SPRUE AEGIS PLC: Audited Final Results for the Year Ended 31Dec 2013

SPRUE AEGIS PLC: Audited Final Results for the Year Ended 31Dec 2013
14 April 2014 


                                Sprue Aegis plc                                
                    ("Sprue", the "Company" or the "Group")                    
           AUDITED FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2013           

Sprue designs and sells innovative smoke and carbon monoxide ("CO") alarms and
other safety related products and accessories and is one of Europe's largest
suppliers of such, selling products under its own distinct brands of FireAngel,
AngelEye and Pace Sensors based on its own in-house technology. Sprue is also
the exclusive European distributor of the brands of BRK Brands Europe Limited
("BRK Brands") namely First Alert, BRK and Dicon. Sprue is pleased to announce
its final results for the year ended 31 December 2013.

Financial highlights
  * Record year with turnover up 28% to £48.4m (2012: £37.8m)
  * Record operating profit (pre-exceptional)* up 64% to £5.3m; reported


operating profit of £4.9m (2012: operating profit £3.2m)
  * Basic EPS (pre-exceptional)* up 83% to 11.87 pence per share (2012: 6.50 
pence per share); reported basic EPS up 67% to 10.85 pence per share (2012: 
6.50 pence per share)
  * Recommended final dividend increased by 50% to 6 pence per share (2012: 4 
pence)
  * As expected, gross margin (before the £4.2m BRK Brands distribution fee 
(2012: £4.2m)) declined slightly to 37.2% (2012: 39.7%) principally due to 
a change in sales mix
  * Benefit of operational leverage coming through in 2.4% increase in net 
operating margin to (pre-exceptional)* 11.1% (2012: 8.7%)
  * Effective cash tax rate reduced from 17.2% to 10.3% following introduction 
of Patent Box
  * Increased investment in product development and capex at £1.4m (2014: £ 
1.0m)
  * Balance sheet remains strong with net cash of £5.2m (2012: £6.2m) and no 
debt 


    * Exceptional bid-defence costs of £0.4m incurred in the year

Operational highlights
  * Signed extension to the 2010 BRK Brands distribution agreement to take
    effect from 1 April 2015 securing Sprue's exclusive European distribution
    rights over the products and brands of BRK Brands on improved terms until


at least 31 March 2018
  * Continental Europe and UK Retail both performed very strongly
  * Successful inclusion on all frameworks that have replaced the Firebuy 
framework agreement to supply UK Fire & Rescue Services ("UK F&RS")
  * Nano-905, our miniature CO sensor now in manufacture and expected to be 
fitted in finished CO alarms to be sold in 2014, subject to approval from 
the relevant certification bodies
  * CO sensor volumes at Pace Sensors have significantly increased compared to 
2012
  * Successful defence of hostile bid by BRK Brands at 90p per Sprue share; BRK 
Brands secured acceptances of just 1.26% and withdrew its offer on 24 May 
2013
  * North American "UL" (Underwriting Laboratories) component recognition 
secured on Nano-905 and Sprue's Gen 1 CO sensor for use in ten-year sealed 
for life products
  * Subsequent to the year end, distribution agreements were signed with key 
distribution partners in Germany and France
  * Subsequent to the year end, appointment of a new third party smoke alarm 
assembler in China to increase supply chain capacity ahead of the expected 
uplift in sales in the French market
  * Announced separately today that Sprue has served notice to transfer its 


    listing from ISDX to AIM and, subject to admission to AIM becoming
    effective, is seeking to raise approximately £8.0 million by way of a
    placing of new ordinary shares with institutional and other investors
    Graham Whitworth, Chairman & Group CEO, commented:

"Despite the distractions of the hostile BRK Brands bid in early 2013, we are
delighted to report record sales, record operating profit, record basic EPS up
83%* to 11.87 pence per share and a 50% increase in the recommended final
dividend of 6 pence per share. The expansion of our business in Continental
Europe and the benefits of the multi-year contracts signed in 2012 are clearly
evident in our results and the business is well placed for further growth.

In March 2014, we were extremely pleased to announce the extension to our
exclusive right to distribute the brands and products of BRK Brands throughout
Europe - on improved terms - for at least a further three years from 1 April
2015 which reinforces the positive relationship we enjoy with Jarden
Corporation. This agreement consolidates Sprue's position at the forefront of
the European home safety products market. The reduction in the distribution fee
from £4.2m to £3.5m, £3.0m and £2.9m in each of the respective three years 
to
31 December 2017 more closely reflects the potential economic benefit Sprue
anticipates from the sale of BRK Brands' products.

Nano-905, Sprue's miniaturised version of its Gen 1 CO sensor made at Pace
Sensors in Canada is in full-scale production and is expected to be fitted in
finished CO detectors for sale in 2014, subject to approval from the relevant
certification bodies. The advancement of the new CO sensor over the current
design demonstrates the high level of intellectual property in the business.

With further major new products to be launched in 2014 and beyond - including
the ability to connect Sprue's wireless home safety products over the internet
- our competitive offering is set to significantly strengthen. Our new product
offering for the UK Trade sector will use adapted Thermoptek technology and
will be launched this year, subject to approval from the relevant certification
bodies. With a strengthened product line up, we expect to grow our UK Trade
market share over time.

We are also pleased to announce separately today that we have served notice to
transfer the Company's listing from ISDX to AIM. This is an exciting time in
the development of the Company and the move to AIM is expected to broaden the
shareholder base and improve the liquidity of Sprue shares.

Subject to admission to AIM becoming effective, the Board is pleased to
announce that Sprue is seeking to raise approximately £8.0 million by way of a
placing of new ordinary shares with institutional and other investors. The
placing proceeds will be used to provide additional working capital to support
sales growth across Sprue's markets, particularly in France, and to fund
product development.

Sprue remains well placed to deliver shareholder value and continue to grow
profitably. Thank you to all our employees for their contribution to make the
business successful during what has been another extremely busy year for the
business."

*Pre bid defence costs of £0.4m

For further information, please contact:

Sprue Aegis plc                                 02476 323 232                  
Graham Whitworth, Chairman & Group CEO                                         
John Gahan, Group Finance Director                                             


                                                                           
Westhouse Securities Limited                    020 7601 6100                  
Tom Griffiths                                                                  
Paul Gillam                                                                     
Notes to Editors 
About Sprue Aegis plc
Sprue is one of the market leaders in the European home safety products market.
Its principal products are smoke alarms and CO alarms and accessories and the
Company has an extensive portfolio of patented intellectual property. The
introduction of new safety products legislation in Europe, and increasing
levels of awareness of the dangers of smoke and CO, continue to drive sales. 
Sprue manufactures CO sensors at its subsidiary, Pace Sensors for use in all
its CO alarms. Other than CO sensors, the Company has no manufacturing and
instead outsources assembly and manufacturing to third party contract
manufacturers in China. 
Sprue enjoys a leading footprint in UK Retail and the UK's Fire and Rescue
Services. The Company also supplies the UK's Utility and Leisure sector which
includes customers such as British Gas and Scottish Gas and has a
well-established but relatively low market share of the UK Trade sector. Sprue
has a rapidly growing business in Continental Europe mainly selling through a
network of independently owned third party distributors. 
Sprue will be launching a gateway device later this year which will enable
connection and monitoring of its existing Wi-Safe2 products over the internet. 
The Company has won five prestigious Sunday Times Fast Track 100 Awards, which
recognises the 100 fastest growing companies in the UK. 
Sprue's head office is in Coventry and it uses a third party logistics /
warehouse provider in Cambridge for its own brand products. As part of the 2010
BRK distribution deal, Sprue took over the BRK Brands' Gloucester office and
BRK Brands' warehouse, also in Gloucester. 
Patented technology
Sprue has patented its technology in Europe, the US and other selected
territories. For further product information, please visit: www.sprue.com or
www.fireangel.co.uk or www.pacesensors.co.uk or www.firstalert.co.uk or
www.brk.co.uk. 
Company ethos
Sprue makes products that save lives. It is a simple philosophy. We design and
sell market-leading smoke and CO alarms that achieve this objective. 
Sprue is serious about CO and smoke detection and believes everyone should be
properly protected with affordable and reliable home safety products from a
company with brands you can trust. 
Our people work with passion and enjoy being part of a business that designs
and sells products that save lives. We encourage our staff to "make a
difference" to our business every day. 
OUR BRANDS
Sold under six complementary brands, Sprue's range of products is
comprehensive, allowing the Company to tailor the range of smoke alarms, CO
alarms and associated accessories it offers to suit the needs of each customer
across its target market segments. 
FireAngel
A market-leading and innovative battery operated alarms principally targeted at
UK Retail and UK F&RS customers. 
AngelEye
Launched in 2012 to sell, market and distribute Sprue engineered smoke alarms
and CO detectors principally into the French market. AngelEye has become a
leading brand targeted at the DIY channel in France, which the Directors
believe represents approximately 90% of the French market by value. 
Pace Sensors
CO sensors used within Sprue's CO products are developed by Sprue and Pace
Sensors, Sprue's wholly owned subsidiary in Canada. Pace Sensors' CO sensors
are used within all FireAngel, AngelEye and Pace Sensors CO detectors and
certain First Alert branded CO detectors. 
First Alert
With over 40 years' experience in manufacturing safety products, First Alert is
a known global brand in home safety, selling approximately 14 million smoke
alarms annually worldwide. First Alert is a BRK Brands brand and its range also
includes ancillary safety products, including fire extinguishers, fire blankets
and fire safes. First Alert is marketed as a `heritage' brand due to its
long-term presence in the fire safety market. 
BRK
Targeted at wholesalers, specifiers and electrical installation professionals,
BRK offers a comprehensive range of 230V mains powered smoke, heat and CO
alarms. 
Dicon
A BRK brand targeted at customers focused on value. 
                         MANAGEMENT COMMENTARY                              
Introduction
Sprue is building market leading positions in each of the five home safety
products markets that it serves by providing innovative, technologically
advanced, cost competitive smoke and CO products and accessories sold under
distinctive brands into each of these markets. Continuous investment in product
development such as our proprietary wireless technology, CO sensing know-how,
and our ability, due to launch later this year, to wirelessly connect to
products over the internet using a gateway device are helping to position the
Group as Europe's leading home safety products supplier. 
Financial review
Revenue increased by 28% to £48.4m (2012: £37.8m) reflecting the increase in
sales of FireAngel products into Germany, the expansion of the UK Retail
business and the benefit of the new multi-year contracts secured in 2012. As
anticipated, UK F&RS sales declined slightly due to budget cuts at the Brigades
introduced by the UK Government. 
As expected, gross margin before the annual BRK Brands' distribution fee of £
4.2m declined from 39.7% in 2012 to 37.2% principally due to changes in sales
mix. 
Operating profit (pre-exceptional)* increased by 64% to £5.3m (reported
operating profit: £4.9m) reflecting the strong operational leverage in the
business. The Group's outsourced manufacturing and assembly model remains
highly scalable and administrative costs (pre-exceptional)* as a percentage of
sales were significantly reduced to 16.5% (2012: 18.5%). 
In October 2012, Sprue repaid the outstanding £0.5m loan note and throughout
2013, the business was debt free which accounts for the reduction in interest
payable in the year compared to 2012. The balance sheet at the year end
remained strong with £5.2m of cash and no debt. 
The 2013 tax charge benefited from the introduction of "Patent Box" in April
2013 which allows the Group to effectively pay a reduced rate of corporation
tax on profits generated from products which contain components / designs that
relate to UK patents. Excluding the impact of deferred tax on timing
differences which are expected to reverse in the short term, the effective cash
tax rate in 2013 reduced compared to 2012 at 10.3% down from 17.2%. Relief
under Patent Box is extended from 60% to 70% from 1 April 2014 which is
expected to further reduce the effective cash tax rate for the Group and
thereby improve cash flow. 
Basic EPS (pre-exceptional)* increased 83% to 11.87 pence per ordinary share
(2012: 6.50 pence per share); reported basic EPS: 10.85 pence per share (2012:
6.50 pence per share). 
Compared to 2012, cash declined by £1.0m to £5.2m following a net working
capital increase of £3.2m, of which stock accounted for £2.3m, debtors £0.7m
and a reduction in creditors of £0.2m. We expect cash generation to gradually
improve as inventory levels normalise and the impact of improved credit terms
from our CO detector supplier take effect. However further growth in sales will
require additional working capital as the 2013 results have borne out. 
* Exceptional bid-defence costs of £0.4m incurred in the year 
The BRK Brands bid for Sprue
We thank all those shareholders who supported the management team and rejected
the BRK Brands bid at 90 pence per Sprue share. After taking advice, the
Independent Directors (which excluded Tom Russo and Ashley Silverton) concluded
that the offer price of 90p per share fundamentally undervalued the Company and
therefore unanimously rejected the bid and urged shareholders to do the same. 
BRK Brands and Sprue continue to co-operate on a day to day basis as supplier/
distributor and Sprue remains the exclusive distributor of BRK Brands' brands
in Europe. 
Extension of exclusive European distribution agreement with BRK Brands and
Jarden Corporation ("Jarden") 
On 21 March 2014, Sprue announced that it had entered into a three year
extension to its existing exclusive distribution agreement with BRK Brands and
Jarden. The extension, which is on improved terms, comes into effect from 1
April 2015, when the existing distribution agreement expires. 
Under the terms of the new agreement, Sprue has retained the exclusive rights
to distribute the products and brands of BRK Brands, namely, First Alert, BRK
and Dicon, throughout Europe. The key terms of the agreement are as follows:
  * Annual distribution fee (£4.2m payable currently) to be reduced to £3.5m, 
£ 
3.0m and £2.9m in calendar years 2015, 2016 and 2017 respectively; and
  * Minimum term of three years to 31 March 2018 with twelve months' notice 


    required by either party to terminate the agreement. Unless terminated, the
    agreement automatically renews on the same terms for further periods of
    twelve months.


As part of the negotiations, Sprue has also secured improved manufacturing
terms from Detector Technologies Limited, a Jarden company, which supplies
Sprue's branded smoke alarms and other associated accessories:
  * Improved credit terms equivalent to two months' purchases;
  * Right to source products at a fixed GBP / USD exchange rate of US$1.62 : £ 
1, removing foreign exchange rate risk on these purchases which are 
currently in USD; and
  * Fixed product prices for two years from 1 January 2014. 
Market update
Continental Europe. Sales were up 71% on 2012, largely due to a strong
performance in Germany where sales of FireAngel ST-620 (which scored joint top
in Stiftung Warentest, a consumer products testing association in February
2013), FireAngel ST-630 and FireAngel WST-630 (including the Wi-Safe 2 module)
where all models offer diagnostics capability with sealed for life 10 year
batteries, sold well. We believe that these products are now well established
in the German market. 
New legislation in Germany is continuing to drive sales where for example, in
Baden-Württemberg (the third largest state with 10.7m inhabitants), 
legislation
will require a smoke alarm to be fitted in all domestic homes by December 2014.
The bulk of sales in this market are through professional contractors where
Sprue and its German distributor have established contacts and where the
diagnostic capability of Sprue's products is proving highly appealing to German
customers. 
Shortly, the original ten-year products sold into Germany in 2007 are due to be
replaced and the replacement cycle that we have seen in Britain will commence
in Germany, which we expect to further drive sales. In addition, Berlin
(population: 3.3m), Brandenburg (population: 2.5m) and Sachsen (population:
4m), are yet to enact smoke alarm legislation which is expected to provide
additional growth in sales in the near future. 
In France, we have introduced AngelEye as the brand of choice for the DIY
channel which we believe represents over 90% of the French market by value.
Sales into France are in line with our internal expectations and are expected
to significantly increase as we approach the 8 March 2015 deadline to fit at
least one smoke alarm in each domestic property. We estimate that France has
around 25 million homes and this market offers significant growth potential for
the foreseeable future. For example, trials in 50 stores with a major French
customer which is a subsidiary of Kingfisher Group are now underway. This
represents a new potential customer in the French market. 
In 2013, sales of Sprue's branded products in Continental Europe increased 3.5
times and approximately two-thirds of sales into this sector were of Sprue's
branded products. This ratio is set to increase further as Sprue introduces
AngelEye and FireAngel products into the French and Benelux markets. 
We continue to receive enquiries from countries in Eastern Europe and parts of
Scandinavia for products which are likely to generate further incremental
FireAngel branded business. 
UK Retail. Performed very strongly with a 24% increase in sales compared to
2012. Sprue's branded product sales increased by 52%, mainly due to growth in
sales of CO products which all contain Sprue's CO sensor. Sales to B&Q,
Screwfix, Tesco and Amazon, all of whom have an online presence are progressing
well. Retail sector sales have benefitted from greater awareness of the danger
of smoke and CO with widely publicised safety campaigns led by the UK
Government, the Chief Fire Officers Association and Gas Safety charities. 
Utilities & Leisure ("U&L"). Sales into the Utilities & Leisure sector
increased 55% on 2012 largely due to CO products sold to British Gas and
Scottish Gas under contract. Sales to Baxi of the "noCO flues in voids CO
solution", which include a control unit that will cut off the electrical supply
to the boiler thereby shutting the boiler down when CO is detected, were slower
than expected but still represented accretive sales in 2013. Baxi products
using Sprue's technology are branded noCO (Baxi's own brand) and sales are
expected to gradually gain momentum as market awareness of the product
improves. 
UK F&RS. As expected, following the UK Government's budget cuts, sales to the
UK F&RS declined by 18% compared to 2012. In 2013, Sprue was successfully
appointed on all the frameworks that replaced the Firebuy framework agreement
which expired in H2 2012 and sales to Sprue's UK F&RS customers continue as
before. Virtually all product sales in this sector were of Sprue's branded
products. 
UK Trade. Overall, while UK Trade sales decreased by 7% compared to 2012,
FireAngel product sales including CO alarms, were maintained broadly at the
same level. Our new range of Trade products is on track to be launched in the
second half of the year and will replace much of the BRK trade range, providing
enhanced functionality and significantly improved performance. 
In October 2013, it became law in Scotland for all homes to be fitted with a CO
alarm where a new or replacement fixed combustion appliance is installed. We
expect this will drive sales and increase pressure for similar legislation in
other parts of the UK. 
Product development and product innovation
Nano-905. The Nano-905 sensor is expected to be included in finished CO alarms
manufactured in 2014. Sprue has spent a total of approximately £1.0m over the
last three years to miniaturise its existing Gen 1 CO sensor and has invested a
further £0.1m in capex to introduce a second production line at its Pace
Sensors facility in Canada to enable the production of the Gen 1 CO and the
Nano-905 CO sensor on separate dedicated assembly lines. The original Gen 1 CO
sensor will continue to be used in ten-year CO variants which are due to be
introduced shortly. 
Pace Sensors enjoyed a significant increase in production volumes compared to
2012. 
Development of AC powered alarms for the UK Trade market. Sprue is on track to
launch a new AC range of products in 2014 with a modern design which will
dramatically improve Sprue's product offering in the sector. 
Except for one AC powered product sold to B&Q in recent years, most of Sprue's
sales have been of battery powered alarms, so this represents an important step
forward for the Company, with the expansion of its Thermoptek technology into
AC powered products for the first time. From a very low base, Sprue expects to
gain market share gradually once its products become established. Sprue will
continue to sell its battery operated CO alarms into this sector under the
FireAngel brand and sales are progressing well.
Wi-safe 2 technology. Our market-leading FireAngel WST-630 Thermoptek smoke
alarm incorporates our ten-year battery life Wi-safe 2 technology and allows up
to 50 alarms to be meshed in a single wireless network. In addition, Sprue's
low frequency sounder and vibrating pad and strobe can connect to any Wi-Safe 2
enabled alarm. 
UL approval on Pace Sensors Gen 1 CO sensor. Sprue has secured North American
UL component recognition on its Gen 1 CO sensor to sell that component in
products in North America. The Gen 1 CO sensor could be incorporated into
ten-year sealed for life CO alarms. Entry into North America would
significantly increase Sprue's addressable market and continues to be under
review. 
Launch of FireAngel ST-622. Sprue has updated its ST-620 model introducing a
"Sleep Easy" function in the FireAngel ST-622 which allows the alarm to be
silenced a number of times in the event of a low battery warning. This product,
which is based on Sprue's Thermoptek technology, has been well received by the
UK F&RS. 
The "internet of things". Sprue has recently announced an agreement with
Intamac Systems Limited to provide Sprue's customers with the ability to
connect to and remotely monitor Sprue's Wi-Safe 2 home safety products over the
internet. Revenue from this project is expected to start in H2 2014 and a trial
will commence shortly. 
New product development. We continue to strengthen our technical team, adding
additional resources to bring greater certainty to the delivery of the product
road map in 2014 and beyond. Most of Sprue's technical resources focus on new
products for current markets, but Sprue will continue to fund investigative
research on new potential products to broaden its addressable markets where the
Board believes that the potential market opportunity warrants the investment. 
Move to AIM
As part of the defence of the BRK Brands bid in April 2013, the Independent
Directors undertook to seek shareholder support to move Sprue's listing to the
AIM market of the London Stock Exchange. Having consulted with major
shareholders and gained support, and as separately announced today, Sprue has
served notice to transfer its listing from ISDX to AIM, which is expected to be
completed before the end of April 2014. 
The Board believes that the move to AIM should broaden the investor base and
improve daily turnover and liquidity in Sprue's shares. 
Recommended final dividend
In line with its progressive dividend policy and taking account of the Group's
future prospects and cash resources, the Board is pleased to recommend a final
dividend of 6 pence per share (2012: 4 pence per share). The proposed cost to
the Group amounts to £2.4 million and is covered 1.7x by post-tax profit 
(2012:
1.5x). If approved by shareholders at the AGM on 20 May 2014, the record date
will be 20 June 2014 and the dividend will be paid to shareholders on 4 July
2014. 
Outlook
The Company has announced record sales for the year ended 31 December 2013. The
first quarter of 2014 has been another record start to the year for Sprue,
building on a strong first quarter last year. Continental Europe and UK F&RS
market segments have both performed ahead of budget, while UK Retail had a slow
start to the year compared to budget. Gross margin in the first quarter was in
line with the Board's expectations. The second quarter has started very
strongly with a record sales order book. 
The Board remains highly optimistic about the Group's prospects and with the
separate announcement released today regarding the transfer of the Group's
listing to AIM, 2014 is set to be another significant year in the progress of
the Group. The Board remains confident of the outlook for 2014 and of another
successful year. 
GRA Whitworth             Nick Rutter           John Gahan 
Chairman and Group CEO    Managing Director     Group Finance Director 
                               - ENDS -                                     


     The Directors of the issuer accept responsibility for this statement      


CONSOLIDATED PROFIT AND LOSS ACCOUNT

YEAR ENDED 31 DECEMBER 2013
                                                                       Restated
                                                                               
                                                             2013          2012
                                                                               


                                         Note            £000          
£000 
                                                                           
Turnover                                       2           48,357        37,806 
                                                                           
Cost of sales                                            (34,512)      (26,977) 
                                                                           
Gross profit                                               13,845        10,829 
                                                                           
Distribution costs                                          (602)         (613) 
                                                                           
Research and development                                    (450)         (443) 
                                                                           
Other administrative expenses*                            (7,926)       (6,553) 
                                                                           
Operating profit                                            4,867         3,220 
                                                                           
Interest receivable and similar income                          5             - 
                                                                           
Interest payable and similar charges           3                -          (43) 
                                                                           
Profit on ordinary activities before                        4,872         3,177
taxation                                                                        
                                                                           
Tax on profit on ordinary activities           4            (633)         (814) 
                                                                           
Profit for the year                                         4,239         2,363 
                                                                           
Earnings per share (pence)                     5                                
                                                                           
Basic                                                       10.85          6.50 
                                                                           
Fully diluted                                               10.20          6.22 


                                                                               

Continuing operations
None of the Group's activities are treated as acquired or discontinued during
the above two financial years.

Notes
Other administrative expenses* include £0.4m of bid defence costs (2012: 
£nil).

2012 sales, cost of sales and other administrative costs have been restated to
reflect the reclassication of certain items to be on a consistent basis with
2013.


STATEMENT OF TOTAL RECOGNISED GAINS & LOSSES

FOR THE YEAR ENDED 31 DECEMBER 2013
                                                             2013          2012
                                                                               


                                                         £000          
£000 
                                                                           
Profit for the year                                         4,239         2,363 
                                                                           
Currency translation differences on foreign                  (26)          (10)
currency net investments                                                        
                                                                           
Adjustment in respect of share-based payments                  15            19 
                                                                           
Total recognised gains for the year                         4,228         2,372 


                                                                               


CONSOLIDATED BALANCE SHEET

AS AT 31 DECEMBER 2013
                                                             2013      Restated
                                                                               
                                                                           2012
                                                                               


                                  Note                   £000          
£000 
                                                                           
Fixed assets                                                                    
                                                                           
Intangible fixed assets                                     3,049         2,266 
                                                                           
Tangible fixed assets                                         527           280 


                                                                               
                                                            3,576         2,546


                                                                           
Current assets                                                                  
                                                                           
Stocks                                                      7,670         5,403 
                                                                           
Debtors                                                    10,393         9,647 
                                                                           
Cash at bank and in hand                                    5,227         6,226 


                                                                               
                                                           23,290        21,276


                                                                           
Creditors: amounts falling due within one year           (10,860)     *(11,181) 
                                                                           
Net current assets                                         12,430        10,095 
                                                                           
Total assets less current liabilities                      16,006        12,641 
                                                                           
Provisions for liabilities             8                  (1,427)      *(1,048) 
                                                                           
Net assets                                                 14,579        11,593 
                                                                           
Capital and reserves                                                            
                                                                           
Called up share capital                                       801           771 
                                                                           
Share premium account                                       4,123         3,822 
                                                                           
Profit and loss account                                     9,655         7,000 
                                                                           
Shareholders' funds                                        14,579        11,593 


                                                                               

*Creditors falling due within one year and Provisions for liabilities in 2012
have been restated to include specific warranty provisions of £0.5m which were
included within Creditors falling due within one year in that year.


CONSOLIDATED CASH FLOW STATEMENT

FOR THE YEAR ENDED 31 DECEMBER 2013
                                                             2013          2012
                                                                               


                                         Note            £000          
£000 
                                                                           
Net cash inflow from operating activities      6            2,224         2,394 
                                                                           
Return on investment and servicing of                           5          (43)
finance                                                                         
                                                                           
Taxation                                                    (631)         (726) 
                                                                           
Capital expenditure and financial                         (1,355)         (963)
investment                                                                      
                                                                           
Equity dividend paid                                      (1,573)         (720) 
                                                                           
Cash flow before use of liquid resources                  (1,330)          (58)
and financing                                                                   
                                                                           
Financing                                                     331          (72) 
                                                                           
Decrease in cash during the year                            (999)         (130) 
                                                                           
Reconciliation of net cash flow to movement                                    
in net funds                                                                    
                                                                           
Decrease in cash during the year                            (999)         (130) 
                                                                           
Cash outflow from decrease in debt                              -           500 
                                                                           
Non-cash movement in loan and unamortised                       -           (6)
issue costs                                                                     
                                                                           
Change in net funds resulting from cash                     (999)           364
flows                                                                           
                                                                           
Translation difference                                          -           (3) 
                                                                           
Movement in net funds in the year                           (999)      361      
                                                                           
Net funds at beginning of year                              6,226         5,865 
                                                                           
Net funds at end of year                       7            5,227         6,226 


                                                                               

Notes to the preliminary financial information

1. Basis of preparation
The preliminary financial information has been prepared on the basis of the
same accounting policies as detailed in the statutory financial statements for
the year ended 31 December 2013.

Basis of accounting
The preliminary financial information is prepared under the historical cost
convention and in accordance with applicable United Kingdom accounting
standards and on a going concern basis.

Basis of consolidation
The preliminary financial information consolidates the financial statements of
Sprue Aegis plc and its subsidiary undertakings drawn up to 31 December 2013.
The results of subsidiaries acquired are consolidated for the period from the
date on which control passed. All intra-Group transactions, balances and
unrealised gains on transactions between Group companies are eliminated on
consolidation.

2. Turnover
The turnover, operating profit and net assets are wholly derived from the
Group's principal activity. An analysis of turnover by geographical market for
the two years ended 31 December 2013 is given below:
                                                                       Restated
                                                                               
                                                         2013              2012
                                                                               


                                                     £000              
£000 
                                                                           
United Kingdom and Eire                                26,466            25,576 
                                                                           
Continental Europe and other                           21,891            12,230 


                                                                               
                                                       48,357            37,806
                                                                               

3. Interest payable and similar charges
                                                               2013            2012
                                                                               


                                                       £000            
£000 
                                                                           
Interest on loan notes                                        -            (43) 


                                                                               

4. Taxation
                                                                 2013          2012
                                                                               


                                                         £000          
£000 
Current tax                                                                     
                                                                           
UK Corporation tax                                         (456)          (495) 
                                                                           
Foreign tax                                                 (88)           (50) 
                                                                           
Adjustments in respect of prior years                         81          (108) 
                                                                           
Total current tax charge and tax on profit                 (463)          (653)
on ordinary activities                                                          
                                                                           
Deferred tax                                                                    
                                                                           
Origination and reversal of timing                         (170)          (161)
differences                                                                     
                                                                           
Total deferred tax                                         (170)          (161) 
                                                                           
Total tax on profit on ordinary activities                 (633)          (814) 


                                                                               

5. Earnings per share
                                                                  2013       2012
                                                                             
                                                              £000       £000


                                                                         
Profit attributable to shareholders being profit after       4,239      2,363
taxation                                                                      


                                                                             
                                                               No.        No.


                                                                         
Weighted average number of shares in issue for basic        39,087     36,367
calculation (΄000)                                                            
                                                                         
Deemed issue of potentially dilutive shares (΄000)           2,452      1,706 
                                                                         
Weighted average number of shares in issue for diluted      41,539     38,073
calculation (΄000)                                                            
                                                                         
Earnings per share (pence)                                                    
                                                                         
- basic                                                      10.85       6.50 
                                                                         
- fully diluted                                              10.20       6.22 


                                                                             

6. Reconciliation of operating profit to net cash inflow from operating
    activities
                                                                         Restated  
                                                                               
                                                           2013            2012
                                                                               


                                                       £000            
£000 
                                                                           
Operating profit                                          4,867         3,220   
                                                                           
Amortisation of capitalised development costs               205           168  
and goodwill                                                                    
                                                                           
Depreciation charges                                        119            83   
                                                                           
Loss / (profit) on disposal of fixed assets                   1          (11)   
                                                                           
Exchange differences                                       (26)            12   
                                                                           
Share-based payment expense                                  15            19   
                                                                           
Movement in debtors                                       (680)       (2,620)   
                                                                           
Movement in stock                                       (2,267)         (480)   
                                                                           
Movement in creditors                                     (219)         2,022   
                                                                           
Movement in provisions - excluding deferred                 209          (19)  
tax                                                                             
                                                                           
Net cash inflow from operating activities               2,224           2,394   
7. Analysis of net cash 


                                           At beginning          Cash        At end
                                                                               
                                            of year         flows       of year
                                                                               


                                          £'000         £'000         
£'000 
                                                                           
Cash at bank and in hand                      6,226         (999)         5,227 


                                                                               

8. Provisions for liabilities
                                          Deferred tax       Warranty         Total
                                                       provisions              
                                                                               


                                         £'000          £'000         
£'000 
                                                                           
As at 1 January 2013 - as previously           523              -           523
stated                                                                          
                                                                           
Restatement                                      -            525           525 
                                                                           
As at 1 January 2013 - as restated             523            525         1,048 
                                                                           
Charged to profit and loss account             170          1,062         1,232 
                                                                           
Utilised within the year                         -          (853)         (853) 
                                                                           
Balance at 31 December 2013                    693            734         1,427 
                                                                            
Provisions for liabilities in 2012 have been restated to include specific
warranty provisions of £0.5m which were included within Creditors falling due
within one year in 2012, to ensure comparability. 
9. Related party: Jarden Corporation 
Jarden Corporation and its subsidiaries and associates (collectively referred
to as "Jarden") are related parties of the Group following Jarden's purchase in
2010 of a 29.9% interest in the ordinary share capital of Sprue Aegis and the
appointment of a Jarden nominated non-executive director, Tom Russo, to the
Sprue Aegis plc board in September 2012. At the year end, Jarden's interest in
the share capital of the Company was 26.6% (2012: 27.6%). 
Jarden, which includes BRK Brands, is the largest supplier by value to the
Group. 
2013 net purchases from Jarden amounted to £22.2m (including the distribution
fee of £4.16m). 2012 net purchases were £18.4m (including the distribution 
fee
of £4.16m). At the year end, net Jarden creditors amounted to £6.1m (2012: £
6.1m). 
10. Financial information 
The final results do not constitute full accounts within the meaning of section
434 of the Companies Act 2006 but is derived from the statutory financial
statements for the years ended 31 December 2013 and 31 December 2012. 
The final results have been prepared on the same basis as will be set out in
the statutory financial statements for the year ended 31 December 2013. 
The final results were approved for issue by the Board of Directors on 11 April
2014. 
The statutory financial statements for the year ended 31 December 2013 will be
delivered to the Registrar of Companies following the Company's Annual General
Meeting. Statutory financial statements for the year ended 31 December 2012 for
Sprue Aegis plc, have been filed with the Registrar of Companies. The auditors'
report on those accounts was unqualified and did not contain any statement
under Section 498 (2) or (3) of the Companies Act 2006. 
Copies of the statutory financial statements are also available from Sprue
Aegis plc's head office: Vanguard Centre, Sir William Lyons Road, Coventry, CV4
7EZ, or via the websites www.sprue.com or www.sprueaegis.com. 
END 
-0- Apr/14/2014 06:00 GMT
 
 
Press spacebar to pause and continue. Press esc to stop.