JD Sports Regulatory News (JD.)

26 Sep 2007 07:01

John David Group (The) PLC26 September 2007 26 September 2007 THE JOHN DAVID GROUP PLC INTERIM RESULTS FOR THE TWENTY SIX WEEKS TO 28 JULY 2007 The John David Group Plc (the "Group"), the leading retailer of sport andathletic inspired fashion apparel and footwear, today announces its InterimResults for the 26 weeks ended 28 July 2007 (comparative figures are shown forthe 26 week period ended 29 July 2006): HIGHLIGHTS H1 2007 H1 2006 % Change £000 £000 Revenue 250,495 235,932 +6.2% Gross profit % 48.0% 47.4% +0.6% Operating profit (before net financing costsand exceptional items) 8,459 4,378 +93.2% Profit before tax and exceptional items 8,074 3,130 +158.0% Exceptional items (2,746) 99 Operating profit 5,713 4,477 +27.6% Profit before tax 5,328 3,229 +65.0% Basic earnings per ordinary share 7.29p 4.45p +63.8% Adjusted basic earnings per ordinary share(see note 6) 8.63p 6.21p +39.0% Interim dividend payable per ordinary share 2.50p 2.40p +4.2% Net cash/(debt) at end of period (see note 7) 7,122 (24,866) • Total Group revenue increased by 6.2% in the period and by 9.4% on a like for like basis. • Gross margin improved from 47.4% to 48.0%, reflecting the continuing benefits of better stock management and efforts to improve bought in margin as well as increasing own brand share. • Group profit before tax and exceptional items increased to £8.1 million (2006: £3.1 million). • Total Group like for like sales cumulatively to 22 September 2007 now up 11.8% (12.3% Sports Fascias; 3.3% Fashion Fascias). Peter Cowgill, Executive Chairman, said: "Trading since the period end has been highly satisfactory with year to datelike for like sales to 22 September 2007 in the Sports Fascias now up by 12.3%cumulatively. The Fashion Fascias like for like sales for the same period arenow up by 3.3%. Overall the Board expects the results to continue to besatisfactory with trading for the year to date running moderately ahead ofcurrent market expectations. As always, the final result remains heavilydependent upon sales performance during the key Christmas trading period." Enquiries: The John David Group Plc Tel: 0870 873 0333Peter Cowgill, Executive ChairmanBarry Bown, Chief ExecutiveBrian Small, Finance Director Hogarth Partnership Limited Tel: 020 7357 9477Andrew JaquesBarnaby FrySarah Richardson EXECUTIVE CHAIRMAN'S STATEMENT INTRODUCTION The 26 week period to 28 July 2007 has been one of sustained like for like salesimprovement in our core Sports Fascias which has continued in the ensuing periodto date in spite of our expectation of tightening in the economy. This hasdriven a substantial enhancement in Group performance and continued verypositive cashflow trends. This has enabled us to embark on an accelerated storerefurbishment programme as well as continuing to tackle the disposal of theremaining underperforming stores. The results of the Fashion Fascias arestronger, aided by improvements in the store portfolio, although it may takeuntil 2009 for profitability to be achieved. Our continued progress has resulted in an improved profit before tax andexceptional items of £8.1 million (2006: £3.1 million). Profit before tax in the period was £5.3 million (2006: £3.2 million) after anet exceptional charge of £2.8 million (2006: exceptional credit £0.1 million).The charge relates to property portfolio rationalisation costs, which remains amajor priority for the balance of this year. Further such action will result inan exceptional charge in the second half of the current year. However, theprogramme is now nearing completion. Profit for the period after taxation was £3.5 million (2006: £2.1 million). SPORTS FASCIAS The Sports Fascias have continued to trade very positively. This performance isthe result of continuous fine tuning of our major brand and own brand productoffer to maintain levels of exclusivity and fashionability combined with ourstrategy of improving our store portfolio. We are now seeing the benefits ofrationalising the acquired store portfolios and have also embarked on anaccelerated programme of store refurbishments after trialling a number of newstorefit types. Last year most store refurbishment activity was concentrated onthe Allsports stores, which we acquired in October 2005, although this year weanticipate refurbishing 28 stores from the rest of the portfolio. This programmewill continue next year. We also expect to open at least 10 new stores in thecurrent year. Consequently, gross capital investment will exceed thedepreciation charge in the current year. Another major initiative during the current year is the development of a moresophisticated approach to merchandising involving new systems, the first part ofwhich will go live in the second half of this year. This has necessitated aconsiderable investment in people and training. It is expected that this willallow us to sustain the improvement in the freshness of retail stock achieved inthe recent past and to ensure that localised stock service is much enhanced,therefore also reducing the need for very high levels of internal stockmovements. FASHION FASCIAS We have consistently stated that the Fashion Fascias would only provide profitto the business if some of the larger rented and over rented stores could bedisposed. Good progress has been made in this portfolio rationalisation with thedisposal of five further underperforming stores including Glasgow Open inSeptember. Nevertheless it could still take until 2009 to completely eliminateunderperforming stores and losses in these Fascias. Of the original JD Fashionstores, only two have not now been converted to Scotts. Stocks and overheads have been well controlled and operating margins have beenimproved, principally as a result of the continuing move to a more efficientlystructured property portfolio. Whilst progress has been made in the Fashion Fascias, which represented lessthan 6% of turnover in the first half, these stores will still make asubstantial though reduced loss in the current year. Nevertheless, the outlookfor these Fascias is improving slowly. GROUP PERFORMANCE Revenue, gross margin and overheads Total Group revenue increased by 6.2% in the period to £250.5 million (2006:£235.9 million) and by 9.4% on a like for like basis. Revenue increased by 9.9% on a like for like basis in the Sports Fascias. TheFashion Fascias like for like sales performance was up 2.1% cumulatively in thehalf year period. Group gross margin increased in the period from 47.4% to 48.0% reflecting thebenefits of better stock management, continuing efforts to improve bought inmargin and increased own brand sales in the Sports Fascias. Overheads (excluding exceptional items) net of other operating income, whichinclude some Allsports integration costs, improved to 44.7% of sales (2006:45.5%), as a result of increased turnover and improving property cost ratios.There have been planned increases in marketing and merchandising overheads inexcess of sales growth to achieve the improvement in results. Operating profits and results Group operating profit (before net financing costs and exceptional items)increased to £8.5 million (2006: £4.4 million). The Group operating profitmargin (before net financing costs and exceptional items) for the first half ofthe year has therefore increased from 1.9% to 3.4%. As a result of an exceptional charge of £2.8 million (2006: credit of £0.1million), operating profit after exceptional items but before net financingcosts was £5.7 million (2006: £4.5 million). The exceptional items comprise: £m Impairment of store fixed assets 0.9Lease variation costs 1.0Net release of onerous lease provisions (1.0)Loss on disposal of non-current assets 1.9 -------- Total 2.8 -------- The net release of onerous lease costs comprises a £2.7 million release relatedalmost entirely to one trading store after a lease variation gave us the optionto dispose of it, offset by a net charge to the provision for vacant stores.This charge is principally as a result of the relocation of three stores inMiddlesborough, Wigan and Warrington and a failed ex First Sport storeassignment in Maidstone. Profit before tax in the period was £5.3 million (2006: £3.2 million). Debt reduction and working capital Net debt was eliminated at 28 July 2007 and replaced by net cash of £7.1 million(2006: net debt £24.9 million). The Group continues to draw on its workingcapital facilities at the seasonal peaks for its working capital requirements. Inventories have reduced to £56.2 million at 28 July 2007 from £62.2 million at29 July 2006. Trade creditors continue to be paid to terms to maximisesettlement discounts. STORE PORTFOLIO Group store numbers reduced in the period from 406 to 392 and the total retailsquare footage decreased from 1,215,000 sq ft to 1,199,000 sq ft. The splitbetween the Sport and Fashion Fascias is as follows: Sport No. of Retail stores ('000 sq ft) At 28 January 2007 362 1,098New stores 4 16Disposals (14) (26) --------- --------- At 28 July 2007 352 1,088 --------- --------- Fashion No. of Retail stores ('000 sq ft) At 28 January 2007 44 117Disposals (4) (6) --------- --------- At 28 July 2007 40 111 --------- --------- DIVIDENDS AND EARNINGS PER ORDINARY SHARE The Board has, in the light of the improved first half trading performance,decided to propose an increased interim dividend of 2.50p per ordinary share(2006: 2.40p). The dividend will be paid on 11 January 2008 to shareholders onthe register as at close of business on 7 December 2007. The Board wishes toretain funding flexibility in the business to allow it to make strategicacquisitions if such opportunities arise and to continue the store investmentprogramme. The adjusted basic earnings per ordinary share before exceptional items are8.63p (2006: 6.21p). The basic earnings per ordinary share are 7.29p (2006: 4.45p). CURRENT TRADING AND OUTLOOK Trading since the period end has been highly satisfactory with year to date likefor like sales to 22 September 2007 in the Sports Fascias now up by 12.3%cumulatively. The Fashion Fascias like for like sales for the same period arenow up by 3.3%. Overall the Board expects the results to continue to besatisfactory with trading for the year to date running moderately ahead ofcurrent market expectations. As always, the final result remains heavilydependent upon sales performance during the key Christmas trading period. EMPLOYEES This year has so far seen considerable progress in performance again and webelieve that this is down to the contribution of all our employees, assisted byincreasing investment in training and communications. Nevertheless, thisprogress would not have happened without the considerable commitment of all ourstaff and management. The Board extends its thanks to all involved. Peter CowgillExecutive Chairman26 September 2007 CONSOLIDATED INCOME STATEMENTFOR THE 26 WEEKS ENDED 28 JULY 2007 Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 Note £000 £000 £000 REVENUE 2 250,495 235,932 530,581Cost of sales (130,179) (124,057) (278,331)------------------------ ----- --------- ---------- ---------- GROSS PROFIT 120,316 111,875 252,250Selling and distribution expenses (103,551) (101,035) (209,270)- normalSelling and distribution expenses 3 (2,746) 99 (3,799)- exceptional --------- ---------- ----------Selling and distribution expenses (106,297) (100,936) (213,069) --------- ---------- ----------Administrative expenses - normal (8,784) (7,362) (17,409)Administrative expenses - 3 - - (4,000)exceptional --------- ---------- ----------Administrative expenses (8,784) (7,362) (21,409) --------- ---------- ----------Other operating income 478 900 1,730------------------------ ----- --------- ---------- ---------- OPERATING PROFIT 5,713 4,477 19,502------------------------ ----- --------- ---------- ----------Before exceptional items 8,459 4,378 27,301Exceptional items 3 (2,746) 99 (7,799)------------------------ ----- --------- ---------- ---------- OPERATING PROFIT 5,713 4,477 19,502Financial income 118 70 177Financial expenses (503) (1,318) (2,412)------------------------ ----- --------- ---------- ---------- PROFIT BEFORE TAX 5,328 3,229 17,267Income tax expense 4 (1,812) (1,083) (6,879)------------------------ ----- --------- ---------- ---------- PROFIT FOR THE PERIOD 3,516 2,146 10,388ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT------------------------ ----- --------- ---------- ---------- Basic and diluted earnings per 6 7.29p 4.45p 21.52pordinary share ------------------------ ----- --------- ---------- ---------- GROUP STATEMENT OF RECOGNISED INCOME AND EXPENSEFOR THE 26 WEEKS ENDED 28 JULY 2007 The Group has no material recognised gains or losses during the current orprevious period other than the results reported above. CONSOLIDATED BALANCE SHEETAS AT 28 JULY 2007 Note Unaudited Unaudited As at As at As at 27 28 July 29 July January 2007 2006 2007 £000 £000 £000 ASSETSIntangible assets 20,562 25,316 20,562Property, plant and equipment 43,294 47,548 41,919Other receivables 2,710 2,747 2,753--------------------- ------ --------- --------- ---------TOTAL NON-CURRENT ASSETS 66,566 75,611 65,234--------------------- ------ --------- --------- --------- Inventories 56,169 62,180 51,469Income tax receivable - 899 -Trade and other receivables 13,986 12,672 13,012Cash and cash equivalents 7 7,374 4,450 11,230--------------------- ------ --------- --------- ---------TOTAL CURRENT ASSETS 77,529 80,201 75,711--------------------- ------ --------- --------- --------- TOTAL ASSETS 144,095 155,812 140,945--------------------- ------ --------- --------- --------- LIABILITIESInterest-bearing loans and borrowings (85) (29,029) (106)Trade and other payables (63,871) (54,254) (58,849)Provisions (1,590) (2,439) (2,130)Income tax liabilities (1,884) - (3,477)--------------------- ------ --------- --------- ---------TOTAL CURRENT LIABILITIES (67,430) (85,722) (64,562)--------------------- ------ --------- --------- --------- Interest-bearing loans and borrowings (167) (287) (192)Other payables (8,454) (8,207) (8,189)Provisions (3,487) (5,427) (4,829)Deferred tax liabilities (1,756) (1,651) (1,571)--------------------- ------ --------- --------- ---------TOTAL NON-CURRENT LIABILITIES (13,864) (15,572) (14,781)--------------------- ------ --------- --------- --------- TOTAL LIABILITIES (81,294) (101,294) (79,343)--------------------- ------ --------- --------- ---------TOTAL ASSETS LESS TOTAL 62,801 54,518 61,602LIABILITIES --------------------- ------ --------- --------- --------- CAPITAL AND RESERVESIssued ordinary share capital 8 2,413 2,413 2,413Share premium 8 10,823 10,823 10,823Retained earnings 8 49,565 41,282 48,366--------------------- ------ --------- --------- ---------TOTAL EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT 62,801 54,518 61,602--------------------- ------ --------- --------- --------- CONSOLIDATED CASH FLOW STATEMENTFOR THE 26 WEEKS ENDED 28 JULY 2007 Note Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000CASH FLOWS FROM OPERATING ACTIVITIESProfit for the period 3,516 2,146 10,388Income tax expense 4 1,812 1,083 6,879Financial expenses 503 1,318 2,412Financial income (118) (70) (177)Depreciation and 5,348 5,395 11,888amortisation ofnon-current assetsImpairment of non-current 908 - 5,482assetsLoss/(profit) on disposal 3 1,892 (1,315) (1,491)of non-current assets(Increase)/decrease in (4,700) (5,412) 5,299inventoriesIncrease in trade and (974) (633) (475)other receivablesIncrease/(decrease) in 1,141 (4,363) 1,488trade and otherpayables and provisionsInterest paid (503) (1,318) (2,412)Income taxes paid (3,220) (258) (1,712)------------------------ --- ---- ---------- --- ---------- --- ---------NET CASH FROM/(USED IN) 5,605 (3,427) 37,569OPERATING ACTIVITIES------------------------ --- ---- ---------- --- ---------- --- --------- CASH FLOWS FROM INVESTINGACTIVITIESInterest received 118 70 177Proceeds from sale of 1,231 3,972 11,099non-current assetsDisposal costs of (1,695) (340) (2,188)non-current assetsAcquisition of (9,069) (6,896) (14,099)non-current assetsCash consideration of - (4,998) (5,000)acquisitions ------------------------ --- ---- ---------- --- ---------- --- ---------NET CASH USED IN (9,415) (8,192) (10,011)INVESTING ACTIVITIES ------------------------ --- ---- ---------- --- ---------- --- --------- CASH FLOWS FROM FINANCINGACTIVITIES(Repayment)/drawdown of (37) 7,000 (22,000)interest-bearing loansand borrowingsPayment of finance lease (9) (267) (285)and similar hirepurchase contractsDividends paid - - (3,379)------------------------ --- ---- ---------- --- ---------- --- --------- NET CASH (USED IN)/FROM (46) 6,733 (25,664)FINANCING ACTIVITIE ------------------------ --- ---- ---------- --- ---------- --- --------- NET (DECREASE)/INCREASE 7 (3,856) (4,886) 1,894IN CASH AND CASH EQUIVALENTS------------------------ --- ---- ---------- --- ---------- --- --------- 1. BASIS OF PREPARATION The John David Group plc (the 'Company') is a company incorporated and domiciledin the United Kingdom. The consolidated half-year financial report for theperiod ended 28 July 2007 represents that of the Company and its subsidiaries(together referred to as the 'Group'). The half-year financial report was authorised for issue by the Board ofDirectors on 26 September 2007. As required by the Disclosure and Transparency Rules of the UK's FinancialServices Authority, the half-year financial report has been prepared byapplying the accounting policies and presentation that were applied in thepreparation of the Company's published consolidated financial statements forthe financial year ended 27 January 2007, which were prepared in accordancewith International Financial Reporting Standards as adopted by the EU. In the current financial year, the Group will adopt IFRS 7 'FinancialInstruments: Disclosures'. As this is a disclosure standard, there is no impacton the half-year financial report. The half-year financial report is prepared in accordance with the EU endorsedstandard IAS 34 'Interim Financial Reporting'. The comparative figures for thefinancial year ended 27 January 2007 are not the Group's statutory accounts forthat financial year. Those accounts have been reported on by the Group's Auditorand delivered to the Registrar of Companies. The Report of the Auditor was (i)unqualified, (ii) did not include a reference to any matters to which the Auditor drew attention by way of emphasis without qualifying their report, and(iii) did not contain a statement under section 237(2) or (3) of the CompaniesAct 1985. The information contained in the half-year financial report for the 26-weekperiod ended 28 July 2007 and 29 July 2006 is unaudited. 2. SEGMENTAL ANALYSIS The Group manages its business activities through two divisions - Sport andFashion. Revenue and costs are readily identifiable for each segment. The divisional results for the 26 weeks to 28 July 2007 are as follows: Unaudited Unaudited Unaudited Sport Fashion Total £000 £000 £000 Revenue 236,172 14,323 250,495-------------------------- ---------- ---------- ---------Operating profit/(loss) before financing 10,638 (2,179) 8,459and exceptional itemsExceptional items (3,512) 766 (2,746)-------------------------- ---------- ---------- ---------Operating profit/(loss) 7,126 (1,413) 5,713Financial income 118Financial expenses (503)-------------------------- ---------- ---------- ---------Profit before tax 5,328Income tax expense (1,812)-------------------------- ---------- ---------- ---------Profit for the period 3,516-------------------------- ---------- ---------- --------- The Board consider that net funding costs and income tax are cross divisional innature and cannot be allocated between the divisions on a meaningful basis. The comparative divisional results for the 26 weeks to 29 July 2006 are as follows: Unaudited Unaudited Unaudited Sport Fashion Total £000 £000 £000 Revenue 219,556 16,376 235,932-------------------------- ---------- ---------- ---------Operating profit/(loss) before financing 7,390 (3,012) 4,378and exceptional itemsExceptional items (1,728) 1,827 99-------------------------- ---------- ---------- ---------Operating profit/(loss) 5,662 (1,185) 4,477Financial income 70Financial expenses (1,318)-------------------------- ---------- ---------- ---------Profit before tax 3,229Income tax expense (1,083)-------------------------- ---------- ---------- ---------Profit for the period 2,146-------------------------- ---------- ---------- --------- The Board consider that net funding costs and income tax are cross divisional innature and cannot be allocated between the divisions on a meaningful basis. 3. EXCEPTIONAL ITEMS Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000 Loss/(profit) on disposal of non-current 1,892 (1,315) (1,491)assetsProvision for rentals on onerous property (1,092) 1,216 1,558leasesImpairment of property, plant and equipment 832 - 1,482Impairment of non-current other receivables 76 - -Lease variation costs (i) 1,038 - 2,250-------------------------- ---------- ---------- ---------Selling and distribution expenses - 2,746 (99) 3,799exceptional -------------------------- ---------- ---------- --------- Impairments of intangible assets - - 4,000-------------------------- ---------- ---------- ---------Administrative expenses - exceptional - - 4,000-------------------------- ---------- ---------- ---------Exceptional expense/(credit) 2,746 (99) 7,799-------------------------- ---------- ---------- --------- (i) Lease variation costs represent the cost of varying an onerous lease tocreate a break option. 4. INCOME TAX EXPENSE Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000Current taxUK corporation tax at 30% (2006: 30%) 1,627 1,096 6,637Adjustment relating to prior periods - - 288-------------------------- ---------- ---------- ---------Total current tax charge 1,627 1,096 6,925-------------------------- ---------- ---------- ---------Deferred taxDeferred tax (origination and reversal of 185 (13) 641temporary differences)Adjustments relating to prior periods - - (687)-------------------------- ---------- ---------- ---------Total deferred tax charge/(credit) 185 (13) (46)-------------------------- ---------- ---------- ---------Income tax expense 1,812 1,083 6,879-------------------------- ---------- ---------- --------- 5. DIVIDENDS After the balance sheet date the following dividends were proposed by theDirectors. The dividends were not provided for at the balance sheet date. Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000 2.50p per ordinary share (29 July 2006: 1,207 1,158 2,3172.40p, 27 January 2007: 4.80p)-------------------------- ---------- ---------- --------- DIVIDENDS ON ISSUED ORDINARY SHARE CAPITAL Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000 Final dividend of 4.80p (2006: 4.60p) perqualifying ordinary share approved in respect of prior period, but not recognised as a liability in that period 2,317 2,221 2,221 Interim dividend of 2.40p per qualifyingordinary share paid in respect of 52 week period ended27 January 2007 - - 1,158-------------------------- ---------- ---------- --------- 2,317 2,221 3,379-------------------------- ---------- ---------- --------- 6. EARNINGS PER ORDINARY SHARE BASIC AND DILUTED EARNINGS PER ORDINARY SHARE The calculation of basic and diluted earnings per ordinary share at 28 July 2007is based on the profit for the period attributable to equity holders of theparent of £3,516,000 (29 July 2006: £2,146,000, 27 January 2007: £10,388,000)and a weighted average number of ordinary shares outstanding during the 26 weeksended 28 July 2007 of 48,263,434 (29 July 2006 and 27 January 2007: 48,263,434),calculated as follows: Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000 Issued ordinary shares at beginning of 48,263,434 48,263,434 48,263,434periodEffect of shares issued during the period - - --------------------------- ---------- ---------- ---------Weighted average number of ordinary sharesduring the period - basic and diluted 48,263,434 48,263,434 48,263,434-------------------------- ---------- ---------- --------- ADJUSTED BASIC EARNINGS PER ORDINARY SHARE Adjusted basic earnings per ordinary share has been based on the profit for theperiod attributable to equity holders of the parent for each financial periodbut excluding the post tax effect of certain exceptional items. The Directorsconsider that this gives a more meaningful measure of the underlying performanceof the Group. Unaudited Unaudited 26 weeks to 26 weeks to 52 weeks to 28 July 29 July 27 January 2007 2006 2007 £000 £000 £000 Profit for the period attributable to equityholders of the parent 3,516 2,146 10,388Exceptional items excluding profit on disposal of non-current assets 854 1,216 9,290Tax relating to relevant exceptional items (207) (365) (2,107)-------------------------- ---------- --------- ---------Profit for the period attributable to equityholders of the parent excludingexceptional items 4,163 2,997 17,571-------------------------- ---------- --------- --------- Adjusted basic earnings per ordinary share 8.63p 6.21p 36.41p-------------------------- ---------- --------- --------- 7. ANALYSIS OF NET DEBT Unaudited At 27 January Unaudited At 28 July 2007 Cashflow 2007 £000 £000 £000 Bank balances and cash floats 11,230 (3,856) 7,374-------------------------- ---------- --------- ---------Cash and cash equivalents 11,230 (3,856) 7,374 Interest-bearing loans and borrowings:Loan notes (287) 37 (250)Finance leases and similar hirepurchase contracts (11) 9 (2)-------------------------- ---------- --------- --------- 10,932 (3,810) 7,122-------------------------- ---------- --------- --------- 8. CAPITAL AND RESERVES RECONCILIATION OF MOVEMENT IN CAPITAL AND RESERVES UNAUDITED Ordinary Share Share Retained Total Capital Premium Earnings Equity £000 £000 £000 £000 Balance at 27 January 2007 2,413 10,823 48,366 61,602Total recognised income and expense - - 3,516 3,516Dividends to shareholders (see note 5) - - (2,317) (2,317)--------------------- -------- --------- --------- --------- Balance at 28 July 2007 2,413 10,823 49,565 62,801--------------------- -------- --------- --------- --------- UNAUDITED Ordinary Share Share Retained Total Capital Premium Earnings Equity £000 £000 £000 £000 Balance at 28 January 2006 2,413 10,823 41,357 54,593Total recognised income and expense - - 2,146 2,146Dividends to shareholders (see note 5) - - (2,221) (2,221)--------------------- -------- --------- --------- --------- Balance at 29 July 2006 2,413 10,823 41,282 54,518--------------------- -------- --------- --------- --------- 9. RELATED PARTY TRANSACTIONS AND BALANCES RELATED PARTY - PENTLAND GROUP PLC Pentland Group Plc owns 57% of the issued ordinary share capital of The JohnDavid Group Plc. Unaudited Unaudited Value of Value of transactions Unaudited transactions Unaudited 26 weeks to Payable at 26 weeks to Payable at 28 July 2007 28 July 2007 29 July 2006 29 July 2006 £000 £000 £000 £000 Concession fee income (147) - (271) -Purchase of inventory for retail (13,005) (2,857) (13,447) (3,015)Other income 44 - 22 - Payments (gross including VAT) (14,400) - (14,598) -Receipts (gross including VAT) 52 - 26 - 10. HALF-YEAR REPORT The half-year report will be posted to all shareholders in mid October.Additional copies are available on application to the Company Secretary, TheJohn David Group Plc, Hollinsbrook Way, Pilsworth, Bury, Lancashire, BL9 8RR, orcan be downloaded from our website: www.thejohndavidgroup.com. RESPONSIBILITY STATEMENT We confirm that to the best of our knowledge: • The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the EU; • The interim management report includes a fair review of the information required by: a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of principal risks and uncertainties for the remaining six months of the year; and b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so. By order of the Board Brian SmallSecretary INDEPENDENT REVIEW REPORT TO THE JOHN DAVID GROUP PLC INTRODUCTION We have been engaged by the Company to review the condensed set of financialstatements in the half-year financial report for the 26 week period ended 28July 2007 which comprises the Consolidated Income Statement, ConsolidatedBalance Sheet, Consolidated Cash Flow Statement and the related explanatorynotes. We have read the other information contained in the half-year financialreport and considered whether it contains any apparent misstatements or materialinconsistencies with the information in the condensed set of financialstatements. This report is made solely to the Company in accordance with the terms of ourengagement to assist the Company in meeting the requirements of the Disclosureand Transparency Rules ('the DTR') of the UK's Financial Services Authority('the UK FSA'). Our review has been undertaken so that we might state to theCompany those matters we are required to state to it in this report and for noother purpose. To the fullest extent permitted by law, we do not accept orassume responsibility to anyone other than the Company for our review work, forthis report, or for the conclusions we have reached. DIRECTORS' RESPONSIBILITIES The half-year financial report is the responsibility of, and has been approvedby, the Directors. The Directors are responsible for preparing the half-yearfinancial report in accordance with the DTR of the UK FSA. As disclosed in note 1, the annual financial statements of the Group areprepared in accordance with IFRSs as adopted by the EU. The condensed set offinancial statements included in this half-year financial report has beenprepared in accordance with IAS 34 'Interim Financial Reporting' as adopted bythe EU. OUR RESPONSIBILITY Our responsibility is to express to the Company a conclusion on the condensedset of financial statements in the half-year financial report based on ourreview. SCOPE OF REVIEW We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410 'Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity' issued by the AuditingPractices Board for use in the UK. A review of interim financial informationconsists of making enquiries, primarily of persons responsible for financial andaccounting matters, and applying analytical and other review procedures. Areview is substantially less in scope than an audit conducted in accordance withInternational Standards on Auditing (UK and Ireland) and consequently does notenable us to obtain assurance that we would become aware of all significantmatters that might be identified in an audit. Accordingly, we do not express anaudit opinion. CONCLUSION Based on our review, nothing has come to our attention that causes us to believethat the condensed set of financial statements in the half-year financial reportfor the 26-week period ended 28 July 2007 is not prepared, in all materialrespects, in accordance with IAS 34 as adopted by the EU and the DTR of the UKFSA. KPMG Audit PlcChartered AccountantsPreston26 September 2007 This information is provided by RNS The company news service from the London Stock Exchange