Final Results

RNS Number : 0011L

Tasty PLC

29 April 2010

 



Tasty plc

Preliminary results for the 52 weeks ended 27 December 2009

Highlights

*        Revenue up 15% to £9,185,000 (2008 - £8,006,000)

*        Improvement in the trading position despite the adverse economic climate. 

*        Wildwood pizza, pasta and grill brand trading well.

*        Operating loss excluding pre-opening costs and non-trading items of £84,000 (2008 - loss £221,000)

*        Statutory pre-tax loss of £2,080,000 (2008 - loss £1,585,000)

Enquiries

Tasty plc                                                   Tel: [phone]

Jonny Plant, Chief Executive

Evolution Securities                                 Tel: [phone]

Bobbie Hilliam

Chairman's statement

I am pleased to report on the Group's results for 2009. During the year a former DimT restaurant was successfully re-branded into a Wildwood restaurant and a new Wildwood unit was also successfully opened, with a DimT unit closing at the beginning of the year.  The Group now has eleven restaurants in operation - 8 DimTs and 3 Wildwoods.

Results

Revenue for the 52 weeks ended 27 December 2009 was up 15% to £9,185,000 (2008 - £8,006,000).  Operating loss before pre-opening costs and non-trading items was £84,000 (2008 - loss £221,000).  Pre-opening costs for the period totalled £58,000 (2008 - £150,000). Non-trading items relate to an impairment of properties of £1,850,000 (2008 - £1,062,000), an onerous lease provision of £100,000 (2008 - £nil), a loss on disposal and a sub-letting of property of £nil (2008 - £167,000) and redundancy expenses of £9,000 (2008 - £94,000). The overall statutory pre-tax loss was £2,080,000 (2008 - loss £1,585,000).

The Board do not recommend payment of a dividend at this stage of the Group's development.

Openings

The Maidstone unit was re-branded as a Wildwood and re-opened in April and in June a new Wildwood was opened in Hornchurch.  The Group has just exchanged contracts for a new unit in Chelmsford which is expected to open in August 2010

Impairment

Due to the prevailing economic conditions, the Board has written down the value of some of its assets, which has resulted in a total impairment charge for the period of £1,850,000 (2008 - £1,164,000).

Cash flows

Net cash outflow for the period before financing was £752,000 (2008 - £2,660,000).  This is largely represented by capital expenditure on the expansion of the business through the opening of one site and rebranding of another. Cash flows from operating activities increased to £359,000 (2008 - £16,000).  During the period £nil (2008 - £1,883,000) was raised from a share issue.  Net cash and cash equivalents held at the end of the year were £1,850,000 (2008 - £2,602,000).

Review of the business

2009 has proved to be a year of consolidation.  The Group has continually looked to update the menus of both the DimT and Wildwood brands and for much of the year has successfully offered promotions to encourage growth in sales.

Management have continued to focus on food and labour margins throughout the year and these continue to be kept under constant review. This has resulted in an improvement in the trading position of the Group despite the adverse economic climate in the United Kingdom, when excluding non-trading items.

Non-trading items include a one-off redundancy expense of £9,000 (2008 - £94,000) together with property impairments of £1,850,000 (2008 - £1,062,000) and an onerous lease provision of £100,000 (2008 - £nil).  The impairments arise as a result of the Board's detailed evaluation of all units in order to ensure that each unit is shown in the Group's accounts at a conservative book value having regard to both capital and economic value considerations, particularly in the current prevailing economic market.  Pre-opening costs have been highlighted as these costs represent revenue expenses, including rent free periods,  which give rise to a charge under accounting standards, which are necessarily incurred in the period prior to a new unit being opened  but which are specific to the opening of that unit and not part of the Group's normal ongoing trading performance.

Staff

As ever, it is our dedicated staff that have contributed significantly throughout the year to the Group's performance, and I would like to take this opportunity of thanking them for their hard work and effort.

Current Trading

Since the year end trading has improved still further with a profitable first quarter in 2010.

……………………………………

Keith Lassman

Chairman

28 April 2010

Tasty plc

Consolidated Statement of Comprehensive Income for the 52 weeks ended 27 December 2009

	Note	2009		2008
		£'000		£'000
Revenue		9,185		8,006
Cost of sales		(8,781)		(7,717)
Gross profit/(loss)		404		289
Administrative costs		(2,505)		(1,983)
Operating loss excluding pre-opening costs and
non trading items		(84)		(221)
Pre-opening costs		(58)		(150)
Disposal and impairment of property, plant and equipment		(1,850)		(1,229)
Onerous lease provision		(100)
Redundancy expenses		(9)		(94)
Operating loss		(2,101)		(1,694)
Finance income		21		109
Loss before taxation		(2,080)		(1,585)
Income tax credit	3	6		6
Loss and total comprehensive income for the period
- attributable to equity shareholders		(2,074)		(1,579)
Loss per ordinary share
Basic and diluted	4	(5.49p)		(4.80p)

Tasty plc

Consolidated statement of changes in equity as at 27 December 2009

		Share		Share		Merger		Retained		Total
		capital		premium		reserve		deficit		Equity
		£'000		£'000		£'000		£'000		£'000
Balance at 30 December 2007		3,117		8,234		992		(3,349)		8,994
Total comprehensive income for the period		-		-		-		(1,579)		(1,579)
Issue of share capital (net of £117,000 issue costs		667		1,216		-		-		1,883
Share based payments - credit to equity		-		-		-		110		110
Balance at 30 December 2008		3,784		9,450		992		(4,818)		9,408
Total comprehensive income for the period		-		-		-		(2,074)		(2,074)
Share based payments - credit to equity		-		-		-		126		126
Balance at 27 December 2009		3,784		9,450		992		(6,766)		7,460

Tasty plc

Consolidated balance sheet at 27 December 2009

		2009		2009		2008		2008
		£'000		£'000		£'000		£'000
Assets
Non-current assets
Intangible assets		13				14
Property, plant and equipment		5,668				6,861
Pre-paid operating lease charges		731				767
Deferred tax asset		250				250
Other receivables		241				241
Total non-current assets				6,903				8,133
Current assets
Inventories		350				313
Trade and other receivables		537				505
Pre-paid operating lease charges		36				34
Cash and cash equivalents		1,850				2,602
Total current assets				2,773				3,454
Total assets				9,676				11,587
Liabilities
Non-current liabilities
Accrual for lease incentives		227				239
Total non-current liabilities				227				239
Current liabilities
Trade and other payables		1,889				1,940
Provisions		100				-
Total current liabilities				1,989				1,940
Total liabilities				2,216				2,179
TOTAL NET ASSETS				7,460				9,408
Capital and reserves attributable to
equity holders of the parent
Share capital				3,784				3,784
Share premium reserve				9,450				9,450
Retained deficit				(6,766)				(4,818)
Merger reserve				992				992
TOTAL EQUITY				7,460				9,408

Tasty plc

Consolidated cash flow statement for the 52 weeks ended 27 December 2009

		2009		2009		2008		2008
		£'000		£'000		£'000		£'000
Cash flows from operating activities
Loss for the period before taxation		(2,080)				(1,585)
Adjustments for:
Depreciation		474				386
Amortisation		2				2
Impairment losses		1,850				1,164
Onerous lease provision		100				-
Equity settled share-based payment
expense		126				110
Finance income		(21)				(109)
Cash flows from operating activities
before changes in working capital		451				(31)
Increase in trade and other receivables		(37)				(279)
Increase in inventories		2				(141)
(Decrease)/Increase in trade and other payables		63				461
Cash generated from operations				353				10
Income tax received				6				6
Net cash flows from operating activities
carried forward				359				16

Tasty plc

Consolidated cash flow statement for the 52 weeks ended 27 December 2009 (Continued)

		2009		2009		2008		2008
		£'000		£'000		£'000		£'000
Cash flows from operating activities
brought forward				359				16
Investing activities before taxation
Purchases of property, plant and
equipment		(1,131)				(2,779)
Purchase of intangible assets		(1)				(6)
Sale of property, plant and equipment		-				-
Interest received		21				109
Net cash outflow from investing
activities				(1,111)				(2,676)
Financing activities
Issue of ordinary shares (net of issue
costs of £nil - 2008 - £117,000)		-				1,883
Net cash from financing activities				-				1,883
Net decrease in cash and cash
equivalents				(752)				(777)
Cash and cash equivalents at beginning
of period				2,602				3,379
Cash and cash equivalents at end of
period				1,850				2,602

Notes to the preliminary announcement

1.	Basis of preparation The financial statements have been prepared in accordance with the accounting policies and presentation required by International Financial Reporting Standards, incorporating International Accounting Standards ("IAS") and Interpretations (collectively 'IFRS') as endorsed by the EU. They are presented in pounds sterling, rounded to the nearest thousand. The accounting policies used have been applied consistently to all periods presented and are the same as those set out in detail in the 2008 Report and Accounts, except for the adoption of IAS 1 Revised which has resulted in the Group presenting a single statement of comprehensive income. This has had no impact on the recognition or measurement of transactions and balances within the financial statements. The financial information set out above does not constitute the Group's statutory accounts for 2008 or 2009. Statutory accounts for the periods ended 27 December 2009 and 28 December 2008 have been reported on by the Independent Auditors.  The Independent Auditors' Report on the Annual Report and Financial Statements for 2008 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 237(2) or 237(3) of the Companies Act 1985.  The Independent Auditors' Report on the Annual Report and Financial Statements for 2009 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006. Statutory accounts for the period ended 28 December 2008 have been filed with the Registrar of Companies. The statutory accounts for the period ended 27 December 2009 will be delivered to the Registrar in due course.
2.	Non trading items
		2009		2008
		£'000		£'000
	Loss on sale of sublet of property, plant and equipment	-		167
	Provision for impairment	1,850		1,062
	Onerous lease provision	100		-
	Redundancy payments	9		94
		1,959		1,323
	During the year there were no site disposals or sublets  (2008 - the interest in one leasehold property was sublet for net costs of £65,000, and with £80,000 written off lease premiums and £22,000 impairing property, plant and equipment on the sublet). The Group has carried out an impairment review of the carrying values of plant, property and equipment, taking into account the current trading performance and anticipated future cashflows from individual cash generating units in accordance with IAS 36 Impairment of Assets. Impaired assets are carried at their recoverable amount which is the higher of fair value less costs to sell or their economic use in the business. The Group has identified certain sites where recent and anticipated performance in light of the economic downturn indicate they may have a value in use to the business below carrying value. The value in use to the business has been valued by discounting expected future pre-tax cashflows at 17% (2008 - 17%). The Group has also impaired assets to net realisable value where these are expected to be replaced on rebranding. As a result the Group's assets have been subjected to an impairment charge of £1,850,000 (2008 - £1,062,000) to write them down to what is deemed to be their recoverable amount, of which £nil (2008 - £512,000) represents lease premiums paid. Under IFRS lease premiums are normally treated as prepaid rent and expensed in the Statement of comprehensive income over the period of the lease.

3.	Tax on profit on ordinary activities
		2009		2008
		£'000		£'000
	(a)   Analysis of charge for the period
	Current tax
	UK corporation tax on profits of the period	-		-
	Adjustment in respect of prior period	(6)		(6)
	Current tax charge for the period	(6)		(6)
	Deferred tax
	Adjustment in respect of prior period	-		-
	Origination and reversal of temporary differences	-		-
	Total deferred tax	-		-
	Total income tax credit	(6)		(6)
	(b)  Factors affecting tax charge for the period
	The tax charge for the period is lower than the standard rate of corporation tax in the UK.       The differences are explained below:
		2009		2008
		£'000		£'000
	Loss on ordinary activities before tax	(2,080)		(1,585)
	Loss on ordinary activities multiplied by average
	standard rate of corporation tax in the UK of 21%
	(2008 - 20.75%)	(437)		(329)
	Effects of:
	Expenses not deductible for tax purposes	133		214
	Increase in unprovided tax losses carried forward	304		115
	Adjustment in respect of prior period	(6)		(6)
	Total tax credit (see (a) above)	(6)		(6)

4.	Loss per ordinary share (EPS)
		2009		2008
		£'000		£'000
	Numerator
	Loss for the period	(2,074)		(1,579)
	Denominator
		Number		Number
		'000		'000
	Weighted average number of ordinary shares (basic and
	diluted eps)	37,837		32,892
	Basic loss per ordinary share (pence)	(5.49p)		(4.80p)
	Diluted loss per ordinary share (pence)	(5.49p)		(4.80p)
	Basic and diluted earnings per share are the same as there is no dilution.  The 2,589,000 (2008 - 2,162,000) unexercised share options have not been included in the calculation of the loss per share as they are anti-dilutive.                Options are only taken into account when their effect is to reduce basic earnings per share or increase basic loss per share.  Since the Group has made a loss in the current and prior period the effect of taking into account potential ordinary shares would be to reduce the basic loss per share.  Share options have therefore been excluded in the calculation of diluted EPS.

 

END

 

 

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