(JLH) John Lewis Of Hungerford

JOHN LEWIS OF HUNGERFORD PLC

FINAL RESULTS - YEAR ENDED 31 AUGUST 2011

John Lewis of Hungerford plc ("John Lewis of Hungerford" or the "Company") the specialist kitchen manufacturer and retailer today announces its final results for the year ended 31 August 2011.

CHAIRMAN'S STATEMENT

In my last interim statement I reported on the positive momentum building within the business and I am pleased to report that this was maintained  in the second  half year.  Our  strategy of complementing organic growth with selective investment in new stores contributed to a strong sales performance and we have been able to reinvest the resultant profits back into the business as we face into an increasingly uncertain economic outlook.

A highlight during the period was the performance of our two new stores, Beaconsfield and Blackheath, both of which exceeded our expectations and ended the year  ahead of budget.  The performance of these stores validates the careful approach we adopt in appraising new opportunities and, in light of this, the Board decided to continue our growth strategy through opening a new store in  Cirencester on 1 October 2011.  This brings our  number of stores to 13.  The recent openings  have enabled  us to refine our 'roll out' model such that we are able to quickly capitalise on new opportunities and move from appraisal to store opening in a quick and cost effective manner. New store openings have an important role in delivering our strategic objective to increase utilisation of our manufacturing facility.  However, whilst  we continue to consider  new opportunities no additional store openings are currently planned.

Other key developments in the period included the purchase of the freehold of our  Hungerford store for  £150,000, funded through  a new facility from our bankers, Barclays. Although  this will not have a significant impact on annual operating costs, the acquisition enabled us to secure continued tenancy, on favourable terms, at one of our flagship stores.

Financial performance

The profit before taxation, share based payments and interest was £219,000 compared to a profit of £8,000 in 2010. This was driven  by a strong sales performance, which increased by 16% to £6,224,000 (2010-£5,355,000). This includes the contribution from new store openings, of which one opened at the end of the previous year and one during the year under review.  Excluding the impact of these, the like-for-like sales growth in the year was 0.1%.  The overall gross profit margin of the business was consistent at 53.6% compared to 53.0% in 2010.

The charge in respect of share based payments for the year amounted to £55,000 (2010-£154,000).  Your Board continues to believe the arbitrary nature of this accounting methodology means that this resulting charge has little meaningful relevance to the reported financial results.

In consultation with our auditors we have changed our accounting policy this year relating to showroom display units and appliances.  Such items are now capitalised as fixed assets, which has had the impact of reducing operating profits by the depreciation charge of £25,000 compared to the previous policy of treating them as stock.  Last years results have been similarly restated, which  has reduced previously reported operating profits by £23,000.  The Board believe the new policy represents a prudent approach to accounting for the items.

Net cash inflow  from operating activities was £355,000 (2010-£131,000 inflow) and at the balance sheet date, cash at bank stood at £809,000 (2010-£818,000).

Capital expenditure in the period was £501,000 (2010-£436,000) principally comprising the acquisition of the Hungerford freehold, installation of a new mezzanine  floor in the Wantage factory, the development of  the Beaconsfield store and general improvements to  the store estate.

Current trading

The current year started strongly with year-on-year sales growth during the first quarter. However, the length of our sales cycle means this performance was driven by customer purchasing decisions taken a number of months ago. Consequently, it is not necessarily reflective of current sentiment and we are undoubtedly seeing signs of a further erosion in customer confidence, which translates into a weaker forward order book.  It is too early to determine whether this is a temporary reduction but we are closely monitoring the situation and are ready  to take decisive action should  it become necessary.

Outlook

Your Board is  pleased  with  the progress  the company has made in  recent years, which has been achieved against a difficult economic backdrop. However, the overall economic situation remains very fragile and, like many businesses, we are heavily dependent upon the prevailing level of consumer confidence. Current trading indicates this is continuing to erode and so we must remain vigilant to the threat that this presents.

We are cautious about the prospects for the current year and, in particular, the impact on our business  should the UK  economy re-enter  recession. In light of this we are maintaining tight control over overhead expenditure while recognising the need to continue to invest in the business if we are to deliver  long-term  shareholder  growth.  The winter sale has always been a key trading period for our business but the outturn in  the current year will be equally influenced by the extent to which  delayed or  deferred customer orders return later in the year.  It is  simply too soon to state with any certainty whether this is likely to be the case.

I would again like to pay testament to  the support of our employees  who have been instrumental in delivering the positive developments over the past  few years.  As  the Company moves towards  its 40th anniversary it is their commitment to making quality British made kitchens and furniture that remains at the heart of our business.

Malcolm R. Hepworth

Non Executive Chairman

16 December 2011

Profit and Loss Account for the year ended 31 August 2011

The profit and loss account has been prepared on the basis that all operations are continuing operations.

Balance Sheet as at 31 August 2011

Cash Flow Statement for the year ended 31 August 2011

Notes

1. Statutory Accounts

The financial information does not constitute statutory accounts as defined in section 435 of the Companies Act 2006, but has been extracted from the statutory accounts for the year ended 31 August 2011 on which an unqualified audit report has been issued and which will be delivered to the Registrar following their adoption at the Annual General Meeting.

The statutory accounts for the financial year ended 31 August 2010 have been delivered to the Registrar of Companies with an unqualified audit.

2. Basis of preparation

The Company's statutory accounts have been prepared under the historical cost convention and in accordance with applicable accounting standards.  During the year the Company changed its accounting policy relating to internally manufactured showroom display units.  The effect of this change in accounting policy is to reduce profit after tax by £25,641 (2010: £23,342) and to reduce net assets as at 31 August 2011 by £80,152.

3. Loss per share

Basic and diluted

The calculation of profit/(loss) per share is based on a profit of £151,265 (2010: £(166,214) as restated) and a weighted average number of ordinary shares in issue of 186,745,519 ordinary shares (2010: 186,745,519).

4. Dividends

The Directors do not recommend payment of a dividend.

5. Posting of Accounts

Copies of the statutory accounts for the financial year ended 31 August 2011 will be posted shortly to shareholders with the notice of the Annual General Meeting.  An electronic copy will be available, at the same time, on the Company's web site www.john-lewis.co.uk.

6. Annual General Meeting

The next Annual General Meeting of the Company will take place at the Company's offices at Grove Technology Park, Downsview Road, Wantage, Oxon, OX12 9FA at 4.00 pm on Monday 23 January 2012.

JOHN LEWIS OF HUNGERFORD PLC

("John Lewis of Hungerford" or the "Company")

Interim results - period ended 28 February 2011

CHAIRMAN'S STATEMENT

In the face of the continued challenging economic conditions I am pleased to be able to report that the business has built on the  positive  momentum of the last full financial year. Like for like sales are some 9% ahead of last year, which combined with the impact of new stores openings have contributed to the overall 18% growth in sales. Operating loss before the impact of share based payments has further narrowed and with a strong order book, the Board considers the business well positioned to build on the first half year. Nevertheless the current economic climate requires caution to be exercised and your Board remain alert to the risk presented by continuing weak consumer confidence.

As  previously reported, a key highlight during the period was the opening of our new showroom during November 2010 in Beaconsfield, Buckinghamshire. We are pleased with the showrooms initial trading and also trading at our Blackheath store which opened in August 2010. This validates the Board's strategy of seeking to complement organic growth through selective investment in new stores. Wider problems in the retail sector inevitably presents opportunities for further store openings, although your Board will continue to adopt a cautious approach taking into account the general economic conditions and the financial performance of the existing business.

The overall gross profit margin of the business in the 6 months to 28th February 2011 was 52.7% compared to 52.3% in 2010. This increase in gross margin is a result of increased  efficiencies  in production and reduced overtime costs. The Normalised Loss before taxation, share based payments and interest was £62k (2010 - £153k). The charge in respect of share based payments for the period amounted to  £53k (2010 - £81k) although your Board continues to  believe the arbitrary nature of the accounting methodology in arriving at this charge means it has little meaningful relevance to the reported financial results. The reduced loss was driven by both an increase in our core product sales which  increased  by 12.6%  to  £2,376k (2010: £2,110k)  and  The  Artisan  Installation Service  which has significantly increased sales of £341k (2010: £188k), giving total sales of £2,717k (2010: £2,298k).

Net cash inflow for the half year was £107k (2010: £330k  outflow) and at the balance sheet date, cash in bank stood at £925k (2010: £454k). This increase reflects the higher value of forward orders for the year compared with last year. Capital expenditure in the period was £104k (2010 - £79k) reflecting investments made in one new showroom and the factory.

Our sales and future order book look healthy with customer interest in our brand remaining strong and this is reflected in our advance order book which as of 28th February 2011 is some 20% ahead of last year. This reflects both the growth in our business and investment made in strengthening the customer facing teams  in some  of our  showrooms.  However, we are operating in difficult, if not unprecedented, economic times and so it is very difficult to predict the future with any degree of certainty. In particular the Board is vigilant of margin pressures through increases in raw material costs.

Nevertheless your Board continues to believe the strength of the John Lewis of Hungerford brand coupled with the expanded product range at reasonable prices means the business is well positioned to face the future with confidence.

Malcolm Hepworth

Chairman

26 April 2011

PROFIT AND LOSS ACCOUNT

FOR THE SIX MONTHS ENDED 28 FEBRUARY 2011

BALANCE SHEET

AS AT 28 FEBRUARY 2011

CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 28 FEBRUARY 2011

NOTES:

1.   The interim accounts, which are unaudited, have been prepared under the historical cost convention using the accounting policies set out in the accounts for the year ended 31 August 2010.

2.   Basic and fully diluted loss per ordinary share is calculated as follows:

3.   Copies of the 2011 interim accounts will be available toshareholders on the Company's website www.john-lewis.co.uk