TIDMIRGP
RNS Number : 6752U
Indian Restaurants Group PLC
29 June 2009
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Indian Restaurants Group Plc
Half Yearly Report
29 June 2009
Chairman's Statement
Indian Restaurants Group plc (AIM: IRGP) is pleased to announce its interim
results for the six months ended 31 March 2009.
The Group operates Indian restaurants and as outlined in our full year results
announced in March 2009 trading has been affected by global economic climate
uncertainty combined with the UK entering into a recessionary period which has
clearly impacted consumer confidence and adversely impacted discretionary spend.
The weakness in sterling has resulted in an increase in our costs of core fresh
produce and also had an adverse impact on the financial performance. The
business also faces cost pressures on manpower costs, rent and utility costs.
The Group generated revenues of GBP1.3 million in the six months ended 31 March
2009 and a pre-tax loss of GBP0.47 million (H1 2008: loss of GBP0.16 million).
Sales have increased significantly over the comparative low base of the interim
period in the previous year. This is because last year we had only just acquired
the Mela Group and the sales figures were just for one month. This years'
figures also include Mela Redhill which is a new unit that came into operation
in December 2008. Despite the tough economic climate there is good support for
our concepts and high quality fresh food/products, in particular the
enhancements to the menu and service that we have implemented are being well
received by our customers. The feedback from our customers on our food and
service remains consistently positive and this is encouraging for the future.
We have noticed that the current economic situation is impacting consumer
confidence and spending patterns, in London suburbs, resulting in a reduction in
trade during weekdays business whilst Friday and Saturday evenings continue to
trade well. To counter this we are evaluating a number of specific promotional
activities which will help stimulate business in our quieter periods and give us
better utilisation of our resources. With respect to our units in the West End
we have started reducing the levels of promotional discounts, in order to
protect our overall margin. It is good to see that significant investments made
in our promotional activities have resulted encouraging sales, and we will
continue to modify our campaigns according to the changing market conditions.
As we stated in our annual report for the year to September 2008 despite
investing funds and resources in refurbishing Mela, Herne Hill, the Board has
not seen the expected improvement in sales and therefore was continuing to
monitor the performance at this unit very carefully and were evaluating options
for the restaurant. This unit continues to trade at a loss despite this
investment and has failed to respond from a financial perspective. The Company
marketed the unit for sale and received some interest but this has not yet
materialised into an acceptable offer and hence to protect the Group from
further losses it has been decided regrettably to close this unit.
The brands we have are strong and we are looking at possible opportunities to
leverage these brands by seeking additional sources of revenue through
wholesaling and forming alliances with other food units with a view of selling
our food through their channels.
Outlook
We are adopting a very selective expansion plan in the light of the current
challenging economic conditions, whereby we are targeting certain selective
areas which will complement our existing units. We are well placed to take
advantage of the opportunities when the market recovers.
Haresh Kanabar
Chairman
29 June 2009
Contact:
Indian Restaurants Group Plc
0207 297 0010
Haresh Kanabar, Chairman
Amit Pau, Chief Executive
W.H. Ireland
Tim Cofman-Nicoresti/Katy Birkin
0121 265 6330
Indian Restaurants Group Plc
Consolidated Interim Income Statement
for the six months ended 31 March 2009
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | Note | | Unaudited | Unaudited | Audited Year ended 30 |
| | | | 6 months | 6 months | September |
| | | | ended | ended | 2008 |
| | | | 31 March | 31 March | GBP'000 |
| | | | 2009 | 2008 | |
| | | | GBP'000 | GBP'000 | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Revenue | | | 1,362 | 196 | 1,540 |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Administrative expenses | | | (1,836) | (431) | (2,149) |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Loss from operations | | | (474) | (235) | (609) |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Finance income | | | 9 | 71 | 117 |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Loss before taxation | | | (465) | (164) | (492) |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| Loss for the period | | | (465) | (164) | (492) |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+------------------------+
+--------------------------------+----------+-------+-----------+-----------+----------+
| Loss per ordinary share | | | | | |
+--------------------------------+----------+-------+-----------+-----------+----------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+----------+
| Basic and diluted loss per | 3 | | (3.5p) | (1.6p) | (4.2p) |
| share | | | | | |
+--------------------------------+----------+-------+-----------+-----------+----------+
| | | | | | |
+--------------------------------+----------+-------+-----------+-----------+----------+
Indian Restaurants Group Plc
Consolidated Interim Balance Sheet
at 31 March 2009
+---------------------------------+------+------------+-----------+---------------+
| | Note | Unaudited | Unaudited | Audited |
| | | 31 March | 31 March | 30 September |
| | | 2009 | 2008 | 2008 |
| | | GBP'000 | GBP'000 | GBP'000 |
+---------------------------------+------+------------+-----------+---------------+
| Assets | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Non-current assets | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Goodwill | 2 | 2,137 | 2,803 | 2,137 |
+---------------------------------+------+------------+-----------+---------------+
| Property, plant & equipment | | 545 | 497 | 480 |
+---------------------------------+------+------------+-----------+---------------+
| | | 2,682 | 3,300 | 2,617 |
+---------------------------------+------+------------+-----------+---------------+
| Current assets | | 39 | 24 | 26 |
| Inventories | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Trade and other receivables | | 267 | 374 | 318 |
+---------------------------------+------+------------+-----------+---------------+
| Cash and cash equivalents | | 1,048 | 2,267 | 1,372 |
+---------------------------------+------+------------+-----------+---------------+
| | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Total current assets | | 1,354 | 2,665 | 1,716 |
+---------------------------------+------+------------+-----------+---------------+
| Total assets | | 4,036 | 5,965 | 4,333 |
+---------------------------------+------+------------+-----------+---------------+
| | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Liabilities | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Current liabilities | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Trade and other payables | | (1,058) | (2,871) | (720) |
| | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Financial liabilities- | | (306) | (55) | (420) |
| borrowings | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Total liabilities | | (1,364) | 2,926 | (1,140) |
+---------------------------------+------+------------+-----------+---------------+
| Net assets | | 2,672 | 3,039 | 3,193 |
+---------------------------------+------+------------+-----------+---------------+
| | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Non-current liabilities | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Financial liabilities - | | (351) | - | (407) |
| borrowings | | | | |
+---------------------------------+------+------------+-----------+---------------+
| Equity | | 2,321 | 3,039 | 2,786 |
+---------------------------------+------+------------+-----------+---------------+
| Share capital | | 1,308 | 1,308 | 1,308 |
+---------------------------------+------+------------+-----------+---------------+
| Share premium account | | 3,451 | 3,396 | 3,451 |
+---------------------------------+------+------------+-----------+---------------+
| Share based payments reserves | | 133 | - | 133 |
+---------------------------------+------+------------+-----------+---------------+
| Retained losses | | (2,571) | (1,165) | (2,106) |
+---------------------------------+------+------------+-----------+---------------+
| Equity attributable to equity | | 2,321 | 3,039 | 2,786 |
| holders of the parent | | | | |
+---------------------------------+------+------------+-----------+---------------+
| | | | | |
+---------------------------------+------+------------+-----------+---------------+
Indian Restaurants Group Plc
Consolidated Interim Cash Flow Statement
for the six months ended 31 March 2009
+-----------------------------------+------+-------------+-----------+--------------+
| | | Unaudited | Unaudited | Audited |
| | | 6 months | 6 months | Year ended |
| | | ended | ended | 30 September |
| | | 31 March | 31 March | 2008 |
| | | 2009 | 2008 | GBP'000 |
| | | GBP'000 | GBP'000 | |
+-----------------------------------+------+-------------+-----------+--------------+
| Cash outflow from operating | | (23) | (59) | (653) |
| activities | | (9) | | |
| Corporation Tax paid | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| Net cash outflow from operating | | (32) | (59) | (653) |
| activities | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| Investments | | (132) | (325) | (598) |
+-----------------------------------+------+-------------+-----------+--------------+
| Net interest received | | 20 | 71 | 117 |
+-----------------------------------+------+-------------+-----------+--------------+
| | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| Net cash inflow from returns on | | (112) | (254) | (481) |
| investments | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| Financing activities | | (99) | (197) | (243) |
+-----------------------------------+------+-------------+-----------+--------------+
| Net cash (used in)/from financing | | (99) | (197) | (243) |
| activities | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| (Decrease)/ increase in net cash | | (243) | (510) | (1,377) |
+-----------------------------------+------+-------------+-----------+--------------+
| Cash and cash equivalents at | | 1,161 | 2,538 | 2,538 |
| beginning of period | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| Cash and cash equivalents at end | | 918 | 2,028 | 1,161 |
| of period | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
| | | | | |
+-----------------------------------+------+-------------+-----------+--------------+
Indian Restaurants Group Plc
Notes to the consolidated interim statement
for the six months ended 31 March 2009
+-------+----------------------------------------------------------------------+
| 1. | Basis of preparation |
+-------+----------------------------------------------------------------------+
Indian Restaurants Group Plc is a public limited company incorporated and
domiciled in United Kingdom. The principal activity of the company is to operate
a chain of Indian restaurants. The company's ordinary shares are traded on the
AIM market of the London Stock Exchange plc ("AIM").
These interim financial statements for the period ended 31 March 2009, have been
prepared on the basis of the recognition and measurement requirements of IFRS in
issue that are either endorsed by the EU and effective at 30 June 2007.
IAS 34 "Interim financial reporting" has not been early adopted.
The preparation of the interim statement requires management to make judgements,
estimates and assumptions that affect the application of policies and reported
amounts of assets and liabilities, income and expenses. Actual results may
differ from these estimates.
The interim financial statements are unaudited. The financial information
contained in this interim report does not constitute statutory accounts as
defined in section 240 of the Companies Act 1985. The financial information for
the year to 30 September 2007 has been extracted from the statutory accounts for
that year and adjusted for the conversion to IFRS. The statutory accounts for
the year ended 30 September 2008, which were prepared under UK GAAP, received an
unqualified audit report and did not contain a statement made under Section
237(2) and (3) of the Companies Act 1985, and have been filed with the Registrar
of Companies.
+-------+----------------------------------------------------------------------+
| 2. | Significant accounting policies |
+-------+----------------------------------------------------------------------+
The following accounting policies have been applied consistently in dealing with
items which are considered material in relation to the group's financial
statements.
Basis of consolidation
The consolidated financial information for the period to 31 March 2009 include
the results of Indian Restaurants Group Plc and its subsidiary undertakings for
that period. Subsidiary undertakings are entities over which the group has the
power to control the financial and operating policies so as to obtain benefits
from the activities. The group obtains and exercises control through voting
rights.
The group adopts the purchase method in accounting for the acquisition of
subsidiaries. On acquisition the cost is measured at the fair value of the
assets given, plus equity instruments issued and liabilities incurred or assumed
at the date of exchange plus any costs directly attributable to the acquisition.
The assets acquired and liabilities and contingent liabilities assumed in a
business combination are measured at their fair value at the date of
acquisition. Any excess of the fair value of the consideration over the fair
value of the identifiable net assets acquired is recorded as goodwill. Any
deficiency of the fair value of the consideration below the fair value of
identifiable net assets acquired is credited to the income statement in the
period of the acquisition.
The results of subsidiary undertakings acquired or disposed of during the year
are included in the consolidated income statement from the effective date of
acquisition or up to the effective date of disposal.
Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with those used by
the group. Inter-company transactions and balances between group companies are
eliminated.
Critical accounting estimates and judgments
Estimates and judgments are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
Critical accounting estimates and assumptions
The group makes estimates and assumptions concerning the future. Whilst the
directors believe that the estimates and assumptions used in the preparation of
the interim financial statements are reasonable, the resulting accounting
estimates will, by definition, seldom equal the related actual results. The
estimates that have a significant risk of causing a material adjustment to the
carrying values of assets and liabilities within the next financial year are
discussed below.
1) Impairment of goodwill
The group tests whether goodwill has suffered any impairment annually or when
there is an indication of impairment. The recoverable amounts of cash-generating
units have been determined based on value-in-use calculations which require the
use of estimates.
Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value
of the company's share of the net identifiable assets of the acquired subsidiary
at the date of acquisition. Goodwill is included in intangible assets and is
tested annually for impairment or when there is an indication of impairment. Any
impairment is recognised immediately in the income statement and is not
subsequently reversed.
On disposal of a subsidiary, the amount of attributable goodwill is included in
the determination of the profit and loss on disposal.
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation.
The charge for depreciation is calculated to write down the cost of tangible
fixed assets to their estimated residual values by equal annual instalments over
their expected useful lives which are as follows:
Fixtures and fittings15% reducing balance
Motor Vehicles25% reducing balance
Leasehold buildingStraight line over the remaining the term of the lease
Impairment provisions are made where the carrying value of tangible fixed assets
exceeds the recoverable amount.
Revenue recognition
Revenue is recognised on the sale of food and beverages, service charges and
gratuities, exclusive of value added tax.
Taxation
Current tax, including UK corporation tax and foreign tax, is provided on the
group's taxable profits, at amounts expected to be paid using the tax rates and
laws that have been enacted or substantially enacted by the balance sheet date.
Deferred taxation is provided in full using the liability method on temporary
differences between the tax bases of assets and liabilities and their carrying
amounts in the consolidated financial statements. Deferred tax is determined
using tax rates that have been enacted at or substantially enacted by the
balance sheet date and are expected to apply when the related deferred tax asset
is realised or the deferred tax liability is settled.
Deferred tax assets are recognised to the extent that it is probable that future
taxable profit will be available against which the temporary differences can be
utilised.
Leased assets
Expenditure on operating leases is charged to the income statement on a basis
representative of the benefit derived from the asset, normally on a straight
line basis over the lease period.
Where fixed assets are financed by financing arrangements which give rights
approximating to ownership they are treated as if they had been purchased
outright at their fair value and the corresponding commitments are shown in the
balance sheet as obligations under finance leases and hire purchase contracts.
Depreciation of fixed assets acquired under finance leases and hire purchase
contracts is calculated to write off the attributed cost over the shorter of the
lease or contract term and their estimated useful lives by equal annual
instalments. The excess of the total rentals over the amount capitalised is
treated as interest which is charged to the profit and loss account in
proportion to the amounts outstanding under the lease and hire purchase
contracts.
Share based payments
The cost of equity-settled transaction with suppliers of goods and services is
measured by reference to the fair value of the good or service received, unless
that fair value cannot be estimated reliably. The fair value of the good or
service received is recognised as an expense as the Group receives the good or
service. The cost of equity-settled transactions with employees, and
transactions with suppliers where fair value cannot be estimated reliably, is
measured by reference to the fair value of their equity instrument.
The fair value of the equity instrument is determined at the date of grant,
taking into account market based vesting conditions. The fair value is
determined using the Black Scholes Model.
No expense is recognised for awards that do not ultimately vest, except for
awards where the vesting conditions are conditional upon market conditions,
which are treated as vesting irrespective of whether or not the market condition
is satisfied, provided that all other performance conditions are satisfied.
At each balance sheet date before vesting, the cumulative expense is calculated,
representing the extent to which the vesting period has expired and management's
best estimate of the achievement or otherwise of non-market conditions, the
number of equity instruments that will ultimately vest, or in the case of an
instrument subject to a market condition, be treated as vesting as described
above. The movement in cumulative expense since the previous balance sheet date
is recognised in the income statement, with a corresponding entry in equity.
Cash and cash equivalents
Cash and cash equivalents include cash in hand, deposits held at call with
banks, other short term highly liquid funds with original maturities of three
months or less and bank overdrafts. Bank overdrafts are shown within borrowing
in current liabilities on the balance sheet.
Financial instruments
Financial assets and liabilities are recognised in the balance sheet when the
Group becomes party to the contractual provisions of the instrument.
Trade and other receivables
Trade receivables are measured at cost less any provision necessary when there
is objective evidence that the group will not be able to collect all amounts
due.
Trade and other payables
Trade and other payables are not interest bearing and are measured at original
invoice amount.
+-------+--------------------------------------------------------------------------+
| 3. | Loss per ordinary share |
+-------+--------------------------------------------------------------------------+
+--------------------------------------+--------+------------+-----------+--------------+
| | | Unaudited | Unaudited | Audited Year |
| | | 6 months | 6 months | ended |
| | | ended | ended | 30 September |
| | | 31 March | 31 March | 2008 |
| | | 2009 | 2008 | GBP'000 |
| | | GBP'000 | GBP'000 | |
+--------------------------------------+--------+------------+-----------+--------------+
| Basic | | | | |
+--------------------------------------+--------+------------+-----------+--------------+
| Loss attributable to ordinary | | 465 | 164 | 492 |
| shareholders | | | | |
+--------------------------------------+--------+------------+-----------+--------------+
| Weighted average number of shares | | 13,080 | 10,079 | 11,592 |
| 000's | | | | |
+--------------------------------------+--------+------------+-----------+--------------+
| Basic loss per share (pence) | | 3.5 | 1.6 | 4.2 |
+--------------------------------------+--------+------------+-----------+--------------+
There was no dilutive effect from the share options outstanding during the year.
+-------+--------------------------------------------------------------------------+
| 4. | Consolidated Statement of Changes in Equity |
+-------+--------------------------------------------------------------------------+
+--------------------------------+----------+----------+----------+----------+----------+
| | Share | Share | Share | Retained | Total |
| | capital | premium | Based | earnings | |
| | - equity | | Payments | | |
| | | | Reserves | | |
+--------------------------------+----------+----------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------------+----------+----------+----------+----------+----------+
| Year ended 30 September 2008 | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 1 October 2007 | 948 | 2,991 | 99 | (1,614) | 2,424 |
| Shares issued in the period | 360 | 589 | - | - | 949 |
+--------------------------------+----------+----------+----------+----------+----------+
| Share based payments | - | - | 34 | - | 34 |
| Expenses on issue of shares | - | (129) | - | - | (129) |
+--------------------------------+----------+----------+----------+----------+----------+
| Loss for the period | - | - | - | (492) | (492) |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 30 September 2008 | 1,308 | 3,451 | 133 | (2,106) | 2,786 |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| Six months ended 31 March 2008 | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 1 October 2007 | 948 | 2,991 | 99 | (1,515) | 2,424 |
+--------------------------------+----------+----------+----------+----------+----------+
| Shares issued in the period | 360 | 405 | - | - | 765 |
| Share based payments | - | - | 14 | 14 | 14 |
+--------------------------------+----------+----------+----------+----------+----------+
| Loss for the year | - | - | - | (164) | (164) |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 31 March 2008 | 1,308 | 3,396 | 113 | (1,665) | 3,039 |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| Six months ended 31 March 2009 | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 30 September 2008 | 1,308 | 3,451 | 133 | (2,106) | 2,786 |
+--------------------------------+----------+----------+----------+----------+----------+
| Share based payments | - | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| Loss for the period | - | | | (465) | (465) |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
| At 31 March 2009 | 1,308 | 3,451 | 133 | (2,571) | 2,321 |
+--------------------------------+----------+----------+----------+----------+----------+
| | | | | | |
+--------------------------------+----------+----------+----------+----------+----------+
+-------+--------------------------------------------------------------------------+
| 5. | Events after the balance sheet date |
+-------+--------------------------------------------------------------------------+
Management are not aware of any events occurring between the balance sheet date
of these interim financial statements and the date of their approval that would
materially impact the information contained within in these financial
statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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