Leeds Group Regulatory News (LDSG)

10 May 2006 07:30

Leeds Group PLC10 May 2006 Issued on behalf of Leeds Group plcDate: Wednesday, 10 May 2006 Embargoed: 7.30am Leeds Group plc Interim Results for the six months ended 31st March 2006 STATEMENT BY THE GROUP CHAIRMAN, VIN MURRIA Group ResultsI am pleased to report that the Group's profit before tax and exceptional itemsfor the six months ended 31 March 2006 was £514,000, an improvement of 65% overthe corresponding period last year. It should be noted that these resultscontain only one month of trading for our former subsidiary Leeds Leasing priorto its sale on 31 October 2005. Profit before tax and exceptional items in the continuing operations wassignificantly higher than the comparative period last year, up from £63,000 to£493,000, and compares favourably with the £338,000 reported for the 2005financial year as a whole. Cost reductions and the interest earned on the proceeds of the sale of LeedsLeasing led to a reduction of £86,000 in Central costs; however the principalcause of the improvement in profitability can be attributed to Hemmers-Itex, ourGerman operation, where following a strong recovery in the second half of ourlast financial year, further progress has been achieved to record a pre-taxprofit of £511,000 in the first half of this year (2005: £167,000). Thisreflects both improved trading conditions generally, and also the success ofHemmers' strategy to directly target manufacturers of ready-made items inaddition to our traditional customer base of fabric retailers. The sale of Leeds Leasing gave rise to an exceptional loss, inclusive ofdisposal costs, of £837,000. The Group's tax charge increased in line with theprofitability of Hemmers-Itex, and the overall loss after tax amounted to£561,000 (2005: profit £240,000). In the six months ended 31 March 2006, the Group purchased through its buy-backprogramme 800,000 ordinary shares at a cost of £161,000, bringing the totalnumber of shares held in treasury to 1,250,000 or 3.4% of the total shares inissue. Strategy & OutlookWe remain confident about the prospects of our continuing operations, where theorder book continues to run at record levels. Following a movement in net debtin the period of £19.7 million, most of which related to the sale of LeedsLeasing, the Group's balance sheet is strong with net funds exceeding £3.3million, equivalent to 9.2 pence per share. The Board continues to exploreopportunities to re-invest these funds wisely; in the meantime we will continueour policy of buying in Group shares to be held in treasury when this isconsidered to be in the best interests of shareholders. DividendAlthough at this stage in the Group's development there is no interim dividendbeing paid, the Directors will give further consideration to dividend policylater this year taking into account the results for the year as a whole and thepossible acquisition opportunities that by then may have been identified. Enquiries:Vin Murria / Ewen Wigley Fiona TooleyLeeds Group plc Citigate Dewe Rogerson LtdTel: 020 7831 5088 / 020 7256 3956 Tel: 0121 455 8370 Mobile: 07785 703523 -2- Leeds Group plc Interim Results Consolidated Profit and Loss Account Unaudited - six months to 31 March 2006 Unaudited - six months to 31 March 2005 Continuing Discontinued Total Continuing Discontinued Total operations operations £000 operations operations £000 £000 £000 £000 £000 Turnover 8,755 255 9,010 6,548 1,506 8,054Cost of sales (6,569) (24) (6,593) (4,886) (135) (5,021) ------------------------------------------------------------------------Gross profit 2,186 231 2,417 1,662 1,371 3,033 Distributioncosts (468) - (468) (402) - (402) Administrativeexpenses (1,253) (125) (1,378) (1,188) (671) (1,859) ------------------------------------------------------------------------Operatingprofit 465 106 571 72 700 772 Exceptionalloss on saleof a businessoperation (837) - (837) - - - ----------------------------------------------------------------------- (Loss)/profitbeforeinterest (372) 106 (266) 72 700 772 ----------------------- -----------------------Net interestpayable (57) (460) -------- ------- (Loss)/profiton ordinaryactivitiesbeforetaxation (323) 312 Taxation on(loss)/profiton ordinaryactivities (238) (72) -------- ------- (Loss)/profitfor the period (561) 240 -------- -------Basic and diluted (loss)/earnings per share before exceptional items 0.7p 0.7pexceptional items (2.3)p - -------- -------after exceptional items (1.6)p 0.7p -------- ------- Consolidated statement of total recognised gains and losses (Loss)/profit for the period (561) 240 Foreign currency translation differences 124 26 -------- -------Total recognised gains and losses for the period (437) 266 -------- ------- -3- Leeds Group plc Interim Results Consolidated Profit and Loss Account Unaudited - six months to 31 March 2006 Audited - year to 30 September 2005 Continuing Discontinued Total Continuing Discontinued Total operations operations £000 operations operations £000 £000 £000 £000 £000 Turnover 8,755 255 9,010 14,113 3,075 17,188 Cost of sales (6,569) (24) (6,593) (10,483) (287) (10,770) ---------------------------------------------------------------------Gross profit 2,186 231 2,417 3,630 2,788 6,418 Distributioncosts (468) - (468) (937) - (937) Administrativeexpenses (1,253) (125) (1,378) (2,327) (1,402) (3,729) ---------------------------------------------------------------------Operatingprofit 465 106 571 366 1,386 1,752 Exceptional(loss)/profiton sale of abusinessoperation (837) - (837) 135 - 135 --------------------------------------------------------------------- (Loss)/profitbeforeinterest (372) 106 (266) 501 1,386 1,887 ------------------------ ------------------------Net interestpayable (57) (952) -------- ------- (Loss)/profiton ordinaryactivitiesbeforetaxation (323) 935 Taxation on(loss)/profiton ordinaryactivities (238) (236) -------- -------(Loss)/profitfor the period (561) 699 -------- ------- Basic and diluted (loss)/earnings per share before exceptional items 0.7p 1.5pexceptional items (2.3)p 0.4p -------- -------after exceptional items (1.6)p 1.9p -------- ------- Consolidated statement of total recognised gains and losses (Loss)/profit for the period (561) 699Foreign currency translation differences 124 (25) -------- -------Total recognised gains and losses for the period (437) 674 ======== ======= -4- Leeds Group plc Interim Results Consolidated Balance Sheet Unaudited Unaudited Audited As at As at As at 31st March 31st March 30th September 2006 2005 2005 £000 £000 £000Fixed assets Intangibleassets 825 909 853 Tangibleassets 303 451 449 ---------- ---------- ----------- 1,128 1,360 1,302 Current assets Stock 4,297 3,616 4,170 ---------- ---------- -----------Debtors 3,646 3,963 5,062 Deferredtaxation 52 875 875 Finance leasedebtors - 19,110 20,606 ---------- ---------- -----------Total debtors 3,698 23,948 26,543 Cash at bankand in hand 4,878 812 756 ---------- ---------- ----------- 12,873 28,376 31,469 Creditors:amountsfalling duewithin oneyear (2,955) (11,851) (13,676) ---------- ---------- -----------Net currentassets 9,918 16,525 17,793 Of which: ---------- ---------- ----------- due within one year 9,866 4,510 4,708 due after more than one year 52 12,015 13,085 ---------- ---------- ----------- ---------- ---------- -----------Total assetsless currentliabilities 11,046 17,885 19,095 Creditors:amountsfalling dueafter morethan one year - (6,588) (7,451) ---------- ---------- -----------Net assets 11,046 11,297 11,644 ========== ========== =========== Share capital andreserves Called upequity sharecapital 4,392 4,392 4,392 Profit andloss account 6,654 6,905 7,252 ---------- ---------- -----------Equityshareholders'funds 11,046 11,297 11,644 ========== ========== =========== Reconciliation of movements in equity shareholders' funds (Loss)/profitfor the period (561) 240 699 Purchase ofown shares (161) - (61) Foreign currencytranslationdifferences 124 26 (25) ---------- ---------- ----------- Net transfer(from)/toequityshareholders'funds (598) 266 613 Equityshareholders'funds atbeginning ofthe period 11,644 11,031 11,031 ---------- ---------- ----------- Equityshareholders'funds at endof the period 11,046 11,297 11,644 ========== ========== =========== -5- Leeds Group plc Interim Results Consolidated Cash Flow Statement Unaudited Unaudited Audited Six months to Six months to Twelve months to 31st March 2006 31st March 2005 30th September 2005 £000 £000 £000 Cashinflow/(outflow) fromoperatingactivities 818 1,005 (626) Returns oninvestmentsand servicingof finance (57) (460) (952) Taxation (361) (263) (266) Capitalexpenditureand financialinvestment (23) (11) (129) Acquisitionsand disposals 4,847 - 135 ---------- ---------- ----------- Net cashinflow/(outflow) beforefinancing 5,224 271 (1,838) Financing (939) (437) 1,279 ---------- ---------- ----------- Increase/(decrease) in cashin the period 4,285 (166) (559) ========== ========== =========== Reconciliation of net cash flow to movement in net debt Increase/(decrease) in cashin the period 4,285 (166) (559) Netdecrease/(increase) in loans 778 437 (1,340) ---------- ---------- ----------- Change in netdebt resultingfrom cashflows 5,063 271 (1,899) Net debtdisposed ofwithsubsidiary 14,726 - - Foreigncurrencytranslationdifferences (56) (12) 11 ---------- ---------- ----------- Movement innet debt inthe period 19,733 259 (1,888) Net debt atthe beginningof the period (16,382) (14,494) (14,494) ---------- ---------- -----------Netfunds/(debt)at the end ofthe period 3,351 (14,235) (16,382) ========== ========== ========== Reconciliation of operating profit to net cashinflow/(outflow) from operating activities Operatingprofit 571 772 1,752 Depreciationof fixedassets 55 122 235 Amortisationof goodwill 48 47 93 Loss on saleof tangiblefixed assets - 1 4 (Increase)/decrease instocks (30) 272 (321) Decrease/(increase) indebtors 600 921 (215) (Decrease)/increase increditors (396) (348) 104 Increase infinance leasedebtors (30) (782) (2,278) ---------- ---------- -----------Net cashinflow/(outflow) fromoperatingactivities 818 1,005 (626) ========== ========== =========== -6- Leeds Group plc Interim Results Notes to the accounts 1. The financial information in this report does not constitute statutoryaccounts within the meaning of Section 240 of the Companies Act 1985. Theinterim accounts for the six months ended 31st March 2006 and 31st March 2005are unaudited. The comparative figures for the financial year ended 30thSeptember 2005 are not the Group's statutory accounts, but have been extractedfrom those accounts, which have been filed with the Registrar of Companies andon which the Group's auditor gave an unqualified report that did not containstatements under Section 237 (2) or (3) of the Companies Act 1985. The interimaccounts have been prepared on the basis of the accounting policies set out inthe 2005 Annual Report. 2. Earnings per share have been calculated on an average of 36,061,790 (2005:36,598,603) ordinary shares of 12 pence each in issue during the period. 3. The table below sets out a segmental analysis of the Group's operations. Turnover Profit before taxation Six Six Twelve Six Six Twelve months months months to months months months to to to to to 31st 31st 30th 31st 31st 30th March March September March March September 2006 2005 2005 2006 2005 2005 £000 £000 £000 £000 £000 £000 Hemmers-Itex 8,755 6,548 14,113 612 247 741 Central - - - (147) (175) (375)costs ---------------------------------------------------------------- Continuing 8,755 6,548 14,113 465 72 366operations Leeds 255 1,506 3,075 106 700 1,386Leasing ---------------------------------------------------------------- 9,010 8,054 17,188 571 772 1,752 ============================== Exceptional(loss)/profiton sale of abusinessoperation (837) - 135 ---------------------------------(Loss)/profitbeforeinterest (266) 772 1,887 Interest --------------------------------Hemmers-Itex (101) (80) (168) Holdingcompanies 129 71 140 Leeds Leasing (85) (451) (924) -------------------------------- Net interestpayable (57) (460) (952) -------------------------------- (Loss)/profitbeforetaxation (323) 312 935 ================================ This information is provided by RNS The company news service from the London Stock Exchange