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As a result of the EGM held in August the Company has changed its name from Clyde Marine to Lewmar Marine. The Directors believe that, combined with the integration of the Navtec businesses into Lewmar, this will further extend Lewmar’s global brand awareness.
The Company and its employees have confronted a number of challenges during the past year including a deteriorating US dollar, substantial increases in raw material costs and continued price pressure from our largest customers, despite which a substantially better result than the previous year has been achieved.
In the year to the 30 June 2007, sales increased and margins improved with result that the Group achieved an operating profit of £2.1m. This compares to an operating loss (before impairment of goodwill) of £0.5m in the year to June 2006. After interest and tax the profit attributable to shareholders was £0.9m compared to a loss of £9.4m in the prior year (which included a charge for impairment of goodwill of £8.1m).
Earnings per share was 12p compared to loss per share of 124p in the prior year. The substantial loss in the prior year was mainly due to the goodwill impairment charge. Excluding this the loss per share would have been 17p.
At 30 June 2007 shareholders’ funds increased by £0.4m (after exchange translation losses of £0.5m) to £16.2m (216p per share) which includes £7.0m for the brand. Of greater significance, however, net debt fell by £1.2m to £9.0m, which compares more favourably with shareholders funds less intangible assets of £9.2m than in the past.
With the strategic development of the business and debt repayment remaining a priority the Directors have decided as in the prior year not to recommend the payment of a dividend. The position will be kept under review.
The share price is currently 83.0p compared to 90.0p in the prior year. Very few shares were traded during the period.
Although significant strides were made in 2006/7 to revitalise the business it is a slow process as we are dependent on generating the capital required for investment from operations, which is also needed for repayment of debt.
The continuing development of our range of products will provide us with fresh opportunities for growth in sales to major boat builders. I can report that the year has started well with above budget sales in the two months to the end of August.
Selective selling price increases will offset to some extent raw material cost increases, but any increases in price will ultimately be limited by competitive market forces. Therefore, we will continue to reduce product costs through a number of initiatives including improved in house manufacturing, selective outsourcing, product range rationalisation and working with customers and suppliers to innovate production efficiencies.
Navtec, whose principal business is the manufacture of rigging for leisure boats, is being integrated into the Lewmar businesses whose principal business is the manufacture and distribution of deck equipment. This change is already bearing fruit with reduced operating costs and better sales co-ordination.
Peter O’Connell has been appointed as the Chief Executive Officer of the Group. I would like to congratulate Peter on his achievements so far and wish him well with tasks ahead.
Arthur MacMillan relinquished his position as a Non-Executive Director at the end of June. I would like to thank Arthur for all his efforts on behalf of the Company. The Board is in process of seeking a new independent Non-Executive Director.
I would like to thank all who have worked so hard to make the improvements outlined above and to ensure their sustainability.
The Annual General meeting will be held on Tuesday 27 November 2007 at Swire House in London. In addition there will be an opportunity for shareholders to meet the Directors in Glasgow on Monday 3 December. More details will be provided with the papers issued for the AGM.
Rhoddy Swire FCA,
Chairman
21 September 2007
- Turnover for year to 30 June 2007 increased by 6% from £54.9m to £58.1m
- Operating profit/loss for year to 30 June 2007 was £2.1m profit (2006: £8.6m loss)
- Basic earnings/loss per share were 12p earnings (2006:124p loss)
- Shareholders' funds increased by £0.4m to £16.2m at the end of 2007
- Net debt decreased from £10.2m to £9.0m during the year to 30 June 2007
The preliminary results for the group for the year ended 30 June 2007 are summarised as follows:
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Year
2007
£000
Unaudited |
Year
2006
£000
Audited |
| TURNOVER |
58,115 |
54,923 |
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Operating profit/(loss) before imparment of goodwill |
2,050 |
(543) |
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Impairment of goodwill |
- |
8,080 |
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Operating profit/(loss) |
2,050 |
(8,623) |
| Net interest payable |
(756) |
(813) |
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Profit/(loss) on ordinary activities before taxation |
1,294 |
(9,436) |
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Tax on profit on ordinary activites |
(423) |
81 |
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Profit/(loss) on ordinary activities after taxation |
871 |
(9,355) |
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Basic earnings/(loss) per ordinary share |
12p |
124p |
All operations of the Group are regarded as continuing operations.
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At 30 June
2007
£000
Unaudited |
At 30 June 2006
£000
Audited |
| FIXED ASSETS |
Intangible |
7,000 |
7,000 |
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Tangible |
5,381 |
6,353 |
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12,381 |
13,353 |
| CURRENT ASSETS |
Stocks |
14,934 |
13,184 |
| Debtors |
9,743 |
9,340 |
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Cash at bank and in hand |
742 |
477 |
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25,419 |
23,001 |
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CREDITORS: Amounts falling due within one year |
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15,141 |
13,378 |
| NET CURRENT ASSETS |
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10,278 |
9,623 |
| TOTAL ASSETS LESS CURRENT LIABILITIES |
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22,659 |
22,976 |
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CREDITORS: Amounts falling due after more than one year |
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4,858 |
5,431 |
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PROVISIONS FOR LIABILITIES |
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1,571 |
1,702 |
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NET ASSETS |
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16,230 |
15,843 |
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CAPITAL AND RESERVES |
Called up share capital |
1,881 |
1,881 |
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Share premium account |
3,913 |
3,913 |
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Capital reserve |
231 |
231 |
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Profit and loss account |
10,205 |
9,818 |
| SHAREHOLDERS FUNDS |
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16,230 |
15,843 |
The directors of the issuer accept responsibility for this announcement.
The financial information set out above does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. The Company’s statutory accounts for the financial period ended 30 June 2007 will be delivered to the Registrar of Companies in due course.
The results for the full year ended 30 June 2006 are taken from accounts filed with the Registrar of Companies which contain an unqualified audit report, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their reports and did not contain any statement under section 237 of the Companies Act.
The information contained within this announcement has been agreed with the independent auditors.
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