REG - Tasty PLC - Preliminary Results <Origin Href="QuoteRef">TAST.L</Origin>

TastyAnnouncement

30/03/2015 07:01

RNS Number : 7511I
Tasty PLC
30 March 2015
Tasty plc
("Tasty" or the "Company")
Preliminary results for the 52 weeks ended 28 December 2014
Highlights:
 Revenue up 28% to 29,734,000 (2013 - 23,192,000)
 Gross profit up 26% to 3,527,000 (2013 - 2,806,000)
 Profit before tax up 46% to 2,552,000 (2013 - 1,742,000)
 Seven new Wildwood and Wildwood Kitchen restaurants opened in the year
 Three new restaurants have opened since the year end
 A number of other sites in the pipeline at various stages of completion
Enquiries:
Tasty plc  Tel: 020 7637 1166
Jonny Plant, Chief Executive
Cenkos Securities   Tel: 020 7397 8927
Bobbie Hilliam
Harry Pardoe
Chairman's statement
I am pleased to be reporting on the Group's profitable results of 2,052,000(December 2013 - 1,442,000). The results are for the 52week period ended 28 December 2014 and a comparative of the 52 week period ended 29 December 2013.
Results

Revenue for the year was up 28% on last year to 29,734,000 (2013 - 23,192,000). Operating profit before pre-opening costs and non-trading items was up 34% on last year at 3,090,000(2013 - 2,301,000). Pre-opening costs for the period totalled 360,000(2013 - 259,000).
The overall statutory pre-tax profit was up by some 46% at 2,552,000 (2013 - 1,742,000).
The Board does not recommend the payment of a dividend at this stage of the Group's development.
Openings

Seven new Wildwood and Wildwood Kitchen restaurants were opened during the year: Oakham and Salisbury opened in March. Camberley, Nottingham and Ludlow were all opened in August with Bristol and Wantage opening in November and December respectively.
Since the year end a further three sites have been opened and a number of other sites are already in the pipeline, at various stages of completion and negotiation.
Cash flows

Net cash outflow for the period before financing was 1,061,000 (2013 - 1,531,000). This is largely represented by capital expenditure on the expansion of the business through the opening of the above sites. Cash flows from operating activities increased to 5,308,000 (2013 - 3,238,000).
The Company continued to have access to its banking facility of 4,000,000 (1,000,000 term loan and 3,000,000 revolving facility which remains unused). During the year the Company repaid 250,000 of the term loan. As at 28 December 2014 the balance of the Company's term loan was 750,000.
Cash and cash equivalents held at the end of the period were 2,044,000 (2013 - 3,407,000).

Review of the business

The Group delivered another strong performance in 2014, with an improvement in operating profit margin and a 46% increase in pre-tax profits.
The Group continued its expansion during the year, adding seven new sites to the estate. The rate of development will accelerate in the medium term. Openings in the coming 12 months will expand the UK geographical footprint of the estate.
At the end of the period the Group operated 36 restaurants. Currently, the Group has 39 restaurants in operation - 6 DimTs, 32 Wildwoods and Wildwood Kitchens and 1 other.
Pre-opening costs and accounting adjustments
Pre-opening costs have been highlighted in the income statement as these costs represent revenue expenses, suchas rent, rates and training costs, which are necessarily incurred in the period before a new unit is opened, but whichare specific to the opening of that unit and not part of the Group's normal ongoing trading performance.The Grouprecognises a number of charges in the accounts which arise under accounting rules which have no transactional cashimpact. These charges include share based payments.
Staff

As ever, it is our dedicated staff that have contributed significantly throughout the year to the Group's much improved performance, and I would like to take this opportunity of thanking them again for their hard work and effort.
Current Trading

Since the year end trading has been in line with expectations.
Keith Lassman
Chairman
30 March 2015
Strategic report
Business review and key performance indicators

Revenue for the 52 week period increased 28% on last year to 29,734,000 (2013 - 23,192,000). Operating profit before pre-opening costs and non-operating items was 3,090,000 (2013 - 2,301,000). Pre-opening costs for the period totalled 360,000 (2013 - 259,000). The overall statutory pre-tax profit was 2,552,000 (2013 - 1,742,000).
The Directors utilise a large number of detailed performance indicators which are used to manage the business but, as with most businesses, the focus in the Income Statement at the top level is on sales, margins and overheads compared to budget and the previous year. In the balance sheet the focus is on managing working capital.
The Directors recognise the importance of customer relations and staff are extensively trained in this regard. Performance is monitored by reference to the results of regular mystery diner visits and staff bonuses are calculated with the results and comments arising from these visits and other customer feedback.
A further review of the business is included in the Chairman's Statement.
Principal uncertainties and risks
Economic conditions
There have been a number of encouraging signs regarding the UK economic outlook. However, there still remains a high level of uncertainty. Deterioration in consumer confidence due to future economic conditions could have a detrimental impact on the Group in terms of footfall and sales. This risk is mitigated by the positioning of the Group's brands, which is within the affordable segment of the casual dining market. Continued focus on customer relations and targeted and adaptable marketing initiatives help the Group retain and drive sales where footfall declines.
Input cost inflation
The Group's key variable inputs are the cost of food and labour, both of which face inflationary pressures in the medium term. The Group monitors its food supply chain closely, regularly reviewing food costs and implementing a variety of strategies to mitigate the impact of increases. Labour cost pressures which are outside of the control of the Group, such as the recently introduced auto enrolment pension costs and minimum wage increases, are suffered by the Group and its competitors. However, labour costs are regularly monitored and on-going initiatives are used to reduce the impact of such pressures.
Strategic risks
The acquisition of suitable and well located quality sites in order to continue the Group's expansion is proving to be demanding. The Group has a strong and experienced property acquisition team with good relationships with external agents and advisers.
On behalf of the Board.

Jonny Plant
Joint Chief Executive Officer
30 March 2015
Consolidated statement of comprehensive income for the 52 weeks ended 28 December 2014

2014
2013
'000
'000
Revenue
29,734
23,192
Cost of sales
(26,207)
(20,386)
Gross profit
3,527
2,806
Administrative costs
(901)
(944)
Operating profit excluding non-trading items and pre-opening costs
3,090
2,301
Pre-opening costs
(360)
(259)
Non-trading items
(104)
(180)
Operating profit
2,626
1,862
Finance income
9
14
Finance expense
(83)
(134)
Profit before tax
2,552
1,742
Income tax expense
(500)
(300)
Profit and total comprehensive income for the period attributable to shareholders
2,052
1,442
Earnings per share
Basic
3.88p
2.95p
Diluted
3.83p
2.90p
Consolidated statement of changes in equity for the 52 weeks ended 28 December 2014
Share capital
Share premium
Merger reserve
Retained deficit
Total
'000
'000
'000
'000
'000
Balance at 30 December 2012
4,790
10,359
992
(3,794)
12,347
Issue of ordinary shares
503
2,958
-
-
3,461
Total comprehensive income for the period
-
-
-
1,442
1,442
Share based payments - credit to equity
-
-
-
195
195
Balance at 29 December 2013
5,293
13,317
992
(2,157)
17,445
Issue of ordinary shares
12
19
-
-
31
Total comprehensive income for the period
-
-
-
2,052
2,052
Share based payments - credit to equity
-
-
-
104
104
Balance at 28 December 2014
5,305
13,336
992
(1)
19,632
Consolidated balance sheet at 28 December 2014
2014
2013
'000
'000
Non-current assets
Intangible assets
444
446
Property, plant and equipment
20,391
15,384
Pre-paid operating lease charges
1,731
1,895
Other non-current assets
341
381
22,907
18,106
Current assets
Inventories
1,051
811
Trade and other receivables
1,801
1,350
Pre-paid operating lease charges
152
152
Cash and cash equivalents
2,044
3,407
5,048
5,720
Total assets
27,955
23,826
Current liabilities
Trade and other payables
(6,536)
(5,009)
Borrowings
(500)
(250)
(7,036)
(5,259)
Non-current liabilities
Provisions
(55)
(65)
Lease incentives
(367)
(192)
Deferred tax liability
(615)
(115)
Long-term borrowings
(250)
(750)
(1,287)
(1,122)
Total liabilities
(8,323)
(6,381)
Total net assets
19,632
17,445
Equity
Share capital
5,305
5,293
Share premium
13,336
13,317
Merger reserve
992
992
Retained deficit
(1)
(2,157)
Total equity
19,632
17,445
Consolidated cash flow statement for the 52 weeks ended 28 December 2014

2014
2013
'000
'000
Operating activities
Cash generated from operations
5,308
3,238
Corporation tax paid
-
-
Net cash inflow from operating activities
5,308
3,238
Investing activities
Purchase of property, plant and equipment
(6,378)
(4,783)
Interest received
9
14
Net cash flows used in investing activities
(6,369)
(4,769)
Financing activities
Net proceeds from issues of ordinary shares
31
3,461
Bank loan receipt
-
1,500
Bank loan repayment
(250)
(1,500)
Interest paid
(83)
(134)
Net cash flows used in financing activities
(302)
3,327
Net increase in cash and cash equivalents
(1,363)
1,796
Cash and cash equivalents as at 29 December 2013
3,407
1,611
Cash and cash equivalents as at 28 December 2014
2,044
3,407
Notes forming part of the financial statements for the 52 weeks ended 28 December 2014
1 Basis of consolidation
The financial information in these preliminary results has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively Adopted IFRSs). They are presented in pounds sterling, rounded to the nearest thousand. The same accounting policies, presentation and methods of computation have been followed in the preparation of these results as were applied in the Company's 2013 Report and Accounts.

The financial information set out in this announcement does not constitute the Company's statutory accounts for the 52 weeks ended 28 December 2014 or the 52 weeks ended 29 December 2013. Statutory accounts for the 52 weeks ended 28 December 2014 and the 52 weeks ended 29 December 2013 have been reported on by the Independent Auditors. The Independent Auditors' Report on the Annual Report and Financial Statement for both periods was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

The Annual Report and Financial Statements for 2013 have been filed with the Registrar of Companies. The statutory accounts for the 52 weeks ended 28 December 2014 will be delivered to the Registrar in due course.
2 Revenue
Revenue represents amounts received and receivable for goods and services provided (excluding value added tax) in the normal course of business. Revenue is recognised at the point goods and services are provided. 
3 Operating profit
2014
2013
This has been arrived at after charging
'000
'000
Staff costs
10,691
8,115
Share based payments
104
195
Operating lease rentals
3,101
2,630
Amortisation of intangible assets
2
2
Depreciation
1,310
1,222
Amortisation of prepaid operating leases
164
213
Loss on disposal
61
83
Auditor remuneration:
Audit fee - Parent Company
8
8
 - Group financial statements
10
8
 - Subsidiary undertaking
20
17
Other services - Taxation compliance
6
6
 - Other taxation advisory
6
24
4 Finance expense
2014
2013
'000
'000
Loan interest payable
83
134
83
134

5 Employees
2014
2013
Staff costs (including directors) consist of
'000
'000
Wages and salaries
9,779
7,520
Social security costs
849
564
Other pension costs
63
31
Equity settled share based payment expense
104
195
10,795
8,310

The average number of persons, including directors, employed by the Group during the period was 642, of which634 were restaurant staff and 8 were administration staff, (2013 - 506 of which 498 were restaurant staff and 8 were administration staff).
Of the total staff costs 10,099,000 was classified as cost of sales (2013 - 7,566,000) and 788,000 as administrative expenses (2013 - 744,000).
6 Income tax expense
2014
2013
'000
'000
UK Corporation tax
Current tax on profits for the period
-
-
Total current tax
-
-
Deferred tax
Utilisation of tax losses
(282)
(173)
Origination and reversal of temporary differences
(218)
(127)
Impact of change in future rate of taxation
-
-
Total deferred tax
(500)
(300)
Total income tax charge
(500)
(300)
The tax charge for the period is lower than the standard rate of corporation tax in the UK. The differences are explained below:
2014
2013
'000
'000
Profit before tax
2,552
1,742
Tax on profit at the ordinary rate of corporation
tax in UK of 21.5% (2013 - 23.25%)
549
405
Effects of
Expenses not deductible for tax
8
8
Depreciation on ineligible fixed assets
63
63
Utilisation of tax losses
(120)
(176)
Total tax charge
500
300
7 Earnings per share
2014
2013
pence
Pence
Basic earnings per ordinary share
3.88
2.95
Diluted earnings per ordinary share
3.83
2.90
2014
2013
Number '000
Number '000
Earnings per share have been calculated using the numbers shown below:
Weighted average ordinary shares (basic)
52,954
48,896
Weighted average ordinary shares (diluted)
53,616
49,734
2014
2013
'000
'000
Profit for the financial period
2,052
1,442
1,071,888 share options have been used when calculating the diluted EPS (2013 - 1,498,992). 2,021,785 share options have been excluded when calculating the diluted EPS as they were anti-dilutive (2013 - 95,000).
8 Dividend
No final dividend has been proposed by the Directors (2013 - nil).
9 Intangibles
Trademarks
Goodwill
Total
'000
'000
'000
At 30 December 2012
7
441
448
Amortisation of trademarks
(2)
-
(2)
At 29 December 2013
5
441
446
Amortisation of trademarks
(2)
-
(2)
At 28 December 2014
3
441
444


The recoverable amount of goodwill has been determined on a value in use basis. This has been based on the performance of the units since they were acquired and management's forecasts, which assume the sites will perform at least as well as the market generally. The forecast cash flows are discounted at a rate of 10%.
10 Property, plant and equipment
Leasehold improvements
Furniture fixtures and computer equipment
Assets in the course of construction
Total
'000
'000
'000
'000
Cost
At 30 December 2012
11,777
4,363
136
16,276
Additions 
3,299
1,161
323
4,783
Disposals
(37)
(142)
(25)
(204)
Transfers
89
47
(136)
-
At 29 December 2013
15,128
5,429
298
20,855
Additions
4,736
1,462
180
6,378
Disposals
(120)
(11)
-
(131)
Transfers
197
85
(282)
-
At 28 December 2014
19,941
6,965
196
27,102
Depreciation
At 30 December 2012
2,902
1,583
-
4,485
Provided for the period
618
504
-
1,122
Disposals
(37)
(84)
(121)
Impairment reversal
(15)
-
-
(15)
At 29 December 2013
3,468
2,003
-
5,471
Provided for the period
748
562
-
1,310
Disposals
(62)
(8)
-
(70)
At 28 December 2014
4,154
2,557
-
6,711
Net book value
At 28 December 2014
15,787
4,408
196
20,391
At 29 December 2013
11,660
3,426
298
15,384
11 Prepaid operating leases
2014
2013
'000
'000
Held within current assets
152
152
Held within non-current assets
1,731
1,895
1,883
2,047

Prepaid operating leases represent lease premiums paid on the acquisition of sites, amortised evenly over the lease term.
12 Inventories
2014
2013
'000
'000
Raw materials and consumables
531
389
Crockery and utensils
520
422
1,051
811

In the Directors' opinion there is no material difference between the replacement cost of stocks and the amounts stated above. Inventory purchased and recognised as an expense in the period is 7,145,000 (2013 - 5,242,000).
13 Trade and other receivables
2014
2013
'000
'000
Group
Trade receivables
353
170
Prepayments and other receivables
1,789
1,561
Total trade and other receivables
2,142
1,731
Less non-current portion
(341)
(381)
1,801
1,350
14 Trade and other payables
2014
2013
'000
'000
Trade payables
3,422
2,178
Taxation and social security
957
724
Accruals
1,803
1,845
Other payables
354
262
6,536
5,009
15 Provisions
2014
2013
'000
'000
At 29 December 2013
65
75
Utilisation in period
(10)
(10)
At 28 December 2014
55
65
16 Deferred tax
2014
2013
'000
'000
At 29 December 2013
(115)
185
Profit and loss charge
(500)
(300)
(615)
(115)
Accelerated capital allowances
(766)
(551)
Tax losses carried forward
151
436
At 28 December 2014
(615)
(115)
                                                          
17 Borrowings
2014
2013
'000
'000
Current
Secured bank borrowings
500
250
500
250
Non-current
Secured bank borrowings
250
750
250
750
750
1,000
Maturity of secured bank borrowings
Due within one year
500
250
Due In more than one year but less than two years
250
500
Due In more than two years but less than five years
-
250
750
1,000

Bank borrowings comprise of a term loan. The Group has an additional committed facility of 3,000,000 of which nil was drawn down at the balance sheet date. There were no instances of default, including covenant terms, in either the current or prior period.
18 Share capital
Number
'000
Authorised, issued, called up and fully paid:
At 30 December 2012
47,902,949
4,790
Exercise of share options
2,514,152
252
Share placement
2,510,000
251
At 29 December 2013
52,927,101
5,293
Exercise of share options
121,335
12
Share placement
-
-
At 28 December 2014
53,048,436
5,305

19 Reserves
Share capital comprises of the nominal value of the issued shares.
Share premium reserve is the amount subscribed in excess of the nominal value of shares net of issue costs.
Cumulative gains and losses recognised in the income statement are shown in the Retained deficit reserves, together with other items taken direct to equity.
The merger reserve is the difference between the nominal value of shares issued and the nominal value of shares acquired on merger.
20 Capital commitments
At the balance sheet date the Group and the Company had no capital commitments which were contracted but not provided for (2013 - nil). Capital commitments relate to committed expenditure in respect of restaurants under construction.
21 Operating lease commitments
The total future value of minimum lease payments under non-cancellable operating leases are shown below. The receipts are from sub-tenants on contractual sub-leases, the net position represents the cash liability of the Group.
2014
2013
'000
'000
Within one year: payments
3,016
2,756
Within one year: receipts
(230)
(230)
2,786
2,526
Within two to five years: payments
12,663
10,953
Within two to five years: receipts
(920)
(920)
11,743
10,033
Over five years: payments
40,759
31,500
Over five years: receipts
(4,086)
(4,086)
36,673
27,414
51,202
39,973
22 Pensions
The Group, last year, made contributions of nil to the personal pension plan of the Directors. The total amount paid during the period was nil. During the year the Group made contributions to employee pensions of 63,000 (2013 - 31,000).
23 Share based payments
Weighted average exercise price 
Number
(pence)
'000
At 30 December 2012
44.2
4,108
Exercised 
44.6
(2,514)
At 29 December 2013
44.2
1,594
Exercised / cancelled
26.9
(522)
Granted
101.4
2,042
At 28 December 2014
80.6
3,114
The exercise price of options outstanding at the end of the period ranged between 18p and 112p (2013 - 18p and 87.5p) and their weighted average remaining contractual life was 8 years (2013 - 4 years).
Of the total number of options outstanding at the end of period 1,071,888 (2013 - 1,593,992) had vested and were exercisable at the end of the period.
The market price of the Company's ordinary shares as at 28 December 2014 was 112p and the range during the financial year was from 89p to 125p.
On 11 October 2013 the Company's subsidiary issued 1,800,000 'A' ordinary shares of 0.0001 each that carry rights enabling the holder of those 'A' ordinary shares to exchange such shares for ordinary shares in the Company subject to the share price of the Company remaining at or above 1.50 for fifteen consecutive days. 'A' ordinary shares convey similar rights to the holder as EMI options with an exercise price of 1.00 and have been valued as a share based payment with conditional performance options.
On 27 February 2014 the Company established a Company Share Option Plan ("CSOP") and issued 221,785 CSOP options with an exercise price of 112p and vesting period of 3 years.
In the current period 121,335 (2013 - 2,514,152) options were exercised. The weighted average share price at the date of exercise was 26.9p (2013 - 100p)

This information is provided by RNS
The company news service from the London Stock Exchange
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