 63 146
---------- ----------- -----------
Net cash outflow from (90) (153) (328)
Capital Expenditure --------- --------- ----------
Acquisitions (net of cash (115) - -
acquired) -------- ------------ ------------
Equity Dividends paid - - (646)
----------- ------------ ----------
Net cash inflow 639 585 842
before financing --------- ---------- -----------
Financing (99) (279) (1,448)
Purchase of Own Shares ---------- --------- ----------
Increase/(decrease) in cash 540 306 (606)
========= ======= ===========
Notes
1. The abridged results, summarised Group cash flow for the year ended
30 September 2002 and summarised Group balance sheet at that date are extracted
from the accounts filed with the Registrar of Companies and received an
unqualified report from the Auditors.
2. Earnings per share are calculated on 42,339,629 ordinary shares
being the weighted average number in issue during the six months to 31 March
2003 (six months to 31 March 2002: 45,238,503 Ordinary Shares).
Diluted earnings per share for the six months to 31 March 2003 are calculated
on 43,016,412 ordinary shares (six months to 31 March 2002: 45,797,128) being
the adjusted weighted average number in issue after the deemed issue of 676,783
ordinary shares for no consideration under share option schemes (2002: 558,625
ordinary shares).
3. A dividend of 0.55p per ordinary share will be paid on 5 September
2003 to shareholders on the register at the close of business on 8 August 2003.
4. The financial information contained herein does not constitute
statutory accounts within the meaning of Section 240 of the Companies Act 1985,
but has been prepared on the basis of accounting policies used in the financial
statements for the year ended 30 September 2002.
5. Interim results will be posted to shareholders and will be available
to members of the public at the Company's registered office: Eurocopy PLC,
Northern House, Moor Knoll Lane, East Ardsley, Wakefield WF3 2EE.
For further information please contact:
Cyril Gay, Chairman
Eurocopy PLC 01924 823455
Martin McCarney, Chief Executive
Eurocopy PLC 01924 823455
Matthew Burton, Group Financial Director
Eurocopy PLC 01924 823455
This information is provided by RNS
The company news service from the London Stock Exchange
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