TIDMBMS
RNS Number : 5234Z
Braemar Shipping Services PLC
20 May 2019
BRAEMAR SHIPPING SERVICES PLC
("Braemar", the "Company" or the "Group")
20 May 2019
Preliminary Results for the year ended 28 February 2019
Strong Strategic and Financial Progress Achieved
Braemar Shipping Services plc (LSE: BMS), a leading
international provider of broking, financial, consultancy,
technical and logistics services to the shipping, marine, energy,
offshore and insurance industries, today announces preliminary
results for the year ended 28 February 2019.
Financial Highlights
-- Good progress achieved with revenue from continuing
operations increased by 14% to GBP117.9m (2018: GBP103.0m)
-- 25% increase in underlying operating profit to GBP9.1m (2018: GBP7.3m)
-- Underlying basic EPS growth of 19% to 23.32p (2018: 19.57p)
-- Final dividend of 10.0p giving an unchanged full year
dividend of 15.0p, covered 1.6 times (2018 15.0p covered 1.3
times)
-- Discontinued operations showing a loss of GBP22.7m mainly
attributable to GBP21.3m book loss on disposal of Technical
Division business units.
-- Net debt of GBP7.8m up from GBP2.4m, including the cash in discontinued operations
Business Highlights
-- Shipbroking traded ahead of expectations and in particular
had a strong second half, notably in Dry Cargo and Tankers, forward
order book maintained at $43m.
-- Encouraging first full year trading of Financial Division
with a broadening client base and growing pipeline of business. We
believe that our expectations at the time of acquisition will be
met.
-- Post year end disposal of loss-making Technical Division
business units in return for a significant equity investment in a
larger and stronger business.
-- Steady trading from Logistics with an increase in margins and underlying profit.
-- Newly simplified Group structure focused on core activities
to deliver higher margin services to the maritime industry.
-- Significant Board changes to help drive long-term sustainable shareholder value.
SUMMARY FINANCIAL RESULTS
Underlying Results Reported Results
2018/19 2017/18 2018/19 2017/18
---------- ---------- ----------- ----------
Revenue GBP117.9m GBP103.0m GBP117.9m GBP103.0m
Operating Profit / (loss) GBP9.1m GBP7.3m (GBP2.7)m GBP(1.7)m
Profit/(Loss) for the GBP7.2m GBP5.8m (GBP27.4)m (GBP2.9)m
year 23.32p 19.57p (88.63p) (9.70p)
Basic Earnings / (loss)
per Share
Full Year Dividend per
Share 15.0p 15.0p 15.0p 15.0p
---------- ---------- ----------- ----------
Specific Items
2018/19 2017/18
------------ -----------
Acquisition and disposal related GBP(11.1)m GBP(9.1)m
expenditure GBP(0.8)m
One off costs relating to Board
changes
Specific item operating loss GBP(11.8)m GBP(9.1)m
Gain on revaluation of investment GBP0.5m
Finance costs associated with GBP(0.8)m GBP(0.2)m
acquisitions GBP(12.0)m GBP(9.3)m
Total Specific items before
tax
------------ -----------
Discontinued Operations
2018/19 2017/18
------------ -----------
Loss from discontinued operations GBP22.7m GBP0m
Ronald Series, Chairman of Braemar, commenting on the results
and the outlook said:
"Braemar achieved good progress during 2018 but there is still
much more to do and further opportunities to develop as we return
the Group to growth.
It is an exciting time for Braemar, having reached a good
solution for the majority of the Technical division. The Group is
now well set to focus on our Shipbroking, Financial and Logistics
businesses which have good prospects.
"I look forward to working with the Board and senior team and
reporting on further progress during 2019."
Listing Rule 9.6 disclosure
Braemar also announces that Steve Kunzer, one of its
non-executive Directors, is also an independent director of
Dampskibsselskabet NORDEN A/S, a ship owning company listed on
Nasdaq Copenhagen.
This announcement contains inside information as defined under
the Market Abuse Regulation (EU) No. 596/2014
-Ends-
For further information, contact:
Braemar Shipping Services
James Kidwell, Chief Executive Tel +44 (0) 20 3142 4100
Nick Stone, Group Finance Director Tel +44 (0) 20 3142 4100
Stockdale Securities
Robert Finlay / Antonio Bossi / Henry Tel +44 (0) 20 7601 6100
Willcocks
Buchanan
Charles Ryland / Victoria Hayns / Tel +44 (0) 20 7466 5000
Stephanie Watson / Tilly Abraham
Alternative Profit Measures ("APMs")
Braemar uses APMs as key financial indicators to assess the
underlying performance of the Group. Management considers the APMs
used by the Group to better reflect business performance and
provide useful information to investors and other interested
parties. Our APMs include underlying operating profit and
underlying earnings per share. Explanations of these terms and
their calculation are shown in the summary above and in detail in
our Financial Review.
About Braemar Shipping Services plc
Braemar Shipping Services plc is a leading international
provider of knowledge and skill-based services to the shipping,
marine, energy, offshore and insurance industries. Founded in 1972,
Braemar employs approximately 750 people in more than 60 locations
(although this will fall by around 250 people and 30 locations
following the disposal of the Technical business units) worldwide
across its Shipbroking, Financial, Logistics and Technical
divisions.
Braemar joined the Official List of the London Stock Exchange in
November 1997 and trades under the symbol BMS.
For more information, including our investor presentations,
visit www.braemar.com
PRELIMINARY ANNOUNCEMENT - YEARED 28 FEBRUARY 2019
CHAIRMAN'S STATEMENT
Braemar's underlying performance from continuing operations in
2018/19 achieved a noticeable improvement over the previous year.
2018/19 was the first full year of trading for Braemar-NAVES and
Braemar Atlantic which were both acquired in the previous year.
Through these acquisitions, we have established a new presence in
the maritime financial advisory market and in dry freight and
commodity derivatives markets both of which are complementary to
shipbroking and widen Braemar's offering to its customers.
On 13 May 2019 we announced the disposal of the loss-making
Offshore, Marine and Adjusting businesses of our Technical division
to Aqualis ASA, a Norwegian listed group, operating in offshore and
renewables consulting in exchange for a 26% stake of the enlarged
Group's equity. In addition, we will receive performance based
warrants which offer the potential to increase our stake to 33% in
two years' time. This transaction, which is in line with our
strategy to focus on the Group's core, profitable operations, is
expected to complete in mid-June 2019, at which point Braemar will
become the largest shareholder in Aqualis. The Board strongly
believes that this is an excellent result for both Braemar and
Aqualis and the best solution for the Technical division.
Aqualis operates primarily in the Offshore and Renewables
sectors and has a particular strength in the Middle East. The
combination of our businesses with Aqualis provides an excellent
fit with little geographic or client overlap. The enlarged group
will be a market leader with global coverage of marine, adjusting,
offshore and renewables services. We are also delighted that the
group will trade as AqualisBraemar which maintains our name in
technical services and enables us to continue to cross sell and
package these services. The Aqualis management team has a strong
track record of managing and growing businesses in these sectors
through the cycle.
The business units sold made an operating loss of GBP1.7 million
in the year. The estimated valuation of the consideration received
by way of shares and warrants is GBP6.4 million and the total loss
recorded on the disposal after fees is GBP21.3 million.
The Group has decided to retain its Engineering business because
its services to the LNG industry have a close connection to and
joint business with the Shipbroking division.
RESULTS FOR THE YEAR
Revenue from continuing operations for the year was 14.4% higher
at GBP117.9 million compared with GBP103.0 million in 2017/18.
Underlying operating profit from continuing operations was
considerably higher at GBP9.1 million compared with GBP7.3 million
in 2017/18 and underlying earnings per share were 23.32 pence
compared with 19.57 pence last year. All these figures are reported
excluding the Technical Division business units that form part of
the Aqualis transaction which is treated as a discontinued
operation for this purpose.
The Shipbroking division performed well, particularly in the
second half of the year with an increased contribution from dry
cargo chartering, some important sale and purchase business and the
full year's contribution from Braemar Atlantic. We also invested in
the dry cargo and chemicals sector teams to improve the mix of our
broking capability. The forward order book remains strong at over
$40 million with a higher proportion due to be delivered in the
next twelve months than last year.
Our Financial division, which was created following the
acquisition of NAVES Corporate Finance GmbH in September 2017
reports its first full year of profits. This new division had an
extremely active year and built an extensive and growing pipeline
of mandated business and retainer income from both financial and
shipping clients. Based on the pipeline of business combined with
the ability to link up with other divisions, we believe that our
expectations at the time of the acquisition will be met.
Logistics traded steadily and reported a small increase in
underlying profit compared with the prior year.
There was a reported loss for the year from continuing
operations of GBP4.7 million (2018: GBP2.9 million) after taking
into account other specific items, mainly due to acquisition and
disposal related expenditure.
DIVID
The Directors are recommending, for approval at the Annual
General Meeting on 3 July 2019, a final dividend of 10.0 pence per
share.
This dividend will be paid on 26 July 2019 to those on the
register at close of business on 21 June 2019. Together with the
5.0 pence interim dividend, the Company's dividend for the year
will be 15.0 pence (2018: 15.0 pence). The last date for Dividend
Reinvestment Plan (DRIP) elections will be Friday 5 July 2019. As
part of the process of reshaping the Group and focusing on higher
margin business development, we are keeping the dividend policy
under review.
BOARD OF DIRECTORS
I am delighted to have taken over as Chairman on 15 April 2019,
and I look forward to working with the Board and the executive team
to drive long term sustainable value for the Group over the
upcoming years, to the benefit of all of our stakeholders.
The Board would like to thank David Moorhouse for his
contribution as Chairman over the past three years, and as a
Non-executive director for 10 years prior to that. Louise Evans
served as Finance Director until 22 June 2018 and Nick Stone joined
as Group Finance Director on 1 April 2019. Steve Kunzer joined the
Board as a Non-executive director on 26 February 2019, replacing
Mark Tracey who stepped down from the Board in September 2018.
On behalf of the Board, I would like to thank Louise and Mark
for their contribution during their time with Braemar, and to
welcome Nick and Steve to the Braemar Board.
COLLEAGUES
On behalf of the Board I would like to thank all of Braemar's
staff for their hard work and dedication over the last year. Their
knowledge, skills and commitment will be key ingredients of the
future success of the Group.
OUTLOOK
Shipbroking is set to have an interesting year of opportunities
as the shipping industry prepares for the International Maritime
Organisation's (IMO) low sulphur fuel regulations which become
effective internationally on 1 January 2020. The implementation of
these regulations will have multiple effects but overall is
expected to have a positive effect on freight markets, especially
for tankers. In addition, our investment in new talent,
particularly in the dry cargo sector, is contributing well and
adding to the breadth of our Shipbroking business.
Our Finance division is working on multiple mandates with
potential for significant success fees. They have also established
a track record of providing corporate finance advice to the
purchasers of shipping loan portfolios. This is an excellent
position from which to offer on-going strategic and restructuring
advice.
Logistics and Engineering both have significant commercial
prospects for growth over the coming year.
We are positive about the AqualisBraemar combination and very
much look forward to the development of this business and the
growth of our investment therein. The reshaping of the Group will
enable Braemar to focus on growing our higher margin services,
which will in turn improve our return on capital for
Shareholders.
Ronald Series
Chairman
19 May 2019
CHIEF EXECUTIVE'S STATEMENT
strategy
Braemar's strategy is to grow profits and build value for the
Group by developing the range of broking, advisory and logistics
services we offer. During the course of the year we completed the
disposal of Braemar Response and have also announced a plan to
combine our Technical division's business into Aqualis ASA in
exchange for a 26% equity stake, following which Braemar will
become the largest shareholder in the enlarged Aqualis Group. The
transaction also includes performance related warrants which will
be measured over a two year vesting period and offer the potential
to take our holding up to 33% overall.
The combination of our businesses will create a market leader in
offshore, marine, adjusting and renewables services with global
coverage. It also enables Braemar to focus on our core profitable
activities while retaining the ability to jointly market technical
services under the new trading name, AqualisBraemar. The Aqualis
management team has a strong track record for growing offshore and
marine consulting businesses and the combination of our businesses
puts us at the forefront of the sector at a time when further
consolidation is needed.
Following the acquisition of NAVES we have grown our presence in
maritime financial advisory by expanding this division
geographically.
We continue to employ key individuals and teams to expand the
Group in growth markets in which we are under-represented. During
the year we selectively added key talent in most market sectors
which has already had a beneficial impact on Group performance.
Our people are key to value creation and we remain committed to
the development of our staff so that individuals' careers can grow
over time and enhance internal succession.
TRADING PERFORMANCE
The Group's underlying operating profit from continuing
operations increased by GBP1.8 million from GBP7.3 million in
2017/18 to GBP9.1 million in 2018/19. After taking specific items
into account the statutory operating loss increased from GBP1.7
million to GBP2.7 million.
Revenue in our Shipbroking division in 2018/19 increased
noticeably to GBP75.5 million compared with GBP61.8 million in
2017/18 and underlying operating profit was GBP9.3 million compared
with GBP7.7 million in 2017/18. The acquisition of Atlantic Brokers
in the prior year combined with targeted recruitment to attract key
individuals and teams in growth markets has contributed to the
strong performance. Atlantic Brokers enables Braemar to expand its
range of derivative broking services to clients, and we expect to
leverage this capability to increase business in the coming year.
Tanker and dry cargo chartering both performed well in the second
half of the year.
The Financial division reported revenue of GBP7.0 million and
underlying operating profit of GBP2.1 million in its first full
year of operations within Braemar. The business has had an
extremely active year and built an extensive pipeline of mandated
business, in addition to securing retainer income from both
financial and shipping clients. We are confident that this division
will contribute a larger share of the Group's underlying operating
profit in future years and that expectations at the time of
acquisition will be met.
Revenue in the Logistics division reduced marginally from
GBP33.2 million to GBP32.1 million but underlying operating profit
increased to GBP0.84 million compared with GBP0.78 million in
2017/18. Our port agency business performed steadily in 2018/19
with revenue and underlying operating profit broadly in line with
expectations. The freight forwarding business operates in a
changing competitive market, but these forces have been somewhat
mitigated by our long-established relationships and a reputation
for reliable bespoke customer service.
Having carried out a significant restructuring of the Technical
division's cost base in 2016/17 and achieved a modest operating
profit in 2017/18, we expected the profit trajectory to continue to
improve. However, day rates have remained extremely low and
exploration expenditure has not recovered to anything like the
levels prior to 2014. The division struggled during the year and we
decided to seek a structural solution.
Following the agreement we have now reached to combine the
majority of our technical services assets with Aqualis, and the
acquisitions made in the prior year I am pleased that the Group was
able to improve its underlying profitability from continuing
operations. The reshaping of the Group focuses our business on high
margin marine and financial services.
James Kidwell
Chief Executive
19 May 2019
REVIEW OF OPERATIONS
SHIPBROKING
2018/19 2017/18
--------------------- ------------------ ----------------
Revenue GBP75.7 million GBP61.8 million
Underlying operating GBP9.3 million GBP7.7 million
profit
The Shipbroking division performed well and achieved a full year
performance ahead of expectations. Underlying operating profits
were GBP1.6 million (21%) higher than the prior year.
The tanker broking markets began the year with low earnings but
saw a recovery in the second half of the year. There was also a
healthy improvement in the dry cargo sector with some vessel
earnings achieving their highest level for seven years, although
the market has subsequently fallen back for reasons described
below. Sale and Purchase had a strong year with an increase in the
number of vessel sales at higher average values compared with last
year. Newbuilding was challenging but we added to our forward book.
Offshore started to see some market improvements at the end of the
year.
Our total forward order book at 1 March 2019 was $43.1 million
compared with $44.0 million at the start of the year. Approximately
$27.6 million of this is deliverable in 2019/20 compared with $24.0
million last year. This represents revenue from shipbroking
contracts where there are outstanding performance obligations that
are yet to be satisified.
We continued with our broking recruitment plan; adding further
talent to our broking teams across most sectors and we intend to
continue recruiting selectively, which has already achieved a
beneficial impact.
Deep-Sea Tankers
As expected, the weak deep-sea tanker market in 2017 continued
into the first half of the financial year. This was driven by an
overhang of excess tonnage, and cuts in crude oil production from
OPEC and other producers in order to reduce high global oil stocks.
The market rebounded strongly in the second half of the year as
OPEC increased its production and exports from the United States
rose sharply. This was helped by low fleet growth due to reduced
numbers of vessel deliveries and higher demolition.
Tanker demand is expected to remain strong with the main driver
being growth in US production and exports. Tanker tonne per mile
demand is likely to increase with most cargoes likely to go long
haul to Asia. Strong refinery demand with the incentive to raise
production of low sulphur fuel is likely to put pressure on OPEC to
increase production in the second half of the year, especially if
US sanctions further restrict crude exports from Venezuela and
Iran, as seems likely.
Fleet growth accelerated in early 2019, but the pace of
newbuilding deliveries is expected to ease in the second half of
the year. In addition, we expect to see the number of non-trading
vessels increase due to the additional time spent in drydock to fit
exhaust scrubbers. Fitting scrubbers enables larger tankers to
benefit from the relative cost differential between heavy fuel oil
and low sulphur product. There is also likely to be higher demand
for floating storage as fuel oil makes way for low sulphur fuels in
the world's bunkering ports.
Dry Cargo
During the year dry bulk earnings on average rose significantly,
however they weakened in the last quarter, with the Baltic Dry
Index ("BDI") falling 41% from 1,122 points at the end of February
2018 to 658 at the end of February 2019.
In the first half of 2018/19, the increase in earnings was led
by the Capesize sector which experienced growth in shipments of
higher-grade iron ore to China, from Brazil in particular,
providing strong vessel employment due to long-haul voyages.
Commodity demand was also strong across the other sectors,
especially in the minor bulks, due to China's economy shifting more
towards one driven by consumer demand. Newbuilding deliveries were
lower than in previous years and this, together with the low number
of vessels being demolished, kept tonnage tight.
The reduction in iron ore and coal demand in the second half of
the year exerted downward pressure on earnings. Iron ore shipments
were impacted by cyclonic weather in Australia and the tragic
failure of the tailing dam in Brumadinho, which immediately
decreased Brazil's output and Capesize earnings. Commodity demand
remained relatively strong across the other sectors, especially in
the minor bulks. The negative impact from the US-China trade war
started in April 2018, but did not impact volumes until the last
quarter, with the US selling its grain and soya beans, to
non-Chinese countries and Chinese buyers finding alternative
sources, mainly from South America.
Growth in the dry bulk market in 2019/20 will depend on several
key factors. Firstly, how quickly Brazil can return iron ore
production and exports to pre Brumadinho levels to service China's
drive to improve the efficiency of its steel industry and secondly,
whether there is an amicable trade agreement between the US and
China. With newbuild deliveries at modest levels in 2019/20, vessel
earnings will be more dependent on demand fluctuations in the year
ahead.
Specialised Tankers
Our specialised tanker department covers the transportation of
LNG, LPG, petrochemical gases, chemicals and smaller parcels of
refined products.
The LNG tanker market in 2018/19, saw significant growth in spot
earnings as new production came on stream. With further new
production planned for 2019/20, growth in traded volumes will
continue. Demand for shipping should exceed available tonnage over
the next few years with spot earnings expected to remain at a
healthy level. Over time the number of speculative orders for
newbuilds beyond 2020 is likely to re-balance the market.
The LPG market in 2018/19 saw some recovery in freight rates as
tonnage tightened through fewer deliveries of new vessels and an
increased number of scrapped vessels. Volumes were adversely
impacted by the US-China trade war but did recover as Chinese
demand was satisfied from the Middle East and the US volumes were
sold to other Asian markets. The outlook for the LPG market in
2019/20 is one of further modest growth.
The Chemical market in 2018/19 experienced a slowdown with a
tonnage surplus on many routes. Arbitrage windows gave short-lived
regional opportunities, but not enough to sustain increased freight
rates. Going into 2019/20, we are witnessing increased activity,
indicating a more positive outlook and some charterers are already
considering longer term contracts.
Second hand sale and purchase and newbuilding
In 2018/19, the team concluded a higher volume of second hand
and demolition vessel transactions at a higher average commission
compared with 2017/18. Most vessel sales were dry bulk carriers
reflecting the upward trend in that market.
During the year we secured multiple VLCC and Suezmax newbuilding
orders which adds to our forward order book. This was achieved
despite a relatively low number of newbuilding orders being placed
last year.
Our second half benefitted from the delivery of a fleet of 13
dry bulk vessels. Despite weak tanker freight rates, which led to a
reduced number of quality tanker vessels being sold, our team
managed to increase tanker sales compared with last year.
Demolition sales for the period were similar to last year.
Looking ahead, we are expecting to see an increase in activity
as the IMO's environmental regulations take effect by 1 January
2020.
Offshore
The supply boat market continued to be impacted by vessel
overcapacity and low global oil and gas exploration activity. The
oil price strengthened during the first half of 2018/19 but then
weakened going into the last quarter. This uncertainty continues to
constrain any increase in spend in exploration and production. If
the oil price remains stable and above $70/barrel, then we expect
more projects to commence, which should drive demand.
Securities
Atlantic Brokers Holdings Limited, which was acquired at the end
of the last financial year, was successfully integrated as a
regulated coal desk, Braemar Atlantic Securities. The subsequent
addition of a dry Forward Freight Agreement ("FFA") broking team
also complemented our broking services and the desk now has a team
of 12 brokers across coal and dry FFAs. The dry FFA derivatives
market grew as the physical market improved. However, the coal
derivative market has been relatively subdued so far this year.
Braemar continues to be the leading physical broker for certain
markets.
FINANCIAL
2018/19 2017/18
--------------------- --------------- ---------------
Revenue GBP7.0 million GBP3.7 million
Underlying operating GBP2.1 million GBP1.8 million
profit
Since its acquisition by Braemar, Braemar-NAVES has expanded its
global footprint by establishing a presence in London and Singapore
together with an ability to work with the important Chinese
financing market, working with Braemar's sale and purchase team in
the Far East. Through its close cooperation with both the
Shipbroking and the Technical divisions it has been able to offer
integrated advisory services for private equity and hedge funds. We
have established a market position as a debt advisor and debt
broker for international ship owners. This aspect of our business
is growing because traditional shipping banks have restricted their
lending activity and in some cases withdrawn from the market
altogether. Exceptional circumstances in the prior past year
contributed to an unusually high margin, which is now more
normalised.
Restructuring and Interim management and pre/post-insolvency
management
Restructuring and related services continued to contribute
significantly to the performance of Braemar-NAVES. During 2018/19
we supported restructurings in Germany, Greece, Cyprus and India.
Our pre-and post-insolvency and management business was strong in
2018/2019. However, we expect this element of our business to form
a lower proportion of our overall business in the future, as
several shipping sectors are now generating enough cash flow to
allow owners and lenders to seek a compromise that avoids
insolvency filing procedures. An early sign of this is our
increasing activity in supporting owners to refinance or replace
bank debt.
Asset brokerage / control of sales processes for individual
assets / M&A
Braemar-NAVES and Braemar ACM worked together closely and
successfully led the disposal process for a variety of container
vessels, tankers and dry bulk vessels. In the course of the
financial year 2018/19 we experienced an increasing demand for our
services to support the disposal of entire shipping companies or
portfolios. We expect this to contribute more significantly to our
performance in the coming year.
Equity and debt financing
Last year the Division successfully refinanced more than 20
vessels. Our mandate flow for financing support is often driven by
the change of ownership of bank loan portfolios and the reduction
of exposure of traditional shipping lenders. NAVES has developed a
strong market presence with regard to raising debt from alternative
capital providers and this is expected to continue in 2019/20,
because large loan exposures will be transferred to new owners in
2019/20 and we supported due diligence activities on such
portfolios during 2018/19. We have established a large network of
private equity funds, investment funds, credit funds, alternative
capital providers and leasing companies together with strong
working relationships with most of the traditional shipping
lenders.
Loan transaction support and Financial Asset Management
Our business has shifted in this area and we have become a
leading buy side adviser for the acquisition of shipping loan
portfolios, often drawing in some of Braemar's other services. This
has more than made up for a decline in financial asset management
services where traditional lenders have a lower demand for asset
warehousing. This position is based on our unique service offering
combining commercial, technical and financial due diligence in
combination with the research and valuation desks, which has led to
repeat assignments from several investors. Strategically, this
business is of importance as it gives us a close understanding of
our client priorities allowing us to support owners in the
refinancing of their loans.
Geographic diversification
With the establishment of offices in London in 2017 and
Singapore in 2018 we are diversifying and building our global
presence and plan to develop our presence in other cities in the
future. We continue to review geographic expansion opportunities to
strengthen our links with institutional investors as well as
leveraging our services within the wider Braemar Group.
LOGISTICS
2018/19 2017/18
--------------------- ---------------- ----------------
Revenue GBP32.1 million GBP33.2 million
Underlying operating GBP0.8 million GBP0.8 million
profit
Port & Hub agency
The Ship Agency business services UK ports, the port of
Singapore, North America and the Netherlands and has joint
arrangements with a number of worldwide agency partners via our UK
based hub management business.
The majority of our port agency business arises from our
activity in UK ports where we are a clear market leader together
with our global hub activity coordinated out of the UK. Underlying
revenue in both the UK and the hub were higher than prior year and
ahead of expectations. We continue to face competitive challenges
from both established and new operators in the UK, but our
long-established relationships and reputation for excellent
customer service has meant that their impact in the year was not
significant.
Overseas, our Dutch operation was in line with prior year, and
in the US our underlying revenue grew 30% on the back of increased
business in our established Houston office and the addition of a
new office in New Jersey.
Liner Agency & Freight forwarding
The Liner Agency business has maintained its long-standing
relationships with key clients on the basis of high service levels
which has seen revenue grow by 10% versus the prior year. In
freight forwarding, our business with key customers remained solid
and our export business grew significantly. However, this was
offset by contraction in our imports business and road haulage. We
also had a quiet year in project cargo which may be a BREXIT
related effect, although the new financial year has begun more
positively in this sector.
Many of our customers have been seeking our advice to prepare
for all eventualities of BREXIT. We have seen some stockpiling
taking place and our custom clearance skills could be much in
demand if the UK does exit the customs union.
ENGINEERING
2018/19 2017/18
--------------------- ----------------- -----------------
Revenue GBP3.1 million GBP4.2 million
Underlying operating GBP(0.3) million GBP(0.1) million
profit
Trading was broadly in line with the prior year with a
relatively low level of marine supervision work for LNG
newbuildings. We expect an upturn in the current year, with an
improved pipeline compared with Spring 2018. A contract for the
provision of newbuilding supervision services for an LNG tanker was
signed in December 2018 which will generate engineering income into
2020 and future time charter brokerage for the Shipbroking
division.
DISCONTINUED OPERATIONS - TECHNICAL
The Technical division continued to operate in a difficult
trading environment, and despite cost savings made in 2016/17, the
ongoing low levels of activity in the upstream energy and marine
sectors resulted in a reduction of profitability compared with last
year.
The Group looked at the options to improve financial performance
and recently announced a transaction with Aqualis ASA whereby
Braemar's Adjusting, Marine and Offshore businesses will be sold to
Aqualis in exchange for 26% equity stake which will make Braemar
the largest shareholder in the enlarged group. This is the best
value creating solution for these businesses which collectively
have recorded losses in recent years.
The AqualisBraemar combination will immediately create a global
market leader in marine, offshore and renewables services. The
increased scale will unlock revenue and cost synergies through
better staff utilisation and overhead efficiencies.
The Group is retaining Braemar Engineering where the team is
working closely with the Shipbroking division on several ongoing
LNG projects and further combined work is expected. The figures
quoted above relate just to the ongoing operations in this part of
the division.
We also concluded the divestment of Braemar Response to Grupo
Ambipar on 10 October 2018.
A commentary on the trading of the discontinued businesses
during 2018/9 follows:
Offshore
The business continued to be affected by the low level of
activity in oil and gas exploration and production. We experienced
price reductions on some contracts and contract delays in a number
of locations where energy projects did not progress as quickly as
we anticipated. The underperformance was partially mitigated by
overhead savings. Among our clients, the overall level of activity
appears to be growing compared to this time last year, and we
secured a number of framework agreements with regional engineering
companies. We also signed agreements in early 2019 with
underwriters for the provision of marine warranty surveys for two
large project cargo contracts in China and Australia. Our Vietnam
and Indian offices continue to perform well.
Marine
Braemar Marine maintained its high market share for Hull and
Machinery inspections emanating from the Lloyds Insurance market.
Professional staff utilisation averaged 56% in the year, a slight
decrease compared to 2017/18. We have sought to broaden the
business by developing pre-risk inspection services for superyachts
and technical due diligence for financial services businesses.
Adjusting
Performance was affected by a low level of upstream claims
during 2018/19, the impact of staff turnover and the impact of the
US trade sanctions which resulted in one significant project being
placed on hold indefinitely. The Singapore office secured a number
of contracts for the provision of expert witness services.
FINANCIAL REVIEW
The Group has taken significant steps to improve underlying
operating profit in the last two years including two acquisitions
and since year-end the sale of a loss-making division. This is
evident in the increased underlying operating profit from
continuing operations delivered during the year.
Summary Income Statement
2019 2018
Continuing Operations GBP'000 GBP'000
----------------------------------- -------- --------
Revenue 117,853 103,043
Cost of sales (24,892) (24,673)
Operating costs (81,060) (68,193)
Central costs (2,835) (2,855)
----------------------------------- -------- --------
Underlying operating profit before
specific items 9,066 7,322
Acquisition and disposal related
expenditure (10,960) (9,067)
Restructuring costs (759) -
Operating (loss)/profit (2,653) (1,745)
----------------------------------- -------- --------
Divisional Highlights
2019 2018
GBP'000 GBP'000
----------------------------------- -------- --------
shipbroking
----------------------------------- -------- --------
Revenue 75,691 61,846
Underlying operating profit 9,332 7,742
Underlying operating profit margin 12.3% 12.5%
Employee numbers(i) 301 298
----------------------------------- -------- --------
FINANCIAL
----------------------------------- -------- --------
Revenue 6,951 3,747
Underlying operating profit 2,128 1,785
Underlying operating profit margin 30.6% 47.6%
Employee numbers(i) 20 17
----------------------------------- -------- --------
LOGISTICS
----------------------------------- -------- --------
Revenue 32,065 33,237
Underlying operating profit 841 777
Underlying operating profit margin 2.6% 2.3%
Employee numbers(i) 192 194
----------------------------------- -------- --------
ENGINEERING
----------------------------------- -------- --------
Revenue 3,146 4,213
Underlying operating loss (311) (127)
Underlying operating profit margin (9.9)% (3.1)%
Employee numbers(i) 16 15
----------------------------------- -------- --------
(i) Average annual equivalent number of employees.
Overview
Group results have improved during the year, with underlying
operating profit increasing to GBP9.1 million from GBP7.3 million.
The net impact of costs of acquisitions transactions and the
accounting treatment for certain items of consideration are
separately identified as specific items and have resulted in an
operating loss of GBP2.7 million for the year (2017/18: GBP1.7
million loss).
In the trading update issued on 25 January 2019, an indication
was given of underlying operating profit for the year in a range of
GBP6.8 million to GBP7.2 million. On a like for like basis the
outturn for the year was GBP7.0 million. This can be reconciled to
the reported numbers as follows:
Reported underlying operating profit GBP9.1m
Deduct Technical Division losses reported in discontinued GBP(1.7)m
operations
Deduct Adjustments due to the adoption of IFRS 9 & GBP(0.4)m
15 (see below)
Adjusted underlying operating profit GBP7.0m
--------------------------------------------------------- ---------
Direct and operating costs
Cost of sales comprise of freight and haulage costs incurred in
the Logistics division and payments to sub-contractors, materials,
and other costs directly associated with the revenue to which they
relate to in other divisions. Operating costs have increased
primarily to the increased levels of bonus in Shipbroking and a
full year of NAVES costs.
Specific items
We have separately identified certain items that we do not
consider to be part of the ongoing trade of the Group. These
significant items are material in both size and/or nature and we
believe may distort understanding of the underlying performance of
the business. These are summarised below:
Acquisition & Disposal Related Expenditure
We have accounted for GBP10.6 million (2017/18: GBP6.7 million)
acquisition related charges during the year, with this increase
driven by the acquisitions of NAVES Corporate Finance GmbH and
Atlantic Brokers Holdings Limited. Of these acquisition related
specific items, only GBP1.4 million was paid during the period in
cash.
The Group incurred GBP8.0 million of costs which are directly
linked to the acquisition of NAVES. They include GBP7.2 million of
post-acquisition consideration payable to certain sellers under the
terms of the acquisition agreement. The Braemar-NAVES acquisition
agreement included substantial payments to the working vendors
which are conditional on their continuing employment. These
elements of the consideration will be accounted in the income
statement over the relevant period.
Costs incurred on the Braemar Atlantic acquisition were GBP2.5
million of post-acquisition consideration payable to certain
sellers under the terms of the acquisition agreement.
When we acquired ACM Shipping Group plc in July 2014, we
established a share plan to retain key staff. The cost of this
share plan is categorised as acquisition-related expenditure and
the charge in the year was GBP0.1 million (2017/18: GBP0.6
million). As expected, the annual charge relating to these awards
reduces as these awards vest.
During the year we also incurred a charge of GBP1.1 million
(2017/18: GBP2.45 million) in relation to the amortisation of
intangible assets arising from these acquisitions.
Discontinued operations
Following the Board's decision to dispose of the majority of the
Group's Technical Division, we have classified the operations from
these business units as a discontinued operation. As a result, the
results from these operations do not form part of the Group's
underlying performance. Comparative periods have been restated to
reflect consistent reporting between periods. In this
classification we also report the losses made on the disposal of
Braemar Response in October 2018.
The discontinued operations made a total post-tax loss of
GBP22.7 million in the year, of which GBP1.4 million relates to
Braemar Response. The GBP21.3 million reported on the disposal of
the Technical Division business units is an aggregation of the
trading losses and an estimate of the loss that will be made upon
completion and can be explained in more detail as follows:
GBP'm
----------------------------------- -------
Trading loss made in the year 1.7
Tax credit (0.1)
Restructuring costs and attributed
interest 0.6
Write down of intangible assets 6.1
Estimated impairment of remaining
net assets 13.0
Total reported loss 21.3
----------------------------------- -------
The assets held for sale include certain assets and cash that
will be redistributed to Braemar under a reorganisation that will
be carried out as part of the disposal and before completion. The
impairment of the remaining net assets of the business units is
required to align their carrying value to the estimated value of
consideration to be received in the sale transaction, net of the
anticipated level of fees and other costs incurred.
Other Specific Items
We have incurred GBP0.8 million of one-off costs related to
Board changes. In addition, we have revalued our investment in
seats on the London Tankers Brokers Panel in line with recent third
party transactions.
Adoption of IFRS 9 and IFRS 15
During this accounting period the Group has adopted IFRS 9
'Financial Instruments' and IFRS 15 'Revenue from contracts with
customers' for the first time as is described in more detail in
Note 2 below. The impact of this adoption on the reported results
is included within underlying operating profit and can be
summarised as follows:
GBP'000 IFRS 9 IFRS15 Total
-------------------------------------- ------- ------- -------
Decrease in Net Assets at 28 February
2018 (1,081) (1,121) (2,202)
Increase in underlying profit
for the period to
28 February 2019 292 113 405
Decrease in Net Assets at 28 February
2019 (789) (1,008) (1,797)
Finance costs
The net finance cost for the year of GBP1.2 million (2017/18:
GBP0.6 million) reflects the cost of working capital associated
with the facilities structures held with HSBC and the interest
payable on financing and convertible loan notes associated with the
acquisition of NAVES. GBP0.2 million has been attributed to
underlying operations (2017/8: GBP0.4 million), GBP0.8 million to
NAVES acquisition (2017/8 GBP0.2 million) and GBP0.3 million to the
discontinued operations (2017/18: GBP0 million).
Capital expenditure
In 2018/19 total capital expenditure was GBP1.7 million
(2017/18: GBP1.0 million). The most significant item of capital
expenditure relates to software as we continue the improvement of
our operating and finance systems.
Balance sheet
Net assets at 28 February 2019 were GBP58.4 million (2018:
GBP93.7 million).
The Group has continued to focus on working capital improvement
and cash collection during the year. At 28 February 2019 the Group
held gross trade receivables before impairment provisions of
GBP31.5 million, down from GBP37.9 million at 28 February 2018. At
the year end, total trade and other receivables had fallen by
GBP14.7 million to GBP37.9 million from the GBP52.6 million
reported last year which included total of GBP11.2 million held for
resale relating to the Technical Division business units being
disposed of. The proportion of trade receivables provided against
fell from 12.2% to 8.0%.
Borrowings and cash
At the balance sheet date, the Group had facilities of GBP40
million, made up of a revolving credit facility of GBP25 million
for current activities and an accordion facility of GBP15 million
for potential future acquisitions provided by HSBC. As part of the
Aqualis transactions the HSBC facilities have been renegotiated to
a revolving credit facility of GBP35 million and a facility of GBP5
million. At the same time the covenants governing the facility have
been amended to allow additional headroom.
The Group also has access to a global cash pooling facility in
UK, Germany and Singapore which allows efficient management of
liquidity between our main regional hubs. At the end of the year
the Group had net debt of GBP7.8 million (2018: GBP2.4
million).
Retirement benefits
The Group has a defined benefit pension scheme which was closed
to new members during 2015/16. The scheme has a net liability of
GBP2.0 million (2017: GBP3.4 million) which is recorded on the
balance sheet at 28 February 2019. The agreed annual
scheme-specific funding since the triennial valuation as at March
2014 was a cash contribution of GBP0.5 million. The triennial
funding valuation as at March 2017 was carried out and concluded
during 2018 and the result was an unchanged annual employer cash
contribution of GBP0.5 million which was agreed with the trustees
and is being paid in equal monthly instalments.
Convertible loan notes and deferred consideration
In total, the Group has committed to the issue of up to EUR24.0
million convertible loan note instruments in respect of the
acquisition of NAVES. These convertible loan note instruments are
unsecured, unlisted and non-transferable. The notes are Euro
denominated and carry a 3% per annum coupon. Each tranche is
redeemable on or after two years from the date of issue by the
Group or by the individual holder. The conversion prices were fixed
at 390.3p for management sellers and 450.3p for non-management
sellers.
The fair value of convertible instruments and deferred
consideration as at 28 February 2019 was GBP16.9 million (2018:
GBP10.7 million). The status of maximum future payments assuming
all are redeemed for cash and future income statement charges can
be summarized as follows:
February February February February
Year Ended 2020 2021 2022 2023 & beyond
---------------------------- -------- -------- -------- --------------
Maximum cash payable GBP'm
Deferred consideration loan
notes 7.1 1.8 1.2 2.5
Earn out notes 3.2 3.2 3.2
---------------------------- -------- -------- -------- --------------
Maximum Cash Payable 7.1 5.0 4.4 5.7
---------------------------- -------- -------- -------- --------------
Maximum income statement
charge 3.1 1.1 0.2
---------------------------- -------- -------- -------- --------------
The final value of the February 2022 and 2023 earnout notes will
be determined based on earnings to August 2019 and 2020
respectively.
Foreign exchange
The US dollar exchange rate has moved from US$1.40/GBP1 at the
start of the year to US$1.33/GBP1 at the end of the year. A
significant proportion of the Group's revenue is earned in US
dollars. At 28 February 2019, the Group held forward currency
contracts to sell US$15.5 million at an average rate of $1.365/GBP1
and options over a further US$9.5 million at an average rate of
$1.368/GBP1.
Taxation
The Group's underlying effective tax rate in relation to
continuing operations in 2018/19 was 17.2% (2018: 18.6%), which is
lower than current UK tax rate. Higher tax rates in Germany and
Australia have been more than offset by some prior year tax credits
in the UK. We have also continued to focus on our global operations
to manage our tax exposure which has allowed us to maintain a lower
rate despite relatively high levels of disallowable expenditure.
The effective tax rate on statutory profit is a credit of 48%
(2018: credit of 20%) and is distorted by the non-deductibility for
tax purposes of the specific acquisition related items.
Alternative profit measures ("APMs")
Braemar uses APMs as key financial indicators to assess the
underlying performance of the Group. Management considers the APM's
used by the Group to better reflect business performance and
provide useful information to investors and other interested
parties. In particular, we have separated the impact of
individually material capital transactions, such as acquisitions
and disposals, from ongoing trading activity to allow focus on
ongoing operational performance.
Our APMs include underlying operating profit and underlying
earnings per share. Our prior year APMs have been restated to
reflect the reclassification of discontinued operations noted
above.
Reconciliation of underlying results to reported statutory
results:
Year ended 28 Year ended 28
Feb 2019 Feb 2018
GBP'000 GBP'000
------------------------------------------- ------------- -------------
Revenue 117,853 103,043
Cost of sales (24,892) (6,644)
-------------------------------------------- ------------- -------------
Gross profit 92,961 96,399
Other operating costs (83,895) (89,077)
-------------------------------------------- ------------- -------------
Underlying operating
profit 9,066 7,322
Net underlying finance
costs (197) (461)
-------------------------------------------- ------------- -------------
Underlying profit before
tax 8,869 6,861
-------------------------------------------- ------------- -------------
Underlying taxation (1,669) (1,019)
-------------------------------------------- ------------- -------------
Underlying profit for
the year 7,200 5,842
-------------------------------------------- ------------- -------------
Underlying earnings per ordinary
share
Basic 23.32p 19.57p
Diluted 21.36p 18.06p
-------------------------------------------- ------------- -------------
Underlying operating
profit 9,066 7,322
Specific items (11,719) (9,067)
-------------------------------------------- ------------- -------------
Operating (loss)/profit (2,653) (1,745)
Gain on revaluation of
investment 500 -
Net finance costs (987) (643)
-------------------------------------------- ------------- -------------
(Loss)/profit before
taxation (3,140) (2,388)
-------------------------------------------- ------------- -------------
Taxation (1,525) (474)
-------------------------------------------- ------------- -------------
(Loss)/profit for the year from continuing
operations (4,665) (2,862)
-------------------------------------------- ------------- -------------
Loss for the year from
discontinued operations (22,700) (32)
-------------------------------------------- ------------- -------------
Profit/(loss) for the year attributable
to equity shareholders of the parent (27,365) (2,894)
-------------------------------------------- ------------- -------------
Earnings per ordinary
share
Basic (88.63p) (9.70)p
Diluted (88.63p) (9.70)p
-------------------------------------------- ------------- -------------
Capital Management
The Group manages its capital structure and adjusts it in
response to changes in economic conditions and its capital needs.
To maintain or adjust the capital structure, the Group may adjust
the dividend payment to shareholders, return capital to
shareholders or issue new shares and debt instruments. The Group
has a policy of maintaining positive cash balances whenever
possible which can be supported by short-term use of its revolving
credit facility. This is drawn down as required to provide cover
against the peaks and troughs in our working capital
requirements.
ESOP Trust
During the year the Company requested that SG Kleinwort Hambros
Trust Company (CI) Ltd, as Trustee of the Company's ESOP Trust,
purchase shares in Braemar Shipping Services plc.
As announced on 2 March 2018, the Company entered into a trading
plan with the Trustee for the period 5 March 2018 to 14 May 2018
for the purchase of 250,000 shares. A further trading plan was
announced on 31 August 2018 to purchase a further 150,000 shares.
These plans enabled the Trustee to operate with discretion and
independence to purchase ordinary shares in the Company for the
ESOP. An additional 316,000 shares were purchased in January 2019
making a total of 716,000 shares in the Company for the period. At
17 May 2019 the ESOP holds 696,201 shares.
Dividend
The directors are recommending, for approval at the Annual
General Meeting on 3 July 2019, a final dividend of 10 pence.
Together with the interim dividend, the Company's dividend for the
year will be 15 pence (2018: 15 pence) and is covered of 1.6x by
underlying earnings per share of 23.32p (2018: 1.3x by 19.57p).
Brexit
We do not currently believe that our businesses will be
materially impacted by Brexit as we are a global organisation with
limited exposure to the European markets. However, we remain
concerned over the uncertainty and risks associated with the
potential economic volatility arising from Brexit and continue to
closely monitor developments.
.
Nicholas Stone
Group Finance Director
19 May 2019
Consolidated income statement
for the year ended 28 February 2019
Continuing 28 Feb 28 Feb 2018
operations 2019
------------------- ----------- --------- ---------------------------------------------------------- ---------
Underlying Specific Total Underlying Specific Total
GBP'000 items GBP'000 GBP'000 items GBP'000
GBP'000 GBP'000
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Revenue 2 117,853 - 117,853 103,043 - 103,043
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Cost of sales (24,892) - (24,892) (24,673) - (24,673)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Gross profit 92,961 - 92,961 78,370 - 78,370
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Operating expense:
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Other operating
costs 4 (83,895) (759) (84,654) (71,048) - (71,048)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Acquisition and
disposal-related
expenditure 4 - (10,960) (10,960) - (9,067) (9,067)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
(83,895) (11,719) (95,614) (71,048) (9,067) (80,115)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Operating
profit/(loss) 2 9,066 (11,719) (2,653) 7,322 (9,067) (1,745)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Gain on
revaluation
of investment - 500 500 - - -
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Finance income 297 - 297 79 - 79
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Finance costs 4 (494) (790) (1,284) (540) (182) (722)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
(Loss)/profit
before
taxation 8,869 (12,009) (3,140) 6,861 (9,249) (2,388)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Taxation (1,669) 144 (1,525) (1,019) 545 (474)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
(Loss)/profit for
the year from
continuing
operations 4 7,200 (11,865) (4,665) 5,842 (8,704) (2,862)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Loss for the year
from discontinued
operations 5 - (22,700) (22,700) - (32) (32)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Profit/(loss) for
the year
attributable
to equity
shareholders
of the parent 7,200 (34,565) (27,365) 5,842 (8,736) (2,894)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Total
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Earnings per
ordinary
share
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Basic 7 23.32 (88.63) 19.57 (9.70)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Diluted 7 21.36 (88.63) 18.06 (9.70)
------------------- ----------- --------- ------------------ ------------------ ------------------ ---------
Continuing operations
------------------------- ------ -------- ------ -------
Earnings per ordinary
share
------------------------- ------ -------- ------ -------
Basic 7 23.32 (15,11) 19.57 (9.70)
------------------------- ------ -------- ------ -------
Diluted 7 21.36 (15,11) 18.06 (9.70)
------------------------- ------ -------- ------ -------
Consolidated statement of comprehensive income
for the year ended 28 February 2019
28 Feb 28 Feb
Notes 2019 2018
GBP'000 GBP'000
------------------------------------------------------ -------- -------- --------
Loss for the year (27,365) (2,894)
---------------------------------------------------------------- -------- --------
Other comprehensive income/(expense)
------------------------------------------------------ -------- -------- --------
Items that will not be reclassified to profit
or loss:
------------------------------------------------------ -------- -------- --------
Actuarial gain/(loss) on employee benefit schemes
- net of tax 999 339
---------------------------------------------------------------- -------- --------
Items that are or may be reclassified to profit
or loss:
------------------------------------------------------ -------- -------- --------
Foreign exchange differences on retranslation
of foreign operations (2,999) (3,674)
---------------------------------------------------------------- -------- --------
Cash flow hedges - net of tax (229) 808
---------------------------------------------------------------- -------- --------
Total comprehensive expense for the year attributable
to equity shareholders of the parent (29,594) (5,421)
---------------------------------------------------------------- -------- --------
The accompanying notes form an integral part of these Financial
statements.
Balance sheets
as at 28 February 2019
Notes As at As at
28 Feb 28 Feb
2019 2018
GBP'000 GBP'000
--------------------------------------------- ------ --------- ---------
Assets
--------------------------------------------- ------ --------- ---------
Non-current assets
--------------------------------------------- ------ --------- ---------
Goodwill 83,812 88,961
--------------------------------------------- ------ --------- ---------
Other intangible assets 2,226 3,393
--------------------------------------------- ------ --------- ---------
Property, plant and equipment 1,978 3,322
--------------------------------------------- ------ --------- ---------
Investments 1,773 1,356
--------------------------------------------- ------ --------- ---------
Deferred tax assets 1,640 3,120
--------------------------------------------- ------ --------- ---------
Other long-term receivables 264 300
--------------------------------------------- ------ --------- ---------
91,693 100,452
--------------------------------------------- ------ --------- ---------
Current assets
--------------------------------------------- ------ --------- ---------
Trade and other receivables 37,128 52,605
--------------------------------------------- ------ --------- ---------
Derivative financial instruments - 159
--------------------------------------------- ------ --------- ---------
Assets held for sale 5 10,611 2,865
--------------------------------------------- ------ --------- ---------
Cash and cash equivalents 3,590 5,424
--------------------------------------------- ------ --------- ---------
51,329 61,053
--------------------------------------------- ------ --------- ---------
Total assets 143,022 161,505
--------------------------------------------- ------ --------- ---------
Liabilities
--------------------------------------------- ------ --------- ---------
Current liabilities
--------------------------------------------- ------ --------- ---------
Derivative financial instruments 49 -
--------------------------------------------- ------ --------- ---------
Trade and other payables 44,887 41,462
--------------------------------------------- ------ --------- ---------
Short-term borrowings 15,323 7,873
--------------------------------------------- ------ --------- ---------
Current tax payable 1,408 1,858
--------------------------------------------- ------ --------- ---------
Provisions 90 320
--------------------------------------------- ------ --------- ---------
Convertible loan notes 6,339 -
--------------------------------------------- ------ --------- ---------
Deferred consideration 600 336
--------------------------------------------- ------ --------- ---------
Liabilities directly associated with assets
classified as held for sale 5 2,797 766
--------------------------------------------- ------ --------- ---------
71,493 52,645
--------------------------------------------- ------ --------- ---------
Non-current liabilities
--------------------------------------------- ------ --------- ---------
Deferred tax liabilities 930 999
--------------------------------------------- ------ --------- ---------
Provisions 324 424
--------------------------------------------- ------ --------- ---------
Convertible loan notes 4,579 7,364
--------------------------------------------- ------ --------- ---------
Deferred consideration 5,357 2,977
--------------------------------------------- ------ --------- ---------
Pension deficit 1,986 3,437
--------------------------------------------- ------ --------- ---------
13,176 15,201
--------------------------------------------- ------ --------- ---------
Total liabilities 84,669 67,846
--------------------------------------------- ------ --------- ---------
Total assets less total liabilities 58,353 93,659
--------------------------------------------- ------ --------- ---------
Equity
--------------------------------------------- ------ --------- ---------
Share capital 3,144 3,144
--------------------------------------------- ------ --------- ---------
Share premium 55,805 55,805
--------------------------------------------- ------ --------- ---------
Shares to be issued (3,446) (2,701)
--------------------------------------------- ------ --------- ---------
Other reserves 22,857 26,085
--------------------------------------------- ------ --------- ---------
Retained earnings (20,007) 11,326
--------------------------------------------- ------ --------- ---------
Total equity 58,353 93,659
--------------------------------------------- ------ --------- ---------
Cash flow statements
for the year ended 28 February 2019
Group
--------------------
Notes 28 Feb 28 Feb
2019 2018
GBP'000 GBP'000
-------------------------------------------------- ------ --------- ---------
Cash flows from operating activities
-------------------------------------------------- ------ --------- ---------
Cash generated from operations 8 8,871 3,383
-------------------------------------------------- ------ --------- ---------
Interest received 297 95
-------------------------------------------------- ------ --------- ---------
Interest paid (1,187) (619)
-------------------------------------------------- ------ --------- ---------
Specific items (759) -
-------------------------------------------------- ------ --------- ---------
Tax paid (1,078) (119)
-------------------------------------------------- ------ --------- ---------
Net cash generated from operating activities 6,144 2,740
-------------------------------------------------- ------ --------- ---------
Cash flows from investing activities
-------------------------------------------------- ------ --------- ---------
Purchase of property, plant and equipment
and computer software (2,807) (960)
-------------------------------------------------- ------ --------- ---------
Acquisition of businesses, net of cash
acquired - (5,933)
-------------------------------------------------- ------ --------- ---------
Proceeds from disposal of Investments 300 -
-------------------------------------------------- ------ --------- ---------
Proceeds from sale of property, plant 77 -
and equipment
-------------------------------------------------- ------ --------- ---------
Other long-term assets 35 110
-------------------------------------------------- ------ --------- ---------
Net cash used in investing activities (2,395) (6,783)
-------------------------------------------------- ------ --------- ---------
Cash flows from financing activities
-------------------------------------------------- ------ --------- ---------
Proceeds from borrowings 14,450 11,537
-------------------------------------------------- ------ --------- ---------
Repayment of borrowings (7,000) (4,285)
-------------------------------------------------- ------ --------- ---------
Proceeds from issue of ordinary shares, - -
excluding acquisitions
-------------------------------------------------- ------ --------- ---------
Dividends paid (4,616) (2,974)
-------------------------------------------------- ------ --------- ---------
Gift to ESOP for purchase of shares (1,712) (1,073)
-------------------------------------------------- ------ --------- ---------
Deferred consideration (1,710) -
-------------------------------------------------- ------ --------- ---------
Net cash (used in)/generated from financing
activities (588) 3,205
-------------------------------------------------- ------ --------- ---------
Increase/(decrease) in cash and cash equivalents 3,161 (838)
-------------------------------------------------- ------ --------- ---------
Cash and cash equivalents at beginning
of the period 5,424 7,674
-------------------------------------------------- ------ --------- ---------
Foreign exchange differences (1,085) (1,412)
-------------------------------------------------- ------ --------- ---------
Cash and cash equivalents at end of the
period 7,500 5,424
-------------------------------------------------- ------ --------- ---------
Statements of changes in total equity
for the year ended 28 February 2019
Share Share Shares Other Retained Total
capital premium to reserves earnings equity
Group GBP'000 GBP'000 be issued GBP'000 GBP'000 GBP'000
GBP'000
------------------------------------- -------- -------- ---------- --------- --------- --------
At 28 February 2017 3,018 52,510 (2,962) 28,951 18,655 100,172
------------------------------------- -------- -------- ---------- --------- --------- --------
Loss for the year - - - - (2,894) (2,894)
------------------------------------- -------- -------- ---------- --------- --------- --------
Actuarial gain on employee benefits
schemes - net of tax - - - - 339 339
------------------------------------- -------- -------- ---------- --------- --------- --------
Foreign exchange differences - - - (3,674) - (3,674)
------------------------------------- -------- -------- ---------- --------- --------- --------
Cash flow hedges - net of tax - - - 808 - 808
------------------------------------- -------- -------- ---------- --------- --------- --------
Total recognised expense in the
year - - - (2,866) (2,555) (5,421)
------------------------------------- -------- -------- ---------- --------- --------- --------
Dividends paid - - - - (2,974) (2,974)
------------------------------------- -------- -------- ---------- --------- --------- --------
Issue of shares 126 3,295 - - - 3,421
------------------------------------- -------- -------- ---------- --------- --------- --------
Gift to ESOP for purchase of own
shares - - (1,073) - - (1,073)
------------------------------------- -------- -------- ---------- --------- --------- --------
ESOP shares allocated - - 1,334 - (2,629) (1,295)
------------------------------------- -------- -------- ---------- --------- --------- --------
Share based payments - - - - 1,662 1,662
------------------------------------- -------- -------- ---------- --------- --------- --------
Deferred tax on items taken to
equity - - - - (833) (833)
------------------------------------- -------- -------- ---------- --------- --------- --------
At 28 February 2018 3,144 55,805 (2,701) 26,085 11,326 93,659
------------------------------------- -------- -------- ---------- --------- --------- --------
Change in accounting policy - IFRS
9 - - - - (891) (891)
------------------------------------- -------- -------- ---------- --------- --------- --------
Change in accounting policy - IFRS
15 - - - - (989) (989)
------------------------------------- -------- -------- ---------- --------- --------- --------
At 1 March 2018 3,144 55,805 (2,701) 26,085 9,446 91,779
------------------------------------- -------- -------- ---------- --------- --------- --------
Loss for the year - - - - (27,365) (27,365)
------------------------------------- -------- -------- ---------- --------- --------- --------
Actuarial gain on employee benefits
schemes - net of tax - - - - 999 999
------------------------------------- -------- -------- ---------- --------- --------- --------
Foreign exchange differences - - - (2,999) - (2,999)
------------------------------------- -------- -------- ---------- --------- --------- --------
Cash flow hedges - net of tax - - - (229) - (229)
------------------------------------- -------- -------- ---------- --------- --------- --------
Total recognised expense in the
year - - - (3,228) (26,366) (29,594)
------------------------------------- -------- -------- ---------- --------- --------- --------
Dividends paid - - - - (4,616) (4,616)
------------------------------------- -------- -------- ---------- --------- --------- --------
Gift to ESOP for purchase of own
shares - - (1,712) - - (1,712)
------------------------------------- -------- -------- ---------- --------- --------- --------
ESOP shares allocated - - 967 - (967) -
------------------------------------- -------- -------- ---------- --------- --------- --------
Share based payments - - - - 2,496 2,496
------------------------------------- -------- -------- ---------- --------- --------- --------
At 28 February 2019 3,144 55,805 (3,446) 22,857 (20,007) 58,353
------------------------------------- -------- -------- ---------- --------- --------- --------
Note 1 - General Information
The financial information set out above does not constitute the
Group's statutory accounts for the years ended 28 February 2019 or
28 February 2018 but is derived from those accounts. Statutory
accounts for 2017 have been delivered to the registrar of
companies, and those for 2018 will be delivered in due course. The
auditor has reported on those accounts; their reports were (i)
unqualified; (ii) did not include a reference to any matters to
which the auditor drew attention by way of emphasis without
qualifying their report; and (iii) did not contain a statement
under section 498 (2) or (3) of the Companies Act 2006.
Note 2 - Accounting Policies
Whilst the financial information included in this preliminary
announcement has been prepared in accordance with International
Financial Reporting Standards (IFRSs) and IFRIC interpretations
adopted for use in the European Union, this announcement does not
itself contain sufficient information to comply with IFRSs. The
Group expects to distribute full accounts that comply with IFRSs
and IFRIC interpretations as adopted by the European Union and in
accordance with the Companies Act 2006.
IFRS 9 "Financial Instruments" and IFRS 15 "Revenue from
Contracts with Customers" became effective for accounting periods
commencing on or after 1 January 2018. The Group adopted these
standards with effect from 1 March 2018.
IFRS 9 addresses the classification, measurement and recognition
of financial assets and liabilities. IFRS 9 retains and establishes
three primary measurement categories for financial assets:
amortised cost, fair value through OCI and fair value through
P&L. The basis of the classification depends on the business
model and the contractual cash flow characteristics of the
financial asset. A revised expected credit loss model replaces the
incurred loss impairment model used in IAS 39. In accordance with
the transition provisions in IFRS 9, comparative figures have not
been restated. An opening retained earnings adjustment of GBP1.1m
was recognised, there were no other impacts on the Group's
financial statements.
IFRS 15 deals with revenue recognition and establishes
principles for reporting useful information to users of financial
statements about the nature, amount, timing and uncertainty of
revenue and cash flows arising from an entity's contracts with
customers. The Group has applied IFRS 15
from its effective date and in accordance with the transitional
provisions in IFRS 15, and opening retained earnings adjustment of
GBP1.1 million was recognised. Comparative figures have not been
restated.
Note 3 - Segmental Results
Revenue Underlying profit
-------------------- --------------------
2019 2018 2019 2018
GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------ --------- --------- --------- ---------
Shipbroking 75,691 61,846 9,332 7,742
------------------------------------------------ --------- --------- --------- ---------
Financial 6,951 3,747 2,128 1,785
------------------------------------------------ --------- --------- --------- ---------
Logistics 32,065 33,237 841 777
------------------------------------------------ --------- --------- --------- ---------
Engineering 3,146 4,213 (311) (127)
------------------------------------------------ --------- --------- --------- ---------
Trading segments revenue/results 117,853 103,043 11,990 10,177
------------------------------------------------ --------- --------- --------- ---------
Central costs (2,924) (2,855)
------------------------------------------------ --------- --------- --------- ---------
Underlying operating profit 9,066 7,322
------------------------------------------------ --------- --------- --------- ---------
Specific items included in operating
profit (11,719) (9,067)
------------------------------------------------ --------- --------- --------- ---------
Operating loss (2,653) (1,745)
------------------------------------------------ --------- --------- --------- ---------
Gain on revaluation of investment 500 -
------------------------------------------------ --------- --------- --------- ---------
Finance expense - net (987) (643)
------------------------------------------------ --------- --------- --------- ---------
(Loss)/profit before taxation (3,140) (2,388)
------------------------------------------------ --------- --------- --------- ---------
Taxation (1,525) (474)
------------------------------------------------ --------- --------- --------- ---------
(Loss)/profit for the year from continuing
operations (4,665) (2,862)
------------------------------------------------ --------- --------- --------- ---------
Loss for the year from discontinued operations (22,700) (32)
------------------------------------------------ --------- --------- --------- ---------
Loss for the year (27,365) (2,894)
------------------------------------------------ --------- --------- --------- ---------
2019 Shipbroking Financial Logistics Engineering Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------- ------------ ---------- ---------- ------------ ---------
Capital additions 569 47 567 34 1,216
------------------------------------- ------------ ---------- ---------- ------------ ---------
Depreciation of property, plant and
equipment and amortisation of
computer software 731 1,031 173 145 2,080
------------------------------------- ------------ ---------- ---------- ------------ ---------
Segment operating assets 44,820 37,535 30,503 1,733 114,591
------------------------------------- ------------ ---------- ---------- ------------ ---------
Segment operating liabilities (24,888) (32,802) (25,463) (664) (83,817)
------------------------------------- ------------ ---------- ---------- ------------ ---------
Shipbroking Financial Logistics Technical Total
2018 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------- ------------ ---------- ---------- ---------- ---------
Capital additions 197 - 126 672 995
----------------------------------------- ------------ ---------- ---------- ---------- ---------
Depreciation of property, plant and
equipment and amortisation of computer
software 944 2 173 628 1,747
----------------------------------------- ------------ ---------- ---------- ---------- ---------
Segment operating assets 74,913 14,206 14,538 26,269 129,926
----------------------------------------- ------------ ---------- ---------- ---------- ---------
Segment operating liabilities (15,393) (1,474) (24,220) (3,042) (44,129)
----------------------------------------- ------------ ---------- ---------- ---------- ---------
Note 4 - Specific Items
The following is a summary of Specific items incurred. Each item
has a material impact on the reported results for the year and is
not expected to be incurred on an ongoing basis and as such will
not form part of the underlying profit in future years.
2019 2018
GBP'000 GBP'000
--------------------------------------------------------- --------- ---------
Acquisition-related items
--------------------------------------------------------- --------- ---------
Amortisation charge of intangible assets (1,097) (2,378)
--------------------------------------------------------- --------- ---------
Acquisition-related expenditure
--------------------------------------------------------- --------- ---------
* Acquisition of ACM Shipping Group plc (123) (608)
--------------------------------------------------------- --------- ---------
* Acquisition of NAVES Corporate Finance GmbH (8,045) (5,071)
--------------------------------------------------------- --------- ---------
* Acquisition of Atlantic Brokers Holdings Limited (2,485) (594)
--------------------------------------------------------- --------- ---------
* Other acquisition-related costs - (78)
--------------------------------------------------------- --------- ---------
(10,653) (6,351)
--------------------------------------------------------- --------- ---------
Disposal-related items
--------------------------------------------------------- --------- ---------
* Other disposal-related expenditure - 25
--------------------------------------------------------- --------- ---------
Acquisition and disposal-related items (11,750) (8,754)
--------------------------------------------------------- --------- ---------
Board changes net of tax (615) -
--------------------------------------------------------- --------- ---------
Gain on revaluation of investment 500 -
--------------------------------------------------------- --------- ---------
Loss from discontinued operations (Note 9) (22,700) (32)
--------------------------------------------------------- --------- ---------
Total (34,565) (8,736)
--------------------------------------------------------- --------- ---------
The Group has charged amortisation of GBP1.1 million in the year
(2018: GBP2.4 million) in relation to Intangible assets recognised
as part of a Business Combination under IFRS 3.
Acquisition related expenditure included GBP0.1 million
(GBP2018: GBP0.6 million) incurred in relation to the restricted
share plan implemented to retain key staff following the merger
between Braemar Shipping Services plc and ACM Shipping plc.
The Group incurred expenditure of GBP8.0 million (2018: GBP5.1
million) directly linked to the acquisition of NAVES Corporate
Finance GmbH. This includes GBP0.8 million of interest and GBP7.2
million of post-acquisition remuneration payable to certain vendors
under the terms of the acquisition agreement. This agreement has a
three year earn out period over which the costs of the acquisition
will be charged to the income statement depending on the earnings
of the Finance Division during that period.
The Group incurred expenditure of GBP2.5 million (2018: GBP0.6m)
directly linked to the acquisition of Atlantic Brokers Holdings
Limited in respect of incentive payments to working sellers. The
cash payment was made in the year to 28 February 2018 but is
subject to clawback provisions if the working sellers were to leave
employment of the Group and as such the costs are charged to the
income statement over that claw back period.
The previous Finance Director left the Board in June 2018 and
GBP0.8 million of costs were incurred relating to her departure,
the provision of an interim replacement and the recruitment of a
permanent replacement. The net impact on the reported results was
GBP0.6m after tax adjustments. This is a not a cost that will be
incurred a regular basis and is therefore treated as a specific
item.
The gain on revaluation of investments of GBP0.5 million relates
to the Group's revaluation of its investment in the London Tanker
Broker Panel. Transactions involving this investment are infrequent
but did occur in the last year and therefore the increase in value
was readily identifiable. This is not expected to happen on a
regular basis and therefore this has been treated as a one off
event.
5 Discontinued operations
During the year, the Board resolved to enter into a strategic
relationship with Aqualis Offshore ASA ('Aqualis'). The transaction
will involve the divestment of the Offshore, Marine and Adjusting
product lines in return for a significant minority shareholding in
Aqualis. Once completed Braemar will own 26% of the Aqualis equity
as well as warrants that if successfully vested will take the
overall equity ownership up to 33%. As a consequence of this
transaction, the results of this business unit are presented as a
discontinued operation and prior year comparatives have been
adjusted accordingly.
Aqualis is a Norwegian quoted entity listed on the Oslo Bors and
the Group have estimated the value of the equity consideration
using their share price. The warrants are based on two sets of
profitability targets over the two years to 31 March 2021 such that
one half of the warrants will be measured against the enlarged
Aqualis Group EBITDA and one half against the gross profit of the
former Braemar Marine and Adjusting Divisions. We have estimated
the number of warrants that will vest using a forecast put together
by the joint management team of the combined business. The
resultant valuation is GBP5.4m for the equity and GBP1.0m for the
warrants, from which we have deducted estimated transaction fees of
GBP1.7m leaving net expected proceeds of GBP4.7m.
The old Braemar Technical Division legal entities are undergoing
a reorganisation prior to completion of the transaction as there
are assets and liabilities of other divisions intertwined with the
assets and liabilities being sold in certain locations. The assets
and liabilities classified as held for sale as set out below
therefore includes certain assets, liabilities and cash that will
be transferred out of those legal entities prior to completion. In
order to estimate the loss made on the disposal transaction we have
therefore estimated the value of assets and cash that will be
ultimately retained by Braemar. The result is that the combination
of net proceeds to be received and net assets and cash to be
retained gives a total value of GBP7.8m for the net assets held for
sale and an impairment charge has been made to bring balance sheet
net asset value in to one with this as can be seen below.
At 28 February 2018 certain assets and liabilities belonging to
the Braemar Response division were similarly classified as held for
sale and were subsequently divested by the group in October 2018.
The comparative figures set out below relate to those Braemar
Response assets and liabilities. The loss reported on that disposal
are also included in the Income Statement as part of the
discontinued operations.
The major classes of assets and liabilities comprising the
operations classified as held for sale are as follows:
2019 2018
GBP'000 GBP'000
--------------------------------------------------- --------- ---------
Property, plant and equipment 1,177 37
--------------------------------------------------- --------- ---------
Deferred tax assets - 25
--------------------------------------------------- --------- ---------
Trade and other receivables 18,194 2,550
--------------------------------------------------- --------- ---------
Current tax receivable (group relief surrendered) 375 109
--------------------------------------------------- --------- ---------
Cash and cash equivalents 3,910 144
--------------------------------------------------- --------- ---------
Provison against assets held for sale (13,045) -
--------------------------------------------------- --------- ---------
Trade and other payables (2,797) (766)
--------------------------------------------------- --------- ---------
Net assets of discontinued operations 7,814 2,099
--------------------------------------------------- --------- ---------
The results of the discontinued operation, which have been
included in the income statement, were as follows:
2019 2018
GBP'000 GBP'000
---------------------------- --------- ---------
Revenue 32,276 34,262
---------------------------- --------- ---------
Costs (34,465) (33,984)
---------------------------- --------- ---------
Specific items (20,616) -
---------------------------- --------- ---------
Loss before taxation (22,805) 278
---------------------------- --------- ---------
Taxation 105 (310)
---------------------------- --------- ---------
(Loss)/profit for the year (22,700) (32)
---------------------------- --------- ---------
The loss for the year in respect of discontinued operations
included GBP21.3 million (2018: profit of GBP0.5 million) in
respect of the Offshore, Marine and Adjusting product lines and
GBP1.4 million (2018: loss of GBP0.5 million) in respect of Braemar
Response.
The basic and diluted earnings per share in respect of
discontinued operations is (73.52) pence (2018: (0.11) pence)
The weighted average number of shares used in basic earnings per
share is 30,876,631 (2018: 29,854,554). The weighted average number
of shares used in the diluted earnings per share is 33,700,210
(2018: 32,354,524) after adjusting for the effect of 2,823,579
(2018: 2,499,970) dilutive share options. As any potential ordinary
shares would have the effect of decreasing a loss per share for the
year they have not been treated as dilutive.
During the year, the discontinued operations had net operating
cash outflows of <GBP0.8 million. There were no cash flows
relating to investing or financing activities in the period.
Note 6 - Dividend
The Directors are proposing a final dividend in respect of the
financial year ended 28 February 2019 of 10 pence per share which
will absorb an estimated GBP3.0 million of shareholders' funds. It
will be paid on 26 July 2019 to shareholders who are on the
register of members on 21 June 2019.
Note 7 - Earnings per share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average
number of ordinary shares outstanding during the year, excluding
768,991 ordinary shares held by the Employee Share Ownership Plan
(2018: 435,338 shares) which are treated as cancelled.
For diluted earnings per share, the weighted average number of
ordinary shares in issue is adjusted to assume conversion of all
dilutive ordinary shares. The Group has one class of dilutive
ordinary shares being those options granted to employees where the
exercise price is less than the average market price of the
Company's ordinary shares during the year. The Group has other
potential dilutive ordinary shares, including convertible loan
notes, however these are not currently dilutive.
Total operations 2019 2018
GBP'000 GBP'000
------------------------------------------------ --------- ---------
Loss for the year attributable to shareholders (27,365) (2,894)
------------------------------------------------ --------- ---------
pence pence
---------------------------------- -------- -------
Basic earnings per share (88.63) (9.70)
---------------------------------- -------- -------
Effect of dilutive share options - -
---------------------------------- -------- -------
Diluted earnings per share (88.63) (9.70)
---------------------------------- -------- -------
As any potential ordinary shares would have the effect of
decreasing a loss per share for the year they have not been treated
as dilutive.
Underlying operations 2019 2018
GBP'000 GBP'000
------------------------------------------------------ --------- ---------
Underlying profit from continuing operations for the
year attributable to shareholders 7,200 5,842
------------------------------------------------------ --------- ---------
pence pence
------------------------------------------------------ --------- ---------
Basic earnings per share 23.32 19.57
------------------------------------------------------ --------- ---------
Effect of dilutive share options (1.96) (1.51)
------------------------------------------------------ --------- ---------
Diluted earnings per share 21.36 18.06
------------------------------------------------------ --------- ---------
The weighted average number of shares used in basic earnings per
share is 30,876,631 (2018: 29,854,554).
The weighted average number of shares used in the diluted
earnings per share is 33,700,210 (2018: 32,354,524) after adjusting
for the effect of 2,823,579 (2018: 2,499,970) dilutive share
options. As any potential ordinary shares would have the effect of
decreasing a loss per share for the year they have not been treated
as dilutive.
Note 8 - Reconciliation of operating profit to net cash flow
from operating activities
Group
--------------------
2019 2018
GBP'000 GBP'000
------------------------------------------------------------- --------- ---------
Loss/(profit) before tax for the year from
continuing operations (3,140) (2,388)
------------------------------------------------------------- --------- ---------
Loss before tax for the year from discontinued
operations (22,700) 279
------------------------------------------------------------- --------- ---------
Adjustments for:
------------------------------------------------------------- --------- ---------
* Depreciation of property, plant and equipment
(continuing) 691 1,165
------------------------------------------------------------- --------- ---------
* Depreciation of property, plant and equipment
(discontinuing) 145 39
------------------------------------------------------------- --------- ---------
* Amortisation of computer software 478 583
------------------------------------------------------------- --------- ---------
1,055 -
* Impairment of computer software
------------------------------------------------------------- --------- ---------
Specific items:
------------------------------------------------------------- --------- ---------
- Impairment of assets held for sale 13,045 -
------------------------------------------------------------- --------- ---------
(100) -
* Gain on disposal of investment
------------------------------------------------------------- --------- ---------
* Amortisation of other intangible assets 1,073 2,378
------------------------------------------------------------- --------- ---------
* Other specific items 10,935 6,689
------------------------------------------------------------- --------- ---------
* Finance income (297) (95)
------------------------------------------------------------- --------- ---------
* Finance expense 1,555 713
------------------------------------------------------------- --------- ---------
* Share-based payments (excluding restricted share
plan) 1,282 1,131
------------------------------------------------------------- --------- ---------
* Net foreign exchange gains and financial instruments 229 (809)
------------------------------------------------------------- --------- ---------
Changes in working capital:
------------------------------------------------------------- --------- ---------
* Trade and other receivables (56) 3,936
------------------------------------------------------------- --------- ---------
* Trade and other payables 5,456 (3,628)
------------------------------------------------------------- --------- ---------
Contribution to defined benefit pension scheme (450) (450)
------------------------------------------------------------- --------- ---------
Provisions (330) (310)
------------------------------------------------------------- --------- ---------
Cash generated from operations before acquisition
and disposal related activities 8,871 9,233
------------------------------------------------------------- --------- ---------
Acquisition fees paid - (2,870)
------------------------------------------------------------- --------- ---------
Amounts due to acquisition related retention
payments - (2,980)
------------------------------------------------------------- --------- ---------
Cash generated from operations after acquisition
and disposal related activities 8,871 3,383
------------------------------------------------------------- --------- ---------
Note 9 - Dividend timetable
Ex-dividend date for
2018/19 final dividend: 20 June 2019
2018/19 Final dividend
record date: 21 June 2019
2018/19 Last date for
DRIP elections 5 July 2019
2018/19 Final dividend
payment date: 26 July 2019
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR EBLBLKEFLBBK
(END) Dow Jones Newswires
May 20, 2019 02:00 ET (06:00 GMT)
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