RNS Number:0923M
Luminar PLC
15 November 2006
Luminar plc
Interim results for the half year ended 31 August 2006
Clear strategy, transformational plans in place for the Entertainment Division
Highlights
* Good progress in the transformation to a focused late night branded
destination dancing business.
* Advanced stages on a plan to divest the Entertainment Division to a new
company in which Luminar will hold a minority interest. Luminar plan to
complete a non-recourse sale and leaseback transaction of freehold properties
of the Entertainment Division and certain clubs, which do not fit Luminar's
stated strategy. The proceeds will be added to the Company's plan to return
surplus cash to shareholders.
* Total sales from continuing operations were up 3.8% to #99.4m (2005: #95.8m).
* EBITDA from continuing operations pre-exceptional items of #22.0m (2005:
#26.6m).
* PBT: Total pre-exceptional items of #17.9m (2005: #21.1m);
Continuing operations pre-exceptional items of #7.6m (2005: #10.8m);
Continuing operations post exceptional items of #6.7m (2005: #15.0m).
* EPS from continuing operations pre-exceptional items of 7.5p (2005: 10.5p).
* Dancing Division sales from continuing operations, during a challenging
period, were up 8.3% but down 4.7% on a like-for-like basis. Now normalised
trading patterns have been re-established, sales performance has improved.
- Admissions up 6%,
- 2006/07 development programme complete: 5 branded openings
during the period and a further 7 branded clubs already opened
in H2.
* Net debt reduced by #21.5m from 1 September 2005 to #118.9m, but increased
by #3.9m from the prior year end figure of #115.0m.
* Share buyback programme to recommence in H2 in line with timescales
previously announced.
* Increase of 10% in the interim dividend to 4.88p (2005: 4.44p).
* Good progress made towards #4.0m cost saving target over 3 years. On
track to meet #2.0m savings in 12 months.
* Scottish smoking ban experience continuing to be positive, particularly
in dancing units with outside smoking areas. Preparations well advanced for
England and Wales.
* Alan Jackson to succeed Keith Hamill as Chairman on 5 December.
* Current trading: Sales from continuing operations for the 8 weeks to 2
November were up 7.8%, Dancing Division up 12.1%. Like-for-like sales from
branded dancing up 4.3%.
Stephen Thomas, Chief Executive, said:
"We have continued to make significant progress towards a focus on a high
quality, branded destination dancing estate. The planned divestment of the
Entertainment Division will be transformational and accelerates our strategy.
The performance of our core business, branded dancing, gives us confidence in
the future."
15 November 2006
Enquiries
Luminar plc
Stephen Thomas, Chief Executive Tel: 020 7457 2020 (today)
Nick Beighton, Finance Director Tel: 01908 544100 (thereafter)
College Hill
Matthew Smallwood Tel: 020 7457 2020
Chairman and Chief Executive's Statement
Introduction
Luminar plc today presents its unaudited results for the half year ended 31
August 2006.
The Board continues to focus on the strategy of building on its position as the
leading operator of destination branded dancing venues and delivering
shareholder value.
During the last 6 months, the Company has continued to make good progress in its
transformation to a focused late night branded destination dancing business. By
31 August 2006, the Company was operating 45 branded dancing units, representing
50% of total annualised dancing revenue. There were 5 branded openings during
the half year. The Company has now completed its 2006/07 development programme,
opening a total of 12 branded units.
Disposal of the Entertainment Division
Following the Board's decision in May to sell or demerge the Entertainment
Division, the Board has explored various opportunities and has concluded that a
sale and leaseback of the freehold units in conjunction with a disposal, is the
best strategy to deliver enhanced shareholder value.
The Board has enlarged the disposal package of units to include a number of
unbranded nightclubs and is in exclusive talks to finalise the details. It is
anticipated that the divestment will take the form of a non-recourse sale and
leaseback of the freehold units and the creation of a new operating company in
which Luminar will hold a minority equity stake and a vendor loan note. The
Board has not recognised any further impairment charges at the end of August
2006, as it anticipates realising value in excess of the carrying amount.
Negotiations are at an advanced stage and full details will be sent to
shareholders in due course. The Company intends to then return any surplus
funds to shareholders as previously intimated. These proceeds will be in
addition to the #70m already earmarked for our share buyback programme.
Results
There were a number of well documented factors that have impacted the Company's
results for the period, creating one of the most challenging periods in its
history.
Turnover from continuing operations for the half year ended 31 August 2006 was
#99.4m, (2005: #95.8m). The increase in turnover has come from the Dancing
Division, in which sales have increased by #6.9m (8.3%) primarily due to the
#7.6m of additional sales derived from the units acquired in November 2005 from
The Nightclub Company. Like-for-like sales from continuing operations in the
Dancing Division were down 4.7%.
Transformation to Future Business Structure
In line with the strategy to transform the Company into a focused late night
branded destination business, the segments of the Company have been revised to
the following:
Aug 06 Aug 06 Aug 06
Segments Total units Revised segments Continuing Discontinued Future
units units units
Branded * 45 Branded * 44 1
Unbranded 54 Unbranded 50 4
Dancing 99 Dancing 94 5 120
Entertainment 72
Non-Core 44
Entertainment
and Non-Core 116 Non-Core 14 102 -
215 108 107 ** 120
Note: A more detailed unit reconciliation is provided as Appendix 1 to this
statement
* Branded dancing units include 5 Oceanas, 27 Liquids and 10 Lava & Ignites
** This excludes 4 closed / sub-let units, to bring the total number of units
held for sale to 111
The future Luminar business will be a high quality, predominantly branded,
nightclub business, offering a differentiated product. Approximately 70% of the
future business units will be branded. The majority of the Entertainment
Division has been reported within discontinued operations.
Segmental Review
The performance of each segment within continuing operations is set out below:
Units Revenue Revenue per unit Profit from operations * Profit from
operations per
unit *
H1 H1 H1 H1 H1 H1 H1 H1
2007 2006 2007 2006 2007 2006 2007 2006
Number #m #m #'000 #'000 #m % #m % #'000 #'000
Dancing 94 90.1 83.2 959 885 21.0 23.3 23.5 28.2 223 250
Non-Core trading 14 9.3 12.6 664 900 (1.1) (11.8) 1.6 12.7 (79) 114
Continuing
operations * * 108 99.4 95.8 920 887 19.9 20.0 25.1 26.2 184 232
* Profit from operations is stated before exceptional items and net
finance costs
* * Profit from continuing operations is stated before corporate costs
Dancing
During the half year, the Company has continued to transform its underlying
business to a more focused destination branded dancing business. At 31 August
2006 there were 94 dancing units reported within continuing operations, 44
branded and 50 unbranded.
During the period 5 branded units (2005: 7) were opened. Since the half year, a
further 7 units have been re-branded - into 3 Oceanas, 3 Liquids and 1 Lava &
Ignite.
Of the 13 units acquired from The Nightclub Company in the prior year, 3 units
have been combined with others to create 10 larger units.
Continuing sales for dancing units totalled #90.1m (2005: #83.2m), an increase
of 8.3%, with continuing like-for-like sales down by 4.7%. Like-for-like sales
for the Oceana and Lava & Ignite brands were up 3.6% and 6.5% respectively.
Operating profit contribution from continuing operations before exceptional
items was #21.0m, (2005: #23.5m), with the Oceana brand achieving growth in
operating profit of 89.5% from #1.9m to #3.6m, with #1.2m of this increase being
derived from 2 new Oceanas. Operating margin reduced to 23.3%, (2005: 28.2%)
mainly as a result of higher fixed costs and carrying the closure costs of The
Nightclub Company units.
Non-Core
The non-core units reported within continuing operations include the 8 units
previously reported within the Entertainment Division, 1 trading unit and 5
closed units pending disposal. The former entertainment units have been
retained intentionally by management, as they will form part of a larger branded
development in each location.
Sales from the Non-Core Division were #9.3m (2005: #12.6m), with continuing
like-for-like sales down 13.7%. The continuing operating loss before
exceptional items was #1.1m (2005: profit #1.6m).
Financial Review
The gross profit margin of the Company has improved by 1.1% to 82.5% (2005:
81.4%), with 0.3% improvement in continuing operations to 84.1% (2005: 83.8%).
Continuing administrative expenses before exceptional items were #72.6m, (2005:
#64.9m), up #7.7m, 11.9%, on the prior year. These expenses include #8.9m of
corporate costs (2005: #9.7m).
Of the #7.7m increase in expenses, #6.4m of costs can be directly attributed to
The Nightclub Company units. During the first half, these units were not
operating at their full capacity as they awaited re-branding. 3 of these units
were closed in the first half, but have since re-opened under a branded template
and are trading in line with expectations. A further 4 units will be closed for
refurbishment during the second half.
We remain focused on reducing our corporate cost base and have set a target of
#4.0m over 3 years. We are on track with our plan to deliver #2.0m of cost
savings in the first 12 months, as we have already delivered costs savings of
#0.8m in the first 6 months.
Earnings before interest, tax, depreciation and amortisation (EBITDA) from
continuing operations pre-exceptional items were down #4.6m to #22.0m (2005:
#26.6m). However EBITDA from continuing operations for the Dancing Division was
only down #2.3m to #29.6m (2005: #31.9m).
Net finance costs relating to continuing operations have reduced to #3.4m (2005:
#4.6m), from the prior year level, as a result of lower average net debt levels.
Profit before tax on continuing operations pre-exceptional items was down #3.2m
to #7.6m, (2005: #10.8m); pre-corporate costs, the profit before tax on
continuing operations pre-exceptional items was #16.5m (2005: #20.5m).
Basic earnings per share from continuing operations pre-exceptional items was
down 3.0p to 7.5p, (2005: 10.5p), and earnings per share from continuing
operations pre-exceptional items and corporate costs was 19.8p (2005: 23.8p).
Basic earnings per share from continuing operations post-exceptional items was
6.3p (2005: 16.3p).
Exceptional items before tax relating to continuing operations were #0.9m,
(2005: #4.2m income). In the prior year, a profit on the sale and leaseback of
the Company's Hemel Hempstead complex realised a profit of #5.4m. Profit before
tax on continuing operations post-exceptional items was down #8.3m to #6.7m
(2005: #15.0m).
Cash Flow and Net Debt
The Company continues to enjoy strong cash flows enabling it to reduce its net
debt. Net debt has reduced by #21.5m since 1 September 2005, but has increased
by #3.9m since the prior year end; #2.4m of this increase being due to the share
buyback in the period.
Cash flow from operating activities was #24.3m (2005: #33.2m). #5.5m of the
inflow in the half year ended 1 September 2005 was due to tax received. Capital
expenditure during the first half totalled #25.9m (2005: 24.6m).
8 single sites (including the Luton administration centre, 2 lease surrenders
and 1 lease expiry) were disposed of in the first half for sale proceeds of
#4.6m. These transactions were completed in total at book value. #4.9m was
received during the period in relation to prior year single site disposals and
#0.9m was received in relation to the disposal of the Candu Entertainment
Limited. Cash costs associated with the disposal totalled #1.5m.
A repayment of #45.0m of long-term borrowings was made during the period from
surplus cash funds.
Return of Capital and Dividend
The Board has commenced its share buyback programme with the buyback of 504,805
shares for #2.4m in the first half. It is intended to continue with its policy
of #70m of buybacks in line with the timescales previously announced. Any
additional proceeds from the realisation of the Entertainment Division
divestment will also be returned to shareholders.
The Board has proposed an interim dividend of 4.88p, which is an increase of 10%
from the prior year interim dividend (2005: 4.44p) in line with the stated
policy of moving towards a dividend cover of two times.
Management and Board
At the time of the announcement of the Company's preliminary results in May
2006, the Chairman, Keith Hamill, stated his intention to retire from the
Luminar Board by the end of 2006. Keith will leave the Luminar Board on 5
December 2006 when he will handover to the new Chairman. The Board would like
to express its gratitude to Keith for his significant contribution over the last
6 years.
The Board is pleased to announce that Alan Jackson will take on the role as
Chairman from 5 December 2006. Alan has a significant track record in the
Leisure Industry. For 18 years, from 1973 to 1991, he occupied various
positions within Whitbread, principally Managing Director of Beefeater
steakhouses and also the Whitbread restaurant division, where he was responsible
for the creation and development of the Beefeater, Travel Inns and TGI Friday
brands. After the Beer Orders in 1991, he founded his own business which became
Inn Business Group plc in 1995 and was subsequently acquired by Punch in 1999.
He chaired Oriental Restaurant Group plc until its sale to Noble House in 2000.
Currently the only public quoted company directorships that Alan holds are
Non-Executive Chairman of The Restaurant Group plc and Non-Executive Director of
Playtech plc. Alan is also on the board of several other non public companies,
including Charles Wells Limited. In the last 5 years, Alan has also held
non-executive directorships in De Vere Plc and Regent Inns Plc.
As announced on 6 November 2006, the Board has strengthened the operations
structure with the appointment of David Haimes as Managing Director of
Operations. David has considerable experience in the Retail and Leisure sector
and reports directly to Stephen Thomas.
Current Trading and Outlook
Trading since the half year end has been encouraging. Management is encouraged
to report a continuing positive effect of the smoking ban in Scotland.
Management is also pleased to report that sales from continuing operations for
the 8 weeks to 2 November 2006 are up by 7.8%, with sales in the Dancing
Division up 12.1%. Our branded dancing like-for-like sales are up by 4.3%.
This sales uplift has been particularly driven by performance in our core
branded dancing units with Oceana up 5.2%, Lava & Ignite up 9.4% and Liquid up
2.4%.
The performance of the Company's core business, branded dancing, gives
management confidence in the future.
Independent review report to Luminar plc
Introduction
We have been instructed by the company to review the financial information for
the half year ended 31 August 2006 which comprises the Consolidated Income
Statement, the Consolidated Balance Sheet, the Consolidated Cash Flow Statement,
the Consolidated Statement of Changes in Shareholders' Equity, and the related
notes. We have read the other information contained in the interim report and
considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The Listing Rules
of the Financial Services Authority require that the accounting policies and
presentation applied to the interim figures should be consistent with those
applied in preparing the preceding annual accounts except where any changes, and
the reasons for them, are disclosed.
This interim report has been prepared in accordance with the basis set out in
Note 1.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom. A review
consists principally of making enquiries of group management and applying
analytical procedures to the financial information and underlying financial data
and, based thereon, assessing whether the disclosed accounting policies have
been applied. A review excludes audit procedures such as tests of controls and
verification of assets, liabilities and transactions. It is substantially less
in scope than an audit and therefore provides a lower level of assurance.
Accordingly we do not express an audit opinion on the financial information.
This report, including the conclusion, has been prepared for and only for the
company for the purpose of the Listing Rules of the Financial Services Authority
and for no other purpose. We do not, in producing this report, accept or assume
responsibility for any other purpose or to any other person to whom this report
is shown or into whose hands it may come save where expressly agreed by our
prior consent in writing.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the half year ended
31 August 2006.
PricewaterhouseCoopers LLP
Chartered Accountants
London
15 November 2006
Notes:
(a) The maintenance and integrity of the Luminar plc web site is the
responsibility of the directors; the work carried out by the auditors does not
involve consideration of these matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the interim report
since it was initially presented on the web site.
(b) Legislation in the United Kingdom governing the preparation and
dissemination of financial information may differ from legislation in other
jurisdictions.
Consolidated Income Statement
for the half year ended 31 August 2006
Half year ended 31 August 2006 Half year ended 1 September Year ended 2 March 2006
(unaudited) 2005 (unaudited) (audited)
Pre- Exceptional Total Pre- Exceptional Total Pre- Exceptional Total
exceptional items exceptional items exceptional items
items (note 7) items (note 7) items (note 7)
Note #m #m #m #m #m #m #m #m #m
Continuing
operations
Revenue 2 99.4 - 99.4 95.8 - 95.8 201.4 - 201.4
Cost of sales (15.8) - (15.8) (15.5) - (15.5) (32.7) - (32.7)
Gross profit 83.6 - 83.6 80.3 80.3 168.7 - 168.7
Administrative (72.6) (0.9) (73.5) (64.9) 7.7 (57.2) (135.1) (0.9) (136.0)
expenses
Profit /
(loss) from
trading
operations 2 11.0 (0.9) 10.1 15.4 7.7 23.1 33.6 (0.9) 32.7
Exceptional
items relating
to closure of
properties - - - - (3.5) (3.5) - (14.6) (14.6)
Profit /
(loss) from
operations * 11.0 (0.9) 10.1 15.4 4.2 19.6 33.6 (15.5) 18.1
Interest 3 0.9 - 0.9 1.5 - 1.5 2.6 - 2.6
receivable
Finance costs 3 (4.3) - (4.3) (6.1) - (6.1) (11.1) - (11.1)
Profit /
(loss) before
taxation 7.6 (0.9) 6.7 10.8 4.2 15.0 25.1 (15.5) 9.6
Tax on profit
/ (loss) 4 (2.1) - (2.1) (3.1) - (3.1) (7.3) 5.4 (1.9)
Profit /
(loss) for the
period from
continuing
operations
attributable
to equity
shareholders 5.5 (0.9) 4.6 7.7 4.2 11.9 17.8 (10.1) 7.7
Profit /
(loss) from
discontinued
operations ** 8 7.0 (3.9) 3.1 5.0 (2.8) 2.2 15.2 (21.2) (6.0)
Profit /
(loss) for the
period
attributable
to equity
shareholders 12.5 (4.8) 7.7 12.7 1.4 14.1 33.0 (31.3) 1.7
Earnings per
share from
continuing 6
operations
Basic 6.3p 16.3p 10.5p
Diluted 6.3p 16.2p 10.5p
Earnings per 6
share from
continuing and
discontinued
operations
Basic 10.6p 19.3p 2.3p
Diluted 10.5p 19.2p 2.3p
Dividends per 5 10.74p 9.76p 14.20p
share
* The profit / (loss) from operations is stated after corporate costs of #9.7m
post exceptional items (half year ended 1 September 2005: #12.2m, year ended 2
March 2006: #23.7m)
** The profit / (loss) relating to discontinued operations is stated after tax.
Consolidated Balance Sheet
at 31 August 2006
31 August 2006 1 September 2005 2 March 2006
(unaudited) (unaudited) (audited)
Note #m #m #m
Non-current assets
Goodwill 177.5 203.1 177.5
Other intangible assets 1.5 1.0 2.1
Property, plant and equipment 314.7 413.9 383.1
Other non-current assets 5.0 7.5 7.4
498.7 625.5 570.1
Current assets
Inventories 2.5 3.4 2.6
Trade and other receivables 7.1 33.0 13.0
Cash and cash equivalents 22.2 46.7 71.9
31.8 83.1 87.5
Assets classified as held for sale 8 124.1 15.5 33.4
155.9 98.6 120.9
Current liabilities
Trade and other payables (26.6) (44.1) (23.9)
Current tax liabilities (34.1) (24.6) (30.2)
Deferred income (0.5) - (0.6)
Obligations under finance leases - (0.1) -
Provisions (1.4) (0.7) (2.3)
(62.6) (69.5) (57.0)
Liabilities classified as held for 8 (24.6) (3.8) (12.2)
sale
(87.2) (73.3) (69.2)
Net current assets 68.7 25.3 51.7
Total assets less current liabilities 567.4 650.8 621.8
Non-current liabilities
Bank loans (134.3) (179.1) (179.2)
Deferred income (7.5) (8.7) (9.3)
Obligations under finance leases (5.5) (7.2) (5.6)
Provisions (4.6) (3.7) (5.5)
Deferred tax liabilities (39.6) (58.5) (43.9)
(191.5) (257.2) (243.5)
Net assets 375.9 393.6 378.3
Capital and reserves
Share capital 18.2 18.3 18.3
Share premium 60.9 60.9 60.9
Capital reserve 2.3 2.3 2.3
Capital redemption reserve 0.1 - -
Merger reserve 240.5 280.2 241.1
Equity reserve 0.6 0.4 0.5
Retained earnings 53.3 31.5 55.2
Shareholders' equity 375.9 393.6 378.3
Consolidated Cash Flow Statement (unaudited)
for the half year ended 31 August 2006
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
Note #m #m #m
Cash flows from operating activities
Net cash inflow from operations 9 28.8 33.2 74.1
Tax received - 5.5 7.1
Finance costs paid (4.5) (5.5) (11.1)
Cash flows from operating activities 24.3 33.2 70.1
Cash flows from investing activities
Purchase of property, plant and
equipment (25.6) (24.6) (56.4)
Purchase of intangible assets (0.3) - (0.8)
Net proceeds from sale of property,
plant and equipment 8.0 2.2 5.2
Proceeds from sale and leaseback of
property, plant and equipment - - 28.0
Costs associated with sale and
leaseback - (0.7) -
Acquisition of business - - (10.9)
Proceeds received on disposal of
business 0.9 22.3 24.5
Costs associated with disposal of
business - (2.0) (2.0)
Payment associated with surrender of
lease (1.6) - -
Interest received 0.9 1.5 2.6
Cash flows from investing activities (17.7) (1.3) (9.8)
Cash flows from financing activities
Repayment of long term borrowings (45.0) - -
Repayment of short term loan note - (0.9) (0.9)
Repayment of interest rate swap (0.5) - -
Repurchase of shares (2.4) - -
Dividends paid 5 (7.8) (7.1) (10.3)
Cash flow from financing activities (55.7) (8.0) (11.2)
Net (decrease) / increase in cash
and cash equivalents 9 (49.1) 23.9 49.1
Cash and cash equivalents at
beginning of period * 72.1 23.0 23.0
Cash and cash equivalents at end of
period * 23.0 46.9 72.1
* Cash and cash equivalents of #23.0m (1 September 2005: #46.9m, 2 March 2006:
#72.1m) include cash and cash equivalents presented within assets classified as
held for sale of #0.8m, (1 September 2005: #0.2m, 2 March 2006: #0.2m).
The movement in net debt in the period was analysed as follows:
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Decrease / (increase) in cash in the
period 49.1 (23.9) (49.1)
Non-cash changes - movement in finance
lease liabilities (0.2) 0.2 -
Cash outflow from repayment of finance (45.0) (0.9) (0.9)
Movement in net debt in the period 3.9 (24.6) (50.0)
Opening net debt 115.0 165.0 165.0
Closing net debt 118.9 140.4 115.0
Consolidated Statement of Changes in Shareholders' Equity (unaudited)
for the half year ended 31 August 2006
Share Share Capital Capital Merger Equity Retained Total
capital premium reserve redemption reserve reserve earnings
reserve
#m #m #m #m #m #m #m #m
Brought forward at 27
February 2005 18.3 60.9 2.3 - 280.2 0.3 25.0 387.0
Adjustment for
implementation of IAS 39 - - - - - - (0.5) (0.5)
Restated brought forward at
28 February 2005 18.3 60.9 2.3 - 280.2 0.3 24.5 386.5
Profit for the period - - - - - - 14.1 14.1
Share based payment expense - - - - - 0.1 - 0.1
Amounts attributable to
equity shareholders 18.3 60.9 2.3 - 280.2 0.4 38.6 400.7
Dividends paid (note 5) - - - - - - (7.1) (7.1)
Carried forward at 1
September 2005 18.3 60.9 2.3 - 280.2 0.4 31.5 393.6
Brought forward at 27
February 2005 18.3 60.9 2.3 - 280.2 0.3 25.0 387.0
Adjustment for
implementation of IAS 39 - - - - - - (0.5) (0.5)
Deferred tax impact on
adjustment for
implementation of IAS 39 - - - - - - 0.2 0.2
Restated brought forward at
28 February 2005 18.3 60.9 2.3 - 280.2 0.3 24.7 386.7
Profit for the year - - - - - - 1.7 1.7
Share based payment expense - - - - - 0.2 - 0.2
Amounts attributable to
equity shareholders 18.3 60.9 2.3 - 280.2 0.5 26.4 388.6
Dividends paid (note 5) - - - - - - (10.3) (10.3)
Transfer from merger
reserve - - - - (39.1) - 39.1 -
Carried forward at 2 March
2006 18.3 60.9 2.3 - 241.1 0.5 55.2 378.3
Brought forward at 3 March
2006 18.3 60.9 2.3 - 241.1 0.5 55.2 378.3
Profit for the period - - - - - - 7.7 7.7
Share based payment expense - - - - - 0.1 - 0.1
Share buy back (0.1) - - 0.1 - - (2.4) (2.4)
Amounts attributable to
equity shareholders 18.2 60.9 2.3 0.1 241.1 0.6 60.5 383.7
Dividends paid (note 5) - - - - - - (7.8) (7.8)
Transfer from merger
reserve - - - - (0.6) - 0.6 -
Carried forward at 31
August 2006 18.2 60.9 2.3 0.1 240.5 0.6 53.3 375.9
Notes to the Interim Financial Information
for the half year ended 31 August 2006
1 Basis of Preparation
The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards, (IFRS) as adopted by the European
Union and International Financial Reporting Interpretations Committee (IFRIC)
and with those parts of the Companies Act 1985 applicable to companies reporting
under IFRS. The accounting policies followed in this interim report are the
same as those published within the investors section of the Company's website,
www.luminar.co.uk.
IFRS currently in issue are subject to ongoing review and endorsement by the
European Commission, as well as possible amendment by the IASB, and therefore
are subject to possible change. Further standards or interpretations may also be
issued that could be applicable for the full year consolidated financial
statements. These potential changes could result in the need to change the basis
of accounting or presentation of certain financial information from that
presented in this document.
This interim report for the half year ended 31 August 2006 is unaudited and does
not constitute statutory financial statements as defined in section 240 of the
Companies Act 2005. Comparative annual figures for the year ended 2 March 2006
set out within this report have been extracted from the published Annual Report
2006. This report on which PricewaterhouseCoopers LLP gave an unqualified
opinion has been filed with the Registrar of Companies, as adjusted for changes
to the composition of discontinued operations as outlined in note 8.
2 Segmental Reporting
The Company is principally engaged as owner, developer and operator of theme
bars, nightclubs and restaurants in the United Kingdom.
For management purposes, the Company is now organised into two main business
segments - dancing and non-core operations. Non-Core operations combines the
retained units previously disclosed within the entertainment segment and the
units historically reported within the non-core segment.
Comparative income statement and cash flow information has been reclassified at
the balance sheet date to reflect the composition of the segments at these
dates. Segmental information about these businesses is presented below.
Half year ended 31 August 2006
Dancing Non-Core Corporate costs Consolidated
#m #m #m #m
Total revenue 90.1 9.3 - 99.4
Operating profit /
(loss) before
exceptional items 21.0 (1.1) (8.9) 11.0
Exceptional items (0.1) - (0.8) (0.9)
Segment result 20.9 (1.1) (9.7) 10.1
Net finance costs (3.4)
Profit before 6.7
taxation
Tax on continuing
operations
(2.1)
Profit for the period
from continuing
operations 4.6
Profit from
discontinued
operations before
exceptional items 0.8 10.3 (0.8) 10.3
Exceptional items - (3.2) - (3.2)
Profit / (loss) from
discontinued
operations before tax 0.8 7.1 (0.8) 7.1
Tax on discontinued
operations (4.0)
Profit from
discontinued
operations 3.1
Profit for the period 7.7
Half year ended 1 September 2005
Dancing Non-Core Corporate costs Consolidated
#m #m #m #m
Total revenue 83.2 12.6 - 95.8
Operating profit /
(loss) before
exceptional items 23.5 1.6 (9.7) 15.4
Exceptional items 8.0 (1.3) (2.5) 4.2
Segment result 31.5 0.3 (12.2) 19.6
Net finance costs (4.6)
Profit before 15.0
taxation
Tax on continuing
operations (3.1)
Profit for the
period from
continuing 11.9
operations
Profit from
discontinued
operations before
exceptional items 1.2 9.9 (0.8) 10.3
Exceptional items 0.5 (3.3) - (2.8)
Profit / (loss)
from discontinued
operations before
tax 1.7 6.6 (0.8) 7.5
Tax on discontinued
operations (5.3)
Profit from
discontinued
operations 2.2
Profit for the 14.1
period
Year ended 2 March 2006
Dancing Non-Core Corporate costs Consolidated
#m #m #m #m
Total revenue 176.7 24.7 - 201.4
Operating profit
before exceptional
items 51.1 2.1 (19.6) 33.6
Exceptional items 9.2 (20.6) (4.1) (15.5)
Segment result 60.3 (18.5) (23.7) 18.1
Net finance costs (8.5)
Profit before 9.6
taxation
Tax on continuing (1.9)
operations
Profit for the
period from
continuing 7.7
operations
Profit from
discontinued
operations before
exceptional items 0.8 21.4 (1.7) 20.5
Exceptional items 0.5 (30.6) - (30.1)
Profit / (loss) from
discontinued
operations before
tax 1.3 (9.2) (1.7) (9.6)
Tax on discontinued
operations 3.6
Loss from
discontinued
operations (6.0)
Profit for the year 1.7
3 Net Finance Costs
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Interest payable on bank borrowings (4.1) (5.3) (10.1)
Interest payable on obligations under (0.1) (0.1) (0.3)
finance leases
Amortisation of issue costs of bank loan (0.1) - (0.1)
Other interest payable - (0.2) (0.3)
Total borrowing costs (4.3) (5.6) (10.8)
Less amounts capitalised in the cost of
qualifying assets
- 0.1 0.2
Losses arising on derivatives - (0.6) (0.5)
Finance costs (4.3) (6.1) (11.1)
Income on bank deposits 0.9 0.7 1.8
Other interest - 0.8 0.8
Interest receivable 0.9 1.5 2.6
Finance costs - net (3.4) (4.6) (8.5)
4 Taxation
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Current tax
Continuing operations:
- Current period (2.1) (4.9) (7.3)
- Adjustments from prior periods - - 0.6
Discontinued operations:
- Current period (1.8) (2.4) (5.0)
- Adjustments from prior periods - - 0.5
(3.9) (7.3) (11.2)
Deferred tax
- Continuing operations - 1.8 4.8
- Discontinued operations (2.2) (2.9) 8.1
(2.2) (1.1) 12.9
Total taxation (charge)/ credit
Continuing operations (2.1) (3.1) (1.9)
Discontinued operations (4.0) (5.3) 3.6
(6.1) (8.4) 1.7
5 Dividends
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Ordinary shares - final dividend
paid: 10.74p per share (1 September
2005 and 2 March 2006: 9.76p per
share) 7.8 7.1 7.1
Ordinary shares - interim dividend
paid: nil p per share (2 March 2006:
4.44p per share) - - 3.2
7.8 7.1 10.3
In addition, the directors are proposing an interim dividend in respect of the
financial year ending 1 March 2007 of 4.88p per share which will absorb an
estimated #3.5m of shareholders' funds. It is proposed that it will be paid on
5 January 2007 for shareholders on the register as at 8 December 2006. This has
not been included as a liability within these financial statements in accordance
with IAS 10, Events after the balance sheet date.
6 Earnings Per Share
The calculation of the basic earnings per share (EPS) is calculated by dividing
the earnings attributed to ordinary shareholders by the weighted average number
of shares in issue during the period. For diluted earnings per share the
weighted average number of ordinary shares in issue is adjusted to assume
conversion of all dilutive potential ordinary shares. The Company has two
classes of dilutive potential ordinary shares: share options granted to
Directors and employees where the exercise price is less than the average market
price of the Company's ordinary shares during the year, and the contingently
issuable shares under the Company's long-term incentive plan (i.e. the Deferred
Bonus Plan).
An alternative measure of earnings per share from continuing operations
pre-exceptional items has been included below as the Directors believe that this
measure of earnings per share is more reflective of the on-going trading of the
Company.
Reconciliation of the earnings and weighted average number of shares used in the
calculations are set out below.
Half year ended 31 August 2006
Earnings Weighted Per share amount
average number
of shares
(in millions) (pence)
#m
Basic EPS
Earnings attributable to ordinary 7.7 72.9 10.6p
shareholders
Effect of dilutive securities - - 0.1 -
options
Diluted EPS 7.7 73.0 10.5p
Basic EPS from continuing operations 4.6 72.9 6.3p
Diluted EPS from continuing 4.6 73.0 6.3p
operations
Basic EPS from discontinued 3.1 72.9 4.3p
operations
Diluted EPS from discontinued 3.1 73.0 4.2p
operations
EPS from continuing operations
pre-exceptional items
Basic EPS from continuing operations
pre-exceptional items 5.5 72.9 7.5p
Diluted EPS from continuing
operations pre-exceptional items 5.5 73.0 7.5p
Half year ended 1 September 2005
Earnings Weighted Per share
average number
of shares amount
(in millions) (pence)
#m
Basic EPS
Earnings attributable to ordinary 14.1 73.2 19.3p
shareholders
Effect of dilutive securities - - 0.2 -
options
Diluted EPS 14.1 73.4 19.2p
Basic EPS from continuing operations 11.9 73.2 16.3p
Diluted EPS from continuing 11.9 73.4 16.2p
operations
Basic EPS from discontinued 2.2 73.2 3.0p
operations
Diluted EPS from discontinued 2.2 73.4 3.0p
operations
EPS from continuing operations
pre-exceptional items
Basic EPS from continuing operations
pre-exceptional items 7.7 73.2 10.5p
Diluted EPS from continuing
operations pre-exceptional items 7.7 73.4 10.5p
Year ended 2 March 2006
Earnings Weighted Per share
average number
of shares amount
(in millions) (pence)
#m
Basic EPS
Earnings attributable to ordinary 1.7 73.2 2.3p
shareholders
Effect of dilutive securities - - 0.1 -
options
Diluted EPS 1.7 73.3 2.3p
Basic EPS from continuing operations 7.7 73.2 10.5p
Diluted EPS from continuing 7.7 73.3 10.5p
operations
Basic EPS from discontinued (6.0) 73.2 (8.2p)
operations
Diluted EPS from discontinued (6.0) 73.3 (8.2p)
operations
EPS from continuing operations
pre-exceptional items
Basic EPS from continuing operations
pre-exceptional items 17.8 73.2 24.3p
Diluted EPS from continuing
operations pre-exceptional items 17.8 73.3 24.3p
7 Exceptional Items
(a) Continuing operations
The Company incurred exceptional items on continuing operations as follows:
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Exceptional items relating to
trading units
Impairment of property, plant and
equipment
- on trading units - - (0.1)
Reversal of prior years
impairment of property, plant and
equipment - 2.6 8.9
Impairment of goodwill - - (17.5)
Reversal of provision for onerous
lease commitments - - 0.7
Profit on sale and leaseback of
property, plant and equipment - 5.4 7.7
Costs relating to reorganisation
and rationalisation (0.9) (0.3) (0.6)
(0.9) 7.7 (0.9)
Exceptional items relating to
closure of properties
Impairment of property, plant and
equipment
- on closed units - (1.3) (8.2)
- on head office property - (2.2) (3.1)
Provision for onerous lease - - (3.3)
commitments
- (3.5) (14.6)
Pre-tax exceptional items
relating to continuing operations
(0.9) 4.2 (15.5)
Tax on exceptional items - - 5.4
Exceptional items relating to
continuing operations (0.9) 4.2 (10.1)
(i) Exceptional items relating to trading units
Costs of reorganisation and rationalisation of #0.9m, (half year ended 1
September 2005: #0.3m, year ended 2 March 2006: #0.6m), have been incurred in
respect of the relocation and back-office rationalisation of the Company's
administration centres.
The reversal of prior years impairment charges of #8.9m in the year ended 2
March 2006, (half year ended 1 September 2005: #2.6m), arose as the trigger
causing the original impairment to be recognised has reversed, e.g. where it is
now planned to re-brand a unit.
The impairment of goodwill of #17.5m in the year ended 2 March 2006 was recorded
following the annual impairment test required by IFRS 3, Business Combinations.
The impairment was recognised against goodwill allocated to the previously
reported Entertainment and Non-Core divisions, as a result of a decline in the
performance of the Entertainment division, specifically Jumpin Jaks units, and
non-core units still trading pending their ultimate disposal.
During the year ended 2 March 2006, the Company realised profits of #7.7m, (half
year ended 1 September 2005: #5.4m) on the sale and leaseback of three sites
(Hemel Hempstead, the Milton Keynes head office and Bury St Edmunds), for a
total consideration of #28.0m, received in cash.
(ii) Exceptional items relating to closure of properties
In the year ended 2 March 2006, an impairment of property, plant and equipment
of #8.2m (half year ended 1 September 2005: #1.3m) arose following the closure
of units in the non-core segment pending their ultimate disposal. An additional
charge was incurred in the year ended 2 March 2006 of #3.1m (half year ended 1
September 2005: #2.2m) from the re-measurement to the fair value less costs of
sale of the Company's former administration centres following the relocation of
the head office to Milton Keynes. During the period, the former head office
premises were sold, for a consideration of #0.9m.
During the year ended 2 March 2006, charges arising from onerous lease
commitments of #3.3m were made to recognise the obligation for rent and rates on
vacant or closed units, where the likelihood of assignment of the lease or
sub-let of the property was unlikely in the short term. These units were closed
or vacant following the relocation of the Company's administration centres and
the closure of non-core sites not suitable for re-branding.
(b) Discontinued operations
The Company incurred exceptional items relating to discontinued operations as
follows:
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Impairment of property, plant and equipment (1.1) (1.7) (12.8)
Reversal of prior years impairment of
property, plant and equipment - 0.5 3.1
Impairment of goodwill - - (16.2)
(1.1) (1.2) (25.9)
Provision for onerous lease commitments (0.9) - (3.6)
Reversal of provision for onerous lease
commitments 0.3 - 1.1
Realised loss on disposal of the Enterprise - (2.1) (3.0)
division
Realised profit on disposals 0.1 1.7 3.2
Other costs associated with disposals (1.5) - -
Costs relating to reorganisation and
rationalisation (0.1) (1.2) (1.9)
Pre-tax exceptional items relating to
discontinued operations (3.2) (2.8) (30.1)
Tax on exceptional items (0.7) - 8.9
Exceptional items relating to discontinued
operations (3.9) (2.8) (21.2)
The impairment of property, plant and equipment of #1.1m (half year ended 1
September 2005: #1.7m, year ended 2 March 2006: #12.8m) has resulted from
re-measuring units held for sale to fair value less costs of sale. In the year
ended 2 March 2006, #3.1m of prior years impairments were reversed (half year
ended 1 September 2005: #0.5m) as a result from the upward re-measurement of
units held for sale to the extent of previously recognised impairment charges.
The impairment of goodwill of #16.2m in the year ended 2 March 2006 arose as a
result of re-measuring the units held for sale that were previously reported
within the Entertainment division and Non-Core Division to their fair value less
costs of sale.
The provision for onerous lease commitments of #0.9m (year ended 2 March 2006:
#3.6m), relating to sites presented within discontinued operations, has arisen
from the closure of sites following the decision to exit from non-core
operations. The reversal of a previously recognised provision of #0.3m (year
ended 2 March 2006: #1.1m) has arisen as a result of an offer for a unit held
for sale, which would negate the need for a provision.
In the prior year, an exceptional loss on disposal of the Enterprise division,
#3.0m, (half year ended 1 September 2005: #2.1m), was recognised on completion
of its sale.
A profit of #0.1m was made during the period (half year ended 1 September 2005:
#1.7m, year ended 2 March 2006: #3.2m), on disposal of 7 single sites, for
consideration of #3.7m, all of which has been received in cash during the half
year. Other costs of #1.5m have been incurred in relation to these disposals.
Costs of reorganisation and rationalisation of #0.1m, (half year ended 1
September 2005: #1.2m, year ended 2 March 2006: #1.9m), have been incurred in
respect of the relocation and back-office rationalisation of the Company's
administration centres.
8 Discontinued operations and units held for sale
(a) Results of discontinued operations
Comparative income statement and cash flow information is restated at each
balance sheet date to reflect the composition of discontinued operations at the
latest balance sheet date.
During the half year ended 31 August 2006, 64 of the 72 units previously
reported within the Entertainment division have been packaged for disposal.
Since this disposal constitutes a major line of business, which is part of a
single co-ordinated plan to dispose of such a business, these units were
reported within discontinued operations, and the comparatives restated
accordingly.
The results of discontinued operations, including the 64 units mentioned above
and the non-core units (including the Enterprise units), which were either held
for sale or disposed of as at 31 August 2006, were included within the
consolidated income statement as follows:
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Revenue 51.2 75.6 136.8
Expenses (40.8) (65.2) (116.2)
Finance costs (0.1) (0.1) (0.1)
Profit before tax 10.3 10.3 20.5
Attributable tax expenses (3.3) (5.3) (5.3)
Profit after tax before exceptional items 7.0 5.0 15.2
Exceptional items:
Re-measurement to held for sale (see note 7) (1.1) (1.2) (25.9)
Loss on disposal of the Enterprise division
(see note 7) - (2.1) (3.0)
Other exceptional items (see note 7) (2.1) 0.5 (1.2)
Attributable tax (expenses) / credits (0.7) - 8.9
Net profit / (loss) attributable to
discontinued operations 3.1 2.2 (6.0)
(b) Assets and liabilities of units held for sale
At 31 August 2006, 111 units were classified as held for sale, of which 106 were
within the Non-Core division and 5 units were within the Dancing Division.
84 of the units held for sale were included in the disposal package of the
previously reported Entertainment Division, and 4 units have been
unconditionally exchanged but have an agreed completion date of August 2007.
Since the period end, 1 unit has been surrendered to the landlord, 1 unit has
been conditionally exchanged and a further 3 units are with the lawyers for
disposal in the next few months. The remaining 18 units were actively being
marketed at the balance sheet date and informal offers had been received against
some of these units.
A net charge of #1.1m (1 September 2005: #1.2m, 2 March 2006: #25.9m) has been
recognised on re-measurement of units held for sale to fair value less costs of
sale.
The major classes of assets and liabilities comprising the units classified as
held for sale were as follows:
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Other intangible assets 0.2 - -
Property, plant and equipment 117.0 14.6 30.5
Other non-current assets 2.3 - -
Inventories 1.1 0.3 1.4
Trade and other receivables 2.7 0.4 1.3
Cash and cash equivalents 0.8 0.2 0.2
Total assets classified as held for sale 124.1 15.5 33.4
Trade and other payables (11.2) (1.8) (6.4)
Finance lease obligations (1.4) - (1.5)
Deferred income (2.1) (0.5) (0.6)
Deferred tax (6.5) 0.5 -
Provisions (3.4) (2.0) (3.7)
Total liabilities classified as held for sale (24.6) (3.8) (12.2)
Net assets held for sale 99.5 11.7 21.2
9 Cash flow from operating activities and net debt
Half year ended Half year ended Year ended
31 August 2006 1 September 2005 2 March 2006
#m #m #m
Profit before taxation - continuing 6.7 15.0 9.6
operations
Profit / (loss) before taxation -
discontinued operations 7.1 7.5 (9.6)
13.8 22.5 -
Outflows relating to exceptional cash 2.4 1.1 2.3
items
Profit before taxation before exceptional
cash items 16.2 23.6 2.3
Depreciation and amortisation 10.5 16.7 32.9
Net impairment of property, plant and
equipment 1.1 2.1 12.2
Impairment of goodwill - - 33.7
Costs of reorganisation and 0.1 - -
rationalisation
Profit on sale of property, plant and (0.1) (2.3) (3.2)
equipment
Loss on disposal of intangible assets 0.2 - -
Profit on sale and leaseback - (5.4) (7.7)
Loss on disposal of subsidiary - 2.1 3.0
undertakings
Net finance costs 3.5 4.7 8.6
31.5 41.5 81.8
Decrease / (increase) in inventories 0.4 (0.4) (0.1)
(Increase) in receivables (1.1) (3.8) (3.3)
Increase / (decrease) in trade and other
payables 0.9 (2.6) (2.8)
(Decrease) / increase in provisions (0.5) (0.4) 4.8
Net cash inflow from operations before
exceptional cash flow items 31.2 34.3 80.4
Outflows relating to exceptional cash (2.4) (1.1) (6.3)
items
Net cash inflow from operations 28.8 33.2 74.1
Cash outflows relating to exceptional items relate to costs associated with
disposals of #1.5m and costs of reorganisation and rationalisation of #0.9m. In
the year ended 2 March 2006, #4.0m of the #6.3m cash outflows relating to
exceptional items were incurred as a result of a VAT payment following
assessment by HM Revenue and Customs, against which the Company is currently in
the process of appealing. This was included within trade and other payables at
27 February 2005.
Appendix 1: Unit reconciliation
The table below reconciles the units reported as at 2 March 2006 to those
reported as at 31 August 2006:
2 March 2006 31 August 2006
Segments Total units * Transfers ** Disposals Total units *
Branded 43 2 45
Unbranded 67 -13 54
Dancing 110 -11 - 99
Entertainment 79 -6 -1 72
Non-Core 41 10 -7 44
230 -7 -8 215
* The units presented above exclude those units which are closed for development
or have been sub-let
** Net transfers relate to 4 units which have been collapsed from 2 trading
units into 1, and 3 units which have been closed for development
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DBBDBXXBGGLS
Luminar Group (LSE:LMR)
Historical Stock Chart
From Jun 2024 to Jul 2024
Luminar Group (LSE:LMR)
Historical Stock Chart
From Jul 2023 to Jul 2024
