REG - Card Factory PLC - Final Results <Origin Href="QuoteRef">CARDC.L</Origin> - Part 2

Card FactoryAnnouncement

05/04/2016 07:05

- Part 2: For the preceding part double click  ID:nRSE1330Ua 

quantitative thresholds of a reportable segment as defined in IFRS 8.
Consequently the results of the Group are presented as a single reportable
segment. Revenues outside of the UK are not significant at less than
£0.1million. 
 
The Chief Operating Decision Maker is the Board of Directors. Internal
management reports are reviewed by the Board of Directors on a monthly basis.
Performance of segments is assessed based on a number of financial and
non-financial KPIs including EBITDA (as defined in note 4) and profit before
tax. 
 
3          Operating profit 
 
Operating profit is stated after charging/(crediting) the following items: 
 
                                   2016     2015  
                                   £'m      £'m   
                                                  
 Staff costs (note 5)              91.1     95.0  
 Depreciation expense                             
 - owned fixed assets              8.6      7.7   
 Amortisation expense              1.1      1.1   
 Operating lease rentals:                         
 - land and buildings              36.0     34.6  
 - plant, equipment and vehicles   0.4      0.5   
 Loss on disposal of fixed assets  0.1      -     
 Foreign exchange gain             (4.0)    -     
 
 
4          Underlying EBITDA 
 
Underlying earnings before interest, tax, depreciation and amortisation
('EBITDA') represents underlying profit for the period before net finance
expense, taxation, depreciation and amortisation. 
 
                                2016    2015  
                                £'m     £'m   
                                              
 Underlying operating profit    85.3    79.4  
 Depreciation and amortisation  9.7     8.8   
 Underlying EBITDA              95.0    88.2  
 
 
5          Staff numbers and costs 
 
The average number of people employed by the Group (including Directors)
during the year, analysed by category, was as follows: 
 
                                2016      2015    
                                Number    Number  
                                                  
 Management and administration  321       289     
 Operations                     9,220     8,908   
                                9,541     9,197   
 
 
The aggregate payroll costs of all employees including Directors were as
follows: 
 
                                             2016    2015  
                                             £'m     £'m   
                                                           
 Employee wages and salaries                 81.1    76.4  
 Equity-settled share based payment expense  1.3     10.3  
 Social security costs                       4.5     5.4   
 Defined contribution pension costs          0.3     0.3   
 Total employee costs                        87.2    92.4  
 Agency labour costs                         3.9     2.6   
 Total staff costs                           91.1    95.0  
 
 
6              Finance income and expense 
 
                                                        2016     2015   
                                                        £'m      £'m    
 Finance income                                                         
 Bank interest received                                 (0.3)    (0.3)  
                                                                        
 Finance expense                                                        
 Interest on bank loans and overdrafts                  3.3      8.5    
 Amortisation of loan issue costs                       2.1      9.0    
 Interest on loan notes                                 -        4.3    
 Fair value loss on interest rate derivative contracts  0.1      -      
 Interest on deferred consideration                     -        0.1    
                                                        5.5      21.9   
 Net finance expense                                    5.2      21.6   
 
 
Amortisation of loan issue costs include £1.8 million (2015: £7.7 million)  in
relation to previous loan facilities, expensed to the income statement on
replacement with a new facility and presented as non-underlying, see note 1. 
 
7          Taxation 
 
Recognised in the income statement 
 
                                                    2016     2015   
                                                    £'m      £'m    
 Current tax expense                                                
 Current year                                       16.8     10.6   
 Adjustments in respect of prior periods            (0.1)    (0.7)  
                                                    16.7     9.9    
 Deferred tax credit                                                
 Origination and reversal of temporary differences  0.5      (0.5)  
 Adjustments in respect of prior periods            0.1      0.1    
                                                    0.6      (0.4)  
 Total income tax expense                           17.3     9.5    
 
 
The effective tax rate of 20.7% (2015: 22.3%) is higher than the standard rate
of corporation tax in the UK. The tax charge is reconciled to the standard
rate of UK corporation tax as follows: 
 
                                                                       2016    2015   
                                                                       £'m     £'m    
                                                                                      
 Profit before tax                                                     83.7    42.7   
                                                                                      
 Tax at the standard UK corporation tax rate of 20.16% (2015: 21.32%)  16.9    9.1    
 Tax effects of:                                                                      
 Expenses not deductible for tax purposes                              0.4     1.1    
 Non-taxable income                                                    -       (0.1)  
 Adjustments in respect of prior periods                               -       (0.6)  
 Total income tax expense                                              17.3    9.5    
 
 
8          Dividends 
 
The Board is recommending a final dividend in respect of the financial year
ended 31 January 2016 of 6.0 pence per share (2015: 4.5 pence per share),
resulting in a total final dividend of £20.4 million (2015: £15.4 million).
The dividend will, subject to shareholders' approval at the Annual General
Meeting on 24 May 2016, be paid on 10 June 2016 to shareholders on the
register at the close of business on 6 May 2015. No liability is recorded in
the financial statements in respect of this final dividend as it was not
approved at the balance sheet date. 
 
 Dividends paid in the year:                          Pence per share      2016    2015  
                                                                           £'m     £'m   
                                                                                         
 Special dividend for the year ended 31 January 2016  15.0p                51.1    -     
 Interim dividend for the year ended 31 January 2016  2.5p                 8.5     -     
 Final dividend for the year ended 31 January 2015    4.5p                 15.4    -     
 Interim dividend for the year ended 31 January 2015  2.3p                 7.8     -     
                                                                           82.8          
 
 
Dividends totalling £82.8 million were paid in the year with a further £0.3m
accrued in relation to share based long term incentive schemes. 
 
9          Earnings per share 
 
Basic earnings per share is calculated by dividing the profit for the period
attributable to ordinary shareholders by the weighted average number of
ordinary shares in issue during the period. 
 
Diluted earnings per share is based on the weighted average number of shares
in issue for the period, adjusted for the dilutive effect of potential
ordinary shares. Potential ordinary shares represent employee share incentive
awards and save as you earn share options. 
 
The Group has chosen to present an alternative earnings per share measure,
with profit adjusted for non-underlying items to reflect the Group's
underlying profit for the year. Underlying earnings is not a recognised profit
measure under IFRS and may not be directly comparable with 'adjusted' profit
measures used by other companies. 
 
                                                                   2016           2015         
                                                                   (Number)       (Number)     
                                                                                               
 Weighted average number of shares in issue                        340,696,235    312,568,527  
 Weighted average number of dilutive share options                 478,006        15,919       
 Weighted average number of shares for diluted earnings per share  341,174,241    312,584,446  
 
 
                                                            £'m      £'m   
                                                                           
 Profit for the financial year                              66.4     33.2  
 Non-underlying items                                       (1.4)    17.9  
 Total underlying profit for underlying earnings per share  65.0     51.1  
 
 
                                        pence    pence  
 Basic earnings per share               19.5     10.6   
 Diluted earnings per share             19.5     10.6   
 Underlying basic earnings per share    19.1     16.3   
 Underlying diluted earnings per share  19.1     16.3   
 
 
10        Notes to the cash flow statement 
 
Reconciliation of operating profit to cash generated from operations 
 
                                                         2016     2015   
                                                         £'m      £'m    
                                                                         
 Profit before tax                                       83.7     42.7   
 Net finance expense                                     5.2      21.6   
 Operating profit                                        88.9     64.3   
 Adjusted for:                                                           
 Depreciation and amortisation                           9.7      8.8    
 Loss on disposal of fixed assets                        0.1      -      
 Cash flow hedging foreign currency gains                2.4      0.4    
 Share based payments charge                             1.3      10.3   
 Operating cash flows before changes in working capital  102.4    83.8   
 (Increase)/decrease in receivables                      (3.0)    0.7    
 Increase in inventories                                 (8.9)    (2.2)  
 Increase in payables                                    1.7      2.6    
 Cash inflow from operating activities                   92.2     84.9   
 
 
This information is provided by RNS
The company news service from the London Stock Exchange