Longboat Energy Regulatory News (LBE)

21 Mar 2007 07:01

Liberty PLC21 March 2007 FOR IMMEDIATE RELEASE 21st March 2007 LIBERTY PLC PRELIMINARY ANNOUNCEMENT OF RESULTS FOR THE EIGHTEEN MONTHS ENDED 31ST DECEMBER 2006 HIGHLIGHTS LIBERTY PLC • Group sales ahead 3.5% for the year to December 2006 atapproximately £44m, despite 20% less trading area following move out of RegentStreet space. • Flagship store sales up 6.4% for the year to December 2006at £31.6m. • Strong performance from Menswear up 14% with positiveincreases in Ladieswear and Accessories on less space. • Liberty of London branded luxury goods sales continuing toadvance. • Progression of international launch of Liberty of Londonbrand - discussions regarding a Japanese distribution agreement are progressingwith a view to launching the range in Autumn 2008. • Earnings before tax, excluding property profits andexceptional income, shows strong improvement. This year shows a loss of £2.2mfor the year, against a loss of £4.4m for the year to December 2005. "We believe we are in the process of creating the team that will establishLiberty as a global luxury brand and a profitable business. The team is workingtogether to produce the right designs and products in an environment that isattractive to our increasingly expanding and loyal customer base. With that inmind, the Board of Liberty views the future with cautious optimism." Richard Balfour-Lynn, Chairman Liberty Plc 21st March 2007 LIBERTY PLC CHAIRMAN'S STATEMENT Liberty, the iconic London emporium, continued its upward progress that Ireported in September 2006 with strong sales growth in the second half of thecalendar year as the business shrugged off the depression seen in other parts ofthe retail sector. It is worth re-stating that this continued improvement hasbeen achieved against a background of 20% less sales space at Liberty, followingthe closure of the Regent Street frontage in March 2006, and a generally toughretailing climate. Before I comment on business performance in more detail I thought I wouldmention the fact that during 2006 the Group changed its year end from 30th Juneto 31st December. For ease of understanding the Group's underlying performance Ihave referred to the proforma unaudited accounts for the 12 months ended 31stDecember 2005 and 31st December 2006 in this statement. Virtually all aspects of the business performed well, with overall flagshipstore sales at £47.9m for the 18 month period to 31st December 2006. Over the 12months to 31st December 2006 sales were £31.6m, up 6.4% from £29.7m in theprevious year to December 31st 2005. The Liberty group comprises three operating businesses - Retail, Fabric andLiberty of London (our luxury branded goods division). Across the group, EBITDAbefore exceptionals and brand investment for the 18 months ended 31st December2006 was £1.5m. For the year to 31st December 2006 EBITDA before exceptionalsand brand expenditure was £1.4m compared to a negative £0.6m for the year toDecember 2005; an improvement of some £2.0m. Sales across the business totalled£66.4m for the 18 months ended 31st December 2006. Comparative sales for theyear to 31st December 2006 were £44.0m,up from £42.5m in the previous 12 monthperiod. Alongside this solid improvement in trading results has been a strong rentalgrowth combined with further yield compression in the West End of London whereLiberty is based. This has resulted in the valuation of our freehold property inGreat Marlborough Street (the Tudor Building) increasing from £26m at 30th June2005 to £35m at 31st December 2006. This extra value underpins the furthergrowth being achieved across the business. Pre-tax losses for the 18 month period ended 31st December 2006 beforeexceptional items and brand expenditure, showed a loss of £0.9m. Pre-tax resultsbefore exceptional items and brand expenditure for the year ended 31st December2006 were greatly improved at a near break-even position, against a loss of£3.2m for the 2005 calendar year. Within the flagship store, ladieswear and accessories continued to improve whilemenswear produced a dramatic 14% sales increase over the 12 month period, as theimpact of our new merchandising and buying regimes was felt. I am also delighted to report that our luxury brand, Liberty of London,continues to make a tremendous impact among our customers. Sales of Liberty ofLondon product, through the retail business relocated to our central atrium,grew by nearly 40% to £1.3m for the year to December 2006, as our leather goodsranges continued to find favour with a highly discerning retail public. One ofthis year's "must have" handbags was our Carriage Bag with a £695 price tag, andthis flew out of the store in impressive style. There is little doubt that our move into the luxury branded goods market hasbeen a great success and under the guidance and design flair of CreativeDirector Tamara Salman, the Liberty of London label is going from strength tostrength. This area of our business was reinforced in August 2006 with theappointment of James Crespo, recruited from Burberry Prorsum, as CommercialDirector, who is looking to expand the label outside our flagship store. Reflecting the importance of Liberty of London to our business, we re-opened thenew look central atrium in the flagship store in February 2007 devoted entirelyto our luxury label. Significantly this re-fit of the central atrium has beendesigned, and branded, in a way which enables it to be easily replicatedelsewhere. This could take the form of either a "store within a store" concept,or a stand-alone store devoted entirely to the Liberty of London range, eitherelsewhere in London or abroad. Discussions are ongoing regarding a distributionagreement in Japan, with these likely to be concluded by the second half of theyear. This will allow us to take full advantage of the Liberty brand awarenessamong local consumers. Our fabric business has been particularly successful with sales, including ourJapanese joint venture, at £12.0m for the year to end December 2006 against£12.1m for the previous 12 month period. This was an extremely creditableperformance as Sterling strengthened by 12% against the Yen during the yearunder review. This translated into EBITDA for our fabrics business of £2.0m forthe 12 months to 31st December 2006, against £1.8m for the comparative 2005period. Over the 18 months to December 2006, sales totalled £17.7m, whichgenerated EBITDA of £2.6m. The Japanese joint venture expires this year and we have been activelyorganising the next phase of our business there. In the future our global fabricbusiness will be run from London and as part of this re-organisation, I amdelighted to report that we have recruited Kirstie Carey to head up thedivision's sales and marketing activities. She is looking to open new marketsfor our fabrics business, particularly for our high quality shirting fabrics, aswell as looking to diversify into new base cloths and special designs. Throughout the business we have been looking to strengthen our management andover the past year there have been a number of key appointments aimed atcreating an integrated team that will mastermind and oversee Liberty's continuedbusiness programme. It is particularly pleasing that we have also been able topromote a number of established executives from within the business to keymanagement positions during the past year. This includes Mandy Brooks who joined Liberty two and half years ago from LKBennett where she was Retail Director and before that joint managing director ofWhistles. Mandy is being appointed to the Liberty Retail board where she andJane Davies (previously at Selfridges) who has been our Buying and MerchandisingDirector for over three years, will focus on the continuing revival of theflagship store. At the same time Julia Reardon, who also joined us fromSelfridges, has been appointed Head of Retail Operations, and will concentrateon further development of our customer initiatives. Elsewhere I am pleased to report the appointment of Louise Gorringe as Head ofLiberty Retail Marketing with overall responsibility for marketing and publicrelations initiatives for the flagship store, with particular emphasis oncustomer events and the increasingly successful Liberty Loyalty Card. Louisejoined the group from our loyalty card partner, Ikano. Also Paul Harris, whojoined the group in July 2006 from Selfridges and Kurt Geiger, has beenappointed Group Financial Controller to continue the improvement in ourfinancial management and performance reporting. I would also like to thank Joe Shashou for his support over the last few yearsas he steps down from his role as non-executive director. He is replaced byJagtar Singh who will work closely with the executive team at Liberty. Overall we are delighted with the progress being made at Liberty andparticularly as one of our key objectives during 2006 was to establish a pointof difference within our customers' minds and to make the flagship store a trulyretail destination. The extent to which we have achieved that objective can beseen from our sales in the run-up to Christmas when many retailers struggled toattract their normal level of customers. In the four week trading period runningup to Christmas in 2006, sales rose by almost 6% and we recorded our highestever normal day's trading, where over two consecutive days, sales totalledalmost £1m. With our UK operations improving and with an enlarged and capable managementteam now in place, we have been concentrating on expanding the Liberty of Londonbrand. This involves taking the business forward through an internationalexpansion of the brand and by exploring new ways in which our products can beprofitably sold outside the UK. We look forward to reporting on this furtherexpansion in our June 2007 interim results. Liberty has been through a period of major change and re-structuring as we aimto transform the business into a vibrant and dynamic retailer capable ofcompeting globally as well as nationally. We have made tremendous progress inachieving our corporate objectives and, while there is still much work to do, wecould not have delivered that progress without the support, commitment andenergy of Liberty's staff and management. We believe we are in the process of creating the team that will establishLiberty as a global luxury brand and a profitable business. The team is workingtogether to produce the right designs and products in an environment that isattractive to our increasingly expanding and loyal customer base. With that inmind, the Board of Liberty views the future with cautious optimism. Richard Balfour-LynnChairman 21st March 2007 LIBERTY PLC OPERATING REVIEW During the eighteen months ended 31st December 2006, Liberty Plc has continuedits transformation into a dynamic retail destination, underpinned by a strongand expanding retail brand. The historical trading and balance sheet performanceof Liberty Plc is summarised below:- Year ended Year ended Eighteen months 31st December 31st December ended 2006 2005 31st December proforma proforma 2006 unaudited unauditedFinancial performance £'000 £'000 £'000 Turnover 66,407 44,012 42,460Depreciation (2,234) (1,491) (1,453)Brand expenditure (2,843) (1,971) (1,182)Operating loss (1,897) (2,047) 875Profit on disposal ofproperties - - 2,432Operating EBITDA beforeprofit on sale of 1,461 1,415 (642)properties, exceptionals andbrand expenditureTotal recognised gains andlosses 2,705 8,668 2,465---------------------------- ----------- ---------- ----------- 31st December 2005 31st December proforma 30th June 2006 unaudited 2005Balance sheet composition £'000 £'000 £'000 Intangible asset - brand 18,200 18,200 18,200Tangible assets - Property,plant and equipment 36,587 28,609 27,909(Net debt)/Cash (1,191) 3,892 3,630Net assets after pensiondeficit 51,141 42,523 42,345Equity shareholders' fundsper share 215p 177p 173p---------------------------- ----------- ---------- ----------- CONSOLIDATED PROFIT AND LOSS ACCOUNT for the eighteen months ended 31st December 2006 Year ended Year Eighteen months 31st December ended ended 2006 30th June 31st December proforma 2005 2006 unaudited (Restated) Notes £'000 £'000 £'000------------------------ ------ ------------ ---------- ---------Turnover 2 66,407 44,012 43,760 Cost of sales (36,197) (24,000) (24,754)------------------------ ------ ------------ ---------- ---------Gross profit 30,210 20,012 19,006 Selling and distribution (30,932) (19,952) (21,154)costsAdministrative expenses (3,804) (2,680) (2,576)Exceptional operating income 3 1,720 - -Other operating income 909 573 2,710------------------------ ------ ------------ ---------- ---------Operating loss (1,897) (2,047) (2,014)Profit on disposal ofinvestment and operationalproperties - - 2,432------------------------ ------ ------------ ---------- ---------(Loss)/Profit on ordinaryactivities before interest (1,897) (2,047) 418Net interest(payable)/receivable andsimilar charges 7 (147) (2,925)Other finance costs (159) (12) (114)------------------------ ------ ------------ ---------- ---------Loss on ordinary activitiesbefore taxation (2,049) (2,206) (2,621)Taxation on loss on ordinaryactivities 4 (669) (437) (651)------------------------ ------ ------------ ---------- ---------Loss on ordinary activitiesafter taxation (2,718) (2,643) (3,272)Equity minority interests (411) (313) (245)Non-equity minority interests (82) (55) (55)------------------------ ------ ------------ ---------- ---------Loss attributable to ordinaryshareholders (3,211) (3,011) (3,572)Undeclared non-equitypreference dividends (35) (23) (23)------------------------ ------ ------------ ---------- ---------Retained loss for the period (3,246) (3,034) (3,595)------------------------ ------ ------------ ---------- --------- Basic loss per share 5 (14.2p) (13.3p) (15.8p)Diluted loss per share (14.2p) (13.3p) (14.8p)------------------------ ------ ------------ ---------- --------- All operations are continuing. CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES for the eighteen months ended 31st December 2006 Year ended Year Eighteen months 31st December ended ended 2006 30th June 31st December proforma 2005 2006 unaudited (Restated) £'000 £'000 £'000---------------------------- ------------ ---------- ---------Loss for the period (3,246) (3,034) (3,595)Revaluation surplus on fixedassets credited to revaluationreserve 8,072 7,183 5,513Actuarial gain/(loss) on pensionscheme 4,977 4,714 (1,205)Currency translation differenceson foreign currency netinvestments (235) (195) (11)---------------------------- ------------ ---------- ---------Total recognised gains and lossesfor the period 9,568 8,668 702Prior period adjustment - adoptionof FRS17 (6,863) - ----------------------------- ------------ ---------- ---------Total recognised gains and lossessince last Annual Report 2,705 8,668 702---------------------------- ------------ ---------- --------- All recognised gains and losses are attributable to equity shareholders'interests. NOTE OF CONSOLIDATED STATEMENT OF HISTORICAL COST PROFITS AND LOSSES for the eighteen months ended 31st December 2006 Year ended Year Eighteen months 31st December ended ended 2006 30th June 31st December proforma 2005 2006 unaudited (Restated) £'000 £'000 £'000---------------------------- ------------ ---------- ---------Reported loss on ordinaryactivities before taxation (2,049) (2,206) (2,621)---------------------------- ------------ ---------- --------- Realisation of propertyrevaluation surplus recorded inprevious years - - 13,266Difference between historical costof depreciation charge anddepreciation charge based onrevalued amounts. 543 362 56---------------------------- ------------ ---------- ---------Historical cost (loss)/profit onordinary activities beforetaxation (1,506) (1,844) 10,701---------------------------- ------------ ---------- --------- Historical cost (loss)/profitretained after taxation, minorityinterests and dividends (2,703) (2,672) 9,727---------------------------- ------------ ---------- --------- RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS for the eighteen months ended 31st December 2006 Year Eighteen ended Months ended 30th June 31st December 2005 2006 (Restated) £'000 £'000---------------------------- ---------------- -------------Opening shareholders' funds as originally 46,760 44,879statedPrior year adjustment - adoption of FRS17 (6,863) (5,707)---------------------------- ---------------- -------------Opening shareholders' funds as restated 39,897 39,172Loss for financial period (3,211) (3,572)Undeclared non-equity preference dividends (35) (23)Revaluation surplus on fixed assets credited torevaluation reserve 8,072 5,513Actuarial gain/(loss) on pension scheme 4,977 (1,205)Currency translation differences on foreigncurrency net investments (235) (11)Unpaid non-equity preference dividends 35 23---------------------------- ---------------- -------------Closing shareholders' funds 49,500 39,897---------------------------- ---------------- ------------- CONSOLIDATED BALANCE SHEET at 31st December 2006 31st December 2005 30th June 31st December proforma 2005 2006 unaudited (Restated)------------------------- ------ ----------- ----------- --------- Notes £'000 £'000 £'000Fixed assets Intangible asset 6 18,200 18,200 18,200Tangible assets 7 36,587 28,609 27,909------------------------- ------ ----------- ----------- --------- 54,787 46,809 46,109------------------------- ------ ----------- ----------- ---------Current assetsStocks 7,489 6,830 6,653Debtors (including £251k over 1 5,997 6,984 8,141year)Cash 1,020 3,892 3,630------------------------- ------ ----------- ----------- --------- 14,506 17,706 18,424Creditors: amounts falling duewithin one 8 (14,908) (13,656) (13,580)year ------ ----------- ----------- ----------------------------------Net current assets (402) 4,050 4,844------------------------- ------ ----------- ----------- ---------Total assets less current 54,385 50,859 50,953liabilitiesCreditors: amounts falling dueafter more (1,696) (1,746) (1,745)than one year ------ ----------- ----------- ----------------------------------Net assets before pension 52,689 49,113 49,208deficitPension deficit (1,548) (6,590) (6,863)------------------------- ------ ----------- ----------- ---------Net assets after pension 51,141 42,523 42,345deficit ------ ----------- ----------- ---------------------------------- Capital and reservesCalled up share capital 6,036 6,036 6,036Merger reserve 9 61,503 61,503 61,503Revaluation reserve 9 12,600 5,418 4,528Profit and loss account 9 (30,639) (32,151) (32,170)------------------------- ------ ----------- ----------- ---------Total shareholders' funds 49,500 40,806 39,897Analysed as:------------------------- ------ ----------- ----------- ---------Equity shareholders' funds 48,965 40,294 39,397Non-equity shareholders funds 535 512 500------------------------- ------ ----------- ----------- ---------Equity minority interests 1,063 1,139 1,870Non-equity minority interests 578 578 578------------------------- ------ ----------- ----------- --------- 51,141 42,523 42,345 ------------------------- ------ ----------- ----------- --------- Approved by the Board of Directors on 21st March 2007 and signed on its behalfby: Richard Balfour-Lynn Iain RenwickCHAIRMAN CHIEF EXECUTIVE CONSOLIDATED CASH FLOW STATEMENT for the eighteen months ended 31st December 2006 Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005 Notes £'000 £'000 £'000------------------------ ------ ------------ ----------- ---------Net cash (outflow)/inflowfrom 11 126 (1,890) (9,643)operating activitiesReturns on investments andservicing (1,173) (362) (3,792)of financeTax paid (582) (370) (635)Capital expenditure andfinancial (2,840) (2,287) 65,227investment------------------------ ------ ------------ ----------- --------- Net cash (outflow)/inflowbeforefinancing and use of liquid (4,469) (4,909) 51,157resourcesManagement of liquid - 2,940 500resourcesFinancing - - (52,000)------------------------ ------ ------------ ----------- --------- Decrease in cash during the (4,469) (1,969) (343)period ------------------------ ------ ------------ ----------- --------- RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT for the eighteen months ended 31st December 2006 Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005 Notes £'000 £'000 £'000------------------------ ------ ------------ ----------- ---------Decrease in cash during theperiod 12 (4,469) (1,971) (343)(Decrease) in liquid resources 12 - (2,940) (500)Decrease in loans during theperiod - - 52,000------------------------ ------ ------------ ----------- --------- Decrease/(increase) in netdebt (4,469) (4,911) 51,157during the periodTranslation differences 12 (352) (172) (17)------------------------ ------ ------------ ----------- ---------Movement in net debt duringthe period (4,821) (5,083) 51,140Opening net cash/(debt) 3,630 3,892 (47,510)------------------------ ------ ------------ ----------- ---------Closing net (debt)/cash 12 (1,191) (1,191) 3,630------------------------ ------ ------------ ----------- --------- 1. ACCOUNTING POLICIES Basis of preparation of accounts The accounts have been prepared under the historical cost convention, asmodified by the revaluation of investment and operational properties. They havealso been prepared in accordance with applicable accounting standards and withthe Companies Act 1985, except as noted below under Brands. References to the"Company" are to Liberty Plc and references to the "Group" are to the Companyand its subsidiaries, or any of them as the context may require. On 7th August 2006, the Company announced its decision to change its accountingreference date from 30th June to 31st December. Each of the Group's threeoperating divisions report results internally by reference to that period.Accordingly, the change of Accounting Reference Date accords with internalreporting procedures and operational components of the Group, thus aidingmanagement and shareholders in the dissemination of underlying financialinformation of the Group. These Accounts have therefore been prepared for theeighteen month period from the latest audited accounts that ended on 30th June2005, through to 31st December 2006. Comparative proforma unaudited informationhas also been included for the year ended 31st December 2006. The comparativeaudited information has been derived from the audited accounts of the Group forthe year ended 30th June 2005. For comparative purposes a proforma unauditedbalance sheet as at 31stDecember 2005 is also shown. These accounts incorporate the results of Liberty Plc and its subsidiaryundertakings. The results have been prepared on the basis of the accountingpolicies adopted in the accounts of the Group for the eighteen month periodended 31st December 2006, consistently applied in all material respects. 2. DIVISIONAL ANALYSIS Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005Turnover £'000 £'000 £'000------------------------- ------------- ----------- ----------By class of business:Retail 48,708 32,030 31,016Fabric 17,654 11,969 12,744Liberty of London branded product 45 13 -------------------------- ------------- ----------- ---------- 66,407 44,012 43,760------------------------- ------------- ----------- ---------- By geographical origin:United Kingdom 59,382 39,036 38,875Japan 7,025 4,976 4,885------------------------- ------------- ----------- ---------- 66,407 44,012 43,760------------------------- ------------- ----------- ---------- By geographical destination:United Kingdom 50,641 33,367 32,273Japan 7,025 4,976 4,885Other 8,741 5,669 6,602------------------------- ------------- ----------- ---------- 66,407 44,012 43,760------------------------- ------------- ----------- ---------- (Loss)/profit on ordinary activitiesbefore interest------------------------- ------------- ----------- ----------By class of business:Retail (3,012) (2,780) (1,175)Fabric 3,958 2,704 2,775Liberty of London branded product (2,843) (1,971) (1,182)------------------------- ------------- ----------- ---------- (1,897) (2,047) 418------------------------- ------------- ----------- ---------- By geographical origin:United Kingdom (3,312) (3,124) (502)Japan 1,415 1,077 920------------------------- ------------- ----------- ---------- (1,897) (2,047) 418------------------------- ------------- ----------- ---------- 2. DIVISIONAL ANALYSIS (continued) 31st December 2005 30th June 31st December proforma 2005 2006 unaudited (Restated) £'000 £'000 £'000Net assets-------------------------- ----------- ----------- ----------By class of business:Retail 42,494 35,335 34,607Fabric 8,647 7,188 7,738Liberty of London branded product - - --------------------------- ----------- ----------- ---------- 51,141 42,523 42,345-------------------------- ----------- ----------- ---------- By geographical origin:United Kingdom 48,973 40,197 38,567Japan 2,168 2,326 3,778-------------------------- ----------- ----------- ---------- 51,141 42,523 42,345-------------------------- ----------- ----------- ---------- The segmental analysis of operations reflects the structure of the Group. Retailincludes the UK retail operations at Regent Street and Heathrow but does notinclude Liberty of London branded product which is detailed separately. Fabricincludes the results of the UK and Japanese fabric businesses. Cash balances and bank loans are allocated to Retail as this division utilisesthe cash balances and buildings against which debt is secured. Concession turnover Sales from concession departments are shown on a commission only basis. Grossturnover of concession departments was as follows: Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000Gross turnover of concessiondepartments 11,758 7,589 7,622------------------------- ------------ ----------- ---------- 3. EXCEPTIONAL OPERATING INCOME Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000Profit arising on sale of minortrademark 1,720 - -------------------------- ------------ ----------- ---------- During the six months ended 31st December 2005, the Group received a payment of£1,720,000, which related to the sale of a minor trademark. This has beenreflected in the profit and loss account for the eighteen months ended 31stDecember 2006 as an exceptional item because of its size. The proceeds receivedwere used to reduce Group debt. 4. TAXATION ON LOSS ON ORDINARY ACTIVITIES Year ended Eighteen months 31st December Year ended 2006 ended 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000UK TaxUK Corporation tax on UK results - - (218) Overseas taxWithholding tax written off (134) (36) (57)Japanese tax on Japanese profits (477) (350) (345)Adjustments in respect of prioryears (58) (51) (31)------------------------ ------------- ------------ --------- (669) (437) (651)------------------------ ------------- ------------ --------- 5. LOSS PER SHARE The loss per share figures are calculated by dividing the loss after taxationand minority interests for the period by the weighted average number of sharesin issue during the period as follows:- Year ended Year Eighteen months 31st December ended ended 2006 30th June 31st December proforma 2005 2006 unaudited (Restated) £'000 £'000 £'000Loss on ordinary activities aftertaxation and minority interests (3,211) (3,011) (3,572)------------------------ ------------- ------------ --------- Number Number Number '000 '000 '000Weighted average number of ordinaryshares in issue during the period 22,603 22,603 22,603------------------------ ------------- ------------ ---------Loss per share (14.2p) (13.3p) (15.8p)------------------------ ------------- ------------ --------- Potential ordinary shares are treated as dilutive when and only when theirconversion to ordinary shares would increase loss per share from continuingoperations. Therefore as the total result is a loss the basic and diluted lossesper share are the same for all periods shown. 6. INTANGIBLE ASSET - BRAND Group and Company------------------- 31st December 2005 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000Net book value 18,200 18,200 18,200------------------------ ------------- ------------ --------- The Directors consider that the Group's brand has an indefinite life due to thedurability of the underlying business. This has been demonstrated over manyyears. Accordingly the brand has not been amortised but has instead been subjectto an annual impairment review. The most recent impairment review of the carrying value of the brand wasundertaken by the Directors at 31st December 2006. This review was based on theunderlying business performance of the Liberty brand over the period fromJanuary 2007 to December 2011, and assumed compound sales growth rates of 10.6%,a discount rate of 11.0% and a sales growth rate to perpetuity of 2.25%. Thisconfirmed the value of the Liberty brand at more than the book value of £18.2mat which it has been included in the accounts throughout the year. It hastherefore been retained at that level in these accounts. 7. TANGIBLE FIXED ASSETS Operational properties Freehold Fixtures & property equipment TotalGroup £'000 £'000 £'000-------Cost or valuationAt 1st July 2005 24,608 8,516 33,124Additions 11 2,829 2,840Revaluation 7,529 - 7,529 ------------------------ ------------- ------------ ---------At 31st December 2006 32,148 11,345 43,493------------------------ ------------- ------------ ---------DepreciationAt 1st July 2005 - (5,215) (5,215)Charge for the period (543) (1,691) (2,234)Revaluation 543 - 543------------------------ ------------- ------------ ---------At 31st December 2006 - (6,906) (6,906)------------------------ ------------- ------------ ---------Net book value at 31st December 2006 32,148 4,439 36,587------------------------ ------------- ------------ ---------Net book value at 30th June 2005 24,608 3,301 27,909------------------------ ------------- ------------ --------- Valuation The Group's property, plant and equipment is all located in the United Kingdom.The Group's Operational property was valued at 31st December 2006 by qualifiedprofessional valuers working for the company of DTZ Debenham Tie Leung,Chartered Surveyors, ("DTZ"), acting in the capacity of External Valuers. Allsuch valuers are Chartered Surveyors, being members of the Royal Institution ofChartered Surveyors ("RICS"). The valuation was carried out in accordance with the RICS Appraisal andValuation Standards 5th Edition ("the Manual") and the property was valued onthe basis of Market Value of the Properties. Market Value is defined in theManual as the estimated amount for which a property should exchange on the dateof valuation between a willing buyer and a willing seller in an arm's lengthtransaction after proper marketing, where the parties had each actedknowledgeably, prudently and without compulsion. The DTZ valuation is notqualified by any reference to existing or alternative use and implies the valueto which a property will derive, having regard to its most valuable use. The valuation includes the land and buildings; the trade fixtures, fittings,furniture, furnishings and equipment; and the market's perception of the tradingpotential excluding personal goodwill; together with an assumed ability to renewexisting licences, consents, certificates and permits. The value excludesconsumables and stock in trade. The valuation excludes any goodwill associated with the management by theCompany or its subsidiaries. The Tudor Building valued by DTZ at 31st December 2006 totalled £35.0m. Fixturesand equipment are carried at the lower of cost and realisable value in the tableabove. These assets had a net book value of £4.4m at 31st December 2006. The historic cost of the Group's properties at 31st December 2006 includescapitalised interest of £0.2m (30th June 2005: £0.2m). 8. CREDITORS: amounts falling due within one year 31st December 2005 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000 Bank overdraft 2,211 - -Trade creditors 7,851 7,711 8,124Amounts owed to fellow Groupundertakings - 211 567Corporation tax 135 69 48Other taxes and social security 1,109 1,015 223Other creditors 981 649 704Non-equity dividend payable 82 28 28Accruals and deferred income 2,539 3,973 3,886------------------------ ------------- ------------ --------- 14,908 13,656 13,580------------------------ ------------- ------------ --------- At the 31st December 2006 the Group held an overdraft facility of £4m withBarclays Bank Plc secured by a first charge on the freehold of the Tudorbuilding. 9. MOVEMENT ON RESERVES Merger Reserve Revaluation Profit Reserve £'000 £'000 and loss account £'000 Group-------At 1st July 2005 61,503 4,528 (32,170)Loss retained for the period - - (3,246)Actuarial gain throughreserves - 4,977Surplus arising on revaluationof properties - 8,072 -Currency translationdifferences on foreigncurrency net investments - - (235)Transfer of depreciation on - - -revaluation of fixed assetsUnpaid non-equity preferencedividends - - 35-------------------------- ----------- ----------- -----------At 31st December 2006 61,503 12,600 (30,639)-------------------------- ----------- ----------- ----------- All reserves of the Group are attributable to equity shareholders' interests. Profit and loss AccountCompany £'000---------At 1st July 2005 6,013Loss retained for the period (35)Unpaid non-equity preference dividends 35----------------------------------- --------------------At 31st December 2006 6,013----------------------------------- -------------------- 10. EQUITY SHAREHOLDERS FUNDS PER SHARE The equity shareholders' funds per share figures of the Group are calculated bydividing the equity shareholders' funds at the period end by the number ofordinary shares in issue at that date. They are calculated as follows:- 31st December 2005 31st December proforma 30th June 2006 unaudited 2005 £'000 £'000 £'000Total equity shareholders' funds perconsolidated balance sheet 48,965 40,294 39,397Less Preference share capital (385) (385) (385)------------------------ ------------ ----------- -----------Ordinary shareholders' funds 48,580 39,909 39,012------------------------ ------------ ----------- ----------- '000 '000 '000Number of ordinary shares in issue atperiod end 22,603 22,603 22,603------------------------ ------------ ----------- ----------- Ordinary shareholders' funds per 215p 177p 173pshare ------------ ----------- ----------------------------------- 11. RECONCILIATION OF OPERATING LOSS ON ORDINARY ACTIVITIES TO NET CASH INFLOWFROM OPERATING ACTIVITIES Year ended Year Eighteen months 31st December ended ended 2006 30th June 31st December proforma 2005 2006 unaudited (Restated) £'000 £'000 £'000Operating (loss) / profit onactivities (1,897) (2,047) (2,014)Depreciation 2,234 1,491 2,073Loss on disposal of fixed assets - - 127Increase in stock (832) (653) (312)Decrease/(increase) in debtors 2,157 999 (1,437)(Decrease)/increase in creditors (1,536) (1,680) (8,080)------------------------ ------------ ----------- -----------Net cash (outflow)/inflow fromoperating activities 126 (1,890) (9,643)------------------------ ------------ ----------- ----------- 12. ANALYSIS OF NET DEBT Movement Foreign 31st December during currency 30th June 2006 period translation 2005 £'000 £'000 £'000 £'000Cash and cash equivalents 1,348 (1,930) (352) 3,630Overdraft (2,539) (2,539) - ------------------------ ----------- --------- --------- --------Net (debt) / cash and cashequivalents (1,191) (4,469) (352) 3,630----------------------- ----------- --------- --------- -------- 13. FINANCIAL INFORMATION The financial information set out above does not constitute the Company'sstatutory accounts for the period ended 31st December 2006 or 30th June 2005 butis derived from those accounts. Statutory accounts for the year ended 30th June2005 have been delivered to the Registrar of Companies, and those for theeighteen month period ended 31st December 2006 will be delivered following theCompany's Annual General Meeting. The auditors have reported on those accounts;their reports were unqualified and did not contain statements under Section 237(2) or (3) of the Companies Act 1985. 14. DESPATCH OF ACCOUNTS The audited accounts of the Company are expected to be sent to shareholdersduring April 2007. Thereafter copies will be available from the CompanySecretary, Filex Services Limited, 179 Great Portland Street, London W1W 5LS. This information is provided by RNS The company news service from the London Stock Exchange