London Security : Financial Reporting Document

London Security plc

Unaudited Interim Statement for the six months ended 30 June 2021

A leader

in Europe's fire security industry.

Chairman's statement

J.G. Murray, Chairman

FINANCIAL HIGHLIGHTS

• Revenue £82.7m (2020: £67.2m)
• Operating profit £12.3m (2020: £7.6m)
• Earnings per share 75.6p (2020: 39.9p)

Trading

The financial highlights illustrate that the Group's revenue increased by £15.5 million (23.1%) to £82.7 million.

Operating profit increased by £4.7 million (61.8%) to £12.3 million.

The period under review reflects the impact from the coronavirus outbreak, which significantly impacted all the countries in which we operate in quarter one and quarter two of 2020. In 2021 there has largely been a return to normality in our business although some customers remain closed and there are still some restrictions on our operations to help reduce transmission. We must be prepared for further disruption should further waves materialise in any of the countries in which we operate.

Acquisitions

In the six months to the end of June, the Group has made four acquisitions. It remains a principal aim of the Group to grow through acquisition. Acquisitions are being sought throughout Europe and the Group will invest at the upper end of the price spectrum where an adequate return is envisaged by the Board.

Cash and financing

The Group's cash balance as at 30 June 2021 was £43.7 million. This is an increase of £6.2 million on the 31 December 2020 balance of £37.5 million.

In May 2018 the Group entered into a five year multi-currency facility until 2023 comprising £3.15 million and €8.40 million. To limit our exposure to increasing interest rates these loans are subject to interest rate caps of 1.5% LIBOR on the Sterling loan and 0.25% EURIBOR on the Euro loan.

Prospects

As the situation continues, cash management will be a key consideration; the London Security Group has a healthy balance sheet, strong cash reserves and a track record for good cash generation. The Board therefore considers that with its strong balance sheet and material net cash position the Group is well placed to prosper from the rebound in the economy as the vaccine programmes gain momentum in 2021.

Dividends

A final dividend in respect of 2020 of £0.40 per ordinary share was paid to shareholders on 9 July 2021.

J.G. Murray

Chairman

27 September 2021

01 London Security plc - Unaudited Interim Statement for the six months ended 30 June 2021

Consolidated income statement

for the six months ended 30 June 2021

			Unaudited	Unaudited	Audited
			six months	six months	year
			ended	ended	ended
			30 June	30 June	31 December
			2021	2020	2020
		Note	£'000	£'000	£'000
Revenue		82,739	67,164	152,723
	Cost of sales		(21,601)	(16,452)	(37,387)
	Gross profit		61,138	50,712	115,336
	Distribution costs		(30,188)	(26,310)	(56,281)
	Administrative expenses		(18,670)	(16,768)	(34,355)
	Operating profit		12,280	7,634	24,700
	EBITDA*		16,799	11,951	33,547
	Depreciation and amortisation		(4,519)	(4,317)	(8,847)
	Operating profit		12,280	7,634	24,700
	Finance income		21	21	78
	Finance costs		(99)	(96)	(201)
	Finance costs - net		(78)	(75)	(123)
	Profit before income tax		12,202	7,559	24,577
	Income tax expense		(2,862)	(2,602)	(6,536)
	Profit for the period		9,340	4,957	18,041
	Profit is attributable to:
	Equity shareholders of the Company		9,267	4,895	17,853
	Non-controlling interest		73	62	188
			9,340	4,957	18,041
	Earnings per share
	Basic and diluted	3	75.6p	39.9p	145.6p
	Dividends
	Dividends paid per share		Nil	Nil	60.0p

* Earnings before interest, taxation, depreciation, amortisation and impairment charges. The above are all as a result of continuing operations.

Unaudited Interim Statement for the six months ended 30 June 2021 - London Security plc

02

Consolidated statement of comprehensive income

for the six months ended 30 June 2021

	Unaudited	Unaudited	Audited
	six months	six months	year
	ended	ended	ended
	30 June	30 June	31 December
	2021	2020	2020
	£'000	£'000	£'000
Profit for the financial period	9,340	4,957	18,041
Other comprehensive income/(expense):
Items that will not be reclassified subsequently to profit or loss:
- currency translation differences on foreign operation consolidation, net of tax	(2,679)	3,196	2,396
- actuarial gain recognised in the Nu-Swift pension scheme	-	-	(4,554)
- movement on deferred tax relating to the Nu-Swift pension scheme	-	-	1,594
- actuarial loss recognised in the Ansul pension scheme	-	-	(17)
- movement on deferred tax relating to the Ansul pension scheme	-	-	5
Other comprehensive income for the period, net of tax	(2,679)	3,196	(576)
Total comprehensive income for the period	6,661	8,153	17,653

03 London Security plc - Unaudited Interim Statement for the six months ended 30 June 2021

Consolidated statement of changes in equity

for the six months ended 30 June 2021

	Share	Share	Capital	Merger	Other	Retained	Non-controlling
	capital	premium	redemption	reserve	reserve	earnings	interest	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
At 1 January 2020	123	344	1	2,033	6,442	106,882	349	116,174
Comprehensive income for the period:
- profit for the period	-	-	-	-	-	4,895	62	4,957
- exchange adjustments	-	-	-	-	3,196	-	-	3,196
Total comprehensive income for the period	-	-	-	-	3,196	4,895	62	8,153
Distribution to non-controlling interest	-	-	-	-	-	-	(159)	(159)
At 30 June 2020	123	344	1	2,033	9,638	111,777	252	124,168
Comprehensive income for the period:
- profit for the period	-	-	-	-	-	12,958	126	13,084
- exchange adjustments	-	-	-	-	(800)	-	-	(800)
- actuarial loss on pension schemes	-	-	-	-	-	(4,571)	-	(4,571)
- movement on deferred tax relating to
pension schemes	-	-	-	-	-	1,599	-	1,599
Total comprehensive income for the period	-	-	-	-	(800)	9,986	126	9,312
Contributions by and distributions to
owners of the Company:
- dividends	-	-	-	-	-	(7,356)	-	(7,356)
Distribution to non-controlling interest	-	-	-	-	-	-	(1)	(1)
At 31 December 2020	123	344	1	2,033	8,838	114,407	377	126,123
Comprehensive income for the period:
- profit for the period	-	-	-	-	-	9,267	73	9,340
- exchange adjustments	-	-	-	-	(2,679)	-	-	(2,679)
Total comprehensive income for the period	-	-	-	-	(2,679)	9,267	73	6,661
Distribution to non-controlling interest	-	-	-	-	-	-	(28)	(28)
Reduction in non-controlling interest	-	-	-	-	-	(123)	(103)	(226)
At 30 June 2021	123	344	1	2,033	6,159	123,551	319	132,530

Unaudited Interim Statement for the six months ended 30 June 2021 - London Security plc

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