Final Results

Crawshaw Group PLC

Final Results

Crawshaw Group PLC ("the Company"), the meat focussed retailer, today reports its audited results for the year ended 31st January, 2011.

Results highlights for the year to 31st January 2011.

·; Profit before tax up 194% to £0.6m (2010: £0.2m)

·; Sales £19.1m (2010: £19.0m)

·; EBITDA up 25% to £1.0m (2010: £0.8m)

·; Cash generated by operating activities up 83% to £1.1m (2010: £0.6m)

·; Net debt reduced to £0.5m (2010: £0.9m)

·; Cash margin up 2% and overheads down 3% over previous year

·; Like for like sales much improved trend versus prior year - shops up 1%; down 1% overall due to reduced footfall at market locations (2010: down 8%)

·; No new stores opened during year, but one opened since year end

Chairman's Statement

Sales and margin

Overall sales were ahead of the previous year at £19.1m (2010: £19.0m). This includes our 15 retail format stores, 5 market formats, and our wholesale business.

Like for like sales were down overall by 1% representing a much improved performance compared with an 8% fall in the previous year. We reported improving trends at the half year resulting in a -4% like for like after 6 months. Sales continued to improve throughout the second half resulting in the -1% we are now reporting.

Within that result, our 15 High Street format stores are key to our future, and they produced a like for like increase of 1%. The 5 market format locations, where like for like's were down 6% will be re-located as opportunities arise. Wholesale sales are a small element of our business (6% of sales) and generate lower gross margins.

Whilst the sales result was much improved, it would have been better had we not suffered the poor weather conditions before Christmas. Having lost almost a week's sales due to the extreme snowfall, we were unable to make up the shortfall as our customers generally buy for immediate consumption.

Gross margin strengthened to 43.6% (2010: 43.0%) helping cash margin to increase by 2% to £8.3m (2010: £8.2m)

Costs

Overheads have fallen 2.8% to £7.7m (2010 : £7.9m) in the year despite rising fuel costs, improvements to our IT infrastructure and increased maintenance expenditure as our estate grows.

Staff related costs have fallen in real terms as we continue to improve our operational efficiency. Administrative and property expenses are being negotiated downwards as they come up for renewal and other costs are regularly reviewed across all our units as well as centrally.

Profit

Given the improvements in sales, margin and overhead costs, operating profit strengthened to £0.6m (2010: £0.3m) before exceptional costs.

Profit before tax for the year is up 194% at £0.6m (2010 : £0.2m). Profit before tax and operating profit are reported at the same level this year as there are no exceptional costs (2010 : £0.1m) and interest charges have fallen in line with our debt requirements.

No dividend is proposed.

Cash

I am very pleased to say that in the year we generated £1.1m (2010: £0.6m) of cash from operating activities. Cash has been utilised on capital projects £0.7m (shops & vehicles) and on the repayment of loans £0.5m. Cash balances at the end of the reporting period are £0.7m (2010: £0.8m).

Net debt has reduced from £0.9m reported in January 2010 to £0.5m in January 2011.

New stores

As previously reported, in 2009 we opened 7 new stores in various sizes and formats. Following on from my comments last year, the 2 new larger formats continue to show the best performance on all measures - sales per sq ft, gross margin, return on capital and contribution.

The capital outlay for this format is approximately £0.4m, and we would expect contribution levels to reach full payback within 2 to 3 years.

With this template in mind, since the year end, we have opened a new larger format store in the Westfield Centre, Derby. The store started trading well but it is too soon to fully evaluate the likely returns.

It is our intention to seek further sites once an ongoing trading pattern at the Derby store has been established.

We have also experimented with a very small mobile format to serve different local communities each day of the week. It's very early days but we feel the concept certainly has potential for expansion.

Outlook

In recent weeks there has been evidence to suggest that the retail trading climate has become more difficult. Whilst footfall has held up well, customers are becoming more interested in lower priced products. This, coupled with the fact that meat prices are continuing to rise, leads us to be cautious about the outlook for the year ahead.

Richard Rose

Chairman

26th April, 2011

Directors' report

Principal Activity

The principal activity of the Group is the operation of a chain of meat focused retail food stores. The Group has two distribution centres in Grimsby and Rotherham, plus 20 retail locations across Yorkshire, Lincolnshire and Nottinghamshire.

Business Review

Up to 31 January 2011 Crawshaw Group plc has completed two full years of trading as an AIM listed plc.

The Company's principal subsidiary, Crawshaw Butchers Limited, which operates the primary business of the Group, traded profitably such that the Group reported an operating profit before one off exceptional costs of £638,935 (2010: £318,231) on turnover of £19,062,928 (2010: £18,953,855).

Exceptional items were not incurred in the year to 31 January, 2011 however, there was an exceptional item in the prior year ended 31 January, 2010. This related to a loss of office payment plus associated costs to our outgoing Finance Director, Andrew Richardson and totalled £86,855. Profit before tax for the year is £569,487 (2010 : £193,430) and the earnings per share for the period are 0.720p (2010 : 0.409p).

The extreme weather conditions during December 2010 did affect our year end sales performance. Our customers buy for immediate consumption and therefore if they cannot get to the shops those sales are lost. However, despite this we are reporting much improved trends in sales performance. Like for like sales in the year were down overall by 1% (2010: -8%), and within this we have seen some excellent performances from our shops with like for like sales improving by 1% (2010: -6%).

We continue to focus on "in store" customer service and during the year we have further invested in staff training programs on and off site. Added to this we regularly use sales promotions/offers to remind customers of the quality and the value of our products. As a result customer loyalty remains very high and this has undoubtedly contributed to our ability to maintain footfall across our estate.

Gross margin strengthened to 43.6% (2010: 43.0%) helping cash margin to increase by 2% to £8,317,306 (2010: £8,150,081).

A new store was opened in Derby in February 2011. We have now opened 8 new stores in varying sizes since July 2008 and of these stores, we have agreed as a Board to roll out the larger format stores as the returns on investment are greater than those delivered from smaller stores.

Overheads have fallen 3% to £7,704,323 (2010 : £7,926,235) in the year despite rising fuel costs, improvements in our IT infrastructure and increased maintenance expenditure as our estate grows.

Staff related costs have fallen in real terms as we continue to improve our operational efficiency. Administrative and property expenses are being negotiated downwards as they come up for renewal and other costs are regularly reviewed across all our units as well as centrally.

Total comparable sales for the first 10 weeks of the current year are running at the same level as last year.

Balance sheet position

At our reporting date, the Group had a cash balance of approximately £0.7m, total interest bearing loans and borrowings of approximately £1.2m and total assets of £14m.

Cash has been utilised on the opening of a new retail outlet in Derby plus other small capital projects and on the repayment of debt. As a result the debt position as at 31st January, 2011 was approximately £1.2 million consisting of the total outstanding revolving credit facility of £0.4m and £0.8m related to mortgages secured on the Group's distribution centre in Grimsby and a store in Hull. Taking into account cash balances the net debt position is reported as £0.5m (2010: £0.9m).

In total £1.2m of cash has been utilised in the year on capital expenditure (£0.7m) and partial repayment of the revolving credit facility (£0.5m).These requirements have been met through cash generated from operations (£1.1m) and a reduction in cash balances held (£0.1m).

In addition to the existing property mortgage loan arrangements, a £0.5m revolving credit facility with RBS expires 30th June, 2011. It is not envisaged that the company will need to renew this facility at this time.

The Company is taking advantage of the exemption in section 408 of the Companies Act 2006

not to present its individual income statement.

Notes to the financial statements

(forming part of the financial statements)

1. ACCOUNTING POLICIES

Crawshaw Group Plc (the "Company") is a company incorporated and domiciled in the UK.

The group financial statements consolidate those of the Company and its subsidiaries (together referred to as the "Group") and equity account the Group's interest in jointly controlled entities. The parent company financial statements present information about the Company as a separate entity and not about its group.

Both the parent company financial statements and the group financial statements have been prepared and approved by the directors in accordance with International Financial Reporting Standards as adopted by the EU ("Adopted IFRSs"). On publishing the parent company financial statements here together with the group financial statements, the Company is taking advantage of the exemption in s408 of the Companies Act 2006 not to present its individual income statement and related notes that form a part of these approved financial statements.

The following new and revised IFRSs have been adopted in these consolidated financial statements. The application of these new and revised IFRSs has not had any material impact on the amounts reported for the current and prior years but may affect the accounting for future transactions or arrangements. Other new standards and interpretations have no significant impact on the Group.

·; IFRS 2 Group Cash-settled Share-based Payment Transactions. The amendments clarify the scope of IFRS 2, as well as the accounting for group cash-settled share-based payment transactions in the separate (or individual) financial statements of an entity receiving the goods or services when another group entity or shareholder has the obligation to settle the award.

·; IFRS 3 (revised) Business Combinations requires some significant changes to the way business combinations are accounted for. All costs associated with business combinations are expensed directly to the statement of comprehensive income. Additionally any changes to contingent consideration classified as debt must now be dealt with through the Income Statement subsequent to acquisition.

·; Improvements to IFRSs: in April 2009 the International Accounting Standards Board issued its second omnibus of amendments to its standards, primarily with a view to removing inconsistencies and clarifying wording. The adoption of these amendments, which are effective from 1 January 2010, did not have any impact on the reporting of the financial position or performance of the Group.

The Group has not applied the following new and revised IFRSs and IFRICs that are EU endorsed but are not yet effective:

·; IAS 24 (revised in 2009) - Related Party Disclosures. Effective for annual periods beginning on or after 1 January 2011.

·; IFRIC 19 - Extinguishing Financial Liabilities with Equity Instruments. Effective for annual periods beginning on or after 1 July 2010.

The Group is currently considering the implications of these standards and interpretations. They are not expected to have a material impact on the Group's financial statements.

BASIS OF CONSOLIDATION

Subsidiaries

Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the Group takes into consideration potential voting rights that are currently exercisable. The acquisition date is the date on which control is transferred to the acquirer. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

Jointly controlled entities are those entities over whose activities the Group has joint control, established by contractual agreement and requiring the venturers' unanimous consent for strategic financial and operating decisions. Jointly controlled entities are accounted for using the equity method (equity accounted investees) and are initially recognised at cost. The Group's investment includes goodwill identified on acquisition, net of any accumulated impairment losses. The consolidated financial statements include the Group's share of the total comprehensive income and equity movements of equity accounted investees, from the date that joint control commences until the date that joint control ceases. When the Group's share of losses exceeds its interest in an equity accounted investee, the Group's carrying amount is reduced to nil and recognition of further losses is discontinued except to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of an investee.

The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these consolidated financial statements.

GOING CONCERN

The company's business activities, together with the factors likely to affect it future development, performance and position are set out in the Business Review on pages 6 to 7.In addition ,the notes to the financial statements include the company's objectives, policies and processes for managing its capital and its exposures to credit and liquidity risk.

The company has cash resources in excess of the amounts due for repayment on cessation of the revolving credit facility on 30th June 2011.As part of its normal business practice, budgets, cash flow forecasts and longer term financial projections are prepared and in reviewing this information, the Directors are satisfied that the company has adequate resources to enable it to continue in business for the forseeable future. As a consequence, the Directors believe that the company is well placed to manage its business risks successfully despite the current uncertain economic outlook.

The Directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the forseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

CLASSIFICATION OF FINANCIAL INSTRUMENTS ISSUED BY THE GROUP

In applying policies consistent with IAS 32, financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions:

(a) they include no contractual obligations upon the Group to deliver cash or other financial assets or to exchange financial assets or financial liabilities with another party under conditions that are potentially unfavourable to the Group; and

(b) where the instrument will or may be settled in the Group's own equity instruments, it is either a non-derivative that includes no obligation to deliver a variable number of the Group's own equity instruments or is a derivative that will be settled by the Group's exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments.

To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. Where the instrument so classified takes the legal form of the Group's own shares, the amounts presented in this financial information for called up share capital and share premium account exclude amounts in relation to those shares.

Preference share capital is classified as equity if it is non-redeemable, or redeemable only at the Company's option, and any dividends are discretionary. Dividends thereon are recognised as distributions within equity upon approval by the Group's shareholders.

Preference share capital is classified as a liability if it is redeemable on a specific date or at the option of the shareholders, or if dividend payments are not discretionary. Dividends thereon are recognised as interest expense in profit or loss as accrued.

Finance payments associated with financial liabilities are dealt with as part of finance expenses. Finance payments associated with financial instruments that are classified in equity are treated as distributions and are recorded directly in equity.

NON-DERIVATIVE FINANCIAL INSTRUMENTS

Non-derivative financial instruments comprise investments in equity securities, trade and other receivables, cash and cash equivalents and trade and other payables.

Trade and other receivables are recognised at stated cost less impairment losses. It is the Company's policy to review trade and other receivable balances for evidence of impairment at each reporting date. Any receivables which give significant cause for concern are written down to the best estimate of the recoverable amount.

Cash and cash equivalents comprise cash-in-hand and cash-at-bank.

Trade and other payables are recognised at stated cost.

ASSOCIATES AND JOINTLY CONTROLLED ENTITIES (equity accounted investees)

Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Significant influence is presumed to exist when the Group holds between 20 and 50 percent of the voting power of another entity. Joint ventures are those entities over whose activities the Group has joint control, established by contractual agreement and requiring unanimous consent for strategic financial and operating decisions.

Associates and jointly controlled entities are accounted for using the equity method (equity accounted investees) and are initially recognised at cost. The Group's investment includes goodwill identified on acquisition, net of any accumulated impairment losses. The consolidated financial statements include the Group's share of the income and expenses and equity movements of equity accounted investees, after adjustments to align the accounting policies with those of the Group, from the date that significant influence or joint control commences until the date that significant influence or joint control ceases. When the Group's share of losses exceeds its interest in an equity accounted investee, the carrying amount of that interest (including any long-term investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee.

PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.

Depreciation is charged to the income statement on a straight-line basis over the estimateduseful lives of each part of an item of property, plant and equipment. Residual values of property, plant and equipment is assumed to be nil. Land is not depreciated. The estimated useful lives are as follows:

·; Freehold property 2%

·; Leasehold buildings in accordance with the lease term

·; Leasehold improvements in accordance with the lease term

·; Plant, equipment and vehicles 10-25% on reducing balance

INTANGIBLE ASSETS AND GOODWILL

Goodwill represents amounts arising on acquisition of businesses. In respect of business acquisitions that have occurred since 11 December 2006, goodwill represents the difference between the cost of the acquisition and the fair value of the net identifiable assets acquired. Identifiable intangibles are those which can be sold separately or which arise from legal rights regardless of whether those rights are separable.

Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is not amortised but is tested annually for impairment. Any impairment is then recognised immediately in profit or loss and is not subsequently reversed.

Intangible assets that are acquired by the Group, which have finite useful lives, are measured at cost less accumulated amortisation and accumulated impairment losses.

IFRS 1 grants certain exemptions from the full requirements of Adopted IFRSs in the transition period. The Company elected not to restate business combinations in Crawshaw Butchers Limited that took place prior to 1 February 2006. In respect of acquisitions prior to 1 February 2006, goodwill is included at 1 February 2006 on the basis of its deemed cost, which represents the amount recorded under UK GAAP which was broadly comparable save that only separable intangibles were recognised and goodwill was amortised.

AMORTISATION

Amortisation is recognised in the statement of comprehensive income on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use. The estimated useful lives for the current and comparative periods are as follows:

·; Brand 20 years

IMPAIRMENT

The carrying amounts of the Group's assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset's recoverable amount is estimated.

For goodwill and intangible assets that are not yet available for use, the recoverable amount is estimated at each balance sheet date.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in the statement of comprehensive income.

Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro rata basis. A cash generating unit is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.

Calculation of recoverable amount

The recoverable amount of other assets is the greater of their fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an asset that does not generate largely independent cash inflows, the recoverable amount is determined for the cash-generating unit to which the asset belongs.

Reversals of impairment

An impairment loss in respect of goodwill is not reversed.

In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has been a change in the estimates used to determine the recoverable amount.

An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

PROVISIONS

A provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected, risk adjusted, future cash flows at a pre-tax risk-free rate.

TRADE AND OTHER RECEIVABLES

Trade and other receivables are recognised at their fair value and thereafter at amortised cost less impairment charges.

INVENTORIES

Inventories are stated at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items. Cost comprises purchase price. Net realisable value is estimated selling price in the ordinary course of business, less the estimated costs of completion and selling expenses.

Inventories are primarily goods for resale.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents comprise cash-in-hand and cash-at bank. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose only of the statement of cash flows.

EMPLOYEE BENEFITS

Defined contribution plans

The Group operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. Obligations for contributions to defined contribution pension plans are recognised as an expense in the income statement as incurred.

Short-term benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A provision is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.

REVENUE

Revenue is derived from retail butcher activities, stated after trade discounts, VAT and any other sales taxes. Revenue from the sale of goods is recognised in the statement of comprehensive income when the significant risks and rewards of ownership have been transferred to the buyer. Where the Group sells to distributors, revenue from the sale of goods is recognised where there are no further obligations on the Group and when the associated economic benefits are due to the Group and the turnover can be reliably measured.

EXPENSES

Operating lease payments

Payments made under operating leases are recognised in the statement of comprehensive income on a straight-line basis over the term of the lease. Lease incentives received are recognised in the income statement as an integral part of the total lease expense.

Net financing costs

Net financing costs comprise interest payable, finance charges on shares classified as liabilities, interest receivable on funds invested and dividend income.

Interest income and interest payable is recognised in profit or loss as it accrues, using the effective interest method. Dividend income is recognised in the income statement on the date the entity's right to receive payments is established.

Borrowing costs

In the current year borrowing costs are expensed in the consolidated statement of comprehensive income as incurred.

TAXATION

Tax on the profit or loss for the period comprises current and deferred tax. Tax is recognised in the statement of comprehensive income except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to tax payable in respect of previous periods.

Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of goodwill; the initial recognition of assets or liabilities that affect neither accounting nor taxable profit other than in a business combination, and differences relating to investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised.

BANK LOANS, OVERDRAFTS AND LOAN NOTES

Interest-bearing bank loans, overdrafts and loan notes are recorded at the proceeds received, net of direct issue costs. Finance charges, including premiums payable on settlement or redemption and direct issue costs, are accounted for on an accruals basis in profit or loss using the effective interest rate method and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise.

SEGMENTAL REPORTING

An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group's other components. Operating segments' operating results are reviewed regularly by the Group's Managing Director to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. The Directors consider each location to be a separate operating segment. The Directors have applied the provisions within IFRS 8 for aggregation of operating segments with similar risks and markets, to have one reportable segment. The Group's business operations are conducted exclusively in the UK so geographical segment reporting is not required.

SIGNIFICANT JUDGEMENTS AND ESTIMATES

The preparation of the financial information in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and underlying assumptions are reviewed on an ongoing basis.

The estimates associated with the assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgements about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to estimates are recognised in the period in which the estimate is revised if the revision only affects that period, or in the period of revision and future periods if the revision affects both current and future periods.

The key sources of estimation uncertainty at the balance sheet date are:

GOODWILL

Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating unit(s) to which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value.

The carrying amount of goodwill at the balance sheet date was £7.7 million. Details of the present value calculation are provided in note 11.

BRAND INTANGIBLES

The royalty relief approach is considered the most appropriate method to determine the value of the brand. A royalty percentage of 1% has been applied to revenue streams for the twenty years ended 31 January 2028 from the branch network carrying the Crawshaw brand. These have then been discounted at 15.7% to arrive at an initial carrying value of £693,558. This will be amortised over the finite life of twenty years, with the amortisation charge being included within administrative expenses in the statement of comprehensive income.

2. EXCEPTIONAL ITEMS

3. OTHER OPERATING INCOME

The Group charges RGV Refrigeration a management charge each period for administration services. The Group has investment in RGV Refrigeration, which is described further in note 12.

4. EXPENSES AND AUDITORS REMUNERATION

Included in operating profit are the following:

Auditors' remuneration:

5. STAFF NUMBERS AND COSTS

The average number of persons employed by the Company (including directors) during the period, analysed by category, was as follows:

The aggregate payroll costs of these persons were as follows:

6. KEY MANAGEMENT COMPENSATION

The Group considers key management personnel as defined in IAS24 'Related Party Disclosures' to be the Directors of the Group. Detailed disclosures of individual remuneration, pension entitlements and share options, for those directors who served during the year, are given in the Report of the Remuneration Committee, these numbers have been audited. The aggregate of emoluments and amounts receivable under long term incentive schemes of the highest paid director was £59,486 (2010: £60,202),and company pension contributions of £54,580 (2010: £52,996) were made to a money purchase scheme on his behalf. See note 18 for further details.

7. FINANCE AND INCOME EXPENSE

8. INCOME TAX EXPENSE

The Emergency Budget on 22 June 2010 announced that the UK corporation tax rate will reduce from 28% to 24% over a period of 4 years from 2011. The first reduction in the UK corporation tax rate from 28% to 27% was enacted on 27 July 2010 and will be effective from 1 April 2011 and therefore deferred tax balances at 31 January 2011 include the impact of this rate reduction.

The Budget on 23 March 2011 announced further measures to reduce the UK corporation tax rate to 23% by 2014, starting with an additional reduction of 1% in the tax rate to 26% with effect from 1 April 2011. This has not been reflected in the figures as it was not substantively enacted at the balance sheet date.

9. EARNINGS PER ORDINARY SHARE

Basic earnings per ordinary share is calculated by dividing the earnings attributable to the ordinary shareholders by the weighted average number of ordinary shares outstanding during the year of 57,818,801 (31/1/10: 55,686,461).

Diluted EPS is calculated by dividing the profit for the year attributable to ordinary shareholders by the weighted average number of ordinary shares in issue adjusted to assume conversion of all potentially dilutive ordinary shares from the start of the year giving a figure of 57,818,801 (31/1/10: 56,790,283).

The calculation of the basic and diluted earnings per share is based on the following data:

10. PROPERTY, PLANT AND EQUIPMENT

There are no items of property, plant and equipment in the Company.

For details of security given over property, plant and equipment see note 20.

PRIOR YEAR

11. INTANGIBLE ASSETS

PRIOR YEAR

There are no intangible assets within the Company.

Goodwill is tested for impairment annually.

Acquired brand values are calculated using the royalty relief approach and are amortised over twenty years. The remaining amortisation period is 16 years and 2 months.

The amortisation and impairment charge is recognised in the following line items in the consolidated statement of comprehensive income:

Impairment testing

Goodwill has been allocated to cash generating units or groups of cash generating units as follows:

The recoverable amount of Crawshaw Butchers Ltd at acquisition has been calculated with reference to its value in use.The key assumptions of this calculation are shown below:

The growth rate used in the value in use calculation reflects management's assessment of the likely growth rate achievable by the Group at the stores that were in existence at the acquisition of Crawshaw Butchers Limited. This is a prudent rate which does not exceed the average long-term growth rate for the relevant markets.

Management have determined the discount rate by reference to other companies of similar nature within their industry and their assessment of the optimal long-term capital structure for the business.

12. INVESTMENTS IN EQUITY ACCOUNTED INVESTEES

Other investments comprise a 50% share in RGV Refrigeration, a partnership jointly owned by Crawshaw Butchers Limited and Mr M Hornsby. The principal place of business for RGV Refrigeration is 17-25 John Street, Rotherham, South Yorkshire S60 1EQ.The last year end being 30 September 2010.The Group does not exert control over the entity.

The carrying value of investments in equity accounted investees includes £20,207 (2010: £ 27,246) accumulated profit held by RGV Refrigeration.

13. OTHER INVESTMENTS

14. DEFERRED TAX LIABILITIES

Recognised deferred tax liabilities

Deferred tax liabilities are attributable to the following:

Movement in deferred tax during the period

15. INVENTORIES

16. TRADE AND OTHER RECEIVABLES

The directors consider that the carrying amount of trade and other receivables approximates their fair value.

Aged analysis of trade receivables

17. TRADE AND OTHER PAYABLES

Trade payables and other creditors comprise amounts outstanding for trade purchases and ongoing costs. The directors consider that the carrying amount of trade payables approximates to their fair value.

Non-current accruals relate to reverse lease premiums, which are credited to the income statement on a straight-line basis over the lease term.

18. EMPLOYEE BENEFITS

Pension plans

Defined contribution plans

The Group operates a defined contribution pension plan. The assets of the scheme are held separately from those of the Group in an independently administered fund. The amount charged to the income statement represents the contributions payable to the scheme in respect of the accounting period. Pension costs for the defined contribution scheme are as follows:

Share Based Payments

Share Options

Share options granted prior to the reverse acquisition are held by former associates of Felix Group PLC. Further share options were granted post reverse acquisition on 14 April 2008 to key employees of the enlarged group, Crawshaw Group PLC. In line with the scheme rules, options for employees who leave the business lapse after 6 months.

The share options in issue all relate to ordinary shares of 5p and are to be settled by the physical delivery of shares are as follows

The expected volatility is wholly based on the historic volatility (calculated based on the weighted average remaining life of the share options), adjusted for any expected changes to future volatility due to publicly available information.

The fair value of options at grant date of 14 April 2008 of 11.5p was determined based on the black scholes model. The model inputs were the share price of 42.5p, the exercise price of 42.5p, expected volatility of 43%, expected dividends of £Nil, a term of two years and a risk free rate of 5%. During the year, the Group recognised a charge of £19,723 (2010: £73,170) in relation to equity settled share based payments in the consolidated statement of comprehensive income. These option charges have been credited against the retained earnings reserve. No further charge is expected in relation to issued options.

19. CAPITAL AND RESERVES

Reconciliation of movements in capital and reserves - Group

The reverse acquisition reserve was established under IFRS3 'Business Combinations' following the deemed acquisition of Crawshaw Group Plc by Crawshaw Holdings Limited on 11 April 2008.

The capital contribution reserve arose in relation to the waiver of shareholder loan note interest

prior to the reverse acquisition.

Reconciliation of movement in capital and reserves - Company

The merger reserve was established on 11 April 2008 following the share for share exchange undertaken between the Company and Crawshaw Holdings Limited as part of the reverse acquisition.

SHARE CAPITAL - Group and Company

All issued shares are fully paid. The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at the meetings of the company.

20. LOANS AND BORROWINGS - GROUP

Terms and debt repayment schedule

The following liabilities disclosed under bank loans are secured by fixed and floating charges over the assets of the Group.

The principle features of the loans are as follows:

(a) A Revolving Credit Facility has a current balance of £0.4m and carries an interest rate of LIBOR +2.25%.

(b) A mortgage of £840,000 against freehold property was taken out on the 21st May 2008 over a 5 year period at a rate of LIBOR +1.5%.

21. FINANCIAL INSTRUMENTS

The Group's principal financial instruments comprise loans and borrowings, cash and trade creditors. The main purpose of these financial instruments is to raise finance for the Group's operations.

The main risks arising from the Group's financial instruments are interest rate risk, liquidity risk and credit risk. The board reviews and agrees policies for managing each of these risks and they are summarised below.

Interest rate risk

The Group's exposure to market risk for changes in interest rates relates primarily to the Group's long-term debt obligations.

The Group has not currently entered into any steps to mitigate its risk to variability in interest rates.

Credit risk

The Group's principal financial assets are cash and receivables. The Group's credit risk is primarily attributable to trade receivables. Trade receivables are included in the balance sheet net of doubtful receivables, estimated by the Group's management based on prior experience and their assessment of current economic conditions.

At the balance sheet date the Directors consider there to be no significant credit risk.

Liquidity risk

The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of cash and bank loans. The cash generative nature of the business is forecast to continue and therefore we have reduced our revolving credit facility (RCF) requirement over the short term from £2.5m to £1m to reduce our exposure to non utilisation fees. This facility is in place until 30th June 2011. We plan to further reduce this facility subject to capital expenditure requirements. The Directors are confident that there will continue to be sufficient headroom to cover liquidity risk.

Effective interest rates

In respect of income-earning financial assets and interest-bearing financial liabilities, the following table indicates their effective interest rates at the balance sheet date and the periods in which they mature or, if earlier, are repriced.

22. CAPITAL MANAGEMENT

The capital structure of the group is a mixture of (i) net debt made up of borrowings and cash balances and (ii) equity comprising issued share capital and reserves as detailed in note 19.

The Group's primary objective is to safeguard its ability to continue as a going concern, through the optimisation of the debt and equity balance, and to maintain a strong credit rating and headroom. The Group manages its capital structure through detailed management forecasts and clear authorization procedures for significant capital expenditure. The Board makes appropriate decisions in light of the current economic conditions and strategic objectives of the Group.

A key objective of the Group's capital management is to maintain compliance with the covenants set out in the bank facility.

Throughout the year, the Group has complied with this policy.

There has been no change in the objectives, policies or processes with regards to capital management during the years ended 31 January 2011 and 31 January 2010.

23. CAPITAL COMMITMENTS

24. OPERATING LEASES

Non-cancellable operating lease rentals are payable as follows:

The Company leases a number of retail outlets, warehouse and factory facilities under operating leases. Land and buildings have been considered separately for lease classification. During the year £821,149 (2010: £807,579) was recognised as an expense in the income statement in respect of operating leases.

25. RELATED PARTY TRANSACTIONS

Transactions with key management personnel

The Board and certain members of senior management are related parties within the definition of IAS 24 (Related Party Disclosures). Summary information of the transactions with key management personnel is provided in note 6. Detailed disclosure of the individual remuneration of Board members is included in The Report of the Remuneration Committee on pages 12 to 13. There is no difference between transactions with key management personnel of the Company and the Group.

Transactions with subsidiaries

The Company has entered into transactions with its subsidiary undertakings in respect of the following: provision of Group services (including senior management, IT, accounting, purchasing and legal services). Recharges are made to subsidiary undertakings for intra- group balances, based on their amount and interest rates set by Group management.

During the year these charges amounted to:

The amount outstanding from subsidiary undertakings to the Company at 31 January 2011 totalled £6,745,951 (2010: £6,574,682). Amounts owed to subsidiary undertakings by the Company at 31 January 2011 totalled £nil (2010: £nil).

The Company has suffered no expense in respect of bad or doubtful debts of subsidiary undertakings in the year (2010: £nil).

Transactions with jointly controlled entities

Crawshaw Butchers Limited, a subsidiary of Crawshaw Holdings Limited, holds a 50% share in a partnership which trades under the name of RGV Refrigeration. The operations of the partnership comprise of the maintenance and repair of refrigeration machinery for a variety of customers. 

During the year the transactions amounted to:

The amount outstanding from jointly controlled entities to the Group at 31 January 2011 totalled £8,669 (2010: £nil). Amounts owed to jointly controlled entities by the Group at 31 January 2011 totalled £9,655 (2010: £4,047).

The Group has suffered no expense in respect of bad or doubtful debts of jointly controlled entities in the year (2010: £nil).

Transaction with other related parties

During the year the Group paid £36,667 (2010: £nil) to Electro Switch Limited in respect of consultancy services. Electro Switch Limited is a company which provides such services and Mr R Rose, a Director of Crawshaw Group Plc, is also a Director of this Company. Amounts owed to Electro Switch Limited by the Group at 31 January 2011 totalled £nil (2010: nil).

The Group leases a property owned by The Colin Crawshaw Pension Scheme for factory facilities and paid rental fee of £13,500 in 2011 (2010: £13,500). Amounts owed to The Colin Crawshaw Pension Scheme by the Group at 31 January 2011 totalled £nil (2010: £nil).

26. PRINCIPAL SUBSIDIARY UNDERTAKINGS

At 31 January 2011 Crawshaw Group PLC had the following principal subsidiary undertakings:

Crawshaw Holdings Limited - United Kingdom - Intermediate Holding Company

Crawshaw Butchers Limited - United Kingdom - Retail Butchers *

The shareholdings were 100% of the subsidiary undertakings' ordinary and preference shares. Each of the subsidiaries is included in the consolidated financial statements.

* Not held directly but via Crawshaw Holdings Ltd

27. ULTIMATE PARENT COMPANY

The Company is the ultimate parent company of the Group.

No other group financial statements include the results of the Company.

28. ANNUAL REPORT

The Annual Report will be posted to shareholders on 6th May, 2011 and will also be available from the Company's website at www.crawshawgroupplc.com.

29. ANNUAL GENERAL MEETING

The Annual General Meeting will be held at Bradmarsh Business Park, Bow Bridge Close, Rotherham S60 1BY on 27 June 2011 at 12 noon.

The financial information set out above does not constitute the Company's consolidated statutory accounts for the periods ended 31 January 2011 or 31 January 2010 but is derived from those accounts. Statutory accounts for the period ended 31 January 2010 have been delivered to the Registrar of Companies, and those for the period ended 31 January 2011 will be delivered following the Company's Annual General Meeting. The auditors, KPMG Audit Plc, have reported on those accounts; their reports were unqualified and did not contain statements under section 498(2) or (3) of the Companies Act 2006 or equivalent preceding legislation.