Friday 18 May 2007

2006 was a year of significant progress for Havelock. Underlying pre-tax profit increased substantially for a fifth successive year, with all three Divisions performing strongly.

Financial Overview

Revenue increased by 14% to £114.5 million (2005: £100.2 million).

Underlying pre-tax profit increased by 16% to £5.8 million (2005: £5.0 million) after adding back £0.4 million (2005: £0.4 million) in respect of the amortisation of intangibles and subtracting in 2005 £1.4 million (2006: nil) in respect of a non-recurring pension credit. Underlying fully diluted earnings per share were 11.6p (2005: 10.3p), up 13%. Reported pre-tax profit was £5.4 million (2005: £6.0 million), the comparable figure for 2005 being boosted by the non-recurring pension credit of £1.4 million, and reported fully diluted earnings per share amounted to 10.6p (2005: 12.1p).

Net debt reduced to £13.5 million (2005: £14.1million). Net financing costs reduced to £1.6 million (2005: £1.8 million) and were covered 4.7 times (2005: 3.6 times) by underlying operating profit. During the year, Havelock's remaining 17% stake in its overseas associate, Havelock AHI, based in Bahrain, was sold, yielding net proceeds of £0.9 million.

In February 2007, the Group's financial position was further enhanced by the raising of £4.9 million through the issue of 3.2 million new ordinary shares. This was applied in part to fund the acquisition of Stage Systems Limited, an educational furniture business, for a total consideration of £3.45 million.

Dividends

The Board is proposing a final dividend per share of 3.0p (2005: 2.7p), up 11%. If approved at the Annual General Meeting on 26 June 2007, the dividend will be paid on 4 July 2007 to shareholders on the register at close of business on 8 June 2007.

Including the interim dividend per share of 1.0p (2005: 0.9p), paid on 27 December 2006, proposed dividends per share for the year will total 4.0p (2005: 3.6p), which is up 11% on 2005 and covered 2.9 times by underlying EPS.

Board

With effect from 23 October 2006, Roland van Bommel and Michael Derbyshire were appointed as non-executive directors.