TIDMSTA
RNS Number : 8860W
Stagecoach Theatre Arts PLC
05 August 2009
5 August 2009
Stagecoach Theatre Arts plc (AIM: STA)
("Stagecoach" or "the Group")
Preliminary Announcement of Results
for the year ended 31 May 2009
"Stagecoach Theatre Arts plc operates the UK's largest franchise network of
part-time performing arts schools for children aged between 4 and 18"
"ANOTHER VERY GOOD YEAR FOR STAGECOACH THEATRE ARTS"
Highlights:
Financial
* Profit before tax up 3 per cent to GBP0.73m (2008: GBP0.71m).
* Franchise network fees up 3.2 per cent to GBP29.4m (2008: GBP28.5m) reflecting
the continuing solid performance of franchisees worldwide.
* Healthy cash balance at year end increased slightly to GBP1.04m (2008:
GBP1.03m).
* Earnings per share up by 4 per cent to 5.3 pence (2008: 5.1 pence).
* Total dividends for the year up 25 per cent to 2.5 pence per share following a
proposed final dividend of 2.0 pence per share (2008: 2.0p).
* Current dividend yield of 4.8 per cent (based on a mid-market share price of
52.5 pence as at the close of business on 4 August 2009).
Operations
* Key objective over the past two years has been to bring each part of business to
profitability:
* Stagecoach USA pleasingly moved into profit this year.
* Stagecoach UK continues to provide the majority of Group's profits, with
SportsCoach, the Montessori nursery school and Other International all
contributing a profit.
* Stagecoach Germany's operating losses further reduced; with a move into
operating profitability planned for year ending 31 May 2011 with new franchise
sales and school openings.
* International licence agreement format for expansion overseas showing positive
signs of success in both Greece and Canada - the Board expects that future
growth can be achieved through more international licence agreements:
* In September 2008, the first Stagecoach school in Athens, Greece was
launched with a second school opened in Athens in April. A third school is due
to open in Piraeus this September.
* Option agreement signed in May for Stagecoach schools in Hong Kong.
* Stagecoach Canada performing well.
David Sprigg, Managing Director, commented:
"As for most companies, this has been a challenging year during this difficult
economic climate. However, the effects of the recession have had a minimal
impact on the sales and profitability of the business this year, demonstrating
once again the popularity of our Stagecoach Theatre Arts schools training and
education and the resilience of the business model.
The credit crunch has hampered both UK and overseas school openings, and this is
likely to continue into next year. However, there remain significant medium-term
growth prospects in the UK and considerable long-term growth potential for
SportsCoach, Stagecoach Germany and USA, as well as other new overseas
territories."
ENDS
Enquiries:
+-----------------------------------------------+--------------------------------+
| Stagecoach Theatre Arts | Tel: 01932 254 333 / 07775 643 |
| Richard Dawson, Finance Director and Head of | 939 |
| Investor Relations | rdawson@stagecoach.co.uk |
| | www.stagecoach.co.uk |
| | |
+-----------------------------------------------+--------------------------------+
| | |
+-----------------------------------------------+--------------------------------+
| Smith & Williamson Corporate Finance Limited | Tel: 020 7131 4000 |
| Nominated Adviser & Joint Broker | |
| David Jones / Barrie Newton/ Charles Combe | |
+-----------------------------------------------+--------------------------------+
| Daniel Stewart & Company plc | Tel: 020 7776 6550 |
| Joint Broker | |
| Paul Shackleton | |
+-----------------------------------------------+--------------------------------+
| Peckwater PR | Tel: 07879 458 364 |
+-----------------------------------------------+--------------------------------+
| Tarquin Edwards | tarquinedwards@btinternet.com |
+-----------------------------------------------+--------------------------------+
Chairman's Statement
Overview
The Stagecoach Group reports a 3% increase in profit before tax to GBP726,000
for the year to 31 May 2009 (2008: GBP707,000), and a 4% increase in earnings
per share at 5.3 pence (2008: 5.1 pence).
This has been another good year for Stagecoach Theatre Arts, particularly in
light of the difficult economic climate throughout the year. Despite a small
decline in worldwide student numbers due to the recession, network fees
increased by 3% to GBP29.4 million (2008: GBP28.5 million). Network fees reflect
total school fees earned over the year by our franchisees from the 38,900
students (2008: 40,600) that attend Stagecoach and SportsCoach worldwide.
We propose a final dividend of 2 pence per share, which together with the
payment of the maiden interim dividend of 0.5 pence per share in February,
represents an overall 25% increase on the dividend paid last year and endorses
the strength and future prospects of the business.
Strategy
The key objective over the past two years has been to bring each part of our
business to profitability, and we are pleased that our Stagecoach USA subsidiary
moved into profit this year. Stagecoach UK continues to provide the majority of
profits, with SportsCoach, the Montessori nursery school and Other International
Schools each contributing a profit. Stagecoach Germany's operating losses
further reduced this year as it continues to expand its network.
This year also sees the full year benefits of the cost cutting exercise
undertaken in recent years, where we have sought to reduce overheads where
possible, including staff, premises and other costs. The reduction in
administrative expenses has enabled us to report an increase in profitability.
We continue to support the Stagecoach Charitable Trust, which runs InterAct
Theatre Workshops, providing inclusive performing arts tuition to children of
all abilities and needs.
Employees
I wish to express my thanks to all our employees for their commitment and
contribution throughout the year, all of which has helped to deliver this
pleasing performance.
Prospects
We remain confident, based on our experience from the previous recession and
this recession to date, that children's education tends to be one of the last
items of expenditure cut from the family budget. However, large scale
redundancies in particular areas in the UK have affected individual schools in
those regions and the effect of this recession may be felt further during our
next financial year.
Once we come out of the recession, we are likely to see an increase in
subsequent school openings and a boost in initial fees from school re-sales
owing to pent up demand for transfers as some existing franchisees look towards
retirement. We also remain optimistic of long-term growth in SportsCoach and our
German and US-based operations, and we are in negotiation for licences in other
countries. I am pleased with the way the Stagecoach Group has performed in these
tough economic times and I congratulate the Group's executive team on their
dedication and in delivering profitable growth.
Graham Cole
Chairman
5 August 2009
Operating Review
Group Overview
We are pleased with the overall performance of the Group this year, particularly
during these difficult economic times. Our student numbers have proved to be
comparatively resilient to the slowdown in consumer spending, and despite a 4%
drop in student numbers the network is still averaging over 90% occupancy.
The Directors believe that once we are past the current recession, Stagecoach's
strong position and brand awareness in its markets, allied to its franchise
model, offer significant growth potential for the business.
Stagecoach Theatre Arts UK
This is the first year since the business was founded 21 years ago that we have
not seen an increase in Stagecoach UK school numbers and students. During the
year 17 new Stagecoach schools opened; however 21 schools closed or merged with
other schools, giving a net decrease of four schools. Encouragingly there was
still growth in the Early Stages classes with net nine new classes opened during
the year. These Early Stages classes provide an important stream of new students
to the main schools for future years.
The number of Stagecoach Theatre Arts main schools for 6 to 16 year olds in the
UK is 617 schools with 25,574 students attending (2008: 621 schools and 26,554
students). Early Stages classes, providing performing arts tuition to younger
students aged 4 to 6 years, increased to 707 classes in the UK with 9,254
students attending (2008: 698 Early Stages classes and 9,439 students). The
total number of students attending Stagecoach schools in the UK, including Early
Stages and Further Stages classes, decreased from 36,260 to 35,082 students.
The average number of students per main Stagecoach school at year end was 41.4
(2008: 42.8), thus, despite a fall in student numbers, the occupancy rate
throughout the network remains strong at 92% of all available places taken,
based on an optimum number of students per school of 45.
The average number of Stagecoach schools per franchisee is 2.3 schools,
demonstrating that there remains further significant growth potential in the
existing network as many franchisees operate three, four or five schools, and
still a number have yet to open a second school.
Our continuing success, particularly during these difficult times where we have
seen numerous smaller competitors cease trading, comes from maintaining the
highest standards of education, including regular unannounced school
inspections, regional franchisee meetings and franchisee and teacher training.
Parents receive progress reports twice a year and students receive medals for
longevity and participation. The skills students learn at Stagecoach help them
perform better in life.
The network continues to promote the benefits of Stagecoach Theatre Arts
training and education, and we have maintained our advertising budget across the
network both at an individual local school level and through national
advertising.
We have ceased offering Mini Stages as a separate franchise; instead Mini Stages
classes are now only operated by existing Stagecoach franchisees alongside an
established Stagecoach school. Consequently, at year-end, there were 4 Mini
Stages schools in the UK, from which 25 teaching sessions were held, and a total
of 244 students attending (2008: 11 schools, 55 sessions and 589 students).
Network fees for Mini Stages were GBP84,000 (2008: GBP142,000).
The Montessori nursery increased fees by 25% to GBP325,000 (2008: GBP259,000) as
a result of an increase in the average number of sessions attended by each
student. At year end there were 116 students registered at our Montessori
nursery (2008: 123 students).
From October 2008, Stagecoach Parties was offered as an additional activity for
our Stagecoach franchisees, to help with marketing, as well as to provide a
supplemental income. By year end 36 of our 268 Stagecoach franchisees have paid
us the initial set-up cost and annual licence fee for the rights to run
Stagecoach Parties. Stagecoach Parties are fun, structured parties for children
of all ages, predominantly run as children's birthday party activities, held
either at their home or in a local hired venue.
Stagecoach UK, including Mini Stages, the Montessori School and the Stagecoach
Agency, reported operating profits before overheads of GBP2.6m (2008: GBP2.7m).
After attributing all UK overheads Stagecoach UK profit before tax was
GBP715,000 (2008: GBP819,000).
Stagecoach Agency
The Stagecoach Agency maintains its status as the largest performing arts agency
for children in the UK and continues to provide our students with varied work
across all areas of the entertainment industry. Our 2009/10 intake has dropped
this year to 1,510 students (2008/09: 2,043 students). However, the total of
individual submissions for jobs for the year increased to over 20,000, resulting
in approximately 8,000 auditions and bookings.
The jobs have become more varied and high profile; and this year saw a
Stagecoach Agency first, in that every West End musical that has children in the
cast has featured at least one Stagecoach student. We are also raising our
profile in the lucrative Voice Over market, in which we excel because of our
unique nationwide pool of age related, regional and ethnic voices.
As the largest children's and young performers' agency in the UK, the Stagecoach
Agency has continued to expand its influence throughout the entertainment
industry. The Agency provides a comprehensive range of services to Casting
Directors and Production Companies who in turn offer Stagecoach students work
opportunities within a wide range of entertainment platforms. These include TV
and Film, Commercials and Corporate Videos, Theatre, Radio Dramas, Photo Shoots
and Promotions, Musicals and Voice-Overs.
Assignments won this year by the Agency include an 18 month national tour of
Chitty Chitty Bang Bang across the U.K and Ireland in which 1,000 Stagecoach
students have performed or will perform; Waterloo Road series 5 (our 5th
consecutive booking, providing all the background artists); Survivors series 2;
parts for students in most major television series and many other high-profile
productions, both domestic and international. Such credits include TV roles in
Waterloo Road 4, Prince of Persia, New Heroics, Outnumbered, East-Enders, Dr
Who, Lark Rise, Kevin Bishop Show, numerous Radio 4 dramas, BT, Morrisons,
Sainsburys, Law & Order, Miss Marple, Game of Thrones; and in theatre Dolls
House, National & European Tour of Thriller, Priscilla Queen of The Desert,
Waiting For Godot, Billy Elliot, Chitty Chitty Bang Bang, The Sound of Music,
Mary Poppins, Baby Girl, and Merry Wives of Windsor at The Globe. Voiceover
credits include Peppa Pig, Little Kingdom, Cbeebies, Radio, Tommy Zoom, and
Disney - Tigger, Pooh and Friends.
The Agency's continued success offers excellent publicity opportunities for
individual Stagecoach schools throughout the UK.
Creative and Educational Department
By working closely with our franchisees, the Group continues to provide the
highest standards of performing arts education and opportunity throughout the
Stagecoach network. The Creative and Educational Department is committed to
being at the forefront of standards of education in the performing arts.
Each year the Stagecoach network provides its students with opportunities to
participate in special performances and events. The events this year included:
- June 2008 and again in November 2008 - a total of 600 students from all over
the UK performed a selection of dance, drama and singing routines at Her
Majesty's Theatre in London's West End.
- June 2008 - a national choir festival at the Birmingham Symphony Hall featured
over 400 Stagecoach students from around the UK.
- the annual 'Easy Stages' show-case production of the musical Children of Eden
in August 2008 featured 70 Stagecoach students from the UK, Ireland, USA and
Germany.
- December 2008 - 66 Stagecoach schools from the UK, Ireland and Germany and an
estimated 5,000 Stagecoach students simultaneously performed a musical piece
entitled "Glad Rags", to set a new Guinness World Record beating our previous
record set in 1999.
- March to May 2009 - fifteen Stagecoach schools performed with Andy Abraham in
his UK tour.
The Stagecoach Foundation Course continues to be run twice yearly, with
significant workshop input from The Royal Academy of Dramatic Art ('R.A.D.A').
The course, designed with the particular needs of Stagecoach and part-time
theatre arts schools in mind, has accreditation from Trinity/Guildhall as part
of their A.T.C.L in Musical Theatre (Associate of Trinity College London).
Regional teacher training workshops offer Stagecoach teachers and franchisees
in-service development by leaders in the performing arts. Stagecoach's
training, together with these extra-curricular performing opportunities, offers
immense benefits to students in their growth of confidence and self-esteem as
well as fostering enjoyment and well being.
SportsCoach
Despite a small number of SportsCoach school closures this year we are now
reaping the benefits of the restructuring from last year with an increase in
profitability for the SportsCoach network. We are developing new marketing
strategies to recruit students to SportsCoach, appealing to all children
regardless of their sporting abilities. The majority of SportsCoach students are
not sporty, but benefit through sport both mentally and physically. The results
of these new marketing strategies tested on our local schools this Summer Term
2009 have shown early positive signs.
The SportsCoach network has 20 SportsCoach schools, 8 Early Sporties classes and
876 students (2008: 26 schools, 10 Early Sporties and 1,156 students). Average
student numbers per SportsCoach school for the Summer Term 2009 were 37.5
students (2008: 39.0 students).
Network fees of SportsCoach were GBP727,000 (2008: GBP835,000) and profit before
tax increased to GBP27,000 (2008: GBP11,000).
Overseas operations
The Group's overseas operations include wholly owned US and German subsidiaries,
each running Stagecoach Theatre Arts franchise networks, and Stagecoach schools
operated under licence or direct franchise agreement in Australia, Canada,
Gibraltar, Greece, Ireland, Malta and Spain.
USA and Germany
The restructuring of the US operations was completed in May 2008, and this year
represents the first full year since we closed our head office in Minnesota and
no longer directly employ any head office staff in the US. We have been able to
provide full support for our US franchisees from the UK whilst retaining a
self-employed part-time administrator in the US.
As a consequence, we are pleased to report a profit before tax for Stagecoach
USA of GBP14,000 (2008: loss GBP78,000).
One new US franchise school opened during the year in Portland, Oregon, in April
2009, and it was pleasing that the school opened with a full register of 45
students, which provides encouragement for more new school openings and
expansion of Stagecoach USA.
Stagecoach Germany continues to expand steadily and average student numbers per
school increased significantly by 15% to 42.5 from 36.8 last year. The credit
crunch over the past year has however hindered new sales and has slowed down the
anticipated rate of expansion of the German network. Stagecoach Germany
reported losses of GBP100,000 (2008: losses of GBP105,000). As we move out of
recession, and with franchisees trading at near full capacity we expect to see
an increase in new franchise sales and school openings taking Stagecoach Germany
to profitability within two years.
Between these two overseas markets, USA and Germany, at year end there were 16
franchisees, 27 Stagecoach schools, 25 Early Stages classes, 1 Further Stages
class and a total of 1,239 students (2008: 1,229 students).
Other overseas
In September 2008, the first Stagecoach school opened in Athens, Greece, under
an international licence agreement. The school opened with a full register and a
second school opened in Athens in April 2009. A third school is due to open in
Piraeus in September 2009.
The key to the success of the overseas operations has always been to identify
and secure the right calibre of person in the local country. All overseas
franchisees and licensees attend our one week's intensive training course at our
Head Office in the UK and following site visits and assistance with launching
new schools they are well positioned to make their Stagecoach businesses a
success.
We had expected to secure an international licence agreement for at least one
other country during this year, with discussions being held for Dubai, Sweden
and Latvia, and in May we signed an option agreement with non-refundable deposit
for Hong Kong. However, due to the credit crunch and global economic downturn
none of these sales were finalised during this year. We continue to engage in
discussions for these areas, and hope to finalise the agreement for Hong Kong,
and continually receive interest from other countries. Now that the overseas
licence format is showing positive signs of success in both Greece and Canada we
are confident that we can achieve future growth through more international
licence agreements.
With three new schools and two Early Stages classes opened in the other
international areas, the sales and profitability of the overseas division
increased. Once the economic climate shows signs of improvement, this is likely
to be a significant growth area for the Group.
At year end, in our other international locations, there were 6 franchisees, 23
Stagecoach schools, 25 Early Stages classes, a Further Stages class, 10 Mini
Stages classes and a total of 1,370 students (2008: 1,281 students). The average
student numbers were 39 per school (2008: 41.4 students). With network fees of
GBP723,000 (2008: 537,000) these other overseas operations contributed GBP70,000
profit before tax to the Group (2008: GBP59,000), representing an increase of
19% over the prior period.
Employees
The number of employees (full time equivalents) employed by the Group as at 31
May 2009 is 50 (2008: 53).
Stagecoach Charitable Trust
The Group continues to support and provide management time to the Stagecoach
Charitable Trust, a children's charity, which amongst other activities runs
InterAct Theatre Workshops, providing inclusive performing arts tuition to
children of all abilities and needs. The feedback from the children attending
InterAct and their parents has been overwhelmingly positive.
During the year InterAct has taken significant steps forward in expanding its
reach and involving over 400 children and young people in seven additional
locations with fourteen summer holiday workshops. InterAct has established a
presence in Bristol, Colchester, Croydon, Edinburgh, Jarrow, Leeds and
Nottingham in addition to its existing classes in Walton-on-Thames, Hampton,
Hounslow and Bournemouth. InterAct students have also had the opportunity to
perform with Stagecoach students at Her Majesty's Theatre, London, as well as
performing locally for family and friends.
Current Trading and Prospects
As for most companies, this has been a challenging year during this difficult
economic climate. However, the effects of the recession have had a minimal
impact on the sales and profitability of the business this year, demonstrating
once again the popularity of our Stagecoach Theatre Arts schools training and
education and the resilience of the business model.
The credit crunch has hampered both UK and overseas school openings, and this is
likely to continue into next year. However, there remain significant medium-term
growth prospects in the UK and considerable long-term growth potential for
SportsCoach, Stagecoach Germany and USA, as well as other new overseas
territories. From this platform therefore, we look forward to the future with
confidence.
+-------------------------------------+-------------------------------------+
| David Sprigg | Stephanie Manuel |
| Joint Managing Director | Artistic Director |
| | and Joint Managing Director |
+-------------------------------------+-------------------------------------+
5 August 2009
Financial Review
Network Fees and Group Turnover
Network fees, reflecting the total tuition fees earned by our network of
franchisees running Stagecoach Theatre Arts schools worldwide and SportsCoach
schools in the UK, increased 3.2% to GBP29.4m (2008: GBP28.5m). The higher
network fees reflect an increase in tuition fees in September 2008, and
compensated for the 4.2% fall in student numbers across the network. The UK
Stagecoach Theatre Arts schools account for 91.7% of network fees (2008: 92.3%)
following further growth in the number of international schools this year.
Group turnover, made up of continuing franchise fees, initial fees, transfer
fees and other ancillary income reduced marginally to GBP6.2m (2008: GBP6.3m).
The main effect of the credit crunch during the year was to limit the
availability of bank finance to prospective new franchisees wishing to purchase
existing Stagecoach businesses. This reduction in school re-sale fees together
with fewer subsequent school openings by existing franchisees resulted in a
GBP0.3 million reduction in initial fee turnover for the year. This reduction
was somewhat offset by an increase in continuing franchise fees from existing
schools of GBP0.2 million, thus resulting in a GBP0.1 million decrease in
turnover for the year.
Cost of Sales and Administrative Expenses
The Group costs of sales have remained level at GBP3.2m (2008: GBP3.2m).
We have reduced our administrative expenses over the year by 6.2% to GBP2.3m
(2008: GBP2.5m). This cost saving has primarily been delivered through the
restructuring of the Stagecoach USA operations. Other savings in overheads have
been made across the Group.
Profitability
The small decrease in turnover has been more than matched by a reduction in
costs, resulting in the Stagecoach Group reporting a modest 2.7% increase in
profit before tax to GBP726,000 (2008: GBP707,000).
Taxation
The Group has benefited from a Research and Development tax relief and tax
rebate claim for the work undertaken on our IT Global Reporting Management
System, which was developed and paid for between 2004 and 2007. A tax benefit of
GBP24,000 is included within these results for this Research and Development
claim.
The Group's effective tax rate, including the benefit of the Research and
Development claim and Stagecoach USA moving from loss making to profit this
year, reduced to 27.5% (2008: 29.1%).
Earnings per share and dividends
Earnings per share increased 3.9% to 5.3 pence (2008: 5.1 pence).
Your Board is pleased to propose the payment of a final dividend of 2 pence per
share (2008: 2 pence). The proposed dividend, which amounts to GBP198,186 (2008:
GBP197,586) will be paid on 25 November 2009 to those shareholders on the
register as at 30 October 2009. This dividend has not been accounted for in this
set of accounts, in line with accounting standards, as shareholders have not yet
approved the payment.
During the year an interim dividend of 0.5 pence per share was paid (2008: nil),
taking the total dividends paid or proposed for the year to 2.5 pence per share,
amounting to GBP247,583, being a 25% increase in the total dividends for the
year.
Share capital and share options
During the year 30,000 shares under option were exercised, increasing the share
capital to 9,909,317 ordinary shares in issue at 31 May 2009 (2008: 9,879,317).
On 29 January 2009, the Company awarded 86,020 share options, and 1,000 options
lapsed during the year on employees leaving the Group. There remain 1,060,355
options in issue, being 10.7% of shares in issue, with an exercise price between
32.5 pence and 112.5 pence.
Group Structure
The Stagecoach Group consists of the Stagecoach UK business including the UK
Agency, the SportsCoach and Mini Stages franchise networks, and the wholly owned
German and US subsidiaries. The other overseas operations run under licence or
direct franchise.
Balance Sheet
The Stagecoach Group had total equity at 31 May 2009 of GBP3.2 million (2008:
GBP3.0 million). The increase in total equity principally relates to the
retained profit for the year after payment of dividends to its shareholders.
Cash Flow
The Group increased its cash balances over the year by GBP5,000 to GBP1,037,000
at year end (2008: GBP1,032,000).
This increase was after the payment of GBP350,000 of corporation tax during the
year as the UK Company was re-classed as a large company for taxation reporting
purposes by HMRC and was required to pay this year's corporation tax quarterly
in advance, thus paying two years of taxation during this transition year.
Other principal non-operating cash payments during the year have been:
GBP246,000 of dividends
GBP99,000 final payment for the acquisitions of the minority interest in
Stagecoach Agency (GBP82,000) and Stagecoach Germany (GBP17,000)
GBP66,000 reduction in bank loan
GBP35,000 capital expenditure
The significant consequence of the positive cash flow over the past three years
is that the Group has not required the use of its overdraft facility since
October 2008, and now has sufficient cash resources to trade debt free for the
foreseeable future. The Group receives the majority of its cash in-flow three
times a year, six weeks into each academic term, from continuing franchise fees
for that term.
Following the collection of the Summer Term 2009 continuing franchise fees in
June 2009, the peak cash balance post year-end was GBP2.2 million.
Financial outlook
Trading post year-end has continued in line with expectations with GBP4.8
million of Stagecoach Group network fees earned in June and July 2009 and
positive cash inflow for the Group.
Richard Dawson
Group Finance Director
5 August 2009
Consolidated Income Statement
For the year ended 31 May 2009
+----------------------------------+-------+---------+---------+
| |Notes | 2009 | 2008 |
+----------------------------------+-------+---------+---------+
| | | GBP'000 | GBP'000 |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Network fees (see note) | | 29,435 | 28,466 |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Revenue | | 6,204 | 6,326 |
+----------------------------------+-------+---------+---------+
| Cost of sales | | (3,203) | (3,177) |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Gross profit | | 3,001 | 3,149 |
+----------------------------------+-------+---------+---------+
| Other operating income | | 23 | 30 |
+----------------------------------+-------+---------+---------+
| Administrative expenses | | (2,327) | (2,482) |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Operating profit | | 697 | 697 |
+----------------------------------+-------+---------+---------+
| Financial income | | 39 | 22 |
+----------------------------------+-------+---------+---------+
| Financial expenses | | (10) | (12) |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Net financing income | | 29 | 10 |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Profit before income tax | | 726 | 707 |
+----------------------------------+-------+---------+---------+
| Income tax expense | 2 | (200) | (206) |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Profit for the year | | 526 | 501 |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Attributable to: | | | |
+----------------------------------+-------+---------+---------+
| Equity holders of the parent | | 526 | 501 |
+----------------------------------+-------+---------+---------+
| | | | |
+----------------------------------+-------+---------+---------+
| Earnings per share (pence) | | | |
+----------------------------------+-------+---------+---------+
| Basic earnings per share | 4 | 5.3 | 5.1 |
+----------------------------------+-------+---------+---------+
| Diluted earnings per share | 4 | 5.3 | 5.0 |
+----------------------------------+-------+---------+---------+
Note: Network fees represent total school fees earned over the year by our
franchisees from over 38,900 students that attended Stagecoach, SportsCoach and
Mini Stages worldwide.
Consolidated Statement of Recognised Income and Expenses
For the year ended 31 May 2009
+----------------------------------------+---------+------------+--+
| | | |
+----------------------------------------+----------------------+--+
| | 2009 | 2008 | |
+----------------------------------------+---------+------------+--+
| | GBP'000 | GBP'000 | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| Foreign currency translation | (44) | (22) | |
| differences for foreign operations | | | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| Expense recognised directly in equity | (44) | (22) | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| Profit for the year | 526 | 501 | |
+----------------------------------------+---------+------------+--+
| Total recognised income and expense | 482 | 479 | |
| for the year | | | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| | | | |
+----------------------------------------+---------+------------+--+
| Attributable to: | | | |
+----------------------------------------+---------+------------+--+
| Equity holders of the parent | 482 | 479 | |
+----------------------------------------+---------+------------+--+
Consolidated Balance Sheet
As at 31 May 2009
+-----------------------------------------+---------+-----------+----------+
| | | |
+-----------------------------------------+---------------------+----------+
| | 2009 | 2008 | |
+-----------------------------------------+---------+-----------+----------+
| | GBP'000 | GBP'000 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Non-current assets | | | |
+-----------------------------------------+---------+-----------+----------+
| Property, plant and equipment | 92 | 100 | |
+-----------------------------------------+---------+-----------+----------+
| Intangible assets | 1,260 | 1,376 | |
+-----------------------------------------+---------+-----------+----------+
| Investments in subsidiaries | - | - | |
+-----------------------------------------+---------+-----------+----------+
| Total non-current assets | 1,352 | 1,476 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Current assets | | | |
+-----------------------------------------+---------+-----------+----------+
| Inventories | 245 | 303 | |
+-----------------------------------------+---------+-----------+----------+
| Trade and other receivables | 2,182 | 2,340 | |
+-----------------------------------------+---------+-----------+----------+
| Cash and cash equivalents | 1,037 | 1,032 | |
+-----------------------------------------+---------+-----------+----------+
| Total current assets | 3,464 | 3,675 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Total assets | 4,816 | 5,151 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Equity | | | |
+-----------------------------------------+---------+-----------+----------+
| Share capital | 495 | 494 | |
+-----------------------------------------+---------+-----------+----------+
| Share premium | 1,609 | 1,601 | |
+-----------------------------------------+---------+-----------+----------+
| Translation reserve | (79) | (35) | |
+-----------------------------------------+---------+-----------+----------+
| Retained earnings | 1,203 | 916 | |
+-----------------------------------------+---------+-----------+----------+
| Total equity attributable to equity | 3,228 | 2,976 | |
| holders of the company | | | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Non-current liabilities | | | |
+-----------------------------------------+---------+-----------+----------+
| Other interest-bearing loans and | - | 50 | |
| borrowings | | | |
+-----------------------------------------+---------+-----------+----------+
| Deferred tax liabilities | 8 | 16 | |
+-----------------------------------------+---------+-----------+----------+
| Total non-current liabilities | 8 | 66 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Current liabilities | | | |
+-----------------------------------------+---------+-----------+----------+
| Other interest-bearing loans and | 50 | 66 | |
| borrowings | | | |
+-----------------------------------------+---------+-----------+----------+
| Trade and other payables | 1,530 | 2,043 | |
+-----------------------------------------+---------+-----------+----------+
| Total current liabilities | 1,580 | 2,109 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Total liabilities | 1,588 | 2,175 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
| Total equity and liabilities | 4,816 | 5,151 | |
+-----------------------------------------+---------+-----------+----------+
| | | | |
+-----------------------------------------+---------+-----------+----------+
Consolidated Cash Flow Statement
For the year ended 31 May 2009
+-------------------------------------+--------------+--------------+-----------+
| | | |
+-------------------------------------+-----------------------------+-----------+
| | 2009 | 2008 | |
+-------------------------------------+--------------+--------------+-----------+
| | GBP'000 | GBP'000 | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash flows from operating | | | |
| activities | | | |
+-------------------------------------+--------------+--------------+-----------+
| Profit for the year | 526 | 501 | |
+-------------------------------------+--------------+--------------+-----------+
| Adjustment for: | | | |
+-------------------------------------+--------------+--------------+-----------+
| Depreciation and amortisation | 156 | 159 | |
+-------------------------------------+--------------+--------------+-----------+
| Foreign exchange differences | (52) | (41) | |
+-------------------------------------+--------------+--------------+-----------+
| Financial income | (39) | (22) | |
+-------------------------------------+--------------+--------------+-----------+
| Financial expense | 10 | 12 | |
+-------------------------------------+--------------+--------------+-----------+
| Loss on disposal of property, plant | 3 | 8 | |
| and equipment | | | |
+-------------------------------------+--------------+--------------+-----------+
| Write-down of territories held for | 45 | 13 | |
| resale | | | |
+-------------------------------------+--------------+--------------+-----------+
| Employee share option scheme | 7 | 8 | |
+-------------------------------------+--------------+--------------+-----------+
| Income tax expense | 200 | 206 | |
+-------------------------------------+--------------+--------------+-----------+
| Operating profit before changes in | 856 | 844 | |
| working capital and provisions | | | |
+-------------------------------------+--------------+--------------+-----------+
| Decrease/(increase) in trade and | 182 | (393) | |
| other receivables | | | |
+-------------------------------------+--------------+--------------+-----------+
| Decrease/(increase) in inventories | 13 | (18) | |
+-------------------------------------+--------------+--------------+-----------+
| (Decrease)/increase in trade and | (288) | 623 | |
| other payables | | | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash generated from the operations | 763 | 1,056 | |
+-------------------------------------+--------------+--------------+-----------+
| Interest received | 39 | 22 | |
+-------------------------------------+--------------+--------------+-----------+
| Interest paid | (10) | (12) | |
+-------------------------------------+--------------+--------------+-----------+
| Income tax paid | (350) | (167) | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Net cash from operating activities | 442 | 899 | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash flows from investing | | | |
| activities | | | |
+-------------------------------------+--------------+--------------+-----------+
| Acquisition of additional shares in | (99) | (99) | |
| subsidiaries | | | |
+-------------------------------------+--------------+--------------+-----------+
| Acquisition of property, plant and | (20) | (48) | |
| equipment | | | |
+-------------------------------------+--------------+--------------+-----------+
| Acquisition of intangible assets | (15) | - | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Net cash used in investing | (134) | (147) | |
| activities | | | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash flows from financing | | | |
| activities | | | |
+-------------------------------------+--------------+--------------+-----------+
| Shares issued | 9 | - | |
+-------------------------------------+--------------+--------------+-----------+
| Dividends paid | (246) | - | |
+-------------------------------------+--------------+--------------+-----------+
| Repayment of borrowings | (66) | (61) | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Net cash used in financing | (303) | (61) | |
| activities | | | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Net increase/in cash and cash | 5 | 691 | |
| equivalents | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash and cash equivalents at 1 June | 1,032 | 341 | |
+-------------------------------------+--------------+--------------+-----------+
| | | | |
+-------------------------------------+--------------+--------------+-----------+
| Cash and cash equivalents at 31 May | 1,037 | 1,032 | |
+-------------------------------------+--------------+--------------+-----------+
Notes to the Preliminary Results
1 Accounting Policies set out in the financial statements
General
Stagecoach Theatre Arts plc is a company incorporated in the UK.
The Group financial statements consolidate those of the Company and its
subsidiaries (together referred to as the 'Group').
Statement of compliance
The Group financial statements have been prepared and approved by the Directors
in accordance with International Financial Reporting Standards as adopted by the
EU ('Adopted IFRSs').
Basis of preparation
The accounting policies set out in the financial statements have, unless
otherwise stated, been consistently applied to all the periods presented in
these consolidated financial statements.
The Group has considerable financial resources together with long-term contracts
with a number of customers and suppliers across different geographic areas and
industries. As a consequence, the Directors believe that the Group is well
placed to manage its business risks successfully despite the current uncertain
economic outlook.
After making enquiries, the Directors have a reasonable expectation that the
Company and the Group have adequate resources to continue in operational
existence for the foreseeable future. Accordingly, they continue to adopt the
going concern basis in preparing the annual report and accounts.
2Income tax expense
Recognised in the income statement
+-----------------------------------------------------+---------+---------+
| | 2009 | 2008 |
+-----------------------------------------------------+---------+---------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------+---------+---------+
| Current tax expense | | |
+-----------------------------------------------------+---------+---------+
| Current year | 232 | 253 |
+-----------------------------------------------------+---------+---------+
| Adjustments for prior years | (24) | - |
+-----------------------------------------------------+---------+---------+
| Current tax expense | 208 | 253 |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Deferred tax expense | | |
+-----------------------------------------------------+---------+---------+
| Reversal and origination of temporary differences | (6) | (43) |
+-----------------------------------------------------+---------+---------+
| Reduction in tax rate | - | (4) |
+-----------------------------------------------------+---------+---------+
| Adjustment to tax charge in previous periods | (2) | - |
+-----------------------------------------------------+---------+---------+
| Deferred tax (credit)/expense | (8) | (47) |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Total tax expense in income statement | 200 | 206 |
+-----------------------------------------------------+---------+---------+
Deferred tax arose principally due to timing differences between capital
allowances and depreciation.
Reconciliation of effective tax rate
The total charge for the period is lower than the standard rate of corporation
tax in the UK of 28% (2008: 29.67%). The differences are explained below:
+-----------------------------------------------------+---------+---------+
| | 2009 | 2008 |
+-----------------------------------------------------+---------+---------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Profit for the year | 526 | 501 |
+-----------------------------------------------------+---------+---------+
| Total tax expense | 200 | 206 |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Profit excluding taxation | 726 | 707 |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Tax using the UK corporation tax rate of 28% (2008: | 203 | 210 |
| 29.67%) | | |
+-----------------------------------------------------+---------+---------+
| Effects of: | | |
+-----------------------------------------------------+---------+---------+
| Unrelieved losses of overseas subsidiaries | 21 | 37 |
+-----------------------------------------------------+---------+---------+
| Permanent tax differences | 2 | (37) |
+-----------------------------------------------------+---------+---------+
| Reduction in tax rate | - | (4) |
+-----------------------------------------------------+---------+---------+
| Adjustment to tax charge in previous periods | (26) | - |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Total tax expense | 200 | 206 |
+-----------------------------------------------------+---------+---------+
The GBP24,418 adjustment to the tax charge in previous periods mainly reflects a
GBP20,906 cash payment received from HMRC relating to Research and Development
tax credits for 2004-2007 which had not been previously recognised due to the
uncertainty of recoverability of the amount.
3Dividends
+-----------------------------------------------------+---------+---------+
| | 2009 | 2008 |
+-----------------------------------------------------+---------+---------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Amounts recognised as distributions to equity | | |
| holders in the year | | |
+-----------------------------------------------------+---------+---------+
| Final dividend for the year ended 31 May 2008 of 2p | 197 | - |
| per ordinary share (2007: nil). | | |
+-----------------------------------------------------+---------+---------+
| Interim dividend for the year ended 31 May 2009 of | 49 | - |
| 0.5p per ordinary share (2008: nil). | | |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| | 246 | - |
+-----------------------------------------------------+---------+---------+
| | | |
+-----------------------------------------------------+---------+---------+
| Amounts proposed as distributions to equity holders | | |
| | | |
+-----------------------------------------------------+---------+---------+
| Proposed final dividend for the year ended 31 May | 198 | 197 |
| 2009 of 2p per ordinary share (2008: 2p). | | |
+-----------------------------------------------------+---------+---------+
The proposed final dividend had not been approved by shareholders at 31 May 2009
and therefore has not been included as a liability. The comparative final
dividend at 31 May 2008 was also not recognised as a liability in the prior
year.
The proposed final dividend of 2p (2008: 2p) per ordinary share will be paid on
25 November 2009 to those shareholders on the register as at 30 October 2009,
subject to approval of shareholders.
4Earnings per share
+-----------------------------------------------------+--------+--------+
| | 2009 | 2008 |
+-----------------------------------------------------+--------+--------+
| | | |
+-----------------------------------------------------+--------+--------+
| Earnings | | |
+-----------------------------------------------------+--------+--------+
| Profit for the year for basic and diluted earnings | 526 | 501 |
| per share (GBP'000) | | |
+-----------------------------------------------------+--------+--------+
| | | |
+-----------------------------------------------------+--------+--------+
| Number of shares | | |
+-----------------------------------------------------+--------+--------+
| Weighted average number of shares used for basic | 9,881 | 9,879 |
| earnings per share ('000) | | |
+-----------------------------------------------------+--------+--------+
| Dilutive effect of share options | 83 | 106 |
+-----------------------------------------------------+--------+--------+
| Fully diluted weighted average number of shares | 9,964 | 9,985 |
| used for diluted earnings per share ('000) | | |
+-----------------------------------------------------+--------+--------+
| | | |
+-----------------------------------------------------+--------+--------+
| | | |
+-----------------------------------------------------+--------+--------+
| Basic earnings per share (pence) | 5.3 | 5.1 |
+-----------------------------------------------------+--------+--------+
| Diluted earnings per share (pence) | 5.3 | 5.0 |
+-----------------------------------------------------+--------+--------+
Basic earnings per share is calculated by dividing the profit attributable to
equity holders of the Company by the weighted average number of ordinary shares
in issue during the year.
Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding by the number of shares deemed to be
issued for no consideration (options granted to employees).
5Extract from the Group's statutory accounts
The financial information presented in this preliminary announcement does not
constitute statutory accounts within the meaning of the Companies Act 1985. The
information has however been extracted from the Group's statutory accounts for
the year ended 31 May 2009 which were approved by the Board on 5 August 2009 and
on which the Group's auditors have given an unqualified opinion.
6Responsibility
The Directors of the company accept responsibility for the information contained
in this document and to the best of their knowledge and belief (having taken all
reasonable care to ensure that such is the case) the information contained in
this document is in accordance with the facts and does not omit anything likely
to affect the import of such information.
7Annual Report and Accounts available on the website
The Annual Report and Accounts, which will be posted to shareholders as soon as
practicably possible, will shortly be available to download via the website,
www.stagecoach.co.uk. A copy of the Annual Report and Accounts may be obtained
upon application to the Company Secretary, subject to availability, at the
Company's Registered Office, The Courthouse, Elm Grove, Walton-on-Thames,
Surrey, KT12 1LZ.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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