Chemring Interim 2006 - Chemring Group PLC

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C H E M R I N G G R O U P P L CNotes to the Interim Statement- continued3. INSURANCE CLAIMThe Group is pursuing a claim against its former insurance brokers, concerning the insurance cover for Kilgore Flares Company LLCand the broker’s subsequent handling of a claim, following a manufacturing incident at Kilgore Flares Company LLC on18 April 2001.At 31 October 2005 a balance of £2,796,000 was recognised within other debtors. This outstanding balance has been reduced by£84,000, to £2,712,000 at 30 April 2006, as a result of exchange rate movement against the US dollar. All further legal andprofessional costs incurred in the half year to 30 April 2006 have been recognised in the income statement.4. TAXATIONThe estimated tax rate for the Group for the year ending 31 October 2006 is 33% (2005: 32%).5. EARNINGS PER SHAREEarnings per share are based on the average number of shares in issue of 29,990,590 (2005: 29,013,854) and profit on ordinaryactivities after taxation and minority interests of £7,803,000 (2005: £4,172,000). Diluted earnings per share has been calculatedusing a diluted average number of shares in issue of 30,233,031 (2005: 29,119,379) and profit on ordinary activities after taxationand minority interests of £7,803,000 (2005: £4,172,000).The earnings and shares used in the calculations are as follows:20062005OrdinaryOrdinaryBasicEarnings£0007,803sharesNumber000s29,991EPSPence26.02Earnings£0004,172sharesNumber000s29,014EPSPence14.38Additional shares issuable otherthan at fair value in respect ofoptions outstanding-242(0.21)-105(0.05)Diluted7,80330,23325.814,17229,11914.33Reconciliation from basic earnings per share to adjusted earnings per share:Adjusted earnings has been defined as earnings before amortisation of intangible assets arising on acquisition and the impact ofnon-cash settled share-based payments. The directors consider this measure of earnings allows a more meaningful comparison ofearnings trends.20062005OrdinaryOrdinaryBasicEarnings£0007,803sharesNumber000s29,991EPSPence26.02Earnings£0004,172sharesNumber000s29,014EPSPence14.38Amortisation of acquiredintangibles (after tax)224-0.75---IFRS 2 – non-cash settledshare-based payments (after tax)292-0.9769-0.24Adjusted8,31929,99127.744,24129,01414.62P 16
I N T E R I M R E P O R T 2 0 0 66. RECONCILIATION OF CHANGES IN EQUITYUnauditedHalf year to30 April 2006£000UnauditedHalf year to30 April 2005As restated£000UnauditedYear to31 Oct 2005As restated£000Profit on ordinary activities after taxation for the period/yearEquity minority interestDividends7,805(2)(2,130)4,178(6)(1,797)8,769(13)(2,730)Retained profit for the period/yearOther recognised gains/(losses)Ordinary shares issuedShare premium arisingNet addition to/(reduction from) shareholders’ funds5,67399815226,25033,0732,375(4,023)6230(1,412)6,026(2,659)105643,941Opening shareholders’ funds56,50152,56052,560Closing shareholders’ funds89,57451,14856,5017. ACQUISITIONSOn 30 November 2005 the Group acquired the entire share capital of Comet GmbH for a cash consideration of £6,600,000,subject to a working capital adjustment.On 1 February 2006 the Group acquired the entire share capital of Leafield Engineering Limited and Leafield Marine Limitedfor a combined cash consideration of £4,370,000, subject to a working capital adjustment and the assumption of £570,000 ofbank overdrafts.On 13 March 2006 the Group completed the acquisition of the entire capital stock of Technical Ordnance Inc. for a cashconsideration of $70,000,000 (approximately £40,500,000), subject to a working capital adjustment.A summary of the assets acquired and consideration paid in respect of these four acquisitions is set out below:£000Intangible assetsProperty, plant and equipmentWorking capitalCashDeferred taxGoodwillConsideration:CashCash payable in future periods6,0714,8927,0491,363(710)18,66536,28354,94853,0131,93554,948Cash payable in future periods relates to working capital adjustments and is payable within twelve months.P 17
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Page 27 and 28: Photographs:© Chemring Group PLC

Chemring Interim 2006 - Chemring Group PLC

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