William Ransom & Son plc

Interim results for the six months to 30 September 2003 - Busines transformation process continues

    London (ots) - William Ransom & Son plc, the natural healthcare company, announced today a pre-tax profit before amortisation of goodwill of £0.055m in its interim results to 30 September 2003 (pre-tax loss of £0.095m after amortisation of goodwill). The Directors have declared a dividend of 0.50p.

    In summary:

    ·  Turnover declined by 1.6% to £6.731 million (2002 £6.842m).

    ·  Profit before tax and amortisation of goodwill was £0.055m
         (pre-tax loss of £0.095m after amortisation of goodwill),
         compared to a pre-tax profit before tax and amortisation of
         goodwill of £0.056m in the first half last year.

    ·  Discussions with developers are progressing regarding the
         recently-announced proposed sale of the company's town centre
         site.

    ·  If confirmed, cash from the site sale will in part be used to
         fund further acquisitions.

    ·  Interim dividend unchanged at 0.50p (2002 0.5p).

    "Our objective is to build the UK's leading natural consumer healthcare business", said Chairman Timothy Dye. "The proposed move from our historic town centre site is a momentous decision and an important milestone in the transformation of the business which began three years ago. The establishment of a new Board and senior management team, as well as the move to AIM, have been a vital part of the successful implementation of the strategy to grow the Company through the acquisition and development of healthcare brands".

    The Board believes the Company is uniquely placed to take advantage of two major trends: the general increase in interest in natural healthcare solutions and the fact that multi-national pharmaceutical companies are mainly focussing on global consumer healthcare brands while divesting national brands, some of which Ransom is interested in acquiring.

    For further information please contact Mr T G Dye (Chairman & Chief Executive) or Mr R Howard (Finance Director) 01462 437615.

    Chairman's Statement

    On 15 October, I announced the Board's proposals to sell the company's historic Hitchin town centre site. Under the plans, pharmaceutical manufacture would be transferred to our pharmaceutical production facility at Witham, Essex, while extract production would be transferred to an industrial site in Hitchin. This is a momentous decision in the company's history.

    There is little doubt that, if confirmed, the planned move would be very beneficial to the company and its shareholders. The reorganisation would produce operational savings resulting from the consolidation of the company's pharmaceutical manufacturing activities onto one site. Cash from the sale of the 4.3 acre Hitchin property would be used for the continued growth of the Consumer Healthcare Division as well as for the expansion of the Witham site and the creation of a state-of-the-art botanical extraction facility in the Hitchin area. Staff in Hitchin would be affected however and it is intended that redundancies would be kept to a minimum by offering some employees the opportunity to transfer to another of the company's sites.

    The proposals represent an important milestone in the transformation of the business which began three years ago. As well as a new Board and senior management team and a move to AIM, the company has adopted and begun successful implementation of its strategy to become a natural consumer healthcare business through the acquisition and development - using its botanical expertise - of healthcare brands.

    Results

    In the six months to 30 September 2003, profit before tax and amortisation of goodwill was almost unchanged, at £55k (2002: £56k), from the comparable period last year. Sales declined slightly, by 1.6%, to £6,731k (2002: £6,842k). The Board has declared an unchanged dividend of 0.50p per share, payable on 9 January 2004 to those shareholders on the register on 19 December 2003.

    Operating Review

    Profit performance of the Consumer Healthcare Division (CHD) has been satisfactory so far this year, with a small overall decrease in branded sales off-set by improved cost control. The brands Metanium and Pavacol-D are performing particularly well. Radian B's UK sales, having been affected by significantly increased competitor advertising spend over the previous six months, have now begun to improve following the introduction of new product lines in September. Cariad's streamlined product range has delivered a good level of profitability.

    In the Pharmaceuticals and Natural Extracts Division (PNED), sales in the first six months were approximately at the same levels as those in the period to 30 September 2002. The company has already begun to take operational decisions to facilitate its proposed site move. In particular, it has terminated some contract and other business which is not intended for transfer to the Witham site.

    Financial Review

    The fall in gross profit to £1,777k (2002: £2,014k) - which is addressed by the business reorganisation plans - reflects the change in sales mix in the traditional business away from generic liquids and towards lower margin contract manufacturing. The effect was more than off-set by control of selling, distribution and administration costs, which amounted to £1,620k (2002: £1,878k).

    Net cashflow from operating activities improved to £353k (2002: £87k) largely due to improved debtor collections.

    The acquisition costs of £93k shown in the cashflow statement for the period relate to the acquisition of Pavacol-D that was completed in March 2003. A further £60k will be paid in November 2003.

    Site Sale Progress

    We have now received, through our property advisers, indicative offers to acquire our Hitchin site. The Board's initial view is that some of these offers are attractive enough for it to be able to pursue discussions with a short-list of developers.

    Potential Acquisitions

    The company continues to seek appropriate acquisitions both of privately-owned healthcare businesses and of consumer healthcare brands from multi-national pharmaceutical companies. We are in discussion with a number of potential vendors of licensed pharmaceuticals and healthcare brands which would extend the company's consumer product range extensively.

    Outlook

    The Consumer Healthcare Division is expected to continue to grow organically. We believe that there are also many profitable opportunities to expand the business significantly by acquisition.

    As I reported in my statement of 15 October, if the site sale plans are confirmed, the financial results for the years ending 31 March 2004 and 2005 would be materially affected by the exceptional items involved and by the necessary upheaval in the traditional (PNED) business. Over the medium term, the proposals are expected to produce great benefit for the company.

    Timothy Dye     Chairman and Chief Executive     William Ransom & Son plc     Hitchin, Hertfordshire

    17 November 2003


                                            Profit and loss account

                                          For the six months          For the year
                                          ended 30 September        ended 31 March

                                                2003          2002                        2003
                                              £'000         £'000                      £'000
Turnover - continuing
Operations                              6,731         6,842                    14,725
Cost of sales                        (4,954)      (4,828)                 (10,277)
                                        ---------  ---------              ----------
Gross profit                          1,777         2,014                      4,448
Selling and distribution
Expenses                                (1,117)      (1,257)                  (2,136)
Administrative expenses
excluding goodwill
Amortisation                            (503)         (621)                  (1,570)
                                          -------      -------                ---------
Operating profit before
goodwill amortisation                157            136                         742
Goodwill amortisation              (150)         (147)                      (294)
                                          -------      -------                ---------
Operating profit/(loss)              7              (11)                        448
Income from investments              -                -                              7
Net interest and similar
charges                                  (102)            (80)                      (186)
(Loss)/profit on ordinary  -------      -------                ---------
activities before taxation      (95)            (91)                        269
Tax on (loss)/profit on
ordinary activities                  14                12                         (95)
                                                ----          ----                    ------
(Loss)/profit on ordinary
activities after taxation        (81)            (79)                        174
Dividends                                (135)          (132)                      (399)
                                            -------      -------                  -------
Retained loss                         (216)         (211)                      (225)
                                            =======      =======                  =======
Earnings per share
Basic                                  (0.30p)      (0.31p)                    0.64p
Diluted                                (0.30p)      (0.31p)                    0.64p
Excluding goodwill
Amortisation                         0.26p         0.26p                      1.73p

                                                    Balance sheet

                                                        at 30 September      at 31 March

                                                        2003          2002                 2003
                                                      £'000         £'000                £'000
Fixed Assets
Intangible assets                          5,448         5,612                5,556
Tangible assets                              5,766         6,088                6,060
                                                  -------      -------            -------
                                                    11,214        11,700              11,616
                                                 --------    --------          --------
Current Assets
Stocks                                            3,634         3,647                3,316
Debtors                                          2,653         2,561                3,342
Investments                                         77              77                    77
Cash at bank and in hand                  162            215                  105
                                                    ------         -----              ------
                                                      6,526         6,500                6,840
                                                    ------        ------              ------
Creditors
Amounts falling due
within one year                            (3,148)      (3,013)            (3,566)
                                                 ---------    -------            -------
Net current assets                         3,378         3,487                3,274
                                                    -------      -------          -------
Total assets less current
Liabilities                                  14,592        15,187              15,640
                                                  --------    --------          --------
Creditors                                              
Amounts falling due after one
year                                              (2,189)      (2,505)            (2,266)
Deferred taxation                            (566)         (471)                (566)
                                                    -------      -------            -------
                                                    11,837        12,211              12,058
                                                  ========    ========          ========
Capital and reserves
Called up share capital                 2,692         2,649                2,649
Shares to be issued                              -            318                  176
Share premium account                    4,221         4,090                4,093
Revaluation reserve                              5                5                      5
Profit and loss account                 4,919         5,149                5,135
                                                  -------      -------            -------
                                                    11,837        12,211              12,058
                                                 ========    ========          =======

                                                Cash flow statement


                                              For the six months        For the year
                                              ended 30 September    ended 31 March
                                                                                          
                                                  2003          2002                    2003
                                                 £'000         £'000                  £'000
Net cash inflow from
operating activities                    353              87                      833
                                                 -----         -----                  -----
Returns on investment and
servicing of finance
Interest received                            -              16                        16
Interest paid                              (102)          (96)                  (202)
Dividend received on                              
liquidation of associate                 -                -                         7
Net cash outflow from returns
on investment and servicing    -------        ------                -------
of finance                                  (102)          (80)                  (179)
                                                -------        ------                -------

Taxation
Corporation tax received                 2              33                        33
                                                  ----        ------                  -----
Capital expenditure
Payments to acquire tangible
fixed assets                                 (22)         (272)                  (496)
Payments to acquire
intangible assets                         (42)         (827)                  (110)
Receipts from sales of
tangible fixed assets                      6              14                        10
                                                  -----        -----                 ------
                                                    (58)      (1,085)                  (596)
                                                  -----      -------                -------
Acquisitions and disposals
Payments to acquire trade            (93)              -                    (870)

Equity Dividends
Equity dividends paid                      -                -                    (265)
                                                  -----         -----                -------
Cash flow before use of
liquid resources                          102         (1,045)                (1,044)
                                                  -----         ------            ---------
Management of liquid
resources
Cash flow on 1 month
deposit                                              -          1,000                  1,000
                                                 -------      -------              --------
Financing
Proceeds from new bank
loan                                                200                -                         -
Issue of ordinary share
capital                                         (240)              -                    (115)
Issue expenses for
shares                                              (5)            (4)                        -
                                                    -----         -----          ----------
                                                      (45)            (4)                  (115)
                                                 -------         -----                -------
Change in cash                                 57            (49)                  (159)
                                                ========    ========                =======
                                                              

                                                         Notes

1. Basic earnings per share are based on the profit on ordinary     activities after taxation and on 26,714,373 shares (2002     26,366,895 shares) the weighted average number of shares in     issue during the period. The diluted earnings per share are the     same as the basic earnings per share.

2. The results for the six months ended 30 September 2003 and 30     September 2002 are unaudited. They have been prepared on the     basis of accounting policies expected to be adopted for the       year ended 31 March 2004. The figures for the     year ended 31 March 2003 have been extracted from the full         accounts for that year which have been delivered to the     Registrar of Companies and on which the auditors have given an     unqualified report.

3. Reconciliation of operating loss with net cash inflow from     operating activities

                                          For the six months         For the year
                                          ended 30 September        ended 31March
                                                                              
                                                2003          2002                      2003
                                              £'000         £'000                    £'000
    Operating profit/(loss)          7            (11)                      448
    Depreciation                         300            285                        535
    Amortisation and impairment
    of intangibles                      150            147                        294
    Loss/(profit) on sale of
    tangible fixed assets            10            (14)                        (7)
    Increase in stocks              (318)         (749)                    (325)
    Decrease/(increase) in
    debtors                                 703            440                      (374)
    (Decrease)/increase in
      creditors                          (499)            11                        262
                                            -------        -----                  ------  
                                                 353              87                        833
                                              ======        =====                  ======

4. Analysis of net funds

    Change in cash                        57            (49)                    (159)
    Change in liquid resources      -        (1,000)                 (1,000)
    Change in net debt                 34                -                        115
                                                -----        ------                  -----
    Change in net funds                91        (1,049)                 (1,044)
    Opening net funds            (2,638)      (1,594)                 (1,594)
                                            (2,547)      (2,643)                 (2,638)
                                         ---------  ---------            ---------
    Represented by
    Cash at bank and in hand      162            215                        105
    Cash on deposit                        -                -                          -
                                              -----         -----                    -----
                                                 162            215                        105
    Debt within one year          (520)         (353)                    (477)
    Debt after one year         (2,189)      (2,505)                 (2,266)
                                         ---------  ---------                --------
                                            (2,547)      (2,643)                 (2,638)
                                         =========  =========                ========

5. Copies of this interim report are being sent to shareholders.     Further copies can be obtained from the company's registered     office at 104 Bancroft, Hitchin, Hertfordshire SG5 1LY.


                          This information is provided by RNS
         The company news service from the London Stock Exchange


ots Originaltext: William Ransom & Son plc
Internet: www.newsaktuell.ch

Contac:
Mr T G Dye (Chairman & Chief Executive) or
Mr R Howard (Finance Director)
Phone: +44/1462'437615.



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