The information contained within this announcement is deemed by the Company to constitute inside information pursuant to Article 7 of EU Regulation 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended. Upon the publication of this announcement via a Regulatory Information Service, this inside information is now considered to be in the public domain.

 

16 September 2024

 

Facilities by ADF plc

 

("Facilities by ADF", "ADF", the "Company" or the "Group")

 

Half year results for the six months ended 30 June 2024

                                                                                                                                                                           

Facilities by ADF, the leading provider of premium serviced production facilities to the UK film and high-end television industry ("HETV") announces its unaudited half year results for the six months ended 30 June 2024 (H1-FY24).

 

Financial highlights

 

£m	H1-FY24	H1-FY23	Change	H2-FY23	Change
Group revenue	15.2	21.8	(30%)	13.0	17%
Adjusted EBITDA*	2.5	5.8	(57%)	1.5	67%
Adjusted EBITDA %	17%	27%	(37%)	12%	42%
(Loss)/ profit Before Tax	(0.8)	2.7	(130%)	(2.1)	62%
(Loss)/ earnings per share - basic	(0.75) pence	3.2 pence	(124%)	(2.2) pence	66%
Interim dividend per share	0.5 pence	0.5 pence	-	0.9 pence	-

 

Operational highlights

 

·	Despite disruptions in the Film and HETV industry due to the Hollywood writers and actors strike (the "Strikes"), which ran from 2 May 2023 to 9 November 2023, the Group delivered a resilient performance as market conditions began to normalise with revenue up 17% to £15.2m from H2-FY23.
·	Continued successful integration of Location One Ltd into the Group leading to a significant increase in joint production activity, validating ADFs One-Stop-Shop approach.
·	ADF officially opened its flagship Longcross site with a ceremony for its customers, suppliers and investors, enabling the Group to deliver greater transport efficiencies for its customers and ongoing operational benefits to the business.
·	Supported 38 high-profile productions across H1-FY24 including Legacy, The Diplomat, Wolf Hall Season 2, Slow Horses, Silent Witness, The Witcher, Signal and Call the Midwife.

 

Post period end

 

·	Successfully completed the acquisition of Autotrak Portable Roadways ("Autotrak"), one of the UK's leading portable roadway suppliers, on 10 September, raising £10m from an oversubscribed placing and a further £0.5m from a retail offer.
·	The acquisition is a further step in delivering on ADF's strategy to be a One-Stop-Shop and endorses the Group's aspirations of generating £100m revenue in the medium term.

 

Outlook

 

·	The UK film and TV industry remains robust, with approximately £9.5bn expected to be invested in production over the next five years, driven by continued global demand.
·	ADF's established market position, high-quality vehicle fleet, and excellent customer service position the Group well for further growth and capturing market share.
·	Trading at the end of H1-FY24 finished strongly, with the order book for the second half of the year building well across the summer months as momentum returns across the market following the Strikes.
·	Continued to develop and progress a pipeline of other complimentary acquisitions to further support delivery of the Group's medium term growth aspirations.
·	Continued confidence in the Group's delivery of performance in the full year in line with market expectations.

 

Commenting, Marsden Proctor, CEO, said:

 

"We are proud of the performance delivered in H1-FY24, demonstrating the Group's resilience and leading market position as the Film and HETV industry continues to recover from the impact of last year's strike disruptions. With the market normalising, we continue to be well-positioned to achieve our goal of becoming a One-Stop-Shop, which is further strengthened by our strategic acquisition of Autotrak post-period end. This most recent acquisition allows us to bring further compelling and enhanced product and service offerings to all our customers; on behalf of the Board, I would like to thank both new and existing shareholders for their support in making this possible.

 

"As we continue to invest in our fleet and explore further acquisition opportunities, alongside the increased investment anticipated across the industry in the UK in the coming years, we remain confident in achieving our aim of generating £100m revenue in the medium-term."

 

 

*Adjusted EBITDA is the adjusted profit before tax, prior to the addition of finance income and deduction of depreciation, amortisation, and finance expenses. The adjusted EBITDA measurement removes non-recurring, irregular and one-time items that may distort EBITDA. Adjusted EBITDA provides a more normalised metric to make comparisons more meaningful across the Group and other companies in the same industry.

 

 

For further enquiries:

 

Facilities by ADF plc Marsden Proctor, Chief Executive Officer Neil Evans, Chief Financial Officer John Richards, Chairman	via Alma
Cavendish Capital Markets (Nomad and Broker) Ben Jeynes / George Lawson / Hamish Waller - Corporate Finance Michael Johnson / Sunila de Silva / George Budd - Sales / ECM	Tel: +44 (0)20 7397 8900
Alma Strategic Communications Josh Royston Hannah Campbell Robyn Fisher	Tel: +44 (0)20 3405 0205 facilitiesbyadf@almastrategic.com

 

OVERVIEW OF FACILITIES BY ADF PLC

 

The Facilities by ADF Group is the leading provider of premium serviced production facilities along with location services and ground protection equipment to the UK film and high-end television (HETV) industry.

 

The Group serves customers in an industry that has experienced significant growth in recent years, with additional demand driven by a material rise in the consumption of film and HETV content via streaming platforms such as Netflix, Disney+, Apple TV+ and Amazon Prime. The UK film and TV industry has directly benefited during this growth due to the quality of its production facilities and studios, highly skilled domestic workforce, geography, accessibility to Europe, English language environment and strong governmental support. Major US streaming companies have now set up permanent bases in the UK, with the UK now the film and TV industry's second largest operation after North America.

 

Facilities by ADF production fleet is made up of more than 700 premium mobile make-up, costume and artiste trailers, production offices, mobile bathrooms, diners, school rooms and technical vehicles.

 

To strengthen its position as a One-Stop-Shop for the Film and HETV industry, ADF acquired Location One Ltd, the UK's largest TV and film location service provider, in November 2022, and then further expanded in September 2024 by acquiring Autotrak Portable Roadways Ltd, a market leader in portable roadway solutions, diversifying the Group's offerings and customer base.

 

 

Chief Executive Officer's review

 

Overview

 

The Group delivered a good performance in H1-FY24 as the business ramps back up following the disruption to the film and HETV industry caused by the now resolved strike action in FY23. As market conditions normalise through H2-FY24, and regular business resumes, we are able to continue to execute on our goal of becoming a One-Stop-Shop, demonstrating the resilience of the Group.

 

Delivering against growth strategy

 

The Group has ambitions to continue to grow organically through further investment into its revenue-generating vehicle fleet, and also through appropriate acquisitions. We remain focused on improving our planning, sales and financial systems through a bespoke planning system (BMS) with our external IT partner ITCS, streamlining our booking system, and helping to ensure we can provide our customers with the very best level of customer service.

 

Acquisition of Autotrak Portable Roadways Limited

 

In September 2024, ADF acquired one of the UK's market-leading portable roadway suppliers, Autotrak, for a maximum consideration of £21.3 million. This acquisition marks a significant step in the Company's strategy to diversify its product offerings and expand its customer base beyond the film and HETV industry. We raised a £10.0 million by way of an oversubscribed placing to part-fund the acquisition. A further £0.5 million was also raised from an oversubscribed retail offer which has provided ADF with additional capital to continue to execute upon the Group's growth strategy. We are grateful to all new and existing shareholders that took part, enabling ADF to accelerate our growth plans and deliver for our shareholders. Autotrak is one of the largest suppliers of portable roadway panels to the film and TV industry in the UK. The temporary roadway market is experiencing substantial growth, driven by infrastructure projects, events, and industrial activity.

 

The initial consideration for the acquisition comprised £10.0 million payable in cash and the issue of 5,915,357 consideration shares. Contingent consideration deferred over three years from completion of an aggregate of up to £4.2 million is payable in cash in equal annual tranches contingent on maintenance of forecasted levels of adjusted EBITDA performance from FY 2025 to FY 2027. In addition, earnout consideration of up to £4 million in aggregate is payable in cash in FY28 based on growth in adjusted EBITDA performance from FY 2025 to FY 2027.

 

The acquisition is a further endorsement of ADF's aspirations of generating £100m revenue in the medium-term and it is anticipated to be significantly Earnings Per Share (EPS) accretive following Autotrak's full integration into the Group.

 

Autotrak is a well-managed business and will operate as a subsidiary of ADF, whilst sharing our industry contacts and streamlining our operational processes to ensure best practice is adopted across the Group.

 

ADF already enjoys an excellent working relationship with Autotrak whose customer base and strong financial metrics speak to the high quality of its offering and people behind it. I am pleased to report that joint customer conversations are already underway, with positive initial feedback from customers and prospects for our new Group. Alongside Location One, this acquisition will further enable us to provide the very best services the industry has to offer under one roof and moves us towards becoming a One-Stop-Shop to the UK film and HETV industry, as well as diversifying our customer base into the events industry.

 

The Group continues to have a strong pipeline of further potential complimentary acquisition opportunities, and these will remain under consideration in our ongoing discussions.

 

The market opportunity

 

Although the impact of the FY 2023 strikes on the film and HETV industry carried on into the start of FY 2024, with producers having to reorganise the schedules of all relevant parties, the underlying market drivers remain strong which underpin the long-term growth opportunities for the Group.

 

The UK continues to receive substantial investment with global production companies increasingly choosing the region's state of the art studios and facilities. Over the next five years, approximately £9.5 billion is expected to be invested in UK film and television in London alone (Film London). The BFI also recently reported UK film and HETV production spend for the quarter to June 2024 of £2.9 billion, a threefold increase from the £0.9 billion spend of the previous quarter. This trend is attributable to the gradual return to production following the US writers' and actors' strikes.

 

In its quarterly report to June 2024, Pinewood Studios also pointed to a recovery from the strikes. The studio, which owns Shepperton Studios, recorded £49 million in revenue for the quarter ended June 2024 a 38% annual increase on the prior year, driven by expanded studio space. Annual turnover reached £147 million, with adjusted EBITDA rising to £86 million.

 

Further studio expansion in the UK includes Amazon Prime/MGM which acquired Bray Studios, where "The Lord of the Rings: The Rings of Power" is filmed. The Berkshire site includes substantial sound stage, workshop, office, and backlot space. Disney also plans to invest $5 billion over the next five years in UK and European productions, following the success of recent films like "Inside Out 2" and "Deadpool & Wolverine."

 

Government support including tax incentives and funding for film and TV production in the UK also highlight the long-term opportunities in the industry and we expect the UK's new labour government to continue supporting this industry. The UK government has enhanced tax incentives for film and high-end TV productions, making the country an even more attractive location for streamers. Additionally, a 40% reduction in business rates for film studios through to 2034 is expected to support new developments, addressing concerns about a shortage of studio space. The UK will need an additional 2.6 million square feet of studio space by 2028 to meet industry demand.

 

Competitive strength

 

We remain the provider of choice for many in the UK for large scale and quality productions as evidenced by the Group's current order book. This position, has taken many years to establish, enabling high barriers to entry, and allowing us to benefit from high valued productions and customers. Our growth strategy means we have been able to implement the right infrastructure to support continued successful customer delivery and sustained strategic expansion.

 

To deliver such a high quality of service to our customers and successfully compete at this level, the quality, and more importantly compliance of a supplier's vehicle fleet needs meet the highest applicable standards. ADF prides itself upon the strength of its vehicle fleet and excellent customer service, which allows the Company to have positive and pro-active dialogue with its customers which include some of the world's largest traditional and on-demand production companies and positions us well to capture a growing proportion of the expanding market. With the addition of Location One's services, including waste and water management, power and lighting and fencing, we have become better equipped to support large scale productions. Now, with Autotrak part of the Group and providing complementary products and services, including ground protection and matting, to existing and new markets, the enlarged Group is better placed than ever, with the ability to deliver high volumes of equipment under one roof.

 

During H1-FY24, ADF was pleased to officially open its flagship Longcross site. The management team have been working extremely hard over the past year on this project, and to have finally realised our objective in securing the site with planning approval for further development, this is a significant achievement, and huge credit must be given to them. The five-acre site is close to the key intersection of the M25 and M3 which is ideally situated for servicing Longcross Studio (1.5 miles) along with all the major studios London, including Shepperton (7 miles), Pinewood (16 miles), Leavesden (26 miles) and Elstree (40 miles). Being based at Longcross has many advantages and enables us to deliver great transport efficiencies to the business and our customers and importantly helps reduce scope 3 carbon emissions.

 

We supported 38 high-profile productions across H1-FY24 including Legacy, The Diplomat, Wolf Hall Season 2, Slow Horses, Silent Witness, The Witcher, Signal and Call the Midwife. Our performance in the half, which was ahead of H2-FY23 levels, reflects the continued appetite for ADF's services to support large scale productions.

 

We report our Net Promotor Score (NPS), an internationally recognised customer service measurement. Throughout the period our score did not drop below 85 (82 in FY23), a figure which Bain & Company, the creators for NPS, has described as 'world class'. We continue to perform extremely well, reflecting the skills, knowledge and expertise of our staff that enables us to remain the market leader.

 

Sustainability

 

Our clients entertain the world, and our mission is to support them with unparalleled service delivered by our exceptional team, all while prioritising sustainability and responsibility. To achieve this, we launched our 'Eco Set' ESG strategy in FY23, focusing on four key areas: climate and net zero, innovative client solutions, growth through learning, and making ADF a great place to work. We believe this approach will pave the way for a future where excellence and sustainability go hand in hand.

 

In our commitment to reducing emissions, we aim to be certified as Carbon Neutral from 2024 onwards. We're aligning with science-based targets to achieve a 50% reduction in carbon emissions per head by 2030, with a goal of reaching Net Zero by 2050.

 

We recognise that access to the film industry has been challenging for people with disabilities, and we are working closely with our clients to improve accessibility through bespoke accessible trailers, in partnership with UHC (Underlying Health Condition) and TAP (TV Access Project). The film industry has historically also lacked diversity, and we are dedicated to creating inclusive opportunities at ADF for all individuals. To further this commitment, we recently launched an inclusivity-focused campaign, driven by colleagues passionate about fostering a more diverse environment.

 

Our newly integrated ESG approach is led by our Chairman, John Richards, with the Board overseeing progress and embedding the strategy across the business.

 

I am deeply grateful to the ADF and Location One teams for their contributions to this strategy and for their passion in making a difference through the services we offer.

 

Outlook

 

Whilst the effects of the strikes continued into the first half of the current financial year, the Group's adjusted EBITDA performance in H1-FY24 was significantly ahead of H2-FY23, evidencing the continued growth in demand for ADF's services. The underlying market drivers still provide high confidence that demand will continue to expand over the medium term, underpinning our aspirations to generate £100m of revenue in this timeframe. To do this, we will continue to grow organically through continued investment in our revenue-generating fleet and appropriate investment in our healthy acquisition pipeline, in line with our strategy and robust evaluation criteria.

 

Trading in H2-FY24 continues to improve and over the course of the period we expect market conditions will return to be more in line with pre-strike levels, providing us confidence in delivering results for FY24 in line with market expectations.

 

Marsden Proctor

Chief Executive Officer

Financial performance

 

Summary

 

The financial results for the six months ended 30 June 2024 reflect the ongoing recovery following the US strikes, the effects of which continued to be felt into the first half of 2024. Revenue in H1-FY2024 of £15.2 million was 17% ahead of H2-FY23 (£13.0 million), but down 30% when compared with H1-FY23 (£21.8m) which was a period largely unaffected by the strikes, and indeed a record period for the business following the addition of Location One Ltd.

 

Sales performance was in line with ADF's budget and forecast for H1-FY24. The order book for the second half of FY24 has developed well through the summer as momentum continues to build across the market.

 

Profit margins also improved in H1-24 when compared with H2-23 (16.7% EBITDA margin vs. 11.9% in H2-FY23) as we supported larger productions which were more geographically centred around the main London studios and other studios close to our operational hubs in Wales, Manchester and Glasgow making them more efficient from a transport and mobilisation perspective. We have also continued to limit our use of Agency HGV drivers, avoiding unnecessary block bookings and fully utilising ADF drivers, all of which has contributed to an improved EBITDA margin.

 

Nevertheless, overall direct labour costs did increase as a percentage of revenue (37% vs. 29% in H1-FY23) which was in part a result of the continued market competitiveness, with the effects of price discounting lingering well into the summer. In addition, following the increase in the National Living Wage in April 2024 we increased rates of pay, particularly with our Base staff, to ensure our basic pay is in excess of the National Living Wage.

 

More broadly, the senior management team continued to monitor costs closely through the period, as we limited non-essential expenses to bring Overheads in under budget. Overall, core overheads were 18.4% of revenue, up on H1-FY23 of 12.3%.

 

Net interest expense increased from £625K in H1-FY23 to £682K in H1-FY24. The increase is a result of additional HP interest from new HP leases to fund organic growth of our fleet. Interest rates on HP leases are not variable and fixed at the date the leases are taken out.

 

Location One continues to integrate into ADF's systems and processes with all expected efficiencies having been delivered through consolidation of IT, sales, CRM and reporting systems. The additional services within the Group, including waste and water management, power and lighting, and fencing, means we have become better equipped to support large scale productions. Furthermore, having one integrated platform for sales has led to successful joint bids for 29 productions in H1-FY24, up from nine in H1-FY23.

 

As a result of the above, the loss before tax for H1-FY24 was £0.8 million, (H1-FY23: profit of £2.7 million).

 

The taxation credit for H1-FY24 of £186k represents deferred tax only as the Group currently has excess (super deduction) capital allowances to cover its current taxable profits.

 

EBITDA

 

The Group measures performance based on EBITDA and Adjusted EBITDA. EBITDA is a common measure used by investors and analysts to evaluate the operating financial performance of companies. We consider EBITDA and Adjusted EBITDA to be useful measures of operating performance, EBITDA approximates the underlying operating cash flow by eliminating depreciation and amortisation. Adjusted EBITDA adds back any non-recurring or exceptional costs.

EBITDA and Adjusted EBITDA are not direct measures of our liquidity, which is shown by our cash flow statement, and need to be considered in the context of our financial commitments. Adjusted EBITDA for H1-FY24 was £2.5 million (16.72% EBITDA margin) compared to H1-FY23 at £5.77 million (26.5%).

A reconciliation of Adjusted EBITDA is shown below:

 

Adjusted EBITDA £000's	H1-FY24	H1-FY23	H2-FY23	FY-23
Revenue	15,186	21,777	13,019	34,796
Profit/ (loss) before tax	(796)	2,737	(2,122)	615
Add back:
Finance expenses	682	625	771	1,396
Depreciation	2,557	2,350	2,628	4,978
Amortisation	12	9	9	18
Non-recurring expenses	-	23	235	258
Share based payments	84	29	30	59
Adjusted EBITDA	2,539	5,773	1,551	7,324
Adjusted EBITDA %	16.7%	26.5%	11.9%	21.0%

 

Revenue

 

ADF's overall revenue increased by 17% in H1-FY24 to £15.2m when compared with H2-FY23 (£13.0m), as the market began to build momentum following resolution of the US strikes in November 2023.

The table below shows the revenue between the two main facilities hire categories, being main packages (pre-agreed before filming) and additional sales (during the course of filming), plus other miscellaneous sales. Revenue for Location One is shown separately.

 

Turnover £M's	H1-FY24	H1-FY23	% Change	H2-FY23	FY23
Facilities - Main packages	£7.5	£10.1	(26%)	£6.4	£16.5
Facilities - Additional sales	£4.0	£6.4	(37%)	£3.3	£9.7
Facilities - Other income	£0.1	£0.1	~100%	£0.1	£0.2
Facilities - Total	£11.6	£16.6	(30%)	£9.8	£26.4
Location Equipment hire (Location One)	£3.6	£5.2	(31%)	£3.2	£8.4
Total Revenue	£15.2	£21.8	(30%)	£13.0	£34.8
Uplift on main packages % (see explanation below)	54%	74%		52%	60%

 

The reduction in uplift in H1-FY24 vs. H1-FY23 is due to the impact of the strikes, having worked on productions with less equipment and of shorter duration as the market continued its recovery during the period.  

 

Main Package sales

 

Main packages are agreed with ADF's clients, in most cases several months in advance for the hire of specific items of equipment over a set timeframe. Each type of equipment has a set daily hire rate. The cost of ADF staff required to be onsite to manage and service the equipment is also calculated by reference to a set daily hire rate. The rate card is set and adjusted annually. Main packages are purely to secure and 'pre-book' the equipment and staff. These packages are split into equal fortnightly payments beginning two weeks before commencement of principal filming.

 

Additional sales

 

ADF's trailers and staff are typically booked six or more months in advance, and client requirements invariably change in the run up to and during filming. Often, at the time of booking, scripts have not been finalised and locations have not been agreed. Any additional equipment and staff required closer to and during the filming period, plus the labour & transport cost to move equipment, are then charged out weekly during the filming period. Additional sales include such items as:

·      Labour recharges - this is the largest component of additional revenue (typically more than half) and is principally payments for drivers to move trailers and equipment around the various locations on each production.

·      Additional trailer hire - incremental ad-hoc vehicles required during the project.

·      Fuel recharges - ADF recharges fuel used on productions (with a c.10% admin fee).

·      Sundry recharges - consumable products, hand sanitisers, toiletries etc

 

Revenue Mix

 

ADF worked on 38 productions in H1-FY24, the same number as in H2-FY23. However, there was a reduction in revenue per production in H1-FY24 to £304k, a 16% decrease when compared with H1-FY23 (£361k).

 

The BBC became the largest share of revenue in the period as the available work all gravitated to their shows, with streamers effectively offline during the strikes.

 

	H1-FY24		H1-FY23
Revenue by Platform	£000's	%	£000's	%
Amazon	£223	1.5%	£747	3.4%
Apple	£2,626	17.3%	£2,378	10.9%
BBC	£4,011	26.4%	£3,059	14.1%
Disney	£515	3.4%	£3,037	13.9%
Fox	£0	0%	£0	0%
ITV	£852	5.6%	£2,671	12.3%
Marvel	£0	0%	£0	0%
Netflix	£3,355	22.1%	£4,578	21.0%
Other Productions	£2,395	15.7%	£4,265	19.6%
Sky	£1,209	8.0%	£607	2.8%
Total invoiced	£15,186	100.0%	£21,342	98.0%
Cross Hire & Other	£0	0%	£435	2.0%
Total revenue	£15,186	100.0%	£21,777	100.0%

 

Split
ADF	£11,548	76%	£16,617	76%
Location One	£3,638	24%	£5,160	24%
	£15,186	100%	£21,777	100%
ADF Productions (No.)	38		46
ADF Ave Rev Per Production	£304		£361

 

The split of productions across the revenue bands is shown below:

 

Production value	H1-FY24	H1-FY23	FY23
£0 - £500k	31	37	72
£500k - £1.0m	5	4	7
£1.0m - £1.5m	1	2	3
£1.5m - £2.0m	0	2	1
£2.0m - £2.5m	1	0	1
£2.5m - £3.0m	0	1	0
	38	46	84

 

Share Based Payments & Non-Recurring Expenses

 

The share-based payments relate to certain options granted to the two current Executive Directors along with members of the Senior Management Team. The non-recurring expenses in the prior period relate to adjustments to the carrying value of goodwill and provisions for deferred consideration payments relating to the acquisition of Location One in 2022.

On 4 March 2024, the Company awarded a total of 1,001,225 options under its LTIP to Marsden Proctor (571,429 options) and Neil Evans (429,796 options). The awards are over ordinary shares of £0.01 in the form of options to acquire ordinary shares at nominal value.

The LTIP Awards will vest not earlier than the third anniversary of grant subject to meeting the performance conditions applied to the awards measured over the three-year period ending 31 December 2026. 50% of the award is subject to an EBITDA growth performance target and 50% is subject to a total shareholder return growth target with vesting commencing at 6% CAGR rising on a straight line to full vesting at 10% CAGR. The LTIP Awards are subject to a two-year post-vesting holding period.

Awards of a further 566,329 options were made to other senior employees on similar terms.

Dividend & EPS

 

Reflecting confidence in the Group's performance for the full year, the Board has declared an interim dividend of 0.5 pence per share in respect of the six months ended 30 June 2024 (the "Interim Dividend"). The Interim Dividend will be paid on 25 October 2024, with a record date of 4 October 2024 and an ex-dividend date of 3 October 2024.

 

The Interim Dividend, over an increased number of ordinary shares in issue following the successful placing approved by shareholders on 9 September 2024, is reflective of the Group's progressive dividend policy.

 

The Company declared a final dividend of 0.90 pence per share in April 2024 in relation to the year ended 31 December 2023. This took the total dividend for that year to 1.40 pence per share, with the interim dividend of 0.50 pence per share in October 2023.

 

Basic earnings per share for H1-FY24 was a loss of 0.75 pence per share compared with earnings of 3.20 pence per share in H1-FY23.

 

The Company paid a final dividend of 0.90 pence per share in June 2023 in relation to the year ended 31 December 2022. This took the total dividend for that year to 1.36 pence per share, with the interim dividend of 0.46 pence per share in October 2022. The Company also paid an interim dividend in October 2023 of 0.50 pence per share in relation to the year ended 31 December 2023. The dividend policy is progressive with growth in earnings. Basic earnings per share for FY23 was 0.99 pence per share, (FY22: 6.1 pence per share).

 

Cash Flow & Net Debt

 

During H1-FY24, ADF financed capex of £0.8 million by hire purchase, and the balance of £0.5 million was paid for out of the Company's own cash. The majority of the hire purchase funding was with two providers, PACCAR Finance, the in-house finance company for DAF vehicles, and HSBC. Interest rates have increased in line with the Bank of England base rate and averaged 6.9% across H1-FY24 (FY23: 7.5%). The interest rate being paid across all HP contracts averages 4% to 30 June 2024. Total hire purchase repayments including interest were £2.8 million. No new property leases were added in the period.

 

Net current liabilities increase to £3.9 million from £2.7 million at the 31 December 2023, largely due to the timing of HMRC liabilities and a slight increase in trade payables offset by a reduction in trade receivables.

 

Net debt, excluding IFRS 16 leases, at the end of June 2024 was £13.0 million (31 December 2023: £12.8 million) with hire purchase liabilities decreasing from £16.3 million at the end of FY23 to £14.7 million at the end June 2024, and cash reducing from £3.5 million to £1.7 million. During the period a dividend of £0.7 million was paid, being the only other significant cash flow item.

 

FACILITIES BY ADF PLC

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 JUNE 2024

	Note		Six months ended 30 June 2024 (unaudited) £'000		Six months ended 30 June 2023 (unaudited) £'000
Revenue	3		15,186		21,777
Cost of sales	4		(9,825)		(13,332)
Gross profit			5,361		8,445
Administrative expenses			(5,391)		(5,031)
Non-recurring expenses	5		-		(23)
Share based payment expense	11		(84)		(29)
Operating (loss)/ profit			(114)		3,362
Finance expense	8		(682)		(625)
(Loss)/ profit before taxation			(796)		2,737
Taxation			186		(192)
(Loss)/ profit for the period			(610)		2,545
Earnings per share for (loss)/ profit attributable to the owners
Basic (loss)/ earnings per share (£)	6		(0.0075)		0.0320
Diluted (loss)/ earnings per share (£)	6		(0.0075)		0.0298

 

 

 

FACILITIES BY ADF PLC

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 30 JUNE 2024

	Note		As at 30 June 2024 (unaudited) £'000			As at 31 December 2023 (audited) £'000
Assets
Current assets
Inventories			585			576
Trade and other receivables			3,127			1,710
Cash and cash equivalents			1,681			3,533
Total current assets			5,393			5,819
Non-current assets
Property, plant and equipment	7		12,300			12,638
Right-of-use assets	8		30,480			31,527
Intangible assets	9		6,287			6,262
Total non-current assets			49,067			50,427
Total assets			54,460			56,246
Liabilities
Current liabilities
Trade and other payables			4,528			2,941
Lease liabilities	8		4,847			5,624
Total current liabilities			9,375			8,565
Non-current liabilities
Other provisions			41			40
Lease liabilities	8		18,427			19,584
Contingent consideration			60			60
Deferred tax liabilities			2,844			3,030
Total non-current liabilities			21,372			22,714
Total liabilities			30,747			31,279
Net Assets			23,713			24,967
Equity
Called up share capital	11		809			809
Share premium			15,547			15,547
Share based payment reserve	11		1,543			1,459
Merger reserve			(400)			(400)
Retained earnings			6,214			7,552
Total equity			23,713			24,967

 

 

 

 

FACILITIES BY ADF PLC

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 30 JUNE 2024

 

	Note	Share Capital £'000	Share Premium £'000	Share Based Payment Reserve £'000	Merger Reserve £'000	Retained Earnings £'000	Total Equity £'000
Balance at 01 January 2023		794	15,492	1,652	(400)	7,879	25,417
Comprehensive Income
Profit for the year		-	-	-	-	794	794
Transactions with owners
Exercise of options	11	15	55	(252)	-	252	70
Share based payment charge on long term incentive program	11	-	-	59	-	-	59
Deferred tax on share options		-	-	-	-	(243)	(243)
Dividends		-	-	-	-	(1,130)	(1,130)
Balance at 31 December 2023 (audited)		809	15,547	1,459	(400)	7,552	24,967
Balance at 01 January 2024		809	15,547	1,459	(400)	7,552	24,967
Comprehensive Income
Loss for the period		-	-	-	-	(610)	(610)
Transactions with owners
Share based payment charge on long term incentive program	11	-	-	84	-	-	84
Dividends		-	-	-	-	(728)	(728)
Balance at 30 June 2024 (unaudited)		809	15,547	1,543	(400)	6,214	23,713

 

 

 

 

 

FACILITIES BY ADF PLC

UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 JUNE 2024

	Note		Six months ended 30 June 2024 (unaudited) £'000		Year ended 31 December 2023 (audited) £'000
Cash flows from operating activities
(Loss)/ profit before taxation from continuing activities			(796)		615
Adjustments for non-cash/non-operating items:
Depreciation of property, plant and equipment	7		941		1,751
Amortisation of right-of-use assets	8		1,617		3,227
Amortisation of intangible assets	9		12		18
Impairment of goodwill	9		-		1,019
Profit on disposal of property, plant and equipment	7		(85)		(84)
Loss on disposal of right of use assets	8		113		75
Share based payment charge	11		84		59
Fair value gain on deferred consideration			-		(818)
Finance expense	8		682		1,396
			2,568		7,258
Increase in inventories			(9)		(159)
(Increase)/ decrease in trade and other receivables			(1,417)		1,335
Increase/ (increase) in trade and other payables			1,587		(3,381)
Cash from operations			2,729		5,053
Net cash generated from operating activities			2,729		5,053
Cash flows from investing activities
Purchase of property, plant and equipment	7		(516)		(4,437)
Purchase of intangible assets	9		(37)		(10)
Purchase of right-of-use assets1	8		(132)		(90)
Proceeds from sale of property, plant and equipment			180		434
Net cash used in investing activities			(505)		(4,103)
Cash flows from financing activities
Proceeds from issue of shares			-		70
Cash movements on lease liabilities	8		(2,666)		(4,479)
Interest paid on lease liabilities	8		(682)		(1,335)
Interest on deferred consideration			-		(57)
Other interest paid			-		(4)
Dividends paid			(728)		(1,130)
Net cash used in financing activities			(4,076)		(6,935)
Net decrease in cash and cash equivalents			(1,852)		(5,985)
Cash and cash equivalents at beginning of period			3,533		9,518
Cash and cash equivalents at end of period			1,681		3,533

¹The purchase of right-of-use assets relates to cash additions made to improve assets held on hire purchase, included in right -of-use assets as detailed in note 8.