Regulatory News item

REG-SWP Group PLC Final Results
Released: 18/11/2009

http://pdf.reuters.com/Regnews/regnews.asp?i=43059c3bf0e37541&u=urn:newsml:reuters.com:20091118:RnsR6627C
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RNS Number : 6627C  
  
SWP Group PLC  
  
18 November 2009  
  
SWP Group Plc  
  
("SWP" or the "Group")  
  
Preliminary Results for the year ended 30 June 2009  
  
SWP Group (LSE: SWP), the industrial engineering group, is pleased to announce 
its preliminary results for the year ended 30 June 2009.  
  
Highlights  
  
 
 * Group sales decline restricted to 1.2% at £24.75M (2008 - £25.06M). 
 * Gross margins increased to 40.3% (2008 - 36.0%). 
 * Operating profits1 increased by 14.1% to £2.29M (2008 - £2.01M). 
 * Pre-tax profits2 ahead by 15.2% at £1.63M (2008 - £1.42M). 
 * Underlying earnings per share2 advanced by 2.5% to 9.02p (2008 - 8.80p). 
 * Challenging market conditions particularly in the UK for Fullflow and 
Crescent countered by strong revenue growth at DRC-Ulva where sales advanced 
44.4% and operating profits increased by 32.5%. 
 * Overhead structure of each business within the Group tailored to the change 
in market conditions brought about by the downturn in economic activity.  
 * Successful implementation of international strategy at Fullflow with orders 
received from a number of different countries. 
 * Substantial order received by Fullfow Sistemas for enhancement works at 
Barajas Airport, Madrid 
 * Plasflow's customer base extended leading to firm expectation of sales growth 
this year. 
 * DRC's manufacturing competence enhanced through the production of high 
quality Ulvashield with onward development of its own portfolio of products 
including Hylam Uniroof, FPA and Hylam IQ. 
 * Strong recovery potential at Crescent as market conditions improve with 
restoration to profit expected during the current year. 
 * Overall current year started well with order books charged in anticipation of 
strong organic growth notwithstanding the extremely challenging conditions 
facing the construction sector.  
 * Current year should see a dramatic reduction in Group debt. 
 * Board of Directors expects a maiden dividend to be declared and paid in 
2010.  
  
1 before adjustment for negative goodwill credit and amortisation of intangible 
assets acquired through    
  business combinations net of deferred tax  
  
   2 before adjustment for negative goodwill credit  
  
 Chairman's Statement  
  
Corporate Review  
  
At the commencement of the financial year on 1st July 2008 there were already 
signs that a significant slowdown in economic activity was about to take place. 
The drama which subsequently unfolded in terms of global recession triggered by 
a total collapse of the world's banking system was of unprecedented proportions 
and against such an unpromising background your Group has produced a set of 
highly resilient results. Your Board of Directors considers this to be strong 
testament to the quality of the Group's brands which generally enjoy 
market-leading positions in the construction, oil, gas and petrochemical 
industries on an increasingly international basis.   
  
Most of our businesses operate in a project driven environment which is very 
sensitive to the investment climate in the markets into which we sell. Not 
surprisingly the general lack of confidence which prevailed throughout the year 
meant that many projects were cancelled or postponed and this led directly to a 
decline in activity at both Fullflow Group (rainwater management systems) and 
Crescent of Cambridge (fabricated metal staircases). However the resulting 
revenue shortfall was substantially offset by the increased international 
success of our recently acquired Ulva brand which sells specialised polymer 
membranes to the oil, gas and petrochemical majors around the world to provide 
pipework protection systems designed to reduce Corrosion Under Insulation 
(CUI).  
  
Despite the impact of the recession the Group has continued to build momentum 
across its increasingly international base and our management teams are working 
hard to counter the difficult market conditions by developing new strategic 
alliances and strengthening relationships with key customers based on the 
provision of consistently high levels of service and product quality combined 
with innovation and attention to detail.  
  
Results  
  
Group sales for the year ended 30th June 2009 were down 1.2% at £24.75M (2008 - 
£25.06M) although due to a favourable mix of business biased towards Ulva, gross 
margins increased to a highly respectable level of 40.3% (2008 - 36.0%). 
Operating profits (before amortisation of intangible assets under IFRS 
accounting) increased by 14.1% to £2.29M (2008 - £2.01M) and profit before tax 
by 15.2% to £1.63M (2008 -£1.42M before the negative goodwill credit). Basic 
earnings per share rose by 2.5% to 9.02p per share (2008 - 8.80p per share).  
  
Last year I explained in some detail the requirement to adopt the rules 
associated with International Financial Reporting Standards (IFRS) and this task 
has now been completed. The principal issue which remains material to our 
numbers is the requirement for us to carry the Ulva brand (which was acquired on 
29th November 2007) at an independently assessed "fair value" whereas our other 
valuable brands such as Fullflow, Plasflow, Crescent and Hylam IQ continue to be 
carried in our balance sheet (under GAAP accounting standards) at their historic 
book values or at their value when originally acquired.  
  
During this difficult year your Board has applied considerable attention to the 
specific needs of each business within the Group. For example in the case of 
both Fullflow and Crescent it has been necessary to reduce the operational cost 
base to reflect the decline in market activity, although where possible we have 
endeavoured to retain enough resources to allow us to take advantage of the 
opportunities which will emerge when markets once again regain their composure. 
On the other hand there has been the need for us to authorise significant levels 
of investment in the Ulva operation to facilitate penetration into specific key 
market areas. These issues are explained in more detail below in the Operational 
Review of each of the businesses. The challenges and risks associated with each 
business differ enormously due to the nature of the sectors within which they 
operate but it is certainly the case that the Group's increasing diversity, in 
terms of products, customers and geographical spread, has helped to protect us 
from the worst effects of the recession.  
  
Finance  
  
The Group's consolidated balance sheet continues to grow with Shareholders Funds 
increasing by 14.2% to £12,473,000 from £10,922,000 in 2008. One of our 
priorities is to reduce bank debt and in the medium term we aim to be debt free. 
Whilst bank debt at 30th June 2009 (£6,727,000) was actually higher than a year 
earlier (2008 - £6,475,000) the subsequent receipt of ILC's (Irrevocable Letters 
of Credit) in respect of June 2009 export sales has kick started the debt 
reduction process which we believe will continue for the remainder of the 
current financial year and beyond. This positive trend will lead to 
substantially reduced interest charges which will contribute to the future 
earning capacity of the Group.  
  
Shareholders will note that the deficit at Retained Earnings has now reduced to 
a modest £420,000 (2008 - £1,971,000 restated). In anticipation of further 
profits being earned in the current year your Board intends to take the 
necessary steps to reconstruct the Group balance sheet so as to simultaneously 
eliminate the Share Premium Account and boost Called Up Share Capital and 
Retained Earnings. Our aim is to increase the Group's Distributable Reserves 
which is a prerequisite to allow us to consider the possibility of declaring a 
dividend. We hope and indeed anticipate that we will be in a position to propose 
such a dividend to shareholders a year from now.  
  
The Group's working capital model is under constant review particularly in these 
difficult times when credit insurance is almost a thing of the past and credit 
terms are often under strain. Almost all of our export business is conducted 
through the use of ILC's which provides a positive level of assurance (on a bank 
to bank basis) allied to the ability to predict accurately when cash will be 
received.   
  
Review of Operations  
  
Fullflow Group (Rainwater Management Division)  
  
The year under review was almost certainly the most difficult in Fullflow's 
history. In some market sectors, such as industrial warehousing and offices, 
construction activity slowed dramatically as the confidence of developers 
collapsed and the availability of finance for new projects dried up in the wake 
of the credit crunch. A trend which started in the UK quickly spread to Spain 
and then France with the result that enquiry levels from the private sector in 
all our principal markets reduced sharply. Overall, the value of tenders 
submitted fell by around 20% but this figure does not show the true extent of 
the problem since many projects for which we tendered were delayed indefinitely 
or cancelled. Against such an unpromising background we consider that Fullflow 
has produced a highly respectable result for the year, even though both turnover 
and profit were lower than in the previous year. Third party sales fell by 4.1% 
to £15,389,000 (2008 - £16,048,000) and operating profits by 15.6% to £801,000 
(2008 - £949,000).   
  
The dire market conditions meant that in each of Fullflow's three main rainwater 
drainage businesses it was necessary to implement redundancy programmes and we 
believe that in each case the lower cost base reflects more accurately the 
changed circumstances in which we are operating. Although our overall wish has 
been to ensure that the businesses remain profitable, we have taken a deliberate 
decision to retain a number of experienced people whose input will be vital if 
we are to make the most of those opportunities which arise in the months ahead. 
It is a major irony of this recession that more than ever there is a need for 
things to move very quickly indeed on those projects which do proceed to the 
construction phase.  
  
On a more positive note, Fullflow began to see some benefit from its planned 
strategy of exporting its knowledge and expertise into new territories across 
the world. Strong contacts now exist in Australia, India, Korea, Singapore, 
Saudi Arabia and South America and orders have started to come through from some 
of these countries. Fullflow has also won a large contract for the new terminal 
at Doha Airport, although this contract is being fulfilled almost entirely by 
the UK operations team. The increasing importance of Fullflow's position in 
international markets has led to the creation of a new company within Fullflow 
Group - Fullflow International.  
  
Closer to home, Fullflow has also been successful on two of the projects being 
overseen by the Olympic Delivery Authority for the London Olympics in 2012 - the 
main Media Hub and the Basketball Arena. We are hopeful that further orders will 
follow in the coming months as construction activity in this area increases in 
the run up to this spectacular event.  
  
Elsewhere in the Fullflow organisation, Plasflow enjoyed a very encouraging 
year, with third party sales increasing by more than 80%. Plasflow is now widely 
recognised as one of the UK's leading manufacturers of specialist plastic pipe 
fabrications and its proven ability to achieve consistently high standards of 
quality and service, as well as offering innovative design solutions which 
reduce on-site labour input, means that it enjoys high levels of repeat business 
from its customers. Year by year Plasflow's customer base is being expanded and 
with activity levels in its main markets likely to remain fairly healthy there 
is every reason for us to be optimistic about Plasflow's capacity to achieve 
further strong growth in the current year and beyond.  
  
All in all we believe that Fullflow Group has responded well to the hostile 
market conditions which it has encountered in the wake of the credit crunch and 
this bodes well for the future, no matter how long it takes for economic 
recovery to produce a revival in the fortunes of the construction industry as a 
whole.  
  
Crescent of Cambridge (Metal Staircase Division)  
  
The Crescent brand remains strong and well respected as a leading supplier of 
structural steel staircases to the UK construction industry. However Crescent's 
revenues during the year under review were significantly impacted by the 
collapse of the market sectors which it serves. Sales fell by 37.9% to 
£2,757,000 (2008 - £4,440,000) and after taking into account redundancy costs 
and some significant bad debts, the business recorded an operating loss of 
£350,000 (2008: £157,000 profit).   
  
This is the first loss recorded at Crescent in over 10 years and the management 
has responded decisively to restore the company to profit on a much reduced 
overhead base. Indeed the business has been substantially re-engineered, a move 
which has been substantially driven by the benefits arising from the strategic 
investment we have made in design automation during the last two years. The 
re-configured Crescent is far more flexible and responsive than before: it has a 
core team of long-serving experienced employees, and with the current cost 
structure and realistic planned revenues, it should return to profit this year.  
  
However key investment continues, particularly in relation to the further 
integration of design and manufacturing and the planned recruitment of a small 
number of key people to enhance the company's sales and marketing capability. In 
the face of a declining market and fiercely competitive pricing, Crescent's 
ability to offer fast response times and peerless service levels to its 
customers will be essential to its success.  
  
DRC - Ulva (Polymer Membrane Division)  
  
Shareholders will recall that we established this new division last year by 
combining the Group's existing polymer manufacturing business with the newly 
acquired Ulva brand whose products service the oil, gas and petrochemical 
sectors for the management of Corrosion Under Insulation (CUI). As forecast the 
Ulva acquisition has proved to be highly successful with the division exporting 
more than 65% of its output to installations located in territories including 
the Far East, Middle East, the Caspian Sea, Continental Europe, Scandinavia and 
the USA. Third party sales for the division rose to £6,599,000 (2008 - 
£4,570,000) an increase of 44.4% whilst operating profits advanced by 32.5% to 
£616,000 (2008 - £465,000) after the application of management charges and 
product royalties due to the Group.  
  
 
DRC Polymer Products  
  
Effectiveness is the most appropriate word to describe the progress achieved by 
DRC during the year under review. The business in now manufacturing product with 
a higher level of process control than at any time in its history, delivering 
not only high product quality at tighter tolerances but also with a 
substantially reduced level of waste.  
  
DRC continues to hold a dominant share of the UK modular build roofing market 
through its Hylam Uniroof product. The overall size of this niche market is 
dependent upon the health of the construction sector and DRC experienced an 
approximate 30% decline in activity compared to the previous year. However DRC 
enjoys a longstanding relationship with a loyal customer base and should benefit 
from higher volumes as soon as market conditions improve for its customers.  
  
DRC's acclaimed Hylam IQ product has now been used by four of the UK's twenty 
five water utilities to ensure the integrity of the roofs which protect 
reservoirs of treated drinking water from pollution. As well as being the only 
available system which can offer such assurance to the owners of such assets, 
the Hylam IQ system has the capability to electronically pinpoint the location 
of potential leaks, substantially reducing the time and cost of repairs. Overall 
expenditure in the sector has been relatively low in the run up the start of the 
new Asset Management Programme (AMP5) in April 2010 but the commencement of the 
new programme should boost sales and ensure that our long-term investment in the 
development of this unique system is rewarded. The recent appointment of an 
electronics specialist has allowed the system to be further developed to improve 
the ease of installation by reducing the systems susceptibility to the varying 
conditions which exist at different sites across the country.  
  
Efforts to increase DRC's activity in the area of Special Engineered Membranes 
have begun to bear fruit with a fairly robust year for its Drinking Water 
Inspectorate (DWI) approved Hylam FPA membrane for tank lining and baffle 
curtains, including a significant order for Oman. A product development 
programme is underway in an attempt to produce a variant of this product which 
will have enhanced market potential. Overall, the basket of products in this 
area performed ahead of expectation and it is anticipated that at least one of 
the new product prototypes currently being evaluated will become a commercial 
reality within the foreseeable future.    
  
The plan to re-commence manufacture of Ulvashield at DRC was delayed 
considerably by the failure of a contractor to effectively complete an upgrade 
to key plant on time. The problem was finally resolved towards the mid-point of 
the financial year but the delay had a material effect on the profitability of 
the business for the year as a whole. However Ulvashield is now in full 
effective production at DRC and growth in the Ulva business will lead to a 
direct and proportionate increase in production at DRC.  
  
Ulva Insulation Systems Ltd.    
  
Back in the 1990's, when Ulvashield was first introduced into the North Sea oil 
sector, it represented a radical departure from the traditional methods of 
cladding insulation on process pipework and vessels which were based on the use 
of various types of metal.    
  
The early adopters of the product have been rewarded with substantially extended 
service life which has significantly reduced the requirement for ongoing 
maintenance and delivered a much reduced full life cost for those projects. 
Critically, where Ulvashield has been applied, the incidence of Corrosion Under 
Insulation (CUI) has been substantially reduced. Subsequently, those early 
Ulvashield adopters, reassured by the performance of the product in the harsh 
environment of the North Sea, have specified Ulva as their product of choice and 
today Ulvashield protects many prestigious assets, both onshore and offshore, in 
all areas of the world.   
  
Even so 80% of new installations across the world still utilise metallic 
cladding and this shows the size of the potential market available to Ulva. The 
passage of time has produced a compelling body of evidence testifying to the 
advantages of non-metallic cladding systems, and at a time when the management 
of corrosion is a major issue for most operators, Ulva is well positioned to 
take advantage of the likely swing in favour of the type of system which it 
offers.   
  
During the year, new offices were established in Houston, Texas and Kuala 
Lumpur, Malaysia. The role of the Houston office is to provide technical support 
to the numerous end users and design houses which are based in that locality but 
specify solutions for projects being undertaken all over the world. The 
South-East Asia sales office provides local support in a key region of the world 
for Ulva. The appointment of dedicated individuals to work out of these offices 
has added to the strength of Ulva's existing team and has already opened up some 
exciting opportunities.    
  
Ulva's sister company DRC Polymer Products employs rigorous quality control in 
the manufacture of the base Ulvashield product, an approach which continues 
through the conversion process in Ulva's factory. However, in common with any 
weather proofing system, metallic or non-metallic, the integrity of the system 
is only as good as its application. In this regard, Ulva has continued to invest 
during the year in the development of the system as a whole in order to further 
improve its ease of application. This has resulted in additional investment in 
tooling to extend the range of moulded fittings and components, and the 
extension of the product range to simplify the on-site installation process and 
improve the effectiveness of sealing around penetrations.    
  
Revenue growth will continue to be influenced by the peaks and troughs 
associated with the timing of major projects, but overall the number of such 
projects is planned to increase which should promote a trend of consolidated 
growth. Revenue growth from increased project activity will be underpinned by 
the steady increase in the application of Ulvashield as best practice for 
in-field maintenance for both the growing installed base of Ulvashield and to 
replace aging metallic cladding. Management's focus for the development of the 
Ulva business is long-term. Projects typically have long gestation periods with 
those currently in the Front End Engineering Design (FEED) stage unlikely to be 
in the construction yards for three to four years.  
  
It is pleasing for us to report that Ulva's present facilities and operations 
are sufficient to meet the level of growth planned for the next five years with 
only a modest level of investment.  
  
Earnings per share.    
  
In respect of ordinary trading activities underlying EPS have increased by 2.5% 
to 9.02p against 8.80p in 2008.  
  
Employees  
  
On behalf of the Board and our shareholders I wish to express my sincere 
gratitude to all of the Group's employees for their dedication, commitment and 
energy during what has been an exceptionally difficult period. We recognise that 
the contribution of employees at every level is fundamental to the long-term 
success of the Group.   
  
Future Prospects   
  
Your Group has made a solid start to the new financial year. Within our DRC - 
Ulva division we are developing a long term plan which is designed to deliver 
revenue growth across a number of key markets into which we sell our range of 
Ulvashield products. Order levels are highly encouraging and this business 
remains the principal driver in terms of generating increased profit levels and 
positive cash flows for the Group. Prospects for increased sales of Hylam IQ are 
also most encouraging.  
  
Within Fullflow Group order levels have picked up strongly in our international 
business which is entirely consistent with the plan to globalise the Fullflow 
brand and its range of offerings. Within the last month Fullflow's Spanish 
operation has secured a very substantial order for the enhancement of the 
rainwater management systems at Barajas Airport in Madrid but elsewhere the 
market remains very challenging.  
  
At Crescent of Cambridge the reshaped business has achieved some notable project 
wins in its traditional markets and higher revenues should restore the company 
once again to the route of profitable growth which we hope to sustain as market 
conditions improve.   
  
Overall, we remain cautiously optimistic that the dynamics of this Group have 
the potential to deliver substantial increases to both revenues and maintainable 
profits. Whilst the year under review has been one of containment and measured 
response to changing market conditions we anticipate that the current year will 
see us reap the reward for a lot of the hard work we have engaged in during the 
last twelve months and before. Despite the continuing impact of the recession on 
many of our principal markets we believe that we are on course to deliver 
considerable enhancement to shareholder value in the coming years.  
  
J A F Walker  
  
Chairman  
  
Group Income Statement  
  
 
                                                                                             
                                                                                             
  Year ended 30 June 2009                                               2009       2008      
                                                                Notes   £'000      £'000     
                                                                                             
  Revenue                                                       2       24,745     25,058    
  Cost of sales                                                         (14,764)   (16,038)  
  Gross profit                                                          9,981      9,020     
  Operating expenses                                                    (7,558)    (7,014)   
                                                                        2,423      2,006     
  Exceptional operating expenses                                        (134)      -         
  Amortisation of intangible assets acquired through business           (165)      -         
  combinations net of deferred tax                                                           
  Operating profit before negative goodwill arising on          2       2,124      2,006     
  acquisition                                                                                
  Negative goodwill                                                     -          6,175     
  Operating profit                                                      2,124      8,181     
  Financial income                                                      42         50        
  Financial costs                                                       (534)      (639)     
  Profit on ordinary activities before taxation                         1,632      7,592     
  Income tax (charge)/credit                                            (37)       86        
  Profit for the period attributable to equity holders of the   2       1,595      7,678     
  parent                                                                                     
                                                                3       9.02p      45.05p    
  Basic earnings per share (pence)                                                           
  Diluted earnings per share (pence)                            3       9.02p      45.05p    
  
  
Turnover and operating profit all derive from continuing operations.  
  
There were no recognised gains and losses for 2009 or 2008 other than those 
included in the Group Income Statement.  
  
Group Statement of Changes in Equity  
  
 
                                          Called up share capital   Share premium account   Capital reserve   Revaluation reserve (as restated)   Profit & loss account (as restated)   Total                  
                                                                                                                                                                                        Equity (as restated)   
                                          £'000                     £'000                   £'000             £'000                               £'000                                 £'000                  
                                                                                                                                                                                                               
  At 1 July 2007                          85                        11,878                  41                -                                   (9,420)                               2,584                  
  Issue of share capital                  4                         656                     -                 -                                   -                                     660                    
  Result for the year                     -                         -                       -                 -                                   7,678                                 7,678                  
  Reinstatement of revaluation reserve                              -                       -                 229                                 (229)                                 -                      
  (see note 4)                            -                                                                                                                                                                    
                                                                                                                                                                                                               
  At 30 June 2008                         89                        12,534                  41                229                                 (1,971)                               10,922                 
  Result for the year                     -                         -                       -                 -                                   1,595                                 1,595                  
  Purchase of treasury shares                                       -                       -                 -                                   (44)                                  (44)                   
                                          -                                                                                                                                                                    
                                                                                                                                                                                                               
  At 30 June 2009                         89                        12,534                  41                229                                 (420)                                 12,473                 
  
  
Group Balance Sheet  
  
 
  At 30 June 2009                                     2009          2008 as restated        
                                                      £'000         £'000                   
  Non current assets                                                                        
  Intangible assets                                   9,045         9,293                   
  Property, plant and equipment                       5,114         5,165                   
  Trade and other receivables                         655           549                     
  Deferred tax assets                                 1,150         888                     
                                                      15,964        15,895                  
  Current assets                                                                            
  Inventories                                         3,972         3,783                   
  Trade and other receivables                         9,866         9,459                   
                                                      13,838        13,242                  
  Total assets                                        29,802        29,137                  
  Current liabilities                                                                       
  Trade and other payables                            (7,410)       (8,418)                 
  Current tax liabilities                             (309)         (271)                   
  Obligations under finance leases                    (117)         (163)                   
  Bank loans overdrafts                               (4,127)       (6,475)                 
                                                      (11,963)      (15,327)                
  Non current liabilities                                                                   
  Bank loans                                          (2,600)       -                       
  Deferred tax liabilities                            (2,719)       (2,771)                 
  Obligations under finance leases                    (47)          (117)                   
                                                      (5,366)       (2,888)                 
                                                                                            
  Total liabilities                                   (17,329)      (18,215)                
  Net assets                                          12,473        10,922                  
                                                                                            
  Equity                                                                                    
  Called up share capital                             89            89                      
  Share premium account                               12,534        12,534                  
  Capital reserves                                    41            41                      
  Revaluation reserve                                 229           229                     
  Retained earnings                                   (420)         (1,971)                 
  Equity attributable to shareholders of the parent   12,473        10,922                  
  
  
The consolidated financial statements were approved and authorised for issue by 
the Board of Directors on 17 November 2009 and were signed on its behalf by   
  
D.J. Pett  
  
Director of Finance  
  
 Group Cash Flow Statement   
  
Year ended 30 June 2009  
  
 
                                                            Note      2009       2008                
                                                                      £'000      £'000 as restated   
                                                                                                     
  Profit after tax                                                    1,595      7,678               
  Adjustments for:                                                                                   
  Negative goodwill                                                   -          (6,175)             
  Net finance costs                                                   492        589                 
  Corporation tax charge                                              269        271                 
  Depreciation of property, plant and equipment                       414        334                 
  Amortisation of intangible assets                                   243        15                  
  Profit on disposal of plant and equipment                           (6)        -                   
  Operating cash flows before movement in working capital             3,007      2,712               
  Increase in inventories                                             (189)      (507)               
  Increase in receivables                                             (735)      (3,276)             
  (Decrease)/increase in payables                                     (967)      1,972               
  Interest paid                                                       (612)      (589)               
  Interest received                                                   2          -                   
  Corporation tax paid                                                (231)      (44)                
  Net cash inflow from operating activities                           275        268                 
                                                                                                     
  Cash flow from investing activities                                                                
  Purchase of property, plant and equipment                           (384)      (308)               
  Purchase of intangible assets                                       (10)       (28)                
  Acquisition of business, net of cash                                -          (628)               
  Proceeds for disposals of property, plant and equipment                                            
                                                                      27         -                   
  Net cash outflow from investing activities                          (367)      (964)               
  Cash flow from financing activities                                                                
  Issue of ordinary shares                                            -          660                 
  Purchase of treasury shares                                         (44)       -                   
  Finance lease repayments                                            (116)      (123)               
                                                                                                     
  Net cash inflow from financing                                      (160)      537                 
  activities                                                                                         
  Net decrease in cash and bank                                                                      
  overdrafts                                                          (252)      (159)               
  Cash, cash equivalents and bank overdrafts at             4                                        
  beginning of period                                                 (3,225)    (3,066)             
  Cash, cash equivalents and bank overdrafts at end of      4                                        
  period                                                              (3,477)    (3,225)             
  
  
Notes to the Financial Statements   
  
1. BASIS OF PREPARATION  
  
Whilst the information included in this preliminary announcement has been 
prepared in accordance with the recognition and measurement criteria of 
International Financial Reporting Standards ("IFRSs") as adopted for use in the 
European Union and as issued by the International Accounting Standards Board, 
this announcement does not itself contain sufficient information to comply with 
IFRSs.  
  
The preliminary announcement for the 12 months to 30 June 2009 has been prepared 
on a consistent basis with the financial accounting policies set out in the 
Accounting Policies section of the SWP Group Plc Annual Report and Financial 
Statements 2008, with the exception of a change in accounting estimate in 
respect of the amortisation of certain Intangible Assets. The Directors are of 
the opinion that expected economic life of trade names is indefinite and the 
expected economic life of all other intangible assets is between 5 and 20 years, 
depending upon the asset. In the prior year, the Directors assessed that the 
useful economic life of intangible assets was between 5 and 15 years.  
  
2.    SEGMENTAL REPORTING  
  
BUSINESS SEGMENTS  
  
 
                                                                 Metal staircases           Polymer  membrane                                  
                                     Rainwater management        year ended 30 June 2009    year ended                           Total         
                                     year ended 30 June 2009                                30 June              Corporate       year ended    
                                                                                            2009                 year ended      30 June       
  2009                                                                                                           30 June 2009    2009          
                                     £'000                       £'000                      £'000                £'000           £'000         
                                                                                                                                               
  Revenue                                                                                                                                      
  Total external revenue             15,389                      2,757                      6,599                -               24,745        
                                                                                                                                               
  Result                                                                                                                                       
  Segment result                     801                         (350)                      616                  1,057           2,124         
  Negative goodwill on acquisition                                                                                               -             
  Operating profit                                                                                                               2,124         
  Finance costs, net                                                                                                             (492)         
                                                                                                                                               
  Profit before tax                                                                                                              1,632         
  Income tax (charges)/credit                                                                                                    (37)          
  Profit for the year                                                                                                            1,595         
                                                                                                                                               
  Other information                                                                                                                            
  Capital expenditure                111                         101                        105                  77              394           
  Depreciation and amortisation      164                         126                        82                   285             657           
  Segmental assets                   12,242                      2,480                      5,835                9,245           29,802        
  Segmental liabilities              (8,421)                     (705)                      (5,172)              (3,031)         (17,329)      
  Net assets as at                   3,821                       1,775                      663                  6,214           12,473        
  30 June 2009                                                                                                                                 
  
  
 
                                                                 Metal staircases           Polymer                                                
                                     Rainwater management        year ended 30 June 2008    membrane year ended     Corporate       Total          
                                     year ended 30 June 2008                                30 June                 year ended      year ended     
                                                                                            2008                    30 June 2008    30 June 2008   
  2008                                                                                                                                             
                                     £'000                       £'000                      £'000                   £'000           £'000          
                                                                                                                                                   
  Revenue                                                                                                                                          
  Total external revenue             16,048                      4,440                      4,570                   -               25,058         
                                                                                                                                                   
                                                                                                                                                   
  Result                                                                                                                                           
  Segment result                     949                         157                        465                     435             2,006          
  Negative goodwill on acquisition                                                                                                                 
                                                                                                                                    6,175          
  Operating profit                                                                                                                  8,181          
  Finance costs, net                                                                                                                (589)          
  Profit before tax                                                                                                                 7,592          
  Income tax credit                                                                                                                 86             
  Profit for the year                                                                                                               7,678          
                                                                                                                                                   
  Other information                                                                                                                                
  Capital expenditure                109                         89                         584                     9,279           10,061         
  Depreciation and amortisation      172                         96                         76                      5               349             
  
  
More to follow, for following part double-click [nRn2R6627C]