TIDMMSI
RNS Number : 3728Q
MS International PLC
28 June 2022
Chairman's statement
Results and Review
It is a pleasure to report that, for the year ended 30(th) April
2022, the Company attained considerable progress across the Group's
divisions, resulting in a significantly improved pre-tax profit of
GBP5.97m (2021-GBP1.59m) on increased revenue of GBP74.52m
(2021-GBP61.54m).
Basic earnings per share amounted to 30.9p, (2021- 7.2p). The
balance sheet was further strengthened with cash and cash
equivalents rising to GBP18.1m (2021 - GBP17.4m).
The Group has made a strong recovery post the many constraints
imposed by Covid. This, I believe, demonstrates the tangible
benefits of operating an optimistic, long-term investment and
support strategy, that we practice daily, to support and encourage
the respective management teams that directly oversee the
operations of our diverse businesses.
During the period under review, two common themes continued to
feature across all divisions, namely the prolonged negative effects
of the global pandemic and extended periods of limited availability
of materials and components. Such issues required close and
constant monitoring by our management teams to ensure sustained
high-quality sales output. A job well done by everyone.
'Defence'
This was a remarkable year of great achievements for this
division, highlighted by the phased manufacture and delivery of the
first 7 of 8 No MSI-DS30mm naval weapon systems to the United
States Navy. This was achieved in a timely manner to facilitate our
customer's comprehensive test and certification programme of the
MSI product. The anticipated successful prototype testing of the
MSI weapon system, is the precursor to a highly prized sole source
'Follow-on Production Contract'. Presently, all trials are going to
plan and positive progress is being made.
In the UK, our new 'state of the art' Norwich manufacturing
facility is in the final phase of completion, whilst, in the United
States of America, we are in the early stages of our programme to
establish an appropriate product support resource for our weapon
systems, along-side our contemporary forging facilities, in South
Carolina. These projects are essential to support our perceived
growing defence opportunities in the United States.
We also firmly believe that our 'state of the art' weapon system
will significantly enhance the capability and protection of the
Royal Navy, once a forward-looking decision is made to upgrade
their existing historic, small calibre weapons systems. We stand
ready, with our modern manufacturing facilities and proven
international capabilities, to work with the UK MOD to meet such
requirements.
'Forgings'
This division also performed extremely well, successfully
navigating the disrupted, and constantly changing, international
business environment. There is little doubt that having established
contemporary automated 'local' production facilities - in the UK
and both North and South America, - successfully enabled MSI to
welcome and secure many customers that had previously procured
product from China.
'Petrol Station Superstructures' - mobility hubs
Operations in both the UK and the Poland performed resiliently
against a prevailing uncertain backdrop. Despite the challenges,
the division continued to make great progress, pleasingly exceeding
management's revenue forecasts. Many forecourt operators have
continued to develop their sites to incorporate a substantial
grocery store and catering facility and Global-MSI designed,
manufactured and erected many such structures during the
period.
As with all construction orientated businesses, the negative
impact of the lack of readily available materials and their
associated fluctuating costs, became a major factor in terms of
managing day to day operations. Such disruptive circumstances
necessitated some contracts to be re-negotiated to the mutual
satisfaction of all parties.
'Corporate Branding'
This division traded at similar levels to the prior year, as
commercial activity remained seriously constrained across mainland
Europe's national borders. We took action to restructure the
division's operations in both The Netherlands and Germany and much
has been achieved as a result, leaving it better geared to the
current needs of the market. Pleasingly, the UK based business has
continued to prosper, gaining market share and expanding
operational capabilities and facilities.
Outlook
'Defence'
Foremost, we look forward with confidence to a favourable report
on our 30mm naval weapon system, presently on approval test by the
US Navy.
Furthermore, recent events have served to focus attention on the
need for appropriate national security to combat potential lethal
land-based threats. We believe that, as our additional 'in-house'
product developments come to fruition, there will be numerous
opportunities across international markets to supply our, tested
and proven, land-based defence equipment.
'Forgings'
Demand for our high quality, forged products is increasing, as
customers seek assured and dependable security of supply. To that
end, we will continue to invest in further automating our
manufacturing facilities in the UK, the United States and South
America.
'Petrol Station Superstructures'
The markets we serve are vigorously embracing change, not only
in the development of providing and dispensing alternative fuel
types but also in broadening their provision of services to include
groceries and catering facilities. The development expertise and
scale of the buildings required to dispense such services are most
appropriate to the designs, manufacturing and erection skills of
Global-MSI. We expect further growth opportunities for both our UK
and Polish operations.
'Corporate Branding'
We have completed restructuring in The Netherlands and Germany
and expanded our UK operations. So, now that inter-country business
activity across mainland Europe has been restored, we are
cautiously optimistic that we will achieve a more profitable
division this year.
Pleasingly, we have already received instructions from a number
of major customers to speedily recommence projects, that they had
put 'on hold', owing to the scale and duration of the pandemic.
Summary
We believe that we have placed each of our businesses in a
strong and exciting position within the markets which we serve.
Close monitoring of performance and further support in the
development of new products and services will, no doubt, bring
further rewards.
All matters considered the Board recommends the payment of a
final dividend of 7.5p per share (2021 - 6.5p) making a total for
the year of 9.25p (2021 - 8.25p).
The final dividend is expected to be paid on the 12th August
2022, to those shareholders on the register at the close of
business on the 15th July 2022.
Michael Bell
27(th) June 2021
MS INTERNATIONAL plc
Michael Bell Tel: 01302 322133
Shore Capital (Nominated Adviser
and Broker)
Patrick Castle Tel: 020 7408 4090
Daniel Bush
Copies of this announcement are available from the Company's
registered office at MS INTE RNATIONAL plc, Balby Carr Bank,
Doncaster, DN4 8DH, England. The Notice of AGM will be posted to
shareholders on 5(th) July, 2022. The full Annual Report and
Accounts will be posted to shareholders in the week commencing
11(th) July, 2022. They will be made available on the Company's
website at www.msiplc.com and will be delivered to the Registrar of
Companies after it has been laid before the Company's members at
the Annual General Meeting to be held on 28(th) July, 2022 at The
Holiday Inn, Warmsworth, Doncaster.
Consolidated income statement
For the year ended 30th April, 2022
2022 2021
Continuing operations Total Total
GBP'000 GBP'000
Revenue 74,524 61,539
Cost of sales (54,121) (44,218)
---------------------------------------------------------------------------------------- --------- ---------
Gross profit 20,403 17,321
Distribution costs (3,304) (2,581)
Administrative expenses (12,097) (12,954)
O ther operating income 1,185 -
-------------------------------------------------------------------------------------
(14,216) (15,535)
--------- ---------
Group operating profit 6,187 1,786
Share of net profit of joint venture - 28
---------
Interest received 1 10
Interest paid (95) (92)
Other finance costs - pensions (126) (140)
---------
(220) (222)
--------- ---------
Profit before taxation 5,967 1,592
Taxation (1,035) (415)
---------------------------------------------------------------------------------------- --------- ---------
Profit for the year attributable to equity holders of the parent 4,932 1,177
---------------------------------------------------------------------------------------- --------- ---------
Basic earnings per share 30.9p 7.2p
Diluted earnings per share 29.6p 7.0p
Consolidated statement of comprehensive income
For the year ended 30th April, 2022
2022 2021
Total Total
GBP'000 GBP'000
Profit for the year attributable to equity holders of the parent 4,932 1,177
Exchange differences on retranslation of foreign operations (603) (38)
---------------------------------------------------------------------------------------- --------- ---------
Net other comprehensive loss to be reclassified to profit or loss in subsequent years (603) (38)
--------------------------------------------------------------------------------------- --------- ---------
Remeasurement gains on defined benefit pension scheme 1,601 1,213
Deferred tax on remeasurement on defined benefit scheme (145) (230)
Revaluation of land and buildings 3,868 -
Deferred tax on revaluation surplus on land and buildings (798) -
Net other comprehensive income not being reclassified to profit or loss in subsequent
years 4,526 983
--------------------------------------------------------------------------------------- --------- ---------
Total comprehensive income for the year attributable to equity holders of the parent 8,855 2,122
--------------------------------------------------------------------------------------- --------- ---------
Consolidated and company statement of changes in equity
For the year ended 30th April, 2022
Share Capital Other Revaluation Special Currency Treasury Retained Total
capital redemption reserves reserve reserve translation shares earnings shareholders'
reserve reserve funds
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
(a) Group
At 30th April,
2020 1,840 901 2,815 6,055 1,629 224 (3,059) 19,723 30,128
Profit for the
year - - - - - - - 1,177 1,177
Other
comprehensive
(loss)/income - - - - - (38) - 983 945
------- -------- -------- -------------
Total
comprehensive
(loss)/income - - - - - (38) - 2,160 2,122
Dividends paid - - - - - - - (578) (578)
Purchase of own
shares - - - - - - (636) - (636)
Cancellation of
shares (56) 56 - - - - 906 (906) -
--------------- ------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
At 30th April,
2021 1,784 957 2,815 6,055 1,629 186 (2,789) 20,399 31,036
Profit for the
year - - - - - - - 4,932 4,932
Other
comprehensive
income/(loss) - - - 3,868 - (603) - 658 3,923
------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
Total
comprehensive
income/(loss) - - - 3,868 - (603) - 5,590 8,855
Dividends paid - - - - - - - (1,316) (1,316)
---------------
At 30th April,
2022 1,784 957 2,815 9,923 1,629 (417) (2,789) 24,673 38,575
--------------- ------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
(b) Company
At 30th April,
2020 1,840 901 7,620 - 1,629 - (3,059) 15,618 24,549
Profit for the
year - - - - - - - 1,548 1,548
Other
comprehensive
income - - - - - - - 899 899
------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
Total
comprehensive
income - - - - - - - 2,447 2,447
Dividends paid
(note 10) - - - - - - - (578) (578)
Purchase of own
shares (note
22) - - - - - - (636) - (636)
Cancellation of
shares (56) 56 - - - - 906 (906) -
--------------- ------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
At 30th April,
2021 1,784 957 7,620 - 1,629 - (2,789) 16,581 25,782
Profit for the
year - - - - - - - 3,362 3,362
Other
comprehensive
income - - - - - - - 1,232 1,232
------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
Total
comprehensive
income - - - - - - - 4,594 4,594
Dividends paid - - - - - - - (1,316) (1,316)
---------------
At 30th April,
2022 1,784 957 7,620 - 1,629 - (2,789) 19,859 29,060
--------------- ------- ---------- -------- ----------- ------- ----------- -------- -------- -------------
Consolidated and company statements of financial position
At 30th April, 2022
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant and equipment 24,537 19,113 1,017 935
Right-of-use assets 1,479 530 5,029 5,486
Intangible assets 3,002 3,558 - -
Investments in subsidiaries - - 18,126 17,313
Investment in joint venture 34 36 - -
Deferred income tax asset 1,435 1,606 1,374 1,600
------------------------------------ -------- -------- --------
30,487 24,843 25,546 25,334
-------- -------- -------- --------
Current assets
Inventories 16,327 12,423 2,592 1,498
Trade and other receivables 11,396 9,369 15,394 16,135
Contract assets 1,773 1,998 - -
Income tax receivable 6 194 - 141
Prepayments 1,352 2,010 218 543
Cash and cash equivalents 18,092 17,390 3,258 943
Restricted cash held in Escrow 1,158 6,165 - -
------------------------------------ -------- -------- --------
50,104 49,549 21,462 19,260
-------- -------- -------- --------
TOTAL ASSETS 80,591 74,392 47,008 44,594
------------------------------------ -------- -------- -------- --------
EQUITY AND LIABILITIES
Equity
Share capital 1,784 1,784 1,784 1,784
Capital redemption reserve 957 957 957 957
Other reserves 2,815 2,815 7,620 7,620
Revaluation reserve 9,923 6,055 - -
Special reserve 1,629 1,629 1,629 1,629
Currency translation reserve (417) 186 - -
Treasury shares (2,789) (2,789) (2,789) (2,789)
Retained earnings 24,673 20,399 19,859 16,581
------------------------------------ -------- -------- -------- --------
TOTAL EQUITY SHAREHOLDERS' FUNDS 38,575 31,036 29,060 25,782
------------------------------------ -------- -------- -------- --------
Non-current liabilities
Defined benefit pension liability 4,720 7,095 4,720 7,095
Deferred income tax liability 2,578 1,553 - -
Lease liabilities 1,158 380 4,807 5,214
------------------------------------ -------- -------- -------- --------
8,456 9,028 9,527 12,309
-------- -------- -------- --------
Current liabilities
Trade and other payables 14,176 12,410 7,068 5,234
Contract liabilities 18,329 21,192 622 874
Income tax payable 702 561 324 -
Lease liabilities 353 165 407 395
------------------------------------ -------- -------- -------- --------
33,560 34,328 8,421 6,503
-------- -------- -------- --------
TOTAL EQUITY AND LIABILITIES 80,591 74,392 47,008 44,594
------------------------------------ -------- -------- -------- --------
Consolidated and company cash flow statements
For the year ended 30th April, 2022
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Profit before taxation 5,967 1,592 2,509 92
Adjustments to reconcile profit before taxation to cash
generated from operating activities:
Past service pension costs - 205 - 205
Depreciation charge of owned assets and right-of-use assets 1,746 1,666 931 895
Amortisation charge 227 237 - -
Impairment of goodwill 349 348 - -
Write off of acquired goodwill - 8 - -
Profit on sale of fixed assets (169) (74) (163) (61)
Share of net profit of joint venture - (28) - -
Termination of lease - (7) - -
Finance costs 220 222 292 366
Foreign exchange (losses)/gains (142) 516 - -
(Increase)/decrease in inventories (3,657) 3,377 (1,094) 44
(Increase)/decrease in receivables (1,541) (6,834) 19 37
Decrease/(increase) in prepayments 611 (237) 325 (246)
Increase in payables 1,340 1,162 1,518 1,296
(Decrease)/increase in progress payments (3,660) 7,824 (252) (163)
Pension fund payments (900) (600) (900) (600)
---------------------------------------------------------------- -------- -------- --------- ----------
Cash generated from operating activities 391 9,377 3,185 1,865
Net interest paid (43) (52) (1) (49)
Taxation (paid)/received (447) 460 151 -
---------------------------------------------------------------- -------- -------- --------- ----------
Net cash (outflow)/inflow from operating activities (99) 9,785 3,335 1,816
---------------------------------------------------------------- -------- -------- --------- ----------
Investing activities
Payments for acquisitions, net of cash acquired - (89) - -
Dividends received from subsidiaries - - 1,249 1,498
Purchase of property, plant and equipment (2,703) (781) (578) (268)
Purchase of intangible assets (54) - - -
Proceeds on disposal of property, plant and equipment 227 97 185 62
Decrease/(increase) in cash held in the Escrow account maturing
in more than 90 days 5,007 (6,165) - -
Net cash inflow/(outflow) from investing activities 2,477 (6,938) 856 1,292
---------------------------------------------------------------- -------- -------- --------- ----------
Financing activities
Purchase of own shares - (636) - (636)
Lease payments (405) (327) (560) (560)
Dividends paid (1,316) (578) (1,316) (578)
Net cash outflow from financing activities (1,721) (1,541) (1,876) (1,774)
---------------------------------------------------------------- -------- -------- --------- ----------
Increase in cash and cash equivalents 657 1,306 2,315 1,334
Opening cash and cash equivalents/(bank overdraft) 17,390 16,125 943 (391)
Exchange differences on cash and cash equivalents 45 (41) - -
Closing cash and cash equivalents 18,092 17,390 3,258 943
---------------------------------------------------------------- -------- -------- --------- ----------
The financial information set out above does not constitute the
Company's statutory accounts for the periods ended 30(th) April,
2022 or 30th April, 2021 but is derived from those accounts.
Statutory accounts for 2021 have been delivered to the Registrar of
Companies and those for 2022 will be delivered following the
Company's Annual General Meeting. The auditors have reported on
those accounts; their reports were unqualified and did not contain
a statement under section 498 (2) or (3) of the Companies Act
2006.
1. Segment information
The following table presents revenue and profit and certain assets and liability information
regarding the Group's divisions for the years ended 30th April, 2022 and 30th April, 2021.
The reporting format is determined by the differences in manufacture and services provided
by the Group. The 'Defence' division is engaged in the design, manufacture, and service of
defence equipment. The 'Forgings' division is engaged in the manufacture of forgings. The
'Petrol Station Superstructures' division is engaged in the design, manufacture, construction,
branding, maintenance, and restyling of petrol station superstructures. The 'Corporate Branding'
division is engaged in the design, manufacture, installation, and service of corporate brandings.
Management monitors the operating results of its business units separately for the purpose
of making decisions about resource allocation and performance assessment. Group financing
(including finance costs and finance revenue) and income taxes are managed on a group basis
and are therefore not allocated to operating segments.
'Defence' 'Forgings' 'Petrol Station 'Corporate Total
Superstructures' Branding'
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Segmental
revenue
Total revenue 30,219 27,078 16,482 9,970 15,143 11,774 13,009 12,972 74,853 61,794
Revenue from
other
segments - - - - (245) (145) (84) (110) (329) (255)
-------------- ------- ------- ------- ------- --------- ------- ------- ------- ------- -------
Revenue from
external
customers 30,219 27,078 16,482 9,970 14,898 11,629 12,925 12,862 74,524 61,539
-------------- ------- ------- ------- ------- --------- ------- ------- ------- ------- -------
Segment
result
Operating
profit 4,123 2,570 2,245 425 1,074 448 (1,255) (1,657) 6,187 1,786
Share of net
profit of
joint venture - 28
Net finance
costs (220) (222)
-------------- ------- -------
Profit before
taxation 5,967 1,592
Taxation (1,035) (415)
-------------- ------- -------
Profit for the
year 4,932 1,177
-------------- ------- -------
Segmental
assets
Assets
attributable
to segments 33,393 35,414 7,883 4,066 9,380 8,492 8,050 8,468 58,706 56,440
Unallocated
assets* 21,885 17,952
Total assets 80,591 74,392
-------------- ------- -------
Segmental
liabilities
Liabilities
attributable
to segments 23,643 24,795 3,547 2,445 3,109 2,970 3,591 3,510 33,890 33,720
Unallocated
liabilities * 8,126 9,636
-------------- ------- -------
Total
liabilities 42,016 43,356
-------------- ------- -------
Other
segmental
information
Capital
expenditure 1,933 440 389 24 195 131 186 186 2,703 781
Depreciation 210 176 561 545 714 377 261 263 1,746 1,361
Amortisation 10 - - - 43 55 174 182 227 237
Impairment - - - - - - 349 348 349 348
* Unallocated assets include certain fixed assets (including all UK properties), current assets
and deferred income tax assets. Unallocated liabilities include the defined pension benefit
scheme liability, the deferred income tax liability, and certain current liabilities.
Assets and liabilities attributable to segments comprise the assets and liabilities of each
segment adjusted to reflect the elimination of the cost of investment in subsidiaries and
the provision of financing loans provided by MS INTERNATIONAL plc.
Revenue between segments is determined on an arm's length basis. Segment results, assets,
and liabilities include items directly attributable to the segment as well as those that can
be allocated on a reasonable basis.
Geographical analysis
The following table presents revenue and expenditure and certain assets and liabilities information
by geographical segment for the years ended 30th April, 2022 and 30th April, 2021. The Group's
geographical segments are based on the location of the Group's assets.
United Kingdom Europe USA South America Total
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
External revenue by
origin 41,665 41,191 11,599 12,987 18,917 5,934 2,343 1,427 74,524 61,539
Non-current assets 20,160 17,373 4,327 3,706 5,913 3,751 87 13 30,487 24,843
Current assets 37,235 39,457 6,147 6,899 6,024 2,306 698 887 50,104 49,549
Liabilities 28,380 32,516 4,112 3,729 9,223 7,081 301 30 42,016 43,356
Capital expenditure 2,377 644 133 137 193 - - - 2,703 781
Revenue disaggregated by destination is shown as follows:
2022 2021
GBP'000 % GBP'000 %
United Kingdom 31,287 42% 22,259 36%
Europe 17,103 23% 26,574 43%
USA 19,406 26% 5,934 10%
South America 2,421 3% 1,427 2%
Rest of World 4,307 6% 5,345 9%
Total revenue 74,524 100% 61,539 100%
------------------------ --------- --------- ------- ------- ------- ------- ------- --------- --------- --------
The Group's largest customer, which is reported in the 'Defence'
division, contributed 14.2% to the Group's revenue (2021: 14.9% in
the 'Defence' division from a different customer). Only one other
customer, also in the 'Defence' division, contributed more than 10%
to the Group's revenue with a contribution of 11.4% (2021: 11.3% in
the 'Defence' division).
2. Other operating income
2022 2021
GBP'000 GBP'000
Settlement of contractual dispute 1,185 -
------------------------------------------------------------------- --------- --------- -------- --------
1,185 -
------------------------------------------------------------------- --------- --------- -------- --------
During the year, the Group settled a protracted contractual dispute, the terms of which are
confidential. The amount received has been recognised in other income. The Group has incurred
GBP0.6m of legal costs in the current year in relation to this matter. These costs are included
in administrative expenses.
2. Employee information
The average number of employees, including executive directors,
during the year was as follows:
Group Company
2022 2021 2022 2021
Number Number Number Number
Production 252 243 74 73
Technical 71 72 23 24
Distribution 26 32 2 5
Administration 98 96 39 32
-------------------------------------------------------------------- --------- --------- -------- --------
447 443 138 134
--------- --------- -------- --------
(a) Staff costs
Including executive directors, employment costs were as
follows:
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Wages and salaries 18,942 17,420 7,139 6,123
Covid-19 job retention scheme income (1,636) (1,690) - (313)
Social security costs 3,233 3,263 722 647
Pension costs 570 557 352 344
Share options expense 29 29 29 29
-------------------------------------------------------------------- --------- --------- -------- --------
21,138 19,579 8,242 6,830
--------- --------- -------- --------
The Covid-19 job retention scheme income has been received in the following countries:
2022 2021
GBP'000 GBP'000
UK - 313
The Netherlands 1,310 1,113
USA 251 254
Poland 75 10
--------- ---------
1,636 1,690
------------------------------------------------------------------- --------- --------- -------- --------
(b) Directors' emoluments
2022 2021`
GBP'000 GBP'000
Aggregate directors' emoluments 1,810 1,570
Pension contributions 52 42
-------------------------------------------------------------------- --------- --------- -------- --------
1,862 1,612
------------------------------------------------------------------- --------- --------- -------- --------
3. (a) Taxation
The charge for taxation comprises:
2022 2021
GBP'000 GBP'000
Current tax
United Kingdom corporation tax 667 410
Adjustments in respect of previous years (10) 25
Foreign corporation tax 120 30
--------------------------------------------------------------------- -------- --------
Group current tax expense 777 465
--------------------------------------------------------------------- -------- --------
Deferred tax
Origination and reversal of temporary differences 261 (40)
Adjustments in respect of previous years (5) (10)
Adjustments in respect of difference in applicable tax rate 2 -
-------------------------------------------------------------------- -------- --------
Group deferred tax expense/(credit) 258 (50)
--------------------------------------------------------------------- -------- --------
Total tax expense on profit 1,035 415
--------------------------------------------------------------------- -------- --------
Tax relating to items charged to other comprehensive income:
2022 2021
GBP'000 GBP'000
Deferred tax charged through other comprehensive income
Deferred tax on measurement gains on pension scheme current year (145) (230)
Deferred tax on revaluation surplus on land and buildings (798) -
Deferred tax in the Consolidated statement of comprehensive income (943) (230)
--------------------------------------------------------------------- -------- --------
(b) Factors affecting the tax charge for the year
The tax charge assessed for the year is lower than (2021: higher than) the standard rate of
corporation tax in the UK of 19% (2021 - 19%). The differences are explained below:
2022 2021
GBP'000 GBP'000
Profit before tax 5,967 1,592
-------------------------------------------------------------------------- -------- ----------
Profit multiplied by standard rate of corporation tax of 19% (2021 - 19%) 1,134 302
Effects of:
Expenses not deductible for tax purposes (247) (164)
Adjustments in respect of overseas tax rates 161 262
Current tax adjustment in respect of previous years (10) 25
Deferred tax adjustment in respect of previous years (5) (10)
Deferred tax adjustment in respect of different applicable rates 2 -
-------------------------------------------------------------------------- -------- ----------
Total taxation expense for the year 1,035 415
-------------------------------------------------------------------------- -------- ----------
(c) Factors affecting future tax charge
The rate of corporation tax in the UK will remain at 19% until April 2023 when it will increase
to 25%. As the changes have been enacted as at 30th April, 2022, deferred income tax has been
provided at 25% or a blended rate depending upon when the underlying temporary timing differences
are expected to unwind.
Deferred tax in relation to intangibles recognised on the acquisition of 'MSI-Sign Group B.V.'
has been provided at 25.8%, being the main corporation tax rate in The Netherlands.
4. Earnings per share
The calculation of basic earnings per share of 30.9p (2021 - 7.2p) is based
on the profit for the year attributable to equity holders of the parent of
GBP4,932,000 (2021 - GBP1,177,000) and on a weighted average number of ordinary
shares in issue of 15,949,691 (2021 - 16,342,816). At 30th April, 2022 there
were 1,055,000 (2021 - 380,000) dilutive shares on option with a weighted
average effect of 716,575 (2021 - 391,667) giving a diluted earnings per share
of 29.6p (2021 - 7.0p).
2022 2021
Number of ordinary shares in issue at start of the year 17,841,073 18,396,073
Cancellation of ordinary shares during the year - (555,000)
------------------------------------------------------------ ------------ ------------
Number of ordinary shares in issue at the end of the year 17,841,073 17,841,073
------------------------------------------------------------ ------------ ------------
Weighted average number of shares in issue 17,841,073 18,234,198
Less weighted average number of shared held in the ESOT (245,048) (245,048)
Less weighted average number of shares purchased by the
Company (1,646,334) (1,646,334)
------------------------------------------------------------ ------------ ------------
Weighted average number of shares to be used in basic
EPS calculation 15,949,691 16,342,816
Weighted average number of the 1,055,000 (2021 - 380,000)
dilutive shares 716,575 391,667
Weighted average diluted shares 16,666,266 16,734,483
------------------------------------------------------------ ------------ ------------
Profit for the year attributable to equity holders to
the parent in GBP 4,932,000 1,177,000
Basic earnings per share 30.9p 7.2p
Diluted earnings per share 29.6p 7.0p
5. Dividends paid and proposed 2022 2021
GBP'000 GBP'000
Declared and paid during the year
Final dividend for 2021: 6.50p (2020 - 1.75p) 1,037 289
Interim dividend for 2022: 1.75p (2021 - 1.75p) 279 289
------------------------------------------------------------ ------------
1,316 578
------------ ------------
Proposed for approval by shareholders at the AGM
Final dividend for 2022: 7.5p (2021- 6.5p) 1,196 1,037
------------------------------------------------------------ ------------ ------------
6. Trade and other receivables
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Trade receivables (net of allowance for expected credit
losses) 10,167 8,764 2,366 2,184
Amounts owed by subsidiary undertakings - - 13,024 13,872
Amounts owed by joint venture 228 130 - -
Other receivables 1,001 475 4 79
--------
11,396 9,369 15,394 16,135
-------- -------- -------- ---------
(a) Trade receivables
Trade receivables are denominated in the following currencies:
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Sterling 5,554 6,112 1,576 1,675
Euro 1,786 1,692 790 509
US dollar 2,406 695 - -
Other currencies 421 265 - -
------------------------------------------------------------ -------- ---------
10,167 8,764 2,366 2,184
-------- -------- -------- ---------
Trade receivables are non-interest bearing, generally have 30 day terms, and are shown net
of provision for expected credit losses. The aged analysis of trade receivables after provision
for expected credit losses is as follows:
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Not past due 7,234 7,268 2,316 2,033
< 30 days 2,062 1,381 24 122
30-60 days 64 102 19 28
60-90 days 11 28 8 -
> 90 days 796 (15) (1) 1
------------------------------------------------------------ -------- -------- -------- ---------
Total 10,167 8,764 2,366 2,184
------------------------------------------------------------- -------- -------- -------- ---------
In the Group, trade receivables with a nominal value of GBP52,000 (2021 - GBP43,000) were
impaired and fully provided as at 30th April, 2022. During the year, bad debts of GBP20,000
(2021 - GBP81,000) were recovered and bad debts of GBP29,000 (2021 - GBP16,000) were incurred.
In the Company, trade receivables with a nominal value of GBP33,000 (2021 - GBP11,000) were
impaired and fully provided as at 30th April, 2022. During the year, bad debts of GBP7,000
(2021 - GBP69,000) were recovered and bad debts of GBP29,000 (2021 - GBP7,000) were incurred.
(b) Amounts owed by joint venture
Amounts owed by joint venture are non-interest bearing and have 30 day terms. The aged analysis
of amounts owed by joint venture net of provision for expected credit losses as follows:
Group
2022 2021
GBP'000 GBP'000
Not past due 135 50
< 30 days 47 33
30-60 days 34 41
60-90 days 12 6
------------------------------------------------------------ -------- -------- -------- ---------
Total 228 130
------------------------------------------------------------- -------- -------- -------- ---------
At 30th April, 2022 there was no provision for expected credit losses relating to amounts
owed by joint venture (2021 - nil).
(c) Intercompany receivables
All amounts due from Group companies are repayable on demand and are not charged interest.
The majority of intercompany balances are to group entities with liquid assets and are capable
of being repaid on demand. There has been no impairment recognised on intercompany receivables
(2021 - nil).
There are loans to 'MS INTERNATIONAL Estates Limited', which although repayable on demand,
are supported by properties, which will not be immediately realisable. The directors have
assessed the likelihood of default and the loss in the event of default as well as the balance
at the reporting date and conclude that there is no material impairment of the receivable.
The amounts receivable at the reporting date can be categorised as:
Company
2022 2021
GBP'000 GBP'000
Amounts due from companies backed by liquid assets 7,099 7,587
Amounts due from 'MS INTERNATIONAL Estates Limited' 5,925 6,285
--------------------------------------------------------------------------------- -------- ---------
13,024 13,872
7. Cash and cash
equivalents
Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Cash at bank and in hand 18,092 17,390 3,258 943
Restricted cash held in
Escrow - maturing in
more than 90 days 1,158 6,165 - -
Total cash 19,250 23,555 3,258 943
The balance held in Escrow provides security to Lloyds Bank plc in respect of any guarantees,
indemnities, and performance bonds given by the Group in the ordinary course of business.
8. Net funds
Analysis of net funds Group Company
2022 2021 2022 2021
GBP'000 GBP'000 GBP'000 GBP'000
Cash and cash equivalents 18,092 17,390 3,258 943
Restricted cash held in
Escrow 1,158 6,165 - -
Lease liabilities (1,511) (545) (5,214) (5,609)
17,739 23,010 (1,956) (4,666)
Group movement in net
funds
Cash and cash Restricted cash held Lease liabilities Total
equivalent in Escrow
At 30th April, 2020 16,125 - (1,229) 14,896
Cash flows 1,306 6,165 327 7,798
Foreign exchange
adjustments (41) - (16) (57)
Leases on acquisition - - 402 402
Other changes - - (29) (29)
At 30th April, 2021 17,390 6,165 (545) 23,010
Cash flows 657 (5,007) 405 (3,945)
Foreign exchange
adjustments 45 - 7 52
New leases - - (1,327) (1,327)
Other changes - - (51) (51)
At 30th April, 2022 18,092 1,158 (1,511) 17,739
Company movement in
net funds
Cash and cash Lease liabilities Total
equivalents
At 30th April, 2020 (391) (5,992) (6,383)
Cash flows 1,334 560 1,894
Other changes - (177) (177)
At 30th April, 2021 943 (5,609) (4,666)
Cash flows 2,315 560 2,875
Other changes - (165) (165)
At 30th April, 2022 3,258 (5,214) (1,956)
9. Reserves
Share capital
The balance classified as share capital includes the nominal value on issue of the Company's
equity share capital, comprising 10p ordinary shares.
Capital redemption reserve
The balance classified as capital redemption reserve represents the nominal value of issued
share capital of the Company, repurchased.
Other reserves
Following the transfer of assets held at valuation by the Company to a subsidiary company,
a reserve has been created which is non-distributable. This is equal to the revaluation reserve
previously arising.
Additionally, it includes the non-distributable retained reserve for the revaluation reserve
previously showing in the Company for properties now transferred to other members of the Group.
Revaluation reserve
The asset revaluation reserve is used to record increases in the fair value of land and buildings
and decreases to the extent that such decrease relates to an increase on the same assets
previously
recognised in equity.
Special reserve
The special reserve is a distributable reserve created following the cancellation of a share
premium account by way of court order in March 1993.
Currency translation reserve
The foreign currency translation reserve is used to record exchange differences arising from
the translation of the financial statements of foreign subsidiaries. It is also used to record
the effect of hedging net investments in foreign operations.
Treasury shares
The treasury share reserve is detailed as follows:
2022 2021
GBP'000 GBP'000
Employee Share Ownership Trust 100 100
Shares in treasury (see below) 2,689 2,959
2,789 3,059
The Employee Share Ownership Trust ("ESOT") provides for the issue of options over ordinary
shares in the Company to Group employees, including executive directors, at the discretion
of the Remuneration Committee. The trustee of the ESOT is Appleby Trust (Jersey) Ltd, an
independent
company registered in Jersey.
The trust has purchased an aggregate 245,048 (2021 - 245,048) ordinary shares, which represents
1.5% (2021 - 1.5%) of the issued share capital of the Company at an aggregate cost of GBP100,006.
The market value of the shares at 30th April, 2022 was GBP728,000 (2021 - GBP380,000). The
Company has not made any payments (2021 - nil) into the ESOT bank accounts during the year.
Details of the outstanding share options for directors are included in the Directors' remuneration
report.
The assets, liabilities, income, and costs of the ESOT have been incorporated into the Company's
financial statements. Total ESOT costs charged to the income statement in the year amounts
to GBP1,000 (2021 - GBP3,000). During the year, no options have been granted over shares (2021
- nil), no options on shares were exercised (2021 - nil) and no shares were purchased (2021
- nil).
The Company made the following purchases and cancellations of its own 10p ordinary shares
to be held in Treasury:
Number GBP'000
Purchase of 1,000,000 shares from the Group's pension scheme on 11th
December, 2013 1,000,000 1,722
Purchase of 646,334 shares on 30th January, 2014 646,334 1,237
Purchase of 555,000 shares on 15th January, 2021 555,000 636
Consideration paid for purchase of own shares 2,201,334 3,595
Cancellation of 555,000 shares at weighted average rate (555,000) (906)
Net value of treasury shares 1,646,334 2,689
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END
FR SEDFUWEESESM
(END) Dow Jones Newswires
June 28, 2022 02:26 ET (06:26 GMT)
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