RNS Number: 8275R
Allied Leisure PLC
2 October 2000
EMBARGOED UNTIL 0700 2 October 2000
ALLIED LEISURE PLC
("ALLIED" OR "THE GROUP")
PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 2000
Highlights
* A year of major progress in building a significant Leisure Group
* Turnover up 89% to #115.8 million (1999: #61.2 million)
* Profit before tax and exceptional items up 106% to #8.4 million (1999:
#4.1 million)
* Earnings per share after exceptional items up 88% to 10.04p (1999:
5.33p)
* Net assets at 30 June 2000 amount to #70 million (1999: #59.6 million)
Ken Scobie, Chairman of the Group, said:-
"Allied Leisure is now a significant Leisure Group with market leading
positions in cue sports and tenpin bowling as well as a major presence in
Burger King franchised restaurants. The Group has a number of high quality
leisure assets and is well set for further growth and a successful and
profitable future".
Enquiries:-
Allied Leisure PLC
Ken Scobie, Chairman 0498 624 765
Neil Goulden, Chief Executive 07771 963395
Square Mile Communications 020 7601 1000
Tim Jackaman/Becky Jewers
PRELIMINARY RESULTS ANNOUNCEMENT
CHAIRMAN'S STATEMENT
Shareholders will by now be aware of the offer made to Allied shareholders on
21st September 2000 by Georgica PLC.
Georgica PLC Offer
On 21st September 2000, Georgica PLC announced an offer to acquire the entire
issued share capital of Allied Leisure. Georgica is a newly formed public
company established for the purpose of making the offer and is offering one
new Georgica share for each Allied share. Georgica has applied to admit the
Georgica shares onto the AIM market and the offer is conditional upon the
London Stock Exchange announcing that it has agreed to admit the Georgica
shares to trading. Assuming full acceptance of the offer, Allied shareholders
will own 99.8% of the issued ordinary share capital of Georgica.
On 26th September 2000, Georgica announced that it had received acceptances in
respect of 50.8% of the issued share capital of Allied Leisure and declared
its offer unconditional as to acceptances. The offer is still subject to
certain conditions, most notably the admission of Georgica PLC to the AIM
market.
The Allied Board is currently considering the implications of the offer by
Georgica PLC and will be writing to shareholders with their formal advice on
or before 5th October 2000. In the meantime, shareholders are advised to take
no action in respect of the offer by Georgica.
Report on the Year
Irrespective of the Georgica offer, it is my duty, and indeed my pleasure, to
update shareholders on Allied's progress in the 1999/2000 financial year,
ended 30th June 2000.
During the year to 30th June 2000, Allied made major progress towards our goal
of building a significant leisure group through:-
* Successfully completing the integration of European Leisure PLC
following the merger in June 1999.
* Forming a company with Duke Street Capital to purchase, in September
1999, the Family Entertainment Division of First Leisure Corporation PLC
for #111.5 million.
* Merging Allied's Megabowl tenpin bowling centres into that company for
#50.6 million in December 1999 and then acquiring a 50% stake in the
company to form a joint venture with Duke Street Capital.
* Completing the acquisition of Waterfall Holdings PLC in May 2000.
* Continuing the highly successful expansion of the Rileys Cue Sports
brand, opening 17 new units during the year.
* Disposing of 40 bars and discotheques to various purchasers, raising
approximately #38.1 million in cash.
* Significantly improving the profitability of our Burger King franchised
restaurant business.
As a result Allied, together with the Megabowl joint venture, now operates 287
outlets with an annualised turnover of circa #160.0 million and over 6,000
employees.
Financial Results
Turnover, including our share of the joint venture, rose by 89% to #115.8
million (1999: #61.2 million) and operating profit from ordinary activities,
before exceptional items, increased by 112% to #12.9 million (1999: #6.1
million). Profit before tax and exceptional items increased by 106% to #8.4
million (1999: #4.1 million) whilst earnings per share after exceptional items
were 10.04p (1999: 5.33p). Net debt at 30th June 2000 was #48.3 million (1999:
#51.9 million) and year-end gearing was 69% (1999: 87%). Net assets as at 30th
June 2000 were #70.0 million (1999: #59.6 million) an increase of 18%.
Dividend
The Board is recommending a final dividend of 4.0p per share, to be paid on
12th January 2001 to shareholders on the register on 6th October 2000,
bringing the total for the year to 6.0p (1999: 5.75p after adjusting for share
consolidation). However, shareholders should be aware that the payment of the
dividend is subject to approval by shareholders at Allied's AGM on 24th
November 2000, by which time the majority of Allied's shares may be held by
Georgica PLC.
Review of Operations
Allied now operates in four sectors of the leisure and hospitality industry:-
* Cue Sports - Allied is the largest Cue Sports operator in the UK with
over 160 locations nationwide. The Division trades primarily under the
Rileys American Pool and Snooker brand. The business is clearly focused on
further enhancing the quality and profitability of our existing estate
whilst continuing the successful expansion of the Rileys concept,
currently at the rate of 25 new openings a year.
* Megabowl Joint Venture - Megabowl is the clear market leader in the UK
with 58 tenpin bowling based family entertainment centres stretching from
Aberdeen to Plymouth. With a national distribution network and a customer
base estimated at over 5 million customers per annum, the Board believes
that the Megabowl brand has enormous potential. The key to the successful
development of Megabowl will lie in the recruitment of a high quality
management team fully focused on leveraging the brand's critical mass and
customer base through an upgraded leisure experience, high quality service
and a creative approach to sales and marketing. Allied's results include
its 50% share of Megabowl Group Ltd and its funding structure means that
investments by Megabowl are independently funded with no recourse to, or
commitment by, Allied.
* Burger King - Allied is one of the leading franchise groups within the
Burger King system in the UK trading from 35 restaurants in the East
Midlands and Yorkshire/Tyne-Tees. Our Burger King business made
significant progress in the year to 30th June 2000. Sales were up on a
like for like basis and margins were significantly improved. We now have a
high quality franchise business and a strong relationship with the brand
owner. We believe that the Burger King brand has significant growth
potential in the UK and as a key franchise partner, we are well positioned
to capitalise on that growth, both through our existing restaurants and
the selective expansion of our estate.
* Leisure Division - the Leisure Division now comprises approximately 20
trading locations which are included in the balance sheet as assets held
for re-sale. Our disposal programme is ongoing and current levels of
interest are encouraging.
Board and Employees
As this is probably the last opportunity that I will have to write to
shareholders as Chairman of Allied as an independently quoted public company,
I would like to take this opportunity to thank all the employees of the Group
for their unstinting commitment and loyalty over the past six years. Allied
Leisure is now a far cry from the virtually bankrupt company that I inherited
in September 1994, and this is in no small part due to the efforts of all our
staff. Their acceptance of continuous change, in an often difficult trading
environment, has been magnificent.
Prospects
Allied Leisure is now a significant leisure group with market leading
positions in cue sports and tenpin bowling as well as a major presence in
Burger King franchised restaurants. The Group has a number of high quality
leisure assets and is well set for further growth and a successful and
profitable future.
Ken Scobie 2 October 2000
Chairman
ALLIED LEISURE PLC
Preliminary Results for the year ended 30 June 2000
Consolidated Profit and Loss Account
Before
Continuing exceptional Exceptional
operations Acquisitions items items 2000 1999
#000 #000 #000 #000 #000 #000
Turnover
Group and share of 113,739 2,069 115,808 - 115,808 61,214
joint venture
Less: share of (21,451) - (21,451) - (21,451) -
joint venture's
turnover
92,288 2,069 94,357 - 94,357 61,214
Cost of sales (42,205) (1,011) (43,216) - (43,216)(25,011)
Gross profit 50,083 1,058 51,141 - 51,141 36,203
Net operating (40,926) (1,028) (41,954) (1,176)(43,130)(33,480)
expenses
Operating profit
Ordinary
activities
before
exceptional
costs
9,157 30 9,187 - 9,187 6,075
- - - (1,176) (1,176) (3,352)
Exceptional
costs
Group operating 9,157 30 9,187 (1,176) 8,011 2,723
profit
Share of operating 3,720 - 3,720 (129) 3,591 -
profit in joint
venture
Total operating 12,877 30 12,907 (1,305) 11,602 2,723
profit
(Loss)/profit on - (141) (141) 618
sale of operations
Amounts written off - (267) (267) -
investments
Share of profit on - 555 555 -
sale of fixed
assets of joint
venture
Profit on ordinary 12,907 (1,158) 11,749 3,341
activities before
interest and tax
Net interest
payable
Group
(2,617) (514)(3,131)(1,989)
Group interest
receivable from
joint venture
2,299 - 2,299 -
Share of joint
venture
interest
(4,180) - (4,180) -
(4,498) (514) (5,012) (1,989)
Profit on ordinary 8,409 (1,672) 6,737 1,352
activities before
tax
Tax on profit on
ordinary activities
Group
(1,757) 507 (1,250) -
Share of joint
venture tax
- - - -
(1,757) 507 (1,250) -
Profit for the 6,652 (1,165) 5,487 1,352
financial year
Dividends (3,308) (2,531)
Transfer to/(from) 2,179 (1,179)
profit and loss
account in respect
of current year
activities
Basic earnings per 12.17p 16.10p
share before
exceptional items
Basic earnings per 10.04p 5.33p
share after
exceptional items
Diluted earnings 10.01p 5.31p
per share
ALLIED LEISURE PLC
Preliminary Results for the year ended 30 June 2000
Group Balance Sheet as at 30 June 2000
2000 2000 1999 1999
#000 #000 #000 #000
Fixed assets
Intangible assets 10,848 383
Tangible assets 84,978 85,104
Investments 533 5,122
96,359 90,609
Investment in joint venture
Share of gross assets 81,239 -
Share of gross liabilities (79,731) -
Share of net assets 1,508 -
Share of loan stock in joint venture 30,338 -
31,846 -
128,205 90,609
Current assets
Stocks 1,022 2,014
Debtors 4,944 10,215
Assets held for resale 11,704 43,514
Cash at bank and in hand 5,385 1,628
23,055 57,371
Creditors: amounts falling due within one year (37,146) (42,649)
Net current (liabilities)/assets (14,091) 14,722
Total assets less current liabilities 114,114 105,331
Creditors: amounts falling due after more than (40,269) (41,069)
one year
Provisions for liabilities and charges (3,811) (4,709)
(44,080) (45,778)
Net assets 70,034 59,553
Capital and reserves
Called up share capital 13,674 13,504
Share premium account 13,996 13,981
Other reserves 29,355 28,725
Profit and loss account 13,009 3,343
Group shareholders' funds - equity interests 70,034 59,553
ALLIED LEISURE PLC
Preliminary Results for the year ended 30 June 2000
Group Cash Flow statement for the year ended 30 June 2000
2000 2000 1999 1999
#000 #000 #000 #000
Net cash inflow from operating activities 1,146 9,620
Returns on investments and servicing of finance
Interest paid
(2,606) (2,046)
Financing costs
(551) -
Interest received
18 58
Interest element of finance lease payment
(49) (36)
Net cash outflow from returns on investment
and servicing of finance (3,188) (2,024)
Taxation
Corporation tax paid
(303) -
Advanced corporation tax paid
- (104)
(303) (104)
Capital expenditure and financial investment
Purchase of tangible fixed assets
(13,732) (3,750)
Sale of tangible fixed assets
992 282
Sale of assets held for resale
38,108 -
Purchase of intangible fixed assets
- (60)
Net cash inflow/(outflow) from investing 25,368 (3,528)
activities
Acquisitions and disposals
Purchase of loan stock in joint venture
(1,820) -
Purchase of Waterfall Holdings
(15,387) -
Costs associated with acquisition of
Waterfall Holdings
(640) -
Net cash acquired with Waterfall Holdings
49 -
Purchase of Burger Kings
(350) (1,499)
Costs associated with acquisition of Burger
Kings
- (91)
Net cash acquired with Burger Kings
- 17
Costs associated with acquisition of European
Leisure
- (271)
Net cash acquired with European Leisure
- 412
Disposal of operating units
- 61
Cash received on disposal of Bowls
23,221 -
Net cash disposed of with operating units
(135) (3)
Net cash inflow/(outflow) from acquisitions and 4,938 (1,374)
disposals
Equity dividends paid (3,199) (1,284)
Net cash inflow before use of
liquid resources and financing 24,762 1,306
Financing
New term borrowings
23,041 -
Repayment of term borrowings
(52,680) (2,320)
Capital element of finance lease borrowings
(262) (207)
New finance leases
- 682
Issue of ordinary share capital
518 -
Share issue costs
- (150)
Net cash outflow from financing (29,383) (1,995)
Decrease in cash in the year (4,621) (689)
Financial information
The above financial information does not constitute statutory accounts within
the meaning of Section 240 of the Companies Act 1985. The financial information
for the year ended 30 June 2000 and the year to 30 June 1999 has been extracted
from the Group's financial statements at those dates which received unqualified
auditors' reports. The financial statements for the year ended 30 June 1999
have been delivered to the Registrar of Companies.
Earnings per share
Having adopted FRS 14, basic earnings per share are calculated on Group profit
after tax divided by the weighted average number of ordinary shares in issue
during the relevant period. The weighted average number of shares has been
adjusted to reflect the 1 for 5 share consolidation that took place during the
year. The comparative figures have been adjusted accordingly.
Basic earnings per share before exceptional items, which reflects better the
underlying performance of the Group, has been calculated on the Group profit
after tax but excluding exceptional items divided by the weighted average
number of ordinary shares in issue during the relevant period. Diluted
earnings per share are based on the Group profit after tax. The diluted
weighted average number of shares has been adjusted on the assumption of the
exercise of the share options in issue.
2000 1999
000 000
Basic weighted average number of shares 54,665 25,354
Dilutive potential ordinary shares
Executive share options
146 97
Employee share options
23 1
Diluted weighted average number of shares 54,834 25,452
#000 #000
Group profit after tax 5,487 1,352
Exceptional items 1,672 2,734
Tax effect of exceptional items (507) -
Group profit after tax excluding exceptional items 6,652 4,086
Reconciliation of net cash flow to movement in net debt
2000 1999
#000 #000
Decrease in cash in the year (4,621) (689)
Cash outflow from decrease in debt and lease financing 29,901 1,845
Change in net debt resulting from cash flows 25,280 1,156
Loans acquired with European Leisure - (34,500)
Loans acquired with Waterfall Holdings (21,032) -
Loan stock issued on acquisition of Waterfall Holdings (615) -
Net debt at 1 July 1999 (51,912) (18,568)
Net debt at 30 June 2000 (48,279) (51,912)
Reconciliation of operating profit to net cash inflow from operating
activities
2000 1999
#000 #000
Operating profit 8,011 2,723
Depreciation and amortisation charges 3,457 3,430
Loss/(profit) on disposal of fixed assets 3 (64)
Decrease/(increase) in stocks 233 (1)
Decrease/(increase) in debtors 3,639 (1,213)
(Decrease)/increase in creditors (12,087) 3,544
Net cash inflow pre-restructuring and exceptional costs 3,256 8,419
Provision for vacant properties 380 2,049
Provisions utilised (2,490) (848)
Net cash inflow from operating activities 1,146 9,620
Reconciliation of movements in reserves and shareholders' funds
Called-up Share Other Profit Total
share premium reserves and loss shareholders'
capital account account funds
Group #000 #000 #000 #000 #000
As at 1 July 1999 13,504 13,981 28,725 3,343 59,553
Profit for the year - - - 5,487 5,487
Dividends - - - (3,308) (3,308)
Goodwill written back - 7,487 7,487
Issue of ordinary shares 170 15 630 - 815
As at 30 June 2000 13,674 13,996 29,355 13,009 70,034
Report and Accounts
Copies of the 2000 Report and Accounts will be sent to shareholders in due
course and further copies will be available to the public from the Group's
registered office, Charnwood Mill, Sileby Road, Barrow-Upon-Soar, Loughborough,
Leicestershire, LE12 8LR.
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