RNS Number:0962Q
Reed Health Group PLC
24 September 2003
24 September 2003
Reed Health Group plc
("Reed Health", "the Company" or "the Group")
Preliminary Results for the year ended 30 June 2003
Reed Health Group plc, the provider of staffing services in the Health, Social
Care and Education sectors in the UK, announces preliminary results for the year
ended 30 June 2003.
2003 2002 Increase
Turnover #116.15m #78.35m 48%
Operating profit #5.84m #4.89m 19%
Profit before tax #5.57m #4.94m 13%
Earnings per share pre-exceptional
items and goodwill amortisation 8.89p 7.89p 13%
Dividend - final 1.62p 1.34p 21%
- total 2.35p 2.00p 17.5%
* First full year's contribution from The Locum Group; integration continuing
* National Framework Agreements entered into
* approved in October 2002 for locum doctors for hospitals
* approved in August 2003 for allied health professions
* Negotiating with Mercury Health, a subsidiary of Tribal Group plc, to
provide staffing for a Treatment Centre chain
* Nursing has been approved for five NHS Regional Agency Projects; 8 new
branches to be opened
* Closer co-operation between Medical branches resulting in increased
organic growth and improved service
* Encouraging performance in Social Care despite tough competition;
strengthened management team; up to 8 new branches to be opened
* Appointment today of Barry Hartop as Non-Executive Chairman; Lord Tom
Sawyer to remain on the Board as a Non-Executive Director
* Full year dividend of 2.35p per share (2002: 2.00p)
Commenting on the outlook for the current year, Barry Hartop, Chairman, said:
"During the current year, we will be focusing on maintaining our position of
strength in our markets and anticipate trading to be in line with our
expectations. We believe our chosen markets will continue to offer abundant
opportunities and therefore view the future with confidence. During the first
half of the current financial year, we are anticipating a lag between the
spending required to support our continued organic growth and the expected
increased trading which will result from this spending. This will impact on our
business and its results during the first half of the current year but will have
a positive impact during the second half."
- Ends -
For further information, please contact:
Reed Health Group plc 020 7834 3181
David Fennell, Chief Executive
Mark Garratt, Finance Director
Weber Shandwick Square Mile 020 7067 0700
Louise Robson, Susanne Walker or Cass Helstrip
24 September 2003
Reed Health Group plc
("Reed Health", "the Company" or "the Group")
Preliminary Results for the year ended 30 June 2003
Chairman's Statement
I am pleased to report on the results of Reed Health Group plc for the year to
30 June 2003. This is our second year as an independent quoted company and a
year which has proved to be interesting and challenging, both for the Group and
for the markets in which we operate. As outlined in June, we have been seeing
increasing competition across all areas in which we operate but particularly in
care, education and physiotherapy. However, we have seen an improvement in
demand in our Social Care division since the year-end and expect this to
continue for the foreseeable future.
People
I am delighted to accept the position of Chairman of Reed Health Group plc. The
Group's activities are already familiar to me, having previously been Chairman
of Locum Group Ltd, working with David Fennell and his team from 1997 until
2002, when the Group was acquired by Reed Health.
I am also very pleased that Lord Sawyer, who has served as Chairman since Reed
Health was de-merged from Reed Executive in July 2001, has agreed to continue to
serve as a Non-Executive Director. In Lord Sawyer, we have a true champion of
best practice in human resources, recognising that it is our employees who give
us the edge over our competitors.
On behalf of the Company, I would like to thank Lord Sawyer for remaining as
Chairman during the period of considerable management change, through to the
present, settled and enhanced position.
In line with our growth strategy, we have strengthened our Senior Management
team with the appointments, in April, of Phil McDonald as Divisional Director
for Reed Nurse and, in May, Christopher Rolland as Business Development
Director.
On behalf of the Board, I would like to thank all our employees for their
tenacity, robust loyalty and enterprise throughout the past year.
Strategy
As well as becoming a leading provider of professional and specialist staff care
in health, care and education for the health service and local authorities, Reed
Health Group's strategy is to grow organically, as we respond to the increasing
need for professionally skilled staff. To assist with our strategy, we will be
representing new professions and opening branches in areas where new markets are
emerging.
While our clients will remain predominantly UK based we are able to source
candidates from around the world and are able to offer an increasing number of
opportunities in other countries.
Financials
For the year to 30 June 2003, turnover was #116.2 million (2002: #78.3 million),
an increase of 48%. Operating profit was up 19% to #5.8 million (2002: # 4.9
million) and pre-tax profit was #5.6 million (2002: #4.9 million), up 13%.
Adjusted earnings per share grew 13% to 8.89p (2002: 7.89p). Our net debt
position at the 30 June 2003 is greatly improved on last year at #2.7 million
(2002: #6.9 million).
Further details of our financial performance are given in the Finance Director's
Report.
Dividend
I am pleased to announce that the Board is recommending a final dividend of
1.62p (2002: 1.34p), an increase of 21%. This will be payable on 1 December 2003
to shareholders on the register on 31 October 2003.
Outlook
The Board believes the Group is working well together, as the different cultures
have blended, creating a dynamic team with a confident approach to the year
ahead.
Since the year end our Social Care, Medical and Nurse divisions have made
further progress. The Social Care division has good opportunities to grow
through branch expansion. Whilst its markets remain difficult, our Health
Professions division is well placed to benefit from the recent awards of
Diagnostic Centre contracts to the private sector.
During the current year, we will be focusing on maintaining our position of
strength in our markets and anticipate trading to be in line with our
expectations. We believe our chosen markets will continue to offer abundant
opportunities and therefore view the future with confidence. During the first
half of the current financial year, we are anticipating a lag between the
spending required to support our continued organic growth and the expected
increased trading which will result from this spending. This will impact on our
business and its results during the first half of the current year but will have
a positive impact during the second half.
Barry Hartop
Chairman
CHIEF EXECUTIVE'S REVIEW
With sales of #116.2 million, up 48% and operating profit of #5.8 million, up
19%, the combined strength of Reed Health Group's and Locum Group's trading has
helped achieve a significant step up in our presence in each of our markets.
However, the performance varied between divisions, as detailed below.
The year to 30 June 2003 has been characterised by three features:
* Externally, the challenges presented by the increase of tendering and
greater competitor activity.
* Internally, the opportunities presented by the integration of Locum
Group with Reed Health Group, with allied management changes.
* Strategically, the determination to build on our core strengths and grow
the business with new appointments.
Strategy
The Group's aim is to become the leading provider of professional and specialist
recruitment in the Health, Social Care and Education professions. We will
concentrate on being the best agency for both candidates and clients.
We will invest in our existing business, to achieve a high rate of organic
growth. The Group's growth is dependent on investing in a premium service and
professional sales people, supported by good human resources.
We are always on the alert for new opportunities in public sector services,
through Framework Agreements, direct contracts with Trusts and Councils, or PPP
type arrangements.
We have recently carried out research into our branding, particularly the use of
the Reed name. The research has confirmed that the Reed name gives us a strong
advantage as a brand and we will therefore retain Reed Health Group plc as the
Company's name. Our divisions will be Reed Health, Reed Doctor, Reed Nurse and
Reed Social Care, a uniting theme in our branding. Under our licence we are
unable to use the Reed name for education and are returning to the former brand
of Teachers UK.
Our Markets
Reed Health operates almost entirely within the UK public sector. Approximately
two thirds of our business is with the NHS, which comprises our Nursing, Medical
and Allied Health Professions businesses, whilst the remaining third is with
local authorities and is undertaken by our Social Care and Education divisions.
There have been two developments in our market place, which are presenting
opportunities for the Group.
The National Framework Agreements, which give NHS Trusts a list of approved
suppliers, are bringing opportunities to both the Medical and Allied Health
Professions divisions. The Group was approved for both the October 2002 National
Framework Agreement, incorporating locum doctors for hospitals and the August
2003 Agreement covering allied health professions. We are using these framework
contracts to develop business with more NHS Trusts than ever before.
NHS Professionals is emerging as a bank operator in eight regions. We have been
asked to act as a secondary supplier to them. Should NHS Professionals accept
only those suppliers of temporary staff which measure up to the exacting
standards maintained by Reed Health, we believe the Health Service would greatly
benefit.
REVIEW OF OPERATIONS
The key focus of this year has been to merge the two operations to create a
strong business for the future.
Allied Health Professions
Turnover grew to #39.8 million. In May, the Allied Health Professions division
was formed by combining Reed Health Professionals branches with Locum Group
Health under one Divisional Director. We now have a strong central team with the
advantage of regional representation. 27 tenders were submitted in the past year
and we are particularly pleased that we have achieved an 80% award rate. In
addition, nine proposals for Preferred Provider status have been accepted.
Unusual variations in demand have been felt across the industry, with some
professions such as radiography picking up, but others, such as physiotherapy,
experiencing reduced demand. Trading is expected to remain below prior years
during the first half and attention will focus on reducing overheads and raising
productivity, to maintain the divisional contribution.
Medical
During the year, turnover in the Medical division grew strongly to #14.4
million. Developments in this division included the expansion of our Glasgow
office and the opening of a new branch in Cardiff. This expansion, combined with
closer co-operation between branches, has enabled us not only to boost organic
growth but also to improve our service to candidates and clients throughout the
UK. Year-on-year growth is expected to remain strong in the first half of the
financial year.
Nursing
Turnover was #23.1 million. The division's original focus on lower-margin nurse
bank contracts left it vulnerable to NHS Professionals. The division is being
comprehensively rebuilt with a new management team and a UK-wide growth
strategy. Having made these changes the sales volumes are increasing again,
though the impact of the new branch opening programme will not be seen until
later in the year.
The second phase of the London Agency Project came into effect in the Spring and
so far has had a neutral effect on volumes and margins.
Five NHS regions issued invitations to tender for the supply of agency nurses.
Reed Nurse has been approved to supply in all the regions tendered. We are in
the process of opening eight new branches to service this.
Our contracts with Central and North-West London and Barnet and Chase Farm are
performing well. During the year we were awarded a contract with the Royal Free
Hospital, Hampstead, which has been operating successfully since May.
Social Care
Reed Social Care's turnover was #34.1 million. The division delivered an
encouraging performance despite tough competition. In London, new branches in
Stratford and Lewisham helped generate more business from existing contracts. We
have strengthened our management team in readiness for a further programme of
branch openings.
The increases in charge rates, which were implemented in the Autumn of 2002,
were introduced at a time when the division was without an Operations Director
and this had a negative impact on volumes in the second half. In response to
this and the competitive threats experienced earlier in the year, the senior
management team has been strengthened, with new branch, regional and business
development appointments now in place. The new found momentum will continue into
the next twelve months, with up to eight new branches planned. As a result
operating costs will increase in the first half of the next financial year,
ahead of the expected growth in sales in the second half.
We face the year ahead with a strong team that is responding well to the
challenge of increased competition.
Education
Turnover was #4.8 million. Education remains a small part of our business, with
branches in Ilford, Hertfordshire, Birmingham and Leeds. The market for teachers
has been severely impacted by spending constraints on schools. This is a
situation which we do not expect to continue indefinitely, if class sizes are
not to increase. We expect the market to remain depressed in the first half of
the financial year but hope for an upturn in funding towards the end of the
academic year which will improve opportunities for the Group. During the year,
we worked hard to generate a good supply of teachers. More than 90% of the
qualified teachers we place come from Australia and Canada.
International
Outside the UK, our operations exist to source candidates for the UK market. In
Australia, we have started to develop business in the health professions, such
as physiotherapy, speech therapy, occupational therapy, radiography and
pharmacy. Candidates are mostly qualified British and Irish nationals who are
travelling and keeping themselves solvent by offering their availability for
temporary cover. Temporary work in other countries benefits the professions,
because it spreads international best practice more widely and helps to broaden
the skill sets of both the candidate and the team into which they are placed.
New Opportunities
A complementary business to Social Care is Social Housing. Reed Social Housing
was launched in May 2003 to supply a wide range of staff to this sector. It is
an organic project, with development costs written off in the current year.
Corporate business development activity has taken us into some interesting new
markets. Reed Health supported AON's successful bid to the Department of Trade
and Industry for further medical assessments for former coal miners affected by
"vibration white finger", an industrial disease caused by prolonged use of
pneumatic drills. The Group supplied the doctors to conduct the assessments.
The Diagnostic and Treatment Centres ("DTCs") programme was launched with the
aim of tackling the NHS "waiting lists", to get the private sector to build,
staff and run some 200 DTCs for a steady volume of routine, non-emergency,
operations.
The DTC staff must be professionally registered to UK standards, and they should
not be taken out of NHS hospitals. This presents an opportunity for Reed Health,
thanks to our ability to recruit from outside the UK.
We supported Mercury Health in their tender to the Department of Health.
Following Mercury Health's selection as a preferred bidder for 10 of the first
22 locations announced we are now entering more detailed negotiations.
Human Resources
Good Human Resources management was one of the key factors behind five years of
strong organic growth at Locum Group. We have to be prepared for the growing
complexity of legislation and we also believe in training for higher
productivity. To reflect the position of our staff as one of our "stakeholders",
we strive to maintain harmonious employee relations.
Another stakeholder group comprises our candidates, whose interests we aim to
serve better than any of our competitors. This has led us to establish a vision
of Reed Health as "People Developers", by which we mean that we invest in the
careers of our candidates, as well as our staff. Our candidates are offered a
wide range of courses, including Continuing Professional Development, which we
run in-house. Candidates nowadays can pursue careers with Reed Health Group in
more than one country, gaining and sharing in skills and confidence.
For Reed Health Group, Corporate Social Responsibility means recognising the
human and social impact of our activities. We believe that as a responsible
agent of introduction, the market for staff can be harnessed to the benefit of
our candidates, their chosen professions and the communities where they are
placed.
David Fennell
Chief Executive
FINANCE DIRECTOR'S REVIEW
I am pleased to present my first report on Reed Health Group plc for what has
been a year of change, integration and consolidation.
Turnover
Turnover for the Group increased by 48% to #116.2 million (2002: #78.3 million).
Gross Profit
Gross profit increased by 75% to #26.6 million (2002: #15.2 million) and gross
margin as a percentage of sales increased to 23% (2002: 19%).
Operating profit and margin
Administrative expenses before goodwill amortisation and exceptional costs
increased by 87% to #18.7 million (2002: #10.0 million). Of the #8.7 million
increase, #7.7 million is attributable to The Locum Group, the remainder
represents the continued necessary build up in the Company's infrastructure
following its de-merger from Reed Executive PLC.
The Group's operating profit before goodwill amortisation and the exceptional
item increased by 52% to #7.9 million (2002: #5.2 million), representing a net
operating margin of 6.8% (2002: 6.6%).
Exceptional charge
The exceptional item of #460,000 relates to costs arising from the outcome of
the Annual General Meeting in November 2002, and the subsequent departure of the
then Chief Executive and Group Finance Director.
Pre-tax profit
Profit before tax, goodwill amortisation and exceptional items amounted to #7.6
million up 45% on last year's #5.2 million.
Taxation
The tax charge for the year was #2.3 million giving an effective rate of 41.4%.
The effective tax rate on profits, before goodwill amortisation and exceptional
items, was 30%.
Earnings per share
Adjusted earnings per share, before exceptional items and goodwill amortisation,
were 8.89p (2002: 7.89p) an increase of 13%. Adjusted earnings per share, on a
fully diluted basis but before exceptional items and goodwill amortisation were
8.88p (2002: 7.84p), an increase of 13%. Earnings per share on the FRS 14 basis
were 5.47p (2002: 7.27p) due to the significant goodwill charge.
Dividend
The Board has proposed a final dividend of 1.62p per share, which together with
the interim dividend of 0.73p brings the total dividend for the year to 2.35p
(2002: 2.00p). This represents a yield of 2.8% (2002: 1.4%) on the 30 June 2003
share price of 84p and a dividend cover (pre exceptional items and goodwill
amortisation) of 3.78 times (2002: 3.33 times). The dividend is payable on 1
December 2003 to shareholders on the register as at 31 October 2003.
Cashflow
Cashflow from operations amounted to #8.8 million (2002: #7.2 million). This
increase was achieved through a combination of increased profitability and
better working capital management. Capital expenditure for the year amounted to
#562,000 and consisted of investment in computer systems hardware and software
to support the business. Dividends, interest, and corporation tax amounted to a
net payment of #4.1 million.
Equity shareholders' funds
Equity shareholders' funds increased from #31.5 million in 2002 to #33.4 million
in 2003 reflecting retained earnings of #1.9 million after dividends of #1.4
million.
Treasury
Net debt at the end of the year was #2.7 million (2002: #6.9 million) giving a
modest gearing of 8% (2002: 21.8%).
Derivatives and other financial instruments
The Group's financial instruments comprise borrowings, cash and various items
such as trade debtors and creditors that arise directly from its operations. The
main purpose of these instruments is to raise finance for operations. The Group
has not entered into derivatives transactions nor does it trade in financial
instruments as a matter of policy. The main risks arising from the Group's
financial instruments are interest rate risk and liquidity risk.
Operations are financed through a mixture of retained profits and bank
borrowings. The Board's policy is to use variable rate borrowings.
Interest rates remain broadly unchanged and possible short-term variations in
the rates should not significantly impact the cost of debt to the Group.
The Group's exposure to foreign currency risk remains low due to the relative
size of the overseas operations.
Mark Garratt
Group Finance Director
- Ends -
For further information, please contact:
Reed Health Group plc 020 7834 3181
David Fennell, Chief Executive
Mark Garratt, Finance Director
Weber Shandwick Square Mile 020 7067 0700
Louise Robson, Susanne Walker or Cass Helstrip
Consolidated Profit and Loss Account
for the year ended 30 June 2003
2003 2002
#'000 #'000
Turnover - continuing activities 116,153 78,345
Cost of sales (89,601) (63,180)
----------- ----------
Gross profit 26,552 15,165
Administrative expenses (20,712) (10,274)
----------- ----------
Operating profit before goodwill amortisation and
exceptional items 7,876 5,179
Goodwill amortisation (1,576) (132)
Exceptional items (460) (156)
----------- ----------
Group operating profit - continuing activities 5,840 4,891
----------- ----------
Net interest (payable)/receivable and similar charges (272) 48
----------- ----------
Profit on ordinary activities before taxation 5,568 4,939
Tax on profit on ordinary activities (2,304) (1,588)
----------- ----------
Profit for the financial year 3,264 3,351
Dividends (1,401) (1,094)
----------- ----------
Retained profit for the year 1,863 2,257
----------- ----------
Earnings per share p p
Basic 5.47 7.27
Diluted 5.47 7.22
Adjusted earnings per share before goodwill
amortisation and exceptional items
Basic 8.89 7.89
Diluted 8.88 7.84
Dividends per share 2.35 2.00
There were no recognised gains and losses other than those noted in the
consolidated profit and loss account. There were no differences between
historical cost profit and losses and the figures noted in the consolidated
profit and loss account.
Consolidated Balance Sheet
at 30 June 2003
2003 2002
#'000 #'000
Fixed assets
Intangible assets 30,048 31,437
Tangible assets 953 1,075
---------- ---------
31,001 32,512
Current assets
Debtors due within one year 16,026 19,702
Cash at bank and in hand 223 1,139
---------- ---------
16,249 20,841
Creditors: Amounts falling due within one year (13,864) (19,692)
---------- ---------
Net current assets 2,385 1,149
---------- ---------
Total assets less current liabilities 33,386 33,661
Creditors: Amounts falling due after more than one year - (2,131)
Provisions for liabilities and charges (12) (12)
---------- ---------
Net assets 33,374 31,518
---------- ---------
Capital and reserves
Called up share capital 1,193 1,193
Share premium account 21,478 21,485
Merger reserve 6,317 6,317
Capital redemption reserve 51 51
Profit and loss account 4,335 2,472
---------- ---------
Equity shareholders' funds 33,374 31,518
---------- ---------
The financial statements were approved by the Board on 24 September 2003 and
were signed on its behalf by:
David Fennell Mark Garratt
Chief Executive Officer Group Finance Director
Consolidated Cash Flow Statement
for the year ended 30 June 2003
2003 2002
#'000 #'000
Net cash inflow from operating activities 8,843 7,212
Returns on investment and servicing of finance (272) 48
Taxation paid (2,622) (926)
-------- ---------
5,949 6,334
-------- ---------
Capital expenditure and financial investment
Payments for tangible fixed assets (562) (476)
-------- ---------
Acquisitions and disposals
Purchase of subsidiary undertakings - (34,486)
Cash acquired with subsidiary undertakings - 24
-------- ---------
- (34,462)
-------- ---------
Dividends (1,234) (295)
-------- ---------
Net cash inflow/(outflow) before financing 4,153 (28,899)
-------- ---------
Financing
New bank loans - 9,000
Financing costs paid - (41)
Repayment of bank loans (8,000) (1,000)
Funds advanced under invoice discounting facility 2,938 -
Issue of Ordinary Shares - 22,366
Expenses of share issue (7) (583)
-------- ---------
(5,069) 29,742
-------- ---------
(Decrease)/increase in cash (916) 843
-------- ---------
Notes to the Preliminary Results
30 June 2003
1. SEGMENTAL REPORTING
All Group turnover is derived from the United Kingdom. The Directors consider
all operations to form one class of business.
2. TAXATION
2003 2002
#'000 #'000
United Kingdom Corporation Tax
Current tax on income for the year 2,347 1,591
Adjustments in respect of previous periods (43) -
Deferred taxation, net reversal of timing differences - (3)
Tax on profit on ordinary activities 2,304 1,588
Profit on ordinary activities before taxation 5,568 4,939
Theoretical UK Corporation Tax rate of 30% (2002: 30%) 1,670 1,482
Effects of:
Other expenditure not tax deductible (5) 66
Tax rate adjustments - marginal rate relief (9) -
Capital allowances in excess of depreciation - 3
Trading losses in overseas subsidiaries 218 -
Adjustments in respect of previous periods (43) -
Goodwill amortisation not tax deductible 473 40
-------- ---------
2,304 1,591
======== =========
3. DIVIDENDS
2003 2002
#'000 #'000
Interim dividend paid of 0.73p per share (2002: 0.66p) 435 295
Proposed final dividend of 1.62p per share (2002: 1.34p) 966 799
-------- ---------
Total dividend in year 1,401 1,094
-------- ---------
4. EARNINGS PER SHARE
Basic earnings per share is calculated using the earnings attributable to
ordinary shareholders and the weighted average number of Ordinary Shares in
issue during the year.
Diluted earnings per share is calculated by adjusting the Ordinary Shares in
issue by the potential dilutive effect of share options.
There are no other potentially dilutive categories other than share options.
The basis of the earnings and weighted average number of shares used in the
calculations are set out below:
2003 2002
Weighted Weighted
average average
number number
Earnings of shares EPS Earnings of shares EPS
#'000s thousands pence #'000s thousands pence
FRS14 Basis
Basic
earnings per
share 3,264 59,645 5.47 3,351 46,126 7.27
Dilutive
effect of
options - 52 - - 281 (0.05)
-------- -------- ------ ------- -------- -------
Diluted
earnings per
share 3,264 59,697 5.47 3,351 46,407 7.22
-------- -------- ------ ------- -------- -------
Adjusted to
exclude goodwill
amortisation
and exceptional
items
Basic - FRS14
Basis 3,264 59,645 5.47 3,351 46,126 7.27
Exceptional
item 460 - 0.77 156 - 0.34
Goodwill
amortisation 1,576 - 2.64 132 - 0.28
-------- -------- ------ ------- -------- -------
Adjusted basic
earnings per
share 5,300 59,645 8.89 3,639 46,126 7.89
-------- -------- ------ ------- -------- -------
Diluted - FRS14
Basis 3,264 59,697 5.47 3,351 46,407 7.22
Exceptional
items 460 - 0.77 156 - 0.34
Goodwill
amortisation 1,576 - 2.64 132 - 0.28
-------- -------- ------ ------- -------- -------
5,300 - 8.88 3,639 46,407 7.84
-------- -------- ------ ------- -------- -------
5. RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS
2003 2002
#'000 #'000
Total recognised gains relating to the financial year 3,264 3,351
Dividends (1,401) (1,094)
Net (costs)/proceeds of share issue (7) 21,783
---------- ----------
Increase in shareholders' funds 1,856 24,040
Opening shareholders' funds 31,518 7,478
---------- ----------
Closing shareholders' funds 33,374 31,518
---------- ----------
6. RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING
ACTIVITIES
2003 2002
#'000 #'000
Operating profit 5,840 4,891
Amortisation of goodwill 1,576 132
Depreciation of tangible fixed assets 683 237
Loss on disposal of tangible fixed assets - 7
Working capital movements
Debtors 3,676 (1,068)
Creditors (2,932) 3,013
---------- ----------
Net cash inflow from continuing operating activities 8,843 7,212
---------- ----------
7. RETURNS ON INVESTMENT AND SERVICING OF FINANCE
2003 2002
#'000 #'000
Interest received 10 92
Interest paid (282) (44)
---------- ----------
(272) 48
---------- ----------
8. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
2003 2002
#'000 #'000
(Decrease)/increase in cash (916) 843
New loans - (9,000)
Repayment of loans 8,000 1,000
Funds advanced under invoice discounting facility (2,938) -
---------- ----------
Reduction/(increase) in net (debt)/funds 4,146 (7,157)
Opening net (debt)/funds (6,861) 296
---------- ----------
Closing net debt (2,715) (6,861)
---------- ----------
9. ANALYSIS OF NET DEBT
1 July 30 June
2002 Cash flow 2003
#'000 #'000 #'000
Cash at bank and in hand 1,139 (916) 223
Bank overdraft - - -
---------- --------- ----------
Cash 1,139 (916) 223
Borrowings (8,000) 5,062 (2,938)
---------- --------- ----------
Net debt (6,861) 4,146 (2,715)
---------- --------- ----------
10. ANNUAL REPORT
The Annual Report will be sent to all shareholders in due course and will be
available from the Group's registered office, 7 St George's Square, London SW1V
2HX.
11. PRELIMINARY STATEMENT
This preliminary statement, which has been agreed with the Auditors was approved
by the Board on 23 September 2003. It is not the company's statutory accounts.
Statutory accounts will be sent to shareholders shortly.
The statutory accounts for the year ended 30 June 2002 have been delivered to
the Registrar of Companies and received an audit report which was unqualified
and did not contain statements under s237 (2) or (3) of the Companies Act 1985.
The statutory accounts for the year ended June 2003 have not yet been approved,
audited or filed.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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