RNS Number:5416I
Wyevale Garden Centres PLC
11 March 2003
For Immediate Release 11 March 2003
WYEVALE GARDEN CENTRES PLC
PRELIMINARY RESULTS FOR 52 WEEKS ENDED 29 DECEMBER 2002
* Adjusted diluted earnings per share up 15.3%
* Adjusted operating profit after interest up 14.1%
* Sales up 5.8%
* Dividend up 10%
Wyevale Garden Centres plc, the UK's leading garden centre operator, announces
preliminary results for the 52 weeks ended 29 December 2002.
KEY POINTS
* Profit before tax up 12.8% to #19.0m (2001: #16.9m); adjusted
operating profit after interest up 14.1% to #21.7m (2001: #19.0m);
* Sales up 5.8% to #176.4m (2001: #166.8m);
* Like for like sales up 2.2%;
* Gross margin increased by 0.6% to 47.4%, reflecting buying synergies
for the Group and continued improvement in margin at the former
Country Gardens centres;
* Concession and property income up 10.3% to #5.2m (2001: #4.7m);
* Adjusted operating profit up 8.0% to #28.8m (2001: #26.7m);
* Adjusted operating margin improved 0.3% to 16.3% reflecting tight
controls over gross margins and operating costs;
* Adjusted diluted earnings per share up 15.3% at 27.9p (2001: 24.2p);
* Proposed final dividend of 5.12p (2001: 4.65p) per Ordinary share
making 12.6p for the year (2001: 11.45p), up 10%;
* Cash generation before capital expenditure, acquisitions and
disposals was #18.4m. Net debt, was #134.4m representing gearing of
86%;
* New scanning and data capture systems now enable improved decision
making for the business;
* Commenting on outlook, Chief Executive, Bob Hewitt said:
"The past 12 months have again demonstrated that the business can adequately
cope with a difficult trading environment whilst successfully acquiring and
integrating three large garden centres. The experience gained by all those
involved will undoubtedly contribute to the future profitability of the
business."
* Chairman, Brian Evans, added:
"The future prospects for the garden centre industry as a whole remain positive
and we will continue to focus our efforts on further improving the profitability
of the business and shareholder returns."
For further information:
Brian Evans, Chairman
Robert Hewitt, Chief Executive
Stephen Murfin, Finance Director
Wyevale Garden Centres Tel: 020 7466 5000 (11 to 13 March inclusive);
01432 276568 (thereafter)
Richard Darby
Mark Edwards
Nicola Cronk
Buchanan Communications Tel: 020 7466 5000
Chairman's Statement
I am pleased to report that operating profit before charging amortisation of
goodwill (adjusted operating profit) increased by 8.0% to #28.8 million, with
adjusted operating profit after interest increasing by 14.1% to #21.7 million.
Group sales for the year at #176.4 million increased by 5.8% with like for like
sales increasing by 2.2%.
Concession income and property rental increased by 10.3% to #5.2 million.
Adjusted operating margin improved by 0.3% and at 16.3% reflects tight controls
over gross margins and operating costs.
Net debt at 29 December 2002 was #134.4 million on shareholders' funds of #155.7
million, representing gearing of 86%.
Earnings per Share
Adjusted diluted earnings per share increased by 15.3% to 27.9p.
Dividend
The Board is recommending a final dividend of 5.12p per Ordinary share, making
12.6p for the year, an increase of 10%.
The Board
During November Peter Williamson retired as Deputy Chairman. Peter and I have
worked closely on the development of the garden centre industry over the past 30
years. I should like to thank Peter for his contribution. We are pleased that
Peter has agreed to continue as a non-executive director.
I should also like to take the opportunity to commend my executive and
non-executive Board colleagues. The experience that they are able to bring to
bear and the efforts they sustain are all to the Company's great benefit.
Acquisitions and Redevelopments
As in previous years we successfully expanded our portfolio with the acquisition
of two operating garden centres and the opening of a substantial new garden
centre. On 30 April 2002 we acquired Auldene Holdings Limited. Auldene is a long
established garden centre with an excellent reputation for its product range,
expertise and customer service and is located in a good catchment area near
Leyland, Lancashire, with the potential for continued growth.
In May we acquired the leasehold interest in a 10 acre former caravan show site
at Crowland situated between Peterborough and Spalding. The 66,000 sq ft
facility is our largest to date and was completely refurbished to encompass a
number of new design concepts. The centre opened for trading on 26 October 2002.
Also on 26 October 2002 we acquired Woodlands Nurseries, one of the UK's largest
garden centres, situated on the A447 between Hinckley and Coalville in
Leicestershire. This is a 16.75 acre freehold site trading from 65,000 sq ft of
retail space.
We are confident that these acquisitions will all contribute to the Company's
continued profitability.
In addition to acquisitions, we are keen to exploit the potential within our
existing portfolio. Our aim is to create the maximum number of large scale
destination centres. To this end, we have carried out a number of extensions and
refurbishments and obtained planning permission for redevelopment at further
centres.
At the end of the year we traded from 124 garden centres of which 81 are
freehold and 43 are leasehold.
Outlook
We remain confident that our proven strategy will exploit the long term growth
potential of the business.
The future prospects for the garden centre industry as a whole remain positive
and we will continue to focus our efforts on further improving the profitability
of the business and shareholder returns.
Finally, I would like to thank all employees for their hard work and commitment,
and for their considerable contribution to the success of the Group.
Brian Evans
Chairman
Chief Executive Review
Despite difficult trading conditions during the important gardening months of
May and June, I am pleased to report another year of improved sales and profit
performance, with Group sales ahead by 5.8% and an increase in adjusted
operating profit after interest of 14.1%. During the year we made three
significant acquisitions and continued our programme of redevelopment and
refurbishment with major works being undertaken at three centres.
Trading Review
The trading year was one of mixed fortunes. The Spring season started well and
record sales were achieved particularly in March and April when good gardening
conditions prevailed. Like for like sales for the 17 weeks to 28 April increased
by 23.9%. However, disappointing weather and the loss of the Spring Bank Holiday
weekend affected like for like sales in May, down by 21.6%. Despite these
factors, like for like sales for the 21 weeks to 26 May were up by 6.5%.
Difficult trading conditions in June continued with cold, wet weather in the
early part of the month affecting the sales of garden plants, furniture and
barbecues. Additionally, the combined effects of the Jubilee celebrations and
the World Cup taking place over the delayed Bank Holiday weekend resulted in a
shortfall in sales of #5 million over the 14 day period, compared with the May
Bank Holiday period in 2001. The wide variance in trading conditions resulted in
a like for like first half sales increase of 1.7%. During this period stock
levels were well controlled, sales were maximised when customer demand was at
its highest and wastage levels were minimised in the latter part of the main
gardening season.
Despite a disappointing start to the month of July, improved weather in August
and September resulted in a like for like sales increase of 5.7% in the third
quarter, whilst trade in the month of September was particularly strong as a
direct result of good gardening conditions, we were unable to sustain this
performance over the Christmas period. Although we achieved an increase in like
for like sales of 5.7% in October, trading in the months of November and
December was disappointing with like for like sales down by 1.6% and up by only
0.1% respectively. Fourth quarter like for like sales increased by 1.1% with a
resultant like for like increase of 2.2% for the full year.
I am pleased to report that gross margins for the Group increased by 0.6% to
47.4%, reflecting buying synergies for the Group and the continued improvement
in margin at the former Country Gardens centres. These sites are now operating
in line with those of Wyevale.
During the year we continued to source quality concessions which complement our
own retail format. Building on the significant growth in concession and property
income in recent years, further growth of 10.3% was achieved during 2002 with a
total income of #5.2 million.
Buying
Our aim is to continue to offer customers a wide range of quality products at
competitive prices. Capitalising on the experience gained with the acquisition
of the two Fosters Garden Centres in 2001, we introduced a new Christmas concept
to six centres, entailing a wider range of product, improved merchandising and
new marketing initiatives.
The success of the trial has resulted in the planned introduction of this
concept at a number of additional centres in 2003.
Our new scanning and data capture systems now enable improved decision-making
for the business. This will bring significant benefits in terms of better stock
control, reduced levels of discounting and wastage, particularly in respect of
living product, and ultimately improved margins. We can now analyse in detail
the sales per square foot achieved from a wide product range and achieve
improved space utilisation, particularly in our small to medium-sized garden
centres.
Acquisition and Development
In April we acquired Auldene, a garden centre located on the A581 at Ulnes
Walton, south of Leyland in Lancashire. This 3.5 acre freehold site has total
covered retail space of 35,000 sq ft. Also in April we acquired the leasehold of
a former caravan show site which is prominently located on the A1073 at Crowland
in Cambridgeshire. After extensive refurbishment the garden centre was opened
for trading on 26 October 2002. This has been one of the most exciting single
acquisitions to date as its sheer size at 66,000 sq ft provided us with the
opportunity to explore new design concepts, fixtures and fittings.
The additional space has enabled us to increase our product range over and above
that of a large garden centre. It has also facilitated the installation of a
large modern 350-seat restaurant operation and a number of quality concessions.
I believe that we have created one of the best garden centres in the country
which is distinctive, comfortable and inspiring.
In October we acquired Woodlands Nurseries in Leicestershire, a garden centre we
have long admired as one of the largest and best garden centres in the country.
It has an excellent reputation for customer service, product range and the
quality of its plants, particularly bedding plants which are grown on site. The
success of Woodlands was rewarded in January 2003 with the award of 'Garden
Centre of the Year' as judged and presented by the Garden Centre Association. I
would like to congratulate all management and staff at the centre for their hard
work and dedication.
Prior to the Spring we completed phase one of a complete rebuild of our garden
centre in Northampton. Phase two commenced in the Autumn with final completion
scheduled for Spring 2003. The new facility will have an internal covered retail
area of 48,000 sq ft, doubling the size of the original. Following on from
Crowland the centre will have a number of new improved design and layout
concepts, and on completion will be one of our flagship stores.
In September we commenced phase two of a similar rebuild of our garden centre at
Hare Hatch near Reading. The new centre will have 30,000 sq ft of covered retail
space. In the Autumn we also commenced a redevelopment at Dorking in Surrey
where a partial rebuild is now in progress. The improved centre will encompass a
new car parking facility and planteria. Dorking and Hare Hatch will be completed
in time for Spring trading 2003.
During the year we also completed the internal refurbishment of nine centres,
six of these being former Country Gardens centres. 29 of the 39 Country Gardens
centres have now been internally refurbished to the Wyevale format.
As part of our core strategy we have upgraded the restaurant facilities at four
centres where the operation had previously been operated by franchisees. In
addition, new planterias were installed at a further four sites.
Outlook
Our well proven trading formula and strategy of acquisition and redevelopment
will continue. Currently we have planning permission granted for the
redevelopment of a further 13 sites and there remains significant potential at a
number of our other sites. This is a great advantage in that it enables us to
combine the redevelopment of our existing centres with the acquisition of new
sites.
The past 12 months have again demonstrated that the business can adequately cope
with a difficult trading environment whilst successfully acquiring and
integrating three large garden centres. The experience gained by all those
involved will undoubtedly contribute to the future profitability of the
business.
Robert Hewitt
Chief Executive
Finance Director's Report
Review of Results
Sales growth of 5.8% for the 52 weeks ended 29 December 2002 generated profit
growth before interest of 8.0% demonstrating good control over operational
gearing. Gross margin increased by 0.6% to 47.4% and concession income by 10.5%
to #5.1 million. Auldene, acquired in the Spring of 2002, contributed well
whilst Crowland and Woodlands, open for trading late in the year, were slightly
earnings dilutive.
The interest charge of #7.1 million reduced by #0.55 million through cash
management and a lower rate of interest.
Adjusted operating profit increased by 8.0% to #28.8 million with margins up by
0.3% to 16.3%. Adjusted operating profit after interest increased by #2.7
million, up 14.1% to #21.7 million with margins up by 0.9% to 12.3%. The
adjusted diluted earnings per share growth of 15.3% ensured we maintained our
creditable compound earnings growth of over 13% p.a. for the 15 years since
flotation.
An underlying taxation charge of 28.5% on adjusted operating profit after
interest compared with 29.5% last year. This 1% reduction in taxation resulted
from capital allowances in excess of depreciation and adjustments in respect of
prior periods offset by an increase in expenses not deductible for tax purposes.
Amortisation of goodwill was #2.7 million and profit on ordinary activities
after taxation was #12.8 million, an increase of 14.1%.
A final dividend of 5.12p is being recommended, making 12.6p for the year, an
increase of 10%. The cost of dividends is #7 million leaving profits retained by
the business of #5.8 million, an increase of #0.9 million.
Acquisitions and Capital Investment
On 30 April 2002 we acquired Auldene Holdings Limited for #3.3 million financed
by the issue of #2.6 million of loan notes with the balance paid in cash. The
value of the tangible fixed assets was #1.1 million, goodwill arising on
acquisition was #2.5 million and the cost of stock #399,000.
The former caravan show site at Crowland was totally refurbished at a cost of
#1.9 million.
Woodlands Nurseries, a very large garden centre including a small production
nursery, Oakheart Limited, was acquired on 26 October 2002 for #10.9 million,
financed by cash with #9.6 million paid prior to 29 December 2002, the deferred
balance of #1.3 million paid in January and February
2003. The fair value of the tangible fixed assets was #4.4 million, goodwill
#5.5 million and the cost of stock #858,000. A detailed breakdown of the costs
of these acquisitions is included in notes 5 and 6.
These acquisitions and developments added 166,000 sq ft of covered retail space.
A further 42,000 sq ft of covered retail space will be added at three centres in
time for Spring 2003. The cost of these developments in 2002 was #2.7 million
and the project costs in total are expected to be #6 million. Internal
refurbishments, new plant sales areas and new and refurbished restaurant
facilities were completed for #2.2 million.
The total investment in acquisitions and developments and in other capital
expenditure was #25.1 million of which #1.3 million was deferred and #2.6
million financed by way of loan notes.
Disposals
The disposals of our last trading High Street shop and of one other property
raised #0.5 million giving a profit of #0.25 million. The development at
Northampton involved demolishing the existing building incurring a charge to the
profit and loss account of #0.3 million. The resultant loss on disposal of
properties was #53,000.
Balance Sheet and Cash Flow
Shareholders' funds increased by #6.4 million to #155.7 million of which #5.8
million arose from retained profits. Net assets per Ordinary share increased by
4% to #2.80.
Significant cash flow continues to be generated from operations showing the
importance of cash management throughout the business. These cash flows
increased by #4.3 million to #37.3 million which included a positive cash flow
from working capital of #1.6 million. Interest, taxation and dividends consumed
#19.3 million. Cash inflow before capital expenditure, acquisitions and
disposals was #18.4 million.
The outflow of funds during the year, including loan notes issued, was #7.8
million leaving net debt at 29 December 2002 of #134.4 million and gearing of
86%.
Treasury Policy
The treasury function operates within clearly defined guidelines and limits and
reports to the Board on a regular basis. The Board reviews and agrees treasury
policies. A number of financial instruments are used to manage the financial
risks faced by the Group. These comprise cash and money market deposits, loan
notes, bank overdrafts and term loans, interest rate agreements and other
debtors and creditors which arise directly from operations. The Group adopts a
conservative approach in all treasury matters and no speculative positions are
taken on financial instruments. It ensures that a sizeable proportion of core
debt is fixed or capped by way of financial instruments whilst still taking
advantage of current interest rates on some core and fluctuating debt. Due
regard is given to trends in interest rates and costs associated with hedging.
During the year we negotiated a new 3 year #45 million facility with The Royal
Bank of Scotland. Following a #15 million reduction in our 'club' facility with
our other bankers in October 2002, total facilities of #170 million are now
available to us.
Accounting Policies
We have continued with SSAP24 'Accounting for Pension Costs' whilst making
further disclosures as required by the transitional arrangement of FRS17 '
Retirement Benefits'. A formal actuarial valuation of the defined benefit
pension scheme is currently being undertaken as at 1 January 2003 by an
independent actuary.
Outlook
We continue to finance our operations from a combination of retained profits and
bank facilities and have demonstrated again that we are able to secure financial
resource for the future growth of the business. The two centres acquired in the
latter part of the year are exciting opportunities and our investment in
acquisitions and redevelopments will continue to deliver growth to the business.
Stephen Murfin
Finance Director
Five Year Record
2002 2001 2000 1999 1998
#000 #000 #000 #000 #000
Sales 176,442 166,842 108,544 95,275 75,492
Increase on previous year 5.8% 53.7% 13.9% 26.2% 19.8%
Like/like increase 2.2% 3.9% 7.7% 8.7% 4.1%
Concession income 5,113 4,628 3,171 2,685 1,833
Property rental income 70 72 66 118 103
Adjusted EBITDA 35,410 32,001 21,708 17,671 13,407
Increase on previous year 10.7% 47.4% 22.8% 31.8% 20.6%
Adjusted EBITDA margin 20.1% 19.2% 20.0% 18.5% 17.8%
Adjusted operating profit 28,826 26,690 17,937 15,241 11,588
Increase on previous year 8.0% 48.8% 17.7% 31.5% 21.4%
Adjusted operating margin 16.3% 16.0% 16.5% 16.0% 15.3%
Adjusted operating profit after interest 21,728 19,042 15,143 13,250 10,328
Increase on previous year 14.1% 25.7% 14.3% 28.3% 14.7%
Adjusted operating margin after interest 12.3% 11.4% 14.0% 13.9% 13.7%
Taxation 6,192 5,617 3,710 3,909 2,876
Profit after taxation 12,824 11,243 8,627 10,539 6,506
Adjusted diluted earnings per share 27.9p 24.2p 24.2p 21.9p 16.9p
Increase on previous year 15.3% - 10.5% 29.6% 14.2%
Dividends per Ordinary share 12.60p 11.45p 10.41p 8.86p 7.70p
Increase on previous year 10.0% 10.0% 17.5% 15.1% 12.2%
Net assets per Ordinary share #2.80 #2.69 #2.66 #1.90 #1.72
In order to provide a uniform comparison of the results of the trading
operations of the business the Adjusted operating profit is before charging
exceptional items and amortisation of goodwill and the Adjusted diluted earnings
per share has been adjusted by exceptional items, amortisation of goodwill and
profit/(loss) on sale of properties. Adjusted EBITDA is the Adjusted operating
profit before charging depreciation. The Adjusted diluted earnings per share,
taxation and profit after taxation for 1998 to 2000 were adjusted in 2001
following the change of accounting policy in respect of FRS19 'Deferred
Taxation'.
Group Profit and Loss Account
2002 2001
for the 52 weeks ended 29 December 2002 Note #000 #000
Sales 176,442 166,842
Cost of sales 92,794 88,827
Gross profit 83,648 78,015
Operating expenses 62,664 58,408
20,984 19,607
Other operating income 5,183 4,700
Operating profit 26,167 24,307
Operating profit before amortisation of goodwill 28,826 26,690
Amortisation of goodwill (2,659) (2,383)
(Loss) profit on sale of properties (53) 201
Profit on ordinary activities before interest 26,114 24,508
Interest payable (7,098) (7,648)
Profit on ordinary activities before taxation 19,016 16,860
Taxation on profit on ordinary activities 6,192 5,617
Profit on ordinary activities after taxation 12,824 11,243
Dividends 1 7,011 6,354
Retained profit 5,813 4,889
Basic earnings per share 3 23.1p 20.7p
Adjustment for amortisation of goodwill 4.8p 4.4p
Adjustment for loss (profit) on sale of properties 0.1p (0.4p)
Adjusted basic earnings per share 3 28.0p 24.7p
Diluted earnings per share 3 23.0p 20.3p
Adjustment for amortisation of goodwill 4.8p 4.3p
Adjustment for loss ( profit) on sale of properties 0.1p (0.4p)
Adjusted diluted earnings per share 3 27.9p 24.2p
Dividends per Ordinary share 1 12.60p 11.45p
All Group operations relate to continuing activities and all recognised gains
and losses are included in the Group profit and loss account.
Group Balance Sheet
2002 2001
29 December 2002 #000 #000
Fixed assets
Intangible assets 53,378 48,040
Tangible assets 243,236 231,412
296,614 279,452
Current assets
Stocks 28,853 27,173
Debtors 4,481 5,009
Money market deposits 8,500 2,000
Cash in hand and at bank 2,418 256
44,252 34,438
Creditors due within one year 46,512 36,402
Net current liabilities (2,260) (1,964)
Total assets less current liabilities 294,354 277,488
Creditors due after more than one year 134,079 124,708
Provisions for liabilities and charges 4,590 3,538
155,685 149,242
Capital and reserves
Called up share capital 13,910 13,870
Share premium account 78,167 77,805
Revaluation reserve 9,359 9,471
Capital redemption reserve 2,812 2,812
Share scheme reserve 488 449
Merger reserve 7,191 7,191
Profit and loss account 43,758 37,644
Shareholders' funds - equity 155,685 149,242
Group Cash Flow Statement
2002 2001
For the 52 weeks ended 29 December 2002 #000 #000 #000 #000
Operating activities
Net cash inflow from operating activities 37,310 33,010
Returns on investments and servicing of finance
Interest received 140 208
Interest paid (7,238) (7,856)
(7,098) (7,648)
Taxation
Corporation tax paid (5,479) (4,292)
Capital expenditure
Payments to acquire tangible fixed assets (13,359) (16,422)
Payments to acquire freehold of leasehold garden centre (118) (1,155)
Receipts from sale of tangible fixed assets 75 591
(13,402) (16,986)
Acquisitions and disposals
Payments to acquire subsidiary undertakings (730) (8,193)
Net overdraft acquired with subsidiaries (4) (1,547)
Deferred payment for acquisition of tangible fixed assets (355) (280)
Payments to acquire businesses (9,571) -
Receipts from sale of trading properties 456 1,200
Cash outflow from provisions - (105)
(10,204) (8,925)
Equity dividends paid (6,743) (6,005)
Cash outflow before management of liquid resources
and financing (5,616) (10,846)
Management of liquid resources
Movement in money market deposits (6,500) 600
Financing
Issue of Ordinary share capital 390 348
Increase in debt 14,768 9,080
15,158 9,428
Increase (decrease) in cash in the year 3,042 (818)
Reconciliation of net cash flow to movement in net debt 2002 2001
#000 #000
Increase (decrease) in cash in the year 3,042 (818)
Cash inflow from increase in debt (14,768) (9,080)
Cash outflow (inflow) from the management
of liquid resources 6,500 (600)
Loan notes issued (2,592) (5,807)
Movement in net debt in the year (7,818) (16,305)
Net debt at 31 December 2001 (126,623) (110,318)
Net debt at 29 December 2002 (134,441) (126,623)
Note of Historical Cost Profits and Losses
2002 2001
#000 #000
Reported profit on ordinary activities before taxation 19,016 16,860
Difference between the historical cost depreciation charge and
the charge on the revalued amount 112 114
Historical cost profit on ordinary activities before taxation 19,128 16,974
Historical cost profit for the year retained after taxation and dividends 5,925 5,003
Reconciliation of Movements in Shareholders' Funds
2002 2001
#000 #000
Profit for the 52 weeks ended 29 December 2002 12,824 11,243
Dividends 7,011 6,354
5,813 4,889
New share capital subscribed less expenses 390 348
Share scheme charge 240 180
Net addition to shareholders' funds 6,443 5,417
Shareholders' funds at 30 December 2001 149,242 143,825
Shareholders' funds at 29 December 2002 155,685 149,242
Notes to the Financial Statements
1. Dividends
2002 2001
#000 #000
Equity dividends on Ordinary shares:
Interim dividend paid of 7.48p per share (2001 6.80p) 4,161 3,772
Proposed final dividend of 5.12p per share (2001 4.65p) 2,850 2,582
Total dividend on Ordinary shares 7,011 6,354
The proposed final dividend of 5.12p per share will be paid on 6 May 2003 to
shareholders on the register on 28 March 2003.
2. The above financial information does not constitute full accounts within the
meaning of Section 254 of the Companies Act 1985. Full accounts for the 52
weeks ended 30 December 2001, which received an unqualified auditors' report,
have been delivered to the Registrar of Companies.
3. Earnings per Share
Earnings per share is calculated on the profit on ordinary activities after
taxation of #12.82 million (2001 #11.24 million), divided by the weighted
average number of Ordinary shares in issue during the year of 55,590,605 (2001
54,208,789). Diluted earnings per share is calculated on the profit on ordinary
activities after taxation divided by the aggregate of the weighted average
number of Ordinary shares in issue and 96,139 (2001 161,974) being the number of
Ordinary shares which are the subject of share options, in total 55,686,744
(2001 55,576,218). The 2001 comparative included 1,205,455 Ordinary shares on
the assumption that the Preference shares then in issue had been converted for
the whole of 2001.
In order to provide a uniform comparison of the results of the trading
operations of the business, the earnings per share comparisons have been made by
making an adjustment to exclude the amortisation of goodwill and the (loss)
profit on sale of properties in addition to the disclosures required by the
effect of FRS3 and FRS14.
4. Notes to the Cash Flow Statement
a) Reconciliation of operating profit to operating cash flows
2002 2001
#000 #000
Operating profit 26,167 24,307
Share scheme charge 240 180
Depreciation 6,584 5,311
Amortisation of goodwill 2,659 2,383
Loss/(profit) on disposal of tangible fixed assets 94 (22)
Increase in stock (1,206) (1,173)
Decrease in debtors 585 1,858
Increase in creditors 2,187 166
Net cash inflow from operating activities 37,310 33,010
4. Notes to Cash Flow Statement Continued
b) Analysis of net debt
At At
29 December Non cash 30 December
2002 Cashflows movement 2001
#000 #000 #000 #000
Cash at bank and in hand 2,418 2,162 - 256
Overdraft - 880 - (880)
2,418 3,042 - (624)
Debt due within one year (11,280) (7,125) (864) (3,291)
Debt due after one year (134,079) (7,643) (1,728) (124,708)
(142,941) (11,726) (2,592) (128,623)
Money market deposits 8,500 6,500 - 2,000
(134,441) (5,226) (2,592) (126,623)
5. Acquisition of Subsidiary Undertakings
(a) Acquisition of Auldene Holdings Limited
Net book and
fair value to
the Group
#000
Tangible fixed assets 1,064
Stock 399
Debtors 21
Creditors (325)
Taxation (83)
Bank overdraft (550)
Cash 314
840
Goodwill arising on acquisition 2,482
3,322
Cost of acquisition satisfied by:
Cash 560
Loan notes 2,592
Costs 170
3,322
(b) Acquisition of Oakheart Limited Net book Fair value Fair value
value adjustment to the Group
#000 #000 #000
Tangible fixed assets 534 (184) 350
Stock 75 - 75
Debtors 36 - 36
Creditors (88) - (88)
Taxation (53) - (53)
Cash 232 - 232
736 (184) 552
Cost of acquisition satisfied by:
Deferred consideration - cash 552
6. Acquisition of Woodlands Nurseries
The Woodlands Nurseries business purchased on 25 October 2002 was a partnership
and book values were not made available to the Company.
Fair value to
the Group
#000
Tangible fixed assets 4,056
Stock 783
4,839
Goodwill 5,515
10,354
Cost of acquisition satisfied by:
Cash - prior to 29 December 2002 9,571
- deferred consideration 783
10,354
Cash
7. The Annual Report and Accounts will be posted to shareholders on 21 March
2003 and will be available from the Company's Registered office at: Kings Acre
Road, Hereford, HR4 0SE. The Company's AGM will be held on 30 April 2003.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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