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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Goals Soccer Centres Plc | LSE:GOAL | London | Ordinary Share | GB00B0486M37 | ORD 0.25P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 27.20 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMGOAL
RNS Number : 4814A
Goals Soccer Centres PLC
12 September 2018
Goals Soccer Centres plc
Interim Results for the six months ended 30 June 2018
Goals Soccer Centres plc ("Goals" or the "Group") a leading operator of outdoor small-sided soccer centres with 49 sites, including three in California, USA, announces its interim results for the period ended 30 June 2018.
As announced previously in the trading update of 19 July 2018, Goals' performance has been impacted by the snow in Q1 2018 and further impacted in Q2 2018 by the re-scheduling of amateur 11-a-side games to midweek time slots when players would normally be playing 5-a-side.
H2 trading has started well and despite the challenging H1, Like-for-Like Sales (note 1) for the year to date are now positive. Trading has normalised and has returned to its positive trend following the anticipated slowdown during the World Cup, demonstrating clearly that where major investments have been made positive sales trends follow. We are therefore optimistic with respect to the trading outlook for the remainder of the year.
Statutory measures
Hot Features
Premium
H1 2018 H1 2017
Sales GBP16.2m GBP17.4m
Exceptional Items (GBP2.7m) -
Operating (Loss)/ Profit (GBP0.6m) GBP2.8m
(Loss)/Profit Before Tax (GBP1.1m) GBP2.6m
Basic Earnings Per Share (1.7p) 2.7p
Net Cash Flow from Operating Activities GBP1.9m GBP1.9m
---------- ---------
Underlying performance
Statutory measures have been adjusted to reflect like-for-like ownership of Goals Soccer Centers Inc and exceptional costs of GBP2.7m relating to the impairment of an underperforming site and restructuring costs.
-- Underlying Like-for-Like Sales (note 1) declined by 2.8% (2017: +1.6%) to GBP16.2m due to the impact of the challenging weather conditions in Q1 2018 and the knock-on impact in Q2 2018. The overall sales trend excluding the impact of adverse weather maintained its recent positive trend
-- Underlying Group EBITDA (note 2) declined by 15.5% to GBP4.0m (2017: GBP4.7m) -- Underlying Profit Before Tax (note 3) reduced by 39.5% to GBP1.7m (2017: GBP2.9m)
-- Exceptional costs of GBP2.7m (2017: nil) were incurred of which GBP2.2m was a non-cash asset impairment charge relating to the sale of a non-core centre
-- Net debt at 30 June 2018 stood at GBP30.2m (2017: GBP28.6m) and current leverage of Net Debt/EBITDA is 3.19 times (2017: 2.7 times)
-- The Group's balance sheet remains well capitalised with net assets of GBP97.2m (2017: GBP93.0m)
-- No interim dividend is proposed.
The notes detailing underlying and adjusted performance measures can be found in pages 6 to 8 of this report.
Key highlights
-- Goals continues to make progress through investing across its estate and where modernisation has taken place underlying improvement in performance is being achieved. There has been significant progress in 2018 in delivering our strategic plan:
o 260 out of our 460 arenas have been fully modernised and are delivering good returns at clubs where five or more arenas have been upgraded. Performance improved at clubs with between one and four upgraded arenas
o The planned GBP3.0m modernisation of a further 78 arenas is underway and is expected to be completed by early October 2018. Following this investment, 73% of the estate will have been upgraded and 39 of our 46 clubs in the UK will have 5 or more upgraded arenas.
-- Continued expansion in the US with our Joint Venture partner City Football Group ("CFG"):
o US trading through our JV partnership continues to improve with total sales up 51.7% to $1.4m and the rollout of new clubs has been accelerated
o Third US club in Rancho Cucamonga, California was opened in January 2018
o Fourth US club in Covina, California is under construction and expected to open in November 2018.
-- Michael Bolingbroke, who has been the Senior Independent Director since July 2016, was appointed Interim Non-Executive Chairman in February 2018 and took up the role of Non-Executive Chairman on 7 September 2018.
-- Our new CEO Andy Anson joined the Group at the end of April. Whilst Andy's immediate focus is to ensure the investment strategy is completed effectively, he is also undertaking a review of the business, the organisation and its operations, to refine and advance the strategy and to develop a plan to take the Group forward both in the UK and internationally, and to maximise returns for shareholders.
Andy Anson, CEO said:
"I am greatly encouraged by our performance in recent weeks which has seen the business fully recoup the financial effects of the extreme weather and moved us into positive like-for-like sales territory for the year to date.
As I carry out my review of the business I am delighted by the underlying performance of the sites where we have invested vindicating our strategy to upgrade our estate.
As we move forward I will be focusing on completing the investment strategy effectively, adapting where appropriate and delivering to shareholders the performance that Goals is capable of."
12(th) September 2018
Enquiries:
Goals Soccer Centres plc Michael Bolingbroke, Chairman Andy Anson, CEO Bill Gow, CFO 01355 234 800 Canaccord Genuity Limited (Nominated Adviser and Broker) Chris Connors Martin Davison Richard Andrews 020 7523 8350 Instinctif Partners Matthew Smallwood Andy Low 020 7457 2020
The information contained within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
Business Review
The Business
Goals was impacted by the challenging weather conditions in Q1 2018 which directly reduced Sales by GBP0.4m and Profit by GBP0.5m. This, combined with a further indirect impact on trading throughout Q2 2018 due to amateur 11-a-side games deferred from Q1 to dates in Q2, resulted in a decline in Like-for-Like Sales of 2.8%. The overall sales trend excluding the impact of adverse weather maintained its recent positive trend.
Trading in H2 has started well and despite the challenging H1, Like-for-Like Sales (note 1) for the year to date are now positive. Trading has normalised and has returned to its positive trend following the anticipated slowdown during the World Cup, demonstrating clearly that where major investments have been made positive sales trends follow.
I am pleased to announce that we have made progress with each of the strategic priorities, outlined below:
-- Grow and innovate the UK core estate
-- Develop new capabilities and gain competitive advantage
-- International expansion of centres and brand
-- Unlock underlying asset potential
We have made further progress in growing and innovating the UK estate with 260 of our 460 arenas already fully modernised. These continue to deliver good returns at clubs where five or more arenas have been upgraded. The planned investment of GBP3m in upgrading a further 78 arenas is underway and will be complete by early October 2018. This will increase the number of arenas modernised to 338 (73% of our estate) and 39 of our 46 clubs in the UK will have 5 or more upgraded arenas. Following this refurbishment the average pitch age will reduce to 3.2 years (2017: 4.1 years). We plan to continue to invest in our arenas in the coming years.
We continue to review the Return on Investment from the five "Clubhouse 2020" clubs modernised in 2017 and plan to recommence this project in due course when sufficient funding is available.
We continue to expand our range of services within the vibrant junior and youth markets with the launch of Goals Junior Academy at 4 clubs and a further 4 are planned for H2.
I am pleased to announce that we have entered into a 3-year sponsorship agreement with The Energy Check, one of the UK's leading energy consultancies. Goals will receive an annual fee in exchange for marketing rights across the Goals estate. Further sponsorship agreements are under discussion.
In conjunction with our JV partner CFG, we continue to make positive progress in the US. Our third club opened at Rancho Cucamonga in Los Angeles in January 2018 and our fourth US club in Covina, Los Angeles, is on schedule to open in November 2018. Sales at Goals Soccer Centers Inc increased by 51.7% to $1.4m (2017: $0.9m) and Like-for-Like Sales increased by 4.1% (2017: -4.5%). Initial trading at Pomona, which opened in 2017, and Rancho Cucamonga has been below our expectations as it is taking longer than planned to convert existing 11-a-side players to 5-a-side players. Marketing initiatives are planned to drive growth at these centres.
Board
Andy Anson, who previously held senior roles at Manchester United plc, The Walt Disney Company, and at Channel 4 in the UK, joined the Group as Chief Executive on 23 April 2018. Whilst Andy's focus initially is to execute and complete the modernisation of Goals' estate effectively, he is also undertaking a review of the Group and will develop a plan to fully realise the potential inherent value within the UK estate.
Bill Gow, Chief Financial Officer, has resigned from the Group to join his family business. A search for his successor has begun and Bill will continue in his role as Chief Financial Officer up until his successor is identified and has started. The Board would like to acknowledge and express its sincere gratitude to Bill for his invaluable and constructive contribution to the Board over the years.
Scott Lloyd resigned as Non-Executive Director during the period to focus on his full-time responsibilities as Chief Executive of the Lawn Tennis Association. The Board would like to thank Scott for his contribution and counsel during his time with Goals.
Jackie Ronson joined the Group as Non-Executive Director on 12 June 2018. Jackie is currently the Digital, CRM & Insights Director at EE, part of the BT Group plc. As a well-respected business leader and digital specialist, she brings a wealth of experience in consumer-facing industries to the Group, which will be important as the Group seeks to significantly improve its customer data and digital functions.
Current trading and Outlook
H2 trading has started well and despite the challenging H1, Like-for-Like Sales (note 1) for the year to date are now positive. Trading has normalised and has returned to its positive trend following the anticipated slowdown during the World Cup, demonstrating clearly that where major investments have been made positive sales trends follow. We are therefore optimistic with respect to the trading outlook for the remainder of the year.
Financial Review
Since the completion of the Joint Venture with CFG in July 2017, the financial results of Goals Soccer Centers Inc have been accounted for using the equity method of accounting. A number of Underlying measures and Total System Sales have been included within the Financial Review to give a like-for-like comparison.
Total Group Sales declined by 7.0% to GBP16.2m (2017: GBP17.4m) with Underlying Like-for-Like Sales declining by 2.8% (2017: +1.6%) to GBP16.2m due to the impact of the challenging weather conditions in Q1 2018 and the knock-on impact in Q2 2018. Like-for-Like Sales (note 1) excluding these weather-related events continued their recent positive trend.
Underlying Group EBITDA (note 2) declined by 15.5% to GBP4.0m (2017: GBP4.7m). This decline has been driven by the challenging weather conditions and an increase in UK overheads of GBP0.25m (2.4%) due to statutory increases in Living Wage and Business Rates.
UK depreciation and amortisation increased by 9.3% to GBP1.8m (2017: GBP1.6m) due to the increased level of capital expenditure over the last 2 years.
The decline in Underlying Group EBITDA (note 2) and increase in depreciation and amortisation resulted in a 28.6% decline in Underlying Operating Profit (note 6) to GBP2.2m (2017: GBP3.1m).
Financial expenses increased by 82.9% to GBP0.4m (2017: GBP0.2m) due to the increase in libor and Underlying EBITDA bank interest cover reduced to 18.5 times at 30 June 2018 (2017: 29.1 times). Net debt at 30 June 2018 stood at GBP30.2m (2017: GBP28.6m) and current leverage of Net Debt/EBITDA increased to 3.19 times (2017: 2.7 times) due to the decline in Underlying Group EBITDA (note 2). Our lenders, Bank of Scotland, agreed to amend the Net Debt/EBITDA covenant from 3.0x to 3.25x, to provide additional headroom in the quarterly tests until September 2018, after which the covenant will reduce back to 3.0x. The Group intends to reduce Net Debt/EBITDA throughout H2 2018.
Profit before tax before exceptional items declined by 38.2% to GBP1.6m (2017: GBP2.6m). Underlying Profit Before Tax (note 3) reduced by 39.5% to GBP1.7m (2017: GBP2.9m).
The Group incurred total exceptional costs of GBP2.7m (2017: nil). GBP2.2m of this was a non-cash asset impairment charge which relates to the sale of a non-core centre to a football club for use in a non-competing activity. It is envisaged that a significant element of the customer base will transfer to a nearby club and that the sale will result in an increase in profits. GBP0.5m was a cash charge relating to restructuring costs.
Earnings per share declined to (1.7p) (2017: 2.7p). Underlying earnings per share (note 4) declined by 38.7% to 1.9p (2017: 3.1p) principally due to the decline in Underlying Profit Before Tax (note 3) of 39.5%.
As working capital was managed tightly, Underlying free cash flow (note 5) increased by 22.0% to GBP2.5m (2017: GBP2.0m). The Group invested GBP1.8m (2017: GBP6.1m) in capital expenditure during the period all of which was invested in upgrading our mature centres. The Group invested GBP0.2m (2017: GBP0.2m) on software development and call centre systems during the year.
The Group's balance sheet remains well capitalised with net assets of GBP97.2m (2017: GBP93.0m). The Group has a long term non-amortising bank facility with Bank of Scotland of GBP42.5m which expires in July 2019. The directors plan to renew this facility during Q1 2019.
Dividend
The Board does not plan to declare an interim dividend for the period but does intend to recommence dividends when appropriate.
Michael Bolingbroke
Chairman
12 September 2018
Notes: Underlying and Adjusted Performance Measures
Management has presented the following performance measures as they are used throughout the Interim Results. Management believe that presentation of the Group's results in this way gives a better understanding of the Group's financial performance. This presentation is consistent with the way that financial performance is measured by management and reported to the Board and assists in providing a meaningful analysis of the trading results of the Group. This also facilitates comparison with prior periods to assess trends in financial performance more readily.
The Group applies judgement in identifying significant non-recurring items of income and expense that are recognised as exceptional or non-recurring to help provide an indication of the Group's underlying business. In determining whether an event or transaction is exceptional in nature, management considers quantitative as well as qualitative factors such as the frequency or predictability of occurrence.
Exceptional and non-recurring items have been identified as:
- Impairment of a specific club which is to be sold and is therefore considered to be exceptional and of a non-recurring nature. Exceptional costs of this nature are permissible add backs for the purposes of bank covenant calculation.
- Restructuring costs in relation to Board and SMT structure changes are not considered to be recurring, in particular due to the timeframe of this restructure relative to the last restructure in 2016. Exceptional costs of this nature are permissible add backs for the purposes of bank covenant calculation.
- Share based payments ("SBP") are added back for the purposes of the underlying calculations as they are not considered to be core business costs and are a permissible add back for the purposes of bank covenant calculation.
The performance measures outlined below are not defined performance measures in IFRS. A reconciliation from these alternative performance measures to the nearest measure prepared in accordance with IFRS is presented below. The Group's definition of each performance measure may not be comparable with similarly titled performance measures and disclosures by other entities.
Note 1: Sales
In July 2017, the Group entered into a joint arrangement with City Football Group Limited ("CFG") for a new company ("Goals City US Ltd") created and jointly controlled by Goals and CFG. The previously wholly owned subsidiary Goals Soccer Centers Inc ("Goals US") is now owned by Goals City US Limited ("Goals City US" or "the JV") with both parties (CFG and Goals) having a 50% ownership interest.
Given the change in Group structure, it is necessary to introduce some alternative performance measures that allow a greater degree of comparability between years. A Total System Sales comparative has been included below. This comparative assumes no change in ownership and includes sales of all clubs in the UK and USA.
We have also included a calculation which shows LFL performance on a total systems basis. Management and investors find this information to be useful when reviewing the underlying performance of the Group, especially Goals US performance. Clubs that have been opened for less than 12 months are removed from the comparison which allows a greater degree of comparability between years as sales are generated by the same number of clubs.
A Like for like ("LFL") sales comparative has been calculated which assumes the current ownership structure was in place in H1 2017, allowing a greater degree of comparability between years.
2018 2017
GBP000 GBP000
Total Sales 16,153 17,366
System Sales
Total Sales 16,153 17,366
Equity accounted investee (Jan - Jun 18) 1,042 -
Total System Sales 17,195 17,366
Clubs opened post 1 Jan 2017 (248) (114)
Clubs opened post 1 Jan 2018 (189) -
Like-for-like Total System Sales 16,758 17,252
Like-for-Like Sales
Total sales 16,153 17,366
Equity accounted investment (Jan - Jun 17) - (740)
Like-for-Like Sales 16,153 16,626
Underlying and Adjusted Performance Measures (continued)
Note 2: Underlying EBITDA
Underlying EBITDA is Earnings Before Interest, Tax, Depreciation and Amortisation adjusted for the impact of the exceptional and non-recurring costs and the effects of equity-settled share-based payments as shown below. In addition, the previously wholly owned subsidiary Goals Soccer Centers Inc is now owned by the JV with both parties (CFG and Goals) having a 50% ownership interest. Therefore 2017 comparatives have been adjusted to reflect the current ownership structure.
EBITDA is a common measure used by investors and analysts to evaluate the operating financial performance of companies. We consider underlying EBITDA to be a useful measure of our operating performance because it approximates the underlying operating cash flow by eliminating depreciation and amortisation.
2018 2017
GBP000 GBP000
Operating (loss)/profit (553) 2,793
Depreciation 1,619 1,676
Amortisation 181 78
Share option costs 48 32
Start-up losses (Pomona, USA) - 220
Restructuring costs 461 -
Impairment of club 2,226 -
EBITDA of equity accounted investee (Jan -
Jun 17) - (84)
Underlying EBITDA 3,982 4,715
Note 3: Underlying Profit Before Tax
Underlying PBT is Profit Before Taxation adjusted for the impact of the exceptional and non-recurring costs and the effects of equity-settled share-based payments as shown below. In addition, the previously wholly owned subsidiary Goals Soccer Centers Inc is now owned by the JV with both parties (CFG and Goals) having a 50% ownership interest. Therefore 2017 comparatives have been adjusted to reflect the current ownership structure.
Underlying PBT is a common measure used by investors and analysts to evaluate the operating financial performance of companies. We consider underlying PBT to be a useful measure of our profitability as it allows better analysis of the factors affecting the year's results compared to the prior period.
2018 2017
GBP000 GBP000
(Loss)/Profit Before Tax (1,080) 2,600
Share option costs 48 32
Start-up losses (Pomona, USA) - 220
Start-up losses (Rancho, USA) 78 -
Restructuring costs 461 -
Impairment of club 2,226 -
PBT of equity accounted investee (Jan - Jun
17) - 13
Underlying Profit Before Tax 1,733 2,865
Underlying and Adjusted Performance Measures (continued)
Note 4: Underlying Earnings per Share
Underlying earnings per share is earnings per share adjusted for the net of tax impact of the exceptional and non-recurring costs as shown below.
Earnings per share is calculated by dividing the underlying earnings attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the year plus the dilutive element of all outstanding relevant share options outstanding during the year. For the period ended 30 June 2018 this was 75,215,060 (2017: 75,215,060).
2018 2018 2017 2017
Underlying Underlying Underlying Underlying
Profit EPS Profit EPS
GBP000 p GBP000 p
Underlying Profit Before Tax 1,733 2,865
Tax impact of the exceptional
and non-recurring costs (292) (538)
PBT of equity accounted investee
(Jan - Jun 17) - 13
Underlying Profit After Tax 1,441 1.9 2,340 3.1
Note 5: Underlying Free Cash Flow
Underlying free cash flow is net cash flow from operating activities adjusted for the cash impact of the exceptional and non-recurring costs as shown below. The previously wholly owned subsidiary Goals Soccer Centers Inc is now owned by the JV with both parties (CFG and Goals) having a 50% ownership interest. Therefore 2017 comparatives have been adjusted to reflect the current ownership structure.
2018 2017
GBP000 GBP000
Net cash flow from operating activities 1,947 1,859
Start-up losses (Pomona, USA) - 220
Start-up losses (Rancho, USA) 78 -
Restructuring costs 461 -
EBITDA of equity accounted investee (Jan -
Jun 17) - (42)
Underlying Free Cash Flow 2,486 2,037
Note 6: Underlying Operating Profit
Underlying Operating Profit is Operating Profit adjusted for the impact of the exceptional and non-recurring costs as shown below. In addition, the previously wholly owned subsidiary Goals Soccer Centers Inc is now owned by the JV with both parties (CFG and Goals) having a 50% ownership interest. Therefore 2017 comparatives have been adjusted to reflect the current ownership structure.
Underlying Operating Profit is a common measure used by investors and analysts to evaluate the operating financial performance of companies. We consider Underlying Operating Profit to be a useful measure of our operating performance.
2018 2017
GBP000 GBP000
Operating (Loss)/Profit (553) 2,793
Share option costs 48 32
Start-up losses (Pomona, USA) - 220
Restructuring costs 461 -
Impairment of club 2,226 -
PBT of equity accounted investee (Jan - Jun
17) - 13
Underlying Operating Profit 2,182 3,058
Consolidated statement of comprehensive income
For the six months ended 30 June 2018
Before Exceptional Unaudited Unaudited Audited
exceptional items Total Total Year
items 6 months 6 months 6 months Ended
6 months Ended Ended Ended 31 December
Ended 30 30 June 30 June 30 June 2017
June 2018 2018 2017
Note 2018
GBP000 GBP000 GBP000 GBP000 GBP000
Revenue 16,153 - 16,153 17,366 33,058
Cost of sales (2,048) - (2,048) (2,109) (3,372)
Gross profit 14,105 - 14,105 15,257 29,686
Operating expenses 5/6 (11,971) (2,687) (14,658) (12,464) (23,661)
Operating (loss)/profit 2,134 (2,687) (553) 2,793 6,025
Financial expense (353) - (353) (193) (344)
Share of loss of equity-accounted
investees (174) (174) - (361)
Gain on sale of investment 6 - - - - 2,838
(Loss)/profit before
tax 1,607 (2,687) (1,080) 2,600 8,158
Taxation 3 (269) 88 (181) (581) (1,147)
(Loss)/profit for year
attributable to equity
holders of the parent 1,338 (2,599) (1,261) 2,019 7,011
============= =========== ========= ========= ============
Earnings per share 7
Basic (1.7p) 2.7p 9.3p
Consolidated statement of other comprehensive income
Unaudited Unaudited Audited
Total Total Year
6 months 6 months Ended
Ended 30 Ended 30 31 December
June June 2017
2018 2017 *As restated
GBP000 GBP000 GBP000
(Loss)/Profit for the year (1,261) 2,019 7,011
Items that will or may subsequently
be reclassified to profit or loss
Exchange differences on translation
of foreign operation - (699) 537
Other comprehensive income/(expense)for
the period - (699) 537
--------- ------- -------
Total comprehensive (loss)/income for
the period attributable to equity holders
of the parent (1,261) 1,320 7,548
========= ======= =======
*Restated to include recycling of translation differences on disposal of foreign operations from other comprehensive income to contributions by and distributions to owners
Consolidated statement of financial position
at 30 June 2018
Note Unaudited Unaudited Audited
30 June 30 June 31 December
2018 2017 2017
Assets GBP000 GBP000 GBP000
Non-current assets
Property, plant and equipment 8 114,913 119,369 117,059
Intangible assets 9 5,493 5,247 5,503
Other non-current receivables 10 824 708 58
Investments in equity-accounted
joint ventures 11 11,885 - 11,810
Total non-current assets 133,115 125,324 134,430
Current assets
Inventories 1,563 1,761 1,830
Trade and other receivables 13 3,000 6,540 3,559
Cash and cash equivalents 2,320 2,128 2,606
Total current assets 6,883 10,429 7,995
Non-current asset held
for sale 15 500 - -
---------
7,383 10,429 7,995
Total assets 140,498 135,753 142,425
========= ========= ===================
Equity
Share capital 188 188 188
Share premium 53,208 53,208 53,208
Retained earnings 43,795 40,004 45,013
Translation reserve - (375) -
Total equity 97,191 93,025 98,409
Liabilities
Non-current liabilities
Interest-bearing loans
and borrowings 30,553 28,842 30,410
Deferred tax liabilities 12 8,019 7,657 8,026
Total non-current liabilities 38,572 36,499 38,436
Current liabilities
Bank overdraft 1,942 1,910 1,955
Trade and other payables 14 2,366 3,729 2,979
Current tax payable 427 590 646
Total current liabilities 4,735 6,229 5,580
Total liabilities 43,307 42,728 44,016
Total equity and liabilities 140,498 135,753 142,425
========= ========= ===================
Consolidated statement of cash flows
For the six months ended 30 June 2018
Note Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended 31
30 June 30 June December
2018 2017 2017
GBP000 GBP000 GBP000
Cashflows from operating activities
(Loss)/Profit for the period (1,261) 2,019 7,011
Adjustments for:
Depreciation 8 1,619 1,676 3,300
Amortisation 9 181 78 262
Gain on sale of subsidiary - - (2,838)
Loss on disposal of pitches - - 172
Share of loss of equity-accounted
investee 174 - 361
Impairment of non-current asset
held for sale 15 2,226 - -
Financial expenses 353 193 344
Income tax charge 181 581 1,147
Equity settled share based payment
transactions 48 28 -
3,521 4,575 9,759
(Increase)/decrease in trade
and other receivables (207) (391) 393
Decrease/(increase) in inventory 267 (319) (397)
(Decrease)/increase in trade
and other payables (1,234) (1,581) (2,963)
2,347 2,284 6,792
Income tax paid (400) (425) (616)
Net cash from operating activities 1,947 1,859 6,176
--------- --------- ---------
Cashflows from investing activities
Acquisition of property, plant
and equipment 8 (1,839) (6,129) (10,808)
Software development 9 (171) (166) (760)
Disposal of subsidiary - - (80)
Net cash used in investing activities (2,010) (6,295) (11,648)
--------- --------- ---------
Cashflows from financing activities
Share related costs - - 50
Proceeds from bank borrowings 17 2,538 6,744 9,865
Repayment of bank borrowings 17 (2,395) (1,900) (3,453)
Interest paid (353) (193) (344)
Net cash (used in)/from financing
activities (210) 4,651 6,118
--------- --------- ---------
Net (decrease)/increase in cash
and cash equivalents (273) 213 646
Cash and cash equivalents at
start of period 651 5 5
Cash and cash equivalents at
end of period 378 218 651
========= ========= =========
Consolidated statement of changes in equity
for the six months ended 30 June 2018
Share Share Retained Translation Total
capital premium earnings reserve
account
GBP000 GBP000 GBP000 GBP000 GBP000
Group
At 1 January 2018 (audited) 188 53,208 45,013 - 98,409
Comprehensive income for
the period
Loss for the year attributable
to owners of the parent - - (1,261) - (1,261)
Exchange difference on translation - - - - -
of foreign operation
Other comprehensive income - - - - -
Total comprehensive income
for the period - - (1,261) - (1,261)
Contributions by and distributions
to owners
Share based payments - - 48 - 48
Deferred tax on share based
payments - - (5) - (5)
Total transactions with owners - - 43 - 43
At 30 June 2018 (unaudited) 188 53,208 43,795 - 97,191
Group
At 1 January 2017 (audited) 188 53,208 37,957 324 91,677
Comprehensive income for
the period
Profit for the year attributable
to owners of the parent - - 2,019 - 2,019
Exchange difference on translation
of foreign operation - - - (699) (699)
Other comprehensive income - - - - -
Total comprehensive income
for the period - - 2,019 (699) 1,320
Contributions by and distributions
to owners
Share based payments - - 32 - 32
Deferred tax on share based
payments - - (4) - (4)
Total transactions with
owners - - 28 - 28
At 30 June 2017 (unaudited) 188 53,208 40,004 (375) 93,025
Consolidated statement of changes in equity
for the six months ended 30 June 2018 (continued)
Share Share Retained Translation Total
capital premium earnings reserve
account *As restated
GBP000 GBP000 GBP000 GBP000 GBP000
Group
At 1 January 2017 (audited) 188 53,208 37,957 324 91,677
Comprehensive income for
the period
Profit for the year attributable
to owners of the parent - - 7,011 - 7,011
Exchange difference on translation
of foreign operation - - - 537 537
Total comprehensive income
for the period - - 7,011 537 7,548
Contributions by and distributions
to owners
Recycling of translation
differences on disposal
of foreign operation - - - (861) (861)
Share based payments - - 50 - 50 Deferred tax on share based payments - - (5) - (5) Total transactions with owners - - 45 (861) (816) At 31 December 2017 (audited) 188 53,208 45,013 - 98,409
*Restated to include recycling of translation differences on disposal of foreign operations from other comprehensive income to contributions by and distributions to owners
Notes to the Unaudited Interim Results
Goals Soccer Centres plc (the "Company") is a company domiciled in the United Kingdom.
1. Significant accounting policies
Basis of preparation
The financial information in this interim report comprises the Consolidated Statement of Profit or Loss and Other Comprehensive Income, the Consolidated Statement of Other Comprehensive Income, the Consolidated Statement of Financial Position, the Consolidated Statement of Changes in Equity, the Consolidated Statement of Cashflows and accompanying notes. The financial information in this interim report has been prepared under the recognition and measurement requirements of IFRSs as adopted for use in the European Union but does not include all of the disclosures that would be required under those accounting standards. The Company has elected not to prepare the interim report in accordance with IAS 34 as adopted by the EU. The accounting policies adopted in the financial information are consistent with those expected to be adopted in the Company and Group's financial statements for the year ended 31 December 2018. The accounting policies are unchanged from those used in the Company and Group's financial statements for the year ended 31 December 2017, except for those that relate to new standards and interpretations effective for the first time for periods beginning on (or after) 1 January 2018 and that will be adopted in the annual financial statements for the year ended 31 December 2018.
The financial information in this interim report for the six months to 30 June 2018 and to 30 June 2017 has not been audited, but it has been reviewed by the Company and Group's auditor, whose report is set out on page 31. Any comparative figures for the year ended 31 December 2017 are extracted from the Group's audited financial statements for that period as filed with the Registrar of Companies. The financial information for the year ended 31 December 2017 does not constitute the Company and Group's financial statements for that period but is derived from them.
The Company and Group's statutory financial statements for the year ended 31 December 2017 have been filed with the Registrar of Companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of an emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006.
New standards impacting the Group that will be adopted in the annual financial statements for the year ended 31 December 2018, and which have given rise to changes in the Group's accounting policies are:
- IFRS 9 Financial Instruments; and - IFRS 15 Revenue from Contracts with Customers
Details of the impact these two standards have had are given below.
IFRS 9 Financial instruments
The standard simplifies the classification, recognition and measurement requirements for financial assets, financial liabilities and some contracts to buy or sell non-financial items, replacing IAS 39 Financial Instruments: Recognition and Measurement. The introduction of this new standard has not resulted in any change in accounting policies or had an impact on the results for the period ended 30 June 2018.
Classification - financial assets
IFRS 9 contains a new classification and measurement approach for financial assets that reflects the business model in which assets are managed and their cash flows characteristics. Implementing this standard has not had a material impact on the accounting for trade receivables and loans.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Impairment - financial assets and contract assets
IFRS 9 replaces the 'incurred loss' model in IAS 39 with a forward looking 'expected credit loss' (ECL) model. This will require considerable judgement about how changes in economic factors affects ECLs, which will be determined on a probability-weighted basis.
Under IFRS 9, loss allowances are measured on either of the following bases:
- 12-month ECLs: these are ECLs that return from possible default events within the 12 months after the reporting dates: and
- Lifetime ECLs: these are ECLs that result from all possible default events over the expected life of a financial instrument.
Lifetime ECL measurement applies if the credit risk of a financial asset at the reporting date has increased significantly since initial recognition and 12-month ECL measurement applies if it has not.
Group cash and cash equivalents are held with banks which are rated "A" based on Standard & Poor's ratings. The Group considers that cash and cash equivalents have a low credit risk based on the external credit ratings of the counterparties.
Given that the Group has a good history of cash collection from debtors, bad debts have not been material and cash is held with "A" rated banks, impairment losses have not increased significantly since the adoption of this standard.
Classification - financial liabilities
IFRS 9 largely retains the existing requirements in IAS 39 for the classification of financial liabilities. However, under IAS 39 all fair value changes of liabilities designates as fair value through profit and loss ("FVTPL") are recognised in profit or loss, whereas under IFRS 9 these fair value changes are generally presented as follows:
- The amount of change in the fair value that is attributable to changes in the credit risk of the liability is presented in other comprehensive income ("OCI"); and
- The remaining amount of change in the fair value is presented in profit or loss.
The Group has not designated any financial liabilities at FVTPL and it has no current intention to do so.
IFRS 15 Revenue from Contracts with Customers
The standard specifies whether, how much and when revenue is recognised, using a principles based five-step model, replacing IAS 18 Revenue and IAS 11 Construction Contracts as well as various Interpretations previously issued by the IFRS Interpretations Committee. The Group has adopted the standard on a fully retrospective basis. The introduction of this new standard has not resulted in any change in accounting policies or had an impact on the results for the period ended 30 June 2018.
Sale of goods
The Group generates revenue from the sale of a number of goods off the back of customers utilising the Group's next generation football facilities. Secondary revenue lines include: hot and cold snacks; soft drink vending; confectionery vending; bar revenue and revenue from sales of football equipment. Revenue is recognised for secondary sales at the time the goods change hands, in line with IFRS 15 which stipulates that revenue will be recognised when a customer obtains control of the goods.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Rendering of services
The primary revenue stream of the Group is the utilisation of the football facilities including: revenue from leagues operated by the Group; revenue from customers who use the facilities to play on a non-league basis; corporate events; children's birthday parties; and children's coaching. Revenue is recognised for use of the football facilities when each game is complete. The introduction of IFRS 15 has had no significant impact on the recognition of revenue generated by the rendering of services.
Other income
The Group recognises revenue in respect of goods and services received under sponsorship and partnership agreements based on amounts invoiced in line with the terms of the contract. Revenue is recognised at the point of invoice as this signifies the completion of the performance obligations of the contract. The introduction of IFRS 15 has had no significant impact on the recognition of revenue generated by the sponsorship and partnership agreements in place during the period ended 30 June 2018.
Other standards
The following new standards, amendments and interpretations are effective for the first time in these interim statements but none have had a material effect on the Group and so have not been discussed in detail:
- Annual Improvements to IFRS 2014-2016 Cycle - Amendments to IFRS 1 and IAS 28 - Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS2) - Transfers of Investment Property (Amendments to IAS 40) - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture - IFRIC 22 Foreign Currency Transactions and Advance Consideration - IFRIC 23 Uncertainty over Income Tax Treatments - Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts (Amendments to IFRS 4)
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
New standards applicable for future period
IFRS 16 Leases
The Group is required to adopt IFRS 16 Leases from 1 January 2019. IFRS 16 introduces a single, on-balance sheet lease accounting model for lessees effective for the Group's year ending 31 December 2019. A lessee recognises a right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. There are recognition exemptions for short-term leases and leases of low-value items which are not applicable to the Group. In addition, the standard introduces a depreciation charge for right-of-use assets and interest expense on lease liabilities.
Based on the initial assessment, the application of IFRS 16 is expected to have a significant effect on the financial statements, increasing the Group's recognised assets and liabilities and materially increasing Group operating profit whilst reducing Group Profit Before Tax. However the actual impact of applying IFRS 16 on the financial statements in the period of initial application will depend on future economic conditions, including the Group's borrowing rate at 1 January 2019 and the composition of the Group's lease portfolio at that date.
The Group can either apply the standard using a retrospective approach or a modified retrospective approach with optional practical expedients. The Group will apply the election consistently to all of its leases. The initial assessment completed has used a modified retrospective approach and it is likely that this will be approach adopted by the Group.
Other new standards
A number of new standards, amendments to standards and interpretations are not yet effective for period ended 30 June 2018 or 31 December 2018 and have not been applied in preparing these interim results.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Going concern
The Group and Company meet their overall funding requirements through the capital market and their banking facility arrangements. The Group has a long term non-amortising bank facility with Bank of Scotland of GBP42.5m which expires in July 2019. Discussions have commenced with regards to renewing the facility.
During the period, Goals agreed with its lenders to amend its Net Debt/EBITDA covenant from 3.0x to 3.25x, to provide additional headroom in the quarterly tests in June and September 2018, after which the covenant will reduce back to 3.0x. This will allow the continuation of the arena and clubhouse modernisation projects into H2 2018.
Following a challenging first half of the year, as a result of inclement weather and its knock on effects, the directors have reassessed the company's funding position and requirements in light of the strategic capital investment programme in its estate, with reference to future trading projections and the terms and covenants of the borrowing facilities. The directors are confident that the company will operate within the terms and covenants of the existing facilities and will renew those facilities when their current term expires in July 2019. Accordingly, the directors consider it appropriate to continue to adopt the going concern basis of accounting in preparing these interim results.
Basis of consolidation
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. In assessing control, the Group takes into consideration potential voting rights that are currently exercisable. The acquisition date is the date on which control is transferred to the acquirer. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
Loss of control
When the Group loses control over a subsidiary, it derecognises the assets and liabilities of the subsidiary, and any other components of equity. Any resulting gain or loss is recognised in profit and loss. Any interest retained in the former subsidiary is measured at fair value when control is lost.
In July 2017, Goals entered into a strategic 50:50 Joint Venture with CFG, the global football group which owns a number of leading football clubs including Manchester City and New York City, to accelerate the growth of the Goals brand in North America. A separate entity, Goals City US Limited has been created as the Joint Venture vehicle. Goals Soccer Centers Inc, the previously wholly owned subsidiary, was disposed of by the Group at 31 July 2017, with share ownership transferring to Goals City US Limited. The transaction and associated costs resulted in a gain on sale of GBP2.8m, in the year to 31 December 2107, which was treated as exceptional.
Goals considered the different accounting policy choices available in respect of such transactions and has applied IFRS10 in accounting for the gain on disposal of the subsidiary.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Basis of consolidation (continued)
Interest in equity-accounted investees
The Group's interests in equity-accounted investees comprises of interest in a joint venture. A joint venture is an arrangement in which the Group has joint control, whereby the Group has rights to the net assets of the arrangement, rather than rights to its assets and obligations for its liabilities.
Interest in the joint venture is accounted for using the equity method. It is initially recognised at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group's share of the profit or loss and OCI of equity-accounted investee, until the date on which joint control ceases.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated. Unrealised gains arising from transactions with equity-accounted investees are eliminated against the investment to the extent of the Group's interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.
Revenue
Revenue represents the value of goods and services supplied to customers (net of applicable Value Added Tax). The Group's revenue comprises revenues from customers' utilising the Group's next generation football facilities and secondary revenue associated with this utilisation.
Revenue from utilisation of the football facilities includes: revenue from leagues operated by the Group; revenue from customers who use the facilities to play on a non-league basis; corporate events; children's birthday parties; and children's coaching. Revenue is recognised for use of the football facilities when each game is complete.
Secondary revenue includes: hot and cold snacks; soft drink vending; confectionery vending; bar revenue and revenue from sales of football equipment. Revenue is recognised for secondary sales at the time the goods change hands.
The Group recognises revenue in respect of goods and services received under sponsorship and partnership agreements based on amounts invoiced in line with the terms of the contract. Revenue is recognised at the point of invoice as this signifies the completion of the performance obligations of the contract.
Business segments
The Group operates primarily in the UK and its only trading activity is the operation of soccer centres.
Exceptional items
Items which are material either because of their size or their nature, and which are non-recurring, are presented within their relevant consolidated income statement category, but highlighted through separate disclosure. The separate reporting of exceptional items helps provide a better picture of the Group's underlying performance. Items which are included within the exceptional category include:
- Costs associated with major restructuring programmes; - Significant impairment charges in relation to goodwill, intangible or tangible assets; - Other particularly significant or unusual items.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Taxation
The tax expense represents the sum of the current taxes payable and deferred tax.
The current tax payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method.
Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised or increased. The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity. Deferred tax assets and liabilities are offset to the extent that there is a legal right of offset.
Income tax in the interim period is calculated using the tax rate that would be applicable to expected total annual pre-tax results.
Intangible assets - goodwill
Goodwill on acquisitions represents the excess of the cost of acquisition over the Group's interest in the fair value of the identifiable assets and liabilities and contingent liabilities at the date of acquisition. Goodwill is stated at cost less any accumulated impairment losses. Goodwill is tested annually for impairment. Impairment is first allocated to goodwill and then to other assets in the cash generating units on a pro-rata basis.
The value of Goodwill is reviewed at each balance sheet date to determine whether there is an indication of impairment. An impairment is recognised whenever the carrying amount of the asset exceeds its recoverable amount. The recoverable amount of a cash generating unit is the greater of the value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the cash-generating unit.
Any impairment is recognised immediately in the statement of profit or loss and is not subsequently reversed.
Intangible assets - other
Other intangible assets that are acquired by the Group are stated at cost less accumulated amortisation and impairment losses. Software development costs comprise of third party consultancy costs incurred in acquiring, bringing to use and developing the functionality of the Group's internal ERP system. Impairment testing is performed where an indication of impairment arises.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Amortisation
Amortisation is charged to the statement of profit and loss on a straight line basis over the estimated useful lives of intangible assets unless such lives are indefinite. Intangible assets with an indefinite useful life and goodwill are systematically tested for impairment at each balance sheet date. Other intangible assets are amortised from the date they are available for use. The estimated useful life of the software development assets is ten years for the Smart Centre system and five years for the App and website.
Property, plant and equipment
Items of property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition or construction of the asset. Borrowing costs directly attributable to the acquisition or construction of qualifying assets are capitalised during the period of construction. Depreciation is charged to the statement of profit and loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Previous experience with regards to the wear and tear of pitches has been taken into consideration when deciding their estimated useful lives. For other assets, physical deterioration due to the passage of time and assets becoming obsolete due to changes in technology have been considered. The estimated useful lives are as follows:
Freehold and leasehold - 75 years or lease period if shorter buildings Fixtures and fittings: - shock pads - 30 years - 11-a-side pitches 20 years - 5 and 7-a-side pitches - 10 years - office furnishings - 10 years - fixtures and fittings - 10 years - computer equipment - 4 years - plant and machinery - 4 years
The value of each centre is reviewed at each balance sheet date to determine whether there is an indication of impairment. An impairment is recognised whenever the carrying amount of the asset exceeds its recoverable amount. The recoverable amount of a cash generating unit is the greater of the value in use and fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and risks specific to the cash-generating unit.
Assets under construction are transferred to the relevant asset category when they become operational and are depreciated from that date.
Dividends on shares presented within shareholders' funds
Dividends unpaid at the balance sheet date are only recognised as a liability at that date to the extent that they are appropriately authorised and are no longer at the discretion of the Company. Unpaid dividends that do not meet these criteria are disclosed in the notes to the financial statements.
Notes to the Unaudited Interim Results
1. Significant accounting policies (continued)
Earnings per share
The company presents basic and diluted earnings per share (EPS) data for ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of shares outstanding for the effects of all dilutive potential ordinary shares which comprise share options granted to employees.
Non-current receivables
Non-current receivables are amounts recognised under the VAT Capital Goods Scheme on capital expenditure incurred by the Group in line with its taxable use over a period of time.
AIM Rule 26
From 28 September 2018, all AIM companies must adopt a recognised code of corporate governance. The Board have concluded that the QCA Corporate Governance Code (2018) ("QCA") is the most appropriate code for the Group to follow. The Board have considered the principles set out in the QCA, in conjunction with the existing governance framework of the Group and are satisfied that the company's governance structures and practices align with the expectations set by the QCA Code.
2. Segmental reporting
IFRS 8 'Operating Segments' requires a "management approach" under which segment information is presented on the same basis as that used for internal reporting purposes to the Chief Operating Decision Maker, which is the Board. As each club has similar economic characteristics, provides the same services to similar customers and operates in a similar manner, the directors, therefore, consider that there is one reporting segment relating to the operation of outdoor soccer centres which includes the three (2017: two) clubs outside of the UK owned by the Joint Venture.
3. Tax
Corporation tax for the interim period is charged at 19% (June 2017: 19.5%), representing the estimated effective tax rate for the full financial year.
A reduction in the UK corporation tax rate from 21% to 20% (effective from 1 April 2015) was substantively enacted on 2 July 2013. Further reductions to 19% (effective from 1 April 2017) and to 18% (effective 1 April 2020) were substantively enacted on 26 October 2015, and an additional reduction to 17% (effective 1 April 2020) was substantively enacted on 6 September 2016. This will reduce the company's future current tax charge accordingly. The deferred tax liability at 30 June 2018 has been calculated based on these rates.
Notes to the Unaudited Interim Results
4. Dividends
No interim dividend is proposed for the period ended 30 June 2018 (2017: GBPnil).
5. Exceptional items - operating expenses
6 months 6 months (Audited)
ended ended Year
30 June 30 June ended
2018 2017 31 December
2017
GBP000 GBP000 GBP000
Exceptional items comprise:
* Impairment of club 2,226 - -
- Restructuring costs 461 - -
2,687 - -
In June 2018, Goals agreed Heads of Terms to dispose of a non-core club to a professional football club for use in a non-competing activity. It is envisaged that a significant element of the existing customer base will transfer to a nearby club and that the sale will result in an increase in profits. The transaction values the club at GBP0.5m. The fair value less cost of disposal is therefore GBP0.5m, resulting in an impairment loss of GBP2.2m. Goals will continue to operate the club until May 2019.
In 2018, GBP0.5m of Board and Senior Management Team restructuring costs were incurred.
6. Exceptional items - other
6 months 6 months (Audited)
ended ended Year
30 June 30 June ended
2018 2017 31 December
2017
GBP000 GBP000 GBP000
Exceptional items comprise:
* Gain on sale of Goals Soccer Centers Inc - - (2,838)
- - (2,838)
In July 2017, Goals entered into a strategic 50:50 Joint Venture with CFG, the global football Group which owns a number of leading football clubs including Manchester City and New York City, to accelerate the growth of the Goals brand in North America. A separate entity, Goals City US Limited has been created as the Joint Venture vehicle. Goals Soccer Centers Inc, the previously wholly owned subsidiary, has been disposed of by the Group with share ownership transferring to Goals City US Limited. The transaction and associated costs has resulted in a gain on sale of GBP2.8m which has been treated as exceptional.
Notes to the Unaudited Interim Results
7. Earnings per share
Basic and diluted earnings per share
Unaudited Unaudited (Audited)
Total 6 months Total 6 Year
ended 30 months ended
June ended 30 31 December
2018 June 2017
2017 *As restated
*As restated
(Loss)/Profit for the financial
period (GBP'000) (1,261) 2,019 7,011
________ _________ _________
Weighted average number of
shares 75,215,060 75,215,060 75,215,060
Dilutive share options - - -
________ _________ _________
75,215,060 75,215,060 75,215,060
Basic earnings per share (1.7p) 2.7p 9.3p
Diluted earnings per share (1.7p) 2.7p 9.3p
Diluted earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the year plus the dilutive element of all outstanding relevant share options outstanding during the year.
At each respective period end, the options are not in the money, therefore there is no dilutive element.
*Restated to include recycling of translation differences on disposal of foreign operations from other comprehensive income to contributions by and distributions to owners
Notes to the Unaudited Interim Results
8. Property, plant and equipment
Land and Fixtures Assets in Total
buildings and fittings course of
construction
GBP000 GBP000 GBP000 GBP000
Cost
At beginning of period (Audited) 132,719 20,282 3,449 156,450
Additions 56 1,712 431 2,199
Transfers (assets under construction) - 681 (681) -
Transfers (held for sale
asset) (3,070) (427) - (3,497)
At end of period (Unaudited) 129,705 22,248 3,199 155,152
Depreciation and impairment
At beginning of period 29,408 7,933 2,050 39,391
Charge for period 1,006 613 - 1,619
Transfers (held for sale
asset) (428) (343) - (771)
At end of period (Unaudited) 29,986 8,203 2,050 40,239
Net book value
At 30 June 2018 (Unaudited) 99,719 14,045 1,149 114,913
At 31 December 2017 (Audited) 103,311 12,349 1,399 117,059
Assets in the course of construction comprise the cost of redevelopment
of current sites, in particular, costs associated with the ongoing
arena and clubhouse modernisation projects.
9. Intangible assets
Goodwill Software Total
development
GBP000 GBP000 GBP000
Cost
At beginning of period (Audited) 5,719 5,420 11,139
Additions - 171 171
At end of period (Unaudited) 5,719 5,591 11,310
Amortisation and impairment
At beginning of period (Audited) 3,100 2,536 5,636
Charge for period - 181 181
At end of period (Unaudited) 3,100 2,717 5,817
Net book value
At 30 June 2018 (Unaudited) 2,619 2,874 5,493
At 31 December 2017 (Audited) 2,619 2,884 5,503
Notes to the Unaudited Interim Results
10. Other non-current receivables
Unaudited Unaudited (Audited)
Total 6 months Total 6 Year
ended 30 months ended
June ended 31 December
2018 30 June 2017
2017
GBP000 GBP000 GBP000
Capital Goods Scheme 824 708 58
11. Equity-accounted investment
Unaudited Unaudited (Audited)
Total 6 months Total 6 Year
ended 30 months ended
June ended 31 December
2018 30 June 2017
2017
GBP000 GBP000 GBP000
Current
Interest in Joint Venture 11,885 - 11,810
On 25 July 2017, the Group entered into a joint arrangement with City Football Group Limited ("CFG") to accelerate the growth of the Goals brand in North America.
A new company - Goals City US Ltd - was created and is jointly controlled by Goals and CFG with both parties having a 50% ownership interest. The board has six members, three each from Goals and CFG. The Chairman has no casting vote.
Given that the arrangement is structured through a separate vehicle, the contractual agreement is such that both parties' liability is limited to their shareholding and the arrangement is not reliant on either party to generate revenue. The arrangement has been accounted for as a joint venture and has been consolidated on an equity-accounted basis.
Notes to the Unaudited Interim Results
12. Deferred tax liability
Deferred tax assets and liabilities are attributable to the following:
Unaudited Unaudited (Audited)
Total 6 months Total 6 months Year
ended 30 ended 30 ended
June June 31 December
2018 2017 2017
GBP000 GBP000 GBP000
Property, plant and equipment (8,035) (7,680) (8,048)
Share based payments (7) - (1)
Other temporary differences 23 23 23
Net deferred tax liabilities (8,019) (7,657) (8,026)
13. Trade and other receivables
Unaudited Unaudited (Audited)
Total 6 months Total 6 months Year
ended 30 ended 30 ended
June June 31 December
2018 2017 2017
GBP000 GBP000 GBP000
Trade receivables 1,078 1,069 1,409
Prepayments and accrued income 1,410 3,153 1,552
Other receivables 512 2,318 598
3,000 6,540 3,559
14. Trade and other payables
Unaudited Unaudited (Audited)
Total 6 months Total 6 months Year
ended 30 ended 30 ended
June June 31 December
2018 2017 2017
GBP000 GBP000 GBP000
Trade payables 1,973 2,791 2,120
Taxation and social security 190 3 35
Other payables 91 203 253
Accruals and deferred income 112 732 571
2,366 3,729 2,979
15. Disposal group held for sale
In June 2018, Goals agreed Heads of Terms to dispose of a non-core club to a professional football club for use in a non-competing activity. The disposal is in relation to the PP&E of the club, no other assets or liabilities will be disposed of at this time. It is envisaged that a significant element of the existing customer base of this club will transfer to a nearby club and that the sale will result in an increase in profits. Goals will continue to operate the club until May 2019 at which point all other assets and liabilities attributable to the club will be disposed of. The club PP&E is therefore classified as held for sale as at 30 June 2018, with the PP&E of the club impaired to reflect the fair value less cost of disposal.
Unaudited
Total 6
months
ended
30 June
2018
GBP000
Fair value less cost of disposal 500
Net assets to be disposed of
Property, plant and equipment 2,726
Impairment of PP&E 2,226
Notes to the Unaudited Interim Results
16. Related Party Transactions
Amounts owed by related parties
30 June 2018 30 June 2017 31 December
2017
GBP000 GBP000 GBP000
Goals Soccer Centers Inc 31 6,026 -
Goals City US Ltd 5 - -
Following the completion of the joint venture with CFG in July 2017, any amounts owed by Goals Soccer Centers Inc were capitalised.
17. Notes supporting statement of cash flows
Cash and cash equivalents for purposes of the statement of cash flows comprises:
Unaudited Unaudited Total (Audited)
Total 6 months 6 months Year
ended 30 ended 30 June ended
June 2017 31 December
2018 2017
GBP000 GBP000 GBP000
Cash at bank and in hand 2,320 2,128 2,606
Overdraft (1,942) (1,910) (1,955)
_______ ________ ________
Cash and cash equivalents 378 218 651
Non-cash transactions from financing activities are shown in the reconciliation of liabilities from financing transactions below:
Loans and
Borrowings
GBP000
At 1 January 2018 30,410
Cash Flows
Proceeds from bank borrowings 2,528
Repayments from bank borrowings (2,395)
Non-cash Flows
Amortisation of finance costs 10
________
At 30 June 2018 30,553
INDEPENDENT REVIEW REPORT TO GOALS SOCCER CENTRES PLC
Introduction
We have been engaged by the company to review the condensed set of financial statements in the interim results for the six months ended 30 June 2018 which comprise the consolidated statement of comprehensive income, the consolidated statement of other comprehensive income, the consolidated statement of financial position, the consolidated statement of cash flows, the consolidated statement of changes in equity and the related notes.
We have read the other information contained in the interim results and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
Directors' responsibilities
The interim results, including the financial information contained therein, is the responsibility of and has been approved by the directors. The directors are responsible for preparing the interim results in accordance with the rules of the London Stock Exchange for companies trading securities on AIM which require that the interim results be presented and prepared in a form consistent with that which will be adopted in the company's annual financial statements having regard to the accounting standards applicable to such annual financial statements.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the interim results based on our review.
Our report has been prepared in accordance with the terms of our engagement to assist the company in meeting the requirements of the rules of the London Stock Exchange for companies trading securities on AIM and for no other purpose. No person is entitled to rely on this report unless such a person is a person entitled to rely upon this report by virtue of and for the purpose of our terms of engagement or has been expressly authorised to do so by our prior written consent. Save as above, we do not accept responsibility for this report to any other person or for any other purpose and we hereby expressly disclaim any and all such liability.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity", issued by the Financial Reporting Council for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the interim results for the six months ended 30 June 2018 is not prepared, in all material respects, in accordance with the rules of the London Stock Exchange for companies trading securities on AIM.
BDO LLP
Chartered Accountants
Glasgow, UK
12 September 2018
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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(END) Dow Jones Newswires
September 12, 2018 02:01 ET (06:01 GMT)
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