Financial Highlights

John Foster, CEO said:

“The Group’s trading results for the six months to 30 September 2017 were encouraging with Profit Before Tax rising 38% to £1.4 million (2016: £1.0 million) and first half revenues exceeding £20 million for the first time in the Group’s history. It was also pleasing to see all three of the group’s operating businesses showing increased profitability compared to the prior year, with Momart in particular continuing to improve, posting sales and profit growth.

The Group’s balance sheet remained strong with £15.0 million of cash on hand at 30 September 2017, only £0.1 million lower than in March 2017 despite normal seasonal increases in working capital and the resumption of dividends which saw a payment of £0.5 million to shareholders in late September 2017. The Group’s cash balances of £15.0 million were £2.5 million higher than at 30 September 2016 and at the half year bank borrowings had been reduced by £0.2 million to £3.6 million compared to the year-end position (31 March 2017: £3.8 million).

Group revenues grew by 4.2% (+£0.8 million) to reach a record £20.6 million (2016: £19.8 million ) helped by revenues up 6.8% at Portsmouth Harbour Ferry Company (“PHFC”), buoyant revenues at Momart, which were £0.7 million up on the prior year (+7.4%) at £9.6 million (2016: £8.9 million) and stable overall activity levels in the Falkland Island Company (“FIC”).”


  Six months ended  
  2017
£'000
2016
£'000
Change
%
Turnover 20,605 19,771 +4.2
Underlying operating profit 1,621 1,261 +28.5
Share of Joint Venture underlying results 20 25 -20.0
Interest(net) inc. pension costs (238) (234) +1.7
Underlying profit before tax 1,403 1,016 +33.4
Amortisation of intangibles - (36) -100.0
Reported profit before tax 1,403 1,016 +38.1
Diluted earnings per share before amortisation and non-trading items 8.7p 6.2p +38.9
Weighted average shares in issue 12,453,705 12,430,505 +0.2

Group Financial Highlights

  • Group revenue increased 3.8% to £40.5 million (2016: £39.0 million)
  • Underlying pre-tax profits at £2.4 million (2016: £3.1 million)
  • Reported diluted earnings per share at 11.5 pence (2016: 17.9 pence)
  • EPS on underlying profits : 15.3 pence ( 2016:19.2 pence)
  • Cash balances increased to £15.1 million (2016: £14.0 million)
  • Bank borrowings of £3.8 million (2016: £3.3 million)
  • Net assets per share 320p (2016 310p)
  • The Board is recommending a final dividend of 4 pence per share for the year ended 31 March 2017

Operating Highlights

  • Revenue remained broadly flat at £8.58 million (2016: £8.56 million) despite challenging comparatives and absence of oil spend
  • Profit before Tax rose 10.9% to £0.58 million (2016: £0.52 million)
  • FBS (Construction) up 27.9% with favourable timing of kit home completions
  • Retail & Falklands 4x4 sales lower as expected
  • Support services up 11.7%
  • Normal, stronger second half trading anticipated
  • Longer term growth potential linked to oil and land-based tourism.
  • Total Ferry revenue increased 6.8% to £2.44 million (2016: £2.28 million) reflecting stable core revenues, additional cruising sales and one-off income from sale of ferry parts
  • Slower passenger volume decline more than offset by annual fare increases
  • Profit Before Tax increased by £0.18 million to £0.54 million (2016: £0.36 million) with tight cost control. Ferry passenger volumes volatile with continued appeal of inexpensive car travel and subsidised Park & Ride, but decline slowed by the completion of construction works at Portsmouth passenger interchange and the arrival of the Royal Navy’s new flagship in August 2017
  • Stable H2 outlook with normal quieter winter trading.
  • Positive momentum maintained, with unique expertise in complex work contributing to revenues increasing 7.4% to £9.59 million (2016: £8.93 million)
  • Record sales in Museums & Exhibitions, with 10.6% growth in Commercial Galleries and Auction Houses and 11.9% growth in Art Storage
  • Doubling of Profit Before Tax to £0.28 million despite drag of start-up losses at newly opened Leyton art storage facility
  • Notable activity included: “Matisse at Work” at the Royal Academy; “Abstract Expressionism” in Guggenheim Bilbao; “Scythian Nomads” at the British Museum; “Plywood” and “Balenciaga” at the V&A; and “Soul of a Nation” and “Giacometti” at Tate Modern
  • Progress in filling the new warehouse should contribute to satisfactory second half results despite intense market competition.

    After an encouraging first half’s trading, with profits ahead of the prior year in all three of the Group’s trading subsidiaries, the Group is well placed to deliver another solid set of results in the traditionally stronger second half. At Momart, despite an intensely competitive art market the company’s excellent reputation and technical ability should allow it to make further progress in improving margins. This together with continued progress in filling the new unit 14 art warehouse should contribute towards another satisfactory set of results in the second half.

    At PHFC, we can expect to see the normal slower trading in the quieter winter months on the Ferry. In the absence of profits from the one-off asset sales seen in the first half, the outlook for any further growth in profits remains challenging, without a slowing and eventual reversal in the rate of decline in ferry passenger numbers.

    In the Falklands, the combination of the austral summer and a seasonal boost from consumer spending at Christmas should underpin a traditionally solid second half’s trading. In the longer term there remains significant growth potential linked to oil and/or an accelerated development of land based tourism.

    With its strong balance sheet, and diverse portfolio of three profitable and well established, niche businesses the Group is well positioned on a sustainable footing and with its healthy cash reserves the board will continue its search for value enhancing acquisitions to further underpin shareholder value over the long term.

Operating Companies