RNS Number:0923G
Capital Bars PLC
29 June 2001


EMBARGOED UNTIL 7.30AM

29th JUNE, 2001



                               CAPITAL BARS PLC

            INTERIM RESULTS FOR THE SIX MONTHS ENDING 1 APRIL 2001


Chairman's Statement

Introduction

I am pleased to report our results for the first six months of our financial
year ending 30 September 2001, our first period since the disposal of our UK
operations. Our principal operating currency is now the Irish pound, which
will be replaced by the Euro on 1 January 2002. Accordingly our interim
results have been produced in Euros.

Turnover from continuing operations has increased by 34%, reflecting the
contribution from our new openings in 2000, although like for like turnover in
the period was down 3%, in line with our trading statement in January 2001.
Group profit before tax was Euro0.5m, a significant improvement on the loss of
Euro1.4m recorded in the 6 months to 2 April 2000. Operating profits from
continuing operations, after goodwill, were up Euro0.3m at Euro0.9m. Our unit
EBITDA (earnings before interest, tax, depreciation and amortisation) margin,
excluding the loss incurred at Planet Hollywood, was 16.6%, in line with 17.5%
in the comparative period.

It has been well reported that our particular industry in Ireland has faced a
difficult trading environment in recent months. We have had to contend with
Irish Government restrictions on our pricing and admissions policies, limiting
our ability to offset the unprecedented wage inflation suffered in 2000. We
have also faced increased competition after the relaxation of trading hours in
Dublin, heightened transport difficulties (taxi drivers' and Aer Lingus
strikes) for our customers and the foot and mouth crisis - all within the
context of a weaker global economy reduced consumer confidence..

Against this background, I believe that our results are very creditable.
Turnover from continuing operations has increased by 34%, reflecting the
contribution from our new openings in 2000, although like for like turnover in
the period was down 3%, in line with our trading statement in January 2001.
Group profit before tax was Euro0.5m, a significant improvement on the loss of
Euro1.1m recorded in the 6 months to 2 April 2000. Operating profits from
continuing operations, after goodwill, were up Euro0.3m at Euro0.9m. Our unit
EBITDA (earnings before interest, tax depreciation and amortisation) margin,
excluding Planet Hollywood, was 16.7%, in line with 17.5% in the comparative
period.

Unit performance

Our new openings (Fireworks, Bobs Bar, Coyote Lounge and the Trinity Capital
Hotel) have all performed well in the period; contributing Euro5.0m to group
turnover and Euro0.7m to group EBITDA. We are particularly pleased with this
performance in the context of the 'Equal Status Act', which has applied since
January 2001. The Act prevents us from being selective as to our clientele and
therefore places some limits on our ability to manage the atmosphere in our
units.

I explained in January that we had seen a downturn in trade in Major Toms as a
result of increased competition following the relaxation of trading hours and
a number of new openings in Dublin. We have now rethemed Major Toms as 'Major
Toms Down Under', Dublin's first Australian theme bar. Initial trading is very
encouraging. Mount Street has also suffered as a result of these issues. We
are reviewing our offering at this unit.

Planet Hollywood, which we acquired in September 2000, incurred a loss of Euro
0.3m in the period; broadly in line with our expectations. We hope to be able
to report progress on a new theme for this unit later this year.

Our remaining business has, in total, maintained historic trading levels.
Zanzibar in particular has performed very well, and we have seen improvements
at Savannah as a result of the refurbishment. Combined room revenue at the
Grafton Capital and Rathmines Capital hotels were down 5% on the prior year,
largely as a result of the factors foot and mouth crisis and industrial action
referred to above.

Financing

Due to limitations on our distributable reserves we are unable to complete the
redemption of our preference shares on 1 July 2001. We will be redeeming Stg#
1m of the preference shares on the due date. Liam and Des O'Dwyer have agreed
to buy the remaining Stg#2m of preference shares and have agreed to defer
redemption until (at least 1 July 2002). We will be redeeming approximately
Stg#1.7m of the preference shares on 1 July 2001, the maximum amount our
distributable reserves will allow. The balance of Stg#1.3m preference shares
will be redeemed as further distributable profits arise. The terms of the
deferred redemption are currently in the course of negotiation with our
preference shareholders.

In view of our continuing investment in development, and partial preference
share redemption on 1 July this year, we do not propose to declare an interim
or final dividend in this financial year.

The conditions necessary for the issue of the shares in respect of the
acquisitions made in October 1999 have now progressed and we expect to issue
the acquisition shares in July this year.

New Openings

We are now in the final phase of our Dublin development plan. Sosueme, a 1,000
plus capacity Japanese-style bar, on Georges Street, Dublin opened on 2 June
2001. Sosume has now traded for three weeks, with turnover now very close to
our target for the unit. This will be followed by the greatly enlarged Cafe en
Seine towards the end of this year and the re-theming and redevelopment of the
Planet Hollywood unit in 2002.

People

I announced on 7 June 2001 that Roger Beaumont had resigned as a director of
the company to pursue other business interests. Roger has made an enormous
contribution to the company and we wish him well in the future.

Prospects

Like for like sales since 1 April 2001 are in line with last year, total sales
being 32% ahead. Our business however remains sensitive not only to the
broader consumer economy but also, as we have seen over the past year,
Government intervention. These factors have continued to place pressure on our
business and accordingly we have had to downgrade our results expectation for
the year to 30 September 2001.

However, the expected return of reasonable stability to our marketplace and
the completion of our openings programme as outlined above should enable the
company to begin to realise its full potential.

Robert Gunlack

Chairman

29 June 2001



Enquiries:

Liam O'Dwyer, Chief Executive             Tel: + 353 1 648 1200

Hugh Doherty, Financial Director          Tel: + 353 1 648 1200

Caroline Moody, Grayling Gilmore          Tel: + 353 1 283 0088





GROUP PROFIT AND LOSS ACCOUNT

For the six months ended 1 April 2001 (unaudited)

                                              6 months    6 months    18 months
                                                 ended       ended        ended
                                               1 April     2 April    2 October
                                                  2001        2000         2000
                                              Euro000s    Euro000s     Euro000s
Turnover

Continuing operation                            21,469      16,028       40,977
Discontinued operations                              -       6,476       17,507
Group turnover                                  21,469      22,504       58,484
Cost of sales                                  (5,904)     (6,417)     (16,386)
Gross profit                                    15,565      16,087       42,098

Administrative expenses                       (14,377)    (15,464)     (42,001)
Goodwill amortisation                            (297)       (176)        (406)
Provision for loss on sale of UK business            -     (1,640)            -
Severance costs                                      -           -        (292)
Total administrative expenses                 (14,674)    (17,280)     (42,699)

Operating profit/(loss)
Continuing operations                              891         644        2,159
Discontinued operations                              -     (1,837)      (2,760)

Total operating profit/(loss)                      891     (1,193)        (601)
Loss on sale of discontinued operations              -           -      (1,676)

Interest receivable                                  -          50           81
Interest payable                                 (406)       (299)        (716)

Profit/(loss) on ordinary activities               485     (1,442)      (2,912)
before taxation
Taxation (note 2)                                 (98)       (125)        (122)
Profit/(loss) on ordinary activities after         387     (1,567)      (3,034)
taxation

Dividends
- preference                                     (212)       (209)        (625)
- ordinary                                           -           -        (373)
Other appropriations - non equity shares             -         (7)         (19)
Retained profit/(loss) for the financial           175     (1,783)      (4,051)
period

Earnings/(loss) per share (note 3)
Basic                                             0.5c      (5.3)c      (11.0)c
Diluted                                           0.5c      (5.3)c      (10.5)c





GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES

For the six months ending 1 April 2001 (unaudited)

                                                  6 months  6 months  18 months
                                                     ended     ended      ended
                                                   1 April   2 April  2 October
                                                      2001      2000       2000

                                                  Euro000s  Euro000s   Euro000s

Profit/(loss) attributable to members of the           387   (1,567)    (3,034)
parent company
Exchange difference on retranslation of net              5     (584)      (837)
assets of subsidiary undertaking
Total recognised gains/(losses) related to the         392   (2,151)    (3,871)
period
Prior period adjustment                                                   (851)
Total gains and losses recognised since last                            (4,722)
annual report





GROUP BALANCE SHEET

At 1 April 2001 (unaudited)

                                                 1 April    2 April   2 October
                                                    2001       2000        2000
                                                Euro000s   Euro000s    Euro000s

Fixed assets
Intangible assets                                 19,715     21,905      20,013
Tangible assets                                   21,529     15,630      14,683
                                                  41,244     37,535      34,696
Current assets
Stocks                                               590        665         500
Debtors and prepayments                            2,483      3,003       2,639
Cash at bank and in hand                              18      2,348       7,723
                                                   3,091      6,016      10,862

Creditors: amounts falling due within one
year
Bank overdrafts, finance leases and hire         (1,446)    (1,085)     (2,820)
purchase
Trade creditors                                  (2,180)    (2,841)     (3,084)
Other creditors                                  (3,912)    (3,464)     (5,466)
                                                 (7,538)    (7,390)    (11,370)

Net current liabilities                          (4,447)    (1,374)       (508)

Total assets less current liabilities             36,797     36,161      34,188

Creditors: amounts falling due after more       (10,486)    (7,176)     (8,277)
than one year

Provision for liabilities and charges               (69)      (333)        (69)

NET ASSETS                                        26,242     28,652      25,842

Capital and reserves
Ordinary share capital                             5,623      5,623       5,623
Preference share capital                           5,026      5,026       5,026
Share premium                                     11,039     11,039      11,039
Share to be issued                                13,089     12,868      12,868
Revaluation reserve                                1,478      1,478       1,478
Merger reserve                                     3,004      3,004       3,004
Profit and loss account (note 4)                (13,017)   (10,386)    (13,196)
SHAREHOLDERS' FUNDS                               26,242     28,652      25,842





GROUP STATEMENT OF CASH FLOWS

For the six months ended 1 April 2001 (unaudited)

                                                 6 months  6 months  18 months
                                                    ended     ended      ended
                                                  1 April   2 April  2 October
                                                     2001      2000       2000

                                                 Euro000s  Euro000s   Euro000s

Net cash (outflow) / inflow from operating          (658)     3,550      4,392
activities
Net cash outflow from returns on investments        (619)     (531)    (1,292)
and servicing of finance
Tax paid                                                -      (19)      (503)
Capital expenditure and financial investment      (7,263)   (1,124)    (7,650)
Acquisitions and disposals                              -   (9,190)    (2,933)
Equity dividends paid                                   -   (1,055)    (1,438)
Net cash outflow before financing                 (8,540)   (8,369)    (9,424)

Financing
Increase in debt and lease financing                  836     6,101      7,459
Net cash inflow from financing                        836     6,101      7,459
Decrease in cash                                  (7,704)   (2,268)    (1,965)

Reconciliation of operating profit / (loss) to net cash (outflow) / inflow
from operating activities
Operating profit/ (loss)                              891   (1,193)      (601)
Depreciation and amortisation                         714       839      2,134
Loss on disposal of tangible fixed assets               -        87         49
Provision for loss on sale of UK business               -     1,640          -
LTIP charges                                          221       312        441
Increase in stocks                                   (90)     (175)      (179)
Decrease in debtors                                   157     1,007        419
(Decrease)/increase in creditors                  (2,551)     1,033      2,446
Decrease in provisions                                            -      (317)
Net cash (outflow) / inflow from operating          (658)     3,550      4,392
activities

Reconciliation of net cash flow to movements in (debt)/funds
Decrease in cash in the period                    (7,704)   (2,268)    (1,965)
Cash inflow from changes in debt and lease          (836)   (6,101)    (7,459)
financing
Movement in net debt resulting from cash flows    (8,540)   (8,369)    (9,424)
Loans acquired with subsidiary                          -     (250)      (303)
Exchange movements                                      -     (101)      (618)
Net (debt)/funds at start of period               (3,374)     3,042      6,971
Net debt at period end                           (11,914)   (5,678)    (3,374)



NOTES TO THE ACCOUNTS

For the six months ended 1 April 2001 (unaudited)



 1. PREPARATION OF INTERIM FINANCIAL STATEMENTS

    The interim financial information has been prepared on a basis consistent
    with accounting policies disclosed in the statutory accounts of the Group
    for the period ended 2 October 2000.

    The consolidated results for the period ended 2 October 2000 have been
    extracted from the accounts of Capital Bars Plc for that period, and do
    not constitute the full statutory accounts of Capital Bars Plc. The
    accounts for the year dated 2 October 2000 received an unqualified audit
    report and have been filed with the Registrar of Companies.

    Continuing operations comprises the group's operation of licensed
    restaurants, bars and hotels in the Republic of Ireland. Discontinued
    operations comprise the licensed restaurant interests in the United
    Kingdom.



 2. TAXATION

    The taxation charge has been calculated by applying the estimated
    effective rate for the year against reported profits.



 3. EARNINGS / (LOSS) PER SHARE

    Earnings / (loss) per share have been calculated as follows:

                             6 months ended      6 months ended     18 months   
                                                                        ended
                                    1 April             2 April     2 October
                                       2001                2000          2000

    Profit / (loss) for         Euro387,000     Euro(1,567,000) Euro(3,034,000)
    the period
    Preference                Euro(212,000)       Euro(209,000)   Euro(625,000)
    dividends
    Non-equity                            -         Euro(7,000)    Euro(19,000)
    appropriations
    Basis earnings /            Euro175,000     Euro(1,783,000) Euro(3,678,000)
    (loss)
    Average shares in            33,562,749          33,562,749     33,562,749
    issue - basic
    Basis earnings /                   0.5c              (5.3)c        (11.0)c
    (loss) per share
    Diluted earnings /          Euro175,000     Euro(1,783,000) Euro(3,678,000)
    (loss)
    Average shares in            33,562,749          33,562,749     33,562,749
    issue - basic

    Dilutive potential
    ordinary shares:
                                                           
            Employee              2,200,000                   -      1,388,342
            share                         
            options

            Warrants                      -                   -              -  


    Average shares in            35,762,749          33,562,749     34,951,091
    issue - diluted
    Diluted earnings /                 0.5c              (5.3)c        (10.5)c
    (loss) per share


    The weighted average number of ordinary shares for the purpose of
    calculating the diluted earnings / (loss) per ordinary share includes
    options under employee share schemes as these are dilutive in respect of
    the net profit per share on continuing operations as defined by FRS 14.



4. PROFIT AND LOSS ACCOUNT


   Included in the profit and loss account is goodwill written-off of           
   Euro11.9m.


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