Full Year Results Part 2

Group Income statement

for the year ended 30 April 2010

Year ended 30 April 2010

Year ended 30 April 2009

Year ended 30 April 2010

(audited)

(audited)

(unaudited)

Continuing operations

Note (c)

£m

£m

€m (a)

Revenue

2

5,124.1

4,954.1

5,799.5

Group operating profit/(loss)

2

78.0

(72.3)

88.2

Share of post tax profit in joint venture and associates

5.5

7.3

6.3

Total operating profit/(loss)

83.5

(65.0)

94.5

Analysed as:

Retail profit (b)

3

98.6

77.0

111.6

Share of joint venture and associates interest and taxation

3

(0.8)

(0.7)

(0.9)

Valuation (losses)/gains

3

(4.8)

0.3

(5.4)

Profit on disposal of business operation

10

4.5

 -

5.0

Exceptional restructuring costs

10

(13.3)

(23.1)

(15.0)

Amortisation and impairment of acquisition related intangible assets

10

(0.7)

(118.5)

(0.8)

Total operating profit/(loss)

2

83.5

(65.0)

94.5

Finance costs

4

(18.1)

(14.0)

(20.5)

Finance income

5

1.4

6.5

1.6

Exceptional finance income/(costs)

4

2.8

(9.3)

3.2

Profit/(loss) before income tax

69.6

(81.8)

78.8

UK taxation

2.6

6.1

2.9

Overseas taxation

(31.1)

(38.9)

(35.2)

Total Taxation

6

(28.5)

(32.8)

(32.3)

 Profit/(loss) for the financial year from continuing operations

41.1

(114.6)

46.5

(Loss)/profit for the financial year from discontinued operations 

9

(1.8)

3.2

(2.0)

Profit for the financial year

39.3

(111.4)

44.5

Profit/(loss) attributable to:

- Equity shareholders

40.7

(111.4)

46.1

- Minority interests

(1.4)

 -

(1.6)

39.3

(111.4)

44.5

Earnings/(losses) per share - basic and diluted (pence)

Continuing operations

8.0

(21.7)

9.1

Discontinued operations

(0.3)

0.6

(0.3)

Total earnings/(losses) per share

8

7.7

(21.1)

8.8

Notes 

a) Income statement information in euros is provided for illustrative purposes only and is translated at the average exchange rate of € 1.1318 for £1.

b) Retail profit represents total operating profit before the share of joint venture and associates' interest and taxation, valuation gains and losses on options to acquire minority interests, profit on disposal of business operation, exceptional restructuring costs and amortisation and impairment of acquisition related intangible assets.

c) The notes on pages 9 to 24 form part of this financial information.

d) For details of equity dividends paid and proposed, see note 7 of this financial information.

Group statement of comprehensive income

for the year ended 30 April 2010

Year ended 30 April 2010

Year ended 30 April 2009

Year ended 30 April 2010

(audited)

(audited)

(unaudited)

Note

£m

£m

€m (a)

Profit/(loss) for the year

3

39.3

(111.4)

44.5

Other comprehensive income/(expense)

Exchange differences

(1.5)

(0.4)

(1.7)

Foreign exchange recycled to income statement on disposal of foreign operations

1.4

 -

1.6

Actuarial (losses)/gains on retirement benefit obligations

(20.7)

19.2

(23.4)

Tax on actuarial gains/losses on retirement benefit obligations

5.9

(5.5)

6.7

Available for sale assets - fair value gains/(losses) net of tax

3.7

(14.1)

4.2

Cash flow hedges - fair value gains/(losses) net of tax

0.9

(0.1)

1.0

Total comprehensive income/(expense) for the year

29.0

(112.3)

32.9

Attributable to:

- Equity shareholders

30.4

(112.1)

34.5

- Minority interests

(1.4)

(0.2)

(1.6)

Total comprehensive income/(expense) for the year

29.0

(112.3)

32.9

Note

(a) Statement of comprehensive income information in euros is provided for illustrative purposes only and is translated at the average exchange rate of € 1.1318 for £1.

Group statement of changes in equity

for the year ended 30 April 2010 

Share capital

Demerger & other reserves

Translation

reserve

Available for sale investments reserve

Retained earnings

Total shareholders' equity

Minority interest

Total equity

£m

£m

£m

£m

£m

£m

£m

£m

 At 1 May 2009 restated (Note 1)

132.4

732.3

(18.3)

(4.0)

(640.0)

202.4

(0.8)

201.6

 Profit for the year

 -

 -

 -

 -

40.7

40.7

(1.4)

39.3

 Other comprehensive income/(expense):

 Exchange differences

 -

 -

(1.5)

 -

 -

(1.5)

 -

(1.5)

 Transfer to income statement on disposal of foreign operations

 -

 -

1.4

 -

 -

1.4

 -

1.4

Actuarial losses on retirement benefit obligations

 -

 -

 -

 -

(20.7)

(20.7)

 -

(20.7)

 Tax on actuarial losses on retirement benefit obligations

 -

 -

 -

 -

5.9

5.9

 -

5.9

Available for sale assets - fair value gain net of tax

 -

 -

 -

3.7

 -

3.7

 -

3.7

Cash flow hedges - fair value gain net of tax

 -

0.9

 -

 -

 -

0.9

 -

0.9

Total comprehensive income/(expense) for the year

 -

0.9

(0.1)

3.7

25.9

30.4

(1.4)

29.0

Transactions with owners:

Dividends

 -

 -

 -

 -

(26.4)

(26.4)

(2.2)

(28.6)

Employee share schemes

 -

 -

 -

 -

1.1

1.1

 -

1.1

Investment in ESOP shares

 -

 -

 -

 -

(0.2)

(0.2)

 -

(0.2)

At 30 April 2010 

132.4

733.2

 (18.4)

(0.3)

(639.6)

207.3

(4.4)

202.9

Group statement of changes in equity (continued)

for the year ended 30 April 2010

Share capital

Demerger & other reserves

Translation

reserve

Available for sale investments reserve

Retained earnings

Total shareholders' equity

Minority interest

Total equity

£m

£m

£m

£m

£m

£m

£m

£m

At 1 May 2008 as reported

132.4

732.4

(18.1)

10.1

(456.6)

400.2

(0.5)

399.7

Prior year adjustment in respect of IAS 38 amendment (Note 1)

 -

 -

 -

 -

(0.9)

(0.9)

 -

(0.9)

At 1 May 2008 restated

132.4

732.4

(18.1)

10.1

(457.5)

399.3

(0.5)

398.8

Loss for the period - continuing operations

 -

 -

 -

 -

(114.6)

(114.6)

 -

(114.6)

Profit for the period - discontinued operations

 -

 -

 -

 -

3.2

3.2

 -

3.2

Other comprehensive income/(expense):

Exchange differences

 -

 -

(0.2)

 -

 -

(0.2)

(0.2)

(0.4)

Actuarial gains on retirement benefit obligations

 -

 -

 -

 -

19.2

19.2

 -

19.2

Tax on actuarial gains on retirement benefit obligations

 -

 -

 -

 -

(5.5)

(5.5)

 -

(5.5)

Available for sale assets - fair value loss net of tax

 -

 -

 -

(14.1)

 -

(14.1)

 -

(14.1)

Cash flow hedges - fair value loss net of tax

 -

(0.1)

 -

 -

 -

(0.1)

 -

(0.1)

Total comprehensive income/(expense) for the period

 -

(0.1)

(0.2)

(14.1)

(97.7)

(112.1)

(0.2)

(112.3)

Transactions with owners:

Dividends

 -

 -

 -

 -

(85.5)

(85.5)

(0.1)

(85.6)

Employee share schemes

 -

 -

 -

 -

1.1

1.1

 -

1.1

Investments in ESOP shares

 -

 -

 -

 -

(0.3)

(0.3)

 -

(0.3)

Tax on employee share schemes

 -

 -

 -

 -

(0.1)

(0.1)

 -

(0.1)

At 30 April 2009 restated

132.4

732.3

(18.3)

(4.0)

(640.0)

202.4

(0.8)

201.6

Group balance sheet

As at 30 April 2010

30 April 2010

30 April 2009

30 April 2008

30 April 2010

(audited)

(restated)

(restated)

(unaudited)

( Note 1)

( Note 1)

Note

£m

£m

£m

€m (a)

Assets

Non-current assets

Intangible assets

109.8

117.2

205.3

126.1

Property, plant and equipment

497.5

530.7

460.7

571.3

Available for sale financial assets

7.7

4.0

17.3

8.8

Investments in joint venture and associates

18.7

21.0

16.8

21.5

Other receivables

18.7

15.7

11.7

21.5

Deferred income tax assets

38.9

30.7

44.1

44.7

Total non-current assets

691.3

719.3

755.9

793.9

Current assets

Inventories

694.1

664.7

660.6

797.1

Trade and other receivables

227.7

242.9

268.7

261.5

Income tax

7.3

0.6

8.2

8.4

Other investments

10.3

23.8

45.1

11.8

Derivative financial instruments

0.9

0.1

0.1

1.0

Cash and cash equivalents

128.6

130.0

64.1

147.8

Total current assets

1,068.9

1,062.1

1,046.8

1,227.6

Total assets

1,760.2

1,781.4

1,802.7

2,021.5

Liabilities

Current liabilities

Borrowings

(9.4)

(0.8)

(4.5)

(10.8)

Income tax liabilities

(5.1)

(8.1)

(10.7)

(5.9)

Trade and other payables

(1,013.2)

(956.2)

(904.8)

(1,163.5)

Derivative financial instruments

 -

(0.4)

(0.3)

 -

Provisions

(2.4)

(2.9)

(1.7)

(2.8)

Total current liabilities

(1,030.1)

(968.4)

(922.0)

(1,183.0)

Non-current liabilities

Borrowings

(47.1)

(140.9)

(54.4)

(54.1)

Other payables

(350.8)

(356.7)

(308.5)

(402.9)

Deferred income tax liabilities

(53.4)

(54.7)

(41.7)

(61.4)

Retirement benefits

13

(74.1)

(55.1)

(75.9)

(85.1)

Provisions

(1.8)

(4.0)

(1.4)

(2.1)

Total non-current liabilities

(527.2)

(611.4)

(481.9)

(605.6)

Total liabilities

(1,557.3)

(1,579.8)

(1,403.9)

(1,788.6)

Net assets

202.9

201.6

398.8

232.9

Group balance sheet (continued)

As at 30 April 2010

Equity

Share capital

132.4

132.4

132.4

152.0

Other reserves

714.5

710.0

724.4

820.5

Retained earnings

(639.6)

(640.0)

(457.5)

(734.5)

Total equity shareholders' funds

207.3

202.4

399.3

238.0

Minority interests

(4.4)

(0.8)

(0.5)

(5.1)

Total equity

202.9

201.6

398.8

232.9

Notes

a) Balance sheet information in euros is provided for illustrative purposes only and is translated at the closing exchange rate of €1.1484 for £1. b) The notes on pages 9 to 24 form part of this financial information.

Approved by the Board of Directors on 23 June 2010 and signed on its behalf by:

Thierry Falque-Pierrotin

Dominic Platt

Director

Director

Group cash flow statementfor the year ended 30 April 2010

Year ended 30 April 2010

Year ended 30 April 2009

Year ended 30 April 2010

(audited)

(audited)

(unaudited)

Note

£m

£m

€m (a)

Cash flows from operating activities

Cash generated from operations

11

224.6

250.6

254.2

Interest paid

(15.6)

(15.8)

(17.7)

Tax paid

(40.4)

(25.9)

(45.7)

Net cash flows from operating activities

168.6

208.9

190.8

Cash flows from investing activities

Acquisition of subsidiaries, net of cash acquired

(0.3)

-

(0.3)

Proceeds from sale of subsidiary, net of cash disposed

10.7

-

12.1

Purchase of property, plant and equipment

(66.3)

(92.1)

(75.0)

Proceeds from sale of property, plant and equipment

6.0

2.1

6.8

Purchase of available for sale investments

-

(0.7)

-

Purchase of intangible assets

(27.3)

(40.6)

(30.9)

Cash inflow from other current investments

13.4

12.3

15.2

Interest received

1.4

6.7

1.6

Dividends received from associates/joint ventures

7.3

5.5

8.3

Net cash used in investing activities

(55.1)

(106.8)

(62.2)

Cash flows from financing activities

Net (repayment of)/proceeds from borrowings

(91.2)

66.0

(103.2)

Dividends paid to shareholders

7

(26.4)

(85.5)

(29.9)

Dividends paid to minority interests

(2.2)

(0.1)

(2.5)

Net cash used in financing activities

(119.8)

(19.6)

(135.6)

Net cash (outflow)/inflow from cash, cash equivalents and bank overdrafts

12

(6.3)

82.5

(7.0)

Effects of exchange rate changes

12

(3.7)

(12.9)

(4.2)

Net (decrease)/increase in cash, cash equivalents and bank overdrafts

(10.0)

69.6

(11.2)

Cash, cash equivalents and bank overdrafts at start of year

12

129.2

59.6

146.2

Cash, cash equivalents and bank overdrafts at end of year

119.2

129.2

135.0

Notes

a) Cash flow information in euros is provided for illustrative purposes only and is translated at the average exchange rate of €1.1318 for £1.

b) The notes on pages 9 to 24 form part of this financial information.

1 Basis of preparation

The preliminary results for the year ended 30 April 2010 have been extracted from audited accounts which have not yet been delivered to the Registrar of Companies. They have been prepared on the basis of the accounting policies set out in the Group's 2009 Financial Statements, all of which have been applied consistently throughout the year and the preceding year except for changes in accounting policy as noted below. The statutory accounts of the Company for the year ended 30 April 2009, on which the auditors have given an unqualified opinion, have been filed with the Registrar of Companies. The financial information set out in this Preliminary Announcement does not constitute statutory accounts for the year ended 30 April 2010 or year to 30 April 2009 within the meaning of sections 434-436 of the Companies Act 2006. The financial information for the year ended 30 April 2010 is derived from the statutory accounts for that period. The report of the auditors on the statutory accounts for the year ended 30 April 2010 was unqualified and did not contain a statement under Section 498 of the Companies Act 2006.

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations as adopted by the European Union (EU) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The consolidated financial statements have been prepared under the historical cost convention as modified by the revaluation of certain financial instruments and retirement benefits.

An adjustment of £0.9m has been made to opening equity to reflect the retrospective impact of the amendment to IAS 38 ("Intangible assets: Recognition of an expense"). The amendment requires an entity to expense expenditure on point of sale material and related marketing costs, which had previously been recognised as a prepayment in the balance sheet.

2 Continuing Group operating profit/(loss)

Year ended 30 April 2010

Year ended 30 April 2009

£m

£m

Analysis by function:

Revenue

5,124.1

4,954.1

Cost of sales

(3,676.0)

(3,585.5)

Distribution costs

(209.8)

(213.7)

Selling expenses

(901.5)

(852.8)

Administrative expenses

(252.1)

(243.6)

Other income

7.6

10.5

Valuation (losses)/gains

(4.8)

0.3

Profit on disposal of business operation

4.5

 -

Exceptional restructuring costs

(13.3)

(23.1)

Amortisation and impairment of acquisition related intangible assets

(0.7)

(118.5)

Group operating profit/(loss)

78.0

(72.3)

Share of post tax profit in joint venture and associates

5.5

7.3

Total operating profit/(loss)

83.5

(65.0)

Continuing Group operating profit/(loss) includes net premiums on exit from leased premises in the year to 30 April 2010 of £4.2m profit (year ended 30 April 2009: £2.1m profit).

Property, plant and equipment disposal losses were £2.2m for the year ended 30 April 2010 (year ended 30 April 2009: £4.3m loss).

Continuing Group total revenue includes revenue from services in the year to 30 April 2010 of £363.3m (year to 30 April 2009: £314.2m). Such revenues predominantly comprise those relating to customer support agreements, delivery and installation, product repairs and product support.

3 Segmental analysis

The Group bases its internal reporting systems on certain reportable segments. These segments are used by the chief operating decision maker, identified as the Group Chief Executive, for assessing performance and allocating resources.

The reportable segments are as follows:

- Darty France

- Comet

- Other established businesses (BCC, Vanden Borre, Datart)

- Developing businesses (Menaje del Hogar, Darty Italy, Darty Turkey and Darty Switzerland)

The implementation of IFRS 8 has resulted in a change to the basis of segmentation from the last Annual report. The "Other" segment has been split between "Other established businesses" and "Developing businesses" in line with the internal reporting framework.

Management believes the aggregation within the Other established businesses and Developing businesses segments is appropriate as it is consistent with the core principle of IFRS 8 and the businesses comprising these segments have similar economic characteristics. In addition the Other established businesses segment operates under a single management structure.

Year ended 30 April 2010

France Darty France

UK Comet

Other established businesses

Developing businesses

Unallocated 

Continuing Group

Discontinued operations

Group 

£m

£m

£m

£m

£m

£m

£m

£m

Revenue

2,471.0

1,650.2

685.2

317.7

 -

5,124.1

 -

5,124.1

Retail profit/(loss)

118.4

11.5

14.4

(29.1)

(16.6)

98.6

 -

98.6

Share of joint venture and associates interest and taxation

(0.8)

 -

 -

 -

 -

(0.8)

 -

(0.8)

Valuation losses

 -

 -

 -

 -

(4.8)

(4.8)

 -

(4.8)

Profit on disposal

 -

 -

 -

4.5

 -

4.5

 -

4.5

Amortisation and impairment of acquisition related intangible assets

 -

 -

 -

(0.7)

 -

(0.7)

 -

(0.7)

Exceptional costs

(3.0)

(0.4)

 -

(9.9)

 -

(13.3)

 -

(13.3)

Operating profit/(loss)

114.6

11.1

14.4

(35.2)

(21.4)

83.5

 -

83.5

Finance costs

(18.1)

 -

(18.1)

Finance income

1.4

 -

1.4

Exceptional finance costs

2.8

 -

2.8

Finance costs - net

(13.9)

 -

(13.9)

Profit before income tax

69.6

 -

69.6

Income tax expense

(28.5)

 -

(28.5)

Loss for the year from discontinued operations (note 9

 -

(1.8)

(1.8)

Profit/(loss) for the year

41.1

(1.8)

39.3

The share of operating profits of the joint venture and associates included within the retail profit for Darty France is £6.3m. The share of post tax profits of the joint venture and associates included within the operating profit of Darty France is £5.5m.

3 Segmental analysis (continued)

France Darty France

UK Comet

Other established businesses

Developing businesses

Unallocated 

Continuing Group

Discontinued operations

Group 

£m

£m

£m

£m

£m

£m

£m

£m

 Segmental total assets

849.1

385.3

227.1

134.8

163.9

1,760.2

 -

1,760.2

Segmental liabilities 

(765.1)

(392.9)

(145.2)

(88.1)

(166.0)

(1,557.3)

 -

(1,557.3)

Segmental depreciation and amortisation 

(58.9)

(27.3)

(14.1)

(9.6)

(1.1)

(111.0)

 -

(111.0)

Segmental capital expenditure 

48.4

15.0

14.9

13.1

2.8

94.2

 -

94.2

Investment in equity accounted joint venture and associates of £18.7m are included within the segment assets of Darty France.

 Year ended 30 April 2009

France Darty France

UK Comet

Other established businesses

Developing businesses

Unallocated 

Continuing Group

Discontinued operations

Group 

£m

£m

£m

£m

£m

£m

£m

£m

Revenue

 2,299.9

1,659.6

686.3

308.3

 -

4,954.1

 -

4,954.1

Retail profit/(loss)

103.9

10.1

20.0

(43.2)

(13.8)

77.0

 -

77.0

Share of joint venture and associates interest and taxation

(0.7)

 -

 -

 -

 -

(0.7)

 -

(0.7)

Valuation losses

-

 -

 -

 -

0.3

0.3

 -

0.3

Amortisation and impairment of acquisition related intangible assets

 -

 -

 -

(118.5)

 -

(118.5)

 -

(118.5)

Exceptional costs

-

(9.6)

 -

(13.5)

 -

(23.1)

 -

(23.1)

Operating profit/(loss)

103.2

0.5

20.0

(175.2)

(13.5)

(65.0)

 -

(65.0)

Finance costs

(14.0)

 -

(14.0)

Finance income

6.5

 -

6.5

Exceptional finance costs

(9.3)

-

(9.3)

Finance costs - net

(16.8)

 -

(16.8)

Loss before income tax

(81.8)

 -

(81.8)

Income tax expense

(32.8)

 -

(32.8)

Taxation credit arising on the sale of discontinued operations

 -

0.4

0.4

Profit for the year from discontinued operations

 -

2.8

2.8

(Loss)/profit for the year

(114.6)

3.2

(111.4)

The share of operating profits of the joint venture and associates included within the retail profit for Darty France is £8.0m. The share of post tax profits of the joint venture and associates included within the operating profit of Darty France is £7.3m.

3 Segmental analysis (continued)

France Darty France

UK Comet

Other established businesses

Developing businesses

Unallocated 

Continuing Group

Discontinued operations

Group 

£m

£m

£m

£m

£m

£m

£m

£m

Segmental total assets 

867.9

363.8

224.2

136.0

189.5

1,781.4

 -

1,781.4

Segmental liabilities 

(745.1)

(360.0)

(134.2)

(78.4)

(262.1)

(1,579.8)

 -

(1,579.8)

Segmental depreciation and amortisation 

(49.1)

(26.6)

(12.0)

(7.3)