RNS Number:9424L
Bright Futures Group PLC
05 May 2005
Bright Futures Group plc
Preliminary results for the year ended 31 December 2004
Highlights
# 2004 2003
Group turnover 4,631,539 5,354,610
EBITDA 6,449 178,097 (1)
(Loss)/profit before tax and amortisation (79,312) 103,903 (2)
Cash at bank 1,011,428 488,555
Stocks 839,792 807,131
Net current assets 1,946,171 1,257,374
(1), (2) excluding #145,100 profit on the sale of investments
At 05 May 2005, the Group has #650,000 in cash, unused bank facilities of
#300,000 and stock of #1,100,000 (post Shiloh plc acquisition).
Chairman's and Chief Executive Officer's Statement
Results
For the year ended 31 December 2004, Bright Futures Group ("the Group") achieved
sales of #4.63 m (2003: #5.35 m) and generated losses before taxation and
amortisation of #79,312 (2003: profit #103,903 excluding profit on sale of
investments).
Group losses in 2004 included #45,000 of costs associated with the change of
finance director and a #70,000 loss from a single model concept store which is
now trading at break-even.
Trading Review
The Group's vision is to become the largest UK Mobility Retailer. Our objectives
in 2004 were to:
* trade our new store concepts;
* raise money in order to accelerate our store opening; and
* continue to build our operational efficiencies in the Retail Support
Centre to prepare for an accelerated opening.
The Group has achieved these objectives.
Owned Stores
Like-for-like store based contribution grew by 35%. This reflects:
* increased gross margins through better category management;
* a decrease in advertising expenditure incurred in the 2003 test marketing
period; and
* more efficient operational management.
On a like-for-like basis sales declined 4% in 2004 versus the prior year
increase of 52%. Furthermore, the Mobility Scooter market is experiencing
significant price deflation pressures. To counter these market shifts, the
Group's category management team have started to introduce a series of new
categories to continue to improve the offer. Whilst the Group are confident that
these improvements can be achieved, new categories will not start to impact our
results until the second half of 2005.
Our retail stores continue to make a very positive contribution to the Group.
Having built the infrastructure to run a large retail chain, the Group now needs
to increase the number of stores. The Group's store opening plan has been
enabled by the successful placement of shares raising #835,000, net of costs.
New IT implementations are now complete enabling the Group to scale the estate,
whilst tightly controlling its performance, without significantly increasing the
central overhead.
Franchised Retail
The Group reduced the number of franchisees in 2004. Despite the lower number of
franchisees, profitability in the business has improved.
Internet
Youreable Limited, our internet business, steadily increased profitability
throughout the year
Non-Core Business
The Group experienced trading pressures in the non-core wholesaling operation
and accordingly, the Group has withdrawn significantly from this business
operation during the year.
Further withdrawals from other non-core business areas are the Group's direct
sales business and finance business. These combined withdrawals are the most
significant factors for the Group's decline in sales in 2004.
Outlook
The Group has developed a successful model store format. Our infrastructure is
now complete and we are confident that we have a sound platform for growth. The
Group plans to open 10 new stores in 2005 and have accelerated this by acquiring
5 stores from Shiloh plc at the end of March 2005. We have a strong balance
sheet with cash and stock available to facilitate our growth plans.
The Group is very cautious about the shorter term outlook in an increasingly
competitive retail environment. A proportion of our retail growth will be offset
by our non-core wholesale business withdrawal, which continues to be a very
competitive and low margin sector. As a consequence, the Group expects trading
to fall significantly short of current market expectations in 2005.
The Group remains focused on delivering long-term shareholder returns by scaling
our retail estate and is confident in our long-term strategy.
ANTHONY LEON DL FCA STEPHEN HARPIN BSc (Hons) DipM
Chairman Chief Executive Officer
Consolidated Profit and Loss Account
for the year ended 31 December 2004
Year ended Year ended
31 Dec 2004 31 Dec 2003
# #
----------- -----------
GROUP TURNOVER 4,631,539 5,354,610
Cost of sales 2,687,375 3,092,520
----------------------------- ----------- -----------
GROSS PROFIT 1,944,164 2,262,090
Goodwill amortisation 122,822 120,821
Operating costs 2,030,128 2,022,203
----------------------------- ----------- -----------
Administration expenses 2,152,950 2,143,024
----------------------------- ----------- -----------
OPERATING (LOSS)/PROFIT (208,786) 119,066
Interest: receivable 6,652 11,760
Interest: payable - (2,644)
----------------------------- ----------- -----------
(LOSS)/PROFIT ON ORDINARY ACTIVITIES BEFORE
TAXATION (202,134) 128,182
Tax on profit/(loss) on ordinary activities (737) (7,274)
----------------------------- ----------- -----------
(LOSS/PROFIT FOR THE FINANCIAL PERIOD (202,871) 120,908
----------------------------- ----------- -----------
(Loss)/earnings per share
Basic and diluted (0.57)p 0.36p
----------------------------- ----------- -----------
(Loss)/earnings per share before goodwill
amortisation
Basic and diluted (0.22)p 0.72p
----------------------------- ----------- -----------
The Group has no recognised gains or losses other than the results for the year
as set out above.
All of the activities of the Group are classed as continuing.
Consolidated Balance Sheet
for the year ended 31 December 2004
2004 2003 (restated)
# #
----------- -----------
FIXED ASSETS
Intangible assets 2,162,446 2,285,268
Tangible assets 353,987 227,271
------------------------------ ----------- -----------
2,516,433 2,512,539
----------- -----------
CURRENT ASSETS
Stocks 839,792 807,131
Debtors 709,168 761,514
Cash at bank 1,011,428 488,555
------------------------------ ----------- -----------
2,560,388 2,057,200
CREDITORS: Amounts falling due within one year (614,217) (799,826)
------------------------------ ----------- -----------
NET CURRENT ASSETS 1,946,171 1,257,374
------------------------------ ----------- -----------
TOTAL ASSETS LESS CURRENT LIABILITIES 4,462,604 3,769,913
CREDITORS: Amounts falling due after more than one
year (63,312) (2,248)
------------------------------ ----------- -----------
4,399,292 3,767,665
----------- -----------
CAPITAL AND RESERVES
Called up equity share capital 2,392,501 1,667,501
Share premium account 147,821 38,323
Other reserves 2,023,515 2,146,337
Profit and loss account (164,545) (84,496)
------------------------------ ----------- -----------
EQUITY SHAREHOLDERS' FUNDS 4,399,292 3,767,665
------------------------------ ----------- -----------
These financial statements were approved by the directors on 5 May 2005 and are
signed on their behalf by:
MR A C GREENWOOD MR S HARPIN
Consolidated Cash Flow Statement
for the year ended 31 December 2004
2004 2003
# # # #
-------- --------- -------- --------
NET CASH (OUTFLOW)/INFLOW FROM
OPERATING (177,712) 232,619
ACTIVITIES
RETURNS ON INVESTMENTS AND SERVICING
OF FINANCE
Interest received 6,652 11,760
Interest element of hire purchase - (2,644)
---------------------------- -------- --------- -------- --------
NET CASH INFLOW FROM RETURNS ON
INVESTMENTS AND 6,652 9,116
SERVICING OF FINANCE
TAXATION (7,117) (1,461)
CAPITAL EXPENDITURE
Receipts from sale of tangible fixed 5,812 -
assets
Payments to acquire tangible assets (131,516) (204,987)
---------------------------- ---------- -------- --------- --------
NET CASH (OUTFLOW) FROM CAPITAL
EXPENDITURE (125,704) (204,987)
---------------------------- ---------- -------- --------- --------
CASH (OUTFLOW)/INFLOW BEFORE (303,881) 35,287
FINANCING
FINANCING
Issue of equity share capital 870,000 -
Professional costs charged to the
share premium (35,502) -
account
Capital element of hire purchase (7,744) (14,011)
---------------------------- -------- --------- -------- --------
NET CASH INFLOW/(OUTFLOW) FROM 826,754 (14,011)
FINANCING -------- --------- -------- --------
----------------------------
INCREASE IN CASH 522,873 21,276
---------------------------- -------- --------- -------- --------
RECONCILIATION OF OPERATING (LOSS)/PROFIT TO NET CASH (OUTFLOW)/INFLOW FROM
OPERATING ACTIVITIES
Year ended Year ended
31 Dec 2004 31 Dec 2003
# #
----------- ------------
Operating (loss)/profit (208,786) 119,066
Amortisation 122,822 127,829
Depreciation 92,413 76,302
Loss on disposal of fixed assets - 1,200
Increase in stocks (32,661) (95,518)
Decrease in debtors 52,346 65,994
Decrease in creditors (203,846) (62,254)
----------------------------- ----------- -----------
Net cash (outflow)/inflow from operating
activities (177,712) 232,619
----------------------------- ----------- -----------
Consolidated Cash Flow Statement
for the year ended 31 December 2004
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
2004 2003
# #
----------- -----------
Increase in cash in the year 522,873 21,276
Cash outflow in respect of hire purchase 7,744 14,011
----------------------------- ----------- -----------
Change in net funds resulting from cash flows 530,617 35,287
New hire purchase (93,425) -
----------------------------- ----------- -----------
Movement in net funds in the year 437,192 35,287
Net funds at 31 December 2003 481,813 446,526
----------------------------- ----------- -----------
Net funds at 31 December 2004 919,005 481,813
----------------------------- ----------- -----------
ANALYSIS OF CHANGES IN NET FUNDS
At Cash Other At
31 Dec 2003 flows non-cash 31 Dec 2004
changes
# # # #
---------- ---------- ---------- ----------
Net Cash:
Cash in hand and at bank 488,555 522,873 - 1,011,428
Debt:
Hire purchase agreements (6,742) 7,744 (93,425) (92,423)
------------------ ---------- ---------- ---------- ----------
Net funds 481,813 530,617 (93,425) 919,005
------------------ ---------- ---------- ---------- ----------
Notes
1. This preliminary announcement does not consist of a full set of statutory
accounts for the year ended 31 December 2004, within the meaning of Section 240
Companies Act 1985.
2. The reserves as at 31 December 2004 have been restated, as the Group has
taken advantage of Section 131 Companies Act 1985.
3. The full statutory accounts, upon which the auditors have expressed an
unqualified opinion, will be filed with the Registrar of Companies before 30
June 2005.
4. The annual report and accounts will be posted to shareholders by 13 May 2005
and will be available upon application from the Company's registered office at
21 Planetary Road, Willenhall, Wolverhampton, WV13 3XA.
This information is provided by RNS
The company news service from the London Stock Exchange
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