TIDMHYNS
RNS Number : 0120F
Haynes Publishing Group PLC
17 April 2014
HAYNES PUBLISHING GROUP P.L.C.
Interim Management Statement (IMS)
Haynes Publishing Group ("the Group") presents its third quarter
IMS covering the 13 weeks to 28 February 2014 and to the date of
publication of this Statement ("the period") in accordance with DTR
4.3.4.
Business highlights
In the US, an agreement with a key customer to install new
display racks in 4,900 of its retail stores was completed in
January 2014. The re-merchandising programme means 21 new US titles
are now available in all of its North American stores and 5 new
Spanish language titles are being displayed in 700 of its Hispanic
outlets. An associated return of obsolete inventory, following this
re-merchandising exercise, has adversely affected US revenue during
the third quarter and management expects all the related returns to
flow through US revenue by the end of the financial year.
Nevertheless, despite these returns, management is confident that
the improved in-store displays and refreshed store inventory will
have a positive impact on future sales.
On 3 February 2014, the UK distribution was successfully
transferred to Grantham Book Services (GBS), part of the Random
House Group. From this date GBS have taken over the warehousing and
distribution of the UK inventory, including customer invoicing,
customer services and cash collection.
At the beginning of March 2014, the Group commenced action to
restructure its global automotive editorial functions resulting in
three voluntary redundancies in the UK business. The expected cost
of the automotive editorial restructuring will be GBP0.2 million,
increasing the total restructuring costs in the financial year to
GBP1.5 million. Management expects the resulting cost savings to
the UK business will be GBP0.6 million in 2014/15, anticipated to
increase to GBP0.8 million in 2015/16.
During the period, HaynesPro completed the development of a new
Touch interface specifically designed for use on tablets and
smartphones. Utilising the new Workshop Connect(TM) feature, all
the information is linked to a user's account in the cloud, making
it accessible from any device. The stored information includes
recently viewed vehicles, saved cost estimates, work orders,
specific vehicle configurations and user settings. HaynesPro
expects to release and market the new Touch interface at the
Automechanika automotive aftermarket show in September 2014.
Third quarter trading
Total Group revenue for the third quarter was 7% down compared
to the same period last year, as softer trading conditions in the
UK and the associated returns from the new display roll-outs in the
US adversely affected revenue. Nevertheless, year-to-date Group
revenue for the nine months to 28 February 2014 was 4% ahead of
last year.
Revenue from the Group's North American and Australian business,
in local currency, ended the third quarter 10% ahead of last year.
On a like-for-like basis, excluding the revenue from Clymer manual
sales, North American and Australian revenue was down 4%. The lower
like-for-like revenue reflects the inventory returns from the
re-merchandising programme and softer post-Christmas trading as
severe weather conditions affected consumer spending and retail
activity in many areas of the US, most notably on the East Coast.
Management can report that the Clymer and Intertec business
acquired in September 2013 continues to perform well and in line
with management expectations.
Overall North American and Australian revenue for the first nine
months of the financial year was 10% ahead of the prior year.
In the UK and Europe, a smaller but more focussed front-list
publishing programme for our non-automotive titles coupled with
weaker third quarter trading for our core automotive manuals led to
a revenue shortfall in the UK against the prior period of 27%,
while European revenue, in local currency, was down 1%. Overall
third quarter UK and European revenue was down 17%. However we are
optimistic that the focus on higher margin manuals will have a
positive impact on future UK sales.
For the nine months to 28 February 2014, UK and European revenue
in total was down 2% with UK revenue down 11% against the prior
period. Encouragingly, we have continued our strong growth in
European digital sales, with revenue ahead of last year by 15%.
As at 28 February 2014, the Group's cash and cash equivalents
was GBP1.3 million (30 November 2013: GBP0.7 million).
The events highlighted above represent the main changes to the
Group's financial position since the Group reported its half year
results for the six months ended 30 November 2013.
Cautionary Statement :
This report contains certain forward-looking statements with
regards the financial condition and results of the operations of
Haynes Publishing Group P.L.C. These statements and forecasts
involve risk factors which are associated with, but are not
exclusive to, the economic and business circumstances occurring
from time to time in the countries and sectors in which the Group
operates. These forward-looking statements are made only as at the
date of this announcement. Nothing in this announcement should be
construed as a profit forecast. Except as required by law, Haynes
Publishing Group P.L.C. has no obligation to update the
forward-looking statements or to correct any inaccuracies
therein.
Enquiries :
Haynes Publishing Group P.L.C. +44 1963 442009
J Haynes, Group Chairman
Eric Oakley, Group Chief Executive
Investor Contact: Charles Stanley Securities +44 20 7149 6000
Dugald J Carlean
Karri Vuori
Media Contact: New Century Media +44 20 7930 8033
Nicola Krafft
Business Description
The Haynes Group comprises two geographical business segments as
follows :
-- UK & Europe
-- North America & Australia.
The UK & European business has headquarters in Somerset,
England and subsidiaries in the Netherlands, Italy, Spain, Romania
and Sweden. The core business of the European operations is the
digital supply of automotive repair and technical information to
professional mechanics in twenty four different languages, as well
as to DIY consumers in both printed manual and digital formats. The
business also publishes a wide range of manuals which are
practical, instructional, easy to read and aimed at those with an
interest in more general DIY related activities.
The North American & Australian business has headquarters
near Los Angeles, California and publishes DIY repair manuals for
cars and motorcycles in both a printed and digital format. The
business publishes titles under the Haynes, Chilton and Clymer
brands and in both the English and Spanish languages. Clymer
manuals also cover marine (inboard and outboard) personal
watercraft and snowmobiles, while the Intertec brand publishes
manuals for agricultural equipment. It has a branch operation in
Sydney, Australia which publishes similar products under both the
Haynes and Gregory brands. The Australian business also publishes
information for the professional automotive market. Through its
print facility in Nashville, Tennessee, the North American business
is the central print facility for the Group's printed products.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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