Interim Results

Big Yellow Group PLC 05 November 2002 Embargoed until 07.00 5 November 2002 Big Yellow Group PLC Results for the Six Months and Second Quarter ended 30 September 2002 Second First 6 months 6 months Quarter quarter ended 30 ended 30 ended 30 ended 30 September September 2001 September June 2002 2002 2002 Annualised revenue £16.4m £14.4m +14% £16.4m £8.8m +86% Turnover £3.9m £3.2m +22% £7.1m £3.6m +97% Loss for the period £0.65m £1.0m Loss per share 0.57p 0.92p No of customers 11,500 10,100 +14% 11,500 6,000 +92% Occupied space 753,000 sq ft 662,000 sq ft +14% 753,000 sq ft 401,000 sq ft +88% • Turnover up 97% to £7.1million (2001: £3.6million) • Annualised Revenue up 86% to £16.4 million (2001: £8.8 million) • Earnings before depreciation, amortisation, taxation and exceptional item £0.3million (2001: £0.4m loss) • Loss for the period £0.65 million (2001: £1.0 million loss) • 32 stores committed, (31 in the UK and one in France) of which 23 are trading, providing 1.9 million sq. ft. when completed • Number of customers up 92% to 11,500 (2001: 6,000) • Like for like annualised sales for 19 stores open throughout the period up 34% as at September when compared to March • Merchandise, insurance and other sales up to 14.7% of storage income (2001: 13.9%) David White, Chairman commented: "Since opening our first store in May 1999 in Richmond, we have succeeded in building the business to the point where at the end of September we have 11,500 customers, in 21 stores, with annualised turnover of £16.4m from 753,000 sq ft occupied out of a total potential of 1.9m sq ft for the 32 committed stores. "The business remains conservatively financed, is now cash flow positive, has first class assets, a strong brand, good growth potential and, most importantly, excellent people. This should provide us with resilience, if not necessarily complete immunity, and I believe will allow us to exploit opportunities as and when they arise." -Ends- For further Information, please contact: Big Yellow Group PLC 01276 470 190 Nicholas Vetch, Chief Executive James Gibson, Finance Director Weber Shandwick Square Mile 020 7950 2800 Susan Ellis/Louise Robson/Sally Lewis Embargoed until 07.00 5 November 2002 Big Yellow Group PLC Results for the Six Months and Second Quarter ended 30 September 2002 Chairman's Statement The Board of Big Yellow Group PLC is pleased to announce results for the six months and for the second quarter ended 30 September 2002. Since opening our first store in May 1999 in Richmond, we have succeeded in building the business to the point where at the end of September we have 11,500 customers, in 21 stores, with annualised turnover of £16.4m from 753,000 sq ft occupied out of a total potential of 1.9m sq ft for the 32 committed stores. Financial Review Turnover for the period was £7.1 million (2001: £3.6 million), a 97% increase on the comparable period last year. Merchandise, insurance and other sales represented 14.7% of total storage during the period. At the period end, underlying revenues on an annualised basis rose to £16.4 million, an increase of 86% when compared to that reported at September 2001. In the second quarter to 30 September 2002, annualised revenue rose by 13.8% to £16.4 million, compared to £14.4 million at 30 June 2002 and turnover for the same period rose by 22% to £3.9 million (first quarter to 30 June 2002: £3.2 million). On a like for like basis, annualised revenue from the 19 stores open throughout the period was 34% higher as at 30 September 2002 when compared to 31 March 2002. Loss for the period of £0.65 million (2001: loss of £1.0 million) is stated after charging exceptional costs of £192,000, incurred in respect of the Group's introduction to the Official List. The loss per share was 0.57p (2001: 0.92p). It is worth pointing out that the Group made an operating cash surplus for the first time. Earnings for the period were £0.3 million after operating, central overhead and interest costs, but before exceptional item, depreciation and tax. At the period end the number of customers had risen to 11,500 from 6,000 at 30 September 2001, a rise of 92% and from 8,100 at 31 March 2002, a rise of 42%. Review of Operations We are pleased to report that 23 stores are now trading (Bow and Brighton opened after the period end), providing a total capacity of 1.4 million sq. ft. 17 of the 23 stores are now trading profitably at the pre-tax level and 19 are operating cash flow positive, (after charging an allocation of head office overhead). Having made one further acquisition this quarter in Swindon, we now have 32 stores committed (31 in the UK and 1 in France), with a total capacity of 1.9m sq. ft.. Planning permission has been granted on 5 (1 subject to Judicial review) of the 9 stores in the pipeline, the remaining 4 being the most recently acquired. Total administration expenses were £1.8m for the period compared with £1.4m for the equivalent period last year. Of this total, £1.4 m relates to the UK, the remaining £0.4m in respect of costs incurred in France, including £160,000 written-off on an aborted property acquisition. We are very conscious of the need to maintain the highest standards of service provision across our expanded store portfolio as we believe this is central to the successful development of the Big Yellow brand. To this end we are strengthening our operational structure and James Gibson is to become Group Chief Operating Officer in addition to his role as Finance Director. Michael Cole will continue ably in his role as Group Financial Controller. Adrian Lee will become UK Managing Director, taking more responsibility for the coordination of the Group's UK activities in addition to his existing duties as Operations Director. Both appointments are with immediate effect. France We were unsuccessful in obtaining planning permission on the proposed site at Creteil, the acquisition of which was conditional on planning. We are awaiting imminently a planning decision on a proposed store within the Paris Peripherique which if successful will provide 80,000 sq ft of net storage and open in the early summer of 2003. We are hopeful of making further acquisitions but expansion will continue to be cautious. Share Buy Backs Following receipt of Shareholder and Court approval in September we acquired, before the period end, 4,082,500 shares for cancellation at an average purchase price of 76p per share. We will continue the buy back programme whilst it is considered beneficial for the Company and its shareholders. Future Strategy The Group remains committed to its target of 50 stores as detailed at our flotation in 2000, however, as we indicated a year ago, we have slowed down the rate of expansion. We are now seeing some evidence that property prices are beginning to soften in response to a weakening of occupier demand. Strengthening cash flow from our open stores will allow us to raise further debt and we remain confident that the share buy back will not inhibit us meeting our 50 store target, albeit at a slower pace than originally envisaged. Outlook Whilst the stores have traded strongly over the summer months we would remind shareholders that the business will experience the usual seasonal slowdown as we enter the winter. This time last year we expressed our caution about an economic downturn and the impact it would have on our business, and in our view those risks have increased over the last 12 months. The business however remains conservatively financed, is now cash flow positive, has first class assets, a strong brand, good growth potential and, most importantly, excellent people. This should provide us with resilience, if not necessarily complete immunity, and I believe will allow us to exploit opportunities as and when they arise. David White Chairman 5 November 2002 -Ends- For further Information, please contact: Big Yellow Group PLC 01276 470 190 Nicholas Vetch, Chief Executive James Gibson, Finance Director Weber Shandwick Square Mile 020 7950 2800 Susan Ellis/Louise Robson/Sally Lewis CONSOLIDATED PROFIT AND LOSS ACCOUNT Six months ended 30 September 2002 Note Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) (restated) £ £ £ TURNOVER 2 7,097,658 3,583,849 8,407,475 Cost of sales (5,512,216) (3,851,946) (8,288,937) -------------- -------------- -------------- GROSS PROFIT/(LOSS) 1,585,442 (268,097) 118,538 Administrative expenses (1,821,612) (1,383,864) (2,997,017) Exceptional item 3 (191,446) - - -------------- -------------- -------------- Total administrative expenses (2,013,058) (1,383,864) (2,997,017) Other operating income - 102,948 102,948 -------------- -------------- -------------- OPERATING LOSS (427,616) (1,549,013) (2,775,531) Interest receivable and similar income 431,298 345,210 511,436 Interest payable and similar charges 4 (979,423) (189) (42,109) -------------- -------------- -------------- LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (975,741) (1,203,992) (2,306,204) Taxation 5 322,339 202,716 388,295 -------------- -------------- -------------- Loss on ordinary activities after taxation and retained loss for the period/year 8 (653,402) (1,001,276) (1,917,909) ============== ============== ============== Loss per share 7 (0.57p) (0.92p) (1.70p) ============== ============== ============== Diluted loss per share 7 (0.57p) (0.92p) (1.70p) ============== ============== ============== All items in the profit and loss account relate to continuing operations. CONSOLIDATED BALANCE SHEET 30 September 2002 Note 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) (restated) £ £ £ FIXED ASSETS Intangible assets 1,577,986 1,674,980 1,626,483 Tangible assets 89,428,649 62,171,300 74,780,848 -------------- -------------- -------------- 91,006,635 63,846,280 76,407,331 -------------- -------------- -------------- CURRENT ASSETS Stocks 163,637 127,937 150,651 Debtors 5,717,249 4,483,199 4,715,393 Cash at bank and in hand 17,667,259 11,213,634 18,527,905 -------------- -------------- -------------- 23,548,145 15,824,770 23,393,949 CREDITORS: amounts falling due within one year (7,580,538) (4,717,364) (5,916,172) -------------- -------------- -------------- NET CURRENT ASSETS 15,967,607 11,107,406 17,477,777 -------------- -------------- -------------- TOTAL ASSETS LESS CURRENT LIABILITIES 106,974,242 74,953,686 93,885,108 CREDITORS: amounts falling due after more than one year (36,716,777) - (19,858,268) -------------- -------------- -------------- TOTAL NET ASSETS 70,257,465 74,953,686 74,026,840 ============== ============== ============== CAPITAL AND RESERVES Called up share capital 8 11,170,062 11,578,267 11,578,267 Capital redemption reserve 8 408,205 - - Share premium account 8 1,923,236 66,923,236 66,923,236 Other distributable reserves 8 61,873,678 - - Profit and loss account 8 (5,117,716) (3,547,817) (4,474,663) -------------- -------------- -------------- EQUITY SHAREHOLDERS' FUNDS 70,257,465 74,953,686 74,026,840 ============== ============== ============== RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS Six months ended 30 September 2002 Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) (restated) £ £ £ Loss for the financial period/year (653,402) (1,001,276) (1,917,909) Foreign exchange translation differences 10,349 (278) (10,491) -------------- -------------- -------------- (643,053) (1,001,554) (1,928,400) Issue of shares (net of issue costs) - 22,730,823 22,730,823 Purchase of own shares (3,126,322) - - -------------- -------------- -------------- Net (reduction) / addition to shareholders' funds (3,769,375) 21,729,269 20,802,423 Opening shareholders' funds as previously reported 74,026,840 51,747,259 53,224,417 Prior period adjustment - see note 1 - 1,477,158 - -------------- -------------- -------------- Opening shareholders' funds restated 74,026,840 53,224,417 53,224,417 -------------- -------------- -------------- Closing shareholders' funds 70,257,465 74,953,686 74,026,840 ============== ============== ============== STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES Six months ended 30 September 2002 Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) £ £ £ Loss for the period/year (653,402) (1,001,276) (1,917,909) Foreign exchange translation differences 10,349 (278) (10,491) -------------- -------------- -------------- Total recognised gains and losses (643,053) (1,001,554) (1,928,400) ============== ============== ============== CONSOLIDATED CASH FLOW STATEMENT Six months ended 30 September 2002 Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) £ £ £ Cash inflow/(outflow) from operating activities 678,718 (1,196,318) (613,944) Returns on investments and servicing of finance (244,732) 320,235 443,632 Capital expenditure and financial investment (15,026,818) (21,608,687) (34,936,577) -------------- -------------- -------------- Cash outflow before financing (14,592,832) (22,484,770) (35,106,889) Financing Issue of ordinary share capital (net of expenses) - 22,730,823 22,728,945 Increase in debt 16,858,509 - 19,938,268 Purchase of own shares (3,126,322) - - 13,732,187 22,730,823 42,667,213 -------------- -------------- -------------- (Decrease)/Increase in cash in the period/year (860,645) 246,053 7,560,324 ============== ============== ============== RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS Six months ended 30 September 2002 Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) £ £ £ (Decrease)/increase in cash in the period/year (860,645) 246,053 7,560,324 Cash inflow from increase in debt financing (16,858,509) - (19,938,268) -------------- -------------- -------------- Change in net (debt)/funds resulting from cash flows (17,719,154) 246,053 (12,377,944) -------------- -------------- -------------- Movement in net (debt)/funds in the period/year (17,719,154) 246,053 (12,377,944) Net (debt)/funds at start of period/year (1,410,363) 10,967,581 10,967,581 -------------- -------------- -------------- Net (debt)/funds at end of period/year (19,129,517) 11,213,634 (1,410,363) ============== ============== ============== RECONCILIATION OF OPERATING LOSS TO NET CASH FLOW FROM OPERATING ACTIVITIES Six months ended 30 September 2002 Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) £ £ £ Operating loss (427,616) (1,549,013) (2,775,531) Depreciation 1,025,609 768,171 1,605,049 Amortisation of goodwill 48,498 48,498 96,996 Increase in stock (12,986) (33,789) (56,502) Increase in debtors (681,576) (320,099) (431,353) Increase/(decrease) in creditors 726,789 (110,086) 947,397 -------------- -------------- -------------- Net cash inflow/(outflow) from operating activities 678,718 (1,196,318) (613,944) ============== ============== ============== NOTES TO THE INTERIM REPORT Six months ended 30 September 2002 1. ACCOUNTING POLICIES Basis of preparation The interim information for the six months ended 30 September 2002 and 30 September 2001 is unaudited and does not comprise statutory accounts. The comparative figures for the year ended 31 March 2002 are not statutory accounts but are extracted from the audited statutory accounts. The statutory accounts for the year ended 31 March 2002 have been filed with the Registrar of Companies. They received an unqualified audit report which did not contain a statement under Section 237(2) or 237(3) of the Companies Act 1985. This interim report should be read in conjunction with the statutory accounts for the year ended 31 March 2002. The interim figures have been prepared on the same basis and applying the same accounting policies as in prior years. The accounts for the year ended 31 March 2002 contained a prior year adjustment in respect of the year ended 31 March 2001 for FRS 19, where £1,477,158 was recorded as a tax credit. The comparatives for the period ended 30 September 2001 have been restated to reflect a change in accounting policy following the adoption of FRS 19 "Deferred Tax". The effect of this change on the statement for the period ended 30 September 2001 is to record a debtor of £1,679,874, a tax credit of £202,716, and a credit to opening reserves of £1,477,158. 2. SEGMENTAL INFORMATION Turnover represents amounts derived from the provision of services which fall within the Group's ordinary activities after deduction of trade discounts and value added tax. The Group's net assets, turnover and loss before tax, all of which arises in the United Kingdom, with the exception of £365,263 (2001: £173,465) in respect of administration expenses in France, are attributable to one activity, the provision of self storage and related services. 3. exceptional item The Group was admitted to the Official List and cancelled its AIM listing on 7 June 2002. Exceptional costs relating to this change of £191,446 have been incurred in the period. 4. INTEREST PAYABLE AND SIMILAR CHARGES Six months Six months Year ended ended ended 30 30 31 September September March 2002 2001 2002 (Unaudited) (Unaudited) (Audited) £ £ £ Bank overdraft and other borrowings 979,423 189 42,109 -------------- -------------- -------------- 979,423 189 42,109 ============== ============== ============== 5. TAXATION No liability to corporation tax arises on the Group's result for the period as the Group made a taxable loss during the period. The Group has unrelieved tax losses for which a deferred tax asset has been recognised (see note 1). 6. DIVIDENDS Dividends have not been paid in respect of the ordinary shares of the Company in any of the periods reported upon and no dividend is proposed. 7. LOSS PER ORDINARY SHARE Loss per ordinary share has been calculated on the retained loss for the period of £653,402 (2001: £1,001,276) and on the weighted average number of shares in issue during the period of 115,419,623 (2001: 109,330,311). There is no dilutive effect from the conversion of share options. 8. MOVEMENT ON RESERVES Capital Share Other Profit and Share redemption premium distributable loss capital reserve account reserves account Total £ £ £ £ £ £ Balance at 1 April 2002 11,578,267 - 66,923,236 - (4,474,663) 74,026,840 Loss for the year - - - - (653,402) (653,402) Foreign exchange - - - - 10,349 - Capital transfer - - (65,000,000) 65,000,000 - - Purchase of own shares (408,205) 408,205 - (3,126,322) - (3,126,322) -------------- -------------- -------------- -------------- -------------- -------------- 11,170,062 408,205 1,923,236 61,873,678 (5,117,716) 70,257,465 ============== ============== ============== ============== ============== ============== On 4 September 2002, the Company received confirmation from the Court to allow the reduction of the share premium account by £65,000,000. The order of the Court became effective on 5 September 2002 and £65,000,000 was transferred from the share premium account to a distributable reserve. INDEPENDENT REVIEW REPORT TO BIG YELLOW GROUP PLC Introduction We have been instructed by the company to review the financial information for the six months ended 30 September 2002 which comprises the profit and loss account, the balance sheet, the reconciliation of movements in shareholder funds, the statement of total recognised gains and losses, the cash flow statement, the reconciliation of movement in shareholders' funds, the statement of total recognised gains and losses and the related notes 1 to 8. 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 directors are also responsible for ensuring that the accounting policies and presentation applied to the interim figures are consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 issued by the Auditing Practices Board. 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 accounting policies and presentation have been consistently applied unless otherwise disclosed. 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 performed in accordance with United Kingdom auditing standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. 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 six months ended 30 September 2002. Deloitte & Touche Chartered Accountants London 5 November 2002 This information is provided by RNS The company news service from the London Stock Exchange

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