RNS Number:3651D
Forest Support Services PLC
06 September 2007
6 September 2007
Forest Support Services Plc ("The Group" or the "Company")
Preliminary results for the year ending 31 March 2007
I am pleased to report a record Group profit of #279,581 before goodwill
amortisation and taxation. This was achieved on a growth in turnover of 31%.
As was reported at the interim stage, the first half outcome resulted from
better than expected trading at Forest Traffic Signals and Forest Highways and
this trend has continued for the full year with both operating subsidiaries
contributing strongly to profits.
Forest Traffic Signals achieved a record profit for the full year. In
particular the depots at Newport and Bristol performed well with trading being
lifted by success in bidding for additional contracts including its first Welsh
Framework contract, for rural and minor roads. The Winchester depot performed
below our expectations, quieter than anticipated trading in the Summer and
Autumn eroding full year profitability.
A new range of services, branded "Forest Access and Security", including site
fencing and traffic barriers, was launched in January, with start-up costs
having a negative impact upon profits for the year. This new service range was
launched at the Newport depot and has been well received by customers.
Forest Highways boosted both revenue and margin during the second half, and made
a strong contribution to Group profits for the full year, with an increasing
proportion of the revenue coming from extended duration, large scale contracts,
improving the visibility and certainty of workload. Actions to re-position the
Forest Highways business continue, with the full year result offering a solid
indication of progress.
Results
The Group earned a record pre-tax profit of #279,581 (before goodwill
amortisation of #83,100). This compares with a profit of #44,720 (before
goodwill amortisation of #83,100) for the equivalent period last year. Profit
after net tax credit of #88,169 (before goodwill amortisation) was #367,750
giving rise to earnings on the weighted average number of shares in issue during
the year of 2.0p per share. The tax credit arises due to the recognition of a
deferred tax asset for losses brought forward now considered to be recoverable
against future taxable profits.
Turnover for the year was #6,230,000 (prior year: #4,760,000), an increase of
31%. The balance sheet continues to strengthen with the Group holding cash at
the year end of #319,000.
Dividend
Your Board is recommending a cash dividend of 0.36p per share (prior year:
0.27p). This payment is an increase of 33% and is covered 4.2 times by
earnings. The dividend will be paid on the 7 December 2007 to shareholders on
the register at close of business on the 16 November 2007.
Business Strategy, Current Trading and Future Prospects
The Board believes that the principal, medium-term objectives of the Group
should be to grow the business and to deepen the resilience of the earnings
stream. The ongoing strategy to develop the Forest brand; launching new
services, building on our strengths and regional position is being pursued.
This is being done primarily via organic growth although this may have a
detrimental effect on profits in the short term it has the potential to create
long-term value.
The Forest Traffic Signals depots at Newport and Bristol began the financial
year trading broadly in line with expectations. The launch of Forest Access and
Security continues as planned at Newport. It is intended to offer this service
range through all existing Forest Traffic Signals depots, providing significant
opportunities for future growth. Forest Access and Security is not expected to
make significant contribution to profits in the current financial year. The
board is encouraged by the improvement in Winchester's trading which has started
the year with improved performance.
Forest Highways began the new financial year trading at a reduced level compared
to the equivalent period last year, with some delays in the start-dates of
secured projects. Framework contracts won in the previous financial year are
expected to firmly underpin revenue during this and future years. Due to the
weaker start to the year the contribution from Forest Highways is expected to be
less than last year.
Forest maintains a strong presence in Newport, South Wales and recent changes in
the Welsh government, coinciding with new contractual arrangements, have caused
delays in start dates. These short term effects were anticipated and will not
detract from the pursuit of the Group's longer term objectives.
Conclusion
The full year outcome provides firm evidence of the progress made in
repositioning the Group. The Board believes that a continuation of the strategy
of organic growth focused on broadening the revenue base of the business, offers
the best method of delivering shareholder value.
I thank the employees and my boardroom colleagues for their continued efforts
and hard work.
CC Powell
Non-executive Chairman
5 September 2007
Profit and Loss Account
For the period ended 31 March 2007
Note 2007 2006
# #
Turnover 6,233,853 4,758,284
Cost of sales (4,273,078) (3,407,302)
Gross profit 1,960,775 1,350,982
Administrative expenses (1,754,359) (1,379,493)
Operating profit / (loss) 206,416 (28,511)
Interest receivable 9,990 9,143
Interest payable and similar (19,925) (19,012)
charges
Profit / (loss) on ordinary 196,481 (38,380)
activities before taxation
Tax on profit / (loss) on 2 88,169 (1,611)
ordinary activities
Profit / (loss) on ordinary 284,650 (39,991)
activities after taxation
Earnings/(loss) per share: 3
Basic 1.5p (0.2)p
Basic excluding goodwill
amortisation 2.0p 0.2p
Diluted 1.5p (0.2)p
Balance Sheet
As at 31 March 2007
2007 2006
Group
Group Company (Restated) Company
# # # #
Fixed assets
Intangible assets 958,683 - 1,041,783 -
Tangible assets 1,027,842 - 915,706 -
Investment in subsidiary - 1,586,892 - 1,586,892
companies
1,986,525 1,586,892 1,957,489 1,586,892
Current assets
Debtors 1,877,111 1,561,833 1,154,402 955,596
Cash at bank and in hand 319,230 189,179 511,711 419,630
2,196,341 1,751,012 1,666,113 1,375,226
Creditors: amounts falling due (1,374,546) (230,449) (1,120,971) (66,460)
within one year
Net current assets 821,795 1,520,563 545,142 1,308,766
Total assets less current 2,808,320 3,107,455 2,502,631 2,895,658
liabilities
Creditors: amounts falling due (188,650) (66,658) (125,087) (94,235)
after more than one year
2,619,670 3,040,797 2,377,544 2,801,423
Capital and reserves
Called up share capital 935,350 935,350 935,350 935,350
Share premium account 1,513,530 1,513,530 1,513,530 1,513,530
Profit and loss account 170,790 591,917 (71,336) 352,543
2,619,670 3,040,797 2,377,544 2,801,423
Cash Flow Statement
For the period ended 31 March 2007
2007 2006
# (Restated)
#
Net cash inflow from operating activities 251,186 699,800
Returns on investment and servicing of finance
Bank interest received 9,990 9,143
Bank interest paid (12,152) (13,587)
Interest element of finance lease payments (7,773) (5,425)
Net cash outflow from returns on investments and servicing of (9,935) (9,869)
finance
Capital expenditure
Purchase of tangible fixed assets (406,957) (455,709)
Sale of tangible fixed assets 11,870 9,646
Net cash outflow from capital expenditure (395,087) (446,063)
Equity dividends paid (50,509) (46,768)
Management of liquid finances 280,000 (185,000)
Decrease/(increase) in short term deposits
Net cash inflow before financing 75,655 12,100
Financing
Bank loans advanced in the year 150,000 -
Bank loans repaid during year (82,342) (55,408)
Share issue costs recovered - 17,377
Capital element of finance lease payments (55,794) (100,093)
Net cash inflow/(outflow) from financing 11,864 (138,124)
Increase/(decrease) in cash 87,519 (126,024)
Notes
1 Accounting Policies
Accounting convention
The accounts have been prepared under the historical cost convention and in
accordance with applicable UK accounting standards.
Basis of consolidation
The accounts of the Group consolidate the accounts of the Company and its
subsidiaries up to 31 March 2007.
Goodwill
Goodwill arising on consolidation (representing the excess of the fair value of
the consideration given over the excess of the separable net assets acquired) is
capitalised save to the extent that there is considered to be an impairment in
value in which event the loss is charged to the profit and loss account.
Amortisation is provided over 20 years on a straight line basis, the estimated
useful life of the goodwill.
Turnover
Turnover represents amounts invoiced to customers for services rendered
excluding VAT. Turnover relates to the group's principal activity and arises
wholly in the UK.
Tangible fixed assets
Tangible fixed assets are stated at cost. Depreciation is provided at rates
which are expected to write off the assets to their residual value over their
expected economic lives. The principal rates used are as follows:
Motor vehicles 33% straight line
Plant and machinery 17% to 50% straight line
Office and computer equipment 33% straight line
Leasehold property Over the term of the lease
Amounts previously included in stock have been re-designated as fixed assets as
the nature of these assets is that they have a useful economic life of more than
12 months.
The directors have reviewed the useful economic life of certain items of plant
and machinery. Those that were previously depreciated over 2 years are now
written off over a period of 3 years which has led to a reduction in the
depreciation charge for the year of #97,431. Those that were previously
depreciated over 6 years are now written off over a period of 8 years which has
led to a reduction in the depreciation charge for the year by #49,683. The new
rates have been applied so as to write off the net book value of fixed assets at
31 March 2006 over the new remaining useful lives.
Deferred taxation
Deferred tax is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more tax in the future or a right to
pay less tax in the future have occurred at the balance sheet date. Timing
differences are differences between the Group's taxable profits and its results
as stated in the accounts that arise from the inclusion of gains and losses in
tax assessments in periods different from those in which they are recognised in
the accounts.
Deferred tax is measured at the average tax rates that are expected to apply in
the periods in which timing differences are expected to reverse, based on tax
rates and laws that have been enacted or substantially enacted by the balance
sheet date. Deferred tax is measured on a non-discounted basis.
Deferred tax assets are recognised where recovery is more likely than not.
Pension scheme arrangements
Payments to defined contribution pension schemes are charged to the profit and
loss account in the year in which they are made.
Lease commitments
Assets held under finance leases are capitalised in the balance sheet and
depreciated over their estimated useful lives.
Interest on finance leases is charged to the profit and loss account over the
period of the lease or contract.
Rentals paid under operating leases are charged to the profit and loss account
as incurred.
Share based payments
The fair value of employee services received in exchange for the grant of
options is recognised as an expense. The total amount to be expensed over the
vesting period is determined by reference to the fair value of the options.
Non-market vesting conditions are included in assumptions about the number of
options that are expected to become exercisable. This estimate is revised at
each balance sheet date and the difference is charged or credited to the profit
and loss account, with a corresponding adjustment to equity.
2 The Group has a liability to UK corporation tax of
#18,129. The remaining balance of the movement in the year relates to deferred
taxation.
Taxation 2007 2006
# #
The tax charge for the year comprises:
Corporation tax on profit/(loss) for the year 18,129 -
Movement in deferred tax (see note 14) (106,298) (1,611)
(88,169) (1,611)
Factors affecting the tax for the year
The tax assessed for the year differs from the profit/(loss)
for the year at the small companies' corporation tax rate of
19% (2006 - 19%). The differences are explained below:
Profit/(loss) on ordinary activities before taxation 196,479 (38,380)
Profit/(loss) on ordinary activities multiplied by the small
companies' rate of UK corporation tax of 19% (2006 : 19%) 37,331 (7,292)
Effects of:
Disallowed expenses 9,585 5,693
Utilisation of tax losses (43,016) -
Capital allowances in excess of depreciation (1,560) 1,229
Other timing differences - 370
Goodwill amortisation not deductible 15,789 -
Current year charge for taxation 18,129
-
The movement in the deferred tax is made up as follows:
Origination and reversal of timing differences 1,419
Adjustment relating to estimated recoverable amounts of (107,717)
deferred tax assets -losses not previously recognised
(106,298)
3 Basic (loss)/earnings per share is based on the (loss)/
profit for the year attributable to shareholders and on the weighted average
number of shares in issue during the year. The number of shares used for
calculating basic (loss)/earnings per share was 18,706,961 (2006 - 18,706,961).
Basic earnings per share excluding the effect of goodwill has been disclosed in
order that the effect of goodwill amortisation on reported (loss)/earnings can
be fully appreciated.
As the exercise price of the share options granted by the company exceeded the
average market price of the shares during the current and prior periods, there
is no dilutive impact on earnings per share in either period.
4 The financial information on the Group set out above does
not constitute statutory accounts within the meaning of section 240 of the
Companies Act 1985. Information relating to the year ended 31 march 2006 is
derived from the statutory accounts for that year, which have been delivered to
the Registrar of Companies. The auditor's report on those accounts was
unqualified and did not contain a statement under section 237(2) or (3) of the
Companies Act 1985. The statutory accounts for the year ended 31 March 2007
will be delivered to the Registrar of Companies following the Company Annual
General Meeting.
5 The preliminary announcement was approved by the Board and authorised
by them for issue on 5 September 2007.
6 Copies of the 2007 Report and Accounts will be posted to shareholders
shortly. Copies will be available from the Company's registered office at
Forest House, Broad Quay Road, Felnex Industrial Estate, Newport, Gwent.
NP19 4PN.
7 The directors recommend the payment of a dividend of 0.36p per share
(2006 - 0.27p).
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UVVVRBVRKRAR
Forest Sup. (LSE:FSS)
과거 데이터 주식 차트
부터 2월(2) 2025 으로 3월(3) 2025
Forest Sup. (LSE:FSS)
과거 데이터 주식 차트
부터 3월(3) 2024 으로 3월(3) 2025
