Mercury Recycling Group PLC
11 May 2007
MERCURY RECYCLING GROUP PLC
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2006
Mercury Recycling Group PLC, the recycler of fluorescent light tubes and sodium
street lights, quoted on AIM, announces final results for the year ended 31
December 2006.
• Group sales up 11% to £2,399,000 (2005: £2,147,000)
• Operating profit up 25% to £336,000 (2005: £268,000)
• Profit before tax of £84,000 (2005: £193,000 loss) after charging
goodwill of £204,000 (2005: £204,000) and relocation costs of nil
(2005:£216,000)
Enquiries:
Simon Lebor, Group Chief Executive
Mercury Recycling Group PLC Tel: 0161 877 0977
John Wakefield, Director
Blue Oar Securities Plc Tel: 0117 933 0020
CHAIRMAN'S STATEMENT
I am pleased to report further improvement for the year ended 31 December 2006.
Sales increased by 11% to £2,399,000 from £2,147,000 in 2005. Operating profit
increased by some 25% to £336,000 as against £268,000 in 2005. As will be seen
from the Balance Sheet, our liquid position is healthy, with current assets of
£668,000 despite the substantial capital expenditure setting up our new
recycling facilities.
I would have been reporting an even better outcome had it not been for the
further delay in implementing the WEEE Directive by the Government. This
Directive, will legally enforce the recycling of all separately collected end of
life Gas Discharge Lamps which should give a significant boost to the numbers of
lamps to be recycled.
The official start date is now 1 July 2007. However, there is still confusion
in Government Departments, The Environment Agency, Lamp Manufacturers,
Distributors, Purchasers, and Lamp Recyclers, as to how the implementation will
work in practice, and thus the determination of our position in this matter, is
giving us some concern.
Uncertainty has been created by the four major Lamp Manufacturers, who control
some 85% of the market. They have set up a single Compliance Scheme which
dominates the arrangements, and thus causes us major problems. The DTI, share
our concerns and are keen to help. Despite all these difficulties, Government
and Lamp Manufacturers advise that some 120 million lamps are sold per year, and
the current estimate is that only 25% of these are being recycled. As a leading
lamp recycler, we stand to benefit substantially, if the WEEE Directive is
sensibly implemented, and discussions are now taking place to sort out some of
the problems of the suggested Compliance Scheme.
Current trading continues to show new customers still coming to us every month.
However, the uncertainty in the market will affect volumes in the short term as
some of our customers are as yet unsure as to how the implementation will affect
them. The WEEE Directive was aimed at household waste and we had always
understood that our existing relations with customers would not be affected, but
the Compliance Scheme plans to cover business transactions, to which we are
opposed.
I have to report that Simon Lebor, our Chief Executive, wishes to retire at the
end of this year, and your Board have respected his wishes, but in doing so want
to pay a tribute to his tremendous service to the Group, from the very
beginning, as a small private company, to it's current status as a successful
quoted company. The Board hopes that Simon enjoys his retirement in good
health.
Mr Bryan Neill will continue in his present position as Managing Director.
Fortunately, Simon will remain in his customary active capacity as C.E.O. during
the difficult implementation of the WEEE Directive. In addition Mr A J Leon has
been appointed Non-Executive Financial Director.
On your behalf, I would again like to thank my colleagues and all our staff for
their hard work and continued commitment to the Group.
Yours sincerely,
The Rt Hon The Lord Barnett JP PC
Chairman
GROUP PROFIT AND LOSS ACCOUNT
As restated
2006 2005
£000 £000
Turnover 2,399 2,147
Cost of sales (193) (218)
Gross profit 2,206 1,929
Administrative expenses (2,096) (2,110)
Operating profit before amortisation and relocation costs 336 268
Relocation costs - (216)
Share based payment costs (22) (29)
Goodwill amortisation (204) (204)
Group operating profit/(loss) 110 (181)
Interest receivable 1 2
Interest payable and similar charges (27) (14)
Profit/(loss) on ordinary activities before taxation 84 (193)
Taxation - -
Profit/(loss) on ordinary activities after taxation
retained for the year 84 (193)
Earnings/(loss) per share - Basic 0.25p (0.58p)
- Diluted 0.24p n/a
The group's operation in the year continued unchanged; no operations were
disposed of or acquired.
There are no recognised gains or losses other than those passing through the
profit and loss account.
GROUP BALANCE SHEET
As restated
2006 2005
£'000 £'000
Fixed assets
Intangible assets 3,021 3,225
Tangible assets 1,142 1,142
4,163 4,367
Current assets
Debtors 533 531
Cash at bank and in hand 135 1
668 532
Creditors: amounts falling due within one year (307) (515)
Net current assets 361 17
Total assets less current liabilities 4,524 4,384
Creditors: amounts falling due after more than one year (271) (308)
Provisions for liabilities (78) (44)
4,175 4,032
Capital and reserves
Called up share capital 3,373 3,336
Share premium account 242 242
Other reserve 365 530
Merger reserve (111) (111)
Profit and loss account 306 35
Equity shareholders' funds 4,175 4,032
GROUP CASH FLOW STATEMENT
2006 2005
£'000 £'000
Net cash inflow from operating activities 404 145
Returns on investments and servicing of finance
Interest received 1 2
Interest paid (27) (14)
(26) (12)
Capital expenditure and financial investment
Payments to acquire tangible assets (96) (706)
Net cash inflow/(outflow) before financing 282 (573)
Financing
Receipts from issue of equity shares 20 -
Bank loan received - 300
Repayment of bank loan (15) -
Repayment of finance lease and hire purchase contract (24) (25)
Increase/(decrease) in cash 263 (298)
NOTE:
The financial information set out above does not constitute the Company's
financial statements for the year ended 31 December 2006. The financial
statements for 2006 have been audited and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting. The auditors have
reported on the 2005 statements; their report was unqualified and did not
contain a statement under section 237(2) or (3) of the Companies Act 1985.
Copies of the 2006 Report and Accounts will be mailed to shareholders shortly.
Further copies will be available for collection from the Company's offices at
Mercury House, 17 Commerce Way, Trafford Park, Manchester, M17 1HW.
This information is provided by RNS
The company news service from the London Stock Exchange