Interim Results -4-

  of property provision discount 
 
 

Notes to the Interim Consolidated Condensed Financial Statements

   1       General information 

The principal activity of the Group is the specialist retailing of greetings cards and associated products. This is carried out through two brands on the high street, Clinton Cards and Birthdays.

Clinton Cards PLC is a Public Limited Company incorporated and domiciled in England and Wales.

These interim consolidated condensed financial statements and the comparative figures for the 26 weeks ended 30 January 2011 do not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the 52 weeks ended 31 July 2011 were approved by the Board of Directors on 30 November 2011 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter and did not contain statements under Section 498 of the Companies Act 2006.

The interim results are unaudited and were approved by the Board of Directors on 28 March 2012.

   2       Basis of preparation 

The interim consolidated condensed financial report for the 26 weeks ended 29 January 2012 has been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34 "Interim Financial Reporting" as adopted by the European Union. The interim financial report should be read in conjunction with the annual financial statements for the 52 weeks ended 31 July 2011 which were prepared in accordance with IFRS's as adopted by the European Union.

The Group meets its day to day working capital requirements through a secured revolving credit facility which is due to expire in July 2013 with a maximum draw down available of GBP55m. The Group's forecasts and projections, taking account of reasonable possible changes in trading performance, show that the Group should be able to operate within the level of its current facility to the end of the financial year. Over the next four months, the directors will be in discussions with the lenders to secure future facilities. The directors have a reasonable expectation that the Group have adequate resources to continue in operational existence for the foreseeable future and therefore continue to adopt the going concern basis of accounting in preparing financial statements.

Use of adjusted measures

Adjusted operating profits or losses and adjusted net profits or losses are defined as operating profits or losses and net profits or losses before charging impairment and losses on sale of property, plant and equipment, the movement in the fair value of financial instruments, losses on discontinued operations, charges in respect of onerous leases and restructuring costs.

   3              Accounting policies 

The accounting policies adopted are consistent with those of the annual financial statements for the 52 weeks ended 31 July 2011 as described in those financial statements.

The financial statements have been prepared on the historical cost basis.

 
 4    Segmental Information 
 
                                             Clinton   Birthdays 
      Store information                        Cards      Retail    Group 
     -------------------------------------  --------  ----------  ------- 
                                                 No.         No.      No. 
      Store numbers 
  Stores at 30 January 2011                      649         157      806 
    Additions                                      1           -        1 
    Disposals (including relocations)           (15)         (3)     (18) 
    Relocations                                    6           2        8 
  Stores at 31 July 2011                         641         156      797 
    Additions                                      2           -        2 
    Disposals (including relocations)           (17)        (17)     (34) 
    Relocations                                    2           -        2 
                                            --------  ----------  ------- 
  Stores at 29 January 2012                      628         139      767 
                                            --------  ----------  ------- 
 
  Trading area (square feet)                     000         000      000 
  Trading area at 30 January 2011              1,250         272    1,522 
    Additions                                      3         (3)        - 
    Disposals                                   (36)           -     (36) 
    Relocations                                   20           3       23 
                                            --------  ----------  ------- 
  Trading area at 31 July 2011                 1,237         272    1,509 
    Additions                                      5           -        5 
    Disposals                                   (28)        (26)     (54) 
    Relocations                                    4           -        4 
                                            --------  ----------  ------- 
  Trading area at 29 January 2012              1,218         246    1,464 
 
      Average store size                       sq ft       sq ft    sq ft 
  At 30 January 2011                           1,926       1,735    1,889 
  At 31 July 2011                              1,931       1,746    1,895 
  At 29 January 2012                           1,941       1,767    1,909 
 
 
      Segmental information 
 4     (continued) 
 
                                          Clinton   Birthdays    Continuing   Discontinued 
      Income statement                      Cards      Retail    operations     operations      Group 
     ----------------------------------  --------  ----------  ------------  -------------  --------- 
                                          GBP'000     GBP'000       GBP'000        GBP'000    GBP'000 
      26 weeks ended 29 January 
       2012 
  Revenue (excluding VAT)                 171,699      25,450       197,149              -    197,149 
                                         --------  ----------  ------------  -------------  --------- 
  Adjusted operating profit                 3,588     (2,845)           743              -        743 
  Provision for onerous 
   lease                                      138       (545)         (407)              -      (407) 
  Restructuring costs                     (1,052)       (166)       (1,218)              -    (1,218) 
  Loss on sale of property, 
   plant and equipment                       (93)       (805)         (898)              -      (898) 
                                         --------  ----------  ------------  -------------  --------- 
  Operating profit/(loss)                   2,581     (4,361)       (1,780)              -    (1,780) 
                                         --------  ---------- 
  Net finance costs                                                 (1,894)              -    (1,894) 
                                                               ------------  -------------  --------- 
  Loss before tax                                                   (3,674)              -    (3,674) 
  Taxation                                                              166              -        166 
                                                               ------------  -------------  --------- 
  Loss after tax                                                    (3,508)              -    (3,508) 
 --------------------------------------  --------  ----------  ------------  -------------  --------- 
 
      26 weeks ended 30 January 
       2011 
  Revenue (excluding VAT)                 178,297      28,596       206,893          3,408    210,301 
                                         --------  ----------  ------------  -------------  --------- 
  Adjusted operating profit                14,703       (292)        14,411          (523)     13,888 
  Assets impaired                               -           -             -        (1,620)    (1,620) 
  Provision for onerous 
   lease                                        -           -             -        (1,500)    (1,500) 
  Loss on sale of property, 
   plant and equipment                    (1,051)       (294)       (1,345)              -    (1,345) 
                                         --------  ----------  ------------  -------------  --------- 
  Operating profit/(loss)                  13,652       (586)        13,066        (3,643)      9,423 
                                         --------  ---------- 
  Net finance costs                                                 (1,333)              -    (1,333) 
                                                               ------------  -------------  --------- 
  Profit/(loss) before 
   tax                                                               11,733        (3,643)      8,090 
  Taxation                                                          (3,286)              -    (3,286) 
                                                               ------------  -------------  --------- 
  Profit/(loss) after 
   tax                                                                8,447        (3,643)      4,804 
 --------------------------------------  --------  ----------  ------------  -------------  --------- 
 
      52 weeks ended 31 July 
       2011 
  Revenue (excluding VAT)                 312,878      51,340       364,218          3,347    367,565 
                                         --------  ----------  ------------  -------------  --------- 
  Adjusted operating profit/(loss)          7,004     (3,801)         3,203          (558)      2,645 
  Net impairment to property, 
   plant and equipment                    (4,126)     (1,560)       (5,686)              -    (5,686) 
  Charges in respect of 
   onerous leases                         (1,819)     (2,825)       (4,644)        (1,411)    (6,055) 
  Loss on sale of property,