Richoux Group Regulatory News (RIC)

6 Oct 2005 07:00

Gourmet Holdings PLC06 October 2005 Date 6 October 2005 Contacts Gareth Lloyd-Jones, Chief Executive Gourmet Holdings plc (020) 8394 5555 Trevor Phillips Holborn PR (020) 7929 5599 Gourmet Holdings plc Preliminary Results for the 52 week period ended 26 June 2005 Gourmet Holdings plc owner of Richoux and Bel and the Dragon restaurant brands Group Results Highlights Group Turnover £9.7 million +29 per cent EBITDA £0.9 million +221 per cent Group Operating Profit* £0.4 million + £0.55 million Net Profit £0.3 million - £0.52 million Earnings per share 0.4 pence * Before Interest and Exceptional Profit Item Restaurant Performance Highlights EBITDA (before pre-opening costs) £1.5 million +56 per cent Operating Profit (before pre-opening costs) £1.1 million +90 per cent Commenting, Chief Executive Gareth Lloyd-Jones, said: "We have achieved a lot in the last year and I am delighted to be announcing theGroup's first full year profit. Having taken the time to get the growthstrategy and operation right this year we intend to increase the rate at whichwe open new restaurants." Preliminary Statementfor the 52 week period ended 26 June 2005 We are pleased to be able to report that the Group has recorded its first fullyear operating profit. Results Turnover for the 52 week period ended 26 June 2005 increased by 29 per cent to£9.7 million (2004: £7.6 million) reflecting the addition of the Bel and theDragon business to the existing Richoux business. Gross profit, which is reported net of all associated restaurant pre-openingcosts, for the same period increased by 75 per cent to £1.0 million (2004: £0.6million). Administrative expenses before goodwill amortisation for the period reduced by16 per cent to £0.6 million (2004: £0.7 million). As a result the Group made an operating profit before interest, tax andexceptional items of £0.4 million (2004: loss £0.1 million). Net interest payable for the period relates to interest earned on cash depositsless the interest payable on the term loans taken against the freeholdproperties bought by the Group and was £0.2 million (2004: £nil). During theperiod an exceptional profit was realised on the disposal of a propertyamounting to £0.1 million (2004: £0.9 million) Net Profit before tax was £0.3 million against £0.8 million in 2004, whichincluded an exceptional profit arising on the disposal of our coffee operations. Earnings per share were 0.4 pence (2004: 1.4 pence). Strategy A noted trend in recent years within our sector is the customer's desire to eatout more, which has been driven, amongst other reasons, by the increasingaffordability and availability offered by hospitality operators. Our strategy is simple - we aim to build a strong UK restaurant business capableof long-term sustainable growth. By continuing to improve our customers' experience at all our restaurantscoupled with our plans to accelerate the rollout of restaurants in each of thesegments in which we operate we believe that we have the right strategy toincrease earnings and shareholder value in the future. Operations Richoux is a great restaurant business serving customers an all-day diningexperience. The menu consists of breakfasts, morning coffee, lunch, afternoontea and evening meals; featuring many "traditional favourites" which makes theoffer easy for customers to understand. Richoux has now demonstrated that it has a strong business model which iscapable of sustaining growth in the future. During the past year we have invested more than ever before to improve ourcustomers' experience at Richoux. We accelerated our refurbishment programme ofrestaurants, which particularly benefited our Mayfair restaurant by addingadditional covers. We have worked hard both at improving the outstandingquality of the food we serve and the level of customer service we give thoughstaff training. These efforts helped deliver a record financial performance with trading profitsincreasing by a creditable 50% on the corresponding period last year. Our pub-restaurant business currently comprises Bel and the Dragon. We believethat the quality pub-restaurant sector is a rapidly growing market within therestaurant and hospitality industry and has excellent long-term prospects. The Bel and the Dragon offer is an impressive customer proposition, whichoperates in the quality residential and semi-rural area of the restaurant marketoften using traditional public houses as trading locations. Last year we invested in areas that mattered to our customers to improve theirdining experience. Bel and the Dragon serves some of the finest quality foodtogether with excellent service within comfortable surroundings. This year we see an opportunity to upscale the rate of growth we can achieve byincreasing the number of restaurants we own and operate within thepub-restaurant market by tailoring our offer to meet our customers' needs. For example our new restaurant, The Five Bells in Stanbridge, Hertfordshireopened in November 2004, features many of the "Bel" classics but also has anumber of dishes specifically tailored to the market in which it operates. Thecustomers' response has been very positive and we will continue to put a lot ofenergy into tailoring each and every new restaurant's offer so that it appealsto local demographics. Capital Expenditure and Cashflow Cash generated from trading activities before accounting for movements inworking capital was £0.9 million (2004: £0.3 million). Capital expenditure of £1.5 million (2004: £0.1 million) was incurred during theperiod. People On behalf of our shareholders, I should like to thank all of our people fortheir hard work and dedication that made the progress of last year possible. Outlook We have made good progress in building the necessary infrastructure to grow yourCompany. Since the year-end we have seen some softening in our Central Londonrestaurants but this is something that, from experience, we anticipate will beshort lived. Our other restaurants have traded in line with our expectations. Looking to the future, Gourmet Holdings continues to have really excitingprospects to expand and grow. Nigel WhittakerChairman Gareth Lloyd JonesChief Executive Consolidated profit and loss accountfor the 52 week period ended 26 June 2005 52 week 52 week period period ended ended 26 June 27 June 2005 2004 Notes Acquisition Continuing Discontinued Total Total £'000 £'000 £'000 £'000 £'000 Turnover 4,713 5,036 - 9,749 7,568Cost of sales:Excluding pre-opening costs (4,096) (4,537) - (8,633) (6,980)Pre-Opening costs (74) (10) - (84) - (4,170) (4,547) (8,717) (6,980) Gross profit 543 489 - 1,032 588Administrative expenses:Administrative expenses - (608) - (608) (728)Amortisation (61) (19) - (80) (19) (61) (627) - (688) (747) Other operating income - 77 - 77 30 Operating (loss)/profit 482 (61) - 421 (129) Net profit/(loss) on disposalof tangible fixed assets (4) - - (4) 33Profit on sale of discontinuedoperation 4 - - 100 100 871 (Loss)/Profit on ordinaryactivities before interest 478 (61) 100 517 775 Interest receivable 75 44 Interest payable and similarcharges (312) (22) Profit/(loss) on ordinaryactivities before taxation 280 797 Taxation on profit/(loss)ordinary activities - - Profit/(loss) for thefinancial period 280 797 Earnings per share 6 0.4p 1.4p Diluted earnings per share 6 0.4p 1.4p There are no differences between historical cost profit and that recorded in theprofit and loss account (2004: £nil) Consolidated balance sheetat 26 June 2005 26 June 2005 27 June 2004 £'000 £'000 £'000 £'000 Fixed assetsIntangible assets 1,439 1,495Tangible assets 8,987 7,835 10,426 9,330 Current assetsStocks 198 158Debtors 570 756Cash at bank and in hand 1,125 2,714 1,893 3,628Creditors: amounts falling due within oneyear (2,255) (2,975) Net current (liabilities)/assets (362) 653 Total assets less current liabilities 10,064 9,983Creditors: amounts falling due after morethan one year (3,739) (3,938) Net assets 6,325 6,045 Capital and reservesOrdinary shares 789 789Preference shares 1,088 1,088 Called up share capital 1,877 1,877Share premium account 11,815 11,815Warrants reserve 50 50Profit and loss account (7,417) (7,697) Equity shareholders' funds 5,237 4,957Non-equity shareholders' funds 1,088 1,088 Shareholders' funds 6,325 6,045 Consolidated cash flow statementfor the 52 week period ended 26 June 2005 Note 52 week 52 week period period ended ended 26 June 27 June 2005 2004 £'000 £'000Net cash inflow from operatingactivities 8 350 924 Returns on investments and servicingof finance (178) 16 Capital expenditure and financialinvestment (1,510) (27) Acquisitions and disposals 131 (2,960) Cash outflow before financing (1,207) (2,047) Financing (167) 4,241 (Decrease)/increase in cash in theperiod (1,374) 2,194 Notes 1. There have been no changes to the main accounting policies used by the Group over the period. 2. The financial information set out above does not constitute the Company's statutory accounts for the years ended 26 June 2005 or 27 June 2004 but it is derived from those accounts. Statutory accounts for 2004 have been delivered to the Registrar of Companies, and those for 2005 will be delivered following the Company'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. 3. The consolidated financial statements include the financial statements of the Company and its subsidiary undertakings made up to 26 June 2005. The results of all subsidiary undertakings are consolidated. Intra-group sales are fully eliminated on consolidation. 4. Profit on sale of discontinued operation During the period the Company received £100,000 following the completion of an outstanding property transaction relating to the sale of City Gourmets Limited. 5. Acquisition of subsidiary undertaking Since 27 June 2004 adjustments to the consideration paid for the acquisition of the entire share capital of BDC Holdings Limited and its subsidiaries Bel and the Dragon (Cookham) Limited and Bel and the Dragon (Properties) Limited were agreed: Provisional fair value at Final fair value at date of acquisition date of acquisition Movement £'000 £'000 £'000 Cash 3,054 3,058 4Loan notes 340 340 -Ordinary shares 150 150 -Deferred cash 270 250 (20)Acquisition costs 266 251 (15) 4,080 4,049 (31) Tangible fixed assets 5,978 5,997 19Stock 65 67 2Debtors 120 103 (17)Cash and overdrafts (184) (184) -Liabilities (686) (727) (41)Deferred corporation tax (60) (60) -Bank loans (2,341) (2,341) -Net assets 2,892 2,855 (37)Goodwill 1,188 1,194 6 4,080 4,049 (31) 6. Earnings per share The earnings per share are calculated by reference to the profit after taxation and the weighted average number of ordinary shares in issue during the period of 78,904,294 (2004: 55,161,872). The earnings per share for both basic and fully diluted earnings per share are calculated on the basis of a profit for the period of £280,000 (2004: £797,000). The diluted earnings per share is calculated by reference to the profit after taxation and the weighted average number of ordinary shares and share options in issue during the period of 79,691,632 (2004: 55,365,263). Share options, warrants and the conversion of preference shares not included in the diluted calculations as per the requirements of FRS 14 (as they are anti-dilutive) totalled 3,483,880 (2004: 2,868,666). 7. No dividend is proposed. 8. Reconciliation of operating loss to operating cash flows 52 week 52 week period period ended ended 26 June 27 June 2005 2004 £'000 £'000 Operating profit/(loss) 421 (129)Depreciation charge 359 376Amortisation charge 80 19Increase in stocks (40) (30)Decrease in debtors 169 52(Decrease)/increase in creditors (639) 636Net cash inflow from operating activities 350 924 9. Reconciliation of net cash flow to movement in net debt 52 week 52 week period ended period ended 26 June 2005 27 June 2004 £'000 £'000 (Decrease)/increase in cash in the period (1,374) 2,194 Cash outflow/(inflow) from changes in debt and lease financing 167 (1,620)Change in net funds/ resulting from cash flows (1,207) 574New finance leases (4) (4)Finance leases sold with subsidiary undertakings - 1Loans and finance leases acquired with subsidiary undertakings - (2,342)Movement in net debt in the period (1,211) (1,771)Net (debt)/funds at the start of the period (1,605) 166Net debt at the end of the period (2,816) (1,605) This information is provided by RNS The company news service from the London Stock Exchange