TIDMDTG
RNS Number : 5782T
Dart Group PLC
21 November 2013
DART GROUP PLC
Interim Results
Dart Group PLC, the Leisure Airline, Package Holidays and
Distribution & Logistics Group (the "Group"), announces its
interim results for the half year ended 30 September 2013. These
results are presented under International Financial Reporting
Standards (IFRS).
Financial Highlights 2013 2012 Change
Group revenue GBP787.1m GBP584.5m +35%
Group operating profit GBP81.2m GBP58.5m +39%
Overall operating margin 10.3% 10.0% +0.3%
-------------------------- ---------- ---------- -------
Profit before tax GBP78.1m GBP57.0m +37%
Basic earnings per share 41.51p 30.11p +38%
Half year dividend 0.60p 0.54p +11%
-------------------------- ---------- ---------- -------
-- Group revenue increased 35% to GBP787.1m (2012: GBP584.5m)
whilst profit before tax increased 37% to GBP78.1m (2012: GBP57.0m)
underpinned by continued strong growth in both the Leisure Airline
and Package Holiday businesses.
-- Leisure Airline revenue growth of 19% to GBP463.2m (2012:
GBP388.0m) reflects a 13% increase in passengers flown and
increases in ticket yields and non-ticket retail revenues.
-- Package Holidays achieved 110% growth in revenues to
GBP380.1m (2012: GBP180.6m), with customer numbers increasing by
103% to 634,866.
-- Distribution & Logistics contributed GBP78.2m of revenues (2012: GBP80.3m).
-- With our Leisure Travel operations becoming increasingly
seasonal as we continue to grow the business, winter losses are
expected to increase materially. Accordingly, with the important
winter booking period still to come, the Board remains cautiously
optimistic in relation to full year profit growth.
Chairman's Statement
I am pleased to report on the Group's performance for the six
months ended 30 September 2013 in our three businesses, Jet2.com,
the North's leading leisure airline, Jet2holidays, the ATOL
protected package holidays operator and Fowler Welch, one of the
UK's leading logistics providers. Group profit before tax increased
37% to GBP78.1m (2012: GBP57.0m) whilst overall Group turnover
increased by 35% to GBP787.1m (2012: GBP584.5m). The increase in
profitability reflects a satisfactory summer for Jet2.com,
underpinned by the continued successful growth of the Jet2holidays
business. Our leisure travel operations continue to concentrate on
the Mediterranean, the Canary Islands and European Leisure Cities,
which means that the business is becoming increasingly seasonal as
it continues to grow and, as a result, increased losses are to be
expected in the second half of the year.
The Group generated an increased net cash flow from operating
activities of GBP89.5m (2012: GBP81.0m), reflecting further trading
performance improvements and business growth in both Jet2.comand
Jet2holidays, together with increased Jet2holidays forward
bookings. Total capital expenditure amounted to GBP42.7m (2012:
GBP26.1m) as two aircraft were acquired in the period together with
spend incurred on group infrastructure and the enhancement and long
term maintenance of the Group's aircraft fleet.
Cash and money market deposits increased by GBP48.9m in the
period (2012: GBP54.8m), resulting in a balance of GBP269.8m (2012:
GBP206.8m) at the end of the half year, which included advance
payments from Jet2.comand Jet2holidayscustomers of circa GBP134m
(2012: GBP98m).
Basic earnings per share increased to 41.51p from 30.11p. In
view of the outlook for the full year the Board has decided to pay
an increased interim dividend of 0.60p per share (2012: 0.54p). The
dividend will be paid on 3 February 2014 to shareholders on the
register at 3 January 2014.
Leisure Airline
Our Leisure Airline, Jet2.com, increased its flown passengers by
13.1% to 4.1m in the period (2012: 3.6m) and revenues by 19.4% to
GBP463.2m. This growth was driven by an increase in Jet2holidays
passenger numbers which represented 31% of all passengers flown
(2012: 17%). The average load factor increased from 91.6% to 92.5%
as passenger growth outstripped the seat capacity growth of 12%.
Despite challenging market conditions, ticket yields (excluding
government taxes) increased by 9.2%, as more emphasis was placed on
higher yielding Mediterranean and Canary Island destinations.
Retail revenue (non-ticket revenue) per passenger increased by 7.8%
due to a continued focus on pre-departure, in-flight and ancillary
product sales. As a result, Jet2.com's operating profit margin
ended the half ahead of last year.
During summer 2013 the company operated 53 aircraft (2012: 44)
focusing on core high volume leisure destinations from its eight
Northern UK bases - Belfast International, Blackpool, East
Midlands, Edinburgh, Glasgow, Leeds Bradford, Manchester and
Newcastle airports.
For winter 2013/14, Jet2.com has increased its scheduled
capacity by 23%, reducing Charter activity in the process, with
growth provided by additional scheduled flights to Mediterranean
and Canary Island destinations.
Capacity for summer 2014 is to grow by a further 14% (summer
2013: 12%) with additional services from each of our bases, which
will increase frequency and support the growth of both Jet2.com and
Jet2holidays. In total we have added 26 new services, including
three new destinations - Fuerteventura, Verona and Vienna for next
year.
Package Holidays
Our ATOL protected tour operator, Jet2holidays, grew its
customer numbers by 103%, as 634,866 customers enjoyed our package
holidays in the period. As a result, revenue increased by 110% to
GBP380.1m (2012: GBP180.6m). This growth continues to be fuelled by
further improvements to the Jet2holidays product range and a fully
integrated approach with Jet2.com, underpinned by a relentless
focus on providing a great value offering to our Northern based
customers.
Our customers continue to demand great value but are not willing
to reduce quality. Therefore, our holidays are ideally suited to
the current difficult economic environment as we offer packages
encompassing flights, transfers and accommodation ranging from
budget self catering, to five star luxury hotels, with all
inclusive and three and four star packages being particularly
popular.
For summer 2014 we are continuing to build product and brand
awareness in our core markets. These actions, together with the
development of our overall product range and focused growth in
airline capacity to our popular leisure destinations, will support
the continuing growth of Jet2holidays.
Distribution & Logistics
Fowler Welch is one of the UK's leading logistics providers to
the food industry supply chain, serving retailers, growers,
importers and manufacturers across its network of eleven sites. A
full range of added value services is provided including storage,
case level picking and an award-winning national distribution
network.
Overall revenues decreased by 2.6%, primarily as a result of
contract losses towards the end of last financial year, which has
led to the decision to close our European operating base in
Holland. The business was also adversely affected by the
unexpectedly varied profile of seasonal volumes required by our
supermarket customers during late July, August and September, which
required extra resource to uphold service levels. This, together
with investments made in people and infrastructure to support
future sustainable profit growth, meant that operating profits
reduced as compared to the first half of 2012/13.
Growth opportunities remain positive with Heywood, our ambient
shared user storage and distribution site in Greater Manchester,
revenues up 3% and additional contracts secured for implementation
toward the end of the current financial year. The key produce
distribution sites of Spalding, Kent and Hilsea have buoyant
pipelines. New contracted volume has been secured for Spalding
commencing early next financial year whilst a broader set of
services tailored to the produce sector are planned to commence in
the next six months in Kent. The additional warehouse space secured
at Hilsea at the end of the last financial year will see a new
storage and picking contract implemented in the second half.
Though the marketplace remains extremely competitive and
price-focused, the outlook for Fowler Welch remains encouraging
through its well positioned national network of sites, the focus on
its core activities of added value services and its growing
reputation in the ambient arena.
Outlook
Whilst the Group's trading performance during the first six
months of the year has been satisfactory, our leisure travel
operations are becoming increasingly seasonal as we continue to
grow the business and winter losses are expected to increase
materially. Accordingly, with the important winter booking period
still to come, the Board remains cautiously optimistic in relation
to profit growth for the financial year ending 31 March 2014.
Philip Meeson
Chairman
21 November 2013
For further information please contact:
Dart Group PLC Tel: 0113 239 7817
Philip Meeson, Group Chairman and Chief Mob: 07785 258666
Executive
Gary Brown, Group Chief Financial Officer Mob: 07739 208969
Smith & Williamson Corporate Finance Tel: 020 7131 4000
Limited
Nominated Adviser
Andy Pedrette / Siobhan Sergeant
Canaccord Genuity - Joint Broker Tel: 020 7523 8000
Peter Stewart / Mark Whitmore
Arden Partners - Joint Broker Tel: 020 7614 5900
Christopher Hardie
Buchanan - Financial PR Tel: 020 7466 5000
Richard Oldworth
Dart Group PLC
Consolidated Group Income Statement (unaudited)
For the half year ended 30 September 2013
Half year Half year Year ended
ended 30 ended 31 March
September 30 September 2013
2013 2012 Audited
Unaudited Unaudited
Continuing operations Note GBPm GBPm GBPm
------------ --------------- -------------
Turnover 4 787.1 584.5 869.2
Net operating expenses (705.9) (526.0) (831.3)
Operating profit 81.2 58.5 37.9
Finance income 0.8 1.0 3.6
Finance costs (3.9) (2.5) (1.0)
------------ --------------- -------------
Net financing costs (3.1) (1.5) 2.6
Profit before taxation 78.1 57.0 40.5
Taxation 7 (17.9) (13.9) (9.3)
------------ --------------- -------------
Profit for the period
(all attributable to
equity shareholders of
the parent company) 60.2 43.1 31.2
Earnings per share 5
- basic 41.51p 30.11p 21.73p
- diluted 40.75p 29.12p 21.44p
Dart Group PLC
Consolidated Group Statement of Comprehensive Income
(unaudited)
For the half year ended 30 September 2013
Half year Half year
ended ended Year ended
30 September 30 September 31 March
2013 2012 2013
Unaudited Unaudited Audited
GBPm GBPm GBPm
Profit for the period attributable
to equity holders of the
parent company 60.2 43.1 31.2
Effective portion of changes
in fair value movements in
cash flow hedges (14.4) (17.3) (3.3)
Net change in fair value
of effective cash flow hedges
transferred to profit (24.7) - -
Taxation on components of
other comprehensive income 9.0 4.1 0.6
-------------- -------------- -------------
Other comprehensive income
& expense for the period,
net of taxation (30.1) (13.2) (2.7)
Total comprehensive income
for the period attributable
to equity holders of the
parent company 30.1 29.9 28.5
============== ============== =============
Dart Group PLC
Consolidated Group Balance Sheet (unaudited)
As at 30 September 2013
30 September 30 September 31 March
2013 2012 2013
Unaudited Unaudited Audited
GBPm GBPm GBPm
Non-current assets
Goodwill 6.8 6.8 6.8
Property, plant and
equipment 276.9 236.7 269.1
Derivative financial
instruments 1.5 0.4 1.0
285.2 243.9 276.9
------------- ------------- ---------
Current assets
Inventories 2.2 1.1 1.3
Trade and other receivables 140.7 105.6 226.2
Derivative financial
instruments 2.6 6.2 22.2
Money market deposits 19.0 6.0 30.0
Cash and cash equivalents 250.8 200.8 190.9
415.3 319.7 470.6
------------- ------------- ---------
Total assets 700.5 563.6 747.5
------------- ------------- ---------
Current liabilities
Trade and other payables 183.1 159.1 92.0
Deferred revenue 224.7 159.8 407.1
Borrowings 0.8 0.8 0.8
Provisions 2.4 3.0 2.1
Derivative financial
instruments 22.1 5.3 4.2
433.1 328.0 506.2
------------- ------------- ---------
Non-current liabilities
Other non-current liabilities 8.9 11.5 11.4
Borrowings 9.4 8.1 7.7
Derivative financial
instruments 8.2 1.1 0.3
Deferred tax liabilities 23.5 25.6 35.3
------------- ------------- ---------
50.0 46.3 54.7
------------- ------------- ---------
Total liabilities 483.1 374.3 560.9
Net assets 217.4 189.3 186.6
============= ============= =========
Shareholders' equity
Share capital 1.8 1.8 1.8
Share premium 11.2 10.1 10.7
Cash flow hedging reserve (17.7) 1.9 12.4
Retained earnings 222.1 175.5 161.7
---------
Total shareholders'
equity 217.4 189.3 186.6
============= ============= =========
Dart Group PLC
Consolidated Group Cash Flow Statement (unaudited)
For the half year ended 30 September 2013
Half year Half year
ended 30 ended 30 Year ended
September September 31 March
2013 2012 2013
Unaudited Unaudited Audited
GBPm GBPm GBPm
Cash flows from operating
activities
Profit on ordinary activities
before taxation 78.1 57.0 40.5
Adjustments for:
Finance income (0.8) (1.0) (3.6)
Finance costs 3.9 2.5 1.0
Depreciation 34.9 24.1 45.5
Equity settled share based
payments 0.2 0.2 0.4
Operating cash flows before
movements in working capital 116.3 82.8 83.8
(Increase) / decrease in inventories (0.9) 0.3 0.1
Decrease / (increase) in trade
and other receivables 85.1 11.8 (108.5)
Increase in trade and other payables 73.5 82.4 29.2
(Decrease) / increase in deferred
revenue (182.4) (97.0) 150.3
Increase in provisions 0.4 1.3 0.4
Cash generated from operations 92.0 81.6 155.3
Interest received 0.7 1.0 1.4
Interest paid (0.6) (0.5) (1.1)
Income taxes paid (2.6) (1.1) (5.3)
Net cash from operating activities 89.5 81.0 150.3
----------- ----------- -----------
Cash flows from investing
activities
Purchase of property, plant and
equipment (42.7) (26.1) (79.7)
Net decrease in money market
deposits 11.0 71.0 47.0
Net cash (used in) / from
investing activities (31.7) 44.9 (32.7)
----------- ----------- -----------
Cash flows from financing
activities
Repayment of borrowings (8.3) (0.4) (0.8)
New loans advanced 10.0 - -
Proceeds on issue of shares 0.5 0.3 0.9
Equity dividends paid - - (2.1)
Net cash from / (used in) financing
activities 2.2 (0.1) (2.0)
----------- ----------- -----------
Effect of foreign exchange
rate changes (0.1) - 0.3
Net increase in cash in the period 59.9 125.8 115.9
Cash and cash equivalents at
beginning of period 190.9 75.0 75.0
Cash and cash equivalents
at end of period 250.8 200.8 190.9
=========== =========== ===========
Dart Group PLC
Consolidated Group Statement of Changes in Equity
(unaudited)
For the half year ended 30 September 2013
Cash flow
Share Share hedging Retained Total
capital premium reserve earnings reserves
GBPm GBPm GBPm GBPm GBPm
--------- --------- ---------- ---------- ----------
Balance at 1 April 2012 1.8 9.8 15.1 132.2 158.9
Total comprehensive income
for the period - - (13.2) 43.1 29.9
Share based payments - - - 0.2 0.2
Issue of share capital - 0.3 - - 0.3
Balance at 30 September
2012 1.8 10.1 1.9 175.5 189.3
Total comprehensive income
for the period - - 10.5 (11.9) (1.4)
Dividends paid in the
period - - - (2.1) (2.1)
Share based payments - - - 0.2 0.2
Issue of share capital - 0.6 - - 0.6
Balance at 31 March 2013 1.8 10.7 12.4 161.7 186.6
Total comprehensive income
for the period - - (30.1) 60.2 30.1
Share based payments - - - 0.2 0.2
Issue of share capital - 0.5 - - 0.5
Balance at 30 September
2013 1.8 11.2 (17.7) 222.1 217.4
========= ========= ========== ========== ==========
Dart Group PLC
Notes to the consolidated financial statements
For the half year ended 30 September 2013 (unaudited)
1. General information
The accounts for Dart Group PLC (the "Group") have been prepared
and approved by the Directors in accordance with International
Financial Reporting Standards ("IFRS") as adopted by the European
Union ("Adopted IFRS"). The Group's accounts consolidate the
accounts of Dart Group PLC and its subsidiaries.
This interim financial report does not fully comply with IAS 34
"Interim Financial Reporting", which is not currently required to
be applied by AIM companies.
The interim report for the six months ended 30 September 2013
was approved by the Board of Directors on 14 November 2013.
2. Accounting policies
Basis of preparation of the interim report
The unaudited consolidated interim financial report for the six
months ended 30 September 2013 does not constitute statutory
accounts as defined in s435 of the Companies Act 2006. The accounts
for the year ended 31 March 2013 were prepared under IFRS and have
been delivered to the Register of Companies. The report of the
auditor on those accounts was unqualified, did not contain an
emphasis of matter paragraph and did not contain any statement
under s495(2) nor (3) of the Companies Act 2006. In this report,
the comparative figures for the year ended 31 March 2013 have been
audited. The comparative figures for the period ended 30 September
2012 are unaudited.
The financial statements have been prepared under the historical
cost convention except for all derivative financial instruments
that have been measured at fair value.
The Group uses forward foreign currency contracts, currency
option products and aviation fuel swaps to hedge exposure to
foreign exchange rates and aviation fuel price volatility. The
Group also uses forward EU Allowance contracts and forward
Certified Emissions Reduction contracts to hedge exposure to Carbon
Emissions Allowance volatility. Such derivative financial
instruments are stated at fair value.
Ineffectiveness in qualifying cash flow hedges under IAS 39 can
arise as a result of the difference between the contractual profile
of a hedge and the profile of transactions defined as the hedged
item. IAS 39 requires ineffectiveness in qualifying cash flow
hedges to be recorded in the income statement.
The Group's accounts are presented in pounds sterling and all
values are rounded to the nearest GBP100,000 except where indicated
otherwise.
Going concern
The Directors have prepared financial forecasts for the Group,
comprising operating profit, balance sheet and cash flows through
to 31 March 2016.
For the purposes of their assessment of the appropriateness of
the preparation of the Group's unaudited interim accounts on a
going concern basis, the Directors have considered the current cash
position, the availability of bank facilities, the net current
liability position - principally a result of continued investment
in our fleet - and forecasts of future trading.
The Directors have assessed the current level of forward
bookings for the Leisure Airline and Package Holidays businesses,
Distribution & Logistics contracts and agreements, the
underlying assumptions and principal areas of uncertainty within
future forecasts, in particular those related to market and
customer risks which impact on future bookings, cost management,
working capital management and treasury risks. A number of these
assumptions are subject to market uncertainty and impact financial
covenants. Recognising this potential uncertainty, the Directors
have considered a range of actions available to mitigate the impact
of these potential risks should they crystallise and have also
reviewed the key strategies which underpin the forecast and the
Group's ability to implement them successfully.
On the basis of the current liquidity position, the current
Leisure Airline and Package Holidays forward booking profile,
Distribution & Logistics contracts and agreements, the
forecasts and these considerations, the Directors have assessed
future covenant compliance and headroom for the foreseeable future
and concluded that it is appropriate for the unaudited financial
statements for the period ended 30 September 2013 to be prepared on
a going concern basis.
3. Adoption of new and revised standards
The following new or revised IFRS standards and IFRIC
interpretations will be adopted for purposes of the preparation of
future financial statements, where applicable. We do not anticipate
that the adoption of these new or revised standards and
interpretations will have a material impact on our financial
position or results from operations.
Applies
to periods
International Financial beginning
Reporting Standards after
----------------------------- ------------
January
IFRS 9 Financial Instruments 2015
4. Segmental information
Business Segments
The Group's businesses are organised into three operating
segments:
-- Leisure Airline, comprising the Group's scheduled leisure airline, Jet2.com;
-- Package Holidays, comprising the Group's ATOL protected tour operator, Jet2holidays; and
-- Distribution & Logistics, comprising the Group's logistics company, Fowler Welch.
These divisions are the basis on which the Group reports its
primary segmental information in the day-to-day management of the
business. Following the identification of the operating segments
the Group has assessed the similarity of their characteristics.
Given the differences between them, it is not deemed appropriate to
aggregate them for reporting purposes and therefore all of the
identified operating segments are disclosed as reportable segments.
The following is an analysis of the Group's revenue by operating
segment.
Group eliminations include the removal of seat sales by Leisure
Airline to the Package Holidays business. Revenue from reportable
segments is measured on a basis consistent with the income
statement and is principally generated from within the UK, the
Group's country of domicile.
Segmental turnover Half year Half year
to to Year to
30 September 30 September 31 March
2013 2012 2013
Unaudited Unaudited Audited
GBPm GBPm GBPm
-------------- -------------- ----------
Leisure Airline 463.2 388.0 556.2
Package Holidays 380.1 180.6 244.8
Distribution & Logistics 78.2 80.3 155.2
Group eliminations (134.4) (64.4) (87.0)
Total turnover 787.1 584.5 869.2
============== ============== ==========
5. Earnings per share
The calculation of earnings per share is based on the
following:
Half year Half year
to to
30 September 30 September Year to
2013 2012 31 March
Unaudited Unaudited 2013 Audited
Profit for the period (GBPm) 60.2 43.1 31.2
-------------- -------------- --------------
Weighted average number
of ordinary shares in issue
during the period used to
calculate basic earnings
per share 145,021,355 143,112,650 143,618,691
Weighted average number
of ordinary shares in issue
during the period used to
calculate diluted earnings
per share 147,727,104 147,947,206 145,545,022
6. Dividends
An interim dividend has been proposed during the six month
period to 30 September 2013 of 0.60p per share (2012: 0.54p). The
dividend will be paid, out of the Company's available distributable
reserves, on 3 February 2014 to shareholders on the register at 3
January 2014. In accordance with IAS 1, dividends are recorded only
when paid and are shown as a movement in equity rather than as a
charge in the Income Statement.
7. Taxation
The tax charge for the period of GBP17.9m (2012: GBP13.9m) is
calculated by applying an estimated effective tax rate of 23% to
the profit for the period (2012: 24%). The Government has indicated
that it intends to enact future reductions in the main tax rate,
including a reduction to 21% by 1 April 2014. As a result, the
Group's reported deferred tax liability of GBP23.5m (2012:
GBP25.6m) would ultimately reduce by GBP2.0m to GBP21.5m.
8. Reconciliation of net cash flow to movement in net cash
Half year Half year
to to Year to
30 September 30 September 31 March
2013 2012 2013
Unaudited Unaudited Audited
GBPm GBPm GBPm
Increase in cash in
the period 59.9 125.8 115.9
(Increase) / decrease
in net debt in the period (1.7) 0.4 0.8
-------------- -------------- ----------
Change in net cash resulting
from cash flows in the
period 58.2 126.2 116.7
Net cash at beginning
of period 182.4 65.7 65.7
Net cash at end of period 240.6 191.9 182.4
============== ============== ==========
9. Contingent liabilities
The Group has issued various guarantees in the ordinary course
of business, none of which are expected to lead to a financial gain
or loss.
10. Other matters
This report will be posted on the Group's website,
www.dartgroup.co.uk and copies are available from the Company
Secretary at the registered office of the Company, Low Fare Finder
House, Leeds Bradford International Airport, Leeds, LS19 7TU.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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