TIDMAGA
RNS Number : 7478B
Aga Rangemaster Group PLC
07 March 2014
7(th) March 2014
FOR IMMEDIATE RELEASE
AGA RANGEMASTER GROUP PLC
2013 FULL YEAR RESULTS
OPERATING PROFITS UP AS REVENUES START TO GROW AGAIN
AGA Rangemaster Group plc ('the Group'), the specialist in range
cooking and kitchen living, is pleased to announce its full year
results for the year ended 31(st) December 2013.
Financial highlights
-- Revenues of GBP250.4 million (2012: GBP244.6 million) were
up 2.4% for the year; growing 4.4% in the second half.
-- Operating profits of GBP8.2 million (2012: GBP6.5 million)
were up 26.2% indicating operational gearing benefits.
-- Profit before tax after non-recurring costs, pension charges
and finance costs was GBP1.1 million (2012 restated: GBP1.7
million).
-- Balance sheet remains strong with total equity of GBP120.7
million (2012: restated GBP119.9 million) and net cash of GBP5.9
million (2012: GBP5.5 million).
Strategic and operational highlights
-- AGA cooker sales volumes grew 10% in 2013 with electric cooker
models now representing 70% of sales.
-- Rangemaster orders were just ahead of the prior year, while
the other cooker brands overall were slightly lower.
-- Fired Earth sales were up over 5% in 2013 and order intake
has accelerated further. Grange revenues were down 8%.
-- Our new product programmes in place for 2014 show the range
cooker as an urban product where it is a distinctive alternative
to the built-in models.
-- First accreditation received for new Rangemaster product designed
for Chinese market. Launch now in preparation.
William McGrath, Chief Executive commented: "I am pleased with
the progress we achieved in the year as AGA volumes increased
significantly, Rangemaster orders were ahead and Fired Earth is
building momentum.
The tide turning in the housing market proved pivotal and we
will benefit as the number of house moves increase. As revenues
start to grow, with capacity available and with new products and a
widened targeted customer base, we are confident of good progress
in the year."
Enquiries:
William McGrath, Chief Executive 020 7404 5959 (today)
Shaun Smith, Finance Director 01926 455 731 (thereafter)
Simon Sporborg / Laura Jack-Hayes 020 7404 5959
(Brunswick)
AGA RANGEMASTER GROUP PLC
2013 FULL YEAR RESULTS
CHAIRMAN'S STATEMENT
Overview
2013 saw the tide begin to turn in our markets. We now expect
that the product development programmes and the enhanced
operational gearing that we have implemented over the past year
will show their worth as revenues increase. We have some
outstanding brands relevant to contemporary lifestyles and it was
exciting to see the first material signs of improvement with a
GBP5.8 million increase in sales in the year to over GBP250
million. This was driven by second half growth of 4.4% compared to
being flat in the first half. This brought a 26.2% increase in
operating profits for the year to GBP8.2 million. The return on
sales was 3.3% (2012: 2.7%) showing the gap still that remains to
our peak of cycle target of 10%. We maintained our strong balance
sheet position with a cash balance of just under GBP6 million at
the year end.
Our markets
The sharp fall in UK house sales through 2007 / 2008, and the
lengthy trough that followed, had a major impact on us as appliance
sales are positively correlated to house moves. Our markets have
been running around 30% below their peaks. From the middle of 2013,
a concerted effort by the Government and companies in the housing
sector to stimulate demand has given rise to a much-improved
market. On a rolling 12-month basis, monthly mortgage approvals
rose by the end of 2013 to 61,000 from 51,000 at the start of the
year. Approvals of over 70,000 in November and December 2013 were
the highest monthly levels since January 2008. The Bank of
England's February 2014 Inflation Report suggests the trend will
continue through this year. With nearly two thirds of our sales
still linked to UK consumer spending on the home, the housing
market is of central importance to us.
Trading performances
For AGA cookers a good autumn meant sales volumes were up 10% in
the full year having been down 2% at the half year. There was also
a sharp shift towards electric cooker models which represented 70%
of sales in the year. The AGA Dual Control launched in June 2013
has had an immediate impact and over half of sales volumes in the
second half were of Total Control and Dual Control electric models.
These products are factory-finished at our sites in Coalbrookdale
and Telford in Shropshire. In contrast, markets remained difficult
for the cooker/boiler brands. Rayburn and Stanley rely heavily on
refurbishment projects. Overall cast iron cooker volumes fell to
10,000 (from 10,300 in 2012) and Stanley sales in Ireland are 30%
of pre recession levels. The shift to wood burning stoves and
boiler stoves has had a major impact on Stanley and stove sales are
strong. Wood burning products, for their economics and fuel
independence, provide optimism for our heating lines.
Rangemaster had a slow start to the year and volumes were 4%
lower at the half year. We were, however, able to stimulate the
market with new products and volumes were just ahead at 60,500
units by the year end. Overall, revenues finished just ahead for
the year. We rolled out 25 premium design centres with Dixons
Retail plc, which led to AGA Rangemaster receiving their 'White
Goods Partner of the Year' award. Exports were ahead. For
Rangemaster, we continued to achieve growth in France despite weak
markets and we expect to see continental sales continue to grow
with Germany becoming a target market.
In North America, where the housing recovery is quite well
established, we were pleased that AGA Marvel volumes rose by more
than 10%. With the new accounts we have won and the wider market
penetration we have through quality dealers, we expect the trend
lines to continue to be positive. In North America, where we have
long held a modest position on the cooker side, we believe we have
the product mix capable of making our products more of a mainstream
option.
Fired Earth returned to profitability for the first time for
some years with the pick up in revenues of over 5% combined with
the benefits of direct sourcing, tight cost control and the success
of our small store format developed for Greater London. Set against
the improving market backcloth, we expect to deliver progress in a
business that struggled to make its presence felt during the
downturn. We will be considering this year a valorisation exercise
for Fired Earth.
Grange remains in a testing position as revenues fell and losses
continued which offset the benefit of the rationalisation
programmes in Europe and most particularly in North America. We
can, however, see already that the product mix with a more
contemporary slant and the market differentiation provided by the
online design and ordering package, 'My Grange', are starting to
improve the brand's fortunes.
Our increased optimism is based upon the stronger markets, our
enhanced product portfolio for the domestic market and the benefits
of the commitment we have put into growth in international markets.
We have recently obtained our first accreditation to sell a
Rangemaster cooker in China. As range cookers are not a known
category in China, this has been a protracted process. This product
has an innovative new wok burner system that will have wider
international market reach. We are excited about launching our
products in China, with our partner Vatti and we expect more
accreditations will be obtained in the near future.
Strategy
Our task now is to ensure that we seize the opportunities of the
improving markets, our available production capacity and exciting
product innovations. For AGA cookers we can explain to the numerous
long-time owners that the modern, more flexible models bring many
benefits including reduced running costs compared to the older
models. The new models are attracting a wider customer base and a
younger audience to the superior quality of radiant heat cooking -
with the walls of the oven at a constant temperature - as well as
the classic design. We have other new products to introduce aimed
particularly at urban audiences and this is reflected in the
decision to open a shop in the City of London later this year.
For Rangemaster, it is for us, as range cooker experts, to
reiterate the case for the range cooker over built-in options as
providing a heart to the home still in an economic and
space-efficient way. Most cabinetry producers and property
developers prefer built-in and thus can deprive the consumer of a
strong lifestyle option. With consumers expecting choice, the range
cooking story should appeal equally strongly in both the UK and in
our key European growth markets.
The premise from which we build is that the range cooker has a
central role in modern life and that we have products with the
functionality, look and ambience to suit a range of styles and
price points. We continue to target some international markets
where the range cooker is little known, like Germany and China,
both of which have the scale which should materially change the
business once this lifestyle message connects with consumers.
People
We were delighted last year to welcome Rebecca Worthington to
the board as a non-executive director and she now chairs the audit
and risk committee. She brings considerable financial, property and
plc experience to the board. Paul Dermody has relinquished his
chairmanship of the audit and risk committee and will stand down as
a director at the AGM. His contribution over the last decade as a
non-executive director has been tremendous in providing steady
influence and consistent insight while the fortunes of the business
fluctuated.
In June 2013 Mike Bufton, managing director of our UK appliance
operations, died. He was an inspirational leader who had played a
central role in the development of Rangemaster and latterly of AGA
Rangemaster as an integrated operation in the UK. He was succeeded
by Gary Green who is also the Group's manufacturing director. Gary
has an in depth knowledge of manufacturing and has spearheaded the
implementation of efficient manufacturing processes throughout the
Group.
I should like to thank all our employees for their continuing
contribution. We are now embarking on a new phase in the story of
the Group where the emphasis will switch more to commercial and
selling skills. I have confidence that we are developing a team
able to deliver on the operational gearing available.
Dividend
As previously announced, the board proposes not to make dividend
payments without pension scheme trustee agreement in accordance
with the arrangements made on completion of the 2011 triennial
actuarial valuation of the Group's main pension scheme. Agreement
was not sought this year and the board is not proposing to make a
dividend payment in respect of 2013. The next triennial actuarial
valuation as at 31(st) December 2014 will be prepared during 2015
and dividend policy will again be a matter to be discussed.
Current trading
Against a backcloth of increased activity in the UK housing
market, we expect an improved trading performance in 2014.
Currently order intake is over 6% ahead of prior year. This is
higher than the growth rates achieved overall in the second half of
2013. We have indicated price increases for both AGA and
Rangemaster of over 3% at the end of March and expect order intake
to be well up at that point. The estimate book for Fired Earth was
strong at the end of 2013 and that has been translated into sales
growth in the first two months which were up by more than 10%. In
North America the improvement in the housing market is well
established and orders are up again. Our cookware brands selling
online have all had excellent starts to the year. We recognise that
a recovery is not fully embedded. However, with the potential for
growth from our work to move into international markets and with
the expansion of the addressable market in the UK for range
cookers, the outlook for the Group does look better than it has
been for some years.
BUSINESS AND STRATEGIC REVIEW
As the housing market continues to improve, the focus of the
business has to alter as we set out to ensure that we are ready to
take the opportunities from the work we have undertaken over the
last few years on developing new products and on improving the
operational gearing in the business. Below are some of the key
actions taken during 2013 which are set to accelerate the sales
momentum that we have been seeking.
AGA Dual Control, launched in June 2013, has 3 or 5 electric
ovens on one system and two separate hobs. It complements the fully
flexible AGA Total Control, launched in 2011, where the ovens are
separately controlled. Dual Control has been a particular hit with
owners used to keeping a classic AGA on for sustained periods but
who are still attracted by cutting the running costs in half
compared with a comparable old style oil fired AGA as a result of
short heat up times and the ability to use the hot plates
separately. We think that over time an appreciable proportion of
existing owners, of which we estimate there are 250,000, will trade
up to the new generation of models. Special incentive programmes
will run for these target customers throughout 2014.
We support the AGA brand with events across the country and in
home interest magazines. Our campaign centred on 'My AGA : My Warm
Welcome Home' aimed at showing how the AGA cooker adapts to meet
the needs of working families. The campaign is continuing through
spring 2014. For a traditional, often more rural audience, we have
the AGA Ladies Open Point-to-Point Championship which has gained
particular traction through social media, reinforcing the
recognition of AGA in the rural community. We relaunched the AGA
Living magazine with a circulation of over 70,000 with cover
features on Marco Pierre White and Mary Berry both staunch AGA
advocates and owners. The next edition features Richard and Mindy
Hammond.
Our initiatives increased footfall and fed into a strong autumn
sales season - although sales in the year for AGA were still 35%
below the peak years of 2004 - 2006. Order intake volume was 12%
ahead in the year.
We launched the 'iconic' cookware line with a striking AGA
repeater pattern which will provide high recognition levels.
Indeed, Divertimenti and AGA Cookware performed well with
particularly strong sales online by both brands.
Of our cast iron cooker products - both the Rayburn and Stanley
lines - have struggled for some time. Now, by placing them more
firmly in the framework of solid fuel and wood burning products in
which we have long had expertise and which is strengthening as a
market driven by running cost considerations, we believe that we
can stop the volume declines and start to grow. Our stove business
in Ireland is actually already very strong, and led by the
comprehensive re-engineering of the product to meet changing
regulatory requirements, it has become core to Waterford Stanley's
performance and, indeed, our boiler stoves have been taking sales
from Stanley cookers. We are now looking carefully at exports from
Ireland with the greatest potential being the UK and France. As
people recognise the cost and efficiency benefits of our products,
we expect growth and this to pull through a more satisfactory
volume level for Rayburn and Stanley lines. The successful
re-organisation of production facilities in Waterford at a cost of
EUR2.0 million over the last two years has created the opportunity
to galvanise sales of the heating lines. To reinforce the heating
product themes we have produced a booklet - available online -
entitled 'AGA-Rayburn - A Heart-Warming Story' explaining the
remarkable international history of our role in this sector led by
the same team that made the AGA an icon in the 1930's and
1940's.
Rangemaster has been the bedrock brand for the Group during the
recessionary period. Volumes at 60,500 are still well below the
2007 volumes of 76,000. 28% of sales are exports. We have
consolidated our position in the UK and France where we are
comfortably the market leading brand. Our facilities, fully
utilised, can make 100,000 units a year. The style we prefer of
having a design centre in primary retail outlets works well - be it
with independents or with major chains.
The quality and availability of UK made products continues to
impress consumers. We have been emphasising that the quality gap
between ourselves and others in the market is greater but the price
differential is smaller than consumers believe. We continue to show
that Rangemaster has a mainstream market position and that the
stretch up in price point should not cause consumers to default to
built-in options which may be less functional and still require as
much actual space in the kitchen.
We continue to use the flexibility of our production
capabilities in Leamington Spa to provide niche looks, which
delivers products under the Rangemaster, Falcon, Mercury, Redfyre,
Cornufé and AGA Masterchef brands.
A particular success has been to broaden Rangemaster into being
a wider kitchen brand - something now readily accepted across the
sector. Our refrigeration lines sold over GBP5 million in the year.
We continue to develop our sink lines under the Rangemaster brand
as well as under the trade name Leisure - which we manufacture in
our factory in Long Eaton - a facility that makes many of the metal
parts required for AGA and Rangemaster cookers.
La Cornue, our premium range cooker brand, continues to develop
its international platform. We are looking to ensure that good lead
levels for larger projects now translate into revenue growth.
In North America AGA Marvel has performed well and is rebuilding
profitability as the market picks up. We are excited about the new
opportunities that the changing energy regulatory framework is
providing and about the more efficiently constructed products we
have produced at our facility in Greenville, Michigan. We had a
root and branch rethink about the techniques of cabinet
manufacture. A complete new model line up will be launched in the
next few months. The consequence is that we believe we have widened
our addressable market - in applications where temperature control
is particularly important - and indeed we can benefit from filling
gaps that non-compliant products have occupied. The first order has
been received for product developed for an important new OEM
account. We now need to present a more effective case for our hot
side products in North America. We are focussing on the AGA heat
storage lines so that they are given the particular attention
needed by specialists so that AGA is not simply a 'trophy' retail
store line.
Our home fashions brand, Fired Earth, had a much better year. In
2011 we embarked on a strategy to develop and tighten the cost base
and then rebuild revenues often through new smaller stores in the
South East. The business is now operating profitably and recent
months have been particularly encouraging. The tile collection seen
in the new brochure encompasses attractively priced stone and
porcelain tiles as well as stylish and unusual lines so long
associated with Fired Earth as the 'home of great design'. The more
direct sourcing approach we have adopted has helped in margin
recovery and with improved customer service. Our focus on customer
needs fulfilment has made a significant difference, as has the
improved performance of the established major outlets like the
Adderbury and Fulham Road stores. We have seen a rapid growth of
online sales - running at 7% of sales at the start of 2014.
Grange has been a drain on resources for some time. The
programme to bring the cost base in line with achievable revenues
has continued. The cuts to the North American business and the
project to move to one site in Saint Symphorien, France have been
undertaken successfully. At the same time we have been modernising
both the product offering and in particular the way to do business
with the sector changing technology 'My Grange' which means the
consumer can have products specified for their particular needs in
store and order direct from the factory. As this approach becomes
better known and dealers become more comfortable with it, Grange is
seeing a clearer way ahead. Grange has a strong and committed
management team that has systematically addressed the business
issues. The excellent response at this January's Paris trade show,
Maison & Objet, to the Grange presentation was encouraging.
Current order intake is well ahead of the prior year.
Pension scheme funding
The Group's main pension scheme is large relative to the scale
of the Group's operations, and the scheme continues to be monitored
closely. The next triennial actuarial valuation will be carried out
at the end of 2014. In 2013, despite benefits and expenses of over
GBP40 million being paid out, the overall value of assets held by
the Group's pension schemes increased by nearly GBP20 million to
GBP828.9 million. The annual cash benefit outgoings of the Group's
main pension scheme will peak after 2020 at just over GBP50
million. The Group paid GBP4.1 million into pension schemes in
2013, having contributed GBP19.5 million in 2012. The current
deficit recovery plan for the Group's main pension scheme has
payments of nil in 2014, GBP4.0 million in 2015 and GBP10.0 million
being made per annum from 2016.
With markets recovering and gilt yields increasing the actuarial
deficit has reduced far more than the accounting deficit. This is
because while gilt yields rose sharply, those of corporate bonds
moved less. The accounting deficit which was GBP38.7 million as at
31(st) December 2012 fell to GBP35.8 million as at 31(st) December
2013.
The existence of a clear strategy for growth is relevant to our
relationship with stakeholders, the trustees and advisers to the
Group's pension schemes, and regulators. Pension scheme trustees
and regulators do now have to take into account, in their appraisal
of the scheme and its financial requirements, the growth plans of
the sponsor as supporting the long-term security of the scheme
members' position. Although the funding position of the Group's
main pension scheme remains in deficit, the scheme's underlying
finances improved again during the year.
The tasks ahead
Our ambition is to see AGA Rangemaster become the dominant force
in a growing international market for range cookers. The ground
work has been laid - in product and distribution terms. We will
continue to develop our online business, making greater use of the
1.5 million contacts on our customer database. The mission now is
to connect with the lives of consumers thinking of investing in
their kitchens to show how our products meet their needs so well -
for quality food and a great style and ambience at the heart of
their homes.
The opportunities, given a strengthening UK market and the
intriguing potential within international markets, make the
prospects for the Group exciting.
FINANCE REVIEW
Revenue
Group revenues increased by 2.4% to GBP250.4 million from the
GBP244.6 million reported in 2012. First half revenues of GBP119.5
million compare with GBP119.2 million in the first half of 2012.
Second half revenues of GBP130.9 million were 4.4% up (2012:
GBP125.4 million). Of total revenues 37% were outside the UK (2012:
37%).
Operating profit
The operating profit for the year was GBP8.2 million, up from
the operating profit of GBP6.5 million reported in 2012. The second
half profit of GBP6.7 million followed on from a first half profit
of GBP1.5 million as the Group benefitted more fully from the
operational efficiencies established during the economic downturn
and the normal seasonality.
Non-recurring costs
The non-recurring costs of GBP2.2 million related to site
rationalisation programmes involving Waterford Stanley in Ireland
and Grange in France and the costs of closing certain design centre
outlets and the warehouse at Grange in North America. In 2012
non-recurring costs of GBP1.7 million were a result of the
reorganisation of our AGA Rangemaster distribution operations and
retail structures, the benefits of which are now coming
through.
Finance costs
Net finance costs for the year were GBP1.4 million (2012: GBP0.2
million) reflecting the higher borrowing costs of the three year
bank facilities put in place at the end of 2012. Finance costs
include the cost of the GBP30.0 million of pension scheme
guarantees provided and interest payable on the Group's EUR and USD
hedging loans.
Profit before tax
Profit before tax in the year was GBP1.1 million (2012: restated
GBP1.7 million).
Taxation
The Group had a tax charge of GBP0.4 million (2012: restated
GBP0.2 million) on profits before tax of GBP1.1 million. The Group
expects the underlying tax rate to be slightly above the UK
standard rate of 21% from April 2014. There was a tax receipt of
GBP1.7 million in the year as a result of overpaid tax in previous
years. The impact of the pension scheme deficit recovery
contributions in previous years will continue to reduce
significantly future cash tax payments which were nil in 2013.
Earnings per share
Basic earnings per share were 1.2 pence (2012: restated 2.3
pence) based on an average number of shares in issue of 69.3
million (2012: 69.3 million). Adjusted underlying earnings per
share (excluding the pension charge and non-recurring costs and
based on a standard UK tax rate) were 7.6 pence (2012: 7.1
pence).
Dividends
The directors are not recommending a final dividend. This means
no dividends are to be paid in relation to the 2013 results (2012:
nil). Under the arrangements made on completion of the 2011
actuarial valuation of the Group's main pension scheme, agreement
with the scheme trustee would be required prior to a dividend
payment being made and this was not sought in respect of 2013.
Cash flow
The Group has continued with its disciplined approach to cash
management. Cash flow generated from operating activities of GBP8.4
million in the year was up on the GBP2.1 million generated in 2012
and resulted from a determined effort to manage working capital
while supporting the international development of the business.
The net inflow from working capital in the year was GBP0.4
million (2012: GBP5.5 million outflow).
No pension scheme deficit recovery contributions to the Group's
main pension scheme were made in 2013 (2012: GBP16.0 million). No
further deficit recovery payments are scheduled until the GBP4.0
million due in the second half of 2015.
Cash flows relating to discontinued operations amounted to
GBP0.7 million (2012: GBP6.0 million).
Capital expenditure including intangibles in the year totalled
GBP8.5 million compared to GBP6.4 million in 2012. The charge for
depreciation and amortisation of intangibles in 2013 was GBP7.0
million (2012: GBP7.2 million).
Proceeds of GBP1.2 million were received from the disposal of
property, plant and equipment (2012: GBP1.0 million).
The resulting net cash position at 31st December 2013 was GBP5.9
million (2012: GBP5.5 million).
Pensions
The deficit in the Group's pension schemes at the end of 2013
included in the financial statements was GBP35.8 million on an
accounting basis compared with a restated deficit of GBP38.7
million a year earlier. The change over the year reflects primarily
a higher inflation expectation assumption largely offsetting the
increase in the value of the assets held over the year and a higher
liability discount rate of 4.5% (2012: 4.3%). The pension charge in
the year was GBP3.5 million (2012: restated GBP2.9 million). The
IAS 19R pensions restatement is set out in note 4.
CONSOLIDATED INCOME STATEMENT
Year ended 31(st) December
Note 2013 2012
Restated
note 4
GBPm GBPm
Revenue 250.4 244.6
Net operating costs (242.2) (238.1)
Group operating profit 8.2 6.5
Pension charge 4 (3.5) (2.9)
Non-recurring costs 7 (2.2) (1.7)
Profit before finance income / (costs) and tax 2.5 1.9
Finance income 0.1 0.4
Finance costs (1.5) (0.6)
Profit before tax 1.1 1.7
Tax expense 5 (0.4) (0.2)
Profit for the year 0.7 1.5
Profit attributable to:
Equity holders of the parent 0.8 1.6
Non-controlling interests (0.1) (0.1)
Profit for the year 0.7 1.5
Earnings per share attributable to equity holders
of the parent 6 p p
Basic 1.2 2.3
Diluted 1.1 2.3
All operations are continuing.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Year ended 31(st) December 2013 2012
Restated note 4
GBPm GBPm
Profit for the year 0.7 1.5
Other comprehensive income / (losses) to be
reclassified to profit or loss in subsequent
periods:
Exchange adjustments on hedge of net investments - 0.6
Exchange differences on translation of foreign
operations 0.4 (2.8)
Tax on items taken to reserves (0.4) -
Net other comprehensive income / (losses) to
be
reclassified to profit or loss in subsequent
periods - (2.2)
Items not to be reclassified to profit or loss
in subsequent periods:
Actuarial gains / (losses) on defined benefit
pension schemes 2.3 (32.7)
Tax on items taken to reserves (2.3) 7.4
Net other comprehensive losses not to be
reclassified to profit or loss in subsequent
periods - (25.3)
Other comprehensive losses for the year - (27.5)
Total comprehensive income / (losses) for the
year 0.7 (26.0)
Attributable to:
Equity holders of the parent 0.8 (25.9)
Non-controlling interests (0.1) (0.1)
Total comprehensive income / (losses) for the
year 0.7 (26.0)
CONSOLIDATED BALANCE SHEET
As at 31(st) December 1st January
2013 2012 2012
Restated Restated
note 4 note 4
GBPm GBPm GBPm
Non-current assets
Goodwill 65.4 65.3 66.7
Intangible assets 25.5 24.5 23.9
Property, plant and equipment 38.6 38.3 40.8
Other receivables 0.2 0.6 0.7
Deferred tax assets 11.4 14.5 10.8
141.1 143.2 142.9
Current assets
Inventories 45.1 45.9 45.5
Trade and other receivables 35.2 30.9 30.8
Current tax assets - 1.1 1.0
Cash and cash equivalents 21.2 21.0 48.1
101.5 98.9 125.4
--------------------------------------- -------- --------- ------------
Assets held for sale 2.2 2.2 2.6
Total assets 244.8 244.3 270.9
Current liabilities
Borrowings (1.0) (1.3) (1.4)
Trade and other payables (63.9) (61.0) (65.4)
Current tax liabilities (4.0) (3.0) (2.9)
Provisions (2.8) (3.9) (10.2)
(71.7) (69.2) (79.9)
Net current assets 29.8 29.7 45.5
Non-current liabilities
Borrowings (14.3) (14.2) (15.4)
Retirement benefit obligation (35.8) (38.7) (22.6)
Deferred tax liabilities (0.8) (1.2) (5.0)
Provisions (1.5) (1.1) (1.5)
(52.4) (55.2) (44.5)
Total liabilities (124.1) (124.4) (124.4)
Net assets 120.7 119.9 146.5
Equity
Share capital 32.5 32.5 32.5
Share premium account 29.6 29.6 29.6
Other reserves 82.2 81.8 84.0
Retained (losses) / earnings (23.6) (24.1) 0.2
Equity attributable to equity holders
of the parent 120.7 119.8 146.3
Non-controlling interests - 0.1 0.2
Total equity 120.7 119.9 146.5
CONSOLIDATED CASH FLOW STATEMENT
Year ended 31(st) December 2013 2012
Restated
note 4
GBPm GBPm
Operating activities
Profit before tax: 1.1 1.7
Reconciliation of profit before tax to net cash
flows:
Net finance costs 1.4 0.2
Depreciation of property, plant and equipment 4.7 5.1
Amortisation of intangible assets 2.3 2.1
Net profit on disposal of property, plant and
equipment and assets held for sale (1.0) (0.5)
Share based payments expense 0.1 0.2
Decrease / (increase) in inventories 0.8 (1.0)
Increase in receivables (3.7) (0.3)
Increase / (decrease) in payables 3.3 (4.2)
Decrease in provisions - (0.6)
Pension charge 3.5 2.9
Pension contributions (4.1) (3.5)
Cash generated from operating activities 8.4 2.1
Deficit recovery pension contributions - (16.0)
Cash flows related to discontinued operations (0.7) (6.0)
Finance income 0.1 0.4
Finance costs (1.4) (0.5)
Tax receipt / (payment) 1.7 (0.3)
Net cash flows generated from / (used in) operating
activities 8.1 (20.3)
Investing activities
Purchase of property, plant and equipment (5.5) (3.7)
Expenditure on intangibles (3.0) (2.7)
Proceeds from disposal of property, plant and
equipment and assets held for sale 1.2 1.0
Net cash used in investing activities (7.3) (5.4)
Financing activities
Dividends paid - (0.8)
Borrowing costs (0.3) (0.2)
Repayment of borrowings (0.3) (0.3)
Net cash used in financing activities (0.6) (1.3)
Effects of exchange rate changes on cash and
cash equivalents - (0.1)
Net increase / (decrease) in cash and cash equivalents 0.2 (27.1)
Cash and cash equivalents at beginning of year 21.0 48.1
Cash and cash equivalents at end of year 21.2 21.0
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to equity holders
of the parent
-------------------------------------------------------
Share Share Other Retained Non-controlling Total
capital premium reserves earnings Total interests equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
At 1(st) January 2012
as reported 32.5 29.6 84.0 21.4 167.5 0.2 167.7
Prior year adjustment
(note 4) - - - (21.2) (21.2) - (21.2)
----------------------------- --------- --------- ---------- ---------- --------- ---------------- --------
At 1(st) January 2012
as restated 32.5 29.6 84.0 0.2 146.3 0.2 146.5
Comprehensive income
Profit / (loss) for the
year - - - 1.6 1.6 (0.1) 1.5
Other comprehensive income
/ (losses):
Exchange adjustments on
hedge of net investments - - 0.6 - 0.6 - 0.6
Exchange differences on
translation of foreign
operations - - (2.8) - (2.8) - (2.8)
Actuarial losses on defined
benefit pension schemes - - - (32.7) (32.7) - (32.7)
Tax on defined benefit
pension schemes and tax
losses - - - 7.4 7.4 - 7.4
Total comprehensive losses
for the year to 31(st)
December 2012 - - (2.2) (23.7) (25.9) (0.1) (26.0)
Share based payments - - - 0.2 0.2 - 0.2
Dividends paid - - - (0.8) (0.8) - (0.8)
----------------------------- --------- --------- ---------- ---------- --------- ---------------- --------
At 1(st) January 2013 32.5 29.6 81.8 (24.1) 119.8 0.1 119.9
Comprehensive income
Profit / (loss) for the
year - - - 0.8 0.8 (0.1) 0.7
Other comprehensive income
/ (losses):
Exchange differences on
translation of foreign
operations - - 0.4 - 0.4 - 0.4
Actuarial gains on defined
benefit pension schemes - - - 2.3 2.3 - 2.3
Tax on items taken to
reserves - - - (2.7) (2.7) - (2.7)
Total comprehensive income
/ (losses) for the year
to 31(st) December 2013 - - 0.4 0.4 0.8 (0.1) 0.7
Share based payments - - - 0.1 0.1 - 0.1
At 31(st) December 2013 32.5 29.6 82.2 (23.6) 120.7 - 120.7
NOTES
1. Segmental analysis
The directors consider that there are two operating segments
namely AGA and Rangemaster.
The two operating segments are considered to meet the
aggregation criteria of IFRS 8 in full and so the directors
consider that there is only one aggregated reportable segment.
Disclosures in respect of revenues from external customers and
non-current assets are provided below:
2013 2012
-------------------- --------------------
Non- Non-
current current
Revenue assets Revenue assets
Restated
note 4
GBPm GBPm GBPm GBPm
United Kingdom 158.0 58.8 155.2 59.6
North America 32.1 28.3 29.4 29.1
Europe 54.0 42.6 53.2 40.0
Rest of World 6.3 - 6.8 -
Total operations 250.4 129.7 244.6 128.7
Tax - 11.4 - 14.5
Total 250.4 141.1 244.6 143.2
2. Dividends
The directors are not recommending a final dividend in respect
of the financial year ended 31(st) December 2013 (2012: nil).
3. Exchange rates
The income statements of overseas subsidiaries are translated
into sterling using average exchange rates and balance sheets are
translated at year end rates.
4. Pensions
2013 2012
Restated
GBPm GBPm
Current service cost - defined benefit 2.4 2.4
Net interest cost on net defined benefit obligation 1.1 0.5
Pension charge included in the consolidated income
statement 3.5 2.9
Restatement
IAS 19R has been applied retrospectively from 1(st) January
2012. As a result, expected returns on pension schemes' assets are
no longer recognised in profit or loss. Instead, net interest on
the net defined benefit obligation is recognised in profit or loss,
calculated using the discount rate used to measure the pension
liability. Given the profile of the scheme the present value of
projected future general administration expenses that are a direct
consequence of past service, paid by the scheme and the Company,
has now been included as part of the retirement benefit obligation
rather than being included in the current service cost and the
costs of managing the plan assets are deducted as incurred in
determining the return on plan assets which is recognised in other
comprehensive income.
The impact on the 2012 consolidated income statement,
consolidated statement of comprehensive income, consolidated
balance sheet and EPS is as follows. There was no overall impact to
the cash used in operating activities in the cashflow
statement.
2012
GBPm
Impact on the consolidated income statement:
Decrease in current service cost 1.1
Increase in net interest on net defined benefit
obligation (7.8)
Increase in net pension charge (6.7)
Decrease in tax expense 1.4
-------------------------------------------------------- -------
Impact on the consolidated income statement (5.3)
Impact on the consolidated statement of comprehensive
income:
Decrease in profit for the period (5.3)
Decrease in actuarial losses on defined benefit
pension schemes 6.9
Decrease in tax on net defined benefit pension schemes (1.7)
Impact on the consolidated statement of comprehensive
income (0.1)
Impact on the consolidated balance sheet:
Increase in the retirement benefit obligation (27.7)
Increase in the deferred tax asset 6.4
Net impact on equity holders of the parent (21.3)
Decrease in earnings per share attributable to equity
holders of the parent: p
Basic (7.7)
Diluted (7.7)
-------------------------------------------------------- -------
The net impact on the consolidated balance sheet at 1(st)
January 2012 is a reduction to the equity attributable to equity
holders of the parent of GBP21.2 million, being an increase of
GBP27.9 million to the retirement benefit obligation relating to
the present value of projected future general administration
expenses and a GBP6.7 million increase in the related deferred tax
asset.
5. Tax on profit for the year
2013 2012
Restated
note 4
GBPm GBPm
Current tax on income for year 0.9 2.1
Adjustments in respect of prior years 0.2 (0.2)
United Kingdom corporation tax 1.1 1.9
Overseas current tax on income for year 0.2 0.2
Adjustments in respect of prior years (0.3) 0.2
Overseas corporation tax (0.1) 0.4
Total current tax charge 1.0 2.3
United Kingdom deferred tax credit:
- change in rate of corporation tax (0.2) (0.2)
- current year (0.1) (0.3)
- adjustments in respect of prior years - (0.3)
Overseas deferred tax credit in year (0.2) (0.9)
Overseas deferred tax credit in respect of prior
years (0.1) (0.4)
Total deferred tax credit (0.6) (2.1)
Total United Kingdom tax 0.8 1.1
Total overseas tax (0.4) (0.9)
Tax charge 0.4 0.2
-------------------------------------------------- ------ ---------
Factors affecting the future tax charge
A reduction in the UK corporation tax rate from 24% to 23% was
substantively enacted in July 2012 and was effective from 1(st)
April 2013. Further reductions in the UK corporation tax rate to
21% from 1(st) April 2014 and to 20% from 1(st) April 2015, were
substantively enacted in July 2013 and accordingly, the
substantively enacted rates have been applied in the measurement of
the Group's deferred tax assets and liabilities as at 31(st)
December 2013.
6. Earnings per share ('EPS')
2013 2012
Restated
note 4
GBPm GBPm
Earnings for the purpose of the basic and diluted
EPS
Profit after tax 0.7 1.5
Non-controlling interests 0.1 0.1
Profit attributable to equity holders of the
parent 0.8 1.6
Weighted average number of shares in issue million million
For basic EPS calculation 69.3 69.3
Dilutive effect of share options 0.3 -
For diluted EPS calculation 69.6 69.3
EPS attributable to equity holders of the parent p p
Basic 1.2 2.3
Diluted 1.1 2.3
7. Non-recurring costs
The non-recurring costs during the year of GBP2.2 million
related to site rationalisation programmes initiated in the year
involving Waterford Stanley in Ireland and Grange in France and the
costs of closing certain retailing outlets and the warehouse at
Grange in North America. The directors do not expect further costs
of this level and nature in the next accounting period.
In 2012 the non-recurring costs amounted to GBP1.7 million and
related to the reorganisation of our AGA Rangemaster distribution
operations and retail structures.
2014 financial calendar
Annual General Meeting 1(st) May 2014
2014 Half year close 30(th) June 2014
The 2013 full year results were approved by the board of
directors on 7(th) March 2014. The financial information set out in
this announcement does not constitute the Company's statutory
accounts for the years ended 31(st) December 2013 and 2012. The
financial information within this announcement is prepared in line
with the accounting policies presented within the Company's
statutory accounts for the current and previous years. Statutory
accounts for 2012 have been delivered to the Registrar of Companies
and those for 2013 will be delivered following the Company's Annual
General Meeting. The Company's auditor has reported on these
accounts; its reports were unqualified and did not contain
statements under section 498(2) or (3) of the Companies Act
2006.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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