Final Results
31 August 2001 - 12:28AM
UK Regulatory
RNS Number:2282J
Deep-Sea Leisure PLC
30 August 2001
Date: Thursday 30 August 2001
Contacts: Alastair Ritchie, Chairman, Deep-Sea Leisure 0131 220 3900
David McCorquodale, KPMG Corporate Finance 0131 222 2000
Deep-Sea Leisure PLC
Preliminary Announcement of Financial Results to 28 February 2001
Highlights
2001 2000
#000 #000
Turnover 5,056 5,477
Operating profit before exceptional items 132 1,451
Pre-tax profit/(loss) before exceptional items (719) 557
Headline Earnings per share 8.98p 8.89p
Earnings/(loss) per share before exceptional items (8.11)p 8.89p
Chairman's Statement
I have particular pleasure in reporting to Shareholders on a successful
outcome to a traumatic year for your Company, during which a financial
reconstruction was implemented, as a result of which the business is now in
good health.
I do not propose to repeat the narrative contained in my statement of a year
ago and subsequent circulars to Shareholders. However, I think it appropriate
to place on record that the Company's funding problems arose primarily from a
breakdown in its relationship with the then bankers and a resultant crisis of
confidence on both sides.
Quite simply, the banks advanced too much debt, the repayment profile for
which was overly ambitious. Despite generating operating profits in difficult
market conditions and imposing spending restrictions, the resultant cash flow
was insufficient for the Company to meet its obligations and covenants were
breached.
Although the underlying problem arose from capital overspending, we should
recognise that specialist visitor attractions are frequently built with
speculative budgets and the previous Board of Directors' achievement in
building the Blue Planet Aquarium should be viewed in that context.
The results for the year require to be interpreted carefully in order to
appreciate our trading performance in an extraordinary period in the
Company's history. A windfall profit arose through the former banks'
agreement to write off debt, against which there were costs incurred in
negotiating and implementing the financial reconstruction. Further to
complicate matters, trading was affected by poor market conditions and, in
addition, cash constraints arising from the funding crisis severely
restricted our ability to run the business at our normal level of
profitability.
Turnover for the year was #5.1m against #5.5m last year. Operating profit
before exceptional items was #0.1m compared with #1.5m. Operating profit
after exceptional items was #1.6m, these being made up of a gain of #2.0m
arising from the debt forgiveness, offset by #0.5m of costs incurred relating
to the financial restructuring. A further #0.3m of related costs were offset
against the share premium account.
Most significantly the balance sheet has been transformed, net current
liabilities being reduced by #8.6m and net assets enhanced by #4.3m with a
resultant lowering of on-going interest costs and a significant reduction in
gearing.
Against the above background, Shareholders will understand that the Board is
unable to recommend a dividend on this occasion.
At the time of writing we are in the last week of the current half-year and I
shall be circulating the results in due course. However, I can report that
our performance has improved significantly this year, with visitor numbers up
overall by 10%, incorporating a particularly encouraging recovery at Deep Sea
World.
On your behalf, I should like to thank all those employees, professional
advisors, long-term creditors and institutions who combined in the most
trying circumstances to achieve what has been a creditable reconstruction.
There is no doubt that, as a consequence, we have been able to invest at both
aquariums in order to upgrade our facilities and to finance appropriate
marketing activities.
As a result, we have now put the problems of last year behind us and we can
focus once more on developing the business.
Alastair Ritchie
Chairman
30 August 2001
Profit and loss account
for the year ended 28 February 2001
Before Exceptional
exceptional items
items 2001
2001 #000 2001 2000
#000 #000 #000
Turnover 5,056 - 5,056 5,477
Cost of sales (976) - (976) (724)
______ ______ _______ _______
Gross profit 4,080 - 4,080 4,753
Administrative expenses (3,948) (485) (4,433) (3,302)
Waiver of debt - 2,000 2,000 -
______ ______ _______ _______
Operating profit 132 1,515 1,647 1,451
Interest payable and (851) - (851) (894)
similar charges
______ ______ _______ _______
(Loss)/profit on
ordinary activities (719) 1,515 796 557
before taxation
Tax on (loss)/profit on - - - -
ordinary activities
______ ______ _______ _______
(Loss)/profit retained
for the financial year (719) 1,515 796 557
for equity shareholders
Earnings per ordinary 8.98p 8.89p
share
(Loss)/earnings per
ordinary share before
exceptional items (8.11)p 8.89p
Balance sheet
at 28 February 2001
2001 2000
#000 #000 #000 #000
Fixed assets
Tangible assets 18,926 19,789
Current assets
Stocks 366 625
Debtors 39 250
Cash at bank and in hand 1,297 14
______ ______
1,702 889
Creditors: amounts falling
due within one year (4,871) (12,691)
______ ______
Net current liabilities (3,169) (11,802)
______ ______
Total assets less current 15,757 7,987
liabilities
Creditors: amounts falling
due after more than one year (4,255) (158)
Accruals and deferred income (1,709) (2,380)
______ ______
Net assets 9,793 5,449
Capital and reserves
Called up share capital 960 1,316
Share premium account 5,902 3,001
Capital redemption reserve 1,003 -
Profit and loss account 1,928 1,132
______ ______
Shareholders' funds 9,793 5,449
Equity 9,793 4,952
Non-equity - 497
______ ______
9,793 5,449
Cash flow statement
for the year ended 28 February 2001
Reconciliation of operating (loss)/profit to net cash 2001 2000
inflow from operating activities #000 #000
Operating profit 1,647 1,451
Waiver of debt (2,000) -
Depreciation charges 886 801
Decrease in stocks 259 58
Decrease/(increase) in debtors 211 (111)
Increase in creditors 125 387
Grant released (671) (671)
_____ _____
Net cash inflow from operating activities 457 1,915
Cash flow statement
Net cash inflow from operating activities 457 1,915
Returns on investments and servicing of finance (998) (619)
Capital expenditure (23) (1,221)
______ ______
Cash (outflow)/ inflow before financing (564) 75
Financing 2,617 1,824
______ ______
Increase in cash 2,053 1,899
Notes
1) Basis of preparation
The abridged financial information has been provided using accounting
policies consistent with those adopted by Deep-Sea Leisure PLC in its
financial statements for the year ended 28 February 2001 and was approved by
the board on 30 August 2001.
2) Earnings per ordinary share
2001 2000
#000 #000
Earnings are calculated as follows:
(Loss)/profit after tax (719) 557
Exceptional income 1,515 -
______ ______
Earnings before exceptional items 796 557
Basic earnings per share 8.98p 8.89p
(Loss)/earnings per share before exceptional (8.11)p 8.89p
items
All calculations of earnings per share are based on the weighted average
number of ordinary shares in issue during the year of 8,860,278 (2000 -
6,267,063) calculated in accordance with Financial Reporting Standard 14.
Headline earnings per share are calculated in accordance with the formula
published by the Institute of Investment Management and Research. Adjusted
earnings per share are shown to provide shareholders with additional
information on continuing operations.
3) General
The financial information set out above does not comprise the Company's
statutory accounts. Statutory accounts for the previous financial year ended
29 February 2000 have been delivered to Companies House. Statutory accounts
for the financial year ended 28 February 2001 will shortly be delivered to
shareholders and Companies House. The auditor's reports on both year's
accounts are unqualified and do not contain any statement under section
237(2) or (3) of the Companies Act 1985.
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