TIDMGMG
RNS Number : 3966T
Game Group PLC
28 September 2010
The GAME Group plc
Highlights
THE GAME GROUP PLC, Europe's leading retailer of pc and video games products,
today announces its Interim Results for the 26 weeks ended 31 July 2010.
Interim Results for the 26 weeks ended 31 July 2010
Highlights
+---------------+-----------+--------------+
| All | Unaudited | Unaudited |
| figures | Six | six |
| in | months | months |
| GBP'm | ended | ended 31 |
| (unless | 31 July | July 2009 |
| stated) | 2010 | |
+---------------+-----------+--------------+
| Group | 624.6 | 690.8 |
| revenue | | |
+---------------+-----------+--------------+
| Gross | 26.0 | 28.9 |
| profit | | |
| margin | | |
| (%) | | |
+---------------+-----------+--------------+
| Operating | (16.1) | 16.7 |
| (loss) / | | |
| profit | | |
| before | | |
| non-recurring | | |
| costs | | |
+---------------+-----------+--------------+
| Non-recurring | (2.7) | (3.7) |
| costs* | | |
+---------------+-----------+--------------+
| Operating | (18.8) | 13.0 |
| (loss) / | | |
| profit | | |
+---------------+-----------+--------------+
| (Loss) | (21.5) | 10.8 |
| / | | |
| profit | | |
| before | | |
| tax | | |
+---------------+-----------+--------------+
| (Loss) | (18.8) | 14.5 |
| / | | |
| profit | | |
| before | | |
| non-recurring | | |
| costs and tax | | |
+---------------+-----------+--------------+
| Basic | (4.44) | 2.23 |
| earnings | | |
| per | | |
| share | | |
| (pence) | | |
+---------------+-----------+--------------+
| Basic | (3.66) | 3.29 |
| earnings | | |
| per | | |
| share | | |
| before | | |
| non-recurring | | |
| costs (pence) | | |
+---------------+-----------+--------------+
| Interim | 1.88 | 1.88 |
| dividend | | |
| per | | |
| share | | |
| (pence) | | |
+---------------+-----------+--------------+
| Trading | 1,338 | 1,368 |
| store | | |
| numbers | | |
+---------------+-----------+--------------+
| Trading | 1,394 | 1,417 |
| square | | |
| footage | | |
| (sq ft | | |
| thousands) | | |
+---------------+-----------+--------------+
* Non-recurring costs relate to our restructuring in France and Australia
Financial summary:
· Group revenues down 9.6 per cent and like for like ('lfl') sales down by
10.9 per cent
· Gross margin down 290 basis points ('bps')
· First half loss of GBP18.8 million before non-recurring costs and tax
(2009: GBP14.5 million profit)
· Proposed Interim dividend of 1.88p
· Total sales in the 34 weeks ended 25 September 2010 down 9.3 per cent and
lfl sales down 10.0 per cent
Operational highlights
· Market share gains in all territories since January
· Continued closure of overlapping stores
· Leading preowned proposition
· Online business progressing well, with revenues up 2%
· Continued focus on costs
· Strong balance sheet with minimal gearing
Management Changes:
· Ian Shepherd joined the Group as CEO on 28 June 2010
Peter Lewis, Chairman, commented:
"Against the backdrop of a very challenging marketplace and an uncertain
economy, we have increased market share in all of our territories since January
and maintained our leading position in Europe.
As expected, we have returned to our traditional seasonal trading profile with
losses reported in the first half and all profits being made in the second half.
The Group has made a loss before tax and non-recurring costs of GBP18.8m in the
first half of the year, compared to a profit before tax and non-recurring costs
of GBP14.5m in the previous half year.
Whilst the Board remains mindful of the prevailing tough market conditions, we
believe that the Group is taking the right steps to position itself ahead of the
next pc and video games cycle. We will continue our focus on operational
efficiency, maintaining customer loyalty, and expanding our multi channel
proposition, while maximising market share on key product launches. We believe
that the profile of products launching in the second half should play well to
the specialist retailer and our business is ready to maximise these
opportunities."
Enquiries:
+----------------+-----------+
| The | +44 |
| GAME | (0)1256 |
| Group | 784566 |
| plc: | |
+----------------+-----------+
| Ian | |
| Shepherd, | |
| Chief | |
| Executive | |
+----------------+-----------+
| Ben | |
| White, | |
| Group | |
| Finance | |
| Director | |
+----------------+-----------+
| Simon | |
| Soffe, | |
| Investor | |
| Relations | |
| and Group | |
| Communications | |
| Director | |
+----------------+-----------+
| | |
+----------------+-----------+
| Brunswick: | +44 |
| | (0)20 |
| | 7404 5959 |
+----------------+-----------+
| Jonathan | |
| Glass, | |
| Oliver | |
| Hughes | |
+----------------+-----------+
CHAIRMAN'S REPORT
Summary
Against the backdrop of a very challenging marketplace and an uncertain economy,
we have increased market share in all of our territories since January and
maintained our leading position in Europe.
As expected, we have returned to our traditional seasonal trading profile with
losses reported in the first half and all profits being made in the second half.
The Group has made a loss before tax and non-recurring costs of GBP18.8m in the
first half of the year, compared to a profit before tax and non-recurring costs
of GBP14.5m in the previous half year.
This profile reflects the performance of the wider market. In the UK, market
revenues were down by 17.1%[1] and we have seen similar trends in other
territories. This has largely been driven by revenue declines from Nintendo
products, which enjoyed explosive growth in 2008 and 2009.
We have continued to take decisive action to remain operationally efficient,
through store and headcount rationalisation, and by creating a truly multi
channel offer through astute investment. In our under-performing international
markets of France and Australia, we have made changes to local management teams,
property portfolios and our commercial profile.
As a result, we are well positioned to benefit from the imminent launch of new
motion sensing technology and the extensive range of Christmas software
releases. An ongoing focus on the management of our operating costs and
development of our customer proposition will ensure we continue to be successful
when the market returns to growth.
Results
Group revenue for the 26 weeks ended 31 July 2010 decreased by 9.6% to GBP624.6m
(half year ended 31 July 2009: GBP690.8m) with lfl sales down by 10.9%. In the
UK and Ireland, total sales decreased by 17.8% and lfl sales were down by 16.2%.
In our International operations, total sales increased by 4.0% and lfl sales
fell by 3.1%. Our Online operations outperformed the rest of our business on a
like for like basis and sales increased by 2.0%.
Gross margin declined by 290 basis points reflecting our strategy to give
customers a more compelling value offer. This included high profile one-off
discount sales, which accounted for approximately 150 bps of the margin decline,
and enhanced promotions on new and preowned products.
The Group is exercising strict cost control disciplines and is on track to make
annual savings of GBP7m this year and GBP10m next year.
We are restructuring our businesses in France and Australia, resulting in
non-recurring costs of GBP2.7m in the half year. The full year non-recurring
costs to complete this restructuring are expected to be in the region of GBP10m
to GBP12m, of which approximately half will be a cash expense.
Reflecting the return to more traditional seasonal trading patterns, the Board
is maintaining the interim dividend at 1.88 pence per share (2009: 1.88 pence).
The Board intends to continue its progressive dividend policy for the full year,
balancing dividend yield against suitable dividend cover.
Our net debt position as at 31 July 2010 was GBP63.5m (2009: GBP80.2m). This
improvement in our cash position reflects disciplined working capital
management. In particular, we have cleared through the over-stocks noted in
April, reducing our stock position per store by 16% since the year end, and
tightened our stock cover profile.
Business Development
Our market
The market is undergoing a period of significant transition, with fewer hardware
and software launches in the year to date, and a decline in Nintendo Wii
revenues of over 40%. However, Microsoft Xbox and Sony PS3 have seen growth of
16% and 17% respectively[2], and innovative new products are performing well
when they come to market.
The July launch of the remodelled Microsoft Xbox 360 250GB was the principal
event in the year so far and GAME was Microsoft's lead European retail partner.
Sony has recently launched new models of the "Slim" PS3 and Nintendo is expected
to release the handheld 3DS in Europe next year. Initial reviews of this
technology have been very positive.
New motion sensing peripherals from Microsoft and Sony will extend the
functionality and appeal of their consoles, particularly when a full range of
new software titles becomes available next year. Playstation "Move" launched in
Europe on 17 September, and we look forward to seeing the growth in sales as we
head into Christmas. Microsoft's "Kinect" will launch in Europe on 10 November
and is generating good preorders.
The first half release schedule was dominated by core gamer titles such as Red
Dead Redemption and Battlefield Bad Company 2. GAME took a leading market
share on these products, reflecting the strength of our relationship with
suppliers, our core gamer appeal and customer recognition of the value of our
new release offer.
There is an extensive line-up of titles scheduled for release in the second
half. The first to come to market, Halo: Reach, has launched well and, again, we
were Microsoft's principal partner taking the leading market share. Forthcoming
releases include Assassin's Creed: Brotherhood, Call of Duty Black Ops, FIFA 11
and Medal of Honor.
Our evolution
Brand:
For every launch, the role of the specialist is crucial in giving customers
great value, a full range, ample availability, expert advice, in-store
demonstration and high profile launch theatre.
We have made good progress with the brand-enhancing initiatives we outlined in
April. One-off discount sales, combined with a series of new release
promotions, trade-in deals, preowned offers and own-brand product reinforces our
position as the leading specialist in the market.
Our preowned offer remains the most competitive and widespread on the high
street. Margins in preowned were down by 250 basis points as a result of the
value activity we drove on mint products and an increase of hardware in the
sales mix.
Offering exclusive products and limited editions gives customers a point of
difference and generates significant market shares for the Group. This is
continuing in the second half, with products including an exclusive Halo Reach
Xbox 360 console, and exclusive virtual weapons in Medal of Honor, which is
generating multiple pre-orders.
Due to our leading market position with the sale of Xbox Live cards, we are able
to capitalise on the release of digital content such as expansion packs.
Our 15 million GAME Reward cards have been instrumental to our success and we
are expanding our loyalty scheme further. An entirely new programme for
Gamestation customers, called the "Gamestation Elite" card, will also be
launched in October, offering customers points worth a 2.5% discount on their
purchases and trade-ins.
Operations:
Stores remain customers' preferred method of purchasing our products and our
outlets offer a wide range of hardware, peripherals, boxed software and digital
content backed up by specialist advice. We are trialling changes to the look
and feel of our stores, including more interactive product demonstrations and
additional products. The variety and complexity of products coming to market
will increase the need for specialist guidance. Our teams have received specific
additional training to help them give customers detailed, independent advice
about the new technology and games.
A new global IT platform is being introduced to link together our stores,
eCommerce sites, digital operations and loyalty programme. This will increase
the technical capability of our store teams and give customers a more
personalised experience. Since April, the technical infrastructure has been
built and tested and it will be introduced in stores from November 2010.
Our digital offer continues to expand. In the last two months we have introduced
a new download service for mobile phones and updated our services for pc
downloads and iPhone apps. We are trialling new services for casual and core
gamers and are monitoring consumer demand as these channels evolve. Digital
revenues are an important but small part of the overall market at about 4% of
total UK market sales[3].
UK
We remain the clear market leader in the UK, with 635 stores across two brands.
We will continue to manage our store portfolio with strict retail disciplines.
As announced in April, we have closed 15 owned stores and 27 concessions. Up to
70% of customers from these stores have transferred to another GAME store
following successful direct marketing campaigns. By Christmas 2013 we expect the
UK store portfolio to have been reduced to about 550 stores as we reduce store
over-lap and drive for greater cost efficiency.
We are focussed on having an efficient operating lease profile. To do this we
are lowering our average lease length, now five years across the Group compared
to 7 years two years ago, and through rent reviews and renegotiation we are
seeking year on year operating lease savings.
International
Internationally, we have opened five stores. All the new stores are located in
our Iberian and Czech divisions and are contributing to our growth and market
leadership in these territories.
In France, the new management team is making good progress with our plans to
return the business to profitability. We have seen some operational changes and
we will see a number of store closures.
In Australia, we continue to believe that we have a good challenger brand.
However we are making some significant changes to make sure we are the
specialist of choice for both suppliers and customers. This is resulting in
changes to the operating team, a rationalisation of the store portfolio and
moving the emphasis of the brand towards a value proposition.
In both markets, we have taken decisive action to improve performance and are
targeting a positive contribution in 2011.
Where we sell
+---------------+--------+--------+--------+---------+
| As at: | | 31 | 31 | 31 |
| | | July | July | January |
| | | 2010 | 2009 | 2010 |
+---------------+--------+--------+--------+---------+
| | | Number | Number | Number |
+---------------+--------+--------+--------+---------+
| Company | | | | |
| owned | | | | |
| and | | | | |
| concessions | | | | |
+---------------+--------+--------+--------+---------+
| UK and | | | | |
| Ireland | | 388 | 444 | 423 |
| - GAME | | 247 | 254 | 254 |
| - | | | | |
| Gamestation | | | | |
+---------------+--------+--------+--------+---------+
| Total | | 635 | 698 | 677 |
| UK and | | | | |
| Ireland | | | | |
+---------------+--------+--------+--------+---------+
| France | | 198 | 198 | 199 |
+---------------+--------+--------+--------+---------+
| Iberia | | 287 | 270 | 283 |
+---------------+--------+--------+--------+---------+
| Scandinavia | | 68 | 67 | 68 |
+---------------+--------+--------+--------+---------+
| Czech | | 31 | 21 | 29 |
| Republic | | | | |
+---------------+--------+--------+--------+---------+
| Total | | 584 | 556 | 579 |
| Continental | | | | |
| Europe | | | | |
+---------------+--------+--------+--------+---------+
| Australia | | 118 | 108 | 118 |
+---------------+--------+--------+--------+---------+
| Total | | 702 | 664 | 697 |
| International | | | | |
+---------------+--------+--------+--------+---------+
| Total | | 1,337 | 1,362 | 1,374 |
| owned | | | | |
| and | | | | |
| concessions | | | | |
+---------------+--------+--------+--------+---------+
| Franchises | | | | |
+---------------+--------+--------+--------+---------+
| Iberia | | - | 6 | 5 |
+---------------+--------+--------+--------+---------+
| Australia | | 1 | 1 | 1 |
+---------------+--------+--------+--------+---------+
| Total | | 1 | 6 | 6 |
| franchises | | | | |
+---------------+--------+--------+--------+---------+
| Total | | 1,338 | 1,368 | 1,380 |
| operational | | | | |
| outlets | | | | |
+---------------+--------+--------+--------+---------+
Treasury and Capital expenditure
In line with previous guidance, average net debt in the 2010/11 financial year
is anticipated to be around GBP60m (2009/10: GBP60m).
We anticipate that our total capital expenditure for the current year will be
around GBP20m (2009/10: GBP30m; 2008/09: GBP53m). We are investing GBP10m in
our global IT platform to combine our eCommerce, digital development and
information technology, GBP5m on the distribution centre and infrastructure and
the remainder on store openings and refurbishment. We have incurred GBP11m of
the total expenditure in the first half.
The Board and Management
I am delighted that Ian Shepherd joined the Group as Chief Executive in June.
He brings a range of skills which will strengthen our Board and he has not
hesitated in assessing the needs of our business and developing ideas for the
future, which he will communicate and implement in the coming months.
I would also like to thank Chris Bell for stepping in as Interim CEO in April
during the recruitment process. He has resumed his responsibilities as Senior
Non Executive Director.
Corporate Responsibility
The way we operate within our industry and our communities has a direct impact
on our reputation, brands and costs. Our CR strategy continues to evolve to
meet the needs and expectations of our customers, owners and other stakeholders
and we are making good progress. We have installed 450 automated 'smart' meters
in UK stores to help us manage and reduce our energy consumption, following
trials which showed a seven per cent reduction in stores' energy consumption. In
a bid to reduce our cost base and improve our carbon footprint further, we are
targeting suppliers who will provide 100% recycled packaging material in our UK
distribution function. Our teams have raised nearly GBP200,000 for Children's
Hospices UK. For further details, see www.gamegroup.plc.uk .
Current Trading and Outlook
In the 34 weeks ended 25 September 2010, total Group sales were down by 9.3%.
UK and Ireland total store sales were down by 16.7%, and International store
sales and total online sales were up by 2.9% and 2.7% respectively. For the same
period, Group lfl sales were down by 10.0%, with the UK and Ireland lfl sales
down by 14.8% and International lfl sales down by 3.2%. We are showing an
improving lfl trend as we move through the year.
Whilst the Board remains mindful of the prevailing tough market conditions, we
believe that the Group is taking the right steps to position itself ahead of the
next pc and video games cycle. We will continue our focus on operational
efficiency, maintaining customer loyalty, and expanding our multi channel
proposition, while maximising market share on key launches. We believe that the
profile of products launching in the second half should play well to the
specialist retailer and our business is ready to maximise these opportunities.
Peter Lewis
Chairman
Chief Executive's Review
In the short time I have been with GAME, my reasons for joining the business
have been strongly reaffirmed. There are few products which evoke the passion
and excitement of video games, and it's a great honour to join a team which is
so connected to customers and which excels at demonstrating and selling this
fast changing technology.
The Group has secured the leading position in Europe over the last two decades,
earning the loyalty of millions of customers and the partnership of key
suppliers. The Group has done this by being the industry specialist with a
resolute focus on customers; an approach I fully support. However, as our latest
results show, the market in which we operate is evolving and we must position
ourselves to be the partner of choice for customers and suppliers into the next
product cycle - whenever that may be.
When I listen to the questions raised by commentators on this industry and on
GAME specifically, I hear two main concerns about the future. At a
technological level, I hear debates about digital disintermediation, further
hardware cycles and the growing number of ways customers choose to interact with
games. At a competitor level, there is the perceived threat of the online
players to the retail community and the tactics of generalists in the market.
On the first of these issues, there is no doubt that there is going to be
evolution in the technology of our industry and in how consumers buy - it is
already visible in the market. It is, however easy to overstate the magnitude
and speed of that change - consumers still overwhelmingly prefer to buy video
games as physical boxed product and the view of our industry is that this is
likely to remain the case for some time. As Sony Computer Entertainment CEO Kaz
Hirai recently said "To think everything will be downloaded in two years, three
years or even ten years from now is taking it a little bit to the extreme."
However, even as we are cautious about the speed with which the "download
revolution" will happen, we must be bold in preparing for it. GAME has made
investments this year in a wide range of new technologies including mobile apps,
digital downloading on the web and even a presence directly in the "virtual
malls" on consoles themselves. Fundamentally, we believe that the strength of
our customer relationships and our brand position as an expert and trusted
retailer give us strength in those emerging channels and our investment in them
will continue.
On the second issue, that of others challenging our market position, I recognise
that there are strong competitors both on-line and on the high-street. The pc
and video games market is an attractive one, generating global revenues of about
$40bn, and interactive entertainment is a growing part of customers' leisure
time. I believe that to be successful in this industry a retailer must offer a
joined up brand proposition across every channel. Most importantly, that
proposition must exceed consumer demands for service, range and value. More
than in many other sectors, there is a significant place for the specialist
retailer in the video games market.
GAME is already a successful specialist retailer across the markets in which we
operate. However, to fully address the challenges we face, the business needs to
move forwards in a number of areas. Over the coming weeks and months we will be
implementing a strategy which amplifies our strengths. I will give more detail
in due course, but firmly believe that we can focus our efforts around specific
growth areas:
· building on our community of 15 million GAME Reward Card holders. This
customer database is an extraordinarily valuable asset giving us the opportunity
to market the right content to the right customer at the right time;
· growing our online offer and fully integrating it into our in-store
experiences. Our investment this year in creating a common underlying IT
platform linking stores and the web will deliver significant benefits to
customers and the business; and
· making sure we deliver our expertise and advice to customers at every
opportunity - showcasing and demonstrating new products and maintaining our
position as the partner of choice for the launch of new games and gaming
hardware.
In conjunction with the evolution of GAME's strategy, I also remain mindful of
the need for tight operational and commercial management. A relentless approach
to cost and cashflow management will remain a hallmark of the business.
Given the strategic importance of market position to customers and suppliers, we
have acted to hold or grow market share in all of our territories, even as the
market suffers significant lows compared to the last two years. As a result our
margins have been impacted by the delivery of a clear value message to
customers.
We have retained a Group-wide focus on sales, focusing on new product launches
to drive our market share and customer loyalty, with the result that lfl's have
improved in recent weeks.
We have taken early action to maintain the strength and stability of the
business. Operating costs have been reduced as a result of initiatives in our
head offices and store networks. New management teams in France and Australia
have developed action plans to return those businesses to positive contribution
next year.
We have made very good progress on working capital, ensuring future balance
sheet strength. We have been very selective with our capital investment
decisions, and we will continue to be good custodians of our owners' assets.
I am energised by the commitment of the team as we prepare for the peak trading
season, and the excitement of our customers as they look forward to the packed
schedule of new releases.
Ian Shepherd
Chief Executive
Statement of Directors' Responsibilities
The Directors confirm, to the best of their knowledge and belief, that this
condensed consolidated set of interim financial statements have been prepared in
accordance with IAS 34 as adopted by the European Union, and that the interim
management report herein includes a fair review of the information required by
the DTR 4.2.7 and DTR 4.2.8 namely:
· an indication of important events that have occurred during the six months
ended 31 July 2010 and their impact on the condensed consolidated financial
statements, and a description of the principal risks and uncertainties for the
remaining six months of the financial year; and
· material related party transactions in the six months ended 31 July 2010
and any material changes in the related party transactions described in the last
Annual Report.
A copy of the Company's 2010 Annual Report and Accounts is available on GAME's
website www.gamegroup.plc.uk.
By order of the Board
Ben White
Director
Unity House
Telford Road
Basingstoke
RG21 6YJ
28 September 2010
Unaudited Condensed Consolidated Statement of Comprehensive (Loss)/Income
for the six months ended 31 July 2010
+---------------+--------+-----------+------------+------------+
| | | Six | Six | Year |
| | | months | months | |
+---------------+--------+-----------+------------+------------+
| | | ended | ended | ended |
+---------------+--------+-----------+------------+------------+
| | | 31 | 31 | 31 |
| | | July | July | January |
+---------------+--------+-----------+------------+------------+
| | | 2010 | 2009 | 2010 |
+---------------+--------+-----------+------------+------------+
| | | Unaudited | Unaudited | Audited |
+---------------+--------+-----------+------------+------------+
| | Note | GBP'000 | GBP'000 | GBP'000 |
+---------------+--------+-----------+------------+------------+
| Revenue | 2 | 624,550 | 690,753 | 1,772,358 |
+---------------+--------+-----------+------------+------------+
| Cost | | 462,461 | 490,785 | 1,279,666 |
| of | | | | |
| sales | | | | |
+---------------+--------+-----------+------------+------------+
| Gross | | 162,089 | 199,968 | 492,692 |
| profit | | | | |
+---------------+--------+-----------+------------+------------+
| Other | 3 | 180,901 | 186,934 | 404,102 |
| operating | | | | |
| expenses | | | | |
+---------------+--------+-----------+------------+------------+
| | | | | |
+---------------+--------+-----------+------------+------------+
| Operating | | (16,106) | 16,718 | 94,789 |
| (loss) / | | | | |
| profit | | | | |
| before | | | | |
| non-recurring | | | | |
| costs | | | | |
+---------------+--------+-----------+------------+------------+
| Non-recurring | 3 | (2,706) | (3,684) | (6,199) |
| costs | | | | |
+---------------+--------+-----------+------------+------------+
| | | | | |
+---------------+--------+-----------+------------+------------+
| Operating | | (18,812) | 13,034 | 88,590 |
| (loss) / | | | | |
| profit | | | | |
+---------------+--------+-----------+------------+------------+
| Finance | | 161 | 133 | 538 |
| income | | | | |
+---------------+--------+-----------+------------+------------+
| Finance | | (2,822) | (2,393) | (4,917) |
| costs | | | | |
+---------------+--------+-----------+------------+------------+
| (Loss) | | (21,473) | 10,774 | 84,211 |
| / | | | | |
| Profit | | | | |
| before | | | | |
| taxation | | | | |
+---------------+--------+-----------+------------+------------+
| Taxation | 4 | 6,072 | (3,050) | (23,744) |
+---------------+--------+-----------+------------+------------+
| (Loss) | | (15,401) | 7,724 | 60,467 |
| / | | | | |
| Profit | | | | |
| for | | | | |
| the | | | | |
| year | | | | |
| attributable | | | | |
| to equity | | | | |
| holders of | | | | |
| the parent | | | | |
+---------------+--------+-----------+------------+------------+
| Other | | | | |
| comprehensive | | | | |
| income: | | | | |
+---------------+--------+-----------+------------+------------+
| Exchange | | (3,531) | (590) | 3,920 |
| differences | | | | |
| on | | | | |
| translating | | | | |
| foreign | | | | |
| operations | | | | |
+---------------+--------+-----------+------------+------------+
| Deferred | | - | - | (1,078) |
| income | | | | |
| tax on | | | | |
| share-based | | | | |
| payments | | | | |
+---------------+--------+-----------+------------+------------+
| Income | | - | - | 596 |
| tax on | | | | |
| share-based | | | | |
| payments | | | | |
+---------------+--------+-----------+------------+------------+
| Other | | (3,531) | (590) | 3,438 |
| comprehensive | | | | |
| (losses) / | | | | |
| income for | | | | |
| the period, | | | | |
| net of tax | | | | |
+---------------+--------+-----------+------------+------------+
| Total | | (18,932) | 7,134 | 63,905 |
| comprehensive | | | | |
| (loss) / | | | | |
| income for | | | | |
| the period | | | | |
| attributable | | | | |
| to equity | | | | |
| holders of | | | | |
| the parent | | | | |
+---------------+--------+-----------+------------+------------+
| Earnings | 6 | (4.44)p | 2.23p | 17.45p |
| per | | | | |
| share - | | | | |
| basic | | | | |
+---------------+--------+-----------+------------+------------+
| | 6 | | 2.23p | 17.42p |
| - | | (4.44)p | | |
| diluted | | | | |
+---------------+--------+-----------+------------+------------+
All amounts relate to continuing activities
Unaudited Condensed Consolidated Balance Sheet
as at 31 July 2010
+--------------+--------+-----------+-----------+----------+
| | | Six | Six | Year |
| | | months | months | |
+--------------+--------+-----------+-----------+----------+
| | | ended | ended | ended |
+--------------+--------+-----------+-----------+----------+
| | | 31 | 31 | 31 |
| | | July | July | January |
+--------------+--------+-----------+-----------+----------+
| | | 2010 | 2009 | 2010 |
+--------------+--------+-----------+-----------+----------+
| | | Unaudited | Unaudited | Audited |
+--------------+--------+-----------+-----------+----------+
| | Note | GBP'000 | GBP'000 | GBP'000 |
+--------------+--------+-----------+-----------+----------+
| Non-current | | | | |
| assets | | | | |
+--------------+--------+-----------+-----------+----------+
| Property, | 7 | 155,225 | 162,203 | 161,121 |
| plant and | | | | |
| equipment | | | | |
+--------------+--------+-----------+-----------+----------+
| Intangible | 8 | 178,682 | 181,422 | 180,135 |
| assets | | | | |
+--------------+--------+-----------+-----------+----------+
| Deferred | | 3,614 | 2,738 | 3,614 |
| tax | | | | |
| asset | | | | |
+--------------+--------+-----------+-----------+----------+
| | | 337,521 | 346,363 | 344,870 |
+--------------+--------+-----------+-----------+----------+
| Current | | | | |
| assets | | | | |
+--------------+--------+-----------+-----------+----------+
| Inventories | | 144,168 | 166,498 | 176,045 |
+--------------+--------+-----------+-----------+----------+
| Trade | 9 | 44,712 | 55,153 | 48,316 |
| and | | | | |
| other | | | | |
| receivables | | | | |
+--------------+--------+-----------+-----------+----------+
| Current | | 832 | - | - |
| tax | | | | |
| debtor | | | | |
+--------------+--------+-----------+-----------+----------+
| Cash | | 48,995 | 57,768 | 86,128 |
| and | | | | |
| cash | | | | |
| equivalents | | | | |
+--------------+--------+-----------+-----------+----------+
| | | 238,707 | 279,419 | 310,489 |
+--------------+--------+-----------+-----------+----------+
| Total | | 576,228 | 625,782 | 655,359 |
| assets | | | | |
+--------------+--------+-----------+-----------+----------+
| Current | | | | |
| liabilities | | | | |
+--------------+--------+-----------+-----------+----------+
| Trade | 10 | 156,897 | 192,416 | 258,203 |
| and | | | | |
| other | | | | |
| payables | | | | |
+--------------+--------+-----------+-----------+----------+
| Current | 11 | 96,784 | 104,328 | 17,361 |
| portion | | | | |
| of | | | | |
| long-term | | | | |
| borrowings | | | | |
+--------------+--------+-----------+-----------+----------+
| Leasehold | | 1,347 | 1,357 | 1,341 |
| property | | | | |
| incentives | | | | |
+--------------+--------+-----------+-----------+----------+
| Current | | - | 6,881 | 12,943 |
| tax | | | | |
| liabilities | | | | |
+--------------+--------+-----------+-----------+----------+
| | | 255,028 | 304,982 | 289,848 |
+--------------+--------+-----------+-----------+----------+
| Non-current | | | | |
| liabilities | | | | |
+--------------+--------+-----------+-----------+----------+
| Long-term | 11 | 15,714 | 33,626 | 23,908 |
| borrowings | | | | |
+--------------+--------+-----------+-----------+----------+
| Leasehold | | 10,246 | 7,614 | 10,048 |
| property | | | | |
| incentives | | | | |
+--------------+--------+-----------+-----------+----------+
| Deferred | | - | - | - |
| tax | | | | |
| liabilities | | | | |
+--------------+--------+-----------+-----------+----------+
| | | 25,960 | 41,240 | 33,956 |
+--------------+--------+-----------+-----------+----------+
| Total | | 280,988 | 346,222 | 323,804 |
| liabilities | | | | |
+--------------+--------+-----------+-----------+----------+
| Net | | 295,240 | 279,560 | 331,555 |
| assets | | | | |
+--------------+--------+-----------+-----------+----------+
| Equity | | | | |
| attributable | | | | |
| to equity | | | | |
| holders of | | | | |
| the parent | | | | |
+--------------+--------+-----------+-----------+----------+
| Share | 13 | 17,361 | 17,332 | 17,333 |
| capital | | | | |
+--------------+--------+-----------+-----------+----------+
| Share | 14 | 46,950 | 46,644 | 46,662 |
| premium | | | | |
| account | | | | |
+--------------+--------+-----------+-----------+----------+
| Capital | | 2,248 | 2,248 | 2,248 |
| redemption | | | | |
| reserve | | | | |
+--------------+--------+-----------+-----------+----------+
| Shares | | (4,199) | (3,168) | (3,395) |
| held | | | | |
| in | | | | |
| trust | | | | |
+--------------+--------+-----------+-----------+----------+
| Merger | | 76,907 | 76,907 | 76,907 |
| reserve | | | | |
+--------------+--------+-----------+-----------+----------+
| Foreign | | 23,843 | 22,864 | 27,374 |
| exchange | | | | |
| reserve | | | | |
+--------------+--------+-----------+-----------+----------+
| Retained | | 132,130 | 116,733 | 164,426 |
| earnings | | | | |
+--------------+--------+-----------+-----------+----------+
| Total | | 295,240 | 279,560 | 331,555 |
| equity | | | | |
+--------------+--------+-----------+-----------+----------+
Approved and authorised for issue by the Board on 28 September 2010
Ben White
Director
Unaudited Condensed Statement of Changes in Equity
for the six months ended 31 July 2010
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | Share | Share | Capital | Shares | Merger | Retained | Foreign | Total |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | Capital | Premium | Redemption | held | Reserve | Earnings | Exchange | |
| | | | | in | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | | | Reserve | Trust | | | Reserve | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| At 1 | 17,333 | 46,662 | 2,248 | (3,395) | 76,907 | 164,426 | 27,374 | 331,555 |
| February | | | | | | | | |
| 2010 | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Exchanges | - | - | - | - | - | - | (3,531) | (3,531) |
| differences | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| on | | | | | | | | |
| translation | | | | | | | | |
| of foreign | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| currency | | | | | | | | |
| net | | | | | | | | |
| investment | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| in | | | | | | | | |
| subsidiaries | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Income | | | | | | | | |
| tax on | | | | | | | | |
| share-based | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| payments | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | - | - | - |
| Deferred | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | - | - | - |
| Current | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| directly | - | - | - | - | - | - | (3,531) | (3,531) |
| in | | | | | | | | |
| equity | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| in | - | - | - | - | - | (15,401) | - | (15,401) |
| income | | | | | | | | |
| statement | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Total | | | | | | | | |
| recognised | | | | | | | | |
| income | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| and | - | - | - | - | - | (15,401) | (3,531) | (18,932) |
| expense | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Issue | 28 | 288 | - | - | - | - | - | 316 |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Purchase | - | - | - | (1,925) | - | - | - | (1,925) |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Exercise | - | - | - | 1,121 | - | (1,121) | - | - |
| of | | | | | | | | |
| options | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Dividends | - | - | - | - | - | (13,541) | - | (13,541) |
| paid | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Share-based | - | - | - | - | - | (2,233) | - | (2,233) |
| payments | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| At 31 | 17,361 | 46,950 | 2,248 | (4,199) | 76,907 | 132,130 | 23,843 | 295,240 |
| July | | | | | | | | |
| 2010 | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
Unaudited Condensed Statement of Changes in Equity
for the six months ended 31 July 2009
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | Share | Share | Capital | Shares | Merger | Retained | Foreign | Total |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | Capital | Premium | Redemption | held | Reserve | Earnings | Exchange | |
| | | | | in | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | | | Reserve | Trust | | | Reserve | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| At 1 | 17,316 | 46,462 | 2,248 | (6,451) | 76,907 | 130,472 | 23,454 | 290,408 |
| February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Restatement | - | - | - | - | - | (5,373) | - | (5,373) |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| At 1 | | | | | | | | |
| February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| after | 17,316 | 46,462 | 2,248 | (6,451) | 76,907 | 125,099 | 23,454 | 285,035 |
| restatement | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Exchanges | | | | | | | | |
| differences | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| on | | | | | | | | |
| translation | | | | | | | | |
| of foreign | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| currency | | | | | | | | |
| net | | | | | | | | |
| investment | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| in | - | - | - | - | - | - | (590) | (590) |
| subsidiaries | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Income | | | | | | | | |
| tax on | | | | | | | | |
| share-based | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| payments | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | - | - | - |
| Deferred | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | - | - | - |
| Current | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| directly | - | - | - | - | - | - | (590) | (590) |
| in | | | | | | | | |
| equity | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| in | - | - | - | - | - | 7,724 | - | 7,724 |
| income | | | | | | | | |
| statement | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Total | | | | | | | | |
| recognised | | | | | | | | |
| income | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| and | - | - | - | - | - | 7,724 | (590) | 7,134 |
| expense | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Issue | 16 | 182 | - | - | - | - | - | 198 |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Purchase | - | - | - | (1,254) | - | - | - | (1,254) |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Exercise | - | - | - | 4,537 | - | (4,537) | - | - |
| of | | | | | | | | |
| options | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Dividends | - | - | - | - | - | (12,849) | - | (12,849) |
| paid | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| Share-based | - | - | - | - | - | 1,296 | - | 1,296 |
| payments | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
| At 31 | 17,332 | 46,644 | 2,248 | (3,168) | 76,907 | 116,733 | 22,864 | 279,560 |
| July | | | | | | | | |
| 2009 | | | | | | | | |
+--------------+---------+---------+------------+---------+---------+----------+----------+----------+
Condensed Statement of Changes in Equity
for the year ended 31 January 2010
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| | Share | Share | Capital | Shares | Merger | Retained | Foreign | Total |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| | Capital | Premium | held | Reserve | Earnings | Exchange | |
| | | Redemption | in | | | | |
+--------------+---------+-------------------+---------+---------+----------+----------+----------+
| | | | Reserve | Trust | | | Reserve | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| At 1 | 17,316 | 46,462 | 2,248 | (6,451) | 76,907 | 126,365 | 23,454 | 286,301 |
| February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Exchanges | - | - | - | - | - | - | 3,920 | 3,920 |
| differences | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| on | | | | | | | | |
| translation | | | | | | | | |
| of foreign | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| currency | | | | | | | | |
| net | | | | | | | | |
| investment | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| in | | | | | | | | |
| subsidiaries | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Income | | | | | | | | |
| tax on | | | | | | | | |
| share-based | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| payments | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | (1,078) | - | (1,078) |
| Deferred | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| - | - | - | - | - | - | 596 | - | 596 |
| Current | | | | | | | | |
| tax | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| directly | - | - | - | - | - | (482) | 3,920 | 3,438 |
| in | | | | | | | | |
| equity | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Net | | | | | | | | |
| income | | | | | | | | |
| recognised | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| in | - | - | - | - | - | 60,467 | - | 60,467 |
| income | | | | | | | | |
| statement | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Total | | | | | | | | |
| recognised | | | | | | | | |
| income | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| and | - | - | - | - | - | 59,985 | 3,920 | 63,905 |
| expense | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Issue | 17 | 200 | - | - | - | - | - | 217 |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Purchase | - | - | - | (1,893) | - | - | - | (1,893) |
| of | | | | | | | | |
| shares | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Exercise | - | - | - | 4,949 | - | (4,949) | - | - |
| of | | | | | | | | |
| options | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Dividends | - | - | - | - | - | (19,366) | - | (19,366) |
| paid | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| Share-based | - | - | - | - | - | 2,391 | - | 2,391 |
| payments | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
| At 31 | 17,333 | 46,662 | 2,248 | (3,395) | 76,907 | 164,426 | 27,374 | 331,555 |
| January | | | | | | | | |
| 2010 | | | | | | | | |
+--------------+---------+---------+---------+---------+---------+----------+----------+----------+
Unaudited Condensed Consolidated Statements of Cash Flows
for the six months ended 31 July 2010
+----------------+--------+-----------+------------+-----------+
| | | Six | Six | Year |
| | | months | months | |
+----------------+--------+-----------+------------+-----------+
| | | Ended | ended | ended |
+----------------+--------+-----------+------------+-----------+
| | | 31 | 31 | 31 |
| | | July | July | January |
+----------------+--------+-----------+------------+-----------+
| | | 2010 | 2009 | 2010 |
+----------------+--------+-----------+------------+-----------+
| | | Unaudited | Unaudited | Audited |
+----------------+--------+-----------+------------+-----------+
| | Note | GBP'000 | GBP'000 | GBP'000 |
+----------------+--------+-----------+------------+-----------+
| Cash | | | | |
| flow | | | | |
| from | | | | |
| operating | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Operating | | (18,812) | 13,034 | 88,590 |
| (loss) / | | | | |
| profit | | | | |
+----------------+--------+-----------+------------+-----------+
| Equity-settled | | (2,233) | 1,296 | 2,391 |
| share-based | | | | |
| payment | | | | |
| expense | | | | |
+----------------+--------+-----------+------------+-----------+
| Depreciation | | 14,737 | 14,335 | 32,898 |
| and | | | | |
| amortisation | | | | |
+----------------+--------+-----------+------------+-----------+
| (Profit) | | (689) | 1,018 | 2,734 |
| / loss | | | | |
| on | | | | |
| disposal | | | | |
| of | | | | |
| non-current | | | | |
| assets | | | | |
+----------------+--------+-----------+------------+-----------+
| Market | | - | 205 | 81 |
| value | | | | |
| movement | | | | |
| on | | | | |
| financial | | | | |
| instrument | | | | |
+----------------+--------+-----------+------------+-----------+
| | | (6,997) | 29,888 | 126,694 |
+----------------+--------+-----------+------------+-----------+
| Decrease | | 3,604 | 312 | 6,869 |
| in trade | | | | |
| and | | | | |
| other | | | | |
| receivables | | | | |
+----------------+--------+-----------+------------+-----------+
| Decrease | | 31,878 | 15,467 | 7,220 |
| in | | | | |
| inventories | | | | |
+----------------+--------+-----------+------------+-----------+
| Decrease | | (102,334) | (154,959) | (87,860) |
| in trade | | | | |
| and | | | | |
| other | | | | |
| payables | | | | |
+----------------+--------+-----------+------------+-----------+
| Increase | | 204 | (261) | 1,757 |
| / | | | | |
| (decrease) | | | | |
| in | | | | |
| leasehold | | | | |
| incentives | | | | |
+----------------+--------+-----------+------------+-----------+
| Cash | | (73,645) | (109,553) | 54,680 |
| generated | | | | |
| from | | | | |
| operations | | | | |
+----------------+--------+-----------+------------+-----------+
| Finance | | (2,822) | (2,393) | (4,917) |
| costs | | | | |
| paid | | | | |
+----------------+--------+-----------+------------+-----------+
| Corporation | | (7,685) | (21,749) | (36,626) |
| tax paid | | | | |
+----------------+--------+-----------+------------+-----------+
| Net | | (84,152) | (133,695) | 13,137 |
| cash | | | | |
| from | | | | |
| operating | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Cash | | | | |
| flows | | | | |
| from | | | | |
| investing | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Purchase | | (8,578) | (11,863) | (26,322) |
| of | | | | |
| property, | | | | |
| plant and | | | | |
| equipment | | | | |
+----------------+--------+-----------+------------+-----------+
| Purchase | | (2,195) | (2,753) | (3,568) |
| of | | | | |
| intangible | | | | |
| assets | | | | |
+----------------+--------+-----------+------------+-----------+
| Proceeds | | 1,544 | 455 | 455 |
| from | | | | |
| sale of | | | | |
| equipment | | | | |
+----------------+--------+-----------+------------+-----------+
| Finance | | 161 | 133 | 538 |
| income | | | | |
| received | | | | |
+----------------+--------+-----------+------------+-----------+
| Net | | (9,068) | (14,028) | (28,897) |
| cash | | | | |
| used | | | | |
| in | | | | |
| investing | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Cash | | | | |
| flows | | | | |
| from | | | | |
| financing | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Proceeds | | 316 | 198 | 217 |
| from | | | | |
| issue of | | | | |
| share | | | | |
| capital | | | | |
+----------------+--------+-----------+------------+-----------+
| Shares | | (1,925) | (1,254) | (1,893) |
| purchased | | | | |
| for Trust | | | | |
+----------------+--------+-----------+------------+-----------+
| Payment | | (8,330) | (55,000) | (63,330) |
| of Term | | | | |
| Loan | | | | |
+----------------+--------+-----------+------------+-----------+
| Proceeds | | - | 50,000 | 50,000 |
| from | | | | |
| Term | | | | |
| Loan | | | | |
+----------------+--------+-----------+------------+-----------+
| Net | | 79,709 | 85,068 | (2,935) |
| receipt | | | | |
| /(payment) | | | | |
| of other | | | | |
| long-term | | | | |
| borrowings | | | | |
+----------------+--------+-----------+------------+-----------+
| Payment | | (142) | (286) | (419) |
| of | | | | |
| finance | | | | |
| lease | | | | |
| liabilities | | | | |
+----------------+--------+-----------+------------+-----------+
| Dividends | | (13,541) | (12,849) | (19,366) |
| paid | | | | |
+----------------+--------+-----------+------------+-----------+
| Net | | 56,087 | 65,877 | (37,726) |
| cash | | | | |
| used | | | | |
| in | | | | |
| financing | | | | |
| activities | | | | |
+----------------+--------+-----------+------------+-----------+
| Net | | (37,133) | (81,846) | (53,486) |
| decrease | | | | |
| in net | | | | |
| cash and | | | | |
| cash | | | | |
| equivalents | | | | |
+----------------+--------+-----------+------------+-----------+
| Cash | | 86,128 | 139,614 | 139,614 |
| and | | | | |
| cash | | | | |
| equivalents | | | | |
| at | | | | |
| beginning | | | | |
| of period | | | | |
+----------------+--------+-----------+------------+-----------+
| Cash | 12 | 48,995 | 57,768 | 86,128 |
| and | | | | |
| cash | | | | |
| equivalents | | | | |
| at end of | | | | |
| period | | | | |
+----------------+--------+-----------+------------+-----------+
| | | | | |
+----------------+--------+-----------+------------+-----------+
Interim Report 2010
Notes to the Interim Results
1 General
The GAME Group plc is a company incorporated, domiciled and registered in
England and Wales and is listed on the London Stock Exchange. The address of
its registered office is Unity House, Telford Road, Basingstoke, RG21 6YJ.
Basis of preparation
The financial information presented in this Interim Report has been prepared in
accordance with the accounting policies the Group expects to be applicable at 31
January 2011. The Interim Report has been prepared in accordance with those
IFRS and IFRIC interpretations issued and effective as at the time of preparing
the statement, and with the Disclosure and Transparency Rules of the Financial
Services Authority and with IAS 34, Interim Financial Reporting, as adopted by
the European Union. In line with this standard, the financial statements are
referred to as condensed.
The results for the six months ended 31 July 2010 and the comparative results
for the six months ended 31 July 2009 are unaudited. The financial information
for the year ended 31 January 2010 does not constitute the full statutory
accounts for that period. The Annual Report and Financial Statements for the
year ended 31 January 2010 have been filed with the Registrar of Companies. The
Independent Auditors' Report on the Annual Report and Financial Statements for
the year ended 31 January 2010 was unqualified, did not draw attention to any
matters by way of emphasis, and did not contain a statement under 498(2) or
498(3) of the Companies Act 2006.
Accounting policies
The accounting policies used in preparing the Interim Report are as set out in
the statutory accounts for the year ended 31 January 2010. There have been no
changes in accounting policies and accounting estimates.
Estimates and judgements
The preparation of financial statements in conformity with IFRS requires
management to make judgements, estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period.
Significant items subject to such assumptions and estimates include the useful
lives of assets, the measurement and recognition of provisions, the recognition
of deferred tax assets and liabilities for potential corporation tax. The most
critical accounting policies in determining the financial condition and results
of the Group are those requiring the greatest degree of subjective or complex
judgements. These relate to inventory valuation; lease costs; the valuation of
goodwill and acquired intangible assets; share-based payments and taxation. The
estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the judgements
about carrying values of assets and liabilities that are not readily apparent
from other sources. Actual results may differ from these estimates.
Adoption of new and revised standards
Standards and interpretations effective in the current period
In the
current period the Group has adopted the following standards:
+--------+--------------+------------+
| International | Effective |
| Accounting | Date |
| Standards | |
| (IAS/IFRS) | |
+-----------------------+------------+
| | | |
+--------+--------------+------------+
| | | |
+--------+--------------+------------+
| IAS 39 | Financial | |
| | Instruments: | |
| | Recognition | |
| | and | |
| | measurement: | |
| | Eligible | |
| | Hedged | |
+--------+--------------+------------+
| | Items | 01/07/2009 |
| | amendment | |
+--------+--------------+------------+
| IFRS 5 | Non-current | 01/01/2010 |
| | assets held | |
| | for sale | |
| | and | |
| | discontinued | |
| | operations | |
| | amendment | |
+--------+--------------+------------+
| IAS 7 | Statement | 01/01/2010 |
| | of cash | |
| | flows | |
| | amendment | |
+--------+--------------+------------+
| IAS 18 | Revenue | 01/01/2010 |
| | amendment | |
+--------+--------------+------------+
| IAS 32 | Financial | 01/02/2010 |
| | instruments: | |
| | presentation | |
| | amendment | |
+--------+--------------+------------+
| IAS 36 | Impairment | 01/01/2010 |
| | of assets | |
| | amendment | |
+--------+--------------+------------+
| IAS 38 | Intangible | 01/01/2010 |
| | assets | |
| | amendment | |
+--------+--------------+------------+
| IFRS 1 | Additional | 01/01/2010 |
| | exemptions | |
| | for First | |
| | Time | |
| | adopters | |
| | amendments | |
+--------+--------------+------------+
| IFRS 2 | Group | 01/01/2010 |
| | Cash-settled | |
| | Share-based | |
| | payment | |
| | Transactions | |
| | amendments | |
+--------+--------------+------------+
There has been no effect on the results, cash flows, financial position of the
Group or their presentation as a result of the adoption of these standards.
Five interpretations issued by the International Financial Reporting
Interpretations Committee are effective for the current period as follows:
+--------+---------------+------------+
| International | Effective |
| Financial | Date |
| Reporting | |
| Interpretations | |
| Committee | |
| (IFRIC) | |
+------------------------+------------+
| IFRIC | Hedges | 01/01/2009 |
| 16 | of a | |
| | Net | |
| | Investment | |
| | in a | |
| | Foreign | |
| | Operation | |
+--------+---------------+------------+
| IFRIC | Embedded | 30/06/2009 |
| 9 and | derivatives | |
| | amendments | |
+--------+---------------+------------+
| IAS 39 | | |
+--------+---------------+------------+
| IFRIC | Agreements | 01/01/2009 |
| 15 | for the | |
| | Construction | |
| | of Real | |
| | Estate | |
+--------+---------------+------------+
| IFRIC | Distributions | 01/07/2009 |
| 17 | of Non-cash | |
| | assets to | |
| | owners | |
+--------+---------------+------------+
| IFRIC | Transfers | 01/07/2009 |
| 18 | of assets | |
| | from | |
| | customers | |
+--------+---------------+------------+
The adoption of these Interpretations has not led to any changes in the Group's
accounting policies.
Standards and Interpretations in issue not yet adopted
The International Accounting Standards Board and the International Financial
Reporting Interpretations Committee have issued the following standards and
interpretations to be applied to financial statements with periods commencing on
or after the following dates:
+--------+--------------+------------+
| International | Effective |
| Accounting | Date |
| Standards | |
| (IAS/IFRS) | |
+-----------------------+------------+
| IFRS 1 | First-time | 01/07/2010 |
| | adoption | |
| | of IFRS | |
| | amendment | |
+--------+--------------+------------+
| IAS 24 | Related | 01/01/2011 |
| | Party | |
| | Disclosures | |
| | amendment | |
+--------+--------------+------------+
| IFRS | Financial | 01/01/2013 |
| 9* | Instruments | |
+--------+--------------+------------+
| | Improvements | Various |
| | to IFRSs* | |
+--------+--------------+------------+
+--------+---------------+------------+
| International | Effective |
| Financial | Date |
| Reporting | |
| Interpretations | |
| Committee | |
| (IFRIC) | |
+------------------------+------------+
| IFRIC | Extinguishing | 01/07/2010 |
| 19 | Financial | |
| | Liabilities | |
| | with Equity | |
| | Instruments | |
+--------+---------------+------------+
| IFRIC | The | |
| 14 and | limit | |
| | on a | |
| | defined | |
| | benefit | |
| | asset, | |
| | minimum | |
| | funding | |
| | requirements | |
+--------+---------------+------------+
| IAS 19 | | 01/01/2011 |
| | and | |
| | their | |
| | interaction | |
| | amendment | |
+--------+---------------+------------+
*These standards and interpretations are not endorsed by the EU at present.
The Directors do not anticipate that the adoption of these standards and
interpretations will have a material impact on the Group's financial statements
in the period of initial application.
2 Revenue, profit and net assets
Revenue, pre-tax profits and net assets all relate to the retail of pc and video
game products and the Group's operations are organised and managed by geographic
location only. Management consider the reportable operating segments in
accordance with IFRS 8 to be split between the UK and Ireland Stores,
International Stores, and Global Online. Management do not consider there to be
any major individual customers of the Group.
Revenue by origin and destination are not materially different. Inter-segment
transactions between operating segments are entered into on an arms-length basis
in a manner similar to transactions with third parties.
The Group's business is seasonal with the key trading period being the Christmas
season.
+---------------+-----------+---------------+----------+-----------+
| | United | | | |
| | Kingdom | | | |
+---------------+-----------+---------------+----------+-----------+
| | and | International | Global | Total |
| | Ireland | stores | | |
| | stores | | online | |
+---------------+-----------+---------------+----------+-----------+
| | Six | Six | Six | Six |
| | months | months | months | months |
| | ended | ended | ended | ended |
+---------------+-----------+---------------+----------+-----------+
| | 31 | 31 | 31 | 31 |
| | July | July | July | July |
| | 2010 | 2010 | 2010 | 2010 |
+---------------+-----------+---------------+----------+-----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------+-----------+---------------+----------+-----------+
| Revenue | 352,253 | 238,409 | 33,888 | 624,550 |
+---------------+-----------+---------------+----------+-----------+
| Cost | (254,538) | (177,855) | (30,068) | (462,461) |
| of | | | | |
| sales | | | | |
+---------------+-----------+---------------+----------+-----------+
| Gross | 97,715 | 60,554 | 3,820 | 162,089 |
| profit | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | | | | |
| operating | | | | |
| expenses | | | | |
| excluding | | | | |
+---------------+-----------+---------------+----------+-----------+
| inter-segment | (99,276) | (73,468) | (5,451) | (178,195) |
| expenses | | | | |
+---------------+-----------+---------------+----------+-----------+
| Inter-segment | - | - | - | - |
| expenses | | | | |
+---------------+-----------+---------------+----------+-----------+
| Operating | (1,561) | (12,914) | (1,631) | (16,106) |
| loss | | | | |
| before | | | | |
| non-recurring | | | | |
| costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Non-recurring | - | (2,706) | - | (2,706) |
| costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Operating | (1,561) | (15,620) | (1,631) | (18,812) |
| loss | | | | |
+---------------+-----------+---------------+----------+-----------+
| Net | (2,582) | (79) | - | (2,661) |
| finance | | | | |
| costs | | | | |
| excluding | | | | |
| inter-segment | | | | |
+---------------+-----------+---------------+----------+-----------+
| Inter-segment | 1,638 | (1,638) | - | - |
| finance costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Taxation | 3,112 | 2,613 | 347 | 6,072 |
+---------------+-----------+---------------+----------+-----------+
| Profit | 607 | (14,724) | (1,284) | (15,401) |
| / | | | | |
| (loss) | | | | |
| after | | | | |
| tax | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | | | | |
| segmental | | | | |
| information: | | | | |
+---------------+-----------+---------------+----------+-----------+
| Goodwill | 141,577 | 27,721 | 9,384 | 178,682 |
| and | | | | |
| other | | | | |
| intangibles | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | 133,174 | 251,633 | 12,739 | 397,546 |
| assets | | | | |
+---------------+-----------+---------------+----------+-----------+
| Assets | 274,751 | 279,354 | 22,123 | 576,228 |
+---------------+-----------+---------------+----------+-----------+
| Liabilities | (96,564) | (173,814) | (10,610) | (280,988) |
+---------------+-----------+---------------+----------+-----------+
| Net | 178,187 | 105,540 | 11,513 | 295,240 |
| assets | | | | |
+---------------+-----------+---------------+----------+-----------+
| Capital | 1,260 | 3,074 | 6,439 | 10,773 |
| expenditure | | | | |
+---------------+-----------+---------------+----------+-----------+
| Depreciation | 8,010 | 5,389 | 1,338 | 14,737 |
| and | | | | |
| amortisation | | | | |
+---------------+-----------+---------------+----------+-----------+
| Share-based | (2,233) | - | - | (2,233) |
| (income) / | | | | |
| payment | | | | |
| expense | | | | |
+---------------+-----------+---------------+----------+-----------+
+---------------+-----------+---------------+----------+-----------+
| | United | | | |
| | Kingdom | | | |
+---------------+-----------+---------------+----------+-----------+
| | and | International | Global | Total |
| | Ireland | stores | | |
| | stores | | online | |
+---------------+-----------+---------------+----------+-----------+
| | Six | Six | Six | Six |
| | months | months | months | months |
| | ended | ended | ended | ended |
+---------------+-----------+---------------+----------+-----------+
| | 31 | 31 | 31 | 31 |
| | July | July | July | July |
| | 2009 | 2009 | 2009 | 2009 |
+---------------+-----------+---------------+----------+-----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------+-----------+---------------+----------+-----------+
| Revenue | 428,307 | 229,236 | 33,210 | 690,753 |
+---------------+-----------+---------------+----------+-----------+
| Cost | (293,332) | (170,395) | (27,058) | (490,785) |
| of | | | | |
| sales | | | | |
+---------------+-----------+---------------+----------+-----------+
| Gross | 134,975 | 58,841 | 6,152 | 199,968 |
| profit | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | | | | |
| operating | | | | |
| expenses | | | | |
| excluding | | | | |
+---------------+-----------+---------------+----------+-----------+
| inter-segment | (109,945) | (68,738) | (4,567) | (183,250) |
| expenses | | | | |
+---------------+-----------+---------------+----------+-----------+
| Inter-segment | - | - | - | - |
| expenses | | | | |
+---------------+-----------+---------------+----------+-----------+
| Operating | 25,030 | (9,897) | 1,585 | 16,718 |
| profit / | | | | |
| (loss) | | | | |
| before | | | | |
| non-recurring | | | | |
| costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Non-recurring | (3,684) | - | - | (3,684) |
| costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Operating | 21,346 | (9,897) | 1,585 | 13,034 |
| profit / | | | | |
| (loss) | | | | |
+---------------+-----------+---------------+----------+-----------+
| Net | (2,255) | (5) | - | (2,260) |
| finance | | | | |
| costs | | | | |
| excluding | | | | |
| inter-segment | | | | |
+---------------+-----------+---------------+----------+-----------+
| Inter-segment | 1,393 | (1,393) | - | - |
| finance costs | | | | |
+---------------+-----------+---------------+----------+-----------+
| Taxation | (2,344) | (706) | - | (3,050) |
+---------------+-----------+---------------+----------+-----------+
| Profit | 18,140 | (12,001) | 1,585 | 7,724 |
| / | | | | |
| (loss) | | | | |
| after | | | | |
| tax | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | | | | |
| segmental | | | | |
| information: | | | | |
+---------------+-----------+---------------+----------+-----------+
| Goodwill | 153,680 | 27,026 | 716 | 181,422 |
| and | | | | |
| other | | | | |
| intangibles | | | | |
+---------------+-----------+---------------+----------+-----------+
| Other | 199,382 | 232,405 | 12,573 | 444,360 |
| assets | | | | |
+---------------+-----------+---------------+----------+-----------+
| Assets | 353,062 | 259,431 | 13,289 | 625,782 |
+---------------+-----------+---------------+----------+-----------+
| Liabilities | (137,252) | (199,398) | (9,572) | (346,222) |
+---------------+-----------+---------------+----------+-----------+
| Net | 215,810 | 60,033 | 3,717 | 279,560 |
| assets | | | | |
+---------------+-----------+---------------+----------+-----------+
| Capital | 5,559 | 7,934 | 1,123 | 14,616 |
| expenditure | | | | |
+---------------+-----------+---------------+----------+-----------+
| Depreciation | 7,345 | 5,974 | 1,016 | 14,335 |
| and | | | | |
| amortisation | | | | |
+---------------+-----------+---------------+----------+-----------+
| Share-based | 1,296 | - | - | 1,296 |
| payment | | | | |
| expense | | | | |
+---------------+-----------+---------------+----------+-----------+
+---------------+-----------+---------------+----------+-------------+
| | United | | | |
| | Kingdom | | | |
+---------------+-----------+---------------+----------+-------------+
| | and | International | Global | Total |
| | Ireland | stores | online | |
| | stores | | | |
+---------------+-----------+---------------+----------+-------------+
| | Year | Year | Year | Year |
| | ended | ended | ended | ended |
+---------------+-----------+---------------+----------+-------------+
| | 31 | 31 | 31 | 31 |
| | January | January | January | January |
| | 2010 | 2010 | 2010 | 2010 |
+---------------+-----------+---------------+----------+-------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------+-----------+---------------+----------+-------------+
| Revenue | 1,072,698 | 602,556 | 97,104 | 1,772,358 |
+---------------+-----------+---------------+----------+-------------+
| Cost | (751,296) | (447,373) | (80,997) | (1,279,666) |
| of | | | | |
| sales | | | | |
+---------------+-----------+---------------+----------+-------------+
| Gross | 321,402 | 155,183 | 16,107 | 492,692 |
| profit | | | | |
+---------------+-----------+---------------+----------+-------------+
| Other | | | | |
| operating | | | | |
| expenses | | | | |
| excluding | | | | |
+---------------+-----------+---------------+----------+-------------+
| inter-segment | (240,044) | (146,633) | (11,226) | (397,903) |
| expenses | | | | |
+---------------+-----------+---------------+----------+-------------+
| Inter-segment | 3,331 | (3,331) | - | - |
| expenses | | | | |
+---------------+-----------+---------------+----------+-------------+
| Operating | 84,689 | 5,219 | 4,881 | 94,789 |
| profit | | | | |
| before | | | | |
| non-recurring | | | | |
| costs | | | | |
+---------------+-----------+---------------+----------+-------------+
| Non-recurring | (6,199) | - | - | (6,199) |
| costs | | | | |
+---------------+-----------+---------------+----------+-------------+
| Operating | 78,490 | 5,219 | 4,881 | 88,590 |
| profit | | | | |
+---------------+-----------+---------------+----------+-------------+
| Net | (4,184) | (195) | - | (4,379) |
| finance | | | | |
| costs | | | | |
| excluding | | | | |
| inter-segment | | | | |
+---------------+-----------+---------------+----------+-------------+
| Inter-segment | 2,544 | (2,544) | - | - |
| finance costs | | | | |
+---------------+-----------+---------------+----------+-------------+
| Taxation | (20,321) | (3,423) | - | (23,744) |
+---------------+-----------+---------------+----------+-------------+
| Profit | 56,529 | (943) | 4,881 | 60,467 |
| after | | | | |
| tax | | | | |
+---------------+-----------+---------------+----------+-------------+
| Other | | | | |
| segmental | | | | |
| information: | | | | |
+---------------+-----------+---------------+----------+-------------+
| Goodwill | 153,649 | 25,974 | 512 | 180,135 |
| and | | | | |
| other | | | | |
| intangibles | | | | |
+---------------+-----------+---------------+----------+-------------+
| Other | 212,043 | 253,185 | 9,996 | 475,224 |
| assets | | | | |
+---------------+-----------+---------------+----------+-------------+
| Assets | 365,692 | 279,159 | 10,508 | 655,359 |
+---------------+-----------+---------------+----------+-------------+
| Liabilities | (166,077) | (149,524) | (8,203) | (323,804) |
+---------------+-----------+---------------+----------+-------------+
| Net | 199,615 | 129,635 | 2,305 | 331,555 |
| assets | | | | |
+---------------+-----------+---------------+----------+-------------+
| Capital | 11,013 | 14,333 | 4,544 | 29,890 |
| expenditure | | | | |
+---------------+-----------+---------------+----------+-------------+
| Depreciation | 15,908 | 14,751 | 2,239 | 32,898 |
| and | | | | |
| amortisation | | | | |
+---------------+-----------+---------------+----------+-------------+
| Share-based | 2,391 | - | - | 2,391 |
| payment | | | | |
| expense | | | | |
+---------------+-----------+---------------+----------+-------------+
+----------+--------+----------+--------+--------+----------+--------+
| | | Six | | | Six | |
| | | months | | | months | |
+----------+--------+----------+--------+--------+----------+--------+
| | | ended | | | ended | |
+----------+--------+----------+--------+--------+----------+--------+
| | | 31 | | | 31 | |
| | | July | | | July | |
+----------+--------+----------+--------+--------+----------+--------+
| | | 2010 | | | 2009 | |
+----------+--------+----------+--------+--------+----------+--------+
| | | Total | | | Total | |
+----------+--------+----------+--------+--------+----------+--------+
| | | GBP'000 | % of | | GBP'000 | % of |
| | | | Total | | | Total |
+----------+--------+----------+--------+--------+----------+--------+
| Revenue | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| Hardware | | 115,830 | 18.5 | | 146,657 | 21.2 |
+----------+--------+----------+--------+--------+----------+--------+
| Software | | 249,070 | 39.9 | | 282,829 | 40.9 |
+----------+--------+----------+--------+--------+----------+--------+
| New | | 364,900 | 58.4 | | 429,486 | 62.1 |
| hardware | | | | | | |
| and | | | | | | |
| software | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| Preowned | | 171,497 | 27.5 | | 177,268 | 25.7 |
+----------+--------+----------+--------+--------+----------+--------+
| Other | | 88,153 | 14.1 | | 83,999 | 12.2 |
+----------+--------+----------+--------+--------+----------+--------+
| Total | | 624,550 | 100.0 | | 690,753 | 100.0 |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | Six | | | Six | |
| | | months | | | months | |
+----------+--------+----------+--------+--------+----------+--------+
| | | Ended | | | ended | |
+----------+--------+----------+--------+--------+----------+--------+
| | | 31 | | | 31 | |
| | | July | | | July | |
+----------+--------+----------+--------+--------+----------+--------+
| | | 2010 | | | 2009 | |
+----------+--------+----------+--------+--------+----------+--------+
| | | Total | | | Total | |
+----------+--------+----------+--------+--------+----------+--------+
| | | GBP'000 | % of | | GBP'000 | % of |
| | | | Total | | | Total |
+----------+--------+----------+--------+--------+----------+--------+
| Gross | | | | | | |
| margin | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| New | | 70,813 | 43.7 | | 102,459 | 51.2 |
| hardware | | | | | | |
| and | | | | | | |
| software | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| Preowned | | 66,100 | 40.8 | | 72,664 | 36.3 |
+----------+--------+----------+--------+--------+----------+--------+
| Other | | 25,176 | 15.5 | | 24,845 | 12.5 |
+----------+--------+----------+--------+--------+----------+--------+
| Total | | 162,089 | 100.0 | | 199,968 | 100.0 |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | Six | Six |
| | | | | | months | months |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | ended | ended |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | 31 | 31 |
| | | | | | July | July |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | 2010 | 2009 |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | Total | Total |
+----------+--------+----------+--------+--------+----------+--------+
| | | | | | % | % |
+----------+--------+----------+--------+--------+----------+--------+
| Gross | | | | | | |
| margin | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| New | | | | | 19.4 | 23.9 |
| hardware | | | | | | |
| and | | | | | | |
| software | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
| Preowned | | | | | 38.5 | 41.0 |
+----------+--------+----------+--------+--------+----------+--------+
| Other | | | | | 28.6 | 29.6 |
+----------+--------+----------+--------+--------+----------+--------+
| Total | | | | | 26.0 | 28.9 |
| Group | | | | | | |
+----------+--------+----------+--------+--------+----------+--------+
+-------------+------------+------------+------------+
| | Six | Six | Year |
| | months | months | |
+-------------+------------+------------+------------+
| | ended | ended | ended |
+-------------+------------+------------+------------+
| | 31 | 31 | 31 |
| | July | July | January |
+-------------+------------+------------+------------+
| | 2010 | 2009 | 2010 |
+-------------+------------+------------+------------+
| | Unaudited | Unaudited | Audited |
+-------------+------------+------------+------------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+------------+------------+------------+
| Revenue | | | |
| by | | | |
| territory | | | |
+-------------+------------+------------+------------+
| United | 352,253 | 428,307 | 1,072,698 |
| Kingdom | | | |
| and | | | |
| Ireland | | | |
+-------------+------------+------------+------------+
| France | 65,259 | 76,938 | 187,291 |
| | | | |
+-------------+------------+------------+------------+
| Iberia | 115,092 | 105,836 | 288,342 |
| | | | |
+-------------+------------+------------+------------+
| Scandinavia | 21,786 | 19,501 | 49,962 |
| | | | |
+-------------+------------+------------+------------+
| Australia | 32,861 | 24,460 | 69,705 |
| | | | |
+-------------+------------+------------+------------+
| Czech | 3,411 | 2,501 | 7,256 |
| Republic | | | |
+-------------+------------+------------+------------+
| Total | 590,662 | 657,543 | 1,675,254 |
| Stores | | | |
+-------------+------------+------------+------------+
| Total | 33,888 | 33,210 | 97,104 |
| Online | | | |
+-------------+------------+------------+------------+
| Total | 624,550 | 690,753 | 1,772,358 |
| Revenue | | | |
+-------------+------------+------------+------------+
| | Number | Number | Number |
+-------------+------------+------------+------------+
| Stores | | | |
| by | | | |
| territory | | | |
+-------------+------------+------------+------------+
| United | 635 | 698 | 677 |
| Kingdom | | | |
| and | | | |
| Ireland | | | |
+-------------+------------+------------+------------+
| France | 198 | 198 | 199 |
| | | | |
+-------------+------------+------------+------------+
| Iberia | 287 | 270 | 283 |
| | | | |
+-------------+------------+------------+------------+
| Scandinavia | 68 | 67 | 68 |
| | | | |
+-------------+------------+------------+------------+
| Australia | 118 | 108 | 118 |
| | | | |
+-------------+------------+------------+------------+
| Czech | 31 | 21 | 29 |
| Republic | | | |
+-------------+------------+------------+------------+
| | 1,337 | 1,362 | 1,374 |
+-------------+------------+------------+------------+
| Franchises | | | |
+-------------+------------+------------+------------+
| Iberia | - | 5 | 5 |
| | | | |
+-------------+------------+------------+------------+
| Australia | 1 | 1 | 1 |
| | | | |
+-------------+------------+------------+------------+
| | 1 | 6 | 6 |
+-------------+------------+------------+------------+
| | Sq ft | Sq ft | Sq ft |
+-------------+------------+------------+------------+
| Trading | | | |
| square | | | |
| footage | | | |
| by | | | |
| territory | | | |
+-------------+------------+------------+------------+
| United | 756,292 | 812,325 | 797,594 |
| Kingdom | | | |
| and | | | |
| Ireland | | | |
+-------------+------------+------------+------------+
| France | 183,622 | 181,621 | 185,172 |
| | | | |
+-------------+------------+------------+------------+
| Iberia | 236,988 | 225,690 | 236,045 |
| | | | |
+-------------+------------+------------+------------+
| Scandinavia | 69,575 | 63,906 | 69,575 |
| | | | |
+-------------+------------+------------+------------+
| Australia | 129,304 | 121,153 | 132,564 |
| | | | |
+-------------+------------+------------+------------+
| Czech | 18,494 | 12,342 | 17,483 |
| Republic | | | |
+-------------+------------+------------+------------+
| | 1,394,275 | 1,417,037 | 1,438,433 |
+-------------+------------+------------+------------+
| | | | |
+-------------+------------+------------+------------+
3 Other operating expenses
+----------------+-----------+-----------+---------+
| | Six | Six | Year |
| | months | months | |
+----------------+-----------+-----------+---------+
| | ended | ended | ended |
+----------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+----------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+----------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+----------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------+-----------+-----------+---------+
| Selling | 156,306 | 156,940 | 324,198 |
| and | | | |
| distribution | | | |
+----------------+-----------+-----------+---------+
| Administrative | 24,595 | 29,994 | 79,904 |
| expenses | | | |
+----------------+-----------+-----------+---------+
| | 180,901 | 186,934 | 404,102 |
+----------------+-----------+-----------+---------+
Administrative expenses include non-recurring costs of GBP2,706,251 (2009
interim: GBP3,684,383; full year GBP6,199,486). Current year non-recurring
costs relate to the restructuring of the Australian and French businesses.
Prior year interim and full year non-recurring costs were in relation to
integration costs following the acquisition of Gamestation.
4 Taxation
The UK corporation tax charge has been included at an underlying corporation tax
rates in line with the previous year
+-------------+-----------+-----------+---------+
| | Six | Six | Year |
| | months | months | |
+-------------+-----------+-----------+---------+
| | ended | ended | ended |
+-------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+-------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+-------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+-------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+-----------+-----------+---------+
| Current | | | |
| tax | | | |
+-------------+-----------+-----------+---------+
| UK | (7,249) | 2,344 | 22,192 |
| corporation | | | |
| tax | | | |
| (credit) / | | | |
| expense | | | |
+-------------+-----------+-----------+---------+
| Adjustments | - | - | (1,950) |
| in respect | | | |
| of prior | | | |
| periods | | | |
+-------------+-----------+-----------+---------+
| Overseas | 1,177 | 706 | 4,192 |
| tax | | | |
| payable | | | |
+-------------+-----------+-----------+---------+
| Total | (6,072) | 3,050 | 24,434 |
| current | | | |
| tax | | | |
+-------------+-----------+-----------+---------+
| Deferred | | | |
| tax | | | |
+-------------+-----------+-----------+---------+
| Current | - | - | (1,695) |
| year | | | |
| movement | | | |
+-------------+-----------+-----------+---------+
| Prior | - | - | 1,005 |
| year | | | |
| movement | | | |
+-------------+-----------+-----------+---------+
| Taxation | (6,072) | 3,050 | 23,744 |
| on | | | |
| profit | | | |
| on | | | |
| ordinary | | | |
| activities | | | |
+-------------+-----------+-----------+---------+
+---------------+------------+-----------+------------+------------+-----------+------------+
| | Six months ended 31 July | Six months ended 31 July |
| | 2010 | 2009 |
+---------------+-------------------------------------+-------------------------------------+
| | Unaudited | Unaudited |
+---------------+-------------------------------------+-------------------------------------+
| | | Tax | | | Tax | |
+---------------+------------+-----------+------------+------------+-----------+------------+
| | Before-tax | (expense) | Net-of-tax | Before-tax | (expense) | Net-of-tax |
+---------------+------------+-----------+------------+------------+-----------+------------+
| | amount | benefit | amount | amount | benefit | amount |
+---------------+------------+-----------+------------+------------+-----------+------------+
| Exchange | | | | | | |
| differences | | | | | | |
| on | | | | | | |
+---------------+------------+-----------+------------+------------+-----------+------------+
| translating | (3,531) | | (3,531) | (590) | - | (590) |
| foreign | | | | | | |
| operations | | | | | | |
+---------------+------------+-----------+------------+------------+-----------+------------+
| Gains | - | - | - | - | - | - |
| on | | | | | | |
| property | | | | | | |
| revaluation | | | | | | |
+---------------+------------+-----------+------------+------------+-----------+------------+
| Other | (3,531) | | (3,531) | (590) | - | (590) |
| comprehensive | | | | | | |
| income | | | | | | |
+---------------+------------+-----------+------------+------------+-----------+------------+
5 Dividends
+-----------+-----------+-----------+---------+
| | Six | Six | Year |
| | months | months | |
+-----------+-----------+-----------+---------+
| | ended | ended | ended |
+-----------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+-----------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+-----------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+-----------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-----------+-----------+-----------+---------+
| Ordinary | | | |
| dividends | | | |
+-----------+-----------+-----------+---------+
| Final | 13,541 | 12,849 | 12,849 |
| paid | | | |
+-----------+-----------+-----------+---------+
| Interim | - | - | 6,517 |
| paid | | | |
+-----------+-----------+-----------+---------+
| | 13,541 | 12,849 | 19,366 |
+-----------+-----------+-----------+---------+
The interim dividend in relation to the period ended 31 July 2010 was declared
on 28 September 2010 and is payable on 18 November 2010 to shareholders on the
register on 22 October 2010. This dividend is therefore not included in the
above.
6 Earnings per share
The calculation of earnings per share for the six months ended 31 July 2010 is
based on the loss after taxation of GBP15,400,763 (2009 interim: profit
GBP7,724,000; full year profit GBP60,467,009). The calculation of basic earnings
per share is based on a weighted average number of shares in issue during the
period of 346,899,493 (2009 interim: 346,369,840; full year: 346,512,537). The
number of shares used in these calculations and the reconciliation of
denominators used for basic and diluted earnings per share calculations is set
out in the table below:
+---------+-------------+---------+-------------+
| | | | |
+---------+-------------+---------+-------------+
| | | Effect | |
| | | of | |
+---------+-------------+---------+-------------+
| | Basic | share | Diluted |
| | | options | |
+---------+-------------+---------+-------------+
| 31 | 346,899,493 | 156,558 | 347,056,051 |
| July | | | |
| 2010 | | | |
+---------+-------------+---------+-------------+
| 31 | 346,369,840 | 743,585 | 347,113,425 |
| July | | | |
| 2009 | | | |
+---------+-------------+---------+-------------+
| 31 | 346,512,537 | 677,327 | 347,189,864 |
| January | | | |
| 2010 | | | |
+---------+-------------+---------+-------------+
Additional disclosure has been provided in respect of earnings per share before
non-recurring costs as the directors believe this gives a better view of ongoing
maintainable earnings in the prior year.
+---------------+-----------+-----------+---------+
| | As at | As at | As at |
+---------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+---------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+---------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+---------------+-----------+-----------+---------+
| | Pence | Pence | Pence |
+---------------+-----------+-----------+---------+
| Basic | (4.44) | 2.23 | 17.45 |
| (loss) | | | |
| / | | | |
| earnings | | | |
| per | | | |
| share | | | |
+---------------+-----------+-----------+---------+
| Non-recurring | 0.78 | 1.06 | 1.79 |
| costs per | | | |
| share | | | |
+---------------+-----------+-----------+---------+
| Basic | (3.66) | 3.29 | 19.24 |
| (loss) | (4.44) | 2.23 | 17.42 |
| / | | | |
| earnings | | | |
| per | | | |
| share | | | |
| before | | | |
| non-recurring | | | |
| costs | | | |
| Diluted | | | |
| (loss) / | | | |
| earnings per | | | |
| share | | | |
+---------------+-----------+-----------+---------+
There are 653,297 anti-dilutive share options in the current period (2009
interim: nil; full year 648,948).
7 Property, plant and equipment
+--------------+-----------+-----------+----------+
| | As at | As at | As at |
+--------------+-----------+-----------+----------+
| | 31 | 31 | 31 |
| | July | July | January |
+--------------+-----------+-----------+----------+
| | 2010 | 2009 | 2010 |
+--------------+-----------+-----------+----------+
| | Unaudited | Unaudited | Audited |
+--------------+-----------+-----------+----------+
| | GBP'000 | GBP'000 | GBP'000 |
+--------------+-----------+-----------+----------+
| Cost | | | |
+--------------+-----------+-----------+----------+
| Balance | 299,168 | 279,744 | 279,744 |
| brought | | | |
| forward | | | |
+--------------+-----------+-----------+----------+
| Additions | 8,578 | 11,863 | 26,322 |
+--------------+-----------+-----------+----------+
| Disposals | (2,784) | (2,725) | (7,018) |
+--------------+-----------+-----------+----------+
| Foreign | (2,865) | (3,303) | 120 |
| exchange | | | |
| adjustment | | | |
+--------------+-----------+-----------+----------+
| Balance | 302,097 | 285,579 | 299,168 |
| carried | | | |
| forward | | | |
+--------------+-----------+-----------+----------+
| Depreciation | | | |
+--------------+-----------+-----------+----------+
| Balance | 138,047 | 114,135 | 114,135 |
| brought | | | |
| forward | | | |
+--------------+-----------+-----------+----------+
| Charge | 11,578 | 11,229 | 28,593 |
| for | | | |
| the | | | |
| period | | | |
+--------------+-----------+-----------+----------+
| Disposals | (1,929) | (1,130) | (4,633) |
+--------------+-----------+-----------+----------+
| Foreign | (824) | (858) | (48) |
| exchange | | | |
| adjustment | | | |
+--------------+-----------+-----------+----------+
| Balance | 146,872 | 123,376 | 138,047 |
| carried | | | |
| forward | | | |
+--------------+-----------+-----------+----------+
| Carrying | 155,225 | 162,203 | 161,121 |
| amount | | | |
+--------------+-----------+-----------+----------+
8 Intangible fixed assets
+-----------------------+-----------+-----------+---------+
| | As at | As at | As at |
+-----------------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+-----------------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+-----------------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+-----------------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-----------------------+-----------+-----------+---------+
| Cost | | | |
+-----------------------+-----------+-----------+---------+
| Balance | 192,046 | 192,436 | 192,436 |
| brought | | | |
| forward | | | |
+-----------------------+-----------+-----------+---------+
| Additions | 2,195 | 2,753 | 3,568 |
+-----------------------+-----------+-----------+---------+
| Disposals | (1) | (281) | (2,460) |
+-----------------------+-----------+-----------+---------+
| Foreign | (480) | (626) | (533) |
| exchange | | | |
| adjustment | | | |
+-----------------------+-----------+-----------+---------+
| Balance | 193,760 | 194,282 | 193,011 |
| carried | | | |
| forward | | | |
+-----------------------+-----------+-----------+---------+
| Depreciation | | | |
+-----------------------+-----------+-----------+---------+
| Balance | 11,911 | 10,169 | 10,169 |
| brought | | | |
| forward | | | |
+-----------------------+-----------+-----------+---------+
| Charge | 3,159 | 3,106 | 4,305 |
| for | | | |
| the | | | |
| period | | | |
+-----------------------+-----------+-----------+---------+
| Disposals/impairments | - | (402) | (1,656) |
+-----------------------+-----------+-----------+---------+
| Foreign | 8 | (13) | 58 |
| exchange | | | |
| adjustment | | | |
+-----------------------+-----------+-----------+---------+
| Balance | 15,078 | 12,860 | 12,876 |
| carried | | | |
| forward | | | |
+-----------------------+-----------+-----------+---------+
| Carrying | 178,682 | 181,422 | 180,135 |
| amount | | | |
+-----------------------+-----------+-----------+---------+
9 Trade and other receivables
+-------------+-----------+-----------+---------+
| | | | |
+-------------+-----------+-----------+---------+
| | As at | As at | As at |
+-------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+-------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+-------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+-------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+-----------+-----------+---------+
| Amounts | | | |
| falling | | | |
| due | | | |
| within | | | |
| one | | | |
| year: | | | |
+-------------+-----------+-----------+---------+
| Trade | 13,895 | 5,929 | 16,022 |
| receivables | | | |
+-------------+-----------+-----------+---------+
| Other | 12,123 | 13,712 | 13,134 |
| receivables | | | |
+-------------+-----------+-----------+---------+
| VAT | 1,616 | - | - |
| recoverable | | | |
+-------------+-----------+-----------+---------+
| Total | 27,634 | 19,641 | 29,156 |
| trade | | | |
| and | | | |
| other | | | |
| receivables | | | |
+-------------+-----------+-----------+---------+
| Prepayments | 17,078 | 35,512 | 19,160 |
| and accrued | | | |
| income | | | |
+-------------+-----------+-----------+---------+
| | 44,712 | 55,153 | 48,316 |
+-------------+-----------+-----------+---------+
10 Trade and other payables
+----------+-----------+-----------+---------+
| | | | |
+----------+-----------+-----------+---------+
| | As at | As at | As at |
+----------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+----------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+----------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+----------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------+-----------+-----------+---------+
| Amounts | | | |
| falling | | | |
| due | | | |
| within | | | |
| one | | | |
| year: | | | |
+----------+-----------+-----------+---------+
| Trade | 83,645 | 135,521 | 159,441 |
| payables | | | |
+----------+-----------+-----------+---------+
| Other | 11,021 | 5,994 | 6,041 |
| payables | | | |
+----------+-----------+-----------+---------+
| Tax | 5,450 | 3,215 | 5,924 |
| and | | | |
| social | | | |
| security | | | |
| costs | | | |
+----------+-----------+-----------+---------+
| VAT | 13,315 | 11,099 | 34,091 |
| payables | | | |
+----------+-----------+-----------+---------+
| Accruals | 43,466 | 36,587 | 52,706 |
| and | | | |
| deferred | | | |
| income | | | |
+----------+-----------+-----------+---------+
| | 156,897 | 192,416 | 258,203 |
+----------+-----------+-----------+---------+
11 Long-term borrowings
+-------------+-----------+-----------+---------+
| | As at | As at | As at |
+-------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+-------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+-------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+-------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+-----------+-----------+---------+
| Current | | | |
| portion | | | |
+-------------+-----------+-----------+---------+
| Bank | 96,424 | 103,866 | 16,864 |
| loans | | | |
+-------------+-----------+-----------+---------+
| Obligations | 360 | 462 | 497 |
| under | | | |
| finance | | | |
| leases and | | | |
| hire | | | |
| purchase | | | |
| contracts | | | |
+-------------+-----------+-----------+---------+
| | 96,784 | 104,328 | 17,361 |
+-------------+-----------+-----------+---------+
| Non-current | | | |
| portion | | | |
+-------------+-----------+-----------+---------+
| Bank | 15,594 | 33,333 | 23,782 |
| loans | | | |
+-------------+-----------+-----------+---------+
| Obligations | 120 | 293 | 126 |
| under | | | |
| finance | | | |
| leases and | | | |
| hire | | | |
| purchase | | | |
| contracts | | | |
+-------------+-----------+-----------+---------+
| | 15,714 | 33,626 | 23,908 |
+-------------+-----------+-----------+---------+
12 Analysis of net (debt) / funds
+-------------+-----------+-----------+-----------+
| | As at | As at | As at |
+-------------+-----------+-----------+-----------+
| | 31 | 31 | 31 |
| | July | July | January |
+-------------+-----------+-----------+-----------+
| | 2010 | 2009 | 2010 |
+-------------+-----------+-----------+-----------+
| | Unaudited | Unaudited | Audited |
+-------------+-----------+-----------+-----------+
| | GBP'000 | GBP'000 | GBP'000 |
+-------------+-----------+-----------+-----------+
| Cash | 48,995 | 57,768 | 86,128 |
| and | | | |
| cash | | | |
| equivalents | | | |
+-------------+-----------+-----------+-----------+
| Net | 48,995 | 57,768 | 86,128 |
| cash | | | |
| and | | | |
| cash | | | |
| equivalents | | | |
+-------------+-----------+-----------+-----------+
| Current | (96,784) | (104,328) | (17,361) |
| portion | | | |
| of | | | |
| long-term | | | |
| borrowings | | | |
+-------------+-----------+-----------+-----------+
| Long-term | (15,714) | (33,626) | (23,908) |
| borrowings | | | |
+-------------+-----------+-----------+-----------+
| Net | (63,503) | (80,186) | 44,859 |
| (debt) | | | |
| / | | | |
| funds | | | |
+-------------+-----------+-----------+-----------+
13 Called-up share capital
+------------+---------+--------------+---------+--------------+
| | | | | |
+------------+---------+--------------+---------+--------------+
| | 2010 | 2009 |
+------------+------------------------+------------------------+
| | GBP'000 | Number | GBP'000 | Number |
+------------+---------+--------------+---------+--------------+
| Authorised | | | | |
+------------+---------+--------------+---------+--------------+
| Ordinary | 24,000 | 480,000,000 | 24,000 | 480,000,000 |
| shares | | | | |
| of 5p | | | | |
+------------+---------+--------------+---------+--------------+
| Allotted, | | | | |
| called-up | | | | |
| and fully | | | | |
| paid | | | | |
+------------+---------+--------------+---------+--------------+
| Ordinary | 17,361 | 347,213,312 | 17,332 | 346,633,895 |
| shares | | | | |
| of 5p | | | | |
+------------+---------+--------------+---------+--------------+
Shares issued
During the period, 554,145 (2009 interim: 310,238; full year: 335,510) shares
were issued to employees exercising share options granted under various option
schemes. The total consideration received on the exercise of these options was
GBP315,879 (2009 interim: GBP198,068; full year: GBP216,799).
Shares purchased
During the period no shares (2009 interim: nil; full year: nil) were repurchased
for cancellation by the Company.
Trust shares
During the period 2,000,000 shares (2009 interim: 800,000; full year: 1,450,000)
were purchased at a cost of GBP1,925,800 (2009 interim: GBP1,254,252; full year:
GBP1,893,495). These shares are to be used wholly and exclusively to pay LTIP
awards when they become due for payment.
Trust shares comprise 3,684,073 (2009 interim: 1,870,484; full year: 2,368,001)
5p ordinary shares. The market value of these shares at 31 July 2010 is
GBP2,652,533 (2009 interim: GBP2,749,611; full year: GBP2,178,561).
14 Share Premium account
+------------+-----------+-----------+---------+
| | As at | As at | As at |
+------------+-----------+-----------+---------+
| | 31 | 31 | 31 |
| | July | July | January |
+------------+-----------+-----------+---------+
| | 2010 | 2009 | 2010 |
+------------+-----------+-----------+---------+
| | Unaudited | Unaudited | Audited |
+------------+-----------+-----------+---------+
| | GBP'000 | GBP'000 | GBP'000 |
+------------+-----------+-----------+---------+
| Amount | | | |
| subscribed | | | |
| for share | | | |
| capital in | | | |
| excess of | | | |
| nominal | | | |
| value | | | |
+------------+-----------+-----------+---------+
| At 1 | 46,662 | 46,462 | 46,462 |
| February | 288 | 182 | 200 |
| Arising | | | |
| on issue | | | |
| of | | | |
| shares | | | |
| during | | | |
| the year | | | |
| (net of | | | |
| expenses) | | | |
+------------+-----------+-----------+---------+
| | 46,950 | 46,644 | 46,662 |
+------------+-----------+-----------+---------+
15 Related party transactions
There were no related party transactions within the period.
16 Principal risks and uncertainties
Global economic conditions
There is a high degree of uncertainty in the global economy, with issues around
government and bank liquidity, business failures, and rising unemployment rates.
We recognise that all of these factors may have an impact on our customers'
willingness or ability to spend.
We will continue to put forward compelling product offers to meet the more value
conscious demands of our consumers.
+----------------+-------------+------------------+
| Risk | Potential | Mitigation |
| description | impact | activities |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| Technology | | |
+----------------+-------------+------------------+
| As | As | We |
| with | broadband | have |
| music | technology | recognised |
| and | | the |
| DVD | | |
+----------------+-------------+------------------+
| entertainment, | improves | increasing |
| the | there is | prominence |
| opportunity | a risk | of |
| | that | |
| | more | |
+----------------+-------------+------------------+
| exists | gamers | eCommerce |
| for pc | start | and |
| and | buying | digital |
| video | their | |
| games | games | |
| to | | |
+----------------+-------------+------------------+
| be | online. | downloading |
| distributed | This | and we have |
| digitally | will | |
| via the | reduce | |
| | the | |
| | number | |
+----------------+-------------+------------------+
| internet. | of | invested |
| PC games | people | in |
| which | buying | state-of-the-art |
| tend to | boxed | |
| | product | |
+----------------+-------------+------------------+
| have | from | eCommerce |
| smaller | retailers | websites |
| file | such as | and are |
| sizes | ourselves. | |
| are | | |
+----------------+-------------+------------------+
| available | | developing |
| from a | | a branded |
| number of | | presence |
+----------------+-------------+------------------+
| websites | | in |
| whereas | | many |
| video | | digital |
| games | | areas, |
| digital | | including |
+----------------+-------------+------------------+
| content | | mobile |
| is | | phones |
| offered | | and a |
| in a | | presence |
+----------------+-------------+------------------+
| limited | | in |
| way via | | PlayStation |
| official | | Home. |
| format | | |
+----------------+-------------+------------------+
| channels, | | |
| eg | | |
| Microsoft's | | |
| Xbox | | |
+----------------+-------------+------------------+
| Live | | |
| service. | | |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| Competition | | |
+----------------+-------------+------------------+
| The pc | We | We |
| and | believe | measure |
| video | that | our |
| games | the | stores' |
| market | specialist | |
| | has | |
+----------------+-------------+------------------+
| has | all of | performance |
| become | the | against |
| an | attributes | specific |
| increasingly | to succeed | KPIs |
| | in | |
+----------------+-------------+------------------+
| attractive | the pc | to |
| proposition | and | ensure |
| for | video | our |
| retailers. | games | proposition |
| | market | is |
+----------------+-------------+------------------+
| We | place. | always |
| have | | appealing |
| seen | | and |
| new | | relevant |
| entrants | | |
| to | | |
+----------------+-------------+------------------+
| the | | to |
| market | | consumers. |
| place, | | |
| including | | |
+----------------+-------------+------------------+
| specialists, | | |
| existing | | |
| generalists | | |
+----------------+-------------+------------------+
| and | | |
| supermarkets | | |
| and online | | |
+----------------+-------------+------------------+
| players. | | |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| Seasonality | | |
+----------------+-------------+------------------+
| The | Revenue, | The |
| Group's | operating | Group |
| business | profit | works |
| is | and cash | closely |
| seasonal | | with |
+----------------+-------------+------------------+
| with | flow | suppliers |
| the | may be | to secure |
| key | adversely | stock and |
| trading | impacted | |
| period | | |
| being | | |
+----------------+-------------+------------------+
| the | by | implement |
| Christmas | variations | high |
| season. | in demand | profile |
| | during | preorder |
| | this | |
+----------------+-------------+------------------+
| | period. | campaigns |
| | | in |
| | | advance |
| | | of all |
+----------------+-------------+------------------+
| | | major |
| | | releases. |
| | | The Group |
| | | also |
+----------------+-------------+------------------+
| | | undertakes |
| | | extensive |
| | | marketing |
+----------------+-------------+------------------+
| | | campaigns |
| | | to drive |
| | | consumer |
+----------------+-------------+------------------+
| | | awareness, |
| | | and flexes |
| | | headcount |
+----------------+-------------+------------------+
| | | in |
| | | store |
| | | to |
| | | maximise |
| | | the |
| | | sales |
+----------------+-------------+------------------+
| | | potential. |
+----------------+-------------+------------------+
| | | |
+----------------+-------------+------------------+
| Reputation | | |
+----------------+-------------+------------------+
| As a | This | To |
| specialist | means | mitigate |
| retailer | that | any |
| our | we | issues |
| | deal | that may |
| | with a | |
+----------------+-------------+------------------+
| customers | variety | arise |
| demand | of | through |
| that we | video | the |
| stock | games, | mis-selling |
| | for | of |
| | example | |
+----------------+-------------+------------------+
| the | age | these |
| broadest | restricted | games |
| range of | products. | we |
| product. | Mis-selling | employ |
| | | the |
| | | very |
+----------------+-------------+------------------+
| | such | highest |
| | titles | levels |
| | is | of |
| | illegal. | training |
+----------------+-------------+------------------+
| | | throughout |
| | | our |
| | | organisation. |
+----------------+-------------+------------------+
Directors and advisers
Directors
Peter Lewis Non-Executive Chairman
Ian Shepherd Chief Executive
Ben White ACA Group Finance Director
Christopher Bell Senior Non-Executive Director
Ishbel Macpherson Non-Executive Director
Dana Dunne Non-Executive Director
David Mansfield Non-Executive Director
Secretary
Vivienne Hemming ACIS
Registered office
Unity House, Telford Road, Basingstoke RG21 6YJ
Stockbrokers
Deutsche Bank, Winchester House,
1 Great Winchester Street, London EC2N 2DB
Oriel Securities Limited, 125 Wood Street,
London EC2V 7AN
Principal Bankers
The Royal Bank of Scotland plc,
Thames Valley Corporate Banking Centre,
Abbey Gardens, 4 Abbey Street, Reading RG1 3BA
Independent auditors
BDO LLP, 55 Baker Street,
London W1U 7EU
Registrars and transfer office
Capita Registrars, Northern House,
Woodsome Park, Fenay Bridge, Huddersfield HD8 0GA
Corporate website
www.gamegroup.plc.uk
Registered number
87583
[1] Source: GfK ChartTrack (UK panel: mint pc and video games market 1/2/10 to
31/7/10)
[2] Source: GfK ChartTrack, hardware and software revenues, 01/02/10 - 31/07/10
[3] Source: GfK ChartTrack UK market estimate
This information is provided by RNS
The company news service from the London Stock Exchange
END
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