Naked Wine Regulatory News (WINE)

14 Nov 2005 07:02

Majestic Wine PLC14 November 2005 IMMEDIATE RELEASE 14 November 2005 Majestic Wine PLC INTERIM RESULTS Majestic Wine PLC ("Majestic"), the UK's largest wine warehouse chain with 124stores, today announces its interim results for the 26 weeks ended 26 September2005. Highlights * Profit before tax, amortisation and excluding exceptional items, increased by 18.0% to £5.9m (2004: £5.0m). * Total sales of £80.8m (2004: £74.6m). Like for like UK sales up 5.5%. * Interim dividend increased by 26.7% to 1.9p net per share (2004: 1.5p) * 43% increase in sales of fine wines priced at £20 and above. Three new fine wine display areas installed (Richmond, Weybridge and Belgravia). * Average bottle price of still wine purchased at Majestic is now £5.54 (2004: £5.46). Average spend per transaction has risen to £115 (2004: £110). * Two new stores opened during the period (Sanderstead and Tunbridge Wells). Derby opened early November and Berkhamsted opening by Christmas. * Helen Keays has joined the Board as non-executive Director. She has wide marketing experience in several consumer sectors. Commenting on current trading Tim How, Chief Executive of Majestic said: "Sales growth has continued to be robust in a challenging retail market. Likefor like UK sales for the six weeks from 27 September to 7 November 2005 were up5.0%." For further information, please contact: Tim HowNigel AlldrittMajestic Wine PLC Tel: 01923 298200 Tim Thompson / Nicola Cronk Tel: 020 7466 5000Buchanan Communications High resolution images are available for the media to view and download free ofcharge from www.vismedia.co.uk" Chairman's Statement I am very pleased to announce a further increase in profit for the first half ofthe 2005/2006 financial year. Profit before tax, amortisation of goodwill, andexcluding exceptional items, rose 18.0% to £5.9m. Total sales were £80.8m against £74.6m last year. Like for like UK sales were up5.5%. The average bottle price of still wine purchased at Majestic is now £5.54compared with £5.46 last year and the average spend per transaction is now £115,up from £110 last year. We saw strong sales growth in wines from Spain, California, Chile, Argentina andNew Zealand. Champagne and rose wine sales grew well and during August webrought in a parcel of mature Burgundy, which also sold well. Sales of fine winegenerally continue to show good growth, with sales of wines priced at £20 andabove increasing by 43% on last year. We have recently installed new fine winedisplay areas in our stores in Richmond, Weybridge and Belgravia. During the period we introduced several new shorter promotions supported by morefrequent customer communication. These were successful and will be repeated inthe future. New Stores During the period we opened two new stores in Sanderstead and Tunbridge Wells.Derby opened in early November and by Christmas we will have opened inBerkhamsted. This will bring the number of stores trading in the UK to 125.Tunbridge Wells, Derby and Berkhamsted are all freehold acquisitions. Inaddition we have two freeholds in Cheam and Stow-on-the-Wold due to open in 2006and now own 29 freeholds. Wine and Beer World The cross-channel market has been difficult with the number of UK shoppersvisiting the French channel ports continuing to decline. Sales in our stores inNorthern France have been disappointing, with a like for like decline of 4.3%.Pre-ordering before travelling for collection from our stores is increasinglypopular and represented just over 25% of sales during the period. Dividend We are declaring an increased interim dividend of 1.9p net per share, up by26.7% on last year, in line with our progressive dividend policy. The dividendwill be paid on 6 January 2006 to shareholders on the register at the close ofbusiness on 2 December 2005. Board Appointment We are pleased to welcome Helen Keays to the Board as non-executive Director. Helen is 41 and is a marketing professional with wide experience of severalconsumer sectors, including travel, retail, financial services and telecoms. Sheis a non-executive director of Chrysalis Group PLC and of the Britannia BuildingSociety. Current Trading Sales growth has continued to be robust in a challenging retail market. Like forlike UK sales for the six weeks from 27 September to 7 November 2005 were up5.0%. Simon BurkeChairman14 November 2005 GROUP PROFIT & LOSS ACCOUNT For the 26 weeks ended 26 September 2005 26 weeks 26 weeks Year ended ended ended 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) Note £'000 £'000 £'000 Turnover 80,766 74,642 162,517Cost of sales (64,124) (59,369) (128,436) Gross profit 16,642 15,273 34,081Distribution costs (6,876) (6,473) (13,103)Administrative costs (4,297) (4,215) (8,760)Other operating income 264 216 440 Operating profit 5,733 4,801 12,658Profit on disposal of fixed assets 2 37 - 88 Profit on ordinaryactivities 5,770 4,801 12,746before interest andtaxationNet interest (payable)/ (3) 28 144receivable Profit on ordinaryactivities 5,767 4,829 12,890before taxationTaxation 3 (1,953) (1,630) (4,347) Retained profit for the period 3,814 3,199 8,543 Dividend paid in period 4 2,554 1,892 2,846 Earnings per share 6Basic 6.0p 5.1p 13.6pDiluted 5.8p 4.9p 13.2p Underlying earnings pershareBasic 6.2p 5.4p 14.0pDiluted 6.1p 5.2p 13.6p GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSESFor the 26 weeks ended 26 September 2005 26 weeks 26 weeks Year ended ended ended 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Profit attributable tothe members of the parent company 3,814 3,199 8,543Currency translationdifferences on foreign currency netinvestments (30) 40 71Total gains and losses recognised 3,784 3,239 8,614 GROUP BALANCE SHEETAs at 26 September 2005 As at As at As at 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) Note £'000 £'000 £'000 Fixed assetsIntangible fixed assets 5,950 6,320 6,135Tangible fixed assets 34,388 26,138 29,347 40,338 32,458 35,482 Current assetsStocks 30,192 27,044 27,798Debtors 6,401 5,399 6,199Cash at bank and in hand 1,238 5,040 7,840 37,831 37,483 41,837Creditors:Amounts falling due within one year (36,538) (35,065) (37,686)Net current assets 1,293 2,418 4,151 Total assets less currentliabilities 41,631 34,876 39,633Creditors:Provision for liabilitiesand charges (293) (469) (297)Net assets 41,338 34,407 39,336 Capital and reservesCalled up share capital 5 4,839 4,748 4,776Share premium account 5 7,961 6,534 6,750Revaluation reserve 5 22 22 22Capital reserve - own shares 5 (391) (407) (407)Profit and loss account 5 28,907 23,510 28,195 Equity shareholders' funds 5 41,338 34,407 39,336 GROUP CASH FLOW STATEMENTFor the 26 weeks ended 26 September 2005 26 weeks 26 weeks Year ended ended ended 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Net cash inflow from operatingactivities 3,632 7,117 16,896Returns on investments and servicingof financeInterest paid (21) (7) (12)Interest received 45 36 145 24 29 133 TaxationUK corporation tax paid (1,897) (1,654) (3,416)Overseas corporation tax paid (377) (585) (927) (2,274) (2,239) (4,343) Capital expenditurePayments to acquire tangible fixedassets (6,334) (2,855) (7,709)Receipts from sales of tangiblefixed assets 185 209 764Net cash outflow from capitalexpenditure (6,149) (2,646) (6,945) Equity dividends paid (2,554) (1,892) (2,846)Net cash (outflow)/inflow beforefinancing (7,321) 369 2,895 FinancingIssue of Ordinary Share capital 575 272 516Receipt for exercise of shareoptions satisfied by QUEST 174 - 9(Decrease)/increase in cash for theperiod (6,572) 641 3,420 NOTES TO THE GROUP CASH FLOW STATEMENTFor the 26 weeks ended 26 September 2005 (a) Reconciliation of operating profit to net cash inflow from operatingactivities 26 weeks 26 weeks Year ended ended ended 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Operating profit 5,733 4,801 12,658 Depreciation charges 1,155 1,059 2,183Amortisation charge 185 185 370(Profit)/loss on disposal oftangible fixed assets (10) (6) 58Increase in stocks (2,394) (3,467) (4,221)(Increase)/decrease in debtors (202) 659 (231)(Decrease)/increase in creditors (854) 3,692 5,810(Decrease)/increase in provisions (4) 127 (45)Deferred bonus payable by shares 23 67 314Net cash inflow from operatingactivities 3,632 7,117 16,896 (b) Reconciliation of net cashflowto net funds/(debt) 26 weeks 26 weeks Year ended ended ended 26.09.05 27.09.04 28.03.05 (unaudited) (unaudited) (audited) £'000 £'000 £'000 (Decrease)/increase in cash (6,572) 641 3,420Exchange differences (30) 23 44Movement in net funds (6,602) 664 3,464Net funds at 28 March 2005 7,840 4,376 4,376Net funds at 26 September 2005 1,238 5,040 7,840 NOTES TO THE INTERIM REPORT 1. BASIS OF PREPARATION The accounts of the Group for the 26 weeks ended 26 September 2005, which areunaudited, were approved by the Board on 14 November 2005. They have beenprepared in accordance with the accounting policies set out in the Annual Reportand Accounts 2005 except that during the period the company adopted FRS 21,Events After the Balance Sheet Date. Under FRS 21 interim dividends are nolonger accrued and final dividends are accrued once they are approved at theAGM. As a result retained earnings are higher by £1,230,000 in this period(2004: £946,000). The results contained in this statement do not constitute statutory accounts asdefined in Section 240 of the Companies Act 1985. The financial information forthe full preceding year is based on the statutory accounts for the year ended 28March 2005. Those accounts, upon which the auditors, Ernst & Young LLP, issuedan unqualified opinion, have been delivered to the Registrar of Companies. 2. PROFIT ON DISPOSAL OF FIXED ASSETS During the period a residential flat above the freehold property in Roehamptonwas sold for £157,000 realising an exceptional gain of £37,000. During theprevious year, five residential flats above freehold properties in Roehamptonand Wilmslow were sold for £738,000 realising an exceptional gain of £88,000. 3. TAXATION Taxation for the 26 weeks ended 26 September 2005 is provided at 33.9% on profiton ordinary activities being the anticipated rate of taxation for the period. 4. DIVIDEND A dividend of 4.0p net per share was paid to shareholders on 5 August 2005. Aninterim dividend of 1.9p net per share will be paid on 6 January 2006 toshareholders on the register at the close of business on the 2 December 2005. 5. RECONCILIATION OF MOVEMENTS IN RESERVES AND SHAREHOLDERS' FUNDS Share Share Revaluation Capital Profit & Total Capital Premium Reserve Reserve Loss Shareholders' £'000 £'000 £'000 -own Account Funds shares £'000 £'000 held in ESOT £'000At 28 March 2005 4,776 6,750 22 (407) 28,195 39,336Share issue 43 532 - - - 575ESOT share issue 7 225 - (116) (116) -QUEST share issue 13 454 - - (467) -Options satisfied fromQUEST - - - - 174 174Retained profit for the period - - - - 3,814 3,814Transfer toshareholdersfunds -deferred bonusexpected to besatisfied inshares - - - - 23 23Dividend paidin period - - - - (2,554) (2,554)Shares vestingunder deferredbonus scheme - - - 132 (132) -Currencytranslationdifferences onforeigncurrency netinvestments - - - - (30) (30)At 26September 2005 4,839 7,961 22 (391) 28,907 41,338 6. EARNINGS PER SHARE Basic earnings per share is calculated on profit on ordinary activities aftertax of £3,814,000 (2004: £3,199,000) apportioned over the weighted OrdinaryShares that were in issue for the period: 63,657,591 (2004: 62,659,997). Thecalculation of the diluted earnings per share is in accordance with FRS 22. Theweighted average number of Ordinary Shares in issue during the period has beenadjusted to take account of the effect of all dilutive potential OrdinaryShares. The number of shares used in the calculation was 65,399,352 (2004:64,724,441). Underlying earnings per share is calculated on earnings, before chargingamortisation of goodwill arising on the acquisition of Les Celliers de CalaisS.A.S. and excluding the exceptional gain made on the disposal of residentialflats, of £3,962,000 (2004: £3,384,000). This alternative measure has beencalculated to allow shareholders to gain a clearer understanding of the tradingperformance of the Group. 7. INTERIM REPORT Copies of the Interim Report are being sent to shareholders. Further copies ofthe Interim and Annual Report and Accounts may be obtained from the Company'sRegistered Office, Majestic House, Otterspool Way, Watford, Hertfordshire, WD258WW. The Interim Report should be read in conjunction with the Annual Report andAccounts 2005. This information is provided by RNS The company news service from the London Stock Exchange