Heavitree Regulatory News (HVT)

RNS Number : 9403G

Heavitree Brewery PLC

16 February 2010

 

The Heavitree Brewery PLC

Trood Lane

Matford

Exeter EX2 8YP

 

Date: 16 February 2010

 

Contact: Graham Crocker - Managing Director - 01392 217733

Rod Glanville - Director and Company Secretary - 01392 217733

Pascal Keane - Shore Capital - 0207 408 4090

 

 

Following a Board Meeting held today, 16 February 2010, the Directors announce the preliminary statement of results for the year ended 31 October 2009.

 

ISIN: GB0004182720 for 'A' Limited Voting Ordinary Shares

ISIN: GB0004182506 for Ordinary Shares

 

Chairman's statement

 

The successful restructuring of the Company by the return of houses in our former Managed House operation, Heavitree Inns Limited, to the tenanted and leased estate has resulted in a drop in turnover for the year due to the loss in associated retail sales. The restructure has also brought with it exceptional costs for the year which I reported on at the half-year. However I am pleased to be able to report on a marked improvement in both trading profit and underlying profitability.

The accounts for the year under review separate our business into "Discontinued Operations" and "Continuing Operations" in order to clarify the wind-up of Heavitree Inns.

Results

Turnover for the Group decreased against last year by 29.8% but generated a Group Operating Profit of £1,046,000 (2008: £554,000) after consolidation adjustments.

Heavitree Inns (having ceased trading at the year end) generated an Operating Loss of £279,000 (2008: Profit - £86,000).

Heavitree Inc. generated an Operating Loss of £13,000 (2008: Loss - £8,000).

Dividend

The Directors recommend a final dividend of 3.5p per Ordinary and 'A' Limited Voting Ordinary Share (2008: 7p) making an overall total for the year of 7p, which is unchanged from last year. The dividend will be paid on 16 April 2010, subject to shareholder approval at the Annual General Meeting on 14 April 2010, to shareholders on the Register at 12 March 2010.

Property Sales

During the year the following properties, which were all held as 'Assets held for sale' as at 31 October 2008, were sold:

The Steam Packet Inn, Topsham.

The Heavitree Arms, Bideford.

The Old Rydon Inn, Kingsteignton.

The King's Arms, South Zeal.

The Dawlish Inn, Teignmouth.

The Hub, Exeter, which was not considered for disposal in the last financial year was also sold as was a small piece of land in Sandford, Crediton.

Together, the sale of these properties realised a book profit before taxation of £781,000.

At the time of writing no further houses are being marketed for sale.

Capital Investments

In the year under review there are no major capital works to report.

Pension Scheme

Following the decision that the Company will meet its funding obligations to its closed final salary Pension Scheme, I can confirm that the required deficit correction payment will be annualised over a period of eight years. During this time the deficit will also be subject to further triennial actuarial funding reviews.

Repurchase of Shares

The Company did not purchase any of its own shares during the year under review but the Directors intend to seek shareholder approval at the forthcoming AGM for the continued authority to do so.

Outlook

Our restructure has allowed us to simplify our operation, improve our efficiencies and enhance support in our tenanted and leased estate of houses. We remain focussed on our strategy of returning a dividend to shareholders at a time when other companies in our sector have chosen not to do so. The industry continues to be subject to many well documented pressures and the economy as a whole is dogged by uncertainty. The offer of the pub itself has changed irreversibly from what it once was. The team at this Company are working hard to recognise and embrace all the opportunities that these changes are creating and are looking to satisfy the demands of an increasingly discerning market. I would like to thank all our Tenants, Leaseholders and staff in helping to return a good and steady performance for the Company after a year of restructure during difficult trading times.

 

 

 

 

 

N H P TUCKER

Chairman

 

 

Group income statement

for the year ended 31 October 2009

 

 

	Notes	Discontinued Operations 2009 £000	Continuing Operations 2009 £000	Total 2009 £000	Discontinued Operations 2008 £000	Continuing Operations 2008 £000	Total 2008 £000
Revenue		2,152	7,058	9,210	6,838	6,276	13,114
Change in stocks		(144)	-	(144)	(33)	(13)	(46)
Other operating income		-	83	83	-	63	63
Purchase of inventories		(743)	(2,899)	(3,642)	(2,756)	(2,130)	(4,886)
Staff costs		(766)	(1,234)	(2,000)	(2,358)	(1,431)	(3,789)
Depreciation of property, plant and equipment		(100)	(352)	(452)	(244)	(318)	(562)
Other operating charges		(678)	(1,331)	(2,009)	(1,361)	(1,979)	(3,340)
		(2,431)	(5,733)	(8,164)	(6,752)	(5,808)	(12,560)
Group operating profit/(loss)		(279)	1,325	1,046	86	468	554
Profit/(loss) on disposal of non-current assets and assets held for sale		(96)	877	781	3	925	928
Restructuring and finance costs		(103)	(267)	(370)	-	-	-
Group profit/(loss) before finance costs and taxation		(478)	1,935	1,457	89	1,393	1,482
Finance income		-	26	26	-	34	34
Finance costs		-	(153)	(153)	-	(420)	(420)
Other finance costs - pensions		-	(77)	(77)	-	(74)	(74)
		-	(204)	(204)	-	(460)	(460)
Profit/(loss) before taxation		(478)	1,731	1,253	89	933	1,022
Tax (expense)/credit		33	(175)	(142)	(9)	120	111
Profit/(loss) for the year attributable to equity holders of the parent		(445)	1,556	1,111	80	1,053	1,133
Basic earnings per share	2	(8.7)p	30.4p	21.7p	1.5p	20.4p	21.9p
Diluted earnings per share	2	(8.7)p	30.4p	21.7p	1.5p	20.4p	21.9p

 

 

 

 

 

 

 

Group statement of recognised income and expense

for the year ended 31 October 2009

 

		2009 £000		2008 £000
Income and expense recognised directly in equity
Actuarial (losses)/gains on defined benefit pension plans		(1,456)		386
Tax credit/(expense)on items taken directly to or transferred from equity		410		(92)
Exchange difference on retranslation of subsidiary		-		2
Fair value adjustment		(8)		(54)
Net(expense)/ income recognised directly in equity		(1,054)		242
Profit for the year		1,111		1,133
Total recognised income and expense for the year		57		1,375

 

 

Group balance sheet

at 31 October 2009

		2009 £000		2008 £000
Non-current assets
Property, plant and equipment		13,683		14,682
Financial assets		50		58
Deferred tax asset		598		295
		14,331		15,035
Current assets
Inventories		19		163
Trade and other receivables		1,668		1,796
Cash and short-term deposits		521		324
		2,208		2,283
Assets held for sale		-		795
Total assets		16,539		18,113
Current liabilities
Trade and other payables		(915)		(1,582)
Financial liabilities		-		(6,479)
Income tax payable		(77)		(104)
		(992)		(8,165)
Non-current liabilities
Other payables		(272)		(232)
Financial liabilities		(5,011)		(11)
Deferred tax liabilities		(261)		(367)
Defined benefit pension plan		(2,088)		(1,005)
		(7,632)		(1,615)
Total liabilities		(8,624)		(9,780)
Net assets		7,915		8,333
Capital and reserves
Equity share capital		264		264
Capital redemption reserve		673		673
Treasury shares		(994)		(1,248)
Fair value adjustments reserve		30		38
Currency translation		3		3
Retained earnings		7,939		8,603
Total equity		7,915		8,333

 

Group statement of cash flows

for the year ended 31 October 2009

 

	Notes	2009 £000		2008 £000
Operating activities
Profit for the year		1,111		1,133
Tax		142		(111)
Net finance costs		204		460
Profit on disposal of non current assets and assets held for sale		(781)		(928)
Depreciation and impairment of property, plant and equipment		452		767
Share-based payments		13		13
Difference between pension contributions paid and amounts
recognized in the income statement		(450)		(158)
Decrease in inventories		144		47
Increase/(decrease) in trade and other receivables		129		(297)
Decrease in trade and other payables		(626)		(17)
Cash generated from operations		338		909
Income tax paid		(169)		(169)
Net cash flow from operating activities		169		740
Investing activities
Interest received		26		32
Proceeds from sale of property, plant and equipment and assets held for sale		2,184		2,252
Payments to acquire property, plant and equipment		(61)		(1,558)
Dividends received		-		1
Net cash flow from investing activities		2,149		727
Financing activities
Interest paid		(153)		(419)
Preference dividend paid		(1)		(1)
Dividends paid	3	(537)		(370)
Repayment of loans from Directors'		-		(74)
Consideration received by EBT on sale of shares		49		145
Consideration paid by EBT on purchase of shares		-		(366)
Repurchase of share capital		-		(1,899)
Net movement in long term borrowings		5,000		-
Net cash flow from financing activities		4,358		(2,984)
Increase)/(decrease) in cash and cash equivalents		6,676		(1,517)
Cash and cash equivalents at the beginning of the year		(6,155)		(4,638)
Cash and cash equivalents at the year end		521		(6,155)

 

 

Group reconciliation of movements in equity

 

	Equity share capital £000	Capital redemption reserve £000	Treasury shares £000	Fair value adjustments reserve £000	Currency translation £000	Retained earnings £000	Total equity £000
At 1 November 2007	273	664	(963)	92	1	9,368	9,435
Total recognised income
and expense for the year	-	-	-	(54)	2	1,427	1,375
Transfer in respect of the
buy back of own shares	(9)	9	-	-	-	(1,899)	(1,899)
Consideration paid by
EBT on purchase
of shares	-	-	(366)	-	-	-	(366)
Consideration received
by EBT on sale of
Shares	-	-	145	-	-	-	145
Gain by EBT on sale
of shares	-	-	(64)	-	-	64	-
Share based payment	-	-	-	-	-	13	13
Equity dividends paid	-	-	-	-	-	(370)	(370)
At 31 October 2008	264	673	(1,248)	38	3	8,603	8,333

 

 

	Equity share capital £000	Capital redemption reserve £000	Treasury shares £000	Fair value adjustments reserve £000	Currency translation £000	Retained earnings £000	Total equity £000
At 31 October 2008	264	673	(1,248)	38	3	8,603	8,333
Total recognised income
and expense for the year	-	-	-	(8)	-	65	57
Consideration received
by EBT on sale of
Shares	-	-	49	-	-	-	49
Loss by EBT on sale
of shares	-	-	205	-	-	(205)	-
Share based payment	-	-	-	-	-	13	13
Equity dividends paid	-	-	-	-	-	(537)	(537)
At 31 October 2009	264	673	(994)	30	3	7,939	7,915

 

 

 

 

Equity share capital

The balance classified as share capital includes the total net proceeds (both nominal value and share premium) on issue of the Company's equity share capital, comprising Ordinary Shares of 5p each and 'A' Limited Voting Ordinary Shares of 5p each.

 

Capital Redemption Reserve

The capital redemption reserve arises on the re-purchase and cancellation by the Company of Ordinary Shares.

 

Treasury shares

Treasury shares represents the cost of The Heavitree Brewery PLC shares purchased in the market and held by The Heavitree Brewery PLC Employee Benefit Trust and Employee Share Option Scheme('EBT') .

At 31 October 2009 the Group held 58,779 Ordinary Shares and 87,332 'A' Limited Voting Ordinary Shares (2008: 58,779 Ordinary Shares and 120,393 'A' Limited Voting Ordinary Shares) of its own shares at an average cost of £5.82 (2008: £6.81). The market value of these shares as at 31 October 2009 was £359,000 (2008: £776,000)

Fair value adjustments reserve

The fair value adjustments reserve is used to record differences in the market value of the available-for-sale investment year on year.

Foreign currency translation reserve

The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign subsidiaries.

 

 

 

 

Notes to the preliminary announcement

 

1. Basis of preparation

 

These figures do not constitute full accounts within the meaning of Section 396 of the Companies Act 2006. They have been extracted from the statutory financial statements for the year ended 31 October 2009. The statutory financial statements have not yet been delivered to the Registrar of Companies. They have been prepared on the basis of the accounting policies as set out in the Group's IFRS Restatement Announcement issued on 22 July 2008, and which is available upon request. Further disclosure concerning the impact of IFRS on the financial statements of the Group can also be found in that document including the reconciliations required by IFRS 1 'First Time Adoption of International Financial Reporting Standards'. The accounting policies are drawn up in accordance with International Accounting Standards (IAS) and International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board.

 

2. Basic and diluted earnings per share

Basic earnings per share amounts are calculated by dividing profit for the year attributable to ordinary equity holders of the parent by the weighted average number of Ordinary shares and 'A' Limited Voting Ordinary shares outstanding during the year.

Diluted earnings per share amounts are calculated by dividing the profit attributable to ordinary equity holders of the parent by the weighted average number of Ordinary shares and 'A' Limited Voting Ordinary shares outstanding during the year as diluted for the share options in issue.

The following reflects the income and shares data used in the basic and diluted earnings per share computations:

 

	2009 £000	2008 £000
Profit for the year	1,111	1,133
	2009 No. (000)	2008 No. (000)
Basic weighted average number of shares (excluding treasury shares)	5,117	5,165
Dilutive potential ordinary shares:
Employee share options	-	-
Diluted weighted average number of shares	5,117	5,165

 

 

There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of completion of these financial statements.

Employee share options could potentially dilute basic earnings per share in the future but are not included in the 2009 calculation of dilutive earnings per share because they are antidilutive for the period presented.

3. Dividends paid and proposed

 

	2009 £000	2008 £000
Declared and paid during the year:
Equity dividends on ordinary shares:
Final dividend for 2008: 7p (2007: 7p)	369	381
First dividend for 2009: 3.5p (2008: Nil)	185	-
Less dividend on shares held within employee share schemes	(17)	(11)
Dividends paid	537	370
Proposed for approval at AGM
(not recognised as a liability as at 31 October)
Final dividend for 2009: 3.5p (2008: 7p)	180	357

 

 

4. Segment information Primary reporting format - business segments

The primary segmental reporting format is determined to be business segments as the Group's risks andrates of return are affected predominantly by differences in the products and services provided.

During the year the Group operated in two business segments; leased estate and managed estate.

Leased estate represents properties which are leased to tenants to operate independently from the Group.

Managed estate represents properties which were owned, operated and maintained by the Group and represents the discontinued operations.

Segment information
Year ended 31 October 2009	Leased £000	Managed £000	Eliminations £000	Total £000
Revenue
Sales to external customers	7,058	2,152	-	9,210
Inter-segment sales	357	-	(357)	-
Segment revenue	7,415	2,152	(357)	9,210
Results
Segment results	1,858	(478)	-	1,380
Unallocated expenses				(127)
Profit before taxation				1,253
Tax credit				(142)
Profit for the year				1,111
Assets and liabilities
Segment assets	15,941	-	-	15,941
Unallocated assets				598
Total assets				16,539
Segment liabilities	(8,259)	-	-	(8,259)
Unallocated liabilities				(365)
Total liabilities				(8624)
Other segment information
Capital expenditure:
Property, plant and equipment	57	4	-	61
Depreciation	352	100	-	452
Year ended 31 October 2008	Leased £000	Managed £000	Eliminations £000	Total £000
Revenue
Sales to external customers	6,276	6,838	-	13,114
Inter-segment sales	1,262	-	(1,262)	-
Segment revenue	7,538	6,838	(1,262)	13,114
Results
Segment results	1,319	89	-	1,408
Unallocated expenses				(386)
Profit before taxation				1,022
Tax credit				111
Profit for the year				1,133
Assets and liabilities
Segment assets	17,184	1,462	(828)	17,818
Unallocated assets				295
Total assets				18,113
Segment liabilities	(8,741)	(1,396)	828	(9,309)
Unallocated liabilities				(471)
Total liabilities				(9,780)
Other segment information
Capital expenditure:
Property, plant and equipment	1,304	254	-	1,558
Depreciation	318	244	-	562
Impairment of assets held for sale	205	-	-	205

 

Secondary reporting format - geographical segments

The following tables present revenue, expenditure and certain asset information regarding the Group's geographical segments for the years ended 31 October 2009 and 2008. Revenue is based on the geographical location of customers and assets are based on the geographical location of the asset.

 

Year ended 31 October 2009	UK £000	United States £000	Total £000
Revenue
Sales to external customers	9,210	-	9,210
Other segment information
Segment assets	15,890	51	15,941
Unallocated assets			598
Total assets			16,539
Capital expenditure
Property, plant and equipment	61	-	61
Year ended 31 October 2008	UK £000	United States £000	Total £000
Revenue
Sales to external customers	13,114	-	13,114
Other segment information
Segment assets	17,753	65	17,818
Unallocated assets			295
Total assets			18,113
Capital expenditure
Property, plant and equipment	1,537	21	1,558

 

 

5. General information

The 2009 Annual Report and Financial Statements will be published and posted to shareholders on 10 March 2010. Further copies may be obtained by contacting the Company Secretary at The Heavitree Brewery PLC, Trood Lane, Matford, Exeter EX2 8YP. The 2009 Annual Report and Financial Statements will also be available on the Company's website at http://www.heavitreebrewery.co.uk/financial/

 

 

The Annual General Meeting will be held at the Registered Office on 14 April 2010 at 11.30am.

 

.

 

Ends. 

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