Interim Results

RNS Number : 2914Q
Restaurant Group PLC
29 August 2014
 



The Restaurant Group plc

 

 

Interim results for the 26 weeks ending 29 June 2014

 

 

The Restaurant Group plc ("TRG" or "the Group") operates over 450 restaurants and pub restaurants.  Its principal trading brands are Frankie & Benny's, Chiquito, Coast to Coast and Garfunkel's. In addition it operates a Pub Restaurant businesses and a Concessions business which trades principally at UK airports.

 

·      Another strong financial performance:

* all results are stated excluding non-trading items

 

- Total revenue increased 10% to £308m (2013: £280m)

- Like-for-like sales increased by 2.5%

- Operating profit margins increased by 20bps

- EBITDA increased by 13.5% to £53.2m (2013: £46.9m)

- Profit before tax increased by 12.3% to £33.7m (2013: £30.0m)

- EPS rose 15% to 12.8p (2013: 11.2p)

- Operating cash flow of £55.9m (2013: £49.4m) 

 

·      Interim dividend increased by 16% to 6.1p per share (2013: 5.25p)

 

·      Acceleration of new site development:

- 17 new sites opened in the first half

- A further three new sites opened so far in the second half

- 38-43 new sites expected for 2014

 

·      Continued strong trading with year to date like-for-like sales for the 34 weeks to 24 August 2014 at 3.5%

 

·      Board is confident of another year of good progress in 2014

 

 

Andrew Page, Chief Executive of The Restaurant Group plc commented as follows:

 

"The Restaurant Group has delivered another record set of results, with double digit growth in earnings, dividends and cashflow.

 

These results reflect the hard work and efforts of all of the TRG team and I would like to record my thanks to them for delivering another outstanding performance.

 

The Restaurant Group is in great shape, I am confident that it will continue to prosper and I wish Danny and the TRG team well as they take the business forwards."

 

Danny Breithaupt, incoming Chief Executive, added:

 

"I am delighted to be taking on the leadership of TRG with the business in such great shape. TRG has a clear strategy, successful brands and a great team of people. This is a terrific platform for the further growth of the business, and I am looking forward to building on this and leading the Company through its next phase of development."

 

29 August 2014

 

Enquiries:

 

The Restaurant Group


Stephen Critoph, Group Finance Director

020 3117 5001



Instinctif Partners


Matthew Smallwood

020 7457 2020



Chairman's Statement

 

I am pleased to report that the Group has traded well during the first six months of the year, delivering strong growth across all of the key metrics, with sales, margins and profits all increasing.  Total sales grew by 10%, like-for-like sales were 2.5% ahead of the previous year (against tough comparatives), operating profit margins increased by 20bps and profits were 12.3% ahead.  This represents another strong performance from the Group.

 

Like-for-like sales grew in each of the first five months but were slightly negative for June, essentially as a result of the impact of the football World Cup.  Since the half year, like-for-like sales have grown strongly in July and August so that, for the 34 weeks to 24 August, the Group's like-for-like sales are 3.5% ahead of the prior year, which bodes well for a strong second half performance.

 

During the first six months of the year we opened 17 new restaurants and since June we have opened a further three restaurants.  Our new openings are performing strongly and we anticipate opening between 38 and 43 new restaurants during the year.

 

Trading results

During the first half the Group delivered increases in revenue, margins, profits and earnings per share.  Revenue increased by 10% to £308m, (2013: £280m), EBITDA increased by 13.5% to £53.2m (2013: £46.9m), operating profit increased by 12% to £34.9m (2013: £31.1m) and operating margins increased by 20bps to 11.3% (2013: 11.1%) reflecting strong sales, tight cost controls and a modest level of promotional activity.  Profit before tax increased by 12.3% to £33.7m (2013: £30.0m) and earnings per share increased by 15% to 12.8p (2013: 11.2p).  Again, profits have been converted into cash at a very healthy rate and, for the first half, operating cash flow was £55.9m (2013: £49.4m) with free cash flow of £35.8m (2013: £30.2m).

 

As a result of this good performance the Board is declaring an interim dividend of 6.1p per share (2013: 5.25p), an increase of 16%.  The interim dividend will be paid on 9 October 2014 to shareholders on the register on 12 September 2014 and the shares will be marked ex-dividend on 10 September 2014.

 

Frankie & Benny's (240 units)

Frankie & Benny's traded strongly during the first half to deliver a sizeable uplift in revenues and profits.  Frankie & Benny's enjoys a loyal and growing customer base as a result of its wide range of offerings, with great value for money and high levels of customer service.  As was the case last year, we have continued to experience an ongoing increase in the number of breakfasts sold and this additional trade is particularly helpful in terms of enhancing bottom-line profits.  We opened nine new restaurants during the first half and another one since the end of the first half.  The new openings are trading well and are set to deliver strong returns.  During 2014 we expect to open a total of between 18 and 21 new Frankie & Benny's restaurants.

 

Chiquito (74 units)

Chiquito performed well during the first half recording strong increases in both revenues and profits.  With the growing popularity of Tex-Mex cuisine and our focus on variety, authenticity, service and customer engagement, Chiquito continues to deliver good results.  During the first half we opened one new restaurant; it is trading strongly and is set to deliver high returns.  We have opened one further restaurant since the half year end, and expect to open a total of between seven and nine in the full year.

 

Coast to Coast (12 units)

Coast to Coast has performed strongly with a substantial increase in revenues and profits.  We have opened new restaurants in Rochester and Sheffield during the first half, both of which sit alongside existing Frankie & Benny's and Chiquito restaurants.  In each case our new Coast to Coast restaurants are trading superbly and are set to deliver strong returns. This further re-enforces our view that we have developed, with Coast to Coast, a new brand with significant growth prospects and one that complements our existing successful Frankie & Benny's and Chiquito brands. We had expected to open at least five new Coast to Coast restaurants during 2014. However, as a result of landlord and developer delays, at least three sites we had anticipated would open during 2014 will now open in the earlier part of 2015. Notwithstanding these delays we expect to open at least one further restaurant this year, and a substantially higher number in 2015.

 

Pub restaurants (50 units)

Our Pub restaurant business has delivered an outstanding performance in the first half with significant increases in revenue and profit.  As previously noted, we now have a well-established model for our Pub restaurant business which is scalable and capable of delivering sustained and high levels of return on investment.  During the first half we opened a new pub, the Aspinall Arms, near Clitheroe - its performance since opening has been exceptional and it is set to deliver strong returns.  Since the first half we have opened another new pub, The Red Lion, near Lichfield and we expect to open two more new pubs during the remainder of the year.

 

Garfunkel's (15 units)

Garfunkel's traded well during the first half and continues to deliver good levels of margins, profits and returns.  Although currently we do not have any new Garfunkel's planned for 2014, we are actively looking for potential new sites which will meet our criteria for returns on investment.

 

Concessions (62 units)

The Concessions business traded strongly in the first half delivering strong growth in revenues and profits.  UK passenger numbers ("pax") continue to increase, growing by 4.6% in the first six months of the year.  Once again, our Concessions business like-for-like sales growth outperformed UK pax growth over the first six months.  During the first half we opened four units which included taking over all of the catering at Southampton airport and launching our new Wondertree restaurant at the new Terminal 2 in Heathrow.  All of our new restaurants are trading well and are set to deliver strong returns.

 

It was recently announced that we have won tenders to open two new restaurants and a new bar at the re-developed Stansted airport.  These include a Coast to Coast restaurant (the first in a UK airport) and will open in early 2015.  During the remainder of 2014 we expect to open at least one more Concessions restaurant.

 

Non-trading item

On 17 April 2014 the Group disposed of part of its interest in the Living Ventures Group.  TRG received £7m of cash proceeds in respect of this disposal and the resulting profit on disposal of £6.9m, net of costs, is reported as a non-trading item in the first half of the year. The net proceeds of the disposal were distributed by way of a special dividend of 3.45p per share on 9 July 2014.  Following the disposal, TRG's only remaining interest in the Living Ventures Group is a £4m loan note which has already been fully provided against.

 

Cash flow and balance sheet

Cash generation was strong during the first half with net cash flow from operations of £55.9m (2013: £49.4m) and free cash flow (after interest, tax and maintenance capital expenditure) of £35.8m (2013: £30.2m), an increase of 19% on the comparable period last year.  Again, this clearly demonstrates the consistently strong cash flow generated by the Group, with a high rate of conversion of profits into cash.  This, combined with the consistently high returns being achieved on the capital which the Group invests in the new restaurants, enables us to continue to invest in a growing number of new restaurants whilst, at the same time, continuing to grow dividends at a rate significantly ahead of UK inflation and in line with the growth in our earnings per share.

 

During the first half total capital expenditure was £29.8m (2013: £27.3m).  Of this, £10.3m represented maintenance capital expenditure with the balance of £19.5m being invested in new developments.  In the full year we expect to open 38-43 new restaurants.  Including maintenance capital expenditure of approximately £20m, this will result in full year capital expenditure of £70-75m.

 

Outlook

These are strong results and reflect an outperformance against our sector.  The Group benefits from operating in market segments with barriers to entry which have proved to be very resilient.  We have a strong portfolio of complementary brands and have an impressive pipeline of new sites, in terms of both quality and quantity. These factors will ensure that the Group remains on track to double in size over the next eight to ten years. 

 

The second half has started well; year to date after 34 weeks total turnover is up 10.4% and like-for-like sales are up 3.5%.  With an improving economic outlook, lower inflation and higher levels of employment the prospects for TRG continue to look good.  I am confident that the Group is well placed to deliver another year of profitable progress.

 

Alan Jackson

Non-executive Chairman

29 August 2014

 



Notes to the Chairman's statement

 

1.   There are a number of potential risks and uncertainties which could have an impact on the Group's performance over the remaining six months of the financial year and which could cause actual results to differ materially from expected and historical results. These have not materially changed from those set out on page 14 of our latest Annual Report and Accounts which can be found on the Group website: www.trgplc.com/recent-announcements.

 

2.   Summary trading income statement:


26 weeks

Ended 29

June 2014

£m

26 weeks

Ended 30

June 2013

£m

% change

Revenue

307.9

280.4

9.8%

Cost of sales

(254.3)

(231.3)


Pre-opening costs

(1.4)

(1.0)






Gross profit

52.2

48.1

8.4%

Administration costs

(17.3)

(17.0)






EBITDA

53.2

46.9

13.5%

Depreciation

(18.3)

(15.8)






Operating profit

34.9

31.1

12.0%

Operating margin

11.3%

11.1%


Net interest

(1.2)

(1.1)






Profit before tax

33.7

30.0

12.3%

Tax

(8.0)

(7.6)






Profit after tax

25.7

22.4

14.8%





EPS (pence)

12.80

11.16

14.7%

 

 

3.   Summary cash flow:

 


26 weeks

to 29 June 2014

£m

26 weeks to 30 June 2013

£m

 

Operating profit

 

34.9

 

31.1

Working capital & non-cash adjustments

2.7

2.5

Depreciation

18.3

15.8




Net cash flow from operations

55.9

49.4

Net interest paid

(0.6)

(0.5)

Tax paid

(9.2)

(8.4)

Maintenance capital expenditure

(10.3)

(10.3)




Free cash flow

35.8

30.2

Development capital expenditure

(19.5)

(17.0)

Movement in capital creditors

(6.3)

(2.3)

Disposal of investment in associate

7.0

-

Net cash flow from share issues

-

0.5

Purchase of shares

(5.3)

(2.3)

Other items

0.9

(0.2)




Change in net debt

12.6

8.9

Net bank debt at start of period

(41.9)

(36.0)




Net bank debt at end of period

(29.3)

(27.1)

 

 

 

 

 

The Restaurant Group plc Interim report 2014

Condensed financial statements

Consolidated income statement


26 weeks ended 29 June 2014



Trading

Non-




business

trading

Total



(unaudited)

(unaudited)

(unaudited)


Note

£'000

£'000

£'000






Revenue


307,910

-

307,910






Cost of sales:





Excluding pre-opening costs


(254,340)

-

(254,340)

Pre-opening costs


(1,420)

-

(1,420)



(255,760)

-

(255,760)






Gross profit


52,150

-

52,150






Administration costs


(17,290)

(138)

(17,428)






Trading profit


34,860

(138)

34,722






Disposal of investment in associate

2

-

7,000

7,000






Earnings before interest, tax, depreciation and amortisation:


53,210

6,862

60,072






Depreciation


(18,350)

-

(18,350)






Operating profit


34,860

6,862

41,722






Interest payable


(1,216)

-

(1,216)

Interest receivable


64

-

64






Profit on ordinary activities before tax


33,708

6,862

40,570






Tax on profit from ordinary activities

3

(8,031)

30

(8,001)






Profit for the period


25,677

6,892

32,569











Earnings per share (pence)





Basic

4

12.80


16.23

Diluted

4

12.78


16.21

 

 

 

 

 

Consolidated income statement


26 weeks ended 30 June 2013



Trading

Non-




business

trading

Total



(unaudited)

(unaudited)

(unaudited)


Note

£'000

£'000

£'000






Revenue


280,443

-

280,443






Cost of sales:





Excluding pre-opening costs


-

(231,305)

Pre-opening costs


(1,033)

-

(1,033)



(232,338)

-

(232,338)






Gross profit


48,105

-

48,105






Administration costs


(16,980)

-

(16,980)






Trading profit


31,125


31,125






Disposal of investment in associate

2

-

-

-






Earnings before interest, tax, depreciation and amortisation:


46,881

-

46,881






Depreciation


(15,756)

-

(15,756)






Operating profit


31,125

-

31,125






Interest payable


(1,243)

-

(1,243)

Interest receivable


132

-

132






Profit on ordinary activities before tax


30,014

-

30,014






Tax on profit from ordinary activities

3

(7,654)

-

(7,654)






Profit for the period


22,360

-

22,360











Earnings per share (pence)





Basic

4

11.16


11.16

Diluted

4

11.14


11.14

 

 

 

 

 

Consolidated income statement


52 weeks ended 29 December 2013



Trading

Non-




business

trading

Total



(audited)

(audited)

(audited)


Note

£'000

£'000

£'000






Revenue


579,589

-

579,589






Cost of sales:





Excluding pre-opening costs


-

(469,729)

Pre-opening costs


(3,784)

-

(3,784)



(473,513)

-

(473,513)






Gross profit


106,076

-

106,076






Administration costs


(31,160)

-

(31,160)






Trading profit


74,916


74,916






Disposal of investment in associate

2

-

-

-






Earnings before interest, tax, depreciation and amortisation:


107,791

-

107,791






Depreciation


(32,875)

-

(32,875)






Operating profit


74,916

-

74,916






Interest payable


(2,447)

-

(2,447)

Interest receivable


216

-

216






Profit on ordinary activities before tax


72,685

-

72,685






Tax on profit from ordinary activities

3

(16,495)

-

(16,495)






Profit for the period


56,190

-

56,190











Earnings per share (pence)





Basic

4

28.02


28.02

Diluted

4

27.97


27.97

 

 

 

 

Consolidated statement of changes in equity










Share

Share

Other

Retained

Total


capital

premium

reserves

earnings



£'000

£'000

£'000

£'000

£'000







Balance at 30 December 2013

56,432

24,491

(8,940)

143,982

215,965







Profit for the period

-

-

-

32,569

32,569

Issue of new shares

-

-

-

-

-

Dividends

-

-

-

-

-

Share-based payments - credit to equity

-

-

1,522

-

1,522

Employee benefit trust - purchase of shares

-

-

(5,272)

-

(5,272)

Other reserve movements

-

-

(386)

-

(386)

Current tax on share-based payments taken directly to equity

-

-

-

1,024

1,024

Deferred tax on share-based payments taken directly to equity

-

-

-

(446)

(446)













Balance at 29 June 2014 (unaudited)

56,432

24,491

(13,076)

177,129

244,976













Balance at 31 December 2012

56,334

24,027

(7,737)

111,224

183,848







Profit for the period

-

-

-

22,360

22,360

Issue of new shares

89

412

-

-

501

Dividends

-

-

-

-

-

Share-based payments - credit to equity

-

-

2,013

-

2,013

Employee benefit trust - purchase of shares

-

-

(2,291)

-

(2,291)

Other reserve movements

-

-

(1,847)

-

(1,847)

Current tax on share-based payments taken directly to equity

-

-

-

888

888

Deferred tax on share-based payments taken directly to equity

-

-

-

66

66













Balance at 30 June 2013 (unaudited)

56,423

24,439

(9,862)

134,538

205,538













Balance at 31 December 2012

56,334

24,027

(7,737)

111,224

183,848







Profit for the year

-

-

-

56,190

56,190

Issue of new shares

98

464

-

-

562

Dividends

-

-

-

(24,863)

(24,863)

Share-based payments - credit to equity

-

-

2,947

-

2,947

Employee benefit trust - purchase of shares

-

-

(2,291)

-

(2,291)

Other reserve movements

-

-

(1,859)

-

(1,859)

Current tax on share-based payments taken directly to equity

-

-

-

950

950

Deferred tax on share-based payments taken directly to equity

-

-

-

481

481













Balance at 29 December 2013

56,432

24,491

(8,940)

143,982

215,965

 

 

 

 

Consolidated balance sheet









At 29 June 2014

At 30 June 2013

At 29 December 2013


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000





Non-current assets




Intangible assets

26,433

26,433

26,433

Property, plant and equipment

347,935

305,377

337,519


374,368

331,810

363,952





Current assets




Stock

4,684

4,068

5,085

Trade and other receivables

7,408

4,957

7,794

Prepayments

12,530

13,074

14,601

Cash and cash equivalents

4,047

2,909

7,307


28,669

25,008

34,787





Total assets

403,037

356,818

398,739









Current liabilities




Corporation tax liabilities

(7,344)

(7,502)

(9,725)

Trade and other payables

(96,567)

(89,363)

(103,780)

Other payables - finance lease obligations

(329)

(329)

(330)

Provisions

(1,025)

(1,864)

(1,120)


(105,265)

(99,058)

(114,955)





Net current liabilities

(76,596)

(74,050)

(80,168)





Non-current liabilities




Long-term borrowings

(33,321)

(30,016)

(49,164)

Other payables - finance lease obligations

(2,908)

(2,865)

(2,885)

Deferred tax liabilities

(13,155)

(15,682)

(12,524)

Provisions

(3,412)

(3,659)

(3,246)


(52,796)

(52,222)

(67,819)





Total liabilities

(158,061)

(151,280)

(182,774)





Net assets

244,976

205,538

215,965









Equity




Share capital

56,432

56,423

56,432

Share premium

24,491

24,439

24,491

Other reserves

(13,076)

(9,862)

(8,940)

Retained earnings

177,129

134,538

143,982

Total equity

244,976

205,538

215,965

 

 

 

 

Consolidated cash flow statement



26 weeks ended 29 June 2014

26 weeks ended 30 June 2013

52 weeks ended 29 December 2013



(unaudited)

(unaudited)

(audited)


Note

£'000

£'000

£'000






Operating activities





Cash generated from operations

6

49,600

47,101

116,838

Interest received


64

132

216

Interest paid


(707)

(649)

(1,308)

Tax paid


(9,172)

(8,400)

(17,700)

Net cash flows from operating activities


39,785

38,184

98,046






Investing activities





Purchase of property, plant and equipment


(29,756)

(27,364)

(76,626)

Disposal of fixed assets


983

-

(400)

Disposal of investment in associate


7,000

-

-

Net cash flows used in investing activities


(21,773)

(27,364)

(77,026)






Financing activities





Net proceeds from issue of ordinary share capital


-

501

562

Employee benefit trust - purchase of shares


(5,272)

(2,291)

(2,291)

Net repayments of loan draw downs

7

(16,000)

(19,000)

-

Dividends paid to shareholders


-

-

(24,863)

Net cash flows used in financing activities


(21,272)

(20,790)

(26,592)






Net decrease in cash and cash equivalents


(3,260)

(9,970)

(5,572)






Cash and cash equivalents at the beginning of the period


7,307

12,879

12,879






Cash and cash equivalents at the end of the period


4,047

2,909

7,307

 

 

 

 

Responsibility Statement

 

We confirm that to the best of our knowledge:

 


 

(a)  the condensed set of financial statements has been prepared in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting';

 


 

(b)  the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first 26 weeks and description of principal risks and uncertainties for the remaining 26 weeks of the year); and

 


 

(c)  the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).

 


 

By order of the Board,

 

 

Alan Jackson

Stephen Critoph ACA

 

Non-executive Chairman

Group Finance Director

 

29 August 2014

29 August 2014

 

 

 

 

 

 

Accounting policies

Basis of preparation

The annual financial statements of The Restaurant Group plc are prepared in accordance with International Financial Reporting Standards ("IFRSs") as adopted by the European Union.  The condensed set of financial statements included in this interim financial report has been prepared in accordance with IAS 34 'Interim Financial Reporting', as adopted by the European Union.  The accounting policies and methods of computation used are consistent with those used in the Group's latest annual audited financial statements.


General information

The comparatives for the full year ended 29 December 2013 do not constitute statutory accounts as defined in section 434 of the Companies Act 2006.  A copy of the statutory accounts for that year has been delivered to the Registrar of Companies.  The auditor's report on these accounts was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.


Going concern

There continue to be economic uncertainties facing the United Kingdom and consumer-facing industries in particular.  Potential risk factors and uncertainties that could affect the business are discussed in the Chairman's statement.  The Group has a debt facility of £140m which matures in October 2016 and had net debt at 29 June 2014 of £29.3m.  Based on the Group's plans for the next 12 months and after making enquiries (including preparation of reasonable trading forecasts, consideration of current financing arrangements and current headroom for liquidity and covenant compliance), the Directors have a reasonable expectation that the Group has adequate resources to continue operations for the foreseeable future.  For this reason they continue to adopt the going concern basis in preparing the condensed financial statements.


Changes in accounting policies

Except as noted, the same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest annual audited financial statements.


At the date of approval of the condensed set of financial statements, the following new standard, which has not been applied and when adopted will have no material impact on the financial statements of the Group, was in issue but not yet effective:


- IFRS 15 "Revenue from contracts with customers"

 

 

 

 

Notes to the condensed financial statements


1 Segmental analysis

The Group trades in one business segment (that of operating restaurants) and one geographical segment (being the United Kingdom).  The Group's brands meet the aggregation criteria set out in paragraph 22 of IFRS 8 "Operating Segments" and as such the Group report the business as one reportable segment.


2 Non-trading items

On 17 April 2014 The Restaurant Group disposed of part of its interest in The Living Ventures group following the sale of the Gusto business.


The Group received £7m of cash proceeds in respect of this disposal and the resulting profit on disposal of £6.9m, net of costs, is reported as a non-trading item in the 26 weeks ended 29 June 2014. The net proceeds of the disposal were distributed by way of a special dividend of 3.45 pence per share on 9 July 2014.  Following the disposal, TRG's only remaining interest in the residual business is a £4m loan note which has been fully provided against as a result of a detailed review of the trading performance of the business.


There were no non-trading items in the 26 weeks ended 30 June 2013 or the 52 weeks ended 29 December 2013.

 

3 Tax

The tax charge has been calculated by reference to the expected effective current and deferred tax rates for the full financial year to 28 December 2014 applied against the profit before tax for the period ended 29 June 2014.  The full year effective tax charge on the underlying trading profit is estimated to be 23.8% (2013: 22.7%).


The Finance Act 2012 introduced a reduction in the main rate of corporation tax from April 2014 from 23% to 21% resulting in a blended rate of 21.5% being used to calculate the estimated tax liability for the 52 weeks ended 28 December 2014.  A further rate reduction to 20% from April 2015 was substantively enacted on 2 July 2013 therefore the deferred tax provision at the balance sheet date has been calculated at 20%.



 

4 Earnings per share


26 weeks ended 29 June

2014

26 weeks ended 30 June

2013

52 weeks ended 29 December 2013


Earnings

Weighted average number of shares

Per-share amount

Earnings

Weighted average number of shares

Per-share amount

Earnings

Weighted average number of shares

Per-share amount


(unaudited)

(unaudited)

(unaudited)

(unaudited)

(unaudited)

(unaudited)

(audited)

(audited)

(audited)


£'000

millions

pence

£'000

millions

pence

£'000

millions

pence











Basic earnings per share

32,569

200.6

16.23

22,360

200.4

11.16

56,190

200.5

28.02

Effect of dilutive options

-

0.4

(0.02)

-

0.4

(0.02)

-

0.4

(0.05)

Diluted earnings per share

32,569

201.0

16.21

22,360

200.8

11.14

56,190

200.9

27.97











Basic earnings per share

32,569

200.6

16.23

22,360

200.4

11.16

56,190

200.5

28.02

Effect of non-trading items

(6,892)

-

(3.43)

-

-

-

-

-

-

Earnings per share - trading business

25,677

200.6

12.80

22,360

200.4

11.16

56,190

200.5

28.02

 

 

 

 

5 Dividends

Following approval at the Annual General Meeting on 15 May 2014, the final dividend in respect of 2013 of 8.75p per share, totalling £17.4m, was paid to shareholders on 9 July 2014.  In addition, a special dividend of 3.45p per share, totalling £7.0m, was paid following the disposal of part of the investment in the Living Ventures Group and the £7m cash proceeds received (see note 2).


The Directors have declared an interim dividend of 6.10p per share which will be paid on 9 October 2014 to ordinary shareholders on the register at close of business on 12 September 2014.  In accordance with IAS 10, this will be recognised in the reserves of the Group in the second half of the year.

 

6 Reconciliation of profit before tax to cash generated from operations



26 weeks ended 29 June 2014

26 weeks ended 30 June 2013

52 weeks ended 29 December 2013


(unaudited)

(unaudited)

(audited)


£'000

£'000

£'000





Profit before tax

40,570

30,014

72,685

Net finance charges

1,152

1,111

2,231

Disposal of investment in associate

(6,862)

-

-

Share-based payments

1,522

2,013

2,947

Depreciation

18,350

15,756

32,875

Decrease / (increase) in stocks

401

804

(213)

Decrease in debtors

2,457

4,385

21

(Decrease) / increase in creditors

(7,990)

(6,982)

6,292





Cash generated from operations

49,600

47,101

116,838

 

 

7 Bank loans

The Group has a committed bank facility of £140m in place until October 2016.  During the 26 weeks ended 29 June 2014, the Group reduced its draw down under this facility by £16.0m (26 weeks ended 30 June 2013: reduction of £19.0m, 52 weeks ended 29 December 2013: no change).


8 Share capital

Share capital at 29 June 2014 amounted to £56.4m.  The number of shares allotted, called up and fully paid remained at 200,647,143 as no share options were exercised in the 26 weeks to 29 June 2014.


9 Related party transactions

BH Restaurants Limited (formerly Living Ventures Restaurants Group Limited) was a related party to The Restaurant Group plc through the Group's 37.4% holding until 17 April 2014 when the Group disposed of it's interest in the company.  In the 26 weeks ended 29 June 2014, the Group received £7.0m cash and £0.1m of loan note interest, all of which was recognised in the income statement (26 weeks ended 30 June 2013: £0.1m of interest all of which was recognised in the income statement, 52 weeks ended 29 December 2013: £0.2m of interest all of which was recognised in the income statement).  For more details, see note 2.


10 Contingent liabilities

There were no significant changes in the nature and size of contingent liabilities at 29 June 2014 to those reported in the Annual Report and Accounts for the 52 weeks ended 29 December 2013.

 

 

 

INDEPENDENT REVIEW REPORT TO THE RESTAURANT GROUP PLC

 

We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the 26 weeks ended 29 June 2014 which comprises the consolidated income statement, the consolidated statement of changes in equity, the consolidated balance sheet, the consolidated cash flow statement and related notes 1 to 10. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

 

This report is made solely to the company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board.  Our work has been undertaken so that we might state to the company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.

 

Directors' responsibilities

 

The half-yearly financial report is the responsibility of, and has been approved by, the Directors.  The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

As disclosed in the accounting policies, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union.  The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union.

 

Our responsibility

 

Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.

 

Scope of review

 

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

 

Conclusion

 

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the 26 weeks ended 29 June 2014 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Conduct Authority.

 

Deloitte LLP

 

Chartered Accountants and Statutory Auditor

 

London, UK

 

29 August 2014

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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