3 Feb 2009 07:00
3 FEBRUARY 2009
MBL Group plc
("the Group")
TRADING UPDATE
The Board of MBL Group plc, the UK distributor of home entertainment products, today provides shareholders with an update on its trading performance for the three months to 31 December 2008 and developments within the market.
Trading Performance
Total sales £65.2m, an increase of 85.2% (2008: £35.2m)
Distribution sales £62.1m, an increase of 92.8% (2008: £32.2m)
Wholesale sales £3.1m, an increase of 0.3% (2008: £3.0m)
Gross margin has experienced a material reduction due to a change in sales product mix to accommodate market opportunities
Distribution, which services general retailers, experienced a substantial increase in sales during the three month period due to an exceptional demand from customers of Entertainment UK, which went into administration in late November. The increase in sales represented demand for chart and new release products in the critical Christmas trading period which are sold at significantly lower sales margins.
The performance at Wholesale improved slightly reflecting the reduction of competition within its market.
Market Developments
There has been a major change to the market in which the Group operates, most significantly the departure of Entertainment UK during such a critical trading period. Suppliers, customers and competitors to Entertainment UK are evaluating the changes and prospects that this may create.
Outlook
The Group has experienced an exceptional trading performance due to extraordinary market conditions in the period. The Board expects a return to normal trading activity levels and does not currently have any long term agreements with its customer base for the supply of chart and new release products.
The Board recognises that trading during the three months to 31 December 2008, combined with a solid first half, provides much confidence for the outcome for the full year to 31 March 2009 but does not presently anticipate that such trading levels experienced in the third quarter will continue as market conditions stabilise.
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Enquiries:
MBL GROUP PLC Tel: 0161 767 1620
Peter Cowgill, Chairman
BISHOPSGATE COMMUNICATIONS LIMITED Tel: 020 7562 3350
Maxine Barnes / Siobhra Murphy
SEYMOUR PIERCE LIMITED Tel: 020 7107 8000
Mark Percy