TIDMLDSG
RNS Number : 4753N
Leeds Group PLC
23 January 2023
Issued on behalf of Leeds Group plc Embargoed: 7.00am
Date: 23 January 2023
Leeds Group plc
("Leeds Group" or "the Group" or "the Company")
Unaudited Interim Results for the six months ended 30 November
2022
The unaudited interim results of Leeds Group for the six months
ended 30 November 2022 are presented as follows:
This announcement contains inside information for the purposes
of UK Market Abuse Regulation and has been arranged for release by
Jan G Holmstrom, Chairman. The Directors of the Company accept
responsibility for the content of this announcement.
Enquiries:
Leeds Group plc Cairn Financial Advisers LLP
Dawn Henderson - 01937 547877 Sandy Jamieson / Liam Murray - 020 7213 0880
Chairman's Statement
The continuing activities of the Group are that of a textile
wholesaler and are conducted through its German trading subsidiary
Hemmers-Itex Textil Import Export GmbH ("Hemmers"). Stoff-Ideen-KMR
GmbH ("KMR"), a subsidiary of Hemmers, was placed into an
insolvency process on 7 October 2022.
The Group's turnover in the first six months of the financial
year is in line with last year at GBP15,575,000 (2021:
GBP15,592,000): The Group made a reduced loss before tax of
GBP224,000 (2021: loss of GBP487,000).
Hemmer's turnover increased slightly to GBP12,679,000 (2021:
GBP12,668,000) and the company made a loss of GBP164,000 (2021:
loss of GBP192,000). Trading is currently in line with forecast and
the cost cutting measures taken last year are providing a good
platform on which to rebuild a profitable business.
KMR's turnover decreased to GBP2,896,000 (2021: GBP2,924,000)
and the company made a loss of GBP75,000 (2021: loss of
GBP242,000). A property owned by KMR was sold in the period
realising GBP517,000 and resulted in a gain of GBP138,000. Although
in insolvency, KMR is still trading as it sells down the stock held
in its shops.
Group net bank debt, as analysed in note 5, was GBP6,131,000 as
at 30 November 2022 (30 November 2021: GBP5,877,000; 31 May 2022:
GBP6,381,000). Cash at bank as at 30 November was GBP1,845,000, of
which GBP1,677,000 related to KMR. This will be used by the
insolvency administrator to pay any outstanding KMR liabilities
including GBP863,000 of bank debt.
The Board and the Hemmers management are committed to returning
Hemmers to profitability and with the KMR insolvency, they can
focus solely on achieving this goal.
Jan G Holmstrom
Chairman
23 January 2023
Consolidated Statement of Comprehensive Income
for the six months ended 30 November 2022
Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021 GBP000
GBP000 GBP000
---------------------------------------- -------------- -------------- --------------------
Continuing operations
Revenue 15,575 15,592 29,590
Cost of sales (12,666) (12,514) (24,121)
Gross profit 2,909 3,078 5,469
Distribution costs (1,363) (1,250) (2,483)
Impairment of assets - - (1,662)
Administrative costs (1,664) (2,188) (4,461)
---------------------------------------- -------------- -------------- --------------------
Total administrative costs (1,664) (2,188) (6,123)
Other income 75 - 147
Total loss from operations (43) (360) (2,990)
Finance expense (181) (127) (255)
Loss before taxation (224) (487) (3,245)
Taxation 113 - (4)
Loss for the period/year attributable
to the equity holders of the Parent
Company (111) (487) (3,249)
Other comprehensive income/(loss)
for the period/year 130 (101) (135)
Total comprehensive income/(loss)
for the period/year attributable
to the equity holders of the Company 19 (588) (3,384)
======================================== ============== ============== ====================
Loss per share for profit attributable to the equity holders of
the Company
Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021
------------------------------- -------------- -------------- ----------
Basic and diluted total loss
per share (pence) 0.4p 1.8p 11.9p
=============================== ============== ============== ==========
Consolidated Statement of Financial Position
at 30 November 2022
Unaudited Unaudited Audited
As at As at As at
30 November 30 November 31 May
2022 2021 2022
GBP000 GBP000 GBP000
-------------------------------- -------------- -------------- ----------
Assets
Non-current assets
Property, plant and equipment 6,689 7,631 7,335
Right-of-use assets 173 2,175 170
Intangible assets 53 57 52
Total non-current assets 6,915 9,863 7,557
-------------------------------- -------------- -------------- ----------
Current assets
Inventories 11,227 12,446 11,994
Trade and other receivables 3,472 3,755 2,864
Corporation tax recoverable - 61 13
Cash and cash equivalents 1,845 216 471
Total current assets 16,544 16,478 15,342
-------------------------------- -------------- -------------- ----------
Total assets 23,459 26,341 22,899
================================ ============== ============== ==========
Liabilities
Non-current liabilities
Loans and borrowings (697) (987) (836)
Lease liabilities (953) (1,006) (1,165)
Total non-current liabilities (1,650) (1,993) (2,001)
-------------------------------- -------------- -------------- ----------
Current liabilities
Trade and other payables (2,699) (3,649) (3,065)
Loans and borrowings (7,279) (5,102) (5,671)
Lease liabilities (635) (1,524) (885)
Provisions - (100) (100)
Total current liabilities (10,613) (10,375) (9,721)
-------------------------------- -------------- -------------- ----------
Total liabilities (12,263) (12,368) (11,722)
================================ ============== ============== ==========
TOTAL NET ASSETS 11,196 13,973 11,177
================================ ============== ============== ==========
Capital and reserves attributable
to
equity holders of the Company
------------------------------------ -------- -------- --------
Share capital 3,279 3,279 3,279
Capital redemption reserve 1,113 1,113 1,113
Foreign exchange reserve 2,180 2,084 2,050
Retained earnings 4,624 7,497 4,735
TOTAL EQUITY 11,196 13,973 11,177
==================================== ======== ======== ========
Consolidated Cash Flow Statement
for the six months ended 30 November 2022
Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021 GBP000
GBP000 GBP000
---------------------------------------------- -------------- -------------- ----------
Cash flows from operating activities
Loss for the period/year (224) (487) (3,249)
Adjustments for:
Government assistance credit - - (119)
Depreciation of property, plant and
equipment 399 334 735
Impairment of property, plant and
equipment - - 42
Depreciation of right-of-use assets 56 461 827
Impairment of right-of-use assets - - 1,620
Amortisation of intangible assets - - 5
Finance expense - interest on bank
loans 153 89 179
Finance expense - interest on lease
liabilities 28 38 76
Gain on sale of property (138) - -
Taxation credit - - 4
Cash flows generated from operating
activities before changes in working
capital and provisions 274 435 120
Decrease/(increase) in inventories 947 (2,254) (1,818)
(Increase) in trade and other receivables (1,169) (677) (43)
Increase in trade and other payables 499 1,386 722
Cash generated from/(used in) operating
activities 551 (1,110) (1,019)
Taxation received 28 73 114
Net cash flows generated from/(used
in) operating activities 579 (1,037) (905)
============================================== ============== ============== ============
Investing activities
Purchase of property, plant and equipment (22) (283) (447)
Proceeds from sale of property 517 -
Net cash generated from/(used in)
investing activities 495 (283) (447)
============================================== ============== ============== ============
Financing activities
Bank borrowings drawn 1,515 2,272 2,835
Bank borrowings repaid (150) (564) (708)
Repayment of principal on lease liabilities (542) (519) (983)
Repayment of interest on lease liabilities (28) (38) (76)
Bank interest paid (153) (89) (179)
Government assistance received - - 119
Net cash generated from financing
activities 642 1,062 1,008
============================================== ============== ============== ============
Net increase/(decrease) in cash
and cash equivalents 1,716 (258) (344)
Translation gain/(loss) on cash and
cash equivalents 3 (2) (2)
Cash and cash equivalents at beginning
of period/year 126 472 472
Cash and cash equivalents at end
of period/year 1,845 212 126
============================================== ============== ============== ============
Cash on demand or on short term deposit 1,845 216 471
Bank overdrafts - (4) (345)
============================================== ============== ============== ============
Cash and cash equivalents at end
of period/year 1,845 212 126
============================================== ============== ============== ============
Consolidated Statement of Changes in Equity
for the six months ended 30 November 2022
Unaudited Share Capital Foreign Retained Total
capital redemption exchange earnings equity
reserve reserve
GBP000 GBP000 GBP000 GBP000 GBP000
----------------------------- ---------- ------------- ----------- ----------- ---------
At 1 June 2022 3,279 1,113 2,050 4,735 11,177
Loss for the period - - - (111) (111)
Other comprehensive income - - 130 - 130
At 30 November 2022 3,279 1,113 2,180 4,624 11,196
============================= ========== ============= =========== =========== =========
Unaudited Share Capital Foreign Retained Total
capital redemption exchange earnings equity
reserve reserve
GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------- ---------- ------------- ----------- ----------- ---------
At 1 June 2021 3,279 1,113 2,185 7,984 14,561
Loss for the period - - - (487) (487)
Other comprehensive loss - - (101) - (101)
At 30 November 2021 3,279 1,113 2,084 7,497 13,973
=========================== ========== ============= =========== =========== =========
Audited Share Capital Foreign Retained Total
capital redemption exchange earnings equity
reserve reserve
GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------- ---------- ------------- ----------- ----------- ---------
At 1 June 2021 3,279 1,113 2,185 7,984 14,561
Loss for the year - - - (3,249) (3,249)
Other comprehensive loss - - (135) - (135)
At 31 May 2022 3,279 1,113 2,050 4,735 11,177
=========================== ========== ============= =========== =========== =========
The following describes the nature and purpose of each reserve
within equity:
Reserve Description and purpose
-------------------------- -----------------------------------------------------
Capital redemption Amounts transferred from share capital on redemption
reserve of issued shares
Treasury share reserve Cost of own shares held in treasury
Foreign exchange reserve Gains/(losses) arising on retranslation of
the net assets of overseas operations into
sterling
Retained earnings Cumulative net gains/(losses) recognised in
the consolidated statement of comprehensive
income after deducting the cost of cancelled
treasury shares
Notes to the Interim Results
for the six months ended 30 November 2022
1. General information
Leeds Group plc is an AIM listed public company, limited by
shares and incorporated in England and Wales under the Companies
Act and its number is 00067863. The address of the registered
office is Craven House, 14-18 York Road, Leeds, Wetherby, LS22
6SL.
The interim results for the six months ended 30 November 2022
and 30 November 2021 are unaudited. The interim financial
statements have been prepared in accordance with the recognition
and measurement principles of International Financial Reporting
Standards as adopted in the United Kingdom ("UK adopted IFRS")
using the accounting policies that are expected to apply in the
preparation of the next annual financial statements. The Group has
chosen not to comply with IAS 34 'Interim Financial Statement' in
these interim financial statements.
The information presented for the year ended 31 May 2022 does
not constitute the Company's statutory accounts. The financial
statements for the year ended 31 May 2022 have been filed with the
Registrar of Companies and the Independent Auditor's Report was
unqualified however drew attention to a material uncertainty
regarding the going concern of the Group. The Independent Auditor's
Report did not refer to any matters in respect of s498(2) and (3)
of the Companies Act 2006.
The Group's financial statements for the year ended 31 May 2022
included a post balance sheet event note explaining that KMR was
placed into an insolvency process, which was accepted by the German
courts on 7 October 2022. Under German law, there was an initial
period of three months where KMR was operated as a trading entity
under the joint control of the KMR management and the insolvency
administrator. Following this period, the administrator has assumed
full responsibility for the operations of KMR and will look to
realise its assets and pay any liabilities due in accordance with
German insolvency law.
2. Accounting policies
Going Concern
When considering its opinion about the application of the going
concern basis of preparation of the financial statements, the
Directors have given due consideration to:
-- The performance of the Group in the last financial year and
the robustness of forecasts for period to 31 May 2024, which return
the Group to profit.
-- The impact of the ongoing Ukraine conflict on the business,
its suppliers and its customers.
-- The financing facilities available to the Group and the
circumstances in which these could be limited or withdrawn.
Forecasts have been prepared for the period to May 2024 which
indicate a return to modest profit over that period due to cost
reductions. These forecasts have been prepared in the knowledge of
current Ukraine conflict conditions and the continuing impact on
the German and global economies. Considering the trading results in
the first half of the current financial year and the decision to
put KMR into insolvency, the Directors consider there will be
sufficient headroom available on the Hemmers working capital
facility and, therefore, the Directors are of the opinion that it
is appropriate to apply the going concern basis of preparation to
the financial statements.
2. Loss per share
Ordinary shares of 12 pence each used in the calculation of
earnings per share:
Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021 GBP000
GBP000 GBP000
--------------------------------------- -------------- -------------- ------------
Number of shares (basic and diluted) 27,320,843 27,320,843 27,320,843
======================================= ============== ============== ============
3. Segmental information
Group external revenue Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021 GBP000
GBP000 GBP000
------------------------- -------------- -------------- ----------
Continuing operations
Hemmers 12,679 12,668 23,998
KMR 2,896 2,924 5,592
Group external revenue 15,575 15,592 29,590
========================= ============== ============== ==========
Group loss before tax Unaudited Unaudited Audited
6 months 6 months Year to
to to 31 May
30 November 30 November 2022
2022 2021 GBP000
GBP000 GBP000
------------------------ -------------- -------------- ----------
Continuing operations
Hemmers (164) (192) (793)
Holding company 15 (53) (82)
KMR (75) (242) (2,370)
Group loss before tax (224) (487) (3,245)
======================== ============== ============== ==========
Group net assets Unaudited Unaudited Audited
As at As at As at
30 November 30 November 31 May
2022 2021 2022
GBP000 GBP000 GBP000
------------------------ -------------- -------------- ---------
Continuing operations
Hemmers 9,604 9,931 9,301
Holding company 2,770 2,750 2,720
KMR (1,178) 1,292 (844)
Group net assets 11,196 13,973 11,177
======================== ============== ============== =========
4. Analysis of net bank debt
Unaudited Unaudited Audited
As at As at As at
30 November 30 November 31 May
2022 2021 2022
GBP000 GBP000 GBP000
-------------------------------------- -------------- -------------- ---------
Cash on demand and on short term
deposit 1,845 216 471
Bank overdrafts - (4) (345)
Current loans and borrowings (7,279) (5,102) (5,671)
Non - current loans and borrowings (697) (987) (836)
Net bank debt at end of period/year (6,131) (5,877) (6,381)
====================================== ============== ============== =========
Current loans and borrowings
At 30 November 2022, current loans and borrowings of
GBP7,279,000 (2021: GBP5,102,000) comprise short term loans of
GBP6,976,000 and instalments due on long term loans detailed below
of GBP303,000. The interest rate on the short-term loans ranges
from 1.5% to 3% (2021: 1.5% to 3%) and these loans are secured on
working capital of Hemmers and KMR. The short-term loans are drawn
down by Hemmers against short-term borrowing facilities of up to a
maximum of GBP9.9m (EUR11.5m) and by KMR against short-term
borrowing facilities of GBP0.9m (EUR1m).
Non-current loans and borrowings
The Group's non-current loans and borrowings are within the
accounts of Hemmers and are denominated in Euros as follows:
Fixed Repayment Final Unaudited Unaudited Audited
interest profile repayment As at As at As at
rate date 30 November 30 November 31 May
2022 2021 2022
GBP000 GBP000 GBP000
Equal
Loan quarterly September
1 1.65% instalments 2025 479 710 590
Equal
Loan quarterly
2 1.05% instalments March 2026 218 277 246
Non-current loans 697 987 836
==================================== ============ ============== ================ ===========
5 . Forward-Looking Statements
Certain statements made in this announcement are forward-looking
statements. These forward-looking statements are not historical
facts but rather are based on the Company's current expectations,
estimates, and projections about its industry; its beliefs; and
assumptions. Words such as 'anticipates,' 'expects,' 'intends,'
'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions
are intended to identify forward-looking statements. These
statements are not a guarantee of future performance and are
subject to known and unknown risks, uncertainties, and other
factors, some of which are beyond the Company's control, are
difficult to predict, and could cause actual results to differ
materially from those expressed or forecasted in the
forward-looking statements. The Company cautions security holders
and prospective security holders not to place undue reliance on
these forward-looking statements, which reflect the view of the
Company only as of the date of this announcement. The
forward-looking statements made in this announcement relate only to
events as of the date on which the statements are made. The Company
will not undertake any obligation to release publicly any revisions
or updates to these forward-looking statements to reflect events,
circumstances, or unanticipated events occurring after the date of
this announcement except as required by law or by any appropriate
regulatory authority.
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END
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