RNS Number:0898A
Brent International PLC
2 November 1999
INTERIM RESULTS FOR THE SIX MONTHS TO 30 JUNE 1999
CHAIRMAN'S STATEMENT
On 21 July 1999 the Board of Brent announced a
recommended offer to acquire the ordinary shares of Brent
International PLC from Chemetall GmbH. On 1 September
1999 this offer was declared unconditional and, as
Chemetall has already received acceptances from over 90%
of Brent's ordinary shareholders, the Brent Group became
part of Chemetall from that date. The ordinary shares of
Brent are expected to be delisted from the London Stock
Exchange shortly.
Brent's preference shares remain listed on the London
Stock Exchange and, while that remains the case, the
Group will continue to prepare and publish annual and
interim accounts in substantially the same form as
before.
Continuing Operations
The continuing operations comprise the Surface Science
and Aerospace division and Dyes, our German water-based
coatings business.
Difficult trading conditions resulted in these businesses
reporting modestly reduced turnover and operating profits
compared to the equivalent period of 1998. The
previously announced reduction in head office costs
implemented at the end of June will benefit future
periods.
Discontinued Operations
The sale of Swale Process was completed on 30 June 1999.
The results of this business up to the date of disposal
are included in "discontinued operations" in the profit
and loss account. The comparative figures for 1998 also
include the results of the Imaging Division which was
sold during the second half of 1998.
Non-recurring Items
The non-recurring items relate to the costs of
reorganising operations in France, provision for costs
related to the departure of the former Chief Executive,
and provision for costs related to the offer from
Chemetall.
Loss on Disposal
The loss on disposal related to the disposal of Swale
Process after taking into account the impairment review
included in the 1998 accounts.
Finance
The Group had net cash balances at the end of June of
#3.5 million
The Board will ensure that the Group remains
appropriately financed taking into account future cash
flows including those related to Brent's preference
shares. In the offer document dated 21 July 1999 the
following statement about preference shares was made on
behalf of Chemetall:
"Although no offer is being made for the Brent preference
shares, Chemetall has confirmed that it will ensure that
the rights attaching to those shares are observed."
Dividend
Under the terms of the offer from Chemetall the Board
decided not to pay any dividends to existing ordinary
shareholders after the final dividend for 1998. Since
the acquisition of Brent by Chemetall, no interim
dividends have been paid to the new parent company.
Millennium Bug
Our new computer system implementation is now complete.
Brent has not identified any critical internal systems
which may be affected by the Millennium Bug. However,
given the Group's interdependence with third parties,
there can be no assurance that the Millennium Bug will
not adversely affect the Group's operations or financial
results.
Board Changes
As we announced in September, Messrs Hutchings, Lusher
and Burn resigned from the Board. I would like to thank
them for their contribution to the Company. Also, in
September, Dr Jurgen Faesel, Mr Ernst-Joachim Molter and
Mr Thomas Klatt joined the Brent Board. Mr Molter has
become the Chief Executive.
Outlook
The combination of Brent and Chemetall is a significant
development for both companies. It has created a leading
worldwide surface sciences business providing an
excellent range of products and services for customers
and significant opportunities for employees.
Alec Daly CBE
Chairman
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED JUNE 1999
CONSOLIDATED PROFIT AND LOSS ACCOUNT
notes
Contin Discon Half Year
uing tinued Total year ended
operat operat 1999 ended 31
ions ions 30 Decemb
1999 1999 #000 June er
1998 1998
#000 #000 #000 #000
Group turnover 1 34,464 15,959 50,423 67,318 126,447
Group operating
profit/(loss) 2,238 (474) 1,764 4,121 5,603
before non-
recurring items
Non-recurring (1,554) - (1,554) - (1,520)
items
Group operating 684 (474) 210 4,121 4,083
profit
(Loss) on
disposal of (797) - (797) - (793)
discontinued
operations
Provision for
loss on disposal - - - - (11,560)
of operations
(Loss)/profit on
ordinary (113) (474) (587) 4,121 (8,270)
activities
before interest
Group net (233) (551) (1,011)
interest payable
(Loss)/profit on
ordinary (820) 3,570 (9,281)
activities
before taxation
Taxation on
(loss)/profit on (700) (1,125) (2,210)
ordinary
activities
(Loss)/profit on
ordinary (1,520) 2,445 (11,491)
activities after
taxation
Preference (540) (540) (1,080)
dividend
(Loss)/profit
attributable to (2,060) 1,905 (12,571)
ordinary
shareholders
Ordinary - (743) (2,365)
dividend
Amount
transferred (2,060) 1,162 (14,936)
(from)/to
reserves
Earnings per 2
share (pence)
Basic
(loss)/earnings (3.0) 2.8 (18.6)
per share
Diluted
(loss)/earnings (3.0) 2.8 (18.5)
per share
IIMR headline
(loss)/earnings (1.8) 2.8 (0.3)
per share
Adjusted 0.5 2.8 1.9
earnings per
share
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
CONSOLIDATED BALANCE SHEET
Half Year
year ended
ended 31
1999 30 Decemb
#000 June er
1998 1998
#000 #000
Fixed assets
Tangible 17,985 28,468 20,166
Investments in associates 170 190 151
Other investments 78 85 85
18,233 28,743 20,402
Current assets
Stocks 5,346 10,037 6,971
Debtors 21,524 36,508 28,042
Cash at bank and in hand 6,595 8,261 9,485
33,465 54,806 44,498
Creditors: amounts falling due (13,921)(28,697)(21,564)
within one year
Net current assets 19,544 26,109 22,934
Total assets less current 37,777 54,852 43,336
liabilities
Creditors: amounts falling due (3,624) (14,536)(6,462)
after more than one year
Provisions for liabilities and (2,803) (1,218) (2,696)
charges
31,350 39,098 34,178
Capital and reserves
Called-up share capital 18,779 18,757 18,757
Share premium account 28,724 28,557 28,577
Profit and loss account (16,153) (8,216) (13,136)
Shareholders' funds 31,350 39,098 34,178
Equity interest 19,350 27,098 22,178
Non-equity interest 12,000 12,000 12,000
Shareholders' funds 31,350 39,098 34,178
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
MOVEMENT IN SHAREHOLDERS' FUNDS
Half Year
year ended
ended 31
1999 30 Decemb
#000 June er
1998 1998
#000 #000
(Loss)/profit for the period (1,520) 2,445 (11,491)
Dividends paid and proposed (540) (1,283) (3,445)
Transfer (from)/to reserves (2,060) 1,162 (14,936)
Goodwill realised on disposal - - 6,248
Goodwill realised on provision
for loss on disposal of - - 4,603
businesses
Issue of ordinary shares 189 - -
Other recognised gains and (957) (346) 845
losses relating to the period
Net (decrease)/increase in (2,828) 816 (3,240)
shareholders' funds
Opening shareholders' funds 34,178 38,132 38,132
Prior period adjustments - 150 (714)
Closing shareholders' funds 31,350 39,098 34,178
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
CONSOLIDATED CASH FLOW STATEMENT
Half Year
year ended
ended 31
1999 30 Decemb
#000 June er
1998 1998
#000 #000
Net cash inflow from operating (441) 3,503 5,832
activities
Returns on investments and
servicing of finance
Interest received 51 58 148
Interest paid (32) (350) (704)
Interest element of finance (256) (309) (580)
lease rental payments
Dividends paid on non-equity (540) (540) (1,080)
shares
Net cash (outflow) (777) (1,141) (2,216)
Taxation (321) (2,217) (2,865)
Capital expenditure
Purchase of tangible fixed (2,635) (3,249) (6,792)
assets
Sale of tangible fixed assets 126 50 167
Net cash (outflow) (2,509) (3,199) (6,625)
Acquisitions and disposals
Sale of businesses 5,503 - 16,700
Disposal expenses (2,256) - (1,210)
Net cash inflow 3,247 - 15,490
Equity dividends paid (1,621) (1,621) (2,365)
Net cash (outflow)/inflow (2,422) (4,675) 7,251
before financing
Financing
Issue of ordinary share capital 189 - -
Debt due within one year:
New short-term borrowings - 1,841 -
Repayment of short-term - (2,480) (3,057)
borrowings
Transferred with businesses - - (223)
sold
Debt due beyond one year:
New medium-term borrowings - 7,191 -
Repayment of medium-term - (737) (1,283)
borrowings
Transferred with businesses - - (234)
sold
Capital element of finance (393) (459) (885)
lease payments
Net cash (outflow)/inflow (204) 5,356 (5,682)
(Decrease)/increase in cash in (2,626) 681 1,569
the period
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
Half Year
Reconciliation of Operating year ended
profit to net cash inflow from ended 31
operating activities 1999 30 Decemb
#000 June er
1998 1998
#000 #000
Operating profit 681 3,305 4,170
Reorganisation costs paid (640) (561) (1,058)
Release of reorganisation - - (167)
provision
Provision for loss on - - 500
Engineering project
Provision for head office - - 720
reorganisation
Provision for costs relating to 519 - 300
approaches received
Provision for KH termination 551 - -
costs
Provision for pension costs 79 - -
Depreciation charges 1,875 2,435 4,699
(Loss)/profit on sale of (1) 3 (4)
tangible fixed assets
(Increase)/decrease in stocks (67) 351 91
(Increase) in debtors (3,082)(3,663) (1,618)
Increase/(decrease) in 118 814 (1,729)
creditors
Net cash inflow from continuing 33 2,684 5,904
operations
Net cash (outflow)/inflow from (474) 819 (72)
discontinued operations
Net cash (outflow)/inflow from (441) 3,503 5,832
operating activities
ANALYSIS OF NET FUNDS
1 Cash Exchange Disposal 30 June
January flow movement of 1999
1999 business
es
Cash 9,485 (2,626) (264) - 6,595
Finance (6,457) 393 250 2,729 (3,085)
leases
Total 3,028 (2,233) (14) 2,729 3,510
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
RECONCILIATION OF NET CASH FLOW TO MOVEMENT
IN NET FUNDS
1999
#000
Decrease in cash in the period (2,626)
Cash outflow from decrease in 393
lease financing
Change in net debt resulting (2,233)
from cash flows
Debt transferred on disposal of 2,729
businesses
Translation difference (14)
Movement in net debt in the 482
period
Net funds at 1 January 1999 3,028
Net funds at 30 June 1999 3,510
STATEMENT OF RECOGNISED GAINS AND LOSSES
Half Year
year ended
ended 31
1999 30 Decemb
#000 June er
1998 1998
#000 #000
(Loss)/profit for the period (1,527) 2,445 (11,491)
Currency translation
differences on foreign currency (957) (346) 845
net investments
Total recognised (losses)/gains (2,484) 2,099 (10,646)
relating to the period
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
NOTES TO THE UNAUDITED RESULTS
Half Year
1. SEGMENT INFORMATION year ended
ended 31
1999 30 Decemb
#000 June er
1998 1998
#000 #000
Turnover
Geographical area
UK 6,189 7,399 13,618
Continental Europe 20,685 20,366 40,486
Americas 7,671 8,235 16,232
Total continuing operations 34,645 36,000 70,336
UK 15,878 26,762 49,171
Continental Europe - 4,556 6,940
Total discontinued operations 15,878 31,318 56,111
50,423 67,318 126,447
Business segment
SSA 26,825 28,351 55,768
Inks & Coatings 7,720 7,649 14,568
Total continuing operations 34,545 36,000 70,336
Inks & Coatings 15,878 17,990 33,975
Imaging Management - 13,328 22,136
Total discontinued operations 15,878 31,318 56,111
50,423 67,318 126,447
(Loss)/profit before taxation
Geographical area
UK (2,652) (201) (1,914)
Continental Europe 2,778 2,870 4,728
Americas 558 633 1,341
Total continuing operations 684 3,302 4,155
UK (373) 625 41
Continental Europe (101) 194 (113)
Total discontinued operations (474) 819 (72)
Loss on disposal of (797) - (793)
discontinued operations
Provision for loss on sale of - - (11,560)
operations
Net interest payable (233) (551) (1,011)
(820) (3,570) (9,281)
Business segment
SSA 2,506 2,648 5,260
Inks & Coatings 1,181 1,310 1,674
Total discontinued operations 3,687 3,958 6,934
Inks & Coatings (474) 308 (819)
Imaging Management - 511 747
Total discontinued operations (474) 819 (72)
Loss on disposal of (797) - (793)
discontinued operations
Provision for loss on sale of - - (11,560)
operations
Non-recurring items (1,554) - (1,520)
Net interest payable (233) (551) (1,011)
Unallocated costs (1,449) (656) (1,259)
(820) 3,570 (9,281)
BRENT INTERNATIONAL PLC
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 1999
NOTES TO THE UNAUDITED RESULTS (CONTINUED)
2. EARNINGS PER SHARE
Basic (loss)/earnings per share are calculated on the
Group (loss)/profit attributable to shareholders of
#2,060,000 divided by the weighted average number of
shares in issue during the year, being 67,975,036 shares.
Diluted (loss)/earnings per share takes into account the
dilutive effect of share options.
(Loss)/earnings per share are based on Institute of
Investment Management and Research definition of earnings
per share (IIMR headline (loss)/earnings per share) and
earnings per share adjusted for non-recurring items are
also given, to assist year on year comparison.
A reconciliation of basic (loss)/earnings per share with
diluted (loss)/earnings per share, IIMR headline
(loss)/earnings per share and adjusted earnings per share
is as follows:
Earnings per share
Half year 1999
#000 Number of Pence
shares per
share
Basic (loss)/earnings per (2,060) 67,975,036 (3.0)
share
Impact of share options - - -
Diluted (loss)/earnings per (2,060) 67,975,036 (3.0)
share
Half year 1998
#000 Number of Pence
shares per
share
Basic (loss)/earnings per 1,905 67,568,292 2.8
share
Impact of share options - - -
Diluted (loss)/earnings per 1,905 67,568,292 2.8
share
Full year 1998
#000 Number of Pence
shares per
share
Basic (loss)/earnings per (12,571)67,568,292 (18.6)
share
Impact of share options - 406,744 0.1
Diluted (loss)/earnings per (12,571)67,975,036 (18.5)
share
IIMR Headline earnings per share and adjusted earnings
per share
Half year 1999
#000 Number of Pence
shares per
share
Basic (loss)/earnings per (2,060) 67,975,036 (3.0)
share
Eliminate:
(Profit)/loss on sale of (1) - -
fixed assets
Loss on sale of Swale Group 692 - 1.0
businesses
Loss on sale of Imaging 105 - 0.2
Management businesses
IIMR headline (1,264) 67,975,036 (1.6)
(loss)/earnings per share
Non-recurring items 1,554 - 2.3
Adjusted earnings per share 290 67,975,036 0.5
IIMR Headline earnings per share and adjusted earnings
per share (continued)
Half year 1998
#000 Number of Pence
shares per
share
Basic (loss)/earnings per 1,905 67,568,292 2.8
share
Eliminate:
(Profit)/loss on sale of 3 - -
fixed assets
Loss on sale of Swale Group - - -
businesses
Loss on sale of Imaging - - -
Management businesses
IIMR headline 1,908 67,568,292 2.8
(loss)/earnings per share
Non-recurring items - - -
Adjusted earnings per share 1,908 67,568,292 2.8
Full year 1998
#000 Number of Pence
shares per
share
Basic (loss)/earnings per (12,571)67,568,292 (18.6)
share
Eliminate:
(Profit)/loss on sale of (4) - -
fixed assets
Loss on sale of Swale Group 11,560 - 17.1
businesses
Loss on sale of Imaging 793 - 1.2
Management businesses
IIMR headline (222) 67,568,292 (0.3)
(loss)/earnings per share
Non-recurring items 1,520 - 2.2
Adjusted earnings per share 1,298 67,568,292 1.9
IIMR headline earnings per share and adjusted earnings
per share are calculated above in order to give a more
meaningful comparison and to assist in understanding the
underlying performance of the Group.
3. The results for the year to 31 December 1998 are an
extract from the latest published accounts which have
been delivered to the Registrar of Companies; the report
of the auditors on those accounts was unqualified.
4. The interim results were approved by the Board of
Directors on 1 November 1999.
5. The results for the half year have been prepared on
a basis consistent with the previous year end and in
accordance with the accounting policies disclosed in the
published accounts.
6. This announcement is being posted to all
Shareholders on 2 November 1999 and copies are available
at the Company's Registered Office.
7. The financial information in this statement does not
constitute statutory accounts within the meaning of
Section 240 of the Companies Act 1985.
8. There are no matters to be disclosed under paragraph
16.4 of the Listing Rules in relation to Dr Faesel, Mr
Molter or Mr Klatt.
For further information:
Bill Jessup, Finance Director, Brent International PLC
01753 651 812
Chris Skyrme, Clerkenwell Communications
0171 713 0900
END
IR ALLLTLLLLIAA
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