Preliminary results

Richoux Group plc

Preliminary results for the 52 weeks ended 27 December 2009

Richoux Group plc, the owner and operator of Richoux restaurants, today announces its December 2009 preliminary results.

Key points:

§ Core Richoux brand is trading well and remains cash generative and profitable at restaurant level.

§ Cash of £2.96 million held at year end.

§ New mid-market "Zippers" restaurant opened in Chatham and a site for the new Frankie's Easy Diner concept found.

§ Impairment provision of £0.87 million.

Philip Shotter, Chairman of Richoux Group plc said:

"The core Richoux business is trading well with increased profitability. The Group's first "Zippers" restaurant has opened and initial trading is in line with expectations. A further Zippers site has just been acquired and is due to open in autumn 2010 with further openings being considered. In addition another site has been acquired in Chatham which will trade as an American diner."

23 April 2010

Results

Group turnover from our continuing operations for the 52 week period ended 27 December 2009 decreased to £5.02 million (2008: £5.56 million) following the closure of the Amato restaurants. Gross profit from continuing operations was £0.14 million (2008: £0.38 million). The gross profit before pre-opening costs percentage for the four established Richoux restaurants increased from 15% to 18% during the year. However there was a decrease in the total Group restaurants' gross profit before pre-opening costs percentage from 8% to 5% during the year, this was due to the performance of Amato and the new Richoux restaurants in High Wycombe and Old Compton Street. Administrative expenses for continuing operations (before impairment and onerous lease provision) of £0.44 million (2008: £0.69 million) were in line with expectations.

The impairment provisions of £0.87 million relate to the fitting-out of the Richoux in High Wycombe and the rebranding of the Old Compton Street restaurant as a Richoux following the subsequent decision to close them. The onerous lease provision of £0.40 million is in respect of the Richoux restaurant in High Wycombe.

The Directors are not recommending the payment of a dividend.

Operations

Richoux

The Group's established Richoux restaurants continue to trade well and gross profit before pre-opening costs for these four restaurants increased by 18% on the previous year. The new Richoux restaurants in High Wycombe and Old Compton Street were trading below expectations and have been closed. The Old Compton Street site has now been sold and the Group is actively investigating opportunities to dispose of the High Wycombe site.

The Group is seeking to establish new brands to sit alongside the Richoux brand and to this end is developing the following two brands:-

Zippers

The new mid-market family orientated "Zippers" restaurant has opened in Chatham and initial trading has been in line with expectations. New leasehold premises have been acquired in Andover, Hampshire and the new restaurant is expected to open in autumn 2010.

Frankie's Easy Diner

New leasehold premises have been acquired in Chatham, Kent. It is intended that this site will trade as "Frankie's Easy Diner". This is to be a family orientated American diner style hamburger concept and is expected to open in summer 2010.

Capital expenditure and cash flow

The Board has sought to preserve the cash resources of the Group where possible. As at the end of the period under review the Group held cash of £2.96 million (2008: £4.38 million).

Capital expenditure of £1.40 million was incurred in the period on the fitting-out of the Richoux restaurants in High Wycombe and Old Compton Street and the fitting-out of the new Zippers restaurant.

Outlook

Although trading conditions remain challenging the Group continues to develop new concepts and brands to complement the core Richoux business. Along with the two new sites which have recently been acquired measured expansion is being considered for the Group's brands if suitable sites can be found.

Philip Shotter

Chairman

Richoux Group plc

Consolidated statement of comprehensive income

for the 52 week period ended 27 December 2009

Richoux Group plc

Consolidated statement of changes in equity

For the 52 week period ended 27 December 2009

Richoux Group plc

Consolidated statement of financial position

at 27 December 2009

Richoux Group plc

Consolidated statement of cash flows

for the 52 week period ended 28 December 2009

1. The consolidated financial statements have been prepared in compliance with International Financial Reporting Standards ("IFRS") as adopted by the European Union and therefore the Group financial statements comply with Article 4 of the EU IAS Regulation. The financial statements have been prepared on the historical cost basis.

2. The financial information set out above does not constitute the Company's statutory accounts for the periods ended 28 December 2008 or 27 December 2009 but it is derived from those accounts. Statutory accounts for 28 December 2008 have been delivered to the Registrar of Companies and those for 27 December 2009 will be delivered following the Company's Annual General Meeting. The auditors 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.

3. Loss per share

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

4. No dividend is proposed.

5. Intangible fixed assets

Impairment testing of goodwill and intangible fixed assets

Goodwill of £269,000 (2008: £269,000) relates to the acquisition of Richoux Limited in August 2000 and is allocated to the group of cash generating units (CGUs) that comprise the business acquired with each restaurant site being treated as a single CGU.

Goodwill of £56,000 (2008: £56,000) relates to the acquisition of the Amato business in October 2007 and is allocated to the single restaurant acquired at that time operating under the Amato brand.

The Group tests annually for impairment or more frequently if there are indications that the goodwill may be impaired. The recoverable amounts of the restaurants are calculated from value in use calculations based on cash flow projections from formally approved budgets to December 2010, and forecasts to 27 December 2015 based on an EBITDA growth rate of 2% for the Richoux CGUs and 20% reducing to 2% for the new Zippers CGU. The discount rate applied to cash flow projections is 12%.

In the period an impairment charge of £1,000 has been recognised in relation to the software of one of the CGUs that comprise the Richoux business following the decision to close this unit (2008: an impairment charge of £35,000 was recognised in relation to the goodwill of one of the CGUs that comprise the Richoux business and impairment charges of £56,000 and £62,000 were recognised in relation to the goodwill and software respectively of the Amato business following the decision to discontinue this brand).

6. Property, plant and equipment

During the period the freehold property was transferred to investment property.

Impairment testing of property, plant and equipment

The Group considers each trading restaurant to be a cash-generating unit (CGU) and each CGU is reviewed when there are indications of impairment.

The recoverable amounts of the restaurants are calculated from value in use calculations based on cash flow projections from formally approved budgets to December 2010, and forecasts to 27 December 2015 based on an EBITDA growth rate of 2% for the Richoux CGUs and 20% reducing to 2% for the new Zippers CGU. The discount rate applied to cash flow projections is 12%.

In the period an impairment charge of £869,000 has been recognised relating to the unrecoverable elements of assets relating to the Richoux restaurants in High Wycombe and Old Compton Street following the decision to close these restaurants (2008: an impairment charge of £944,000 was recognised relating to the unrecoverable elements of assets relating to the three Amato CGUs following the decision to discontinue this brand, an impairment charge of £518,000 was recognised relating to the unrecoverable elements of the refurbishment and fixtures and fittings of the freehold property following the decision not to proceed with the Central Kitchen, and an impairment charge of £210,000 was recognised relating to the unrecoverable elements of assets relating to one Richoux CGU based on the forecast value in use).

7. Reconciliation of operating loss to operating cash flows

8. Report and accounts

Copies of the annual report and accounts will be posted to the shareholders shortly and will be available at www.richouxgroup.co.uk.