RNS Number : 1369U
Stanley Gibbons Group PLC
01 April 2021
The Stanley Gibbons Group plc
Trading Statement and Corporate Update
The Stanley Gibbons Group plc today issues an update on trading
and other business developments.
Trading update for the year to 31 March 2021
Overall the trading patterns which we have previously seen in
the first half of our financial year have continued. Namely
increased levels of digital activity and remote selling of albums
and accessories contrasting with lower levels of high ticket sales
and in person activities as a result of the third lockdown.
While the patterns have been consistent with the above,
underlying trading has however been better than in the first half
of the financial year.
Although the philatelic side remains challenging there have been
more 'less bad' months recently and as previously disclosed, we
were also able to complete a very significant trade transaction of
old stock towards the tail end of 2020. The main aspects impacting
this part of the business are challenges with sourcing new
material, the lack of exhibitions which often boost higher end
sales and the overall impact on our auctions business which is
skewed towards our physical location.
Our publishing business has benefitted from what we believe are
significant market share gains as well as hobbies as a whole
benefitting to some degree through the restrictions imposed on
everyday life. This was partially offset by a failure to produce
one of our annual catalogues towards the end of 2020. We continue
to work on developing the digital elements of the business,
something which has proven challenging at times but is increasingly
giving us cause for optimism about the future. We are also
extremely conscious that a lot of customers in this part of the
business do not deal with our Philatelic department, something we
are working to address.
Although challenged by our inability to open the shop, Baldwin's
has continued to trade reasonably well through the last few months
with the acquisition of some good material being helped by a strong
underlying market. After a four year partnership with St James'
Auctions, we have also jointly agreed to terminate our coin auction
joint venture early, end of April 2021, and at no cost. This is a
major milestone in the development of Baldwin's and we are very
excited to be able to bring coin auctions back in house after a
four year hiatus.
The shop itself has been closed for some time and even when we
were allowed to open, Central London was particularly quiet. This
is extremely frustrating having completed the redevelopment project
and created what we believe is an unrivalled destination for those
interested in our hobbies. The shop team have continued to serve
customers remotely, ensuring that in conjunction with the other
departments and our customer services team that we have been as
accessible, helpful and responsive as possible to our
We are hopeful that a vaccine led relaxing of restrictions is
not only permanent but encourages activity levels to return at
pace, however, this is hard to predict and we have plans in place
if this is not how things develop.
Throughout the past year we have proactively engaged with many
of the wider stakeholders in our business, taking the view that
frequent and open conversation is paramount in trying to foster a
collaborative approach to the challenges caused by COVID-19.
While many of these are ongoing, in the main this has proven
successful and we are grateful to those parties for their
Our primary creditor and majority shareholder has remained
extremely supportive and engaged, the most tangible element of
which being their willingness to once again waive the loan
covenants which we are in default of. We have now received written
confirmation of this waiver. The next financial covenant test of
our loan facilities are in March 2022.
We continue to have a constructive dialogue with the pension
scheme trustees and our landlords/lessors, with agreements in
principle having been made for lease amendments on both of the
properties we actively operate from and a reallocation of the lease
to our sub-tenant for the third UK location.
As previously highlighted, regarding our leasehold property in
the US, our sub-lessor, despite being backed by one of the largest
and most profitable businesses in the world, is attempting to walk
away from their lease commitments without making any form of
restitution. We are challenging this and while the process is a
long one, we are hopeful of a mediation driven resolution in the
Our insurance claim for business interruption due to the
pandemic, which was originally denied, was reviewed by our insurer
following the Supreme Court ruling but was unfortunately once again
denied. We continue to believe that we may have a valid claim with
arguments such as 'the coronavirus outbreak would not amount to an
"emergency event".....' giving us an unwelcome insight into how
some insurers have treated their customers. We are currently taking
legal advice and considering whether to take further action.
In contrast, we welcome the Government's continued support for
business through the extension of the furlough scheme and in
particular further business rates concessions. It is our hope that
this is a prelude to a new, long overdue, more proportional
approach to business rates.
In November 2020, as part of our interim announcement the
Board's expectation was that we would draw down the remaining
GBP2mn of our loan facility within the next 12 months. We are
hopeful that this will now prove to have been too conservative.
However it is important to note that at the current time the
business continues to be cash negative, while trading conditions
and the impact on our longer-term funding position remain uncertain
with the latter influenced by our negotiations with our long term
Graham Shircore, Group CEO said;
'It is almost a year to the day that we prepared a plan for what
we should expect as a result of the newly introduced Coronavirus
At that time we would never have considered still being in
lockdown 12 months later and we were similarly amiss in our
financial assumptions. Our initial estimates were that we would
have to draw down further on our debt facility by May of last
Despite increasing our spending on those initiatives which will
help propel the business forward in future years, we are yet to do
This achievement is down to how our colleagues responded to the
crisis and it is something I am extremely proud of. As
shareholders, they all deserve our thanks.
The benefit of their achievements are however not just felt in
the present. It allowed us to shift our focus far more heavily to
coming out of the crisis relatively stronger than we went in and
while we have undoubtedly been financially impacted by COVID-19, I
am also confident that this is the case.
We are hopeful that the relaxation of restrictions, combined
with greater participation in the hobbies we serve and our hard
work bodes well for our prospects. However we are under no illusion
that this is guaranteed and it is incumbent upon us to shape our
own future, during these uncertain times. We must redouble our
efforts in order to reap the benefits of the progress we have made,
we cannot afford to take our foot off the pedal.'
The Stanley Gibbons Group plc +44(0)207 836 8444
Graham Shircore (Chief Executive Officer)
Anthony Gee (Chief Finance Officer)
Liberum Capital Limited (Nomad and Broker) +44(0)20 3100
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(END) Dow Jones Newswires
April 01, 2021 02:00 ET (06:00 GMT)
Stanley Gibbons (LSE:SGI)
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