Final Results
March 18 2003 - 2:01AM
UK Regulatory
RNS Number:8449I
Bilston & Battersea Enamels PLC
18 March 2003
Preliminary Results for the year ended 31 December 2002
Bilston & Battersea Enamels plc announces its preliminary results for the year
ended 31 December 2002.
Chairman's Statement
Results
Sales in the year were close to those of the prior year while the #517,000
pre-tax loss was converted into a #83,000 profit. This was a result of improved
trading at Fine Ceramic Transfers and a lower cost base across the core Halcyon
Days Enamels business. Cash at year end was #380,000 compared with #436,000.
The Directors do not recommend a dividend in respect of the year (2001: 1p per
share).
Halcyon Days Enamels sales were helped slightly in the U.K. by the success of
royal commemoratives while sales in the U.S. and the rest of the world stayed
unchanged at the depressed 2001 level.
The Carolyn Sheffield business had a second consecutive poor year in sales and
profits. U.S. retailers are behaving very cautiously in the current consumer
slowdown and it has proved difficult to develop retail distribution for the
brand.
F.C.T. third party sales were up by 17% and a #29,000 operating loss was
reversed to a #42,000 operating profit. This reflected the anticipated gradual
improvement in external sales and better utilisation of the recently acquired
new printing capacity.
2002 Overview
The company carried through the planned cost savings last year and developed
further savings projects which will impact 2003, but to a lesser extent.
The Halcyon Days Enamels range has been rationalised down as planned and
increased focus given to the successful "social expression" designs (not unlike
Greetings Cards) and to the development of jewelled boxes. The first example of
this was successful in the pre-Christmas period of 2002 and a substantial
expansion of this idea was put in hand. There has been steady consolidation of
Halcyon Days business in Japan and Hong Kong, a plan has been developed for
Taiwan and, in 2003, for mainland China. The company recognised that a recovery
in sales of the core enamels business to the more acceptable 1996 - 2000 level
will be slow and difficult to achieve. We embarked last year on two
diversification projects designed to take the basic enamels proposition to
different target groups and retail distribution. These should start to have
some impact in 2003 and 2004.
As noted above, the Carolyn Sheffield business failed to meet targets. A new
range of tablemats and trays was developed in 2002 and will help the brand's
sales in the coming years. New designs for the core decorative products were
also developed which will address the problem that the Carolyn Sheffield "look"
has strong appeal but not to consumers with contemporary taste. Having said
this, it's clear that the company needs successfully to exploit the
redevelopment concepts introduced last year during the coming twelve months or
evaluate whether this business will have a secure future.
F.C.T. has made a modest recovery from its poor 2001 result despite continuing
difficult trading in its core Stoke-on-Trent pottery industry. There is a niche
business opportunity in the industry for short-run, high quality work and F.C.T.
is making gradual good progress in establishing itself as a lead company in this
specialism.
Our partners, Halcyon Days (London) Limited, had a successful sales year thanks
to excellent exploitation of the royal commemorative opportunity and the
improving use of its Internet and catalogue capability. 2002 again saw
excellent design work and the usual strong commitment to new design and new
product development.
Outlook
Sales in the first quarter are in line with expectation but the Directors are
not anticipating any substantial recovery in 2003. Consumer confidence in the
U.K. and U.S. is subdued and the company will do well to maintain sales and hold
on to the cost savings programmes of 2002 and planned this year. The 2002
Christmas period was reasonably successful such that pipeline fill in 2003 is at
least at a normal level or a little above. Central London retailing is weak and
may stay so until the current worldwide political concerns are put behind us.
The company is increasingly dependent worldwide on Direct Mail and Internet
promotion by our retailer partners, which is being given maximum emphasis.
2003 should prove to be a year of consolidation for the core business and,
hopefully, one when one or more promising diversification projects may take
root. The Directors intend to maintain tight control over operating expense and
the management of cash until economic conditions become more favourable.
Bid by Enesco Holdings Limited
Later today the Board will announce the terms of a recommended cash offer by
Enesco Holdings Limited to acquire the whole of the issued and to be issued
share capital of the Company. We would ask shareholders to read the Offer
Document and consider the terms of the offer very carefully.
Ray Way
Chairman
18 March 2003
Group Profit and Loss Account for the year ended 31st December 2002
Year ended Year ended
31st December 31st December
2002 2001
Normal group Expenditure on cost Reported group
activity reduction programmes profits
#000 #000 #000 #000
Turnover 6,113 6,004 - 6,004
Cost of sales (2,852) (2,907) - (2,907)
Gross profit 3,261 3,097 - 3,097
Sales royalties and (641) (690) - (690)
commissions
Sales and
administration costs (2,518) (2,742) (162) (2,904)
Operating profit/(loss) 102 (335) (162) (497)
Net interest payable (19) (20)
Profit/(loss) on 83 (517)
ordinary activities
before taxation
Taxation (30) 150
Profit/(loss) on 53 (367)
ordinary activities
after taxation
Equity minority (6) 13
interest
Profit/(loss) for the 47 (354)
financial period
attributable to members
of the parent company
Dividends - (89)
Retained profit/(loss) 47 (443)
for the financial
period
Basic earnings/(loss) 0.5p (4.0)p
per share
Diluted earnings/(loss) 0.5p (4.0)p
per share
Dividends per share Nil 1.00p
Group Balance Sheet as at 31st December 2002
2002 2001
#000 #000
Fixed assets
Goodwill arising on acquisitions 40 58
Tangible assets 686 836
726 894
Current assets
Stocks 847 946
Debtors 1,550 1,495
Cash at bank and in hand 380 436
2,777 2,877
Creditors: amounts falling due within one year (1,700) (1,961)
Net current assets 1,077 916
Total assets less current liabilities 1,803 1,810
Creditors: amounts falling due after more than one (60) (120)
year
1,743 1,690
Capital and reserves
Called up share capital 887 887
Share premium account 470 470
Profit and loss account 319 272
Shareholders' funds 1,676 1,629
Equity minority interests 67 61
1,743 1,690
Group Cash Flow Statement for the year ended 31 December 2002
2002 2001
#'000 #'000 #'000 #'000
Operating activities:
Operating profit/(loss) 102 (497)
Depreciation and amortisation 287 331
Loss/(profit) on sale of tangible fixed assets 2 (5)
Decrease in stocks 99 95
(Increase)/decrease in debtors (61) 290
(Decrease) in creditors (121) (98)
Net cash inflow from operating activities 308 116
Returns on investments and servicing of finance:
Net bank interest (payable)/receivable (4) 5
Interest element of hire purchase payments (15) (25)
Net cash outflow from returns on investments and servicing
of finance (19) (20)
Tax paid:
UK corporation tax paid (55) (23)
Capital expenditure:
Purchase of tangible fixed assets (112) (119)
Sale of tangible fixed assets 48 24
Net cash outflow from capital expenditure (64) (95)
Equity dividends paid (89) (191)
Net cash inflow/(outflow) before financing 81 (213)
Financing:
Capital element of hire purchase payments (137) (121)
Net cash outflow from financing (137) (121)
(Decrease) in cash in the year (56) (334)
1. The financial information set out above does not constitute the
Company's statutory accounts for the years ended 31 December 2001 or 2002 but is
derived from those accounts. Statutory accounts for 2001 have been delivered to
the Registrar of Companies, whereas those for 2002 will be delivered following
the Company's Annual General Meeting. The auditors have reported on the
accounts; their reports were unqualified and did not contain a statement under
section 237(2) or (3) of the Companies Act 1985.
2. The earnings per share is calculated by reference to the average
number of ordinary shares in issue of 8,873,000 and the profit for the financial
year attributable to the members of the parent company of #47,000.
3. Copies of this announcement are available from the
Company's registered office at Bilston & Battersea Enamels plc, 14-16 Barton
Park, Mount Pleasant, Bilston, West Midlands WV14 7LH, England.
4. The accounts for the year ended 31 December 2001 have been
restated to reflect the prior year adjustment consequent on implementing FRS 19
relating to deferred taxation. This increased the tax credit previously reported
in the profit and loss account for the prior year by #45,000. The deferred
taxation asset of #41,000 (2001: #47,000) is included within debtors.
For further information, please contact:
Ray Way Chairman
Hugh Gledhill Managing Director
Ross Cheshire Financial Director
at Bilston & Battersea Enamels plc 01902 353485
This information is provided by RNS
The company news service from the London Stock Exchange
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