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| 22-10-09 | RNS |
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RNS Number : 2273B Sceptre Leisure PLC 22 October 2009 Sceptre Leisure plc ("Sceptre" or the "Company" or "the Group") Result of AGM At the Annual General Meeting of Sceptre Leisure plc held earlier today, all resolutions put to the meeting were duly passed. 22 October 2009 Enquiries:
Sarah Jacobs / Richard Feigen /
Christopher Wren
Matthew Smallwood /Jamie Ramsay This information is provided by RNS The company news service from the London Stock Exchange END
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| 22-10-09 | RNS |
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RNS Number : 1926B Sceptre Leisure PLC 22 October 2009 Sceptre Leisure plc ("Sceptre" or the "Company" or "the Group") AGM statement At the Annual General Meeting of Sceptre Leisure plc to be held later today, the Chairman Douglas Yates will make the following comments on current trading:
"Sceptre continues to see the benefit of its merger with Gamingking which has allowed cross -marketing of Sceptre's products into the social club market and the successful trial and planned roll out of Gamingking's lottery products in pubs. "The Company operates in an evolving, dynamic marketplace where there remains much opportunity. Sceptre is well positioned to take advantage of that opportunity both through organic growth and through selected acquisition. "As mentioned at the time of the release of our figures on 8th October, we are in negotiations with our bankers to renew and increase our overdraft facilities, these discussions are continuing to move forward in a positive manner and the board remains confident of resolving the matter in the near future." 22 October 2009 Enquiries:
Sarah Jacobs / Richard Feigen /
Christopher Wren
Matthew Smallwood / Jamie Ramsay This information is provided by RNS The company news service from the London Stock Exchange END
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| 16-10-09 | RNS |
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RNS Number : 8806A Sceptre Leisure PLC 16 October 2009 Sceptre Leisure plc ("Sceptre" or the "Company" or "the Group") Share Option Grants The Company announces that on 16 October 2009, it granted options to Directors and employees over a total of 1,553,349 Ordinary shares of 5 pence each. The following staff of the Company were granted options as detailed below.
Directors:
Employees:
The options are not subject to the achievement of performance criteria as the Remuneration Committee has deemed these to be a reward for past services in accordance with the rules of the Company's Share Option Plan. Enquiries:
Lesley Humphrys Guy van Zwanenberg Seymour Pierce Limited + 44 (0) 207 107 8000 Sarah Jacobs Christopher Wren
Matthew Smallwood Justine Warren This information is provided by RNS The company news service from the London Stock Exchange END
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| 15-10-09 | RNS |
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RNS Number : 7575A Sceptre Leisure PLC 15 October 2009 Sceptre Leisure Plc ("Sceptre" or "the Company") Provision of Annual Report and Accounts The Company announces that the final report and accounts for the year ended 30 April 2009 has been sent to shareholders today and is available to download from the Company's website at http://www.sceptreleisureplc.co.uk and will be available for 1 month from the Company's offices at 139 Brookfield Place, Walton Summit, Bamber Bridge, Preston PR5 8BF. Enquiries:
Lesley Humphrys
Guy van Zwanenberg
Sarah Jacobs
Christopher Wren
Matthew Smallwood Justine Warren
This information is provided by RNS The company news service from the London Stock Exchange END
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| 08-10-09 | RNS |
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This news article is displayed preformatted as it may contain results tables
RNS Number : 4316A
Sceptre Leisure PLC
08 October 2009
Sceptre Leisure plc
("Sceptre" or the "Company" or "the Group")
Preliminary Results for the year ended 30 April 2009
Significant Progress, opportunities maximised
Sceptre Leisure plc (AIM: SCEL), the AIM-listed leisure and gaming group, today announces its preliminary results for the year ended 30 April 2009.
Highlights
Financial
* Revenue increased 83% to £39.2m (2008: £21.4m)
* EBITDA nearly doubled to £13.0m (2008: £7.2m)
* EPS before exceptional items of 3.6p (2008: 2.4p)
* £5.5m raised to finance gaming machine roll out
* Gearing improved
Operational
* Integration of Gamingking effected smoothly and efficiently
* Excellent continued penetration into the pub market
* Group machine numbers rose 18% to c21,000 at the year end
* Strong growth of our new fixed odds betting terminals product in betting offices with some significant wins
* Asset utilisation continues at very high levels (95.0% up from 93.8% in 2008) and machine week average increased by 23%
* Extension of the Lotteryking product suite is reaping encouraging results, machine numbers extended from 100 to 300 sites for in-pub lottery machines
* Current trading has continued along the positive trends established in H2 of 2009.
Ken Turner, Chief Executive of Sceptre Leisure, commented:
"I am delighted with the progress that has been made, We have further penetrated the pub market with some good wins growing the business by a third over the last year, taking best advantage of our market opportunity. The integration of Lotteryking has gone well and cross marketing the product range is reaping reward.
We have a dynamic business with excellent prospects."
8 October 2009
For further information, please contact:
Sceptre Leisure plc Today: 0207 457 2020
Ken Turner Thereafter: 01772 694242
Seymour Pierce (NOMAD) 0207 107 8000
Sarah Jacobs / Richard Feigen /
Christopher Wren
College Hill 0207 457 2020
Matthew Smallwood / Justine Warren
The Report and Accounts will be sent to shareholders shortly and will be available from the companies registered office and on its website www.sceptreleisureplc.co.uk.
Chairman's Statement
Welcome to Sceptre Leisure plc's first preliminary results in which the Board is pleased to report a strong set of full year figures. Turnover, profit before exceptional items and cash generated from operations are all ahead of the prior year, and continue the progress presented in our interim statement.
Following the reverse takeover in September 2008, the integration of the two businesses was successfully completed and support functions consolidated. In addition, certain rebranding has taken place and a number of new products and initiatives launched.
The Group has achieved some significant contract wins from the competition and this momentum has continued into the new financial year. Despite the beginning of a recession in the UK and continued difficult operating conditions for the pub and club market the Group has continued to grow by increasing market share, and the Board's strategy is to continue this through a combination of organic growth and acquisition.
The banking crisis resulted in the termination of some of our leasing facilities during the year. While this placed an absolute limit on the number of new contracts we could accept, the raising of £5.5m of new equity in June 2009 has enabled the expansion to continue. We have also secured a number of new asset finance lines since the year end, which have been utilised to fund recent capital purchases. The Group is in negotiations with its bankers to renew and increase its overdraft facilities. The Board is confident of resolving this matter in due course.
I am convinced that we have the best executive senior management team in the business and this will continue to be very important to the future of the Group.
Finally, I would like to thank the management and staff of our trading divisions for their commitment and hard work over the past 12 months. Our reputation for customer service and operational innovation is built on their contributions, and I am sure that the Board can rely on their continued support in the months ahead.
Douglas Yates
Chairman
7 October 2009
Chief Executive's Review
It gives me great pleasure to present my first annual review for Sceptre Leisure plc. Since our interim report earlier this year the Group has continued to grow its business in the licensed trade whilst maintaining improvements in our machine revenue and utilisation averages. The businesses acquired in the reverse takeover earlier this year have now been fully integrated, and we are beginning to see the benefits of being able to offer our full range to a wider customer base.
The drive for growth continues into the new financial year; our successful placing of £5.5m in new shares on AIM in June 2009 will provide the financial resources needed to increase penetration in all of our target markets.
Performance overview
The results for the 12 months to the end of April 2009 showed turnover up 83% to £39.2m, with a similar rise in both gross profit and operating profit before exceptionals. Net cash from operating activities also increased to £12.8m from £9.4m in the prior year.
The Group's performance continued to build on the strong start reported in our interim statement; all of the above measures improved in the second six months of the year. We continue to work hard at maximising the revenue achieved from our assets, with our machine utilisation ratio (the percentage of our total machine estate on active hire) continuing to hold at our target rate of 95%. This, coupled to the growth of our average weekly rental income per machine over the period under review, has allowed us to increase profitability despite the challenging environment in which we operate.
The Group won significant new business with high-quality customers during the year, allowing us to increase both machine numbers and average income levels in the face of continued pub closures. Again, this momentum has continued into the new financial year with further contract awards being won by Sceptre Leisure Solutions in the first quarter.
Our three main trading divisions are now fully established within the Group, and continue to work towards our strategic objectives in a co-ordinated manner. I would like to take this opportunity to summarise the main achievements in the year under review.
Sceptre Leisure Solutions
The Directors believe that Sceptre remains the second-largest operator of amusement and gaming machines in the UK's licensed retail sector, and the only national operator with fully staffed depots across the country. During the year we opened a new depot in Cardiff, allowing us to offer an average two-hour service response time across the UK.
During the year, the number of machines operated grew by 19% to 18,000, with average weekly rental also increasing 23% during the period. Whilst pub closures continue to affect the lower end of the market, our experience is that at the top end our customers will continue to do well where their offering includes our market-leading machine portfolio to help them achieve their financial targets. We have continued to grow both the quantity and quality of our machine estate whilst many of our competitors have failed to do so.
Sceptre Gaming (the fixed odds betting terminal (FOBT) sub-division of Sceptre Leisure Solutions) signed a new partnership with Videobet, a subsidiary of the Playtech group, in November 2008. The partnership gave Sceptre Gaming exclusive supply of Videobet's multi-game software in the UK, including revolutionary games and industry-first loyalty features, and will strengthen Sceptre Gaming's position in the UK FOBT market.
Sceptre Gaming experienced strong growth with FOBT machines in licensed betting offices over the year and will continue to roll-out the product across the UK. This partnership with Videobet highlights Sceptre Gaming's strong position in the UK FOBT market and commitment to supplying our customers with the highest quality product available. We aim to achieve a significant share of the estimated 40,000-piece FOBT market in the UK which has traditionally been dominated by two machine and software suppliers. Our FOBTs are currently undergoing trials in a number of national and regional licensed betting office operators' premises, and both players and operators have received the product extremely well.
The Videobet platform offers unique player tracking and customer loyalty functionality, which can be utilised by our LBO customers to increase revenues and introduce cross-platform marketing.
Videobet's software is not confined to the FOBT market, and can easily be adapted for digital category C AWP (Amusement With Prizes) machines for use in pubs and clubs. Sceptre has traditionally operated analogue AWPs in all of its markets, but this partnership will allow us to supply a digital offering for our customers which will complement our existing product range.
We continue to concentrate on Sceptre Leisure's operating ratios, and particularly that between the numbers of machines operated to staff employed. This ratio is analysed monthly, and during the course of the year we continually rebalanced our staffing levels between the depots according to need. This ensures that not only are we employing the right number of people across the business, but that they are employed in the correct part of the country.
Lotteryking
Following the reverse takeover in September 2008, we rebranded and relaunched Lotteryking within the club market in which it operates around 3,000 instant-win lottery machines. We have also introduced a number of new lottery games, some offering a higher level of payout to increase player involvement, and others being based on well-known club fruit machines. Initial sales figures of these new games are encouraging, and they are a valuable aid to gaining new lottery sites.
In addition to this traditional product base, Lotteryking now offers the Group's full range of coin-operated gaming and amusement machines to the registered club market through a strengthened sales team. These efforts should result in increased density and operational benefits as we begin to win market share in the new product groups.
In my interim review, I announced a new trial of around 100 regional brewer-operated sites in the North-West into which we would be installing lottery vending terminals. The trial involved an estate-wide roll-out, with the lotteries being sold supporting a single charity nominated by the pub operator. The model has proved popular with players, sites and charity alike, and we will extend the trial to a further 200 locations in different regions during the course of the new financial year.
Kelly's Eye
Following an extensive rebranding exercise, Kelly's Eye was launched online in the first quarter of 2009. As well as generating sales, the website has proven a valuable tool to communicate the full range of available products to our Group customers in other divisions, and Kelly's Eye products are now being distributed through both Sceptre and Lotteryking sales channels.
The Kelly's Eye product line has expanded to include newly popular indoor games such as poker whilst retaining perennial favourites such as bingo and darts. These activities offer pub operators the opportunity to attract and retain a client base both through themed evenings and team-based competitions, and Sceptre is well-placed to capitalise on the growth of this market in pubs across the UK.
Support division
The support and technical functions of the Group are now fully integrated. Machine service, installation, collection, warehousing and distribution were all fully consolidated two months after the reverse takeover. Administrative, Finance and ICT functions were also centralised at our Preston head office within six months of the transaction date. As I have stated before, however, the value to be derived from the expanded group will come from revenue enhancement rather than cost reduction.
The consolidation of warehouse and production into our Preston head office resulted in the closure of premises previously operated in the North-East and Cardiff, and we successfully sublet or terminated the leases on these two locations in Spring 2009, reducing our cost base in these areas.
The Group's new customer service centre opened at our head office in Spring 2009, allowing our technical team to view and manage service calls in real time across all of our depots. Each service call, which is communicated electronically to our team of 90 field-based engineers, is tracked and monitored to ensure that our target response times are met. This continued investment underlines our commitment to customer service, and will allow us to keep Sceptre's response times to a minimum, ensuring that our assets are earning money for our customers more of the time.
Outlook
Sceptre Leisure plc grew strongly during the year under review, increasing market share by attracting high-quality customers from our competitors. We aim to continue that organic growth during 2009-10, and have made a positive start to the year with further contract awards from Whitbread Leisure for approximately 50% of their nationwide business, and also from regional pub operator Larder Leisure in the North-East of England. These new machines will be installed during the second quarter of the current financial year.
Our FOBT operation continues to expand with a new sole-supply agreement for Scotbet from 1 September, to whom we were previously contracted for 50% of their terminals. Our continued trials with Coral have also now moved into a more advanced six-month extension period.
We have increased the number of pub and club lottery terminals since April, with a 5% uplift in numbers across the country in the last five months.
In summary, in the first few months of the current year trading levels have continued the established trend of year-on-year growth, and we remain in line with our performance expectations.
We will also look to grow through acquisition if suitable targets can be found that complement our existing business. Our recent share placing for £5.5m gives us the ability to follow this dual strategy of organic and acquisitive growth.
The increases in stakes and prizes in June 2009 provided a welcome boost to the AWP market, and Sceptre has benefited from increased rentals on the new and converted machines. Our customers are also now seeing benefit from the roll-out of machines offering increased stake and prizes through increased machine takings.
Our partnership with Videobet and Playtech gives us exclusive access to market-leading technology, and we will work with them to develop our digital offering in the coming months.
We will also continue to increase revenue through the cross-selling of our full product portfolio into our Group-wide customer base of over 10,000 locations.
As we have demonstrated over the past year our business continues to improve operating margins and grow despite the general economic conditions and continued pub closures. We are confident that we can not only maintain, but build on, our strong performance last year in the coming 12 months.
Ken Turner
Chief Executive Officer
7 October 2009
Financial Review
Introduction
I would like to take the opportunity to review some key areas of our financial performance in the year under report.
Revenue
Group turnover increased by 83% to £39.2m, as the benefit of acquisitions materialised along with new major contracts awarded within the year. Rental income increased by 74% to £36.4m with new revenue streams amounting to £2.5m.
Profitability
Operating profit before exceptional items increased by 93% to £3.7m, whilst profit before tax before exceptional items increased by 74% to £1.8m. The machine sales and rental division, representing 94% of the Group revenues increased operating profit by 58% to £4.2m.
Corporate overheads amounted to £0.5m and comprised the costs of the Board, legal, professional and other fees connected with running a public company in the period following the reverse takeover of Gamingking plc.
There was also an employee share-based payment charge recognised in the year of £0.1m (2008: £nil).
Finance costs
The net finance costs charged to income were £1.9m (2008: £0.9m), of which £1.5m was cash interest. The balance related to a non-cash, interest rate swap movement of £0.4m loss (2008: £7,000 gain). This derivative contract was a condition of the Group's banking agreements with HBOS.
Earnings per share
Basic earnings per share before exceptionals at 3.6p (2008: 2.4p) increased by 50%.
Key Performance Indicators
The Board of Sceptre Leisure plc monitors a range of financial and non-financial performance indicators, reported on a periodic basis, to measure performance against expected targets. These include:
Financial 2009 2008
1 Earnings per share before exceptional items 3.6p 2.4p
2 EBITDA £13.0m £7.2m
Non-financial
3 Machine numbers 20,921 15,183
4 Machine week average £38.92 £31.62
5 Pieces/personnel ratio 46 45
6 Asset utilisation 95% 94%
Definitions
1. Earnings per share is calculated in note 8.
2. EBITDA is earnings before interest, income tax expense, depreciation, amortisation, exceptional items (including goodwill
impairment) and share-based payment.
3. Machine numbers is the number of machines operated by the Group.
4. Machine week average is the seven day average gross rent received by the Group per machine operated.
5. Pieces/personnel ratio is the number of machines operated per person employed within Sceptre Leisure Solutions.
6. Asset utilisation is the percentage of machines currently sited.
Capital expenditure
Capital expenditure was £14.8m in 2009. The level of capital expenditure on replacement machines amounted to £8.3m and £5.6m spent on investment capital for new contracts and new products. Consolidation of warehouse, production and head office facilities incurred capital expenditure of £0.2m with remaining £0.7m spent on motor vehicles.
Reverse takeover of Gamingking plc
On 29 September 2008, Gamingking plc bought Orb Holdings Limited in a share-for-share transaction, and subsequently changed its name to Sceptre Leisure plc. Due to the relative values of the two groups, following the transaction Orb's shareholders became the majority shareholders, with 85% of the enlarged share capital, and the substance of the combination was therefore that Orb Holdings Limited acquired Gamingking plc in a reverse takeover.
Note 1 to the financial statements fully explains the transaction. In summary, however, the figures for the year ended 30 April 2009 represent almost five months of Orb Holdings operations, together with a little over seven months of the combined new group. The Group figures used as comparatives represent only Orb Holdings in the prior year.
The acquisition price of Gamingking plc is broken down in note 11. As part of the transaction, the Directors reviewed the acquired group in order to assign a value to intangible assets purchased. The brand names for both Lotteryking and Kelly's Eye, together with their customer relationships within the registered members club market, were valued using a discounted cash flow method as required under IFRS. These intangible assets are being amortised over a 20-year period. The revaluation of the assets also gave rise to a deferred tax liability, which has been recognised as part of the transaction.
Exceptional costs
Following the transaction, the Group incurred certain one-off restructuring costs. These centred on provisions for redundancy and onerous leases for properties which are no longer required. All onerous lease amounts payable have been fully provided for up to the first available term break. These costs are set out in note 4.
Prior year adjustment
Following a review of accounting for accrued income during the year, an under-accrual of cost associated with this income came to light. The Directors considered that the error would be material to the prior year's Group figures if left unadjusted. To enable a more accurate assessment of the relative performances between the year under review and the prior period, an adjustment was made. The impact is to increase cost of sales by £270,000 in 2008. Trade and other payables are increased by £270,000 in 2008 (£194,000 net of deferred tax liability reduced at 28%), and £66,000 in 2007 (£47,000 net of deferred tax at 28%) with a corresponding decrease in reserves brought forward. This information is also disclosed in note 5 to the accounts.
Financing
Net debt increased to £19.3m compared to £18.0m as at 29 April 2008. This increase is principally as a result of acquiring Gamingking plc and significant capital investment for new business, new products and reorganistion of the combined group.
As part of the transaction above, the Group successfully renewed its banking facilities with HBOS. At the end of April 2009 bank debt stood at £10.7m (April 2008: £11.2m), made up of a loan of £8.3m and overdraft of £2.4m (April 2008: loan £10.1m, overdraft £1.1m). The loan is repayable over a five-year term ending in September 2012. We are currently in discussion with our bankers regarding future facilities. Full details are set out in note 1 to the consolidated financial statements. During the year, the Group also settled an outstanding loan liability of £0.4m relating to pre-acquisition borrowings by Gamingking plc. Total loan repayments during the year were £2.2m.
In addition, a vendor loan of £2.2m remains outstanding. This loan was created on the acquisition of the Crown Leisure estate, and is repayable by 2012, with capital repayments beginning in September 2009.
The Group uses finance leasing to acquire certain of its plant and equipment. At the end of April 2009, asset finance outstanding totalled £7.2m (April 2008: £5.1m). The leases are held with various financial institutions under differing terms, but in general machine assets are financed over a period of 24 months, with commercial vehicles financed over a period of up to 48 months. Repayments of finance lease facilities during the period totalled £7.9m.
Cash and cash equivalents decreased by £1m to £1.6m, primarily as a result of acquiring the Gamingking business. In June 2009 , the placing of 16,603,400 shares raising £5.5m ensures the Group can continue with its growth strategy without the same reliance on asset finance providers.
All key financing covenants have been met for the period.
Financial risk treasury management
The majority of the Group's borrowings are fixed through a combination of fixed rate securitised debt and interest rate swaps. The banking and covenants are reviewed throughout the year as part of the internal reporting process with a focus on ensuring appropriate headroom is available.
Interest rate risk
The Group uses an interest rate collar to manage its exposure to interest rate movements on its bank borrowings. Contracts covering notional amounts equivalent to the bank loan restrict interest payments at rates between 4.7% and 5.75% over the life of the loan. The fair value of the collar at the reporting date is reflected in the Group balance sheet under the derivative financial instrument heading.
Currency rate risk
The Group buys currency at spot rate, however in recent months the Group has increased trading with overseas companies and recognises that its exposure may increase in the future. The Group will look to minimise any increased exposure to foreign exchange through the use of currency instruments, if appropriate.
Liquidity risk
The Group's approach to managing liquidity is to ensure, as far as possible, that it has sufficient liquidity to meet its liabilities as they fall due with surplus facilities to cope with any unexpected variances in timing of cash flows. At 30 April 2009, the Group had undrawn borrowing facilities of £3.1m (2008: £5.7m), of which £1.2m (2008: £1.9m) were uncommitted.
Taxation
The effective tax rate for the year was 26.7% (2008: 10.5%).
Lesley Humphrys
Finance Director
7 October 2009
Consolidated income statement
for the year ended 30 April 2009
Note 30 April 2009* Restated
£000 29 April 2008**
£000
Revenue 2 39,205 21,354
Direct costs (28,068) (16,095)
Gross profit 11,137 5,259
Distribution costs (104) (42)
Administrative expenses - normal (7,462) (3,295)
Administrative expenses - exceptional 4 (236) 751
Total administrative expenses (7,698) (2,544)
Profit on disposal of property, plant 154 8
and equipment
Operating profit 3,489 2,681
Operating profit before exceptional 3,725 1,930
items
Exceptional items (236) 751
Operating profit 3,489 2,681
Finance income - 7
Finance costs (1,907) (891)
Net finance expense (1,907) (884)
Profit before taxation 1,582 1,797
Tax expense 6 (422) (189)
Profit for the financial year 1,160 1,608
Profit attributable to:
- Equity holders of the parent 1,127 1,602
- Minority interests 33 6
1,160 1,608
Earnings per Ordinary Share
- Basic 8 3.1p 4.9p
- Diluted 8 3.0p 4.9p
* Results for the year ended 30 April 2009 are Orb Holdings Limited for the full 12 months plus Gamingking plc from the date of acquisition, 29 September 2008.
** Results for the year ended 29 April 2008 are of Orb Holdings Limited only adjusted from those previously published as described in note 5.
Consolidated balance sheet
at 30 April 2009
Note £000 30 April 2009 £000 Restated
£000 29 April 2008
£000
Assets
Non-current assets
Intangible assets 9 4,924 2,166
Property, plant and equipment 10 26,854 21,732
Derivative financial - 7
instruments
Total non-current assets 31,778 23,905
Current assets
Inventories 1,092 585
Trade and other receivables 4,744 2,957
Cash and cash equivalents 719 449
Total current assets 6,555 3,991
Total assets 38,333 27,896
Liabilities
Current liabilities
Trade and other payables (10,365) (5,331)
Interest bearing loans and (10,230) (6,074)
borrowings
Total current liabilities (20,595) (11,405)
Non-current liabilities
Trade and other payables (468) (433)
Interest bearing loans and (9,772) (12,411)
borrowings
Deferred taxation (916) (959)
Derivative financial (414) -
instruments
Total non-current liabilities (11,570) (13,803)
Total liabilities (32,165) (25,208)
Net assets 6,168 2,688
Equity
Share capital 4,554 3
Share premium account 173 38
Merger reserve (2,332) 104
Retained earnings 3,733 2,536
Equity attributable to equity 6,128 2,681
holders of the parent
Minority interest 40 7
Total equity 6,168 2,688
These financial statements were approved by the Board of Directors on 7 October 2009 and were signed on its behalf by:
Kenneth Turner
Director
Consolidated cash flow statement
for the year ended 30 April 2009
Note £000 30 April 2009 £000 Restated
£000 29 April 2008
£000
Cash flows from operating
activities
Profit before taxation 1,582 1,797
Adjustments for:
Depreciation 9,002 5,240
Amortisation 206 60
Recognition of negative - (979)
goodwill
Equity-settled share options 97 -
Profit on disposal of (154) (8)
property, plant and equipment
Finance loss/(gain) on 421 (7)
derivative financial
instruments
Finance costs 1,486 891
Cash flows from operating 12,640 6,994
activities before changes
in working capital
Changes in working capital:
Increase in inventories (217) (16)
Increase in trade and other (1,213) (850)
receivables
Increase in trade and other 2,872 4,231
payables
Cash generated from operations 14,082 10,359
Finance costs (1,323) (891)
Income tax received/(paid) 7 (112)
Net cash from operating 12,766 9,356
activities
Cash flows from investing
activities
Purchase of business net of (652) (12,903)
cash acquired
Purchase of property, plant (6,915) (4,453)
and equipment
Sale of property, plant and 1,907 602
equipment
Net cash used in investing (5,660) (16,754)
activities
Cash flows from financing
activities
Movement in bank loans and (2,225) 9,392
loan notes
Finance lease rental (5,850) (2,617)
drawdowns/(payments)
Equity dividends paid - (160)
New shares issued - 20
Net cash (used in)/generated (8,075) 6,635
from financing activities
Net decrease in cash and cash (969) (763)
equivalents
Cash and cash equivalents at (668) 95
start of period
Cash and cash equivalents at (1,637) (668)
end of period
Consolidated statement of changes in equity
attributable to equity holders of the parent
Restated Share Share premium Merger reserve Retained earnings Equity attributable Minority Total
29 April 2008 capital account £000 £000 to equity holders of interest equity
£000 £000 the parent £000 £000
£000
At 30 April 2007 3 18 104 1,094 1,219 - 1,219
(restated - see note 5)
Profit for the financial year - - - 1,792 1,792 11 1,803
as previously reported
Prior year adjustment - - - (265) (265) (5) (270)
(see note 5)
Taxation effect of prior year - - - 75 75 1 76
adjustment (see note 5)
Dividends - - - (160) (160) - (160)
Issue of shares in the year - 20 - - 20 - 20
and net premium
At 29 April 2008 (restated) 3 38 104 2,536 2,681 7 2,688
30 April 2009 Share capital Share premium Merger reserve Retained earnings Equity attributable Minority Total equity
£000 account £000 £000 to equity holders of interest £000
£000 the parent £000
£000
At 29 April 2008 (restated) 3 38 104 2,536 2,681 7 2,688
Adjustments arising from 4,551 135 (2,436) - 2,250 - 2,250
reverse acquisition
Profit for the financial year - - - 1,127 1,127 33 1,160
Employee share-based payments - - - 97 97 - 97
Taxation effect of employee - - - (27) (27) - (27)
share-based payment
At 30 April 2009 4,554 173 (2,332) 3,733 6,128 40 6,168
1 Accounting policies
Basis of preparation
The financial information has been prepared in accordance with the accounting policies set out in the Group's Annual Report and audited accounts for the year ended 30 April 2009 which are based on the recognition and measurement principles of IFRS in issue as adopted by the European Union (EU) and are effective at 30 April 2008 or are expected to be adopted and effective at 30 April 2008, our first annual reporting date at which we are required to use IFRS as adopted by the EU.
The financial information set out in this announcement does not constitute the Group's statutory accounts, as defined in Section 435 of the Companies Act 2006, for the years ended 30 April 2009 or 29 April 2008, but is derived from the 2009 Annual Report. Statutory accounts for 2008 have been delivered to the Registrar of Companies and those for 2009 will be delivered in due course. The auditors have reported on those accounts; their reports were unqualified, however they included a reference to an emphasis of matter with regard to renewing certain existing facilities, obtaining additional facilities sufficient to meet the Group's needs and resetting certain covenants.
The financial statements of the Group for the year ended 30 April 2009 comprise Sceptre Leisure plc ('Company' - formerly Gamingking plc) and its subsidiaries (together referred to as the 'Group').
On 29 September 2008 the Company, then named Gamingking plc, became the legal parent company of Orb Holdings Limited (parent company of Sceptre Leisure Solutions Limited) in a share for share transaction. Due to the relative values of the companies, the former Orb Holdings Limited shareholders became the majority shareholders with 85% of the enlarged share capital. Following the transaction the Company's continuing operations and executive management were predominantly those of Orb Holdings Limited. Accordingly the substance of the combination was that Orb Holdings Limited acquired Gamingking plc in a reverse acquisition. As part of the business combination Gamingking plc changed its name to Sceptre Leisure plc.
As a consequence of applying reverse acquisition accounting, the results of the Group at 30 April 2009 comprise the results of Orb Holdings Limited for the year ended 30 April 2009 and those of Gamingking plc from 29 September 2008. The comparative figures for the Group are those of Orb Holdings Limited for the year ended 29 April 2008. The fair values of Gamingking plc's assets and liabilities as at 29 September 2008 have been consolidated as set out in note 11.
The comparative figures for the financial year ended 29 April 2008 are not the Company's consolidated statutory accounts for that financial year, but are derived from the accounts of Orb Holdings Limited. The 2008 consolidated results were prepared in accordance with EU-IFRSs and were presented in the Admission Document dated 2 September 2008.
The accounts for the financial year ended 30 April 2008, which were prepared under UK GAAP and which, prior to the reverse acquisition, dealt with the basis of Gamingking plc in a full 12 months, have been reported on by the then auditor, Grant Thornton LLP, and delivered to the Registrar of Companies.
2 Revenue
Revenue 30 April 2009 29 April
£000 2008
£000
Equipment sales 307 404
Machine rental 36,361 20,950
Sale of lottery, indoor gaming, and leisure 2,537 -
products
Total revenues 39,205 21,354
3 Segmental report
The Board of Directors manages the Group in three business segments:
- machine sales and rental;
- the sale of lottery, indoor gaming and other products, and
- the operation of lotteries on behalf of charities.
During the period under review, over 90% of the Group's activities related to machine sales and rental, and therefore the remaining segments have been consolidated due to materiality. During the prior period, all activity was attributable to one business segment, that of machine sales and rental, and the 2008 comparative figures are therefore not analysed by segment.
All revenue reported in the period under review arose within the United Kingdom.
Segment performance is monitored monthly as part of the management reporting process. The financial performance for each segment is analysed and consolidation adjustments to reach the Group results are shown separately. Information for the year ended 30 April 2009 is shown below:
Segmental analysis Machine sales Other Central 2009 2008
and rental £000 corporate Group Group
£000 costs £000 £000
£000
Revenue 36,668 2,537 - 39,205 21,354
Gross profit 9,746 1,391 - 11,137 5,259
Operating profit 4,225 (214) (522) 3,489 2,681
Segment assets 33,075 5,258 - 38,333 27,896
Segment liabilities (30,438) (1,727) - (32,165) (25,208)
Other segment information:
Capital expenditure (note 10) 14,481 362 - 14,843 9,808
Intangible assets - additions - 2,964 - 2,964 2,165
(note 9)
Purchase of subsidiary - 652 - 652 12,903
Depreciation (note 10) 8,829 173 - 9,002 5,242
Amortisation (note 9) 120 86 - 206 60
Recognition of negative - - - - (979)
goodwill (note 11)
Equity-settled share options 38 20 39 97 -
Finance loss/(gain) on 421 - - - (7)
derivative financial
instruments
4 Exceptional items
30 April 2009 29 April 2008
£000 £000
Restructuring and redundancy 118 228
Provision for rentals and business rates on 47 -
onerous leases
Professional and financial expenses relating to 71 -
corporate restructuring
Recognition of negative goodwill on acquisition - (979)
Exceptional items cost/(credit) 236 (751)
5 Prior year adjustment
During the year the Company identified that certain costs of sale were hitherto accounted for in the wrong period. This has been corrected by restatement of the 2008 comparatives included in these financial statements. The effect of this restatement is to increase cost of sales by £270,000, reduce profit before tax for 2008 by £270,000, reduce the tax expense for 2008 by £76,000, increase trade creditors by £270,000 and reduce net assets as at 29 April 2008 by £194,000. An adjustment of £47,000 has also been made to retained earnings as at 1 May 2007 to correct the impact on earlier periods.
6 Taxation
Recognised in the income statement £000 30 April 2009 £000 Restated
£000 29 April
2008
£000
Current tax expense:
Current year 1,099 7
Adjustments for prior years - (51)
Current tax expense 1,099 (44)
Deferred tax expense:
Origination and reversal of (684) 235
temporary differences
Adjustments in respect of previous (88) 12
years
Effect of prior year adjustment 95 -
Effect of tax rate change - (14)
Deferred tax expense (677) 233
Total tax expense 422 189
Reconciliation of effective tax rate 30 April 2009 Restated
£000 29 April
2008
£000
Profit before tax 1,582 1,797
Profit before tax multiplied by standard rate 443 503
of corporation tax in the UK of 28%
(2008: 28%)
Effects of:
Expenses not deductible for tax purposes 53 32
Income not taxable - (274)
Fixed asset differences - (16)
Adjustments in respect of previous years (116) (39)
Losses carried forward 45 -
Small company relief (3) (3)
Effect of tax rate change - (14)
Total tax expense 422 189
7 Dividends
30 April 2009 29 April
£000 2008
£000
Equity:
Ordinary Shares
- 2008 interim (62.7p per share) - 160
- 2009 interim (0p per share) - -
- 160
The Directors do not recommend the payment of a dividend in respect of the current year.
8 Earnings per Ordinary Share
The calculations of earnings per share are based on the following profits and number of shares:
Basic Diluted Restated Restated
30 April 2009 30 April 2009 Basic Diluted
£000 £000 29 April 29 April
2008 2008
£000 £000
Profit for the financial year 1,127 1,127 1,602 1,602
Additional disclosures:
Exceptional administrative 236 236 (751) (751)
expenses
Taxation effect of exceptional (66) (66) (68) (68)
administrative expenses
Profit for the financial year 1,297 1,297 783 783
before exceptional expenses
30 April 2009 29 April 2008
Number of shares Number of
shares
Weighted average number of shares
For basic earnings per share 36,354,494 32,945,762
Share options 1,793,980 -
For diluted earnings per share 38,148,474 32,945,762
The Group's earnings per share are as follows:
30 April 2009 Restated
pence 29 April
2008
pence
- Basic 3.1 4.9
- Diluted 3.0 4.9
- Basic before exceptional expenses 3.6 2.4
As stated in note 1, the Directors have adopted reverse acquisition accounting under IFRS 3 for the period under review. To enable a meaningful comparison and in accordance with IFRS 3, the weighted average number of shares for the periods has been calculated as follows:
For the period ended 29 April 2008, the weighted average number of shares has been based on the 32,945,762 new shares issued on 29 September 2008 as part of the acquisition of Orb Holdings Limited by Gamingking plc.
For the year ended 30 April 2009, the 5,813,958 shares attributable to Gamingking plc have been included for the period beginning 29 September 2008 in order to calculate a weighted average number of shares in issue for the year for the Group.
The total number of shares in issue at 30 April 2009 was 38,759,720.
9 Intangible assets
Goodwill Customer contracts and Brand Total
£000 relationships names £000
£000 £000
Cost
Balance at 1 May 2007 61 - - 61
Additions - 2,165 - 2,165
Balance at 29 April 2008 61 2,165 - 2,226
Balance at 30 April 2008 61 2,165 - 2,226
Acquisitions through business - 2,464 500 2,964
combinations
Balance at 30 April 2009 61 4,629 500 5,190
Amortisation and impairment
Balance at 1 May 2007 - - - -
Charged in the year - 60 - 60
Balance at 29 April 2008 - 60 - 60
Balance at 30 April 2008 - 60 - 60
Charged in the year - 192 14 206
Balance at 30 April 2009 - 252 14 266
Net book value
At 1 May 2007 61 - - 61
At 29 April 2008 and 30 April 61 2,105 - 2,166
2008
At 30 April 2009 61 4,377 486 4,924
Goodwill impairment
Goodwill acquired in a business combination is allocated to the cash-generating units that are expected to benefit from that business combination.
Goodwill is not amortised but is tested annually for impairment. To the extent that the carrying value of the cash-generating unit exceeds the value in use, determined from estimated discounted future net cash flows, goodwill is written down to the value in use and an impairment charge is recognised.
During the year, goodwill was tested for impairment in accordance with IAS 36 'Impairment of assets'. The recoverable amount for the cash-generating unit exceeded the carrying amount of goodwill recorded. The recoverable amount for the cash-generating unit has been measured on a value in use calculation.
The key assumptions for the value in use calculation, performed for a five-year period, are those regarding the discount rates, growth rates, and expected changes to selling price and direct costs during the period. A growth rate of 1% (2008: 1%) was used in the calculation over the five-year period. A pre-tax discount rate of 11% (2008: 9%) was used in the value in use calculation. Changes in selling prices and direct costs are based on management's expectations of future changes in the market. The assumptions, used in these calculations, have historically proved to be materially accurate.
10 Property, plant and equipment
Short leasehold Plant and machinery Fixtures, fittings Motor vehicles Total
property £000 and equipment £000 £000
£000 £000
Cost
Balance at 1 May 2007 22 6,438 208 337 7,005
Acquisitions - 12,313 308 - 12,621
Additions 163 7,821 441 1,383 9,808
Disposals - (2,190) - (27) (2,217)
Balance at 29 April 2008 185 24,382 957 1,693 27,217
Balance at 30 April 2008 185 24,382 957 1,693 27,217
Acquisitions - 967 54 13 1,034
Additions 68 13,886 208 681 14,843
Disposals - (3,313) - (1,305) (4,618)
Balance at 30 April 2009 253 35,922 1,219 1,082 38,476
Depreciation
Balance at 1 May 2007 13 1,640 144 70 1,867
Charged in the year 17 4,905 90 230 5,242
Disposals - (1,612) - (12) (1,624)
Balance at 29 April 2008 30 4,933 234 288 5,485
Balance at 30 April 2008 30 4,933 234 288 5,485
Charged in the year 42 8,351 296 313 9,002
Disposals - (2,532) - (333) (2,865)
Balance at 30 April 2009 72 10,752 530 268 11,622
Net book value
At 1 May 2007 9 4,798 64 267 5,138
At 29 April 2008 and 30 April 155 19,449 723 1,405 21,732
2008
At 30 April 2009 181 25,170 689 814 26,854
The net book value of plant and machinery includes £8,537,000 (2008: £3,163,000) in respect of assets held under finance leases. Depreciation for the year on these assets was £1,742,000 (2008: £755,000).
The net book value of fixtures, fittings and equipment includes £118,000 (2008: £228,000) in respect of assets held under finance leases. Depreciation for the year on these assets was £79,000 (2008: £24,000).
The net book value of motor vehicles includes £801,000 (2008: £1,405,000) in respect of assets held under finance leases. Depreciation for the year on these assets was £79,000 (2008: £230,000).
11 Acquisitions
Reverse takeover of Gamingking plc
On 29 September 2008, the Group acquired Gamingking plc in a share-for-share transaction that is fully explained in note 1.
The consideration for the acquisition is set out below:
Fair value at
dateof
acquisition
£000
Shares in Sceptre Leisure plc 2,252
(5,813,958 Ordinary Shares of 5p each issued at 38.7p)
Consideration 2,252
Acquisition expenses 712
Total consideration 2,964
Initial book value Fair value Fair value at date
at date of adjustment of acquisition
acquisition £000 £000
£000
Intangible assets 1,281 1,683 2,964
Property, plant and equipment 1,034 - 1,034
Deferred taxation 221 - 221
Inventories 290 - 290
Trade and other receivables 573 - 573
Cash and cash equivalents 60 - 60
Total assets 3,459 1,683 5,142
Trade and other payables (1,348) - (1,348)
Deferred taxation (33) (797) (830)
Total liabilities (1,381) (797) (2,178)
Net assets 2,078 886 2,964
Fair value of consideration 2,964
paid, including transaction
and adviser costs of £712,000
Goodwill on acquisition -
As disclosed in note 1, having applied reverse acquisition accounting, the fair value of Gamingking plc's assets and liabilities on acquisition were consolidated into the Group's financial statements as shown above. The consolidated cash flow statement shows the value of the consideration paid, including transaction and adviser costs of £712,000, net of cash acquired of £60,000.
The acquired business contributed revenues of £2.5m and loss before tax of £0.1m to the Group for the period from the date of acquisition to 30 April 2009. If the acquisition had occurred on 1 May 2008, Group revenue would have been £41.0m and profit before tax would have been £1.2m. These amounts have been calculated using the Group's accounting policies.
Fair value adjustment
Under IFRS 3 at the date of acquisition a value has been applied to identifiable intangible assets that would otherwise have been consumed within goodwill. The fair value adjustment to intangible assets relates to the value of acquired customer contracts and related relationships.
The fair value adjustment to deferred taxation relates to the recognition of the customer contracts and related relationships asset.
Crown Leisure
On 12 October 2007, the Group acquired the trade and certain assets of the single-site division of Crown Leisure Limited.
The consideration for the acquisition is set out below:
Fair value at date
of acquisition
£000
Loan notes 2,175
New shares in Sceptre Leisure Solutions Limited 1
(10,204 Ordinary Shares of 10p each issued at par)
Cash 12,632
Consideration 14,808
Acquisition expenses 297
Total consideration 15,105
The issue of new shares in Sceptre Leisure Solutions Limited to Crown Leisure Limited gave that company a 2% minority interest in Sceptre Leisure Solutions Limited amounting to £11,000 at 29 April 2008. The par value of the shares was deemed to equate to fair value at the date of issue.
Initial book value Fair value Fair value at date
at date of adjustment of acquisition
acquisition £000 £000
£000
Intangible assets - 2,165 2,165
Property, plant and equipment 13,204 (583) 12,621
Inventories 614 (126) 488
Trade and other receivables 1,784 (334) 1,450
Cash and cash equivalents 47 (21) 26
Total assets 15,649 1,101 16,750
Trade and other payables (77) - (77)
Deferred taxation - (589) (589)
Total liabilities (77) (589) (666)
Net assets 15,572 512 16,084
Negative goodwill of £979,000, being the difference between the fair value of net assets acquired and consideration paid, arose from this transaction. This negative goodwill was recognised, in full, in the income statement for the period ended 29 April 2009 as a component of administrative expenses.
Fair value adjustment
Under IFRS 3 at the date of acquisition a value was applied to identifiable intangible assets that would otherwise have been consumed within goodwill. The fair value adjustment to intangible assets relates to the value of acquired customer contracts and related relationships.
The fair value adjustments to property, plant and equipment, inventories and trade and other receivables relate to net realisable value provisions. The fair value adjustment to cash and cash equivalents relates to differences identified in cash floats within acquired amusement machines.
The fair value adjustment to deferred taxation relates to the recognition of the customer contracts and related relationships asset.
11 Events after the balance sheet date
On 17 June 2009, the Company announced that it has conditionally placed with Hillroad Investments Limited 16,603,400 new Ordinary Shares of 5p each at a price of 33.1p per share, thereby raising gross proceeds of £5.5m. This placing was agreed with shareholders at the Company's General Meeting held on 2 July 2009. Following the issue of the 16,603,400 Placing Shares the Company now has 55,363,120 Ordinary Shares in issue. For the avoidance of doubt, all capitalised terms have the same meaning as those defined in the General Meeting Circular dated 17 June 2009.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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