RNS No 5834t
OASIS STORES PLC
6th April 1998
Contacts: Michael Bennett, Chairman
Dominic Lavelle, Finance Director
Oasis Stores Plc Tel: 0171 452 1000
Tom Baldock
Financial Dynamics Tel: 0171 831 3113
OASIS STORES PLC
Preliminary Results Announcement
Oasis Stores Plc, the design-led fashion retailer today announces its
results for the 53 weeks ended 31st January 1998.
Summary:
* Sales up 14% to #92.9m (1997: #81.7m). Like-for-like sales flat
* Pre-tax profits down 33% to #10.4m (1997: #15.6m)
* Earnings per share decreased to 13.12p (1997: 19.51p)
* Dividend up 7% to 7.5p (1997: 7.0p)
* Total number of outlets increased from 108 to 127; 1 new store opened
since year end
* Partnership signed with Grattan for launch of Mail Order in Autumn 1998
* Opening of first accessories store in Manchester
Commenting on the results, Chairman Michael Bennett said:
"1997 was a difficult year for Oasis. Following 5 years of exceptional
growth and profitability, we experienced some operational problems which
contributed to a lower level of profits than in the previous year. However,
these problems have now been dealt with and I am fully confident that the
continuing strength of the Oasis brand and the commitment of our management
team will return the Company to profitable growth in 1998.
Total sales were up 7% and like-for-like sales were down 3% in the first 7
weeks of the current year. These figures compare to a corresponding strong
period in 1997 and trading is on an improving trend."
CHAIRMAN'S STATEMENT
AND FINANCIAL REVIEW
Financial Highlights
1997 was undoubtedly a very challenging year for Oasis and this is reflected
in the Company's financial performance for the 53 weeks to 31st January
1998. Turnover increased by 14% to #92.9 million (1997: #81.7 million) and
retail sales were up 12% to #88.9 million (1997: #79.4 million). However,
like-for-like sales were flat overall. Pre-tax profits declined by 33% to
#10.4 million (1997: #15.6 million) and earnings per share decreased to
13.12 pence from 19.51 pence. A final dividend of 5.1 pence per share will
be paid in June giving a total dividend for the year of 7.5 pence (1997: 7.0
pence), an increase of 7%. This reflects our confidence in the long term
prospects for Oasis with its strong brand name and successful format.
A total of #8.3 million (1997: #5.9 million) was invested in the period, or
#7.8 million on a cash basis. At the year-end the Company had net cash
balances of #7.1 million (1997: #13.1 million), representing 29% of net
assets.
Operational Summary
Undoubtedly Oasis' profit performance for the year was a disappointment to
us all. Growth has brought with it challenges. Managing change,
maintaining flexibility, meeting increased competition and developing
leading edge systems, have all imposed some strains.
The disappointing result was due to several factors: a slow-down in sales,
particularly in the UK, higher markdowns and an increase in distribution and
administrative costs. Although retail sales increased by 12%, retail gross
profit only grew by 3%, from #44.4 million to #45.7 million. Our retail
gross profit rate declined from 56.0% to 51.4%.
However, much was achieved during the year to stand us in good stead for the
future.
We opened 23 new stores in the period, including two relocations into larger
premises, and two other stores were closed giving a net increase of 19 in
the number of outlets. In the last two years we have opened 50 outlets on a
base of 82 in January 1996. Trading square footage at the end of the period
was 159,000, or 20% higher than last year (133,000). Average trading square
footage was 148,000, or 23% higher than last year. The 23 new stores cost
#3.6 million and #1.9 million was spent refurbishing existing stores.
Despite signs of overheating in the property market, the new shops and
concessions we opened were on terms that allow us to trade profitably. We
also opened our first accessory shop and trading so far has been
encouraging. We continued our rolling programme of refurbishing the branches
and concessions with 21 shops receiving a major investment.
Our Buying Department was restructured during the year and this, combined
with our new merchandise control and planning systems should significantly
improve the performance of this critical department.
We also increased our spending on training through new initiatives and
although we recognise this is an investment in the future, we plan further
growth in this area.
The work and investment to ensure the successful launch of our Mail Order
partnership with Grattan was completed during the year and we should start
to see the benefits from the Autumn onwards.
One of our core strengths is the Company culture, which remained strong in
spite of the strains of a difficult year. The team spirit, the sharing of
the challenges and the dedication to a common cause remained undiminished
and everyone made their contribution to the team effort.
United Kingdom
Like-for-like sales fell by 1%, but overall sales grew by 10%, from #72.8
million to #80.3 million. We opened 16 new stores, comprising 8 new
branches, two relocated branches, our first accessory store and 5 new
concessions, including our first outlet in Northern Ireland. We closed
another branch and a concession, resulting in a net increase in UK outlets
of 12, from 93 to 105.
Republic of Ireland
This market continued its steady growth, with like-for-like sales increasing
by 10%, and overall sales up 16% to #5.9 million. One new store opened in
the second half, increasing the number of stores to 6.
Germany
Overall sales grew by 80% to #2.7 million driven by the 6 new concessions
which were opened during the period and the 8 new stores which opened during
1996. The weak economy in Germany continued to impact on our trade and the
strength of the pound on our results. However, we remain optimistic about
the potential of the Oasis brand and format in Germany.
Licensees
In the period, sales to licensees represented 4.3% of sales, up from 2.8%
last year. Sales grew by 76% to #4.0 million from #2.3 million. New store
openings totalled 9 in the period, including first stores in Iceland,
Portugal, Qatar and 3 in Taiwan. We have also finally found an excellent
licensee for Japan.
Systems
During last year our new EPOS system was introduced and this will
undoubtedly improve the speed and quality of the two-way communication with
our shops, free up management time and improve service to our customers.
By year end 33 branches were using the system. All branches will be linked
by the end of August.
Our new merchandise control and planning systems were installed in the
latter part of the year and although the system requires further development
this technology will help us strengthen our competitive edge and prove an
invaluable tool in our planning to ensure maximisation of our returns on
stock.
Expenditure on new computer systems was #2.4 million (1997: #0.6 million),
the new EPOS system represented #1.9 million of this amount and other system
enhancements cost #0.5 million, mainly on the new merchandising and
distribution systems.
Outlook
For the current year we have acquired 5 new branches and negotiations are in
their final stages on a sixth. We will also be opening another four
concessions and have plans to open additional accessories stores in the UK.
However, in the light of current retail property prices, it should be noted
that our policy remains to open stores only on terms that allow us to
achieve targeted returns.
I believe our trading performance is now on an improving trend. Although
sales in the first 7 weeks of the year are down 3% on a like-for-like basis,
this compares to a strong period in the previous year and this performance
is in line with our expectations.
Our shops are looking good and the product is being well received. We have
all been strengthened by the difficulties we encountered during 1997 and
looking to the future I feel confident in the fundamental strengths of the
business.
Profit and Loss Account
for the 53 weeks ended 31st January 1998
1998 1997
#'000 #'000
Turnover 92,936 81,651
Cost of sales (46,665) (36,828)
Gross profit 46,271 44,823
Distribution costs (30,739) (24,900)
Administrative expenses (6,828) (5,693)
Other operating income 43 95
Operating profit 8,747 14,325
Interest receivable and similar income 1,624 1,308
Interest payable and similar charges (8) (20)
Profit on ordinary activities before
taxation 10,363 15,613
Taxation (3,479) (5,376)
Profit for the financial period 6,884 10,237
Dividend (3,934) (3,672)
Retained profit for the financial period 2,950 6,565
1998 1997
pence pence
Earnings per share 13.12 19.51
Other than the profit for the period, which was entirely derived from
continuing activities, there were no recognised gains or losses during the
current and previous period.
Balance Sheet
as at 31st January 1998
1998 1997
#'000 #'000
Fixed assets
Tangible fixed assets 16,818 12,750
Current assets
Stocks 9,850 8,093
Debtors 4,870 3,912
Short term deposits and cash 7,130 13,142
21,850 25,147
Creditors
Amounts falling due within one year (13,213) (15,407)
Net current assets 8,637 9,740
Total assets less current liabilities 25,455 22,490
Creditors
Amounts falling due after more than one
year (209) (217)
Provisions for liabilities and charges (337) (314)
Net assets 24,909 21,959
Capital and reserves
Called up share capital 5,246 5,246
Profit and loss account 19,663 16,713
Equity shareholders' funds 24,909 21,959
Cash Flow Statement
for the period ended 31st January 1998
1998 1997
#'000 #'000
Net cash inflow from operating activities 9,390 16,936
Returns on investments and servicing of
finance
Interest received 1,625 1,318
Interest paid (10) (20)
Net cash inflow from returns on investments
and servicing of finance 1,615 1,298
Tax paid (5,612) (4,101)
Capital expenditure
Purchase of tangible fixed assets (7,795) (5,880)
Sale of tangible fixed assets 219 40
Net cash outflow from capital expenditure (7,576) (5,840)
Equity dividends paid (3,829) (2,849)
(Decrease)/increase in cash (6,012) 5,444
Notes
1. TURNOVER AND PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION
Turnover arises from the sales by the Company to third parties net of
discounts and value added tax and royalty income received from overseas
licensees.
1998 1997
#'000 #'000
Geographical analysis
Turnover
United Kingdom 80,308 72,786
Ireland 5,891 5,072
Germany 2,719 1,513
Rest of Europe, Middle and Far East 4,018 2,280
92,936 81,651
Turnover by country of destination is not materially different from turnover
by country of operation.
Turnover arises entirely from fashion retailing and may also be analysed as
follows:
Turnover:
European retailing 88,918 79,371
Overseas licensing 4,018 2,280
92,936 81,651
Net profit before unallocated net expenses:
European retailing 15,002 19,524
Overseas licensing 530 399
15,532 19,923
Unallocated net expenses (6,785) (5,598)
Operating profit 8,747 14,325
The Company operates principally within the UK; the Directors consider that
the level of net assets held overseas is immaterial.
2. CASH FLOW STATEMENT
1998 1997
#'000 #'000
Reconciliation of operating profit to net cash
inflow from operating activities
Operating profit 8,747 14,325
Depreciation charges 3,943 2,736
Loss on sale of fixed assets 119 96
(Increase) in stocks (1,757) (2,940)
Decrease in investments 0 391
(Increase) in debtors (933) (938)
(Decrease)/increase in creditors (729) 3,266
Net cash inflow from operating activities 9,390 16,936
3. The Directors recommend that a final dividend of 5.10 per share (1997 -
4.90p), which added to the interim dividend of 2.40 pence (1997 - 2.10p),
gives a total dividend payable for the year of 7.50 pence per share (1997 -
7.00p). The final dividend will be paid on 22nd June 1998 to shareholders
whose names appear on the Register of Members at the close of business on
15th May 1998. The Seventh Annual General Meeting of Oasis Stores Plc will
be held at the offices of SG Securities (London) Ltd, Exchange House,
Primrose Street, London EC2A 2DD on Tuesday 2nd June 1998, at 10.00am.
Copies of the Annual Report & Accounts will be sent to shareholders in due
course and additional copies will be available from the Company's registered
office: 13-16 Lakeside, Stanton Harcourt, Witney, Oxon OX8 1SL.
4. FINANCIAL STATEMENTS
The financial information for the fifty three weeks ended 31st January, 1998
is unaudited and does not constitute full accounts within the meaning of
Section 240 of the Companies Act 1985. The financial information for the
fifty two weeks ended 25th January, 1997 has been extracted from the full
accounts for that period which have been delivered to the Registrar of
Companies and on which the auditors have issued an unqualified audit report.
5. EARNINGS PER SHARE
The calculation of earnings per share is based on the profit on ordinary
activities after taxation of #6,884,000 (1997 - #10,237,000) and a weighted
average of 52,457,175 ordinary shares in issue during the year (1997 -
52,457,175).
END
FR NFXLDEDAPEFN
Oasis Stores (LSE:OAS)
Historical Stock Chart
From Jul 2024 to Jul 2024
Oasis Stores (LSE:OAS)
Historical Stock Chart
From Jul 2023 to Jul 2024
