REG - Fulham Shore PLC - Half-year Report
16/12/2022 07:00
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RNS Number : 9190J Fulham Shore PLC (The) 16 December 2022
The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR").
The Fulham Shore PLC
("Fulham Shore", the "Company" or the "Group")
Unaudited interim results for the six months ended 25 September 2022
The Directors of Fulham Shore, the owner and operator of The Real Greek and
Franco Manca restaurant businesses, are pleased to announce unaudited interim
results for the six months ended 25 September 2022.
Financial Highlights
· Revenues increased 26% to £49.9m (2021: £39.5m)
· Headline EBITDA* of £10.5m (2021: £10.6m)
· Adjusted Headline EBITDA* of £6.0m (2021: £6.9m) reflecting the
absence of the business rates holiday, lower VAT rate, and COVID-19 grants
that were in place during the prior year comparable period
· Operating profit of £2.4m (2021: £4.5m) reflecting higher
one-off pre-opening costs incurred on more new restaurant openings during the
Half Year
· Profit after tax of £0.3m (2021: £2.4m)
· Operating cash inflow of £12.9m (2021: £15.6m)
· Net cash at the end of the Period (excluding lease liabilities)
of £2.8m (2021: £5.1m)
· Post the period end:
o RCF loan facility of £17m extended with HSBC by one year to expire in
November 2025
o As at 15 December 2022, the Group had net cash (excluding lease
liabilities) of £0.7m
o As at 15 December 2022, undrawn debt facilities of £16.9m out of total
facilities of £17.75m
* Definition of Headline EBITDA and Adjusted Headline EBITDA can be found in
note 3 to the unaudited interim financial information.
Operational Highlights
· Opened during the period:
o 11 new Franco Manca pizzerias (one of which was a relocation)
o 2 new The Real Greek restaurants (closed one due to end of lease)
· 93 restaurants operated as at 25 September 2022 (2021: 75)
· Post the period end:
o 2 further Franco Manca opened (to 71 pizzeria)
o 2 further The Real Greek opened (to 26 restaurants)
o Agreed terms of a franchise territory agreement for Franco Manca in Spain
which we believe is a potential major market
o Strategic expansion into retail in November with launch of debut range of
five premium Franco Manca Chef's Selection cook-at-home pizzas available to
purchase in over 500 supermarkets across the UK, with encouraging levels of
sales so far
David Page, Executive Chairman of Fulham Shore, said:
"The Group traded in line with management expectations during the period
despite challenging trading circumstances. This creditable performance was
underpinned by continued strong revenue growth at both Franco Manca and The
Real Greek reflecting both businesses' high-quality food and excellent
value-for-money propositions.
During the six month period the Group made solid strategic progress, opening a
total of 11 net new restaurants in the UK and since the period end have agreed
the terms of a new franchise agreement for Franco Manca in Spain which will
see the opening of two restaurants in the country early next year.
Our UK restaurant expansion is now complemented by the launch of our very
first range of cook-at-home Franco Manca sourdough pizzas into 500 UK
supermarkets. The customer reception to the range has been encouraging since
its launch in November, and we look forward to seeing this develop further
over the coming months and years.
Trading during the first two months of the second half of the financial year
was well ahead of the comparable periods in 2019 and 2021, at 46% and 12%
respectively. Furthermore, the Franco Manca loyalty programme continues to
grow in user numbers with 350,000 users and over 50,000 loyalty pizzas enjoyed
by our loyal customers. Notwithstanding this momentum, the Board remains
mindful that we continue to operate against an unstable political and economic
backdrop, which in turn has impacted consumer confidence and driven up our
costs as well as facing significant challenges from the ongoing transportation
disruption.
Reflecting on this, our aims over the coming 12 months are to conserve cash
for our shareholders, to proceed cautiously, and take advantage of
ever-decreasing rents.
Contacts:
The Fulham Shore PLC www.fulhamshore.com (http://www.fulhamshore.com/)
David Page / Nick Wong Via Hudson Sandler
Singer Capital Markets (Nominated Adviser and Broker)
Shaun Dobson / James Moat / Kailey Aliyar Tel: 020 7496 3000
Hudson Sandler (Financial PR) fulhamshore@hudsonsandler.com (mailto:fulhamshore@hudsonsandler.com)
Alex Brennan / Lucy Wollam / Ben Wilson Telephone: 020 7796 4133
Notes for editors
Information on The Fulham Shore PLC
Fulham Shore owns and operates "The Real Greek" (www.therealgreek.com) and
"Franco Manca" (www.francomanca.co.uk
(file://///10.21.1.3/Nick.Wong%24/My%20Documents/Fulham%20Shore/Interims%20Sept%202018/www.francomanca.co.uk)
) restaurants.
Fulham Shore was incorporated in March 2012. The Directors believed that there
were attractive investment opportunities within the restaurant sector in the
UK and that, given their collective experience in the restaurant sector, they
could take advantage of the opportunities which existed.
The ordinary shares of the Company were admitted to trading on AIM in October
2014 in order to capitalise on such opportunities and to give the company's
employees, customers and public the ability to share in the enterprise.
The Real Greek
Since its foundation in London in 1999, The Real Greek business has grown
steadily, now offering modern Greek cuisine in 26 restaurants across London
and Southern England.
The Real Greek food centres on the delicious, healthy diet of the Eastern
Mediterranean, staying true to the Greek ethos of food, family and friends.
Dishes are created using premium ingredients sourced from Greece and Cyprus
whenever possible, and developed by Tonia Buxton, the face of Greek food in
the UK.
The Real Greek's menu and atmosphere retain the spirit of eating in Greece,
encouraging diners to take their time eating amongst friends and family, be it
a relaxed dinner, family get-together, or a fully catered party.
Franco Manca
Franco Manca opened its first restaurant in 2008 and now has 71 restaurants,
primarily in London, but also with restaurants across the UK (e.g. Cardiff,
Edinburgh, Glasgow, Manchester, Leeds, Cambridge, Birmingham, Brighton,
Bristol and Exeter).
Franco Manca's pizza is made from slow-rising sourdough and is baked in an
oven that produces high heat. The slow levitation and blast cooking process
lock in the flour's natural aroma and moisture, giving a soft and easily
digestible crust. Where possible, locally sourced and organic ingredients are
used.
Franco Manca has received the following accolades:
- Winner of the Peach 20/20 Consumer Choice Award at the 2021 Hero
& Icon Awards
- Winner of the Casual Dining Best Family Dining Experience Award
2020
- Winner of the R200 Best Value Restaurant Operator - Over 20
Sites Award 2019 and 2017
Chairman's statement
Introduction
I am pleased to announce the Group's unaudited interim results for the six
months ended 25 September 2022 (the "Half Year" or the "Period").
During the Period, the Group traded in line with management expectations, with
excellent growth in revenue driven by the enduring popularity of both Franco
Manca and The Real Greek's excellent value-for-money propositions. This was
achieved in spite of challenging political and macroeconomic circumstances as
well as cost inflation and recent sporadic train and tube disruptions that
impacted a number of our city centre locations.
Trading Performance
Group revenues for the Half Year were £49.9m (2021: £39.5m), an increase of
approximately 38% when compared with the same period in 2019, prior to the
onset of Covid-19, and some 26% ahead when compared with the same period to
September 2021.
Headline EBITDA* for the Half Year was in-line with the prior year at £10.5m
(2021: £10.6m). Our Adjusted Headline EBITDA* for the Half Year was lower at
£6.0m (2021: £6.9m) as the business rates holiday, lower VAT rate and COVID
grants, that the Group benefited from last year, ended.
Operating Profit for the Half Year was £2.4m (2021: £4.5m), reflecting the
higher one off pre-opening costs incurred on opening 13 new restaurants during
the Half Year (2021: 3 restaurants), while Profit Before Tax was £0.9m (2021:
£3.1m).
During the Half Year, the Group generated positive cash inflow from operating
activities of £12.9m (2021: £15.6m) and invested £10.6m (2021: £2.2m)
predominantly in fitting out new restaurants. The Group benefited from
landlord contributions which totalled over £0.7m on new sites acquired during
the Half Year.
The Group's net cash position before lease liabilities recognised under IFRS
16 as at 25 September 2022 was £2.8m (2021: £5.1m).
New Openings
During the Half Year, we opened thirteen new restaurants (2021: 3) and closed
two restaurants (2021: Nil), one of which was relocated nearby almost
immediately. The opening programme resulted in pre-opening costs of £1.2m
(2021: £0.2m).
Since the Half Year period end, the Group has opened two more Franco Manca
pizzeria and two The Real Greek, including the first Franco Manca in Wales, in
the centre of Cardiff, and the first The Real Greek in Scotland, which is
located in the successful new shopping scheme St James Quarter, Edinburgh, and
opened just in time for Christmas.
The Group continues to secure desirable sites at favourable rents, supported
by high vacancy rates and lower rents than at the peak levels seen in 2019.
The Group is in various stages of negotiations for eight proposed new
restaurant leases due to open in the next financial year.
Franco Manca Cook At Home Range
Our retail cook at home pizza collaboration with a leading supermarket,
announced on 1 November 2022, is showing early signs of success. Our delicious
range of Franco Manca Chef's Selection sourdough pizzas are being sold in over
500 supermarkets across the UK. The first few weeks of sales have gone well,
reviews are positive, and we believe this will develop an additional source of
revenue over the next few years.
International Expansion
Following the franchise agreement for Greece signed in November 2021, the
Group is pleased to announce that the terms of a franchise territory agreement
for Franco Manca in Spain and Gibraltar have been agreed. The first two
locations will be located in the Malaga area of southern Spain, with more
sites to follow if these prove successful. The Board believes this to be a
major market for the Group and hope to conclude the deal in the new year.
COVID-19 Business Interruption Insurance
We are making progress formulating a COVID 19 business interruption insurance
claim. We believe our policy wording is similar to some recent successful
outcomes for insured parties in our industry. At this stage, however, there
can be no certainty of a financially beneficial outcome for the Group.
Current Trading
Group turnover during the first two months of the second half of the financial
year was well ahead of the comparable periods in 2019 and 2021, by 46% and 12%
respectively, however our costs continue to rise against the backdrop of
subdued early and mid-week trading.
During the second half of the financial year so far our restaurants and our
customers have been buffeted by unstable political and economic circumstances
which in turn have impacted consumer confidence. This is in addition to the
restrictions caused by intermittent train and tube disruption. As a result,
office occupancy in our urban locations has again fallen back to well below
2019 levels.
The Group's trade at weekends especially in suburban sites has held up well
and is in line with management expectations. December has started well and
Franco Manca sales especially have recovered, again driven by strong weekend
trade.
Our restaurant businesses started life in central London and its inner
suburbs. These sites still form a large geographic proportion of our sites.
Following the lifting of COVID restrictions last year some of these office
occupancy figures had been improving week by week. However recent surveys have
shown office occupancy figures have stagnated, remaining at around 42% down
from a weekly average occupancy of 63% back in 2019. Lower office occupancy
has also impacted commuting numbers; in the year to March 2022, London
Waterloo Station carried less than 50% of the commuters that it did in
2019/2020.
As a result, at our office centric locations, Monday and Friday trade has been
particularly negatively impacted since the Half Year, exacerbated by a number
of mid-week tube or rail strikes.
The majority of restaurants in the Group benefited from fixed price energy
contracts that expired at the beginning of October 2022. Energy rates have
doubled since these contracts ended, after taking into account the price cap
introduced by the UK Government. We have been able to offset some of the
resultant margin impact through an energy efficiency drive, benefiting from
agreeing lower rateable values for some of our restaurants and from closing
several rent reviews with nil increases. We will also review our menu
pricing more regularly to cope with these additional costs whilst still aiming
to be better value than a comparative basket of our peer group.
The Franco Manca loyalty programme continues to grow in user numbers, with
350,000 users and over 50,000 loyalty pizzas enjoyed by our loyal customers.
Bank facilities
In November 2022, we are pleased to have signed a one year extension of our
£17m Revolving Credit Facility with HSBC taking the maturity date to November
2025. The Company's net cash position before lease liabilities recognised
under IFRS 16 as at 15 December 2022 was over £ 0.7m. The Group therefore has
undrawn bank facilities of £16.9m, providing substantial financial headroom
of over £17.6m.
Outlook
In our recent Trading Update, announced on 1 November 2022, the Group stated:
'Macroeconomic challenges including inflation, rising interest rates and
political uncertainty continue to affect consumer confidence and combined with
input cost inflation, are presenting trading conditions that are more unstable
and unpredictable than at any time in recent memory. These rising costs and
the availability of any relevant government support leads to a lack of
transparency for short term trading. The Group will review on an ongoing basis
its restaurant opening target for the 2024 financial year, based on the
ever-evolving economic and political outlook, and will share subsequent
updates as appropriate'. This still remains the case.
The continued transport disruption on the approach to Christmas will
inevitably continue to cause more interruptions to our normal trading
patterns. We prudently assume that these transportation strikes are likely to
be equally as disruptive in the coming months. In addition, whilst we hope to
see some recovery, we must assume that the cost of living impacts on consumers
will continue to influence particularly early and mid-week trading and office
centric locations. As a result, the Group is conducting a number of
initiatives in both businesses to boost trade early in the week and at
lunchtime and these are showing early signs of improving sales. Sales from our
retail launch of five cook-at-home Franco Manca pizzas will also partially
mitigate expected lower footfall in the final quarter.
Due to these challenges, the Company expects that trade in the final quarter
of the current financial year is likely to be behind any of the Group's first
three quarters.
Despite the current turbulent trading conditions and the specific disruptions
to trade our restaurants continue to be popular with the UK public driven by
our fantastic value for money menu pricing and the operations team's devotion
to quality food. This gives the Board the strong belief in the long term
performance of the Company.
Although, the Group expects to deliver its 18(th) new opening in spring 2023,
given the pressures outlined above, the Board believes that it would be
imprudent to aim to maintain this opening frequency in the next financial
year. Until the economic situation for our customers and the country improves
and stability returns, the Group will look to target between 5 to 10 new
openings for the next financial year and will continue to fund the opening
programme largely out of operating cash flow.
In addition, several of our original restaurants are now ten years old and
therefore we will be embarking on a refurbishment programme of our existing
estate in 2023, with the aim of increasing covers where possible. We believe
that capital expenditure in this area could match or exceed the return on
investment of a new site.
Conserving cash for our shareholders, proceeding with openings cautiously
and taking advantage of the ever-decreasing rents which are still prevalent
will be our aim over the next 12 months.
The Board is highly experienced and has operated through many of these
periodic social and economic upheavals over the past 40 years. We believe this
political and economic hiatus will eventually pass and we look forward to a
more 'normal' trading environment within the next 12 months.
David Page
Chairman
16 December 2022
* Definition of Headline EBITDA and Adjusted Headline EBITDA can be found in
note 3 to the unaudited interim financial information.
.
The Fulham Shore PLC
Unaudited Consolidated Statement of Comprehensive Income
for the six months ended 25 September 2022
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Notes Unaudited Unaudited Audited
£'000 £'000 £'000
Revenue 49,888 39,458 82,702
Cost of sales (30,572) (24,185) (51,093)
Gross profit 19,316 15,273 31,609
Administrative expenses (15,181) (11,827) (25,039)
Other income 35 1,688 2,401
Headline operating profit 4,170 5,134 8,971
Share based payments (15) (41) (80)
Pre-opening costs (1,236) (162) (733)
Amortisation of brand (411) (411) (821)
Exceptional costs
- impairment of property, plant and equipment - - (602)
- other exceptional costs (111) - -
Operating profit 2,397 4,520 6,735
Finance income - 1 2
Finance costs 4 (1,537) (1,427) (2,863)
Profit before taxation 860 3,094 3,874
Income tax expense 5 (589) (677) (211)
Profit and total comprehensive income for the year attributable to owners of
the company
271 2,417 3,663
Basic 6 0.0p 0.4p 0.6p
Diluted 6 0.0p 0.4p 0.6p
There were no other comprehensive income items.
The Fulham Shore PLC
Unaudited Consolidated Balance Sheet
as at 25 September 2022
As at As at As at
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
Notes £'000 £'000 £'000
Non-current assets
Intangible assets 22,797 23,679 23,233
Property, plant and equipment 126,376 100,373 110,499
Investments 66 - 66
Trade and other receivables 742 788 672
Deferred tax assets 556 823 806
150,537 125,663 135,276
Current assets
Inventories 3,002 2,153 2,399
Trade and other receivables 6,817 4,395 4,308
Cash and cash equivalents 7 3,674 16,211 6,141
13,493 22,759 12,848
Total assets 164,030 148,422 148,124
Current liabilities
Trade and other payables (27,696) (21,133) (20,707)
Borrowings 8 (7,270) (12,311) (6,527)
Income tax payables (714) (743) (368)
(35,680) (34,187) (27,602)
Net current liabilities (22,187) (11,428) (14,754)
Non-current liabilities
Borrowings 8 (87,251) (74,959) (79,702)
Deferred tax liabilities (1,448) (1,438) (1,455)
(88,699) (76,397) (81,157)
Total liabilities (124,379) (110,584) (108,759)
Net assets 39,651 37,838 39,365
Equity
Share capital 6,348 6,205 6,348
Share premium account 9,376 9,153 9,376
Merger relief reserve 30,459 30,459 30,459
Reverse acquisition reserve (9,469) (9,469) (9,469)
Retained earnings 2,937 1,490 2,651
Total equity 39,651 37,838 39,365
The Fulham Shore PLC
Unaudited Consolidated Statement of Changes in Equity
for the six months ended 25 September 2022
Six months ended 25 September 2022
Unaudited
Attributable to owners of the Company
Equity
Merger Reverse Share-
Share Share Relief Acquisition Retained holders '
capital premium Reserve Reserve earnings Funds
£'000 £'000 £'000 £'000 £'000 £'000
At 27 March 2022 6,348 9,376 30,459 (9,469) 2,651 39,365
Profit for the period - - - - 271 271
Total comprehensive income for the period
- - - - 271 271
Transactions with owners:
Share based payments - - - - 15 15
Total transactions with owners
- - - - 2,937 2,937
At 25 September 2022
6,348 9,376 30,459 (9,469) 2,937 39,651
Six months ended 26 September 2021
Unaudited
Attributable to owners of the Company
Equity
Merger Reverse Share-
Share Share Relief Acquisition Retained holders '
capital premium Reserve Reserve earnings Funds
£'000 £'000 £'000 £'000 £'000 £'000
At 29 March 2020 6,191 9,078 30,459 (9,469) (802) 35,457
Profit for the period - - - - 2,417 2,417
Total comprehensive income for the period
- - - - 2,417 2,417
Transactions with owners:
Share based payments - - - - 41 41
Deferred tax on share based payments
- - - - (166) (166)
Issue of new ordinary shares
14 75 - - - 89
Total transactions with owners
14 75 - - 2,292 2,381
At 26 September 2021
6,205 9,153 30,459 (9,469) 1,490 37,838
Year ended 27 March 2022
Audited
Merger Reverse
Share Share Relief Acquisition Retained Total
Capital Premium Reserve Reserve Earnings Equity
£'000 £'000 £'000 £'000 £'000 £'000
At 28 March 2021 6,191 9,078 30,459 (9,469) (802) 35,457
Profit for the year - - - - 3,663 3,663
Total comprehensive income
- - - - 3,663 3,663
Transactions with owners:
Share based payments - - - - 80 80
Deferred tax on share based payments
- - - - (290) (290)
Exercise of share options 157 298 - - - 455
Total transactions with owners
157 298 - - 3,453 3,908
At 27 March 2022 6,348 9,376 30,459 (9,469) 2,651 39,365
The Fulham Shore PLC
Unaudited Consolidated Cash Flow Statement
for the six months ended 25 September 2022
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
Notes £'000 £'000 £'000
Net cash from operating activities 9 12,929 15,642 24,453
Investing activities
Acquisition of property, plant and equipment (10,639) (2,165) (7,799)
Acquisition of intangible assets (4) (2) (2)
Acquisition of investments - - (66)
Net cash flow used in investing activities (10,643) (2,167) (7,867)
Financing activities
Proceeds from issuance of new ordinary shares (net of expenses)
- 89 455
Capital repaid on bank borrowings (1,000) (4,738) (14,000)
Principal element of lease payments (2,216) (3,459) (6,309)
Interest received - 1 2
Interest paid (1,537) (1,427) (2,863)
Net cash used in financing activities (4,753) (9,534) (22,715)
Net increase in cash and cash equivalents (2,467) 3,941 (6,129)
Cash and cash equivalents at beginning of the period
6,141 12,270 12,270
Cash and cash equivalents at end of period 7 3,674 16,211 6,141
The Fulham Shore PLC
Notes to the Unaudited Interim Financial Information
for the six months ended 25 September 2022
1. General information
The Fulham Shore PLC is a public limited company incorporated and domiciled in
England and Wales. The address of the registered office is 1(st) Floor, 50-51
Berwick Street, London, W1F 8SJ, United Kingdom. Copies of this Interim
Statement may be obtained from the above address or the investor section of
the Group's website at http://www.fulhamshore.com (http://www.fulhamshore.com)
.
2. Basis of preparation
The unaudited interim financial information for the six months ended 25
September 2022 has been prepared under applicable law UK-adopted International
Accounting Standards (UK-IAS) based on the accounting policies consistent with
those used in the financial statements for the period ended 27 March 2022, but
does not contain all the information necessary for full compliance with
UK-IAS.
The unaudited interim financial information was approved and authorised for
issue by the Board on 16 December 2022.
The unaudited interim financial information for the six months ended 25
September 2022 does not constitute statutory accounts within the meaning of
section 434 of the Companies Act 2006 and should be read in conjunction with
the statutory accounts for the period ended 27 March 2022. The information for
the period ended 27 March 2022 has been extracted from the statutory accounts
for that period which have been delivered to the Registrar of Companies. The
audit report on these statutory accounts was unqualified, did not contain an
emphasis of matter paragraph, and did not contain a statement under sections
498(2)-(3) of the Companies Act 2006.
The unaudited interim financial information are presented in Pounds Sterling
because that is the currency of the primary economic environment in which the
company operates. All values are rounded to the nearest one thousand Pounds
(£'000) except when otherwise indicated.
Changes in accounting policies and disclosures:
There were no changes in accounting policies and disclosures during the
period.
Going Concern
The Directors have reviewed the Group's working capital position, forecasts,
the impact of inflation, availability of potential equity funding, other
longer term plans and the financial resources and bank facilities in place
that are available to deal with the business risks of the Group along with the
significant covenant headroom. The Group had net funds, before lease
liabilities recognised under IFRS 16, as at 15 December 2022 of £0.7m thus
having headroom of some £17.6m available. The main long term revolving credit
facility was extended in November 2022 by an additional year and does not
require repayment before November 2025, Additionally, the Group's opening
programme has been and can be adjusted fluidly to take account of business
risks and the wider economic risks. The Directors feel well placed to manage
the business risks successfully within the present financial arrangements.
The Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future,
being a period of at least twelve months from the approval of this financial
information. Thus, they continue to adopt the going concern basis of
accounting in preparing the interim financial information.
3. Segment information
For management purposes, the Group was organised into two operating divisions
during the 6 months ended 25 September 2022. These divisions, The Real Greek
and Franco Manca, are the basis on which the Group reports its primary segment
information as identified by the chief operating decision maker which is the
Group's board of directors.
For the six months ended 25 September 2022 (Unaudited)
The Real Franco
Greek Manca Other
segment segment unallocated Total
£'000 £'000 £'000 £'000
External revenue 18,482 31,494 (88) 49,888
Headline EBITDA* 3,752 7,136 (435) 10,453
Depreciation and amortisation (1,930) (4,340) (13) (6,283)
Headline operating profit/(loss) 1,822 2,796 (448) 4,170
Share based payments (4) (5) (6) (15)
Pre-opening costs (222) (1,014) - (1,236)
Amortisation of brand - (411) - (411)
Exceptional costs (12) (99) - (111)
Operating profit/(loss) 1,584 1,267 (454) 2,397
Finance income - - - -
Finance costs (497) (930) (110) (1,537)
Segment profit/(loss) before taxation 1,087 337 (564) 860
Income tax expense (589)
Profit for the period 271
Assets 47,255 115,368 1,407 164,030
Liabilities (42,227) (79,093) (3,059) (124,379)
Net assets/(liabilities) 5,028 36,275 (1,652) 39,651
Capital additions to PPE 5,194 17,832 - 23,026
Capital expenditure excluding right of use assets
1,235 9,404 - 10,639
For the six months ended 26 September 2021 (Unaudited)
The Real Franco
Greek Manca Other
segment segment unallocated Total
£'000 £'000 £'000 £'000
External revenue 13,712 25,746 - 39,458
Headline EBITDA* 4,247 7,098 (792) 10,553
Depreciation and amortisation (1,451) (3,954) (14) (5,419)
Headline operating profit/(loss) 2,796 3,144 (806) 5,134
Share based payments (14) (20) (7) (41)
Pre-opening costs (40) (122) - (162)
Amortisation of brand - (411) - (411)
Operating profit/(loss) 2,742 2,591 (813) 4,520
Finance income - 1 - 1
Finance costs (394) (836) (197) (1,427)
Segment profit/(loss) before taxation 2,348 1,756 (1,010) 3,094
Income tax expense (677)
Profit for the period 2,417
Assets 41,664 102,124 4,634 148,422
Liabilities (31,179) (65,364) (14,041) (110,584)
Net assets/(liabilities) 10,485 36,760 (9,407) 37,838
Capital additions to PPE 4,726 6,065 2 10,793
Capital expenditure excluding right of use assets
601 1,562 2 2,165
For the year ended 27 March 2022 (Audited)
The Real Franco
Greek Manca Other
segment segment unallocated Total
£'000 £'000 £'000 £'000
Revenue from external customers 29,121 53,465 116 82,702
Headline EBITDA* 7,635 14,157 (1,454) 20,338
Depreciation and amortisation (3,285) (8,055) (27) (11,367)
Headline operating profit/(loss) 4,350 6,102 (1,481) 8,971
Share based payments (27) (37) (16) (80)
Pre-opening costs (346) (387) - (733)
Amortisation of brand - (821) - (821)
Impairment of property plant and equipment
(602) - - (602)
Operating profit/(loss) 3,375 4,857 (1,497) 6,735
Finance income - 2 - 2
Finance costs (855) (1,649) (359) (2,863)
Segment profit/(loss) before taxation 2,520 3,210 (1,856) 3,874
Income tax expense (211)
Profit for the year from continuing operations
3,663
Assets 43,753 103,091 1,280 148,124
Liabilities (36,566) (67,567) (4,626) (108,759)
Net assets/(liabilities) 7,187 35,524 (3,346) 39,365
Capital additions to PPE 12,814 14,679 7 27,500
Capital additions excluding right of use assets
3,313 4,479 7 7,799
In addition to the revenues generated from external customers, The Real Greek
segment also generated internal revenues from another segment to the value of
£203,000 (2021: £155,000).
Head office and PLC costs are not related to the Group's two business segments
and are therefore included in other unallocated and are not part of a business
segment.
The Group's two business segments primarily operate in one geographical area
which is the United Kingdom.
* Headline EBITDA and Adjusted Headline EBTIDA are key measures for the Group
as well as industry analysts as they are indicative of ongoing EBITDA
generation of the businesses. Headline EBITDA is defined as EBITDA before
share based payments and pre-opening costs, where EBITDA is defined as
operating profit before depreciation and amortisation, amortisation of brand,
impairment of property, plant and equipment, impairment of goodwill and
intangible assets, impairment and changes in fair value of investments,
COVID-19 related costs, restructuring costs, costs of reverse acquisition,
cost of acquisition and loss on disposal of property, plant and equipment.
Adjusted Headline EBITDA is defined as Headline EBITDA less rent expense
calculated on an accrual basis which excludes the effect of IFRS16.
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Profit before taxation 860 3,094 3,874
Finance costs 1,537 1,427 2,863
Finance income - (1) (2)
Operating profit 2,397 4,520 6,735
Depreciation and amortisation 6,283 5,419 11,367
Amortisation of brand 411 411 821
Exceptional costs:
- impairment of property, plant and equipment - - 602
- other exceptional costs 111 - -
EBITDA 9,202 10,350 19,525
Share based payments 15 41 80
Pre-opening costs 1,236 162 733
Headline EBITDA 10,453 10,553 20,338
Adjustment for rent expenses (4,415) (3,697) (7,945)
Adjusted headline EBITDA 6,038 6,856 12,393
4. Finance costs
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Interest expense on bank loans and overdrafts 110 201 362
Interest on lease liabilities recognised under IFRS16 1,427 1,226 2,501
1,537 1,427 2,863
5. Income Tax Expense
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Income tax expense on continuing operations
Based on the result for the period:
UK Corporation tax at 19% (2021: 19%) 346 734 627
Adjustment in respect of prior periods - - (269)
Total current tax 346 734 358
Deferred taxation:
Current year 243 (57) (147)
Total deferred tax 243 (57) (147)
Total taxation expense on profit from continuing operations
589 677 211
6. Earnings per share
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Profit for the purposes of basic and diluted earnings per share (continuing
operations):
271 2,417 3,663
Share based payments 15 41 80
Deferred tax on share based payments (25) (95) (81)
Pre-opening costs 1,236 162 733
Amortisation of brand 411 411 821
Deferred tax on amortisation of brand (68) (69) (137)
Loss on disposal - - 64
Exceptional costs
- impairment of property, plant and equipment - - 602
- other exceptional costs 111 - -
Headline profit for the period for the purposes of Headline basic and diluted
earnings per share
1,951 2,867 5,745
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Weighted average number of ordinary shares in issue for the purposes of basic
earnings per share
629,475 619,230 626,794
Effect of dilutive potential ordinary shares:
- Share options 10,385 24,739 12,386
Weighted average number of shares for the purpose of diluted earnings per
share
639,860 643,969 639,180
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Earnings per share:
Basic earnings per share 0.0p 0.4p 0.6p
Diluted earnings per share 0.0p 0.4p 0.6p
Headline basic 0.3p 0.5p 0.9p
Headline diluted 0.3p 0.4p 0.9p
7. Cash and cash equivalents
As at As at As at
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Cash at bank and in hand 3,674 16,211 6,141
Bank balances comprise cash held by the Group on a short term basis with
maturity of three months or less. The carrying amount of these assets
approximates their fair value.
8. Borrowings
As at As at As at
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Short term borrowings:
Bank loans - 4,850 -
Lease liabilities 7,270 7,461 6,527
7,270 12,311 6,527
Long term borrowings:
Bank loans 850 6,262 1,850
Lease liabilities 86,401 68,697 77,852
87,251 74,959 79,702
94,791 87,270 86,229
As at 25 September 2022, the Group's committed Sterling borrowing facilities
comprised a revolving credit facility of £17,000,000 (2021: £14,250,000)
expiring between one and five years and a bank overdraft facility of £750,000
repayable on demand, all of which are secured by a mortgage debenture in
favour of HSBC Bank PLC representing fixed or floating charges over the assets
of the Group. As at 25 September 2022, the Group had £16,900,000 undrawn
headroom across its banking facilities.
9. Note to cash flow statements
Reconciliation of net cash flows from operating activities
Six months Six months Year
ended ended ended
25 September 26 September 27 March
2022 2021 2022
Unaudited Unaudited Audited
£'000 £'000 £'000
Profit/(loss) for the period 271 2,417 3,663
Adjustments:
Income tax expense 589 677 211
Profit before tax for the period 860 3,094 3,874
Finance income - (1) (2)
Finance costs 1,537 1,427 2,863
Operating profit for the period 2,397 4,520 6,735
Depreciation and amortisation 6,694 5,829 12,188
Impairment of property, plant and equipment - - 602
Loss on disposal of property, plant and equipment 15 - 65
Other exceptional costs 96 - -
Share based payments expense 15 41 80
Operating cash flows before movement in working capital
9,217 10,390 19,670
Increase in inventories (603) (177) (423)
Increase in trade and other receivables (2,674) (1,527) (1,324)
Increase in trade and other payables 6,989 6,956 6,530
Cash generated from operations 12,929 15,642 24,453
Income taxes paid - - -
Net cash from operating activities 12,929 15,642 24,453
9. Note to cash flow statements (continued)
Changes in net debt from financing activities
Six months ended 25 September 2022 (Unaudited)
Bank Bank Lease Lease
Cash loans loans Total liabilities liabilities
and due due before due due
Cash within after lease within after
Equivalents 1 year 1 year liabilities 1 year 1 year Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Net cash/(debt) as at
27 March 2022 6,141 - (1,850) 4,291 (6,527) (77,852) (80,088)
Cash flows (2,467) - 1,000 (1,467) 2,216 - 749
Reallocation - - - - (1,984) 1,984 -
Additions to lease liabilities
- - - - (1,048) (10,746) (11,794)
Remeasurements to lease liabilities
- - - - (6) (586) (592)
Reduction to lease liabilities
- - - - 79 799 878
Net cash/(debt) as at
25 September 2022 3,674 - (850) 2,824 (7,270) (86,401) (90,847)
Net cash/ (net debt) before lease liabilities recognised under IFRS 16 as at
25 September 2022 was net cash of £2,824,000 (2021: £5,099,000).
Six months ended 26 September 2021 (Unaudited)
Bank Bank Lease Lease
Cash loans loans Total liabilities liabilities
and due due before due due
Cash within after lease within after
Equivalents 1 year 1 year liabilities 1 year 1 year Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Net cash/(debt) as at
28 March 2021 12,270 (3,730) (12,120) (3,580) (7,909) (63,078) (74,567)
Cash flows 3,941 3,730 1,008 8,679 3,459 - 12,138
Reallocation - (4,850) 4,850 - (2,230) 2,230 -
Additions to lease liabilities
- - - - (759) (6,953) (7,712)
Remeasurements to lease liabilities
- - - - (22) (896) (918)
Net cash/(debt) as at
26 September 2021 16,211 (4,850) (6,262) 5,099 (7,461) (68,697) (71,059)
Year ended 27 March 2022 (Audited)
Bank Bank Lease Lease
Cash loans loans Total liabilities liabilities
and due due before due due
Cash within after lease within after
Equivalents 1 year 1 year liabilities 1 year 1 year Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000
Net cash/(debt) as at
28 March 2021 12,270 (3,730) (12,120) (3,580) (7,909) (63,078) (74,567)
Cash flows (6,129) - 14,000 7,871 6,309 - 14,180
Reallocation - 3,730 (3,730) - (3,242) 3,242 -
Additions to lease liabilities
- - - - (1,662) (17,050) (18,712)
Remeasurements to lease liabilities
- - - - (23) (966) (989)
Net cash/(debt) as at
27 March 2022 6,141 - (1,850) 4,291 (6,527) (77,852) (80,088)
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