Sign In
3 Jul 2008 18:23
3 July 2008
Flying Brands Limited ('Flying Brands' or the 'Group')
Trading Update
Flying Brands, the Jersey-based home shopping group, is today providing an update on its Greetings Direct business further to its announcement on 29 May 2008.
In January 2008 it was announced that the Greetings Direct business would be tested in the United States and substantially extended in Australia. The response rates to the test in June in the United States have been extremely disappointing and the Board has decided not to invest any more monies in the United States and to close down that operation. The US performance would have delivered economies of scale which will now not materialise. This, combined with the continuing deterioration of the bad debts and returns metrics in the UK and Australia, means that Greetings Direct will make losses in 2008 with little probability of profits in 2009. As a result of this the Board has decided, with immediate effect, to close down the USA business and to start a managed closure of the UK and Australia operations over the next 12 months.
The impact of this decision is to impair the full carrying value of the goodwill and intangible assets of Greetings Direct by £11.5m.
In addition the Board considers it prudent to make a provision for future losses and closure costs for the Greetings Direct business of about £1.7m. This is likely to have a negative impact of circa £1.5m on the expected profit before tax for this financial year.
Trading in the other brands overall is currently in line with our expectations as expressed in our trading update of 29 May 2008.
For further information, please contact:
Flying Brands Limited 0844 884 6498
Tricia Killen, Chief Executive
Graham Norton, Finance Director
Smithfield Consultants 020 7360 4900
John Kiely
George Hudson
Notes to editors
Jersey based Flying Brands Limited (LSE: FBDU) is a multi brand home shopping
group. 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, the UK's largest flowers by post brand, despatching nearly one million bouquets a year; Greetings Direct, the UK's only continuity greeting cards business)
* 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; SarahRaven's Kitchen and Garden for hard to find plants and household accessories)
* Entertainment (Listen2Books, the leading mail order audio books, DVD and video publisher and distributor; Benham, the first day cover stamps and coins collectables specialist; Silverminds Direct, the nostalgic music business)
More information can be found at: www.flyingbrands.com
Follow the stocks
