TIDMDTG
RNS Number : 5767J
Dart Group PLC
18 July 2013
DART GROUP PLC
PRELIMINARY UNAUDITED RESULTS FOR YEAR ENDED 31 MARCH 2013
Dart Group PLC (the "Group"), the Leisure Airline, Package
Holidays and Distribution & Logistics Group, announces its
preliminary results for the year ended 31 March 2013. These results
are presented under International Financial Reporting Standards
("IFRS").
CHAIRMAN'S STATEMENT
I am pleased to report on the Group's trading for the year ended
31 March 2013. Turnover grew by 27% to GBP869m (2012: GBP683m) and
profit before tax amounted to GBP40.5m (2012: GBP28.1m). Earnings
per share increased 36% to 21.73p (2012: 16.01p).
The Board maintains a conservative approach to dividend policy,
ensuring that funds are retained to support further business
growth, whilst recognising the need to provide a return to
shareholders. With this in mind, and in consideration of the
Group's improved trading performance, the Board recommends a final
dividend of 1.33p per share (2012: 0.89p). If approved at the
Annual General Meeting, to be held on 5 September 2013, this
dividend will be payable on 18 October 2013 to shareholders on the
register at the close of business on 13 September 2013. The
associated ex dividend date will be 11 September 2013.
The significant growth in turnover particularly reflects the
expansion of Jet2holidays, the Group's package holiday business,
which increased its holiday customers by 93% to 417,390 (2012:
216,520) in the year. The business continues to gain momentum,
recording a profit before tax of GBP6.8m (2012: GBP2.5m) on the
back of an increase in turnover to GBP244.8m (2012: GBP114.5m).
Profits in Jet2.com, the leisure airline business, increased to
GBP29.3m (2012: GBP21.7m) as overall demand for seats, boosted by
demand from Jet2holidays, resulted in higher load factors and
increased yields. Our important and long-established Distribution
& Logistics business, Fowler Welch, improved operating margins
and achieved a profit before tax of GBP4.4m (2012: GBP3.9m).
Capital expenditure for the year was GBP79.7m (2012: GBP47.3m),
which related principally to the acquisition of seven aircraft,
including two Boeing 737-800s, for following year fleet growth and
long-term maintenance spend on aircraft and engines. Net cash flow
from operating activities amounted to GBP150.3m (2012: GBP94.5m),
primarily reflecting growth in Jet2.com and Jet2holidays forward
bookings, which grew in line with planned capacity increases for
the year ending 31 March 2014.
As at 31 March 2013, the Group's cash balances, including money
market deposits, were GBP220.9m (2012: GBP152.0m), at which point
Jet2.com and Jet2holidays had received circa GBP253m (2012:
GBP180m) of advance payments from customers in respect of their
future flights and holidays. The Group manages its cash very
carefully, not least because of the restrictions placed on it by
the UK Civil Aviation Authority, which requires the Group to
maintain certain levels of "available liquidity", which is defined
as free cash plus available facilities.
In addition, the Group's cash and money market deposits include
cash which is restricted by its merchant acquirers as collateral
against a proportion of forward bookings paid for by credit or
debit card. These balances are considered to be restricted until
the respective customers have travelled.
On 29 April 2013, we were pleased to welcome Gary Brown to the
position of Group Chief Financial Officer and then to appoint Gary
to the Board of Dart Group PLC on 17 June 2013. Prior to joining
the Group, Gary had been Global Chief Financial Officer at Umbro
PLC and had held a number of senior positions in the retail and
consumer goods sector.
Our previous Finance Director, Andrew Merrick, left us on 11
April 2013 after six years with the Group. We wish him well for the
future and thank him for his valued contributions.
Leisure Airline & Package Holidays
We continue to make good progress in both our leisure airline
and package holidays businesses. Whether customers choose to buy an
airline seat only, or a fully inclusive package holiday, we do our
best to give them great service from the moment they book. Our
staff are "happy to help" and conscious that they are an important
part of the often long anticipated and eagerly awaited holiday
experience.
In the summer of 2012 Jet2.com, our leisure airline, flew from
our eight Northern bases to 51 Mediterranean, Canary Island and
leisure City destinations. The Company operated 45 passenger
aircraft of which 37 were owned by the Group. A further 5 aircraft
were purchased during the year, and 2 purchased since the reporting
date, to meet planned expansion for summer 2013.
We offer two distinct products: seat-only, which is almost
exclusively sold through the Jet2.com website and package holidays,
which are sold through the Jet2holidays website, travel agents and
our own call centre. Demand is stimulated by extensive online and
direct marketing - particularly TV. The Group is now the UK's third
largest ATOL (Air Travel Organisers' Licencing) holder. Our ATOL
determines the number of package holidays we are licensed to sell
annually by the UK Civil Aviation Authority.
At Jet2.com our seat-only product offers friendly low fares with
convenient flight times, allocated seating and a 22 kilo baggage
allowance. At check-in we aim to have a speedy experience with no
queues and often there are customer helpers to assist. When on
board, our cabin staff are intent on ensuring that the holiday
starts and finishes with a relaxed and friendly flight. At many
destinations our own staff will be present to greet customers and
ensure their holiday gets off to a great start.
If the customer has chosen a Jet2holiday, they will normally be
flown to the resort in a Jet2.com operated aircraft, so ensuring
that we control the quality of the flight product. Then they will
be transported to their hotel in Jet2holidays contracted busses,
many of which are branded in our colours. With over 1,500 3-5 star
hotels to choose from, often with adjacent water parks and other
great attractions, and with a range of options from bed and
breakfast to all inclusive there is an offer to suit most tastes.
In the year to 31 March 2013 we took over 417,000 customers on
package holidays, and current booking rates indicate that we will
double that in the current financial year. Our core principles are
to be family friendly, offer great value for money and give best in
class customer service.
On 1 January 2013, I was delighted to appoint Stephen Heapy,
then Chief Commercial Officer to the position of Chief Executive of
Jet2.com and Jet2holidays and, on 17 June 2013, to the board of
Dart Group PLC. Steve joined us in November 2009 from Libra Travel,
where he held the position of Product, Commercial and Operations
Director and prior to that he was the Managing Director of Thomas
Cook's scheduled business. Since joining, Steve has driven the
successful growth of our holiday business and now through his
leadership of both the seat-only and package holiday products he is
in the position to ensure our businesses, together, give the best
possible products and value. We are confident that under Steve's
leadership, and with our enthusiastic and growing team, we will
deliver a really wonderful holiday experience for our
customers.
On 6 June 2013, we were very pleased to announce that we had
been notified by Royal Mail that, subject to contract, Jet2.com has
retained contracts for six out of the eight Postal Air Network
routes currently operated. The Group has been operating flights for
Royal Mail through its subsidiaries since 1980, helping them to
ensure First Class mail achieves next day delivery throughout the
UK. The current contracts with Royal Mail are due to terminate in
2014.
As notified in the Company's results for the year ended 31 March
2012, Jet2.com was invited to retender, along with a number of
other airlines, for Royal Mail's revised network from 2014. As a
result of the competitive retender process, there has been an
expected reduction in the contribution from this business that will
be enjoyed by the Group going forward. However, retaining
approximately 75% of its Royal Mail business represents a positive
outcome for the Group and is regarded as a reflection of the very
high service levels maintained over many years.
In our leisure airline and package holiday businesses we believe
that by providing great value for money and best in class service
and concentrating on the Mediterranean, Canary Islands and European
leisure cities from our Northern catchment area, we will both
retain existing Jet2.com and Jet2holidays customers and attract
many new ones, thereby continuing our profitable growth.
Distribution and Logistics
The Group's distribution business, Fowler Welch is one of the
UK's leading providers of distribution and logistics services
across the food supply chain, serving retailers, growers, importers
and manufacturers through its network of 11 distribution sites,
encompassing circa 1m square feet of warehouse space. The Company's
main distribution centres are in key produce, growing and importing
areas - Spalding in Lincolnshire, Teynham in Kent and Hilsea in
Portsmouth. Our very significant ambient (non temperature
controlled) distribution centre is at Heywood near Bury, Greater
Manchester and there are two regional sites in Washington, Tyne and
Wear and Newton Abbott, Devon.
I am pleased to report the significant progress that has been
made at our Heywood distribution centre, which was purchased by the
Group in May 2010. This operation is now materially contributing
towards the Company's profits. We were also delighted to sign a new
long-term lease for our Hilsea, Portsmouth site, which has enabled
us to make appropriate investment to improve this facility, in
order to meet the high standards required by our customers. Fowler
Welch operates over 450 distribution vehicles, which are
supplemented to meet seasonal demand.
The Company prides itself on its high standards of customer
service, much of which is in the demanding temperature controlled
food sector. However, increasingly Fowler Welch is also developing
its ambient business, leveraging its operating disciplines to offer
the same high standards of service in this sector too.
The current opportunity for Fowler Welch is to grow its business
through the development of its existing infrastructure and to
attract customers through its price competitive, operational
expertise, delivered by dedicated professionals. Everything is in
place to achieve careful but determined growth. Our sales force has
been significantly enhanced and there is an encouraging pipeline of
prospective new customers, along with further opportunities for
business growth from existing customers. This will mean some
additional infrastructure spend as enhancements are made to our
existing distribution sites. With its strong management team and
highly professional workforce, we believe that the Company is
really well positioned to take advantage of exciting opportunities
in its sectors.
Outlook
Each of our businesses have great opportunities in their
respective marketplaces together with strong and energetic
management in place. Jet2holidays is set for further growth in the
current year, with forward bookings at encouraging levels. We have
expanded Jet2.com's flying programme by 12% for summer 2013,
although margins will continue to remain challenging in this
sector. Fowler Welch will continue to focus on developing a strong
pipeline of future revenue opportunities whilst improving its
operational efficiency as a result of system developments.
We are encouraged both by our business opportunities and the
start we have made to the current year but as always, in the
current economic environment, we remain cautiously optimistic in
respect of profit growth.
Philip Meeson
Chairman
18 July 2013
BUSINESS AND FINANCIAL REVIEW
The Group comprises three principal operating businesses,
Leisure Airline, Package Holidays and Distribution & Logistics,
the Package Holidays and Leisure Airline operations working closely
together to provide a range of leisure travel services to our
Northern UK customer base.
2012/13 performance
The Group's financial performance for the year to 31 March 2013
is reported in line with International Financial Reporting
Standards ("IFRS"), as adopted by the EU, which were effective at
31 March 2013.
Group profit before tax increased 44% to GBP40.5m (2012:
GBP28.1m) in the year ended 31 March 2013 reflecting improved
trading in all three businesses. Overall Group turnover increased
by 27% to GBP869.2m (2012: GBP683.0m), with growth in all segments,
including a 114% rise in Package Holiday revenues. Continued focus
on the quality of our revenue, operational efficiencies and cost
control meant that operating profit grew by 33% to GBP37.9m (2012:
GBP28.5m). Group EBITDA increased by 33% to GBP83.4m (2012:
GBP62.9m).
The Group's effective tax rate of 23% (2012: 19%) was lower than
the headline rate of corporation tax, because a future headline
rate reduction has lowered the Group's deferred tax liability.
The Group generated net cash inflows(a) of GBP68.9m in the year
(2012: GBP45.2m), resulting in a positive cash position, including
money market deposits, of GBP220.9m (2012: GBP152.0m) as at 31
March 2013. Total cash received from Jet2holidays and Jet2.com
customers in advance of their trips, amounted to circa GBP253m
(2012: GBP180m) at year end.
The Group's cash generation was principally driven by the
Leisure Airline and Package Holidays operations, which continue to
benefit from strong forward bookings.
Capital expenditure increased from GBP47.3m to GBP79.7m,
principally the result of increased expenditure on aircraft
additions to meet the needs of the summer 2013 flying programme and
the long term maintenance of aircraft. The airline purchased seven
aircraft in total, including two Boeing 737-800s, two 757-200s and
three 737-300s, compared to the previous year's addition of five
Boeing 737-300s.
The Group manages its cash position very carefully, not least
because of the restrictions placed on it by the UK Civil Aviation
Authority, which requires the Group to maintain certain levels of
"available liquidity", which is defined as free cash plus available
facilities. The Group's cash and money market deposits include cash
which is restricted by its merchant acquirers as collateral against
a proportion of forward bookings paid for by credit or debit card.
These balances are considered to be restricted until the respective
customers have travelled.
The Group's balance sheet continues to strengthen, driven by
both profit performance in the year and cash generation from
advance bookings; deferred revenue grew 59% year on year, as the
Group's leisure travel businesses continue to enjoy strong forward
bookings. The resulting increase in shareholders' equity, the
improved gross cash position and the increase in non-current assets
are the principal changes in the balance sheet from the previous
year end. The overall increase in shareholders' equity does not
equate to the Group's post tax profit for the year, due to a
reduction in the market value of outstanding fuel and currency
hedges at the year-end relative to the previous year. The business
continues to be funded in part by payments received in advance of
travel from our leisure customers.
Subsequent to the reporting date, the Group concluded the
renewal of its financing facilities with a consortium of banks.
Note (a): Cash flows are reported including money market
deposits (cash deposits with maturity of more than three months) to
give readers an understanding of total cash generation. The
Consolidated Group Cash Flow Statement reports net cash flow
excluding the movement on these deposits.
Segmental performance
Leisure Airline
The Leisure Airline business trades under the Jet2.com brand and
operates scheduled flights to a range of leisure destinations from
its home base at Leeds Bradford International Airport, and Belfast
International, Blackpool, East Midlands, Edinburgh, Glasgow,
Manchester and Newcastle airports.
Total Leisure Airline turnover, including sales of seats to
Jet2holidays, increased by over 20% to GBP556.2m (2012: GBP461.3m).
This reflected a 13% increase in scheduled passengers to 4.84
million (2012: 4.27 million) and a 16% increase in per passenger
ticket yield to GBP59.67 (2012: GBP51.47). Retail revenue
(non-ticket revenue) grew to GBP30.96 (2012: GBP27.86).
Careful route scheduling and capacity management meant that,
although costs grew by 20%, operating profit increased by 23% to
GBP26.7m (2012: GBP21.7m). Year on year fuel costs per passenger
improved by 3%. The underlying price of fuel was maintained due to
favourable US dollar exchange rates mitigating the increase in the
average fuel hedge rate.
During the year, Jet2.com continued the expansion of its
scheduled airline network. The addition of two aircraft enabled the
business to expand at its newest base, Glasgow airport. Two further
aircraft additions permitted flight programme extensions at East
Midlands and Manchester airports, increasing the frequency of
flights to tried and trusted Jet2.com destinations. The airline now
flies to 51 destinations in 19 different countries and operated a
total of 173 (2012: 145) routes in the year, adding the new popular
destinations of Pula and Grenoble.
Though overall scheduled airline seat capacity increased by 10%
in the year, careful route scheduling and capacity management
coupled with continued growth in customer demand, resulted in load
factors increasing to 90% (2012: 87%). This load factor improvement
was in part underpinned by the sale of seats to Jet2holidays which
represented 17% (2012: 10%) of total scheduled flying in the year.
Net ticket revenue increased to GBP59.67 from GBP51.47 as a higher
proportion of flights to "far sun" destinations and the continued
development of the airline's revenue management system resulted in
further improvement in the business's quality of earnings.
Retail revenue per passenger increased to GBP30.96 from
GBP27.86. This was generated from a number of sources, including
hold baggage charges for a sector leading 22kg weight allowance,
advance seat assignment, extra leg room seats, in-flight sales and
commissions on car hire and travel insurance. Retail revenue
performance was optimised through our customer contact programme
and dynamic pricing, which takes into account factors such as
destination, trip duration, and lead time to departure in order
that customers are offered the best products and prices for their
particular needs.
As part of Jet2.com's continued focus on great customer service,
Edinburgh and Glasgow Airport passenger handling moved in-house for
winter 2012. In addition aircraft dispatchers at Manchester airport
were also added to core staff as part of our drive to continue to
improve operational efficiency and on-time performance.
To ensure that every employee understands the business's brand
values and customer service proposition, a company-wide employee
engagement programme called 'Take Me There' was delivered. As a
result every employee in the business has received training on the
importance of delivering customer service excellence at every point
on the customer journey.
Jet2.com is proud to undertake significant flying for Royal
Mail. Night mail flights, performed with industry leading
punctuality levels, are undertaken every weekday from six UK
airports. As announced on 6 June 2013, the airline successfully
retendered and retained six out of the eight routes we currently
operate past the termination date of the current agreement in 2014.
Though there has been a reduction in the margin that will be
enjoyed by the airline going forward, this was anticipated, and the
Royal Mail business will continue to form a valuable, though
reducing, proportion of the operating profit of the airline.
As part of a continuous drive to operate more effectively,
Jet2.com continues to improve its fuel efficiency by means of its
wide-ranging "efficient flying" programme. This programme looks at
all aspects of the airline's operation which can influence or
directly impact upon the operational efficiency of its flying
activities. The combined effects of all the elements of this scheme
are estimated to have saved the airline over 10,135 (2012: 34,000)
tonnes of carbon emissions in the year.
At the reporting date, Jet2.com operated a fleet of 46 aircraft
with the Group having acquired two Boeing 757-200 aircraft - one of
which was operated under a lease prior to purchase - three Boeing
737-300s and two Boeing 737-800 aircraft towards the end of the
financial year. Two leased 737-300 aircraft were returned at the
end of their leases during the year. Jet2.com will continue to add
to its owned and leased fleet in line with demand from our Northern
based Jet2.com and Jet2holidays customers. Seat capacity has been
increased by a further 12% for summer 2013, with growth focused on
tried and trusted, great value destinations.
Package Holidays
Jet2holidays is the Group's package holiday operator; it is an
integral part of the Group's leisure travel activities, working
closely with Jet2.com to provide ATOL protected holidays to a wide
range of destinations from our eight Northern UK airports.
The business has achieved considerable growth since its
inception in 2007 and is now the third largest tour operator in the
United Kingdom. In what was another successful year, revenue
increased 114% to GBP245m (2012: GBP115m). This has been
predominantly driven by an increase in customer numbers, with over
417,000 customers enjoying great value package holidays in the year
(2012: 216,000). This growth is a reflection of the successful
further development of the Jet2holidays hotelproduct range and a
fully integrated approach with Jet2.com, whose increased capacity
has been directed to meet the demand from Jet2holidays customers
for holidays in the Mediterranean, the Canary Islands and great
leisure cities. Our customers continue to demand great value but
are not willing to reduce quality. The Jet2holidays product range
has been expanded with over 45% of customers staying at "4 star" or
greater, supported by the early success of our "Indulgent Escapes"
brand, which has driven further revenue growth in the year.
Despite the challenging economic environment and a highly
competitive market place, gross margins per holiday have been
maintained through the careful management and further development
of our Package Holidays yield management system. The increasing
scale of the business has enabled the business to improve both
operating margins and profitability, with profit before tax
increasing to GBP6.8m (2012: GBP2.5m).
Jet2holidays are sold over the internet, from the business's UK
based call centre, and through high street and online travel
agents; each of these channels is proactively supported and
nurtured. The award-winning Jet2holidays.com website is
continuously developed to improve the quality of both the customer
and the trade booking experience. Website visits are significantly
higher than the previous year and conversion rates continue to
improve. We doubled the size of our UK-based call centre during the
year and will continue to invest in this area to ensure the
successful handling of call volume growth which has continued into
the summer 2014 booking season. Sales through travel agents remain
an important element of the business and Jet2holidays can now be
booked through all major travel consortia, key multiples,
homeworker companies and independents in the North of the UK.
Looking forward to the year ending 31 March 2014, the business
expects further growth in customer numbers as its marketing
strategy and focus on customer service excellence continue to build
brand resonance in its key markets and retain valuable repeat
business. Jet2holidays is benefitting from its family-focused
approach, including free child places at hundreds of hotels, which,
alongside a low deposit and a payment plan offering, has proven to
be very attractive in the current economic environment. The
significant investment in marketing has paid dividends with
bookings for summer 2013 already surpassing last year. Furthermore,
the brand and product awareness continues to be improved by
focussing on quality TV advertising, and intelligent use of social
media and other online channels of communication. This continued
investment in the product offering, together with the opportunity
to cross sell to Jet2.com scheduled service customers, means that
the business remains confident in delivering its growth plans.
Controlling the business's own supply chain, by means of direct
relationships with over 1,500 hotels, and the focus on Jet2holidays
as part of Jet2.com's overall capacity planning, have been
fundamental to recent success and the business will continue to
ensure that it has the product and capability to meet its predicted
increases in demand.
Distribution & Logistics
The Group's distribution business, Fowler Welch, is one the UK's
leading logistics providers to the food supply chain industry,
serving retailers, growers, importers and manufacturers across its
network of eleven sites strategically located to balance supply and
demand. A full range of added value services is provided including
storage, case level picking and an award winning national
distribution network.
Revenues rose in the year by 1.8% to GBP155.2m. The quality of
earnings in the year improved as organic volume growth and new
business offset any revenue losses. Operational efficiency
continued to improve with average miles per gallon increasing to
8.7 (2012: 8.6) and accident damage costs declining. As a result,
operating profit was up 10% to GBP4.7m (2012: GBP4.3m).
The outlook for the year ahead is positive with new business
secured for the first quarter of 2013/14, at our 500,000 sq. ft.
Heywood Hub, in the produce and chilled food consolidation centre
in Teynham Kent, and a two year extension of the distribution
contract with Mars. Additionally, there is a significant pipeline
of new business opportunities.
Spalding, our key distribution centre in the major growing
region of Lincolnshire, had a good year, with gross margins
improving on the back of focused cost control. Operating at near
capacity, the site continues to provide the highest standard of
warehousing and distribution services to key names such as Kerry
Foods, Bernard Matthews and Tulip.
A long term lease was entered into for the business's well
located Hilsea site, which is close to Portsmouth International
Port and the produce growing regions along the South Coast. The
lease covers the whole site which was previously shared with the
landlord and following recent investment in its facilities, Fowler
Welch is now able to offer a broader range of warehousing and
picking services as well as the traditional high quality
distribution
The Heywood Hub, ideally located in the Greater Manchester
region, is now fully established as a quality ambient storage and
distribution hub. This was underlined by our operational team being
awarded "Primary Carrier of the Year" by ASDA for the second
consecutive year. Fowler Welch is bringing its vast experience of
short distribution lead times from its chill and produce operations
to the ambient sector. New business wins with a number of clients
and a pipeline of future opportunities will see the site's
performance move forward in the coming year.
The Kent operations in Teynham and Paddock Wood sit in the heart
of that county's growing areas and are also able to provide a
distribution service for produce imported across the Channel. Loss
of the Garcia contract has been largely mitigated as volumes with
two of our other large customers have grown. A pipeline of other
opportunities gives us optimism for growth in the coming year.
Synergistic growth within the existing capacity of Fowler Welch,
coupled with the benefits of improved cost control will generate
improved gross and net margins in the year ahead.
Gary Brown
Group Chief Financial Officer
18 July 2013
www.dartgroup.co.uk
Enquiries:
Dart Group PLC
Philip Meeson, Chairman Mobile: 07785 258666
Gary Grown, Group CFO Tel: 0113 238 7444
Mobile: 07739 208969
Smith & Williamson Corporate Finance Limited
Andy Pedrette / Siobhan Sergeant Tel: 020 7131 4000
Canaccord Genuity
Peter Stewart / Mark Whitmore Tel: 020 7523 8000
For further media enquiries:
Contact the Press Office on 0113 243 1355 or email
pressoffice@jet2.com
Consolidated group income statement
for the year ended 31 March 2013
Unaudited Audited
results for results for
the year the year
ended ended
31 March 31 March
2013 2012
Continuing operations GBPm GBPm
Turnover 869.2 683.0
Net operating expenses (831.3) (654.5)
---------------- ----------------
Operating profit 37.9 28.5
Finance income 3.6 1.4
Finance costs (1.0) (1.8)
---------------- ----------------
Net financing costs 2.6 (0.4)
Profit before taxation 40.5 28.1
Taxation (9.3) (5.4)
---------------- ----------------
Profit for the year
(all attributable to equity
shareholders of the parent) 31.2 22.7
================ ================
Earnings per share
---------------- ----------------
* basic 21.73 p 16.01p
* diluted 21.44 p 15.48p
---------------- ----------------
Consolidated group statement of comprehensive income
for the year ended 31 March 2013
Year ended Year ended
31 March 31 March
2013 Unaudited 2012 Audited
GBPm GBPm
Profit for the year 31.2 22.7
Effective portion of fair value movements
in cash flow hedges (3.4) (14.3)
Net change in fair value of effective -
cash flow hedges transferred to profit -
Taxation on components of other comprehensive
income 0.7 3.8
---------------- ----------------
Other comprehensive income and expense
for the period, net of taxation (2.7) (10.5)
Total comprehensive income for the
period all attributable to owners of
the parent 28.5 12.2
================ ================
Consolidated balance sheet
at 31 March 2013
Unaudited Audited
2013 2012
GBPm GBPm
Non-current assets
Goodwill 6.8 6.8
Property, plant and equipment 269.1 234.9
Derivative financial instruments 1.0 3.6
276.9 245.3
----------- ----------
Current assets
Inventories 1.3 1.4
Trade and other receivables (due over
1 yr GBP6.6m (2012: GBP6.6m)) 226.2 117.4
Derivative financial instruments 22.2 25.8
Money market deposits 30.0 77.0
Cash and cash equivalents 190.9 75.0
----------- ----------
470.6 296.6
----------- ----------
Total assets 747.5 541.9
----------- ----------
Current liabilities
Trade and other payables 92.0 61.2
Deferred revenue 407.1 256.8
Borrowings 0.8 0.8
Provisions 2.1 1.7
Derivative financial instruments 4.2 7.8
----------- ----------
506.2 328.3
----------- ----------
Non-current liabilities
Other non-current liabilities 11.4 11.9
Borrowings 7.7 8.5
Derivative financial instruments 0.3 1.4
Deferred tax liabilities 35.3 32.9
----------- ----------
54.7 54.7
Total liabilities 560.9 383.0
Net assets 186.6 158.9
=========== ==========
Shareholders' equity
Share capital 1.8 1.8
Share premium 10.7 9.8
Cash flow hedging reserve 12.4 15.1
Retained earnings 161.7 132.2
Total shareholders' equity 186.6 158.9
=========== ==========
consolidated group cash flow statement
for the year ended 31 March 2013
Unaudited Audited
2013 2012
GBPm GBPm
Cash flows from operating activities
Profit on ordinary activities before
taxation 40.5 28.1
Adjustments for:
Finance income (3.6) (1.4)
Finance costs 1.0 1.8
Depreciation 45.5 34.4
Equity settled share based payments 0.4 0.4
Operating cash flows before movements
in working capital 83.8 63.3
Decrease / (increase) in inventories 0.1 (0.6)
Increase in trade and other receivables (108.5) (43.3)
Increase in trade and other payables 29.2 2.7
Increase in deferred revenue 150.3 79.7
Increase / (decrease) in provisions 0.4 (2.2)
Cash generated from operations 155.3 99.6
Interest received 1.4 0.5
Interest paid (1.1) (1.8)
Income taxes paid (5.3) (3.8)
Net cash from operating activities 150.3 94.5
---------- --------
Cash flows used in investing activities
Purchase of property, plant and equipment (79.7) (47.3)
Proceeds from sale of property, plant
and equipment - 0.3
Net decrease / (increase) in money
market deposits 47.0 (68.5)
Net cash used in investing activities (32.7) (115.5)
---------- --------
Cash flows from financing activities
Repayment of borrowings (0.8) (1.9)
New loans advanced - 0.6
Proceeds on issue of shares 0.9 0.2
Equity dividends paid (2.1) (1.8)
Net cash used in financing activities (2.0) (2.9)
---------- --------
Effect of foreign exchange rate changes 0.3 0.6
Net increase / (decrease) in cash
in the year 115.9 (23.3)
Cash and cash equivalents at beginning
of year 75.0 98.3
Cash and cash equivalents at end
of year 190.9 75.0
========== ========
Consolidated group statement of changes in equity
(UNAUDITED)
for the year ended 31 March 2013
Share Share Cash flow Retained Total
Capital premium hedging earnings reserves
reserve
GBPm GBPm GBPm GBPm GBPm
--------- --------- ---------- ---------- ----------
Balance at 1 April
2011 1.8 9.6 25.6 110.9 147.9
Total comprehensive
income for the year - - (10.5) 22.7 12.2
Issue of share capital - 0.2 - - 0.2
Dividends paid in
the year - - - (1.8) (1.8)
Share based payments - - - 0.4 0.4
Balance at 31 March
2012 1.8 9.8 15.1 132.2 158.9
Total comprehensive
income for the year - - (2.7) 31.2 28.5
Issue of share capital - 0.9 - - 0.9
Dividends paid in
the year - - - (2.1) (2.1)
Share based payments - - - 0.4 0.4
Balance at 31 March
2013 1.8 10.7 12.4 161.7 186.6
========= ========= ========== ========== ==========
Notes to the consolidated financial statements
for the year ended 31 March 2013
1. General information
The Group's Financial Statements consolidate the Financial
Statements of Dart Group PLC and its subsidiaries. The Group's
Financial Statements have been prepared and approved by the
Directors in accordance with International Financial Reporting
Standards ('IFRSs') as adopted by the European Union ('Adopted
IFRSs').
2. Basis of preparation
The financial statements have been prepared under the historical
cost convention except for all derivative financial instruments
that have been measured at fair value.
Whilst the financial information included in this preliminary
announcement has been computed in accordance with IFRS as adopted
by the European Union, this announcement does not itself contain
sufficient information to comply with IFRS. The Company expects to
publish full financial statements in August 2013.
The Group uses forward foreign currency contracts, currency
option products and aviation fuel swaps to hedge exposure to
foreign exchange rates and aviation fuel price volatility. The
Group also uses forward EU Allowance contracts and forward
Certified Emissions Reduction contracts to hedge exposure to Carbon
Emissions Allowance volatility following the need for the Group to
join the EU Emissions Trading Scheme from 1 January 2012. Such
derivative financial instruments are stated at fair value.
Going concern
The Directors have prepared financial forecasts for the Group,
comprising operating profit, balance sheet and cash flows through
to 31 March 2016.
Since the reporting date the Group completed the refinancing of
its bank facilities with a number of funding lines committed until
the end of August 2017. The Group's facility is subject to security
from the lending counterparties and is subject to standard
financial and non-financial covenants.
For the purposes of their assessment of the appropriateness of
the preparation of the Group's accounts on a going concern basis,
the Directors have considered the current cash position, the
availability of bank facilities, the Group's net current liability
position, which is driven principally by continued deferred revenue
growth, and forecasts of future trading. The Directors have
assessed the current level of forward bookings for the Leisure
Airline and Package Holidays businesses, the underlying assumptions
and principal areas of uncertainty within future forecasts, in
particular those related to market and customer risks which impact
on future bookings, cost management, working capital management and
treasury risks. A number of these are subject to market uncertainty
and impact financial covenants. Recognising the potential
uncertainty, the Directors have considered a range of actions
available to mitigate the impact of these potential risks, should
they crystallise, and have also reviewed the key strategies which
underpin the forecast and the Group's ability to implement them
successfully.
On the basis of the current liquidity position, the current
Leisure Airline and Package Holidays forward booking profile, the
forecasts and the considerations outlined above, the Directors have
assessed future covenant compliance and headroom for the
foreseeable future and concluded that it is appropriate for the
financial statements for the year ended 31 March 2013 to be
prepared on a going concern basis.
3. Earnings per share
Unaudited Audited
2013 2012
No. No.
Basic weighted average number of shares
in issue 143,618,691 142,129,972
Dilutive potential ordinary shares: employee
share options 1,926,331 4,872,314
Diluted weighted average number of shares
in issue 145,545,022 147,002,286
============ ============
Basis of calculation - earnings (basic GBPm GBPm
and diluted)
Profit for the purposes of calculating
basic and diluted earnings 31.2 22.7
Unaudited Audited
year to year to
31 March 31 March
Earnings per share - Total 2013 2012
- basic 21.73p 16.01p
- diluted 21.44p 15.48p
4. Segmental reporting
Business segments
The Chief Operating Decision Maker ("CODM") is responsible for
the overall resource allocation and performance assessment of the
Group. The Board approves major capital expenditure, assesses the
performance of the Group and also determines key financing
decisions. As such, the Group considers that the Board is the
CODM.
The Group's operating segments have been identified based on the
internal reporting information provided to the CODM in order for
the CODM to formulate allocation of resources to segments and
assess their performance. From such information, the Leisure
Airline, Package Holidays and Distribution & Logistics
businesses have been determined to represent operating
segments.
The Leisure Airline and Package Holidays businesses are run on
the basis of the evaluation of route revenue, yield and margin
data. However, resource allocation decisions are made based on the
entire route network and, in the case of Leisure Airline, the
deployment of the entire aircraft fleet. The objective in making
resource allocation decisions is to maximise the segment results
rather than individual routes within the network.
The Distribution & Logistics business is run on the basis of
the evaluation of distribution centre-level performance data.
However, resource allocation decisions are made based on the entire
distribution network. The objective in making resource allocation
decisions is to maximise the segment results rather than individual
distribution centres within the network.
Following the identification of the operating segments, the
Group has assessed the similarity of the characteristics of the
operating segments. Given the different performance targets,
customer bases and operating markets of each of the operating
segments it is not appropriate to aggregate the operating segments
for reporting purposes and therefore all three of the identified
operating segments are disclosed as reportable segments:
-- Leisure Airline, comprising the Group's scheduled leisure airline, Jet2.com;
-- Package Holidays, comprising the Group's ATOL protected tour operator, Jet2holidays; and
-- Distribution & Logistics, comprising the Group's logistics company, Fowler Welch.
The Board assesses the performance of each segment based on
profit, before and after tax, and EBITDA. Revenue from reportable
segments is measured on a basis consistent with the income
statement. Revenue is principally generated from within the UK, the
Group's country of domicile.
Segment results, assets and liabilities include items directly
attributable to a segment, as well as those that can be allocated
on a reasonable basis. No customer represents more than ten percent
of the Group's revenue.
Distribution Leisure Package Group Total
& Logistics Airline Holidays Eliminations
GBPm GBPm GBPm GBPm GBPm
Year ended 31 March 2013
Turnover 155.2 556.2 244.8 - 956.2
Inter-segment turnover - - - (87.0) (87.0)
--------- ----------- ---------- ---------------- ---------------
Turnover 155.2 556.2 244.8 (87.0) 869.2
EBITDA 6.8 69.8 6.8 - 83.4
Operating profit 4.7 26.7 6.5 - 37.9
Finance income - 3.3 0.3 - 3.6
Finance costs (0.3) (0.7) - - (1.0)
Profit before taxation 4.4 29.3 6.8 - 40.5
Taxation (1.4) (6.2) (1.7) - (9.3)
--------- ----------- ---------- ---------------- ---------------
Profit after taxation 3.0 23.1 5.1 - 31.2
========= =========== ========== ================ ===============
Assets and liabilities
Segment assets 72.9 535.5 527.4 (388.3) 747.5
Segment liabilities (37.6) (394.3) (517.3) 388.3 (560.9)
--------- ----------- ---------- ----------------
Net assets 35.3 141.2 10.1 - 186.6
========= =========== ========== ================ ===============
Other segment information
Property, plant
and equipment additions 0.9 78.7 0.1 - 79.7
Depreciation, amortisation
and impairment (2.1) (43.1) (0.3) - (45.5)
Share based payments (0.1) (0.2) (0.1) - (0.4)
Distribution Leisure Package Group Total
& Logistics Airline Holidays Eliminations
GBPm GBPm GBPm GBPm GBPm
Year ended 31 March
2012
Turnover 152.4 461.3 114.5 - 728.2
Inter-segment turnover - - - (45.2) (45.2)
--------- ----------- ---------- ---------------- ---------------
Turnover 152.4 461.3 114.5 (45.2) 683.0
EBITDA 6.4 53.7 2.8 - 62.9
Operating profit 4.3 21.7 2.5 - 28.5
Finance income - 1.4 - - 1.4
Finance costs (0.4) (1.4) - - (1.8)
Profit before taxation 3.9 21.7 2.5 - 28.1
Taxation (1.1) (3.6) (0.7) - (5.4)
--------- ----------- ---------- ---------------- ---------------
Profit after taxation 2.8 18.1 1.8 - 22.7
========= =========== ========== ================ ===============
Assets and liabilities
Segment assets 71.5 443.2 227.3 (200.1) 541.9
Segment liabilities (39.2) (321.6) (222.3) 200.1 (383.0)
--------- ----------- ---------- ----------------
Net assets 32.3 121.6 5.0 - 158.9
========= =========== ========== ================ ===============
Other segment information
Property, plant
and equipment additions 6.2 40.8 0.3 - 47.3
Depreciation, amortisation
and impairment (2.1) (32.0) (0.3) - (34.4)
Share based payments (0.1) (0.3) - - (0.4)
5. Financial information
The financial information set out above does not constitute the
company's statutory accounts for the years ended 31 March 2013 or
31 March 2012. The financial information for 2012 is derived from
the statutory accounts for the year ended 31 March 2012 which have
been delivered to the registrar of companies. The auditor has
reported on the year ended 31 March 2012 accounts; their report
was
i. unqualified;
ii. did not include a reference to any matters to which the
auditor drew attention by way of emphasis without qualifying their
report; and
iii. did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
The statutory accounts for the year ended 31 March 2013 will be
finalised on the basis of the financial information presented by
the directors in this preliminary announcement and will be
delivered to the registrar of companies in due course.
6. Annual report and accounts
The 2013 Annual Report and Accounts (together with the Auditor's
Report) will be posted to shareholders no later than 9 August 2013.
The Annual General Meeting will be held on 5 September 2013.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR DMGMNRNKGFZM
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