Final Results

Liberty PLC 22 September 2005 FOR IMMEDIATE RELEASE 22nd September 2005 LIBERTY PLC PRELIMINARY ANNOUNCEMENT OF RESULTS FOR THE YEAR ENDED 30th JUNE 2005 Contact: Iain Renwick, Chief Executive, Liberty Plc Tel: 020 7734 1234 Baron Phillips, Baron Phillips Associates Tel: 020 7920 3161 HIGHLIGHTS ---------- • Turnover increased by 11% to £43.8m - bucking the downturn in consumer spending experienced by other major retailers • Following property profits of £2.4m, pre-tax losses more than halved to £2.7m, down from £6.2m last year • Liberty now trading at break even at operating level • £66.5m of property sales entirely repaid debt - reducing annualised interest charges by £4m and rental income by a similar amount • Launch of 'Liberty of London' brand following highly successful expansion of design studio • 'Liberty of London' label spearheading transformation of Liberty into international luxury goods brand • Retailing activities to be focused into Tudor building on Great Marlborough Street and vacating existing Regent Street space 'We believe the business has been transformed over the past 12 months and the potential for future growth is substantial. Liberty is re-establishing itself as the destination retail centre for cutting edge design and style as well as a new player in the international luxury goods market,' Richard Balfour-Lynn, Chairman. CHAIRMAN'S STATEMENT for the year ended 30th June 2005 --------------------------------- This year has seen Liberty transformed into a vibrant and dynamic retail destination that is reversing its fortunes and becoming an international luxury goods brand. The sea change that has occurred reflects the determined effort of Liberty's experienced management team and is a result of almost two years of hard and, often, difficult work. Liberty is, once more, the home of cutting edge fashion and design and is receiving the approval of the buying public. Unlike almost every other major retailer, either in London's West End or High Streets across the country, Liberty has bucked the downturn in consumer spending. During the 12 months to 30th June 2005 Liberty's turnover increased by almost 11% to £43.8m producing an operating loss of £2.2m in comparison to a loss of £3.2m last year. I am pleased to report that at the operating level Liberty is now trading at break-even, which augurs well for the future. After realising £2.4m of profits on property sales this year, pre-tax losses have been reduced to £2.7m, against £6.2m last year. This pleasing performance demonstrates that Liberty has succeeded in offering discerning consumers a point of difference from other luxury goods retailers. We believe that our highly edited ranges - both in fashion and in other categories - are attracting customers looking to maintain their individuality, rather than acquiring goods merely with mass appeal. We have dared to be different and we are not offering high street conformity. Customers are also discovering, or, in many cases, re-discovering, that Liberty is a far easier place in which to shop than has been the case in the past. Wayfinding has improved and the store's layout is more logical and shopper friendly. Today there is much more to tempt London's high net worth individuals to cross Liberty's threshold. Apart from the strength of the underlying performance there have been two notable events during the year. In April 2005 we concluded the sale of £66.5m worth of property, which entirely repaid our debt and, as a result, significantly strengthened Liberty's balance sheet. The sale of Lasenby House in Kingly Street and the Liberty Island site on Regent Street, generated a pre-tax surplus of £2.4m after sale costs. By eliminating our £62m of debt, we will save almost £4m of annualised interest charges, although we will lose a similar amount of net annual rental income previously generated from these properties. Looking to the future we have spent much of the year under review designing in house a range of luxury goods under the 'Liberty of London' label. Our greatly expanded design studio has created the first of what we plan will become an extensive range of 'Liberty of London' goods which we believe will reflect both the store's deep design heritage as well as its ability to produce beautiful 'must have' items. The product development programme is producing new ranges of fashion accessories, such as bags and small leather goods, scarves, luggage and travel accessories, soft home furnishing, nightwear and stationery. The design team has successfully distilled the essence of Liberty while staying true to our uniquely English provenance and design heritage. We believe these luxury goods under the 'Liberty of London' brand will reflect our pioneering design spirit, showcasing the best in design while fusing fashion and the decorative arts. This is something Liberty's reputation was founded upon over a century ago. The full impact of our initial 'Liberty of London' collection will be felt during the course of the current year as our first range has only just been launched. This first collection has been well received by the fashion press and was launched in-store earlier this month. This has given the team great encouragement and confidence and we are looking to build the label and provide an extensive range of luxury accessories that will spearhead the drive to establish 'Liberty of London' as a truly international luxury brand. We have a clear strategy for focusing on the international expansion of the 'Liberty of London' brand. Our priorities are the North American, Japanese and South East Asian markets, with key routes to market and distribution partnerships being identified. This will enable us to market the brand on a global basis without the need for a substantial capital investment programme. At the same time we have worked hard on a programme of improving both the London store and the range of products we now offer. The sales figures demonstrate the success we have already had in Ladieswear, Menswear, Beauty and Accessories. During the second half of the year we unveiled our new look furnishing fabrics department with a more commercial focus and re-arranging of our home offer. I am pleased to report that both these areas are trading in line with our expectations and are, once more, establishing Liberty as a destination for home purchases. The impact of this success should not be underestimated as there is extensive competition in this area of our business and it is rewarding to see customers coming back to Liberty to purchase our furniture and related products. As part of our overall strategy of revitalising the Liberty brand, we intend focusing retailing activities into the Tudor building in Great Marlborough Street and vacating our existing Regent Street sales space. Under the terms of the sale agreement for the Regent Street property referred to earlier, we can achieve this without any residual rental liability to Liberty. This will result in the relocation of four key product areas from Regent Street: menswear, ladies shoes, lingerie and beauty. They will all be accommodated within the Tudor building but in a more tightly focused format to provide an improved product offering. We clearly see the Tudor building as the iconic brand home, which truly synthesises all the unique attributes of the Liberty brand. The focus on the Tudor building will enable us to develop innovative retailing strategies that add value to our luxury goods development, while creating a unique lifestyle destination in London's West End. We are excited about the potential. It is also important to sound a note of caution. Although we have performed well during a period of poor consumer confidence, London retailing has been affected by the terrorist events during July 2005. As a consequence, our trading performance in the flagship store during the first eleven weeks of our new financial year to 17th September 2005 was initially affected and turnover for that period was 5% lower than last year. However, our current turnover on a weekly basis is now almost back to the record trading levels of last year. While it is too early to be certain of the long-term impact of the summer's events we are adopting a cautious approach to current year trading. We are concerned that there has been virtually no co-ordination between Central Government, the Mayor of London's Office, and Westminster Council to provide a unified strategy aimed at encouraging consumers back to the West End. We believe one of the most effective methods of re-building consumer confidence is either the complete suspension of the Congestion Charge or suspending it during the peak pre-Christmas trading periods. Unfortunately simply raising the Congestion Charge, as is occurring at present, will do little to attract people back into the West End. Putting these issues to one side, we believe the business has been transformed over the past 12 months and the potential for future growth is substantial. Liberty is re-establishing itself as the destination retail centre for cutting edge design and style as well as a new player in the international luxury goods market. Richard Balfour-Lynn Chairman Liberty Plc 22nd September 2005 CONSOLIDATED PROFIT AND LOSS ACCOUNT for the year ended 30th June 2005 ------------------------------------ Year Year ended ended 30th June 30th June 2005 2004 Notes £'000 £'000 ------------------------------------------------------------------------------ Turnover 1 43,760 39,527 Cost of sales (24,754) (22,193) ------------------------------------------------------------------------------ Gross profit 19,006 17,334 Selling and distribution costs (21,317) (21,354) Administrative expenses (2,576) (2,919) Other operating income 2,710 3,353 ------------------------------------------------------------------------------ Operating loss on ordinary activities (2,177) (3,586) Operating loss before exceptional operating charges (2,177) (3,219) Exceptional operating charges 2 - (367) Profit on disposal of investment and operational properties 2,432 - ------------------------------------------------------------------------------ Profit/(loss) on ordinary activities before 255 (3,586) interest Net interest payable and similar charges 3 (2,925) (2,606) ------------------------------------------------------------------------------ Loss on ordinary activities before taxation (2,670) (6,192) Taxation charge on loss on ordinary activities 4 (651) (682) ------------------------------------------------------------------------------ Loss on ordinary activities after taxation (3,321) (6,874) Equity minority interests (245) (360) Non-equity minority interests (55) (55) ------------------------------------------------------------------------------ Loss attributable to ordinary shareholders (3,621) (7,289) Undeclared non-equity preference dividends (23) (23) ------------------------------------------------------------------------------ Retained loss for the year (3,644) (7,312) ============================================================================== Basic loss per share 5 (16.1p) (32.3p) Diluted loss per share 5 (15.7p) (32.3p) ============================================================================== All operations are continuing. CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES for the year ended 30th June 2005 ----------------------------------------------------------- Year Year ended ended 30th June 30th June 2005 2004 £'000 £'000 ------------------------------------------------------------------------------ Loss for the year (3,621) (7,289) Net revaluation surplus on fixed assets credited to revaluation reserve 5,513 3,464 Currency translation differences on foreign currency net investments (11) 5 ------------------------------------------------------------------------------ Total recognised gains and losses for the year 1,881 (3,820) ============================================================================== All recognised gains and losses are attributable to equity shareholders' interests. RECONCILIATIONS OF MOVEMENTS IN SHAREHOLDERS' FUNDS for the year ended 30th June 2005 --------------------------------------------------- 2005 2004 £'000 £'000 ------------------------------------------------------------------------------ Opening shareholders' funds 44,879 48,699 Loss for the financial year (3,621) (7,289) Undeclared non-equity preference dividends (23) (23) Net surplus on fixed assets credited to revaluation reserve 5,513 3,464 Currency translation differences on foreign currency net investments (11) 5 Unpaid non-equity preference dividends 23 23 ------------------------------------------------------------------------------ Closing shareholders' funds 46,760 44,879 ============================================================================== CONSOLIDATED BALANCE SHEET at 30th June 2005 -------------------------- 30th June 30th June 2005 2004 Notes £'000 £'000 ------------------------------------------------------------------------------ Fixed assets Intangible asset 18,200 18,200 Tangible assets 6 27,909 81,103 ------------------------------------------------------------------------------ 46,109 99,303 ------------------------------------------------------------------------------ Current assets Stocks 7 6,653 6,343 Debtors: amounts falling due after more than one year 2,050 878 amounts falling due within one year 6,091 5,869 Cash 3,630 4,490 ------------------------------------------------------------------------------ 18,424 17,580 Creditors: amounts falling due within one year 8 (13,580) (14,534) ------------------------------------------------------------------------------ Net current assets 4,844 3,046 ------------------------------------------------------------------------------ Total assets less current liabilities 50,953 102,349 Creditors: amounts falling due after more than one year 9 (1,745) (55,009) ------------------------------------------------------------------------------ Net assets 49,208 47,340 ============================================================================== Capital and reserves Called up share capital 6,036 6,036 Merger reserve 10 61,503 61,503 Revaluation reserve 10 4,528 12,337 Profit and loss account 10 (25,307) (34,997) ------------------------------------------------------------------------------ Total shareholders' funds 46,760 44,879 Analysed as: Equity shareholders' funds 46,260 44,402 Non-equity shareholders' funds 500 477 Equity minority interests 1,870 1,883 Non-equity minority interests 578 578 ------------------------------------------------------------------------------ 49,208 47,340 ============================================================================== CONSOLIDATED CASH FLOW STATEMENT for the year ended 30th June 2005 --------------------------------- 2005 2004 Notes £'000 £'000 ------------------------------------------------------------------------------ Net cash (outflow)/inflow from operating activities 11 (9,643) 520 Returns on investments and servicing of finance 12 (3,792) (2,640) Tax paid (635) (766) Capital expenditure and financial investment, less sales of fixed assets 13 65,227 (1,148) ------------------------------------------------------------------------------ Net cash inflow/(outflow) before financing and use of liquid resources 51,157 (4,034) Management of liquid resources 500 (500) Financing 14 (52,000) 4,000 ------------------------------------------------------------------------------ Decrease in cash during the year (343) (534) ============================================================================== RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT for the year ended 30th June 2005 ------------------------------------------------------- 2005 2004 Notes £'000 £'000 ------------------------------------------------------------------------------ Decrease in cash during the year 15 (343) (534) (Decrease)/increase in liquid resources 15 (500) 500 Decrease/(increase) in loans during the year 52,000 (4,000) ------------------------------------------------------------------------------ Decrease/(increase) in net debt during the year 51,157 (4,034) Translation differences 15 (17) 11 ------------------------------------------------------------------------------ Movement in net debt during the year 51,140 (4,023) Opening net debt (47,510) (43,487) ------------------------------------------------------------------------------ Closing net cash/(debt) 15 3,630 (47,510) ============================================================================== NOTES TO THE ACCOUNTS --------------------- 1. DIVISIONAL ANALYSIS Operating Operating result on result on ordinary ordinary activities activities before Net before Net Turnover interest assets Turnover interest assets 2005 2005 2005 2004 2004 2004 £'000 £'000 £'000 £'000 £'000 £'000 By class of business: Retail 31,016 (2,472) 43,766 27,139 (5,651) 44,894 Wholesale 12,744 2,727 5,442 12,388 2,065 2,446 ------------------------------------------------------------------------------------- 43,760 255 49,208 39,527 (3,586) 47,340 ===================================================================================== By geographical origin: United Kingdom 38,875 (617) 47,664 33,940 (4,774) 46,508 Japan 4,885 872 1,544 5,587 1,188 832 ------------------------------------------------------------------------------------- 43,760 255 49,208 39,527 (3,586) 47,340 ===================================================================================== By geographical destination: United Kingdom 32,273 28,571 Japan 4,885 5,585 Other 6,602 5,371 ------------------------------------------------------------------------------------- 43,760 39,527 ===================================================================================== Sales from concession departments are shown on a commission only basis as follows: 2005 2004 £'000 £'000 Gross turnover 49,118 45,213 Less concession departments turnover net of commission (5,358) (5,686) ------------------------------------------------------------------------------- Net turnover 43,760 39,527 =============================================================================== The segmental analysis of operations reflects the structure of the Group. Retail includes the UK retail operations at Regent Street and Heathrow. Wholesale includes the results of the UK and Japanese fabric businesses. The Retail loss before interest includes net rental income from properties and is after deducting exceptional operating charges. Cash balances of £3.6m in 2005 (£4.5m in 2004) and bank loans of £nil in 2005 (£49.7m in 2004) have been allocated to the Retail business as it utilises the cash balances and the buildings against which the debt was secured prior to its repayment during the year. 2. EXCEPTIONAL OPERATING CHARGES -------------------------------- 2005 2004 £'000 £'000 Redundancy and recruitment costs - 367 =============================================================================== 3. NET INTEREST PAYABLE AND SIMILAR CHARGES ------------------------------------------- 2005 2004 £'000 £'000 Interest payable on: Bank loans and overdrafts (2,549) (2,626) Loan from ultimate holding company (433) (35) Other interest payable (11) (19) ------------------------------------------------------------------------------- (2,993) (2,680) Less bank and other interest receivable 68 74 ------------------------------------------------------------------------------- (2,925) (2,606) =============================================================================== 4. TAXATION ON LOSS ON ORDINARY ACTIVITIES ------------------------------------------ 2005 2004 £'000 £'000 UK tax UK corporation tax on UK results (218) - Overseas tax Withholding tax written off (57) (232) Japanese tax on Japanese profits (345) (483) Adjustments in respect of prior years (31) 33 ------------------------------------------------------------------------------- (651) (682) =============================================================================== The tax credit on loss on ordinary activities has been reduced from the amount that would arise from applying the prevailing UK corporation tax rate as follows: 2005 2004 £'000 £'000 UK corporation tax credit at 30% on Group losses before tax 801 1,858 Permanently disallowable expenditure and unrelieved losses (396) (2,496) Taxation on chargeable gains in excess of accounting profits (2,066) - Withholding tax written off (57) (232) Taxation on overseas earnings at a higher rate than UK corporation tax (82) (126) Tax losses brought forward utilised in the year 1,999 208 Adjustments to taxation charge in respect of prior years (249) 33 Excess of capital allowances over/(under) depreciation (601) 73 ------------------------------------------------------------------------------- Current taxation charge (651) (682) =============================================================================== 5. LOSS PER SHARE ----------------- The loss per share figures are calculated by dividing the loss after taxation and minority interests for the year, by the weighted average number of shares in issue during the year, as follows:- 2005 2004 £'000 £'000 Loss on ordinary activities after taxation and minority interests (3,644) (7,312) =============================================================================== '000 '000 Weighted average number of ordinary shares in issue during the year 22,603 22,603 =============================================================================== Loss per share (16.1p) (32.3p) =============================================================================== The exercise price of the share options was less than the average share price for the year and therefore no adjustment to the earnings is necessary in respect of shares under option. However, the weighted average number of shares in issue is adjusted by 572,092 shares allocated to the share option schemes at 30th June 2005 to calculate the diluted loss per share. 6. TANGIBLE FIXED ASSETS ------------------------ Group ----- Short Freehold leasehold Fixtures & properties properties equipment Total £'000 £'000 £'000 £'000 Cost or valuation At 1st July 2004 35,550 42,623 7,597 85,770 Additions 120 - 1,142 1,262 Reclassifications - (74) 74 - Disposals (13,250) (45,052) (297) (58,599) Revaluation 2,188 2,503 - 4,691 -------------------------------------------------------------------------------------- At 30th June 2005 24,608 - 8,516 33,124 ====================================================================================== Depreciation At 1st July 2004 - (125) (4,542) (4,667) Charge for the year (561) (563) (949) (2,073) Disposals 76 351 276 703 Revaluation 485 337 - 822 -------------------------------------------------------------------------------------- At 30th June 2005 - - (5,215) (5,215) ====================================================================================== Net book value at 30th June 2005 24,608 - 3,301 27,909 ====================================================================================== Net book value at 30th June 2004 35,550 42,498 3,055 81,103 -------------------------------------------------------------------------------------- Valuation The Group's properties were valued at 31st December 2004 and 30th June 2005 by qualified professional valuers working for the company of DTZ Debenham Tie Leung, Chartered Surveyors, ('DTZ') acting in the capacity of External Valuers. All such valuers are Chartered Surveyors, being members of the Royal Institution of Chartered Surveyors. All properties were valued on the basis of Market Value and in accordance with the RICS Appraisal and Valuation Standards 5th Edition ('the Manual'). The valuation of the properties at 31st December 2004 was £81.3m and the valuation surplus reflected in the interim accounts was £4.2m. Two of the Group's properties were sold on 19th April 2005. A short leasehold property was sold for £53.7m and a freehold property was sold for £12.8m. These sales generated a net profit on sale of £2.4m after selling costs, which is included in the Consolidated Profit and Loss Account. The valuation of the remaining freehold property at 30th June 2005 was £24.8m (a valuation surplus £1.3m). The total valuation surplus credited to revaluation reserve during the year was £5.5m which is reflected in the table above. 7. STOCKS --------- Group Group 2005 2004 £'000 £'000 Raw materials 613 481 Work in progress - 25 Finished goods 6,040 5,837 ------------------------------------------------------------------------------- 6,653 6,343 =============================================================================== 8. CREDITORS: amounts falling due within one year 2005 2004 £'000 £'000 Trade creditors 8,124 7,122 Amounts owed to fellow Group undertakings 567 852 Corporation tax 48 251 Other taxes and social security 223 626 Other creditors 704 1,761 Non-equity minority interest dividend payable 28 27 Accruals and deferred income 3,886 3,895 ------------------------------------------------------------------------------- 13,580 14,534 =============================================================================== 9. CREDITORS: amounts falling due after more than one year ---------------------------------------------------------- 2005 2004 £'000 £'000 Bank loans - 50,000 Less issue costs - (282) ------------------------------------------------------------------------------- Bank loans net of debt issue costs - 49,718 Amounts owed to ultimate holding company - 2,031 Amounts owed to fellow Group undertakings - 3,194 Other creditors 1,745 66 ------------------------------------------------------------------------------- 1,745 55,009 =============================================================================== 10. MOVEMENT ON RESERVES ------------------------ Profit Merger Revaluation and loss reserve reserve account £'000 £'000 £'000 Group At 1st July 2004 61,503 12,337 (34,997) Loss retained for the year - - (3,644) Surplus arising on revaluation of properties - 5,513 - Currency translation differences on foreign currency net investments - - (11) Transfer of depreciation on revaluation of fixed assets - (56) 56 Transfer on sale of properties - (13,266) 13,266 Unpaid non-equity preference dividends - - 23 ------------------------------------------------------------------------------- At 30th June 2005 61,503 4,528 (25,307) =============================================================================== 11. RECONCILIATION OF OPERATING LOSS ON ORDINARY ACTIVITIES TO NET CASH INFLOW FROM OPERATING ACTIVITIES ------------------------------------------------------------------------------ 2005 2004 £'000 £'000 Operating loss on ordinary activities (2,177) (3,586) Depreciation 2,073 2,317 Loss on disposal of fixed assets 127 - Increase in stock (312) (804) (Increase)/decrease in debtors (1,437) 281 (Decrease)/increase in creditors (7,917) 2,312 ------------------------------------------------------------------------------- Net cash (outflow)/inflow from operating activities (9,643) 520 =============================================================================== 12. RETURNS ON INVESTMENTS AND SERVICING OF FINANCE --------------------------------------------------- 2005 2004 £'000 £'000 Equity dividend paid to minority interests (246) (224) Non-equity dividend paid to minority interests (53) (82) Interest paid (3,550) (2,408) Interest received 57 74 ------------------------------------------------------------------------------- (3,792) (2,640) =============================================================================== 13. CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT, LESS SALES OF FIXED ASSETS ---------------------------------------------------------------------------- 2005 2004 £'000 £'000 Purchase of tangible fixed assets (1,273) (1,148) Sale of tangible fixed assets 66,500 - ------------------------------------------------------------------------------- 65,227 (1,148) =============================================================================== 14. FINANCING ------------- 2005 2004 £'000 £'000 Loans drawn down 5,100 4,000 Loans repaid (57,100) - ------------------------------------------------------------------------------- (52,000) 4,000 =============================================================================== 15. ANALYSIS OF NET DEBT ------------------------ Movement Foreign during currency 2005 year translation 2004 £'000 £'000 £'000 £'000 Available cash 3,630 (343) (17) 3,990 Short term investments - (500) - 500 ------------------------------------------------------------------------------- Cash 3,630 (843) (17) 4,490 Loan from ultimate holding company - 2,000 - (2,000) Bank loan - 50,000 - (50,000) ------------------------------------------------------------------------------- 3,630 51,157 (17) (47,510) =============================================================================== 16. FINANCIAL INFORMATION ------------------------- The financial information set out above does not constitute the Company's statutory accounts for the period ended 30th June 2005 or 30th June 2004 but is derived from those accounts. Statutory accounts for 2004 have been delivered to the Registrar of Companies, and those for 2005 will be delivered following the Company's Annual General Meeting. The auditors have reported on those accounts; their reports were unqualified and did not contain statements under Section 237 (2) or (3) of the Companies Act 1985. 17. DESPATCH OF ACCOUNTS ------------------------ The audited accounts of the Company are expected to be sent to shareholders during October 2005. Thereafter copies will be available from the Company Secretary, Filex Services Limited, 179 Great Portland Street, London W1W 5LS. This information is provided by RNS The company news service from the London Stock Exchange

Companies

Seascape Energy Asia Plc (SEA)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today