(RIC) Richoux

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.

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:

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

Richoux Group plc

Condensed consolidated statement of changes in equity

For the 28 week period ended 10 July 2011

Richoux Group plc

Condensed consolidated statement of financial position

at 10 July 2011

Richoux Group plc

Condensed consolidated statement of cash flows

for the 28 week period ended 10 July 2011

 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

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:

5.   No dividend is proposed.

6.   Property, plant and equipment

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

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

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.