RNS Number:1756L
Clubhaus PLC
16 May 2003
Friday 16 May 2003: embargoed for release at 7.01am
John Hume, Chairman
Charlie Parker, Managing Director
Paul Stephens, Finance Director
Clubhaus PLC Tel: 0870 240 8924
Capel Irwin
KBC Peel Hunt Limited Tel: 020 7418 8900
Edward Bridges
Financial Dynamics Tel: 020 7831 3113
Clubhaus PLC
Clubhaus, the Leisure Group, announces unaudited interim results for the six
months ended 31 March 2003.
Key points:
* Trading encouraging across the Group
* Seven Country Clubs performing well
* Compelling development opportunities at four remaining clubs, though
further financing required
* 7,000 new members during the first half of the financial year
* Central overhead reduced
* Disposal of final non-core businesses - Three Rivers and the Fox Club
* Thierry Delsol and Paul Stephens appointed to the Clubhaus board as Chief
Operating Officer and Finance Director respectively
Financials:
* Turnover up to #11.7m from #10.8m, based on the continuing activities
at the 11 core clubs
* Operating margin before depreciation and central costs improved from
14% to 21%, based on the continuing activities at the 11 core clubs
* Profit before interest and tax of #531,000 (2002: loss of #4m)
* Net debt reduced to #57.7m (2002: #103.3m)
Directors and Principal Advisers
Directors Auditors
John Hume Baker Tilly
Chairman 2 Bloomsbury Street
Charlie Parker London
Managing Director WC1B 3ST
Thierry Delsol Nominated Adviser and Broker
Chief Operating Officer KBC Peel Hunt Ltd
Paul Stephens 111 Old Broad Street
Finance Director London
Norman Riddell EC2N 1PH
Non-executive Director Principal Bankers
Paul Sellars Barclays Bank PLC
Non-executive Director PO Box 15 161R
Company Secretary 50 Pall Mall
Paul Stephens London
Head Office and Registered Office SW1A 1QA
Clubhaus PLC Registrars and Transfer Office
Bath Road Capita IRG Plc
Knowl Hill The Registry
Reading 34 Beckenham Road
Berkshire Beckenham
RG10 9AL Kent
Tel: 0870 240 8924 BR3 4TU
Fax: 0870 240 8925
Registered number: 3125439
Chairman's Statement
Trading review
The core business, which consists of the 11 Clubs listed in this statement, has
traded well during the first half of the financial year. The results from all 11
Clubs are pleasing with trading ahead of the comparative period, as illustrated
by note two on page six relating to continuing operations. The seasonally
stronger second half of the year remains all-important and has begun
encouragingly with a high renewal rate and strong operating revenues in April.
The seven Clubs that have been developed into "Country Clubs" have led the way
in terms of performance and the prospects for these Clubs are very encouraging.
The development opportunities that exist at the four remaining Clubs remain
compelling, although reliant on new capital or some form of off balance sheet
finance.
The Clubhaus product is proving to be robust during a difficult trading
environment, with over 7,000 new members signed up since the start of the
financial year across the core 11 Clubs. We have successfully consolidated the
Group's central operations, resulting in both a reduction in central overheads
and in administrative costs incurred at Club level. Margins have seen a small
improvement from the comparative period.
Disposals
During the first half of the financial year we disposed of the two remaining
non-core Clubs, Three Rivers and The Fox Club. The proceeds from these disposals
were approximately #3.75 million (of which #1.45 million was received after the
balance sheet date) and have been used to reduce the Group's borrowings.
Provided that the financial gearing of the Group can be reduced by other means,
there are no plans to dispose of any of the remaining operating businesses which
form the core portfolio. However, there are opportunities to realise value from
the estate through the development and sale of ancillary land. Modest success
has been enjoyed in this area over the past two years and we believe this can be
repeated in the coming months.
Strategy
The operational strategy for the Group has two clear goals.
Firstly, we intend to continue to focus on the UK Country Club business and to
improve the returns from these Clubs. Performance of these businesses has
continued to improve, both in terms of membership and other sales, whilst
efforts to reduce overheads and improve margins have also been successful.
Secondly, we wish to develop the four remaining Clubs, which currently do not
offer health and fitness facilities, into Country Clubs. Currently, the Group's
level and cost of borrowings prevent it from fulfilling these development plans.
However, total debt has been reduced substantially over the past 12 months and
we are working on initiatives to continue this reduction, which ultimately will
allow the developments to take place.
Bank borrowings
In conjunction with a review of the Company's capital base, we are currently
discussing a new bank facility with Barclays to better assist the delivery of
the Group's strategy. The existing medium term loan facility with Barclays stood
at #37.0 million at 31 March 2003 (#41.0 million at 30 September 2002) and has
subsequently been reduced to #36.4 million. In addition the Group has an
overdraft facility with Barclays of #1.3 million (#1.3 million at 30 September
2002).
Two medium term loan facilities are in place with The Royal Bank of Scotland,
which on a combined basis stood at #4.1 million at 31 March 2003 (#4.3 million
at 30 September 2002) and have subsequently been reduced to #4.0 million.
Bond arrangement
In December 2002, the Company exercised its option to pay the interest due on
the bond for the period 17 May 2002 to 31 December 2002 in kind, via the issue
of new bonds representing a coupon of 10%. The bond principal (par value) has
therefore increased from #15.0 million to #15.9 million. Under FRS 4 "
Accounting for capital instruments", the bonds are stated in the balance sheet
net of approximately #1.1million of costs associated with their issue. The
bonds carry a coupon of 8% in 2003 and 12% thereafter, but carry an option to
pay the interest for the year ending 31 December 2003 in kind at the rate of
10%. For presentational purposes only, interest for the period 1 January 2003
to 31 March 2003 has been accrued at a rate of 8%.
Board
As was reported in the last Report and Accounts, Thierry Delsol joined the Board
as Chief Operating Officer on 18 December 2002.
In addition, I am pleased to announce the appointment of Paul Stephens as the
new Finance Director with immediate effect. Paul has been performing the role of
Chief Financial Officer since the restructuring and we all welcome him onto the
Board.
Fixed Assets
In accordance with FRS 15 "Tangible Fixed Assets" the fixed assets have been
valued at 31 March 2003 by the Directors. No adjustment has been made to the
carrying values.
The Clubs
Benton Hall Golf Club, Witham, Essex **
Castle Royle Golf and Country Club, Knowl Hill, Berkshire *
Chartham Park Golf Club, East Grinstead, West Sussex **
The Essex Golf and Country Club, Earls Colne, Essex *
Mapledurham Golf & Health Club, Mapledurham, Berkshire *
Mentmore Golf & Country Club, Mentmore, Bedfordshire *
The Club at Meyrick Park, Bournemouth, Dorset *
Nizels Golf and Country Club, Hildenborough, Kent *
Seedy Mill Golf Club, Lichfield, Staffordshire **
The Tytherington Club, Tytherington, Cheshire *
The Warwickshire, Leek Wootton, Warwickshire **
* Country clubs constructed
** Country club planning consent obtained
Staff
I would like to thank all of the Clubhaus team. The trading improvement year on
year is a clear testament to our staff's continued expertise and
professionalism.
Dividend
An interim dividend is precluded.
Conclusion
The performance of the core business has reinforced our belief in the potential
of the UK Country Club strategy. The undeveloped planning consents give the
Group an opportunity to pursue this strategy and add value to shareholders'
equity. The primary challenge is to overcome the restrictive and high level of
borrowings, thereby permitting the release of the undoubted potential within the
portfolio.
John Hume
Chairman
16 May 2003
Consolidated Profit and Loss Account
Six months ended 31 March 2003
Unaudited Unaudited
six months six months Audited
Note ended ended Year ended
31 March 31 March 30 September
2003 2002 2002
#'000 #'000 #'000
Turnover 2 11,939 14,876 34,100
Cost of sales 2 (5,620) (8,033) (17,322)
Gross profit 2 6,319 6,843 16,778
Administrative expenses (excluding exceptionals) (5,788) (9,563) (17,146)
Exceptional Administrative expenses - (1,421) (1,163)
Total administrative expenses (5,788) (10,984) (18,309)
Operating profit / (loss) 2 531 (4,141) (1,531)
Profit / (loss) on disposal of fixed assets - 131 (4,057)
Profit / (loss) on ordinary activities
before interest 531 (4,010) (5,588)
Net interest payable (2,177) (5,571) (8,706)
Loss on ordinary activities before taxation (1,646) (9,581) (14,294)
Taxation on loss on ordinary activities - 37 1,330
Loss on ordinary activities after taxation (1,646) (9,544) (12,964)
Loss per share: basic 3 (0.2p) (9.3p) (3.2p)
Loss per share: diluted 3 (0.2p) (9.3p) (3.2p)
An analysis of the above information showing the contribution from continuing
activities is shown in note 2 on page 6.
Consolidated balance sheet
Unaudited Unaudited Audited
31 March 31 March 30 September
2003 2002 2002
#'000 #'000 #'000
Fixed assets
Tangible assets 73,555 88,606 77,054
Current assets
Stocks 820 1,233 838
Debtors falling due after more than one year 785 1,039 1,083
Debtors falling due in less than one year 2,722 1,749 2,141
Cash at bank and in hand 222 550 974
4,549 4,571 5,036
Creditors: amounts falling due within one year (12,710) (61,533) (12,414)
Net current liabilities (8,161) (56,962) (7,378)
Total assets less current liabilities 65,394 31,644 69,676
Creditors: amounts falling due after
more than one year (51,034) (59,538) (53,670)
Provisions for liabilities and charges (55) (55) (55)
Net assets / (liabilities) 14,305 (27,949) 15,951
Capital and reserves
Called up share capital 915 51,561 915
Other reserves 139,234 30,365 139,234
Profit and loss account (125,844) (117,665) (124,198)
Equity shareholders' funds / (deficit) 14,305 (35,739) 15,951
Non equity preference shares - 7,600 -
Total shareholders' funds / (deficit) 14,305 (28,139) 15,951
Equity minority interests - 190 -
Total 14,305 (27,949) 15,951
Consolidated cash flow statement
Unaudited Unaudited Audited
six months ended six months ended year ended
31 March 31 March 30 September
2003 2002 2002
#'000 #'000 #'000
Net cash inflow / (outflow) from
operating activities (note 4) 1,303 (3,409) (782)
Net cash outflow from returns on
investments and servicing of finance (1,330) (1,570) (3,237)
Tax received 450 - -
Net cash outflow from capital expenditure
and financial investment (1,023) (826) (7,872)
Acquisitions and disposals 2,245 3,767 11,714
Net cash inflow from investing activities 1,222 2,941 3,842
Net cash inflow / (outflow) before use of
liquid resources and financing 1,645 (2,038) (177)
Net cash (outflow) / inflow from financing (2,514) (520) 3,946
(Decrease) / Increase in cash (869) (2,558) 3,769
Reconciliation of net cash flow to
movement in net debt
(Decrease) / Increase in cash and overdrafts (869) (2,558) 3,769
Cash outflow / (inflow) from decrease /
(increase) in debt and lease finance 2,514 520 (3,946)
Change in net debt resulting from cash flows 1,645 (2,038) (177)
Loans and finance leases disposed of with
disposals - - -
Other non cash changes to loans (994) (212) 42,888
New finance leases - - -
Movement in net debt 651 (2,250) 42,711
Opening net debt (58,383) (101,094) (101,094)
Closing net debt (57,732) (103,344) (58,383)
Notes to the interim statement for the 6 months ended 31 March 2003
1. Basis of Preparation
a) The financial information contained in this statement does not
constitute statutory accounts within the meaning of the Companies Act 1985 and
is unaudited. The results for the year ended 30 September 2002 do not comprise
statutory accounts for the purpose of section 240 of the Companies Act 1985 and
have been extracted from the Group's published accounts for that period which
have been filed with the Registrar of Companies. The audit report on these
accounts was unqualified.
b) In the opinion of the management of Clubhaus PLC, the accompanying
unaudited consolidated financial statements contain all adjustments, including
normal recurring accruals, necessary to present fairly the financial position as
at 31 March 2003 and the results of operations for six-month periods ended 31
March 2003 and 31 March 2002. The results of operations for the interim period
are not necessarily indicative of the results to be expected for the full year.
These financial statements should be read in conjunction with the financial
statements, and notes thereto, included in the Company's Annual Report and
accounts for the year ended 30 September 2002.
c) The consolidated financial statements include the accounts of the
Company and its subsidiaries, with all significant intercompany transactions and
accounts being eliminated on consolidation.
d) The interim financial statements have been prepared in accordance with
the accounting policies detailed in the financial statements for the period
ended 30 September 2002. In accordance with FRS 15 "Tangible Fixed Assets" the
fixed assets have been valued at 31 March 2003 by the Directors. No adjustment
has been made to the carrying values.
e) The Directors have formed the opinion that with the benefit of the
disposal programme and the banking facilities, it is appropriate to prepare the
financial statements on a going concern basis.
2. Continuing Activities
The performance of the continuing business, consisting of the core 11 clubs and
the head office, has been as shown below. It is not considered meaningful to
allocate line items below operating profit between continuing and discontinuing
categories.
Unaudited Unaudited Audited
six months six months Year
ended ended ended
31 March 31 March 30 September
2003 2002 2002
#'000 #'000 #'000
Turnover 11,732 10,823 24,974
Cost of sales (5,446) (5,299) (11,445)
Gross profit 6,286 5,524 13,529
Administrative expenses, excluding depreciation (3,767) (4,036) (7,617)
Earnings before interest, tax, depreciation and
central costs 2,519 1,488 5,912
Central costs (excluding depreciation) (996) (3,284) (4,198)
Earnings before interest, tax and depreciation 1,523 (1,796) 1,714
Depreciation (878) (908) (1,874)
Operating profit / (loss) 645 (2,704) (160)
3. Loss per share
Loss per share is based on the loss attributable to equity shareholders of #1.6
million (31 March 2002: #9.5 million, 30 September 2002: #13.0 million) and the
weighted average number of ordinary shares in issue during the period being
914,614,165 (31 March 2002: 103,122,833: 30 September 2002: 407,709,990). The
calculation of diluted loss per share is based on the loss attributable to
equity shareholders of #1.6 million and the weighted average number of ordinary
shares in issue during the period being 914,614,165 (31 March 2002: 103,122,833:
30 September 2002: 407,709,990).
4. Reconciliation of Operating Profit / (Loss) to Net Cash Inflow /
(Outflow) from Operating Activities
Unaudited Unaudited
six months six months Audited
ended ended Year ended
31 March 31 March 30 September
2003 2002 2002
#'000 #'000 #'000
Operating profit / (loss) 531 (4,141) (1,531)
Non Cash Exceptional Items - - 480
Depreciation and amortisation 895 1,310 2,575
Decrease / (Increase) in stocks held for resale 4 (110) 42
Decrease / (Increase) in debtors 682 1,552 (52)
Decrease in creditors and deferred income (809) (2,020) (2,296)
Net cash inflow / (outflow) from operating 1,303 (3,409) (782)
activities
5. Analysis of net debt
At Other
1 October Cash Non cash Reclass- 31 March
2002 Flow Changes ification 2003
#'000 #'000 #'000 #'000 #'000
Cash 974 (752) - - 222
Overdrafts (1,083) (117) - - (1,200)
(109) (869) - - (978)
Bank debt within one year (4,652) 2,170 - (3,357) (5,839)
Bank debt over one year (38,616) - - 3,357 (35,259)
Bond debt over one year (13,863) - (994) - (14,857)
Obligations under finance leases (1,143) 344 - - (799)
(58,274) 2,514 (994) - (56,754)
Total net debt (58,383) 1,645 (994) - (57,732)
Total net debt excludes non-interest bearing advances from members.
6. Share Capital
As at 31 March 2003, the Company had 914,614,165 shares in issue with a nominal
value of 0.1 pence per ordinary share (30 September 2002, 914,614,165 shares of
0.1 pence; 31 March 2002, 103,122,833 shares of 50 pence).
7. Taxation
No provision for tax has been made due to brought forward tax losses and the
losses incurred by the group in the period.
8. Other information
This statement was approved by the Directors on 16 May 2003 and will be posted
to all shareholders shortly thereafter. Further copies are available from the
registered office of the Company at Clubhaus PLC, Bath Road, Knowl Hill,
Reading, Berkshire RG10 9AL
Statement of the Directors
The interim financial statements set out on pages 3 to 8 have been approved by
the directors and have been prepared on a basis consistent with the audited
financial accounts for the year ended 30 September 2002.
The interim financial statements for the six months ended 31 March 2003, were
approved by the board of directors on 16 May 2003 and are unaudited but have
been reviewed by Baker Tilly.
The Independent Review Report to Clubhaus PLC
We have been instructed by the Company to review the financial information set
out on pages 3 to 8 and we have read the other information contained in the
interim report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.
Directors' responsibilities
The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the directors. The AIM Rules of
the London Stock Exchange require that the accounting policies and presentation
applied to the interim figures should be consistent with those applied in
preparing the preceding annual accounts except where any changes, and the
reasons for them, are disclosed.
Review work performed
We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board. A review consists principally of making
enquiries of Group management and applying analytical procedures to the
financial information and underlying financial data and based thereon, assessing
whether the accounting policies and presentation have been consistently applied
unless otherwise disclosed. A review excludes audit procedures such as tests of
controls and verification of assets, liabilities and transactions. It is
substantially less in scope than an audit performed in accordance with Auditing
Standards and therefore provides a lower level of assurance than an audit.
Accordingly we don't express an audit opinion on the financial information.
Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 31 March 2003.
Baker Tilly
Chartered Accountants
2 Bloomsbury Street
London WC1B 3ST
16 May 2003
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