Comptoir Grp Regulatory News (COM)

All the above results are derived from continuing operations.

Consolidated balance sheet

At 3 July 2022

Consolidated statement of changes in equity

For the half-year ended 3 July 2022

Consolidated statement of cash flows

For the half-year ended 3 July 2022

Notes to the financial information

For the half-year ended 3 July 2022

1. Basis of preparation

The consolidated financial information for the half-year ended 3 July 2022, has been prepared in accordance with the accounting policies the Group applied in the Company's latest annual audited financial statements and are expected to be applied in the annual financial statements for the period ending 2 January 2022. These accounting policies are based on the UK-adopted International Financial Reporting Standards ("IFRS") and International Financial Reporting Interpretation Committee ("IFRIC") interpretations. The consolidated financial information for the half-year ended 3 July 2022 has been prepared in accordance with IAS 34: 'Interim Financial Reporting', as adopted by the UK, and under the historical cost convention.

The financial information relating to the half-year ended 3 July 2022 is unaudited and does not constitute statutory financial statements as defined in section 434 of the Companies Act 2006. The comparative figures for the period ended 2 January 2022 have been extracted from the consolidated financial statements, on which the auditors gave an unqualified audit opinion and did not include a statement under section 498 (2) or (3) of the Companies Act 2006. The annual report and accounts for the period ended 2 January 2022 has been filed with the Registrar of Companies.

The Group's financial risk management objectives and policies are consistent with those disclosed in the period ended 2 January 2022 annual report and accounts.

The half-yearly report was approved by the board of directors on 16 September 2022. The half-yearly report is available on the Comptoir Libanais website, www.comptoirlibanais.com, and at Comptoir Group's registered office, Unit 2, Plantain Place, Crosby Row, London Bridge, SE1 1YN.

2. Changes in accounting policies

The accounting policies adopted in the preparation of the consolidated financial information for the half-year ended 3 July 2022 are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the year ended 2 January 2022.

At the date of authorisation of the half-yearly report, the following amendments to Standards and Interpretations issued by the IASB that are effective for an annual period that begins on or after 2 January 2022. These amendments have not had any material impact on the amounts reported for the current and prior years.

Standard or Interpretation Effective Date

IAS 37 Onerous Contracts - Cost of Fulfilling a Contract 1 January 2022

Annual improvements to IFRS Standards 2018-2020 1 January 2022

IAS 16 Property, Plant and Equipment: Proceeds before Intended Use 1 January 2022

IFRS 3 Reference to the Conceptual Framework 1 January 2022

New and revised Standards and Interpretations in issue but not yet effective

At the date of authorisation of these financial statements, the Group has not early adopted the following amendments to Standards and Interpretations that have been issued but are not yet effective:

Standard or Interpretation Effective Date

IFRS 17 Insurance Contracts 1 January 2023

IAS 1 Classification of liabilities as current or non-current 1 January 2023

IAS 1 Disclosure of Accounting Policies 1 January 2023

IAS 8 Definition of Accounting Estimate 1January 2023

IAS 12 Deferred Tax Related to Assets and Liabilities Arising from a Single Transaction 1 January 2023

Initial Application of IFRS 17 and IFRS 9 - Comparative Information 1 January 2023

As yet, none of these have been endorsed for use in the UK and will not be adopted until such time as endorsement is confirmed. The directors do not expect any material impact as a result of adopting standards and amendments listed above in the financial year, they become effective.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated 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 of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. The resulting accounting estimates may differ from the related actual results.

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

In the process of applying the Group's accounting policies, management has made a number of judgments and estimations of which the following are the most significant. The estimates and assumptions that have a risk of causing material adjustment to the carrying amounts of assets and liabilities within the future financial years are as follows:

Depreciation, useful lives and residual values of property, plant & equipment

The Directors estimate the useful lives and residual values of property, plant & equipment in order to calculate the depreciation charges. Changes in these estimates could result in changes being required to the annual depreciation charges in the statement of comprehensive incomes and the carrying values of the property, plant & equipment in the balance sheet.

Impairment of assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets.

Critical accounting judgements and key sources of estimation uncertainty (continued)

Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value of money and the risks specific to the asset. Impairment losses of continuing operations are recognised in the profit or loss in those expense categories consistent with the function of the impaired asset. Please refer to note 8 for further details on impairments.

Leases

The Group has estimated the lease term of certain lease contracts in which they are a lessee, including whether they are reasonably certain to exercise lessee options. The incremental borrowing rate used to discount lease liabilities has also been estimated in the range of 2.6% to 4%. This is assessed as the rate of interest that would be payable to borrow a similar about of money for a similar length of time for a similar right-of-use asset.

Deferred tax assets

Historically, deferred tax assets had been recognised in respect of the total unutilised tax losses within the Group. A condition of recognising this amount depended on the extent that it was probable that future taxable profits will be available.

Restatement of prior year allocation of expenses

During the period ended 2 January 2022, the directors reclassified a number of expense items in order to ensure that the nature of the costs were included in the most appropriate profit or loss heading. The reclassifications were incorporated in the Group consolidated financial statements for the period ending 2 January 2022 and therefore the prior period statement of comprehensive income for the half-year ended 4 July 2021 has been restated to reflect this and ensure amounts are comparable.

The extract below summarises the total amounts that have been reclassified:

3. Group operating profit/(loss)

For the initial trading period following opening of a new restaurant, the performance of that restaurant will be lower than that achieved by other, similar, mature restaurants. The difference in this performance, which is calculated by reference to gross profit margins amongst other key metrics, is quantified and included within opening costs. The breakdown of opening costs, between pre-opening costs and post-opening costs is shown above.

4. Operating segments

The Group has only one operating segment: the operation of restaurants with Lebanese and Middle Eastern offering and one geographical segment (the United Kingdom). The Group's brands meet the aggregation criteria set out in paragraph 22 of IFRS 8 "Operating Segments" and as such the Group reports the business as one reportable segment. None of the Group's customers individually contribute over 10% of the total revenue.

5. Share options and share-based payment charge

On 4 July 2018, the Group established a Company Share Option Plan ("CSOP") under which 4,890,000 share options were granted to key employees. The CSOP scheme includes all subsidiary companies headed by Comptoir Group PLC. The exercise price of all of the options is £0.1025, which all carry a three-year vesting period and the term to expiration is ten years from the date of grant (4 July 2018).

On 21 May 2021, the Group established another Company Share Option Plan ("CSOP") under which 3,245,000 share options were granted to key employees. The CSOP scheme includes all subsidiary companies headed by Comptoir Group PLC. The exercise price of all of the options is £0.0723, which all carry a three-year vesting period and the term to expiration is ten years from the date of grant (21 May 2021).

The total share-based payment charge for the period was £14,450 (H1 2021: £25,046, 2 January 2022: £32,436).

6. Earnings/(loss) per share

The Company had 122,666,667 ordinary shares of £0.01 each in issue at 3 July 2022. The basic and diluted earnings/(loss) per share figures, is based on the weighted average number of shares in issue during the periods. The basic and diluted earnings/(loss) per share figures are set out below.

The basic and diluted earnings/(loss) per share is calculated by dividing the profit or loss attributable to ordinary shareholders by the weighted average number of shares and 'in the money' share options in issue. Share options are classified as 'in the money' if their exercise price is lower than the average share price for the period.

As required by 'IAS 33: Earnings per share', this calculation assumes that the proceeds receivable from the exercise of 'in the money' options would be used to purchase shares in the open market in order to reduce the number of new shares that would need to be issued. The shares were not 'in the money' as at the half-year ended 4 July 2021 or period ended 2 January 2022 and consequently would be antidilutive. Therefore, no adjustment was made in respect of the share options outstanding to determine the diluted number of options for these periods.

7. Intangible assets

Intangible fixed assets consist of goodwill from the acquisition of Agushia Limited, which included the Yalla Yalla brand. Goodwill arising on business combinations is not amortised but is subject to an impairment test annually which compares the goodwill's 'value in use' to its carrying value. No impairment of goodwill was considered necessary in the current period.

8. Property, plant and equipment

At each reporting date the Group considers any indication of impairment to the carrying value of its property, plant and equipment. The assessment is based on expected future cash flows and Value-in-Use calculations are performed annually and at each reporting date and is carried out on each restaurant as these are separate 'cash generating units' (CGU). Value-in-Use was calculated as the net present value of the projected risk-adjusted post-tax cash flows plus a terminal value of the CGU. A pre-tax discount rate was applied to calculate the net present value of pre-tax cash flows. The discount rate was calculated using a market participant weighted average cost of capital. A single rate has been used for all sites as management believe the risks to be the same for all sites.

8. Property, plant and equipment (continued)

The recoverable amount of each CGU has been calculated with reference to its Value-in-Use. The key assumptions of this calculation are shown below:

Growth rate 0%

Discount rate 5.3%

Number of years projected over life of lease

The value-in-use figure has been calculated using the expected annual cashflows of the Group from the latest forecasts at the time of review. In producing the forecasts, the Directors have considered the impact of current inflation levels, rising wage costs as well as the potential risk of recession.

The growth rate is based on a combination of industry average growth rates, actual results achieved historically and the current economic conditions. Sensitivity analysis was performed on the forecasted cashflows as well as the growth rate and only a significant reduction in cashflows would result in a material impairment charge. Therefore, based on the impairment review and sensitivity analysis carried out, an impairment charge of £nil (H1 2021: £336,356, 2 January 2022: £336,356) was recorded for the period.

9. Share capital

10. Cash flow from operations

Reconciliation of profit/(loss) to cash generated from operations:

11. Adjusted EBITDA

Adjusted EBITDA was calculated from the profit/loss before taxation adding back interest, depreciation, share-based payments and non-recurring costs incurred in opening new sites, as follows:

12. Subsequent events

On 1 August 2022, a new board was formed. The existing CEO and chairman having served for over 10 years, resigned. They were replaced by a new Non-Executive Chair, Dr Béatrice Lafon and a Non-Executive director, Mr Jean Michel Orieux. Mr Orieux is acting as interim CEO whilst the Group conducts a search for a permanent successor. The CFO and the Creative Director/Founder continue to serve on the board.