REG - NWF Group PLC - Half Year Results
04/02/2025 07:15
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RNS Number : 7486V NWF Group PLC 04 February 2025
For release 7.00am Tuesday 4 February 2025
NWF Group plc
NWF Group plc: half year results for the six months ended 30 November 2024
NWF Group plc ('NWF' or 'the Group'), a specialist distributor, today
announces its half year results for the six months ended
30 November 2024.
H1 2024 H1 2023 %
Financial highlights
Revenue £454.3m £472.9m (3.9)
Headline operating profit1 £5.0m £4.0m 25.0
Headline profit before taxation1 £3.6m £3.4m 5.9
Diluted headline earnings per share1 5.5p 5.1p 7.8
Interim dividend per share 1.0p 1.0p -
Net cash 2 £11.4m £13.3m (14.3)
Statutory results
Operating profit £3.6m £4.6m (21.7)
Profit before taxation £2.1m £3.8m (44.7)
Diluted earnings per share 3.2p 5.5p (41.8)
Net debt (including IFRS 16 lease liabilities) £39.1m £14.3m >100
1 Headline operating profit excludes exceptional items (see note 4) and
amortisation of acquired intangibles. Headline profit before taxation excludes
exceptional items, amortisation of acquired intangibles and the net finance
cost in respect of the Group's defined benefit pension scheme. Diluted
headline earnings per share also takes into account the taxation effect
thereon.
2 Net cash excluding IFRS 16 lease liabilities.
Group highlights
• Strong first half performance in line with the Board's expectations.
• Year-on-year growth in headline operating profit and headline profit
before tax reflecting good performances in Fuels and Feeds, which offsets a
slower first half performance in Food.
• Positive cash generation resulting in a robust cash position,
totalling £11.4 million at the half year end; this underpins the well
progressed pipeline of acquisition opportunities in Fuels.
• The Board's full year trading expectations remain unchanged ahead of
the seasonally more significant second half.
Business highlights
Fuels Headline operating profit of £1.7 million (H1 2023: £0.7 million). Volumes
were consistent with the prior year, but performance benefitted from improved
margins and a lower cost base reflecting strong cost management action taken
early in the period.
Food Headline operating profit of £2.5 million (H1 2023: £2.9 million). Stock
levels increased as the Lymedale warehouse became fully operational and
transitioned to optimal capacity. Performance lagged the prior year reflecting
the start-up costs of Lymedale.
Feeds Headline operating profit of £0.8 million (H1 2023: £0.4 million). Volumes
ahead of the prior year and the overall market. The milk price has steadily
increased since September supporting continued feed usage whilst raw material
prices have been stable.
Chris Belsham, Chief Executive Officer, NWF Group plc, commented:
"The Group has delivered a positive first half and we are trading in line with
our expectations for the year as a whole. We are pleased with the improved
performance in both Fuels and Feeds which has offset the short-term weaker
performance in Food as we continued the stock build in the Lymedale warehouse.
"Our pipeline of target acquisitions in Fuels is strong as we continue to
consolidate the fragmented fuels distribution market. We have also continued
to progress our key performance initiatives, aimed at enhancing our commercial
approach and operational efficiency across the Group.
"Supported by our strong financial position, our outlook is unchanged and we
remain confident in NWF's growth potential and prospects."
A virtual meeting is being held today for analysts starting at 9.30am. For
login details please contact NWF@mhpgroup.com
(https://protect.checkpoint.com/v2/r06/___mailto:NWF@mhpgroup.com___.ZXV3MjpuZXh0MTU6YzpvOjljOGNhNzE4NzYyOGNiN2E4YjJmZGY2ZWRkZmRhZWE1Ojc6MzNiMjpmODAwMmRhM2IyZjdkYTQ5NWM5MTZmOTVjZDc0NWM4NTkzMzZiMGE5Njg2NDBjMDhlMGY2N2M4N2FiYTFiYzhlOnA6RjpG)
.
Information for investors, including analyst consensus forecasts, can be found
on the Group's website at www.nwf.co.uk
(https://protect.checkpoint.com/v2/r06/___http:/www.nwf.co.uk/___.ZXV3MjpuZXh0MTU6YzpvOjljOGNhNzE4NzYyOGNiN2E4YjJmZGY2ZWRkZmRhZWE1Ojc6YTNjYzo2ODcxYjJiODdmYTg1ODI0NWFjN2Y3Yzk5NzBmOTQ5ZTA1YzU4NGI0OThlYjBmNjE0MWNjODAwODUxOWFjNWQxOnA6RjpU)
.
Chris Belsham, Chief Executive Officer Reg Hoare Mike Bell
Katie Shortland, Chief Financial Officer Veronica Farah Ed Allsopp
MHP Communications
NWF Group plc
Tel: 07711 191 518 Peel Hunt LLP (Nominated advisor and broker)
Tel: 01829 260 260
Tel: 020 7418 8900
Chair's statement
The first half of the year delivered encouraging year-on-year growth in
overall profitability, with the Group trading in line with Board expectations.
In Fuels, volumes were flat, but margins improved and the business benefitted
from a reduction in its cost base following strong cost management decisions
taken early in the period. In Food, the start-up costs of Lymedale meant the
headline operating profit contribution was lower than the prior year. Feeds
volumes increased ahead of growth in the overall market with an improving milk
price encouraging customers to increase production. Raw material prices
continued to be very stable which supported effective margin management.
Results
Revenue for the half year ended 30 November 2024 was 3.9% lower at £454.3
million (H1 2023: £472.9 million), primarily as a result of the lower oil
price in Fuels. Headline operating profit 1 (#_ftn1) was higher at £5.0
million (H1 2023: £4.0 million), with margin improvement driven by the
performance in Fuels and Feeds. Headline profit before taxation 1 was up 5.9%
to £3.6 million (H1 2023: £3.4 million) adjusting for exceptional costs of
£1.1 million in the period.
Diluted headline earnings per share 1 was 5.5p (H1 2023: 5.1p).
Net cash generated from operations for the period amounted to £10.8 million
(H1 2023: £9.0 million). Cash generation was higher due to customer mix and
timing of supplier payments. Net capital expenditure in the period was £3.0
million (H1 2023: £1.6 million), the increase relating to completion of
Lymedale and product growth in Feeds.
Net cash at the period end, excluding the impact of IFRS 16, was strong at
£11.4 million (H1 2023: £13.3 million; FY 2023: £10.0 million).
The Group's banking facilities of £61.0 million were extended in the period
and are now committed to May 2028. NWF continues to operate with substantial
headroom. Net debt including IFRS 16 lease liabilities was £39.1 million (H1
2023: £14.3 million), reflecting the addition of the Lymedale warehouse lease
as well as the increased fleet size.
Net assets at 30 November 2024 increased to £86.4 million (30 November 2023:
£79.6 million). The IAS 19R defined benefits pension scheme valuation deficit
has decreased from £4.5 million as at 31 May 2024 to £3.7 million at the
half year, as a result of higher asset values offsetting the slight decrease
in the discount rate assumption.
The Board has approved an unchanged interim dividend per share of 1.0p (H1
2023: 1.0p), consistent with its policy. This will be paid on 1 May 2025 to
shareholders on the register as at 21 March 2025. The shares will trade
ex-dividend on 20 March 2025. The Group has increased the annual dividend by
approximately 4% in each of the last 12 years, reflecting the Group's strong
underlying financial performance and position.
Operations
Fuels
Revenue decreased by 9.3% to £312.8 million (H1 2023: £344.8 million) as a
result of the lower oil price offsetting an increase in volumes. Headline
operating profit was £1.7 million (H1 2023: £0.7 million).
Volumes increased slightly by 0.9% to 331 million litres (H1 2023: 328 million
litres). Domestic heating oil volumes were 2% higher. In the first half Brent
Crude averaged $78 per barrel (H1 2023: $84 per barrel) and ended the
reporting period at $73 per barrel. The low volatility in the oil price was
matched by stable supply conditions.
Margins improved over the prior year. Early in the period, the business
undertook strong cost management action to right size the cost base
appropriate to current volumes and margins. As highlighted in the full year
results for the year ended 31 May 2024 the Group is undertaking initiatives to
improve both its commercial and domestic sales models and to optimise fleet
efficiency. These initiatives have progressed well during the period, and we
expect to start to accrue the benefits in the next financial year, commencing
1 June 2025.
The UK fuels distribution market remains highly fragmented, and the Board
believes the opportunity for NWF to expand its depot network, broadening the
customer base and leveraging scale efficiencies, remains significant. Our
pipeline of acquisition opportunities has strengthened in the period. The
Group has a strong and established acquisition and integration track record,
and we remain focused on our aim to consolidate this market.
Food
Revenue increased by 11.1% to £43.9 million (H1 2023: £39.5 million),
reflecting increased capacity with the opening of the Lymedale warehouse.
Headline operating profit was £2.5 million (H1 2023: £2.9 million).
Storage volumes averaged 157,000 spaces (H1 2023: 135,000) and peaked at just
over 167,000 pallet spaces (H1 2023: 141,000). Capacity at the Wardle, Crewe
and Lymedale sites totals 183,000 pallet spaces, meaning Food continues to
grow its pipeline of business to support optimal storage facilities across the
three sites and expects to achieve this by the end of the second half of our
financial year.
Headline Food operating profit in the period was lower than the prior year as
a result of the Lymedale start-up costs. It has also been impacted by: a mix
of higher mobilisation costs associated with optimising customer storage
across the three sites (as a result of Lymedale); customer pipeline
progression; and slower throughput experienced on specific customers.
In its first full financial year of operational activity, the year ending 31
May 2026, Lymedale is expected to deliver additional annualised operating
profits of approximately £2.8 million. As a result of IFRS 16 interest in
respect of the warehouse lease and associated additional leased vehicles, this
will result in incremental annualised headline PBT of approximately £1.2
million in the financial year ending 31 May 2026, increasing to £2.5 million
in the financial year ending 31 May 2035 as the IFRS 16 lease liability
reduces.
Feeds
Revenue increased by 10.2% to £97.6 million (H1 2023: £88.6 million) as
higher volumes offset lower commodity and therefore selling prices in the
period. Headline operating profit was £0.8 million (H1 2023: £0.4 million)
with the business continuing to effectively manage margins and its cost base.
Volumes were 9.3% higher at 246,000 tonnes (H1 2023: 225,000 tonnes),
outperforming the market, noting that DEFRA data indicated the ruminant feed
market was 4.2% higher.
Commodity prices were stable over the period with no supply concerns. The
average milk price over the period was 14.0% higher than the comparative
period and was 46.6p per litre at the end of November (H1 2023: 38.2p per
litre). Milk production was 1.1% higher for the period year-on-year. The
improving milk price has encouraged our farmers to maintain feed usage to
optimise herd performance and increase production.
NWF's operational platform, with key mills close to customers in the northern,
central and southern regions, continues to provide an effective base for
future development. Investment has been made into extending the product range
with the development of a complimentary moist feed product line.
Conflict of interest investigation in the Food business
During the period, the Group uncovered a conflict of interest in relation to a
commercial arrangement, which has since been terminated, for the provision of
transport services including drivers. The individuals linked to the commercial
arrangement are no longer employed by the business. There is also additional
complexity as to the payroll (IR35) tax treatment in relation to those
services. The Board appointed an independent accountancy firm to investigate
this matter, with the costs of the work to date being reported within
exceptional costs incurred in the period. The investigation is ongoing and we
will update shareholders further in our full year results in August 2025, but
at this stage we do not expect this to have a material impact on our headline
performance in the year.
Outlook and future prospects
Following the positive start to the financial year, the Group has continued to
perform as planned since the period end. In Fuels, demand has been variable
with no major increase in demand for heating oil. In Food, the business
continues to bring in additional stock from new and existing customers whilst
optimising its performance. In Feeds, the improving milk price has continued
to support volumes.
With the winter months ongoing, which are typically more material to the
Group's performance, the Board's expectations for the full year are unchanged.
The Group's financial position is strong and we continue to focus on
development opportunities, both organic and through targeted, acquisition
opportunities. This underpins our continued confidence in NWF's growth
potential and future prospects.
I look forward to updating shareholders later this year.
Amanda Burton
Chair
4 February 2025
Condensed consolidated income statement
for the half year ended 30 November 2024 (unaudited)
Note Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Revenue 3 454.3 472.9 950.6
Cost of sales and administrative expenses (450.7) (469.6) (937.6)
Other income 4 - 1.3 1.3
Headline operating profit1 5.0 4.0 14.2
Exceptional income 4 - 1.3 1.3
Exceptional expenses 4 (1.1) (0.4) (0.5)
Amortisation of acquired intangibles (0.3) (0.3) (0.7)
Operating profit 3 3.6 4.6 14.3
Finance costs 5 (1.5) (0.8) (2.1)
Headline profit before taxation1 3.6 3.4 12.5
Exceptional income 4 - 1.3 1.3
Exceptional expenses 4 (1.1) (0.4) (0.5)
Amortisation of acquired intangibles (0.3) (0.3) (0.7)
Net finance cost in respect of the defined benefit pension scheme (0.1) (0.2) (0.4)
Profit before taxation 2.1 3.8 12.2
Income taxation expense 6 (0.5) (1.1) (3.1)
Profit for the period attributable to equity shareholders 1.6 2.7 9.1
Earnings per share (pence)
Basic 7 3.2 5.5 18.4
Diluted 7 3.2 5.5 18.4
Headline earnings per share (pence)1
Basic 7 5.5 5.1 19.2
Diluted 7 5.5 5.1 19.2
1 Headline operating profit is statutory operating profit of £3.6 million
(H1 2023: £4.6 million profit) before exceptional income of £Nil (H1 2023:
£1.3 million), exceptional expenses of £1.1 million (H1 2023: £0.4 million)
and amortisation of acquired intangibles of £0.3 million (H1 2023: £0.3
million). Headline profit before taxation is statutory profit before taxation
of £2.1 million (H1 2023: £3.8 million profit), after adding back the net
finance cost in respect of the Group's defined benefit pension scheme of £0.1
million (H1 2023: £0.2 million), the exceptional items and the amortisation
of acquired intangibles. Headline earnings per share also takes into account
the taxation effect thereon.
The notes form an integral part of this condensed consolidated Half Year
Report.
Condensed consolidated statement of comprehensive income
for the half year ended 30 November 2024 (unaudited)
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Profit for the period attributable to equity shareholders 1.6 2.7 9.1
Items that will not be reclassified to income statement:
Re-measurement (loss)/gain on the defined benefit pension scheme (0.4) (0.2) 3.1
Tax on items that will not be reclassified to income statement (0.2) (0.8) (0.7)
Total comprehensive income for the period 1.0 1.7 11.5
The notes form an integral part of this condensed consolidated Half Year
Report.
Condensed consolidated balance sheet
as at 30 November 2024 (unaudited)
Note 30 November 30 November 31 May
2024 2023 2024
£m £m £m
Non-current assets
Property, plant and equipment 49.3 43.3 49.0
Right of use assets 48.7 26.7 45.9
Intangible assets 32.9 33.6 33.3
130.9 103.6 128.2
Current assets
Inventories 8.7 7.8 8.1
Trade and other receivables 8 97.1 101.2 88.7
Reimbursement assets 2.2 1.4 1.8
Current taxation assets 0.5 0.4 0.6
Cash and cash equivalents 8 11.4 13.3 10.0
Derivative financial instruments 8 0.3 0.2 0.3
120.2 124.3 109.5
Total assets 251.1 227.9 237.7
Current liabilities
Trade and other payables 8 (99.5) (104.6) (91.1)
Current taxation liabilities - - -
Lease liabilities 8 (9.6) (9.5) (8.0)
Provision for liabilities (2.2) (1.7) (1.9)
Derivative financial instruments 8 - (0.1) -
(111.3) (115.9) (101.0)
Non-current liabilities
Lease liabilities 8 (40.9) (18.1) (38.3)
Provision for liabilities (1.5) (0.2) (1.4)
Deferred taxation liabilities (7.3) (5.3) (7.1)
Retirement benefit obligations (3.7) (8.8) (4.5)
(53.4) (32.4) (51.3)
Total liabilities (164.7) (148.3) (152.3)
Net assets 86.4 79.6 85.4
Equity
Share capital 9 12.4 12.4 12.4
Share premium 0.9 0.9 0.9
Retained earnings 73.1 66.3 72.1
Total shareholders' funds 86.4 79.6 85.4
The notes form an integral part of this condensed consolidated Half Year
Report.
Condensed consolidated statement of changes in equity
for the half year ended 30 November 2024 (unaudited)
Share Share Retained Total shareholders'
funds
capital premium earnings
£m
£m £m £m
Balance at 1 June 2023 12.4 0.9 64.6 77.9
Profit for the period attributable to equity shareholders - - 2.7 2.7
Items that will not be reclassified to income statement:
Re-measurement loss on the defined benefit pension scheme - - (0.2) (0.2)
Tax on items that will not be reclassified to income statement - - (0.8) (0.8)
Total other comprehensive income for the period - - 1.7 1.7
Balance at 30 November 2023 12.4 0.9 66.3 79.6
Profit for the period attributable to equity shareholders - - 6.4 6.4
Items that will not be reclassified to income statement:
Re-measurement gain on the defined benefit pension scheme - - 3.3 3.3
Tax on items that will not be reclassified to income statement - - 0.1 0.1
Total other comprehensive income - - 9.8 9.8
Transactions with owners:
Dividends paid - - (3.9) (3.9)
Debit to equity for equity-settled share-based payments - - (0.1) (0.1)
Total transactions with owners - - (4.0) (4.0)
Balance at 31 May 2024 12.4 0.9 72.1 85.4
Profit for the period attributable to equity shareholders - - 1.6 1.6
Items that will not be reclassified to income statement:
Re-measurement loss on the defined benefit pension scheme - - (0.4) (0.4)
Tax on items that will not be reclassified to income statement - - (0.2) (0.2)
Total other comprehensive income for the period - - 1.0 1.0
Transactions with owners:
Dividends paid - - - -
Credit to equity for equity-settled share-based payments - - - -
Total transactions with owners - - 73.1 86.4
Balance at 30 November 2024 12.4 0.9 73.1 86.4
The notes form an integral part of this condensed consolidated Half Year
Report.
Condensed consolidated cash flow statement
for the half year ended 30 November 2024 (unaudited)
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Cash flows from operating activities
Operating profit 3.6 4.6 14.3
Adjustments for:
Depreciation - property, plant and equipment 2.8 2.5 5.0
Depreciation - right of use assets 6.2 5.3 11.2
Amortisation of other intangible assets 0.4 0.3 0.9
Profit on disposal of fixed assets (0.3) (0.1) (0.3)
Fair value profit on financial derivative - - (0.2)
Share-based payment expense - - (0.1)
Contributions to pension scheme not recognised in income statement (1.3) (1.2) (2.5)
Operating cash flows before movements in working capital 11.4 11.4 28.3
Movements in working capital:
Increase in inventories (0.6) (0.4) (0.7)
Increase in receivables (8.4) (12.2) (0.9)
Increase/(decrease) in payables 8.4 10.2 (1.4)
Net cash generated from operations 10.8 9.0 25.3
Net interest paid - borrowings and overdrafts (0.2) (0.2) (0.4)
Interest paid - lease liabilities (0.6) (0.4) (1.3)
Income taxation paid (0.4) (2.0) (2.7)
Net cash generated from operating activities 9.6 6.4 20.9
Cash flows from investing activities
Purchase of property, plant and equipment (3.4) (2.0) (10.3)
Capitalised costs associated with leases - - (1.1)
Acquisition of subsidiaries - cash paid (net of cash acquired) - (2.6) (2.6)
Proceeds on sale of property, plant and equipment 0.4 0.4 0.6
Net cash absorbed by investing activities (3.0) (4.2) (13.4)
Cash flows from financing activities
Capital element of leases (5.2) (5.2) (9.9)
Dividends paid - - (3.9)
Net cash absorbed by financing activities (5.2) (5.2) (13.8)
Net movement in cash and cash equivalents 1.4 (3.0) (6.3)
Cash and cash equivalents at beginning of period 10.0 16.3 16.3
Cash and cash equivalents at end of period 11.4 13.3 10.0
The notes form an integral part of this condensed consolidated Half Year
Report.
Notes to the condensed consolidated Half Year Report
for the half year ended 30 November 2024 (unaudited)
1. General information
NWF Group plc ('the Company') is a public limited company incorporated and
domiciled in England, United Kingdom, under the Companies Act 2006. The
principal activities of NWF Group plc and its subsidiaries (together 'the
Group') are the sale and distribution of fuel oils, the warehousing and
distribution of ambient groceries and the manufacture and sale of animal
feeds. The address of its registered office is NWF Group plc, Wardle,
Nantwich, Cheshire CW5 6BP.
The Company has its primary listing on AIM, part of the London Stock Exchange.
These condensed consolidated interim financial statements ('interim financial
statements') were approved by the Board for issue on 4 February 2025.
These interim financial statements do not constitute statutory accounts within
the meaning of Section 434 of the Companies Act 2006. The interim financial
statements for the half years ended 30 November 2024 and 30 November 2023 are
neither audited nor reviewed by the Company's auditors. Statutory accounts for
the year ended 31 May 2024 were approved by the Board of Directors on 30 July
2024 and delivered to the Registrar of Companies. The report of the auditors
on those accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statement under Section 498 of the Companies
Act 2006.
2. Basis of preparation and accounting policies
Except as described below, these interim financial statements have been
prepared in accordance with the principal accounting policies used in the
Group's consolidated financial statements for the year ended 31 May 2024.
These interim financial statements should be read in conjunction with those
consolidated financial statements, which have been prepared in accordance with
the international accounting standards in conformity with the requirements of
the Companies Act 2006 and the UK-adopted International Accounting Standards
('IFRS').
These interim financial statements do not fully comply with IAS 34 'Interim
Financial Reporting', as is currently permissible under the rules of AIM.
Taxes on income in the interim periods are accrued using the tax rate that
would be applicable to expected total annual earnings.
The triennial actuarial valuation of the Group's defined benefit pension
scheme was completed in the year ended 31 May 2024, with a deficit of £7.6
million at the valuation date of 31 December 2022. The present value of the
defined benefit obligation and the related current service cost were measured
using the Projected Unit Credit Method. In these interim financial statements,
this liability has been updated in order to derive the IAS 19R valuation as of
30 November 2024. The triennial valuation resulted in Group contributions of
£2.1 million per annum. In addition, a continued percentage increase based on
total dividend growth over £3.1 million will be paid.
The Directors consider that headline EBITDA, headline operating profit,
headline profit before taxation and headline earnings per share, referred to
in these interim financial statements, provide useful information for
shareholders on underlying trends and performance, these metrics constitute
the Group's Alternative Performance Measures ('APMs').
Headline operating profit is reported operating profit after adding back
exceptional items and amortisation of acquired intangibles. Headline profit
before taxation is reported profit before taxation, after adding back the net
finance cost in respect of the Group's defined benefit pension scheme,
amortisation of acquired intangibles, exceptional items and the taxation
effect thereon where relevant. Headline EBITDA refers to reported operating
profit after adding back exceptional items and amortisation of acquired
intangibles. The headline EBITDA calculation excludes the impact of IFRS 16
depreciation.
The calculation of headline earnings includes any exceptional impact of
remeasuring deferred taxation balances. The calculations of basic and diluted
headline earnings per share are shown in note 7 of these interim financial
statements.
The Group's income statement separately identifies exceptional items. Such
items are those that, in the Directors' judgement, are one-off in nature or
non-operating and need to be disclosed separately by virtue of their size or
incidence and may include, but are not limited to, restructuring costs,
acquisition-related costs, costs of implementing new systems, asset impairment
and income from legal and insurance settlements. In determining whether an
item should be disclosed as an exceptional item, the Directors consider
qualitative as well as quantitative factors such as the frequency,
predictability of occurrence and significance. This is consistent with the way
financial performance is measured by management and reported to the Board.
Disclosing exceptional items separately provides additional understanding of
the performance of the Group.
The Group tests annually for impairment or if there is any indication that an
asset may be impaired. This involves using key judgements including estimates
of future business performance and cash generation, discount rates and
long‑term growth rates.
Certain statements in these interim financial statements are forward looking.
The terms 'expect', 'anticipate', 'should be', 'will be' and similar
expressions identify forward-looking statements. Although the Board of
Directors believes that the expectations reflected in these forward-looking
statements are reasonable, such statements are subject to a number of risks
and uncertainties and actual results and events could differ materially from
those expressed or implied by these forward-looking statements.
Based on financial performance to date and forecasts along with the available
banking facilities, there is a reasonable expectation that the Group has
adequate resources to continue in operational existence for the foreseeable
future. The Group therefore continues to adopt the going concern basis of
accounting in preparing the annual financial statements.
The Board has prepared cash flow forecasts for the period to 31 May 2026.
Under this base case scenario, the Group is expected to continue to have
significant headroom relative to the funding available to it and to comply
with its banking covenants.
The Board has also considered a severe downside scenario based on a
significant and sustained reduction in Fuels' profitability alongside
underperformance in Food and Feeds. This downside scenario excludes any
mitigating actions that the Board would be able to take to reduce costs. Under
this scenario, the Group would still expect to have sufficient headroom in its
financing facilities.
Accordingly, the Directors, having made suitable enquiries, and based on
financial performance to date and forecasts along with the available banking
facilities, have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future. The
Group therefore continues to adopt the going concern basis of accounting in
preparing the annual financial statements.
3. Segment information
The chief operating decision-maker has been identified as the Board of
Directors ('the Board'). The Board reviews the Group's internal reporting in
order to assess performance and allocate resources. The Board has determined
that the operating segments, based on these reports, are Fuels, Food and
Feeds.
The Board considers the business from a product/services perspective. In the
Board's opinion, all of the Group's operations are carried out in the same
geographical segment, namely the UK.
The nature of the products/services provided by the operating segments are
summarised below:
Fuels - sale and distribution of domestic heating and
industrial and road fuels
Food - warehousing and distribution of clients' ambient
groceries and other products to supermarket and other retail distribution
centres
Feeds - manufacture and sale of animal feeds and other
agricultural products
Segment information about the above businesses is presented below.
The Board assesses the performance of the operating segments based on a
measure of headline operating profit. Finance income and costs are not
included in the segment result that is assessed by the Board. Other
information provided to the Board is measured in a manner consistent with that
in the financial statements.
Inter-segment transactions are entered into under the normal commercial terms
and conditions that would also be available to unrelated third parties.
Segment assets exclude current taxation assets and cash and cash equivalents.
Segment liabilities exclude deferred taxation liabilities, borrowings and
retirement benefit obligations. Excluded items are part of the reconciliation
to consolidated total assets and liabilities.
Half year ended 30 November 2024 (unaudited) Note Fuels Food Feeds Group
£m £m £m £m
Revenue
Total revenue 316.5 44.0 97.6 458.1
Inter-segment revenue (3.7) (0.1) - (3.8)
Revenue 312.8 43.9 97.6 454.3
Result
Headline operating profit 1.7 2.5 0.8 5.0
Exceptional expenses - - - (1.1)
Amortisation of acquired intangibles (0.3) - - (0.3)
Operating profit as reported 3.6
Finance costs 5 (1.5)
Profit before taxation 2.1
Income taxation expense 6 (0.5)
Profit for the period 1.6
Other information
Depreciation and amortisation 2.8 4.9 1.7 9.4
Property, plant and equipment additions 0.6 2.0 0.8 3.4
As at 30 November 2024 Fuels Food Feeds Group
£m £m £m £m
Balance sheet
Assets
Segment assets 101.9 81.5 55.8 239.2
Cash and cash equivalents 11.4
Current taxation receivable 0.5
Consolidated total assets 251.1
Liabilities
Segment liabilities (80.5) (47.6) (25.6) (153.7)
Deferred taxation liabilities (7.3)
Retirement benefit obligations (3.7)
Consolidated total liabilities (164.7)
Half year ended 30 November 2023 Note Fuels Food Feeds Group
£m £m £m £m
Revenue
Total revenue 348.3 39.5 88.6 476.4
Inter-segment revenue (3.5) - - (3.5)
Revenue 344.8 39.5 88.6 472.9
Result
Headline operating profit 0.7 2.9 0.4 4.0
Exceptional income - - - 1.3
Exceptional expenses (0.4)
Amortisation of acquired intangibles (0.3) - - (0.3)
Operating profit as reported 4.6
Finance costs 5 (0.8)
Profit before taxation 3.8
Income taxation expense 6 (1.1)
Profit for the period 2.7
Other information
Depreciation and amortisation 3.2 3.3 1.6 8.1
Property, plant and equipment additions 0.7 0.4 0.9 2.0
As at 30 November 2023 Fuels Food Feeds Group
£m £m £m £m
Balance sheet
Assets
Segment assets 113.4 51.5 49.3 214.2
Cash and cash equivalents 13.3
Current taxation receivable 0.4
Consolidated total assets 227.9
Liabilities
Segment liabilities (90.9) (24.5) (18.8) (134.2)
Deferred taxation liabilities (5.3)
Retirement benefit obligations (8.8)
Consolidated total liabilities 148.3
Year ended 31 May 2024 Fuels Food Feeds Group
Note £m £m £m £m
Revenue
Total revenue 684.9 77.8 195.1 957.8
Inter-segment revenue (7.1) (0.1) - (7.2)
Revenue 677.8 77.7 195.1 950.6
Result
Headline operating profit 7.9 3.7 2.6 14.2
Amortisation of acquired intangibles (0.7) - - (0.7)
Exceptional income 1.3
Exceptional expenses (0.5)
Operating profit as reported 14.3
Finance costs 5 (2.1)
Profit before taxation 12.2
Income taxation expense 6 (3.1)
Profit for the year 9.1
Other information
Depreciation and amortisation 6.4 7.5 3.2 17.1
Property, plant and equipment additions 1.7 6.9 1.7 10.3
As at 31 May 2024 Fuels Food Feeds Group
£m £m £m £m
Balance sheet
Assets
Segment assets 99.6 76.8 51.3 227.7
Cash and cash equivalents 10.0
Consolidated total assets 237.7
Liabilities
Segment liabilities (71.6) (44.4) (24.7) (140.7)
Deferred taxation liabilities (7.1)
Retirement benefit obligations (4.5)
Consolidated total liabilities (152.3)
4. Profit before taxation - exceptional items
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Legal claim settlement1 - 1.3 1.3
ERP implementation costs2 (0.1) (0.4) (0.5)
Restructure costs3 (0.4) - -
Investigation costs4 (0.6) - -
Exceptional costs (1.1) 0.9 0.8
1 Following a decision by the European Commission sanctioning a cartel
during the period 1997 to 2011, NWF participated in a group action to recover
damages arising from certain supplier expenses relating to that period. The
parties are no longer in dispute regarding this matter. Settlement monies of
£1.3 million were received.
2 ERP implementation costs comprise initial preliminary appraisals relating
to future ERP implementation within the Group.
3 Restructure costs relate to optimising the commercial and operational
business model within the Fuels business.
4 Following a report of a conflict of interest in a commercial arrangement
within the Food business, costs have been incurred to investigate the issue.
5. Finance costs
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Interest on bank loans and overdrafts 0.2 0.2 0.4
Finance costs on lease liabilities relating to IFRS 16 1.2 0.4 1.3
Interest on the net defined benefit liability 0.1 0.2 0.4
Total finance costs 1.5 0.8 2.1
6. Income taxation expense
The income taxation expense for the half year ended 30 November 2024 is based
upon management's best estimate of the weighted average annual tax rate
expected for the full financial year ending 31 May 2025 of 25.0% (2024: 27%).
7. Earnings per share
The calculation of basic and diluted earnings per share is based on the
following data:
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Earnings
Earnings for the purposes of basic and diluted earnings per share, being 1.6 2.7 9.1
profit for the period attributable to equity shareholders
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
'000 '000 '000
Number of shares
Weighted average number of shares for the purposes of basic earnings per share 49,444 49,411 49,426
Weighted average dilutive effect of conditional share awards (note 9) 6 21 13
Weighted average number of shares for the purposes of diluted earnings per 49,450 49,432 49,439
share
The calculation of basic and diluted headline earnings per share is based on
the following data:
Half year Half year Year
ended ended ended
30 November 30 November 31 May
2024 2023 2024
£m £m £m
Profit for the period attributable to equity shareholders 1.6 2.7 9.1
Add back/(deduct):
Interest on the net defined benefit liability 0.1 0.2 0.4
Net exceptional items 1.1 (0.9) (0.8)
Amortisation of acquired intangibles 0.3 0.3 0.7
Tax effect of the above (0.4) 0.2 0.1
Headline earnings 2.7 2.5 9.5
8. Financial instruments
The Group's financial instruments comprise cash, bank overdrafts, invoice
discounting advances, rolling credit facilities, lease liabilities, commodity
derivatives and various items such as receivables and payables which arise
from its operations. All financial instruments in 2024 and 2023 were
denominated in Sterling. There is no material foreign exchange risk in respect
of these instruments.
The carrying amounts of all of the Group's financial instruments are measured
at amortised cost in the financial statements, with the exception of
derivative financial instruments. Derivative financial instruments are
measured at fair value subsequent to initial recognition.
IFRS 13 (amended) 'Financial Instruments: Disclosures' requires disclosure of
financial instruments measured at fair value, grouped into Levels 1 to 3
below, based on the degree to which the fair value is observable:
• Level 1 fair value measurements are those derived from unadjusted
quoted prices in active markets for identical assets or liabilities;
• Level 2 fair value measurements are those derived from inputs, other
than quoted prices included within Level 1 above, that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices); and
• Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
All of the Group's derivative financial instruments were classified as Level 2
in the current and prior periods. There were no transfers between levels in
both the current and prior periods.
The book, fair value and interest rate profile of the Group's financial assets
are as follows:
Total book and fair value 30 November 30 November 31 May
2024 2023 2024
£m £m £m
Trade and other receivables1 87.3 92.6 83.3
Financial assets carried at amortised cost: cash and cash equivalents 11.4 13.3 10.0
Financial assets carried at fair value: derivatives 0.3 0.2 0.3
Financial assets 99.0 106.1 93.6
1 Excludes prepayments.
The book and fair values of financial liabilities are as follows:
Total book and fair value 30 November 30 November 31 May
2024 2023 2024
£m £m £m
Financial liabilities carried at amortised cost:
Trade and other payables1 97.9 103.2 89.6
Lease liabilities repayable within one year 9.6 9.5 8.0
Financial liabilities carried at fair value: derivatives - 0.1 -
107.5 112.8 97.6
Lease liabilities repayable after one year 40.9 18.1 38.3
Financial liabilities 148.4 130.9 135.9
1 Excludes social security and other taxes.
9. Share capital
Number Total
of shares £m
'000
Allotted and fully paid: ordinary shares of 25p each
Balance at 1 June 2023 49,408 12.4
Issue of shares (see below) 24 -
Balance at 30 November 2023 49,432 12.4
Issue of shares 7 -
Balance at 31 May 2024 49,439 12.4
Issue of shares (see below) 11 -
Balance at 30 November 2024 49,450 12.4
During the half year ended 30 November 2024, 10,969 shares (H1 2023: 23,564)
with an aggregate nominal value of £2,742 (H1 2023: £5,890) were issued
under the Company's conditional Performance Share Plan.
The maximum total number of ordinary shares that may vest in the future in
respect of conditional Performance Share Plan awards outstanding at 30
November 2024 amounted to 1,531,660 (H1 2023: 1,291,025) shares. These shares
will only be issued subject to satisfying certain performance criteria.
2025 financial calendar
Interim dividend paid
1 May 2025
Financial year end
31 May 2025
Full year results announcement 29 July 2025
Publication of Annual Report and Accounts Late August 2025
Annual General Meeting 16
September 2025
Final dividend paid
Early December 2025
1 (#_ftnref1) Headline operating profit excludes exceptional items
(see note 4) and amortisation of acquired intangibles. Headline profit before
taxation excludes exceptional items, amortisation of acquired intangibles and
the net finance cost in respect of the Group's defined benefit pension scheme.
Diluted headline earnings per share also takes into account the taxation
effect thereon.
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