26th Jun 2008 14:56
Thursday 26 June 2008
PHOTO-ME INTERNATIONAL PLC
Quantification of One-Off Items in 2007/08
The Board's expectation as to the pre-tax loss, before additional depreciation and exceptional items, for the year to 30 April 2008, is unchanged since it gave guidance on 7 March 2008.
On 10 April 2008, Photo-Me (PHTM.L) announced that the Board had decided to reduce substantially the expected useful lives of photobooths and some other vending equipment. It also stated that the strategic review, which was being carried out, was expected to give rise to provisions for asset impairments and restructuring. The process of evaluation is now substantially complete (but subject to final audit), with a total quantification for one-off items in 2007/08 of approximately £20m.
The additional depreciation, arising from shorter asset lives, is expected to be approximately £5m and reflects the Board's decision to reduce, in general from eight years to five, the period in which most of the Group's photobooths and some of its vending equipment is depreciated. It will be accounted for as an operating expense.
The impairment charge is expected to be approximately £8m. £4m relates to operating equipment (much of it first generation digital media kiosks) and the balance to capitalised R&D, mainly in relation to minilabs. It will be accounted for as an exceptional item.
The restructuring charge totals approximately £7m, of which approximately £6m was included in the Interim Announcement of 17 December 2007. This charge, too, is an exceptional item.
Both the additional depreciation and the impairment charge are non-cash items.
Photo-Me proposes to issue its Preliminary Announcement of results for the year to 30 April 2008 no later than mid-July 2008. The Preliminary Announcement will also include details of the outcome of the strategic review.
Enquiries:
Bankside Consultants
Charles Ponsonby 020-7367 8851 or (today) 01372-455 591
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