TIDMTBK
RNS Number : 1533J
Ted Baker PLC
25 March 2010
25 March 2010
Ted Baker PLC
Annual results for the 52 weeks ended 30 January 2010
Highlights
· Strong performance in an uncertain and challenging trading environment
· Retail sales up 15.4%
· New retail stores opened in Heathrow Terminal One, Boston, Dubai and
Melbourne
· Further retail store openings for the US planned for 2010 in Chicago,
Santa Monica, Phoenix and New York
Further openings also planned in Dubai and Sydney
· Wholesale sales in line with expectations
· Underlying licence income up 9.5%
· Proposed final dividend of 0.5p per share
+-------------------+-------------+-------------+----------------+
| | 2010 | 2009 | Change |
+-------------------+-------------+-------------+----------------+
| Group Revenue | GBP163.6m | GBP152.7m | 7.2% |
| | | | |
+-------------------+-------------+-------------+----------------+
| Profit Before Tax | GBP20.3m | GBP19.6m | 3.6% |
| and Impairment | | | |
+-------------------+-------------+-------------+----------------+
| Basic EPS before | 34.4p | 33.8p | 1.8% |
| impairment | | | |
+-------------------+-------------+-------------+----------------+
| Profit Before Tax | GBP19.5m | GBP17.8m | 9.8% |
| | | | |
+-------------------+-------------+-------------+----------------+
| Basic EPS | 32.6p | 29.6p | 10.1% |
| | | | |
+-------------------+-------------+-------------+----------------+
| Total Dividend | 17.15p | 16.65p | 3.0% |
| | | | |
+-------------------+-------------+-------------+----------------+
| Cash Balance | GBP13.7m | GBP4.7m | 194.0% |
| | | | |
+-------------------+-------------+-------------+----------------+
Commenting, Ray Kelvin, Founder and Chief Executive, said:
"The team at Ted Baker has delivered a strong result in what has been a
challenging trading environment and I would like to thank everyone for their
continuing hard work and dedication.
We have been encouraged by trading since the start of the current financial year
and the positive reaction from our customers to our Spring/Summer collections.
Whilst we believe that 2010 will be a difficult trading year, we remain well
placed to deal with the challenges and opportunities ahead. The brand is well
positioned globally, our collections continue to be well received by our
customers and we remain focussed on investing in our business through our
multi-channel distribution strategy."
+------------+---------------+
| Enquiries: | |
+------------+---------------+
| | |
+------------+---------------+
| Ted | Tel: |
| Baker | 020 |
| PLC | 7796 |
| | 4133 |
| | on 25 |
| | March |
| | 2010 |
| | only |
+------------+---------------+
| Ray | Tel: |
| Kelvin, | 020 |
| Chief | 7255 |
| Executive | 4800 |
| | thereafter |
+------------+---------------+
| Lindsay | |
| Page, | |
| Finance | |
| Director | |
+------------+---------------+
| | |
+------------+---------------+
| Hudson | Tel: |
| Sandler | 020 7796 4133 |
+------------+---------------+
| Michael | |
| Sandler | |
| / Kate | |
| Hough / | |
| Alex | |
| Brennan | |
+------------+---------------+
CHAIRMAN'S STATEMENT
I am delighted to report that Ted Baker has delivered a strong performance in an
uncertain and challenging trading environment. We had anticipated a tough year
and took the necessary actions to ensure that we were well placed to deal with
the expected challenges. We believe this year's performance is testament to the
strength of our brand and collections and our multi-channel distribution
strategy.
The retail division delivered a good result with sales up 15.4% on a 13.6%
increase in average retail square footage. Trading in the UK exceeded our
expectations, but trading overseas remained difficult.
As anticipated, wholesale sales were down 21.2%. We estimate that around a
quarter of this decline was due to the transfer of selected wholesale accounts
to retail concessions, a third due to the closure of certain accounts that are
no longer appropriate for our brand and the balance due to the difficult trading
conditions experienced by some of our wholesale customers.
Licence income was in line with last year at GBP5.5m, although excluding the
impact of Hartmarx Corporation, underlying licence income was up 9.5%.
Results
Group revenue increased by 7.2% to GBP163.6m (2009: GBP152.7m) for the 52 weeks
ended 30 January 2010. Profit before tax and impairment increased by 3.6% to
GBP20.3m (2009: GBP19.6m) and profit before tax increased by 9.8% to GBP19.5m
(2009: GBP17.8m).
Basic earnings per share before impairment increased by 1.8% to 34.4p (2009:
33.8p) and basic earnings per share increased by 10.1% to 32.6p (2009: 29.6p).
The Group has a strong balance sheet and continues to maintain its focus on cash
management. Net cash generated from operating activities during the period was
GBP21.1m (2009: GBP11.1m).
Dividends
On the 23 February 2010 the Board announced the payment of a second interim
dividend of 11.4p per ordinary share, which will be paid on 26 March 2010 to
holders on the register on 5 March 2010. The Board is recommending the payment
of a final dividend of 0.5p per share, making a total for the year of 17.15p per
share (2009: 16.65p per share), an increase of 3.0% on the previous year.
Subject to approval the final dividend will be paid on 18 June 2010 to those
shareholders on the register on 14 May 2010.
People
This strong performance would not have been possible without the dedicated,
innovative and creative culture of the Ted Baker team. The team's passion and
commitment is a key factor of our success and I would like to take this
opportunity to thank all my colleagues around the world for their contribution
during the year.
It was announced on the 14 July 2009 that David Hewitt, who had been a
Non-Executive Director since 1997, would be retiring from the Board. I would
like to thank David for his extraordinary contribution to Ted Baker over the
last 12 years. His retail and business experience has greatly benefited the
Company during its period of growth since the flotation and we all wish him a
long and healthy retirement.
Following David's retirement, David Bernstein succeeded him as the Senior
Non-Executive Director and Chairman of the Remuneration Committee. Ronald
Stewart was appointed Chairman of the Audit Committee and a member of the
Nomination and Remuneration Committees and I remain Chairman of the Nomination
Committee.
Current Trading and Outlook
Retail
Trading in the UK has started well and we are encouraged by the improvement in
recent months of our overseas markets. We continue to take advantage of
opportunities in the US market and will be opening further stores in the US, in
Chicago, Santa Monica, Phoenix and New York in the second half of the financial
year.
Wholesale
We anticipate that 2010 will be a challenging year for our UK wholesale
customers, although at this stage trading and forward order commitments are in
line with our expectations.
There are no further structural changes envisaged for this division in the
current year.
Following the termination of our licence agreement with Hartmarx Corporation
last year, we have strengthened our team in the US market and re-launched our US
wholesale business. We have been pleased by the reaction from the department
stores and independents and will continue to explore opportunities to develop
the brand further.
Licence Income
Our product and territorial licenses continue to perform in line with our
expectations. Our territorial licensee, RSH Limited, continues to expand the
Ted Baker brand across the Middle East and Asia and will be opening a further
store in Dubai, in the Dubai Marina Mall, in April. We will also be opening a
further store in Sydney, Australia with our joint venture partner in the
territory towards the end of the year.
Since the year end, we have taken over the retail operations of our two stores
in Hong Kong after our territorial licensing agreement with Li & Fung Group of
Companies was cancelled by mutual consent. The licence for the Ted Baker stores
in Taiwan, previously operated by Li & Fung Group, has been assumed by Yun San
Corporation, a leading distributor of designer fashion, footwear and eyewear in
Taiwan. All these stores continue to perform in line with our expectations and
the changes in licensing agreements will have no material impact upon our
trading and financial performance.
Group
The economic and political climate remains uncertain and we believe that 2010
will be a difficult trading year. Nevertheless, we have been encouraged by
trading at the start of the new financial year and the positive reaction from
our customers to our Spring/Summer collections.
We continue to take action to ensure our costs and commitments are controlled
and in line with the trends anticipated for 2010 and we believe that we are well
positioned to deal with the challenges and opportunities ahead.
We intend to make our next interim management statement, covering trading since
the start of the financial year, on the 15 June 2010.
Robert Breare
Non-Executive Chairman
25 March 2010
BUSINESS REVIEW
OUR BUSINESS
Ted Baker is a leading designer brand that operates through three main
distribution channels: retail; wholesale; and licensing. We offer a wide range
of collections including: Menswear; Womenswear; Global; Phormal; Endurance;
Born; Accessories; Lingerie and Underwear; Childrenswear; Fragrance and
Skinwear; Footwear; Eyewear; and Watches.
The brand has grown steadily from its origins as a single shirt specialist store
in Glasgow to the global business it is today. We distribute through our own and
licensed retail outlets, leading department stores and selected independents in
Europe, the US, the Middle East and Asia.
Our strategy is to become a leading global designer brand, based on three main
elements:
· considered expansion of the Ted Baker collections. We review our
collections continually to ensure we react to trends and meet our customers
expectations. In addition, we look for opportunities to extend the breadth of
collections and enhance our offer;
· controlled distribution through three main channels: retail; wholesale;
and licensing. We consider each new opportunity to ensure it is right for the
brand and will deliver margin led growth; and
· carefully managed development of overseas markets. We continue to manage
growth in existing territories while considering new territories for expansion.
Underlying our strategy is an emphasis on design, product quality and attention
to detail, which is delivered by the passion, commitment and dedication of our
teams, licence partners and wholesale customers ("trustees").
GLOBAL GROUP PERFORMANCE
Retail
The retail division delivered a strong performance with sales increasing by
15.4% to GBP136.5m (2009: GBP118.2m). Average retail square footage rose by
13.6% over the period to 210,238 sq ft (2009: 185,102 sq ft). At 30 January
2010, total retail square footage was 217,733 sq ft (2009: 202,206 sq ft),
representing an increase of 7.7% on the prior year. Retail sales per square foot
remained broadly level at GBP649 against GBP639 in the prior year.
The retail gross margin was 64.9% (2009: 63.2%). In the United Kingdom, the
gross margin benefited from less promotional activity in the second half of the
financial year. This was partially offset by a lower gross margin in our
overseas markets due to continued promotional activity in highly competitive
markets.
Retail operating costs were controlled in line with the increase in average
selling space. This, combined with the improvement in sales and gross margin,
resulted in an improvement in retail operating contribution from 16.0% to 18.3%.
Wholesale
As anticipated, wholesale sales were 21.2% below last year, at GBP27.1m (2009:
GBP34.4m). We estimate that around a quarter of this decline was due to the
transfer of selected wholesale accounts to retail concessions, a third due to
the closure of certain accounts that are no longer appropriate for our brand and
the balance due to the difficult trading conditions experienced by some of our
wholesale customers.
Wholesale gross margins were broadly in line with last year at 41.9% (2009:
42.5%). This slight reduction in the gross margin was due to sales to licence
partners, at lower than average margins, accounting for a higher proportion of
total wholesale sales.
Licence income
Ted Baker operates two types of licences: territorial licences covering the
Middle East, Asia, Australia and New Zealand; and product licences covering
perfume & fragrance, watches, footwear, eyewear, childrenswear and lingerie.
Licence income was in line with last year at GBP5.5m, although, this year did
not include a contribution from our former licence partner Hartmarx Corporation,
who filed for protection under Chapter 11 of the US Bankruptcy Code in January
2009. Underlying licence income was up 9.5% due to good performances across all
of our territorial and product licences.
As previously mentioned, since the year end we have taken over the retail
operations of our two stores in Hong Kong and are now working with Yun San
Corporation who have taken over the licence for our stores in Taiwan. These
stores performed in line with our expectations during the year and the change in
licensing agreements will have no material financial effects.
Collections
Ted Baker Menswear delivered a good performance over the year, particularly in
the run up to Christmas with sales up 1.6% to GBP88.4m (2009: GBP87.0m).
In August we announced the launch of Born by Ted Baker, our highly designed
men's casualwear collection and have been pleased with the response from our
customers. Menswear represented 54.0% of total sales for the year (2009:
57.0%).
Ted Baker Womenswear delivered a strong performance with sales up 14.5% to
GBP75.2m (2009: GBP65.7m) reflecting the growing strength of our Womenswear
collections. Womenswear represented 46.0% of total sales (2009: 43.0%). A
significant proportion of the increase in turnover was due to the transfer of
wholesale accounts to concessions, resulting in an improvement in performance.
GEOGRAPHIC PERFORMANCE
United Kingdom and Europe
Sales in our UK and Europe retail division were up 17.3% to GBP126.4m (2009:
GBP107.8m). Whilst the UK has performed ahead of our expectations, our European
stores have faced challenging conditions.
Average square footage rose by 14.7% over the period to 180,606 sq ft (2009:
157,393 sq ft). At 30 January 2010, total retail square footage was 186,024 sq
ft (2009: 174,148 sq ft) representing an increase of 6.8%. Retail sales per
square foot increased from GBP671 to GBP690.
During the period we opened one new store at Heathrow Terminal One. At 30
January 2010 we operated 33 stores (2009: 32), 151 concessions (2009: 124) and
10 outlet stores (2009: 10).
We continue to develop our e-commerce business and during the year completed a
series of further enhancements to our transactional website.
US
Trading conditions in the US continued to be very difficult during the year and
as a result, sales for the period were down 16.3% to $15.9m (2009: $19.0m).
These challenging conditions present us with an opportunity to take advantage of
the environment and expand our business in the US market.
In October we opened our first store in Boston and have been pleased with
initial trading and customer reactions. We also opened a further outlet store in
Orlando, Florida. Average square footage rose by 6.9% over the period to 29,632
sq ft (2009: 27,709 sq ft) and retail sales per square decreased from $686 to
$536. As at 30 January 2010 we operated 9 stores (2009: 8) and 2 outlet stores
(2009: 1).
Middle East, Asia and Australasia
We continue to develop the Ted Baker brand across the Middle East, Asia and
Australasia working closely with our partners in these territories to ensure the
visual merchandising of the stores and the training of the teams reflects the
Ted Baker culture.
As previously mentioned, we have taken over the retail operations of our two
stores in Hong Kong and are delighted to now be working with Yun San Corporation
in Taiwan.
Despite the difficult economic environment, trading across our stores was in
line with our expectations. During the year we opened a second store in Taipei,
in Taipei 101, which is performing very well and the total number of stores and
concessions in these territories is now 18.
Our first store in Melbourne Australia, which is operated through a joint
venture with our licence partner in the territory, traded well during the period
and we opened a second store in Chadstone, Melbourne in October. We have been
pleased by the performance to date and will continue to work with our licencee
in this market to develop further opportunities for the brand.
FINANCIAL REVIEW
Revenue and Gross Margin
Group revenue increased by 7.2% to GBP163.6m (2009: GBP152.7m) due to a 15.4%
increase in retail sales to GBP136.5m (2009: GBP118.2m) and a 21.2% decrease in
wholesale sales to GBP27.1m (2009: GBP34.4m), which was in line with our
expectations.
The composite gross margin for the Group increased to 61.1% (2009: 58.5%) as a
result of retail representing a greater proportion of our sales mix and retail
benefited from less promotional activity in the second half of the year
resulting in an increase in the underlying retail gross margin to 64.9% (2009:
63.2%). Wholesale gross margins decreased marginally to 41.9% (2009: 42.5%).
The composite gross margin in the United Kingdom increased to 62.7% (2009:
59.1%) for the reasons above, whereas the composite gross margin in other
territories fell to 47.6% (2009: 54.2%), due to continued promotional activity
in highly competitive markets.
Operating Expenses
Operating expenses excluding impairment rose by 11.9% to GBP85.0m (2009:
GBP75.9m). Excluding employee performance related bonus costs of GBP1.9m (2009:
GBPnil), operating expenses rose by 9.4%. Distribution costs, which include the
costs of retail stores, outlets and concessions, increased by 13.8% to GBP64.6m
(2009: GBP56.7m), which was in line with the increase in average retail selling
space. Administration expenses, excluding impairment and the employee
performance related bonus, decreased by 3.7% to GBP18.5m (2009: GBP19.2m)
demonstrating the actions we took in September 2008 to reduce costs.
Licence Income
Licence income was in line with last year at GBP5.5m, although, excluding
Hartmarx Corporation ("Hartmarx"), who filed for protection under Chapter 11 of
the US Bankruptcy Code in January 2009, underlying licence income increased by
9.5%. Our licence agreement with Hartmarx was terminated on 1 July 2009 and we
have subsequently signed new licence agreements directly with companies who
previously held product sub-licences with Hartmarx and with a Canadian
distributor previously contracted by Hartmarx.
We have not recognised the unpaid royalty income from Hartmarx for the period
October 2008 through to the termination of this agreement.
Profit Before Tax
Profit before tax and impairment grew by 3.6% to GBP20.3m (2009: GBP19.6m).
This result was after the payment of employee performance related bonuses of
GBP1.9m (2009: GBPnil), relating to the over achievement of internal targets in
the financial year.
Impairment Losses
The Group incurred a GBP0.8m impairment loss in relation to the carrying value
of retail assets in Eire. We have faced very challenging conditions in this
market and believe that the recovery period will be longer than our other
overseas markets. This accounting charge has no cash flow effect on the Group.
Finance Income and Expenses
Net interest payable during the year of GBP0.1m was in line with the prior year
(2009: GBP0.2m).
The foreign exchange loss during the year of GBP0.2m (2009: gain GBP0.7m) was
principally due to the effect of the weakening of both the US Dollar and the
Euro on the retranslation of monetary assets and liabilities denominated in
foreign currencies.
Taxation
The Group tax charge for the year was GBP6.0m (2009: GBP5.2m), an effective tax
rate of 30.6% (2009: 29.3%). The underlying tax rate (excluding impairment) was
29.5% and we expect our effective rate to remain at around 29.0%.
Cash Flow
Net cash generated from operating activities was GBP21.1m (2009: GBP11.1m). The
increase on the prior year is principally due to a decrease in working capital
as opposed to an increase in the prior year, but also reflected the increased
profit in the period and the benefit of foreign currency purchases hedged at
favourable rates.
Total working capital as per the Group balance sheet, which comprises
inventories, trade and other receivable and trade and other payables increased
by GBP0.4m to GBP28.4m (2009: GBP28.0m). The movement in working capital as per
the Group cash flow statement is lower due to translation differences.
Capital expenditure of GBP4.5m (2009: GBP11.8m) reflected the opening and
refurbishment of stores, concessions and outlets. The reduction in capital
expenditure reflected 15,527 sq ft of new retail space opened in the current
year against 36,945 sq ft in the prior year.
There were no own shares acquired during the year, whereas 500,000 own shares
were acquired during the prior year at a cost of GBP2.0m.
Shareholder Return
Basic earnings per share before impairment increased by 1.8% to 34.4p (2009:
33.8p) and basic earnings per share increased by 10.1% to 32.6p (2009: 29.6p).
A second interim dividend per share will be paid on 26 March 2010 at 11.4p per
share and a proposed final dividend of 0.5p per share will make a total for the
year of 17.15p per share (2009: 16.65p per share), an increase of 3.0% on the
previous year.
Free cash flow per share, which is calculated using the net cash generated from
activities, was 48.8p (2009: 26.0p).
Currency Management
The most significant exposure to foreign exchange fluctuation relates to
purchases made in foreign currencies, principally the US Dollar and the Euro.
A proportion of the Group's purchases are hedged in accordance with the Group's
risk management policy, typically 12 months in advance. The balance of
purchases is naturally hedged as the business operates internationally and
income is generated in the local currency.
At the balance sheet date, the Group had hedged its projected commitments in
respect of the year ending January 2011.
Borrowing Facilities
The Group has borrowing facilities of GBP15.0m (2009: GBP20.0m) available to it.
The facilities comprise an unsecured committed facility of GBP2.25m and a
revolving advance facility of GBP5.25m with the Royal Bank of Scotland PLC and
an uncommitted, unsecured multi-option facility of GBP7.5m with Barclays Bank
PLC.
At the balance sheet date, the borrowing facilities were unutilised.
Principal Risks and Uncertainties
The current unprecedented trading environment has affected, and will continue to
affect, all areas of our business. We also recognise that we will be affected by
the impact this will have on our customers, partners and suppliers.
The Board recognises there are a number of risks and uncertainties that face the
Group. The Board has established a structured approach to identify, assess and
manage these risks and this is regularly monitored and updated by the Risk
Committee. Although not exhaustive, the following list highlights some of the
main issues:
Strategic risks
Economic environment
Global, economic and financial factors affecting our suppliers, customers and
partners are monitored closely, ensuring that we are prepared for and can react
to changes in the environment.
Brand
We are a brand and we rely on our teams, trustees and partners to protect the
brand and ensure that it is presented in an appropriate way. This risk is
minimised by careful consideration of each new opportunity and each partner with
whom we do business.
As with all fashion brands there is a risk that our offer will not meet the
needs of our customers.
Operational risks
Cost inflation
We may face increases in our operating costs due to growth in payroll, property
and other costs, some of which may be outside the scope of our control.
Operating costs are monitored regularly to ensure that any cost increases are
quickly identified and appropriate action is taken.
Infrastructure
The risk of operational problems including disruption to the infrastructure that
supports our business are mitigated against through business continuity
planning, which is constantly updated by the Risk Committee, and insurance cover
for business disruption.
People
The Board recognises the importance of our teams within the business and has put
in place a structure that minimises reliance on key individuals.
IT security
The continuing growth of the business, both in the UK and overseas, and advances
in technology have resulted in more data being transmitted, posing an increased
security risk. There is also the possibility of unintentional loss of controlled
data by authorised users. Commitment of additional specialist resources and the
continual upgrading of security equipment and software mitigate these risks.
Financial risks
Currency risk
The Group uses financial instruments in order to manage the majority of its
exposures that arise from its business operations as a result of movements in
financial markets. An element of this exposure is mitigated through natural
hedges as the Group generates revenues in local currency in the United States
and Europe. Treasury activities are focused on the management and hedging of
risk. It is the Group's policy not to trade financial instruments or to engage
in speculative financial transactions. There have been no significant changes in
the Group's policies in the period.
The principal economic and market risks continue to be movements in foreign
currency exchange rates and interest rates. Exposures to these risks are managed
by the Group Treasury function which operates within written policies approved
by the Board and within the internal control framework.
Counterparty credit risk
Credit risk arises on credit exposure to wholesale customers including
outstanding receivables and committed transactions. However, this risk is
substantially mitigated by insurance being taken out up to the amount of the
credit limit.
The Group has an established policy for managing counterparty credit risk. A
common framework exists to measure, report and control exposures to
counterparties across the Group. The limits applied to each customer are set in
conjunction with our credit insurer's advice. Monitoring of credit limits is
undertaken on a daily basis.
The Group also faces the risk of counterparties to financial instruments not
performing accordance to the terms of a contract or instrument. This risk is
minimised by engaging only reputable banks or financial institutions and by
broadening our exposure to a number of different financial institutions.
Cautionary statement regarding forward-looking statements
This announcement contains certain forward-looking statements. These
forward-looking statements include matters that are not historical facts or are
statements regarding the Company's intentions, beliefs or current expectations
concerning, among other things, the Company's results of operations, financial
condition, liquidity, prospects, growth, strategies, and the industries in which
the Company operates. Forward-looking statements are based on the information
available to the Directors at the time of preparation of this announcement, and
will not be updated during the year. The Directors can give no assurance that
these expectations will prove to have been correct. Due to inherent
uncertainties, including both economic and business risk factors underlying such
forward looking information, actual results may differ materially from those
expressed or implied by these forward-looking statements.
Group Income Statement
For the 52 weeks ended 30 January 2010
+-----------------+--------+--------+----------+----------+
| | | | 52 | 53 |
| | | | weeks | weeks |
| | | | ended | ended |
| | Note | | 30 | 31 |
| | | | January | January |
| | | | 2010 | 2009 |
+-----------------+--------+--------+----------+----------+
| | | | GBP'000 | GBP'000 |
| | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| Revenue | 2 | | 163,586 | 152,661 |
+-----------------+--------+--------+----------+----------+
| Cost | | | (63,659) | (63,295) |
| of | | | | |
| sales | | | | |
+-----------------+--------+--------+----------+----------+
| Gross | | | 99,927 | 89,366 |
| profit | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| Distribution | | | (64,573) | (56,744) |
| costs | | | | |
+-----------------+--------+--------+----------+----------+
| Administrative | | | | |
| expenses | | | | |
+-----------------+--------+--------+----------+----------+
| - | | | (20,395) | (19,204) |
| Other | | | | |
| administrative | | | | |
| expenses | | | | |
+-----------------+--------+--------+----------+----------+
| - | 8 | | (750) | (1,786) |
| Impairment | | | | |
| losses | | | | |
+-----------------+--------+--------+----------+----------+
| Licence | | | 5,493 | 5,476 |
| income | | | | |
+-----------------+--------+--------+----------+----------+
| Other | | | 80 | 53 |
| operating | | | | |
| income | | | | |
+-----------------+--------+--------+----------+----------+
| Operating | | | 19,782 | 17,161 |
| profit | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| Finance | 4 | | 10 | 837 |
| income | | | | |
+-----------------+--------+--------+----------+----------+
| Finance | 4 | | (374) | (307) |
| expenses | | | | |
+-----------------+--------+--------+----------+----------+
| Share | | | 86 | 75 |
| of | | | | |
| profit | | | | |
| of | | | | |
| jointly | | | | |
| controlled | | | | |
| entity, | | | | |
| net of tax | | | | |
+-----------------+--------+--------+----------+----------+
| Profit | 3 | | 19,504 | 17,766 |
| before | | | | |
| tax | | | | |
+-----------------+--------+--------+----------+----------+
| Income | 5 | | (5,977) | (5,198) |
| tax | | | | |
| expense | | | | |
+-----------------+--------+--------+----------+----------+
| Profit | | | 13,527 | 12,568 |
| for | | | | |
| the | | | | |
| period | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| Attributable | | | | |
| to: | | | | |
+-----------------+--------+--------+----------+----------+
| Equity | | | 13,576 | 12,593 |
| shareholders | | | | |
| of the | | | | |
| parent | | | | |
| company | | | | |
+-----------------+--------+--------+----------+----------+
| Non-controlling | | | (49) | (25) |
| interest | | | | |
+-----------------+--------+--------+----------+----------+
| Profit | | | 13,527 | 12,568 |
| for | | | | |
| the | | | | |
| period | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| Earnings | | | | |
| per | | | | |
| share | | | | |
+-----------------+--------+--------+----------+----------+
| Basic | 6 | | 32.6p | 29.6p |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
| | | | | |
+-----------------+--------+--------+----------+----------+
The Income Statement relates to continuing operations
Consolidated Group Statement of Comprehensive Income
For the 52 weeks ended 30 January 2010
+----------------------------------------+------------+------------+
| | 52 weeks | 53 weeks |
| | ended 30 | ended 31 |
| | January | January |
| | 2010 | 2009 |
+----------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+----------------------------------------+------------+------------+
| | | |
+----------------------------------------+------------+------------+
| Profit for the period | 13,527 | 12,568 |
+----------------------------------------+------------+------------+
| | | |
+----------------------------------------+------------+------------+
| Other comprehensive income | | |
+----------------------------------------+------------+------------+
| | | |
+----------------------------------------+------------+------------+
| Net effective portion of changes in | (1,334) | 3,771 |
| fair value of cash flow hedges | | |
+----------------------------------------+------------+------------+
| Net change in fair value of cash flow | (391) | (2,309) |
| hedges transferred to profit or loss | | |
+----------------------------------------+------------+------------+
| Exchange rate movement | (1,058) | 1,702 |
+----------------------------------------+------------+------------+
| Other comprehensive income for the | (2,783) | 3,164 |
| period, net of tax | | |
+----------------------------------------+------------+------------+
| | | |
+----------------------------------------+------------+------------+
| Total comprehensive income for the | 10,744 | 15,732 |
| period | | |
+----------------------------------------+------------+------------+
| | | |
+----------------------------------------+------------+------------+
| Total comprehensive income | | |
| attributable to: | | |
+----------------------------------------+------------+------------+
| - Owners of the parent | 10,793 | 15,757 |
+----------------------------------------+------------+------------+
| - Non-controlling interest | (49) | (25) |
+----------------------------------------+------------+------------+
| Total comprehensive income for the | 10,744 | 15,732 |
| period | | |
+----------------------------------------+------------+------------+
Group Statement of Changes in Equity
For the 52 weeks ended 30 January 2010
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | Share | Share | Cash | Translation | Retained | Total | Non-controlling | Total |
| | capital | premium | flow | reserve | earnings | equity | interest | equity |
| | | | hedging | | | attributable | | |
| | | | reserve | | | to equity | | |
| | | | | | | shareholders | | |
| | | | | | | of the | | |
| | | | | | | parent | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Balance | 2,160 | 9,137 | 1,713 | 1,182 | 48,010 | 62,202 | (36) | 62,166 |
| at 31 | | | | | | | | |
| January | | | | | | | | |
| 2009 | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Profit | - | - | - | - | 13,576 | 13,576 | (49) | 13,527 |
| for | | | | | | | | |
| the | | | | | | | | |
| period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Deferred | - | - | (375) | - | - | (375) | - | (375) |
| tax | | | | | | | | |
| associated | | | | | | | | |
| with | | | | | | | | |
| movement | | | | | | | | |
| in hedging | | | | | | | | |
| reserve | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Effective | - | - | (959) | - | - | (959) | - | (959) |
| portion | | | | | | | | |
| of | | | | | | | | |
| changes | | | | | | | | |
| in fair | | | | | | | | |
| value of | | | | | | | | |
| cash flow | | | | | | | | |
| hedges | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Net | - | - | (391) | - | - | (391) | | (391) |
| change | | | | | | | | |
| in | | | | | | | | |
| fair | | | | | | | | |
| value | | | | | | | | |
| of | | | | | | | | |
| cash | | | | | | | | |
| flow | | | | | | | | |
| hedges | | | | | | | | |
| transferred | | | | | | | | |
| to profit | | | | | | | | |
| or loss | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Exchange | - | - | - | (1,058) | - | (1,058) | | (1,058) |
| rate | | | | | | | | |
| movement | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Total | - | - | (1,725) | (1,058) | 13,576 | 10,793 | (49) | 10,744 |
| comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Transactions | | | | | | | | |
| with owners | | | | | | | | |
| recorded | | | | | | | | |
| directly in | | | | | | | | |
| equity | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Share | - | - | - | - | 192 | 192 | - | 192 |
| options | | | | | | | | |
| / | | | | | | | | |
| awards | | | | | | | | |
| charge | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Movement | - | - | - | - | 13 | 13 | - | 13 |
| on | | | | | | | | |
| current | | | | | | | | |
| / | | | | | | | | |
| deferred | | | | | | | | |
| tax on | | | | | | | | |
| share | | | | | | | | |
| options | | | | | | | | |
| / awards | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Disposal | - | - | - | - | 43 | 43 | - | 43 |
| of | | | | | | | | |
| treasury | | | | | | | | |
| shares | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Dividends | - | - | - | - | (6,928) | (6,928) | - | (6,928) |
| paid | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Total | - | - | - | - | (6,680) | (6,680) | - | (6,680) |
| transactions | | | | | | | | |
| with owners | | | | | | | | |
| recorded | | | | | | | | |
| directly in | | | | | | | | |
| equity | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Balance | 2,160 | 9,137 | (12) | 124 | 54,906 | 66,315 | (85) | 66,230 |
| at 30 | | | | | | | | |
| January | | | | | | | | |
| 2010 | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
For the 53 weeks ended 31 January 2009
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | Share | Share | Cash | Translation | Retained | Total | Non-controlling | Total |
| | capital | premium | flow | reserve | earnings | equity | interest | equity |
| | | | hedging | | | attributable | | |
| | | | reserve | | | to equity | | |
| | | | | | | shareholders | | |
| | | | | | | of the | | |
| | | | | | | parent | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Balance | | 9,137 | 251 | (520) | 44,695 | 55,723 | (11) | 55,712 |
| at 26 | 2,160 | | | | | | | |
| January | | | | | | | | |
| 2008 | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Profit | - | - | - | - | 12,593 | 12,593 | (25) | 12,568 |
| for | | | | | | | | |
| the | | | | | | | | |
| period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Deferred | - | - | 375 | - | - | 375 | - | 375 |
| tax | | | | | | | | |
| associated | | | | | | | | |
| with | | | | | | | | |
| movement | | | | | | | | |
| in hedging | | | | | | | | |
| reserve | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Effective | - | - | 3,396 | - | - | 3,396 | - | 3,396 |
| portion | | | | | | | | |
| of | | | | | | | | |
| changes | | | | | | | | |
| in fair | | | | | | | | |
| value of | | | | | | | | |
| cash flow | | | | | | | | |
| hedges | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Net | - | - | (2,309) | - | - | (2,309) | - | (2,309) |
| change | | | | | | | | |
| in | | | | | | | | |
| fair | | | | | | | | |
| value | | | | | | | | |
| of | | | | | | | | |
| cash | | | | | | | | |
| flow | | | | | | | | |
| hedges | | | | | | | | |
| transferred | | | | | | | | |
| to profit | | | | | | | | |
| or loss | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Exchange | - | - | - | 1,702 | - | 1,702 | - | 1,702 |
| rate | | | | | | | | |
| movement | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Total | - | - | 1,462 | 1,702 | 12,593 | 15,757 | (25) | 15,732 |
| comprehensive | | | | | | | | |
| income for | | | | | | | | |
| the period | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Transactions | | | | | | | | |
| with owners | | | | | | | | |
| recorded | | | | | | | | |
| directly in | | | | | | | | |
| equity | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Share | - | - | - | - | (301) | (301) | - | (301) |
| options | | | | | | | | |
| / | | | | | | | | |
| awards | | | | | | | | |
| charge | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Movement | - | - | - | - | (44) | (44) | - | (44) |
| on | | | | | | | | |
| current | | | | | | | | |
| / | | | | | | | | |
| deferred | | | | | | | | |
| tax on | | | | | | | | |
| share | | | | | | | | |
| options | | | | | | | | |
| / awards | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Own | - | - | - | - | (2,014) | (2,014) | - | (2,014) |
| shares | | | | | | | | |
| acquired | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Disposal | - | - | - | - | 64 | 64 | - | 64 |
| of | | | | | | | | |
| treasury | | | | | | | | |
| shares | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Dividends | - | - | - | - | (6,983) | (6,983) | - | (6,983) |
| paid | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Total | - | - | - | - | (9,278) | (9,278) | - | (9,278) |
| transactions | | | | | | | | |
| with owners | | | | | | | | |
| recorded | | | | | | | | |
| directly in | | | | | | | | |
| equity | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
| Balance | 2,160 | 9,137 | 1,713 | 1,182 | 48,010 | 62,202 | (36) | 62,166 |
| at 31 | | | | | | | | |
| January | | | | | | | | |
| 2009 | | | | | | | | |
+---------------+---------+---------+---------+-------------+----------+--------------+-----------------+---------+
Group Balance Sheet
At 30 January 2010
+-----------------+--------+----------+----------+
| | Note | 30 | 31 |
| | | January | January |
| | | 2010 | 2009 |
| | | | |
+-----------------+--------+----------+----------+
| | | GBP'000 | GBP'000 |
+-----------------+--------+----------+----------+
| Non-current | | | |
| assets | | | |
+-----------------+--------+----------+----------+
| Intangible | | 634 | 673 |
| assets | | | |
+-----------------+--------+----------+----------+
| Property, | 8 | 25,508 | 28,701 |
| plant and | | | |
| equipment | | | |
+-----------------+--------+----------+----------+
| Investments | | 171 | 85 |
| in equity | | | |
| accounted | | | |
| investee | | | |
+-----------------+--------+----------+----------+
| Deferred | | 1,598 | 904 |
| tax | | | |
| assets | | | |
+-----------------+--------+----------+----------+
| Prepayments | | 842 | 961 |
+-----------------+--------+----------+----------+
| | | 28,753 | 31,324 |
+-----------------+--------+----------+----------+
| Current | | | |
| assets | | | |
+-----------------+--------+----------+----------+
| Inventories | | 33,450 | 37,315 |
+-----------------+--------+----------+----------+
| Trade | | 19,698 | 20,466 |
| and | | | |
| other | | | |
| receivables | | | |
+-----------------+--------+----------+----------+
| Amount | | 261 | 139 |
| due | | | |
| from | | | |
| equity | | | |
| accounted | | | |
| investee | | | |
+-----------------+--------+----------+----------+
| Derivative | | 280 | 2,444 |
| financial | | | |
| assets | | | |
+-----------------+--------+----------+----------+
| Cash | | 13,698 | 4,660 |
| and | | | |
| cash | | | |
| equivalents | | | |
+-----------------+--------+----------+----------+
| | | 67,387 | 65,024 |
+-----------------+--------+----------+----------+
| Current | | | |
| liabilities | | | |
+-----------------+--------+----------+----------+
| Trade | | (24,779) | (29,806) |
| and | | | |
| other | | | |
| payables | | | |
+-----------------+--------+----------+----------+
| Income | | (3,511) | (3,801) |
| tax | | | |
| payable | | | |
+-----------------+--------+----------+----------+
| Derivative | | (304) | - |
| financial | | | |
| liabilities | | | |
+-----------------+--------+----------+----------+
| | | (28,594) | (33,607) |
+-----------------+--------+----------+----------+
| | | | |
+-----------------+--------+----------+----------+
| Non-current | | | |
| liabilities | | | |
+-----------------+--------+----------+----------+
| Deferred | | (1,316) | (575) |
| tax | | | |
| liabilities | | | |
+-----------------+--------+----------+----------+
| | | (1,316) | (575) |
+-----------------+--------+----------+----------+
| | | | |
+-----------------+--------+----------+----------+
| Net | | 66,230 | 62,166 |
| assets | | | |
+-----------------+--------+----------+----------+
| | | | |
+-----------------+--------+----------+----------+
| Equity | | | |
+-----------------+--------+----------+----------+
| Share | | 2,160 | 2,160 |
| capital | | | |
+-----------------+--------+----------+----------+
| Share | | 9,137 | 9,137 |
| premium | | | |
| account | | | |
+-----------------+--------+----------+----------+
| Other | | (12) | 1,713 |
| reserves | | | |
+-----------------+--------+----------+----------+
| Translation | | 124 | 1,182 |
| reserve | | | |
+-----------------+--------+----------+----------+
| Retained | | 54,906 | 48,010 |
| earnings | | | |
+-----------------+--------+----------+----------+
| Total | | 66,315 | 62,202 |
| equity | | | |
| attributable | | | |
| to equity | | | |
| shareholders | | | |
| of the | | | |
| parent | | | |
| company | | | |
+-----------------+--------+----------+----------+
| Non-controlling | | (85) | (36) |
| interest | | | |
+-----------------+--------+----------+----------+
| Total | | 66,230 | 62,166 |
| equity | | | |
+-----------------+--------+----------+----------+
Group Cash Flow Statement
For the 52 weeks ended 30 January 2010
+--------------+---------+----------+
| | 52 | 53 |
| | weeks | weeks |
| | ended | ended |
| | 30 | 31 |
| | January | January |
| | 2010 | 2009 |
+--------------+---------+----------+
| | GBP'000 | GBP'000 |
+--------------+---------+----------+
| Cash | | |
| generated | | |
| from | | |
| operations | | |
+--------------+---------+----------+
| Profit | 13,527 | 12,568 |
| for | | |
| the | | |
| period | | |
+--------------+---------+----------+
| Adjusted | | |
| for: | | |
+--------------+---------+----------+
| Income | 5,977 | 5,198 |
| tax | | |
| expense | | |
+--------------+---------+----------+
| Depreciation | 6,295 | 5,990 |
+--------------+---------+----------+
| Impairment | 750 | 1,786 |
| losses | | |
+--------------+---------+----------+
| Loss | 110 | 106 |
| on | | |
| disposal | | |
| of | | |
| property, | | |
| plant & | | |
| equipment | | |
+--------------+---------+----------+
| Share | 192 | (301) |
| option | | |
| / | | |
| awards | | |
| charge | | |
| / | | |
| (credit) | | |
+--------------+---------+----------+
| Net | 138 | 161 |
| finance | | |
| losses | | |
+--------------+---------+----------+
| Net | 1,118 | (1,132) |
| change | | |
| in | | |
| derivative | | |
| financial | | |
| assets and | | |
| liabilities | | |
+--------------+---------+----------+
| Share | (86) | (75) |
| of | | |
| profit | | |
| in | | |
| joint | | |
| venture | | |
+--------------+---------+----------+
| Decrease | 64 | 80 |
| in | | |
| non-current | | |
| prepayments | | |
+--------------+---------+----------+
| Decrease | 3,026 | (5,923) |
| / | | |
| (increase) | | |
| in | | |
| inventories | | |
+--------------+---------+----------+
| Decrease | 1,649 | (9,318) |
| / | | |
| (increase) | | |
| in trade | | |
| and other | | |
| receivables | | |
+--------------+---------+----------+
| (Decrease) | (4,908) | 7,345 |
| / increase | | |
| in trade | | |
| and other | | |
| payables | | |
+--------------+---------+----------+
| Interest | (157) | (330) |
| paid | | |
+--------------+---------+----------+
| Income | (6,602) | (5,052) |
| taxes | | |
| paid | | |
+--------------+---------+----------+
| Net | 21,093 | 11,103 |
| cash | | |
| generated | | |
| from | | |
| operating | | |
| activities | | |
+--------------+---------+----------+
| | | |
+--------------+---------+----------+
| Cash | | |
| flow | | |
| from | | |
| investing | | |
| activities | | |
+--------------+---------+----------+
| Purchases | (4,538) | (11,828) |
| of | | |
| property, | | |
| plant & | | |
| equipment | | |
+--------------+---------+----------+
| Proceeds | - | 14 |
| from | | |
| sale of | | |
| property, | | |
| plant & | | |
| equipment | | |
+--------------+---------+----------+
| Interest | 8 | 149 |
| received | | |
+--------------+---------+----------+
| Net | (4,530) | (11,665) |
| cash | | |
| from | | |
| investing | | |
| activities | | |
+--------------+---------+----------+
| | | |
+--------------+---------+----------+
| Cash | | |
| flow | | |
| from | | |
| financing | | |
| activities | | |
+--------------+---------+----------+
| Own | - | (2,014) |
| shares | | |
| acquired | | |
+--------------+---------+----------+
| Proceeds | 43 | 64 |
| from | | |
| option | | |
| holders | | |
| for | | |
| exercise | | |
| of | | |
| options | | |
+--------------+---------+----------+
| Dividends | (6,928) | (6,983) |
| paid | | |
+--------------+---------+----------+
| Net | (6,885) | (8,933) |
| cash | | |
| from | | |
| financing | | |
| activities | | |
+--------------+---------+----------+
| | | |
+--------------+---------+----------+
| Net | 9,678 | (9,495) |
| increase | | |
| in cash | | |
| and cash | | |
| equivalents | | |
+--------------+---------+----------+
| | | |
+--------------+---------+----------+
| | | |
+--------------+---------+----------+
| Cash | 4,660 | 13,105 |
| and | | |
| cash | | |
| equivalents | | |
| at 31 | | |
| January | | |
| 2009 / 26 | | |
| January | | |
| 2008 | | |
+--------------+---------+----------+
| Exchange | (640) | 1,050 |
| rate | | |
| movement | | |
+--------------+---------+----------+
| Cash | 13,698 | 4,660 |
| and | | |
| cash | | |
| equivalents | | |
| at 30 | | |
| January | | |
| 2010 / 31 | | |
| January | | |
| 2009 | | |
+--------------+---------+----------+
Notes
1. Basis of preparation
EU law (IAS Regulation EC 1606/2002) requires that the Group financial
statements, for the 52 weeks ended 30 January 2010, are prepared in accordance
with International Financial Reporting Standards (IFRSs) adopted for use in the
EU ("adopted IFRSs").
This financial informationhas been prepared on the basis of the recognition and
measurement requirements of adopted IFRSs as at 30 January 2010.
The financial information set out above does not constitute the Group's
statutory accounts for the 52 weeks ended 30 January 2010 or 53 weeks ended 31
January 2009. The annual financial information presented in this annual results
announcement for the 52 weeks ended 30 January 2010 is based on, and is
consistent with, that in the Group's audited financial statements for the 52
weeks ended 30 January 2010, and those financial statements will be delivered
during the second week of May 2010. The auditor's report on those financial
statements is unqualified and does not contain any statement under Section 498
(2) or (3) of the Companies Act 2006.
Statutory accounts for 31 January 2009 have been delivered to the registrar of
companies. The auditors have reported on those accounts; their reports were i)
unqualified and, ii) did not contain statements under section 237 (2) or (3) of
the Companies Act 1985.
Going concern
The Group's business activities, together with the factors likely to affect its
future development, performance and position are set out in the Business Review.
The financial position of the Group, its cash flows, liquidity position and
borrowing facilities are described in the Chairman's Statement. In addition, the
annual report and accounts for the 52 weeks ended 30 January 2010 includes the
Group's objectives, policies and processes for managing its capital; its
financial risk management objectives; details of its financial instruments and
hedging activities; and its exposures to credit risk and liquidity risk.
The Group's forecasts and projections, taking into account reasonably possible
changes in trading performance, show that the Group has sufficient financial
resources. As a consequence the Directors have a reasonable expectation that the
Company and the Group are well placed to manage their business risks and to
continue in operational existence for the foreseeable future, despite the
current uncertain global economic outlook. Accordingly, the Directors continue
to adopt the going concern basis in preparing the consolidated financial
statements.
Significant accounting policies
The following adopted accounting standards and interpretations, issued by the
International Accounting Standards Board (IASB) or International Financial
Reporting, Interpretations Committee (IFRIC), have been adopted for the first
time by the Group in the 52 weeks ended 30 January 2010 with no significant
impact on its consolidated results or financial position:
· Determination of operating segments - As of 1 January 2009 the Group has
adopted IFRS 8, Operating Segments. The new accounting policy in respect of
segment operating disclosures has led to a change in the number and/or
definition of segments previously presented on the basis that the information
disclosed is consistent to that provided to the Board (see note 2 for further
details).
· Presentation of financial statements - the Group has applied revised IAS
1, Presentation of financial statements, which became effective as of 1 January
2009. Comparative information has been represented so that it is also in
conformity with the revised standard. Since the change in accounting policy only
impacts presentation aspects there is no impact on the Group's net cash flows,
financial position, total comprehensive income or earnings per share.
· Accounting for marketing expenditure - the Group has applied in its
financial statements amended IAS 38, Intangible Assets, which clarify the
accounting for the Group's marketing expenditure. This amendment has no impact
on the Group's net cash flows, financial position, total comprehensive income or
earnings per share.
· IAS 23 (Revised), Borrowing Costs, has removed the option of immediately
recognising, as an expense, borrowing costs that relate to assets that take a
substantial period of time to get ready for use or sale. The revised standard
requires such borrowing costs to be capitalised as part of the cost of the
asset. This revised standard has had no impact on the Group's net cash flows,
financial position, total comprehensive income or earnings per share.
· Amendments to IAS 32, Financial Instruments: Presentation, and IAS 1,
Presentation of Financial Statements, relating to puttable financial instruments
and obligations arising on liquidation. These amendments have no impact on the
Group's net cash flows, financial position, total comprehensive income or
earnings per share.
· Amendment to IFRS 2, Share-based Payment, clarifies that vesting
conditions are service conditions and performance conditions only; other
features of a share-based payment are not vesting conditions. It also specifies
that all cancellations, whether by the entity or by other parties, should
receive the same accounting treatment. This amendment to IFRS 2 has no
significant impact on the Group's net cash flows, financial position, total
comprehensive income or earnings per share.
· IFRIC 13, Customer Loyalty Programmes, addresses accounting by entities
that grant loyalty award credits to customers who buy other goods or services,
and has no impact on the Group's net cash flows, financial position, total
comprehensive income or earnings per share.
The following revisions to IFRS will be applicable in future periods, subject to
endorsement where applicable:
· Revised IFRS 3 Business Combinations and amendments to IAS 27
Consolidated and Separate Financial Statements are applicable for 2010. These
standards will affect the future accounting for acquisitions and transactions
with non-controlling interests. There will be no retrospective impact.
· Amendments to IFRS 2 Group Cash-settled Share-based Payment Transactions
are applicable from 2010. If endorsed, these amendments will apply but the
impact is not anticipated to be significant.
· IFRS 9 Financial Instruments is applicable from 2013. If endorsed, this
standard will simplify the classification of financial assets for measurement
purposes, but is not anticipated to have a significant impact on the financial
statements.
· The Group does not consider that any other standards, amendments or
interpretations issued by the IASB, but not yet applicable, will have
significant impact on the financial statements.
2. Segment information
The Group has the three reportable segments; retail, wholesale and licence
income.
For each of the three segments, the Group's chief operating decision maker (the
"Board") reviews internal management reports on a four weekly basis.
The accounting policies of the reportable segments are the same as described in
note (s) of the Group statutory accounts for the 52 weeks ended 30 January 2010.
Information regarding the results of each reportable segment is included below.
Performance for the retail segment is measured based on operating contribution,
whereas performance of the wholesale segment is measured based on gross profit
and performance of the licence segment is measured based on royalty income, as
included in the internal management reports that are reviewed by the Board.
Segment results are used to measure performance as management believes that such
information is the most relevant in evaluating the performance of certain
segments relative to other entities that operate within these industries.
Inter-segment pricing is determined on an arm's length basis.
a) Segment revenue and segment result
+----------------+----------+-----------+---------+----------+
| 52 | Retail | Wholesale | Licence | Total |
| weeks | | | income | |
| ended | | | | |
| 30 | | | | |
| January | | | | |
| 2010 | | | | |
+----------------+----------+-----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Revenue | 136,455 | 27,131 | - | 163,586 |
+----------------+----------+-----------+---------+----------+
| Cost | (47,884) | (15,775) | - | (63,659) |
| of | | | | |
| sales | | | | |
+----------------+----------+-----------+---------+----------+
| Gross | 88,571 | 11,356 | - | 99,927 |
| profit | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | (63,641) | - | - | (63,641) |
| costs | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | 24,930 | 11,356 | - | 36,286 |
| contribution | | | | |
+----------------+----------+-----------+---------+----------+
| Licence | - | - | 5,493 | 5,493 |
| income | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 24,930 | 11,356 | 5,493 | 41,779 |
| result | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Reconciliation | | | | |
| of segment | | | | |
| result to | | | | |
| profit before | | | | |
| tax | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 24,930 | 11,356 | 5,493 | 41,779 |
| result | | | | |
+----------------+----------+-----------+---------+----------+
| Impairment | (750) | - | - | (750) |
| losses | | | | |
+----------------+----------+-----------+---------+----------+
| Central | - | - | - | (21,327) |
| operating | | | | |
| costs | | | | |
+----------------+----------+-----------+---------+----------+
| Other | - | - | - | 80 |
| operating | | | | |
| income | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | | | | 19,782 |
| profit | | | | |
+----------------+----------+-----------+---------+----------+
| Net | | | | (364) |
| finance | | | | |
| expense | | | | |
+----------------+----------+-----------+---------+----------+
| Share | | | | 86 |
| of | | | | |
| profit | | | | |
| of | | | | |
| jointly | | | | |
| controlled | | | | |
| entity, | | | | |
| net of tax | | | | |
+----------------+----------+-----------+---------+----------+
| Profit | | | | 19,504 |
| before | | | | |
| tax | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Capital | 4,497 | 47 | - | 4,544 |
| expenditure | | | | |
+----------------+----------+-----------+---------+----------+
| Depreciation | 6,230 | 65 | - | 6,295 |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 74,896 | 16,769 | - | 91,665 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| Other | | | | 4,475 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| Total | | | | 96,140 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | (20,923) | (4,160) | - | (25,083) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| Other | | | | (4,827) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| Total | | | | (29,910) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Net | | | | 66,230 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
Wholesale sales are shown after the elimination of inter-company sales of
GBP7,113,000 (2009: GBP7,846,000).
+----------------+----------+-----------+---------+----------+
| 53 | Retail | Wholesale | Licence | Total |
| weeks | | | | |
| ended | | | | |
| 31 | | | | |
| January | | | | |
| 2009 | | | | |
+----------------+----------+-----------+---------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Revenue | 118,237 | 34,424 | - | 152,661 |
+----------------+----------+-----------+---------+----------+
| Cost | (43,505) | (19,790) | - | (63,295) |
| of | | | | |
| sales | | | | |
+----------------+----------+-----------+---------+----------+
| Gross | 74,732 | 14,634 | - | 89,366 |
| profit | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | (55,838) | - | - | (55,838) |
| costs | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | 18,894 | 14,634 | - | 33,528 |
| contribution | | | | |
+----------------+----------+-----------+---------+----------+
| Licence | - | - | 5,476 | 5,476 |
| income | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 18,894 | 14,634 | 5,476 | 39,004 |
| result | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Reconciliation | | | | |
| of segment | | | | |
| result to | | | | |
| profit before | | | | |
| tax | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 18,894 | 14,634 | 5,476 | 39,004 |
| result | | | | |
+----------------+----------+-----------+---------+----------+
| Impairment | (1,786) | - | - | (1,786) |
| losses | | | | |
+----------------+----------+-----------+---------+----------+
| Central | - | - | - | (20,110) |
| operating | | | | |
| costs | | | | |
+----------------+----------+-----------+---------+----------+
| Other | - | - | - | 53 |
| operating | | | | |
| income | | | | |
+----------------+----------+-----------+---------+----------+
| Operating | | | | 17,161 |
| profit | | | | |
+----------------+----------+-----------+---------+----------+
| Net | | | | 530 |
| finance | | | | |
| expense | | | | |
+----------------+----------+-----------+---------+----------+
| Share | | | | 75 |
| of | | | | |
| profit | | | | |
| of | | | | |
| jointly | | | | |
| controlled | | | | |
| entity, | | | | |
| net of tax | | | | |
+----------------+----------+-----------+---------+----------+
| Profit | | | | 17,766 |
| before | | | | |
| tax | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Capital | 11,748 | 378 | - | 12,126 |
| expenditure | | | | |
+----------------+----------+-----------+---------+----------+
| Depreciation | 5,803 | 187 | - | 5,990 |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | 75,566 | 19,654 | - | 95,220 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| Other | | | | 1,128 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| Total | | | | 96,348 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Segment | (23,085) | (6,721) | - | (29,806) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| Other | | | | (4,376) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| Total | | | | (34,182) |
| liabilities | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
| Net | | | | 62,166 |
| assets | | | | |
+----------------+----------+-----------+---------+----------+
| | | | | |
+----------------+----------+-----------+---------+----------+
b) Geographical information
+-------------+---------+---------+---------+
| | UK & | US | Total |
| | Europe | | |
+-------------+---------+---------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+---------+---------+---------+
| 52 | | | |
| weeks | | | |
| ended | | | |
| 30 | | | |
| January | | | |
| 2010 | | | |
+-------------+---------+---------+---------+
| Revenue | 153,527 | 10,059 | 163,586 |
+-------------+---------+---------+---------+
| Non-current | 22,885 | 4,270 | 27,155 |
| assets* | | | |
+-------------+---------+---------+---------+
| | | | |
+-------------+---------+---------+---------+
| 53 | | | |
| weeks | | | |
| ended | | | |
| 31 | | | |
| January | | | |
| 2009 | | | |
+-------------+---------+---------+---------+
| Revenue | 142,201 | 10,460 | 152,661 |
+-------------+---------+---------+---------+
| Non-current | 26,075 | 4,345 | 30,420 |
| assets* | | | |
+-------------+---------+---------+---------+
| | | | |
+-------------+---------+---------+---------+
*Non-current assets exclude deferred tax assets.
c) Revenue by collection
+------------+---------+---------+
| | 52 | 53 |
| | weeks | weeks |
| | ended | ended |
| | 30 | 31 |
| | January | January |
| | 2010 | 2009 |
+------------+---------+---------+
| | GBP'000 | GBP'000 |
+------------+---------+---------+
| | | |
+------------+---------+---------+
| Menswear | 88,376 | 86,967 |
+------------+---------+---------+
| Womenswear | 75,210 | 65,694 |
+------------+---------+---------+
| | 163,586 | 152,661 |
+------------+---------+---------+
3. Profit before taxation
+---------------+---------+---------+
| | 52 | 53 |
| | weeks | weeks |
| Profit | ended | ended |
| before | 30 | 31 |
| taxation | January | January |
| is | 2010 | 2009 |
| stated | | |
| after | | |
| charging: | | |
+---------------+---------+---------+
| | GBP'000 | GBP'000 |
+---------------+---------+---------+
| | | |
+---------------+---------+---------+
| Depreciation | 6,295 | 5,990 |
| | | |
+---------------+---------+---------+
| Impairment | 750 | 1,786 |
| losses | | |
+---------------+---------+---------+
| Operating | 15,510 | 12,299 |
| lease | | |
| rentals | | |
+---------------+---------+---------+
| Fees | 9 | 7 |
| payable | | |
| to the | | |
| company's | | |
| auditor | | |
| for the | | |
| audit of | | |
| the | | |
| company's | | |
| annual | | |
| accounts | | |
+---------------+---------+---------+
| Fees | 76 | 75 |
| payable | | |
| to the | | |
| company's | | |
| auditor | | |
| for the | | |
| audit of | | |
| the | | |
| company's | | |
| subsidiaries, | | |
| pursuant to | | |
| legislation | | |
+---------------+---------+---------+
| Fees | 20 | 18 |
| payable | | |
| to the | | |
| company's | | |
| auditor | | |
| for other | | |
| services | | |
| supplied | | |
| pursuant | | |
| to | | |
| legislation | | |
+---------------+---------+---------+
| Other | 3 | - |
| services | | |
| provided | | |
| by the | | |
| company's | | |
| auditor | | |
+---------------+---------+---------+
| Loss | 110 | 106 |
| on | | |
| disposal | | |
| of | | |
| property, | | |
| plant & | | |
| equipment | | |
+---------------+---------+---------+
4. Finance income and expenses
+----------------------------------------------+------------+---------------+
| | 52 weeks | 53 weeks |
| | ended | ended |
| | 30 January | 31 January |
| | 2010 | 2009 |
+----------------------------------------------+------------+---------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------+------------+---------------+
| Finance income | | |
+----------------------------------------------+------------+---------------+
| - Interest receivable | 10 | 146 |
+----------------------------------------------+------------+---------------+
| - Foreign exchange gains | - | 691 |
+----------------------------------------------+------------+---------------+
| | 10 | 837 |
+----------------------------------------------+------------+---------------+
| Finance expenses | | |
+----------------------------------------------+------------+---------------+
| - Interest payable | (148) | (307) |
+----------------------------------------------+------------+---------------+
| - Foreign exchange losses | (226) | - |
+----------------------------------------------+------------+---------------+
| | (374) | (307) |
+----------------------------------------------+------------+---------------+
5. Income tax expense
a) The tax charge comprises
+----------------------------------------------+------------+---------------+
| | 52 weeks | 53 weeks |
| | ended | ended |
| | 30 January | 31 January |
| | | 2009 |
| | 2010 | |
+----------------------------------------------+------------+---------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------+------------+---------------+
| Current tax | 6,336 | 5,591 |
+----------------------------------------------+------------+---------------+
| Deferred tax | (521) | (156) |
+----------------------------------------------+------------+---------------+
| Prior year under / (over) provision | 162 | (237) |
+----------------------------------------------+------------+---------------+
| | 5,977 | 5,198 |
+----------------------------------------------+------------+---------------+
b) Deferred tax movement by type
+----------------------------------------------+------------+------------+
| | 52 weeks | 53 weeks |
| | ended | ended |
| | 30 January | 31 January |
| | | |
| | 2010 | 2009 |
+----------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------+------------+------------+
| Property, plant & equipment | (396) | (261) |
+----------------------------------------------+------------+------------+
| Share based payments | (6) | 224 |
+----------------------------------------------+------------+------------+
| Overseas losses | (111) | (378) |
+----------------------------------------------+------------+------------+
| Inventory | (43) | (7) |
+----------------------------------------------+------------+------------+
| Other | 35 | 266 |
+----------------------------------------------+------------+------------+
| | (521) | (156) |
+----------------------------------------------+------------+------------+
c) Factors affecting the tax charge for the period
The tax assessed for the period is higher than the tax calculated at domestic
rates applicable to profits in the respective countries. The differences are
explained below.
+----------------------------------------------+------------+------------+
| | 52 weeks | 53 weeks |
| | ended | ended |
| | 30 January | 31 January |
| | | |
| | 2010 | 2009 |
+----------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------+------------+------------+
| Profit before tax | 19,504 | 17,766 |
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
| Profit multiplied by the standard rate in | 5,461 | 5,033 |
| the UK - 28%, (2009: weighted average rate | | |
| of 28.33%) | | |
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
| Expenses not deductible for tax purposes | 427 | 397 |
+----------------------------------------------+------------+------------+
| Overseas losses not previously recognised | 42 | 34 |
+----------------------------------------------+------------+------------+
| Statutory deductions for share options | 49 | (3) |
+----------------------------------------------+------------+------------+
| Prior year under / (over) provision | 162 | (237) |
+----------------------------------------------+------------+------------+
| Effect of rate change on corporation tax | - | 5 |
+----------------------------------------------+------------+------------+
| Differences due to overseas tax rates and | (164) | (31) |
| exchange rate movements | | |
+----------------------------------------------+------------+------------+
| Total income tax expense | 5,977 | 5,198 |
+----------------------------------------------+------------+------------+
d) Deferred and current tax recognised directly in equity
+----------------------------------------------+------------+------------+
| | 52 weeks | 53 weeks |
| | ended | ended |
| | 30 January | 31 January |
| | | |
| | 2010 | 2009 |
+----------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
| | | |
+----------------------------------------------+------------+------------+
| Deferred tax credit on share options | (13) | (49) |
+----------------------------------------------+------------+------------+
| Current tax on share options | - | 5 |
+----------------------------------------------+------------+------------+
| | (13) | (44) |
+----------------------------------------------+------------+------------+
6. Earnings per share
+-------------+------------+------------+
| | 52 | 53 |
| | weeks | weeks |
| | ended | ended |
| | 30 | 31 |
| | January | January |
| | 2010 | 2009 |
+-------------+------------+------------+
| | No. | No. |
+-------------+------------+------------+
| Number | | |
| of | | |
| shares: | | |
+-------------+------------+------------+
| Weighted | 41,613,798 | 42,563,397 |
| number | | |
| of | | |
| ordinary | | |
| shares | | |
| outstanding | | |
+-------------+------------+------------+
| Effect | 10,183 | 7,904 |
| of | | |
| dilutive | | |
| options | | |
+-------------+------------+------------+
| Weighted | 41,623,981 | 42,571,301 |
| number | | |
| of | | |
| ordinary | | |
| shares | | |
| outstanding | | |
| - diluted | | |
+-------------+------------+------------+
| | | |
+-------------+------------+------------+
| Earnings: | | |
+-------------+------------+------------+
| Profit | 13,576 | 12,593 |
| for | | |
| the | | |
| period | | |
| basic | | |
| and | | |
| diluted | | |
| - | | |
| GBP'000 | | |
+-------------+------------+------------+
| | | |
+-------------+------------+------------+
| Basic | 32.6p | 29.6p |
| earnings | | |
| per | | |
| share | | |
+-------------+------------+------------+
| Diluted | 32.6p | 29.6p |
| earnings | | |
| per | | |
| share | | |
+-------------+------------+------------+
Own shares held by the Ted Baker Group Employee Benefit Trust, the Ted Baker
1998 Employee Benefit Trust and treasury shares have been eliminated from the
weighted average number of ordinary shares. The options exercised during the
year were covered by shares held in treasury.
Diluted earnings per share have been calculated using additional ordinary shares
of 5p each available under the 1997 Unapproved Share Option Scheme, the 1997
Executive Share Option Scheme, the Ted Baker Performance Share Plan and the Ted
Baker 2009 Value Creation Plan.
There were no share related events after the balance sheet date that will affect
earnings per share.
7. Dividends per share
+----------+---------+---------+
| | 52 | 53 |
| | weeks | weeks |
| | ended | ended |
| | 30 | 31 |
| | January | January |
| | 2010 | 2009 |
+----------+---------+---------+
| | GBP'000 | GBP'000 |
+----------+---------+---------+
| | | |
+----------+---------+---------+
| Final | 4,743 | 4,799 |
| dividend | | |
| paid for | | |
| prior | | |
| year of | | |
| 11.4p | | |
| per | | |
| ordinary | | |
| share | | |
| (2009: | | |
| 11.4p) | | |
+----------+---------+---------+
| Interim | 2,185 | 2,184 |
| dividend | | |
| paid of | | |
| 5.25p | | |
| per | | |
| ordinary | | |
| share | | |
| (2009: | | |
| 5.25p) | | |
+----------+---------+---------+
| | 6,928 | 6,983 |
+----------+---------+---------+
A second interim dividend in respect of 2010 of 11.4p per share, amounting to
GBP4,744,506, will be paid on 26 March 2010. A final dividend in respect of 2010
of 0.5p per share, amounting to a dividend payable of GBP208,092, is to be
proposed at the Annual General Meeting on 15 June 2010.
8. Property, plant and equipment
+-------------------+--------------+-----------+-----------+--------------+-----------+
| | Leasehold | Fixtures, | Motor | Assets | Total |
| | improvements | fittings | vehicles | under | |
| | | & office | | construction | |
| | | equipment | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Cost | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 31 January | 32,188 | 29,021 | 165 | 203 | 61,577 |
| 2009 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Additions | 2,043 | 2,186 | 12 | 303 | 4,544 |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Disposals | (14) | (815) | - | - | (829) |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Exchange rate | (732) | (418) | (7) | - | (1,157) |
| movement | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 30 January | 33,485 | 29,974 | 170 | 506 | 64,135 |
| 2010 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Depreciation | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 31 January | 13,019 | 19,734 | 123 | - | 32,876 |
| 2009 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Charge for the | 2,508 | 3,768 | 19 | - | 6,295 |
| year | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Impairment losses | 680 | 70 | - | - | 750 |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Disposals | (8) | (711) | - | - | (719) |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Exchange rate | (273) | (299) | (3) | - | (575) |
| movement | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 30 January | 15,926 | 22,562 | 139 | - | 38,627 |
| 2010 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| Net book value | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 31 January | 19,169 | 9,287 | 42 | 203 | 28,701 |
| 2009 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
| At 30 January | 17,559 | 7,412 | 31 | 506 | 25,508 |
| 2010 | | | | | |
+-------------------+--------------+-----------+-----------+--------------+-----------+
Additions included within the assets under construction category are stated net
of transfers to other property, plant and equipment categories. Transfers from
the assets under construction category in the period amounted to GBP203,000
(2009: GBP1,912,000) whilst additions into this category were GBP506,000 (2009:
GBP203,000).
Impairment losses recognised in the year were GBP750,000 (2009: GBP1,786,000).
The impairment losses were as a result of a review of the carrying value of the
portfolio of store assets.
Impairment of property, plant and equipment
The Group has determined that for the purposes of impairment testing, each store
and outlet is a cash-generating unit. Cash-generating units are tested for
impairment if there are indications of impairment at the balance sheet date.
Recoverable amounts for cash-generating units are based on value in use, which
is calculated from cash flow projections using data from the Group's latest
internal forecasts, the results of which are reviewed by the Board. The key
assumptions for the value in use calculations are those regarding discount
rates, growth rates and expected changes in margins. Management estimates
discount rates using pre-tax rates that reflect the current market assessment of
the time value of money and the risks specific to the cash-generating units.
Changes in selling prices and direct costs are based on past experience and
expectations of future changes in the market.
The pre-tax discount rate used to calculate value in use is derived from the
Group's weighted average cost of capital.
Impairment losses relate to stores whose recoverable amounts (value in use) did
not exceed the asset carrying values. In all cases, impairment losses arose due
to stores performing below projected trading levels.
9. Share based payments - Value creation plan
The award of units is made under the Ted Baker 2009 Value Creation Plan ("2009
VCP"), which was approved by shareholders at the General Meeting held on 16 June
2009. Units have no value at grant, but subject to the satisfaction of earnings
per share, share price and total shareholder return performance targets,
converts into nil cost options to acquire ordinary shares in the Company at the
end of the three year performance period. Further details of the plan are
outlined in the notice of meeting dated 13 May 2009.
The terms and conditions of the award of units granted under the 2009 VCP during
the 52 weeks ended 30 January 2010 are as follows:
+--------+--------+---------+-------------+---------+
| Grant | Type | Number | Vesting | Vesting |
| date | of | of | conditions | period |
| | award | units | | |
+--------+--------+---------+-------------+---------+
| | | | | |
+--------+--------+---------+-------------+---------+
| 13 | Award | 100,000 | Growth | 50% |
| August | of | | in | after |
| 2009 | units | | earnings | three |
| | | | per | years |
| | | | share, | and |
| | | | share | the |
| | | | price | balance |
| | | | and | one |
| | | | total | year |
| | | | shareholder | later |
| | | | return over | |
| | | | a three | |
| | | | year | |
| | | | performance | |
| | | | period | |
+--------+--------+---------+-------------+---------+
VCP awards outstanding at the end of the period were as follows:
+----------------------------------------------+--------------+--------------+
| | At 30 | At 31 |
| | January | January |
| | 2010 | 2009 |
+----------------------------------------------+--------------+--------------+
| | No. of | No. of |
| | entitlements | entitlements |
+----------------------------------------------+--------------+--------------+
| | | |
+----------------------------------------------+--------------+--------------+
| At 1 February 2009 | - | - |
+----------------------------------------------+--------------+--------------+
| VCP entitlements awarded during the year | 100,000 | - |
+----------------------------------------------+--------------+--------------+
| Lapsed during the year | - | - |
+----------------------------------------------+--------------+--------------+
| Outstanding at 30 January 2010 | 100,000 | - |
+----------------------------------------------+--------------+--------------+
The VCP awards are valued using a Monte Carlo model. The inputs into the model
are as follows:
+----------------------------------------------------------+-------------+
| | 13 August |
| | 2009 |
+----------------------------------------------------------+-------------+
| Share price on award date | GBP3.98 |
+----------------------------------------------------------+-------------+
| Average share price at award date | GBP3.76 |
+----------------------------------------------------------+-------------+
| Number of simulations | 10,000 |
+----------------------------------------------------------+-------------+
| Expected life of options | 3 years |
+----------------------------------------------------------+-------------+
| Dividend yield | 4.18% |
+----------------------------------------------------------+-------------+
| Risk free interest rate | 2.21% |
+----------------------------------------------------------+-------------+
| Ted Baker volatility | 25.0% |
+----------------------------------------------------------+-------------+
| FTSE index volatility | 33.0% |
+----------------------------------------------------------+-------------+
| Correlation between Ted Baker and FTSE index | 12.0% |
+----------------------------------------------------------+-------------+
| Share price hurdle per annum | 10.0% |
+----------------------------------------------------------+-------------+
| Payout over share price hurdle | 12.5% |
+----------------------------------------------------------+-------------+
| Vesting percentage for meeting performance conditions | 100.0% |
+----------------------------------------------------------+-------------+
| Shares in issue | 41,418,476 |
+----------------------------------------------------------+-------------+
The charge for the year to the income statement amounted to GBP178,737 (2009:
GBPnil). Included in the charge for the year is an amount in respect of R S
Kelvin who is employed by the Company, amounting to GBP31,994 (2009: GBPnil).
10. Related parties
The Company has a related party relationship with its directors and executive
officers.
Directors of the Company and their immediate relatives control 41 per cent of
the voting shares of the Company.
As at 30 January 2010, the main trading company owed the parent company
GBP24,108,000 (2009: GBP9,149,000). The main trading company was owed
GBP11,869,000 (2009: GBP10,873,000) from the other subsidiaries within the
Group.
Transactions between subsidiaries were priced on an arms length basis.
The Group has a 50% interest in a joint venture. As at 30 January 2010, the
joint venture owed GBP261,000 to the main trading company (2009: GBP139,000). In
the period the value of sales made to the joint venture by the Group was
GBP364,000 (2009: GBP280,000).
The Group considers the Board of executive directors as key management. Further
details are provided in the Remuneration Report, which is included in the annual
report and accounts for the period ended 30 January 2010, which will be
dispatched to shareholders during the second week of May 2010.
Responsibility statement of the directors in respect of the annual financial
report
We, the directors of the Company, confirm that to the best of our knowledge;
· The financial statements, prepared in accordance with International
Financial Reporting Standards as adopted by the EU, give a true and fair view of
the assets, liabilities, financial position and profit for the Group and the
undertakings included in the consolidation taken as a whole; and
· Pursuant to Chapter 4 of the Disclosure and Transparency Rules, the
Group's annual report contains a fair review of the development and performance
of the business and the position of the Group, and the undertakings included in
the consolidation taken as a whole, together with a description of the principal
risks and uncertainties that they face.
The contents of this announcement, including the responsibility statement above,
have been extracted from the annual report and accounts for the period ended 30
January 2010 which will be despatched to shareholders during the second week of
May 2010. Accordingly the responsibility statement makes reference to the
financial statements of the Company and the Group and to the relevant narratives
appearing in that annual report and accounts rather than the contents of this
announcement.
On behalf of the board
Ray Kelvin
Lindsay Page
Chief Executive
Finance Director
25 March 2010
25 March 2010
This information is provided by RNS
The company news service from the London Stock Exchange
END
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