RNS Number:6446N
Dobbies Garden Centres PLC
11 July 2000
DOBBIES GARDEN CENTRES plc
Interim Results for the Six Months ended 30 April 2000
- Turnover #9.14m up 41%
- Operating profit #959,000 up 72%
- Profit before tax #720,000 up 41%
- Earnings per share 8.15p up 41%
- Interim dividend 2.0p
- #10m raised through successful placing
- Addition of 5 new garden centres
"There is no doubt that your Company is immeasurably stronger
than it was even six months ago."
"Dobbies Garden Centres is emerging as an important company
within the garden centre industry in the UK. Of our 15
centres we have three superstores with sales potential of #3-
5m and, through investment and redevelopment of other existing
stores, the potential to add another five. We plan to do this
in the next 2 to 3 years."
"We remain enthusiastic and optimistic about our long term
prospects. In the absence of unforeseen circumstances, we
should be able to report further progress in our sales and
profits next February."
Alex Hammond-Chambers
Chairman
Enquiries:
Dobbies Garden Centres plc Bell Pottinger Financial
James Barnes Jonathon Brill/
Managing Director Caroline Sturdy
Tel: 0131 663 1941 Tel: 020 7353 9203
Chairman's Statement
May I first of all thank old and new shareholders for
supporting them in the raising of #10 million of new equity.
Indeed this first six months has brought about the biggest
change in our size ever, with the raising of the #10 million
and the acquisition of Findlay Clark (with its four garden
centres in Scotland) and of Clifton Garden Centre, located
near Preston. By the end of the period we were operating ten
centres in Scotland (giving us a strong market position) and
five in England - 15 in all. The funds received from our
equity issue were received just after the end of April (and
are therefore not reflected in the 30 April balance sheet);
our shareholders' funds after the fund raising now stand at
just over #23 million, approximately 92% higher than a year
ago. There is no doubt that your Company is immeasurably
stronger than it was even six months ago.
We are happy to report that your Company has continued to make
progress in the development of its business during the last
six months. Our sales rose 41% from #6.46 million to #9.14
million against a background of good progress from our
existing stores (like for like sales rose 11%). Sales were
also affected by further redevelopment at our Melville and
Birtley centres, a full six months of trading from Dundee and
Shrewsbury, five new centres (acquired in April 2000) and
perfectly appalling weather during April. The weather always
gets a mention because it can and does have an effect on sales
and profits in the short term. However, it needs to be kept
in perspective because over the long term it is our retailing
and our corporate growth performance which dictate our
progress.
Profits before tax for the six months also rose 41% reaching
#720,000. This increase has been driven by our strong sales
performance combined with a widening of operating margins,
partly offset by a higher interest charge (#239,000 v
#48,000). Earnings per share amounted to 8.15p, again 41%
higher than a year ago - 5.78p per share. The Board of
Directors has declared an interim dividend of 2.00p per share
(v 1.82p last year), payable on 31 October 2000 on the share
capital as increased by the equity issue.
Our borrowings at the end of April stood at #16.3 million,
compared with just #4.9 million at the year end of last year.
The increase is accounted for by the cost of the two
acquisitions we made in April. Our borrowings are
significantly lower following the receipt on 3 May 2000 of the
#10 million from the equity issue. If we were to make an
adjustment to our April balance sheet for this, we would have
had equity capital of c#23 million and borrowings of
c#6million, which is well within both our banking facilities
and our balance sheet policies.
Dobbies Garden Centres is emerging as an important company
within the garden centre industry in the UK. As a result of
the latest acquisitions we are now positioned third in terms
of number of stores. But we would like to think that in
certain aspects we are a leader, particularly in terms of the
development of state of the art large garden centres. Of our
15 centres we have three superstores (Melville, Gailey and
Dundee) with sales potential of #3-#5 million and, through
investment and redevelopment of other existing stores, the
potential to add another five. We plan to do this in the next
2 to 3 years.
Getting the most out of our existing portfolio of centres is
an important aspect of our growth strategy. Building on the
strength of our management team, however, is probably the most
important ingredient of success. We would like to welcome
Sharon Brown to the Board; she has been appointed our Finance
Director. We would also like to welcome the management and
staff of Findlay Clark and Clifton to our Company. These two
acquisitions are making a contribution to that management
development. That said, we believe it is still early days in
terms of the Company's development and the roll out of the new
larger store concept. If we are to continue to build the
business successfully in the future, we will need to invest in
the further strengthening of our management team and more
aggressive development of our IT capability.
Progress is never made without commitment and hard work and on
behalf of shareholders I would like to thank the management
and staff for their efforts. We remain enthusiastic and
optimistic about our long term prospects and with their
commitment we will continue to grow the Company. In the
absence of unforeseen circumstances, we should be able to
report further progress in our sales and profits next
February.
Alex Hammond-Chambers
Chairman
Dobbies Garden Centres plc
Consolidated Profit and Loss Account
Unaudited six Year ended
months 31 October
ended 30 April
2000 1999 1999
#000 #000 #000
Turnover
Continuing operations 8,383 6,464 15,832
Acquisitions 755 - -
--------- ---------- ----------
9,138 6,464 15,832
Cost of sales (5,016) (3,613) (8,583)
--------- ---------- ----------
Gross profit 4,122 2,851 7,249
Administrative and selling
expenses (3,412) (2,521) (5,623)
Other operating income 249 228 517
--------- ---------- ----------
Operating profit 959 558 2,143
Interest payable less
interest receivable (239) (48) (197)
--------- ---------- ----------
Profit on ordinary
activities before
taxation 720 510 1,946
Tax on ordinary activities (180) (127) (490)
--------- ---------- ----------
Profit on ordinary
activities after taxation 540 383 1,456
Dividends (181) (120) (364)
--------- ---------- ----------
Profit for the period 359 263 1,092
--------- ---------- ----------
Earnings per share 8.15p 5.78p 22.00p
--------- ---------- ----------
Diluted earnings per share 7.94p 5.64p 21.49p
--------- ---------- ----------
Dividend per share 2.00p 1.82p 5.50p
--------- ---------- ----------
Dobbies Garden Centres plc
Consolidated Balance Sheet
Unaudited six Year ended
months 31 October
ended 30 April
2000 1999 1999
#000 #000 #000
Fixed assets 31,743 17,186 17,788
--------- ---------- ----------
Current assets
Stocks 5,212 3,523 3,141
Debtors 1,165 957 419
Cash at bank and in hand 34 27 209
--------- ---------- ----------
6,411 4,507 3,768
--------- ---------- ----------
Creditors: amounts falling
due within one year (24,521) (9,182) (8,199)
--------- ---------- ----------
Net current
assets/(liabilities) (18,110) (4,675) (4,431)
--------- ---------- ----------
Total assets less current
liabilities 13,633 12,511 13,357
Creditors: amounts falling
due after more than one
year (97) (190) (197)
Provisions for liabilities (140) (130) (140)
and charges
--------- ---------- ----------
Net assets 13,396 12,191 13,020
--------- ---------- ----------
Capital and reserves
Equity shareholders' funds 13,396 12,191 13,020
--------- ---------- ----------
Dobbies Garden Centres plc
Reconciliation of Movements in Shareholders' Funds
Unaudited Year
ended
Six months ended 31
30 April October
2000 1999 1999
#000 #000 #000
Profit for the financial
period 540 383 1,456
Dividends (181) (120) (364)
New share capital
subscribed 1 - -
Share premium arising 16 - -
------------ ----------- -----------
376 263 1,092
Opening shareholders'
funds 13,020 11,928 11,928
------------ ----------- -----------
Closing shareholders'
funds 13,396 12,191 13,020
------------ ----------- -----------
Consolidated Cash Flow Statements
Unaudited Year
ended
Six months ended 30 April 31
October
2000 1999 1999
#000 #000 #000
Cashflow from operating
activities 2,882 1,795 2,562
Returns on investments and
servicing of finance (252) (48) (211)
Taxation (136) (44) (440)
Capital expenditure and
financial investment (2,325) (2,547) (3,646)
Acquisitions and disposals (8,371) (3,436) (3,003)
Equity dividends paid (244) (222) (342)
----------- ----------- -----------
Cash outflow before use of
liquid resources and
financing (8,446) (4,502) (5,079)
Financing (2,958) (97) (93)
------------ ----------- -----------
Increase/(decrease) in
cash in period (11,404) (4,599) (5,172)
------------ ----------- -----------
Dobbies Garden Centres plc
Notes
1. The financial information for the six months ended 30
April 2000 and the comparative figures for the six months
ended 30 April 1999 are neither audited nor reviewed and
have been prepared on the basis of the accounting
policies set out in the statutory accounts for the year
ended 31 October 1999. This financial information does
not constitute statutory accounts as defined in section
240 of the Companies Act 1985. The financial information
for the year ended 31 October 1999 has been extracted
from the statutory accounts which, together with an
unqualified audit report, have been delivered to the
Registrar of Companies.
2. The calculation of earnings per share is based on the
profit after tax for the financial period divided by
6,620,133 ordinary shares, being the weighted average
number of ordinary share in issue. The diluted earnings
per share for the period is based on the profit after tax
for the financial period divided by 6,802,503 being the
number of potential ordinary shares calculated in
accordance with Financial Reporting Standard 14.
3. Properties are carried within Fixed Assets at cost. The
directors are considering the impact of Financial
Reporting Standard 15 with regards to the future
accounting policy.
4. The Directors have declared an interim dividend of 2.00p
net per ordinary share. The dividend will be payable on
31 October 2000 to shareholders on the register at 29
September 2000.
5. RECONCILIATION OF OPERATING PROFIT TO OPERATING CASHFLOW
Unaudited Year
ended
Six months ended 30 April 31
October
2000 1999 1999
#000 #000 #000
Operating Profit 959 558 2,143
Depreciation charge 311 200 425
Profit on sale of
tangible fixed assets (38) (2) (4)
(Increase)/decrease in
stock (843) (1,107) (181)
(Increase)/decrease in
debtors (572) (677) (111)
Increase/(decrease) in
creditors 3,065 2,823 290
------------ ------------ -----------
Increase/(decrease in
cash in period 2,882 1,795 2,562
------------ ------------ -----------
6. RECONCILIATION OF NET CASHFLOW TO MOVEMENT IN NET DEBT
The secured obligations are the subject of a fixed and
floating charge over the Company's assets
Unaudited Year ended
Six months ended 30 April 31 October
2000 1999 1999
#000 #000 #000
Increase/(decrease)
in cash in period (11,404) (4,599) (5,172)
Cash outflow from
debt and hire
purchase 2,958 96 93
Loans acquired with
subsidiary (2,841) - -
------------- ------------ ------------
Movement in net debt
in the period (11,287) (4,503) (5,079)
Opening net debt (5,015) 64 64
------------ ------------ ------------
Closing net debt (16,302) (4,439) (5,015)
------------ ------------ ------------
7. CONTINGENT LIABILITY
Under the terms of the acquisition in 1999 of Bayley's
Garden Centre, there is potential for additional
consideration of #600,000 to be payable contingent upon
certain conditions being met.
8. Copies of this statement will be sent to all shareholders
and will be available from the registered office,
Melville Nursery, Lasswade, Midlothian, EH18 1AZ.
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