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(RNS)
2009-10-13 07:02
Booker Group PLC - Interim Results |
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RNS Number : 6237A Booker Group PLC 13 October 2009 13 October 2009 Booker Group plc Interim results of Booker Group plc for the 24 weeks ended 11 September 2009 This announcement contains the interim results of Booker Group plc ('Booker') for the 24 weeks ended 11 September 2009. Financial Highlights
Operating Highlights
Outlook Group turnover in the first period of the second half is ahead of the same period last year. Working capital levels and costs are in line with plan. Overall, Booker continues to trade in line with management expectations. Commenting on the results, Charles Wilson, Chief Executive of Booker, said, "Booker is helping more independent caterers and retailers compete in a difficult economic environment. Through better choice, price and service we have grown sales by £115.7m in the first half. Plans to 'Broaden' the business are progressing well. Our internet sales increased to £180.8m (£96.4m last year), we have become a major force in the delivered wholesale market and our branch in India is now open." Booker Group plc will announce its Quarter 3 Interim Management Statement for the 16 weeks to 1 January 2010 on 14 January 2010. For further information contact: Tulchan Communications (PR Adviser to Booker Group plc) 020 7353 4200 Susanna Voyle Lucy Legh Investec Bank plc 020 7597 5970 Keith Anderson A presentation for analysts will be held at 08.30am on Tuesday 13 October 2009 at Investec's offices. For further details please call Lucy Legh at Tulchan Communications on 0207 353 4200.
Chairman's Statement I am pleased to report on a good performance for the half year to 11 September 2009. Financial Results Sales for the 24 week period were £1.6 billion, an increase of 7.7%. Half year profit before tax was £29.7 million (2008: £26.5 million), up 12.1%. Basic earnings per share increased by 12.2% to 1.66 pence (2008: 1.48 pence). Net debt reduced by £24.9m to £4.0 million (2008: £28.9 million). This has been achieved through a combination of strong operating cash flow and the efficient management of working capital. We also completed the move from AIM to the Official List of the London Stock Exchange on 1 July 2009. Booker is continuing to 'drive' sales by offering 'choice up, prices down and better service'. Non-tobacco sales showed an increase of 9.4%. The drive into the catering market is working with sales to caterers having increased by +12.6% to £528m (2008: £469m). Sales to retailers have increased by +5.5% to £1,085m (2008: £1,028m). Premier, our retail symbol group, continued to grow and now has 2,392 outlets (2008: 2,195 outlets). Our prices have remained competitive and stock availability has been good. As a result, customer satisfaction for choice, price and service has further improved which has generated £115.7m of additional sales in the first half. The plans to 'broaden' the business are going well. We converted a further 10 branches to the 'Extra' format since we last reported. We now have 81 'Extras', which offer a broader range and better environment for customers, and plan to convert an additional 14 in the second half. 'Extra' branches recorded a sales uplift on the prior year of 3% more than non-converted branches, achieving payback of conversion costs in about a year. Booker.co.uk is performing well with internet sales in the half at £180.8m, up 88% versus last year. Booker Direct has become a leading force in the delivered wholesale market. We are proud to now be the UK's largest supplier to the cinema sector. We have also won national and regional accounts in the retail, catering and public service sectors. Dividend Booker's strategy to drive and broaden its business is working. In a challenging environment we continue to make good progress. As a result the Board has declared an interim dividend of 0.24 pence per share (2008: 0.2 pence) to be paid on 27 November 2009 to shareholders on the register at the close of business on 30 October 2009. The ex-dividend date will be 28 October 2009. Outlook Group turnover in the first period of the second half is ahead of the same period last year. Inventory levels and costs are in line with plan. Overall, Booker Group plc continues to trade in line with management expectations. Richard Rose Chairman
Any forward looking statements made throughout this document represent management's best judgement as to what may occur in the future. However, the group's actual results for the current and future fiscal periods and corporate developments will depend on a number of economic, competitive and other factors, some of which will be outside the control of the group. Such factors could cause the group's actual results for future periods to differ materially from those expressed in any forward looking statements made in this document.
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the period
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EQUITY
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equity holders
24 weeks ended 11 September 2009
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24 weeks ended 12 September 2008
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1. General information Reporting entity Booker Group plc (the "Company") is a public limited company incorporated in the United Kingdom under the Companies Act 1985 (Registration number 05145685). The Company's ordinary shares are traded on the London Stock Exchange. The condensed consolidated interim financial statements of the Company as at and for the 24 weeks ended 11 September 2009 comprise the Company and its subsidiaries (together referred to as the "Group"). The financial statements are presented in Sterling and rounded to the nearest hundred thousand. The comparative figures for the period ended 27 March 2009 are not the statutory accounts for that financial year. Those accounts were prepared in accordance with IFRSs as adopted by the EU, have been reported on by the auditors and delivered to the Registrar of Companies. Copies are available upon request from the Company's registered office at Equity House, Irthlingborough Road, Wellingborough, Northamptonshire, NN8 1LT or from the website www.booker.co.uk. The report of the auditors was unqualified and did not contain statements under section 237(2) or (3) of the Companies Act 1985. Statement of compliance These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting'. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group as at and for the period ended 27 March 2009. These condensed consolidated interim financial statements were approved by the Board of Directors on 12 October 2009. Basis of preparation As required by the Disclosure and Transparency Rules of the Financial Services Authority, the condensed set of accounts has been prepared applying the accounting policies and presentation that were applied in the preparation of the company's published consolidated accounts for the period ended 27 March 2009 other than as noted below and except for the Group's tax measurement basis (see note 4). IFRIC 14 "IAS 19 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction" was adopted during the period. Adoption of this interpretation has no impact on the Group's reported results or financial position. IAS 1 "Presentation of Financial Statements" (revised September 2007) was adopted during the period. This results in a number of terminology changes and changes in presentation and disclosure, including presenting a consolidated statement of comprehensive income to replace the consolidated statement of recognised income and expense, and the inclusion of a consolidated statement of changes in equity. IFRS 8 "Operating Segments" was adopted during the period. The standard requires that the segments should be reported on the same basis as the internal reporting information that is provided to the chief operating decision maker. The chief operating decision maker has been identified as the CEO. Internal reports are reviewed regularly by the CEO, but these focus on the operations of the Group as a whole and do not identify individual operating segments. Whilst turnover is reported by customer and product type, there is no discrete reporting showing total profitability or balance sheets. Products flow through the same distribution channels and there are a large amount of expenses and assets/ (liabilities) that are not specific. None of these possible segments have a unique management structure responsible for getting the product from the supplier to the customer. This set of condensed financial statements is therefore presented as a single reportable segment. The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. The significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the period ended 27 March 2009 apart from an updated pension valuation as disclosed in note 7. Going concern The Directors are of the opinion that the Group's forecasts and projections show that the Group should be able to operate within its banking facilities and comply with its banking covenants. The Group is however exposed to a number of significant risks and uncertainties, which could affect the Group's ability to meet management's forecasts and projections, and hence its ability to meet its banking covenants. The directors believe that the Group has the flexibility to react to changing market conditions and is adequately placed to manage its business risks successfully despite the uncertain economic outlook and challenging macro economic conditions. After making enquiries, the Directors have formed a judgement that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, the going concern basis has been adopted in preparing the interim financial information. Operating segments The Group has one operating segment being wholesaling and associated activities (see Basis of preparation above). Seasonality The Group's operations are mainly unaffected by seasonal factors. In 2008/09, the 24 weeks to 12 September 2008 accounted for 47.1% of the annual turnover (2007/08: 47.6%). It should be noted that, in line with internal management reporting, the first half consists of 24 weeks whilst the second half consist of 28 weeks. 2. Administrative expenses Included within Administrative expenses are property related profits of £nil (2008: £1.1m). These profits arose from the sale of land, a premium received on exit of a lease and proceeds received from the grant of an option to assign a lease.
Finance income
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liabilities
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similar income
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4. Tax Tax on the profit before taxation for the 24 weeks ended 11 September 2009 is based on an effective rate of 17.0%, which has been calculated by reference to the projected charge for the full financial year. The rate for the 24 weeks ended 12 September 2008 and 52 weeks ended 27 March 2009 was 17.0% and 16.9% respectively.
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6. Dividends
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After the balance sheet date the Directors declared an interim dividend of 0.24p per share (£3.6m in total) payable on 27 November 2009 to equity holders on the register at the close of business on 30 October 2009. This dividend has not been provided for and therefore there is no difference between the dividends charged to reserves and dividends paid in the period.
liabilities ---------- ---------- ----------
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The assumptions adopted for the valuation at 11 September 2009 are the same as those adopted at 27 March 2009, other than changes to the discount rate (to 6.8% to 5.7%) and inflation (2.75% to 3.0%).
loans and borrowings
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9. Interest swap On 12 June 2009, to reflect the lower level of debt carried by the Group, the Group amended the terms of the interest rate swap. The option caps, the floor and the extension option were removed and the amount of interest rate swap was reduced from £130m to £50m. The interest rate swap remains at 4.98 per cent. £10m of the interest rate swap expires in March 2010 with the remaining £40m expiring in March 2011. The Group spent £7.2m in settlement of this liability, which is shown separately in the consolidated cash flow statement. 10. Related party transactions The Group has a related party relationship with its subsidiaries and with its directors. Transactions between group companies, which are related parties, have been eliminated on consolidation and are not disclosed in this note. There have been no material related party transactions with directors. Responsibility statement of the directors in respect of the half-yearly financial report We confirm that to the best of our knowledge:
By order of the Board
12 October 2009
The Group's business may be affected by a number of risks, trends, factors and uncertainties, not all of which are in our control. The specific principal risks, trends, factors and uncertainties (which could impact the Group's revenues, profits and reputation), and relevant mitigating factors as currently identified by Booker's risk management process which were faced at the time of the last annual report have not changed since the year end and are expected to remain for the following six months. Those risks and uncertainties can be summarised as follows: a) Risks relating to the industry Tobacco regulation Alcohol regulation Environmental legislation UK and European regulations The Group's performance could be adversely affected by poor economic conditions Trade insurers Decline in the number of independent retailers and licensed premises Changes in duty and VAT Health concerns and pandemics b) Risks relating to a competitive market Increased competition from the grocery multiples Growth of large UK food multiples and discounters Pricing and promotional activities by competitors Threat of new entrants c) Risks relating to the Group and its business Dependence on key customers Dependence on relations with third party suppliers Management controls and reporting procedures Consumer trends IT systems errors, internet reliance and malfunctions Dependence on key executives and personnel Mergers and acquisitions Future prospects and the need to raise capital in the future Financing costs and interest rate hedging The Group may be subject to increases in operating and other expenses Foreign exchange Pensions Litigation The Group is exposed to the risk of bank counterparty default Product liability claims Any events that negatively impact the reputation of, or value associated with, the Group's brands could adversely affect the Group's business Property lease liabilities A detailed explanation of each of these risks and uncertainties are shown on pages 8 to 15 of the Prospectus in relation to the Company's admission to listing on the Official List and to trading on the London Stock Exchange plc's main market for listed securities. The Prospectus is published online on our corporate website www.bookergroup.com. The process the Group has in place for identifying, assessing and managing risks also has not changed since the year end. Detailed explanations of this process can be found in the Annual Report and Accounts 2009 on page 15. Independent auditors' report on review of condensed consolidated interim financial information to Booker Group plc Introduction We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the 24 weeks ended 11 September 2009 which comprises the condensed consolidated income statement, condensed consolidated statement of comprehensive income, condensed consolidated balance sheet, condensed statement of changes in equity and the condensed consolidated cash flow statement and the related explanatory notes. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. This report is made solely to the company in accordance with the terms of our engagement to assist the company in meeting the requirements of the Disclosure and Transparency Rules ("the DTR") of the UK's Financial Services Authority ("the UK FSA"). Our review has been undertaken so that we might state to the company those matters we are required to state to it in this report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company for our review work, for this report, or for the conclusions we have reached. Directors' responsibilities The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the DTR of the UK FSA. As disclosed in note 1, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU. Our responsibility Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review. Scope of Review We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity issued by the Auditing Practices Board for use in the UK. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the 24 weeks ended 11 September 2009 is not prepared, in all material respects, in accordance with IAS 34 as adopted by the EU and the DTR of the UK FSA. Jonathan Hurst For and on behalf of KPMG Audit Plc Chartered Accountants St James Square Manchester
M2 6DS 12 October 2009 This information is provided by RNS The company news service from the London Stock Exchange END
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