IQ-AI Regulatory News (IQAI)

20 April 2010

Flying Brands Limited

Interim Management Statement

Flying Brands Limited announces its Interim Management Statement as required by the FSA's Disclosure and Transparency rules. The financial commentary covers the first thirteen weeks of Flying Brands' current financial year, from 2 January to 2 April 2010. 

Trading

At the time of our preliminary results on 10 March 2010, we announced that trading overall had got off to a satisfactory start but that sales in our Garden division had been behind management expectations as a result of poor weather. These conditions continued into March and, as a result, sales of bedding plants during the peak Spring selling season have continued to be behind expectations. 

Our business has not so far been affected by the current air travel restrictions and, where it does look as if our normal sources of flowers will be affected by a continuation of these restrictions beyond this week, we have been assured that there will be alternative sources of product available. We do not therefore anticipate that our business will be affected to any material extent by the current crisis.

At 2 April the value of orders taken in the Garden Division was £8.0m (2009: £8.4m). We believe that our sales held up relatively well in a difficult environment and were pleased that Web sales in this division increased from £1.5m in 2009 to £1.8m this year representing 22.8% of total sales (2009: 17.5%). We will be extending our Spring selling season to claw back at least some of this shortfall. We have continued to recruit new customers and remain confident of the overall prospects for the Garden Division aside from what we believe to be this short-term weather-related setback.

Flying Flowers' orders to 2 April 2009 were £2.3m compared with £3.1m in the equivalent period last year, £0.2m of this shortfall was attributable to the loss of Low Value Consignment Relief and a large part of the remainder was due to a deliberate decision on our part to eliminate loss-making catalogue sales at Mother's Day. Contribution for this brand remains in line with our expectations. We continued our efforts to move more of the Flying Flowers business to the Web and our Web Sales for the period increased to £1.4m from £1.1m in 2009. Web sales accounted for over 53% of Flying Flowers's total sales in the period (2009: 36%).

Revenue for the Entertainment division was £1.0m (2009: £1.3m) and the performance of this division was in line with our expectations.

For the ongoing business as a whole, order intake for the period was £11.25m, down 11.6% from £12.7m on a like for like basis against the same period last year.

Outlook

The disappointing Spring gardening season so far means that meeting management's profit expectations for the year will be a considerable challenge. We are putting in place additional revenue and profit generating activities to enable us to meet that challenge whilst we continue to focus on controlling costs and increasing margins across all the Group's divisions. Details of these activities remain commercially sensitive at this time but we expect to be able to give more details in the announcement of our interim results, if not before.

For further information, please contact:

Flying Brands Limited 01245 228 300

Stephen Cook, Chief Executive

Anthony Gee, Finance Director

Smithfield Consultants 020 7360 4900 John Kiely

Notes to editors

Jersey based Flying Brands Limited (LSE: FBDU) is a multi brand and multi channel home shopping specialist. Founded in 1981, it was admitted to the Official List of the London Stock Exchange in 1993. The Group operates the following divisions: 

·; Gifts (Flying Flowers, a leading home shopping florist and gift delivery service)

·; Garden (Gardening Direct, one of the UK's largest mail order bedding plants and gardening products operations; Garden Bird Supplies, a leading provider of food and accessories for birds and other wildlife)

·; Entertainment (Listen2, a leading mail order audio books, nostalgic music, DVD and video home shopping retailer; Benham, the first day cover, stamps, coins and collectables specialist)

More information can be found at: www.flyingbrands.com