Interim Results

Stagecoach Theatre Arts PLC 02 February 2004 Stagecoach Theatre Arts plc - Interim Results 2003 Stagecoach Theatre Arts plc ('Stagecoach Theatre Arts', 'Stagecoach' or the 'Group') Announcement of Interim Results for the six months ended 30th November 2003 Stagecoach Theatre Arts continues to expand its core business, operating the UK's largest franchise network of part-time performing arts schools for young people aged between 4 and 16. The Group again reports record numbers of schools and students throughout the network, whilst investing heavily in other potential growth opportunities. There are now 28,300 students attending Stagecoach and SportsCoach schools in the UK (2002: 24,200 students). A summary of the Group's results and achievements during the six-month period is as follows: Franchise network turnover up 14.7% to £8.6 million (2002: £7.5 million) Profit of £0.15m (2002: £0.35 million), primarily reflecting the significant investment in SportsCoach, USA, Germany and Mini Stages. 477 Stagecoach schools and 465 Early Stages classes as at 30th November 2003 28,300 students across the UK (2002: 24,200 students) 18 SportsCoach schools and 652 students First USA franchisee operating a Stagecoach school Acquired 90% of Stagecoach Germany on 29th July 2003 Launch of Mini Stages, music for babies and toddlers, in September 2003 A number of high profile successful events and productions during the period Stephanie Manuel and David Sprigg, Joint Managing Directors, commented: 'We are delighted with the continued growth of the core Stagecoach Theatre Arts business during this six month period. This has also been a period of further development in SportsCoach, Stagecoach USA, Stagecoach Germany and the launch of Mini Stages. We continue to meet our strategy for growth, whilst maintaining the very high standards of education across the entire network.' Enquiries: Stagecoach Theatre Arts: Tel: 01932 254 333 Richard Dawson, Finance Director and Investor Relations Evolution Beeson Gregory: Tel: 020 7071 4300 Tom Price Henry Turcan Public Relations, JBPR: Tel: 01629 825 777 John Burley Chairman's Statement Results The Group's results for the six months ended 30th November 2003 reflect a period of continued expansion in the core Stagecoach business, reporting record numbers of schools and students, whilst investing heavily in other potential growth opportunities. There are now 28,300 students attending Stagecoach and SportsCoach schools in the UK (2002: 24,200 students). The network turnover, reflecting the underlying school fees throughout the franchise network, for the period was approximately £8.6 million (2002: £7.5 million). Group profit before tax was £154,000 (2002: £352,000), in line with expectations. The investment in the development of SportsCoach, Stagecoach USA, the acquisition of Stagecoach Germany, and the launch of Mini Stages during this period primarily accounted for the reduced profitability of the Group as compared to last year. In addition, we anticipate a greater proportion of franchise initial fees will be recognised in the second half of this financial year as compared to the same period last year. The franchise network turnover and the Group's overall profitability is as projected for the first half of this financial year. Earnings per share were 1.1 pence (2002: 2.5 pence). Operational Performance Stagecoach schools The numbers of Stagecoach Theatre Arts schools and students attending them has further increased over the period to 477 schools and 21,200 students (2002: 424 schools and 18,800 students). In addition, the number of Early Stages classes has increased to 465 with 6,500 students (2002: 381 Early Stages classes and 5,300 students). Across the entire network of Stagecoach Theatre Arts schools, including the new schools and Early Stages classes opened this Autumn Term, over 97% of all available places are taken. This growth has been achieved whilst maintaining the high standards of education throughout the network. SportsCoach schools The expansion of the SportsCoach franchise network is ahead of schedule. The first SportsCoach franchised schools started in April 2003. There are now 18 schools and 652 SportsCoach students. Importantly, this includes two franchisees who are running two SportsCoach schools. The pipeline of prospective new SportsCoach franchisees for the next 12 months ahead is very encouraging. We expect that the SportsCoach division will start contributing at a Group profit level from the second half of this year. Overseas schools We continue to invest in and develop both our USA and German subsidiary companies. During this period Stagecoach Germany acquired the business operations and net assets of our former joint venture partner, and Stagecoach USA sold its first franchise. Between these two markets, both promising future growth opportunities for the Group, there are eleven Stagecoach schools, twelve Early Stages classes and a total of 607 students. Mini Stages Mini Stages, for six months to five-year-olds, was launched in September 2003 and complements the Group's existing core business of teaching the performing arts. The Mini Stages pilot was introduced in three venues in Walton-on-Thames, Epsom and Wimbledon, with two of these venues being fully enrolled from launch. This new educational concept allows the child (accompanied by parent or guardian) to listen, beat time, march to rhythms, sing songs, play with instruments and develop creativity, co-ordination and confidence. A selection of props and soft toy animals are used to animate the songs and create sessions packed with 'structured fun'. The Group intends to offer Mini Stages franchises from 2004, and has already received a number of franchise enquiries. Creative and Educational The Group staged a number of very successful events during the period. On 6th July, 1,500 Stagecoach students from across the UK performed in a charity concert, Sing-a-Single, at The Royal Albert Hall. The record produced from the Sing-a-Single concert, 'Angel Looking Through', made the UK pop charts. The annual Easy Stages showcase production at the Epsom Play House in August, this year being 'Seven Brides for Seven Brothers', featured 70 Stagecoach students from schools across the country and overseas. On 30th November, students from the first 14 Stagecoach schools performed a selection of dance and singing routines at Her Majesty's Theatre, London, celebrating fifteen years of Stagecoach Theatre Arts. Dividend Stagecoach Theatre Arts plc paid its maiden dividend as a public company of 2 pence per share on 27th November 2003. In accordance with the existing dividend policy, no interim dividend has been proposed. Outlook The core Stagecoach business continues to grow strongly in the UK. The high occupancy rates and in many cases waiting lists evidence the strong demand from pupils for places throughout the franchise network. The SportsCoach division is ahead of expectations in terms of number of franchises, schools and students. The overseas operations, particularly USA and Germany, are in line with the strategy as set out at flotation, and represent future growth opportunities. Mini Stages is proving to be an exciting new development within the Group. With a strong pipeline of additional schools and an increasingly broad educational product offering, the prospects for the future look encouraging. Graham Cole Chairman 2nd February 2004 INDEPENDENT REVIEW REPORT TO STAGECOACH THEATRE ARTS PLC Introduction We have been instructed by the company to review the financial information for the six months ended 30th November 2003 which comprises the consolidated profit and loss account, consolidated balance sheet, consolidated cashflow statement and the related notes that have been reviewed. 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. 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 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 30th November 2003. PKF Guildford 2nd February 2004 Stagecoach Theatre Arts plc Consolidated Profit and Loss Account Unaudited Unaudited Audited Six months ended Six months ended Year ended 30 Nov 2003 30 Nov 2002 31 May 2003 £000 £000 £000 Turnover Continuing activities 2,385 2,244 4,768 Acquired activities 67 113 193 2,452 2,357 4,961 Operating profit Continuing activities 136 343 824 Acquired activities 5 (8) (54) 141 335 770 Net interest receivable 13 17 35 Profit on ordinary activities before taxation 154 352 805 Tax on profit on ordinary activities (52) (109) (277) Profit on ordinary activities after taxation 102 243 528 Minority interests (1) - - Dividends - - (194) Retained profit for the period 101 243 334 Earnings per share, pence 1.1 2.5 5.5 - Basic - Diluted 1.0 2.5 5.4 Stagecoach Theatre Arts plc Consolidated Balance Sheet Unaudited Unaudited Audited 30 Nov 2003 30 Nov 2002 31 May 2003 £000 £000 £000 Fixed assets Intangible assets 847 771 774 Tangible assets 133 115 114 980 886 888 Current assets Stock 263 206 206 Debtors 1,378 875 1,671 Cash 1,169 1,601 1,029 2,810 2,682 2,906 Creditors Amounts falling due within one year (1,154) (1,113) (1,273) Net current assets 1,656 1,569 1,633 Total assets less current liabilities 2,636 2,455 2,521 Creditors Amounts falling due after one year (39) (68) (44) Net assets 2,597 2,387 2,477 Capital and reserves Share capital 486 484 485 Share premium 1,544 1,530 1,531 Profit and loss account 562 373 461 Equity shareholders' funds 2,592 2,387 2,477 Minority interests 5 - - Total capital employed 2,597 2,387 2,477 Stagecoach Theatre Arts plc Consolidated Cash Flow Statement Unaudited Unaudited Audited Six months ended Six months ended Year ended 30 Nov 2003 30 Nov 2002 31 May 2003 £000 £000 £000 Net cash inflow from operating activities 392 32 (286) Returns on investments and servicing of finance 14 17 35 Taxation - - (218) Capital expenditure (62) (21) (54) Acquisitions and disposals (25) (38) (46) Equity dividends paid (194) - - Net cash outflow before financing 125 (10) (569) Financing 15 (4) (17) Increase / (decrease) in cash 140 (14) (586) Stagecoach Theatre Arts plc Notes Basis of preparation The interim financial statements have been prepared on the basis of the accounting policies set out in the statutory accounts for the year ended 31st May 2003. The figures for the year ended 31st May 2003 have been extracted from the statutory accounts for the year. These accounts received an unqualified audit report and have been filed with the Registrar of Companies. On 29th July 2003, Stagecoach Theatre Arts plc acquired 90% of the business operations of Stagecoach Theatre Arts Schools GmbH, a German company. The results of this subsidiary are consolidated from the date of acquisition. The goodwill arising on consolidation in respect of acquisitions has been capitalised and is amortised over its estimated useful life. The directors regard 20 years as a reasonable period for the estimated life of goodwill. The half-year figures to 30th November 2003 have not been audited by the Group's auditors and do not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. Earnings per share Earnings per share have been calculated on earnings for the period divided by the weighted average number of Ordinary shares in issue of 9,696,419 (2002: 9,688,172). Fully diluted earnings per share have been calculated based upon the weighted average number of ordinary shares, including options granted to employees, of 9,822,239 (2002: 9,871,749). Taxation Corporation Tax for the period has been charged at 30%, being the effective rate for the year ended 31st May 2003, and is the current expected rate for this year ending 31st May 2004. Dividends No interim dividend has been proposed. Responsibility 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. Availability of Interim Report Copies of these results together with the Chairman's statement are being sent to shareholders and will also be available from the company's registered office at 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

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