RNS Number:7925X
Capital Bars PLC
25 January 2001
CAPITAL BARS PLC
PRELIMINARY ANNOUNCEMENT FOR THE 18 MONTHS ENDED 2 OCTOBER 2000
CHAIRMAN'S STATEMENT
INTRODUCTION
Your company has been radically transformed in the eighteen month period to
2 October 2000. Key actions which have taken place since the company's last
year end have been as follows:
* Implementation of the company's new strategy of focusing on its Dublin
businesses;
* Doubling the size of the business through the acquisition of certain
leading bar, restaurant and hotel venues in Dublin ('the O'Dwyer
acquisition');
* Acquisition of Planet Hollywood in Dublin;
* Disposal of the UK businesses;
* Strengthening of the Board;
* Changing the name of the company to Capital Bars plc; and
* Gaining a secondary listing on the Irish Stock Exchange.
We now operate 11 major bar/restaurants and 3 hotels in Dublin, with the greatly
enlarged Cafe en Seine and a further substantial Dublin bar/restaurant to open
later this year.
ACQUISITIONS IN THE PERIOD
The O'Dwyer acquisition was completed in October 1999 and comprised 5
established trading units (Zanzibar, The George, Rathmines Capital Hotel,
Savannah Bar and O'Dwyers Mount St) and 3 units under development/refurbishment,
which have opened in the period (Trinity Capital Hotel, Fireworks and Bobs Bar).
The consideration for the acquisition was cash of Stg#4.4m and 23.5m shares to
be issued. As at the current date certain of the conditions relating to the
property and licence interest are still in the process of being satisfied and
accordingly the consideration shares have not been issued. It is expected that
the shares will be issued by 30 June 2001.
We will also shortly complete the acquisition of two further units (Coyote
Lounge, which opened in October 2000, and Sosume, currently in the course of
development), over which the Company had option arrangements as part of the
O'Dwyer acquisition.
All the bar/restaurants acquired have capacities in excess of 1000 people and
are situated in Dublin City. The two hotels acquired have a total of 129 rooms
and again are situated in central locations.
In August 2000 we completed the acquisition of Planet Hollywood, situated in a
prime site on St Stephens Green in Dublin, for a cash consideration of IR#1.35m.
In the short term we will continue to trade the unit as Planet Hollywood under a
licence agreement.
The acquisitions in the period have enabled us to enhance significantly our
Dublin presence, where we have an established and proven track record.
DISPOSAL OF THE UK BUSINESS
In January 2000 I reported that your Board believed that shareholder value would
be greatly enhanced by concentration on our successful Dublin operation. In
accordance with this strategy, we completed the disposal of our UK
bar/restaurant division on 2 October 2000 for a cash consideration of Stg#4.7m.
The loss on disposal of this business of Stg#1.1m was consistent with the
provision we made in our interim results to March 2000.
The UK bar/restaurant division comprised four Break for the Border
bar/restaurants in London, Leeds and Peterborough, the Cafe en Seine in
Peterborough, the Borderline live music venue in London and an agreement to
lease a site in Cardiff.
In immediate terms, this disposal has eliminated our exposure to the losses
arising from the UK bar/restaurant division, which totalled Stg#1.7m in the
eighteen month period to 2 October 2000.
BOARD CHANGES
The Board has been strengthened considerably during the period.
Liam O'Dwyer has been appointed Chief Executive, with particular responsibility
for design and development of new units. Roger Beaumont continues as Group
Managing Director, with overall responsibility for management and operations.
Hugh Doherty and Aidan Corcoran have joined as Finance Director and Commercial
Director respectively. Robert Breare joined us in November 1999 as a non-
executive director.
RESULTS FOR THE PERIOD
Operating profit from continuing operations (before goodwill) in the current
eighteen month period was Stg#1.62m against Stg#1.61m in the prior year.
Our results in the latter part of the period have been significantly affected by
a number of abnormal issues, most of which I am pleased to say are now behind
us. In addition to certain rent reviews and the increased strength of Sterling
against the Irish Pound which I reported on in July, we have had to absorb very
substantial wage increases in line with our trade association's recommendations.
The simultaneous imposition of a price freeze on the core products of the
licensed trade by the Irish government in July 2000 prevented the company from
countering these increased costs by appropriate price increases. Also in July
2000 Cafe en Seine, one of the core earners for the company, was closed for a
major expansion and refurbishment.
Results have also been affected by the pre-opening costs and start-up losses of
new units, which are a necessary investment in the growth of the company and
increased long-term profitability.
However I am pleased to say that the price freeze was lifted on 15 January 2001
and the company is now able to increase its prices, and we are confident that
this will not decrease volumes. The company's dramatic development programme
over the last year is substantially complete with all its substantial assets
apart from Cafe en Seine and Sosume now trading.
At an individual trading unit level, we have been particularly pleased with the
performance of the new openings. Sales at Fireworks and Trinity Capital Hotel
have been significantly ahead of our expectations. Bobs Bar and Coyote have
both achieved their target sales level and should also produce healthy returns.
Most importantly, we have not seen any great 'cannibalisation' of our existing
trade as a result of the new openings.
The refurbishment of the front bar in Savannah in early 2000 was successful in
its aim of increasing early evening trade in the unit. Following this success,
we have now refurbished the rear nightclub area, which reopened just before
Christmas. Initial sales following this extended refurbishment are encouraging.
Sales at Major Toms have been hit by a change in licensing hours in Dublin,
together with a number of competitor openings in its immediate vicinity. We are
exploring a number of opportunities for this unit.
Operating losses from our UK businesses were Stg#1.74m, leading to the group
operating loss for the period of Stg#0.38m. The loss retained for the period,
after taking account of the loss on disposal of the UK business, interest,
taxation and dividends paid was Stg#2.55m.
DIVIDENDS
In view of results for the period, the substantial investment required for our
Dublin opening programme, together with adverse taxation and currency factors,
we do not propose to declare a final dividend for the period to 2 October 2000.
We will review the reintroduction of dividend payments as soon as it is
appropriate to do so.
NET ASSETS AND FUNDING
Group net assets increased from Stg#10.8m to Stg#15.4m at the period end, this
is principally as a result of the acquisitions made in the period. We invested
Stg#4.9m in our leasehold premises, of which the majority was spent on the
acquisition of Planet Hollywood and the three units under development during the
period - the extension to Cafe en Seine, Coyote Lounge and Sosume.
Net debt at the period end was Stg#2.0m - Stg#5.0m after taking account of the
preference shares that are due for redemption in July 2001. Following the sale
of the UK bar/restaurant business we have repaid our Sterling denominated
borrowings and replaced our remaining bank debt with a new IR#14m facility.
This will provide necessary funds for the foreseeable future.
ACCOUNTING POLICIES
Following the introduction of FRS15, Tangible Fixed Assets, in February 1999 the
Board has reassessed accounting policies in this area. We reported in January
2000 that we had changed our policies to be more financially prudent in respect
of pre-opening costs and the method of depreciating licensed leasehold premises.
Pre-opening costs were previously capitalised and amortised over 30 months,
commencing six months after the opening of the venue. With effect from 5 April
1999, pre-opening expenses have been written-off as incurred. Pre-opening
expenses of Stg#0.2m associated with our openings in the period have been
charged against profits for the period.
Licensed leasehold premises were previously depreciated over their useful lives
using the annuity method. Depreciation is now being calculated using a straight
line basis. The additional depreciation charge arising as a result of this
change was Stg#0.1m in the period.
The group's principal operating currency is now the Irish Pound. In order to
improve the comparability of the group's results, the Irish Pound will be
adopted as the reporting currency for future interim and annual reports.
CURRENT TRADING
Total continuing gross sales increased by 36% in the 13 weeks from 2 October
2000 to 31 December 2000, with strong performances from Fireworks, Trinity
Capital and Bobs Bar. Against heightened competition we maintained like for
like sales in the period, excluding Major Toms which has experienced a downturn
in trade as referred to above. Including Major Toms, like for like sales were
down 3%.
Great credit must be given to all our staff for their hard work throughout this
period.
PROSPECTS
We look forward to the opening of Sosume and the extended Cafe en Seine later
this year with great confidence, following the success of our new openings
during this reporting period.
This will mark the moment when the company will move from its recent development
phase to concentrate on earnings growth, exploiting its now leading position in
the Dublin leisure market.
Robert Gunlack
Chairman
25 January 2001
Enquiries:
Liam O'Dwyer, Chief Executive Tel: + 3531 648 1200
Roger Beaumont, Managing Director Tel: + 3531 648 1200
Hugh Doherty, Finance Director Tel: + 3531 648 1200
Caroline Moody, Grayling Gilmore Tel: + 3531 283 0088
GROUP PROFIT AND LOSS ACCOUNT
for the eighteen months ended 2 October 2000
18 18
months months
ended ended 12
2 2 months
October Excepti October ended
2000 onal 2000 4
before items/ after April
excepti goodwill excepti 1999
onals/ onals/ restated
goodwill goodwill
Stg#000 Stg#000 Stg#000 Stg#000
TURNOVER
Continuing operations
Ongoing 15,330 - 15,330 10,905
Acquisitions 10,488 - 10,488 -
Continuing operations - total 25,818 - 25,818 10,905
Discontinued operations 11,030 - 11,030 10,112
Group turnover 36,848 - 36,848 21,017
Cost of sales (10,324) - (10,324) (5,210)
Gross profit 26,524 - 26,524 15,807
Administrative expenses (26,463) (440) (26,903)(14,983)
OPERATING PROFIT/(LOSS)
Ongoing operations 1,502 - 1,502 1,610
Acquisitions 114 (256) (142) -
Continuing operations 1,616 (256) 1,360 1,610
Discontinued operations (1,555) (184) (1,739) (786)
Total operating (loss)/profit 61 (440) (379) 824
(Loss)/profit on sale of
discontinued (1,056) 92
operations
(1,435) 916
Interest receivable 51 195
Interest payable and similar charges (451) (318)
(Loss)/profit on ordinary activities
before (1,835) 793
taxation
Taxation (77) (377)
(Loss)/profit attributable to
members of the (1,912) 416
parent company
Dividends
- Preference (394) (262)
- Ordinary (235) (671)
Other appropriations - non equity (12) (12)
shares
Retained loss for the financial (2,553) (529)
period
(Loss)/earnings per share basic (7.00)p 0.42p
diluted (6.63)p 0.42p
Note: The results for the 12 months ended 4 April 1999 have been restated to
reflect changes in the accounting policy for pre-opening expenses.
GROUP BALANCE SHEET
at 2 October 2000
4 April
2 1999
October restated
2000
Stg#000 Stg#000
FIXED ASSETS
Intangible assets 11,945 6
Tangible assets 8,764 9,091
20,709 9,097
CURRENT ASSETS
Stocks 299 293
Debtors 1,574 1,782
Cash at bank and in hand 4,610 5,625
6,483 7,700
CREDITORS: amounts falling due (6,786) (4,739)
within one year
NET CURRENT (LIABILITIES)/ASSETS (303) 2,961
TOTAL ASSETS LESS CURRENT 20,406 12,058
LIABILITIES
CREDITORS: amounts falling due after (4,940) (1,046)
more than one year
PROVISIONS FOR LIABILITIES AND (41) (200)
CHARGES
15,425 10,812
CAPITAL AND RESERVES
Called up share capital 6,356 6,356
Share premium 6,589 6,589
Shares to be issued 7,681 -
Revaluation reserve 882 993
Merger reserve 1,793 1,793
Profit and loss account (7,876) (4,919)
Shareholders' funds:
Equity 12,437 7,836
Non-equity 2,988 2,976
Total 15,425 10,812
Note: The results for the 12 months ended 4 April 1999 have been restated to
reflect changes in the accounting policy for pre-opening expenses.
GROUP STATEMENT OF CASH FLOWS
for the eighteen months ended 2 October 2000
12
18 months
months ended
ended 4 April
2 1999
October restated
2000
Stg#000 Stg#000
Net cash inflow from operating 2,767 3,418
activities
Returns on investments and servicing (814) (365)
of finance
Taxation (317) (506)
Capital expenditure (4,820) (3,436)
Acquisitions and disposals (1,848) 1,246
Equity dividends paid (906) (436)
Net cash outflow before financing (5,938) (79)
Financing:
Increase/(decrease) in debt and 4,700 (334)
lease financing
Decrease in cash during the period (1,238) (413)
RECONCILIATION OF NET CASH FLOW TO MOVEMENT 18 12
IN NET (DEBT)/FUNDS months months
ended ended
2 4 April
October 1999
2000 Stg#000
Stg#000
Decrease in cash in the period (1,238) (413)
Net cash (inflow)/outflow from (4,700) 334
movement in debt and lease financing
Change in net funds resulting from (5,938) (79)
cash flows
Exchange movements (180) (103)
Other movements (95) -
Loans acquired with subsidiary (191) -
Loans disposed of with subsidiary - 1,716
Movement in net funds in the period (6,404) 1,534
Net funds as at 4 April 1999 4,392 2,858
Net (debt)/funds as at 2 October (2,012) 4,392
2000
GROUP STATEMENT OF CASH FLOWS
for the eighteen months ended 2 October 2000
RECONCILIATION OF OPERATING (LOSS)/PROFIT TO NET CASH INFLOW FROM OPERATING
ACTIVITIES
12
18 months
months ended
ended 4 April
2 1999
October restated
2000
Stg#000 Stg#000
Operating (loss)/profit (379) 824
Depreciation and amortisation 1,345 526
Loss on disposal of tangible fixed 31 35
assets
Long term incentive scheme charges 278 -
(Increase)/decrease in stocks (113) 442
Decrease/(increase) in debtors 264 (238)
Increase in creditors 1,541 1,629
(Decrease)/increase in provisions (200) 200
Net cash inflow from operating 2,767 3,418
activities
ANALYSIS OF NET FUNDS/DEBT
At At
4 April Exchange Other 2 October
1999 Cashflow Acquisitions movements movements 2000
Stg#000 Stg#000 Stg#000 Stg#000 Stg#000 Stg#000
Cash at bank 5,625 (759) - (256) - 4,610
and in hand
Overdrafts - (479) - - - (479)
5,625 (1,238) - (256) - 4,131
Debt due (190) (826) (64) - - (1,080)
within one
year
Debt due after (364) (4,007) (127) - - (4,498)
one year
Finance leases (679) 133 - 76 (95) (565)
(1,233) (4,700) (191) 76 (95) (6,143)
Net 4,392 (5,938) (191) (180) (95) (2,012)
funds/(debt)
GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the eighteen months ended 2 October 2000
12
18 months
months ended
ended 4 April
2 1999
October restated
2000
Stg#000 Stg#000
(Loss)/profit attributable to (1,912) 416
members of the parent company
Exchange difference on retranslation of net (527) 143
assets of subsidiary undertakings
Total recognised (losses)/gains (2,439) 559
relating to the period
Prior period adjustment (536)
Total losses recognised since last (2,975)
annual report
NOTES TO THE ACCOUNTS
FOR THE EIGHTEEN MONTHS ENDED 2 OCTOBER 2000
1. PREPARATION OF PRELIMINARY ANNOUNCEMENT
The preliminary announcement has been prepared on a basis consistent with
accounting policies disclosed in the statutory accounts of the Group for the 18
months ended 2 October 2000. The Annual Report and Accounts will be sent to
shareholders in early February 2001.
The consolidated results for the 18 months ended 2 October 2000 and for the 12
months ended 4 April 1999 have, subject to the adjustments for changes in
accounting policies relating to preopening costs referred to below, been
extracted from the accounts of Capital Bars Plc (formerly Break for the Border
Group Plc) for those periods, and do not constitute the full statutory accounts
of Capital Bars Plc. The accounts for the 12 months ended 4 April 1999 received
an unqualified audit report and have been filed with the Registrar of Companies.
The accounts for the 18 months ended 2 October 2000 received an unqualified
audit report and are to be filed with the Registrar of Companies.
2. SEGMENTAL ANALYSIS
Turnover and operating profit are analysed by geographical area as follows:
12
18 months
months ended
ended 4 April
2 1999
October Operating
2000 profit/
Operating loss
profit/ restated
Turnover (loss) Turnover
Stg#000 Stg#000 Stg#000 Stg#000
Continuing operations:
Republic of Ireland 25,818 1,360 10,905 1,610
Discontinued operations:
United Kingdom 11,030 (1,739) 7,410 (1,200)
Republic of Ireland - - 2,702 414
11,030 (1,739) 10,112 (786)
36,848 (379) 21,017 824
Turnover from continuing operations represents amounts derived from the group's
continuing principal activities as an operator of licensed restaurants, bars and
hotels in the Republic of Ireland stated net of value added tax. All turnover
is derived from external customers and there is no difference between turnover
by source and destination.
During the period, the group operated in two geographical markets, the United
Kingdom and the Republic of Ireland.
The discontinued operations in the current period comprise the UK bar/restaurant
division and, in the prior year, the UK bar/restaurant division and the
companies which traded as the Gaiety Theatre in Dublin.
NOTES TO THE ACCOUNTS (CONTINUED)
FOR THE EIGHTEEN MONTHS ENDED 2 OCTOBER 2000
3. (LOSS)/EARNINGS PER SHARE
(Loss)/earnings per share has been calculated as follows:
12
18 months
months ended
ended 4 April
2 1999
October restated
2000
Stg# Stg#
(Loss)/profit for the period (1,912,000) 416,000
Preference dividends (394,000) (262,000)
Non-equity appropriations (12,000) (12,000)
Basic (loss)/earnings (2,318,000) 142,000
Average shares in issue - basic 33,562,749 33,562,749
Basic (loss)/earnings per share (7.00)p 0.42p
Diluted (loss)/earnings (2,318,000) 142,000
Average shares in issue - basic 33,562,749 33,562,749
Dilutive potential ordinary shares:
Employee share options 1,388,342 8,627
Warrants - -
Average shares in issue - diluted 34,951,091 33,562,749
Diluted (loss)/earnings per share (6.63)p 0.42p
The weighted average number of ordinary shares for the purpose of calculating
the diluted (loss)/earnings per ordinary share includes options under employee
share schemes as these are dilutive in respect of the net profit per share on
continuing operations for the period as defined by FRS14.
4. TANGIBLE FIXED ASSETS
Following the publication of FRS15, Tangible Fixed Assets pre-opening expenses
will be expensed as incurred. Previously these expenses were included in
prepayments and amortised through the profit and loss account over a 3 year
period from 6 months after the opening of the relevant venue. The amortisation
charge in the period under this policy would have been Stg#268,000. Operating
expenses in the year ended 4 April 1999 have been increased by Stg#536,000 as a
result of this change in policy. Pre-opening expenses of Stg#191,000 have been
expensed in the period.
The directors have also reviewed the appropriateness of depreciation policies
and methods of write-off in the light of guidance set out in FRS15. It has been
determined that licensed leasehold premises should now be written-off on a
straight line basis over the lease term. Previously the annuity method had been
used. The additional depreciation arising in the period to 2 October 2000 as a
result of this change in method was Stg#114,000.
5. PROFIT AND LOSS ACCOUNT
Included in the profit and loss account is goodwill written-off of
Stg#7,103,000.
Capital Bars (LSE:CLB)
Gráfico Histórico do Ativo
De Ago 2024 até Set 2024
Capital Bars (LSE:CLB)
Gráfico Histórico do Ativo
De Set 2023 até Set 2024