25th Jan 2010 07:00
BEALE PLC
25 January 2010
Beale PLC, the specialist department store operator, announces Preliminary Results for the 52 weeks ended 31 October 2009 (comparative period - 52 weeks ended 1 November 2008).
Mike Killingley, Chairman, commented: "We expect 2010 to be another challenging year for retailers, as continuing high unemployment and increasing taxation levels affect both spending power and consumer confidence, with the added political uncertainty of a general election this spring.
Despite this environment, we believe that the trading strategy being led by Tony Brown and his team will continue the positive trend of 2008/09, so that we will see further improvement in the performance of Beales over the coming year."
Tony Brown, Chief Executive noted: "Whilst losses are never desirable to report, despite the backdrop of the recession we have managed to significantly reduce our losses. We will continue with the strategy employed in 2009 through 2010, which I believe will be another challenging year for retailers. We have set ourselves the target of significantly reducing our losses again and I am confident that we will achieve this objective despite the adverse economic environment.
Your Board will work hard to continue the improvement in results achieved in 2008/9 into next year with the ultimate objective of returning the Company to profitability."
For further information:
|
Beale PLC |
Astaire Securities |
|
|
Tony Brown, Chief Executive |
Lindsay Mair / Toby Gibbs |
|
|
Ken Owst, Finance Director |
||
|
Tel: 01202 552022 |
Tel: 020 7448 4400 |
Chairman's Statement
Results
The Group loss before tax of £0.99 million for the 52 weeks ended 31 October 2009 was a marked improvement on the prior year, during which we incurred a loss of £1.52 million, and in line with our expectations. It is, of course, not enough, and we remain focused on restoring the Group to profitability at the earliest opportunity.
Gross sales excluding VAT but including concessions were 2.8% below those of the previous year. However, VAT was 15% for 11 months of our trading year, a reduction from the previous rate of 17.5%; resulting in total like for like gross sales including concessions being 4.5% below the previous year.
Like for like Group revenue declined by only 0.7% at £47.6 million (2008: £47.9 million). The smaller percentage decline compared with gross sales reflects the lower percentage of concessions in the sales mix, as we continue to place greater emphasis on improving the quality and range of our own bought merchandise, including our new Home Basics and Crimson ranges.
There have been numerous developments in our concession partners too: as reported at the half year, we have had to replace a number of brands which have ceased to trade, and this has been successfully achieved. Tony Brown reports on this in his Chief Executive's Statement, where he also discusses more fully our trading performance and developments in our strategy.
Gross margin declined slightly, from 54.9% to 54.5%. The promotional strategy which we have developed over the past 18 months has been essential to enable us, when necessary, to compete aggressively in a very price sensitive and bargain conscious environment. Critical to this has been the marked improvement in buying-in margins, which enhances our ability to be competitive without threatening our margins.
We reduced administrative expenses again, by £0.8 million, as we continue to maintain our focus on cost control.
Effective working capital management enabled us to reduce net debt by £1.4 million, after capital expenditure of £1.1 million.
Our financial results, balance sheet and working capital performance are addressed more fully in Ken Owst's Finance Director's Review.
Trading update
Like for like sales, excluding VAT, during the key 5 week Christmas trading period ending on 2 January 2010, were 2.8% above those of the previous year.
The first 2 months of the 2010 financial year have been more profitable than the same period last year, because of higher margins generated by our buying strategy and continued progress in expense reduction.
Sales for the first two weeks of January have been adversely affected by snow. The areas in which our stores are situated, principally the south, south-east and north-west of the country were disproportionately affected. For the first 11 weeks of the current financial year (to 16 January 2010) sales excluding VAT were 3.4% below those for the previous year.
Dividend
No dividend is proposed.
Chairman's Statement continued
Board
Barbara King, buying and merchandising director, left the Company at the end of December 2009. We are in the process of recruiting a new head of buying and merchandising. I would like to thank Barbara for her contribution to the Group over the last 4 years and wish her every success in the future.
Staff
Our staff have continued to work tirelessly in challenging trading conditions. On behalf of the Board and shareholders I thank them for their exceptional contribution.
Banking facilities and going concern
Last year the volatility in the banking sector was a cause of concern throughout the economy; stability is now returning. Despite this volatility we renegotiated our bank facilities in February 2009 to provide a £9 million term loan facility, repayable in February 2011, in addition to a modest overdraft facility, repayable on demand. The bank facilities are secured against the Group's freehold properties.
We have continued to trade comfortably within our facilities throughout the past year, and have met all our banking covenants.
Tony Brown has set out the Group's trading strategy in his Chief Executive's Statement; this focuses on:
a strong improvement in buying-in margins;
our new own bought fashion and homewares ranges;
strong new brands;
quality of service; and
continued cost control.
The progress which has been made to date gives us confidence that we shall continue to improve our performance in the current year despite the continuing difficult economic conditions. Our forecasts show that the Group will be able to operate within its borrowing facilities and comply with its banking covenants and the Board has therefore continued to adopt the going concern basis in preparing the annual report and accounts.
Outlook
We expect 2010 to be another challenging year for retailers, as continuing high unemployment and increasing taxation levels affect both spending power and consumer confidence, with the added political uncertainty of a general election this spring.
Despite this environment, we believe that the trading strategy being led by Tony Brown and his team will continue the positive trend of 2008/09, so that we will see further improvement in the performance of Beales over the coming year.
Mike Killingley
Chairman
Chief Executive's Statement
Introduction
I reported in last year's Accounts that the business was trading in the most challenging of retail environments. This continued throughout 2009 with sadly even more names disappearing from the high street. I also reported that we were not immune from the recession's effects and that the strategy we were employing as part of the turnaround should help support the Group through these difficult times. Whilst losses are never desirable to report, despite the backdrop of the recession we have managed to significantly reduce our losses. We will continue with the strategy employed in 2009 through 2010, which I believe will be another challenging year for retailers. We have set ourselves the target of significantly reducing our losses again and I am confident that we will achieve this objective despite the adverse economic environment.
Buying in margin
Our buying in margins have continued to improve and we have seen our achieved margins starting to reflect this increase. It should be noted that achieved margins take significantly longer to filter through than the buying in margin due to the backlog of lower margin purchases within our stock profile. We have achieved these increases through a rigorous review of our own bought product mix, supplier base, trading terms, concession mix and a commercial approach to stock management. Through consistently applying this strategy, I believe we will continue to improve our margins and to reduce our stock levels. We will continue our policy of purchasing in bulk from the Far East and reducing our supplier base so we become more important to our current suppliers and are able to achieve better trading terms.
Sales
We continue with our sales and promotional strategy featuring quality brands at great prices. This approach is still proving to be very popular with our customers. Our promotional calendar continues to give customers new and exciting monthly promotions on top brands across the whole store. We continue our promotional strategy on furniture, which is proving very successful and we have seen our furniture sales grow in a marketplace that has reduced in the past year. We have supported our sales strategy with a far more aggressive marketing campaign focusing on our local strategic importance to the towns in which we trade through our 'Love Beales' campaign.
Whilst we continue to maintain our core business and improve our promotional and pricing strategy, we have also embarked on a number of new initiatives. Shareholders will remember last year that we announced the launch of our Salt & Pepper range which continues in our Horsham and Worthing stores and has recently been introduced into our Bournemouth store. During the last year we have introduced a number of new concepts, including Home Basics, which is an own bought homewares range offering outstanding value, and Crimson, which is an own bought core fashion range. We have also introduced Mamas & Papas babywear and accessories and Joules, the clothing brand, to a number of stores and most prominent of our new entrants is the George Davies range, GIVe, which has made a very encouraging start in its first season.
Service and People
Customer service is pivotal to our proposition and a core value of ours. We have invested time, energy and money in training programmes aimed at improving our customer service levels. We continue to invest in our stores to improve the customer experience whilst shopping with us and our ambition continues to be to deliver service that our customers simply can't get anywhere else. The board thanks all of our staff for their hard work and contribution throughout the year.
Chief Executive's Statement continued
Cost Controls
We continue to challenge ourselves in all our cost areas and it remains uppermost in our minds whilst ensuring that we balance this with maintaining our service levels, sales drive and operating systems and central support. We will continue to look for cost savings throughout the coming year.
Principal risks and uncertainties
As previously noted, all retailers face a very challenging and competitive trading environment. The greatest risk to our business continues to be a sustained economic downturn with the need for increased discounting and promotions to drive sales. This has been a major feature of the 2008/2009 trading year and we have succeeded in driving our sales whilst at the same time maintaining good margins. In an environment where achieving sales increase is an ongoing challenge, it is also of major importance that costs are stringently controlled. The Company continues to manage these risks by:
Balancing concession and own bought merchandise
Ensuring that challenging cost saving targets are achieved
Implementation of the Group Corporate Plan
Focusing on improvement in our product ranges, maximising margins from direct Far East sourcing whilst managing the impact of the decline in Sterling against the Dollar and the Euro
Full integration of the new management accounting systems, which will ensure, inter alia, improved stock control and replenishment
Regular monitoring of strategic key performance indicators
We continue to work within our banking facilities and covenants.
Environment
We believe in working with and supporting the communities in which we operate and we are closely involved with the town centre and councils in many of the towns in which we trade. We continue to seek ways to reduce product packaging and bag usage in addition to increasing the recycling of cardboard, plastic and other waste. We also continue to pay particular attention to reducing the environmental impact of the Group's carrier bags and with assistance from the Carbon Trust seek opportunities for greater energy efficiency in our stores, service buildings and offices. In 2011 new carbon limits will be placed on all businesses in the UK, this requires us to monitor our usage in 2010 and report in 2011. We are implementing a strategy to reduce our carbon footprint and reduce any increased payments we may have to make under this new legislation.
Outlook and Summary
Since my last statement, the economic outlook has been reported to have stabilised, with the volatility in the banking sector subsiding. We are seeing some signs of this but the economy remains unmistakably subdued. The fear of unemployment, higher prices and interest rates and increased levels of tax will, in my view, continue to make our customers cautious throughout the coming year. Our increased focus on purchasing from the Far East has assisted us to date in achieving increases in our input margins; however, the euro/sterling exchange rate continues to be disadvantageous to us and I cannot see this improving in the near term. Our pricing and buying strategies are designed to ensure that our margins are protected from currency fluctuations. Our balance sheet remains strong, despite an increase in the pension deficit caused by variations in market conditions. Our strategies are rigorously focused on improving our business and we continue to enjoy a strong and healthy relationship with our bank, HSBC. The Board will work hard to continue the improvement in results achieved in 2008/9 into next year with the ultimate objective of returning the Company to profitability.
Tony Brown
Chief Executive
Finance Director's Review
Results
The revenue for the Group for the 52 weeks ended 31 October 2009 was £47.6m being just 0.6% below the previous year (2008: £47.9m). This is a realistic like for like comparison as there was no variation in the overall trading space utilised from the previous 52 week period. It should be noted that own bought sales in the year increased by 0.5%, while concession sales declined by 6.4% as a result of a number of high profile concessions entering administration in Spring 2009. Note 2 of the financial statements identifies that the reduction in the VAT rate to 15.0% (2008: 17.5%) on 1 December 2008 also had an adverse impact on the Group's comparison of gross sales including VAT and concessions, which were £85.0m being 4.5% below the previous period of £89.0m.
In addition to the own bought sales increase, the own bought achieved margin for the year improved slightly to 45.5% (2008: 45.4%). This has been achieved despite heavy promotional activity during the year and also when inventory levels for the Group have been reduced by £0.2m, 2.5% below previous year. Considerable work has been focused on improving the Group buying in margins to deliver this result and in order to negate the increase in VAT imposed from 1 January 2010. However as a result of the reduction in participation of concession sales, the total gross profit for the year of £25.9m (2008: £26.3m) was achieved at a margin of 54.5% (2008: 54.9%).
The Group has continued to maintain a close focus on seeking to reduce administrative expenses. The total expenses for the year of £26.7m are 2.9% lower than the previous year (2008: £27.5m). During the year the Group has also absorbed considerable costs incurred on professional fees. Also the net cost of financing at £230,000 (2008: £296,000) fell due to reduced interest rates in the year.
The resulting loss on ordinary activities before taxation of £987,000 (2008: £1,522,000) was a reduction of 35.2% from the previous period, which was better than market expectation set earlier in the year and ensured the Group operated comfortably within the banking facilities. This performance is particularly encouraging when the year ended 2009 has been widely acknowledged as being the worst for retail in the decade.
Taxation
The tax credit for the year was £70,000 (2008: £131,000 credit) relating to the reduction in deferred tax provisions due to the losses in the year. The Group has re-estimated the deferred tax liability relating to revalued land and has reduced the deferred tax liability by £1.2 million which has been recorded in the statement of recognised income and expenses.
The loss for the period after taxation was £917,000 (2008: £1,391,000 loss), a reduction of 34.1%.
Earnings per share
The adverse trading performance resulted in a loss per share of 4.47p (2008: 6.78p loss). No dividends were paid during the year (2008: nil per share). The Board considers that a significant trading improvement will be necessary before further dividends are paid.
Accounting policies and standards
No new accounting standards have been adopted during the period.
Pensions
The Group offers new employees the opportunity to join the Beales defined contribution pension scheme. During April 2009 the Group closed the Beales defined
Finance Director's Review continued
benefit pension scheme to future accrual having been closed to new entrants in April 1997 and operated by the main trading subsidiary of J E Beale plc. J E Beale plc also has responsibility for the Denners' pension scheme, which was closed to new members and future accrual when Denners Limited was acquired by the Group in 1999. The net liability for both schemes will remain on balance sheet.
The Group's total final salary pension liability under IAS 19 at the year-end increased to £4.5m (2008: £1.4m). The total actuarial losses for the period were £3.8m (2008: £0.4m loss). The Beales scheme has an IAS 19 deficit of £4.8m (2008: £1.7m deficit). The Denners scheme has an IAS 19 surplus of £0.3m (2008: £0.3m surplus).
During the year the Group reached agreement with the Beales scheme trustees regarding the triennial valuation from October 2007. A new schedule of contributions has been put in place; this allowed the Group a contribution holiday for the last six months of the 2008/9 financial year followed by half rate monthly contributions for the first six months of the new financial year. Thereafter the Group will make cash contributions into the scheme of £1.55m per annum inclusive of pension expenses. This replaces the previous schedule of contributions which committed the Group to paying £1.80m per annum inclusive of pension expenses. The Board also agreed that a £6.0m guarantee be provided from Beale plc to support the Beales defined benefit scheme if the obligations to that scheme are not met by J E Beale plc.
The Denners pension scheme triennial valuation for the year-end to October 2008 has also been agreed, with the Group continuing to make contributions of £72,000 per annum as per the previous schedule of contributions.
Group systems
During the year the Group has continued the upgrade of its major systems platform with the implementation of new sales order processing software. This is the final stage of the Group systems transition and provides the platform for future expansion of the Group.
Balance sheet and cash flow
Group capital expenditure in the year was £1.1m (2008: £0.6m) with the major spend relating to refurbishment in stores, predominantly Poole and Yeovil, and the introduction of new George Davies fashion branded GIVe departments across the estate. Two minor freehold properties were disposed of in the year yielding proceeds of £0.3m, which included a profit on disposal of £0.2m.
As noted earlier, inventories valued at cost were reduced by 2.5% to £8.2m (2008: £8.4m). This is the third consecutive year that the Group has reduced inventory levels with stock being 28.8% lower than three years ago. Trade and other receivables were reduced to £4.3m (2008: £4.7m). Trade payables at year-end increased to £5.8m (2008: £4.7m) and accruals and deferred income was £2.9m (2008: £2.6m). These liability increases had a consequential favourable impact on borrowings in the year under review. The Group has continued to ensure that creditor payments have been prioritised in order to benefit from maximum early settlement discount. It is particularly pleasing to see that year-end net debt has been reduced by £1.4m of cash generated during the period.
Group net assets at year-end were £13.8m (2007: £17.4m). The decline being significantly affected by the increase of the pension deficit. Net assets per share at year end were 67.3p (2008: 84.9p).
Treasury and banking
Treasury activities are governed by procedures and policies approved by the Board. The Group's policy is to take a conservative stance on treasury matters and no speculative positions are taken in financial instruments. The treasury function manages the Group's financial resources in the most
Finance Director's Review continued
appropriate and cost-effective manner, minimising the Group's exposure to risk arising from interest rate and foreign exchange fluctuations.
During the year the Group operated within its banking facility, which comprises of a £9.0m two-year term loan which is due to expire in February 2011 and an operating overdraft of £112,000. The Group net debt at year-end was £6.4m (2008: £7.8m). Year end gearing was 46.6% (2008: 44.9%).
As noted in the Chairman's statement, the Group complied with all of its banking covenants during the year despite the difficult trading conditions. In considering going concern the directors have reviewed the latest financial forecasts for the 2010 year against the banking covenants and have applied appropriate sensitivities and mitigating actions to these forecasts which show that none of the covenants are breached for the foreseeable future. Further comment and details are set out in note 7 to the financial statements.
Ken Owst
Finance Director
Responsibility statement of the directors on the annual report
The responsibility statement below has been prepared in connection with the Group's full annual report for the year ending 31 October 2009. Certain parts thereof are not included within this announcement.
We confirm to the best of our knowledge:
The financial statements, prepared in accordance with IFRS as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit or loss of the company and the undertakings included in the consolidation taken as a whole; and
The management report, which is incorporated into the directors' report, includes a fair review of the development and performance of the business and the position of the company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties they face.
This responsibility statement was approved by the board of directors on 22 January 2010 and is signed on its behalf by
Mike Killingley Tony Brown
Chairman Chief Executive
Consolidated Income Statement
For the 52 weeks ended 31 October 2009
|
Notes |
52 weeks to 31 October 2009 £000 |
52 weeks to 1November 2008 £000 |
|
|
Gross sales* |
2 |
84,950 |
88,982 |
|
Revenue - continuing operations |
2 |
47,566 |
47,881 |
|
Cost of sales |
|
(21,655) |
(21,615) |
|
Gross profit |
|
25,911 |
26,266 |
|
Administrative expenses |
|
(26,668) |
(27,492) |
|
Operating loss - continuing operations |
|
(757) |
(1,226) |
|
Finance expense |
|
(231) |
(314) |
|
Finance income |
|
1 |
18 |
|
Loss on ordinary activities before tax |
|
(987) |
(1,522) |
|
Tax |
|
70 |
131 |
|
Loss for the period from continuing operations attributable to equity members of the parent |
|
(917) |
(1,391) |
|
|
|
|
|
|
Basic and diluted loss per share |
3 |
(4.47p) |
(6.78p) |
|
|
|
|
|
* Gross sales reflect revenue from concession sales and VAT from continued operations.
Consolidated Balance Sheet
As at 31 October 2009
|
|
|
31 October
2009
£000
|
1 November
2008
£000
|
|
Non-current assets
|
|
|
|
|
Goodwill
|
|
892
|
892
|
|
Property, plant and equipment
|
|
24,201
|
25,219
|
|
Financial assets
|
|
16
|
16
|
|
|
|
25,109
|
26,127
|
|
Current assets
|
|
|
|
|
Inventories
|
|
8,234
|
8,449
|
|
Trade and other receivables
|
|
4,266
|
4,684
|
|
Cash and cash equivalents
|
|
671
|
76
|
|
|
|
13,171
|
13,209
|
|
Total assets
|
|
38,280
|
39,336
|
|
Current liabilities
|
|
|
|
|
Trade and other payables
|
|
(8,935)
|
(7,484)
|
|
Tax liabilities
|
|
(35)
|
(35)
|
|
Bank overdrafts and loans
|
|
-
|
(2,904)
|
|
|
|
(8,970)
|
(10,423)
|
|
Net current assets
|
|
4,201
|
2,786
|
|
Non-current liabilities
|
|
|
|
|
Bank loan
|
|
(7,100)
|
(5,000)
|
|
Retirement benefit obligations
|
|
(4,533)
|
(1,369)
|
|
Deferred tax liabilities
|
|
(2,893)
|
(4,135)
|
|
Obligations under finance leases
|
|
(979)
|
(978)
|
|
Total liabilities
|
|
(15,505)
(24,475)
|
(11,482)
(21,905)
|
|
Net assets
|
|
13,805
|
17,431
|
|
Equity
|
|
|
|
|
Share capital
|
|
1,026
|
1,026
|
|
Share premium account
|
|
440
|
440
|
|
Revaluation reserve
|
|
8,209
|
7,559
|
|
Capital redemption reserve
|
|
242
|
242
|
|
ESOP reserve
|
|
(27)
|
(27)
|
|
Retained earnings
|
|
3,915
|
8,191
|
|
Total equity
|
|
13,805
|
17,431
|
Consolidated Statement of Recognised Income and Expense
|
|
52 weeks to 31 October 2009 £000 |
52 weeks to 1 November 2008 £000 |
|
|
Actuarial loss on pension scheme |
|
(3,881) |
(385) |
|
Tax on items taken directly to equity |
|
1,172 |
34 |
|
Revaluation of properties |
|
- |
(1,505) |
|
Net loss recognised directly in equity |
|
(2,709) |
(1,856) |
|
Loss for the period |
|
(917) |
(1,391) |
|
Total recognised income and expense for the period |
|
(3,626) |
(3,247) |
Consolidated Reconciliation of Movements in Equity
|
|
52 weeks to 31 October 2009 £000 |
52 weeks to 1 November 2008 £000 |
|
|
Opening equity |
|
17,431 |
20,678 |
|
Total recognised income and expense for the period |
|
(3,626) |
(3,247) |
|
Total movements in equity for the period |
|
(3,626) |
(3,247) |
|
Closing equity |
|
13,805 |
17,431 |
Consolidated Cash Flow Statement
For the 52 weeks ended 31 October 2009
|
Note |
52 weeks to 31 October 2009 £000 |
52 weeks to 1 November 2008 £000 |
|
|
Cash flows from operating activities before interest and tax |
4 |
2,433 |
(1,931) |
|
Interest paid |
|
(253) |
(305) |
|
Interest received |
|
1 |
18 |
|
Tax received |
|
- |
63 |
|
Net cash flow generated from/(used in) operating activities |
|
2,181 |
(2,155) |
|
Cash flows from investing activities |
|
|
|
|
Purchase of property, plant and equipment |
|
(1,115) |
(559) |
|
Proceeds from sale of fixed assets |
|
332 |
- |
|
Net cash used in investing activities |
|
(783) |
(559) |
|
Cash flows from financing activities |
|
|
|
|
New bank loans raised |
|
7,100 |
- |
|
Repayment of bank loans |
|
(7,500) |
2,750 |
|
Net proceeds from obligations under finance leases |
|
1 |
2 |
|
Net cash (used in)/generated from financing activities |
|
(399) |
2,752 |
|
Net increase in cash and cash equivalents in the period |
|
999 |
38 |
|
Cash and cash equivalents (including overdrafts) at beginning of period |
|
(328) |
(366) |
|
Cash and cash equivalents (including overdrafts) at end of period |
|
671 |
(328) |
Notes to the financial statements
|
1 |
Accounting policies |
|
|
General Information |
|
The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 October 2009 or 1 November 2008. The financial information for 2009 and 2008 is derived from the statutory accounts for those years. The statutory accounts for 2008 have been delivered to the Registrar of Companies. The statutory accounts for 2009 will be delivered to the Registrar of Companies following the Company's annual general meeting. The Group auditors, Deloitte LLP, have reported on the 2009 and 2008 accounts, their reports were unqualified and did not contain any statements required under either s237(2) or s237(3) of the Companies Act 1985 or S498(2) or s498(3) of the Companies Act 2006. The 2008 accounts included an emphasis of matter paragraph in relation to material uncertainty, in connection with Going Concern. The preliminary announcement has been prepared on the basis of the accounting policies as stated in the financial statements for the 52 week period ended 31 October 2009. While the information included in this preliminary announcement has been computed in accordance with International Financial Reporting Standards (IRFS), this announcement does not itself contain sufficient information to comply with IRFS. The Company expects to publish full financial statements that comply with IFRS on 16 February 2010.
2 Revenue The entire Group's revenue is derived from retail sales made in the UK. Revenue excludes the non-commission element of sales made by concession outlets.
|
||||||
|
|
||||||
|
|
|
52 weeks to 31 October 2009 £000 |
|
52 weeks to 1 November 2008 £000 |
||
|
Gross sales |
|
84,950 |
|
88,982 |
||
|
VAT |
|
(11,215) |
|
(13,091) |
||
|
Gross sales (exc. VAT) Agency sales less commission |
|
73,735 (26,169) |
|
75,891 (28,010) |
||
|
Revenue |
|
47,566 |
|
47,881 |
||
|
|
Analysis of gross sales (excluding VAT) and revenue: |
||||||
|
|
|
52 weeks to 31 October 2009 |
52 weeks to 1 November 2008
|
||||
|
|
|
Gross sales £000 |
Revenue £000 |
Gross sales £000 |
Revenue £000 |
||
|
|
Own bought sales |
39,312 |
39,312 |
39,115 |
39,115 |
||
|
|
Concession sales |
34,025 |
7,856 |
36,338 |
8,328 |
||
|
|
Interest on customer accounts |
398 |
398 |
438 |
438 |
||
|
|
|
73,735 |
47,566 |
75,891 |
47,881 |
||
|
3 |
Loss per share |
||||
|
|
|
|
52 weeks to 31 October 2009 |
52 weeks to 1 November 2008 |
|
|
|
Weighted average number of shares in issue for the purpose of basic earnings per share |
|
20,524,797 |
20,524,797 |
|
|
|
Dilution - option schemes
|
|
- |
- |
|
|
|
Diluted weighted average number of shares in issue |
|
20,524,797 |
20,524,797 |
|
|
|
|
|
£000 |
£000 |
|
|
|
Loss for basic and diluted earnings per share |
|
(917) |
(1,391) |
|
|
|
|
|
|
|
|
|
|
|
|
Pence |
Pence |
|
|
|
Basic loss per share |
|
(4.47) |
(6.78) |
|
|
|
Diluted loss per share |
|
(4.47) |
(6.78) |
|
|
No dividend was paid (2008: nil per share). |
|
4 |
Reconciliation of operating loss to net cash flow from operating activities
|
||||||
|
|
|
Group |
|
||||
|
|
|
52 weeks to 31 October 2009 £000 |
52 weeks to 1 November 2008 £000 |
|
|
||
|
|
Operating loss |
(757) |
(1,226) |
|
|
||
|
|
Adjustments for: |
|
|
|
|
||
|
|
Cash disbursements of pension obligations (net of charge included within the income statement) |
(717) |
(1,320) |
|
|
||
|
|
Depreciation |
1,972 |
2,235 |
|
|
||
|
|
Profit on fixed asset disposal |
(171) |
- |
|
|
||
|
|
Decrease in inventories |
215 |
1,789 |
|
|
||
|
|
Decrease/(increase) in trade and other receivables |
418 |
1,278 |
|
|
||
|
|
Increase/(decrease) in trade and other payables |
1,473 |
(4,687) |
|
|
||
|
|
Cash generated from/(utilised in) operations |
2,433 |
(1,931) |
|
|
||
5 Analysis of net debt
|
|
|
|||||
|
|
|
1 November 2008 £000 |
Cash flow £000 |
31 October 2009 £000 |
||
|
Cash at bank and in hand Overdraft |
|
76 (404) |
595 404 |
671 - |
||
|
Debt due within one year Debt due after one year
|
|
(328) (2,500) (5,000) |
999 2,500 (2,100) |
671 - (7,100) |
||
|
|
|
(7,828) |
1,399 |
(6,429) |
||
|
Finance lease* |
|
(978) |
(1) |
(979) |
||
|
6 |
Report and Accounts |
|
|
|
|
|
Copies of the Company's Annual Report and Accounts will be sent to shareholders in due course. Further copies may be obtained from the company secretary, Beale PLC, The Granville Chambers, 21 Richmond Hill, Bournemouth BH2 6BJ. |
|
|
|
|
7 |
Going Concern |
|
|
|
|
|
Details of the Group's operations together with its performance in the past year and the factors likely to affect its future development, performance and financial position are set out in the reports of the Chairman, Chief Executive and Finance Director. The financial position of the Group, liquidity position and borrowing facilities will be detailed in the Company's Annual Report and Accounts, which will also set out the Group's processes for managing its capital, financial risk and exposure to financial markets risk.
The Group and Company have met their day to day working capital requirements through the use of two principal bank loans of £4.5 million and £5 million, which were repaid in February 2009 and replaced by one principal bank loan of £9 million which is repayable on 28 February 2011, and an overdraft facility of £112k (£500k up to February 2009) which is repayable on demand. The total facilities are secured on the freehold properties of the Group. The freehold properties, excluding the Bolton warehouse, were independently revalued to £12.9 million as at 1 November 2008.
The facilities include key financial covenants which require testing based on interim as well as full year financial information, the major one being the operating result for the period after interest and before taxation. The directors have prepared forecast information for the 2009/10 and 2010/11 years, covering a period of more than 12 months from the date of their approval of these financial statements. The directors are currently of the opinion that Group's forecast and projections show that the Group should be able to operate within its borrowing facilities and comply with its banking covenants. Forward covenant tests after applying appropriate financial sensitivities and mitigating actions show that none of the covenants are breached for the foreseeable future.
|
|
|
A breach of one or more of the covenants could result in the Group's debt becoming immediately repayable. Should a covenant breach become likely, there are a number of mitigating actions that the Group could take to avoid being in breach: these include seeking cost reductions and stimulating trade by promotions. The Group has not been required to seek any commitment from its bank to waive or amend any existing covenants and is not aware of any reason why its bank would refuse to support such a request, subject to acceptable terms, were one to be made.
The Group is subject to a number of risks and uncertainties which arise as a result of the current economic environment. In determining that the Group is a going concern, these risks, the most significant of which, as discussed in the Chairman's and Chief Executive's reports, is the impact on consumer behaviour and thus impact on the level of the Group's sales, have been considered by the Directors. The Directors have reviewed the Group's future cash forecasts and revenue projections, which they believe are based on prudent market data and past experience and have formed a judgment that at the time of approving these financial statements, based on those forecasts and projections, there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, the going concern basis is adopted in preparing these accounts. |
Related Shares:
BAE.L