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1 | 60054173_2 | 60054173 | UTS), a firm which specialises in providing advice to utilities upon water resource and leak management. The initial consideration was £1.5 million, comprising of £1 million in cash and 171,821 new RPS shares. A further payment of £0.5 million in loan notes and cash and 142,857 new RPS shares was made on 30th November 1998, following independent audit of performance up to 30th September 1998. A final payment of up to £1.5 million will be made based upon performance in the year to September 1999. In the period that UTS was part of the Group it made an important contribution to both turnover (£3.8m) and operating profit (£0.7m). The business grew substantially in this period: a trend which the Board anticipates will continue as a result of the regulatory pressures upon water companies and investment made by the Group in UTS's operating systems.
ACQUISITIONS On 6th April 1998, we completed the acquisition of Utility Technical Services Ltd
BALANCE SHEET Year end net assets increased 53.2% to £11.8 million (1997: £7.7 million). Despite
Accident Investigation
Contaminated Land and EIL Cover
COSHH Assessments
Environmental Due Diligence
Environmental Management Systems
Environmental Liability Assessment
Expert Witness
Fire and Emergency Planning
Health and Safety Independent Peer Review Loss Adjustment and Technical Expertise Loss Prevention Pipeline Risk Assessment
Procurement Support
Quality Management Systems
Quantitative Risk Assessment
Safety Case Preparation
Safety Management Systems
Safety Training Courses
RPS GROUP PLC
2
Chairman's Statement
acquisition payments and the working capital required to fund the growth of UTS, the Group maintained positive cash balances throughout the year and had £3.9 million in cash at the year end (1997: £4.5 million). As has been the case for the last 6 years, trading debt is insignificant.
OUTLOOK The Group has strong management and financial systems in place. In view of concerns expressed about the state of the economy we have, in recent months, devoted additional attention to monitoring short term trading patterns in order that we are not caught unawares by cyclical downturns in any of our markets. To date we have noticed no significant adverse trends.
Whatever happens to the economy in 1999, our business will be supported by: l the |
1 | 60054173_3 | 60054173 | Cover
COSHH Assessments
Environmental Due Diligence
Environmental Management Systems
Environmental Liability Assessment
Expert Witness
Fire and Emergency Planning
Health and Safety Independent Peer Review Loss Adjustment and Technical Expertise Loss Prevention Pipeline Risk Assessment
Procurement Support
Quality Management Systems
Quantitative Risk Assessment
Safety Case Preparation
Safety Management Systems
Safety Training Courses
RPS GROUP PLC
2
Chairman's Statement
acquisition payments and the working capital required to fund the growth of UTS, the Group maintained positive cash balances throughout the year and had £3.9 million in cash at the year end (1997: £4.5 million). As has been the case for the last 6 years, trading debt is insignificant.
OUTLOOK The Group has strong management and financial systems in place. In view of concerns expressed about the state of the economy we have, in recent months, devoted additional attention to monitoring short term trading patterns in order that we are not caught unawares by cyclical downturns in any of our markets. To date we have noticed no significant adverse trends.
Whatever happens to the economy in 1999, our business will be supported by: l the breadth and depth of our skills, office
network and client base; l the Government's commitment to
pressurise industry into building a "sustainable" economy;
l an increasingly rigorous legislative framework limiting the extent to which companies can cause adverse effects upon the environment and human health;
l increasing awareness of the risk involved in managing and acquiring assets in both the public and private sector;
l a continuing requirement for utilities to improve management of water resources;
l the buoyant state of the economy in the Netherlands, giving BAK the opportunity to continue to expand.
We approach 1999 with optimism and realism, ready to respond to both market opportunities and economic uncertainties.
Having successfully integrated UTS, further acquisition opportunities are being actively pursued in both the UK and the Netherlands, in addition to continuing to develop our existing business.
BROOK LAND Chairman
RPS GROUP PLC
3
Operating Review
The UK Government is pursuing a range of initiatives in order to push the country towards greater "sustainability". The private sector is having to respond to this changing political agenda. Provided we develop sufficiently focussed and commercial services, we are ideally placed to assist major companies find their way through an increasingly complex range of issues. |
1 | 60054173_b0 | 60054173 | don OX14 4RY 01235 863206 rpsab@rpsplc.co.uk
Operating offices
Aberdeen 01224 773734 rpsad@rpsplc.co.uk
Alton 01420 541636 rpsal@rpsplc.co.uk
Bath 01225 275550
Belfast 01232 393969 rpsbe@rpsplc.co.uk
Chepstow 01291 621821 rpssw@rpsplc.co.uk
Chester 01244 313486 rpsch@rpsplc.co.uk
Cork 00353 21 276266 rpsco@rpsplc.co.uk
Dartford 01322 275550
Derby 01773 827737
Durham 0191 386 7226 rpsdu@rpsplc.co.uk
Edinburgh 0131 555 5011 rpsed@rpsplc.co.uk
Glasgow 01698 747724 rpsgl@rpsplc.co.uk
Huddersfield 01484 543124 rpshu@rpsplc.co.uk
London 0171 928 0999 rpslo@rpsplc.co.uk
Manchester 0161 226 7886 rpsma@rpsplc.co.uk
Milton Keynes 01327 811711 rpsmk@rpsplc.co.uk
Oxford 01235 821888 rpsox@rpsplc.co.uk
Rotterdam 0031 180 617 433 contact@bak.nl
Southampton 01703 339566 rpsso@rpsplc.co.uk
Warrington 01925 831000 rpswa@rpsplc.co.uk
designed & produced by T H E D E S I G N P O R T F O L I O www.design-portfolio.co.uk
RPS GROUP PLC
5
RPS Group plc Centurion Court 85 Milton Park Abingdon OX14 4RY
Tel: 01235 863206 Fax: 01235 834698
E-mail: rpsab@rpsplc.co.uk Web: http://www.rpsplc.co.uk
|
1 | 60054173_b1 | 60054173 |
There were no fair value adjustments required to reflect the Directors' assessment of fair market value.
The subsidiary undertaking acquired during the year contributed £42,000 to the Group's net operating cash flows, received £nil in respect of net returns on investment and servicing of finance, paid £220,000 in respect of taxation and utilised £362,000 for capital expenditure.
Turnover and profit before taxation contributed by the subsidiary undertaking acquired during the year is disclosed on the face of the profit and loss account.
During the six month period to the effective date of acquisition of 6th April1998, the results of the subsidiary undertaking were as follows: turnover £1,034,000, operating profit £227,000, profit after taxation £97,000. In its previous financial year to 30th September 1997 the profit after taxation was £313,000.
RPS GROUP PLC
32
Group Directory
Group operating companies
l RPS Cairns l RPS Clouston l RPS Consultants l RPS Thomson l SRC Consultants l BAK Nederland Beheer BV l Utility Technical Services
Group headquarters
RPS Group plc Centurion Court 85 Milton Park Abingdon OX14 4RY 01235 863206 rpsab@rpsplc.co.uk
Operating offices
Aberdeen 01224 773734 rpsad@rpsplc.co.uk
Alton 01420 541636 rpsal@rpsplc.co.uk
Bath 01225 275550
Belfast 01232 393969 rpsbe@rpsplc.co.uk
Chepstow 01291 621821 rpssw@rpsplc.co.uk
Chester 01244 313486 rpsch@rpsplc.co.uk
Cork 00353 21 276266 rpsco@rpsplc.co.uk
Dartford 01322 275550
Derby 01773 827737
Durham 0191 386 7226 rpsdu@rpsplc.co.uk
Edinburgh 0131 555 5011 rpsed@rpsplc.co.uk
Glasgow 01698 747724 rpsgl@rpsplc.co.uk
Huddersfield 01484 543124 rpshu@rpsplc |
1 | 60054318_0 | 60054318 | JOHNSON
1998
focusing on customer service
CONTENTS
1 CORPORATE STATEMENT
3 CHAIRMAN'S STATEMENT
6 REVIEW OF OPERATIONS
17 FINANCIAL REVIEW
20 DIRECTORS AND ADVISORS
21 DIRECTORS' BIOGRAPHIES
22 CORPORATE GOVERNANCE
24 DIRECTORS' REPORT
26 DIRECTORS' RESPONSIBILITIES STATEMENT
27 BOARD REPORT ON REMUNERATION
32 AUDITORS' REPORT
33 FIVE YEAR RECORD
33 FINANCIAL CALENDAR AND WEB SITE
34 CONSOLIDATED PROFIT AND LOSS ACCOUNT
35 BALANCE SHEETS
36 CONSOLIDATED CASH FLOW STATEMENT
37 STATEMENT OF TOTAL RECOGNISED
GAINS AND LOSSES
37 CONSOLIDATED HISTORICAL COST
PROFITS AND LOSSES
38 STATEMENT OF ACCOUNTING POLICIES
40 NOTES TO THE FINANCIAL STATEMENTS
61 NOTICE TO HOLDERS OF CONVERTIBLE
PREFERENCE SHARES
Johnson Service Group PLC is one of the. largest textile rental operators and the. leading drycleaning company in Britain. Our textile rental services division is a. major. provider of workwear rental services. under. the Johnsons Apparelmaster brand, and a. market leader in customer service. Connacht Court Group, acquired during. 1998, is the largest textile rental business in. Ireland. Johnsons Cleaners is Britain's. largest. retail drycleaner, with 564 shops. nationwide. We intend to achieve growth. by focusing on our specialist skill areas. and constantly raising our standards of. quality, convenience, service and efficiency.
CHAIRMAN'S STATEMENT
I am pleased to report good trading results and major progress in the strategic re-direction of the Group, involving the planned disposal of all our US trading interests and the acquisition of Ireland's largest textile rental company.
GROUP RESULTS AND DIVIDEND
Turnover from continuing operations increased by 11.1% to £196.9 million (1997: £177.3 million) and operating profit, before goodwill amortisation, by 17.8% to £24.8 million (1997: £21.0 million). Excluding first time contributions from acquisitions during the year, these increases were 4.8% and 12.8 |
1 | 60054318_1 | 60054318 | drycleaning company in Britain. Our textile rental services division is a. major. provider of workwear rental services. under. the Johnsons Apparelmaster brand, and a. market leader in customer service. Connacht Court Group, acquired during. 1998, is the largest textile rental business in. Ireland. Johnsons Cleaners is Britain's. largest. retail drycleaner, with 564 shops. nationwide. We intend to achieve growth. by focusing on our specialist skill areas. and constantly raising our standards of. quality, convenience, service and efficiency.
CHAIRMAN'S STATEMENT
I am pleased to report good trading results and major progress in the strategic re-direction of the Group, involving the planned disposal of all our US trading interests and the acquisition of Ireland's largest textile rental company.
GROUP RESULTS AND DIVIDEND
Turnover from continuing operations increased by 11.1% to £196.9 million (1997: £177.3 million) and operating profit, before goodwill amortisation, by 17.8% to £24.8 million (1997: £21.0 million). Excluding first time contributions from acquisitions during the year, these increases were 4.8% and 12.8% respectively.
The Group's pre-tax profit, excluding exceptional items and goodwill amortisation, increased by 15.9% to £23.4 million (1997: £20.1 million). Fully diluted earnings per share, excluding goodwill amortisation and exceptional items, increased by 15.5% to 28.94p (1997: 25.06p).
Exceptional items amounted in total to £40.7 million (1997: £2.7 million), of which £40.3 million arose from writing down to estimated realisable value the goodwill on the original acquisition of the businesses of our US subsidiary, Johnson Group Inc. (JGI). On 26th January 1999, we announced the disposal of JGI, subject to the purchaser arranging the necessary finance, for an aggregate consideration of approximately £29.5 million, with completion in April 1999. This goodwill write-down is in accordance with normal UK accounting practice and has no effect on the Group's balance sheet.
Our balance sheet remains strong with net debt at the year end of £31.9 million (1997: £23.9 million), giving gearing of 43.3% compared with 30.6% a year earlier. Interest cover remains very high. The increase in |
1 | 60054318_2 | 60054318 | % respectively.
The Group's pre-tax profit, excluding exceptional items and goodwill amortisation, increased by 15.9% to £23.4 million (1997: £20.1 million). Fully diluted earnings per share, excluding goodwill amortisation and exceptional items, increased by 15.5% to 28.94p (1997: 25.06p).
Exceptional items amounted in total to £40.7 million (1997: £2.7 million), of which £40.3 million arose from writing down to estimated realisable value the goodwill on the original acquisition of the businesses of our US subsidiary, Johnson Group Inc. (JGI). On 26th January 1999, we announced the disposal of JGI, subject to the purchaser arranging the necessary finance, for an aggregate consideration of approximately £29.5 million, with completion in April 1999. This goodwill write-down is in accordance with normal UK accounting practice and has no effect on the Group's balance sheet.
Our balance sheet remains strong with net debt at the year end of £31.9 million (1997: £23.9 million), giving gearing of 43.3% compared with 30.6% a year earlier. Interest cover remains very high. The increase in net debt of some £8.0 million partly reflects the difference between the cost of acquiring Connacht Court Group Ltd (CCG) for £24.9 million in cash in July 1998, and the proceeds of the sale of our US textile rental business of £17.4 million in cash in February 1998. The Group's gearing will be significantly reduced by the £18.5 million of cash due on completion of the disposal of JGI.
The Board is proposing a second interim dividend of 11.0p (1997: 9.6p) making a total dividend for the year of 14.3p (1997: 12.6p), an increase of
Johnson Service Group plc and its subsidiaries
three
CHAIRMAN'S STATEMENT
13.5%. The second interim dividend will be paid on 4th May 1999 to shareholders on the register at 26th March 1999.
TRADING REVIEW
Our British textile rental businesses increased their turnover by 10.7% to £59.9 million (1997: £54.1 million) and operating profit by 16.3% to £14.7 million (1997: £12.7 million). The margin improved to 24.6% (1997: 23 |
1 | 60054318_3 | 60054318 | net debt of some £8.0 million partly reflects the difference between the cost of acquiring Connacht Court Group Ltd (CCG) for £24.9 million in cash in July 1998, and the proceeds of the sale of our US textile rental business of £17.4 million in cash in February 1998. The Group's gearing will be significantly reduced by the £18.5 million of cash due on completion of the disposal of JGI.
The Board is proposing a second interim dividend of 11.0p (1997: 9.6p) making a total dividend for the year of 14.3p (1997: 12.6p), an increase of
Johnson Service Group plc and its subsidiaries
three
CHAIRMAN'S STATEMENT
13.5%. The second interim dividend will be paid on 4th May 1999 to shareholders on the register at 26th March 1999.
TRADING REVIEW
Our British textile rental businesses increased their turnover by 10.7% to £59.9 million (1997: £54.1 million) and operating profit by 16.3% to £14.7 million (1997: £12.7 million). The margin improved to 24.6% (1997: 23.4%). This reflected a strong performance from the Apparelmaster business and an outstanding performance from Stalbridge Linen Services, our specialist linen hire company.
Despite some localised signs of contraction in the manufacturing sector in the second half of the year, the rate of increase in sales was only slightly lower and second half profits were still ahead by a healthy 12.9% (first half: 20.1%).
CCG, Ireland's largest textile rental company, contributed £11.0 million to turnover and £1.0 million to operating profit, excluding goodwill amortisation, in its first five months in the Group, in line with our expectation.
Our British drycleaning business increased its turnover by 2.4%, 5.5% on a same source basis, to £73.1 million (1997: £71.4 million) and its operating profit excluding goodwill amortisation by 13.9% to £6.9 million (1997: £6.1 million). Margins improved to 9.5% (1997: 8.5%) as the benefits of rebranding continued to materialise.
The rate of increase in profit was somewhat lower in the second half of the year at 7.1% (first half |
1 | 60054318_b0 | 60054318 | 2121/2p (ex div)
225p 2381/2p 2571/2p 2711/2p 2801/2p 2931/2p (ex div)
Johnson Service Group plc
sixty three
The following information relating to conversion of 1,000 Convertible preference shares into 485 Ordinary shares may be helpful to you in considering whether or not to exercise your conversion rights on 1st June 1999.
Capital value at 23rd March 1999
1,000 Convertible preference shares at 1371/2p each 485 Ordinary shares at 2931/2p each
£1,375 £1,423
Income for the year to 26th December 1998
1,000 Convertible preference shares carried dividends at the rate of 7.5p per Convertible preference share 485 Ordinary shares carried dividends at the rate of 14.3p per Ordinary share
£75.00 £69.36
It should be noted that the Ordinary dividend rate is based on declarations for the 1998 financial year and does not necessarily mean that the rate of dividend will be maintained in future years.
On the basis of current legislation, holders of Convertible preference shares who are resident in the United Kingdom for tax purposes will not incur any liability for United Kingdom taxation of capital gains by reason only of the exercise of your right to convert your Convertible preference shares into Ordinary shares. If you are in any doubt as to your tax position, you are strongly advised to consult your independent professional advisor before taking any action.
The purpose of this Notice is to remind you of your conversion rights and it should not be taken as a recommendation to either convert or not to convert. If you are in any doubt about the action you should take you should consult your professional advisor.
By order of the Board
Yvonne M. Monaghan Secretary Mildmay Road, Bootle, Merseyside L20 5EW 8th April 1999
sixty four
Johnson Service Group plc and its subsidiaries
Johnson Service Group would like to thank Matra Marconi Space, The Bank Restaurant, Whitehall Security, Belgo Central and, especially, the Johnsons staff at Sainsbury, Banbury.
Designed and produced by Jones Hallett Design Consultants Limited. Photography by Howard Grey.
Printed in England by Royle Print Limited, London.
|
1 | 60054318_b1 | 60054318 | th June 1999 by ordinary post at your risk, a cheque for the net proceeds of sale to which you are entitled in respect of any fraction of a share arising on conversion.
If a conversion notice is given in respect of part only of a holding of Convertible preference shares so that there would remain following conversion in such holding 20 or fewer such shares then the whole of the holding of Convertible preference shares shall be converted notwithstanding the figure contained in the conversion notice.
The London Stock Exchange has already granted listing for any new Ordinary shares arising upon conversion.
For your information, the middle market quotations of the Convertible preference shares and Ordinary
shares as derived from the London Stock Exchange Daily Official List on the dates specified below were
as follows:
Convertible Ordinary
preference shares shares
1st October 1998 2nd November 1998 1st December 1998 4th January 1999 1st February 1999 1st March 1999 23rd March 1999 (latest practicable date before this Notice was printed)
1091/2p 1121/2p
112p (ex div) 1241/2p (ex div) 1311/2p
132p 1371/2p
2121/2p (ex div)
225p 2381/2p 2571/2p 2711/2p 2801/2p 2931/2p (ex div)
Johnson Service Group plc
sixty three
The following information relating to conversion of 1,000 Convertible preference shares into 485 Ordinary shares may be helpful to you in considering whether or not to exercise your conversion rights on 1st June 1999.
Capital value at 23rd March 1999
1,000 Convertible preference shares at 1371/2p each 485 Ordinary shares at 2931/2p each
£1,375 £1,423
Income for the year to 26th December 1998
1,000 Convertible preference shares carried dividends at the rate of 7.5p per Convertible preference share 485 Ordinary shares carried dividends at the rate of 14.3p per Ordinary share
£75.00 £69.36
It should be noted that the Ordinary dividend rate is based on declarations for the 1998 financial year and does not necessarily mean that the rate of dividend will be maintained in future years.
On the basis of current legislation, |
1 | 60054345_0 | 60054345 | TAYLOR WOODROW PLC REPORT AND ACCOUNTS 1998
Benefiting from successful teamwork
Working together to achieve growth over the past year:
Financial highlights
Group turnover Group operating profit Profit before taxation Basic earnings per share Dividends per share Net borrowings Net gearing Shareholders' funds per share
Continuing the improvement in our performance over the past five years:
Profit before tax £million
Basic earnings per share pence
Page 1
1998
£1,400.5m £110.2m £100.3m 17.1p 5.1p £141.7m 20.7% 169.7p
1997
£1,295.7m £85.1m £82.1m 14.2p 4.5p £36.8m 6.0% 154.2p
Dividends per share pence
3.75 4.5 5.1
7.8 7.5
12.0 14.2 17.1
100.3
66.8 82.1
2.25 3.0
50.8 46.0
94 95 96 97 98
94 95 96 97 98
94 95 96 97 98
Page 2
Taylor Woodrow Annual Report 1998
Colin J Parsons Chairman
Chairman's statement
This is my final statement to shareholders prior to my retirement in June 1999, after a career of 40 years with the Group spent in North America and the UK. It is a great pleasure to look back on the previous year and report a substantial growth in profits and earnings. Compared with a loss of £94 million for 1992, the year in which I became chairman, it is gratifying to be able to report pre-tax profits of £100.3 million in 1998.
We have made a number of strategic moves to expand our housing and property development operations and the Group is now much more focused on these businesses. The results reflect the particular success of our North American and UK housing activities, where we have excellent management teams with long experience in their markets. Our UK property development businesses continue to grow steadily and will increasingly generate profits in the future. We also have the backing of our investment property portfolio which provides regular ongoing income.
Greenham Trading continues to produce resilient results. Our construction operation increased its profits, although these are not at an acceptable |
1 | 60054345_1 | 60054345 | 95 96 97 98
94 95 96 97 98
94 95 96 97 98
Page 2
Taylor Woodrow Annual Report 1998
Colin J Parsons Chairman
Chairman's statement
This is my final statement to shareholders prior to my retirement in June 1999, after a career of 40 years with the Group spent in North America and the UK. It is a great pleasure to look back on the previous year and report a substantial growth in profits and earnings. Compared with a loss of £94 million for 1992, the year in which I became chairman, it is gratifying to be able to report pre-tax profits of £100.3 million in 1998.
We have made a number of strategic moves to expand our housing and property development operations and the Group is now much more focused on these businesses. The results reflect the particular success of our North American and UK housing activities, where we have excellent management teams with long experience in their markets. Our UK property development businesses continue to grow steadily and will increasingly generate profits in the future. We also have the backing of our investment property portfolio which provides regular ongoing income.
Greenham Trading continues to produce resilient results. Our construction operation increased its profits, although these are not at an acceptable level. We continue to maintain a very cautious approach to this business.
Taylor Woodrow's continuing success reflects the benefits of our well-balanced blend of complementary business activities. This spread of interests provides us with a number of opportunities to advance the business without tying us to a dependency on any one area or market.
The board is recommending a final dividend of 3.6p compared with 3.25p for
1997. Together with the interim dividend of 1.5p paid on 2 November 1998, this makes a total dividend for the year of 5.1p, representing a 13% increase on the previous year, a further demonstration of our policy of continuing dividend growth. If approved at the annual general meeting, the final dividend will be paid on 1 July 1999 to shareholders on the register of members at the close of business on 14 May 1999. It will be paid as a conventional cash dividend. Once again, the board will be offering shareholders the facility to reinvest some or all of this dividend under the terms of the Dividend Re-investment Plan, details of which are contained in an accompanying circular to shareholders.
The board and management During 1998, we announced a number of changes which will affect the future composition of the board. Early in the |
1 | 60054345_2 | 60054345 | level. We continue to maintain a very cautious approach to this business.
Taylor Woodrow's continuing success reflects the benefits of our well-balanced blend of complementary business activities. This spread of interests provides us with a number of opportunities to advance the business without tying us to a dependency on any one area or market.
The board is recommending a final dividend of 3.6p compared with 3.25p for
1997. Together with the interim dividend of 1.5p paid on 2 November 1998, this makes a total dividend for the year of 5.1p, representing a 13% increase on the previous year, a further demonstration of our policy of continuing dividend growth. If approved at the annual general meeting, the final dividend will be paid on 1 July 1999 to shareholders on the register of members at the close of business on 14 May 1999. It will be paid as a conventional cash dividend. Once again, the board will be offering shareholders the facility to reinvest some or all of this dividend under the terms of the Dividend Re-investment Plan, details of which are contained in an accompanying circular to shareholders.
The board and management During 1998, we announced a number of changes which will affect the future composition of the board. Early in the year, as mentioned in the previous annual report, Paul Phipps, chairman of Taywood Homes Limited was appointed to the board. Then, with effect from 5 November 1998, my colleague, Keith Egerton, was appointed as Group chief executive. At the same time, Dr Robert Hawley joined the board and it is intended that he will succeed me when I retire after the 1999 annual general meeting, when he will become part-time chairman of the company. Details of the process by which these appointments were decided are given in the section "Corporate governance" on page 24 of this annual report.
Following my retirement, I shall be continuing as a non-executive director of Monarch Development Corporation, our Canadian subsidiary.
Page 3
At 31 December 1998, we said farewell to Mike Laycock, who had been a main board director since 1995 and who had given splendid service to Taylor Woodrow for 40 years.
These changes to the board have ensured that your company is well-equipped to drive the business forward and I am confident that Taylor Woodrow and its future are in good hands.
The London Stock Exchange Combined Code The publication of the London Stock Exchange's Combined Code has given further impetus to all companies to re-assess their corporate |
1 | 60054345_3 | 60054345 | year, as mentioned in the previous annual report, Paul Phipps, chairman of Taywood Homes Limited was appointed to the board. Then, with effect from 5 November 1998, my colleague, Keith Egerton, was appointed as Group chief executive. At the same time, Dr Robert Hawley joined the board and it is intended that he will succeed me when I retire after the 1999 annual general meeting, when he will become part-time chairman of the company. Details of the process by which these appointments were decided are given in the section "Corporate governance" on page 24 of this annual report.
Following my retirement, I shall be continuing as a non-executive director of Monarch Development Corporation, our Canadian subsidiary.
Page 3
At 31 December 1998, we said farewell to Mike Laycock, who had been a main board director since 1995 and who had given splendid service to Taylor Woodrow for 40 years.
These changes to the board have ensured that your company is well-equipped to drive the business forward and I am confident that Taylor Woodrow and its future are in good hands.
The London Stock Exchange Combined Code The publication of the London Stock Exchange's Combined Code has given further impetus to all companies to re-assess their corporate governance and internal control arrangements. Although the Stock Exchange has indicated that comprehensive reporting on internal control matters may be delayed until publication of the 1999 results, the board has decided that it would be appropriate to publish a statement commenting on these important matters even though technical guidance has not yet been published by the accounting profession. The section "Corporate governance" on page 24 contains information broadly in line with the provisions of the Combined Code and will give shareholders an indication of our approach to these subjects.
Most of our global markets are proving generally resilient to the economic slowdowns which were being forecast last year.
With the reduction in global interest rates, housing is becoming increasingly affordable. Our worldwide product range has the potential to bring increasing profits for shareholders from this important part of our business.
Already this year trading activity in our housing markets has started very positively.
Property markets are firmer, however conditions in construction will remain difficult. Greenham Trading's markets are also showing signs of improvement.
We have a good portfolio of prospects ready to deliver profit growth in future years and are looking closely at all our businesses to ensure that they perform to the best of their potential.
Taylor Woodrow consists of a team of enthusiastic and dedicated people and it is important that they should continue to |
1 | 60054345_b0 | 60054345 | .6) 17.5
1,146.3 50.8 (14.6) (3.8) 32.4 (8.8) 23.6
397.1 107.4 413.4 (23.0) (141.7) (69.5) 683.7
100.7 8.4
231.3 94.4
248.9 683.7
387.6 105.6 244.8 (19.1) (36.8) (69.4) 612.7
99.3 8.4
224.8 72.2
208.0 612.7
385.9 117.9 182.0 (24.7) (57.4) (63.5) 540.2
98.2 8.4
221.7 38.5
173.4 540.2
434.1 110.7 181.9 (18.2) (127.3) (65.6) 515.6
96.4 8.4
216.1 55.3
139.4 515.6
458.5 114.0 128.1 (15.7) (107.3) (60.1) 517.5
97.0 7.7
216.2 63.4
133.2 517.5
402.8 17.1p 5.1p
169.7p 3.4
20.7%
397.3 14.2p 4.5p
154.2p 3.2 6.0%
392.9 12.0p 3.75p
137.5p 3.2
10.6%
385.8 7.5p 3.0p
133.7p 2.5
24.7%
387.8 7.8p
2.25p 133.4p
3.5 20.7%
Designed by Langsford Corporate Design Limited Produced by Michael R Dalby Limited Taylor Woodrow wishes to acknowledge and thank all the clients and professional teams associated with the projects referred to in this annual report. The papers used for this annual report are produced from pulp bought from manufacturers operating strict reforestation programmes. They are Chlorine Free. The material is recyclable and bio-degradable.
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1 | 60054345_b1 | 60054345 | taxation Taxation charge Minority interests Profit for the financial year Dividends Profit retained
Balance sheet Investment properties Other fixed assets Net current assets (excluding cash and debt) Non-current creditors (excluding debt) and provisions Net debt Minority interests Shareholders' funds Represented by: Called up ordinary share capital Capital redemption reserve Share premium account Revaluation reserve Profit and loss account
Statistics Number of shares in issue at year end (millions) Basic earnings per share Dividends per share Shareholders' funds per share Dividend cover (times) Net gearing
1998 £m
1997 £m
1996 £m
1995 £m
1994 £m
1,400.5 100.3 (26.6) (5.5) 68.2 (20.5) 47.7
1,295.7 82.1 (20.7) (5.2) 56.2 (17.8) 38.4
1,189.7 66.8 (17.0) (3.0) 46.8 (14.7) 32.1
1,154.1 46.0 (12.9) (4.0) 29.1 (11.6) 17.5
1,146.3 50.8 (14.6) (3.8) 32.4 (8.8) 23.6
397.1 107.4 413.4 (23.0) (141.7) (69.5) 683.7
100.7 8.4
231.3 94.4
248.9 683.7
387.6 105.6 244.8 (19.1) (36.8) (69.4) 612.7
99.3 8.4
224.8 72.2
208.0 612.7
385.9 117.9 182.0 (24.7) (57.4) (63.5) 540.2
98.2 8.4
221.7 38.5
173.4 540.2
434.1 110.7 181.9 (18.2) (127.3) (65.6) 515.6
96.4 8.4
216.1 55.3
139.4 515.6
458.5 114.0 128.1 ( |
1 | 60054350_0 | 60054350 | DESIRE
PETROLEUM plc
1 9 9 8 A N N U A L R E P O R T
CONTENTS
Company Information Chairman's Statement Exploration Report Directors' Report Statement of Directors' Responsibilities Corporate Governance Report of the Remuneration and Appointments Committee Auditors' Report Profit and Loss Account Statement of Total Recognised Gains and Losses Reconciliation of Movements in Shareholders' Funds Balance Sheet Cash Flow Statement Notes on the Financial Statements Notice of Meeting
Page 2 3 5 9 13 14
15 16 17
18
18 19 20 21 26
1
COMPANY INFORMATION
Incorporated in England on 6 March 1996 Number 3168611 Chairman Dr Colin Barry Phipps B.Sc., Ph.D., F.G.S., F.Inst. Pet., C. Geol.
Deputy Chairman Sir Rex Masterman Hunt B.A., C.M.G. Nonexecutive Directors Mr Darwin Lewis Clifton M.Sc., M.Inst.Pet. Mr Stephen Lawrey Phipps B.Sc. Dr Alan John Martin B.Sc., Ph.D., F.G.S. Dr Ian Gordon Duncan B.Sc., Ph.D., F.G.S., C.Geol., EurGeol.
Secretary Mrs Anna Ruth Neve B.A.
Registered Office Mathon Court Mathon Malvern Worcestershire WR13 5NZ
2
Bankers Barclays Bank plc Swansea Business Centre Pocketts Wharf East Burrows Road Maritime Quarter Swansea SA1 3XL
Standard Chartered Bank Stanley Falkland Islands
Solicitors Osborne Clarke 50 Queen Charlotte Street Bristol BS1 4HE
Auditors Hacker Young Chartered Accountants St James Building 79 Oxford Street Manchester M1 6HT
Registrars IRG plc Balfour House 390-398 High Road Ilford Essex IG1 1NQ
Nominated Adviser and Nominated Broker SG Securities (London) Ltd Exchange House Primrose Street Broadgate London EC2A 2DD
CHAIRMAN'S STATEMENT
Dear Shareholder,
The first phase of exploration drilling in the North Falkland Basin, which began in April 1998, was completed with the Shell well 14/10-1, which was the sixth well drilled. The drilling rig "Borgny Dolphin" has now left the Falklands.
This intensive drilling campaign has |
1 | 60054350_1 | 60054350 | B.Sc., Ph.D., F.G.S., C.Geol., EurGeol.
Secretary Mrs Anna Ruth Neve B.A.
Registered Office Mathon Court Mathon Malvern Worcestershire WR13 5NZ
2
Bankers Barclays Bank plc Swansea Business Centre Pocketts Wharf East Burrows Road Maritime Quarter Swansea SA1 3XL
Standard Chartered Bank Stanley Falkland Islands
Solicitors Osborne Clarke 50 Queen Charlotte Street Bristol BS1 4HE
Auditors Hacker Young Chartered Accountants St James Building 79 Oxford Street Manchester M1 6HT
Registrars IRG plc Balfour House 390-398 High Road Ilford Essex IG1 1NQ
Nominated Adviser and Nominated Broker SG Securities (London) Ltd Exchange House Primrose Street Broadgate London EC2A 2DD
CHAIRMAN'S STATEMENT
Dear Shareholder,
The first phase of exploration drilling in the North Falkland Basin, which began in April 1998, was completed with the Shell well 14/10-1, which was the sixth well drilled. The drilling rig "Borgny Dolphin" has now left the Falklands.
This intensive drilling campaign has produced a considerable amount of data which are now the subject of analysis by all of the companies involved. Although no economic accumulations of hydrocarbons were discovered, the campaign demonstrated the existence of extensive, highquality, hydrocarbon source rocks and good oil shows were encountered in four of the wells. The studies now underway are focused on identifying potential structures with good reservoir development in which the oil generated might be trapped. A fuller technical review is given in the Exploration Report and I will not repeat it here, however, it is worth repeating that all of the factors required for the presence of hydrocarbon accumulations are present in the North Falkland Basin and many prospects remain to be tested.
Unfortunately, overshadowing these prospects is the current, historically-low oil price. This has caused a major reduction in exploration drilling throughout the World and the North Falkland Basin is no exception to this. Additionally, many exploration companies have had to reduce their financial exposures and this has led Desire's partners in the Lasmo Consortium in Tranches C and D to decide to withdraw from the Licences. As a result, Desire will take over 100% of these Tranches and operate them. When this process is completed, Desire will hold 100% of Tranches C, D, I and L |
1 | 60054350_2 | 60054350 | produced a considerable amount of data which are now the subject of analysis by all of the companies involved. Although no economic accumulations of hydrocarbons were discovered, the campaign demonstrated the existence of extensive, highquality, hydrocarbon source rocks and good oil shows were encountered in four of the wells. The studies now underway are focused on identifying potential structures with good reservoir development in which the oil generated might be trapped. A fuller technical review is given in the Exploration Report and I will not repeat it here, however, it is worth repeating that all of the factors required for the presence of hydrocarbon accumulations are present in the North Falkland Basin and many prospects remain to be tested.
Unfortunately, overshadowing these prospects is the current, historically-low oil price. This has caused a major reduction in exploration drilling throughout the World and the North Falkland Basin is no exception to this. Additionally, many exploration companies have had to reduce their financial exposures and this has led Desire's partners in the Lasmo Consortium in Tranches C and D to decide to withdraw from the Licences. As a result, Desire will take over 100% of these Tranches and operate them. When this process is completed, Desire will hold 100% of Tranches C, D, I and L and 12.5% of Tranche F, of which Sodra is the operator.
The processing of the 2,412 kilometres of new seismic acquired on Tranches I and L has been completed and these data are now being interpreted. The results of this interpretation should be available in the next few months.
The Company is now the holder of a very substantial position in the North Falkland Basin, providing considerable flexibility for farm-outs, or other joint ventures, at such time as the oil price recovers and industry interest in the Basin revives. At the moment, it is not possible to say when this will be. Accordingly, your Board will be pursuing a policy of maintaining a low-cost base in this interim period. In addition, it is our intention to consider other, currently-active, opportunities appropriate to the Company. As a consequence of considering a considerable number of these, the Company has made an investment in Gaelic Resources plc (Gaelic) amounting to 4.58% of that Company's issued share capital. Gaelic is exploring for gas in Portugal where there is a ready gas market as, indeed, there is throughout the Iberian Peninsula, and your Board believes this investment to be of the right scale and prospectivity |
1 | 60054350_3 | 60054350 | and 12.5% of Tranche F, of which Sodra is the operator.
The processing of the 2,412 kilometres of new seismic acquired on Tranches I and L has been completed and these data are now being interpreted. The results of this interpretation should be available in the next few months.
The Company is now the holder of a very substantial position in the North Falkland Basin, providing considerable flexibility for farm-outs, or other joint ventures, at such time as the oil price recovers and industry interest in the Basin revives. At the moment, it is not possible to say when this will be. Accordingly, your Board will be pursuing a policy of maintaining a low-cost base in this interim period. In addition, it is our intention to consider other, currently-active, opportunities appropriate to the Company. As a consequence of considering a considerable number of these, the Company has made an investment in Gaelic Resources plc (Gaelic) amounting to 4.58% of that Company's issued share capital. Gaelic is exploring for gas in Portugal where there is a ready gas market as, indeed, there is throughout the Iberian Peninsula, and your Board believes this investment to be of the right scale and prospectivity. The results of the Aljubarotta No.2 well, currently being drilled by Gaelic, should be available soon.
With regard to the Accounts, your Board has taken the view that it would be prudent to write off all expenditure to date with the exception of that relating to seismic data which will, of course, be used in the selection of future drilling locations. In essence, this means that the Board has adopted a form of successful-efforts accounting. Because the Company has no income, other than interest received, this results in a substantial loss for the
3
CHAIRMAN'S STATEMENT
year which will be carried forward. The Company's cash position remains healthy, although there are several substantial costs still outstanding from the drilling programmes.
Gaelic, which the Board believes it would be in the interests of shareholders to pursue, we will certainly take advantage of them, and will advise shareholders accordingly.
Your Board is conscious that Desire is well-placed to consider other opportunities while activity in the Falklands has slowed and that many shareholders wish us to do so. I can assure all shareholders that, should we be presented with opportunities, in addition to the investment in
Yours sincerely,
|
1 | 60054350_b0 | 60054350 | p per share.
This investment amounted to 4.58% of the issued share capital of that company.
25
NOTICE OF THE ANNUAL GENERAL MEETING
Notice is hereby given that the third Annual General Meeting of Desire Petroleum plc will be held at The Reform Club, 104 Pall Mall, London, SW1Y 5EW on 4 May 1999 at 6.00 p.m. for the following purposes:
1. To receive and adopt the Accounts for the year ended 30 September 1998 together with the Report of the Directors and Auditors thereon.
6. To consider and, if thought fit, pass the following resolution which will be proposed as a Special Resolution:
That the Directors be and are hereby authorised in accordance with and subject to the terms of the Company's Articles of Association to allot equity securities for cash up to an aggregate nominal amount of £23,665.
2. To re-elect Sir Rex Hunt as a Director.
3. To re-elect Dr A John Martin as a Director.
4. To re-appoint Hacker Young as Auditors and authorise the Directors to fix their remuneration.
By order of the Board
Mrs Anna R Neve Secretary 9 April 1999
Mathon Court Malvern
WR13 5NZ
5. To consider and, if thought fit, pass the following resolution which will be proposed as an ordinary Resolution:
That the Directors be and are hereby authorised in accordance with and subject to the terms of the Company's Articles of Association to allot relevant securities up to an aggregate nominal amount of £141,990.
Notes:
1. A member entitled to attend and vote at the meeting may appoint one or more proxies to attend and, on a poll, to vote instead of him or her. A proxy need not be a member of the Company.
2. To be valid, the form of proxy must be completed and lodged together with the power of attorney or authority (if any) under which it is signed, or notarially certified copy of such authority, with IRG plc, Balfour House, 390/398 High Road, Ilford, Essex IG1 1NQ, so as to arrive not later than 48 hours before the time fixed for the meeting. Completion and return of a form of proxy will not preclude a member from attending and voting at the meeting if he or she wishes to do so.
26
|
1 | 60054350_b1 | 60054350 | of operating profit/(loss) to net cash outflow from operating activities
1997 £
1998 £
Operating (loss)/profit Intangible assets written off Decrease in debtors Decrease in creditors
66 (272)
(8,357) 8,357
-
Net cash outflow from operating activities
(206)
-
15 Analysis of changes in net funds
Cash at bank Overdrafts
At 1 January
1998 £000
355 -
355
Cash
At 31
Flow December
1998
£000
£000
6,672 (300)
7,027 (300)
6,372
6,727
16 Reconciliation of net cash flow to movement in net funds
Increase in cash in year and change in net funds Net funds brought forward
Net funds carried forward
1997 £000
282 73
355
1998 £000
6,372 355
6,727
17 Post Balance Sheet events
On 23 March 1999 the Company acquired 44,000,000 Ordinary Shares of IR1p in Gaelic Resources plc for Stg 1.25p per share.
This investment amounted to 4.58% of the issued share capital of that company.
25
NOTICE OF THE ANNUAL GENERAL MEETING
Notice is hereby given that the third Annual General Meeting of Desire Petroleum plc will be held at The Reform Club, 104 Pall Mall, London, SW1Y 5EW on 4 May 1999 at 6.00 p.m. for the following purposes:
1. To receive and adopt the Accounts for the year ended 30 September 1998 together with the Report of the Directors and Auditors thereon.
6. To consider and, if thought fit, pass the following resolution which will be proposed as a Special Resolution:
That the Directors be and are hereby authorised in accordance with and subject to the terms of the Company's Articles of Association to allot equity securities for cash up to an aggregate nominal amount of £23,665.
2. To re-elect Sir Rex Hunt as a Director.
3. To re-elect Dr A John Martin as a Director.
4. To re-appoint Hacker Young as Auditors and authorise the Directors to fix their remuneration.
By order of the Board
Mrs Anna R Neve |
1 | 60054396_0 | 60054396 | Nycomed Amersham plc
Te c h n o l o g y f o r t o m o r ro w's t h e r a p i e s
Annual Report and Accounts 1998
Nycomed Amersham is a world leader in in-vivo diagnostic imaging and research-based biotechnology supply.
We are generating technologies to link the frontiers of
bioscience with society's needs for better and more cost
effective healthcare.
Contents
1 Financial highlights 2 Nycomed Amersham an overview 4 Chairman's statement 6 Chief Executive's review 9 A track record in innovation 10 Nycomed Amersham Imaging 14 Amersham Pharmacia Biotech 18 Nycomed Pharma 19 Community and the environment 20 Financial review 23 Board of Directors 24 Financial contents 65 Five year summary 65 Shareholder information 66 Financial calendar 67 Glossary
FC2 Nycomed Amersham plc
©Nycomed Amersham plc 1999 All rights reserved. Registered office Amersham Place, Little Chalfont, Buckinghamshire, England HP7 9NA. Registered in England and Wales 1002610.
http://www.nycomed-amersham.com
Financial highlights
1998 £m
1997 £m
Sales
1,387.4 1,377.5
Operating profit*
260.1
226.7
Nycomed Amersham Imaging
158.9
139.6
Amersham Pharmacia Biotech**
73.4
59.7
Nycomed Pharma
37.7
40.1
Profit before tax
222.8
198.6
Earnings per share*
20.0p
17.6p
Dividends per share
5.3p
4.6p
*Before goodwill amortisation and integration costs. **Including Molecular Dynamics. 12 month equivalent, after share split. The timetable for payment of the final dividend is shown on page 66. Throughout the report, growth is given at constant exchange rates compared with unaudited pro forma 1997 results, unless otherwise stated.
1998 v 1997
% Growth
Actual
Constant
exchange
exchange
1
5
15
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1 | 60054396_1 | 60054396 | Financial highlights
1998 £m
1997 £m
Sales
1,387.4 1,377.5
Operating profit*
260.1
226.7
Nycomed Amersham Imaging
158.9
139.6
Amersham Pharmacia Biotech**
73.4
59.7
Nycomed Pharma
37.7
40.1
Profit before tax
222.8
198.6
Earnings per share*
20.0p
17.6p
Dividends per share
5.3p
4.6p
*Before goodwill amortisation and integration costs. **Including Molecular Dynamics. 12 month equivalent, after share split. The timetable for payment of the final dividend is shown on page 66. Throughout the report, growth is given at constant exchange rates compared with unaudited pro forma 1997 results, unless otherwise stated.
1998 v 1997
% Growth
Actual
Constant
exchange
exchange
1
5
15
20
14
14
23
47
(6)
(4)
12
17
14
18
15
Nycomed Amersham plc 1
Nycomed Amersham an overview
Nycomed Amersham's is divided into Business analysis xxx operating divisions
Imaging,SAalesmersham Pharmacia Biotech Profit before interest & tax and Pharma. Research & development
Imaging £668m
Imaging £159m
Imaging £76m
These have all performed successfully over the last year.
Amersham Pharmacia Biotech £450m
Amersham Pharmacia Biotech £73m
Amersham Pharmacia Biotech £41m
Pharma £270m
Pharma £38m
Pharma £13m
Sales
Europe £583m North America £519m
Japan £208m Asia Pacific £37m Rest of World £41m
Geographical analysis
Number of employees
7,909 Europe 2,239 North America 239 Japan 420 Asia Pacific 38 Rest of World
2 |
1 | 60054396_2 | 60054396 |
20
14
14
23
47
(6)
(4)
12
17
14
18
15
Nycomed Amersham plc 1
Nycomed Amersham an overview
Nycomed Amersham's is divided into Business analysis xxx operating divisions
Imaging,SAalesmersham Pharmacia Biotech Profit before interest & tax and Pharma. Research & development
Imaging £668m
Imaging £159m
Imaging £76m
These have all performed successfully over the last year.
Amersham Pharmacia Biotech £450m
Amersham Pharmacia Biotech £73m
Amersham Pharmacia Biotech £41m
Pharma £270m
Pharma £38m
Pharma £13m
Sales
Europe £583m North America £519m
Japan £208m Asia Pacific £37m Rest of World £41m
Geographical analysis
Number of employees
7,909 Europe 2,239 North America 239 Japan 420 Asia Pacific 38 Rest of World
2 Nycomed Amersham plc
Nycomed Amersham Imaging see pages 10-13
Amersham Pharmacia Biotech see pages 14-17
Nycomed Pharma see page 18
Nycomed Amersham Imaging World leader in the development, manufacture and supply of in-vivo diagnostic imaging agents and radiotherapy products. Our imaging agents improve pictures obtained through medical scans, enabling an early, accurate detection of illnesses such as cancer or heart disease.
Amersham Pharmacia Biotech World leading research-based biotechnology supply company. We work with scientists in industry and academia at all stages of the drug development process from identification of the genes and proteins which can cause disease, to the search for a possible drug, to industrial scale production of the drug itself.
Nycomed Pharma Market leading pharmaceutical company in the Nordic region with a strong presence in Benelux, Central and Eastern Europe. We supply prescription and over-the-counter drugs, in-vitro diagnostics and consumer health products.
X-ray imaging X-ray contrast media such as OmnipaqueTM and VisipaqueTM are injected into the body to give better images of organs and soft tissues during an X |
1 | 60054396_3 | 60054396 | Nycomed Amersham plc
Nycomed Amersham Imaging see pages 10-13
Amersham Pharmacia Biotech see pages 14-17
Nycomed Pharma see page 18
Nycomed Amersham Imaging World leader in the development, manufacture and supply of in-vivo diagnostic imaging agents and radiotherapy products. Our imaging agents improve pictures obtained through medical scans, enabling an early, accurate detection of illnesses such as cancer or heart disease.
Amersham Pharmacia Biotech World leading research-based biotechnology supply company. We work with scientists in industry and academia at all stages of the drug development process from identification of the genes and proteins which can cause disease, to the search for a possible drug, to industrial scale production of the drug itself.
Nycomed Pharma Market leading pharmaceutical company in the Nordic region with a strong presence in Benelux, Central and Eastern Europe. We supply prescription and over-the-counter drugs, in-vitro diagnostics and consumer health products.
X-ray imaging X-ray contrast media such as OmnipaqueTM and VisipaqueTM are injected into the body to give better images of organs and soft tissues during an X-ray.
Magnetic resonance imaging In MRI scanners, a magnetic field is used to `excite' atoms in the body. These atoms are detected with radio waves and the data collected is used to construct an image. Our MRI contrast media, such as OmniscanTM, enhance these images.
Nuclear imaging Nuclear imaging agents consist of gammaemitting radioactive isotopes which concentrate in particular organs or tissues and can be traced using gamma cameras. Our products include MyoviewTM, for studying the heart.
Radiotherapy Our radiotherapy products are used in the treatment of cancer and other conditions such as thyroid disease. Iodine I-125 SeedsTM are used to treat prostate cancer. MetastronTM is injected into cancer patients to relieve bone pain.
Ultrasound The use of ultrasound contrast media such as SonazoidTM (NC100100), currently in development, will enable physicians to see blood flow within organs and thus diagnose heart disease and identify tumours.
Drug discovery applied genomics · DNA sequencing systems such as
MegaBACETM for the identification of genetic material. · Molecular biology tools such as microarrays for the analysis of gene activity and function. · Proteomics technologies for |
1 | 60054396_b0 | 60054396 | changes in demand for the products of Nycomed Amersham worldwide or the markets for those products as well as changes in management's
expectation of the impact of new product launches and the development of new markets, particularly the ultrasound market, and the timing of completion of various trials leading to the introduction of new products; (iii) changes in the cost or supply of raw materials, changes in interest rates and the impact of competition; and (iv) price controls and price reductions, fluctuations in exchange rates for foreign currencies, changes in governmental regulation, and the risk of loss of patents or trademarks. Accordingly, there can be no assurance that the Company will achieve its results projected or implied by the forward-looking statements included in this document. Any reference in this document to the Group's readiness to achieve Year 2000 compliance shall be deemed to comprise a `Year 2000 Readiness Disclosure' for the purposes of the USA Y2k Disclosure Act.
Abdoscan, Actovegin, CalciChew, CalciGran, Ceretec, Clariscan, DaTSCAN, Herbium, I-125 Rapid Strand, I-125 Seeds, Metastron, Myoview, NycoCard, Nycomed Amersham, Omnipaque, Omniscan, Pamol, Sonazoid, TachoComb, Teslascan, Visipaque, Xefo, are trademarks owned by Nycomed Amersham plc or its subsidiaries. ÄKTA, Avalanche, BioProcess, Biotrak, Chromaflow, Cytostar-T, DYEnamic, FPLC, LEADseeker, MegaBACE, OligoProcess, Sephadex, Sepharose, Seq4x4, Source, Storm, Streamline and Thermo Sequenase are trademarks of Amersham Pharmacia Biotech Limited or its subsidiaries. Zurcal/Pantoloc are trademarks owned by Byk Gulden Chemische Fabrik GmbH. Yewtaxan is a trademark owned by YewTree Pharmaceuticals BV.
68 Nycomed Amersham plc
Designed and produced by Merchant with Langsford Corporate Design. Printed by CTD Printers. Board photography by Anita Corbin and John O'Grady. Body shots on cover and overleaves to pages 11,13 15 and 17 by Clare Park. Various images on pages 9 and 17 supplied by The Science Photo Library.
|
1 | 60054396_b1 | 60054396 | 1995 provides a `safe harbor' for forward-looking statements. This document contains forward-looking statements which reflect management's current views with respect to certain future events and financial performance. Such forward-looking statements relate in particular to the outlook for Nycomed Amersham including in particular, potential cost savings as a result of the Nycomed Amersham merger and the merger of the Amersham Life Science business with Pharmacia Biotech, the expected growth of certain of the Group's products or the markets for those products and the adverse impact of currency movements. The Company's ability to achieve its forecasted results depends on many factors which are outside of management's control. Actual results may differ materially from those projected or implied in the forward-looking statements. By their nature, forward-looking statements and forecasts involve risks and uncertainties that could significantly affect expected results because they relate to events and depend on circumstances that will occur in future. The following important factors could cause actual results to differ materially from those projected or implied in any forward-looking statements: (i) unforeseen difficulties in integrating the prospective operations of Amersham and Nycomed as well as the integration of Amersham Pharmacia
Biotech or that the benefits expected from such integration are not realised; (ii) changes in demand for the products of Nycomed Amersham worldwide or the markets for those products as well as changes in management's
expectation of the impact of new product launches and the development of new markets, particularly the ultrasound market, and the timing of completion of various trials leading to the introduction of new products; (iii) changes in the cost or supply of raw materials, changes in interest rates and the impact of competition; and (iv) price controls and price reductions, fluctuations in exchange rates for foreign currencies, changes in governmental regulation, and the risk of loss of patents or trademarks. Accordingly, there can be no assurance that the Company will achieve its results projected or implied by the forward-looking statements included in this document. Any reference in this document to the Group's readiness to achieve Year 2000 compliance shall be deemed to comprise a `Year 2000 Readiness Disclosure' for the purposes of the USA Y2k Disclosure Act.
Abdoscan, Actovegin, CalciChew, CalciGran, Ceretec, Clariscan, DaTSCAN, Herbium, I-125 Rapid Strand, I-125 Seeds, Metastron, Myoview, NycoCard, Nycomed Amersham, Omnipaque |
1 | 60054466_0 | 60054466 | Centrica plc Annual Report 1998
What's important to us
Centrica's vision is clear. We are determined to establish ourselves as the consumer's first choice for energy supply and services.
We're applying all our experience, knowledge and business strength to achieve that aim in the newly competitive energy market. In British Gas, we have a brand that has earned the trust of millions of consumers, giving us a platform from which to expand our offer into areas such as electricity, home security and financial services. Our success so far confirms that this is the right strategy.
Our values remain constant in everything we do. We will continue to provide warmth and comfort, security and expertise to our customers. We will continue to meet our broader responsibilities within society. And we will seek to deepen our understanding of what customers want and to deliver it.
Chairman's statement
1998 was a very important year in the evolution of Centrica as we positioned ourselves to compete in the fast emerging energy market and laid the foundations for future growth.
By the end of May the domestic gas market was fully opened to competition bringing real benefit to customers in the form of freedom of choice and better value.
September saw the start of competition in the domestic electricity market which is expected to be fully opened by June 1999. So far, we are the only major new entrant in this market, which has brought a new dimension to our business. We are delighted with the number of customers choosing British Gas as their electricity supplier and we intend to build on this success. However, certain changes need to take place if competition in the electricity industry is to be fully effective. These include the reform of the electricity pool, increased competition in power generation, separation of supply and distribution and the review of distribution price controls.
For the 20 million domestic customers with both electricity and gas a new market for energy supply is emerging and we aim to be the customer's first choice in this market.
Customer Service Excellent customer service is our first priority and we continue to monitor customer satisfaction levels very closely. The acceleration of the completion of competition in gas brought high levels of customer contact and the process for switching supplier created a substantial additional workload for our customer service centres. Despite this, I am pleased to report that the trend of improvement in customer satisfaction I referred to last year continued during 1998.
£208 million, up £33 million compared with 1997, and earnings were £174 million, £130 million ahead of last year. After allowing for exceptional charges, profit after tax |
1 | 60054466_1 | 60054466 | to be fully opened by June 1999. So far, we are the only major new entrant in this market, which has brought a new dimension to our business. We are delighted with the number of customers choosing British Gas as their electricity supplier and we intend to build on this success. However, certain changes need to take place if competition in the electricity industry is to be fully effective. These include the reform of the electricity pool, increased competition in power generation, separation of supply and distribution and the review of distribution price controls.
For the 20 million domestic customers with both electricity and gas a new market for energy supply is emerging and we aim to be the customer's first choice in this market.
Customer Service Excellent customer service is our first priority and we continue to monitor customer satisfaction levels very closely. The acceleration of the completion of competition in gas brought high levels of customer contact and the process for switching supplier created a substantial additional workload for our customer service centres. Despite this, I am pleased to report that the trend of improvement in customer satisfaction I referred to last year continued during 1998.
£208 million, up £33 million compared with 1997, and earnings were £174 million, £130 million ahead of last year. After allowing for exceptional charges, profit after tax for the year was £89 million, compared with a loss of £791 million in 1997.
Cash generation has continued to be strong, with a cash inflow before money market investments, financing and exceptional payments of £543 million (1997 £877 million).
Dividend While recognising the resources that may be required to develop our strategy, the Board has proposed a distribution to shareholders by way of a special dividend of 12 pence per share together with a consolidation of the share capital, under which ten existing ordinary shares will be consolidated into nine new ordinary shares.
In respect of 1999, the Board intends to propose, in the absence of unforeseen circumstances, a total dividend of 2.5 pence per share.
The Board After 28 years with British Gas and Centrica, Peter Lehmann, Commercial Director, left the Company at the end of December 1998. He made an outstanding contribution during Centrica's formative period, for which we are indebted.
1998 was a testing year for our people, systems and processes. I have been delighted by the positive response to these challenges that I have observed throughout the Group. On behalf of the Board I would like to thank all employees for their contribution to the progress that Centrica has made.
|
1 | 60054466_2 | 60054466 | for the year was £89 million, compared with a loss of £791 million in 1997.
Cash generation has continued to be strong, with a cash inflow before money market investments, financing and exceptional payments of £543 million (1997 £877 million).
Dividend While recognising the resources that may be required to develop our strategy, the Board has proposed a distribution to shareholders by way of a special dividend of 12 pence per share together with a consolidation of the share capital, under which ten existing ordinary shares will be consolidated into nine new ordinary shares.
In respect of 1999, the Board intends to propose, in the absence of unforeseen circumstances, a total dividend of 2.5 pence per share.
The Board After 28 years with British Gas and Centrica, Peter Lehmann, Commercial Director, left the Company at the end of December 1998. He made an outstanding contribution during Centrica's formative period, for which we are indebted.
1998 was a testing year for our people, systems and processes. I have been delighted by the positive response to these challenges that I have observed throughout the Group. On behalf of the Board I would like to thank all employees for their contribution to the progress that Centrica has made.
Performance In 1998 warmer than average weather once again had an adverse impact on sales and profits. Nevertheless, before exceptional charges, group operating profit was
Sir Michael Perry, CBE Chairman
Sir Michael Perry, CBE Chairman Key achievements of the year | strong profit progress | substantial cash generation | encouraging gas market share in tough competitive environment | promising start as electricity supplier | Services business in profit | continued improvement in customer satisfaction levels
Annual Report 1998 | 1
Roy Gardner Chief Executive
Group Earnings before exceptional charges
£m
200
150
100 50
0
-50 -100
-150
-200
-250
96
97
98
2 | Centrica plc
Operating review
Chief Executive's review Our aim is to be the customer's first choice for energy and services to homes and businesses. We have been successful in retaining many of our gas customers and, with the advent of competition in electricity, have made great strides in establishing ourselves in the rapidly converging energy market.
The Chairman has referred to the major changes that occurred during 1998 and against this background I am very pleased with the progress that we have made to develop |
1 | 60054466_3 | 60054466 | Performance In 1998 warmer than average weather once again had an adverse impact on sales and profits. Nevertheless, before exceptional charges, group operating profit was
Sir Michael Perry, CBE Chairman
Sir Michael Perry, CBE Chairman Key achievements of the year | strong profit progress | substantial cash generation | encouraging gas market share in tough competitive environment | promising start as electricity supplier | Services business in profit | continued improvement in customer satisfaction levels
Annual Report 1998 | 1
Roy Gardner Chief Executive
Group Earnings before exceptional charges
£m
200
150
100 50
0
-50 -100
-150
-200
-250
96
97
98
2 | Centrica plc
Operating review
Chief Executive's review Our aim is to be the customer's first choice for energy and services to homes and businesses. We have been successful in retaining many of our gas customers and, with the advent of competition in electricity, have made great strides in establishing ourselves in the rapidly converging energy market.
The Chairman has referred to the major changes that occurred during 1998 and against this background I am very pleased with the progress that we have made to develop the business and to deliver substantially improved financial results.
Our Performance
An overview of our performance is covered below.
Gas British Gas has delivered increased value to its customers, with further price reductions during the year. This has been made possible by increased efficiencies and the continued renegotiation of our `Take or Pay' contracts, which has reduced the cost of the gas that we buy. Our customer propositions, centred around value for money and excellent customer service, resulted in us retaining a share of just over 80% in a domestic market that is now fully competitive. In the industrial and commercial sector we retained about a quarter of the market.
Electricity We have made an excellent start in building our electricity supply business and at the end of the year more than 850,000 customers had signed electricity supply contracts with British Gas, a share of over 3% of the domestic electricity supply market. This rate of growth was substantially ahead of our original expectation and we will continue to invest to sustain this momentum.
Services Our Services business had an excellent year and achieved a profit for the first time with sales up 13%. We gained market share in domestic heating and
maintained our level of annual service contracts, despite our customer losses on the gas supply side |
1 | 60054466_b0 | 60054466 | environment
8-9
Interest
12, 33, 42
Joint ventures and associates
8, 31, 46
Leases
30, 32, 44
Litigation
44
Long Term Incentive Scheme
21, 29, 33, 40
Morecambe gas fields
6, 13
Movement in shareholders' funds
14, 40
Net assets
31
Operating costs
12, 32
Operating profit/(loss)
12, 31
Operating review
2-10
Pensions
20-21, 30, 41, 45-46
Petroleum revenue tax
29, 39
Principal undertakings
47
Profit and loss account
26
Profit Sharing Scheme
24, 33, 40
Provisions for liabilities and charges
39
Reconciliation of debt, cash and money market investments
28
Regulatory considerations
5
Related party transactions
45-46
Remuneration report
18-22
Research and development
23, 29, 32
Reserves
40
Restatements
31
Restructuring costs
33
Retail
2, 3, 7-8, 31
Revocation
11
Risks
6-7, 14, 30, 46
Sales contract loss provisions
30, 32
Segmental analysis
31
Services
2-3, 7, 31
Share information
analysis of shareholdings
48
called up share capital
39-40
consolidation
48
prices
14
substantial shareholdings
24
Sharesave Scheme
22, 24, 40
Stocks
30, 37
Strategy
2-3
`Take or Pay' contracts
7, 30, 37
Taxation
12, 30, 34, 39, 42
Treasury policy
14
Turnover
11, 26, 31
Windfall Tax
12, 31, 33
Year 2000
2, 13, 32-33, 44
|
1 | 60054466_b1 | 60054466 | 32 16-17
11-12, 32 14, 38 23 3 38
1, 4, 7-8 13-14, 37 30, 34, 39
31 29-30, 32, 35-36
21 18-20
22 22 21 20-21 21 23-24 22 25 23-24 1, 23, 26, 34
4 26, 34 2, 4-5, 11
23, 33 33 23
24, 33, 40 24, 40 5-7 4-7, 31 13
Page
European trading
6, 31
Exceptional charges
12, 32-33
Financial calendar
48
Financial instruments
30, 46
Financial review
11-14
Financial services
3, 8
Fixed assets
intangible
29, 35
tangible
13, 29-30, 35, 42
investments
30, 36
Gas contract commitments
45
Goldfish credit card
8
Goldfish guides
8
Goodwill
14, 29, 35
Guarantees
44
Health, safety and the environment
8-9
Interest
12, 33, 42
Joint ventures and associates
8, 31, 46
Leases
30, 32, 44
Litigation
44
Long Term Incentive Scheme
21, 29, 33, 40
Morecambe gas fields
6, 13
Movement in shareholders' funds
14, 40
Net assets
31
Operating costs
12, 32
Operating profit/(loss)
12, 31
Operating review
2-10
Pensions
20-21, 30, 41, 45-46
Petroleum revenue tax
29, 39
Principal undertakings
47
Profit and loss account
26
Profit Sharing Scheme
24, 33, 40
Provisions for liabilities and charges
39
Reconciliation of debt, cash and money market investments
28
Regulatory considerations
5
Related party transactions
45-46
Remuneration report
18-22
Research and development
|
1 | 60054513_0 | 60054513 | Zergo Holdings plc
Annual Report
FOR 8 MONTH PERIOD ENDING 31ST DECEMBER 1998
»
» Baltimore world class security products
and services enabling the e-business and e-commerce revolution.
Contents
Baltimore Global e-Security Specialists 2
Chairman's Statement
4
Baltimore's Business
8
Directors' Report
14
Corporate Governance
22
Report to Shareholders on
Directors' Remuneration
27
Statement of Directors' Responsibilities 29
Report of the Auditor to the Members
of Zergo Holdings plc
30
Consolidated Profit and Loss Account 33
Consolidated Balance Sheet
34
Balance Sheet for Zergo Holdings plc 35
Consolidated Cash Flow Statement 36
Reconciliation of Net Cash Flow to
Movement in Net Debt
36
Reconciliation of Movements in
Shareholders' Funds
37
Statement of Total Recognised
Gains and Losses
37
Notes to the Financial Statements
38
Notice of Annual General Meeting
56
Advisors
58
Glossary
59
Zergo Holdings plc
Baltimore is the new trading name of Zergo Holdings plc 1
Baltimore Global e-Security Specialists
A worldwide customer base
Baltimore locations q Amsterdam q Basingstoke q Boston q Canberra q Dallas q Dublin q Hemel Hempstead q Hong Kong q London q Silicon Valley q Singapore q Stockholm q Sydney q Tokyo q Washington, DC 2
As a leading information security specialist, Baltimore is dedicated to the design and development of security solutions. Our modular, scalable solutions facilitate both entry-level and large-scale deployment and provide the highest levels of commercial security. Our compelling combination of strong design and leading technology means that Baltimore can offer effective solutions for any organisation.
Security The Challenge
The new global culture of electronic information exchange and networking poses a greater threat from fraud, e-mail eavesdropping and data theft to companies and individuals than ever before.
Information security is now a major issue facing today's electronic society. As the information highway transcends borders, locked doors are no longer sufficient to protect one of the corporation's most valuable assets information.
The Internet |
1 | 60054513_1 | 60054513 |
Notice of Annual General Meeting
56
Advisors
58
Glossary
59
Zergo Holdings plc
Baltimore is the new trading name of Zergo Holdings plc 1
Baltimore Global e-Security Specialists
A worldwide customer base
Baltimore locations q Amsterdam q Basingstoke q Boston q Canberra q Dallas q Dublin q Hemel Hempstead q Hong Kong q London q Silicon Valley q Singapore q Stockholm q Sydney q Tokyo q Washington, DC 2
As a leading information security specialist, Baltimore is dedicated to the design and development of security solutions. Our modular, scalable solutions facilitate both entry-level and large-scale deployment and provide the highest levels of commercial security. Our compelling combination of strong design and leading technology means that Baltimore can offer effective solutions for any organisation.
Security The Challenge
The new global culture of electronic information exchange and networking poses a greater threat from fraud, e-mail eavesdropping and data theft to companies and individuals than ever before.
Information security is now a major issue facing today's electronic society. As the information highway transcends borders, locked doors are no longer sufficient to protect one of the corporation's most valuable assets information.
The Internet provides corporations with new and exciting opportunities to develop an additional channel for service delivery. Unfortunately, the lack of security inhibits them from leveraging this medium to its full potential.
Baltimore provides the key to unlock the benefits of a truly secure electronic world.
"I want to congratulate Baltimore Technologies on making this possible"
William Jefferson Clinton President of the USA
On 4 September 1998 Baltimore made e-commerce history when President Clinton and Ireland's Taoiseach Ahern digitally signed an inter-governmental communiqué using security technology provided by Baltimore.
Corporate Profile
Baltimore is one of the world's largest suppliers of e-commerce and enterprise cryptographic security with over 20 years' experience in information security. With hundreds of customers worldwide, our products are used in the most demanding security environments in banking, finance, government, e-commerce and e-business. Baltimore has pioneered the implementation of many of the advanced cryptographic techniques that are now widely embraced, including Public Key Infrastructure (PKI).
Our product range is comprehensive and extremely flexible. Our professional services include consulting, education, training, support and systems integration. Together, they offer customers complete solutions to their information security needs, covering everything from secure e-mail, through Certificate Authorities, to complete enterprise-wide security |
1 | 60054513_2 | 60054513 | provides corporations with new and exciting opportunities to develop an additional channel for service delivery. Unfortunately, the lack of security inhibits them from leveraging this medium to its full potential.
Baltimore provides the key to unlock the benefits of a truly secure electronic world.
"I want to congratulate Baltimore Technologies on making this possible"
William Jefferson Clinton President of the USA
On 4 September 1998 Baltimore made e-commerce history when President Clinton and Ireland's Taoiseach Ahern digitally signed an inter-governmental communiqué using security technology provided by Baltimore.
Corporate Profile
Baltimore is one of the world's largest suppliers of e-commerce and enterprise cryptographic security with over 20 years' experience in information security. With hundreds of customers worldwide, our products are used in the most demanding security environments in banking, finance, government, e-commerce and e-business. Baltimore has pioneered the implementation of many of the advanced cryptographic techniques that are now widely embraced, including Public Key Infrastructure (PKI).
Our product range is comprehensive and extremely flexible. Our professional services include consulting, education, training, support and systems integration. Together, they offer customers complete solutions to their information security needs, covering everything from secure e-mail, through Certificate Authorities, to complete enterprise-wide security architectures.
Baltimore is well positioned to provide worldwide support to our customers. With sales and support offices throughout the US, Europe, Asia and Australia, development centres in Europe and Australia and worldwide alliances with Baltimore Trusted World partners, we offer our customers truly global e-security.
Zergo Holdings plc
Baltimore is the new trading name of Zergo Holdings plc 3
Chairman's Statement
The PKI market is forecast to grow rapidly over the next two years and I believe that as we successfully complete the integration of Zergo and Baltimore the combined Group will be well positioned to be one of the small number of leading suppliers to this market.
"Last year I explained that our strategy would be to prioritise investment for growth rather than profits as we concentrated on developing fully packaged products and establishing sales channels. The objective of this strategy is to generate long term shareholder value and we believe this is best " served by the strategy of growing revenue and winning market share together with ensuring competitive products through a high research & development spend. During the past year we have made significant progress towards achieving this goal. The calendar year 1998 has been a year of great change and progress with the acquisition of Security
Domain (completed in March 1998) |
1 | 60054513_3 | 60054513 | architectures.
Baltimore is well positioned to provide worldwide support to our customers. With sales and support offices throughout the US, Europe, Asia and Australia, development centres in Europe and Australia and worldwide alliances with Baltimore Trusted World partners, we offer our customers truly global e-security.
Zergo Holdings plc
Baltimore is the new trading name of Zergo Holdings plc 3
Chairman's Statement
The PKI market is forecast to grow rapidly over the next two years and I believe that as we successfully complete the integration of Zergo and Baltimore the combined Group will be well positioned to be one of the small number of leading suppliers to this market.
"Last year I explained that our strategy would be to prioritise investment for growth rather than profits as we concentrated on developing fully packaged products and establishing sales channels. The objective of this strategy is to generate long term shareholder value and we believe this is best " served by the strategy of growing revenue and winning market share together with ensuring competitive products through a high research & development spend. During the past year we have made significant progress towards achieving this goal. The calendar year 1998 has been a year of great change and progress with the acquisition of Security
Domain (completed in March 1998) and the acquisition of Baltimore Technologies (completed on
11 January 1999).
Henry Beker Chairman and Chief Executive, Zergo Holdings plc
The table below illustrates the growth of the enlarged Group on an unaudited pro forma basis.
At 31 December 1997
At 31 December 1998
Employees Market capitalisation Offices worldwide
120 £20m
3
337 £117m
11
We have decided to change the financial year-end from 30 April to 31 December to make it easier for our investors to compare our performance with that of our competitors.
In our market place revenue is one of the key factors in determining the value of the Company. Group revenues for the eight months to 31 December 1998 were £9.9m (1997 unaudited: £6.9m), representing an increase of 43%.
Unaudited pro forma Group revenues for the 12 months to 31 December 1998 for the combined entity of Baltimore, Security Domain and Zergo would have been £18.8m.
Pre-tax profits will continue to be adversely affected by the accounting treatment of goodwill write-off as we begin to account for the acquisitions of Security Domain and Baltimore Technologies. Therefore |
1 | 60054513_b0 | 60054513 | England and Wales under the Companies Act 1985 no. 2643615
58
Glossary
Terms used in UK report and accounts US equivalents or definitions
Accounts Associated undertakings
Capital allowances Creditors
Creditors: amounts falling due within one year Creditors: amounts falling due after more than one year
Finance lease Fixed asset investments
Other debtors Profit Income Profit and loss account (statement)
Profit and loss account (under "share capital and reserves" in balance sheet)
Provisions
Reserves Share premium account
Shareholders' funds Stocks
Tangible fixed assets Trade debtors Turnover
Financial statements Equity investees Tax depreciation Accounts payable and accrued liabilities Current liabilities Long-term liabilities Capital lease Non-current investments Other current assets Income statement Retained earnings
Long-term liabilities other than debt and specific accounts payable Shareholders' equity other than paid-up capital Additional paid-in capital or paid-in surplus (not distributable) Shareholders' equity Inventories Property, plant and equipment Accounts receivable (net) Revenues
Zergo Holdings plc
59
Europe, Middle East & Africa United Kingdom The Square, Basing View, Basingstoke, Hampshire RG21 4EG T +44 1442 342600 F +44 1256 812901
Ireland IFSC House, Int. Financial Services Centre Custom House Quay, Dublin 1 T +353 1 605 4399 F +353 1 605 4388
The Netherlands Omega Park, Zekeringstraat 39D, 1014 BV Amsterdam T +31 20 5 829 829 F +31 20 6 847 196
Americas
USA 101 East Park Boulevard, 6th Floor, Plano, TX 75074 T +1 972 516 3744 F +1 972 516 3745
Boston, MA T +1 617 371 2933
Washington DC T +1 703 876 0600
Mountain View, CA T +1 650 943 2320
Asia Pacific
Australia 5th Floor, 1 James Place, North Sydney, NSW 2060 T +61 2 9409 0300 F +61 2 9409 0301
Canberra T +61 2 6260 5677
Singapore Level 37, Singapore Land Tower, 50 Raffles Place, Singapore T +65 320 8408 F +65 320 8409
© Zergo Holdings plc 1999
|
1 | 60054513_b1 | 60054513 | : The Square, Basing View Basingstoke, Hampshire RG21 4EG
Dated 30 March 1999
NOTE: A Member of the Company entitled to attend and vote at the above Meeting may appoint a proxy to attend and vote in his stead. A Proxy need not be a Member of the Company.
Zergo Holdings plc
57
Advisors
Head Office Zergo Holdings plc The Square, Basing View Basingstoke RG21 4EG
Investor Enquiries Simon Enoch Company Secretary T +44 1256 818 800 senoch@baltimore.com
Legal Advisors Lovell White Durrant 65 Holborn Viaduct London EC1A 2DY T +44 171 236 0066
Rogers & Wells LLP City Tower 40 Basinghall Street London EC2V 5DE T +44 171 628 0101
Registered Auditor KPMG Audit Plc Arlington Business Park Theale Reading RG7 4SD T +44 118 964 2000
Registrars IRG plc Balfow House 390-398 High Road Ilford Essex IG1 1NQ T +44 181 639 2000
Incorporated and registered in England and Wales under the Companies Act 1985 no. 2643615
58
Glossary
Terms used in UK report and accounts US equivalents or definitions
Accounts Associated undertakings
Capital allowances Creditors
Creditors: amounts falling due within one year Creditors: amounts falling due after more than one year
Finance lease Fixed asset investments
Other debtors Profit Income Profit and loss account (statement)
Profit and loss account (under "share capital and reserves" in balance sheet)
Provisions
Reserves Share premium account
Shareholders' funds Stocks
Tangible fixed assets Trade debtors Turnover
Financial statements Equity investees Tax depreciation Accounts payable and accrued liabilities Current liabilities Long-term liabilities Capital lease Non-current investments Other current assets Income statement Retained earnings
Long-term liabilities other than debt and specific accounts payable Shareholders' equity other than paid-up capital Additional paid-in capital or paid-in surplus (not distributable) Shareholders' equity Inventories Property, plant and equipment Accounts receivable (net) Revenues
Zergo Holdings plc
59
Europe, Middle East & Africa United Kingdom The Square, Basing View, B |
1 | 60054544_0 | 60054544 | Bowthorpe Report and Accounts 1998
Bowthorpe plc is the parent company of a growing international technology group focused on the design, development, manufacture and marketing of specialist electronic products. Customers include leading organisations in markets such as aerospace, automotive, computer, construction and telecommunications. Bowthorpe provides state-of-the-art electronic solutions in rapidly growing technology areas, such as high speed digital communications and aerospace information management.
Contents
1 Financial Highlights 2 Group Profile 3 Chairman's and Chief Executive's Review 6 Board of Directors 7 Operations Management 8 Network Management 10 Interconnection 12 Systems 14 Cable Management 16 Sensing 18 Financial Review 21 Directors' Statement on Corporate Governance 26 Report of the Directors 29 Report on Directors' Remuneration 33 Statement of Directors' Responsibilities in respect of the Accounts 34 Report of the Auditors 35 Consolidated Profit and Loss Account 36 Consolidated Statement of Total Recognised Gains and Losses
Reconciliation of Movements in Shareholders' Funds 37 Consolidated Balance Sheet 38 Consolidated Cash Flow Statement 39 Balance Sheet of the Company 40 Notes to the Accounts 60 Principal Divisions, Subsidiary and Associated Undertakings 64 Financial History 66 Shareholder Information 68 Financial Calendar
Advisers ibc Global Presence
Financial Highlights
£million
Turnover Operating Profit Profit before Taxation Profit after Taxation Profit Attributable to Shareholders Basic Earnings per Share (pence) Headline Earnings per Share (pence) Dividend per Share (pence)
1998 587.6
92.9 92.1 59.9 53.9 26.75 27.20 12.28
1997 540.6
82.5 85.5 57.3 51.2 26.23 26.23 11.23
417.6 470.4 524.9 540.6 587.6
63.3 72.7 78.4 82.5 92.9
19.87 23.00 24.99 26.23 27.20
8.25 9.50 10.17 11.23 12.28
94 95 96 97 98
Turnover
£million
94 95 96 97 98
Operating Profit
£million
94 95 96 97 98
Headline Earnings per Share
pence
94 95 96 97 98
Dividend per Share
pence
Bowthorpe Report and Accounts 1998 1
Group Profile |
1 | 60054544_1 | 60054544 | Presence
Financial Highlights
£million
Turnover Operating Profit Profit before Taxation Profit after Taxation Profit Attributable to Shareholders Basic Earnings per Share (pence) Headline Earnings per Share (pence) Dividend per Share (pence)
1998 587.6
92.9 92.1 59.9 53.9 26.75 27.20 12.28
1997 540.6
82.5 85.5 57.3 51.2 26.23 26.23 11.23
417.6 470.4 524.9 540.6 587.6
63.3 72.7 78.4 82.5 92.9
19.87 23.00 24.99 26.23 27.20
8.25 9.50 10.17 11.23 12.28
94 95 96 97 98
Turnover
£million
94 95 96 97 98
Operating Profit
£million
94 95 96 97 98
Headline Earnings per Share
pence
94 95 96 97 98
Dividend per Share
pence
Bowthorpe Report and Accounts 1998 1
Group Profile
Bowthorpe's expertise is concentrated within five groups in which it brings together businesses with related technology or shared customers, encouraging them to develop potential synergies through co-operation These groups form the focus of achieving Bowthorpe's Vision:
We will be the global leader in selected markets by providing creative solutions which improve the performance of customers' complex electrical and electronic systems
Network Management
· Telecommunications innovative, high performance test solutions for developers, manufacturers and evaluators of telecommunications equipment, and for operators of telecommunications networks
· Power Management world class power control devices for electric wheelchairs and mobility scooters; standard, configurable and custom-designed power supplies for telecommunications, medical, industrial and specialist applications; high and low voltage surge suppression equipment for markets including electricity supply and distribution, and consumer electronics
Interconnection
· Terminal blocks and connectors a wide range of innovative electrical wiring solutions using pioneering CageClamp spring pressure terminal technology, which provides an alternative to conventional wire securing techniques
· Process control award-winning system of fieldbus-independent electronic modules and interface units for the distributed control of automated processes
Serves markets including automotive, construction, petrochemical, railways and shipbuilding
Systems
· Transportation a wide range of |
1 | 60054544_2 | 60054544 |
Bowthorpe's expertise is concentrated within five groups in which it brings together businesses with related technology or shared customers, encouraging them to develop potential synergies through co-operation These groups form the focus of achieving Bowthorpe's Vision:
We will be the global leader in selected markets by providing creative solutions which improve the performance of customers' complex electrical and electronic systems
Network Management
· Telecommunications innovative, high performance test solutions for developers, manufacturers and evaluators of telecommunications equipment, and for operators of telecommunications networks
· Power Management world class power control devices for electric wheelchairs and mobility scooters; standard, configurable and custom-designed power supplies for telecommunications, medical, industrial and specialist applications; high and low voltage surge suppression equipment for markets including electricity supply and distribution, and consumer electronics
Interconnection
· Terminal blocks and connectors a wide range of innovative electrical wiring solutions using pioneering CageClamp spring pressure terminal technology, which provides an alternative to conventional wire securing techniques
· Process control award-winning system of fieldbus-independent electronic modules and interface units for the distributed control of automated processes
Serves markets including automotive, construction, petrochemical, railways and shipbuilding
Systems
· Transportation a wide range of data gathering, data analysis and information management solutions for the aerospace industry, used by many of the world's leading airlines and defence organisations
· Environmental sensors and software for the measurement and recording of environmental pollution, supplied to government and industry
· Pharmaceutical industry-leading thermal validation equipment for pharmaceutical and biotechnology industries
Cable Management
A world leader in systems and solutions for the safe and efficient management of cables, wires and components: · Fixings ties, application tools, clips and accessories for bundling and securing cables · Routing and organising systems for the distribution of fibre optic and copper cables · Identification products for identifying cables and components within complex systems · Insulation low and medium voltage wire insulation products Serves markets including automotive, construction, power generation and distribution, switch and control gear, and telecommunications
Sensing
· Sensors a broad portfolio of advanced temperature, humidity, moisture, pressure and position sensors and transmitters. Serves leading organisations in markets such as automotive, construction, heating ventilation and air conditioning, medical and telecommunications
· Thermal Management high quality heatsinks, substrates, insulators, mounting kits and assemblies for semiconductors, power hybrid circuits, high power electronics and other devices. Applications include aerospace, automotive, |
1 | 60054544_3 | 60054544 | data gathering, data analysis and information management solutions for the aerospace industry, used by many of the world's leading airlines and defence organisations
· Environmental sensors and software for the measurement and recording of environmental pollution, supplied to government and industry
· Pharmaceutical industry-leading thermal validation equipment for pharmaceutical and biotechnology industries
Cable Management
A world leader in systems and solutions for the safe and efficient management of cables, wires and components: · Fixings ties, application tools, clips and accessories for bundling and securing cables · Routing and organising systems for the distribution of fibre optic and copper cables · Identification products for identifying cables and components within complex systems · Insulation low and medium voltage wire insulation products Serves markets including automotive, construction, power generation and distribution, switch and control gear, and telecommunications
Sensing
· Sensors a broad portfolio of advanced temperature, humidity, moisture, pressure and position sensors and transmitters. Serves leading organisations in markets such as automotive, construction, heating ventilation and air conditioning, medical and telecommunications
· Thermal Management high quality heatsinks, substrates, insulators, mounting kits and assemblies for semiconductors, power hybrid circuits, high power electronics and other devices. Applications include aerospace, automotive, computer, medical and telecommunications
2 Bowthorpe Report and Accounts 1998
Chairman's and Chief Executive's Review
In 1998, Bowthorpe's earnings from telecoms testing activities grew significantly. While turnover and profit increased in all groups, Network Management achieved a particularly strong performance, largely due to major demand from telecoms equipment manufacturers and network operators.
Nicholas Brookes (left), and Anthony Vice
Results overview Turnover increased by nine per cent to £587.6 million. Operating profit, before goodwill amortisation of £0.9 million, increased by 14 per cent to £93.8 million. Currency translation effects lowered growth rates by two per cent, reducing turnover by £12.4 million and profit before taxation by £1.7 million.
Return on sales, before goodwill amortisation, rose to 16.0 per cent (1997 15.3 per cent). Basic earnings per share in 1998 increased slightly to 26.75 pence (1997 26.23 pence), while headline earning per share increased to 27.20 pence (1997 26.23 pence). This lower rate of growth in headline earnings per share reflects the impact of the greater number of shares in issue, principally as a |
1 | 60054544_b0 | 60054544 | Accounts 1998 67
Financial Calendar
1999
Annual General Meeting Final dividend 1998
Preliminary announcement of results for half year to 30 June 1999 Interim dividend 1999
Financial year-end
2000 (provisional)
Preliminary announcement of 1999 results Final dividend 1999 *Dividend Reinvestment Plan (see details page 66)
20 May
ex-dividend record
*DRIP mandate payment
22 March 26 March 10 June 1 July
9 September
ex-dividend record
*DRIP mandate payment
20 September 24 September 16 November 7 December
31 December
March payment June
Advisers
Banker Midland Bank plc Legal Advisers Linklaters & Alliance (UK) Debevoise & Plimpton (USA) Brokers Cazenove & Co Salomon Smith Barney
Financial Adviser N M Rothschild & Sons Limited
Auditor Ernst & Young Becket House 1 Lambeth Palace Road London SE1 7EU Tel: +44 (0)171 928 2000
Registrar Lloyds TSB Registrars The Causeway Worthing West Sussex BN99 6DA Tel: +44 (0)1903 502541
Life President Raymond A Parsons CBE
68 Bowthorpe Report and Accounts 1998
Global Presence
Canada
Hawaii
Wisconsin Minnesota
Illinois Massachusetts
Pennsylvania New York
Colorado
New Jersey
Kansas Maryland
Texas
California
Florida
Mexico
Puerto Rico
Sweden
Norway
Finland
United Kingdom
Ireland
Germany Poland
Czech Republic
France Austria Switzerland
Hungary
Spain
ItalySlovenia
Brazil
South Africa
China
Korea Japan
India
Hong Kong
Thailand Philippines
Malaysia Singapore
Australia
Creative solutions in electronics, worldwide.
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Bowthorpe plc Gatwick Road, Crawley, West Sussex RH10 2RZ United Kingdom Telephone +44 (0)1293 528888 Fax +44 (0)1293 541905 www.bowthorpe.com
|
1 | 60054544_b1 | 60054544 | per minute at all times. The share price is also broadcast on BBC Ceefax page 222 and on Channel 4 Teletext page 511. Corporate Website (www.bowthorpe.com) The Bowthorpe website provides financial and other information about the Company and direct links to other Group company sites. Capital Gains Tax The market value of the Company's Ordinary shares at 31 March 1982 for the purposes of UK Capital Gains Tax purposes was 118.095 pence per share (as adjusted for subsequent capitalisation and rights issues). Registered Office and Number The Company has its registered office at Gatwick Road, Crawley, West Sussex RH10 2RZ and is registered in England No. 470893. Telephone +44 (0)1293 528888, Fax +44 (0)1293 541905. Annual General Meeting The Annual General Meeting will be held at 12 noon Thursday 20 May 1999 in Smeaton's Vaults, The Brewery, Chiswell Street, London EC1Y 4SD. A circular to shareholders containing a letter from the Chairman, the Notice of Annual General Meeting together with an explanation of Special Business and a reply-paid Form of Proxy, accompany this document.
Bowthorpe Report and Accounts 1998 67
Financial Calendar
1999
Annual General Meeting Final dividend 1998
Preliminary announcement of results for half year to 30 June 1999 Interim dividend 1999
Financial year-end
2000 (provisional)
Preliminary announcement of 1999 results Final dividend 1999 *Dividend Reinvestment Plan (see details page 66)
20 May
ex-dividend record
*DRIP mandate payment
22 March 26 March 10 June 1 July
9 September
ex-dividend record
*DRIP mandate payment
20 September 24 September 16 November 7 December
31 December
March payment June
Advisers
Banker Midland Bank plc Legal Advisers Linklaters & Alliance (UK) Debevoise & Plimpton (USA) Brokers Cazenove & Co Salomon Smith Barney
Financial Adviser N M Rothschild & Sons Limited
Auditor Ernst & Young Becket House 1 Lambeth Palace Road London SE1 7EU Tel: +44 (0)171 928 2000
Registrar Lloyds TSB Registrars The Causeway Worthing West Sussex BN99 6DA Tel: +44 ( |
1 | 60054585_0 | 60054585 | Anglo Pacific Group PLC
Report and Accounts 1998
Anglo Pacific Group PLC
CONTENTS
Directors and advisers Chairman's review Report of the directors Corporate governance statement Remuneration committee report Reports of the auditors Pro forma consolidated profit and loss account Pro forma balance sheet Consolidated profit and loss account Balance sheets Consolidated cash flow statement Notes to the accounts Shareholder statistics
Page 2 3 5 9
11 12 13 13 14 15 16 18 31
1
Anglo Pacific Group PLC
DIRECTORS P.M. BOYCOTT (Chairman) M. CHANARIN H. MICHAELIS (Corporate Development Director) W.M. RUSHBROOKE B.M. WIDES (Finance Director)
SECRETARY V. SIMMONS
HEAD OFFICE
PO BOX 14774, TILLICOULTRY, SCOTLAND FK13 6YF Tel: 01259 754700 Fax: 01259 752622
REGISTERED OFFICE
29 ALBEMARLE STREET, LONDON W1X 3FA Registered in England No. 897608
AUDITORS
KIDSONS IMPEY Breckenridge House, 274 Sauchiehall Street, Glasgow G2 3EH
BANKERS
REGISTRARS
BARCLAYS BANK PLC Hanover Square Corporate Banking Centre
8/9 Hanover Square London W1A 4ZW
COMPUTERSHARE SERVICES plc Owen House
8 Bankhead Crossway North Edinburgh EH11 4BR
STOCKBROKERS
BELL LAWRIE WHITE & CO 48 St Vincent Street Glasgow G2 5TS
2
Anglo Pacific Group PLC
Annual Report 1998
CHAIRMAN'S REVIEW
I am pleased to say the Group's results are much improved compared to last year. We will be paying a dividend on 30th July 1999 of 0.1p net per share to shareholders on the register on 2nd July 1999.
Anglo Pacific Group PLC made a profit before tax of »895,000 compared with »297,000 for 1997 after accelerated deprecation and provision reversals from last year's results are excluded. This is an increase of 301%. Turnover has increased by 8.4% from »4,024,000 to »4,362 |
1 | 60054585_1 | 60054585 | S IMPEY Breckenridge House, 274 Sauchiehall Street, Glasgow G2 3EH
BANKERS
REGISTRARS
BARCLAYS BANK PLC Hanover Square Corporate Banking Centre
8/9 Hanover Square London W1A 4ZW
COMPUTERSHARE SERVICES plc Owen House
8 Bankhead Crossway North Edinburgh EH11 4BR
STOCKBROKERS
BELL LAWRIE WHITE & CO 48 St Vincent Street Glasgow G2 5TS
2
Anglo Pacific Group PLC
Annual Report 1998
CHAIRMAN'S REVIEW
I am pleased to say the Group's results are much improved compared to last year. We will be paying a dividend on 30th July 1999 of 0.1p net per share to shareholders on the register on 2nd July 1999.
Anglo Pacific Group PLC made a profit before tax of »895,000 compared with »297,000 for 1997 after accelerated deprecation and provision reversals from last year's results are excluded. This is an increase of 301%. Turnover has increased by 8.4% from »4,024,000 to »4,362,000.
Our focus during the last twelve months has been the increase in the productive capacity of both wet and dry plants at Fife Silica Sands. Such expansion helps us produce and sell substantially more higher value products. Sales of wet sand to glass bottle manufacturers are robust despite less demand for glass containers. The market has responded well to our new high value products. We have continued to prove up our silica sand mineral deposit at Burrowine Moor in terms of extensive drilling of the resource. Furthermore, we have expanded and improved our planning permissions.
At Ledmore Marble we continue to research and develop the market for our products, but are determined to keep costs down in our search to achieve a good return from this resource. The potential demand for high value decorative and landscape products is substantial.
We continue to improve the resource at Shetland Talc. We have renegotiated the leases and other local agreements. Several outside parties are interested in jointly developing or buying this deposit.
The royalty income from the two Australian coal mines has increased compared to last year. The Crinum mine, operated by Broken Hill Proprietary, has achieved record levels of production albeit with lower world coal prices and a weak Australian dollar. The Gordonstone mine, which had been |
1 | 60054585_2 | 60054585 | ,000.
Our focus during the last twelve months has been the increase in the productive capacity of both wet and dry plants at Fife Silica Sands. Such expansion helps us produce and sell substantially more higher value products. Sales of wet sand to glass bottle manufacturers are robust despite less demand for glass containers. The market has responded well to our new high value products. We have continued to prove up our silica sand mineral deposit at Burrowine Moor in terms of extensive drilling of the resource. Furthermore, we have expanded and improved our planning permissions.
At Ledmore Marble we continue to research and develop the market for our products, but are determined to keep costs down in our search to achieve a good return from this resource. The potential demand for high value decorative and landscape products is substantial.
We continue to improve the resource at Shetland Talc. We have renegotiated the leases and other local agreements. Several outside parties are interested in jointly developing or buying this deposit.
The royalty income from the two Australian coal mines has increased compared to last year. The Crinum mine, operated by Broken Hill Proprietary, has achieved record levels of production albeit with lower world coal prices and a weak Australian dollar. The Gordonstone mine, which had been the subject of an employee lockout by its previous owners, Atlantic Richfield, was sold to RTZ at the end of last year. RTZ has restarted limited production and hopes to work up to full production levels later on in the year.
We retain an interest in Brancote Holdings PLC which has been affected by the low rating of the mining sector and the outlook for base metal prices and the price of gold. Brancote's activities are focused on its Argentine gold interests which are being developed by new management.
During this last year we have completed the overhaul of the Group's financial, security, business software and operating systems. We have refurbished and re-let the Edinburgh office These actions have helped to reduce overheads. During the year Kidsons Impey were appointed as our new Auditors and Bell Lawrie White and Co. as our Financial Advisers and Sponsoring Broker.
At the AGM held on 9th July 1998, shareholders inter alia gave the Company authority to buy its own shares in the market and to reduce its share capital subject to certain conditions. After the Company took further professional advice it was found that it was not necessary to implement the capital reduction nor to apply to the High Court as the values of the |
1 | 60054585_3 | 60054585 | the subject of an employee lockout by its previous owners, Atlantic Richfield, was sold to RTZ at the end of last year. RTZ has restarted limited production and hopes to work up to full production levels later on in the year.
We retain an interest in Brancote Holdings PLC which has been affected by the low rating of the mining sector and the outlook for base metal prices and the price of gold. Brancote's activities are focused on its Argentine gold interests which are being developed by new management.
During this last year we have completed the overhaul of the Group's financial, security, business software and operating systems. We have refurbished and re-let the Edinburgh office These actions have helped to reduce overheads. During the year Kidsons Impey were appointed as our new Auditors and Bell Lawrie White and Co. as our Financial Advisers and Sponsoring Broker.
At the AGM held on 9th July 1998, shareholders inter alia gave the Company authority to buy its own shares in the market and to reduce its share capital subject to certain conditions. After the Company took further professional advice it was found that it was not necessary to implement the capital reduction nor to apply to the High Court as the values of the various assets held by the Anglo Pacific Group PLC, and in particular Fife Silica Sands, had been written down in the last ten years under the previous management to well below their original cost. These write downs had been made against revenue reserves. By reinstating original costs, because there had been no permanent impairment of the assets in question, the revenue reserves deficit has been eliminated.
3
Anglo Pacific Group PLC Annual Report 1998
CHAIRMAN'S REVIEW We can now pay dividends and buy our own shares. In August 1998 we spent »168,000 on 1,225,000 shares at prices of between 13p and 14p per share. I would like to thank all our staff and my fellow Directors for their hard work and dedication during a year of management change and expansion in operations. Because of the investment made in operating plant and product development, we are confident of improving results by the sale of more higher value added products. We will continue to look at potential acquisitions. P.M. BOYCOTT Chairman 16th March 1999
4
Anglo Pacific Group PLC
REPORT OF THE DIRECTORS FOR THE YEAR ENDED 31st DECEMBER 1998
The directors present their report together with audited consolidated accounts |
1 | 60054585_b0 | 60054585 |
In one year or less
319
Between one and five years
726
1,045
1997 »000's
136 247
383
Obligations for repayments under operating leases comprise:ö
Annual commitments in respect of leases which expire: between one and five years
1998 »000's
22
22
Subsidiary undertakings have commitments as detailed below:ö
Fife Silica Sands Limited A bond was granted to Dunfermline District Council for »200,000 in August 1988 relating to the extraction of minerals and the restoration to agricultural use of part of Burrowine Moor, Culross, Fife. A bond was granted to the Forestry commission for »20,000 in December 1990, in respect of re-instating the site at Burrowine Moor Quarry, Bogside Wood, Devilla.
Ledmore Marble Limited A bond was granted to the Secretary of State for Scotland for »50,000 in May 1988. The bond is in respect of a prospecting and option agreement to explore and search for minerals at Ledmore Forest, Sutherland.
Shetland Talc Limited A bond was granted to Shetland Islands Council for »10,000 in respect of the installation of a Talc processing plant at Broonies Taing Sandwick, and the extraction of talc magnesite rock at Catpund, Cunningsburgh.
30
Anglo Pacific Group PLC
SHAREHOLDER STATISTICS
a) Size of Holding (at 17th March 1999)
Category
Number of Shareholders
1^ 1,000
703
1,001^ 5,000
612
5,001^10,000
119
10,001^and over
279
1,713
% 41.04 35.73
6.95 16.28
100.00
Number of Shares
447,857 1,501,924
992,449 81,520,725
%
0.53 1.78 1.17 96.52
84,462,955 100.00
b) The percentage of total shares held by or on behalf of the twenty largest shareholders as at 17th March 1999 was 71.89%.
31
Pillans & Wilson Greenaway, Edinburgh 12796
|
1 | 60054585_b1 | 60054585 | (168)
(168)
At 31st December 1998
(3,027)
3,382
1997
Group Company
»000's
»000's
(6,702) (8,420)
2,042 ö
(4,660)
(15) ö
(8,435)
20. Reconciliation of movements in equity shareholders' funds
Profit for the financial year Movement in foreign exchange reserve Increase in share capital Increase in share premium Increase in revaluation reserve Ordinary shares redeemed
Net increase in shareholders' funds At 1st January
At 31st December
1998 »000's 1,801
(25) ö ö 1,606 (168)
3,214 6,500
9,714
1997 »000's 2,042
51 400 401
ö ö
2,894 3,606
6,500
29
Anglo Pacific Group PLC
NOTES TO THE ACCOUNTS
21. Financial commitments
Obligations for capital repayments under finance leases comprise:ö
1998 »000's
In one year or less
319
Between one and five years
726
1,045
1997 »000's
136 247
383
Obligations for repayments under operating leases comprise:ö
Annual commitments in respect of leases which expire: between one and five years
1998 »000's
22
22
Subsidiary undertakings have commitments as detailed below:ö
Fife Silica Sands Limited A bond was granted to Dunfermline District Council for »200,000 in August 1988 relating to the extraction of minerals and the restoration to agricultural use of part of Burrowine Moor, Culross, Fife. A bond was granted to the Forestry commission for »20,000 in December 1990, in respect of re-instating the site at Burrowine Moor Quarry, Bogside Wood, Devilla.
Ledmore Marble Limited A bond was granted to the Secretary of State for Scotland for »50,000 in May 1988. The bond is in respect of a prospecting and option agreement to explore and search for minerals at Ledmore Forest, Sutherland.
Shetland Talc Limited A bond was granted to Shetland Islands Council for »10 |
1 | 60054676_0 | 60054676 | Vanguard Medica Group plc 1998 Annual Report and Accounts
Vanguard Medica Group plc
1998 Annual Report and Accounts
Vanguard Medica Annual Report 1998
Our achievements
1998 has been an important year in the evo of regulatory dossiers for frovatriptan in both new collaborative agreements on substantia important step in our transition from beingan towards one with a marketed product, genera
Contents 2 From the Chairman and the Chief Executive 8 Review of the Portfolio 16 Directors 18 Finance Review 19 Advisers 20 Directors' Report 23 Remuneration Report 30 Corporate Governance 33 Auditors' Report 34 Consolidated Profit and Loss Account 34 Statement of Group total recognised Gains and Losses 35 Balance Sheets 36 Consolidated Cash Flow Statement 37 Notes to the Financial Statements 48 Notice of Annual General Meeting 51 Glossary
lution of Vanguard. The successful filing
h the US and Europe, together with three
ally better financial terms, marked an
n early-stage development company
ating revenues.
NDA filing for frovatriptan MAA filing for frovatriptan Elan announced as new commercialisation partner for frovatriptan in the key North American markets. Elan deal is approved by US government and Elan makes payments totalling US$17.5 million to Vanguard. Collaboration with Roche to develop an endothelin antagonist, VML 588, in two indications the treatment of sub-arachnoid haemorrhage and the prevention of acute renal failure. Collaboration with 3M Pharmaceuticals to develop VML 600, an Immune Response Modifier, for the treatment of hepatitis C.
2 l 3 Vanguard Medica Annual Report 1998
From the Chairman and the Chief Executive
It is an outstanding testament to the Vanguard organisation that we have achieved the filing of an NDA in just over
four years with a dedicated team of well-focused professionals.
Dr Roger Brimblecombe Chairman
1998 was a challenging year for Vanguard and for the sector as a whole. Despite some setbacks we made strong progress. Of particular note was the filing of our first New Drug Application (NDA) in January 1999 for frovatriptan, followed only weeks later by the MAA regulatory filing. We also added two exciting new compounds to the portfolio in October and December.
In October Simon Cartmell joined from GlaxoWellcome as our Chief Operating Officer. He has responsibility for Vanguard's commercial activities |
1 | 60054676_1 | 60054676 | by US government and Elan makes payments totalling US$17.5 million to Vanguard. Collaboration with Roche to develop an endothelin antagonist, VML 588, in two indications the treatment of sub-arachnoid haemorrhage and the prevention of acute renal failure. Collaboration with 3M Pharmaceuticals to develop VML 600, an Immune Response Modifier, for the treatment of hepatitis C.
2 l 3 Vanguard Medica Annual Report 1998
From the Chairman and the Chief Executive
It is an outstanding testament to the Vanguard organisation that we have achieved the filing of an NDA in just over
four years with a dedicated team of well-focused professionals.
Dr Roger Brimblecombe Chairman
1998 was a challenging year for Vanguard and for the sector as a whole. Despite some setbacks we made strong progress. Of particular note was the filing of our first New Drug Application (NDA) in January 1999 for frovatriptan, followed only weeks later by the MAA regulatory filing. We also added two exciting new compounds to the portfolio in October and December.
In October Simon Cartmell joined from GlaxoWellcome as our Chief Operating Officer. He has responsibility for Vanguard's commercial activities, the evaluation of potential new projects and the further development of the Company's project management and information systems. In December we were delighted to promote Sally Waterman to the position of Vice President, Non-clinical Development and to the Board of Vanguard Medica Limited. We will continue to invest in training and staff development.
We would like to take this opportunity to thank all our staff on your behalf for all their hard work, loyalty and dedication over the last year. Theirs has been a significant contribution in a year of great change. We think it is an outstanding testament to the Vanguard organisation that we have managed to file an NDA in such a short time with a team that numbered only 67 at the end of 1998. In order to do this, we have had to conduct all the functions of a large, fully integrated pharmaceutical company including non-clinical work such as manufacturing and scale-up toxicology, drug metabolism, pharmacokinetics and pharmaceutical development as well as the entire clinical trial process, culminating in the regulatory submissions.
Vanguard Medica Frovatriptan is being marketed by Elan, which is confident that the product will succeed in the crowded migraine market. An Elan spokesman...... added that Vanguard has supplied a " |
1 | 60054676_2 | 60054676 | , the evaluation of potential new projects and the further development of the Company's project management and information systems. In December we were delighted to promote Sally Waterman to the position of Vice President, Non-clinical Development and to the Board of Vanguard Medica Limited. We will continue to invest in training and staff development.
We would like to take this opportunity to thank all our staff on your behalf for all their hard work, loyalty and dedication over the last year. Theirs has been a significant contribution in a year of great change. We think it is an outstanding testament to the Vanguard organisation that we have managed to file an NDA in such a short time with a team that numbered only 67 at the end of 1998. In order to do this, we have had to conduct all the functions of a large, fully integrated pharmaceutical company including non-clinical work such as manufacturing and scale-up toxicology, drug metabolism, pharmacokinetics and pharmaceutical development as well as the entire clinical trial process, culminating in the regulatory submissions.
Vanguard Medica Frovatriptan is being marketed by Elan, which is confident that the product will succeed in the crowded migraine market. An Elan spokesman...... added that Vanguard has supplied a "top-notch clinical package"
referring to the quality of trial data. Frovatriptan is likely to go on sale in the first half of next year.
Source: Investors Chronicle, 12 March 1999
quality
We would like to thank all our suppliers, contractors and partners around the world who continue to work with us on this wide range of demanding and complex activities.
During the second half of 1998, after very careful consideration, we took tough decisions to discontinue development of three compounds in our portfolio. All were dropped following early stage, small-scale and relatively inexpensive Phase IIa clinical studies. A thorough reassessment of the commercial potential and competitive profile of the compounds was made based upon the clinical and other information to hand and the Board concluded that further investment in these compounds was not in the best interests of the Company and its shareholders. The sums of money invested in each of these compounds was between 4% and 7% of Vanguard's cumulative research and development expenditure between 1992 and 1998. In contrast, our investment in our most advanced compound, frovatriptan, for the acute treatment of migraine, represents over 75% of the cumulative spend.
Our achievement in having carried out the complete development programme for frovatript |
1 | 60054676_3 | 60054676 | top-notch clinical package"
referring to the quality of trial data. Frovatriptan is likely to go on sale in the first half of next year.
Source: Investors Chronicle, 12 March 1999
quality
We would like to thank all our suppliers, contractors and partners around the world who continue to work with us on this wide range of demanding and complex activities.
During the second half of 1998, after very careful consideration, we took tough decisions to discontinue development of three compounds in our portfolio. All were dropped following early stage, small-scale and relatively inexpensive Phase IIa clinical studies. A thorough reassessment of the commercial potential and competitive profile of the compounds was made based upon the clinical and other information to hand and the Board concluded that further investment in these compounds was not in the best interests of the Company and its shareholders. The sums of money invested in each of these compounds was between 4% and 7% of Vanguard's cumulative research and development expenditure between 1992 and 1998. In contrast, our investment in our most advanced compound, frovatriptan, for the acute treatment of migraine, represents over 75% of the cumulative spend.
Our achievement in having carried out the complete development programme for frovatriptan should not be underestimated. A December 1998 publication commissioned by the Association of British Pharmaceutical Industry (ABPI) illustrates that the time to develop a compound through the stages we have taken frovatriptan has typically been six years. We will have succeeded in doing this in four and a quarter years without, we believe, making any compromises regarding the quality of data collected. This is a very significant achievement for a young company.
4 l 5 Vanguard Medica Annual Report 1998
We believe that the three new collaborations which the Company has entered into in 1998 demonstrate Vanguard's increasing
credibility with the large healthcare companies.
Robert Mansfield Chief Executive
The same ABPI report quotes average attrition rates for compounds at various stages in the development process. Vanguard typically commences development at the late pre-clinical stage and evaluates the compound during exploratory Phase I and II clinical studies.
Our record to date appears to be similar to the industry norm, albeit based on a small number of compounds. We would, of course, prefer to be better than the norm, but we take the view that, inevitably, some compounds will fail to meet the clinical and competitive profile that we and our partners have defined for them. It will normally take us two to three years |
1 | 60054676_b0 | 60054676 | from the trade name. The system of naming employs a common "stem" for each member of a class of compounds sharing the same mechanism of action. "Triptan" (as in frovatriptan) is the stem adopted for drugs that act on 5HT1 receptors and which share a similar mechanism of action in relieving migraine attacks.
Useful websites http://www.biospace.com general biotech & pharmaceutical site http://www.pslgroup.com/docguide.htm Doctor's guide to the Internet Background to diseases and treatments. http://www.hepnet.com for information on hepatitis and HCV. http://www.mediconsult.com for background and information on many diseases and treatments. http://www.amaassn.org/special/migraine The Journal of the American Medical Association's Migraine Information Centre http://www.aash.org http://scup.no/cephalalgia
Subarachnoid space Space between the arachnoid membrane of the brain and another membrane (pia mater) which is in direct contact with the central nervous system.
Synthesis The preparation of a substance by chemical means as opposed to its extraction from a natural source.
Toxic Causing an undesired or adverse effect. Most substances will cause adverse effects if high enough doses are given.
Vasoconstriction An induced narrowing of blood vessels.
Vasodilation An induced expansion of blood vessels.
Vasospasm Prolonged and profound constriction of blood vessels leading to inadequate blood supply to a tissue or organ.
Designed and produced by Pauffley, Portrait photography: Michael Heffernan, Compound backgrounds: Originals by Tony Stone Images and Science Photo Library, Image manipulation and typesetting by Generator Ltd, Printed by The Beacon Press, using pureprintTM totally water and alcohol free technology. Accredited to ISO14001 and EMAS, Stock: Dutchman. Dutchman is made with totally chlorine free pulp from materials harvested as a renewable resource.
Vanguard Medica Group plc Registered No: 3137449 Registered Office: Chancellor Court, Surrey Research Park Guildford, Surrey GU2 5SF, UK Tel: (44) 1483 787878 Fax: (44) 1483 787811 e-mail: admin@vanguardmedica.com website: www.vanguardmedica.com
|
1 | 60054676_b1 | 60054676 | doses to be used in the Phase III clinical trials.
Phase III Full scale clinical trials to determine efficacy and safety of a drug prior to seeking marketing approval.
Phase IV Large scale clinical trials carried out after regulatory approval designed to expand experience of the efficacy and safety of the drug, often in comparison with other treatments. Sometimes referred to as marketing support trials.
Placebo An inactive substance used as a comparison with an active drug.
Pre-clinical studies Non-clinical studies performed to determine safety, pharmacological activity and product quality.
54 l Vanguard Medica Annual Report 1998
Glossary
continued
Prophylactically Administered to prevent, as opposed to treat, a disease or condition.
Receptor A protein located in a body tissue with which a hormone, neurotransmitter or drug interacts to produce or prevent a biological response.
Renal Pertaining to the kidney.
Stability The study of the integrity of a drug substance or finished product over time under various, well defined and controlled storage conditions.
Toxicology The study of the undesired or adverse effects of a substance on the body.
Triptan All marketed drugs have an internationally approved name for the compound (drug substance), as distinct from the trade name. The system of naming employs a common "stem" for each member of a class of compounds sharing the same mechanism of action. "Triptan" (as in frovatriptan) is the stem adopted for drugs that act on 5HT1 receptors and which share a similar mechanism of action in relieving migraine attacks.
Useful websites http://www.biospace.com general biotech & pharmaceutical site http://www.pslgroup.com/docguide.htm Doctor's guide to the Internet Background to diseases and treatments. http://www.hepnet.com for information on hepatitis and HCV. http://www.mediconsult.com for background and information on many diseases and treatments. http://www.amaassn.org/special/migraine The Journal of the American Medical Association's Migraine Information Centre http://www.aash.org http://scup.no/cephalalgia
Subarachnoid space Space between the arachnoid membrane of the brain and another membrane (pia mater) which is in direct contact with the central nervous system.
Synthesis The preparation of a substance by chemical means as opposed to its extraction |
1 | 60054681_0 | 60054681 | annual report & accounts 1998
Contents
Financial Highlights
1
Operational Highlights
1
Chairman's Statement
2
Operational and Financial Review
4
Production and Reserves
10
Directors
12
Advisers
14
Directors' Report
15
Auditors' Report to the Members of Paladin Resources plc 24
Group Profit and Loss Account
26
Group Statement of Total Recognised Gains and Losses
27
Group Balance Sheet
28
Company Balance Sheet
29 Glossary
Group Cash Flow Statement
30 B = billion (one thousand million)
Notes
31 bbl = barrels of oil
Notice of Annual General Meeting
50 boe = barrels of oil and oil equivalent
boepd = barrels of oil and oil equivalent per day
bopd = barrels of oil per day
btu = British thermal unit
the Combined Code = the Principles of Good Governance and Code of Best Practice published by the London Stock Exchange in July 1998
the Company = Paladin Resources plc (formerly known as Pittencrieff Resources plc)
Enron = Enron Corporation, Inc. and its direct and indirect subsidiaries
FPSO = floating production, storage and offloading facility
the Group = the Company and its direct and indirect subsidiaries
ICAEW = Institute of Chartered Accountants in England and Wales
M = thousand
MM = million
scf = standard cubic feet of gas
scfd = standard cubic feet of gas per day
South East Sumatra PSC = South East Sumatra Production Sharing Contract
$= United States dollars unless otherwise stated
Financial Highlights
for the year ended 31 December 1998
(Loss)/profit before taxation and exceptional items Earnings/(loss) per share:
pre exceptional items post exceptional items Cash flow from operations after administrative expenses Net funds/(debt) at year end
1998 (£1,176,000)
1997
£946,000
(1.04p) (1.04p) £1,403,000 £17,416,000
1.57p (18.51p) £4,301,000 (£10,045,000)
Oper |
1 | 60054681_1 | 60054681 | Pittencrieff Resources plc)
Enron = Enron Corporation, Inc. and its direct and indirect subsidiaries
FPSO = floating production, storage and offloading facility
the Group = the Company and its direct and indirect subsidiaries
ICAEW = Institute of Chartered Accountants in England and Wales
M = thousand
MM = million
scf = standard cubic feet of gas
scfd = standard cubic feet of gas per day
South East Sumatra PSC = South East Sumatra Production Sharing Contract
$= United States dollars unless otherwise stated
Financial Highlights
for the year ended 31 December 1998
(Loss)/profit before taxation and exceptional items Earnings/(loss) per share:
pre exceptional items post exceptional items Cash flow from operations after administrative expenses Net funds/(debt) at year end
1998 (£1,176,000)
1997
£946,000
(1.04p) (1.04p) £1,403,000 £17,416,000
1.57p (18.51p) £4,301,000 (£10,045,000)
Operational Highlights
for the year ended 31 December 1998
Oil Production Annual (Mbbl) Average daily (bbl) Gas Production Annual (MMscf) Average daily (Mscf) Total Production Annual (Mboe) Average daily (boe) Oil and Gas Reserves (Mboe) Proven Probable Total proven plus probable Oil/Gas Mix Oil reserves Gas reserves
1 Paladin Resources plc
1998
866 2,373
2,868 7,858
1,344 3,683
16,930 4,331 21,261
78% 22%
1997
472 1,293
4,466 12,236
1,216 3,332
8,636 4,350 12,986
45% 55%
Chairman's Statement
Dear Shareholder Paladin made significant progress towards achieving its near term objectives in 1998 against the background of a challenging environment for the E & P industry. Following the successful Placing and Open Offer, which raised £40.9 million in July, assets have been acquired in the UK North Sea and offshore South East Sumatra in Indonesia. In the USA, the sale of 50% of the Group's interests in its four |
1 | 60054681_2 | 60054681 | ational Highlights
for the year ended 31 December 1998
Oil Production Annual (Mbbl) Average daily (bbl) Gas Production Annual (MMscf) Average daily (Mscf) Total Production Annual (Mboe) Average daily (boe) Oil and Gas Reserves (Mboe) Proven Probable Total proven plus probable Oil/Gas Mix Oil reserves Gas reserves
1 Paladin Resources plc
1998
866 2,373
2,868 7,858
1,344 3,683
16,930 4,331 21,261
78% 22%
1997
472 1,293
4,466 12,236
1,216 3,332
8,636 4,350 12,986
45% 55%
Chairman's Statement
Dear Shareholder Paladin made significant progress towards achieving its near term objectives in 1998 against the background of a challenging environment for the E & P industry. Following the successful Placing and Open Offer, which raised £40.9 million in July, assets have been acquired in the UK North Sea and offshore South East Sumatra in Indonesia. In the USA, the sale of 50% of the Group's interests in its four main US properties was completed in May, the Group's interests in the Corpus Christi properties were sold in August and the balance of the North American portfolio was further rationalised throughout the year. Paladin's capability to compete effectively for acquisitions in a market which, we believe, continues to offer attractive investment opportunities for well-funded companies was further enhanced in September, when debt facilities were refinanced by a $75 million bilateral corporate unsecured revolving credit facility provided by The Chase Manhattan Bank.
Results The Group achieved a break-even result for the second half of the year, despite lower oil prices, as production benefited from a five month contribution from the South East Sumatra PSC. The retained loss for the year was £1.3 million (1997: loss after exceptional items £10.8 million; profit before exceptional items £0.9 million). The loss per share was 1.04p (1997: loss after exceptional items 18.51p; profit before exceptional items 1.57p).
Production and Development Net production for the year amounted to 866,000 barrels of oil and 2.87 billion cubic feet of gas, an average of 3,683 boepd. This compares with an average of 3,332 boepd for 1997. |
1 | 60054681_3 | 60054681 | main US properties was completed in May, the Group's interests in the Corpus Christi properties were sold in August and the balance of the North American portfolio was further rationalised throughout the year. Paladin's capability to compete effectively for acquisitions in a market which, we believe, continues to offer attractive investment opportunities for well-funded companies was further enhanced in September, when debt facilities were refinanced by a $75 million bilateral corporate unsecured revolving credit facility provided by The Chase Manhattan Bank.
Results The Group achieved a break-even result for the second half of the year, despite lower oil prices, as production benefited from a five month contribution from the South East Sumatra PSC. The retained loss for the year was £1.3 million (1997: loss after exceptional items £10.8 million; profit before exceptional items £0.9 million). The loss per share was 1.04p (1997: loss after exceptional items 18.51p; profit before exceptional items 1.57p).
Production and Development Net production for the year amounted to 866,000 barrels of oil and 2.87 billion cubic feet of gas, an average of 3,683 boepd. This compares with an average of 3,332 boepd for 1997. The production
mix has changed significantly, with a substantially lower contribution from the USA (due to divestments and natural decline) being more than offset by production from the South East Sumatra PSC. Oil represented 64% of production during the year (1997: 39%). Geographically, 56% of production came from North America and 44% from Indonesia (1997: 100% North America).
The Bittern project is progressing within budget and is benefiting, in particular, from substantially lower drilling costs than would have been anticipated 12 months ago - the direct result of continuing low oil prices and reduced industry activity. We anticipate first oil production during the fourth quarter 1999. The rate of development and infill drilling activity within the South East Sumatra PSC continues to be unaffected by the low oil price environment and gross production has been maintained at rates well in excess of 140,000 bopd.
Overall, the Group invested a total of £5.2 million on production and development projects 39% on the Bittern project, 35% on the South East Sumatra PSC and 26% in North America.
Reserves As detailed below, the proven and probable reserves at 31 December 1998 have increased by 64% to 21.3 MMboe compared to 13 |
1 | 60054681_b0 | 60054681 | Director for any cause but without prejudice to any claim for damages for breach of contract of service between the Director and the Company";
(b) by the deletion of the words "(other than a Director exempt from retirement by rotation under any other provision of these Articles)" in Article 102 (1).
By order of the Board
S C Powell Company Secretary
Registered Office: 50 Lothian Road Festival Square Edinburgh EH3 9BY 30 March 1999
51
Paladin Resources plc
Notice of Annual General Meeting
Notes: 1. Any member may appoint another person or persons (whether members of the Company or not) as his proxy or proxies to
attend and vote in his stead. Proxies must be lodged at the office of the Company's Registrars, Lloyds TSB Registrars Scotland, Apex House, 9 Haddington Place, Edinburgh EH7 0LA not less than 48 hours before the time appointed for holding the meeting. 2. The Register of Directors' Share Interests required under Section 325 of the Companies Act 1985 is available for inspection at 50 Lothian Road, Festival Square, Edinburgh during normal working hours from the date of this Notice to 14 May 1999 inclusive and during the Annual General Meeting. 3. To be entitled to attend and vote at the meeting (and for the purpose of the determination by the Company of the number of votes they may cast), members must be entered in the Register of Members at 2.00 p.m. on 12 May 1999 ("the specified time"). If the meeting is adjourned to a time not more than 48 hours after the specified time applicable to the original meeting, that time will also apply for the purpose of determining the entitlement of members to attend and vote (and for the purposes of determining the number of votes they may cast) at the adjourned meeting. If however the meeting is adjourned for a longer period then, to be so entitled, members must be entered on the Company's Register of Members at the time which is not less than 48 hours before the time fixed for the adjourned meeting or, if the Company gives notice of the adjourned meeting, at the time specified in that notice.
52 Paladin Resources plc
Head Office: Princes House 38 Jermyn Street London SW1Y 6DN Tel 0171-534 2900 Fax 0171-534 2901
Registered Office: Burness 50 Lothian Road Festival Square Edinburgh EH3 9BY
|
1 | 60054681_b1 | 60054681 | authorised to purchase for cancellation its own ordinary shares by way of market purchase, provided that:-
(a) the maximum number of ordinary shares hereby authorised to be acquired is 20,069,438 (representing 10% of the issued ordinary share capital as at 31 December 1998);
(b) the maximum price which may be paid for such shares is 105% of the average of the middle market quotations derived from The Daily Official List of The London Stock Exchange for the five business days preceding the date of purchase and the minimum price is 10p per share being the nominal value thereof, in both cases exclusive of expenses; and
(c) the authority hereby conferred shall expire on the date of the next Annual General Meeting of the Company.
9. That the Articles of Association be amended as follows:-
(a) by the deletion of the existing Article 89 and the adoption of the undernoted as a new Article 89:
"A Managing Director or Chief Executive Officer shall be subject to the same provisions as to retirement by rotation and removal as the other Directors of the Company, and he shall (subject to the provisions of any contract between him and the Company) ipso facto cease to be Managing Director or Chief Executive Officer if he ceases to hold office as Director for any cause but without prejudice to any claim for damages for breach of contract of service between the Director and the Company";
(b) by the deletion of the words "(other than a Director exempt from retirement by rotation under any other provision of these Articles)" in Article 102 (1).
By order of the Board
S C Powell Company Secretary
Registered Office: 50 Lothian Road Festival Square Edinburgh EH3 9BY 30 March 1999
51
Paladin Resources plc
Notice of Annual General Meeting
Notes: 1. Any member may appoint another person or persons (whether members of the Company or not) as his proxy or proxies to
attend and vote in his stead. Proxies must be lodged at the office of the Company's Registrars, Lloyds TSB Registrars Scotland, Apex House, 9 Haddington Place, Edinburgh EH7 0LA not less than 48 hours before the time appointed for holding the meeting. 2. The Register of Directors' Share Interests required under Section 325 of the Companies Act 1985 is available for inspection at 50 Lothian Road, Festival Square, Edinburgh during normal working hours from the date of this Notice to 14 May 1999 inclusive and during the Annual General Meeting. |
1 | 60054786_0 | 60054786 | Annual Report 1998
ANNUAL GENERAL MEETING OF SHAREHOLDERS
The Annual General Meeting will be held at the Berns Congress, Berzelli Park in Stockholm on Friday, 16 April 1999, at 3 p.m.
Shareholders who are registered in the share register print-out on 6 April 1999 and who give notice of intention to participate in the Meeting no later than 12 noon, Monday, 12 April 1999 are entitled to participate in the Annual General Meeting.
financial information H & M Hennes & Mauritz AB will provide the following information for the 1999 financial year:
i n t e r i m r e p o r t, three months 16 April 1999
i n t e r i m r e p o r t, six months 22 June 1999
nominee shares
i n t e r i m r e p o r t, nine months
Shareholders whose shares are registered in
21 September 1999
the name of a nominee must re-register their shares in their own names to be entitled to participate in the Meeting. In order to re-regis-
p r e s s r e l e a s e, annual earnings January 2000
ter shares for participation in the Meeting in a n n ua l r e p o r t
good time before 6 April 1999 shareholders
March 2000
should request temporary owner registration,
which is referred to as voting right registration. This information will also be available at
www.hm.com
notice
Notice of intention to participate in the Meet-
ing must be submitted by mail, telefax or tele-
phone to:
h & m hennes & mauritz ab box 1421
CONTENTS
111 84 stockholm, sweden
Telephone +46 8 796 55 00 Telefax +46 8 24 80 78
Shareholders wishing to participate in the Meeting must register their intention no later than 12 noon, Monday, 12 April 1999.
dividend The Board of Directors have proposed Wednesday, 21 April 1999 as record day. VPC (Swedish Securities Register Centre) is expected to commence paying dividends on 28 April 1999.
The Board of Directors and the Managing Director have decided to propose to the Annual General Meeting a dividend for 1998 of SEK 4 per share.
split The Board of Directors have decided to propose to the Annual |
1 | 60054786_1 | 60054786 | 2000
ter shares for participation in the Meeting in a n n ua l r e p o r t
good time before 6 April 1999 shareholders
March 2000
should request temporary owner registration,
which is referred to as voting right registration. This information will also be available at
www.hm.com
notice
Notice of intention to participate in the Meet-
ing must be submitted by mail, telefax or tele-
phone to:
h & m hennes & mauritz ab box 1421
CONTENTS
111 84 stockholm, sweden
Telephone +46 8 796 55 00 Telefax +46 8 24 80 78
Shareholders wishing to participate in the Meeting must register their intention no later than 12 noon, Monday, 12 April 1999.
dividend The Board of Directors have proposed Wednesday, 21 April 1999 as record day. VPC (Swedish Securities Register Centre) is expected to commence paying dividends on 28 April 1999.
The Board of Directors and the Managing Director have decided to propose to the Annual General Meeting a dividend for 1998 of SEK 4 per share.
split The Board of Directors have decided to propose to the Annual General Meeting a 4:1 split of company shares with 19 May as record day. Assuming that the Meeting approves the proposal, H&M shares will be listed on the Stockholm Stock Exchange as split commencing 17 May 1999.
Financial highlights
1
Report of the Managing Director
2
Group Review
4
From idea to finished garment
12
Environment
15
Administration Report
16
Group income statement
17
Group balance sheet
18
Consolidated cash flow statement 20
Parent Company income statement 21
Parent company balance sheet
22
Parent company cash flow statement 24
Notes to the financial statements
25
Proposed distribution of earnings 28
Auditors' report
29
Five-year summary
30
H&M share
31
Board of directors
32
H&M facts
34
Addresses
37
THE YEAR IN REVIEW
the h&m Group continued to expand during the financial year. a total of 71 stores were opened.
during the year, two new markets were added; france with six |
1 | 60054786_2 | 60054786 | General Meeting a 4:1 split of company shares with 19 May as record day. Assuming that the Meeting approves the proposal, H&M shares will be listed on the Stockholm Stock Exchange as split commencing 17 May 1999.
Financial highlights
1
Report of the Managing Director
2
Group Review
4
From idea to finished garment
12
Environment
15
Administration Report
16
Group income statement
17
Group balance sheet
18
Consolidated cash flow statement 20
Parent Company income statement 21
Parent company balance sheet
22
Parent company cash flow statement 24
Notes to the financial statements
25
Proposed distribution of earnings 28
Auditors' report
29
Five-year summary
30
H&M share
31
Board of directors
32
H&M facts
34
Addresses
37
THE YEAR IN REVIEW
the h&m Group continued to expand during the financial year. a total of 71 stores were opened.
during the year, two new markets were added; france with six stores and denmark with a mail-order operation.
sales in comparable stores and market shares rose in all markets.
sales rose by 25 per cent and totalled sek 26,650 m.
income before tax grew by 37 per cent to sek 3,327.
FINANCIAL HIGHLIGHTS
1998 1997
Gross sales, including vat Change Sales outside Sweden Sales outside Sweden as a percentage of gross sales Operating margin Profit after financial items Net profit for the year Earnings per share Change from previous year Return on shareholders' equity, note 17 Return on capital employed, note 17 Debt/equity ratio, note 17 Share of risk-bearing capital, note 17 Solidity, note 17 Number of stores in Sweden Number of stores outside Sweden Total number of stores Average number of employees
sek m %
sek m % %
sek m sek m
sek % % % % % %
26,649.8 + 25
21,730.1 82
14.8 3,468.2 2,286.9
11.05 + 35
30.7 46.3
1.1 7 7. 9 73.4 120 430 550 14, |
1 | 60054786_3 | 60054786 | stores and denmark with a mail-order operation.
sales in comparable stores and market shares rose in all markets.
sales rose by 25 per cent and totalled sek 26,650 m.
income before tax grew by 37 per cent to sek 3,327.
FINANCIAL HIGHLIGHTS
1998 1997
Gross sales, including vat Change Sales outside Sweden Sales outside Sweden as a percentage of gross sales Operating margin Profit after financial items Net profit for the year Earnings per share Change from previous year Return on shareholders' equity, note 17 Return on capital employed, note 17 Debt/equity ratio, note 17 Share of risk-bearing capital, note 17 Solidity, note 17 Number of stores in Sweden Number of stores outside Sweden Total number of stores Average number of employees
sek m %
sek m % %
sek m sek m
sek % % % % % %
26,649.8 + 25
21,730.1 82
14.8 3,468.2 2,286.9
11.05 + 35
30.7 46.3
1.1 7 7. 9 73.4 120 430 550 14,101
21,279.4 + 24
16,853.1 79
13.5 2,511.9 1,690.9
8.17 + 27
29.1 42.5
2.1 7 7. 4 72.4 117 373 490 12,096
1998 h&m a n n ua l r e p o r t 1
REPORT OF THE MANAGING DIRECTOR
n i n e t e e n ninetyeight was a successful year for the H&M Group. We reported our best earnings ever, as total turnover rose by 25 per cent to SEK 26.6 billion. Profit before tax increased by 37 per cent to SEK 3.3 billion. Both sales in comparable stores and market shares increased on all markets. Sales outside Sweden accounted for 82 per cent of Group turnover. Germany, H&M's single largest market, generated 32 per cent of the Group's total turnover. We continued to expand in 1998. The number of stores increased by 60, bringing the total number of H&M stores at year-end to 550 in 12 European countries. We began operating in France, opening six stores during the year. Our first store opened in r |
1 | 60054786_b0 | 60054786 | m a n n ua l r e p o r t 3 5
3 6 h&m a n n ua l r e p o r t 1998
ADDRESSES
H & M Hennes & Mauritz AB Norrlandsgatan 15 Box 1421 SE-111 84 Stockholm Tel: +46 8 796 55 00 www.hm.com
H & M Rowells AB Hultagatan 47 SE-501 89 Borås Tel: +46 33 16 97 00
H & M Hennes & Mauritz A/S Strömsveien 195/197 PB 68 Alnabru NO-0614 Oslo Tel: +47 22 17 13 90
H & M Hennes & Mauritz A/S (mail-order) Postboks 104 NO-2020 Skedsmokorset Tel: +47 63 87 00 40
H & M Hennes & Mauritz A/S Amagertorv 21, 4. sal DK-1160 Copenhagen K Tel: +45 33 14 06 77
H & M Hennes Ltd Middlesex House 34/46 Cleveland Street GB-London W1P 5FB Tel: +44 171 323 22 11
H & M Hennes & Mauritz SA Place de la Fusterie 9 CH-1204 Geneva Tel: +41 22 311 12 13
H & M Hennes & Mauritz GmbH Große Bleichen 30 DE-20354 Hamburg Tel: +49 40 350 95 50
H & M Hennes & Mauritz Netherlands B.V. Kalverstraat 112-2 P.O.Box 10506 NL-1001 EM Amsterdam Tel: +31 20 556 7777
H & M Hennes & Mauritz Belgium B.V. Rue St. Michel, 28 BE-1000 Brussels Tel: +32 2 219 98 70
H & M Hennes & Mauritz GesmbH Mariahilferstraße 53 AT-1060 Vienna Tel: +43 1 585 84 000
H & M Hennes & Mauritz Oy Alexanderinkatu 42B PB 389 FI-00101 Helsinki Tel: +358 9 34 34 950
H & M Hennes & Mauritz sarl 118, Rue de Rivoli FR-75001 Paris Tel: +33 1 55 34 38 00
Production: Konsultkompaniet Sundén AB. Print: Arne Löfgren Offset. Stockholm 1999
|
1 | 60054786_b1 | 60054786 | 1978 2,193
42 20 1,001
1980 8,511
149 77
3,898
The Netherlands Established: Turnover (SEK M): Number of stores: Number of locations: Number of employees:
Belgium Established: Turnover (SEK M): Number of stores: Number of locations: Number of employees:
Austria Established: Turnover (SEK M): Number of stores: Number of locations: Number of employees:
Luxembourg Established: Turnover (SEK M): Number of stores: Number of locations: Number of employees:
Finland Established: Turnover (SEK M) Number of stores: Number of locations: Number of employees:
France Established: Turnover (SEK M): Number of stores: Number of locations: Number of employees:
1989 1,723
44 28 1,136
1992 1,237
30 20 477
1994 2,416
31 9
1,302
1996 69 3 1 37
1997 577 8 5 251
1998 282 6 2 252
3 4 h&m a n n ua l r e p o r t 1998
1998 h&m a n n ua l r e p o r t 3 5
3 6 h&m a n n ua l r e p o r t 1998
ADDRESSES
H & M Hennes & Mauritz AB Norrlandsgatan 15 Box 1421 SE-111 84 Stockholm Tel: +46 8 796 55 00 www.hm.com
H & M Rowells AB Hultagatan 47 SE-501 89 Borås Tel: +46 33 16 97 00
H & M Hennes & Mauritz A/S Strömsveien 195/197 PB 68 Alnabru NO-0614 Oslo Tel: +47 22 17 13 90
H & M Hennes & Mauritz A/S (mail-order) Postboks 104 NO-2020 Skedsmokorset Tel: +47 63 87 00 40
H & M Hennes & Mauritz A/S Amagertorv 21, 4. sal DK-1160 Copenhagen K Tel: +45 33 14 06 77
H & M Hennes Ltd Middlesex House 34/46 Cleveland Street GB-London W1P 5FB Tel: +44 171 323 22 11
H & M Hennes |
1 | 60054795_0 | 60054795 | Annual Report & Accounts 1998
Contents
1 Strategy Statement 2 At a Glance 5 Highlight Myanmar 6 Highlight Pakistan 8 Chairman's Statement 10 Chief Executive's Review 12 Activity Overview 14 Statement of Principles 16 Operational Review 23 Licence Interests 24 Financial Review 28 Board of Directors 29 Corporate Governance 31 Report of the Directors 33 Remuneration Report
37 Statement of Directors' Responsibilities, Auditors' Report
38 Accounting Policies 39 Consolidated Profit and Loss Account,
Consolidated Statement of Total Recognised Gains and Losses, Group Reconciliation of Movements in Shareholders' Funds 40 Balance Sheets 41 Consolidated Cash Flow Statement 42 Notes to the Accounts 55 Reserves 56 Five Year Summary, Shareholder Information
Inside Front Contents, Business Statement Inside Back Glossary, Company Information
Business Statement
Premier is an international exploration, production and development company with oil and gas interests in over six countries.
The Company is focused on delivering exceptional value for all stakeholders through its Asia gas strategy of commercialising gas reserves and the development of low-cost oil reserves in the Middle East. Premier's four core business areas are the UK, Pakistan, Indonesia and Myanmar.
Cover photography: Close-up of drill bit
"Our objective is to be a leading worldwide energy company specialising in exploration, development and production of gas and oil. We have a clear strategy, the people, the technology and a desire to add value to our global network of activities."
David John Chairman
1
Report & Accounts 1998
"Our achievements over the past three years including the transformation of the Company into a significant production and development operator have forged an experienced and creative team of people dedicated to `Making a Difference'."
Charles Jamieson Chief Executive
469.9 226.3 194.5
35,500 43,900
32,000
104.6 166.2
138.8
Report & Accounts 1998
At a Glance
Turnover £m
Production boepd
Reserves mmboe
2
96
97
98
96
97
98
96
97
98
3
Report & Accounts 1998
4
Report & Accounts 1998
"The Yetagun development, Myanmar, continues the rapid transition of Premier from an exploration company to an international production and development operator."
Mervyn Porter General |
1 | 60054795_1 | 60054795 |
"Our objective is to be a leading worldwide energy company specialising in exploration, development and production of gas and oil. We have a clear strategy, the people, the technology and a desire to add value to our global network of activities."
David John Chairman
1
Report & Accounts 1998
"Our achievements over the past three years including the transformation of the Company into a significant production and development operator have forged an experienced and creative team of people dedicated to `Making a Difference'."
Charles Jamieson Chief Executive
469.9 226.3 194.5
35,500 43,900
32,000
104.6 166.2
138.8
Report & Accounts 1998
At a Glance
Turnover £m
Production boepd
Reserves mmboe
2
96
97
98
96
97
98
96
97
98
3
Report & Accounts 1998
4
Report & Accounts 1998
"The Yetagun development, Myanmar, continues the rapid transition of Premier from an exploration company to an international production and development operator."
Mervyn Porter General Manager, Myanmar
5
Report & Accounts 1998
"New exploration discoveries at Zamzama and Zarghun South, continued production from the Qadirpur and Kadanwari gas fields combined with finalisation of the joint venture alliance with Shell, have helped make Premier the most successful foreign oil company operating within Pakistan."
Max Birley General Manager, Pakistan
6
Report & Accounts 1998
7
Report & Accounts 1998
Chairman's Statement
"To create exceptional value for shareholders over the long-term we must maximise the value we add to both assets and opportunities. Our operational achievements in 1998 have done precisely that and will greatly enhance our long-term revenues and cash flow."
My first year as Chairman has coincided with an
As foreshadowed in the interim results, we have applied
extremely challenging one for the industry, with oil
the new Financial Reporting Standard No. 11 (FRS 11),
prices at 25-year lows and a severe downturn in Asian
relating to the calculation of impairment of fixed assets,
economies. Despite the disappointing impact of these
for the first time. The requirement to segment assets
factors |
1 | 60054795_2 | 60054795 | Manager, Myanmar
5
Report & Accounts 1998
"New exploration discoveries at Zamzama and Zarghun South, continued production from the Qadirpur and Kadanwari gas fields combined with finalisation of the joint venture alliance with Shell, have helped make Premier the most successful foreign oil company operating within Pakistan."
Max Birley General Manager, Pakistan
6
Report & Accounts 1998
7
Report & Accounts 1998
Chairman's Statement
"To create exceptional value for shareholders over the long-term we must maximise the value we add to both assets and opportunities. Our operational achievements in 1998 have done precisely that and will greatly enhance our long-term revenues and cash flow."
My first year as Chairman has coincided with an
As foreshadowed in the interim results, we have applied
extremely challenging one for the industry, with oil
the new Financial Reporting Standard No. 11 (FRS 11),
prices at 25-year lows and a severe downturn in Asian
relating to the calculation of impairment of fixed assets,
economies. Despite the disappointing impact of these
for the first time. The requirement to segment assets
factors on our 1998 financial results and share price
geographically has resulted in additional charges to
performance, the Company has delivered major
profits of £143.3 million, relating mainly to past UK
operational success:
expenditure. This additional charge has no impact on the
· We doubled our oil and gas reserves to 470 mmboe. · Our finding costs were £0.24 per boe.
Group's cash flow and will not be included by our lenders for the purposes of calculating debt to equity ratios for covenant purposes. The effect is to reduce profits after
· We had significant exploration and appraisal successes tax from £6.1 million to a loss of £137.2 million,
in Pakistan, Myanmar and Indonesia.
compared with a 1997 profit of £48.5 million. Further
· We signed an agreement with Shell to combine our
details are included in the Financial Review.
exploration and production assets in Pakistan.
· We completed the West Natuna Gas Sales Agreement for sales of 2.5 trillion cubic feet of gas from Indonesia to Singapore.
Cash flow before capital expenditure was down by £57.6 million to £32. |
1 | 60054795_3 | 60054795 | on our 1998 financial results and share price
geographically has resulted in additional charges to
performance, the Company has delivered major
profits of £143.3 million, relating mainly to past UK
operational success:
expenditure. This additional charge has no impact on the
· We doubled our oil and gas reserves to 470 mmboe. · Our finding costs were £0.24 per boe.
Group's cash flow and will not be included by our lenders for the purposes of calculating debt to equity ratios for covenant purposes. The effect is to reduce profits after
· We had significant exploration and appraisal successes tax from £6.1 million to a loss of £137.2 million,
in Pakistan, Myanmar and Indonesia.
compared with a 1997 profit of £48.5 million. Further
· We signed an agreement with Shell to combine our
details are included in the Financial Review.
exploration and production assets in Pakistan.
· We completed the West Natuna Gas Sales Agreement for sales of 2.5 trillion cubic feet of gas from Indonesia to Singapore.
Cash flow before capital expenditure was down by £57.6 million to £32.9 million, also because of lower production and oil prices. Net debt at year end amounted to £289 million. Premier is in compliance with
· We completed the US$158 million financing on Yetagun. its financial covenants. The completion of project
financing for Yetagun, together with further amounts
Results After a record year in 1997, the combined effects relating to Pakistan and Myanmar, will result in cash
of lower production and the fall in the oil price reduced
receipts of £83 million in 1999.
turnover by 37% to £104.6 million.
Premier is in the middle of the largest investment
Profits before the impact of new accounting standards
programme it has so far undertaken, principally to deliver
were also affected at £15.1 million before tax (1997 £71.1 its valuable long-term gas assets into production.
8
million) and £6.1 million post tax (1997 £48.5 million).
Participation in large investment programmes in our core
Report & Accounts 1998
David John Chairman
areas in Myanmar, Indonesia and Pakistan reflects our considerable success in adding |
1 | 60054795_b0 | 60054795 |
Premier Petroleum Myanmar Ltd #16 Shwetaung Kyar Bahan 11201 Yangon Union of Myanmar Tel: 00 951 526 411 Fax: 00 951 525 698
Premier Exploration Pakistan 4th Floor Jang Building Jinnah Avenue, Blue Area Islamabad, Pakistan Tel: 00 9251 823 814 Fax: 00 9251 821 785 Telex 54537
Premier Oil Pacific Ltd 391A Orchard Road #24-01 Ngee Ann City Singapore 238 873 Tel: 00 657 326 644 Fax: 00 657 338 290 Telex: 550176
Auditors Ernst & Young Becket House 1 Lambeth Palace Road London SE1 7EU
Bankers Barclays Bank plc Belgravia Branch 155 Brompton Road London SW3 1XD
Chase Manhattan Bank 125 London Wall London EC2Y 5AJ
J Henry Schroder Wagg & Co Limited 120 Cheapside London EC2V 5AJ
Solicitors Slaughter and May 35 Basinghall Street London EC2V 5DB
Stockbrokers SG Securities (London) Ltd Exchange House Primrose Street Broadgate London EC2A 2DD
Registrars Computershare Services plc Registrar's Department PO Box 435 Owen House 8 Bankhead Crossway North Edinburgh EH11 4BR
Glossary
bcf boe boepd
bopd bpd DTI
IFC
LIBOR
mboepd
mmbbls mmboe
mmscfd
NGLs NGOs
tcf
billion cubic feet barrels oil equivalent barrels oil equivalent per day barrels oil per day barrels per day Department of Trade and Industry International Finance Corporation London Inter Bank Offer Rate thousand barrels oil equivalent per day million barrels million barrels of oil equivalent million standard cubic feet per day Natural Gas Liquids Non-Government Organisations trillion cubic feet
This document is printed on paper manufactured from 100% Totally Chlorine Free (TCF) wood pulp, from sustainable plantantion forests, thinnings and waste from the timber industry. It contains no pulp from rainforest sources and is totally recyclable and biodegradable.
Premier Oil plc 23 Lower Belgrave Street London SW1W 0NR
Telephone +44 (171) 730 1111 Fax +44 (171) 730 4696
www.Premier-Oil.com
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1 | 60054795_b1 | 60054795 |
September 1999 February 2000
%
2.70 2.61 7.57 2.89 6.42 77.81 100.00
Report & Accounts 1998
Designed by Saatchi & Saatchi Design Location photography by Mike Abrahams Board photography by Mike Goldwater Printed by Hyway Pennington
Addresses
Registered Office Premier Oil plc Registered No 17829 Scotland 4th Floor Saltire Court 20 Castle Terrace Edinburgh EH1 2EH
Head Office 23 Lower Belgrave Street London SW1W 0NR Tel: 00 44 171 730 1111 Fax: 00 44 171 730 4696 Telex: 918121
Premier Oil Albania Villa No 21 Ruga `Tre Vellezerit Kondi' Tirana, Albania Tel: 00 355 422 6909 Tel: 00 355 422 8329
Premier Oil Australasia 3rd Floor 31 Ventnor Avenue West Perth, WA Australia 6005 Tel: 00 6189 480 4100 Fax: 00 6189 324 1212
Premier Oil Indonesia Plaza City View 4th Floor Jln. Kemang Timur No 22 Jakarta 12560, Indonesia Tel: 00 6221 718 2001 Fax: 00 6221 718 2010
Premier Petroleum Myanmar Ltd #16 Shwetaung Kyar Bahan 11201 Yangon Union of Myanmar Tel: 00 951 526 411 Fax: 00 951 525 698
Premier Exploration Pakistan 4th Floor Jang Building Jinnah Avenue, Blue Area Islamabad, Pakistan Tel: 00 9251 823 814 Fax: 00 9251 821 785 Telex 54537
Premier Oil Pacific Ltd 391A Orchard Road #24-01 Ngee Ann City Singapore 238 873 Tel: 00 657 326 644 Fax: 00 657 338 290 Telex: 550176
Auditors Ernst & Young Becket House 1 Lambeth Palace Road London SE1 7EU
Bankers Barclays Bank plc Belgravia Branch 155 Brompton Road London SW3 1XD
Chase Manhattan Bank 125 London Wall London EC2Y 5AJ
J Henry Schroder Wagg & Co Limited 120 Cheapside London EC2V 5AJ
Solicitors Slaughter and May 35 Basinghall Street London EC2V 5DB
Stockbrokers SG Securities (London) Ltd Exchange House Primrose Street Broadgate London EC2A 2DD
Registrars Computers |
1 | 60054892_0 | 60054892 | GUINNESS PEAT GROUP PLC
ANNUAL REPORT 1998
Guinness Peat Group plc
Contents
2 Chairman's Statement 4 Financial Profile of Operations 5 Summary of Principal Investments 6 Board of Directors 7 Financial Statements 47 Notice of Annual General Meeting
1
Guinness Peat Group plc
Chairman's Statement
The 31 December net profit of £20 million
was more subdued than had been earlier hoped but, taken in conjunction with other matters referred to in this report, represents a very satisfactory and rewarding result for GPG.
The recommended takeover offer for Tyndall Australia Ltd by the Royal & Sun Alliance Insurance Group plc will, if successful, produce a substantial cash and value increment for GPG, which intends to accept in the absence of any higher offer.
GPG holds 127 million Tyndall shares with a book value of £40 million so there is an expected surplus of approximately £90 million
a powerful new Australasian force in the funds management industry. Unfortunately, this became unlikely to occur in the foreseeable future when our vision was not reciprocated by the unresponsive Board and management of Tower (which is now likely to struggle to survive in a fully competitive market environment). A sadly wasted opportunity for investors in both companies.
The Royal & Sun Alliance proposal was otherwise considered to be the best means to crystallise the considerable added value which Tyndall has accumulated over the past 7 years. (When GPG purchased its first shares in 1990, Tyndall was capitalised at a mere A$15 million compared with A$720 million today).
When GPG purchased its first shares in 1990, Tyndall was capitalised at a mere A$15 million compared with A$720 million today.
to come to account in the current term (although essentially a product of planning and decisions in 1998 and earlier years).
Tyndall has always been active in pursuing expansion by acquisition or merger or, if necessary, absorption by a larger organisation. By far the preferred course, until recently, was a merger with Tower Corporation to create
Another important aspect of the Royal & Sun Alliance offer is that the merger of its existing Australian and New Zealand operations with those of Tyndall provides a financial and structural harmony which will be reassuring to management and clients and enables GPG to vacate its proprietorial role with a strong sense of goodwill and achievement.
2
Guinness Peat Group plc
Other significant factors in GPG |
1 | 60054892_1 | 60054892 | in both companies.
The Royal & Sun Alliance proposal was otherwise considered to be the best means to crystallise the considerable added value which Tyndall has accumulated over the past 7 years. (When GPG purchased its first shares in 1990, Tyndall was capitalised at a mere A$15 million compared with A$720 million today).
When GPG purchased its first shares in 1990, Tyndall was capitalised at a mere A$15 million compared with A$720 million today.
to come to account in the current term (although essentially a product of planning and decisions in 1998 and earlier years).
Tyndall has always been active in pursuing expansion by acquisition or merger or, if necessary, absorption by a larger organisation. By far the preferred course, until recently, was a merger with Tower Corporation to create
Another important aspect of the Royal & Sun Alliance offer is that the merger of its existing Australian and New Zealand operations with those of Tyndall provides a financial and structural harmony which will be reassuring to management and clients and enables GPG to vacate its proprietorial role with a strong sense of goodwill and achievement.
2
Guinness Peat Group plc
Other significant factors in GPG's 1998 result are the previously reported sales of shares in Bluebird Toys, Allgas Energy and PICO Holdings. There were also smaller but useful gains from Ibstock, Iceland Foods, Waterfall Holdings and Adsteam Marine.
Adverse influences include exchange rate movements which, once again, reduced the reported pounds sterling profit (but not the Australian or New Zealand dollar conversions) and, in particular, a major writedown in the value of our 16% interest in Staveley Industries plc. Staveley originally appeared to have (and still has) many of the attributes of an undervalued share price and good asset backing. However, we seriously underestimated its capacity for an apparent relentless destruction of shareholder value (regrettably reminiscent of a certain recent New Zealand experience). We are continuing to closely monitor this investment with a view to more active involvement in the future, if necessary.
Apart from Staveley's specific deficiencies, it is in a category of second and third tier smaller companies whose shares have been hit hard in favour of higher profile industries such as communications and technology. To this extent, our relative inactivity in the market in favour of high levels of liquidity was arguably a correct judgment in the latter part of 1998.
Further appreciation in the market value |
1 | 60054892_2 | 60054892 | 's 1998 result are the previously reported sales of shares in Bluebird Toys, Allgas Energy and PICO Holdings. There were also smaller but useful gains from Ibstock, Iceland Foods, Waterfall Holdings and Adsteam Marine.
Adverse influences include exchange rate movements which, once again, reduced the reported pounds sterling profit (but not the Australian or New Zealand dollar conversions) and, in particular, a major writedown in the value of our 16% interest in Staveley Industries plc. Staveley originally appeared to have (and still has) many of the attributes of an undervalued share price and good asset backing. However, we seriously underestimated its capacity for an apparent relentless destruction of shareholder value (regrettably reminiscent of a certain recent New Zealand experience). We are continuing to closely monitor this investment with a view to more active involvement in the future, if necessary.
Apart from Staveley's specific deficiencies, it is in a category of second and third tier smaller companies whose shares have been hit hard in favour of higher profile industries such as communications and technology. To this extent, our relative inactivity in the market in favour of high levels of liquidity was arguably a correct judgment in the latter part of 1998.
Further appreciation in the market value of Coles-Myer shares has justified the decision to retain the 23% holding in Premier Investments Ltd, our largest Australian portfolio holding.
Capital
There is clearly no requirement for a cash issue this year but the usual 1 for 10 bonus issue will be made together with a cash dividend of 6% (0.6p per share) and a scrip alternative in the ratio of 1 for 85.
SHAREHOLDERS' FUNDS (£ million)
167,052 140,052 133,470
103,266 87,536 66,556
180 150 120 90 60
30
0 93 94 95 96 97 98
The published figures for 1997/1996 and for 1995 have been adjusted for changes in accounting policy made in 1998 and 1996 respectively.
Since last year, there have been tax changes in relation to dividends. Shareholders, particularly those resident in UK or Australia, should consult their advisers.
Outlook
The anticipated sale of Tyndall shares in the current term will require consideration as to the future direction of GPG. The main issue will be whether GPG reinvests on a somewhat larger scale or whether it is now timely to return funds to shareholders or a combination of both.
This |
1 | 60054892_3 | 60054892 | of Coles-Myer shares has justified the decision to retain the 23% holding in Premier Investments Ltd, our largest Australian portfolio holding.
Capital
There is clearly no requirement for a cash issue this year but the usual 1 for 10 bonus issue will be made together with a cash dividend of 6% (0.6p per share) and a scrip alternative in the ratio of 1 for 85.
SHAREHOLDERS' FUNDS (£ million)
167,052 140,052 133,470
103,266 87,536 66,556
180 150 120 90 60
30
0 93 94 95 96 97 98
The published figures for 1997/1996 and for 1995 have been adjusted for changes in accounting policy made in 1998 and 1996 respectively.
Since last year, there have been tax changes in relation to dividends. Shareholders, particularly those resident in UK or Australia, should consult their advisers.
Outlook
The anticipated sale of Tyndall shares in the current term will require consideration as to the future direction of GPG. The main issue will be whether GPG reinvests on a somewhat larger scale or whether it is now timely to return funds to shareholders or a combination of both.
This decision is still some months away and will be made in the light of circumstances prevailing at that time.
Ron Brierley CHAIRMAN
4 March 1999
3
Guinness Peat Group plc
Financial Profile of Operations
Subsidiaries
Australia
Tyndall Australia Ltd Life assurance and funds management
GPG Holding 31 December 1998
50.10%
Consolidated Figures
Year ended 31 December 1998
At 31 December 1998
Net profit before Minority
Interests £000
Turnover £000
Total Assets £000
Shareholders` Funds £000
12,274
147,657
457,281
80,001
Canberra Investment Corp Ltd Property developer
68.47%
20
6,199
10,919
4,880
Mid-East Minerals Ltd Investment company
88.24%
3,363
11,528
11,451
Associates
New Zealand
Turners & Growers Ltd Fresh produce wholesaler and auctioneer
GPG Holding 31 December 1998
44.49%
|
1 | 60054892_b0 | 60054892 | registered members) so as to arrive not later than 48 hours before the time appointed for the meeting. Completion and return of the appropriate form of proxy enclosed with this Notice will not preclude a member from attending and voting at the meeting in person should he find himself able to do so.
3. No director has a service contract with the Company or any subsidiary. 4. A summary of the proceedings at the Annual General Meeting of the Company will be made available upon request to any shareholder
applying to any one of the Company's share registrars whose locations are set out on page # or to the Secretary, Guinness Peat Group plc, 2nd Floor, 21-26 Garlick Hill, London EC4V 2AU.
49
Guinness Peat Group plc
Guinness Peat Group plc
United Kingdom
2nd Floor. 21-26 Garlick Hill, London EC4V 2AU Tel: 0171 236 0336 Fax: 0171 329 8870
Australia
c/o Pannell Kerr Forster Level 20, 1 York Street, Sydney NSW 2000 Tel: 02 9251 4100 Fax: 02 9251 3832
New Zealand
c/o Registry Managers (New Zealand) Limited Private Bag 92119, Auckland 1030, New Zealand Tel. or Fax: 09 524 2150
Registered in England No. 159975
Location of share registers
The Company's register of members is maintained in the UK with branch registers in Australia and New Zealand. Register enquiries may be addressed direct to the Company's share registrars named below:
UK main register: Computershare Services plc
Australian Register: Registries Ltd
New Zealand Register: Computershare Registry Services Limited
Telephone and postal enquiries Owen House, Bankhead Crossway North Edinburgh EH11 4BR Tel: 0131 523 6666 Fax: 0131 452 4924
PO Box R67 Royal Exchange, Sydney NSW1224 Tel: 02 9279 0677 Fax: 02 9279 0664
Private Bag 92119, Auckland 1020 Tel: 09 522 0022 Fax: 09 522 0058
Inspection of Register 7th Floor, Jupiter House Triton Court, 14 Finsbury Square London EC2A 1BR
Level 2, 28 Margaret Street Sydney NSW 2000
Level 3, 277 Broadway Newmarket, Auckland
50
|
1 | 60054892_b1 | 60054892 | Peat Group plc 1992 Share Option Scheme so as to increase the individual limit to £4m worth of shares.
REGISTERED OFFICE: 2nd floor 21-26 Garlick Hill London EC4V 2AU
BY ORDER OF THE BOARD Richard Russell SECRETARY 16 April 1999
48
Guinness Peat Group plc
Notes to Notice of Meeting
1. A member of the Company entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and, on a poll, to vote instead of the member. A proxy need not be a member of the Company. A relevant form of proxy is enclosed.
2. Forms of proxy and a Power of Attorney or other authority, if any, under which they are signed or a notarially certified copy of a power or authority should be sent to Computershare Services PLC, PO Box 457, Owen House, 8 Bankhead Crossway North, Edinburgh EH11 0XG (from UK registered members), Computershare Registry Services, Private Bag 92119, Auckland 1020 (from New Zealand registered members) or Registries Limited, PO Box R67, Royal Exchange, Sydney NSW 1224 (from Australian registered members) so as to arrive not later than 48 hours before the time appointed for the meeting. Completion and return of the appropriate form of proxy enclosed with this Notice will not preclude a member from attending and voting at the meeting in person should he find himself able to do so.
3. No director has a service contract with the Company or any subsidiary. 4. A summary of the proceedings at the Annual General Meeting of the Company will be made available upon request to any shareholder
applying to any one of the Company's share registrars whose locations are set out on page # or to the Secretary, Guinness Peat Group plc, 2nd Floor, 21-26 Garlick Hill, London EC4V 2AU.
49
Guinness Peat Group plc
Guinness Peat Group plc
United Kingdom
2nd Floor. 21-26 Garlick Hill, London EC4V 2AU Tel: 0171 236 0336 Fax: 0171 329 8870
Australia
c/o Pannell Kerr Forster Level 20, 1 York Street, Sydney NSW 2000 Tel: 02 9251 4100 Fax: 02 9251 3832
New Zealand
c/o Registry Managers ( |
1 | 60054895_0 | 60054895 | COVER: Bodycote is proud to have made a small but significant contribution to the success of the space shuttle. The Bodycote Omnitest laboratory in Houston, Texas was chosen to test the weld procedures used in the manufacture of the space shuttle's critical liquid oxygen fuel tanks. The `planets' in the picture are micrographic enlargements of components treated and tested within the group.
Contents
3 Financial highlights 4 Chairman's statement 6 Managing Director's report 8 Review of operations 17 Directors' report 22 Corporate governance 24 Board Remuneration report 26 Directors and advisers 27 Directors' responsibility statement 27 Report of the auditors 28 Group profit and loss account 29 Balance sheets 30 Group cash flow statement 31 Statements of total
recognised gains and losses 31 Reconciliations of movements
in shareholders' funds 31 Note of historical cost
profit and losses 32 Accounting policies 33 Notes on the accounts 47 Group five year financial summary 48 Principal subsidiary undertakings
Financial calendar
Bodycote... an international group providing a range of metallurgical processing services to industry
Financial highlights
TURNOVER PROFIT BEFORE TAXATION* HEADLINE EARNINGS PER SHARE HEADLINE DILUTED EARNINGS PER SHARE BASIC EARNINGS PER SHARE DIVIDEND PER SHARE
1998
1997
£000
£000
319,968 206,543
76,772 50,513
53.3p 39.6p
52.7p 39.4p
52.5p 40.2p
12.0p
9.1p
76.8 15.0
18.5 28.0 39.6 53.3
4.9 5.5 6.7 9.1 12.0
*
*Profit before taxation is stated before amortisation of goodwill and exceptional profit.
4.4
3
Chairman's statement
In a year of difficult markets and uncertain business conditions, Bodycote again produced a set of excellent results. Profit before tax, amortisation of goodwill and exceptional items was £76.8 million, a 52% increase over the previous year (1997: £50.5 million). Earnings per share increased to 53.3p from 39.6p last year, a rise of 35%.
Your directors are recommending a final dividend of 7.75p |
1 | 60054895_1 | 60054895 | BASIC EARNINGS PER SHARE DIVIDEND PER SHARE
1998
1997
£000
£000
319,968 206,543
76,772 50,513
53.3p 39.6p
52.7p 39.4p
52.5p 40.2p
12.0p
9.1p
76.8 15.0
18.5 28.0 39.6 53.3
4.9 5.5 6.7 9.1 12.0
*
*Profit before taxation is stated before amortisation of goodwill and exceptional profit.
4.4
3
Chairman's statement
In a year of difficult markets and uncertain business conditions, Bodycote again produced a set of excellent results. Profit before tax, amortisation of goodwill and exceptional items was £76.8 million, a 52% increase over the previous year (1997: £50.5 million). Earnings per share increased to 53.3p from 39.6p last year, a rise of 35%.
Your directors are recommending a final dividend of 7.75p per share, making a total dividend for the year of 12.0p per share (1997: 9.1p), an increase of 32%. The dividend is covered 4.4 times by earnings. These figures have been adjusted to take into account the one for four rights issue completed in January 1998.
Your directors have also decided to recommend that the share capital of the company should be re-organised so that the share price is brought more into line with the share prices of other companies in its sector. The re-organisation will involve the splitting of each existing 25p ordinary share into five separate 5p ordinary shares, followed immediately by the consolidation of every two 5p nominal shares into one new 10p ordinary share. This will mean shareholders currently holding 10,000 25p ordinary shares, will instead receive 25,000 new 10p ordinary shares.
As in previous years, solid organic growth was supplemented by contributions from carefully selected acquisitions which had to meet strict investment criteria. Prominent amongst these were the French subsidiary HIT SA and the UK based Thermal Processing Group both of which produced very good results. Excluding growth derived from the acquisitions made during 1998, those businesses comprising the group as at 31 December 1997 achieved sales and profits growth in the year of 9% |
1 | 60054895_2 | 60054895 | per share, making a total dividend for the year of 12.0p per share (1997: 9.1p), an increase of 32%. The dividend is covered 4.4 times by earnings. These figures have been adjusted to take into account the one for four rights issue completed in January 1998.
Your directors have also decided to recommend that the share capital of the company should be re-organised so that the share price is brought more into line with the share prices of other companies in its sector. The re-organisation will involve the splitting of each existing 25p ordinary share into five separate 5p ordinary shares, followed immediately by the consolidation of every two 5p nominal shares into one new 10p ordinary share. This will mean shareholders currently holding 10,000 25p ordinary shares, will instead receive 25,000 new 10p ordinary shares.
As in previous years, solid organic growth was supplemented by contributions from carefully selected acquisitions which had to meet strict investment criteria. Prominent amongst these were the French subsidiary HIT SA and the UK based Thermal Processing Group both of which produced very good results. Excluding growth derived from the acquisitions made during 1998, those businesses comprising the group as at 31 December 1997 achieved sales and profits growth in the year of 9% and 19% respectively.
During the year £86 million was spent on capital expenditure and £77 million on acquisitions largely financed by the proceeds of the recent rights issue. Net borrowings at the year end were £30.7 million (1997: £46.7 million), which represents gearing of 10%. The group operating margin was maintained at around last year's level with the return on capital employed increasing from 25.8% to 28.4%.
The group is the largest provider of subcontract metallurgical services in the world. This position has been achieved through significant investment into technically sophisticated plant and processes. This investment policy, supplemented by acquisitions where appropriate, has given Bodycote an excellent opportunity to capitalise on its leading positions in its chosen markets. A typical example is the new US $20 million hot isostatic pressing (HIP) facility at Camas, Washington State, USA for the processing of technically advanced aerospace and other industrial components.
4
In addition to building its own facilities to meet market demand, the group is becoming increasingly successful in setting up strategic partnerships with major industrial companies whereby in-house metallurgical services are replaced by new facilities owned and managed by Bodycote. A good example is the new £7 million plant |
1 | 60054895_3 | 60054895 | and 19% respectively.
During the year £86 million was spent on capital expenditure and £77 million on acquisitions largely financed by the proceeds of the recent rights issue. Net borrowings at the year end were £30.7 million (1997: £46.7 million), which represents gearing of 10%. The group operating margin was maintained at around last year's level with the return on capital employed increasing from 25.8% to 28.4%.
The group is the largest provider of subcontract metallurgical services in the world. This position has been achieved through significant investment into technically sophisticated plant and processes. This investment policy, supplemented by acquisitions where appropriate, has given Bodycote an excellent opportunity to capitalise on its leading positions in its chosen markets. A typical example is the new US $20 million hot isostatic pressing (HIP) facility at Camas, Washington State, USA for the processing of technically advanced aerospace and other industrial components.
4
In addition to building its own facilities to meet market demand, the group is becoming increasingly successful in setting up strategic partnerships with major industrial companies whereby in-house metallurgical services are replaced by new facilities owned and managed by Bodycote. A good example is the new £7 million plant at Rolls-Royce, Derby, England which will heat treat, HIP and stress rupture test all Rolls-Royce aero-engine turbine blade production in the United Kingdom. The group however, is only at the early stages of making significant inroads into the large in-house metallurgical processing market and there is considerable scope to develop this concept further. Additionally, there are still many quality acquisition possibilities. Bodycote is well placed to respond to these opportunities.
Two further strengths of the group are tight and responsive cost control and a committed management team. This is being further improved by the appointment of a new Finance Director, David Landless, aged 39, who was Finance Director of Courtaulds Coatings Division now part of Akzo Nobel UK. He joined Bodycote in March 1999 and, having spent the last 14 years with Courtaulds both in the UK and the USA, well understands the demands of working within a multinational group.
It is pleasing to note that a record number of engineering students submitted papers for the annual Bodycote Metallurgical Prize. Submissions were received from the United States, the UK and other European countries. The prize is promoted by the Bodycote Educational Foundation which supports student placements and training opportunities worldwide. |
1 | 60054895_b0 | 60054895 | 49
Principal subsidiary undertakings
Metal Technology continued
Country of Incorporation or Registration
Materials Testing continued
Bodycote Technitrol Inc. Bodycote Met-Chem Inc. Bodycote Ortech Inc.
Montreal Detroit Mississauga
Canada USA
Canada
Testing services for producers and users. Mechanical, corrosion, physical and chemical testing of ferrous and non-ferrous alloys, building products, ceramics, composites and plastics. Healthcare testing, microbiological assessment, water analysis, fire, drug, pharmaceutical and food product testing.
Metallurgical Coatings
*Bodycote Metallurgical Coatings Limited Harvey Plating Limited *John H Mason Limited *Parstream Limited t/a Lymington Plating Hauzer Coating Centrum BV *Bodycote SHU Coatings Limited West Middlesex Plating Co. Limited Bodycote de Mexico SA de CV Ytintressenter AB
Wolverhampton, Rochdale, Caerphilly Darlington Rotherham Lymington Venlo Sheffield Uxbridge Tecate Solna, Spånga, Järfälla and Iggesund
England England England England Netherlands England England Mexico Sweden
Anti-corrosion processing including sherardizing, mechanical plating, zinc electroplating, phosphating, shot blasting and metal plating.
Equipment Manufacture
Bodycote Mahler Anlagenbau GmbH Schmetz GmbH Hauzer Techno Coating Europe BV B.M.I. Fours Industriels
Esslingen Menden Venlo St Quentin Fallavier
Germany Germany Netherlands
France
Manufacture of vacuum and mesh belt furnaces and physical vapour deposition coatings equipment.
Industrial and General
*Thomas Cook & Son Insurance Brokers Limited (75% owned)
Burnley
England
Insurance broking, industrial and commercial risk management, life assurance and pension consultants, independent financial advisers.
*Bodycote Developments Limited
Baildon
Managers of the group's property interests in Baildon.
England
Except where stated, these companies are wholly owned subsidiaries and have only one class of issued shares. Subsidiaries marked with an asterisk* are held directly by Bodycote International plc.
50
|
1 | 60054895_b1 | 60054895 | Bodycote Industrial Materials Technology GmbH Essen, Haag
Bodycote IMT NV
Sint-Niklaas
Bodycote Powdermet AB
Surahammar
*Bodycote Infutec Limited
Chesterfield
England USA
USA Germany Belgium
Sweden England
Application of the hot isostatic process and the manufacture of specialist steels and products using hot isostatic pressing technology.
Materials Testing
Bodycote Materials Testing Limited
Bodycote Materials Testing BV Bodycote Materials Testing A/S Bodycote Materials Testing Srl MTS International Holdings Limited Bodycote Taussig Inc. Bodycote Omnitest Inc. Bodycote Galt Materials Testing Limited Bodycote Metal Analysis Inc. Bodycote Industrial Testing Limited
Newbridge, Glasgow, Scunthorpe, Middlesbrough, Salford, Brierley Hill, Daventry, Bridgwater, Dudley, Newcastle Emmen, Spijkenisse and Arnheim Sandnes Milan Abu Dhabi Chicago Houston Cambridge and Burlington Los Angeles St Louis
Scotland
Netherlands Norway Italy
Guernsey USA USA
Canada USA USA
49
Principal subsidiary undertakings
Metal Technology continued
Country of Incorporation or Registration
Materials Testing continued
Bodycote Technitrol Inc. Bodycote Met-Chem Inc. Bodycote Ortech Inc.
Montreal Detroit Mississauga
Canada USA
Canada
Testing services for producers and users. Mechanical, corrosion, physical and chemical testing of ferrous and non-ferrous alloys, building products, ceramics, composites and plastics. Healthcare testing, microbiological assessment, water analysis, fire, drug, pharmaceutical and food product testing.
Metallurgical Coatings
*Bodycote Metallurgical Coatings Limited Harvey Plating Limited *John H Mason Limited *Parstream Limited t/a Lymington Plating Hauzer Coating Centrum BV *Bodycote SHU Coatings Limited West Middlesex Plating Co. Limited Bodycote de Mexico SA de CV Ytintressenter AB
Wolverhampton, Rochdale, Caerphilly Darlington Rotherham Lymington Venlo Sheffield Uxbridge Tecate Solna, Spånga, Järfälla and Iggesund
England England England |
1 | 60054897_0 | 60054897 | Company Profile Enterprise Oil plc Annual Report and Accounts
Enterprise Oil is one of the world's leading independent oil exploration and production companies and is listed on the London and New York stock exchanges. Our business is to provide shareholders with capital and income growth through the discovery, development and acquisition of oil and gas reserves. In all of our activities we are committed to protecting the environment and promoting the health and safety of staff and contractors. Our objective is to be the most successful finder and producer of hydrocarbons by exploiting, with integrity, our differences and unique skills; encouraging creativity and nurturing an environment in which the best people want to work towards delivering a strong growth in values.
C o n t e n t s
2 Chairman's Statement 3 Financial Highlights 4 Chief Executive's Review 10 Review of Operations 27 Year 2000 28 Health, Safety and the Environment 30 Financial Review 34 Board of Directors 36 Report of the Directors 43 Directors' Responsibilities for the
Financial Statements 44 Auditor's Report 45 Financial Statements
45 Consolidated Profit and Loss Account 46 Balance Sheets 47 Consolidated Cash Flow Statement 47 Consolidated Statement of Total
Recognised Gains and Losses 48 Statement of Accounting Policies 50 Notes to the Financial Statements 65 Five Year Financial Summary 66 Reserves and Drilling Statistics 67 Shareholder Information 69 Notice of Meeting 70 Explanatory Notes 71 Glossary of Terms
Sites : Key Well
Cerro Falcone-1
Volturino-1
Monte Enoc-1 A l l i
Val d'Agri Oil Centre Monte Alpi-4
Monte Alpi-1 & -2 Monte Alpi-3
Costa Molina-2
Satellite image (250 km2) of the Val d'Agri region of Italy's Southern Apennines the location of Enterprise Oil's interests in the Monte Alpi and Cerro Falcone fields and the Val d'Agri oil centre.
Enterprise Oil Chairman's Statement
"We cannot rely on external circumstances to improve the group's underlying financial performance the solutions must come from within and our management team is responding well to the task ahead of us. In this environment it is essential we focus on value and the improvement of margins."
Sir Graham Hearne /Chairman
Dear Shareholder 1998 was the toughest year in your company's history. The impact of the continuing decline in the oil price overwhelmed some undoubted operational successes. The consequence has been that we are |
1 | 60054897_1 | 60054897 | illing Statistics 67 Shareholder Information 69 Notice of Meeting 70 Explanatory Notes 71 Glossary of Terms
Sites : Key Well
Cerro Falcone-1
Volturino-1
Monte Enoc-1 A l l i
Val d'Agri Oil Centre Monte Alpi-4
Monte Alpi-1 & -2 Monte Alpi-3
Costa Molina-2
Satellite image (250 km2) of the Val d'Agri region of Italy's Southern Apennines the location of Enterprise Oil's interests in the Monte Alpi and Cerro Falcone fields and the Val d'Agri oil centre.
Enterprise Oil Chairman's Statement
"We cannot rely on external circumstances to improve the group's underlying financial performance the solutions must come from within and our management team is responding well to the task ahead of us. In this environment it is essential we focus on value and the improvement of margins."
Sir Graham Hearne /Chairman
Dear Shareholder 1998 was the toughest year in your company's history. The impact of the continuing decline in the oil price overwhelmed some undoubted operational successes. The consequence has been that we are able to report only a small profit at the post-tax level, of £7.8 million compared with £126.6 million in 1997. And at the pre-tax level we have to report a loss of £19.5 million as against a profit of £254.8 million the previous year.
The main influence has been our oil price realisations which fell by almost one third in 1998, to an average of $12.92 (£7.84) as against $19.22 (£11.74) in the previous year. In recent months we have seen prices remain in the $10$11 per barrel range and it is difficult to predict when any sustained improvement will occur. As I have said before, we cannot rely on external circumstances to improve the group's underlying financial performance the solutions must come from within and our management team is responding well to the task ahead of us.
We continue to be successful with the drill bit, replacing 242 per cent of our 1998 production at 195,133 barrels of oil equivalent per day and giving an average reserve replacement ratio over the 15 year history of the company of almost 200 per cent. Our cost-effective development programme is providing an impetus for continued growth in cash flow. Three |
1 | 60054897_2 | 60054897 | able to report only a small profit at the post-tax level, of £7.8 million compared with £126.6 million in 1997. And at the pre-tax level we have to report a loss of £19.5 million as against a profit of £254.8 million the previous year.
The main influence has been our oil price realisations which fell by almost one third in 1998, to an average of $12.92 (£7.84) as against $19.22 (£11.74) in the previous year. In recent months we have seen prices remain in the $10$11 per barrel range and it is difficult to predict when any sustained improvement will occur. As I have said before, we cannot rely on external circumstances to improve the group's underlying financial performance the solutions must come from within and our management team is responding well to the task ahead of us.
We continue to be successful with the drill bit, replacing 242 per cent of our 1998 production at 195,133 barrels of oil equivalent per day and giving an average reserve replacement ratio over the 15 year history of the company of almost 200 per cent. Our cost-effective development programme is providing an impetus for continued growth in cash flow. Three new fields have been brought on stream so far this year Pierce, Banff and Siri.
But in this environment it is essential that we focus on value and the improvement of margins. To this end we have reduced our cost of sales, to £5.63 per barrel as against £6.39 in 1997. We have accelerated a programme of internal restructuring designed to achieve a significant reduction in our cost base below 1998 levels a programme involving reducing staffing levels by about 200 people.
We have also been alert to opportunities to dispose of noncore assets while the market permitted. It is a mark of our conservative approach to the financial structure of the business
that the write-down in the carrying value of our oil and gas assets of some £31 million, reflecting the low oil price, is relatively modest in the context of the overall asset value of the business.
As I mentioned in my Interim Statement, the dividend policy has been reviewed in the light of these results and the need going forward to create an appropriate balance between our cost structure, profitability and returns to shareholders. As a result of this review we are not proposing to pay a final dividend. This means that having paid an unchanged 6.9 pence per share dividend in the first half, |
1 | 60054897_3 | 60054897 | new fields have been brought on stream so far this year Pierce, Banff and Siri.
But in this environment it is essential that we focus on value and the improvement of margins. To this end we have reduced our cost of sales, to £5.63 per barrel as against £6.39 in 1997. We have accelerated a programme of internal restructuring designed to achieve a significant reduction in our cost base below 1998 levels a programme involving reducing staffing levels by about 200 people.
We have also been alert to opportunities to dispose of noncore assets while the market permitted. It is a mark of our conservative approach to the financial structure of the business
that the write-down in the carrying value of our oil and gas assets of some £31 million, reflecting the low oil price, is relatively modest in the context of the overall asset value of the business.
As I mentioned in my Interim Statement, the dividend policy has been reviewed in the light of these results and the need going forward to create an appropriate balance between our cost structure, profitability and returns to shareholders. As a result of this review we are not proposing to pay a final dividend. This means that having paid an unchanged 6.9 pence per share dividend in the first half, the total dividend for the year will be 6.9 pence as against 17.4 pence in 1997.
Given our resource base and financial strength, Enterprise is able to make good progress in its present form, even in the current market conditions. However, the Board has been investigating whether faster progress can be made by other means. Specifically, as you know, we have been exploring the possibility of an agreed merger
with LASMO, a company similarly focused on exploration and production but where considerable complementarity exists in the respective portfolios.
This would not be a merger based upon scale for its own sake it would have to be based on the merits of achieving significant synergies and a combination of assets which can be managed to redeploy capital, improve the consistency of investment returns and deliver value for shareholders in an uncertain environment. This cannot be taken for granted both companies must be convinced of the merits.
Finally, on behalf of the Board, I would like to pay a special thanks to management and staff for their hard work and commitment during this past challenging year.
Sir Graham Hearne Chairman
2 Annual Report `98
Sir Graham Hearne/Chairman
Financial Highlights Tu rn o v e r Operating (Loss |
1 | 60054897_b0 | 60054897 | to appoint one or more proxies to attend and, on a poll, to vote on their behalf. A proxy need not be a member of the company. To be effective forms of proxy and any power of attorney or other authority under which it is signed or a notarially certified copy of such power of authority must be duly completed and lodged with the company's registrars, Bank of Scotland Registrars, Apex House, 9 Haddington Place, Edinburgh EH7 4AL, at least 48 hours before the time appointed for holding the meeting, or adjourned meeting, as the case may be. 2. The appointment of a proxy does not preclude members from attending the meeting and voting if they so wish. 3. Pursuant to Regulation 34 of the Uncertificated Securities Regulations 1995, the company specifies that only those shareholders registered in the register of members of the company as at midday on 18 May 1999 will be entitled to attend and vote at the meeting in respect of the number of shares registered in their name at that time. Subsequent changes to the entries on the register will be disregarded in determining the rights of any person to attend and vote at the meeting. Resolutions 2 and 3. Mr J K Grieves and Mr K N Henry are standing for re-election as non-executive directors. They do not have service contracts with the company. They are both members of the Audit, Nomination and Remuneration Committees of the Board. Mr Grieves is the Chairman of the Audit Committee and is a Trustee of the Pension Scheme. Their biographical details appear on page 34. Resolution 5. This resolution empowers the directors to allot shares for cash otherwise than pro rata to existing shareholders but this power is limited to allotments in connection with a rights issue and otherwise to five per cent of the issued share capital of the company as at the date of the passing of the resolution or approximately 24.8 million shares. The authority conferred by this resolution will expire no later than 15 months from the date on which the resolution is passed.
71 Annual Report '98
Annual Report '98 71
Enterprise Oil Financial Statements
Designed by Pauffley. Produced by VANWYKE consulting. Photography by Damian Gillie, Michael Heffernan and Rohan Van Twest. Typeset by Generator Limited. Printed in England by Litho-Tech.
72 Annual Report '98
Annual Report '98 72
|
1 | 60054897_b1 | 60054897 | may deem necessary or expedient to deal with fractional entitlements otherwise existing, legal or practical problems arising in any overseas territory or by virtue of shares being represented by depositary receipts, the requirements of any regulatory body or stock exchange, or any other matter whatsoever; and 5.2 to the allotment (otherwise than pursuant to 5.1 above) of equity securities up to an aggregate nominal value equal to five per cent of the issued ordinary share capital of the company at the date of the passing of this resolution; and shall expire at the conclusion of the Annual General Meeting of the company in 2000 or 19 August 2000 whichever is the earlier, save that the company may before such expiry make an offer or agreement which would or might require equity securities to be allotted after such expiry and the directors may allot equity securities in pursuance of such offer or agreement as if the power conferred hereby had not expired. By order of the Board Vivien Gaymer Secretary 14 April 1999 Grand Buildings, Trafalgar Square, London WC2N 5EJ
70 Annual Report '98
Annual Report '98 70
Enterprise Oil Financial Statements
Glossary of Terms
Notes: 1. Members entitled to attend and vote at the meeting are entitled to appoint one or more proxies to attend and, on a poll, to vote on their behalf. A proxy need not be a member of the company. To be effective forms of proxy and any power of attorney or other authority under which it is signed or a notarially certified copy of such power of authority must be duly completed and lodged with the company's registrars, Bank of Scotland Registrars, Apex House, 9 Haddington Place, Edinburgh EH7 4AL, at least 48 hours before the time appointed for holding the meeting, or adjourned meeting, as the case may be. 2. The appointment of a proxy does not preclude members from attending the meeting and voting if they so wish. 3. Pursuant to Regulation 34 of the Uncertificated Securities Regulations 1995, the company specifies that only those shareholders registered in the register of members of the company as at midday on 18 May 1999 will be entitled to attend and vote at the meeting in respect of the number of shares registered in their name at that time. Subsequent changes to the entries on the register will be disregarded in determining the rights of any person to attend and vote at the meeting. Resolutions 2 and 3. Mr J K Grieves and Mr K N |
1 | 60054918_0 | 60054918 | Chelsfield plc
Report and Accounts 1998
Report and accounts 1998
Contents
Page
Chairman's statement
2
Financial highlights
6
Directors, officers and advisers
8
Directors' biographies
9
Directors' report
11
Corporate governance
15
Directors' report on remuneration
17
Directors' responsibilities
19
Report of the auditors
20
Consolidated profit and loss account
21
Consolidated balance sheet
22
Company balance sheet
23
Statement of consolidated total recognised gains and losses
24
Note of consolidated historical cost profits and losses
24
Reconciliation of movements in consolidated shareholders' funds
24
Consolidated cash flow statement
25
Statement of accounting policies
26
Notes to the accounts
28
Principal subsidiary undertakings
42
Principal joint ventures
43
Major properties
44
Summary of past results
46
Notice of Annual General Meeting
47
1111 11
Chelsfield plc
Chairman's statement
I am pleased to report that the quiet advancement which characterised the first half performance was maintained through the full year.
The growth in shareholders' funds is the principal indication by which your Board seeks to evaluate performance. Aggregate shareholders' funds at 31 December 1998 reached £735 million with sound levels of distributable reserves. Net assets per share reached 306p, some 13 per cent higher than the figure of 272p per share reported at the end of the previous year and an increase of 36 per cent over the comparable figure at 31 December 1996. The progression can be seen to be consistent with the sustained profile of asset growth which the group has established.
Profit before taxation for 1998 of £22.5 million was down from £24.6 million for the previous year, notwithstanding the higher profits recorded at the interim stage. After benefiting from a reduced tax charge, earnings per share of 7.3p for 1998 compared with 8.1p for the previous year.
The headline profit figures mask a continuing consolidation in the strength of the group's underlying operations. Group operating profit was substantially higher at £46.9 million for 1998 as against £39.0 million for the previous |
1 | 60054918_1 | 60054918 |
1111 11
Chelsfield plc
Chairman's statement
I am pleased to report that the quiet advancement which characterised the first half performance was maintained through the full year.
The growth in shareholders' funds is the principal indication by which your Board seeks to evaluate performance. Aggregate shareholders' funds at 31 December 1998 reached £735 million with sound levels of distributable reserves. Net assets per share reached 306p, some 13 per cent higher than the figure of 272p per share reported at the end of the previous year and an increase of 36 per cent over the comparable figure at 31 December 1996. The progression can be seen to be consistent with the sustained profile of asset growth which the group has established.
Profit before taxation for 1998 of £22.5 million was down from £24.6 million for the previous year, notwithstanding the higher profits recorded at the interim stage. After benefiting from a reduced tax charge, earnings per share of 7.3p for 1998 compared with 8.1p for the previous year.
The headline profit figures mask a continuing consolidation in the strength of the group's underlying operations. Group operating profit was substantially higher at £46.9 million for 1998 as against £39.0 million for the previous twelve month period. Net rental income was up modestly at £37.2 million but trading sales of properties held as stock made a substantial contribution of £8.5 million, perhaps reflecting a changing sense of balance within the market. Net rental receipts in the current year can be expected to show renewed increase as reversionary review settlements at Merry Hill become translated into reported results.
Unlike in 1997, when profits were buoyed by a particularly good contribution from joint ventures, last year the swing was in the opposite direction. The 1998 figures were adversely impacted by the disposal of all remaining assets held in Laing Properties Inc and the closure of the office in Atlanta. The resulting marginal operating loss generated by joint ventures for 1998 is in stark contrast to the £15.4 million profit from joint ventures included in the results for 1997.
The largest driver to reported net asset growth remains our combined investment at Brierley Hill in the West Midlands. We continue to account for our holding in two parts. The carrying value of the existing retail and leisure assets at Merry Hill was appraised at £500 million, which gave rise to a revaluation surplus over the year of £56 million. The investment growth is founded on sustained retail performance. The appraisal represents an approximate yield of |
1 | 60054918_2 | 60054918 | twelve month period. Net rental income was up modestly at £37.2 million but trading sales of properties held as stock made a substantial contribution of £8.5 million, perhaps reflecting a changing sense of balance within the market. Net rental receipts in the current year can be expected to show renewed increase as reversionary review settlements at Merry Hill become translated into reported results.
Unlike in 1997, when profits were buoyed by a particularly good contribution from joint ventures, last year the swing was in the opposite direction. The 1998 figures were adversely impacted by the disposal of all remaining assets held in Laing Properties Inc and the closure of the office in Atlanta. The resulting marginal operating loss generated by joint ventures for 1998 is in stark contrast to the £15.4 million profit from joint ventures included in the results for 1997.
The largest driver to reported net asset growth remains our combined investment at Brierley Hill in the West Midlands. We continue to account for our holding in two parts. The carrying value of the existing retail and leisure assets at Merry Hill was appraised at £500 million, which gave rise to a revaluation surplus over the year of £56 million. The investment growth is founded on sustained retail performance. The appraisal represents an approximate yield of 6.5 per cent against current estimated reversionary income approaching £32 million per annum. The yield is some 0.5 per cent lower than that applied last year to reflect that rent reversions are now falling due. The second element comprises separately acquired interests beyond the boundaries of the original investment purchase. These interests aggregate some 86 acres of land and are carried at £48 million, which includes the capital cost of canal improvements and other preparatory infrastructure works.
Merry Hill continues to show within the top five retail locations in national comparisons and has effectively no voids. The majority of outstanding rent reviews fall due in or before March 2000 and settlements being achieved in the current round are generally ahead by 80 to 100 per cent over those agreed 5 years ago. The review evidence is established at £185 per square foot for zone A. Were space available, our expectation is that new lettings would be better again and that prime positions could command rents above £200 per square foot for zone A.
We are also convinced as to the wider strategic potential of a high level metropolitan centre at Brierley Hill within the West Midlands conurbation. This conviction has informed successive land purchases, including the freehold and development rights to the Waterfront commercial quarter. Total land holdings |
1 | 60054918_3 | 60054918 | 6.5 per cent against current estimated reversionary income approaching £32 million per annum. The yield is some 0.5 per cent lower than that applied last year to reflect that rent reversions are now falling due. The second element comprises separately acquired interests beyond the boundaries of the original investment purchase. These interests aggregate some 86 acres of land and are carried at £48 million, which includes the capital cost of canal improvements and other preparatory infrastructure works.
Merry Hill continues to show within the top five retail locations in national comparisons and has effectively no voids. The majority of outstanding rent reviews fall due in or before March 2000 and settlements being achieved in the current round are generally ahead by 80 to 100 per cent over those agreed 5 years ago. The review evidence is established at £185 per square foot for zone A. Were space available, our expectation is that new lettings would be better again and that prime positions could command rents above £200 per square foot for zone A.
We are also convinced as to the wider strategic potential of a high level metropolitan centre at Brierley Hill within the West Midlands conurbation. This conviction has informed successive land purchases, including the freehold and development rights to the Waterfront commercial quarter. Total land holdings are approximately 211 acres. A far reaching development framework prepared by the local authority has been the subject of public presentations across Dudley Borough. That framework envisages the enlarged Brierley Hill as the principal location for commercial and retail development within the Borough. The intention is that the framework will become incorporated into the Unitary Development Plan for Dudley, which is currently in the process of review and revision.
1112 11
Chelsfield plc
Over the next twelve to eighteen months, shareholders can expect to see manifestations of the unashamedly collaborative approach to development. Terms are being negotiated for a new 20 screen multiplex and entertainment facility to be built to a landmark Chris Wilkinson design alongside the canal. The building is an integral part of a broader set of proposals directed toward Brierley Hill High Street, which aggregates some 225,000 square feet and includes additional restaurants and a second hotel. Application has been made for 600,000 square feet of additional commercial accommodation at the Waterfront and 180,000 square feet of new residential. Construction will be phased over a number of years but residential demand is judged to be strong and the commercial application has been prompted by existing pre-letting enquiries.
A series of detailed planning applications relating to White City were formally |
1 | 60054918_b0 | 60054918 | the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which the ordinary shares are contracted to be purchased;
(d) the authority hereby conferred shall expire on the earlier of 21 August 2000 and the conclusion of the next Annual General Meeting of the company (the `Expiry Date'), unless the authority is renewed prior to the Expiry Date;
(e) the company may purchase ordinary shares under this authority after the Expiry Date pursuant to a contract entered into before the Expiry Date; and
(f) the authority hereby conferred is in substitution for any existing authority to purchase ordinary shares under Section 166 of the Act.
By order of the board
KA Cook Secretary
8 April 1999
Notes:
(i) A member entitled to attend and vote at the above meeting may appoint one or more proxies to attend and, on a poll, to vote on his behalf. A proxy need not be a member of the company.
(ii) Proxy forms, to be valid, must be returned so as to be received by the company's registrars, Lloyds TSB Registrars, The Causeway, Worthing, West Sussex BN99 6DB no later than 48 hours before the time of the meeting. Completion of a proxy form will not preclude attendance and voting at the meeting.
(iii) Pursuant to Regulation 34 of the Uncertificated Securities Regulations 1995, the company gives notice that only those shareholders registered in the register of members of the company at 6.00 pm on Wednesday 19 May 1999 will be entitled to attend or vote at the aforesaid meeting in respect of the number of shares registered in their name at that time. Changes to entries on the register after 6.00 pm on Wednesday 19 May 1999 will be disregarded in determining the rights of any person to attend or vote at the meeting.
(iv) Particulars of the directors' transactions in the share capital of the company will be available for inspection at the registered office of the company during normal business hours on any weekday (Saturdays and public holidays excepted) up to and including the date of the meeting and at the place of the meeting and for fifteen minutes prior to the meeting and during the meeting. There are no directors' service contracts terminable on notice of more than one year or more.
1114811
Chelsfield plc
Printed by Royle Print Limited, London 15795
|
1 | 60054918_b1 | 60054918 | (continued)
(iii) otherwise than pursuant to (i) or (ii) above for cash up to an aggregate nominal amount equal to £2,400,735 (being 5 per cent of the issued ordinary share capital of the company at 31 December 1998),
save that the company may before the expiry of the power hereby conferred make an offer or agreement which would or might require equity securities to be allotted after such expiry and the directors may allot equity securities in pursuance of such offer or agreement as if the power conferred had not expired.
7 That, pursuant to Section 166 of the Companies Act 1985 (the `Act'), the company is hereby generally and unconditionally authorised to make market purchases (within the meaning of Section 163 of the Act) of ordinary shares of 20p each in the capital of the company (`ordinary shares') provided that:
(a) the maximum number of ordinary shares that may be purchased is 24,007,351;
(b) the minimum price which may be paid for an ordinary share is 20p;
(c) the maximum price which may be paid for an ordinary share is an amount equal to 105% of the average of the middle market quotations for an ordinary share as derived from the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which the ordinary shares are contracted to be purchased;
(d) the authority hereby conferred shall expire on the earlier of 21 August 2000 and the conclusion of the next Annual General Meeting of the company (the `Expiry Date'), unless the authority is renewed prior to the Expiry Date;
(e) the company may purchase ordinary shares under this authority after the Expiry Date pursuant to a contract entered into before the Expiry Date; and
(f) the authority hereby conferred is in substitution for any existing authority to purchase ordinary shares under Section 166 of the Act.
By order of the board
KA Cook Secretary
8 April 1999
Notes:
(i) A member entitled to attend and vote at the above meeting may appoint one or more proxies to attend and, on a poll, to vote on his behalf. A proxy need not be a member of the company.
(ii) Proxy forms, to be valid, must be returned so as to be received by the company's registrars, Lloyds TSB Registrars, The Causeway, Worthing, West Sussex BN99 6DB no later than |
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