Key points:
|
|
Interim 2018 |
Interim 2017 |
|
|
Revenue |
£53.2m |
£51.2m |
3.8% increase |
|
Operating profit |
£7.8m |
£7.8m |
0.7% increase |
|
Profit before tax |
£7.9m |
£7.8m |
0.9% increase |
|
Basic earnings per share |
5.43p |
5.38p |
0.9% increase |
· Performance of most Group companies was similar to the record figures of 2017
· Famostar acquisition completed in December for initial consideration of €7.6m
· Interim dividend increased to 1.40p (Interim 2017: 1.35p)
CHAIRMAN'S INTERIM STATEMENT
The Group started this financial year reasonably well, and at the halfway point had increased revenues by 3.8% and operating profit by 0.7%. Order income did not reach the record highs of 2016/17, making a further record-breaking full year result a challenge, as indicated in my update at the time of our AGM in November 2017.
Following the rebranding of Compact Lighting as Thorlux, Thorlux now has the benefit of additional retail revenue, which is now making a small contribution. Elsewhere, the majority of Group businesses performed in line with or ahead of last year, with the exception of TRT, where orders increased but margins reduced due to market pressure on selling prices. Improvements at TRT are underway for the second half of this financial year.
Certain overseas operations performed well, with a particularly positive contribution from those in the UAE and Australia. Lightronics delivered a large-scale project in Rotterdam and its performance is in line with that of last year.
Famostar, an emergency lighting specialist in the Netherlands, was welcomed to the Group. Within the Group, we see this as a complementary addition to the Lightronics operation, improving Lightronics' product offering and giving the opportunity to share Group technology in the future.
Having completed the new TRT factory and surface mount technology (SMT) electronics assembly line, the Group is now turning its attention to other areas. In January, the Group acquired the Lightronics factory and neighbouring property for €3.4m, providing a stable footing for expansion. On this site, the Group plans to build its European Application Centre, similar to the very successful Thorlux centre in the UK. It will showcase Lightronics, Thorlux and other Group products and systems.
Product development is a foundation of all Group businesses and continues apace. At Thorlux, additional SmartScan wireless lighting system features were launched, as planned. In addition, a raft of new and improved luminaires will appear on individual business websites before the end of the current financial year.
The results for the six months to 31 December 2017 allow for an increased dividend of 1.40p (Interim 2017: 1.35p), representing a 3.7% increase.
It remains a challenge to maintain last year's result, in spite of the interim performance. Revenue and profits should be bolstered by the addition of Famostar in the second half of the year; however, whilst the Group will endeavour to reach record levels, it seems unlikely.
Within the Group we will, of course, continue to work on and invest in projects that support our vision of stable long-term growth into the future.
Mike Allcock
Chairman
15 March 2018
F W Thorpe Plc