Robinson
plc
Interim Results for the six
months ended 30 June 2024
and
Appointment of
CEO
Robinson plc ("Robinson" the
"Company" or the "Group" stock code: RBN), the custom manufacturer
of plastic and paperboard packaging based in Chesterfield,
announces its interim results for the six months ended 30 June
2024.
Financial
·
Revenue up 11% to £27.1m (2023: £24.3m)
·
Gross margin higher than the prior year at
21% (H1 2023:
18%)
·
Operating profit before exceptional items and
amortisation of intangible assets increased to £1.6m (2023: £0.5m)
·
Exceptional costs of £0.1m (2023: £0.5m)
·
Profit before tax of £0.7m (2023: loss of £0.9m)
·
Interim dividend of 2.5p per share announced (2023:
2.5p)
·
Net debt of £7.9m (31/12/2023: £6.3m), after
capital expenditure of £1.9m
Operational
·
John Melia to be appointed as Group CEO following
thorough recruitment and selection process
·
Large project in Denmark now supplying substantial
volumes
·
Doubled PET bottle capacity in UK business and
implemented new business projects
·
Progress on ratio of recycled material content in
our packaging to 24% (2023: full year 18%)
Alan Raleigh, Chairman,
commented:
"The results for the first half of
2024 reflect the positive momentum that we have experienced since
July 2023. Whilst market conditions remain challenging, I am very
pleased that our approach to partnering with major fast moving
consumer goods ("FMCG") brand owners, our investment in new
technology and our ability to deliver packaging made from
post-consumer recycled material is delivering increased sales
volume and improved performance.
I
am delighted that John Melia has chosen to join Robinson as our new
Chief Executive. John is currently Director of Strategy and
Innovation at DS Smith Recycling and has held senior positions at
Tata Chemicals, where he oversaw major business transformation
initiatives. He has an in-depth understanding of what is
required to drive shareholder value in a business like Robinson and
we look forward to him joining the team in December. I would also
like to place on record the Board's appreciation for the excellent
contribution that Sara Halton has made as interim Chief
Executive.
The Company expects revenue and profit for the 2024 financial
year to be in line with current market expectations. We remain
committed in the medium-term to delivering above-market profitable
growth and our target of 6-8% adjusted operating
margin*."
*Operating profit margin before
amortisation of intangible assets and exceptional items
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Robinson plc
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www.robinsonpackaging.com
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Sara Halton, Interim CEO
Mike Cusick, Finance
Director
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Tel: 01246 389280
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Cavendish Capital Markets
Limited
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Ed Frisby / Seamus Fricker, Corporate
Finance
Tim Redfern, Corporate
Broking
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Tel: 020 7220
0500
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INFORMATION REQUIRED UNDER RULE 17 AND SCHEDULE 2, PARAGRAPH
(G) OF THE AIM RULES FOR COMPANIES ("AIM RULES")
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Full name:
|
John Stephen Melia
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Age:
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53
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RBN shares held:
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None
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Current directorships:
|
DS Smith Recycling Ireland
Limited
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Historic directorships in previous 5
years:
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DS Smith Recycling UK
Limited
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There is no further information to
be disclosed in relation to the appointment of John Melia pursuant
to Rule 17 and Schedule 2, paragraph (g) of the AIM
Rules.
About Robinson:
Being a purpose-led business,
Robinson specialises in custom packaging with technical and
value-added solutions for food and consumer product hygiene,
safety, protection, and convenience; going above and beyond to
create a sustainable future for our people and our planet. Its main
activity is in injection and blow moulded plastic packaging and
rigid paperboard luxury packaging, operating within the food and
beverage, homecare, personal care and beauty, and luxury gift
sectors. Robinson provides products and services to major players
in the fast-moving consumer goods market including Procter &
Gamble, Reckitt Benckiser, SC Johnson and Unilever.
Headquartered in Chesterfield, UK,
Robinson has plants in the UK, Poland and Denmark. Robinson was
formerly a family business with its origins dating back to 1839,
currently employing nearly 400 people. The Group also has a
substantial property portfolio with development
potential.
Chairman's Statement
Dear Shareholders
The results for the first half of
2024 reflect the positive momentum that we have experienced since
July 2023. Whilst market conditions remain challenging, I am very
pleased that our approach to partnering with major FMCG brand
owners, our investment in new technology and our ability to deliver
packaging made from post-consumer recycled material is delivering
increased sales volume and improved performance.
Sales in the first half of the year
are 11% above the comparative period in 2023. After adjusting for
price changes and foreign exchange, sales volumes were 14% higher.
Although the comparative reflects the cost-of-living crisis in 2023
and a major customer experiencing a supply chain issue, volumes in
2024 have benefitted from new business projects introduced in the
last 12 months, including the previously announced large new
project in Denmark. With a strong pipeline of further projects, we
are well positioned for future sales growth.
The operational gearing effect of
14% higher sales volumes and lower rate of input cost inflation
have led to improved gross margins of 21% (H1 2023: 18%) in the
period. This is despite experiencing start-up issues with
production on the project in Denmark which has led to higher direct
costs in the short term.
Operating costs in the first half
were £4.0m (2023: £4.0m) which was in line with 2023 and
includes:
·
£0.2m of inflation in wages and salaries in
response to market inflation and substantial mandatory minimum wage
increases across our three countries of operation.
·
£0.1m of additional costs incurred in Denmark as
part of the introduction of the large new business
project.
·
Offset by the remaining £0.3m annual benefit of
the restructuring program actioned in June 2023.
Operating profit before exceptional
items and amortisation of intangible assets increased to £1.6m
compared to the prior year (2023: £0.5m).
Including the exceptional items of
£0.1m related to the ongoing costs of surplus property disposals
and the closure of the defined benefit pension scheme, the Group
made a profit before tax of £0.7m (2023: loss before tax
£0.9m).
We have made important progress on
raising our level of recycled material content; in the first half
of the year 24% of material processed was from recycled sources
(2023: full year 18%). Excluding products for food contact, where
there is restrictive legislation, 32% of material processed was
recycled material (2023: full year 24%). We expect that our
pipeline of new projects will support a further increase in this
ratio.
We continue to work with insurers on
the reinstatement of the Paperbox business and the property in
Chesterfield following the serious flood in October 2023. The
offices refurbishment is expected to take a further six months, but
the Paperbox business is close to full
operation, with a healthy sales pipeline.
CEO position
I am very pleased to announce that
John Melia has agreed to join the Company and Board as Chief
Executive Officer, effective 1 December 2024.
John is an accomplished business
leader who has a track record of delivery at senior level across
both SMEs and multinational businesses. He brings extensive
experience of business development, operational performance
improvement, a deep understanding of the circular economy and
significant manufacturing expertise.
John is currently Director of
Strategy and Innovation at DS Smith Recycling and has held senior
positions at Tata Chemicals, where he oversaw major business
transformation initiatives. John has an MEng in Chemical
Engineering from the University of Cambridge.
Sara Halton, who has served as
Robinson plc Interim Chief Executive Officer since September 2023,
will step down from that position and return to her Non-Executive
Director role also effective 1 December 2024.
Defined benefit pension
scheme
In December 2022, the Robinson &
Sons' Limited Pension Fund (the "Scheme") completed a buy-in of all
the Group's defined benefit pension scheme liabilities with a plan
to complete a full buy-out. A data cleanse exercise was completed,
the administration and payroll functions were handed over to Legal
and General Assurance Society Limited ("L&G") from 1 August
2023 and a final balancing payment of £0.1m, was made by L&G to
the Scheme on 19 February 2024, completing the buy-in process. A
full buy-out is expected to be completed before the end of 2024,
which will incur additional exceptional costs of up to £0.2m,
whilst these costs are incurred and paid by the Scheme they are
accounted for in the Company under IAS19. The £3.4m surplus
remaining in the Scheme after buy-out costs, will be used to
augment member benefits. In 2023, the Company reached agreement
with the trustees of the Scheme for the funds held in the pension
escrow account, totalling c.£3.3m, to be returned to the Group of
which, £2.7m was already loaned to the Company. Those funds were
received and used to reduce net indebtedness.
Property
We are continuing to pursue the sale
of surplus properties in Chesterfield. Based on professional
independent valuations, the Directors estimate that the current
market value of those properties is approximately £7.4m, and this
includes the previously announced c.1.3 acres of Walton Works where
exchange of contracts has occurred, and completion remains subject
to satisfactory planning approval. The surplus properties and other
UK land and buildings are pledged as security for Group credit
facilities, of which £3.8m was drawn on 30 June 2024.
Subject to the necessary planning
approvals, we would expect further sales of surplus property to be
achieved in the next 12 months. The intention of the Group remains,
over time, to realise value from the disposal of surplus properties
and use the proceeds to reduce indebtedness and develop our
packaging business.
Net debt and capital
expenditure
Net debt has increased to £7.9m
(31/12/2023: £6.3m) including capital expenditure of £1.9m (2023:
£1.1m). With total credit facilities of £14.1m at 30 June 2024, the
Group considers it has sufficient headroom for the foreseeable
future.
Dividend
The Board has confidence in the
medium-term prospects for the business and therefore announces that
it intends to pay an interim dividend of 2.5p per share to be paid
on 13 October 2024 to shareholders on the register at 20 September
2024 (record date). The ordinary shares ex-dividend date is 19
September 2024.
The current intention of the Board
is to pay a total dividend of 5.5p (2023: 5.5p) per share for the
year ending 31 December 2024.
Outlook
The Company expects revenue and
profit for the 2024 financial year to be in line with current
market expectations.
Our close partnerships with major
customers have led to a significantly improved sales pipeline,
which will lead to growth opportunities in future years. We will
continue to focus on improving profitability across our operations
as the effects of inflation subside and our premium brand owner
customers respond to the new market situation.
We are progressing our surplus
property disposal agenda, which along with the buy-out of the
defined benefit pension scheme will reduce indebtedness and result
in a simpler and more streamlined organisation which is able to
compete and win in a volatile marketplace.
We remain committed in the
medium-term to delivering above-market profitable growth and our
target of 6-8% adjusted operating margin*.
Alan Raleigh
Chairman
14 August 2024
*Operating profit margin before
amortisation of intangible assets and exceptional items
|
Condensed consolidated income statement and statement of
comprehensive income
|
|
|
|
|
|
|
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Condensed consolidated income statement
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£'000
|
Six months
to 30.06.24
|
Six
months
to 30.06.23
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Year
to
31.12.23
|
|
|
|
|
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Revenue
|
|
27,137
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24,348
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49,670
|
|
Cost of sales
|
|
(21,512)
|
(19,911)
|
(40,039)
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Gross profit
|
|
5,625
|
4,437
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9,631
|
|
Operating costs
|
|
(3,987)
|
(3,968)
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(7,420)
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|
Operating profit before amortisation of intangible assets and
exceptional items
|
1,638
|
469
|
2,211
|
|
Amortisation of intangible
assets
|
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(506)
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(476)
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(990)
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Exceptional items
|
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(86)
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(492)
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(1,116)
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|
Operating profit/(loss)
|
|
1,046
|
(499)
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105
|
|
Finance income - interest
receivable
|
|
18
|
4
|
40
|
|
Finance costs
|
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(405)
|
(379)
|
(805)
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Profit/(loss) before taxation
|
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659
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(874)
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(660)
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Taxation
|
|
(205)
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(33)
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(160)
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Profit/(loss) for the period
|
|
454
|
(907)
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(820)
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|
|
|
|
|
|
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Earnings per ordinary share (EPS)
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|
p
|
p
|
p
|
|
Basic and diluted earnings per
share
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2.7
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(5.4)
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(4.9)
|
|
|
|
|
|
|
|
Condensed consolidated statement of comprehensive
income
|
£'000
|
Six months
to 30.06.24
|
Six
months
to 30.06.23
|
Year
to
31.12.23
|
|
|
|
|
|
|
|
Profit/(loss) after tax for the period
|
|
454
|
(907)
|
(820)
|
|
Items that will not be reclassified subsequently to the Income
Statement:
|
|
|
|
|
|
Re-measurement of net defined
benefit liability
|
|
62
|
99
|
289
|
|
Deferred tax relating to items not
reclassified
|
|
(16)
|
(19)
|
(68)
|
|
Return of pension escrow
|
|
-
|
-
|
3,290
|
|
Deferred tax on pension
escrow
|
|
-
|
-
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(774)
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|
|
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46
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80
|
2,737
|
|
Items that may be reclassified subsequently to the Income
Statement:
|
|
|
|
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Exchange differences on
retranslation of foreign currency goodwill and
intangibles
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(65)
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(17)
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44
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Exchange differences on
retranslation of foreign currency deferred tax balances
|
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8
|
7
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3
|
|
Exchange differences on translation
of foreign operations
|
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(226)
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198
|
527
|
|
|
|
(283)
|
188
|
574
|
|
Other comprehensive (expense)/income
for the period
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|
(237)
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268
|
3,311
|
|
Total comprehensive (expense)/income for the
period
|
217
|
(639)
|
2,491
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Notes to the condensed consolidated financial
statements
1. Basis of
preparation
Robinson plc (the
Company) is a public limited company incorporated and
domiciled in the United Kingdom and its ordinary shares are
admitted to trading on the AIM market of the London Stock Exchange.
For the year ended 31 December 2023, the Group prepared
consolidated financial statements in accordance with UK-adopted
international accounting standards in conformity with the
requirements of the Companies Act 2006. These condensed
consolidated interim financial statements (the interim financial
statements) have been prepared under the historical cost convention
adjusted for the revaluation of certain properties. They are based
on the recognition and measurement principles of IFRS in accordance
with international accounting standards in conformity with the
requirements of the Companies Act 2006.
Standards effective from 1 January 2024
None of the standards,
interpretations, and amendments effective for the first time from 1
January 2024 have had a material effect on the financial
statements. There are no standards that are not yet effective and
that would be expected to have a material impact on the Group in
the current or future reporting periods and on foreseeable future
transactions.
Accounting policies
The interim report is unaudited and
has been prepared on the basis of IFRS accounting policies. The
accounting policies adopted in the preparation of this unaudited
interim financial report are consistent with the most recent annual
financial statements, being those for the year ended 31 December
2023. The financial information for the six months ended 30 June
2024 and 30 June 2023 has not been audited and does not constitute
full financial statements within the meaning of Section 434 of the
Companies Act 2006.
The financial information relating
to the year ended 31 December 2023 does not constitute full
financial statements within the meaning of Section 434 of the
Companies Act 2006. This information is based on the Group's
statutory accounts for that period. The statutory accounts were
prepared in accordance with UK-adopted international accounting
standards in conformity with the requirements of the Companies Act
2006 and received an unqualified audit report and did not contain
statements under Section 498(2) or (3) of the Companies Act 2006.
These financial statements have been filed with the Registrar of
Companies, a copy is available upon request from the Company's
registered office: Field House, Wheatbridge, Chesterfield, S40 2AB,
UK or from its website at robinsonpackaging.com.
Going concern
The Directors have performed a
robust assessment, including a review of the forecast for the
12-month period ending 31 December 2024 and longer-term strategic
forecasts and plans, including consideration of the principal risks
faced by the Group including stress testing of the business, as
detailed in the 2023 Annual Report (page 73). Following this
review, the Directors have a reasonable expectation that the Group
has adequate resources to continue in business for the foreseeable
future. Thus, they continue to adopt the going concern basis of
accounting in preparing the condensed consolidated financial
statements.
2. Accounting estimates and
judgements
The preparation of half year
financial statements requires management to make judgements,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets and liabilities, income
and expenses. Actual results may differ from these
estimates.
The significant judgements made by
management in applying the Group's accounting policies and the key
sources of estimation uncertainty were the same as those applied to
the consolidated financial statements as at and for the year ended
31 December 2023.
3. Risks and
uncertainties
The principal risks and
uncertainties which may have the largest impact on performance in
the second half of the year are the same as disclosed in the 2023
Annual Report on pages 18-19. The principal risks set out in the
2023 Annual Report were: Investment; Customers; Raw material supply
and input prices; IT and digital security; Environment; People; and
Supply Continuity.
The Board considers that the
principal risks and uncertainties set out in the 2023 Annual Report
have not changed and remain relevant for the second half of the
financial year.
4. Earnings per
share
The calculation of basic and diluted
earnings per ordinary share for continuing operations shown on the
income statement is based on the profit for the period divided by
the weighted average number of shares in issue, net of treasury
shares. The potentially dilutive effect of further shares issued
through share options is also applied to the number of shares to
calculate the diluted earnings per share.
|
|
Six months to
30.06.24
|
Six months
to 30.06.23
|
Year to
31.12.23
|
|
|
|
|
|
|
Profit/(loss) for the period
(£'000)
|
454,000
|
(907,000)
|
(820,000)
|
|
|
|
|
|
|
Weighted average number of ordinary
shares in issue
|
16,753,445
|
16,753,445
|
16,753,445
|
|
Effect of dilutive share option
awards*
|
-
|
-
|
-
|
|
Weighted average number of ordinary
shares for calculating diluted earnings per share
|
16,753,445
|
16,753,445
|
16,753,445
|
|
|
|
|
|
|
Basic earnings/(loss) per share
(pence)
|
2.7
|
(5.4)
|
(4.9)
|
|
Diluted earnings/(loss) per share
(pence)
|
2.7
|
(5.4)
|
(4.9)
|
*In the six months to 30.06.24 and
six months to 30.06.23 there was no difference in the weighted
average number of shares used for the calculation of basic and diluted earnings per share as all the
share options outstanding were out-of-the-money and not
dilutive.
5. Dividends
|
|
|
£'000
|
Six months
to 30.06.24
|
Six
months
to 30.06.23
|
Year
to
31.12.23
|
|
Ordinary dividend paid:
|
2022 final of 3.0p per
share
|
|
-
|
-
|
490
|
|
|
2023 interim of 2.5p per
share
|
|
-
|
-
|
408
|
|
|
2023 final of 3.0p per
share
|
|
490
|
-
|
-
|
|
|
|
|
490
|
-
|
898
|
The 2023 final dividend of 3.0p
(2023: 3.0p) per share was paid to shareholders on 21 June 2024. An
interim dividend of 2.5p (2023: 2.5p) is proposed to be paid on 11
October 2024. Neither the final nor interim dividend have been
included as a liability in the financial statements.
6. Interim
report
Electronic copies of this interim
report will be sent on 15 August 2024 to those shareholders who
have requested such copies and this interim report is also
available from Robinson plc's website at robinsonpackaging.com.
