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Ocean Finance Loans:
Market Cap
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Update - Final Results
Jacques Vert PLC
13 July 2007
DATE: Embargoed until 07.00am, Friday 13 July 2007
CONTACTS: Paul Allen, Chief Executive
Ian Johnson, Group Finance Director
Jacques Vert Plc
Tel: 08700 345636
Alistair Mackinnon-Musson
Nicola Savage
Hudson Sandler
Tel: 020 7796 4133
Email: jacquesvert@hspr.com
Photographs available: Please contact Hudson Sandler, as above
JACQUES VERT PLC
PRELIMINARY RESULTS
Jacques Vert Plc, the womenswear clothing retailer, is pleased to announce its
preliminary results for the 52 weeks ended 28 April 2007, together with an
update on trading for the 10 weeks since that date.
The Group retails four womenswear brands: Jacques Vert, Windsmoor, Planet and
Precis. Sales are made predominantly in the UK, Canada and Eire through circa
950 outlets.
The key points are:
• Retail sales up 5.4% to £114.9m (2006: £109.0m) and ahead 5.0% on a
like for like basis
• 76% increase in operating profit before exceptional items from continuing
operations to £5.4m (2006: £3.1m)
• Profit before tax of £19.2m (2006: £3.4m) after a net exceptional credit of
£15.9m (2006: £1.3m) primarily relating to a curtailment gain on winding up
the Baird Group Pension Scheme
• Sale of Wholesale Business, Melka Tenson, completed for an Enterprise Value
of £6.25m, yielding net cash to the Group of approximately £2.2m
• Balance sheet strengthened - Group net assets at 28 April 2007 are £20.5m
(2006: £7.0m) including net debt of £0.9m (2006: £0.4m)
• Retail sales ahead by 2.9% in the 10 weeks since 28 April 2007 and like for
like sales increased by 1.2%
Commenting, Derek Lovelock, Chairman, said
"I am pleased to report a significant increase in profit which reflects a strong
performance in what was a difficult market. We look forward to further
developing the Group's Retail Division following the successful disposal of the
Wholesale Division and resolution of legacy issues."
CHAIRMAN'S STATEMENT
I am pleased to report a significant increase in profits during the year ended
28 April 2007. Following the sale of the Wholesale Division in December 2006,
the Group's continuing operations which now comprise of its Retail Division, saw
total sales increase by 5.4% in the year to £114.9 million (2006: £109.0
million). This was an encouraging performance in a difficult market. Operating
profits from continuing operations increased by 76% to £5.4 million (2006: £3.1
million, restated) as a result of both improved sales performance and continued
tight control over costs.
In addition to the disposal of the Wholesale Division, substantial progress was
also made in resolving a number of legacy issues, most notably the compromise
agreement reached in July 2006 to wind up the Baird Group Pension Scheme. This
represents a clear statement of our intent to focus on the Retail Division, by
exploiting the significant value in our existing portfolio of brands and also
exploring other strategic opportunities.
It is generally accepted that the retail climate continues to be weak.
Nonetheless, progress since the year end has been positive with increases in
both total and like for like sales, which is a creditable achievement.
Finally, as always I would like to extend my thanks on behalf of the Board to
all our staff for their contribution and effort over the past year.
Derek Lovelock Chairman
12 July 2007
CHIEF EXECUTIVE'S STATEMENT
Last year we made good progress on a number of fronts and I am pleased to report
Group profit before interest, tax and exceptional items from continuing
operations for the year ended 28 April 2007 increased by 76% to £5.4 million
(2006: £3.1 million, restated). Profit after tax and exceptional items was £19.4
million (2006: £2.6 million, restated).
Retail Division
The Retail Division performed well in what was a difficult market. Total sales
for the year at £114.9 million (2006: £109.0 million) were 5.4% ahead of last
year. Like for like sales were 5.0% ahead of last year with the Planet brand
performing particularly strongly. The Group has benefited from improved product
ranges and customer response to the Group's transactional website has been
encouraging and given a clear view on the opportunity to develop further this
channel to market.
The Group opened a number of new outlets during the year. At the year end the
Group operated from 948 outlets compared with 921 at the beginning of the year.
Gross margin for the year at 63.9% compared with 65.2% in the previous year. The
decline in margin was largely due to the need to remain competitive in a market
which featured a significant level of discounting.
Distribution costs, which comprise of mainly the costs of operating stores,
increased to £58.1 million from £56.5 million. This increase related largely to
costs associated with operating new retail space plus a one off cost to vacate
an onerous property lease.
Administration costs attributable to the continuing operations declined by 13.7%
to £9.9 million (2006: £11.4 million, restated).
Discontinued operations
On 29 December 2006, Jacques Vert completed the disposal of its Wholesale
Division (comprising the Melka and Tenson brands) through the sale of 100% of
its shareholding in M/T Owner AB and its subsidiaries. The results of the
Division have therefore been treated as discontinued operations in this
statement.
The Enterprise Value of the transaction of approximately £6.25 million included
the assumption by the purchaser of net debt outstanding to third parties at
completion including pension liabilities. After costs relating to the
transaction, Jacques Vert received net cash of approximately £2.2 million, which
included the repayment of existing Group debt of £0.4 million giving rise to a
net profit on disposal of approximately £1.8 million in the current year, which
has been treated as an exceptional item.
Exceptional items
In addition to the gain on the sale of M/T Owner AB, the results incorporate a
further net exceptional credit of £14.1 million (2006: £1.3 million credit)
which includes a £16.5 million net curtailment gain arising as a result of the
compromise agreement entered into with the Trustee of the Baird Group Pension
Scheme ("BGPS") in July 2006. Set against this gain within continuing operations
is an exceptional cost of £0.8 million relating to restructuring, primarily in
respect of the relocation of head office functions, and a £1.2 million increase
in legacy business provisions.
A further £0.4 million of restructuring costs were incurred by the discontinued
Wholesale Division, prior to disposal.
Adoption of FRS20
The Group adopted FRS20 "Share based payment" during the year and this gave rise
to a charge during the year of £0.4 million in respect of the costs of share
options and awards under the Jacques Vert Plc Long Term Incentive Plan. In
addition, the prior year's results have been restated to include a charge of
£0.3 million.
Also as a result of adopting FRS20, the net curtailment gain on the winding up
of the BGPS has been calculated after deducting £1.4 million in respect of the
phantom option granted over 10 million ordinary shares in Jacques Vert Plc to
the Trustee of the BGPS as a result of the rise in the market price of the
shares as at 28 April 2007.
Update on pension compromise agreement
As previously reported, the Group entered into a compromise agreement with the
Trustee of the BGPS on 7 July 2006. In summary, the compromise agreement
provided for the BGPS to be wound up and replaced by a new defined benefit
scheme which will have Jacques Vert Plc as the sponsoring employer.
The Trustee of the BGPS is in the process of winding up the BGPS. The members of
the scheme have been given a number of options to choose from in relation to the
transfer of their benefits and the Trustee is awaiting the outcome of this
process. Once this exercise is complete the Company and Trustee will establish
the new defined benefit scheme which is expected to be by the end of the
calendar year. It is estimated that between 50-55% of the BGPS members will opt
to transfer to the new scheme which gives rise to an estimated surplus on an
FRS17 basis of approximately £8.9 million. This surplus has been written off as
there will be no scope for the Group to benefit from the surplus.
Balance sheet
Net assets at the year end at £20.5 million compared to £7.0 million in the
prior year. The increase in net assets is due in the main to the gain arising
from the BGPS compromise agreement described above.
Net debt at the year end amounted to £0.9 million (2006: £0.4 million) and is
after payment of £5.4 million required under the BGPS compromise agreement,
capital expenditure of £1.6 million and the receipt of £2.2 million net proceeds
from the disposal of the Wholesale Division.
The Directors are unable to recommend a dividend in respect of the year ended 28
April 2007 due to a £0.2 million (2006: £4.5 million) deficit on the parent
company's distributable reserves at the year end. Once this deficit has been
eliminated, the Directors will be in a position to consider the payment of a
dividend.
Current trading
The period since the end of April has seen a challenging UK retail market.
Nonetheless our performance has been resilient in the 10 weeks since the year
end with total sales up 2.9% and like for like sales ahead by 1.2%.
Following resolution of the various legacy issues and disposal of the Wholesale
Division we are looking to the development of new channels to market for all our
brands through collaboration with our host store partners, new standalone stores
and exploiting our transactional website, which represents an exciting
opportunity for the Group.
Paul Allen Chief Executive
12 July 2007
Consolidated profit and loss account
For the 52 weeks ended 28th April 2007
Note 52 weeks ended 28 April 2007 52 weeks ended 29 April 2006
(Restated*)
Before Exceptional After Before Exceptional After
Exceptional Items Exceptional Exceptional Items Exceptional
Items Items Items Items
(Note 3) (Note 3)
£000 £000 £000 £000 £000
Turnover 2
Continuing operations 114,888 - 114,888 108,953 - 108,953
Discontinued operations 12,526 - 12,526 24,349 - 24,349
127,414 - 127,414 133,302 - 133,302
Cost of sales (48,770) - (48,770) (51,543) - (51,543)
Gross Profit 78,644 - 78,644 81,759 - 81,759
Net operating expenses (74,489) 14,067 (60,422) (78,469) 1,256 (77,213)
including exceptional items
Operating profit
Continuing operations 5,420 14,475 19,895 3,083 1,256 4,339
Discontinued operations (1,265) (408) (1,673) 207 - 207
4,155 14,067 18,222 3,290 1,256 4,546
Profit on sale of subsidiary 4 - 1,801 1,801 - - -
Profit before 4,155 15,868 20,023 3,290 1,256 4,546
interest and taxation
Net Interest payable 5a (483) - (483) (303) - (303)
Unwinding of discount on 5b (338) - (338) (801) - (801)
provisions
Profit on ordinary 3,334 15,868 19,202 2,186 1,256 3,442
activities before taxation
Tax credit / (charge) on 6 148 - 148 (834) - (834)
profit on ordinary
activities
Profit on ordinary 3,482 15,868 19,350 1,352 1,256 2,608
activities after taxation
and retained profit for the
financial year
Basic earnings per share 7
Total 10.23p 1.38p
Continuing 11.15p 1.41p
Fully diluted earnings per 7
share
Total 9.57p 1.38p
Continuing 10.43p 1.41p
* The comparative figures have been restated following the adoption of FRS20 "
Share based payment" (see note 1).
Consolidated balance sheet
At 28 April 2007
Note 52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
£000 (Restated*)
£000
Fixed assets
Intangible assets 2,287 2,431
Tangible assets 4,854 6,889
7,141 9,320
Current assets
Stocks 27,992 28,309
Debtors: amounts due within one year 14,984 19,984
Cash at bank and in hand 3,644 3,065
46,620 51,358
Creditors: amounts due within one year
Borrowings (4,500) (3,463)
Trade and other creditors (20,947) (23,703)
(25,447) (27,166)
Net current assets 21,173 24,192
Total assets less current liabilities 28,314 33,512
Provisions for liabilities and charges 9 (7,862) (26,489)
Net assets 20,452 7,023
Capital and reserves
Called up equity share capital 19,244 19,244
Share premium account 4,599 4,599
Merger reserve 969 969
Profit and loss deficit (4,360) (17,789)
Equity shareholders' funds 20,452 7,023
* The comparative figures have been restated following the adoption of FRS20 "
Share based payment" (see note 1).
Consolidated cash flow statement
For the 52 weeks ended 28 April 2007
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
(Restated*)
£000 £000
Net cash (outflow) / inflow from operating activities (978) 2,412
Returns on investments and servicing of finance
Income from current asset investment - 300
Interest received 62 117
Interest paid (493) (464)
(431) (47)
Taxation
Corporation tax refunded 197 9
Capital expenditure and financial investment
Purchase of tangible fixed assets (1,627) (2,447)
Proceeds from the sale of tangible fixed assets - 752
Net cash outflow from capital expenditure (1,627) (1,695)
Net cash inflow from sale of subsidiary 2,229 -
Cash inflow before financing (610) 679
Financing
Sale / (purchase) of own shares by ESOP Trust 38 (426)
Increase in bank loans 1,189 -
Net cash inflow /(outflow) from financing 1,227 (426)
Increase in cash during the year 617 253
Reconciliation of operating profit to net cash (outflow) /
inflow from operating activities
Cashflow from continuing operations:
Operating profit 19,895 4,339
Depreciation and amortisation charge 2,165 1,986
Decrease in working capital (1,589) 1,996
Decrease in provisions (22,162) (5,437)
Other non cash charges 364 286
(1,327) 3,170
Cash inflow from discontinued operations: 349 (758)
Net cash (outflow) / inflow from operating activities (978) 2,412
Reconciliation of net cash flow to movement in net debt
Increase in cash during the year 617 253
Increase in bank loans (1,189) -
Change in net debt resulting from cash flows (572) 253
Exchange rate differences 114 (100)
Movement in net debt during the year (458) 153
Net debt at beginning of the year (398) (551)
Net debt at end of the year (856) (398)
* The comparative figures have been restated following the adoption of FRS20 "
Share based payment" (see note 1).
Statement of total recognised gains and losses
For the 52 weeks ended 28 April 2007
52 weeks ended 52 weeks ended
28 April 2007 28 April 2006
(Restated*)
£000 £000
Profit attributable to ordinary shareholders 19,350 2,608
Currency translation differences offset in reserves (423) (171)
(Losses) / gains on pension schemes (5,900) 3,718
Total recognised gains for the year 13,027 6,155
Prior year adjustment - see note 1 (286) -
Total recognised gains since last annual report 12,741 6,155
Reconciliation of movements in equity shareholders' funds
For the 52 weeks ended 28 April 2007
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
(Restated*)
£000 £000
Profit attributable to shareholders for the financial year 19,350 2,608
Adjustment in respect of employee share schemes 402 (140)
Currency translation differences offset in reserves (423) (171)
(Losses) / gains on pension schemes (5,900) 3,718
Net change in equity shareholders' funds 13,429 6,015
Opening equity shareholders' funds 7,023 1,008
Closing equity shareholders' funds 20,452 7,023
* The comparative figures have been restated following the adoption of FRS20 "
Share based payment" (see note 1).
Notes to the Preliminary Results
For the 52 weeks ended 28 April 2007
1. Accounting Policies
The results for the financial year have been audited and have been prepared on
the basis of the accounting policies set out in the Group's statutory accounts
for the year ended 29 April 2006 as revised for the adoption of FRS20.
The Group adopted FRS20 "Share based payment", for the first time during the
year ended 28 April 2007. Accordingly, the prior year comparatives have been
restated to reflect this change in accounting policy. The impact of this change
on the consolidated profit and loss account was a reduction in profits for the
year to 28 April 2007 of £364,000 (2006: £286,000).
The financial information set out in this announcement does not constitute
statutory accounts within the meaning of section 240 of the Companies Act 1985
and is an abridged version of the Group's financial statements for the 52 weeks
ended 28 April 2007 which were approved by the Directors on 12 July 2007.
Financial statements for the 52 weeks ended 29 April 2006 have been delivered to
the Registrar of Companies and those for the 52 weeks ended 28 April 2007 have
yet to be delivered. The auditors have reported on those accounts, their reports
were unqualified and did not contain statements under section 237 (2) or (3) of
the Companies Act 1985.
2. Segmental analysis
The tables below set out information on a global basis for each of the Group's
business segments.
Turnover and Profit before Taxation
52 weeks ended 28 April 2007 52 weeks ended 29 April 2006
Turnover Profit before Tax Turnover Profit before Tax
Before After Before After
exceptional exceptional exceptional exceptional
items items items items
(restated) (restated)
£000 £000 £000 £000 £000 £000
Geographic Area
United Kingdom 100,347 4,564 19,196 95,929 1,875 3,131
Rest of Europe 15,494 (1,339) (1,724) 27,853 (239) (239)
Rest of World 11,573 109 (71) 9,520 550 550
127,414 3,334 17,401 133,302 2,186 3,442
Profit on disposal - Rest of Europe 1,801 -
19,202 3,442
Activity
Retail 114,888 5,205 4,451 108,953 3,243 3,243
Wholesale 12,526 (1,553) (1,961) 24,349 (256) (256)
Legacy - (318) 14,911 - (801) 455
127,414 3,334 17,401 133,302 2,186 3,442
Profit on disposal - Wholesale 1,801 -
19,202 3,442
Turnover by origin is not materially different from turnover by destination.
2. Segmental analysis (continued)
Legacy business refers to activities acquired as part of William Baird Ltd
(formerly William Baird PLC) and considered by the Directors to constitute
separate activities. These include provisions relating to pension deficits and
other legacy business issues.
Net Assets 28 April 2007 29 April 2006
£000 £000
Geographic Area
United Kingdom 20,064 2,643
Rest of Europe - discontinued - 3,958
Rest of World 388 422
20,452 7,023
Activity
Retail 28,017 27,927
Wholesale - discontinued - 4,016
Legacy business (7,565) (24,920)
20,452 7,023
3. Exceptional items
The Group's profit for the year includes the following exceptional items:
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
£000 £000
Continuing operating exceptional items
Retail:
Restructuring costs and costs relating to potential litigation 754 -
Legacy business:
Increase in / (release of) provisions 1,227 (1,256)
Curtailment gain on BGPS (18,918) -
Less: costs relating to BGPS compromise agreement 2,462 -
(14,475) (1,256)
Discontinued operating exceptional items
Restructuring costs 408 -
(14,067) (1,256)
Non-operating exceptional items
Profit on sale of subsidiary (1,801) -
Exceptional items (15,868) (1,256)
4. Profit on sale of subsidiary
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
£000 £000
Assets disposed:
Tangible fixed assets 1,504 -
Stocks 1,583 -
Debtors 2,190 -
Creditors (2,032) -
Provisions (2,817) -
Net tangible assets disposed 428 -
-
Cash consideration 3,625 -
Costs of disposal (1,396) -
Net proceeds from sale of subsidiary 2,229 -
Assets disposed (428) -
Profit on disposal 1,801 -
5. Interest
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
£000 £000
a) Net interest payable - continuing operations
Interest receivable (134) (117)
Interest payable 512 254
378 137
Net interest payable - discontinued operations 105 166
483 303
b) Unwinding of discount on provisions and similar charges
Finance (credit) / charge on pension schemes (59) 366
Unwinding of discount on other provisions 397 435
338 801
6. Taxation
The tax credit of £148,000 (2006: charge of £834,000) arises predominantly in
respect of refunds of overseas tax paid in prior periods. Of this amount, a
credit of £48,000 relates to discontinued operations (2006: £97,000 charge).
7. Earnings per share
Basic and fully diluted earnings per share
The basic earnings per share has been calculated by dividing the
profit after taxation for the year of £19,350,000 (2006: £2,608,000 restated) by
189,073,400 (2006: 188,859,198) being the weighted average number of shares in
issue during the year excluding those held by the Jacques Vert Plc Employee
Share Ownership Plan Trust. The fully diluted earnings per share has been
calculated by dividing the profit after taxation for the year by 202,177,463
(2006: 188,859,198) being the basic number of shares plus those committed under
extant share options and under the Jacques Vert Plc Long Term Incentive Plan ("
the Plan").
Adjusted Earnings per share
The Directors consider that an appropriate measure of the Group's
performance is the adjusted earnings per share in respect of the continuing
operations ("adjusted EPS"). The adjusted EPS has been calculated by dividing an
adjusted profit, below, for the year by the weighted average number of shares in
issue during the period, as above.
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
(Restated)
Adjusted EPS - basic - continuing operations 3.09p 1.40p
Adjusted EPS - fully diluted - continuing operations 2.89p 1.40p
The calculation of adjusted earnings is shown below:
52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
(Restated)
£000 £000
Profit for the year 19,350 2,608
(Profit) / loss from discontinued operations (see note 8) (71) 56
19,279 2,664
Adjusted for:
Exceptional items - continuing operations (14,475) (1,256)
Charges relating to options and awards under the Plan 364 286
Costs of vacating onerous property lease 200 -
Goodwill amortisation 144 144
Unwinding of discount on provisions 338 801
Adjusted profit for the financial year 5,850 2,639
8. Analysis of profits from discontinued operations
Note 52 weeks ended 52 weeks ended
28 April 2007 29 April 2006
£000 £000
Operating profit after exceptional items - discontinued (1,673) 207
Interest 5a (105) (166)
Tax 6 48 (97)
Profit after interest and tax (1,730) (56)
Profit on disposal 4 1,801 -
Total profit/(loss) relating to discontinued operations 71 (56)
9. Provisions
The movement on provisions during the year is as follows:
Pension Other
Pension settlement business
schemes costs provisions Total
£000 £000 £000 £000
At 30 April 2006 21,028 - 5,461 26,489
Utilised (5,401) (315) (1,472) (7,188)
(Credited)/charged to profit and loss account (149) 2,554 1,635 4,040
Loss on pension schemes 5,900 - - 5,900
Finance credit / unwinding of discount (59) - 397 338
Curtailment Gain on BGPS (18,918) - - (18,918)
Disposal of subsidiary (1,964) - (853) (2,817)
Exchange rate adjustments 5 - 13 18
At 28 April 2007 442 2,239 5,181 7,862
- ENDS -
This information is provided by RNS
The company news service from the London Stock Exchange