Renishaw PLC
22 July 2004
22nd July 2004
Renishaw plc and subsidiary undertakings
Preliminary announcement of results for the year ended 30th June 2004
PROFIT AND LOSS ACCOUNT
2004 2003
£'000 £'000
Turnover 127,701 110,640
Cost of sales 69,188 59,941
Gross profit 58,513 50,699
Distribution costs 25,201 22,880
Administration costs * 15,259 12,175
Operating profit 18,053 15,644
Interest receivable less payable 2,043 1,925
Other finance income 50 230
Profit on ordinary activities before taxation 20,146 17,799
Tax on profit on ordinary activities 4,023 3,454
Profit for the financial year 16,123 14,345
Dividends 13,100 12,156
Retained profit for the financial year 3,023 2,189
*************************
Earnings per share (basic and diluted) 22.1p 19.7p
Dividend per share 18.0p 16.7p
* Administration costs include one-off currency profits arising on forward
foreign exchange contracts totalling £0.4m this year (2003 £3.0m).
BALANCE SHEET 2004 2003
£'000 £'000
Fixed assets 58,496 50,877
Current assets:
Stock 22,288 20,171
Debtors 32,820 29,600
Cash (net) 32,833 37,235
Creditors due within one year (26,031) (20,534)
Net current assets 61,910 66,472
Provisions for liabilities and charges (4,306) (3,503)
Pension liability (8,390) (8,620)
Net assets, equal to shareholders' funds 107,710 105,226
*************************
CASH FLOW STATEMENT 2004 2003
£'000 £'000
Net cash inflow from operating activities 22,159 20,481
Interest received (net) 2,026 1,906
Tax paid (3,096) (1,380)
Capital expenditure:
Purchase of tangible fixed assets (14,899) (8,184)
Proceeds from sale of tangible fixed assets 163 158
(14,736) (8,026)
Equity dividends paid (12,351) (11,763)
(Decrease)/increase in cash before currency (5,998) 1,218
differences
Analysis of changes in cash at bank during the
year:
(Decrease)/increase in cash before currency (5,998) 1,218
differences
Currency differences 1,596 361
(4,402) 1,579
Net funds at 1st July 37,235 35,656
Net funds at 30th June 32,833 37,235
TURNOVER ANALYSIS
2004 2003 2004
sales at
£'000 £'000 2003
exchange
rates
£'000
Continental Europe 48,983 41,619 47,973
Far East, including Japan & Australia 34,099 26,407 35,812
North & South America 33,305 31,163 36,384
Other overseas regions 2,494 1,780 2,507
UK and Ireland 8,820 9,671 8,820
Total Group turnover 127,701 110,640 131,496
*************************
NOTES:
1. The financial information set out above does not constitute the
Company's statutory financial statements for the years ended 30th June
2004 or 30th June 2003 but is derived from those financial statements.
Statutory financial statements for 2003 have been delivered to the
Registrar of companies, whereas those for 2004 will be delivered
following the Company's annual general meeting. The auditors have
reported on those financial statements; their reports were unqualified
and did not contain a statement under section 237(2) or (3) of the
Companies Act 1985.
2. The proposed final dividend of 12.39 net per share for the year ended 30th
June 2004 will be paid on 18th October 2004 to shareholders on the register
on 17th September 2004.
**********************
The Chairman's statement to be included in the 2004 Annual report and financial
statements:
I have pleasure in announcing a successful set of results for the 12 months
ended 30th June 2004.
Turnover rose by 15% to £127.7m (2003 £110.6m), an increase of 19% if measured
at constant exchange rates. This represents the highest turnover in the
Company's history. Sales rose in all markets with the exception of the UK, most
notably in the Far East (including Japan), but also in the emerging markets of
Eastern Europe and Russia. This reflected growth in all our product lines, but
with above-average growth in Digitising (including dental), Encoders,
Calibration and Machine Tool products.
Operating profit increased by 15% to £18.1m (2003 £15.6m) despite a reduction in
one-off currency profits on forward foreign exchange contracts of £0.4m this
year and £3.0m in 2003. Profit before tax rose by 13% to £20.1m (2003 £17.8m).
Profit after tax amounted to £16.1m compared with £14.3m in the previous year,
giving rise to earnings per share growth of 12% to 22.1p (2003 19.7p).
Manufacturing
There has been significant investment at the New Mills and Woodchester sites in
additional capacity and capability, including CNC lathes, additional machines
for incorporation into the Company's automated milling, turning and inspection
system and surface-mount electronic assembly inspection and test equipment.
Phase II development at Woodchester is now complete; a further 30,000 sq feet of
manufacturing space will become available at this site later in the year.
Marketing
Our activity in marketing throughout the world has continued at a high level.
All our recently established subsidiaries in Czech Republic, Poland, Russia,
Austria, Sweden, Canada, Israel and South Korea have grown well in their markets
and are already making a significant contribution to the Group's overall results
and distribution infrastructure. The Group is planning to open additional
offices in both China and Russia.
Research and development
The Group's ongoing commitment to research and development, which has continued
through the recent economic downturn, has resulted in the successful launch of a
number of new products during the year, including the UCC2 and SPA2 CMM
controller system, the NC4 non-contact laser system for high speed toolsetting
and tool breakage detection, RMP60/RMI radio system, the inVia reflex Raman
microscope interfaced with scanning electron microscopes for precision single
point sample analysis, a range of rotary magnetic encoder products and
additional software products.
Expenditure on our research and development increased to £22.0m (2003 £20.2m)
including related engineering costs.
Capital expenditure
Capital expenditure, including that on new manufacturing equipment, amounted to
£15.6m (2003 £8.2m), of which £6.5m (2003 £2.7m) was spent on freehold property,
with the new offices in Japan costing £5.1m. Further investment was made in IT
hardware and software throughout the Group, but particularly for design systems,
marketing and management systems and group infrastructure.
Liquidity
The Group continues to maintain a high level of liquidity, with net bank
balances at the year end of £32.8m (2003 £37.2m).
Awards
I am delighted to report that the Group has again won a number of awards. The
Queen's Award for Enterprise was won in respect of the OMP40 compact scanning
probe. This, I am pleased to say, was the 10th Queen's Award in the Company's
history. The Metalworking and Production Award at the Mach 2004 Exhibition was
awarded in respect of the SP25 scanning probe for 'The Best Quality Control
Product or System'. The Worshipful Company of Scientific Instrument Makers
awarded their 2003 Annual Achievement Award in respect of the RESR rotary
encoder.
In addition, the Company won the 2003 National Training Award and was the
regional winner of the National Languages for Export Award.
Personnel
With recruitment primarily targeted at local production and overseas sales
personnel, particularly in the Far East and our recently established subsidiary
companies, numbers employed in the Group worldwide have grown to 1,754 (2003
1,639). To all of them I express my gratitude for their commitment and drive in
maintaining Renishaw as a world leader in its field.
I should also like to congratulate Joe McGeehan on his recent award of a CBE.
Prospects and dividend
Activity picked up considerably in the second half of the year and forward order
books have continued to increase. Although exchange rates continue to limit the
Group's ultimate profitability, we are optimistic for the current year and
confident of the Group's longer term prospects.
Your Board proposes a final dividend of 12.39p per share, giving a total for the
year of 18.0p (2003 16.7p).
Sir David R McMurtry, CBE, RDI, CEng, FIMechE, FREng
Chairman & Chief Executive
21st July 2004
Enquiries: B R Taylor 01453 524445
A C G Roberts 01453 524445
Registered office: New Mills, Wotton-under-Edge, Gloucestershire. GL12 8JR
Telephone: 01453 524524
This information is provided by RNS
The company news service from the London Stock Exchange
