TIDMRGD
RNS Number : 0202R
Real Good Food PLC
06 December 2016
Strictly embargoed until: 07.00 on 6(th) December 2016
Real Good Food plc
("the Group" or "Real Good Food")
Interim results for the six months ending 30 September 2016
Real Good Food plc (AIM: RGD) today announces interim results
for the six months ending 30 September 2016. Real Good Food plc is
a diversified food business serving a number of market sectors
including retail, manufacturing, wholesale, foodservice and export.
The Group focuses on three main markets: Cake Decoration (Renshaw,
Rainbow Dust Colours), Food Ingredients (Garrett Ingredients and
R&W Scott) and Premium Bakery (Haydens and Chantilly
Patisserie). The Company makes the majority of is profits in the
second half of the year which includes the important Q3 trading
period for Cake Decoration and Premium Bakery in particular in the
run up to Christmas.
Interim Highlights
-- Total Group sales grew by 5% to GBP49.0 million (2015:
GBP46.7 million) driven primarily by the performance of the Premium
Bakery division, alongside the successful integration of Chantilly
to the Group
-- Gross profit increased to GBP13.0 million (2015: GBP12.5
million), but impacted adversely by performance of Food Ingredients
which struggled with volatile commodity pricing and adverse
currency movements
-- Total Group EBITDA (prior to significant items(1) ) down by
GBP0.8 million from the previous year at GBP1.2 million (2015:
GBP2.0 million) - due to increased expensed investment costs across
the Group, primarily in the Development Centre and in the USA,
which will drive future growth and operating efficiencies; also
impacted by the performance of the Food Ingredients division, which
suffered volatile commodity pricings.
-- Group loss before tax of GBP0.2 million (prior to significant
items(1) ) of GBP0.7m (2015: GBP0.2 million)
-- Substantial increase in actuarial losses of pension scheme of GBP3.3 million over six months
-- Proposed payment of first ever dividend in December 2016 with
an interim payment of 0.04 pence per share
-- Key Q3 trading period in line with expectations to date.
(1) - Significant items relate to management and restructuring
costs of GBP0.3 million and acquisition related costs of
GBP0.4m
Pieter Totté, Executive Chairman commented:
"We have continued to make good progress on developing our
growth strategies in each business division. With the exception of
Garrett Ingredients where the dairy and sugar markets have
continued to be difficult, exacerbated by recent currency
fluctuations, trading performance has been broadly in line with the
Board's expectations.
"Our new Development Centre at Liverpool is beginning to pay
dividends following a number of high profile customer visits and
the opening of our own sales and warehousing operation in the US
will enable significant sales growth from early 2017. At the same
time we are finalising other investment plans at our sites in
Liverpool and Devizes to improve our operational efficiency over
the medium term."
Commenting on outlook and current trading he added:
"Sales trends for the key third quarter are in line with
expectations to date and we anticipate significant year on year
growth in EBITDA in the second half. However, we face some
challenges due to the recent weakening of sterling and increased
raw material prices and the timing of price recovery. This, as well
as the uncertainty in commodity pricing in particular at Garrett
Ingredients, means that, while we expect our year end EBITDA to be
ahead of last year, there is a risk that it could fall short of
current market estimates."
*-ends-*
ENQUIRIES:
Real Good Food plc Tel: 020 3857 3900
Pieter Totté, Executive
Chairman
David Newman, Finance Director
Andrew Brown, Marketing Director
finnCap Limited (Nomad and Tel: 020 7220 0500
Joint Broker)
Matt Goode / Grant Bergman
(Corporate Finance)
Tim Redfern (Corporate Broking)
Daniel Stewart and Company Tel: 020 7776 6550
Plc (Joint Broker)
David Lawman
Jonathon Webb
Belvedere Communications Tel: 020 3567 0510
(PR)
John West
Kim van Beeck
REAL GOOD FOOD PLC
INTERIM RESULTS FOR THE SIX MONTHSING 30 SEPTEMBER 2016
Overview
We have continued to make good progress on developing our growth
strategies in each business division. With the exception of Garrett
Ingredients, where the dairy and sugar markets have continued to be
difficult, exacerbated by recent currency fluctuations, trading
performance has been broadly in line with the Board's
expectations.
Our new Development Centre at Liverpool is beginning to pay
dividends following a number of high profile customer visits and
the opening of our own sales and warehousing operation in the US
will enable significant sales growth from early 2017. At the same
time we are finalising other investment plans at our sites in
Liverpool and Devizes to improve our operational efficiency over
the medium term.
Divisional Business Reviews
Cake Decoration
Renshaw and Rainbow Dust Colours manufacture and sell cake
decoration products and ingredients for the baking sector across
the UK and abroad. Renshaw Europe and Renshaw Americas sell these
products in their respective territories.
GBP'000s Six months ending 30 September 2016
Revenue 21,039
EBITDA 3,145
While the market was not as buoyant during the summer as in
recent years, sales trends improved towards the autumn particularly
with the return of the Great British Bake-Off. The first half saw
significant investment in the product ranges with the re-launch of
the UK Renshaw Professional range and a new product, Renshaw Extra,
targeted at the European market. Rainbow Dust Colours also
re-launched its market leading edible colouring, Progel, for the
European market.
Significant investment was made in opening a new warehouse in
Rockaway, New Jersey, as the base for the new Renshaw Americas
business.
Food Ingredients
Garrett Ingredients supplies a range of food ingredients
including bagged sugars and dairy ingredients to food
manufacturers. R&W Scott manufactures and supplies chocolate
coatings, jams, fruit fillings and sauces to food manufacturers,
wholesalers and retailers.
GBP'000s Six months ending 30 September 2016
Revenue 12,347
EBITDA (477)
Difficult conditions continued in both of Garrett's main
commodity markets and this was followed by short term difficulties
caused by the weakening of sterling in September. Sugar supplies
have become critically short which will constrain volumes, though
markedly higher prices should improve margins. The dairy market has
also seen upward price movement and it is likely to be six months
before matters stabilise. The price rises in both these markets
will, in due course, present Garrett's with a number of
opportunities, through its sourcing expertise. R&W Scott has
performed solidly, increasing its delivered margin over last year
while operationally it performed well.
Premium Bakery
Haydens and Chantilly Patisserie manufacture, sell and
distribute added value bakery and dessert products to UK retailers
and foodservice customers
GBP'000s Six months ending 30 September 2016
Revenue 15,568
EBITDA 571
Sales have performed well with Haydens strongly ahead of last
year with good sales through Waitrose and new business gained at
Marks and Spencer. Growth at Chantilly has been constrained by the
delay in moving to new premises which is now timed for early 2017.
While the outlook on sales remains positive, EBITDA will be more
challenging in the second half as recent significant raw material
inflation (butter and cream prices have doubled recently as a
result of a sudden drop in milk production across the EU and the
effect in the UK has been exacerbated by the weakness of sterling)
is unlikely to be fully offset by price recovery until the New
Year.
Financial Review
Total Group sales grew by 5% to GBP49.0 million (2015: GBP46.7
million) driven primarily by the performance of the Premium Bakery
division, alongside the successful integration of Chantilly to the
Group. Gross profit increased to GBP13.0 million (2015: GBP12.5
million), again aided by the addition of Chantilly to the Group but
impacted adversely by performance of Food Ingredients as detailed
above.
Total Group Administrative Expenses increased by GBP1.4 million
to GBP10.2 million (2015: GBP8.8 million) as a result of the
increased investment across the Group, including the Food
Development Centre and the acquisition of Chantilly. Total Group
EBITDA was therefore down by GBP0.8 million from the previous year
at GBP1.2 million following the increased investment costs across
the Group detailed above and the performance of the Food
Ingredients division.
After depreciation and amortisation charges of GBP1.1 million,
the Group reported an operating profit prior to significant items
of GBP0.7m (comprising management and restructuring costs of GBP0.3
million and acquisition related costs of GBP0.4m) of GBP0.046
million (2015: GBP1.1 million). The Group loss before tax prior to
significant items of GBP0.7m (comprising management and
restructuring costs of GBP0.3 million and acquisition related costs
of GBP0.4m) was GBP0.2 million (2015: GBP0.2 million), and reported
Group loss before tax was GBP0.9 million (2015: GBP0.2
million).
Since the previous year end the Group successfully negotiated
extended borrowing facilities with Lloyds Bank plc to enable it to
continue its acquisition and investment strategy.
Dividend
Although our primary objective is to invest our cash to drive
growth in our operations, the Board feels that it is important to
start to pursue a progressive dividend policy alongside this.
In this regard, I am pleased to announce that the Board has
decided to commence the payment of dividends with an interim
dividend for this year of 0.04 pence per share. It is expected this
will be paid on 25 January 2017 to those shareholders on the
register as at 30 December 2016. The ex-dividend date is therefore
29 December 2016.
Pension Scheme
In common with most UK pension schemes the continuing reduction
in Government and corporate bond rates has had a disproportionate
effect on the NBF Pension deficit, resulting in an increase in
actuarial losses of GBP3.3 million over six months. Brexit and the
subsequent policy of quantitative easing are major contributors to
this. However, it is worth investors noting that a 1% increase in
bond rates would reduce the actuarial losses by some GBP5 million,
so over the life of the scheme such a short term 'hit' has to be
seen in context.
The Board is actively involved in the scheme's liability
management and is currently working with the Trustees and the
actuaries on an Enhanced Transfer Value offer to deferred
pensioners, the results of which should be known by March 2017.
Outlook and Current Trading
Sales trends for the key third quarter are in line with
expectations to date and we anticipate significant year on year
growth in EBITDA in the second half. However, we face some
challenges due to the recent weakening of sterling and increased
raw material prices and the timing of price recovery. This, as well
as the uncertainty in commodity pricing in particular at Garrett
Ingredients, means that, while we expect our year end EBITDA to be
ahead of last year, there is a risk that it could fall short of
current market estimates.
I am also pleased to announce that we will pay our first interim
dividend as start of a progressive policy as our business
grows.
Pieter Totté
Executive Chairman
REAL GOOD FOOD PLC
INDEPENT REVIEW REPORT TO REAL GOOD FOOD PLC FOR THE
SIX MONTHS TO 30 SEPTEMBER 2016
-- Introduction
We have been engaged by the company to review the condensed set
of financial statements in the six monthly interim financial report
for the six months ended 30 September 2016, which comprises the
consolidated statement of comprehensive income, consolidated
statement of financial position, consolidated statement of changes
in equity, consolidated statement of cashflows and the related
notes. We have read the other information contained in the six
monthly interim financial report and considered whether it contains
any apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
This report is made solely to the company, as a body, in
accordance with our instructions. Our review has been undertaken so
that we might state to the company those matters we are required to
state to them in a review report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company, for our work, for
this report, or for the conclusions we have formed.
-- Directors' Responsibilities
The six monthly interim financial report is the responsibility
of, and has been approved by, the directors.
As disclosed in note 2, the annual financial statements of the
group are prepared in accordance with IFRSs as adopted by the
European Union. The condensed set of financial statements included
in this six monthly financial report has been prepared in
accordance with International Accounting Standard 34, "Interim
Financial Reporting," as adopted by the European Union.
-- Our Responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the six monthly
interim financial report based on our review.
-- Scope of Review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity issued by the Auditing Practices Board for use in the
United Kingdom. A review of interim financial information consists
of making enquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing
(UK and Ireland) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not
express an audit opinion.
-- Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the six monthly interim financial report for the six months
ended 30 September 2016 is not prepared, in all material respects,
in accordance with International Accounting Standard 34 as adopted
by the European Union.
Crowe Clark Whitehill LLP
Chartered Accountants
10 Palace Avenue
Maidstone
Kent ME15 6NF
REAL GOOD FOOD PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX
MONTHSING 30 SEPTEMBER 2016
(UNAUDITED)
Notes
30.09.2016 30.09.2015
GBP'000s GBP'000s
CONTINUING OPERATIONS
Revenue 48,954 46,656
Cost of sales (35,878) (34,158)
----------- -----------
Gross profit 13,076 12,498
Distribution
costs (2,796) (2,611)
Administration
expenses (10,234) (8,804)
Significant costs 10 (694) -
Operating (loss)/profit (648) 1,083
Finance costs (193) (1,203)
Net pension finance
income (108) (96)
----------- -----------
Loss before taxation (949) (216)
Taxation 7 192
----------- -----------
Loss from continuing
operations (942) (24)
----------- -----------
Gain on Disposal
of Subsidiary - 9,425
Loss from Discontinued
business 9 - (84)
----------- -----------
(Loss)/Profit
for the period
attributable to
the equity holders
of the parent (942) 9,317
----------- -----------
Other comprehensive
income
Actuarial losses
on defined benefit
plans (3,307) 641
Income tax relating
to components
of other comprehensive
income 628 (128)
Total comprehensive
(loss)/income
for the period (3,621) 9,830
=========== ===========
Basic (loss)/profit
per share 4 (1.34)p 13.4p
Diluted (loss)/profit
per share 4 (1.34)p 12.3p
REAL GOOD FOOD PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 30 SEPTEMBER
2016
(UNAUDITED)
30 Sept 31 Mar 30 Sept
2016 2016 2015
GBP'000s GBP'000s GBP'000s
ASSETS
NON CURRENT ASSETS
Goodwill 71,005 71,005 70,019
Intangibles 1,088 834 661
Property, plant and
equipment 20,886 18,066 14,019
Deferred tax asset 2,324 1,556 1,725
--------- --------- ---------
95,303 91,461 86,424
--------- --------- ---------
CURRENT ASSETS
Inventory 14,749 12,360 14,690
Trade and other receivables 17,377 17,039 18,215
Current tax assets - - -
Cash and cash equivalents 1,460 2,946 4,344
33,586 32,345 37,249
--------- --------- ---------
Total Assets 128,889 123,806 123,673
--------- --------- ---------
LIABILITIES
CURRENT LIABILITIES
Bank Overdraft 196 949 -
Borrowings (Note 11) 14,015 7,008 7,361
Trade and other payables 12,301 13,243 17,314
Current tax liabilities 128 127 164
26,640 21,327 24,839
--------- --------- ---------
NON CURRENT LIABILITIES
Borrowings (note 11) 36 55 -
Deferred tax 2,055 1,925 2,019
Retirement benefit
obligations (note
9) 9,346 6,081 4,983
--------- --------- ---------
11,437 8,061 7,002
--------- --------- ---------
Net Assets 90,812 94,418 91,832
========= ========= =========
SHAREHOLDERS' EQUITY
Issued share capital 1,402 1,402 1,396
Share premium account 103 71,375 71,333
Share option reserve 607 592 595
Retained earnings 88,700 21,049 18,508
--------- --------- ---------
Total Equity 90,812 94,418 91,832
========= ========= =========
REAL GOOD FOOD PLC
STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHSING 30
SEPTEMBER 2016
(UNAUDITED)
Issued Share Share Total
Share Premium Option Retained
Capital Account reserve Earnings
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
Balance at 1 April
2015 1,392 71,272 577 8,678 81,919
Shares issued in
period 4 61 - - 65
Shares to be issued
(net of deferred
tax) - - 18 - 18
Total comprehensive
income for the period - - - 9,830 9,830
Balances as at 30
September 2015 1,396 71,333 595 18,508 91,832
========= ========= ========= =========== =========
Balance at 1 April
2016 1,402 71,375 592 21,049 94,418
Shares issued in - - -
the period - -
Shares to be issued
(net of deferred
tax) - - 15 - 15
Capital Reduction
Transfer - (71,272) - 71,272 -
Total comprehensive
income for the period - - - (3,621) (3,621)
Balances as at 30
September 2016 1,402 103 607 88,700 90,812
========= ========= ========= =========== =========
REAL GOOD FOOD PLC
STATEMENT OF CASH FLOWS FOR THE SIX MONTHSING 30 SEPTEMBER
2016
(UNAUDITED)
6 months 6 months
to to
30 Sept 30 Sept
2016 2015
GBP'000s GBP'000s
CASH FLOW FROM OPERATING ACTIVITIES
Loss for the period before
taxation (949) (216)
Adjusted for:
Finance costs 193 1,203
Other finance income 108 96
Depreciation of property,
plant & equipment 1,031 855
Amortisation of intangibles 108 180
Operating Cash Flow 491 2,118
(Increase)/Decrease in inventories (2,389) (4,509)
(Increase) in receivables (439) (4,752)
Pension contributions (150) (160)
(Decrease) in payables (826) (3,169)
---------- ----------
Cash outflow from operations (3,313) (10,472)
Income taxes (paid)/received - (449)
Interest paid (193) (1,480)
---------- ----------
Net cash outflow from operating
activities (3,506) (12.401)
---------- ----------
CASH FLOW FROM INVESTING
ACTIVITIES
Net Disposal Proceeds from
Napier Brown Sugar - 41,187
Purchase of intangible assets (362)
Purchase of property, plant
& equipment (3,851) (1,506)
---------- ----------
Net cash (used in)/from
investing activities (4,213) 39,661
---------- ----------
CASH FLOW FROM FINANCING
ACTIVITIES
Shares issued - 65
Repayment of loans - (8,295)
Net movements on revolving
credit facilities 6,962 (21,203)
Repayment of obligations
under finance leases 24 (119)
Net cash used in financing
activities 6,986 (29,552)
---------- ----------
NET DECREASE IN CASH AND
CASH EQUIVALENTS (733) (2,292)
========== ==========
CASH AND CASH EQUIVALENTS
Cash and cash equivalents
at beginning of period 1,997 6,636
Net movement in cash and
cash equivalents (733) (2,292)
---------- ----------
Cash and cash equivalents
at balance sheet date 1,264 4,344
========== ==========
Cash and cash equivalents
comprise:
Cash 1,460 4,344
Overdraft (196) -
1,264 4,344
========== ==========
REAL GOOD FOOD PLC
NOTES TO THE INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER
2016
1. General Information
Real Good Food Plc is a public limited company ("company")
incorporated in the United Kingdom under the Companies Act
(registration number 4666282). The company is domiciled in the
United Kingdom and its registered address is International House, 1
St Katharine's Way, London, E1W 1XB. The company's shares are
traded on the Alternative Investment Market ("AIM").
The principal activities of the group are the sourcing,
manufacture, marketing and distribution of food and industrial
ingredients.
The interim report will be posted on the company's website and
will be released via the Stock Exchange. Further copies of the
interim report and Annual Report and Accounts may be obtained from
the address above.
2. Basis of preparation
These condensed consolidated financial statements are presented
on the basis of International Financial Reporting Standards (IFRS)
as adopted by the European Union and interpretations issued by the
International Financial Reporting Interpretations Committee (IFRIC)
and have been prepared in accordance with AIM rules and the
Companies Act 2006, as applicable to companies reporting under
IFRS.
The same accounting policies and methods of computation are
followed within these interim financial statements as adopted in
the most recent annual financial statements
New IFRS standards and interpretations adopted
A number of new standards and amendments to standards and
interpretations have been issued but are not yet effective and in
some cases have not yet been adopted by the EU.
The Directors are still assessing whether the application of
IFRS 9, IFRS 15 and IFRS 16, once effective, will have a material
impact on the results of the group. Application of these standards
may result in changes in presentation of information within the
Group's financial statements.
REAL GOOD FOOD PLC
NOTES TO THE INTERIM RESULTS FOR THE SIX MONTHS TO SEPTEMBER
2016
3. Segment analysis
Business segments
The divisional structure reflects the management teams in place
and also ensures all aspects of trading activity have the specific
focus that they need in order to achieve our growth plans. As
explained in the March 2016 financial statements the business is
divided into three distinct pillars as detailed below.
The following table shows the Group's revenue and results for
the period under review analysed by operating segment. Segment
profit represents the trading profit after depreciation but before
significant items.
Premium
Cake Decoration Food Ingredients Bakery Total
GBP'000s GBP'000s GBP'000s GBP'000s
Total revenue 21,713 14,059 15,568 51,340
Revenue - internal (674) (1,712) - (2,386)
External revenue 21,039 12,347 15,568 48,954
Operating profit/(loss)
before Head Office 2,795 (684) 94 2,205
Head office and unallocated - - - (2,159)
Significant costs (172) (62) (90) (694)
Finance costs (net
of interest received) (53) - (37) (193)
Pension finance costs - - - (108)
Profit/(Loss) before
tax 2,570 (746) (33) (949)
Tax 114 (133) 47 28
Tax unallocated - - - (35)
(Loss)/Profit after
tax as per statement
of comprehensive
income 2,684 (613) 14 (942)
================== ================= ========== =========
Inter-segment sales are charged at prevailing market rates.
REAL GOOD FOOD PLC
NOTES TO THE INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER
2016
3. Segment reporting (continued)
As at 30 SEPTEMBER Cake Premium Food Total
2016 Decoration Bakery Ingredients Unallocated Group
GBP'000s GBP'000s GBP'000s GBP'000s GBP'000s
Segment assets 88,950 13,357 20,341 122,648
Unallocated assets
Property, plant
and equipment 3,264
Intangible assets 275
Deferred tax
assets 2,099
Trade and other
receivables 335
Cash at bank
and in hand 268
Total assets 88,950 13,357 20,341 128,889
============ ========= ============== =========
Segment liabilities (12,926) (6,277) (6,039) (25,242)
Unallocated liabilities
Trade and other
payables (473)
Current Tax 895*
Borrowings (3,200)
Pension Liability (9,346)
Deferred tax
liabilities (711)
Total liabilities (12,926) (6,277) (6,039) (38,077)
Net operating
assets 76,024 7,080 14,302 90,812
============ ========= ============== =========
Non-current asset
additions 1,526 828 1,419 440 4,213
Depreciation 350 376 200 105 1,031
Amortisation - 101 7 - 108
---------------------------- ------------ --------- -------------- ------------ ---------
-- Corporation tax asset in Head Office which nets off to become
a corporation tax liability for the group overall
REAL GOOD FOOD PLC
NOTES TO THE INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER
2016
3. Segment reporting (continued)
Business segments
Geographical Segments
The group earns revenue from countries outside the United
Kingdom, this amounts to 11.7% of the total revenue of the group,
but as no individual country is considered to be material,
segmental reporting of a geographical nature is not considered
necessary in accordance with the provisions of IFRS 8.
4. Earnings per ordinary share
Earnings per share is calculated on the basis of the profit for
the period after tax, divided by the weighted average number of
shares in issue for the six month period of 70,066,903 (2015
69,638,675).
Diluted profit per share is calculated by adjusting the weighted
average number of ordinary shares outstanding to assume conversion
of all potential dilutive ordinary shares. Potential dilutive
ordinary shares arise from share options and warrants. For these, a
calculation is performed to determine the number of shares that
could have been acquired at fair value (determined as the average
annual market share price of the company's shares) based on the
monetary value of the exercise price attached to outstanding share
options. Thus the dilutive weighted average number of shares
considers the number of shares that would have been issued assuming
the exercise of the share options.
An adjusted profit per share and a diluted adjusted profit per
share, which exclude significant items, has also been calculated as
in the opinion of the board this will allow shareholders to gain a
clearer understanding of the trading performance of the group.
Six months to 30 Six months to 30
September 2016 September 2015
Weighted Per Weighted
Average share Average Per share
Earnings No. amount Earnings No. of amount
GBP'000s of shares pence GBP'000s shares pence
(Loss)/Profit
attributable
to ordinary shareholders (942) 70,066,903 (1.34) 9,317 69,638,675 13.4
Significant items 694 - - (9,425) - -
Adjusted (loss)/profit
per share (248) 70,066,903 (0.35) (108) 69,638,675 (0.16)
Dilutive effect
of options - 5,416,227 - - 5,889,638 -
Diluted (loss)/profit
per share* (942) 75,483,130 (1.25) 9,317 75,528,313 12.3
Diluted adjusted
(loss)/profit per
share * (248) 75,483,130 (0.33) (108) 75,528,313 (0.14)
*As the group is loss making in the period under review the
diluted earnings per share is the same as basic earnings per
share
5. Dividends
The board are recommending an interim dividend of 0.04 pence per
share be paid in January 2017 for the six months ended 30 September
2016 (2015 Nil).
6. Taxation
The charge for taxation is based on the results for the period
and takes into account taxation deferred because of timing
differences between the treatment of certain items for taxation and
accounting purposes.
Provision is made in full for taxation deferred in respect of
timing differences that have originated but not reversed by the
balance sheet date, except for gains on disposal of fixed assets
which will be rolled over into replacement assets. No provision is
made for taxation on permanent differences. Deferred tax is not
discounted.
Deferred tax assets are recognised to the extent that it is more
likely than not that they will be recovered
REAL GOOD FOOD PLC
NOTES TO THE INTERIM RESULTS FOR THE SIX MONTHS TO 30 SEPTEMBER
2016
7. Pension arrangements
The Group operates a defined benefit pension scheme, the Napier
Brown Retirement Benefits Scheme. The assets of the scheme are held
separately from those of the Group in an independently administered
fund. The contributions made by the employer over the six-month
period have been GBP150,000.
Assumptions
The assets of the scheme have been included at market value and
the liabilities have been calculated using the following principal
actuarial assumptions:
30 September 31 March 30 September
2016 2016 2015
% per annum % per annum % per annum
-------------------------------- --------------- --------------- ---------------
Rate of increase in pensions
in payment 2.90 2.70 2.80
Discount rate 2.55 3.65 3.90
Inflation assumption 3.00 2.80 2.90
Revaluation rate for
deferred pensions 2.00 1.80 1.50
The fair value of the assets in the scheme and the present value
of the liabilities in the scheme are
30 September 31 March 30 September
2016 2016 2015
GBP'000s GBP'000s GBP'000's
------------------------------ --------------- ------------ ---------------
Total fair value of assets 15,527 15,013 15,184
Present value of scheme
liabilities (24,873) (21,094) (20,167)
--------------- ------------ ---------------
(Deficit) in the scheme (9,346) (6,081) (4,983)
The scheme is a closed scheme and therefore under the projected
unit method the current service cost would be expected to increase
as the members of the scheme approach retirement.
8. Seasonality
Most of the trading divisions of RGF are seasonal, creating a
large proportion of their EBITDA in the October to December
period.
9. Discontinued Business
As disclosed in the year ended March 2016 accounts the Group
disposed of its Napier Brown Sugar business on 19 May 2015. This
disposal was consistent with the Group's strategy for the sugar
business and allows it to focus on its remaining businesses. The
results of the disposed business is shown below:
6 months ended 6 months ended
30 September 30 September
2016 2015
Revenue - 13,237
Cost Of Sales - (11,884)
----------------- ---------------
Gross Margin - 1,353
Distribution - (1,149)
Administration - (288)
----------------- ---------------
Operating Loss - (84)
----------------- ---------------
10. Significant Items
During the period the group incurred a number of significant
items as detailed below. The restructuring costs incurred relate to
management changes ahead of changes planned in the business.
Acquisition costs relate to fees incurred in the period for
professional services relating to the investigation of suitable
acquisitions for the group in line with the search for bolt-on
acquisitions to enhance the group's performance:
6 months ended
30 September
2016
Management restructuring costs 324
Abortive acquisition costs 370
---------------
Total Significant items 694
---------------
11. Borrowings
Since the previous year end the Group successfully negotiated
extended borrowing facilities with Lloyds Bank plc to enable it to
continue its acquisition and investment strategy. The Group has
entered into an invoice finance facility of GBP20 million on a
revolving basis with a minimum term of 12 months and a 3 months'
notice period. This facility is secured against the debtors across
the whole of the Groups UK businesses, and comprise a Sterling,
Euro and US Dollar facility with an interest rate of 1.5% above
base rate.
In addition, in October 2016 a new term loan of GBP3 million was
agreed with Lloyds Bank plc to replace the loan taken out to
finance the acquisition of Rainbow Dust Colours Ltd. The new loan
has a term of 3 years expiring in October 2019 and is repayable in
quarterly instalments of GBP250k. Interest on this loan is charged
at 2.75% above base rate.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FSEFAIFMSEEE
(END) Dow Jones Newswires
December 06, 2016 02:00 ET (07:00 GMT)
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