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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Moss Bros Group Plc | LSE:MOSB | London | Ordinary Share | GB0006056104 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 21.60 | 21.80 | 22.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMMOSB
RNS Number : 0165S
Moss Bros Group PLC
28 September 2017
For Immediate Release 28 September 2017
MOSS BROS GROUP PLC
Half Yearly Results for the 26 weeks ended 29 July 2017
Continued Progress
Moss Bros Group PLC ("the Group"), the 'first choice for men's tailoring', today announces its half yearly results, covering the period from 29 January 2017 to 29 July 2017.
The Group's overall trading performance has continued to show improvement on the prior year, in line with the Board's expectations. Retail sales growth, including e-commerce, continues to underpin the positive performance.
Financial Highlights
-- Total Group revenue, excluding VAT, was up 4.3% on the previous year to GBP66.6m. -- Group like-for-like* sales increased 2.8% -- Like-for-like* retail sales, including e-commerce were up 5.1%
-- E-commerce retail sales for the first half grew 14.5% on the prior year and now represent 11.2% of total sales.
-- Like for like* hire sales, which represent 12.8% of total sales in the half on a cash taken basis were -8.4% down.
-- Retail gross margin was up 0.1% for the half despite having re-introduced a mid-season Sale in response to a much tougher trading environment during the earlier part of the season.
-- Overall gross margins were down -0.7%, impacted by the hire sales reduction year on year where fixed depreciation costs relating to hire garments remain constant regardless of the level of sales.
-- Operating profit was up 16.6% to GBP4.2m (HY1 2016 GBP3.6m) -- Similarly, pre-tax profit was up 15.7% to GBP4.2m (HY1 2016 GBP3.7m)
-- Effective cash management ongoing, with cash balance of GBP21.5m at the end of the half (HY1 2016 GBP21.1m)
-- In line with the progressive dividend policy, interim dividend increased by 6.3% to 2.03 pence per share (30 July 2016: 1.91 pence per share)
Operational Highlights
-- Ongoing investment in our brand identity and continuing investment in our retail estate through our store opening and refit programmes delivered a strong platform from which to leverage our continually improving product offer.
-- 4 new stores opened during the half, 2 were relocated and 2 closed. 129 stores were open and trading at 29 July 2017 (30 July 2016: 125 stores)
-- E-commerce sales continue to grow alongside site visitor traffic, particularly on mobile devices.
-- 'Tailor Me' custom tailoring service now an established part of the in-store offer.
Current trading
-- Retail like-for-like* sales, including VAT, in the first 8 weeks to 23 September 2017 are up 3.5%.
-- Hire like for like*, reported on a 'cash taken' basis, is -4.7% down in the first 8 weeks of the second half.
-- Early responses to the Autumn/Winter 2017 range across Retail are positive -- The Group's trading performance continues in line with the Board's expectations.
Commenting on the results and outlook, Brian Brick, Chief Executive Officer, said:
"We are pleased with the performance of Moss Bros during the first half in what was a very tough trading environment. The early response to the 2017 Autumn/Winter ranges has been encouraging and we continue to see our retail like-for-like* sales improve.
We remain acutely aware that market conditions remain tough, with a highly competitive retail landscape set to continue alongside an unpredictable economic back-drop. There are significant cost headwinds, driven by National Living Wage, the Apprenticeship Levy and weaker sterling.
We remain agile in our trading approach, whilst continuing to invest wisely in our future growth.
The Group's trading performance continues in line with the Board's expectations.
I would like to thank all of our people for their continued dedication, hard work and contribution to delivering these results."
*Like-for-like (including VAT) represents financial information for e-commerce and stores open during both the current and prior financial periods and compares 26 weeks against 26 weeks, except for stores refitted in the period, where the period closed for refit is excluded from both the current and prior financial periods. Like-for-like Hire and Tailor Me sales are calculated on cash receipts in the period, before adjustment for the movement in the level of deposits held.
***EBITDA is earnings before interest, tax, depreciation, amortisation and exceptional items
For further information please contact:
Moss Bros Group Plc: 0207 447 7200
Brian Brick, Chief Executive Officer
Tony Bennett, Finance Director
Buchanan: 0207 466 5000
Charles Ryland/Victoria Hayns/Catriona Flint
INTERIM MANAGEMENT REPORT
FOR THE 26 WEEKS TO 29 JULY 2017
OVERVIEW
Moss Bros Group PLC retails and hires formal wear and fashion products for men, predominantly in the UK, with retail sales comprising 87%, and Hire 13%, of total sales. The Group retails own brand and third party brand menswear through the Moss Bros fascia, and hires formal wear under the Moss Bros Hire brand through its mainstream stores. The Group also trades through the premium Savoy Taylors Guild fascia in a small number of stores.
Sub brands of Moss London, Moss 1851 and Moss Esquire are now fully established. These sub brands, combining with Savoy Taylors Guild, have created an authoritative and complementary customer offer across a range of fits and prices, underpinning our expertise in formalwear, under the Moss Bros master brand.
The 'Tailor Me' personalisation service launched during 2016 is now available nationwide. It is a simplified set of bespoke options offering a custom made suit, ready for collection within 30 days of placing an order.
REVIEW OF THE FIRST HALF
Profit before tax from continuing operations for the six months to 29 July 2017 was GBP4.2m, a 16% increase on last year (HY1 2016: GBP3.7m) driven mainly by strong retail sales growth from both like-for-like* stores, new space and e-commerce underpinned by careful and targeted promotional activity.
The business performed well in the first half against strong comparatives last year and in one of the most competitive retail environments which we have seen for some time. Whilst confident in the value which our regular pricing architecture offers, we re-introduced the spring mid-season sale, ensuring that we were able to offer the best value possible to customers during the half.
Our store teams are increasingly focussed on offering solutions to customers for whatever their occasion or need, whether they choose to buy, hire or 'Tailor Me'. Whilst we cannot know for sure the original intention of customers coming to our stores, more customers are ultimately choosing to buy rather than hire their suits. This is in part reflected in the reduction in hire sales on a like-for-like* basis versus the previous year.
E-commerce continued to achieve strong growth on last year through an increase in visitor numbers. We continue to develop our online capabilities and are particularly conscious of addressing the increasing proportion of shoppers who visit our site via mobile devices.
Trading performance
Total revenue increased by 4.3% in the six months to 29 July 2017 to GBP66.6m (HY1 2016: GBP63.8m). Like for like* retail sales performed well, increasing by 5.1%. Moss Bros Hire, the leading brand name in formal hire, recorded a like for like* sales decrease of 8.4%, although the effect of a later Easter and our "GBP10 Deposit" offer are still yet to fully wash through as the Wedding season does not end fully until the end of September. Across the Group, total like for like* sales were up 2.8% in the first half.
Retail gross margin rate was up 0.1% for the half despite the re-introduction of a mid-season sale. Hire margin rates were 3.5% lower resulting from the fixed depreciation charges within the reduced volume of Hire orders placed. Overall gross margin rate was 0.7% lower at 61.2% (HY1 2016: 61.9%).
The refit programme to modernise the Moss Bros store portfolio nears completion and our refitted stores continue to achieve their payback targets. 4 stores were refitted in the 26 weeks to 29 July 2017 (HY1 2016: 7) and a further 4 stores are scheduled to be refitted in the second half of the financial year. 103 new and refitted stores now trade in the new format and this is continuing to change customers' perception of the business to a modern, multichannel retailer that is also the leading brand in Hire.
In line with our strategy of improving the store portfolio we opened 4 new stores; At Dundrum in Ireland, Metrocentre in Gateshead, at the new Rushden Lakes development near Northampton and a concession store in Bexleyheath. We also relocated our Bicester and Cardiff stores during the first half, and closed 2 non-core stores. Moss Bros currently trades from 129 stores. We will continue to improve the store portfolio where locations are found that meet our investment criteria.
Like for like* hire sales were 8.4% below 2016 levels and as mentioned above, will only recover fully to a 'normalised' level at the end of the 2017 wedding season in September. The newly introduced Lounge Suits have again proved very popular with customers. The second half of the year sees less impact from wedding hire bookings as we move into the more traditional eveningwear season where again, new product will feature strongly within our Hire offer. Whilst still small in terms of sales volume, we continue to develop our online hire proposition. Our new Hire website launched during the half which features new functionality to enable the creation of 'My Outfit' - an online outfit 'scratch pad' which can later be recalled and updated in-store when customers are further along the Hire journey.
Our online capability continues to grow, with e-commerce retail sales up 14.5% on the previous year. Site visitor numbers continue to improve, especially mobile device traffic which now contributes 47%, of online sales. Overall online sales now comprise 11.2% of total Group revenue (HY1 2016: 10.3%).
Our two store pilot in the Middle East has shown reasonable growth on the year but remains firmly a trial as we seek to refine our approach whilst continuing to enable the potential for further expansion to be evaluated at relatively low risk and cost to the business.
Costs remain tightly controlled with expenditure focussed on areas which support our longer term goals. We will continue to challenge all areas of cost in order to ensure that our cost base remains commensurate to the growth in both sales and gross profit which we deliver.
Our product supply relationships, prices and routes are continually reviewed and we have undertaken a further consolidation of our supply base for Spring/Summer 2018 product. Foreign currency exposure, principally US Dollar, relates to approximately 35% of our product buy for Autumn/Winter 2017 and will increase for the following season to approximately 55%. Our USD requirement is already fully hedged for both of these proceeding seasons.
The development of our people remains key to delivering our ambition of becoming the first choice for men's tailoring. Investment in our people through recruitment, induction, training and development, performance appraisal and performance management is vital to delivering our strategic goals.
*Like-for-like (including VAT) represents financial information for e-commerce and stores open during both the current and prior financial periods and compares 26 weeks against 26 weeks, except for stores refitted in the period, where the period closed for refit is excluded from both the current and prior financial periods. Like-for-like Hire and Tailor Me sales are calculated on cash receipts in the period, before adjustment for the movement in the level of deposits held
FINANCIAL SUMMARY
A summary of the key financial results is set out in the table below.
Hot Features
Premium
Key financials
CONTINUING OPERATIONS 26 weeks 26 weeks 52 weeks
to to to 28
29 July 30 July January
2017 2016 2017
GBP'000 GBP'000 GBP'000
Revenue
Retail 58,110 54,558 110,812
Hire 8,508 9,287 17,118
---------------------------------- --------- --------- -----------
Total revenue 66,618 63,845 127,930
---------------------------------- --------- --------- -----------
Gross profit
Retail 34,436 32,293 64,920
Hire 6,335 7,240 13,482
---------------------------------- --------- --------- -----------
Total gross profit 40,771 39,533 78,402
---------------------------------- --------- --------- -----------
Gross margin %
Retail 59.3% 59.2% 58.6%
Hire 74.5% 78.0% 78.8%
---------------------------------- --------- --------- -----------
Total 61.2% 61.9% 61.3%
---------------------------------- --------- --------- -----------
Administrative expenses
(*) (2,876) (3,535) (6,620)
Shops' selling and marketing - - -
costs (*)
Shops' selling and marketing - - -
costs classified as exceptional
Shops' selling and marketing
costs total (33,681) (32,385) (64,705)
---------------------------------- --------- --------- -----------
Operating profit 4,214 3,613 7,078
---------------------------------- --------- --------- -----------
Other gains and losses - - -
Other gains and losses - - -
classified as exceptional
Other gains and losses
total - 5 26
Investment revenues 12 33 43
Financial costs - - -
Profit before tax 4,226 3,651 7,146
---------------------------------- --------- --------- -----------
EBITDA (**) 7,372 6,754 13,607
---------------------------------- --------- --------- -----------
* Administrative expenses and shops' selling and marketing costs are not analysed between Retail and Hire.
** EBITDA is earnings before interest, tax, depreciation and amortisation on continuing activities. See Note 6.
DIVID AND DIVID POLICY
The Board has decided to declare an interim dividend of 2.03 pence per share (HY1 2016: 1.91 pence per share) to be paid on 24 November 2017, to shareholders on the register on 27 October 2017 (ex dividend date 26 October 2017).
FINANCIAL POSITION
Net assets reduced to GBP35.6m (30 July 2016: GBP37.3m).
The close management of cash remains a focus. The underlying cash position at 29 July 2017 was GBP21.5m (30 July 2016: GBP21.1m). Net cash inflow for the six months ended 29 July 2017 was GBP2.0m. Dividends of GBP4.0m were paid in the period. The Group continues to meet its day to day working capital requirements through surplus cash balances.
Total net inventory as at 29 July 2017 was GBP15.2m (30 July 2016: GBP14.6m). This increase was in line with the increase in revenue.
RELATED PARTY TRANSACTIONS
The Group had no material related party transactions other than on an arm's length basis, which might reasonably be expected to influence decisions made by other users of the condensed set of financial statements. Details of all related party transactions are disclosed in the notes to this Interim Management Report.
RISKS AND UNCERTAINTIES
Details of all potential risks and uncertainties are disclosed in the note 2 of this Interim Management Report.
CAUTIONARY STATEMENT
This Interim Management Report ("IMR") has been prepared solely to provide additional information to shareholders to assess the Group's strategies and the potential for those strategies to succeed. This IMR should not be relied on by any other party or for any other purpose.
This IMR contains certain forward-looking statements. These statements are made by the Directors in good faith based on the information available to them up to the time of their approval of this IMR but such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.
This IMR has been prepared for the Group as a whole and therefore gives greater emphasis to those matters which are significant to Moss Bros Group PLC and its subsidiary undertakings when viewed as a whole.
DIRECTORS' RESPONSIBILITY STATEMENT
We confirm to the best of our knowledge:
a: the condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting';
b: the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
c: the interim management report includes a fair review of the information required by the DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
The directors are responsible for maintenance and integrity of the corporate and financial information included on the Company's website. Legislation in the United Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in other jurisdictions.
Moss Bros Group PLC
8 St. John's Hill
London
SW11 1SA
By Order of the Board,
Brian Brick Tony Bennett
Chief Executive Officer Finance Director and Company Secretary
MOSS BROS GROUP PLC
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE 26 WEEKS TO 29 JULY 2017
26 weeks to 26 weeks to 52 weeks
29 July 2017 30 July 2016 to
28 January
2017
Total Total Total
GBP'000 GBP'000 GBP'000
(Unaudited) (Unaudited) (Audited)
------------------------ -------------- -------------- ------------
CONTINUING OPERATIONS
Revenue 66,618 63,845 127,930
Cost of sales (25,847) (24,312) (49,528)
-------------------------- -------------- -------------- ------------
Gross profit 40,771 39,533 78,402
Administrative
expenses (2,876) (3,535) (6,620)
Shops' selling
and marketing costs (33,681) (32,385) (64,705)
-------------------------- -------------- -------------- ------------
Operating profit 4,214 3,613 7,077
Other gains and
losses - 5 26
Investment revenues 12 33 48
Financial costs - (5)
-------------------------- -------------- -------------- ------------
Profit on ordinary
activities before
taxation 4,226 3,651 7,146
Taxation charge (961) (646) (1,623)
-------------------------- -------------- -------------- ------------
Profit from continuing
operations after
taxation 3,265 3,005 5,523
Profit after taxation
attributable to
equity holders
of the parent 3,265 3,005 5,523
========================== ============== ============== ============
Other comprehensive
income
Cash flow hedges
Change in fair
value of effective
portion (847) 289 (212)
------------
Total comprehensive
income 2,418 3,294 5,311
========================== ============== ============== ============
Earnings per share
Basic - continuing 3.25p 3.01p 5.51p
Diluted - continuing 3.24p 2.93p 5.39p
-------------------------- -------------- -------------- ------------
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE 26 WEEKS TO 29 JULY 2017
26 Weeks ended Share
29 July 2017 premium Retained Total
(Unaudited) Share Employee
Share based benefit Hedging
capital account payments trust reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Balance at 28
January 2017 5,040 8,673 637 (138) 418 22,869 37,499
Profit for the
period - - - - - 3,265 3,265
Other comprehensive
income:
Cash flow hedging
movement - - - - (847) - (847)
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Total comprehensive
income - - - - (847) 3,265 2,418
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Dividends paid - - - - - (4,000) (4,000)
Issue of share - - - - - - -
capital
Credit to equity
for equity settled
share based
payments - - 65 - - - 65
Exercise of
shares held
under option - - (382) - - 382 -
Movement on
deferred tax
on share based
payments - - 57 - - - 57
Movement on
current tax
on exercise
of equity settled
share-based
payments - - - - - 8 8
Sale of shares
by employee
benefit trust - - - 286 - (286) -
Purchase of
shares by employee
benefit trust - - - (467) - (467)
SAYE exercise - - - - - - -
- employee contributors
Balance at 29
July 2017 5,040 8,673 377 (319) (429) 22,238 35,580
========================== ========= ========== =========== ========== ========= =========== =========
26 Weeks ended Share
30 July 2016 premium Retained Total
(Unaudited) Share Employee
Share based benefit Hedging
capital account payments trust reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Balance at 30
January 2016 5,040 8,673 775 (682) 630 22,901 37,337
Profit for the
period 3,005 3,005
Other comprehensive
income:
Cash flow hedging
movement - - - - 289 - 289
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Total comprehensive
income 289 3,005 3,294
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Dividends paid - - - - - (3,766) (3,766)
Issue of share - - - - - - -
capital
Credit to equity
for equity settled
share based
payments - - 289 - - - 289
Exercise of
shares held
under option - - (459) - - 459 -
Movement on
deferred tax
on share based
payments - - (20) - - - (20)
Movement on
current tax
on exercise
of equity settled
share-based
payments - - - - - 110 110
Sale of shares
by employee
benefit trust - - - 507 - (507) -
SAYE exercise
- employee contributors 70 70
Balance at 30
July 2016 5,040 8,673 585 (175) 919 22,272 37,314
========================== ========= ========== =========== ========== ========= =========== =========
52 Weeks ended Share
28 January 2017 premium Total
(Audited) Share Employee Retained
Share based benefit Hedging earnings
capital account payments trust reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Balance at 30
January 2016 5,040 8,673 775 (682) 630 22,901 37,337
Profit for the
period - - - - - 5,523 5,523
Other comprehensive
income:
Cash flow hedging
movement - - - - (212) - (212)
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Total comprehensive
income - - - - (212) 5,523 5,311
-------------------------- --------- ---------- ----------- ---------- --------- ----------- ---------
Dividends paid - - - - - (5,687) (5,687)
Credit to equity
for equity settled
share-based
payments - - 392 - - - 392
Exercise of
shares held
under option - - (480) - - 480 -
Movement on
deferred tax
on equity settled
share-based
payments - - (50) - - - (50)
Movement on
current tax
on exercise
of equity settled
share-based
payments - - - - - 113 113
Sales of shares
by employee
benefit trust - - - 544 - (544) -
SAYE exercise
- employee contributors - - - - - 83 83
Balance at 28
January 2017 5,040 8,673 637 (138) 418 22,869 37,499
========================== ========= ========== =========== ========== ========= =========== =========
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 29 JULY 2017
29 July 2017 30 July 2016 28 January
GBP'000 GBP'000 2017
GBP'000
(Unaudited) (Unaudited) (Audited)
------------------------------- ------------- ------------- -----------
Assets
Intangible assets 1,834 1,546 1,443
Property, plant and
equipment 19,464 18,807 18,792
Leasehold improvements 1,267 1,189 1,252
Deferred tax assets 1,266 1,359 1,200
------------------------------- ------------- ------------- -----------
Total non-current assets 23,831 22,901 22,687
Inventories 15,241 14,601 16,709
Trade and other receivables 4,405 3,241 3,688
Cash and cash equivalents 21,472 21,128 19,518
Derivative financial
instruments - 891 411
------------------------------- ------------- ------------- -----------
Total current assets 41,118 39,861 40,326
------------------------------- ------------- ------------- -----------
Total assets 64,949 62,762 63,013
=============================== ============= ============= ===========
Liabilities
Trade and other payables 20,556 17,348 17,157
Provisions 1,001 1,086 1,252
Current tax liability 1,252 858 1,181
Derivative financial 443 - -
instruments
------------------------------- ------------- ------------- -----------
Total current liabilities 23,252 19,292 19,590
------------------------------- ------------- ------------- -----------
Other payables 3,588 3,190 3,208
Provisions 1,334 1,418 1,321
Deferred tax liabilities 1,195 1,548 1,395
Total non-current liabilities 6,117 6,156 5,924
------------------------------- ------------- ------------- -----------
Total liabilities 29,369 25,448 25,514
=============================== ============= ============= ===========
Net assets 35,580 37,314 37,499
Equity
Issued capital 5,040 5,040 5,040
Share premium account 8,673 8,673 8,673
Share based payments 377 585 637
Employee benefit trust (319) (175) (138)
Hedging reserve (429) 919 418
Retained earnings 22,238 22,272 22,869
------------------------------- ------------- ------------- -----------
Equity attributable
to equity holders of
parent 35,580 37,314 37,499
------------------------------- ------------- ------------- -----------
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE 26 WEEKS TO 29 JULY 2017
26 weeks 26 weeks 52 weeks
to to to
29 July 30 July 28 January
2017 2016 2017
GBP'000 GBP'000 GBP'000
(Unaudited) (Unaudited) (Audited)
-------------------------------- ------------ ------------ ------------
Operating activities
Profit after taxation 3,265 3,005 5,523
Adjustments for:
Taxation charge 961 646 1,623
Other gains and losses 8 (5) (26)
Investment revenues (12) (33) (48)
Net finance costs - - 5
Amortisation of intangible
assets 403 413 801
Depreciation of property,
plant and equipment 2,849 2,830 5,905
Amortisation of compulsory
purchase compensation (102) (102) (203)
Loss on disposal of property,
plant and equipment 176 303 636
(Increase)/Decrease in
inventories 1,468 (173) (2,281)
Decrease / (increase) in
receivables (717) (228) (675)
Increase / (decrease) in
payables 3,867 5,918 5,718
Increase/(Decrease) in
provisions (238) 26 96
Share-based payments expense 74 317 444
Exercise of share options (382) (459) (480)
Exceptional income - lease - - -
compensation cash receipt
Taxation received / (paid) (1,089) (397) (1,072)
-------------------------------- ------------ ------------ ------------
Net cash from operating
activities 10,531 12,061 15,966
================================ ============ ============ ============
Investing activities
Interest received 12 33 48
Interest paid - - (5)
Purchase of intangible
assets (794) (365) (650)
Purchase of property, plant
and equipment (3,614) (4,768) (8,115)
Proceeds from the disposal
of property, plant and
equipment - 145 138
Net cash used in investing
activities (4,396) (4,955) (8,584)
================================ ============ ============ ============
Financing activities
Dividends paid (4,000) (3,766) (5,687)
Proceeds from the issue - - -
of shares
Sale of shares by employee
benefit trust 286 507 544
Purchase of shares by employee (467) - -
benefit trust
-------------------------------- ------------ ------------ ------------
Excess SAYE receipt between
cost and exercise price - 22 20
-------------------------------- ------------ ------------ ------------
Net cash used in financing
activities (4,181) (3,237) (5,123)
================================ ============ ============ ============
Net (decrease)/increase
in cash and cash equivalents 1,954 3,869 2,259
Cash and cash equivalents
at beginning of period 19,518 17,259 17,259
Cash and cash equivalents
at end of period 21,472 21,128 19,518
================================ ============ ============ ============
NOTES TO THE CONDENSED SET OF CONSOLIDATED FINANCIAL STATEMENTS
FOR THE 26 WEEKS TO 29 JULY 2017
1. GENERAL INFORMATION
The results for the 26 weeks ended 29 July 2017 and 30 July 2016 are neither audited nor reviewed by the Group's auditor.
The information for the 52 weeks ended 28 January 2017 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and did not contain statements under section 498(2) or (3) of the Companies Act 2006.
2. ACCOUNTING POLICIES
BASIS OF PREPARATION
The annual financial statements of Moss Bros Group PLC are prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union.
The condensed set of consolidated financial statements included in this half-yearly report has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting", as adopted by the European Union.
GOING CONCERN
The Directors are satisfied that the Group and Company have sufficient resources to continue in operation for the foreseeable future, being a period of at least 12 months from the date of approval of this half-yearly report. Accordingly, they continue to adopt the going concern basis in preparing the half-yearly report and financial statements.
The Directors believe the Group is well placed to manage its business risks successfully. The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group should be able to operate within the level of its current and anticipated cash resources.
CHANGES IN ACCOUNTING POLICY
The same accounting policies, presentation and methods of computation are followed in this half-yearly report as applied in the Group's latest annual audited financial statements for the 52 weeks ended 28 January 2017.
RISKS AND UNCERTAINTIES
There are a number of potential risks and uncertainties which could have a material impact on the Group's performance over the remaining six months of the financial year and could cause actual results to differ materially from expected and historical results. The Directors have revisited and updated the principal risks and uncertainties as published in the annual report for the 52 weeks ended 28 January 2017, which are summarised below:
BUSINESS RISK TO COMPANY MITIGATION OF RISK ASSESSMENT
AREA OF CHANGE IN
RISK YEAR ON
YEAR
=============================== ============================ ============================ =========================
Hire The Hire business We have a dedicated The risk is
demands the highest customer service ongoing; we
level of customer team which actively have undertaken
service seek to resolve a further review
This is delivered any customer service of our Hire
through a highly issues arising. operations
developed and We are continually during 2017
efficient infrastructure refreshing and replenishing and implemented
which enables our stock of hire a number of
consistent 'delivery garments to ensure procedural
to promise'. we are able to cater changes to
Any disruption for all occasions ensure that
to this infrastructure whenever they fall we operate
would affect due. in the most
our ability to We have previously effective manner
maintain customer strengthened our possible to
service levels. market position deliver on
through the introduction customer promise
of a new transactional
Hire website and
back-end system
improvements are
in development.
=============================== ============================ ============================ =========================
Retail Factors outside We continually focus This risk has
and Tailor our control, on maintaining our increased as
Me such as an economic product quality, the economic
downturn affecting customer service outlook has
the UK or any and supplier relationships, toughened since
wider economic whilst retaining the Brexit
downturn as a our competitive vote in the
result of the position, including UK.
vote to leave value and pricing. The longer
the EU, may have term risks
a material adverse Foreign currency associated
effect on results exposure, principally with the EU
As a retail business the US Dollar, is referendum
based and operating hedged for 6 to are difficult
predominantly 9 months in advance to quantify
in the UK, we and so any short until we have
are particularly terms currency fluctuations further clarity
exposed to any during the EU referendum on approach
economic downturn campaign period from both UK
in the UK which have been mitigated. government
could affect and EU negotiators.
consumer confidence
and therefore
spending.
=============================== ============================ ============================ =========================
BUSINESS RISK TO COMPANY MITIGATION OF RISK ASSESSMENT
AREA OF CHANGE IN
RISK YEAR ON
YEAR
=============================== ============================ ============================ =========================
E-Commerce Customer satisfaction We are continually With the continuous
is as important developing our website increase in
online as offline offering in order trade through
Ease of navigation/ability to become fully e-commerce
to transact quickly multi-channel. and the market
on the website Our Retail website trend on moving
is key to generating has continued to to a fully
sales online. see increases in multi-channel
Maintaining a conversion rates operation,
competitive edge and average order the risk has
through customers values. increased during
being able to We have developed the year.
interact with a fully responsive
the product online, website during the
offering product first half which
choice and availability, provides a more
and allowing appropriate browsing
multiple payment experience for the
and delivery increasing proportion
options are important of visitors to the
in growing our site using mobile
online presence. or tablet technology.
Ensuring a secure We have security
online marketplace policies, rules
is also vital and technical measures
for customers in place to protect
to be able to customer data.
transact safely. We continue to focus
our efforts on developing
our 'mobile first"
capability
=============================== ============================ ============================ =========================
Brand Maintaining our We continue with The risk has
image store presentation our store redevelopment been reduced
is important programme to both during the
for attracting modernise the look year with the
customers and and feel of the progression
growing our brand stores and to meet of the store
The historical more routine maintenance redevelopment
underinvestment that has been deferred programme.
in the store for many years.
estate in previous The development
years has meant and launch of a
that some of new sub brand line
our stores lack up, under the master
the level of brand 'Moss Bros',
presentation in Autumn 2014 has
that we require strengthened the
to grow the business brand identity
and the brand.
=============================== ============================ ============================ =========================
Costs Supply chain Management has in The risk is
cost price increases part mitigated the ongoing, however,
and currency cost price risk and is continually
fluctuation could as a significant monitored and
have a materially proportion of inventory addressed via
adverse affect is direct sourced the actions
on results and prices have noted here
A fluctuation been agreed as a
in currency rates result of competitive
could materially tendering.
affect the Group's In addition, the
cost base and Group operates a
margins. treasury policy
A re-emergence which hedges a significant
of general price proportion of the
inflation could foreign exchange
affect profitability risk from such direct
Although the sourcing arrangements.
outlook for price Management closely
inflation appears monitor the effectiveness
relatively benign, of these arrangements.
there are areas If general price
of concern such inflation returns
as the impact this may allow an
of the 2017 business increase retail
rates revaluation selling prices albeit
and the second subject to market
stage increase conditions
following the Ongoing review of
introduction store profitability,
of the National combined with shorter
Living Wage lease durations.
Remuneration policies
are under review
to ensure we remain
competitive in the
marketplace.
=============================== ============================ ============================ =========================
Supply A disruption We are continually The risk is
chain to supplier continuity reviewing and refreshing ongoing, however,
may adversely our supplier list. and is continually
affect our operation The diversification monitored and
Suppliers going of product buying addressed.
out of business across a range of
could have a suppliers limits
significant impact the Group's over
on our ability reliance upon any
to meet demand individual supplier.
in store and
online.
=============================== ============================ ============================ =========================
Distribution Operating our We continually review With new and
centre distribution and monitor our increased operating
(DC) centre from one disaster recovery pressures on
location leaves plan to ensure that the DC through
the Group exposed all business risks multi-channel,
to business catastrophes are adequately covered. the reliance
occurring at Our financial risk and consequent
that location of operating from exposure to
Any business one location is risk of the
catastrophe affecting mitigated through DC failing
our distribution our comprehensive has again increased
centre could insurance cover. during the
severely affect DC IT systems were year.
the Group's ability upgraded in 2014.
to supply to
stores and customers.
=============================== ============================ ============================ =========================
BUSINESS RISK TO COMPANY MITIGATION OF RISK ASSESSMENT
AREA OF CHANGE IN
RISK YEAR ON
YEAR
=============================== ============================ ============================ =========================
Cyber A cyber crime Customer bank or Frequency and
crime attack could payment card details severity of
disable the Group's are not processed cyber crime
key IT systems or stored in the attacks against
and compromise Group's IT systems. companies have
data security Comprehensive security increased significantly
measures are in
place with regular
tests carried out.
Development in cyber
crime and preventative
strategies are constantly
reviewed.
=============================== ============================ ============================ =========================
People The Group's reliance Effective recruitment The risk is
on key management policies and people on-going however
and other personnel development means is continually
could put pressure the Group can take monitored and
on the business full advantage of addressed.
if they were the recovery in
to leave its performance.
Attracting and Long term incentive
retaining high share awards were
calibre people granted to senior
is a key priority employees during
and a central the year to more
focus in striving closely align their
for excellent interests to those
customer service of the Group and
across the Group's a SAYE scheme is
business channels. in operation.
=============================== ============================ ============================ =========================
3. BUSINESS SEGMENTS
The majority of the Company's turnover arose in the United Kingdom, with the exception of two stores in Ireland.
IFRS 8 'Operating Segments' requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the Chief Executive to allocate resources to the segments and to assess their performance.
Information reported to the Group's Chief Executive Officer for the purposes of resource allocation and assessment of segment performance is focused on the split of Retail and Hire.
Information regarding the Group's continuing operating segments is reported within the Financial Summary on page 5.
Only revenue and gross profit have been reported for the Group's business segments; Retail and Hire, as the main operating costs, being property, related overheads and staff, cannot be separately identifiable as they both use the same stores and hence operating profit is not reported to the Chief Executive Officer by Retail and Hire. Revenue and gross profit are the measures reported to the Chief Executive Officer for the purpose of resource allocation and assessment of segmental performance.
On the same basis, assets cannot be allocated between Retail and Hire, and are not reported to the Chief Executive Officer seperately.
4. TAX
The effective tax rate on the reported profit before tax for the 26 week period to 29 July 2017 is 22.7% (30 July 2016: 17.7%; 28 January 2017: 22.7%), representing the expected average annual effective tax rate for the full year, applied to the pre-tax income of the 26 week period.
5. EARNINGS PER SHARE
Basic earnings per ordinary share is based on the weighted average of 100,417,250 (30 July 2016: 99,992,821; 28 January 2017: 100,211,983) ordinary shares in issue during the period after deducting for shares held by the Employee Benefit Trust and are calculated by reference to the profit attributable to shareholders of GBP3,265,000 (30 July 2016: GBP3,005,000; 28 January 2017: GBP5,523,000).
Diluted earnings per ordinary share is based upon the weighted average of 100,812,389 (30 July 2016: 102,519,282; 28 January 2017: 102,559,814) ordinary shares, after deducting shares held by the employee Benefit Trust, that were non-dilutive for the period presented and could dilute earnings per share in the future and are calculated by reference to the profit attributable to shareholders as stated above.
Basic earnings per share 26 weeks 26 weeks 52 weeks
to to to
29 July 30 July 28 January
2017 2016 2017
Pence Pence pence
------------------------------- --------- --------- ------------
Total (continuing operations) 3.25 3.01 5.51
Continuing operations basic
earnings per share 3.25 3.01 5.51
------------------------------- --------- --------- ------------
Diluted earnings per share 26 weeks 26 weeks 52 weeks
to to to
29 July 30 July 28 January
2017 2016 2017
Pence Pence pence
------------------------------- --------- --------- ------------
Total (continuing operations) 3.24 2.93 5.39
Continuing operations diluted
earnings per share 3.24 2.93 5.39
------------------------------- --------- --------- ------------
6. EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION ("EBITDA")
EBITDA as reported in the Financial Summary on page 5 is calculated as follows:
Continuing activities 26 weeks 26 weeks 52 weeks
to to to
29 July 30 July 28 January
2017 2016 2017
---------------------------- --------- --------- ------------
Profit before tax 4,226 3,651 7,146
============================ ========= ========= ============
Deduct:
============================ ========= ========= ============
Investment revenues (12) (33) (48)
============================ ========= ========= ============
Financial costs - - 5
============================ ========= ========= ============
Add:
============================ ========= ========= ============
Depreciation of property,
plant and equipment 2,849 2,830 5,905
============================ ========= ========= ============
Amortisation of intangible
assets 403 413 801
============================ ========= ========= ============
Amortisation of compulsory
purchase compensation (102) (102) (203)
============================ ========= ========= ============
Other gains and losses 8 (5) -
============================ ========= ========= ============
EBITDA 7,372 6,754 13,606
---------------------------- --------- --------- ------------
7. DIVIDS
The directors have declared an interim dividend of 2.03 pence per share (HY1 2016: 1.91 pence per share) payable on 24 November 2017 to shareholders on the register on 27 October 2017 with an ex dividend date of 26 October 2017.
8. RELATED PARTY TRANSACTIONS
The Group had no material related party transactions other than on an arm's length basis, which might reasonably be expected to influence decisions made by other users of the condensed set of financial statements.
TRADING TRANSACTIONS
Moss Bros agreed a sublet of a store lease to White Stuff Ltd ("White Stuff"). Debbie Hewitt, Chairman of Moss Bros Group plc, is also Chairman and Director of White Stuff. The transaction was on arms length commercial terms and Debbie Hewitt took no part in determining the commercial terms offered by Moss Bros or in the decision to accept them taken by White Stuff. The sublet is from June 2014 until December 2021 at a rent of GBP50,000 per year. A capital contribution of GBP50,000 was paid to White Stuff on completion of the agreement.
At 29 July 2017, the balance due from White Stuff was GBPnil in respect of service charges payable in arrears.
Berkeley Burke Trustee Company Limited is considered a related party of the Group because Brian Brick, Chief Executive Officer of Moss Bros Group plc is a beneficiary of the pension fund. On 8 December 2011, Moss Bros Group plc agreed a long term lease with Berkeley Burke Trustee Company Limited, a pension fund and the superior landlord, for a store in Hounslow, on an arm's length basis.
AAK Limited is considered a related party of the Group because Maurice Helfgott, Senior Independent Non- Executive Director of Moss Bros Group plc, has a close relative holding a key management position with significant influence and who is a significant shareholder at AAK Limited. All transactions with AAK Limited have been on an arm's length basis. During the period to 29 July 2017, total purchases from AAK Limited were GBP1.2m, including VAT, (28 January 2017: GBP4.3m, including VAT), of which GBPnil was outstanding at 29 July 2017.
9. SHARE BASED PAYMENTS
In 2009/10 a new equity settled Long Term Incentive Plan (LTIP) was approved by shareholders. During the period to 29 July 2017, under the same 2009/10 LTIP scheme, 1,075,466 shares were awarded to senior employees on 20 April 2017. In accordance with this plan, the shares are exercisable at nil cost, subject to the satisfaction of performance conditions and the requirement for the continued employment during the vesting period. The fair value is measured at grant date using the Black Scholes pricing model and recognised over the vesting period. These grants are accounted for in accordance with IFRS 2 'Share-based Payments'.
A Save As You Earn (SAYE) scheme was approved and adopted in 2012/13 and is open to all employees to benefit from the continued growth of the business. During the period to 29 July 2017, a further grant was made.
The amount recorded in the income statement for share based payments under IFRS2 in the period to 29 July 2017 was GBP32,667 (30 July 2016: GBP296,000; 28 January 2017: GBP409,000).
A deferred tax adjustment was recorded in the share-based payment reserve of GBP57,000 credit in the period to 29 July 2017 (30 July 2016: debit of GBP20,000, 28 January 2017: debit of GBP50,000).
10. HALF-YEARLY REPORT
This half-yearly report is available on application from the Company Secretary, Moss Bros Group PLC,
8 St. John's Hill, London SW11 1SA (and on the Company's website www.mossbros.co.uk).
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR UBRNRBRAKUAR
(END) Dow Jones Newswires
September 28, 2017 02:00 ET (06:00 GMT)
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