Richoux Group Regulatory News (RIC)

31 Mar 2006 07:01

Gourmet Holdings PLC31 March 2006 Gourmet Holdings plc Interim results for the 28 weeks ended 8 January 2006 Gourmet Holdings plc, the owner and operator of two restaurant concepts, Richouxand Bel and the Dragon, today announces its interim results. 6 months ended 8 6 months ended 9 January 2006 January 2005 £m £m Turnover 5.60 5.35Gross profit 0.43 0.68EBITDA 0.21 0.56Loss before taxation 0.16 Profit 0.31 Key points: Operational • Richoux - Excellent increased profit contribution year on year due to improved operational efficiencies - Difficult beginning of period due to impact of London bombings - Plan to roll-out this concept firstly in London • Bel and the Dragon - Majority of sites performed in line with expectations but two underperforming restaurants disposed - Focus to be on urban and semi-urban locations for future expansion - Final Bel and the Dragon, Reading, acquired in December with encouraging performance Financial • £0.40 million exceptional gain relating to the redemption of outstanding preference shares • Successful placing raised £5.20 million • Cash at bank and in hand £3.35 million at period end • Capital reorganisation and capital reduction now completed • Positive reserves • Net asset value of 30.5p per share Nigel Whittaker, Chairman of Gourmet Holdings plc said: "Your Company owns two excellent restaurant brands, both of which have thecapability of being rolled out. Using the proceeds of the placing we arefocused on growing the profitability of the Group through the opening ofadditional restaurants and we remain on track to deliver on our financial planput in place prior to the placing in November 2005." 31 March 2006 EnquiriesGourmet Holdings plcGareth Lloyd-Jones, Chief Executive (020) 8394 5555 College HillMatthew Smallwood (020) 7457 2020Justine Warren Introduction Despite the Company recording a small loss during the period progress has beenmade in a number of areas. Richoux suffered the effects of the London bombingsbut has bounced back impressively and Bel and the Dragon has performed as weexpected in all but two units that we have now transferred out of the Group'scontinuing operations. The Group are owners of two excellent brands that match our criteria forexpansion. Our focus now is on delivering increasing profits from units thatproduce higher margin. This strategy is applicable and achievable in both ourbrands. We are confident that your Company can grow and will deliver value toshareholders. Results Group turnover from our continuing operations for the 28-week period ended 8January 2006 increased to £5.60 million (2005: £5.35 million). Gross Profit fromthe restaurants was £0.43 million (2005: £0.68 million) reflecting the impact oftwo underperforming locations that have since been disposed. Administrativeexpenses were £0.43 million (2005: £0.36 million), which were in line withexpectations. Group EBITDA, before the exceptional item, was £0.21 million(2005: £0.56 million). The loss on ordinary activities before taxation was £0.16million (2005: profit £0.31 million). During the period the Group realised an exceptional gain of £0.40 millionrelating to the redemption of outstanding preference shares. The Board continues its focus on reviewing its cost base, to reflect the shapeand size of the Company. The Directors are not recommending a dividend in line with the Company's policyto invest in the continued development of the business. Operations Richoux Richoux suffered an extremely difficult beginning of the period due to theimpact of the London bombings in July 2005, which as already reported adverselyimpacted top line sales during that time. However, Richoux has demonstrated its resilience and quality by recording aprofit contribution for the period that actually increased year on year. Italso benefited from operational efficiency measures implemented in previousperiods. We are now actively looking to expand the number of Richouxrestaurants we operate utilising the funds raised from the planning last year.Richoux is a flexible brand and the Board believes that it can operate verysuccessfully in locations other than Central London. It is a casual diningbrand, which would flourish in any mass-market location. The Group is currentlyevaluating a number of potential sites for a measured roll-out. Bel and the Dragon The core Bel and the Dragon restaurants performed in line with our expectationsduring the period though in terms of profit were less than last year. The overall performance of this division was however adversely impacted by theunderperformance of two pub / restaurants which failed to meet the financialcriteria expected and impacted these results by £0.2 million and are expected toimpact full year results by £0.4 million. The Directors believe that these pub/ restaurants failed on account of their rural location and we have resolved toconcentrate only on urban and semi urban locations for future openings. Boththese restaurants have been transferred out of the Group's continuing operationsat no cost without compromising the opportunities for the Group to acquire thefreehold interests of the property. In December 2005 we acquired the Bel and the Dragon in Reading where earlytrading indications are encouraging. We continue to seek sites for this brand although the expansion for this brandwill largely be dictated by our ability to find truly special locations at theright price. Again the Board's focus is on building this brand's profitabilityrather than speed of roll-out. Corporate activity During the period your Company set about a number of changes to reorganise thestructure of the Company. In December 2005 we successfully raised £5.2 million (£4.9 million net ofexpenses). As we stated at the time in the circular to shareholders we used£0.7 million of the placing monies to redeem all the outstanding preferenceshares totalling £1.1 million. An exceptional gain to reserves of £0.4 millionis recorded within these results. In December 2005 we completed the consolidation of the Company's Ordinary shareson the basis of one new ordinary share for every four ordinary shares. Also in December 2005 we acquired Bel and the Dragon (Reading) Limited for aconsideration of up to £3.85 million completing the acquisition of the Bel andthe Dragon group of restaurants. In January 2006 we completed the capital reduction process, which has left theCompany with positive reserves. Outlook The Group has much opportunity with two excellent brands whose core units tradewell and have demonstrated the criteria from which a larger estate can be built.We are seeking to expand both Richoux and Bel and the Dragon in a measured waythat will deliver value to shareholders. Trading since the period end has been in line with our expectations and weremain on track to deliver on our financial plan put in place prior to theplacing in November. Gourmet has an exciting future and we are confident that the coming year will bea period of progress. Gourmet Holdings plc Consolidated profit and loss account for the 28 week period ended 8 January 2006 28 week 28 week 52 week period ended period ended period ended 8 January 9 January 26 June 2006 2005 2005 Notes Cont- Discon- Total Acqui- Cont- Discon- Total Acqui- Cont- Discon- Total inuing tinued sition inuing tinued sition inuing tinued £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Turnover 5,278 326 5,604 2,515 2,833 - 5,348 4,713 5,036 - 9,749Cost of sales:Excludingpre-openingcosts (4,853) (325) (5,178) (2,078) (2,582) - (4,660) (4,096) (4,537) - (8,633)Pre-opening costs 3 - - - (10) - - (10) (74) (10) - (84) (4,853) (325) (5,178) (2,088) (2,582) - (4,670) (4,170) (4,547) - (8,717)Gross profit 425 1 426 427 251 - 678 543 489 - 1,032Administrativeexpenses:Administrative expenses (430) - (430) - (358) - (358) - (608) - (608)Amortisation (43) - (43) - (44) - (44) (61) (19) - (80) (473) - (473) - (402) - (402) (61) (627) - (688)Other operatingincome 4 1 - 1 - 61 - 61 - 77 - 77Operating(loss)/profit (47) 1 (46) 427 (90) - 337 482 (61) - 421 Net loss ondisposal offixed assets (1) - (1) - - - - (4) - - (4)Profit on saleofdiscontinued operation - - - - - 100 100 - - 100 100(Loss)/profiton ordinaryactivitiesbeforeinterest (48) 1 (47) 427 (90) 100 437 478 (61) 100 517Interest receivable 26 44 75Interestpayable andsimilar charges (138) (168) (312)(Loss)/profiton ordinaryactivitiesbeforetaxation (159) 313 280Taxation on(loss)/profiton ordinary activities - - -(Loss)/profitfor thefinancial period (159) 313 280(Loss)/earnings pershare 6 (0.7)p 1.6p 1.4pDiluted (loss)/earnings pershare 6 (0.7)p 1.6p 1.4p There are no differences between the historic cost profit and that recorded inthe profit and loss account (2005: £nil). Gourmet Holdings plc Consolidated balance sheet at 8 January 2006 Restated Restated Note 8 January 2006 9 January 2005 26 June 2005 £'000 £'000 £'000 £'000 £'000 £'000 Fixed assets Intangible assets 2,155 1,529 1,439Tangible assets 12,185 8,097 8,987 14,340 9,626 10,426Current assets Stocks 221 194 198Debtors 569 437 570Cash at bank and in hand 3,349 2,292 1,125 4,139 2,923 1,893Creditors: amounts falling duewithin one year (2,135) (3,406) (3,343) Net current assets/ (liabilities) 2,004 (483) (1,450) Total assets less current 16,344 9,143 8,976liabilities Creditors: amounts falling dueafter more than one year (5,927) (3,873) (3,739) Net assets 10,417 5,270 5,237 Capital and reserves Ordinary shares 1,367 789 789Called up share capital 1,367 789 789Share premium account 9 8,757 11,815 11,815Warrants reserve 50 50 50Profit and loss account 243 (7,384) (7,417)Shareholders' funds 10,417 5,270 5,237 Gourmet Holdings plc Consolidated cash flow statement for the 28 week period ended 8 January 2006 Note 28 week 28 week 52 week period period period ended ended ended 8 January 9 January 26 June 2006 2005 2005 £'000 £'000 £'000Cash (Outflow)/inflow from operatingactivities 10 (371) 285 350Returns on investments and servicing offinance (120) (61) (178)Capital expenditure and financialinvestment (213) (461) (1,510) Acquisitions and disposals (2,873) 100 131 Cash outflow before financing (3,577) (137) (1,207) Financing 5,801 (70) (167)Increase/(decrease) in cash in theperiod 2,224 (207) (1,374) Reconciliation of net cash flow to movement in net debt For the 28 week period ended 8 January 2006 28 week 28 week 52 week period period period ended ended ended 8 January 9 January 26 June 2006 2005 2005 £'000 £'000 £'000Increase/(decrease) in cash in the period 2,224 (207) (1,374)Cash (inflow)/outflow from changes in debt and (1,551) 70 167lease financingChange in net funds resulting from cash flows 673 (137) (1,207)New finance leases - (4) (4)Loans and finance leases acquired with (750) - -subsidiary undertakingsMovement in net debt in the period (77) (141) (1,211)Net debt at the start of the period (2,816) (1,605) (1,605)Net debt at the end of the period (2,893) (1,746) (2,816) Gourmet Holdings plc Consolidated statement of total recognised gains and losses for the 28 week period ended 8 January 2006 28 week 28 week 52 week period period period ended ended ended 8 January 9 January 26 June Note 2006 2005 2005 £'000 £'000 £'000 (Loss)/profit for the financial period (159) 313 280 Gain on redemption of preference shares 408 - - Reduction in share premium 9 7,411 - - Total recognised gains and losses relating to thefinancial period 7,660 313 280 Reconciliation of movement in shareholders' funds for the 28 week period ended 8 January 2006 28 week 28 week 52 week period period period ended ended ended 8 January 9 January 26 June 2006 2005 2005 £'000 £'000 £'000 (Loss)/profit for the financial period (159) 313 280 New share capital subscribed (net of issue costs) 4,931 - - Redemption of preference shares (680) - - Net increase in shareholder's funds 4,092 313 280 Opening shareholders' funds 6,325 6,045 6,045 Closing shareholder's funds 10,417 6,358 6,325 Notes 1. The financial information for the 28 week period ended 8 January 2006has been prepared in accordance with the company's accounting policies asdisclosed in the financial statements for the period ended 26 June 2005. The financial information for the 28 week period ended 8 January 2006 and the 28week period ended 9 January 2005 have not been audited and does not constitutefull financial statements within the meaning of s240 of the Companies Act 1985. The financial information relating to the 52 week period ended 26 June 2005 doesnot constitute full financial statements within the meaning of s240 of theCompanies Act 1985, but it is an extract from the audited financial statementsfor that period on which the auditors gave an unqualified report. A copy ofthose financial statements has been filed with the Registrar of Companies. The Group will adopt FRS 21 and elements of FRS 25 for its financial statementsfor the year ending 25 June 2006. Accordingly, non-equity capital instrumentshave been reclassified as liabilities at 9 January 2005 and 26 June 2005reducing net assets by £1,088,000 at each date. There is no effect on theresult for the period ended 8 January 2006 or the net assets on that date. 2. The consolidated financial statements include the financialstatements of the Company and its subsidiary undertakings made up to 8 January2006. The results of all subsidiary undertakings are consolidated. Intra-group salesare fully eliminated on consolidation. 3. Pre-opening costs Property rentals and related costs together with promotional and training costsincurred up to the date of the opening of a new or refurbished restaurant arewritten off to the profit and loss account in the year in which they areincurred. 4. Other operating income All other operating income represents franchise fees received net of allassociated costs and charges. 5. Discontinued operations On the 28 January 2006 the Company sold its bakery, Barons Patisserie, andclosed its outside catering business, Capital Cuisine. 6. (Loss)/earnings per share The (loss)/earnings per share is calculated by reference to the profit or lossafter taxation and the weighted average number of ordinary shares in issueduring the period of 22,273,599 (2005 restated: 19,726,073). The (loss)/earnings per share for both the basic and fully diluted (loss)/earnings per share is calculated on the basis of a loss for the period of£159,000 (2005 profit: £313,000). The diluted (loss)/earnings per share is calculated by reference to the profitor loss after taxation and the weighted average number of ordinary shares andshare options in issue during the period of 22,412,341 (2005 restated:19,926,402). Share options, warrants and the conversion of preference shares notincluded in the diluted calculations as per the requirements of FRS14 (as theyare anti-dilutive) totalled 687,633 (2005 restated: 886,084). 7. No dividend is proposed. 8. Acquisition of BDR Holdings Limited On the 12 December 2005 the Company acquired the entire share capital of BDRHoldings Limited and its subsidiary BDR Restaurants Limited. The fair value ofthe consideration given for the share capital was: Book value before Fair value adjustments Fair value at date acquisition of acquisition £'000 £'000 £'000Tangible fixed assets 2,066 1,134 3,200Stock 34 - 34Debtors 16 - 16Cash and overdrafts (50) - (50)Liabilities (385) - (385)Bank loans (750) - (750)Net assets 931 1,134 2,065Goodwill 759 2,824Satisfied by:Cash 2,716Acquisition costs 108Fair value of consideration 2,824 9. Reconciliation of movement in share premium account Share premium account £'000At 26 June 2005 11,815New share capital subscribed 4,622Transaction costs (269)Reduction in share premium* (7,411)At 8 January 2006 8,757 \* The reduction in the share premium account was confirmed by an Order of theHigh Court of Justice, Chancery Division on the 18 January 2006 and registeredpursuant to section 138 of the Companies Act 1985 on the 20 January 2006. 10.Reconciliation of operating profit/(loss) to operating cash flows 28 week 28 week 52 week period period period ended ended ended 8 January 2006 9 January 26 June 2005 2005 £'000 £'000 £'000Operating (loss)/profit (46) 337 421Depreciation charge 214 184 359Amortisation charge 43 44 80Decrease/(increase) in stocks 11 (36) (40)Decrease in debtors 17 302 169Decrease in creditors (610) (546) (639)Net cash inflow from operatingactivities (371) 285 350 11.Copies of the interim statement are being sent to shareholders andare also available from the company's registered office at 165 Queen VictoriaStreet, London, EC4V 4DD. This information is provided by RNS The company news service from the London Stock Exchange