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Booker Group PLC (BOK)

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Thursday 20 May, 2010

Booker Group PLC

Preliminary Results

RNS Number : 2026M
Booker Group PLC
20 May 2010
 



 

20 May 2010

Booker Group plc

 

Preliminary Results of Booker Group plc

for the 52 weeks ended 26 March 2010

 

This announcement contains the preliminary results of Booker Group plc ('Booker') for the 52 weeks ended 26 March 2010.

 

Financial Highlights             

·   Total sales +6.5% to £3.4bn (2009: £3.2bn)

·   Like for like sales +6.5%:

-    non-tobacco +6.9% (2009: +5.7% )

-    tobacco +5.8% (2009: -1.5% )

-    sales to caterers +9.1% (2009:+7.0%)

-    sales to retailers +5.3% (2009: +1.0%)

·   Operating profit +15.2% to £66.6m (2009: £57.8m)

·   Operating margins +0.15 percentage points to 1.97% due to better product mix and tight cost control (2009: 1.82%)

·   Profit before tax +21.2% to £57.2m (2009: £47.2m)

·   Profit after tax +21.4% to £47.6m (2009: £39.2m)

·   Basic earnings per share +21.3% to 3.19 pence (2009: 2.63 pence)

·   Net cash of £7.0m (2009: net debt of £24.9m)

·   Proposed final dividend of 1.03 pence per share (2009: 0.67 pence per share) making a total dividend for the year of 1.27 pence per share, up 46.0% on 2009 (2009: 0.87 pence per share)

 

Operational Highlights

·   Customer numbers have increased by 17,000 to 431,000 as customer satisfaction for choice, price and service has improved

·   91 of the UK's 173 branches had been converted into the 'Extra' format with 20 more to be converted in the 2011 financial year

·   Internet sales +62.8% to £407m (2009: £250m)

·   Booker Direct is continuing to grow

·   We opened our first branch in India in September 2009 to serve the kirana stores and caterers in Mumbai.  Customer reaction has been good

·   Plan for a second Mumbai branch and the test opening of a franchise branch in another city with a local partner in the 2011 financial year.  We believe that outside Mumbai expansion with partners could accelerate roll-out

 

Outlook

The economy is expected to remain difficult in the year ahead and the food wholesale market remains very competitive.  Nevertheless, we expect to continue to make progress in this challenging environment.  Trading in the first seven weeks of the current financial year remains in line with expectations.

 

Charles Wilson, Chief Executive of Booker, said:

 

"Our plan to focus, drive and broaden Booker continues to make good progress.   By improving the choice, price and service we offer to the 431,000 businesses we serve, Booker has helped customers to prosper in a difficult economic environment.  This has helped us grow sales by 6.5% and operating profits by 15%, whilst eliminating net debt.

 

"Internet sales have again grown strongly, while Booker Direct has had another good year with more contract wins.  The opening of our first store in India has been successful and we plan to open a further two stores in the year ahead.

 

"Successful independent retailers, pubs, nursing homes and cafes are crucial to communities throughout the UK and we look forward to continuing to serve these customers in the year ahead. While the outlook for the economy remains challenging, we are confident that Booker will continue to make progress by helping our customers to thrive."

 

 

For further information contact:

Tulchan Communications (PR Adviser to Booker Group plc)

020 7353 4200

Susanna Voyle

Lucy Legh

 

A presentation for analysts will be held at 08.30am on Thursday 20 May 2010 at Investec's offices. For further details please call Lucy Legh at Tulchan Communications on 0207 353 4200.



BUSINESS PROFILE

 

Booker has 173 cash and carry branches in the UK with a national delivery network

We serve approximately 305,000 catering businesses and 73,000 independent retailers

 


Customer

Numbers 000's

Sales

£bn

2006

Sales

£bn

 2007

Caterers

305

0.80

0.83

0.85

0.93

1.01

Retailers

73

2.13

2.10

2.15

2.19

2.31

Others

53

0.11

0.08

0.08

0.06

0.07

Total

431

3.04

3.01

3.08

3.18

3.39

 

Of our sales, £2.1bn is non-tobacco and £1.3bn is tobacco.

 


Sales

£bn

2006

Sales

£bn

 2007

Non Tobacco

1.77

1.75

1.84

1.95

2.09

Tobacco

1.27

1.26

1.24

1.23

1.30

Total

3.04

3.01

3.08

3.18

3.39

 

£2.6bn of sales are collected from the cash and carry by the customer.  £0.8bn is delivered to the customers' premises from the cash and carry or regional distribution centre.

 


Sales

£bn

2006

Sales

£bn

 2007

Cash and Carry collect

2.55

2.53

2.50

2.50

2.59

Delivered

0.49

0.48

0.58

0.68

0.80

Total

3.04

3.01

3.08

3.18

3.39

 

Substantial progress has been achieved since 2005.

 



Mar

2006

Mar

2007

Mar

2008

Mar

2009

Mar

2010

Sales Change

%

(5.9%)

(0.9%)

+2.3%

+3.3%

+6.5%

Operating Profit

£m

21.7

35.7

46.1

57.8

66.6

Net (Debt) / Cash

£m

(124.8)

(76.5)

(47.2)

(24.9)

7.0

 

Notes:        Figures for 2006 have been prepared under UK GAAP, and under IFRS thereafter. 

Sales and net (debt) / cash are calculated on a consistent basis under both UK GAAP and IFRS.

Operating profit in 2006 is stated under UK GAAP before goodwill, impairment and exceptional items. 

Figures stated 2007 are before an exceptional charge of £1.8m.

 



CHAIRMAN'S STATEMENT

 

I am pleased to report that Booker Group plc has again performed well.  In the year to 26 March 2010, sales rose by 6.5% while operating profit was up 15.2% and the Group ended the year with net cash of £7.0m.  Customer satisfaction continued to improve and the financial performance was good across the period.

 

The drive into the catering market is working with like-for-like sales to caterers up by 9.1% and sales to retailers up by 5.3%. 

 

The plans to 'broaden' the business are going well.  We have converted 91 of our 173 branches in the UK to the 'Extra' format.  The Extra format offers a better range and delivers a better customer experience.

 

Booker distributed £797m of product to our customers' premises this year versus £679m last year and we continue to expand our delivered offering. 

 

Internet sales are £407m compared to £250m in the previous year.

 

We opened our first Booker branch in Mumbai, India in September 2009 which is trading well.

 

During the year we moved trading in the Company's shares from the AIM market to the Official List. 

 

I should like to thank all our staff for their contribution to the success of the Group in the year just ended.

 

Basic earnings per share were 3.19 pence up from 2.63 pence last year. Given the strong operational performance of the business, the Board recommends the payment of a final dividend of 1.03 pence per share (2009: 0.67 pence per share) which, together with the interim dividend, makes a total dividend for the year of 1.27 pence per share (2009: 0.87 pence). The final dividend is payable on 9 July 2010 to shareholders on the register on 4 June 2010.

 

 

Outlook

The economy is expected to remain difficult in the year ahead and the food wholesale market remains very competitive. Nevertheless, we expect to continue to make progress in this challenging environment.  Trading in the first seven weeks of the current financial year remains in line with expectations.

 

 

Annual General Meeting

Our Annual General Meeting will be held on 7 July 2010. 

 

 

Richard Rose

Chairman

 



CHIef Executive's Report

 

Booker continues to make good progress.  In November 2005 we outlined our plan to focus, drive, and broaden the business.  That plan continues on track:

 

FOCUS (commenced November 2005)

We continue to improve business efficiency and cash management.  Throughout the business we are seeking to 'stop, simplify and standardise' work so that we enhance customer service whilst improving efficiency.  Through tight cash management we ended the year with net cash of £7m compared to net debt of £25m at the end of the previous financial year.

 

DRIVE (commenced April 2006)

During the year we served 431,000 customers, an increase of 17,000 customers versus last year.  We survey more than 40,000 customers each year to see how each branch and product category is performing.  Customer satisfaction for choice, price and service has improved during the year:

 

Choice Up

·      Following improvements to the range, fresh departments are doing particularly well with sales of fruit and vegetables up 54% in the year.

·      Euro Shopper, launched in July 2007, is one of the UK's fastest growing convenience brands with sales of more than £40 million per annum at wholesale prices.  The range now has 48 products, which allows retailers to benefit from great quality products at discount prices.  More than 16,000 retailers purchase Euro Shopper every week and the brand has proved popular with shoppers.  Recent launches include cornflakes, tissues, bleach, chewing gum and noodle snacks. In 2009, Euro Shopper Energy Drink won 'Product of the Year' at the prestigious Convenience Retail Awards.

·      We continue to build our entry price range for caterers with our Booker Basics brand.  We have recently launched tinned tomatoes, baked beans and ketchup.  Sales are up 28% year on year, at £50m per annum.

·      In 2008 we launched exclusive Lichfields Luxury individual portion packs - ideal for hotels and pubs. This range, extended in 2009 with the launch of Fair Trade Coffee Sticks and British Farm Assured Milk Sticks, has proved very popular with sales of £10m per annum, an increase of 38%.

 

Prices Down

·      Our pricing has remained competitive.  In spite of increases in commodity prices, we have managed to reduce the price of bread, milk and other essentials.  We have developed targeted promotions to help our customers drive sales at special occasions.  These include Chinese New Year, Back to College and Spring Clean, which have all proved popular. 

 

Better Service

·      Booker is now the UK's largest catering butcher. We regularly hold 'Meet the Butcher' week in branches giving the customers the opportunity to discuss their catering needs with their local branch butcher.  During these weeks we have cookery demonstrations, free stock give-aways and tastings.  

·      All branch staff are trained on PRIDE - our programme to improve parking, reception, internal, delivery and exit experiences for customers.

·      Our branch delivery service is growing and improving.

 

Catering

·      Improvements continue to be made to the catering offer resulting in a 3% increase in new customers and a growth in sales to caterers of 9.1%.  We are now selling over £1 billion of supplies to caterers per annum.

·      We have strengthened our Catering Development team, which is dedicated to help caterers grow their businesses, from 50 to 75 people over the last two years.  This team, many of whom have worked as chefs, publicans and caterers, are experts in developing customers' businesses.

 

Premier

·      Premier, Booker's symbol group, continues to go from strength to strength and is well on the way to becoming the UK's biggest and best symbol group. In the year the estate grew from approximately 2,200 to 2,500 stores.

·      Sales to Premier customers grew in the year by approximately 13% to £620m (2009: £550m). 

·      We relaunched Premier in March 09, which has been well received by retailers and suppliers.  Greater emphasis is now placed on bringing the Premier stores closer to the local community, and ensuring the store is ranged to meet the needs of the local consumer.

 

 

BROADEN (commenced April 2007)

We continue to 'broaden' Booker.

 

Improving the cash and carry experience

·      In 2006 we converted our first 'Extra' branch.  By March 2010, 91 of the UK's 173 branches had been converted to the 'Extra' format.  The key features are a lighter, brighter branch environment and improved layout, signage and ranges.  Our customers much prefer the environment.  The conversion pays back in around a year.  We plan to convert a further 20 Extras in the 2011 financial year.

 

 

 

 

Increased delivered wholesale

·      Booker distributed £797m of product to our customers' premises this year versus £679m last year.  About 90% of this is delivered via the cash and carry branches and 10% from the Booker distribution centres.  Booker Direct serves national accounts.  It is the UK's largest food supplier to the cinema sector.  Other customers include HM Prisons, Marks and Spencer and we have recently started supplying the NAAFI. 

 

Internet

·      Our website is market leading in the wholesale sector and is continually being developed to make it simpler, easier and faster for customers to use. Sales were £407m this year versus last year at £250m.  The site is tailored to the local branch and customer requirements.  Customers can see recent orders, make shopping lists and view new promotions and products. 

 

Booker India

·      We opened our first branch in India in September 2009. The offer in the Mumbai branch is tailored to suit the needs of the Indian market.  All the stock is purchased in India and 99% of the colleagues are local.  We now have approximately 4,000 customers who are either kirana stores or caterers.  The customer reaction has been excellent.  In the 2011 financial year we plan to open a further branch in Mumbai and test the opening of a franchised Booker branch in another city with a local partner.  We believe that outside Mumbai, expansion with partners could accelerate the roll-out whilst tailoring our offer to local markets.  This will help Booker offer the best choice, price and service for the kirana store and caterer.

 

 

The Focus, Drive, Broaden plan is facilitated by people development and by improving the sustainability of the business

 

People Development

·      All branch colleagues are trained in PRIDE (Parking, Reception, Internal, Delivery, and Exit.)  This programme was designed by branch colleagues to help improve customer service and has made a real impact. 

·      There is a shortage of butchers in the trade and as a result we have trained over 40 colleagues to start a career in butchery.  All of these colleagues had previously held other positions within branches and could progress further in the future to become Butchery Managers.  This first group completed their training in August 2009 and currently there are a further 52 colleagues who are on the programme.

 

Sustainability

·      Booker was the first food wholesaler to be awarded the Carbon Trust Standard.

·      Booker has now recycled over 1.5 million litres of catering customers' used cooking oil.  At our regional distribution centre in Hatfield we generate renewable electricity from used cooking oil.

·      Recycling increased by 13% and we sent 10% less to landfill in spite of the 6.5% increase in sales. 

 

 

In summary, our plan to focus, drive and broaden Booker continues to make good progress.   By improving the choice, price and service we offer to the 431,000 businesses we serve, Booker has helped customers to prosper in a difficult economic environment.  This has helped us grow sales by 6.5% and operating profits by 15%, whilst eliminating net debt.

 

Internet sales have again grown strongly, while Booker Direct has had another good year with more contract wins.  The opening of our first store in India has been successful and we plan to open a further two stores in the year ahead.

 

Successful independent retailers, pubs, nursing homes and cafes are crucial to communities throughout the UK and we look forward to continuing to serve these customers in the year ahead.  While the outlook for the economy remains challenging, we are confident that Booker will continue to make progress by helping our customers to thrive.

 

Charles Wilson

Chief Executive



Group Finance Director's Report

 

Financial Review

Overall Group revenue increased by 6.5% (2009: +3.3%).  Non tobacco like-for-like sales increased by 6.9% (2009: +5.7%) while like-for-like tobacco sales increased by 5.8% (2009: -1.5%).

 

Operating margins increased by 0.15 percentage points to 1.97% (2009: 1.82%) lifting group operating profit by £8.8m to £66.6m.  The improvement in margin was due to favourable product mix and good control of costs.

 

The net finance cost of £9.4m (2009: £10.6m) comprised:

§  net cash interest cost of borrowing of £6.8m (2009: £6.8m);

§  the amortisation of fees and discounting of provisions of £3.8m (2009: £4.7m);

§  a credit relating to the expected return on pension scheme assets less amortisation of liabilities of £1.2m (2009: £2.1m).

 

In 2009 the net finance cost also included the following additional items;

§  a charge relating to interest hedge instruments of £5.1m;

§  a £4.8m credit in relation to the discount on purchase of £26.3m of term debt;

§  £0.9m amortisation of fees carried in the balance sheet relating to the term debt purchased in the period.

 

Profit before tax rose £10.0m to £57.2m (2009: £47.2m), an increase of 21.2%.

 

The effective tax rate (being the tax charge as a percentage of profit before taxation) for the Group of 16.8% (2009: 16.9%) was below the standard rate of corporation tax in the UK, due principally to the utilisation of tax assets not recognised in prior years.

 

Profit after tax was £47.6m, an increase of £8.4m compared to 2009.

 

Basic earnings per share rose to 3.19p up 21.3% from 2.63p in 2009.

 

The Board is recommending a final dividend of 1.03 pence per share (2009: 0.67 pence per share) payable (subject to shareholder approval at the Annual General Meeting, to be held on 7 July 2010) on 9 July 2010 to shareholders on the register at 4 June 2010. The shares will go ex-dividend on 2 June 2010.

 

The final dividend lifts the total dividend for the year to 1.27 pence per share, up 46.0% on 2009 (2009: 0.87 pence per share).

 

Cash Flow

Management has continued to focus on cash generation resulting in a net debt improvement of £31.9m to a net cash position of £7.0m. Earnings before interest, tax, depreciation and amortisation (EBITDA) of £80.6m, up from £72.5m in the prior year, allowed an increase in capital expenditure to £15.5m (2009: £13.9m) and the payment of £13.6m of dividends (2009: £11.0m).

 

Pensions

The Booker Pension Scheme ("the Scheme") is a defined benefit scheme that was closed to new members in October 2001, and was closed to future accruals for existing members in August 2002. At 26 March 2010, the Scheme had an IAS 19 deficit of £21.8m (2009: £2.0m).

 

Scheme assets improved in the year by £125.7m to £563.5m due mainly to a rebalancing of the investment portfolio on 31 March 2009 taking the share of equities from 40% to 50% and the recovery in stock market prices subsequently.  The Group also contributed £11.6m (2009: £11.0m) in the year of which £1.6m (2009: £1.0m) was in relation to the costs of administering the Scheme.

 

The Scheme's estimated liabilities increased by £145.5m due to an increase in the expected level of inflation and a decrease in the rate by which net future cash flows are discounted. 

 

Goodwill

The net book value of goodwill in the balance sheet is £423.9m (2009: £423.9m). The goodwill carrying value is more than supported by expected future cash flows discounted back to present day values at a pre-tax discount rate of 11.2% (2009: 13.5%).

 

Capital Structure

The Group finances its operations through a combination of bank borrowings, leases and retained profits and its capital base is structured to meet the ongoing requirements of the business. As at 26 March 2010, the Group had net cash of £7.0m (2009: net debt of £24.9m).

 

Borrowing Facilities

The Group is required to repay half of cash generated in the prior year against its bank loan, a payment usually made in July following the year end.  In order to match the profile of its interest rate swap (see Interest Rates below), the Groups' banks agreed to waive this requirement for the year ended 26 March 2010 provided that £10.0m of the outstanding loan was repaid on 24 March 2010.  Consequently on 24 March 2010 the Group repaid £10.0m of its bank loan reducing the balance to £40.0m (2009: £50.0m). 

In addition to the bank loan, the Group had in place at 26 March 2010 a £146.0m revolving credit facility, which included a £32.9m guarantee facility.  Subsequent to the year end, bank guarantees of £10.0m were released and the revolving credit facility was reduced accordingly.  At the date of this Report, the revolving credit facility is £136.0m, which includes a £22.9m guarantee facility. 

 

The bank loan and revolving credit facility are secured against the assets of the Group.  There are cross guarantees between all Group companies (other than dormant subsidiaries).  All facilities are available until June 2012. 

 

The Group's borrowings are subject to covenants set by the lenders using financial results prepared under UK GAAP.  In the event of default of covenants on the bank facility, the principal amounts and any interest accrued are repayable on demand.

 

The financial covenants are Interest Cover, measured by the ratio of earnings before interest, tax, depreciation and amortisation ('EBITDA') to interest (tested quarterly), and Cash Cover, measured by the ratio of cash inflow to interest (tested half yearly).

 

The Group complied with its covenants throughout the year. At 26 March 2010, under UK GAAP the Group achieved Interest Cover of 12.9 and Cash Cover of 7.1, comfortably exceeding its covenant obligations. The Group must have also not required its revolving credit facility for a total of ten working days within the financial year, a target that was also exceeded.

 

In addition to these financial covenants the Group's borrowing agreements include general covenants and potential events of default. The Group has complied in all respects with the terms of its borrowing agreements at the date of this report.

 

Interest Rates

The bank loan and funds drawn on the revolving credit facility bear floating interest rates linked to LIBOR plus a margin of 2.0% to 2.6%. 

 

The Group's hedging policy has been revised in the course of the financial year from maintaining the profile of borrowings within a collar of interest rates to maintenance at a fixed interest rate.

 

At 27 March 2009 the Group had an amortising LIBOR interest rate swap at 4.98% for £130m, arranged in 2005, expiring in March 2011. In addition there were two option caps and a floor, also at £130m, which effectively set a collar between 4.25% and 5.68%.  The Group also had a £130m extension option at 4.98% exercisable at the discretion of HBoS in March 2011 for two years.

 

On 12 June 2009, the terms of its interest rate swap were amended to reflect the Group's current and expected level of debt.  The option caps, the floor and the extension option were removed and the amount of interest rate swap was reduced from £130.0m to £50.0m.  The interest swap remained at 4.98%.  £10.0m of the interest rate swap expired on 24 March 2010 with the remaining £40.0m expiring in March 2011.  The Group spent £7.2m in settlement of these investments, which is shown separately in the consolidated cash flow statement.  Ineffective hedge costs of £0.4m were incurred in the period from 27 March 2009 to 12 June 2009.

 

In the year the net cash interest cost of borrowing of £6.8m (2009: £6.8m) has remained neutral as lower costs of drawn funds has been offset by lower levels of interest received on surplus cash balances, increased non utilisation fees and ineffective hedge costs.

 

Liquidity

At 26 March 2010, £43.7m was held in cash and cash equivalents. The Group's only bank borrowings related to its £40.0m bank loan.

 

At 26 March 2010, the Group had in issue £30.7m of guarantees (2009: £31.2m) leaving undrawn facilities of £115.3m.

 

The peak level of drawdown on the revolving credit facility on a cleared basis in the year to 26 March 2010 was £53.5m giving a minimum facility headroom in the year of £61.8m after taking into account the guarantees referred to above.

 

Risk Management

The Board is continually reviewing the risks to people, profits, assets, reputation and funding that the business faces. The year ended March 2010 was a turbulent year. The economy was challenging with the 'credit crisis' and there was commodity price uncertainty.  Despite these and other challenges the Group's risk management controls operated well.

 

Jonathan Prentis

Group Finance Director



Consolidated Income Statement

For the 52  weeks ended 26 March 2010

 


Note

2010

2009



£m

£m





Revenue


3,386.9

3,179.2





Cost of sales


(3,271.9)

(3,077.0)



----------

----------

Gross profit


115.0

102.2





Administrative expenses


(48.4)

(44.4)



----------

----------

Operating profit


66.6

57.8





Finance income

2

1.2

7.3

Finance expenses

2

(10.6)

(17.9)



----------

----------

Net financing costs

2

(9.4)

(10.6)





Profit before tax


57.2

47.2





Tax

3

(9.6)

(8.0)







-----------

-----------

Profit for the period attributable to the owners of the Company


47.6

39.2



======

======





Earnings per share (Pence)




Basic

4

3.19p

2.63p



======

======

Diluted

4

3.11p

2.63p



======

======

 

 

Consolidated Statement of Comprehensive Income

For the 52 weeks ended 26 March 2010

 



2010

2009



£m

£m





Profit for the period


47.6

39.2





Actuarial loss on defined benefit plans


(32.6)

(24.9)

Tax relating to actuarial losses


9.1

7.0

Effective portion of changes in the fair value of cash flow hedge


 

1.4

 

(4.5)

Ineffective portion of cash flow hedge recycled to consolidated income statement


1.4

-

Tax relating to cash flow hedge


(0.8)

1.3



-----------

-----------

Other comprehensive expense


(21.5)

(21.1)





Total comprehensive income for the period attributable to the owners of the Company


 

26.1

 

18.1



======

======

 

 

 



Consolidated Balance Sheet

As at 26 March 2010

 


 

Note

2010

£m

2009

£m

ASSETS




Non-current assets




Property, plant and equipment


59.5

58.2

Intangible assets


423.9

423.9

Deferred tax asset


17.1

12.3



----------

----------



500.5

494.4

Current assets




Inventories


214.1

196.8

Trade and other receivables


72.2

63.6

Cash and cash equivalents


43.7

20.4



----------

----------



330.0

280.8







----------

----------

Total assets


830.5

775.2



----------

----------

LIABILITIES




Current liabilities




Interest bearing loans and borrowings


-

(0.2)

Trade and other payables


(408.8)

(364.8)

Current tax


(18.0)

(20.5)

Other financial liabilities


(1.6)

(11.6)



----------

----------



(428.4)

(397.1)

Non-current liabilities




Interest bearing loans and borrowings


(36.7)

(45.1)

Other payables


(28.2)

(28.2)

Retirement benefit liabilities

7

(21.8)

(2.0)

Provisions


(38.2)

(39.7)



----------

----------



(124.9)

(115.0)







----------

----------

Total liabilities


(553.3)

(512.1)



----------

----------





Net assets


277.2

263.1



======

======

EQUITY




Share capital


14.9

14.9

Share premium account


31.0

30.8

Merger reserve


260.8

260.8

Share option reserve


3.0

1.6

Hedge reserve


(1.2)

(4.0)

Retained earnings


(31.3)

(41.0)



----------

----------

Total equity attributable to equity holders


277.2

263.1



======

======

 

 



Consolidated Cash Flow Statement

For the 52     weeks ended 26 March 2010

 

 



2010

£m

2009

£m





Cash flows from operating activities




Profit before tax


57.2

47.2

Depreciation


14.0

14.7

Finance income


(1.2)

(7.3)

Finance expenses


10.6

17.9

Loss/(profit) on disposal of property, plant and equipment


0.1

(0.2)

Equity settled share based payments


1.4

1.4

Increase in inventories


(17.3)

(12.1)

Increase in debtors


(8.6)

(9.3)

Increase in creditors


44.6

18.7

Decrease in provisions


(3.7)

(5.4)

Contributions to pension scheme


(11.6)

(11.0)



----------

----------

Net cash flow from operating activities


85.5

54.6

Interest paid


(7.4)

(8.7)

Partial settlement of interest swap


(7.2)

-

Tax paid


(8.6)

(2.4)



----------

----------

Cash generated from operating activities


62.3

43.5



----------

----------

Cash flows from investing activities




Acquisition of property, plant and equipment


(15.5)

(13.9)

Sale of property, plant and equipment


0.1

1.4

Interest received


-

0.4



----------

----------

Net cash outflow from investing activities


(15.4)

(12.1)



----------

----------

Cash flows from financing activities




Payment of finance lease liabilities


(0.2)

(0.9)

Repayment of borrowings


(10.0)

(36.1)

Facility arrangement fees


-

(4.0)

Proceeds from issue of ordinary shares


0.2

-

Dividends


(13.6)

(11.0)



----------

----------

Net cash outflow from financing activities


(23.6)

(52.0)



----------

----------





Net increase/(decrease) in cash and cash equivalents


23.3

(20.6)





Cash and cash equivalents at the start of the period


20.4

41.0



-----------

-----------

Cash and cash equivalents at the end of the period


43.7

20.4



======

======





Cash and cash equivalents consist of:




Cash and cash equivalents


43.7

20.4

Bank overdrafts


-

-



----------

----------



43.7

20.4



======

======

 

 

 

 



Consolidated Statement of Changes in Equity

 

52 weeks ended 26 March 2010


 

Share capital

 

Share premium

 

Merger reserve

Share option reserve

 

Hedge reserve

 

Retained earnings

 

 

Total


£m

£m

£m

£m

£m

£m

£m









At 27 March 2009

14.9

30.8

260.8

1.6

(4.0)

(41.0)

263.1









Profit for the period

-

-

-

-

-

47.6

47.6

Defined benefit plan actuarial losses

-

-

-

-

-

(32.6)

(32.6)

Effective portion of changes in fair value of cash flow hedge

 

-

 

-

 

-

 

-

 

1.4

 

-

 

1.4

Ineffective portion of cash flow hedge recycled to consolidated income statement

 

-

 

-

 

-

 

-

 

1.4

 

-

 

1.4

Tax relating to components of other comprehensive income

 

-

 

-

 

-

 

-

 

(0.8)

 

9.1

 

8.3


----------

----------

----------

----------

----------

----------

----------

Total comprehensive income for the period

-

-

-

-

2.0

24.1

 

26.1









Shares options excercised

-

0.2

-

-

-

-

0.2

Share based payments

-

-

-

1.4

-

-

1.4

Dividends to shareholders

-

-

-

-

-

(13.6)

(13.6)

Reserves reclassification

-

-

-

-

0.8

(0.8)

-


----------

----------

----------

----------

----------

----------

----------

At 26 March 2010

14.9

31.0

260.8

3.0

(1.2)

(31.3)

277.2


======

======

======

======

======

======

======

 

 

52 weeks ended 27 March 2009


 

Share capital

 

Share premium

 

Merger reserve

Share option reserve

 

Hedge reserve

 

Retained earnings

 

 

Total


£m

£m

£m

£m

£m

£m

£m









At 29 March 2008

14.9

30.8

260.8

0.2

(1.6)

(50.5)

254.6









Profit for the period

-

-

-

-

-

39.2

39.2

Defined benefit plan actuarial losses

-

-

-

-

-

(24.9)

(24.9)

Effective portion of changes in fair value of cash flow hedge

 

-

 

-

 

-

 

-

 

(4.5)

 

-

 

(4.5)

Tax relating to components of other comprehensive income

 

-

 

-

 

-

 

-

 

1.3

 

7.0

 

8.3


----------

----------

----------

----------

----------

----------

----------

Total comprehensive income for the period

-

-

-

-

(3.2)

21.3

18.1









Share based payments

-

-

-

1.4

-

-

1.4

Dividends to shareholders

-

-

-

-

-

(11.0)

(11.0)

Reserves reclassification

-

-

-

-

0.8

(0.8)

-


----------

----------

----------

----------

----------

----------

----------

At 27 March 2009

14.9

30.8

260.8

1.6

(4.0)

(41.0)

263.1


======

======

======

======

======

======

======



Notes to the preliminary results

 

1. General information

 

Overview

Booker Group plc (the 'Company') is a public limited company incorporated in the United Kingdom (Registration number 05145685). The Company's ordinary shares are traded on the London Stock Exchange. The address of the registered office is Equity House, Irthlingborough Road, Wellingborough, Northamptonshire, NN8 1LT.

 

Status of financial information

The financial information set out herein does not constitute the Company's statutory accounts for the 52 weeks ended 26 March 2010 or 27 March 2009 but is derived from those accounts. Statutory accounts for 2009 have been delivered to the registrar of companies, and those for 2010 will be delivered in due course. The auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain statements under sections 237(2) or (3) of the Companies Act 1985 in respect of the accounts for 2009 nor a statement under sections 498(2) or 498(3) of the Companies Act 2006 in respect of the accounts for 2010.

 

Basis of accounting

In accordance with EU law (IAS Regulation EC 1606/2002), the preliminary results have been prepared in accordance with International Financial Reporting Standards ('IFRS') adopted for use in the EU as at 26 March 2010 ('adopted IFRS'), International Financial Reporting Interpretations Committee ('IFRIC') interpretations and those parts of the Companies Act 2006 applicable to companies reporting under IFRS.

The preliminary results consolidate those of the Company and its subsidiaries (together referred to as the 'Group').

 

Accounting standards adopted in the period

 

IAS 1 "Presentation of Financial Statements" (revised September 2007) was adopted during the period. This results in a number of terminology changes and changes in presentation and disclosure, including presenting a consolidated statement of comprehensive income to replace the consolidated statement of recognised income and expense, and the inclusion of a consolidated statement of changes in equity. There is no impact to the preliminary results other than presentation.

 

IFRS 8 "Operating Segments" was adopted during the period. Adoption of this standard has not led to any changes in reporting and the financial statements are presented as a single reportable segment. It requires that the segments should be reported on the same basis as the internal reporting information that is provided to the chief operating decision maker. The chief operating decision maker has been identified as the CEO. Internal reports reviewed regularly by the CEO focus on the operations of the Group as a whole and do not identify individual operating segments. Whilst turnover is reported by customer and product type, it is not possible to analyse profitability and balance sheets in this way. Products flow through the same distribution channels and there are a large amount of expenses and assets/ (liabilities) that are not specific. None of these possible segments have a unique management structure responsible for getting the product from the supplier to the customer. The Directors therefore present the financial statements as a single reportable segment.

 

There have been no further alterations made to the accounting policies as a result of considering all amendments to IFRS and IFRIC interpretations that became effective during the financial period as these were considered to be immaterial to the Group's operations or were not relevant.

 

 



 

2. Finance income and expense

2010

£m

2009

£m

 

 

 

Expected return on pension scheme assets

30.0

32.3

Interest on pension scheme liabilities

(28.8)

(31.5)

Transfer from legacy pension scheme

-

1.3

 

----------

----------

Net income attributable to pension scheme

1.2

2.1

 

 

 

Interest receivable and similar income

-

0.4

Discount on debt buyback

-

4.8

 

----------

----------

Finance income

1.2

7.3

 

----------

----------

 

 

 

Interest on bank loans and overdrafts

(6.8)

(7.2)

Loss on re-measurement of interest rate swap to fair value (net of recycling from hedge reserve)

 

-

 

(5.1)

Unwinding of discount on provisions

(2.2)

(2.7)

Amortisation of financing costs

(1.6)

(2.9)

 

----------

----------

Finance expense

(10.6)

(17.9)

 

----------

----------

 

 

 

Net financing costs

(9.4)

(10.6)

 

======

======

 

 

3. Tax

 

Tax on the profit for the period results in an effective rate of 16.8% (2009: 16.9%).

 

 

 



 

4. Earnings per share

 

Basic earnings per share are calculated by dividing the profit after tax by the weighted average number of ordinary shares outstanding during the period.

Diluted earnings per share is based on the weighted average number of ordinary shares in issue adjusted by dilutive outstanding share options and dilutive shares issuable under the Group's share plans.

 

 

2010

2009

 

 

 

Earnings

 Weighted average shares

 

Earnings per share

 

 

Earnings

 Weighted average shares

 

Earnings per share

 

£m

 Number m

Pence

£m

 Number m

Pence

 

 

 

 

 

 

 

Basic EPS

47.6

1,491.2

3.19

39.2

1,488.4

2.63

Share options

-

36.8

(0.08)

-

4.2

-

 

-----------

-----------

-----------

-----------

-----------

-----------

Diluted EPS

47.6

1,528.0

3.11

39.2

1,492.6

2.63

 

======

======

======

======

======

======

 

 

 

 

 

 

 

 

 



5. Dividends


2010

2009

Dividends charged to reserves

£m

£m




Final dividend of 0.67 pence per share (2009: 0.5375 pence per share) paid in respect of the prior period

 

10.0

 

8.0

Interim dividend of 0.24 pence per share (2008: 0.20 pence per share) paid in respect of the current period

 

3.6

 

3.0


--------

--------


13.6

11.0


=====

=====

 

The Directors are proposing a final dividend of 1.03 pence (2009: 0.67 pence) per share, which will absorb £15.4m of equity (distributable reserves). Subject to shareholder approval at the AGM, to be held on 7 July 2010, the dividend will be paid on 9 July 2010 to shareholders on the register at 4 June 2010. The shares will go ex-dividend on 2 June 2010.

 

6. Analysis of net (debt)/cash

 

 

At 27 March 2009

£m

Cash flow

£m

Non cash items

£m

At 26 March 2010

£m

 

 

 

 

 

Cash and cash equivalents

20.4

23.3

-

43.7

 

 

 

 

 

Finance leases

(0.2)

0.2

-

-

Bank loans

(50.0)

10.0

-

(40.0)

Unamortised arrangement fees

4.9

-

(1.6)

3.3

 

--------

--------

--------

--------

 

(45.3)

10.2

(1.6)

(36.7)

 

 

 

 

 

 

--------

--------

--------

--------

Net (debt)/cash

(24.9)

33.5

(1.6)

7.0

 

=====

=====

=====

=====

 

 

7. Retirement benefit liabilities




2010

2009


£m

£m




Total fair value of scheme assets

563.5

437.8

Present value of scheme liabilities

(585.3)

(439.8)


----------

----------

Deficit in the scheme

(21.8)

(2.0)


   ======

   ======

 



 

Responsibility statement of the Directors in respect of the Annual Report and Accounts

 

We confirm that to the best of our knowledge:

 

·    the group and parent company financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the company and the undertakings included in the consolidation taken as a whole; and

 

·    the Directors' Report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

 

 

By order of the Board

 

 

 

 

Charles Wilson                                                            Jonathan Prentis

Director                                                                        Director

 

19 May 2010

 

 


This information is provided by RNS
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