Interim Results - Pre-tax Profit Up 24%
Holidaybreak PLC
6 December 1999
HOLIDAYBREAK PLC
PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 1999
'Record Profits'
* Profit before tax increased by 24% to £17.3 million (1998: £14.0 million)
* Turnover increased by 25% to £142.4 million (1998: £113.5 million)
* Strong cash generation - balance sheet strengthened
* Excellent contribution from Keycamp acquired at the end of 1998
* Hotel Breaks performing strongly
* Taking advantage of the trend towards direct purchasing via the Internet
* Actively seeking out potential acquisitions in the holiday sector
* Dividend increased by 12% to 14.0p (1998: 12.5p)
Commenting on the results Angus Crichton-Miller, Chairman, said: 'The
successful integration of Keycamp, the continued buoyancy of the camping
market and our position as the dominant operator in the sector, combined to
produce a record result for the Group. The current year has started well with
Hotel Breaks performing strongly and the expanding opportunities to market
direct to our customers give us good reason to be optimistic about the
future.'
Enquiries: Richard Atkinson, Chief Executive
Bob Baddeley, Finance Director
Holidaybreak plc
Telephone: 0171 796 4133 on Monday, 6 December 1999
Thereafter 01606 787 100
Michael Sandler
Tim Robertson
Hudson Sandler Limited
Telephone: 0171 796 4133
CHAIRMAN'S STATEMENT
I am pleased to report substantial progress by Holidaybreak plc in the year to
30 September 1999. Profits before tax at £17.3m on turnover of £142.4m (1998:
£113.5m), were up 24% on the 1998 figure, our largest ever year on year
increase. The increase in earnings per share, from 26.8p to 29.3p, in reality
understates our achievement as last year's figures included the benefit of six
weeks Keycamp trading which were disproportionately profitable.
TRADING PERFORMANCE
Our Camping Division has had an excellent year with all brands and markets
performing well. Bookings growth, higher sales values, camp-site occupancy
gains and an increased proportion of mobile-home bookings, along with
efficiencies resulting from the 1998 acquisition of Keycamp, all contributed.
The integration of Keycamp has gone extremely well and we have been delighted
with its performance in its first full year as part of the Holidaybreak Group.
Eurocamp, which remains our largest camping business and brand leader,
performed well in all the major European markets as well as the UK.
Hotel Breaks staged a healthy recovery after a difficult start to the year,
eventually recording turnover and operating profit figures in line with the
previous year. A strong finish to 1999 trading and a variety of distribution
and product development initiatives give us good reason to be optimistic about
future prospects.
DIVIDEND
The Board is recommending a final dividend of 9.6p, payable on 20 April 2000
to shareholders on the register on 24 March 2000, making a total of 14.0p for
the year, an increase of 12% over 1998. Dividend cover will be 2.1, in line
with our policy of maintaining approximately two times cover.
GROUP FINANCES
The acquisition of Baldwin plc, Keycamp's parent company, resulted in a
significant increase in our borrowings, which stood at £35.5m in the 1998
Balance Sheet. As we anticipated, substantial cash inflows resulting from the
sale of Baldwin's restaurants and various properties, along with record levels
of cash generated from our operating activities, reduced the year end debt
figure, to £24.9m as at 30 September 1999.
Interest cover is healthy at 7.2 times and the borrowing facilities we have in
place continue to provide ample headroom.
PRODUCT QUALITY
The holiday industry is increasingly competitive as the consuming public
rightly demand that holiday companies take all reasonable steps to avoid a
disappointing holiday. All our businesses place a very high priority on
delivering consistent service quality to their customers. Eurocamp, in
particular, is always rated highly in consumer surveys, notably by Holiday
Which? in their bi-annual report on holiday tour operators. We will not allow
a quest for growth to prejudice the product quality that we provide. The
reputation of our holidays is too valuable an asset to put at risk.
NAME CHANGE
At an Extraordinary General Meeting of the Company, held on 10 March 1999, a
special resolution to change the name of the Company to Holidaybreak plc was
passed. This change was made primarily to be able to explain our business
better to our investors, and has no impact on our customers. Eurocamp,
Keycamp, Superbreak and all the other trading companies continue to use their
existing brand names.
BOARD CHANGES
On 2 August 1999 the Company announced the appointment of Clive McLintock as
a non-executive director, in succession to Gordon Harman who has stepped down
from the non-executive position which he had held since retiring as Finance
Director in 1995. Clive McLintock brings with him a wealth of board
experience, some of it in the travel industry, and will make a valuable
contribution to the business in the coming years.
PROSPECTS
Hotel Breaks have made an excellent start to the new campaign, continuing the
strong trends experienced in the latter part of the year to 30 September 1999.
This strength includes the Christmas and New Year period where bookings are
ahead of previous years.
Camping is also on course. In a continuation of our yield optimisation
strategy, we have changed pricing structures in order to maximise potential,
particularly in peak periods. As expected, this has resulted in a slower take-
up during the main summer holiday period. As a consequence, overall booking
volumes are slightly behind the equivalent 1999 figure. The seasonal spread of
bookings has improved and we expect that the school holidays will eventually
sell out at significantly higher yields. We are confident that both Camping
and the Group as a whole will have another good year and that further progress
will be made.
Looking to the longer term, there is a clear trend towards consumers buying a
whole range of services direct. Both our divisions are extremely well placed
to take advantage of this trend and have been actively developing their
Internet distribution which we expect will become an increasingly important
feature, both of our own businesses and the travel sector in general in the
years to come.
EMPLOYEES
The move of our Group and Camping Division head offices to Hartford, where we
employ 300 people, has been extremely successful. In total we employ a
permanent workforce of 600 people in five countries. The quality of our people
continues to be a tremendous asset to the Group and I thank everyone for their
contribution to another excellent year for Holidaybreak plc.
Angus Crichton-Miller
Chairman
Holidaybreak plc- Consolidated
Profit and Loss Account for the
Year Ended 30 September 1999
1999 1998
£000 £000
Turnover 142,436 113,507
Cost (102,444) (82,181)
of
sales
Gross 39,992 31,326
profit
Administrative (19,942) (16,272)
expenses
Operating 20,050 15,054
profit
Investment 134 376
income
Interest (2,913) (1,427)
payable
Profit on
ordinary
activities
before 17,271 14,003
taxation
Tax on
profit on
ordinary
activities (5,165) (4,228)
Profit on
ordinary
activities
after 12,106 9,775
taxation
Dividends (5,800) (4,942)
paid and
proposed
Retained 6,306 4,833
profit for
the year
Earnings per 29.3p 26.8p
ordinary
share
Dividend
per
share:
Interim 4.4p 4.0p
Final 9.6p 8.5p
Holidaybreak plc- Balance
Sheet
as at
30 September
1999
1999 1998
£000 £000
Fixed
assets
Tangible 48,666 47,382
assets
Current
assets
Assets held for disposal 5,019 10,084
Debtors 11,905 11,755
Cash 26,194 23,237
at bank
and in hand
43,118 45,076
Creditors: (39,438) (47,023)
amounts
falling due
within one year
Net 3,680 (1,947)
current
assets/(liabilities)
Total 52,346 45,435
assets less
current liabilities
Creditors: (45,591) (45,023)
amounts falling due
after more than
one year
Provisions (74) (256)
for liabilities
and charges
Net assets 6,681 156
Capital and reserves
Called 2,069 2,061
up share capital
Share 15,470 15,154
premium
account
Other 87 87
reserves
Goodwill (45,548) (45,511)
write-off
reserve
Profit 34,603 28,365
and loss account
Equity 6,681 156
shareholders' funds
Holidaybreak plc - Consolidated Cash Flow
Statement for the Year Ended 30 September 1999
1999 1999 1998 1998
£000 £000 £000 £000
Net 28,562 13,515
cash inflow from
operating activities
Returns on investments and
servicing of finance
Interest 134 376
received
Interest (1,887) (604)
paid
Interest (1,026) (823)
element of
hire purchase
payments
(2,779) (1,051)
Taxation
UK (2,836) (2,289)
Taxation
paid
Overseas (696) (791)
Taxation
paid
(3,532) (3,080)
Capital expenditure
Purchase of (9,219) (12,114)
tangible fixed
assets
Receipts 2,706 2,405
from sale of
tangible fixed
assets
(6,513) (9,709)
Acquisitions
and disposals
Purchase (37) (26,020)
subsidiary
undertakings
(net of cash acquired)
Disposal of 6,737 -
Baldwin Limited and its
subsidiaries
6,700 (26,020)
Equity dividends (5,330) (4,215)
paid
Cash inflow (outflow) before
management
of liquid resources and 17,108 (30,560)
financing
Financing
Issue 324 10,725
of ordinary share
capital
Increase in - 21,000
loans
Capital (7,989) (3,403)
element of hire
purchase
payments
(7,665) 28,322
Increase 9,443 (2,238)
(decrease) in
cash in the year
NOTES
1. Segment 1999 1998
information
£000 £000
Group
turnover
by geographical
area was as follows:
United Kingdom and 109,518 86,123
Ireland
Netherlands 16,527 13,452
and Belgium
Germany, 13,168 11,807
Switzerland and
Austria
Others 3,223 2,125
142,436 113,507
Group turnover and profit before tax and
interest by class of business was as follows:
Turnover PBIT
1999 1998 1999 1998
£000 £000 £000 £000
Camping 103,739 74,925 16,231 11,142
Holidays
Short 38,697 38,582 3,819 3,912
breaks
142,436 113,507 20,050 15,054
2. Dividends 1999 1998
£000 £000
Interim 1,820 1,439
dividend
paid of 4.4p per ordinary
share (1998:4.0p)
Final 3,980 3,503
dividend proposed of 9.6p
per ordinary
share (1998:8.5p)
5,800 4,942
If approved by shareholders, the proposed final ordinary dividend will be paid
on 21 April 2000 to those ordinary shareholders on the register on 24 March
2000 and will absorb £3,979,392.
3. Non-statutory accounts
The results set out in this announcement are non-statutory accounts within the
meaning of Section 240 of the Companies Act 1985. The results for the year
ended 30 September 1999 are extracts from the 1999 Group accounts which, if
adopted by the members in General Meeting on 9 February 2000 will be filed
with the Registrar of Companies. These have been audited and reported upon
without qualification.
The results for the Year ended 30 September 1998 are extracts from the 1998
Group statutory accounts, as filed with the Registrar of Companies. These
were audited and reported upon without qualification.
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