Crawshaw Group Regulatory News (CRAW)

RNS Number : 8194T

Crawshaw Group PLC

05 October 2010

 

Crawshaw Group PLC   Interim Results   Crawshaw Group PLC ("the Company"), the meat focussed retailer, today reports its interim results for the 6 months ended 31 July 2010.

Highlights

·; Sales for the first half £9.4m (2009 : £9.5m).

·; Much improved sales trend towards end of period, with like-for-like sales down 4% to July versus 8% reduction reported at the year end (January 2010)

·; Retail margin up to 44.1% (2009 : 41.6%) and overall Gross Margin is up 5% to £4.1m (2009 : £3.9m).

·; Operating profit is much improved at £0.3m (2009 : £0.0m).

·; New store planned.

 

Overall sales for the first half reduced by less than 1% to £9.4m (2009 : £9.5m), whilst operating profit increased to £0.3m (2009: £0.0m) largely as a result of improving gross margins and careful cost control.

 

Towards the end of the period under review we began to see sales trends improving significantly. We started the period continuing the trend of the previous year, with like for like sales falling by 8%. However, a much improved sales performance towards the end of the first half has resulted in the cumulative trend improving, such that total sales over the full 6 months under review fell by just 1%.

 

We continue to drive customer loyalty which remains very high. Customers remain attracted by the combination of quality, choice, and value. Many of our newer stores have a higher proportion of hot cooked food and this focus is proving very successful.

 

Net debt at £1.0m has increased marginally from £0.9m at the year end. This is purely down to the timing of working capital movements in the first half of the year versus the second half due to the Christmas trading period. Cash generated from operating activities before movements in working capital in the period was £0.5m (2009 : £0.2m). This is more than offset by working capital movements £0.5m and capital expenditure £0.1m. We expect net debt will reduce further over the next 12 months, even as we continue to expand, as we remain very cash generative.

 

As previously reported, having opened seven new stores during the last two years we have gained a great deal of experience regarding the drivers of success. The larger format store type is proving particularly successful, not only measured by their initial performance, but also by their good continued growth. Accordingly it is this format that we are keen to roll out. A new site has recently been acquired that we plan to open as soon as possible.

 

Since the half year end, sales have continued to show positive like-for-like growth and I am therefore confident about the outlook for the full year and beyond.

 

Richard Rose

Chairman

5 October 2010

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 6 MONTHS ENDED 31/7/2010
		Unaudited	Audited	Unaudited
		6 Months	12 Months	6 Months
		31.7.10	31.1.10	31.7.09
	Note	£	£	£
Revenue	2	9,392,338	18,953,855	9,473,997
Cost of sales		(5,251,432)	(10,803,774)	(5,535,363)
Gross profit		4,140,906	8,150,081	3,938,634
Other operating income		1,832	7,530	7,742
Administrative expenses		(3,874,441)	(7,926,235)	(3,948,105)
Operating profit before one-off costs		268,297	318,231	85,126
Exceptional Items	3	-	(86,855)	(86,855)
Operating profit/(loss)		268,297	231,376	(1,729)
Finance income		1,395	524	513
Finance expenses		(16,652)	(63,931)	(42,673)
Net finance expense		(15,257)	(63,407)	(42,160)
Share of profit of equity accounted investees (net of tax)		(20,000	25,461	-
Profit/(Loss) before income tax		233,040	193,430	(43,889)
Income tax credit/(expense)	4	(85,966)	34,253	(41,963)
Profit/(Loss) for the period		147,074	227,683	(85,852)
Attributable to:
Equity holders of the Company		147,074	227,683	(85,852)
Basic profit/(loss) per ordinary share	5	0.254p	0.409p	(0.16p)
Diluted profit/(loss) per ordinary share	5	0.250p	0.401p	(0.16p)

 

 

CONDENSED CONSOLIDATED BALANCE SHEET AT 31 JULY 2010
		Unaudited	Audited	Unaudited
		31.7.10	31.1.10	31.7.09
ASSETS	Note	£	£	£
Non Current Assets
Property, plant and equipment		4,438,232	4,491,872	4,617,240
Intangible assets - goodwill and related Acquisition intangibles		7,668,064	7,685,404	7,702,744
Investment in equity accounted investees		115,207	135,207	109,746
Total Non Current Assets		12,221,503	12,312,483	12,429,730
Current Assets
Inventories		481,179	484,998	497,281
Trade and other receivables		341,059	409,429	659,099
Tax receivable		-	-	5,137
Cash and cash equivalents		212,237	800,381	-
Total Current Assets		1,034,475	1,694,808	1,161,517
Total Assets		13,255,978	14,007,291	13,591,247
SHAREHOLDERS' EQUITY
Share capital		2,890,940	2,890,940	2,890,940
Share premium		6,317,618	6,317,618	6,317,618
Reverse acquisition reserve		446,563	446,563	446,563
Capital contribution reserve		149,311	149,311	149,311
Retained earnings		(145,582)	(312,379)	(662,499)
Total Shareholders' Equity	6	9,658,850	9,492,053	9,141,933
LIABILITIES
Non Current Liabilities
Other payables		116,763	122,375	127,987
Interest bearing loans and borrowings		1,240,000	1,740,000	2,040,000
Deferred tax liabilities		545,943	485,342	499,196
Total Non Current Liabilities		1,902,706	2,347,717	2,667,183
Current Liabilities
Trade and other payables		1,694,422	2,167,521	1,766,772
Interest bearing loans and borrowings		-	-	15,359
Total Current Liabilities		1,694,422	2,167,521	1,782,131
Total Liabilities		3,597,128	4,515,238	4,449,314
Total Equity and Liabilities		13,255,978	14,007,291	13,591,247

 

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
	Share Capital £	Share Premium £	Rev Acq Reserve £	Capital Cont'n Reserve £	Retained Earnings £	Total Equity £
Balance at 1 February 2009	2,334,009	4,981,049	446,563	149,311	(613,232)	7,297,700
Loss for the Period	-	-	-	-	(85,852)	(85,852)
Share Based Payments	-	-	-	-	36,585	36,585
Loan note conversion	294,118	705,882	-	-	-	1,000,000
Issue of Shares	262,813	630,687	-	-	-	893,500
Balance at 31 July 2009	2,890,940	6,317,618	446,563	149,311	(662,499)	9,141,933
Balance at 1 August 2009	2,890,940	6,317,618	446,563	149,311	(662,499)	9,141,933
Profit for the period	-	-	-	-	313,535	313,535
Share based payment	-	-	-	-	36,585	36,585
Balance at 31 January 2010	2,890,940	6,317,618	446,563	149,311	(312,379)	9,492,053
Balance at 1 February 2010	2,890,940	6,317,618	446,563	149,311	(312,379)	9,492,053
Profit for the period	-	-	-	-	147,074	147,074
Share based payment	-	-	-	-	19,723	19,723
Balance at 31 July 2010	2,890,940	6,317,618	446,563	149,311	(145,582)	9,658,850

 

 

CONDENSED CONSOLIDATED CASH FLOW STATEMENT FOR THE 6 MONTHS ENDED 31 JULY 2010
	Unaudited	Audited	Unaudited
	6 Months	12 Months	6 Months
	31.7.10	31.1.10	31.7.09
Cash flows from operating activities	£	£	£
Profit/(Loss) for the period	147,074	227,683	(85,852)
Adjustments for:
Share based payments charge	19,723	73,170	36,585
Depreciation and amortisation	183,586	384,979	185,517
Loss on sale of property, plant and equipment	5,278	11,845	11,845
Net financial charges	15,257	63,407	43,265
Share of profit of equity accounted investees (net of tax)	20,000	(25,461)	-
Taxation	85,966	(34,253)	41,963
Operating cashflow before movements in working capital	476,884	701,370	233,323
Movement in trade and other receivables	68,371	100,460	(211,833)
Movement in trade and other payables	(504,075)	(187,180)	(582,372)
Movement in inventories	3,819	(23,477)	(35,760)
Tax paid	-	-	(4,875)
Net cash (used in)/ generated from operating activities	44,999	591,173	(601,517)
Cash flows from investing activities
Purchase of property, plant and equipment	(128,385)	(644,863)	(570,505)
Proceeds from sale of property, plant & equipment	10,500	22,450	4,900
Interest received	1,395	524	513
Interest paid	(16,652)	(63,931)	(43,778)
Net cash (used in)/ generated by investing activities	(133,142)	(685,820)	(608,870)
Cash flows from financing activities
Issue of Ordinary Shares(net of issue costs)	-	893,500	893,500
Repayment of loans	(500,000)	(1,462,018)	(1,252,017)
Bank Loan	-	-	90,000
Net cash (used in)/ generated from financing activities	(500,000)	(568,158)	(268,517)
Net change in cash and cash equivalents	(588,143)	(663,165)	(1,478,904)
Cash and cash equivalents at start of period	800,380	1,463,545	1,463,545
Cash and cash equivalents at end of period	212,237	800,380	(15,359)

 

 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

1. BASIS OF PREPARATION

 

BASIS OF PREPARATION

This unaudited interim financial information is for the 6 month period ended 31 July 2010 and is prepared in accordance with IAS 34 'Interim Financial Reporting', as adopted by the EU and under the historical cost convention.

 

The accounting policies applied are consistent with those of the annual financial statements for the year ended 31 January 2010, as described in those annual financial statements, which were prepared in accordance with IFRS as adopted by the EU.

 

 

INTERIM FINANCIAL INFORMATION

The interim financial information for the 6 month period ended 31 July 2010 has not been audited but has been reviewed by the auditors.

 

The comparative figures for the financial year ended 31 January 2010 are not the Company's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditors and delivered to the registrar of companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

 

SIGNIFICANT JUDGEMENTS, KEY ASSUMPTIONS AND ESTIMATION UNCERTAINTY

The preparation of interim financial statements in conformity with adopted IFRS requires management to make judgements, 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. Actual results may differ from these estimates.

 

GOING CONCERN

The Group has in place borrowing facilities up to a maximum of £1,840,000. These facilities are subject to financial performance covenants. They consist of a mortgage of £840,000 and a revolving credit facility of £1,000,000.

 

The revolving credit facility is due for renewal on 30 June 2011. The Directors have reviewed the banking facilities available to the Group plus the profit and cash forecasts of the Group with appropriate sensitivities around operational performance. The Directors have concluded that the Group will (i) meet the financial performance covenants to June 2011 and (ii) thereafter, be in a position to either pay back the revolving credit facility in full and negotiate a significantly reduced working capital facility or renew the revolving credit facility for use as and when required. Crawshaw Group PLC will open negotiations with its bank in due course and has not at this stage sought any written commitment. However, the Directors are not aware of any indications that facilities will not be made available at that time. Accordingly the Directors consider that these statements should be prepared on a going concern basis.

 

BASIS OF CONSOLIDATION

The consolidated financial information includes the financial information of the company and its subsidiary undertakings made up to 31 July 2010 (together referred to as the 'Group').

 

2. REVENUE

The directors have undertaken a review of the Group's continuing operations and its associated business risks and consider that the continuing operations should be reported as a single business segment. The directors consider that the continuing operations represent one product offering with similar risks and rewards and should be reported as a single business segment in line with the Group's internal reporting framework. All revenue received during the period was received from customers within the United Kingdom.

 

3. EXCEPTIONAL ITEMS

 

	Unaudited	Audited	Unaudited
	6 Months	12 Months	6 Months
	31.7.10	31.1.10	31.7.09
	£	£	£
Directors Loss of Office	-	86,855	86,855
A.Richardson resigned as a director of the Company on 8 May 2009, compensation for loss of office and associated legal costs total £86,855.

 

4. INCOME TAX EXPENSE

 

	Unaudited	Audited	Unaudited
	6 Months	12 Months	6 Months
	31.7.10	31.1.10	31.7.09
	£	£	£
The income tax expense is based on the estimated effective rate of taxation on trading for the period and represents:
Current tax	25,365	-	-
Deferred tax:
Origination and reversal of timing differences	60,601	29,850	41,963
Adjustments for prior year	-	(64,103)	-
Sub Total	60,601	(34,253)	41,963
Total tax (credit)/expense	85,966	(34,253)	41,963

 

 

5. EARNINGS PER ORDINARY SHARE

Basic earnings per ordinary share is calculated by dividing the earnings attributable to the ordinary shareholders by the weighted average number of ordinary shares outstanding during the period of 57,818,801 (31/1/10: 55,686,461) (31/07/09: 53,518,778).

 

Diluted EPS is calculated by dividing the profit for the year attributable to the ordinary shareholders by the weighted average number of ordinary shares in issue adjusted to assume conversion of all options from the start of the year, giving a figure of 58,922,623.

(31/1/10:56,790,283)

 

6. CAPITAL AND RESERVES

 

	Share	Share	Rev. Acq.	Capital	Retained	Total
	Capital	Premium	Reserve	Cont. Res.	Earnings	Equity
	£	£	£	£	£	£
Balance at 1 February 2009	2,334,009	4,981,049	446,563	149,311	(613,232)	7,297,700
Profit for the period	-	-	-	-	227,683	227,683
Share based payment	-	-	-	-	73,170	73,170
Loan note conversion	294,118	705,882	-	-	-	1,000,000
Issue of Shares	262,813	630,687	-	-	-	893,500
Balance at 31 January 2010	2,890,940	6,317,618	446,563	149,311	(312,379)	9,492,053
Profit for the period	-	-	-	-	147,074	147,074
Share based payment	-	-	-	-	19,723	19,723
Balance at 31 July 2010	2,890,940	6,317,618	446,563	149,311	(145,582)	9,658,850

 

Share Issues

On 10 February 2009 the directors and key employees of the Company converted £1,000,000 loan notes into 5,882,353 ordinary shares increasing the issued share capital by £294,118.

 

On 19 June 2009 ISIS Equity Partners LLP subscribed for 5,256,254 ordinary shares at 17p per share raising £893,500 to support the Company's store rollout strategy.

 

7. SHARE CAPITAL

 

	31.7.10	31.1.10	31.7.09
Authorised	£	£	£
96,678,257 ordinary shares of 5p each	4,833,913	4,833,913	4,833,913
Allotted, called up and fully paid	£	£	£
57,818,801 ordinary shares of 5p each	2,890,940	2,890,940	2,334,009

 

8. RELATED PARTY TRANSACTIONS

Crawshaw Butchers Limited, a subsidiary of Crawshaw Holdings Limited, holds a 50% share in a partnership which trades under the name of RGV Refrigeration. The operations of the partnership comprise of the maintenance and repair of refrigeration machinery for a variety of customers.

 

A copy of the full interim report will be sent to all shareholders in the week commencing 11 October 2010 and will also be available from the company's registered office : Unit 16 Bradmarsh Business Park, Bow Bridge Close, Rotherham, S60 1BY. In addition, a copy will also be published on the Company's website www.crawshawgroupplc.com.

 

 

 

Enquiries:

 

Crawshaw Group plc	01709 369 602
Lynda Sherratt
W H Ireland Limited	0161 832 2174
Robin Gwyn

 

This information is provided by RNS

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