TIDMIRC
RNS Number : 7375Z
Individual Restaurant Company PLC
28 September 2009
Individual Restaurant Company plc
("IRC" or "the Group")
Interim results (unaudited) for the Six Months ended 28 June 2009
Individual Restaurant Company plc ("IRC" or "the Group"), a leading operator of
33 restaurants throughout the UK which trade under the Piccolino (22) and
Restaurant Bar & Grill (11) brands, today announces interim results for the six
months ended 28 June 2009.
* Trading in line with management expectations
* Revenues increased by 5% to GBP25.2m (2008: GBP24.0m)
* Achieved cost savings in the period of GBP1.4m which will equate to a full year
saving of at least the targeted GBP2.0m
* Group EBITDA of GBP1.3m (2008: 1.6m)
* Successful renegotiation of GBP18.5m banking facility;
* Banking headroom of GBP2.1m available at the half year with GBP2.1m (net)
fundraising completed after the balance sheet date
* Successful equity fundraising has been further supported by Lloyds Banking Group
who have cancelled GBP1m of loan amortisation that was originally due in
December 2009
* Interest covered six times by EBITDA
* Banking covenants passed comfortably
Steven Walker, Chief Executive said:
"Whilst the consumer outlook remains challenging, both Piccolino and Restaurant
Bar & Grill continue to deliver a robust performance and trading is in line with
management expectations. We continue to deliver upon our core customer values,
whilst keeping an ongoing focus on cost control. In addition, we have taken
positive steps to reduce the Group's indebtedness and provide additional
headroom going forward. We remain confident of the prospects for the Group over
the medium to long term and are well placed for the upturn in the consumer
environment when it occurs."
28 September 2009
Enquiries:
+---------------------------------------+---------------------------------------+
| Individual Restaurant Company Plc | |
+---------------------------------------+---------------------------------------+
| Steven Walker, Chief Executive | 020 7457 2020 (today) |
+---------------------------------------+---------------------------------------+
| Vernon Lord, Finance Director | 0161 839 5511 (thereafter) |
+---------------------------------------+---------------------------------------+
| | |
+---------------------------------------+---------------------------------------+
| Altium | |
+---------------------------------------+---------------------------------------+
| Mike Fletcher | 0161 831 9133 |
+---------------------------------------+---------------------------------------+
| David Foreman | |
+---------------------------------------+---------------------------------------+
| | |
+---------------------------------------+---------------------------------------+
| College Hill | 020 7457 2020 |
+---------------------------------------+---------------------------------------+
| Justine Warren | |
+---------------------------------------+---------------------------------------+
| Matthew Smallwood | |
+---------------------------------------+---------------------------------------+
Chairman's Statement
Introduction
Individual Restaurant Company plc ("IRC" or "the Group"), a leading restaurant
operator with 33 premium casual dining restaurants throughout the UK which trade
under the Piccolino (22) and Restaurant Bar & Grill (11) brands, announces its
unaudited interim results for the six months ended 28 June 2009.
The Group is pleased to announce overall trading is in line with our
expectations and that the equity fundraising of GBP2.6m, completed post the
balance sheet date, has reduced net indebtedness and provided additional
headroom for the business going forward.
Results
As previously reported the Group recognised trading conditions would be more
challenging in 2009 than 2008 with this being felt most acutely in the first
half of the year. In the six months ended 28 June 2009 revenues increased by
GBP1.2m (5%) to GBP25.2m (2008: GBP24.0m). Restaurant EBITDA decreased across
the Group by GBP0.5m (12%) to GBP3.3m (2008: GBP3.8m*). This was partially
offset by GBP0.2m of central cost savings. Central costs for the period were
GBP1.9m (2008: GBP2.1m). EBITDA for the period was GBP1.3m (2008: GBP1.6m).
In recognition that the economic environment was likely to remain challenging in
2009 the Group implemented a cost saving programme to deliver GBP2.0m of savings
in the full year to December 2009. Progress on this front has been very
pleasing. In the first half of 2009 total savings have been GBP1.4m which will
equate to a full year saving of at least the targeted GBP2.0m. Savings have been
derived from like for like payroll (GBP0.9m, 11%), like for like site overheads
(GBP0.3m, 9%) and central costs (GBP0.2m, 9%).
The gross margin for the period remained in line with 2008 at 73.5%. As
previously reported, the Group has taken a strategic decision to refrain from
entering the mass discounting market which has been widely practised across the
restaurant sector. Tactical promotions have been implemented and at the same
time the Group has been successful in maintaining margins, as well as preserving
the brand value of the Group's premium casual dining concepts. The Board is
confident this remains the correct, long term strategy and will benefit the
Group in the future.
Depreciation in the period was GBP1.5m (2008: GBP1.3m). Actual capital
expenditure is always much lower than the depreciation charge and in the period
maintenance capital expenditure on the estate was GBP0.5m.
The operating loss before exceptional costs in the period was GBP0.2m (2008:
profit GBP0.4m).
Finance costs incurred in the period were GBP0.2m (2008: GBP0.5m). This
reduction was due to the significant reduction in base rate that occurred in Q4
2008 and Q1 2009. Finance costs in the period were six times covered by EBITDA.
In line with the renegotiated banking agreement, finance costs in the second
half will be based upon LIBOR plus 3.5%.
The operating loss was GBP0.6m compared to a profit of GBP0.3m in 2008. However
the 2009 loss is stated after exceptional costs of GBP0.4m. These costs are made
up predominantly from the issue of new shares that was completed early in the
second half of 2009.
Cash flow and Balance Sheet
At 28 June 2009, net debt was GBP16.4m with GBP2.1m of headroom available under
the Group's banking facility. In the period, new banking facility terms were
negotiated up to a maximum borrowing of GBP18.5 million to January 2012
including more appropriate covenant tests and test levels. Previously it was a
rolling facility which was due for repayment three months after each
drawdown. Post the balance sheet date, utilising authorities conferred at this
year's Annual General Meeting, the Group successfully completed a GBP2.6m
fundraising. The proceeds of the fundraising have been used to reduce the
Group's net indebtedness. This will lower the year-end net debt to EBITDA
ratio and creates further headroom in covenants.
Banking covenants are tested every half year on the below basis:
* Net Debt : EBITDA
* EBITDA : Senior Interest
* Cash Flow available for Debt Service : Debt Service
All tests for the period to 28 June 2009 were very comfortably met.
Following the successful equity fundraising, the Group has been in discussions
with its banking partner and has negotiated the cancellation of the planned
facility amortisation of GBP1m scheduled for December 2009. This reduction in
the planned amortisation of the banking facility is a positive step for the
Group and will allow the Group to return to estate growth when the timing is
right.
Roll Out of Piccolino and Restaurant Bar & Grill Brands
The Board firmly believes that both the Piccolino and Bar & Grill brands are
robust and benefit from attractive, long-term business models with significant
roll out potential. Whilst the quantum and timing of openings will still be
determined by trading performance and the available headroom in our banking
facilities, the Group is well positioned to take advantage of the first signs of
returning consumer confidence. The Group has a healthy site pipeline which will
be developed at the appropriate time but this is unlikely to be in the current
financial year.
Current Trading and Outlook
Post the balance sheet date the loss making Piccolino site in Wandsworth has
become a training and development centre for the Piccolino brand which we
believe will add significant benefit over the next few years. The asset had
already been written down to zero value in the 2008 accounts. The Group will
provide GBP0.1m for costs associated with the change of use at this location in
the second half of 2009.
Traditionally the Group's earnings have been heavily weighted towards the second
half of the year and 2009 will be no exception with trading conditions expected
to remain challenging. Cost inflation is expected to have a full year impact in
2009 of GBP0.5m (HY2 GBP0.4m).Trading comparables for 2009 against 2008 are
expected to be less challenging in the second half than in the first due to the
extent to which the second half of 2008 had already been impacted by the
economic downturn. Trading continues in line with our expectations with the
overall out-turn for the year as heavily reliant on Christmas trading as has
been the case in previous years.
The Board believes performance in the first half of 2009 was a creditable
performance. The Board remains confident in both the Group's brands and business
models and the medium and long term prospects for the Group are strong.
Robert Breare
Chairman
27 September 2009
*Restaurant EBITDA for 2008 is shown after GBP0.2m of pre-opening costs
Consolidated Income Statement
+---------------------------------------+------+-------------+-------------+------------+
| | | 6 months | 6 months | 12 months |
+---------------------------------------+------+-------------+-------------+------------+
| | | ended | ended | ended |
+---------------------------------------+------+-------------+-------------+------------+
| | | 28 June | 29 June | 31 |
| | | 2009 | 2008 | December |
| | | | | 2008 |
+---------------------------------------+------+-------------+-------------+------------+
| |Note | (unaudited) | (unaudited) | (audited) |
+---------------------------------------+------+-------------+-------------+------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Revenue | 4 | 25,146 | 23,995 | 52,472 |
+---------------------------------------+------+-------------+-------------+------------+
| Cost of sales | | (6,665) | (6,377) | (13,328) |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Gross profit | | 18,481 | 17,618 | 39,144 |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Other operating expenses | | (18,700) | (17,225) | (36,424) |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Operating (loss) / profit before | | (219) | 393 | 2,720 |
| exceptional costs | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Reversal of impairment for | | - | - | 996 |
| non-current assets | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Impairment of non-current assets | | - | - | (996) |
+---------------------------------------+------+-------------+-------------+------------+
| Increase in provision for onerous | | - | - | (500) |
| leases | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Share based payment charge | | (54) | (54) | (108) |
+---------------------------------------+------+-------------+-------------+------------+
| Costs associated with share offer | | (346) | - | - |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Operating (loss)/profit | 4 | (619) | 339 | 2,112 |
+---------------------------------------+------+-------------+-------------+------------+
| Finance income | | - | 33 | - |
+---------------------------------------+------+-------------+-------------+------------+
| Finance cost | | (219) | (455) | (957) |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| (Loss)/profit before taxation | | (838) | (83) | 1,155 |
+---------------------------------------+------+-------------+-------------+------------+
| Income tax | 6 | - | 229 | (639) |
+---------------------------------------+------+-------------+-------------+------------+
| (Loss)/profit from continuing | | (838) | 146 | 516 |
| operations | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| (Loss)/profit attributable to equity | | | | |
| holders of | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Parent | | (838) | 146 | 516 |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Earnings per share from total and | | | | |
| continuing | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| operations: | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Basic | 5 | (2.1)p | 0.4p | 1.3p |
+---------------------------------------+------+-------------+-------------+------------+
| Diluted | 5 | (2.1)p | 0.4p | 1.3p |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
Consolidated statement of comprehensive income
+--------------------------------------+------+-------------+-------------+-----------+
| |Note | June | June | December |
+--------------------------------------+------+-------------+-------------+-----------+
| | | 2009 | 2008 | 2008 |
+--------------------------------------+------+-------------+-------------+-----------+
| | | (unaudited) | (unaudited) | (audited) |
+--------------------------------------+------+-------------+-------------+-----------+
| | | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------+------+-------------+-------------+-----------+
| | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| (Loss)/profit for the period | | (838) | 146 | 516 |
+--------------------------------------+------+-------------+-------------+-----------+
| | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| Other comprehensive income for the | | - | - | - |
| period | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| Total comprehensive income to the | | (838) | 146 | 516 |
| period | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
| Attributable to equity holders of | | (838) | 146 | 516 |
| the parent | | | | |
+--------------------------------------+------+-------------+-------------+-----------+
Consolidated statement of financial position
+--------------------------------------+----+-------------+-------------+------------+
| | | 28 June | 29 June | 31 |
| | | 2009 | 2008 | December |
| | | | | 2008 |
+--------------------------------------+----+-------------+-------------+------------+
| | | (unaudited) | (unaudited) | (audited) |
+--------------------------------------+----+-------------+-------------+------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Assets | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Non current assets | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Property, plant and equipment | | 36,209 | 32,286 | 36,909 |
+--------------------------------------+----+-------------+-------------+------------+
| Intangible assets | | 38,647 | 38,647 | 38,647 |
+--------------------------------------+----+-------------+-------------+------------+
| Total non current assets | | 74,856 | 70,933 | 75,556 |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Current assets | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Inventories | | 895 | 762 | 1,059 |
+--------------------------------------+----+-------------+-------------+------------+
| Trade and other receivables | | 3,435 | 3,092 | 2,492 |
+--------------------------------------+----+-------------+-------------+------------+
| Derivative financial instrument | | - | 50 | 7 |
+--------------------------------------+----+-------------+-------------+------------+
| Cash and cash equivalents | | 2,096 | 2,097 | 2,686 |
+--------------------------------------+----+-------------+-------------+------------+
| Total current assets | | 6,426 | 6,001 | 6,244 |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Total assets | | 81,282 | 76,934 | 81,800 |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Liabilities | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Current liabilities | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Trade and other payables | | (12,269) | (10,845) | (11,867) |
+--------------------------------------+----+-------------+-------------+------------+
| Provisions | | (177) | - | (177) |
+--------------------------------------+----+-------------+-------------+------------+
| Short term borrowings | | (1,500) | (16,500) | (18,500) |
+--------------------------------------+----+-------------+-------------+------------+
| Total current liabilities | | (13,946) | (27,345) | 30,544 |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Non current liabilities | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Long term borrowings | | (17,000) | - | - |
+--------------------------------------+----+-------------+-------------+------------+
| Provisions | | (364) | (125) | (500) |
+--------------------------------------+----+-------------+-------------+------------+
| Deferred taxation | | (9,707) | (8,839) | (9,707) |
+--------------------------------------+----+-------------+-------------+------------+
| Total non current liabilities | | (27,071) | (8,964) | (10,207) |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Total liabilities | | (41,017) | (36,309) | (40,751) |
+--------------------------------------+----+-------------+-------------+------------+
| | | | | |
+--------------------------------------+----+-------------+-------------+------------+
| Net assets | | 40,265 | 40,625 | 41,049 |
+--------------------------------------+----+-------------+-------------+------------+
Consolidated statement of financial position
+---------------------------------------+------+-------------+-------------+------------+
| |Note | 28 June | 29 June | 31 |
| | | 2009 | 2008 | December |
| | | | | 2008 |
+---------------------------------------+------+-------------+-------------+------------+
| | | (unaudited) | (unaudited) | (audited) |
+---------------------------------------+------+-------------+-------------+------------+
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------------+------+-------------+-------------+------------+
| | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Equity attributable to equity | | | | |
| shareholders of the parent | | | | |
+---------------------------------------+------+-------------+-------------+------------+
| Share capital | 8 | 1,975 | 13,826 | 13,826 |
+---------------------------------------+------+-------------+-------------+------------+
| Share premium account | | 11,663 | 11,663 | 11,663 |
+---------------------------------------+------+-------------+-------------+------------+
| Capital redemption reserve | | 11,851 | - | - |
+---------------------------------------+------+-------------+-------------+------------+
| Merger reserve | | 22,034 | 22,034 | 22,034 |
+---------------------------------------+------+-------------+-------------+------------+
| Shares to be issued | | 270 | 162 | 216 |
+---------------------------------------+------+-------------+-------------+------------+
| Retained earnings | | (7,528) | (7,060) | (6,690) |
+---------------------------------------+------+-------------+-------------+------------+
| Total equity | | 40,265 | 40,625 | 41,049 |
+---------------------------------------+------+-------------+-------------+------------+
Consolidated statement of changes in equity
+-------------------------+------+----------+----------+----------+---------+---------+
| |Note | Share | Other | Shares | Profit | Total |
| | | capital | reserves | to | and | |
| | | | | be | loss | |
| | | | | issued | account | |
+-------------------------+------+----------+----------+----------+---------+---------+
| | | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-------------------------+------+----------+----------+----------+---------+---------+
| | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 1 January 2008 | | 12,409 | 30,866 | 4,356 | (7,206) | 40,425 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Share based payments | | - | - | 54 | - | 54 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Deferred consideration | | 1,417 | 2,831 | (4,248) | - | - |
| shares | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| Transactions with | | 1,417 | 2,831 | (4,194) | - | 54 |
| owners | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| Profit for the period | | - | - | - | 146 | 146 |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 29 June 2008 | | 13,826 | 33,697 | 162 | (7,060) | 40,625 |
+-------------------------+------+----------+----------+----------+---------+---------+
| | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 1 January 2008 | | 12,409 | 30,866 | 4,356 | (7,206) | 40,425 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Share based payments | | - | - | 108 | - | 108 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Deferred consideration | | 1,417 | 2,831 | (4,248) | - | - |
| shares | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| Transactions with | | 1,417 | 2,831 | (4,140) | - | 108 |
| owners | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| Profit for the period | | - | - | - | 516 | 516 |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 31 December 2008 | | 13,826 | 33,697 | 216 | (6,690) | 41,049 |
+-------------------------+------+----------+----------+----------+---------+---------+
| | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 1 January 2009 | | 13,826 | 33,697 | 216 | (6,690) | 41,049 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Share based payments | | - | - | 54 | - | 54 |
+-------------------------+------+----------+----------+----------+---------+---------+
| Share purchase | | (11,851) | 11,851 | - | - | - |
+-------------------------+------+----------+----------+----------+---------+---------+
| Transactions with | | (11,851) | 11,851 | 54 | - | 54 |
| owners | | | | | | |
+-------------------------+------+----------+----------+----------+---------+---------+
| Profit for the period | | - | - | - | (838) | (838) |
+-------------------------+------+----------+----------+----------+---------+---------+
| At 29 June 2009 | | 1,975 | 45,548 | 270 | (7,528) | 40,265 |
+-------------------------+------+----------+----------+----------+---------+---------+
Other reserves represent the share premium account, the merger reserve and the
capital redemption reserve.
Consolidated statement of cash flows
+--------------------------------------------+-------------+-------------+-----------+
| | 6 months | 6 months | 12 months |
| | ended | ended | ended |
+--------------------------------------------+-------------+-------------+-----------+
| | 28 June | 29 June | 31 |
| | 2009 | 2008 | December |
| | | | 2008 |
+--------------------------------------------+-------------+-------------+-----------+
| | (unaudited) | (unaudited) | (audited) |
+--------------------------------------------+-------------+-------------+-----------+
| | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Cash flow from operating activities | | | |
+--------------------------------------------+-------------+-------------+-----------+
| (Loss)/profit before taxation | (838) | (83) | 1,155 |
+--------------------------------------------+-------------+-------------+-----------+
| Adjustments for: | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Depreciation, impairment and amortisation | 1,547 | 1,259 | 2,609 |
| charges | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Share based payment charge | 54 | 54 | 108 |
+--------------------------------------------+-------------+-------------+-----------+
| Interest expense | 219 | 455 | 957 |
+--------------------------------------------+-------------+-------------+-----------+
| Interest received | - | (33) | - |
+--------------------------------------------+-------------+-------------+-----------+
| Movement in provisions | (136) | - | 177 |
+--------------------------------------------+-------------+-------------+-----------+
| (Increase) in trade and other receivables | (953) | (1,126) | (493) |
+--------------------------------------------+-------------+-------------+-----------+
| Decrease/(increase) in inventories | 162 | 47 | (250) |
+--------------------------------------------+-------------+-------------+-----------+
| Increase/(decrease) in trade payables | 433 | (58) | 432 |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Net cash from operating activities | 488 | 515 | 4,695 |
+--------------------------------------------+-------------+-------------+-----------+
| Interest paid | (231) | (433) | (965) |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Net cash used in operating activities | 257 | 82 | 3,730 |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Cash flows from investing activities | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Purchase of property, plant and equipment | (847) | (4,192) | (9,251) |
+--------------------------------------------+-------------+-------------+-----------+
| Purchase of subsidiary | - | (4,248) | (4,248) |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Net cash used in investing activities | (847) | (8,440) | (13,499) |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Cash flows from financing activities | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Proceeds from long term borrowings | 18,500 | 6,000 | 8,000 |
+--------------------------------------------+-------------+-------------+-----------+
| Repayment of loans | (18,500) | - | - |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Net cash from financing activities | - | 6,000 | 8,000 |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Net (decrease) in cash and cash | (590) | (2,358) | (1,769) |
| equivalents | | | |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Cash and cash equivalents at beginning of | 2,686 | 4,455 | 4,455 |
| period | | | |
+--------------------------------------------+-------------+-------------+-----------+
| | | | |
+--------------------------------------------+-------------+-------------+-----------+
| Cash and cash equivalents at end of period | 2,096 | 2,097 | 2,686 |
+--------------------------------------------+-------------+-------------+-----------+
Notes to the interim report
1. Nature of operations and general information
Individual Restaurant Company plc and its subsidiaries (the Group) principal
activities are those of restaurateurs. Individual Restaurant Company plc is the
Group's ultimate parent company. See note 4 for further information about the
Group's operating segments.
Individual Restaurant Company Plc is the Group's ultimate parent company. It is
a company incorporated in the United Kingdom under the Companies Act 1985 with
registration number 4026693. The company is domiciled in the United Kingdom and
has its registered office at 4th Floor, Ridgefield House, 14 John Dalton Street,
Manchester, M2 6JR. The company's shares are listed on the Alternative
Investment Market of the London Stock Exchange.
The financial information for the year ended 31 December 2008 set out in this
interim report does not constitute statutory accounts as defined in Section 240
of the Companies Act 1985. The Group's statutory financial statements for the
year ended 31 December 2008 have been filed with the Registrar of Companies. The
auditor's report on those financial statements was unqualified and did not
contain statements under Section 237(2) or Section 237(3) of the Companies Act.
The interim report is presented in Pounds Sterling (GBP) and all values are
rounded to the nearest thousand pounds (GBP'000) except where stated otherwise.
The interim report was approved by the Board on 27 September 2009.
2. Basis of preparation
This interim report is for the six months to 28 June 2009. It has been prepared
in accordance with the recognition and measurement requirements of those IFRS
(International Financial Reporting Standards) as adopted by the EU, which are
applicable to the financial statements for the period ended 31 December 2008. It
does not include all of the information required for full annual financial
statements, and should be read in conjunction with the consolidated financial
statements of the Group for the period ended 31 December 2008.
These financial statements have been prepared using the measurement basis
specified by IFRS for each type of asset, liability, income and expense.
The amounts included in these statements may therefore change as a result of
subsequent amendments to IFRS or for new standards issued after the balance
sheet date.
This interim report has been prepared in accordance with the accounting policies
set out in the statutory accounts for the period to 31 December 2008. The
Directors do not consider that there will be a change in accounting policies for
the period to 31 December 2009, except for the adoption of IAS 1 Presentation of
Financial Statements (Revised 2007) and IFRS 8 Operating Segments. The
accounting policies have been applied consistently throughout the Group for the
preparation of this interim report.
The adoption of IAS 1 (Revised 2007) does not affect the financial position or
profits of the Group, but gives rise to additional disclosures. The measurement
and recognition of the Group's assets, liabilities, income and expenses is
unchanged. IAS 1 (Revised 2007) affects the presentation of owner changes in
equity and introduces a "Statement of comprehensive income. Further, a
"Statement of changes in equity" is presented.
The adoption of IFRS 8 has changed the segments that are disclosed in the
interim financial statements. In the previous annual and interim financial
statements, segments were identified by reference to the dominant source and
nature of the group's risks and returns i.e. from restaurant sales. Under IFRS 8
the accounting policy for identifying segments is now based on the internal
management reporting information that is regularly reviewed by the chief
operating decision maker, being the 2 brands operated by the group.
3. Principal risks affecting the group
The Directors consider that the principal risks and uncertainties affecting the
business remain unchanged from those discussed in page 11 of their report in the
financial statements for the period to 31 December 2008. In particular they
consider that two of those risks, namely;
* Adverse economic conditions and decline in consumer confidence in the UK
* Increases in prices of key raw materials, wages and overheads (including
utilities)
have increased in likelihood as a result of the impact of the economic downturn,
and the Board continues to address the risk.
4. Segmental reporting
Management currently identifies the Group's two brands as operating segments.
These operating segments are monitored and strategic decisions are made on the
basis of adjusted segment operating results.
Segmental information can be analysed as follows for the reporting periods under
review:
+--------------------------------------+------------+-----------+---------+----------+
| 6 months ending 28 June 2009 | Restaurant | Piccolino | Other | Total |
| | Bar and | | | |
| | Grill | | | |
+--------------------------------------+------------+-----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------+------------+-----------+---------+----------+
| | | | | |
+--------------------------------------+------------+-----------+---------+----------+
| Revenue | 10,348 | 14,798 | - | 25,146 |
+--------------------------------------+------------+-----------+---------+----------+
| Cost of sales | (2,833) | (3,832) | - | (6,665) |
+--------------------------------------+------------+-----------+---------+----------+
| Other operating expenses | (6,710) | (9,929) | (2,061) | (18,700) |
+--------------------------------------+------------+-----------+---------+----------+
| Costs associated with share offer | - | - | (346) | (346) |
+--------------------------------------+------------+-----------+---------+----------+
| Share option charge | - | - | (54) | (54) |
+--------------------------------------+------------+-----------+---------+----------+
| Segment operating profit/(loss) | 805 | 1,037 | (2,461) | (619) |
+--------------------------------------+------------+-----------+---------+----------+
| | | | | |
+--------------------------------------+------------+-----------+---------+----------+
+--------------------------------------+------------+-----------+---------+----------+
| 6 months ending 29 June 2008 | Restaurant | Piccolino | Other | Total |
| | Bar and | | | |
| | Grill | | | |
+--------------------------------------+------------+-----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------------+------------+-----------+---------+----------+
| | | | | |
+--------------------------------------+------------+-----------+---------+----------+
| Revenue | 10,421 | 13,574 | - | 23,995 |
+--------------------------------------+------------+-----------+---------+----------+
| Cost of sales | (2,868) | (3,509) | - | (6,377) |
+--------------------------------------+------------+-----------+---------+----------+
| Other operating expenses | (6,463) | (8,530) | (2,232) | (17,225) |
+--------------------------------------+------------+-----------+---------+----------+
| Share option charge | - | - | (54) | (54) |
+--------------------------------------+------------+-----------+---------+----------+
| Segment operating profit / (loss) | 1,090 | 1,535 | (2,286) | 339 |
+--------------------------------------+------------+-----------+---------+----------+
| | | | | |
+--------------------------------------+------------+-----------+---------+----------+
+---------------------------------------+------------+-----------+---------+----------+
| 12 months ending 31 December 2008 | Restaurant | Piccolino | Other | Total |
| | Bar and | | | |
| | Grill | | | |
+---------------------------------------+------------+-----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------------+------------+-----------+---------+----------+
| | | | | |
+---------------------------------------+------------+-----------+---------+----------+
| Revenue | 22,281 | 30,191 | - | 52,472 |
+---------------------------------------+------------+-----------+---------+----------+
| Cost of sales | (5,862) | (7,466) | - | (13,328) |
+---------------------------------------+------------+-----------+---------+----------+
| Other operating expenses | (13,252) | (18,826) | (4,346) | (36,424) |
+---------------------------------------+------------+-----------+---------+----------+
| Increase in onerous lease provision | - | (500) | - | (500) |
+---------------------------------------+------------+-----------+---------+----------+
| Reversal of impairment of non-current | 996 | - | - | 996 |
| assets | | | | |
+---------------------------------------+------------+-----------+---------+----------+
| Impairment of non-current assets | - | (996) | - | (996) |
+---------------------------------------+------------+-----------+---------+----------+
| Share option charge | - | - | (108) | (108) |
+---------------------------------------+------------+-----------+---------+----------+
| Segment operating profit / (loss) | 4,163 | 2,403 | (4,454) | 2,112 |
+---------------------------------------+------------+-----------+---------+----------+
| | | | | |
+---------------------------------------+------------+-----------+---------+----------+
5. Earnings per share
The calculation of earnings per share (basic and diluted) is based on Group
profit after taxation and the weighted number of ordinary shares.
+---------------------------------------------+-----------+----------+-----------+
| | 6 months ended 28 June 2009 |
+---------------------------------------------+----------------------------------+
| | Earnings | Weighted | Per share |
| | | average | |
| | | number | |
| | | of | |
| | | shares | |
+---------------------------------------------+-----------+----------+-----------+
| | GBP'000 | '000 | Pence |
+---------------------------------------------+-----------+----------+-----------+
| | | | |
+---------------------------------------------+-----------+----------+-----------+
| Basic and diluted EPS | (838) | 39,502 | (2.1) |
+---------------------------------------------+-----------+----------+-----------+
+---------------------------------------------+-----------+----------+-----------+
| | 6 months ended 29 June 2008 |
+---------------------------------------------+----------------------------------+
| | Earnings | Weighted | Per share |
| | | average | |
| | | number | |
| | | of | |
| | | shares | |
+---------------------------------------------+-----------+----------+-----------+
| | GBP'000 | '000 | Pence |
+---------------------------------------------+-----------+----------+-----------+
| | | | |
+---------------------------------------------+-----------+----------+-----------+
| Basic EPS | 146 | 37,479 | 0.4 |
+---------------------------------------------+-----------+----------+-----------+
| Effect of share options | - | 2,570 | - |
+---------------------------------------------+-----------+----------+-----------+
| Diluted EPS | 146 | 40,049 | 0.4 |
+---------------------------------------------+-----------+----------+-----------+
+---------------------------------------------+-----------+----------+-----------+
| |12 months ended 31 December 2008 |
+---------------------------------------------+----------------------------------+
| | Earnings | Weighted | Per share |
| | | average | |
| | | number | |
| | | of | |
| | | shares | |
+---------------------------------------------+-----------+----------+-----------+
| | | | |
+---------------------------------------------+-----------+----------+-----------+
| | GBP'000 | '000 | Pence |
+---------------------------------------------+-----------+----------+-----------+
| | | | |
+---------------------------------------------+-----------+----------+-----------+
| Basic and diluted EPS | 516 | 38,490 | 1.3 |
+---------------------------------------------+-----------+----------+-----------+
The outstanding options at 31 December 2008 and 28 June 2009 do not have a
dilutive effect on the weighted average number of shares as the exercise price
of the options during the year exceeded the average market price of ordinary
shares.
6. Taxation
The taxation relates entirely to movements in deferred tax in each period and
there were no amounts in relation to corporation tax.
7. Copies of interim report
Copies of the interim report are available from the Company Secretary,
Individual Restaurant Company Plc, 4th Floor, Ridgefield House, 14 John Dalton
Street, Manchester M2 6JR.
8. Share capital
+----------------------------------------------+----------+-----------+----------+
| Denomination | Number | |
+---------------------------------------------------------+-----------+----------+
| Authorised share capital | GBP | '000 | GBP'000 |
+----------------------------------------------+----------+-----------+----------+
| Ordinary shares | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 1 January 2008/29 June 2008 and 31 | 0.35 | 76,273 | 26,696 |
| December 2008 | | | |
+----------------------------------------------+----------+-----------+----------+
| Share sub-division (6 for 1) | 0.05 | 457,641 | - |
+----------------------------------------------+----------+-----------+----------+
| Conversion to deferred shares | 0.05 | (237,013) | (11,851) |
+----------------------------------------------+----------+-----------+----------+
| As at 28 June 2009 | 0.05 | 296,901 | 14,845 |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| | GBP | '000 | GBP'000 |
+----------------------------------------------+----------+-----------+----------+
| Deferred shares | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 1 January 2008/29 June 2008 and 31 | - | - | - |
| December 2008 | | | |
+----------------------------------------------+----------+-----------+----------+
| Conversion of Ordinary shares | 0.05 | 237,013 | 11,851 |
+----------------------------------------------+----------+-----------+----------+
| Share cancellation | 0.05 | (237,013) | (11,851) |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 28 June 2009 | 0.05 | - | - |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
+----------------------------------------------+----------+-----------+----------+
| Denomination | Number | |
+---------------------------------------------------------+-----------+----------+
| Allotted and fully paid up share capital | GBP | '000 | GBP'000 |
+----------------------------------------------+----------+-----------+----------+
| Ordinary shares | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 1 January 2008 | 0.35 | 35,456 | 12,409 |
+----------------------------------------------+----------+-----------+----------+
| Issue of deferred consideration shares | 0.35 | 4,046 | 1,417 |
+----------------------------------------------+----------+-----------+----------+
| As at 29 June 2008 and 31 December 2008 | 0.35 | 39,502 | 13,826 |
+----------------------------------------------+----------+-----------+----------+
| Share sub-division (6 for 1) | 0.05 | 237,013 | - |
+----------------------------------------------+----------+-----------+----------+
| Conversion to deferred shares | 0.05 | (237,013) | (11,851) |
+----------------------------------------------+----------+-----------+----------+
| As at 28 June 2009 | 0.05 | 39,502 | 1,975 |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| | GBP | '000 | GBP'000 |
+----------------------------------------------+----------+-----------+----------+
| Deferred shares | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 1 January 2008/29 June 2008 and 31 | - | - | - |
| December 2008 | | | |
+----------------------------------------------+----------+-----------+----------+
| Conversion of Ordinary shares | 0.05 | 237,013 | 11,851 |
+----------------------------------------------+----------+-----------+----------+
| Share cancellation | 0.05 | (237,013) | (11,851) |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
| As at 28 June 2009 | 0.05 | - | - |
+----------------------------------------------+----------+-----------+----------+
| | | | |
+----------------------------------------------+----------+-----------+----------+
8. Share capital (continued)
At the AGM held on 21 May 2009:
* Each of the 36,771,300 authorised but as yet unissued ordinary shares of 35
pence each in the capital of the company were sub-divided into 257,399,100
Ordinary shares of 5p each.
* Each of the 39,502,160 issued Ordinary shares of 35 pence each were sub-divided
into 39,502,160 Ordinary shares of 5 pence each and 237,012,960 deferred shares
of 5 pence each.
On 19 June 2009 the company acquired all of the 237,012,960 deferred shares of 5
pence each for GBPNil
consideration. These shares were subsequently cancelled.
The resulting reduction in share capital of GBP11,851,000 was transferred to the
capital redemption reserve on cancellation.
During the period to 29 June 2008, 4,045,713 Ordinary shares were issued to
settle the deferred
consideration due in respect of the purchase of the entire share capital of
Individual Restaurant Company Limited.
9. Events after the balance sheet date
On 9th July 2009 16,195,885 ordinary shares of 5p each were allotted following
the open offer of shares announced to shareholders on 22nd June 2009. This
represented 100% of the open offer shares available.
On 9th July 2009 the company placed a further 3,950,216 of its ordinary shares
of 5p each with Blackstar (Isle of Man) Limited (in its capacity as trustee of
the Tarsem Singh Dhaliwal EFRBS and as trustee of the Andrew Simon Pritchard
EFRBS)
On 3rd August 2009 the Company announced the closure of its Piccolino site at
Wandsworth to be used in the future as a training and development centre for the
Piccolino brand. The book value of the site has already been written down in the
financial statements to 31 December 2008.
Independent review report to Individual Restaurant
Introduction
We have been engaged by the company to review the financial information in the
half-yearly financial report for the six months ended 28 June 2009 which
comprises the consolidated income statement, consolidated statement of
comprehensive income, consolidated statement of financial position, consolidated
statement of changes in equity, consolidated cashflow statement and the notes.
We have read the other information contained in the half yearly financial report
which comprises only the highlights and Chairman's statement and considered
whether it contains any apparent misstatements or material inconsistencies with
the information in the condensed set of financial statements.
This report is made solely to the company in accordance with guidance contained
in ISRE (UK and Ireland) 2410, 'Review of Interim Financial Information
performed by the Independent Auditor of the Entity'. Our review work has been
undertaken so that we might state to the company those matters we are required
to state to them in a review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the company, for our review work, for this report, or for the
conclusion we have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been approved
by, the directors. The AIM rules of the London Stock Exchange require that the
accounting policies and presentation applied to the financial information in the
half-yearly financial report are consistent with those which will be adopted in
the annual accounts having regard to the accounting standards applicable for
such accounts.
As disclosed in Note 2, the annual financial statements of the group are
prepared in accordance with IFRSs as adopted by the European Union. The
financial information in the half-yearly financial report has been prepared in
accordance with the basis of preparation in Note 2.
Our Responsibility
Our responsibility is to express to the Company a conclusion on the financial
information in the half-yearly financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity' issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe
that the financial information in the half-yearly financial report for the six
months ended 28 June 2009 is not prepared, in all material respects, in
accordance with the basis of accounting described in Note 2.
GRANT THORNTON UK LLP
AUDITOR
LIVERPOOL
27 September 2009
This information is provided by RNS
The company news service from the London Stock Exchange
END
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