ACT.L Regulatory News (ACT)

27 Apr 2005 07:00

Actif Group PLC27 April 2005 27 April 2005 Actif Group plc Announcement of interim results for the six months ended 29 January 2005 Highlights • Group turnover up 5% to £14.8 million (2004: £14.1 million) • Operating profit level at £317,000 (2004: £318,000) • Profit before tax down by 9.8% to £248,000 (2004: £275,000) • Cash generated from operating activity increased by 143% to £1.1 million (2004: £0.5 million) • Net debt reduced by 54% to £0.6 million (2004: £1.3 million) • New Elle flagship prime retail store opened in Croydon • Earnings per share decreased by 11.9% to 0.37 pence (2004: 0.42 pence) • New Reebok swimwear licence for UK secured Enquiries: ACTIF GROUP PLC gcg hudson sandler Mark Evans, Chief Executive Wendy Baker Tel: +44 (0)20 7462 8801 Tel: +44 (0)20 7796 4133 Julian Ghinn, Finance Director Tel: +44 (0)20 7462 8810 27 April 2005 Actif Group plc Interim results for the six months ended 29 January 2005 CHAIRMAN'S STATEMENT I am pleased to report the Group's interim results for the six-month period to31 January 2005. Results In the six months to 31 January 2005, total Group turnover was 5.0% up on theprevious year at £14.8 million (2004: £14.1 million). Operating profit wasbroadly level at £317,000 (2004: £318,000) with total profit before taxdecreasing by 9.8% to £248,000 (2004: £275,000). Net debt has decreased by 54% to £0.6 million (2004: £1.3 million). Basicearnings per share has decreased by 11.9% to 0.37p (2004: 0.42p). ELLE Retail Retail sales in the period amounted to £8.1 million (2004: £8.6 million),accounting for 54% of total Group turnover (2004: 60%). Retail gross marginsincreased by 1.6% to 64.8% (2004: 63.2%). First half retail sales to end January in total were 1% down on a like for likebasis and down by 5.8% on a total basis following the rationalisation of thestore portfolio last year. An encouraging sign within the retail business wasthat prime stores were up 7% on a like for like basis across the same period,providing evidence that the actions taken to improve the product offer arehaving a positive impact on retail performance. We continue to strengthen thedesign and buying team as we seek to build on this success. A new flagship store was opened in the new Croydon Centrale development, takingthe total retail footage to 47,500 net square feet. Wholesale Overall wholesale sales in the first half amounted to £6.8 million (2004: £5.6million), reflecting an underlying increase of 14% of Elle sales. Whilst therate of increase has slowed from that achieved last year, we are pleased thatthe investment being made in improving the product fashionability, styling,quality and sales channel management continues to positively impact on this partof the business, albeit that it now faces a more challenging tradingenvironment. Debt and cash management Our continued strong management of cash resulted in cash generated fromoperating activity improving by 143% to £1.1 million (2004: £0.5 million). Netdebt decreased by 54% to£0.6 million (2004: £1.3 million) in line with our plan to achieve a reductionin total debt by the year end. Reebok swimwear licence Underlying our strategic ambition to operate additional premium brand licences,the group has secured a three year licence to design and distribute on awholesale basis Reebok branded swimwear. This represents a low risk investmentfor the Group and offers earnings enhancement opportunities for the future. Itwill not have any financial impact until the second half of the 2005/6 financialyear and is not expected to be a material contributor to profit in the firsttrading year. Outlook There is growing evidence of a major change in demand from consumers andwholesale buyers since the beginning of March. In retail, this is reflected in a4% decrease in total retail sales for the first 11 weeks of the second half to16 April, with like for like sales 1.5% down. In wholesale, customer repeatorders for Spring / Summer 2005 are below expectations, whilst early indicationsare of a cautious approach amongst buyers in placing Autumn / Winter 2005orders. We do not anticipate any improvement in the market conditions, which remainchallenging. On this basis we have realigned our expectations for the secondhalf and as a result, we now anticipate full year profits for the currentfinancial year to be broadly similar to last year. Whilst this will be frustrating to shareholders we do believe that the necessaryelements are present in the business to benefit from any change in the marketconditions going forward. David BrockChairman27 April 2005 CONSOLIDATED PROFIT AND LOSS ACCOUNTFor the 6 months to 29 January 2005 Unaudited Unaudited Audited Six months to Six months to Year to Notes 29 January 2005 31 January 2004 31 July 2004 £'000 £'000 £'000Turnover 14,808 14,096 27,643Cost of Sales (7,759) (6,982) (16,135) __________ __________ __________Gross Profit 7,049 7,114 11,508 Other Operating Expenses (6,732) (6,796) (11,319) __________ __________ __________Operating profit 317 318 189 Interest payable and similar charges (69) (43) (104) __________ __________ __________Profit on ordinary activities before taxation 248 275 85 __________ __________ __________ Taxation - - (22) __________ __________ __________Retained profit for the period 248 275 63 __________ __________ __________ Earnings per share Basic earnings per share 2 0.37p 0.42p 0.10p __________ __________ __________Diluted earnings per share 0.37p 0.39p 0.09p __________ __________ __________ CONSOLIDATED BALANCE SHEETAs at 29 January 2005 Unaudited Unaudited Audited 29 January 2005 31 January 2004 31 July 2004 £'000 £'000 £'000Fixed assetsIntangible assets 41 43 42Tangible assets 1,901 2,089 1,897 __________ __________ __________ 1,942 2,132 1,939Current assetsStocks 3,505 3,962 3,840Debtors 3,571 3,404 4,374Cash at bank and in hand 611 87 6 __________ __________ __________ 7,687 7,453 8,220Creditors: amounts falling due within one year (4,491) (4,436) (5,270) __________ __________ __________Net current assets 3,196 3,017 2,950 __________ __________ __________Total assets less current liabilities 5,138 5,149 4,889Creditors: amounts falling due after more than one year (611) (670) (610) __________ __________ __________Net assets 4,527 4,479 4,279 __________ __________ __________Capital and reservesCalled up share capital 666 657 666Share premium account 4,326 4,322 4,326Other reserves 89 89 89Profit and loss account (554) (589) (802) __________ __________ __________Shareholders' funds 4,527 4,479 4,279 __________ __________ __________ CONSOLIDATED CASH FLOW STATEMENTFor the 6 months to 29 January 2005 Notes Unaudited Unaudited Audited 6 months to 6 months to Year to 29 January 2005 31 January 2004 31 July 2004 £'000 £'000 £'000 Net cash inflow from operating activities 3(a) 1,166 469 554 Returns on investments and servicing of financeInterest paid (69) (43) (104) ________ ________ ________Net cash outflow from servicing of finance (69) (43) (104) ________ ________ ________ Capital expenditure and financial investmentPurchase of tangible fixed assets (284) (560) (646) ________ ________ ________Net cash outflow from capital expenditure (284) (560) (646) ________ ________ ________ Net cash inflow/(outflow) before financing 813 (134) (196) Issue of ordinary shares - - 13Repayment of secured loans (95) (123) (196)New secured loans - 900 900Capital element of finance lease payments (51) (51) (72) ________ ________ ________Net cash (outflow)/ inflow from financing (109) 753 645 ________ ________ ________ Increase in cash in the period 3(b) 667 592 449 ________ ________ ________ NOTES TO THE INTERIM FINANCIAL STATEMENTS 1. Basis of preparation The consolidated interim financial statements have been prepared under thehistorical cost convention and in accordance with applicable accountingstandards. The accounting policies applied are consistent with those set out inthe financial statements of Actif Group plc for the year ended 31 July 2004.The interim financial statements are unaudited and do not constitute accountswithin the meaning of section 240 of the Companies Act 1985. The financialinformation for the year ended 31 July 2004 has been extracted from the Group'sstatutory accounts for the period, which have been delivered to the Registrar ofCompanies. The auditors' report on those accounts was unqualified and did notcontain any statement under section 237 of the Companies Act 1985. 2. Earnings per share Earnings per share and fully diluted earnings per share for the 6 months ended29 January 2005, the year ended 31 July 2004 and the 6 months ended 31 January2004 have been calculated on profit after tax and non-equity dividends and onthe weighted average number of shares in issue and under option during theperiod, as set out below: 6 months ended 6 months ended Year ended 29 January 2005 1 February 2004 31 July 2004 66,171,471 65,344,571 65,602,836Weighted average number of ordinary shares --------------------- ---------------------- ----------------------Weighted average number of ordinary and potential ordinary shares 67,345,306 70,025,726 69,304,719 --------------------- ---------------------- ---------------------- 3. Notes to the Consolidated Cash Flow Statement for the 6 months ended 29January 2005 (a) Reconciliation of operating profit to operating cash flows Unaudited Unaudited Audited 6 months to 6 months to Year to 29 January 2005 31 January 2004 31 July 2004 £'000 £'000 £'000Operating profit 317 318 189Depreciation charges 280 386 697Amortisation of goodwill 1 1 3Profit on disposal of fixed assets - - (4)Decrease/(increase) in stock 335 (577) (454)Decrease/(increase) in debtors 803 406 (587)(Decrease)/increase in creditors (570) (65) 710 __________ __________ __________Net cash inflow from operating activities 1,166 469 554 __________ __________ __________ (b) Reconciliation of cash flow to movement in net debt Unaudited Unaudited Audited 6 months to 6 months to Year to 29 January 2005 31 January 2004 31 July 2004 £'000 £'000 £'000Increase in cash in the period 667 592 449Cash outflow/(inflow) from decrease/(increase) in debt and lease 119 (726) (632)financing _________ __________ __________Change in net debt resulting from cash flows 786 (134) (183)New finance leases - (27) (57) __________ __________ __________Movement in net debt in the period 786 (161) (240)Net debt at the beginning of the period (1,356) (1,116) (1,116) __________ __________ __________Net debt at the end of the period (570) (1,277) (1,356) __________ __________ __________ 4. Copies of Interim Report The Interim Report will be sent by post to all registered shareholders. Copiesof the Interim Report are available from the Company Secretary at the RegisteredOffice of Actif Group plc, 20 Little Portland Street, London W1W 8AA. This information is provided by RNS The company news service from the London Stock Exchange