Interim Results

FISH PLC 16 July 2001 FISH PLC Interim Results for the Six Months to 30 April 2001 Fish plc, the quoted restaurant operator of the 'Fish!' diner brand, today announces Interim results for the six months to 30 April 2001. * Group turnover, on continuing activities, increased by 40% to £8.408m (2000: £6.023m) * Operating profit, on continuing activities, increased sevenfold to £ 0.601m (2000: £0.071m) * Continued expansion of Fish! concept and on target to open 10 new Fish! diners this financial year, bringing the Group total to 16 by October 2001. * Rate of expansion programme set to increase with 12 new units due to open next year; site pipeline secured for 2002 and beyond with sites predominantly in London. * Latest openings in New Kings Road and Blackheath are performing above expectations; Putney and Leeds are performing in line; Battersea unit to be refocused as a training academy for staff which is core to future expansion * Epsom opened last week; additional new units scheduled to open in second half in Solihull, Wandsworth, Clerkenwell, Manchester and Marlow * The food preparation division continues to provide the necessary infrastructure to underpin the roll out programme * Due to success of accelerated expansion and openings, Paul Gilligan has been appointed as Chief Executive; Jeremy Ormerod resumes the position of Finance Director; and Eric Garnier becomes Operations Director Tony Allan, Chairman, commented: 'We have had a strong start to the year and are increasingly confident of the strength of the Fish! brand as we expand our presence nationwide. We remain on track to open at least 10 new units this year and will accelerate our opening programme to a minimum of 12 new units in 2002. 'The Directors remain confident that Fish! is well placed to maintain its growth momentum over the months ahead and are confident of a positive result for the full year.' 16 July 2001 ENQUIRIES: Fish plc Tel: 020 7234 3300 Tony Allan, Chairman Paul Gilligan, Chief Executive Jeremy Ormerod, Finance Director College Hill Tel: 020 7457 2020 Justine Warren Matthew Smallwood Chairman's Statement Fish plc has emerged in the current financial year as the operator of a single focused restaurant concept, with the unique underpinning of Cutty, its Specialist Food Group Division. The continued expansion of Fish! nationwide is the primary focus of the Group going forward and the site pipeline has already been secured for 2002 and beyond. Group Financial Performance Turnover on continuing activities grew to £8.408m (2000: £6.023m) reflecting the ongoing trading of Fish! and the specialist food division. These figures relate to continuing activities following the sale of the Group's signature restaurants last year. At the half year end eight Fish! diners were operational. Group operating profit, on a continuing basis, increased over the period to £601,000 (2000: £71,000), a sevenfold increase over last year. Profit before tax was £615,000 (2000: £759,000, including contribution from the Group's former signature restaurants). Earnings per share were 2.41p (2000: 1.75p after being restated for FRS19 - deferred tax). Dividend As was the case at the interim stage last year and in view of the cash required for the expansion programme, the rate of the return on capital expected from the new restaurants and the Company's continued intention to maximise its growth, the Board has decided to pay a final dividend for the year ending 31 October 2001 after a further six months trading. Restaurant Division Trading during the period under review benefited from the Group's increasing pace of expansion from new openings, in particular from those which commenced trading in the second half of last year, such as County Hall (opened late August 2000) and Guildford (opened October 2000). Three further units opened during the period under review in Birmingham (November 2000), Kings Road (April 2000) and Putney (April 2000) and this set of results includes initial contributions from these locations. Turnover from the core Fish! diner estate increased by 168% to £3.604m (2000: £1.343m) and operating profit increased by 190% to £0.862m (2000: £0.297m). The prototype Fish! diner at Borough Market continues to show an increase in both turnover and profit and like for like sales were up 5%. With the exception of Battersea, all of the Group's Fish! units that have been trading in excess of six months are in line with our model and performing to management expectations. Fish! in Battersea has continued to trade at breakeven levels and we have identified that this unit is better placed as a training academy for all our new staff. We will continue to offer a diner service at this location and expect to continue to run it on a breakeven basis. A training centre facility of this kind is key to the Group's expansion going forward and a function which was previously provided for at Bank Restaurant in Aldwych. The industry has experienced a notable fall in domestic custom and tourist numbers to the London restaurants in particular, as a result of the foot and mouth epidemic. However, we are particularly pleased that we have been able to achieve our sales and profit targets in spite of these unforeseeable factors and are confident that levels of trade will be maintained over the coming months. The Group's new locations which have opened since the year end have shown very encouraging levels of trading with all units achieving profitability within two months. There is demonstrable evidence that the Fish! brand has, indeed, got nationwide potential and our first two units to open outside London - in Guildford and in Birmingham - continue to outperform management expectations. The units in Fulham (New Kings Road) and Putney, both of which commenced trading in April, have been very well received in their respective ' neighbourhood' locations. Fish! in Fulham opened with weekly covers of 900 - trade has been maintained at this level which has encouraged us to continue to roll out our smaller, urban unit model. As we continue to expand the Fish! concept, the brand is proving itself to be both diverse and flexible, and suited to a wide variety of different sites and geographical locations. Our ongoing brand evaluation shows that Fish! performs to optimum levels where it has the benefit of outside dining space which will lead us to source future sites with the potential for 'al fresco' dining, wherever possible. In keeping with this strategy, a terrace with capacity for an additional 40+ diners has just been added to County Hall which along with Canary Wharf, has benefited from buoyant trade as a result of the good weather over recent weeks. New Openings Three additional Fish! units have opened since the half year end in Leeds (May), Blackheath (June) - which is a conversion of the Group's former 'Lawn' Restaurant, and Epsom (July). Initial signs show Blackheath trading well above expectations and business is beginning to build in Leeds. The Group's eleventh unit opened in Epsom last week and a further five new openings are planned between now and October 2001 in Solihull, Wandsworth, Clerkenwell, Manchester and Marlow, which will bring the Group total to 16 Fish! diners. The Group will open 12 additional units in the next financial year and sites have been secured for new openings well into 2002 and beyond. The Group is fully funded for its current roll out plans. In addition, a flagship retail Fish! shop has opened in Guildford. This is located on the ground floor of the Fish! diner site, the restaurant being on the top floor. The shop commenced trading in the first week of July. Located in a 400 sq. ft site, the total conversion cost of the retail unit was approximately £75,000. The shop offers the full range of wet fish, similar to the range sold at the Borough Market unit and at Jarvis, together with a range of exclusive household accessories, kitchen equipment and other food related products. The retail shop gives the Group an additional platform from which to market the Fish! brand and leverage additional retailing opportunities. We will continue to look for retail outlets where they complement a Fish! diner and are currently obtaining planning permission to develop a shop within the Blackheath diner. Specialist Food Division This division of the Group remains the key platform for the expansion of Fish! It continues to supply an increasing number of Fish! restaurants but also has an established client list of external custom. Turnover increased by 10% to £ 5.614m (2000: £5.100m) and operating profit rose 39% to £382,000 (2000: £ 274,000). However, Bentleys - the Group's specialist butchery division, suffered a predictable downturn in turnover as a result of the extended effect of the foot and mouth epidemic on hotels and restaurants in areas of high tourist footfall, and in London in particular. Brand Development We have continued to evaluate the Fish! brand throughout its roll out over the last two years. As a result, we have been able to produce a template for ' town' and 'city' Fish! models. Given the growth of the brand in town and city locations outside London and the targeting of sites in affluent suburbs, a suburban model has evolved which is a downscaled version of its larger London counterpart - typically accommodating 75 covers at a total development cost of under £0.5m. As the rollout progresses, we will continue to source sites in key London locations, as well as targeting cities with large populations (ie. in excess of 500,000 people) throughout the UK. These sites will typify the City model with capacity for 100-140 diners and a maximum fit out cost of £0.65m. The consequence of this accelerated expansion programme has been increasing economies of scale, together with improved prices from our various contractors, designers and equipment suppliers. Furthermore, brand awareness continues to grow with each new Fish! diner opened and the marketing of the retail shops will enhance this further. In addition, Fish! has been working with the Marine Stewardship Council (MSC) to raise awareness of the eco-friendly options available to consumers when purchasing seafood. The MSC is a body which assesses and recognises sustainably managed fisheries worldwide. Fish plc has passed the necessary, stringent qualifying standards to become the first restaurant group in the world to supply Alaskan Wild Salmon and to be endorsed by the MSC and as such, has been granted the right to carry the coveted MSC logo on its menus and marketing material. Board Changes Over the last six months, there has been an evolution within the Company of the roles carried out by executive directors. The continued expansion of Fish! nationwide remains the primary focus of the Group going forward. Consequently, the Board is pleased to announce that Paul Gilligan will become Chief Executive of the Group, with immediate effect. Since joining the Group from Pizza Express in August 2000, Paul has had direct responsibility for new restaurant site development and has overseen the expansion of the Fish! concept into the provinces. As a result, Jeremy Ormerod will resume the position of Finance Director and Eric Garnier, who has been largely responsible for the operational aspects of the roll out programme, will take up the role of Operations Director. Future Prospects Whilst the UK restaurant market remains competitive, the Group has had an encouraging start to the year. We continue to benefit from operating in an affordable sector of the market. Moreover, we are increasingly confident of the strength of the Fish! brand which continues to receive recognition and acceptance as we expand into wider geographical locations. The Group is on track to open at least 10 new units to which we committed by October 2001 and will look to increase its rate of expansion to a minimum of 12 units in the next financial year. The Directors remain confident that Fish! is well placed to maintain its growth momentum over the months ahead and are confident of a positive result for the full year. TONY ALLAN Chairman 16 July 2001 FISH PLC Interim Results for the Six Months to 30 April 2001 Group Profit and Loss Account For the Six Months to 30 April 2001 Dis- (As Continuing Continued restated) Unaudited Activities Activities Unaudited Audited Six Months Six months Six months Six months Year ended ended ended ended ended 30 April 30 April 30 April 30 April 31 Oct. 2001 2000 2000 2000 2000 £'000 £'000 £'000 £'000 £'000 Notes Turnover 8,408 6,023 4,889 10,912 20,971 Cost of sales (4,435) (3,350) (978) (4,328) (8,584) Gross profit 3,973 2,673 3,911 6,584 12,387 Administrative expenses (3,372) (2,602) (2,836) (5,438) (9,854) Operating profit 601 71 1,075 1,146 2,533 Exceptional item 3 - - (386) (386) (232) Interest receivable 55 43 - 43 26 Interest payable (41) (36) (8) (44) (108) Profit on ordinary activities before taxation 615 78 681 759 2,219 Tax on profit on ordinary activities (175) (441) (709) Profit on ordinary activities after taxation 440 318 1,510 Dividends 4 - (779) (962) Retained profit/ (loss) for period 440 (461) 548 Basic earnings per share 5 2.41p 1.75p 8.28p Diluted earnings per share 2.28p 1.67p 7.91p Group Statement of Total Recognised Gains and Losses Unaudited Unaudited Audited Six Six Year months months ended ended ended 30 April 30 April 31 Oct. 2001 2000 2000 £'000 £'000 £'000 Profit for the financial period 440 318 1,510 Prior period adjustment - - (239) Total recognised gains and losses 440 318 1,271 for the financial period Group Balance Sheet For the Six Months to 30 April 2001 Unaudited Unaudited Audited As at As at As at 30 April 30 April 31 October 2001 2000 2000 Notes £'000 £'000 £'000 Fixed assets Intangible 174 43 176 Tangible 11,554 13,703 9,029 11,728 13,746 9,205 Current assets Stock 1,427 1,686 1,342 Debtors - due within one year 4,693 5,313 16,036 Debtors - due after more than one 775 - 775 year Cash at bank 418 247 168 7,313 7,246 18,321 Creditors: amounts falling due (5,001) (7,963) (13,869) within one year Net current assets 2,312 (717) 4,452 Total assets less current 14,040 13,029 13,657 liabilities Creditors: amounts falling due after more than one year (161) (1,023) (307) Provisions for liabilities and (830) (490) (741) charges 991 1,513 1,048 Net assets 13,049 11,516 12,609 Capital and reserves Share capital 1,829 1,824 1,829 Share premium account 7,901 7,822 7,901 Merger reserve (1,375) (1,375) (1,375) Profit and loss account 4,694 3,245 4,254 Equity shareholders' funds 13,049 11,516 12,609 FISH PLC Interim Results for the Six Months to 30 April 2001 Notes to Interim Report 1. Basis of preparation The results for FISH plc for the six months ended 30 April 2001 and the comparative figures for the six months ended 30 April 2000 are unaudited. They have been prepared on accounting bases and policies that are consistent with those used in the preparation of the financial statements of the Group for the year ended 31 October 2000. The results for the year ended 31 October 2000 are extracted from the latest audited accounts approved by the Members at the Annual General Meeting. These accounts, which received an unqualified report, have been delivered to the Registrar of Companies. The unaudited Profit and Loss Account and Balance Sheet for the current and prior interim periods do not amount to statutory accounts within the meaning of section 240 of the Companies Act 1985 and have not been delivered to the Registrar of Companies. The comparative figures have been restated following the Group's decision to adopt FRS19 - Deferred Tax. The effect on the prior year figures is to increase the tax charge by £251,000. 2. Basis of consolidation The consolidated unaudited accounts for FISH plc incorporate the accounts of Cutty Catering Specialists Limited and Marchthistle Limited using the merger accounting method. Other Group subsidiaries are accounted for using the acquisition accounting method. 3. Dividend The prior year dividend in the Group's profit and loss account amounts to £779,000 which reflects the net assets in Crestport Limited transferred to QuadraNet plc. 4. Earnings per share Basic earnings per share for the six month ended 30 April 2001 has been calculated based on the weighted average number of shares in issue during the period of 18,290,144 and the earnings for the period of £440,000. Diluted earnings per share has been calculated based on the weighted average number of shares of 19,281,929 which includes the dilutive potential of shares under option. 5. Copies available Copies of the interim report will be sent to all shareholders and are available to the public from the Company's registered office at: 56 Ayres Street, London, SE1 1EU. For a period of fourteen days from 17 July 2001.

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