TIDMAXN
RNS Number : 5964F
Alexon Group PLC
28 April 2011
ALEXON GROUP PLC
("Alexon" or "the Company" or the "Group")
Unaudited preliminary results for the 52 weeks ended 29 January
2011
Alexon Group plc announces its preliminary results for the 52
weeks ended 29 January 2011 demonstrating further progress with its
turnaround, a return to profitability and encouraging current
trading, which is broadly line with management expectations.
Financial highlights
-- Turnover was GBP135.9m (2010: GBP153.4m), with like-for-like
sales down 3.4%
-- Gross margin up by 10 basis points
-- Pre-tax profit from continuing operations, before exceptional
items, of GBP0.8m (2010: loss of GBP0.9m), in line with our
expectations at the time of the Group's trading update on 27
January 2011
-- Pre-tax profit from continuing operations, after exceptional
items, of GBP0.1m (2010: loss of GBP14.3m)
-- Full year results significantly impacted by the adverse
weather in December which we estimate reduced the Group's revenue
and profits by approximately GBP5m and GBP1.6m respectively
-- Year end net debt of GBP8.7m (2010: net debt of GBP9.0m)
-- No dividend proposed for the year (2010: nil)
Strategic and operational highlights
-- Challenging trading conditions but continued progress with
turnaround strategy and strengthening of management team and
operational infrastructure
-- Refinancing and Capital Raising completed in March 2010
-- Continued progress on key priorities identified at the time
of the Capital Raising
-- Planned property portfolio reorganisation complete - exited
51 onerous loss-making leases resulting in annualised cash cost
savings of GBP6.6m
-- Further progress made in brand marketing, design and
incremental product areas
-- Online sales expanding rapidly - up 144% year on year
-- 51 concession and store refits completed
-- 115 new concessions opened in the year
-- Logistics consolidation and implementation of new warehouse
management system
-- Increase in existing bank facilities agreed with Barclays
following the cash impact of Q4 trading losses
-- The Group considers that a more appropriate capital structure
would enable it to secure and accelerate the turnaround plan and is
exploring its options accordingly
Current trading and outlook
-- Trading has been encouraging and broadly in line with
management expectations for the twelve weeks ended 23rd April 2011,
with Group like-for-like sales up 2.9%, and the gross margin
slightly down reflecting increased promotional activity
-- Although the higher costs of the increased bank facility are
expected to impact the result for the current year and the outlook
for the retail market remains challenging, the actions taken by the
Group and the underlying operational performance of the business
(as evidenced by LFL sales growth) provide a positive platform for
improved financial performance going forward
Board changes
-- Today Alexon has announced that Richard Handover will step
down as Chairman on 31(st) May 2011 and that David Adams, currently
a Non-Executive Director, will assume the role of Chairman from
31(st) May 2011. (see separate release)
Commenting on the preliminary results, Jane McNally, Chief
Executive, said:
"Despite being another difficult year for the UK retail industry
we are pleased that the Group made further progress with its
turnaround and has returned to profitability. That said our
performance was impacted not only by the challenging trading
environment but also by the severe weather in the last quarter
which adversely affected profits and our cash position.
We are pleased to report that trading since the year end has
been encouraging and broadly in line with management expectations
against a tough economic backdrop. We are also pleased that our new
Spring/Summer collections have been well received by our host store
partners. With the exception of Minuet and Dash, all brands are
performing in line with or exceeding expectations. Group like for
like sales for the twelve weeks ended 23rd April 2011 were up 2.9%.
Overall margin is slightly down reflecting increased promotional
activity.
In terms of strategic objectives, there is a real opportunity to
further increase profitability. This will be achieved through
improving the mix in routes to market including further online
expansion; rolling out enhanced brand environments through our
re-fit programme; investing in improved store communications and
merchandising systems to drive further improvement in net margin
and stockturn; and pursuing a gradual strategic standalone opening
programme for selected brands."
Enquiries:
Alexon Group plc 01582 723131
Jane McNally, Chief Executive Officer
John Boyle, Group Finance Director and Company Secretary
Brunswick Group LLP 020 7404 5959
Simon Sporborg / Zoe Bird
Overview
2010 was a challenging year for Alexon, with difficult economic
conditions and severe weather impacting our most important trading
period. However, management continued to drive the turnaround plan
forward, and as a result we are now seeing sustained improvement in
the underlying performance of the Group's brands.
Group sales from continuing operations for the 52 weeks ended 29
January 2011 were down 3.4% on a like-for-like basis and gross
margins were up 10 basis points on the prior year. Pre-tax profit
from continuing operations before exceptional items, was GBP0.8
million (2010: loss of GBP0.9m). We estimate that the weather
impacted our revenues and profits by approximately GBP5m and
GBP1.6m respectively. Pre-tax profit from continuing operations,
after exceptional items of GBP0.7 million, was GBP0.1 million
(2010: loss of GBP14.3 million).
The exceptional items in relation to continuing operations
consist of the impairment of fixed assets associated with leasehold
stores which are expected to generate net cash outflows over their
remaining lease terms (GBP0.2m), costs and the impairment of fixed
assets associated with the reorganisation and centralisation of the
Group's distribution centre (GBP0.4m), and costs relating to the
restructuring of the Group's finances (GBP0.1m). Total net charge
before tax from exceptional items for the year, including those
relating to discontinued operations, was GBP0.8 million (2010:
GBP5.0 million).
Earnings per share from continuing operations and before
exceptional items was 0.43p (2010: loss per share of 1.85p). The
earnings per share from total operations was 0.57p (2010: loss per
share of 12.98p). No dividends are proposed (2010: nil).
Update on strategy
The Group made strong progress with its turnaround during the
year as we continued to execute the strategy as set out in March
2010 which focused on restructuring our store portfolio; rolling
out the new store brand environments; continuing to develop new
brands; commencing the much needed systems overhaul and continuing
to develop accessories and footwear ranges.
Property Portfolio Reorganisation
The property portfolio reorganisation has continued throughout
the year with the Group exiting 37 of its onerous property leases
in March and April 2010. Since then a further seven leases have
been surrendered, five leases have expired, one has been sold for a
premium and one closed, as part of the warehouse closure in
Cardiff. The cost of these closures is GBP8.6m which has resulted
in GBP6.6m of annual cash losses being removed from the business.
In addition nine leases have been re-geared generating an annual
saving of GBP0.2m. We are in negotiation with landlords to re-gear
three more leases and action plans are being developed for a
further thirty stores.
Multi-channel
The multichannel strategy is progressing well with web sales
increasing 144% in 2010. The appointment of Giles Delafeld as
E-Commerce Director will help strengthen this position. We have
also entered into the catalogue market via wholesale partners and
our own joint venture trial which launched in March 2011,
incorporating product from Eastex, Dash and Alexon. Initial
feedback has been positive and we are anticipating this to be a
successful channel for reaching a more mature catchment. We have
upwardly revised our three-year online and direct sales mix growth
targets subject to capital spending restrictions.
Logistics & Systems
As initially detailed in our Interim Results announcement, we
have streamlined the logistics function to improve efficiency.
During the year we have successfully consolidated three warehouses
into one and have implemented a new warehouse management system, on
time and on budget, which will facilitate the expansion of our
multichannel strategy. We have also completed the detailed scoping
of the store communications system and commenced the specification
for a replacement merchandising system.
The Group is currently in the process of selling its two
warehouses in Cardiff and Milton Keynes, a proportion of the
proceeds of which will be used to pay down debt.
New Business - Concessions
During the year we opened 115 new concessions across a wide
range of host stores and including a continued expansion in garden
centres for Dash, which mostly offset the space reduction announced
in Q1. New business generated GBP9.3m of turnover during 2010
(GBP14.5m full year equivalent). We also entered wholesale
partnerships with selected mail order and online partners. We have
provisionally agreed to open 55 further concessions during the
coming year and have identified further opportunities which we have
deferred subject to capital spending availability.
New Business - New store openings
As announced last year, we have adopted a rigorous and
disciplined approach to standalone store trading. We will pursue a
gradual standalone opening programme for selected brands.
Brand Development
Reworked brand environments were developed for Dash, Eastex and
Kaliko during 2010 and blueprints agreed for all store and
concession grades ensuring that all six brands now have a refreshed
identity in preparation for a roll out programme.
Balance Sheet and cash flow
Stock levels were 4.5% higher than at the same point last year,
as a result of the poor weather during late November and December,
and earlier deliveries of spring summer stock into the business.
The Autumn/Winter terminal stock ratio was slightly higher than the
prior year at the period end, management of which impacted Q1
margins. Total liabilities were significantly reduced from the
prior year end due to the utilisation of GBP13.7m of the onerous
lease provision.
Net debt as at 29 January 2011 was GBP8.7m (2010: net debt of
GBP9.0m). The cash inflow from the refinancing of GBP18.2m was
utilized in making payments to exit onerous leases of GBP8.6,
capital expenditure of GBP2.5m and working capital increase of
GBP7.1m.
In line with the current economic climate, capital expenditure,
working capital and operating costs continue to be rigorously
monitored and controlled.
Dividend
The Board has decided not to propose a final dividend in respect
of the financial year ended 29 January 2011.
Refinancing
The Group has renegotiated its banking facilities and covenants
with Barclays. The new facilities incorporate an additional GBP2.5m
one year loan facility expiring 28(th) April 2012 and a deferral of
the scheduled repayment of GBP1.5m due in July 2011 to the same
date. In addition the Group is currently in the process of selling
its properties in Cardiff and Milton Keynes and a proportion of the
proceeds will be used to pay down debt. The remaining facilities
remain unchanged.
As part of the increased bank facilities, the Group has granted
Barclays warrants to subscribe for 6,156,902 new ordinary shares
(representing approximately four per cent. of Alexon's issued share
capital on a fully diluted basis) at a strike price of 12.5 pence
per share (the nominal value). The warrants have a life of six
years.
There is no change to the interest margin payable on the
facilities, and the increased cost of the new facility including an
arrangement fee and monitoring fees will amount to approximately
GBP0.5m in respect of the current financial year.
The combination of challenging market conditions and the GBP5m
reduction in revenues as a result of the December trading losses
has impacted the Group's ability to invest in the turnaround.
Whilst the Group has continued to make good progress implementing
the plan, the Board considers that a more appropriate capital
structure would enable it to secure and accelerate the turnaround
plan and is exploring its options accordingly.
Board and Management
The Group board welcomed Avril Palmer-Baunack and David Adams as
Non-Executive Directors in July 2010 and September 2010
respectively. Avril, who is currently Chief Executive Officer of
Autologic Holdings PLC, the AIM quoted automotive services company
has over 20 years of commercial experience, including tenure as
Chief Executive Officer at Universal Salvage plc where she led a
successful turnaround strategy. Avril has substantial experience in
developing online business capabilities. David, who is currently
Chairman of Jessops plc, has a wealth of experience in the retail
sector, having previously been Deputy CEO and Group Finance
Director at House of Fraser, Group Finance Director at Texas
Homecare and Divisional Finance Director at Burton Group.
The Executive board was further strengthened last year with the
addition of Kirstie Watson as Human Resources Director (replacing
our previous interim Director). Kirstie has previously held HR
Directorships at Warehouse, Rubicon Group and the British Fashion
Council. Giles Delafield joined in January 2011 as Group E-Commerce
Director from Blacks Leisure, and previously senior e-commerce
roles at Dixons Group and Lloyds Banking Group. At brand level the
team was strengthened in early 2010 with new controller
appointments on Alexon, Ann Harvey and Eastex.
Outlets
Summary of Number of Outlets as at 29th January 2011
Standalones Concessions Europe Total
Alexon 1 99 21 121
Eastex 1 258 27 286
Ann Harvey 41 46 28 115
Dash 12 202 22 236
Kaliko 11 109 28 148
Minuet 3 105 25 133
Clearance outlets ("stock
trading") 8 14 1 23
Web shop 6 14 0 20
83 847 152 1,082
============ ============ ======= ======
Current trading and outlook
We are pleased to report that trading since the year end has
been encouraging and broadly in line with management expectations
against a tough economic backdrop. We are also pleased that our new
Spring/Summer collections have been well received by our host store
partners. With the exception of Minuet and Dash, all brands are
performing in line with or exceeding expectations. Group like for
like sales for the twelve weeks ended 23rd April 2011 were up 2.9%.
Overall margin is slightly down reflecting increased promotional
activity.
In terms of strategic objectives, there is a real opportunity to
further increase profitability. This will be achieved through
improving the mix in routes to market including further online
expansion; rolling out enhanced brand environments through our
re-fit programme; investing in improved store communications and
merchandising systems to drive further improvement in net margin
and stockturn; and pursuing a gradual strategic standalone opening
programme for selected brands.
Looking ahead, whilst the higher costs of the increased bank
facility are expected to impact the result for the current year and
the outlook for the retail market remains challenging, the actions
taken by the Group and the underlying operational performance of
the business, as evidenced by recent LFL sales growth, provide a
positive platform for improved financial performance going
forward.
ALEXON GROUP PLC
Consolidated Income Statement
For the 52 weeks to 29 January 2011
2011 unaudited 2010
------------------------------------------ ---------------------------------------
Pre- Exceptional Pre- Exceptional
exceptional items exceptional items
(see note (see note
items 1) Total items 1) Total
Note GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------ ----- ------------ -------------- ---------- ------------ ------------ ----------
Revenue -
continuing
operations 135,924 - 135,924 153,382 - 153,382
Cost of sales (120,330) (164) (120,494) (139,333) (12,964) (152,297)
------------ -------------- ---------- ------------ ------------ ----------
Gross profit/(loss) -
continuing operations 15,594 (164) 15,430 14,049 (12,964) 1,085
Administrative
expenses (7,390) (210) (7,600) (7,311) (395) (7,706)
Distribution
costs (6,949) (299) (7,248) (7,102) - (7,102)
------------ -------------- ---------- ------------ ------------ ----------
Operating
profit/(loss) -
continuing
operations 1,255 (673) 582 (364) (13,359) (13,723)
Finance income 34 - 34 96 - 96
Finance expense (530) - (530) (624) - (624)
------------ -------------- ---------- ------------ ------------ ----------
Profit/(loss)
before taxation 759 (673) 86 (892) (13,359) (14,251)
Income tax
(expense)/credit 3 (185) 966 781 67 - 67
------------ -------------- ---------- ------------ ------------ ----------
Profit/(loss) for the financial
period from
continuing operations
attributable
to equity holders of
the company 574 293 867 (825) (13,359) (14,184)
(Loss)/profit
from
discontinued
operations 1b - (117) (117) - 8,382 8,382
Profit/(loss) for the financial
period attributable
to equity holders
of the company 574 176 750 (825) (4,977) (5,802)
------------ -------------- ---------- ------------ ------------ ----------
Earnings/(losses) per share from continuing
operations
attributable to equity holders of the
company during the period
Basic 4 0.66p (31.74)p
Diluted 4 0.65p (31.74)p
(Losses)/earnings per share from discontinued
operations
attributable to equity holders of the
company during the period
Basic and diluted 4 (0.09)p 18.76p
Earnings/(losses) per share from
total operations attributable
to equity holders of the company
during the period
Basic 4 0.57p (12.98)p
Diluted 4 0.56p (12.98)p
ALEXON GROUP PLC
Consolidated Statement of Comprehensive Income
For the 52 weeks to 29 January 2011
2011 2010
------- --------
GBP000 GBP000
Profit/(loss) for the financial period 750 (5,802)
Other comprehensive income/(expense):
Actuarial gain arising in defined benefit pension
scheme 887 117
Loss on cash flow hedges (673) (3,635)
Other comprehensive income/(expense) for the
period, net of tax 214 (3,518)
Total recognised income/(expense) for the financial
period
------- --------
attributable to equity holders of the Company 964 (9,320)
------- --------
Items in the statement above are disclosed net of tax. ALEXON
GROUP PLC
Consolidated Balance Sheet
As at 29 January 2011
2011(unaudited) 2010
GBP000 GBP000 GBP000 GBP000
--------- ---------------- --------- ---------
Non-current assets
Property, plant and
equipment 6,171 5,116
Deferred tax 2,230 2,343
8,401 7,459
Current assets
Inventory 28,964 27,705
Trade and other
receivables 10,843 10,917
Derivative financial
instruments - 452
Cash and cash equivalents 656 650
40,463 39,724
Current liabilities
Trade and other payables (21,065) (25,692)
Current tax payable (35) (885)
Derivative financial
instruments (461) -
Short term borrowings (4,875) (9,649)
(26,436) (36,226)
---------------- ---------
Net current assets 14,027 3,498
---------------- ---------
Non-current liabilities
Long term provisions (1,657) (12,038)
Accruals and deferred
income (90) (227)
Long term borrowings (4,500) -
Pension liabilities (1,773) (3,404)
Total non-current
liabilities (8,020) (15,669)
---------------- ---------
Net assets/(liabilities) 14,408 (4,712)
================ =========
Equity attributable to
equity holders
Share capital 18,389 5,689
Share premium 19,902 22,066
Capital redemption reserve 20,215 20,215
Cash flow hedge reserve (337) 336
Retained deficit (43,761) (53,018)
--------- ---------
Total equity attributable
to the Company's equity
shareholders 14,408 (4,712)
================ =========
ALEXON GROUP PLC
Consolidated Statement of Changes in Equity
For the 52 weeks to 29 January 2011
Cash
Capital flow
Share Share redemption hedge Merger Retained
capital premium reserve reserve reserve earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------- ----------- --------
At 31 January 2009 5,689 22,066 20,215 3,971 - (47,333) 4,608
Loss for the
period - - - - - (5,802) (5,802)
Other
comprehensive
income/(expense):
Actuarial gain
arising in
defined benefit
pension scheme,
net of tax - - - - - 117 117
Loss on cash flow
hedges, net of
tax - - - (3,635) - - (3,635)
At 30 January 2010 5,689 22,066 20,215 336 - (53,018) (4,712)
Profit for the
period - - - - 750 750
Issue of ordinary
shares, net of
transaction costs 12,700 (2,164) - - 7,620 - 18,156
Transfer of merger
reserve to
retained
earnings - - - - (7,620) 7,620 -
Other
comprehensive
income/(expense):
Actuarial gain
arising in
defined benefit
pension scheme,
net of tax - - - - - 887 887
Loss on cash flow
hedges, net of
tax - - - (673) - - (673)
At 29 January 2011 18,389 19,902 20,215 (337) - (43,761) 14,408
-------- -------- ----------- -------- -------- --------- --------
The premium of GBP7,620,000 arising on the share issue was
initially credited to a merger reserve and subsequently transferred
to the profit and loss reserve. Costs of GBP2,164,000 associated
with the firm placing and open offer have been charged to the
Company's share premium account.
ALEXON GROUP PLC
Consolidated Statement of Cash Flows
For the 52 weeks to 29 January 2011
2011 unaudited 2010
Note GBP000 GBP000 GBP000 GBP000
--------- --------- -------- ---------
Cash flows from operating
activities
Cash used in continuing
operations 5 (14,843) (8,409)
Interest received
(continuing operations) 34 96
Interest paid (continuing
operations) (219) (59)
Tax received (continuing
operations) 24 2,310
Tax paid (continuing
operations) (171) (694)
Cash used in discontinued
operations 5 (163) (6,100)
Net cash used in operating
activities (15,338) (12,856)
Investing activities
Income associated with the
disposal of a subsidiary
undertaking - 423
Purchase of property, plant and
equipment (continuing
operations) (2,548) (1,808)
Purchase of property, plant and
equipment (discontinued
operations) - (99)
Proceeds from disposals of
property, plant and
equipment (continuing
operations) 10 57
Net cash used in investing
activities (2,538) (1,427)
Financing activities
Long term borrowings 4,500 -
Issue of ordinary shares 20,320 -
Costs arising from the
issue of shares (2,164) -
Net cash generated from
financing activities 22,656 -
Net increase/(decrease) in
cash and cash equivalents 4,780 (14,283)
Cash and cash equivalents at the
beginning of the period (8,999) 5,284
Cash and cash equivalents
at the end of the period (4,219) (8,999)
--------- ---------
Cash and cash equivalents 656 650
Short term borrowings (4,875) (9,649)
--------- ---------
(4,219) (8,999)
--------- ---------
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information
This financial information does not comprise statutory
statements for the purposes of the Companies Act 2006. Financial
information contained in this announcement for the 52 weeks ended
29 January 2011 is unaudited and has been extracted from the draft
financial statements which will be delivered to the Registrar of
Companies in due course. Financial information for the 52 weeks
ending 30 January 2010 has been extracted from the statutory
accounts for that period. The report of the auditors on those
accounts was unqualified.
The directors approved this announcement on 28th April 2011.
Basis of preparation
Whilst the information included in this preliminary announcement
has been prepared in accordance with the recognition and
measurement criteria of International Financial Reporting Standards
("IFRS's) as adopted for use in the European Union and as issued by
the International Accounting Standards Board, this announcement
does not itself contain sufficient information to comply with
IFRS's.
The preliminary announcement for the 52 weeks ending 29 January
2011 has been prepared on a consistent basis with the financial
accounting policies set out in the Accounting Policies section of
the Alexon Group plc Annual Report and Accounts 2010 with the
exception of the following standards and amendments which have been
applied during the period:
-- IFRS 3 (revised), 'Business Combinations' and consequential
amendments to IAS27, 'Consolidated and separate financial
statements', IAS 28 'Investments in associates' and IAS31,
'Interests in joint ventures'; and
-- IAS 39 (Amendment), 'Financial instruments: Recognition and
measurement' and IFRIC 9 (Amendment), 'Reassessment of Embedded
Derivatives'.
The adoption of the above standards and amendments have only
impacted presentational aspects of the results for the 52 weeks
ending 29 January 2011 and have had no impact on the Group's
reported results.
Going Concern:
The financial information has been prepared on a going concern
basis
The Group has renegotiated its banking facilities with Barclays,
and reset its financial covenants. The new facilities incorporate
an additional GBP2.5m 1 year loan facility expiring on 28th April
2012 and deferral of the scheduled payment of GBP1.5m due in July
2011 to the same date. In addition, the Group is currently in the
process of selling its properties in Cardiff and Milton Keynes and
a proportion of the proceeds will be used to pay down bank debt.
The remaining facilities are unchanged.
Whilst trading conditions remain challenging, the directors
consider that they will be able to manage within the revised
facilities and covenants during the next year and will be able
secure the necessary financing on or before 28th April 2012.
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information
1. Exceptional items
1a Continuing operations
The following exceptional costs were incurred by the Group
during the period in relation to continuing operations.
2011 2010
GBP000 GBP000
Impairment of property, plant & equipment 164 460
Costs relating to onerous lease commitments - 12,388
Redundancy costs - 116
Exceptional items within cost of sales 164 12,964
------------ ------------
Pension curtailment gain - (599)
Fees relating to the restructuring of the
Group's finances 132 994
Restructuring costs 78 -
------------ ------------
Exceptional items within administrative
expenses 210 395
------------ ------------
Impairment of property, plant & equipment 178 -
Redundancy costs 121 -
------------ ------------
Exceptional items within distribution costs 299 -
------------ ------------
Total exceptional items 673 13,359
------------ ------------
The impairment of property, plant and equipment arises from a
comparison of the value-in-use of individual trading outlets with
their net book value where circumstances indicate a possible
impairment.
Onerous lease provisions are made in respect of those leases
which are considered onerous on the basis that the stores to which
they relate are expected to generate net cash outflows over their
remaining lease term. The provision represents the lowest net
unavoidable cost of a lease contract. It is calculated as
either:
-- the estimated exit cost in circumstances where it is thought
possible that an exit agreement can be negotiated with the
landlord, or,
-- the lower of the forecast trading losses or lease rental
costs for the remainder of the lease term.
The pension curtailment gain arises from the reduction in the
present value of the defined benefit scheme's liabilities resulting
from the decision to cease future benefit accrual as at 31 July
2009.
Costs relating to the restructure of the Group's finances are
professional fees incurred in the Group's capital restructuring and
negotiation of new banking facilities.
Redundancy and restructuring costs have been incurred as a
result of the amalgamation of the Group's distribution centres into
one location.
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information (continued)
1b Discontinued operations
On 27 April 2009 the Group placed Epcoscan Limited, which
operated the Bay Trading business, into administration. The
(loss)/profit included in discontinued operations is analysed
below.
2011 2010
GBP000 GBP000
Operating loss
Revenue - 12,339
Expenses (163) (18,202)
------- ---------
Operating loss (163) (5,863)
Net finance income - 2
------- ---------
Loss before taxation (163) (5,861)
Tax on operating loss 46 -
------- ---------
Loss after taxation (117) (5,861)
------- ---------
Net liabilities of subsidiary company disposed - 12,943
Proceeds of disposal - 1,300
------- ---------
Profit on disposal - 14,243
------- ---------
Total (loss)/profit from discontinued operations (117) 8,382
------- ---------
2. Segmental information
IFRS 8 requires operating segments to be determined based on the
Group's internal reporting to the Chief Operating Decision Maker
("CODM"). The CODM has been determined to be the Chief Executive
Officer and Finance Director as they are primarily responsible for
the allocation of resources to segments and the assessment of
performance of the segments.
The Group considers that its operations comprise a single
business segment as it meets the aggregation criteria included
within IFRS 8 on the basis that the individual clothing brands have
similar economic characteristics and are similar in respect of the
nature of their products, production processes, type of customer
and method of distribution.
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information (continued)
3. Taxation
2011 2010
GBP000 GBP000
The taxation credit for the period comprises:
Current Continuing
tax operations: - current period 186 228
- adjustment in respect of
previous periods (889) -
Total current
tax (703) 228
------- ---------
Deferred Continuing
tax operations: - current period (48) (18)
- adjustment in respect of
previous periods (30) (277)
Discontinued operations (46) -
------- ---------
Total deferred
tax (124) (295)
------- ---------
Total
taxation Continuing operations: (781) (67)
Discontinued operations (46) -
------- ---------
(827) (67)
Tax on items charged to equity:
Deferred tax credit on hedging instruments 255 1,414
Deferred tax charge on pensions (492) (45)
------- ---------
(237) 1,369
------- ---------
The tax for the period is lower (2010: higher) than
the standard rate of corporation tax in the UK (28%).
The differences are explained below:
Profit/(loss) on ordinary activities before taxation 86 (14,251)
------- ---------
Profit/(loss) on ordinary activities multiplied by
the standard rate of UK corporation tax of 28% 24 (3,990)
Effects of:
Expenses not deductible for non-qualifying
tax purposes: depreciation 64 65
other disallowables 363 1,297
unrelieved foreign tax 186 228
unrelieved trading losses
arising in the period 142 2,610
utilisation of tax losses
brought forward (641) -
Adjustments in respect of
previous periods (919) (277)
------- ---------
Total tax credit from continuing operations for the
period (781) (67)
------- ---------
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information (continued)
4. Earnings per share - continuing operations
The calculation of basic earnings per ordinary share is based on
earnings from continuing operations of GBP867,000 (2010: losses of
GBP14,184,000) and on 132,052,362 ordinary shares (2010:
44,686,680) being the weighted average number of ordinary shares in
issue.
In calculating diluted earnings per share the weighted average
number of ordinary shares in issue is adjusted to assume the
exercise of warrants to subscribe for ordinary shares which were
granted as part of the Capital Raising in March 2010.
2011 2010
--------- ------------ -------- ------------- ----------- --------
Weighted Weighted
average average
Per Per
Earnings number share Losses number share
(GBP) of shares (pence) (GBP) of shares (pence)
Basic
earnings/(losses) 867,000 132,052,362 0.66 (14,184,000) 44,686,680 (31.74)
Effect of dilutive
securities:
Warrants - 1,477,654 (0.01) - - -
--------- ------------ -------- ------------- ----------- --------
Diluted
earnings/(losses) 867,000 133,530,016 0.65 (14,184,000) 44,686,680 (31.74)
--------- ------------ -------- ------------- ----------- --------
Earnings per share - discontinued operations
The calculation of basic losses per ordinary share is based on
losses from discontinued operations of GBP117,000 (2010: earnings
of GBP8,382,000) and on 132,052,362 ordinary shares (2010:
44,686,680) being the weighted average number of ordinary shares in
issue.
2011 2010
---------- ------------ -------- ---------- ----------- --------
Weighted Weighted
average average Per
Per
Losses number share Earnings number share
(GBP) of shares (pence) (GBP) of shares (pence)
Basic
(losses)/earnings (117,000) 132,052,362 (0.09) 8,382,000 44,686,680 18.76
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information (continued)
Earnings per share - total operations
The calculation of basic earnings per ordinary share is based on
earnings from total operations of GBP750,000 (2010: losses of
GBP5,802,000) and on 132,052,362 ordinary shares (2010: 44,686,680)
being the weighted average number of ordinary shares in issue.
In calculating diluted earnings per share the weighted average
number of ordinary shares in issue is adjusted to assume the
exercise of warrants to subscribe for ordinary shares which were
granted as part of the Capital Raising in March 2010.
2011 2010
--------- ------------ -------- ------------ ----------- --------
Weighted Weighted
average average Per
Per
Earnings number share Losses number share
(GBP) of shares (pence) (GBP) of shares (pence)
Basic
earnings/(losses) 750,000 132,052,362 0.57 (5,802,000) 44,686,680 (12.98)
Effect of dilutive
securities:
Warrants - 1,477,654 (0.01) - - -
--------- ------------ -------- ------------ ----------- --------
Diluted
earnings/(losses) 750,000 133,530,016 0.56 (5,802,000) 44,686,680 (12.98)
--------- ------------ -------- ------------ ----------- --------
ALEXON GROUP PLC
52 weeks to 29 January 2011
Notes to the financial information (continued)
5. Notes to the statement of cash flows
2011 2010
GBP000 GBP000
Cash generated from continuing operations
Operating profit/(loss) - continuing operations 582 (13,723)
Adjustments for:
Depreciation 1,053 1,127
Impairment of property, plant and equipment 342 460
Loss on disposal of property, plant and equipment 88 66
Adjustment in respect of retirement benefit obligations (300) (999)
Changes in working capital:
Decrease in trade and other receivables 74 2,478
Increase in inventories (1,259) (788)
(Decrease)/increase in trade and other payables (4,905) 3,923
Decrease in long term provisions, accruals and deferred
income (10,518) (953)
Cash used in continuing operations (14,843) (8,409)
--------- ---------
2011 2010
GBP000 GBP000
Cash generated from discontinued operations
Operating loss - discontinued operations (163) (5,863)
Adjustments for:
Depreciation - 212
Changes in working capital:
Decrease in trade and other receivables - 1,546
Increase in inventories - (1,490)
Decrease in trade and other payables - (507)
Cash used in discontinued operations (163) (6,102)
Interest paid - (1)
Interest received - 3
Cash flows from operating activities - discontinued
operations (163) (6,100)
------- --------
6. Dividends
The Board has decided not to declare an ordinary dividend for
the 52 weeks ended 29 January 2011 (2010: nil).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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