23 Sep 2011 07:00
Richoux Group plc
Interim results for the 28 weeks ended 10 July 2011
Richoux Group plc (the "Group"), the owner and operator of Richoux, Zippers, Dean's Diner and Villagio restaurants today announces its unaudited interim results for the 28 week period ending 10 July 2011.
28 weeks ended 10 July 2011 £m | 28 weeks ended 11 July 2010 £m | 52 weeks ended 26 December 2010 £m | |
Turnover from continuing operations | 4.39 | 2.71 | 5.84 |
Gross profit from continuing operations | 0.03 | 0.33 | 0.61 |
Operating (loss)/profit on continuing operations before impairment and onerous lease provision |
(0.25) |
0.09 |
0.14 |
(Loss)/profit attributable to shareholders from continuing and discontinued operations |
(2.57) |
0.44 |
0.51 |
Key points:
§ Currently fifteen restaurants trading.
§ New Villagio concept launched.
§ Established part of the business continues to trade well.
Philip Shotter, Chairman of Richoux Group plc said:
"The Group's established brand, Richoux, continues to trade profitably. Following the significant expansion that the Group undertook towards the end of the last financial year the focus has been on trying to improve and develop the Group's other development concepts, while continuing to assess their longer term viability. Villagio, a modern local style Italian concept is being trialled in four sites."
Enquiries:
Richoux Group plc |
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Philip Shotter, Chairman | (020) 7483 7000 |
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College Hill |
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Matthew Smallwood | (020) 7457 2020 |
Jamie Ramsay |
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| Evolution Securities | (020) 7071 4300 |
Patrick Castle Stuart Andrews |
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Results
Group turnover from our continuing operations for the 28 week period ended 10 July 2011 increased to £4.39 million (July 2010: £2.71 million). Gross profit from continuing operations was £0.03 million (July 2010: £0.33 million). Administrative expenses for continuing operations (before impairment) of £0.28 million (July 2010: £0.24 million) were in line with expectations.
Significant provisions of £2.33 million (July 2010: £nil) have been made for impairment. This relates to the now disposed of site in Bexhill-on-Sea and six other sites which the Board determine to be trading sufficiently below expectations for impairments to be required.
The Directors are not recommending the payment of a dividend.
Operations
The Group currently has fifteen restaurants, which operate under the Richoux, Zippers, Dean's Diner and Villagio brands. Further details on each of the brands are set out below.
Richoux
Richoux restaurants operate in prestigious areas of Central London and offer all day dining.
The Group has four Richoux restaurants and they all continue to trade profitably and in line with expectations.
Zippers
Zippers is a contemporary family restaurant with an extensive range of dishes to suit all tastes.
The Zippers in Chatham is trading well. The Zippers site in Bexhill was trading very disappointingly and the lease of the property has now been surrendered. The further Zippers sites in Andover and Barnet have been rebranded as Villagio.
Dean's Diner
Dean's Diner is a 1950s American Diner style concept.
There are currently six Dean's Diner restaurants open with a new site opening during the period in Port Solent. A further site in Braintree is due to open in October 2011. The focus has been on trying to improve the offering and its positioning in the market through improved service standards and more competitive offers.
Villagio
Villagio is a modern local style Italian restaurant.
There are now four Villagio sites - the recently opened sites in Hammersmith and Berkhamsted and the rebranded restaurants in Andover and Barnet. Trading thus far has been in line with expectations.
Capital expenditure and cash flow
The Board has sought to preserve the cash resources of the Group. As at the end of the period under review the Group held cash of £1.19 million (December 2010: £3.61 million).
Capital expenditure of £0.98 million (July 2010: £0.62 million, December 2010: £3.32 million) was incurred in the period, predominantly on the fit out of the new Dean's Diner restaurant in Port Solent and the new Villagio restaurants in Hammersmith and Berkhamsted.
Outlook
The outlook for the Group remains challenging. The established part of the Group's business continues to trade well, whilst trading across the new concepts is inconsistent from site to site and requires further development and improvement, which the Board are endeavouring to bring about. No further acquisitions are envisaged at present.
Philip Shotter
Chairman
23 September 2011
Richoux Group plc
Condensed consolidated statement of comprehensive income
for the 28 week period ended 10 July 2011
Notes | 28 week period ended 10 July 2011 | 28 week period ended 11 July 2010 | 52 week period ended 26 December 2010 | |
£000 | £000 | £000 | ||
Revenue | 3 | 4,389 | 2,714 | 5,844 |
Cost of sales: | ||||
Excluding pre-opening costs | (4,271) | (2,339) | (4,986) | |
Pre-opening costs | (87) | (42) | (250) | |
Total cost of sales | (4,358) | (2,381) | (5,236) | |
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Gross profit | 31 | 333 | 608 | |
Administrative expenses | (281) | (243) | (467) | |
Other operating income | 1 | - | - | |
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Operating (loss)/profit before impairment | (249) | 90 | 141 | |
Impairment of property, plant and equipment | (2,301) | - | - | |
Impairment of other intangible assets | (26) | - | - | |
Onerous lease provision | - | 333 | 333 | |
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Operating (loss)/profit | (2,576) | 423 | 474 | |
Finance income | 11 | 19 | 32 | |
Finance expense | - | (1) | (1) | |
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(Loss)/profit before taxation | 3 | (2,565) | 441 | 505 |
Taxation | - | - | - | |
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(Loss)/profit and total comprehensive (loss)/profit for the period |
(2,565) |
441 |
505 | |
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(Loss)/profit and total comprehensive (loss)/profit attributable to equity holders of the parent |
(2,565) |
441 |
505 | |
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(Loss)/profit and total comprehensive (loss)/profit per share: | ||||
(Loss)/profit per share | 4 | (3.8)p | 1.1p | 1.1p |
Diluted (loss)/profit per share | 4 | (3.8)p | 1.1p | 1.1p |
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Richoux Group plc
Condensed consolidated statement of changes in equity
For the 28 week period ended 10 July 2011
| Share capital | Share premium account | Profit and loss account |
Total | |
£000 | £000 | £000 | £000 | |
At 27 December 2009 | 1,681 | 10,335 | (7,516) | 4,500 |
Profit for the period | - | - | 441 | 441 |
Credit to equity for equity settled share based payments | - | - | 33 | 33 |
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| At 11 July 2010 | 1,681 | 10,335 | (7,042) | 4,974 |
| Profit for the period | - | - | 64 | 64 |
Credit to equity for equity settled share based payments | - | - | 12 | 12 |
New share capital subscribed | 1,000 | 1,000 | - | 2,000 |
New share capital issue costs | - | (40) | - | (40) |
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| At 26 December 2010 | 2,681 | 11,295 | (6,966) | 7,010 |
| Loss for the period | - | - | (2,565) | (2,565) |
| Credit to equity for equity settled share based payments | - | - | 7 | 7 |
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| At 10 July 2011 | 2,681 | 11,295 | (9,524) | 4,452 |
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Richoux Group plc
Condensed consolidated statement of financial position
at 10 July 2011
| 10 July 2011 | 11 July 2010 | 26 December 2010 | |
Notes | £000 | £000 | £000 | |
| Assets | ||||
Non-current assets | ||||
Goodwill | 234 | 234 | 234 | |
Other intangible assets | 62 | 41 | 82 | |
Property, plant and equipment | 6 | 3,092 | 2,176 | 4,737 |
Investment property | 6 | 787 | 787 | 787 |
Trade and other receivables | 120 | 11 | 82 | |
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| Total non-current assets | 3 | 4,295 | 3,249 | 5,922 |
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| Current assets | ||||
Inventories | 152 | 81 | 158 | |
Trade and other receivables | 699 | 461 | 587 | |
Cash and cash equivalents | 1,192 | 2,500 | 3,606 | |
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| Total current assets | 2,043 | 3,042 | 4,351 | |
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| Total assets | 6,338 | 6,291 | 10,273 | |
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Liabilities | ||||
| Current liabilities | ||||
Trade and other payables | (1,709) | (1,251) | (3,127) | |
Non-current liabilities | ||||
Trade and other payables | (177) | (66) | (136) | |
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Total liabilities | (1,886) | (1,317) | (3,263) | |
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Net assets | 4,452 | 4,974 | 7,010 | |
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Capital and reserves | ||||
Share capital | 2,681 | 1,681 | 2,681 | |
Share premium account | 11,295 | 10,335 | 11,295 | |
Retained earnings | (9,524) | (7,042) | (6,966) | |
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Total equity | 4,452 | 4,974 | 7,010 | |
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Richoux Group plc
Condensed consolidated statement of cash flows
for the 28 week period ended 10 July 2011
| Notes | 28 week period ended 10 July 2011 | 28 week period ended 11 July 2010 | 52 week period ended 26 December 2010 | |
£000 | £000 | £000 | ||
Operating activities | ||||
Cash generated from operations | 7 | - | 43 | 486 |
Interest paid | - | (1) | (1) | |
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Net cash from operating activities | - | 42 | 485 | |
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Investing activities | ||||
Purchase of property, plant and equipment | (2,408) | (616) | (1,874) | |
Purchase intangible assets | (17) | (6) | (58) | |
Proceeds from sale of assets held for sale | - | 102 | 102 | |
Interest received | 11 | 19 | 32 | |
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Net cash used in investing activities | (2,414) | (501) | (1,798) | |
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Financing activities | ||||
Proceeds from issue of ordinary shares | - | - | 2,000 | |
Share issue costs | - | - | (40) | |
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Net cash from financing activities | - | - | 1,960 | |
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Net (decrease)/increase in cash and cash equivalents | (2,414) | (459) | 647 | |
Cash and cash equivalents at the beginning of the period | 3,606 | 2,959 | 2,959 | |
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Cash and cash equivalents at the end of the period | 1,192 | 2,500 | 3,606 | |
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Notes
1. The consolidated financial statements have been prepared in compliance with International Financial Reporting Standards ("IFRS") as adopted by the European Union and therefore the Group financial statements comply with Article 4 of the EU IAS Regulation. The financial statements have been prepared on the historical cost basis.
2. The condensed financial information for the 28 week period ended 10 July 2011 and the 28 week period ended 11 July 2010 has been prepared in accordance with IAS 34 "Interim financial reporting" and should be read in conjunction with the annual financial statements for the period ended 26 December 2010 which have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union. The accounting policies used in preparing the condensed financial information are consistent with those of the annual financial statements for the period ended 26 December 2010. During the period various Standards and Interpretations were adopted in line with the effective dates as outlined in the annual financial statements for the period ended 26 December 2010. The condensed financial information for the 28 week period ended 10 July 2011 and the 28 week period ended 11 July 2010 has not been audited or reviewed and does not constitute full financial statements within the meaning of section 435 of the Companies Act 2006.
The financial information for the 52 week period ended 26 December 2010 does not constitute the Group's statutory accounts for that period but it is derived from those accounts. Statutory accounts for the 52 week period ended 26 December 2010 have been delivered to the Registrar of Companies. The auditors have reported on these accounts; their report was unqualified and did not contain statements under section 498(2) or (3) of the Companies Act 2006.
3. Business segments
Based on the financial information which is monitored by the board, which comprises the chief operating decision maker as defined in IFRS 8, the group has three reportable business segments based around its core restaurant brands, Richoux, Dean's Diner and Zippers and Villagio. The Zippers and Villagio brands are reported together as some of the Zippers restaurants have been/will be rebranded as Villagio restaurants. All brands are engaged in the restaurant trade so derive their revenues and results from similar products and services.
For the 28 week period ended 10 July 2011
Richoux | Zippers/ Villagio | Dean's Diner | Un-allocated |
Total | |
£000 | £000 | £000 | £000 | £000 | |
Revenue | 2,325 | 1,062 | 1,002 | - | 4,389 |
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Segment profit/(loss) | 424 | (129) | (178) | (86) | 31 |
Administrative expenses | - | - | - | (281) | (281) |
Other operating income | 1 | - | - | - | 1 |
Impairment | - | (1,042) | (1,285) | - | (2,327) |
Finance income | - | - | - | 11 | 11 |
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Profit/(loss) before taxation | 425 | (1,171) | (1,463) | (356) | (2,565) |
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Non-current assets as at 26 December 2010 | 1,364 | 1,663 | 1,975 | 920 | 5,922 |
Additions | 12 | 493 | 505 | 5 | 1,015 |
Depreciation and amortisation | (102) | (87) | (95) | (12) | (296) |
Impairment | - | (1,042) | (1,285) | - | (2,327) |
Disposals | (1) | (4) | - | (14) | (19) |
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Non-current assets as at 10 July 2011 | 1,273 | 1,023 | 1,100 | 899 | 4,295 |
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The unallocated segment loss includes the cost of the restaurant area management, and the unallocated administrative expenses include the costs of the Group's head office.
4. (Loss)/profit per share
The calculation of the basic and diluted (loss)/profit per share is based on the following data:
10 July 2011 | 11 July 2010 | 26 December 2010
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£000 | £000 | £000 | |
(Loss)/profit | |||
(Loss)/profit for the purposes of basic (loss)/profit per share being the net (loss)/profit attributable to equity holders of the parent |
(2,565) |
441 |
505 |
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Number of shares | |||
Weighted average number of ordinary shares for the purposes of the basic (loss)/profit per share |
67,019,612 |
42,019,612 |
46,552,579 |
Effect of dilutive potential ordinary shares: | |||
Share options | 327,460 | - | - |
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Weighted average number of ordinary shares for the purposes of the diluted (loss)/profit per share |
67,347,072 |
42,019,612 |
46,552,579 |
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Share options not included in the diluted calculations as per the requirements of IAS 33 (as they are anti-dilutive) |
2,213,255 |
2,664,465 |
2,540,715 |
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5. No dividend is proposed.
6. Property, plant and equipment
Investment property | Short leasehold land and buildings |
Leasehold improve-ments | Fixtures, fittings, and equipment |
Total | |
| Cost | |||||
At 27 December 2009 | 1,153 | 3,444 | 17 | 1,226 | 5,840 |
Additions | - | 383 | - | 233 | 616 |
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At 11 July 2010 | 1,153 | 3,827 | 17 | 1,459 | 6,456 |
Additions | - | 1,856 | - | 850 | 2,706 |
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At 26 December 2010 | 1,153 | 5,683 | 17 | 2,309 | 9,162 |
Additions | - | 598 | - | 362 | 960 |
Disposals | - | (14) | - | (11) | (25) |
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At 10 July 2011 | 1,153 | 6,267 | 17 | 2,660 | 10,097 |
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Accumulated depreciation and impairment | |||||
At 27 December 2009 | 366 | 2,053 | 17 | 921 | 3,357 |
Charge for period | - | 73 | - | 63 | 136 |
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At 11 July 2010 | 366 | 2,126 | 17 | 984 | 3,493 |
Charge for period | - | 74 | - | 71 | 145 |
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At 26 December 2010 | 366 | 2,200 | 17 | 1,055 | 3,638 |
Charge for period | - | 134 | - | 151 | 285 |
Disposals | - | - | - | (6) | (6) |
Impairment | - | 1,723 | - | 578 | 2,301 |
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At 10 July 2011 | 366 | 4,057 | 17 | 1,778 | 6,218 |
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Carrying amount | |||||
At 10 July 2011 | 787 | 2,210 | - | 882 | 3,879 |
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At 26 December 2010 | 787 | 3,483 | - | 1,254 | 5,524 |
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At 11 July 2010 | 787 | 1,701 | - | 475 | 2,963 |
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Impairment testing of property, plant and equipment
The Group considers each trading restaurant to be a cash-generating unit (CGU) and each CGU is reviewed when there are indications of impairment.
The recoverable amounts of the restaurants are calculated from value in use calculations based on cash flow projections from forecasts to December 2016 based on a sales growth rate of 2%. The discount rate applied to cash flow projections is 12%.
During the period an impairment charge of £2,301,000 (July 2010: £nil) has been recognised relating to the unrecoverable elements of assets relating to six Zippers, Villagio and Dean's Diner restaurants based on their forecast value in use and one Zippers restaurant following the decision to close this restaurant.
7. Reconciliation of operating (loss)/profit to operating cash flows
| 28 week period ended 10 July 2011 | 28 week period ended 11 July 2010 | 52 week period ended 26 December 2010 |
£000 | £000 | £000 | |
Operating (loss)/profit | (2,576) | 423 | 474 |
Profit on disposal of assets held for sale | - | (8) | (8) |
Loss on disposal of property, plant and equipment | 19 | - | - |
Loss on disposal of intangible assets | - | - | 4 |
Depreciation charge | 285 | 136 | 281 |
Amortisation charge | 11 | 5 | 12 |
Impairment of intangible fixed assets | 26 | - | - |
Impairment of property, plant and equipment | 2,301 | - | - |
Decrease/(increase) in stocks | 6 | 13 | (64) |
Increase in debtors | (150) | (102) | (299) |
Increase/(decrease) in creditors | 71 | (57) | 441 |
Decrease in provisions | - | (400) | (400) |
Equity settled share based payments | 7 | 33 | 45 |
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Net cash inflow from operating activities | - | 43 | 486 |
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8. Post balance sheet events
On the 18 August 2011 the Group closed and surrendered the lease for its Zippers restaurant in Bexhill-on-Sea.
9. Related party transactions
During the period the Group paid professional fees for legal services in connection with properties of £52,000 (July 2010: £25,000, December 2010: £85,000) to Glovers Solicitors LLP of which Philip Shotter is a member. As at the end of the period £3,000 was outstanding (December 2010: £29,000). This is in addition to fees included in Directors' emoluments.
During the period the Company entered into a new 25 year lease, at an annual rent of £60,000 per annum, with Amberstar Limited a Company in which Phillip Kaye, a significant shareholder, is a Director and significant shareholder.
The Group has a group VAT registration and the representative Company, Richoux Group plc, pays the net VAT for the Group.
Transactions with directors:
Directors' emoluments
28 week period ended 10 July 2011 | 28 week period ended 11 July 2010 | 52 week period ended 26 December 2010 | |
£000 | £000 | £000 | |
Short term employee benefits | 78 | 78 | 145 |
Share based payments | 3 | 21 | 28 |
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81 | 99 | 173 | |
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10. Report and accounts
Copies of the interim report and accounts will be posted to the shareholders shortly and will be available at www.richouxgroup.co.uk.