Colefax
Group plc
CFX
20th July 2009
COLEFAX GROUP PLC
(“Colefax”
or “the Group”)
Preliminary Results for the year ended 30th April
2009
Colefax is an
international designer and distributor of luxury furnishing fabrics & wallpapers
and owns a leading interior decorating business. The Group trades under five
brand names, which serve different segments of the soft furnishings
marketplace; these are Colefax and Fowler, Cowtan & Tout, Jane Churchill,
Manuel Canovas and Larsen.
Highlights
·
Sales down 3% to £75.56m (2008 - £78.18m) and down
by 14% on a constant currency basis
·
Pre-tax profit decreased by 55% to £2.65m (2008 -
£5.94m)
·
Earnings per share fell by 53% to 12.9p (2008 –
27.5p)
·
Strong
cash generation of £1.87m before dividends and share buybacks (2008 - £3.05m)
·
Net
funds at year end of £3.08m (2008 - £2.42m)
·
Proposed final dividend of 1.33p (2008 – 2.65p),
giving a total dividend of 2.88p (2008 – 4.20p), an decrease of 31% on last
year
·
Market conditions remain extremely challenging
David
Green, Chairman of Colefax, commented,
“The
Group has a strong balance sheet, with no debt, and is well placed to deal with
the current recession and capitalise on any opportunities which may arise in
the future.”
Enquiries:
|
Colefax
Group plc |
David
Green, Chairman |
Tel: 020
7448 1000 (today) |
|
|
Robert
Barker, Finance Director |
|
|
|
|
|
|
Biddicks |
|
Tel: 020
7448 1000 |
|
|
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|
|
KBC Peel
Hunt Ltd |
David
Anderson |
Tel: 020
7418 8900 |
|
(Nominated
Adviser & Broker) |
Matthew
Tyler |
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|
|
|
COLEFAX
GROUP PLC
CHAIRMAN’S
STATEMENT
The Group’s pre-tax profit for the year to 30th April 2009
decreased by 55% to £2.65 million (2008 - £5.94 million)
on sales down 3% at £75.56 million (2008 - £78.18 million). Earnings per share decreased by 53% to 12.9p
(2008 – 27.5p) and the Group ended the year with net funds of £3.08 million
(2008 - £2.42 million).
During the year, the Group purchased for cancellation
550,000 shares at an average price of £1.63 per share, representing 3.6% of the
Group’s issued share capital at the start of the year.
Due to the current economic climate, the Board has decided to
recommend that the final dividend is halved to 1.33p per share (2008 - 2.65p),
making a total for the year of 2.88p (2008 – 4.20p), a decrease of 31%. The final dividend will be paid on 9th
October 2009 to shareholders on the register at the close of business on 11th
September 2009.
The principal
reason for the reduction in this year’s results has been the significant
decrease in sales in our largest market, the
·
Fabric - Portfolio of Five Brands:
“Colefax and Fowler”, “Cowtan and Tout”, “Jane Churchill”, “Manuel Canovas” and
“Larsen”
Sales in the Fabric Division,
which represent 81% of Group sales, decreased by 2% to £61.08 million
(2008 - £62.15 million) and by 14% on a constant currency basis.
Sales in the
Sales in Continental Europe, which represent 26% of the
Fabric Division’s sales, declined by 13% on a constant currency basis, with a
very mixed performance between countries. Our principal market of
Sales in the rest of the world, which represent just 3% of
the Fabric Division’s sales, increased by 3% in the year. As there is no major
market, it is difficult to predict future trends in this region, but it is
relatively unimportant to the Group.
Sales of Kingcome furniture, which account for 3% of Group sales,
decreased by 15% to £2.47 million (2008 - £2.92 million) but this activity
remained profitable in the year. Since
January 2009, we have started to see a more significant decrease in sales and
have made a number of redundancies in our manufacturing facility. We are concerned about the short-term
performance of this area of the Group as it is dependent upon the
Sales in our
Accessories Division, which account for 3% of Group sales, increased by 2% to
£2.51 million (2008 - £2.47 million) but decreased by 13% on a like-for-like
basis. The new management team have
worked hard to put together an exciting new range for this year but I am
concerned that in the current economic climate any real progress will be hard
to achieve.
Interior decorating
sales, which account for 13% of Group sales, decreased by 11% to
£9.50 million (2008 - £10.64 million) following an exceptional performance
in 2008. The current order book remains
relatively strong and we are reasonably confident that this year’s results will
be similar to last year’s. Sales of antiques decreased by 20% in the year to
£1.13 million and we expect this area to remain challenging.
In my Chairman’s Statement in July last year, I stated that,
in my opinion, recessions are usually deeper and last longer than everyone
forecasts. Despite this, I believe that
I may have still underestimated the seriousness of this recession and its
affect on our business.
The
David Green
Chairman
20th July 2009
COLEFAX
GROUP PLC
GROUP INCOME STATEMENT
For the
year ended 30th April 2009
|
|
2009 |
2008 |
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
Revenue |
75,562 |
78,181 |
|
Cost of
sales |
35,555 |
36,467 |
|
|
|
|
|
Gross profit |
40,007 |
41,714 |
|
Operating
expenses |
37,351 |
35,633 |
|
|
|
|
|
Profit from operations |
2,656 |
6,081 |
|
|
|
|
|
Finance
income |
45 |
127 |
|
Finance
expense |
(52) |
(266) |
|
|
(7) |
(139) |
|
|
|
|
|
Profit before taxation |
2,649 |
5,942 |
|
|
|
|
|
Tax
expense |
|
|
|
- |
(535) |
(1,899) |
|
-Overseas |
(284) |
22 |
|
|
|
|
|
|
(819) |
(1,877) |
|
Profit for the year attributable to the equity
holders of the parent |
1,830 |
4,065 |
|
|
|
|
|
Basic earnings per share |
12.9p |
27.5p |
|
Diluted earnings per share |
12.4p |
26.1p |
All
activity has arisen from continuing operations.
COLEFAX
GROUP PLC
GROUP BALANCE SHEET
At 30th
April 2009
|
|
2009 |
2008 |
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
Non-current
assets: |
|
|
|
Property,
plant and equipment |
5,718 |
4,960 |
|
Deferred
tax asset |
1,590 |
1,991 |
|
|
7,308 |
6,951 |
|
|
|
|
|
Current
assets: |
|
|
|
Inventories
and work in progress |
13,255 |
13,357 |
|
Trade
and other receivables |
11,661 |
10,561 |
|
Cash
and cash equivalents |
3,079 |
3,862 |
|
|
27,995 |
27,780 |
|
|
|
|
|
Trade
and other payables: |
|
|
|
Current
corporation tax |
387 |
995 |
|
Other
amounts falling due in one year |
13,298 |
14,152 |
|
|
13,685 |
15,147 |
|
|
|
|
|
Net
current assets |
14,310 |
12,633 |
|
|
|
|
|
Total
assets less current liabilities |
21,618 |
19,584 |
|
|
|
|
|
Non-current
liabilities: |
|
|
|
Deferred
tax liability |
- |
123 |
|
Pensions
liability |
485 |
232 |
|
|
485 |
355 |
|
|
|
|
|
Net
assets |
21,133 |
19,229 |
|
|
|
|
|
Capital
and reserves attributable to equity holders of the Company: |
|
|
|
Called
up share capital |
1,481 |
1,536 |
|
Share
premium account |
11,148 |
11,148 |
|
Capital
redemption reserve |
1,393 |
1,338 |
|
ESOP
share reserve |
(30) |
(20) |
|
Share
based payment reserve |
475 |
664 |
|
Foreign
exchange reserve |
2,055 |
124 |
|
Cash
flow hedge reserve |
(370) |
- |
|
Retained
earnings |
4,981 |
4,439 |
|
Total
equity |
21,133 |
19,229 |
The financial statements were
approved by the board of directors and authorised for issue on 20th July 2009.
D. B.
Green Director
R. M.
Barker Director
COLEFAX
GROUP PLC
GROUP CASHFLOW STATEMENT
For the year
ended 30th April 2009
|
|
2009 |
2008 |
|
|
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
Operating
activites |
|
|
|
Profit
before taxation |
2,649 |
5,942 |
|
Finance
income |
(45) |
(127) |
|
Finance
expense |
52 |
266 |
|
Depreciation |
1,795 |
1,690 |
|
|
|
|
|
Cash
flows from operations before changes in working capital |
4,451 |
7,771 |
|
|
|
|
|
Decrease
/ (increase) in inventories and work in progress |
1,032 |
(1,215) |
|
Increase
in trade and other receivables |
(310) |
(672) |
|
Increase
in trade and other payables |
3 |
1,072 |
|
|
|
|
|
Cash
generated from operations |
5,176 |
6,956 |
|
|
|
|
|
|
|
|
|
Taxation
paid |
|
|
|
|
(1,343) |
(2,002) |
|
Overseas
tax paid |
(237) |
(307) |
|
|
(1,580) |
(2,309) |
|
|
|
|
|
Net
cash inflow from operating activities |
3,596 |
4,647 |
|
|
|
|
|
Investing
activities |
|
|
|
Payments
to acquire property, plant and equipment |
(1,729) |
(1,448) |
|
Receipts
from sales of property, plant and equipment |
33 |
10 |
|
Interest
received |
38 |
125 |
|
|
|
|
|
Net
cash outflow from investing |
(1,658) |
(1,313) |
|
|
|
|
|
Financing
activities |
|
|
|
Purchase
of own shares |
(895) |
(465) |
|
Interest
paid |
(72) |
(280) |
|
Equity
dividends paid |
(592) |
(604) |
|
|
|
|
|
Net
cash outflow from financing |
(1,559) |
(1,349) |
|
|
|
|
|
Net
increase in cash and cash equivalents |
379 |
1,985 |
|
Cash and cash equivalents at beginning of year |
2,419 |
363 |
|
Exchange gains / (losses) on cash and cash
equivalents |
280 |
71 |
|
Cash
and cash equivalents at end of year |
3,078 |
2,419 |
COLEFAX
GROUP PLC
GROUP
STATEMENT OF RECOGNISED INCOME AND EXPENSES
For the
year ended 30th April 2009
|
|
2009 |
2008 |
|
|
£'000 |
£'000 |
|
|
|
|
|
Currency
translation differences on foreign currency net investments |
2,961 |
704 |
|
Deferred
tax on long-term loan foreign currency movements |
(1,030) |
(41) |
|
Unrealised
losses on cash flow hedges |
(514) |
- |
|
Deferred
tax on unrealised losses on cash flow hedges |
144 |
- |
|
Net
income recognised directly in equity |
1,561 |
663 |
|
Profit
for the year |
1,830 |
4,065 |
|
Total
recognised income and expense for the year |
3,391 |
4,728 |
COLEFAX
GROUP PLC
NOTES TO THE FINANCIAL INFORMATION
At 30th
April 2009
1.
Earnings Per Share
Basic
earnings per share have been calculated on the basis of profit on ordinary
activities after tax of £1,830,000 (2008 – £4,065,000) and on 14,215,866 (2008
– 14,784,331) ordinary shares, being the weighted average number of ordinary
shares in issue during the year. Shares owned by the Colefax Group Plc
Employees’ Share Ownership Plan (ESOP) Trust are excluded from the basic
earnings per share calculation.
Diluted
earnings per share have been calculated on the basis of profit on ordinary
activities after tax of £1,830,000 (2008 – £4,065,000) and on 14,810,866 (2008
– 15,553,508) being the weighted average number of shares in issue during the
year, calculated as follows:
|
|
2009 |
2008 |
|
Basic weighted average number of shares |
14,215,866 |
14,784,331 |
|
Dilutive potential ordinary shares, including shares under
option owned by the Colefax Group Plc ESOP Trust |
595,000 |
769,177 |
|
|
14,810,866 |
15,553,508 |
2. Cash and Cash Equivalents
For the
purposes of the consolidated cash flow statement, cash and cash equivalents
comprise the following:
|
|
|
|
|
|
2009 |
2008 |
|
|
£’000 |
£’000 |
|
Cash at bank and in hand |
3,079 |
3,862 |
|
Bank overdrafts |
(1) |
(1,443) |
|
|
3,078 |
2,419 |
Cash at bank earns interest at
floating rates based on daily bank deposit rates. The fair value of cash and cash equivalents are
considered to be their book value.
3. The above
financial information, which has been prepared in accordance with International
Financial Reporting Standards as endorsed by the European Union, does not
constitute statutory accounts as defined in Section 435 of the Companies Act
2006.
The
financial information for the year ended 30th April 2009 has been extracted
from the statutory accounts which will be delivered to the Registrar of
Companies following the company’s annual general meeting. The Independent
Auditors’ Report on those financial statements was unqualified and did not
contain a statement under Section 498(2) and Section 498(3) of the Companies
Act 2006. The comparative financial information is based on the statutory
accounts for the financial year ended 30th April 2008 which have been delivered
to the Registrar of Companies.
4. Annual General Meeting
The Annual General Meeting of Colefax Group plc
will be held at 19-23 Grosvenor Hill, London W1K 3QD on 15th September 2009 at
11.00 a.m.