TIDMCMG
RNS Number : 5923S
Croma Group PLC
23 November 2011
CROMA GROUP PLC
23 November 2011
Final Results
Croma Group plc ("Croma" or the "Group"), the AIM listed total
security solutions provider, is pleased to announce its final
results for the year ended 30 June 2011, during which the Group has
completed the final stage in its restructuring and increased sales
substantially.
Highlights
-- Croma has enjoyed a third year of sales growth following the
final step in the restructuring of the business
-- Year-on-year sales increased by 67.5%
-- Pre-tax profit increased by 17.4%
-- The sale of the RDDS Avionics subsidiary resulted in an
exceptional charge of GBP743,000, producing a post-tax loss after
exceptional items of GBP626,000
Extracts from the financial statements follow and a full version
is available on the Company's website www.cromagroup.co.uk.
Sebastian Morley, CEO of Croma, commented "This has been a key
year in the restructuring and development of the Group. We have now
focused the businesses sharply onto the security sector,
concentrating on high sensitivity defensive security projects. Our
strategic partnership with CSS Group has broadened our offering to
a total security services solution for our clients and this has not
only enhanced our clients' security operations, it also adds value
to the Group in cross marketing opportunities. We look forward to
continuing this relationship and creating value for our
shareholders going forward."
Notice of Annual General Meeting
Croma Group plc today gives notice that the Annual General
Meeting ("AGM") of the Company will be held at Quality Hotel,
Edinburgh Airport, Ingliston, Edinburgh EH28 8AU on 16 December
2011 at 10.00 a.m. The notice of AGM has today been posted to
shareholders and is available on the Company's website
www.cromagroup.co.uk
Annual Report and Accounts
The Company announces that the annual report of the Company for
the year ended 30 June 2011 has been posted to shareholders today.
The annual report is also available on the Company's website
www.cromagroup.co.uk
Further information:
Croma Group Plc
Sebastian Morley +44 7768 006909
Brewin Dolphin
Sandy Fraser +44 (131) 529 0310
Chairman's Statement
I have pleasure in announcing the results of the Group for the
year ended 30 June 2011.
Financials
The results demonstrate the last element of the restructuring of
the business, which was completed with the sale of the Group's
subsidiary, RDDS Avionics Limited ("RDDS").The Group now stands
ready to continue to target the security services sector as the
engine for its future growth, based on the continuing success of
the Vigilant subsidiary.
Sales improved significantly during the year reaching GBP8.46
million against GBP5.05 million for 2010 (as re-stated for the sale
of RDDS). Gross profit was GBP1.62 million (2010: GBP1.38 million)
and operating profit was ahead at GBP322K (2010: GBP196K). The
pre-tax profit from continuing operations for the year was GBP143K
against a prior year loss of GBP6K.
The sale of RDDS realised GBP928K plus the possibility of a
further GBP600K in earn-out which the Board has for the time being
disregarded. This has required us to make a charge of GBP743K in
the period for the write-off of goodwill. The net loss attributable
to shareholders for the period of GBP626K (2010: profit GBP90K)
assumes no potential earn-out from the RDDS sale and but for the
goodwill write off the remaining businesses delivered a profit
attributable to shareholders of GBP116K against the loss
attributable to continuing operations for 2010 of GBP6K, a
substantial increase.
Business Review and outlook
Following the disposal of RDDS in March 2011, the Group has two
key business areas, access security and installation systems
(Photobase), and asset protection including manned guarding and key
holding (Vigilant), and the financial results of those businesses
are set out in more detail in the Directors' Report.
Towards the end of the year, Vigilant won its largest ever
contract, and since the year end further significant contracts have
been added. The benefit of these recent wins will fully impact on
current year results. The Directors are satisfied that improved
gross margins can be achieved in the coming year. The new contracts
continue the strategy of widening the national reach of the
business as well as broadening the client base to focus on large
private businesses rather than the Ministry of Defence and public
sector, which the Board continues to believe may be under threat
from central government cost-saving initiatives.
We said last year that the Board would continue to review
opportunities to improve efficiencies within the two subsidiaries,
as well as consider more strategic opportunities as and when they
arise. During the period, the Group announced the strategic
framework agreement with the CSS group of companies, which
specialises in using technology to add to the mix of security
solutions we can offer our clients. This arrangement has proved
very fruitful for both Croma and CSS; Photobase in particular has
made sales of GBP450K during the period due to the success of the
framework agreement.
The disposal of RDDS in March 2011 has enabled the Group to
repay GBP600K of the convertible loan notes issued in 2006 and it
is the intention of the Board to repay the balance of the loan
notes as and when the repayment dates fall due between December
2012 and February 2013. The loan note terms are explained more
fully in the notes to the accounts.
The Group is now focused, profitable and cash generative and
poised to take the opportunity to broaden its activity in the
delivery of security solutions. As ever, I thank our management and
staff for their efforts over the period in delivering another year
of steady growth.
Nick Hewson
Non-executive Chairman
22 November 2011
Consolidated Statement of Comprehensive Income
for the year ended 30 June 2011
2011 2010
GBP GBP
Revenue 8,457,665 5,045,765
Cost of sales (6,840,379) (3,670,386)
Gross profit 1,617,286 1,375,379
Administrative expenses (1,295,426) (1,179,317)
Operating profit 321,860 196,062
Finance expense costs (179,358) (201,666)
Profit / (loss) before
tax 142,502 (5,604)
Tax (26,031) -
------------ ------------
Profit / (loss) for the
year from continuing operations 116,471 (5,604)
(Loss) / profit from discontinued
operations (742,672) 95,831
(Loss) / profit and total
comprehensive (loss) /
profit for the year attributable
to owners of the parent (626,201) 90,227
============ ============
Basic earnings per share
(pence) (0.33) 0.05
Diluted earnings per share
(pence) (0.31) 0.07
Consolidated Statement of Financial Position
as at 30 June 2011
2011 2011 2010 2010
GBP GBP GBP GBP
Assets
Non-current assets
Property, plant and equipment 182,945 233,863
Goodwill 1,396,390 2,148,650
------------ ------------
1,579,335 2,382,513
Current assets
Inventories - 189,385
Trade and other receivables 2,231,912 2,271,121
Cash and cash equivalents 597,119 187,248
------------ ----------
2,829,031 2,647,754
------------ ------------
Total assets 4,408,366 5,030,267
------------ ------------
Liabilities
Non-current liabilities
Convertible loan notes (398,371) (379,856)
Deferred tax (7,223) (1,373)
Trade and other payables (26,826) (32,162)
Provisions (23,120) (28,900)
------------ ----------
(455,540) (442,291)
Current liabilities
Convertible loan notes (1,000,000) (965,068)
Trade and other payables (333,288) (313,412)
Current income tax liabilities (385,273) (450,609)
Accruals and deferred
income (164,001) (413,853)
Bank overdrafts and loans (883,773) (632,342)
------------ ----------
(2,766,335) (2,775,284)
Total liabilities (3,221,875) (3,217,575)
------------ ------------
Net assets 1,186,491 1,812,692
------------ ------------
Issued capital and reserves
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