Interim Results
Halfords Group PLC
25 November 2004
25 November 2004
HALFORDS GROUP PLC
INTERIM RESULTS TO 1 OCTOBER 2004
Halfords Group Plc ('Halfords Group' or the 'Company') today announces its
maiden interim results for the 26 weeks to 1 October 2004.
Financial Highlights
• Turnover up 12.7% to £322.7m
• Like-for-like sales up 10.6%
• Operating profit before amortisation of goodwill and exceptional operating
items up 18.3% to £46.0m
• Operating profit up 9.1% to £34.9m
• Pre-tax profit up 170% to £26.5m
• Basic earnings per share before amortisation of goodwill and exceptional
operating items up 43% to 12.3 pence
• Basic earnings per share up 220% to 8.0 pence
• Maiden interim dividend 3.7 pence per share
Business Highlights
• Strong growth in all key business areas
• 28 new supermezzanines opened
• Programme of mezzanine conversions and new store openings running to plan
David Hamid, Chief Executive Officer of Halfords Group commented:
'I am very pleased with Halfords' first set of results since the company's
successful IPO in June. We have delivered a good set of results and continue to
develop and position the business for ongoing growth. Turnover in the six week
period to 12 November 2004 is in line with our expectations and we remain
confident about future prospects for the Company.'
For further information please contact:
Halfords Group plc 01527 513129
Ian McLeod, Chief Operating Officer
Nick Carter, Finance Director
Citigate Dewe Rogerson 0207 638 9571
Rachel Lankester
Freida Moore
A presentation for analysts and investors will be held at Merrill Lynch, King
Edward Hall, 2 King Edward Street, London, EC1A 1HQ at 9.30am today.
In addition there will be an opportunity to listen to the presentation on the
following conference call:
Tel: 0208 996 3920
Access code: C355445
This press release and the analyst presentation will be available to download
from the Investor Relations section of the corporate website at
www.halfordscompany.com from 7:00am and 9:30am respectively.
About Halfords Group
The Halfords Group is the UK's leading, by turnover, car maintenance, car
enhancement, cycle and travel solutions retailer, with 393 stores across
England, Wales, Scotland and Northern Ireland and over 9,000 employees.
The Halfords Group's 11,000 product lines range from car parts to bikes, alloy
wheels to roof boxes, child travel seats to the latest in-car entertainment,
leisure and camping equipment.
In its larger stores, the Halfords Group features specialist sub-shops for
audio, automotive parts, car enhancement (Ripspeed) and cycling (Bikehut).
Halfords was established in 1892 and floated on the London Stock Exchange in
June 2004. It is a FTSE 250 company.
Halfords online store can be found at www.halfords.com.
Overview
The Halfords Group is the UK's leading, by turnover, car maintenance, car
enhancement, cycle and travel solutions retailer with 393 stores across England,
Wales, Scotland and Northern Ireland. The Halfords Group is delivering a growth
strategy focused on maintaining and leveraging its core strengths in these key
business areas and developing new business opportunities e.g. Active Leisure and
Kids Zone.
The organic growth achieved in the first half of this financial year reflects
the progress that has been made in delivering this strategy, which was outlined
at the time of the IPO in June 2004.
In addition to driving sales the Halfords Group is constantly striving to
improve its operational efficiencies. This disciplined approach has ensured
that, while the business has been growing, costs have remained under tight
control improving net ratios.
Summary of Group Results
26 Week Period Ended
Unaudited 1 October 2004 26 September 2003
£m £m
Turnover 322.7 286.3
Gross Profit 170.8 151.9
Gross Profit % of Turnover 52.9% 53.1%
Operating Profit Before Goodwill Amortisation and 46.0 38.9
Exceptional Items
Operating Profit Before Goodwill Amortisation and 14.3% 13.6%
Exceptional Items % of Turnover
Operating Profit 34.9 32.0
Pre-tax Profit 26.5 9.8
Financial Review
Profit And Loss Account
The Halfords Group has delivered strong results in the first half of this
financial year with total Group sales rising 12.7% to £322.7m (2003: £286.3m)
and like-for-like sales up 10.6%. Mezzanine conversions in the first half
contributed 0.3% to this like-for-like figure due to the timing of conversions
late in the second quarter.
Gross profit for the first half of this financial year at £170.8m (2003:
£151.9m) was 12.4% up on the comparable period last year and gross margin was
52.9% (2003: 53.1%) reflecting a strong sales performance from the Car
Enhancement category.
Net operating expenses before goodwill amortisation and exceptional items as a
percentage of turnover has fallen from 39.5% to 38.7%.
Operating profit before goodwill amortisation and exceptional items at £46.0m
(2003: £38.9m) represents an increase of 18.3% on the same period last year and
as a percentage of turnover has increased from 13.6% to 14.3%. Goodwill
amortisation at £6.9m is comparable to last year. In addition, an exceptional
non-cash charge of £4.2m was made in relation to share options exercised at the
time of the IPO.
Net interest payable for the first half of this financial year was £8.4m (2003:
£22.4m). Last year the Company was carrying much higher levels of debt before
its IPO. An exceptional interest charge of £1.7m (2003: £4.3m) was made to the
profit and loss account in respect of the accelerated write-off of the issue
costs associated with bank loans redeemed at the time of the IPO. On repayment
of the Halfords Group's existing borrowings it hedged its new borrowing
facilities using interest rate swaps. As a consequence, the Halfords Group
received £2.2m of exceptional income on the termination of its existing interest
rate swaps.
The taxation charge is based on an estimated effective tax rate of 32.1% on
profit before non tax-deductible goodwill amortisation and exceptional items for
the 52-week period ending 1 April 2005, less the associated tax credit of £1.8m
accruing to exceptional items.
Balance Sheet
The level of capital expenditure in the first half of this financial year was
£13.8m (2003: £6.4m), of which £5.1m (2003: Nil) related to the 22
supermezzanine store conversion programme and £2.7m (2003: £0.6m) for new stores
and resites.
As at 1 October 2004 the net value of stock was £116.9m (2003: £103.7m). The
Company has invested in stock levels to support the increased volume of turnover
and stock-turn is at a comparable level to last year.
Net debt at the end of the first half of this financial year was £183.8m (2003:
£354.6m) and net cash inflow from operating activities in the first half of this
financial year was £62.3m (2003: £75.7m).
Initial Public Offer and Refinancing
On 8 June 2004 the Company made a primary offer of 53,846,154 new ordinary
shares raising £140.0m before expenses. Costs of the IPO, which have been
treated as a deduction from share premium account, were £4.9m, resulting in net
proceeds of £135.1m.
On flotation, the Halfords Group utilised the net proceeds, together with its
own cash balances and a new banking facility to redeem £90.4m of deep discount
bonds, £0.4m of fixed rate subordinated unsecured loan notes and £279.7m of
secured bank loans.
The Halfords Group's new committed banking facilities are a £150.0m unsecured
five-year amortising term loan and a £120.0m revolving credit facility. The
Halfords Group incurred costs of £3.1m in respect of the arrangement of these
new banking facilities. These costs have been capitalised and will be amortised
over the term of the facilities.
At the time of the flotation, certain senior employees exercised their rights
over 2,527,307 ordinary shares that had previously been granted under a share
option scheme. In accordance with UITF 17, the Halfords Group has charged to
the profit and loss account the difference between the fair value of these
shares at the date of their grant and the amount paid by the employees,
resulting in an exceptional non-cash charge of £4.2m.
Dividend
An interim dividend of 3.7 pence per share will be paid on 10 January 2005 to
those shareholders on the share register as at 3 December 2004.
Operating Review
Sales growth has been achieved in all of the Company's four key product areas in
the 26 week period to 1 October 2004 when compared to the same period in the
previous financial year. In particular, the Company reported a strong
improvement in car enhancement sales with audio, satellite navigation and in-car
entertainment products also performing strongly. The car maintenance business
generated steady comparable growth and the Company continued to enjoy strong
growth in the areas of cycles and cycling accessories.
During March of this year a new outdoor leisure product range was rolled out to
all superstores. These products, which include camping equipment, have been well
received by customers and this has contributed to the growth of the overall
travel solutions range, providing a sound base for growth in this category to
build on in future years with a wider offer.
Moving forward, identifying new product areas remains a key element of the
Company's strategy to increase like-for-like sales. The Company's stated
strategy is to develop the business by leveraging its brands into new product
categories.
The Halfords Group also intends to continue to differentiate itself from its
competitors and attract new customers to stores by developing in-store services.
The 'We'll fit it' service, which promises to fit in-car entertainment
systems, car phones and other similar items continues to be expanded. To support
this service an extensive staff-training programme is being carried out, as well
as targeted advertising and expansion of the range of products for which the
fitting service is available.
The Company has made strong progress in changing its product sourcing. One key
objective has been to increase the volume of products that the Halfords Group
imports directly, particularly from the Far East. This has reduced cost prices
and has allowed the Company to re-invest these savings in lower retail prices to
provide better value for customers.
Store Portfolio
The Halfords Group was trading from 393 stores as at 1 October 2004, a net
increase in the first half of this financial year of 6 stores. 10 new stores
were opened and 4 stores closed in this period, with new stores, net of
closures, contributing 2.1% to first half-year sales growth.
At the end of the first half of this financial year, the Halfords Group traded
from 39 supermezzanine format stores, compared with 11 at the end of the
previous financial year. Of these, 22 stores were converted in the second
quarter. The Company remains on track to deliver 35 supermezzanine conversions
in the current financial year.
The Halfords Group continues to expand its markets and plans to open seven new
stores in the second half of which three are edge-of-town superstores in the
Dublin area of the Republic of Ireland.
Current Trading
Trading in the 6 weeks since 1 October 2004 remains in line with our
expectations and we remain confident about future prospects for the Company.
HALFORDS GROUP PLC
Consolidated Profit & Loss Account
26 weeks to 1 October 2004
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
Notes £m £m £m
Turnover 322.7 286.3 578.6
Cost of sales (151.9) (134.4) (269.0)
Gross profit 170.8 151.9 309.6
Net operating expenses (135.9) (119.9) (244.1)
Operating profit before goodwill amortisation
and exceptional operating items 46.0 38.9 79.2
Goodwill amortisation (6.9) (6.9) (13.7)
Exceptional operating items 2 (4.2) - -
Operating profit 34.9 32.0 65.5
Profit on disposal of fixed assets 2 - 0.2 6.4
Net interest payable, before net exceptional
interest income/(charges) (8.9) (18.1) (35.4)
Net exceptional interest income/(charges) 0.5 (4.3) (8.7)
Net interest payable 3 (8.4) (22.4) (44.1)
Profit on ordinary activities before taxation 26.5 9.8 27.8
Tax on profit on ordinary activities 4 (10.1) (5.7) (14.3)
Profit on ordinary activities after taxation 16.4 4.1 13.5
Equity dividends 5 (8.5) - -
Retained profit for the financial period 7.9 4.1 13.5
Earnings per share
Basic 6 8.0p 2.5p 8.3p
Diluted 6 8.0p 2.4p 8.0p
Earnings per share before
goodwill amortisation and exceptional items
Basic 6 12.3p 8.6p 17.7p
Diluted 6 12.3p 8.3p 16.9p
The results for the period are wholly attributable to continuing operations of
the Group.
The Group has no recognised gains and losses other than the profits above and
therefore no separate Statement of Total Recognised Gains and Losses has been
presented.
HALFORDS GROUP PLC
Reconciliation of Movements in Shareholders' Funds
26 weeks to 1 October 2004
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
£m £m £m
Profit for the financial period 16.4 4.1 13.5
Dividends (8.5) - -
7.9 4.1 13.5
Adjustment in respect of employee share options 4.2 - -
Proceeds from ordinary shares issued for cash 140.0 - -
Finance costs in respect of share issue (4.9) - -
Net movement in equity shareholders' funds 147.2 4.1 13.5
Opening shareholders' funds 4.5 (9.0) (9.0)
Closing shareholders' funds 151.7 (4.9) 4.5
HALFORDS GROUP PLC
Consolidated Balance Sheet
As at 1 October 2004
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
£m £m £m
Fixed assets
Intangible assets 246.2 260.0 253.1
Tangible assets 86.9 77.1 82.5
333.1 337.1 335.6
Current assets
Stocks 116.9 103.7 107.1
Debtors falling due within one year 23.5 22.1 23.5
Cash at bank and in hand 0.9 115.4 25.6
141.3 241.2 156.2
Creditors: amounts falling due within one year (176.0) (383.0) (293.8)
Net current liabilities (34.7) (141.8) (137.6)
Total assets less current liabilities 298.4 195.3 198.0
Creditors: amounts falling due after more than (143.0) (196.1) (190.2)
one year
Provisions for liabilities and charges (3.7) (4.1) (3.3)
Net assets/(liabilities) 151.7 (4.9) 4.5
Capital and reserves
Called up share capital 2.3 0.0 0.0
Share premium account 132.9 0.1 0.1
Profit and loss account 16.5 (5.0) 4.4
Equity shareholders' funds 151.7 (4.9) 4.5
HALFORDS GROUP PLC
Consolidated Cash Flow Statement
26 weeks to 1 October 2004
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
Notes £m £m £m
Net cash inflow from operating activities 7 62.3 75.7 114.8
Returns on investments and servicing of finance
Interest received 0.3 1.0 2.8
Interest paid (6.3) (14.3) (26.8)
Issue costs of new bank loan (3.1) - (2.5)
Net cash outflow from returns on investments and (9.1) (13.3) (26.5)
servicing of finance
Taxation (8.4) (1.8) (8.1)
Capital expenditure and financial investment
Purchase of tangible fixed assets (13.8) (6.4) (19.3)
Sale of tangible fixed assets - 0.2 6.9
Net cash outflow for capital expenditure and (13.8) (6.2) (12.4)
financial investment
Net cash inflow before use of liquid resources and 31.0 54.4 67.8
financing
Management of liquid resources
Reduction in short term deposits with banks - 20.0 20.0
Financing
Issue of ordinary share capital 140.0 - -
Costs in respect of share issue (4.9) - -
Capital element of finance lease obligations (0.1) - 0.8
Repayment of borrowings (370.5) (3.0) (146.9)
New borrowings 175.7 - 65.0
Net cash outflow from financing (59.8) (3.0) (81.1)
(Decrease)/increase in net cash (28.8) 71.4 6.7
Reconciliation of net cash flow to movement in net debt
Net debt at the beginning of the period 8 (349.5) (395.9) (395.9)
(Decrease)/increase in net cash (28.8) 71.4 6.7
Movement in deposits - (20.0) (20.0)
Movement in borrowings 198.0 3.0 83.6
Other non cash changes (3.5) (13.1) (23.9)
Net debt at end of the period 8 (183.8) (354.6) (349.5)
HALFORDS GROUP PLC
Notes to Interim Report
26 weeks to 1 October 2004
1. Accounting Policies
Basis of Preparation
The interim financial report and accounts for the 26 weeks to 1 October 2004 and
for the comparative 26 weeks to 26 September 2003 are unaudited and do not
constitute statutory accounts within the meaning of section 240 of the Companies
Act 1985.
Comparative figures for the 53 weeks ended 2 April 2004 have been extracted from
the statutory financial statements, which have been filed with the Registrar of
Companies. The auditors report on those financial statements was unqualified.
The financial information contained in this interim financial report has been
prepared under the historical cost convention, using accounting policies as set
out in the Halfords Group's financial statements for the period ended 2 April
2004 and are in accordance with applicable United Kingdom accounting standards.
2. Exceptional items
Operating exceptional items in the 26 weeks to 1 October 2004, relate to a
non-cash charge of £4.2m in respect of employee share options that were
exercised at the time of the Halfords Group's IPO.
Certain senior employees held options to subscribe for shares in the Company
under a share option scheme approved by shareholders on 19 November 2003. The
share options were exercisable only in the event of a Takeover, Sale or
Admission of the Company to a Relevant EEA market. Under the scheme, share
options were granted to senior employees on 12 December 2003 and 20 May 2004.
The shares required to meet the Company's obligation under the scheme were held
in trust. On 8 June 2004, senior employees exercised their rights over
2,527,307 shares.
In accordance with UITF 17, the Halfords Group has charged £4.2m, being the
difference between the fair value of the shares at the date of their grant and
the amount paid by the employees to exercise the share options. A corresponding
credit has been taken to the Halfords Group's profit and loss reserves.
The profit on disposal of £6.4m in the 53 week period ended 2 April 2004
principally relates to the sale of the head office building of Halfords Limited.
The building was acquired in the period and immediately sold then leased back.
£3.8m of the proceeds were deferred and are being amortised over the term of
the lease in accordance with UITF 28 'Operating lease incentives'.
3. Net interest payable
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
£m £m £m
Interest receivable and similar income:
Bank and similar interest (0.3) (1.3) (2.7)
Interest payable and similar charges:
Bank interest - - 0.4
Bank and other loans 7.2 11.7 23.5
Premium on deep discount bond 1.5 6.8 12.1
Interest on fixed rate subordinated unsecured loan - - 0.1
notes
Amortisation of issue costs on loans and deep 0.3 0.6 1.3
discount bonds
Commitment and guarantee fees 0.2 0.3 0.7
9.2 19.4 38.1
Exceptional amortisation of issue costs on loans and 1.7 4.3 8.7
deep discount bonds
Exceptional gain on close out of interest rate swap (2.2) - -
8.7 23.7 46.8
Net interest payable 8.4 22.4 44.1
On flotation (on 8 June 2004), the Halfords Group redeemed and replaced all of
its existing borrowings. As a consequence, a charge of £1.7m (26 weeks to 26
September 2003: £2.3m; 53 weeks to 2 April 2004: £6.3m) was made in respect of
accelerated amortisation of the issue costs associated with these borrowings.
On repayment of the Halfords Group's existing borrowings, the Halfords Group
hedged its new borrowing facilities using new interest rate swaps and received
£2.2m of exceptional income on the termination of its existing interest rate
swaps.
During the 53-week period to 2 April 2004 the Halfords Group repaid all of the
borrowings under its Mezzanine facility and repaid £68.2m of its deep discount
bonds. As a result £2.4m (26 weeks to 26 September 2003: £2.0m) of unamortised
issue costs associated with these borrowings was written off.
4. Tax on profit on ordinary activities
The taxation charge in the 26 weeks to 1 October 2004 is based on an estimated
effective tax rate of 32.1% on profit before non tax-deductible goodwill
amortisation and exceptional items for the 52-week period ended 1 April 2005,
less the associated tax credit of £1.8m accruing to exceptional items.
The tax charge exceeds the charge based on the statutory rate of UK corporation
tax of 30%, principally due to the non-deductibility of depreciation charged on
capital expenditure in respect of mezzanine floors and other store
infrastructure.
5. Dividends
The directors have approved an interim dividend of £8.5m (26 weeks to 26
September 2003: nil; 53 weeks to 2 April 2004: nil), which equates to 3.7 pence
per share and will be paid on 10 January 2005 to those shareholders on the share
register at the close of business on 3 December 2004.
6. Earnings per share
Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of ordinary shares in issue
during the period. In accordance with FRS 14 the weighted average number of
shares for the 26 weeks to 26 September 2003 and 53 weeks to 2 April 2004 have
been adjusted to reflect the bonus issues made at the time of the IPO.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all dilutive potential ordinary
shares. These represent share options granted to employees where the exercise
price is less than the average market price of the Company's ordinary shares
during the 26 weeks to 1 October 2004. In the period to 26 September 2003 and 2
April 2004 the dilutive potential ordinary shares were in respect of warrants
issued on 30 August 2002 that were exercised on 8 June 2004.
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2 April 2004
2003
Unaudited Unaudited Audited
m m m
Weighted average number of shares in issue 204.2 161.9 162.9
Weighted average number of dilutive shares options - 6.5 6.6
/warrants
Total number of shares for calculating diluted 204.2 168.4 169.5
earnings per share
The alternative measure of earnings per share is provided because it reflects
the Halfords Group's underlying trading performance by excluding the effect of
exceptional items and amortisation of goodwill.
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2 April 2004
2003
Unaudited Unaudited Audited
£m £m £m
Basic earnings 16.4 4.1 13.5
Exceptional items net of tax:
Operating profit 2.2 - -
Profit on disposal of fixed assets - - (4.5)
Interest (0.3) 3.0 6.1
Amortisation of goodwill 6.9 6.9 13.7
Underlying earnings before exceptional items and 25.2 14.0 28.8
amortisation of goodwill
Diluted earnings 16.4 4.1 13.5
Underlying diluted earnings before exceptional 25.2 14.0 28.8
items and amortisation of goodwill
7. Reconciliation of operating profit to net cash inflow from operating
activities
26 weeks to 26 weeks to 53 weeks to
1 October 2004 26 September 2003 2 April 2004
Unaudited Unaudited Audited
£m £m £m
Operating profit 34.9 32.0 65.5
Depreciation charge (net of profit/loss on 8.9 7.9 16.0
disposal)
Goodwill amortisation 6.9 6.9 13.7
Non cash charge for employee share schemes 4.2 - -
(Increase) in stock (9.8) (13.4) (16.8)
Decrease/(increase) in debtors - 1.5 (0.3)
Increase in creditors 17.2 40.8 36.7
Net cash inflow from operating activities 62.3 75.7 114.8
8. Reconciliation of movement in net debt
At 2 April 2004 Cash flow Other non cash At 1 October 2004
changes
Audited Unaudited
£m £m £m £m
Cash in hand and at bank 25.6 (24.7) - 0.9
Bank overdraft (7.1) (4.1) - (11.2)
18.5 (28.8) - (10.3)
Debt due within one year (182.2) 185.5 (38.2) (34.9)
Debt due after one year (185.0) 12.4 34.7 (137.9)
Finance leases due within one (0.2) 0.1 (0.1) (0.2)
year
Finance lease due after one year (0.6) - 0.1 (0.5)
Total Net Debt (349.5) 169.2 (3.5) (183.8)
The total debt cash outflow consists of £194.8m net repayment of borrowings and
£3.1m issue costs of new loans and £0.1m repayment of finance lease obligations.
Non-cash changes relate to the interest charges of £2.0m for the amortisation of
capitalised issue costs and £1.5m in respect of interest rolled into the
principal of the deep discount bonds.
9. Post Balance Sheet Event
In August 2001 Halfords Limited sold its garage servicing business to The
Automobile Association Limited ('AA'). Under the terms of the sale 124 garage
premises were sublet to GB Gas Holdings Limited by way of an underlease
agreement from Halfords Limited.
On 16 November 2004, the Halfords Group entered into an agreement with GB Gas
Holdings Limited and the AA. Under the agreement, the Halfords Group receives a
£4.0m premium in consideration for providing consent to the assignment of the
above underlease from GB Gas Holdings Limited to the AA and the subsequent
subletting by the AA of 49 premises to Nationwide Autocentres Limited.
10. Interim Statement
Copies of the interim statement are available from the registered office of the
Halfords Group, Icknield Street Drive, Washford West, Redditch Worcestershire,
B98 0DE.
Independent Review Report to Halfords Group PLC
26 weeks to 1 October 2004
Introduction
We have been instructed by the Company to review the financial information,
which comprises a consolidated profit and loss account, consolidated balance
sheet, consolidated cash flow statement, comparative figures and associated
notes. 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
responsible for preparing the interim report in accordance with the Listing
Rules of the Financial Services Authority which require that the accounting
policies and presentation applied to the interim figures should be 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 for use in the United Kingdom. A review
consists principally of making enquiries of 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. This report, including the conclusion, has been
prepared for and only for the company for the purpose of the Listing Rules of
the Financial Services Authority and for no other purpose. We do not, in
producing this report, accept or assume responsibility for any other purpose or
to any other person to whom this report is shown or into whose hands it may come
save where expressly agreed by our prior consent in writing.
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 26 weeks ended
1 October 2004.
PricewaterhouseCoopers LLP
Chartered Accountants
Birmingham
25 November 2004
This information is provided by RNS
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