TIDMJD.
RNS Number : 7959E
JD Sports Fashion Plc
13 April 2011
13 April 2011
JD SPORTS FASHION PLC
PRELIMINARY RESULTS
FOR THE 52 WEEKS ENDED 29 JANUARY 2011
JD Sports Fashion Plc (the 'Group'), the leading retailer and
distributor of sport and athletic inspired fashion apparel and
footwear, today announces its Preliminary Results for the 52 weeks
ended 29 January 2011.
2011 2010
GBP000 GBP000 % Change
Revenue 883,669 769,785 +15%
======== ========
Gross profit % 49.5% 49.3%
======== ========
Operating profit (before exceptional items) 79,927 67,294 +19%
Share of results of joint venture before
exceptional items
(net of income tax) 1,475 539
Net financial income / (expenses) 163 (442)
-------- --------
Profit before tax and exceptional items 81,565 67,391 +21%
Exceptional items (see note 3) (4,284) (4,986)
Share of exceptional items of joint venture
(net of income tax) (a) 1,348 (1,012)
-------- --------
Profit before tax 78,629 61,393 +28%
======== ========
Basic earnings per ordinary share 114.84p 88.16p +30%
Adjusted basic earnings per ordinary share
(see note 5) 116.86p 93.64p +25%
Total dividend payable per ordinary share 23.00p 18.00p +28%
Net cash at end of period (b) 86,140 60,465
a) The exceptional items in the current year relate to
unrealised gains on foreign exchange contracts and the reversal of
the impairment of the investment held by Focus Brands Limited in
Focus Group Holdings Limited, following repayment of original
purchase consideration by the vendors of Focus Group Holdings
Limited. The exceptional items in the prior year relate entirely to
unrealised losses on foreign exchange contracts.
b) Net cash consists of cash and cash equivalents together with
interest-bearing loans and borrowings.
Highlights
-- Total revenue increased by 14.8% to GBP883.7 million (2010:
GBP769.8 million) with like for like revenue increased by 3.1%
(Sports Fascias 3.8%; Fashion Fascias -0.7%)
-- Gross margin improved to 49.5% (2010: 49.3%) with increased
margin in all reporting segments although the increase is diluted
by greater participation in Group performance from lower margin
distribution businesses which now represent 9.5% of Group revenue
(2010: 5.4%)
-- Group profit before tax and exceptional items up 21% to
GBP81.6 million (2010: GBP67.4 million)
-- Profit before tax up 28% to GBP78.6 million (2010: GBP61.4
million)
-- Net cash position at the period end increased to GBP86.1
million (2010: GBP60.5 million)
-- Acquisition of Sonneti, Chilli Pepper and Nanny State
brands
-- Capital expenditure increased by GBP10.1m to GBP33.0m (2010:
GBP22.9m) which included the first three JD stores in France
-- The new leased warehouse building shell in Rochdale (866,250
sq ft including mezzanines) has now been handed over by the
developers and the fit out process has started. Total anticipated
fit out costs are approximately GBP20.0m of which GBP3.9m was
incurred in the year. The move to full operational use will be
phased through the early months of 2012
-- Final dividend payable increased by 31% to 19.2p (2010:
14.7p) bringing the total dividends payable for the year up to
23.0p (2010: 18.0p), an increase of 28% with a cumulative rise of
92% over the last two years
-- Acquisition of Champion completed post year end, enhancing
presence in the Republic of Ireland
Peter Cowgill, Executive Chairman, said:
"The year ended 29 January 2011 has been the seventh successive
year of good progress in revenue and profitability for the Group.
Profit before tax and exceptional items improved by 21% to GBP81.6
million (2010: GBP67.4 million). Such sustained performance
continues to reflect the strength and uniqueness of our brand and
fascia offers as well as the strength of our management teams. Our
very strong cash position has also allowed us to continue to invest
in brands, our store portfolios and new businesses during the year
and since the year end.
"Confidence arising from the sustained period of results
improvement and the strength of our balance sheet has enabled the
Board to propose another significant increase in the level of
dividends with a final proposed dividend increase of 31% to 19.2p
(2010: 14.7p) bringing the total dividends payable for the year to
23.0p (2010: 18.0p), an increase of 28% following on from the rises
of 50% and 41% in the last two years.
"Following successive years of record results for the Group, the
retail environment has recently been significantly impacted by
adverse fiscal changes in addition to the multiple current economic
pressures. Our core business already possesses very strong sales
densities and margins, being the result of continual growth in both
measures for several years. Against that background, therefore, it
is inevitable that the Board is extremely cautious in its outlook,
particularly when the profits achieved for the year to 29 January
2011 are effectively rebased purely as a result of the impact of
increased VAT.
"Management remain highly focused on all avenues of revenue
growth, margin protection and cost control available to us to
endeavour to deliver the optimum outturn, minimise the impact of
the factors above, and with a strong balance sheet and dominant
market position in our core business, we expect to be able to
deliver operational and financial progress for the Group over the
long term."
Enquiries:
JD Sports Fashion Plc Tel: 0161 767 1000
Peter Cowgill, Executive Chairman
Barry Bown, Chief Executive Officer
Brian Small, Finance Director
MHP Communications Tel: 020 3128 8100
Andrew Jaques
Barnaby Fry
Ian Payne
Executive Chairman's Statement
Introduction
The year ended 29 January 2011 has been the seventh successive
year of good progress in revenue and profitability for the Group.
Profit before tax and exceptional items improved by 21% to GBP81.6
million (2010: GBP67.4 million). Such sustained performance
continues to reflect the strength and uniqueness of our brand and
fascia offers as well as the strength of our management teams. Our
very strong cash position has also allowed us to continue to invest
in brands, our store portfolios and new businesses during the year
and since the year end.
Group profit before tax increased by 28% in the year to GBP78.6
million (2010: GBP61.4 million) and Group profit after tax has
increased by 31% to GBP55.9 million (2010: GBP42.7million).
Group operating profit (before exceptional items) for the year
was up 19% to GBP79.9 million (2010: GBP67.3 million) and comprises
a Sports Fascias profit of GBP73.3 million (2010: GBP64.1 million),
a Fashion Fascias profit of GBP6.4 million (2010: GBP3.3 million)
and a Distribution segment profit of GBP0.2 million (2010: loss of
GBP0.1 million).
The year end net cash position has risen to GBP86.1 million
(2010: GBP60.5 million). The Group has recently negotiated terms on
new committed rolling credit and working capital facilities
totalling GBP75 million. These new facilities expire in October
2015 and when combined with our cash resources give the Group the
funding capability to continue to develop operationally and by
acquisition both in the United Kingdom and overseas. Confidence
arising from the sustained period of results improvement and the
strength of our balance sheet has enabled the Board to propose
another significant increase in the level of dividends with a final
proposed dividend increase of 31% to 19.2p (2010: 14.7p) bringing
the total dividends payable for the year to 23.0p (2010: 18.0p), an
increase of 28% following on from the rises of 50% and 41% in the
last two years.
Acquisitions
The Sports and Fashion retail offers continue to provide
consumers with a unique mix of sports and fashion brands in both
apparel and footwear including a substantial range of exclusive
products as well as exclusive licensed and own brands such as
McKenzie and Carbrini. We have continued to invest in increasing
the own brand offers through the acquisition of the Sonneti, Chilli
Pepper, and Nanny State brands for a total consideration of GBP2.1
million. Since the year end we have continued this strategy by
acquiring the Fenchurch brand for GBP1.1 million.
The strength of the JD offering gives potential for further
replication internationally, albeit in Europe initially. We see
this as a key opportunity wherever brands recognise our strength in
developing brands and maintaining their prestige. We started to
exploit this opportunity when we acquired the French retailer
Chausport in May 2009. The first full year since the acquisition
contributed GBP36.4 million of revenue and GBP0.5 million of
operating profit. Like for like sales grew by 12.5% in the year and
gross margin improved by 2.7% but overheads increased to support
the opening of three JD stores in France which opened late in the
year. These latter stores are performing to expectations so
far.
We are looking at potential acquisitions and joint ventures in
other territories on a regular basis and we have no doubt that the
Chausport acquisition has enhanced our visibility and credibility
as an overseas investor. Since the year end we have acquired a
further Sports Fascia chain in the Republic of Ireland, Champion
Sports (Holdings) ('Champion'), for a nominal amount and have also
advanced EUR17.1 million to allow it to settle all of its
indebtedness save for EUR2.5 million of leasing finance. This has
added 22 stores to the 8 already operated in the Republic of
Ireland and gives us a significant market position throughout the
whole of Ireland. It also gives us more local knowledge and a
strong management team on the ground.
After the year end we also acquired 80% of Kukri Sports Limited
which provides a bespoke teamwear offering across a wide range of
sports in a number of countries.
Sports Fascias
The Sports Fascias' total revenue increased by 8% during the
period to GBP667.2 million (2010: GBP615.5 million) with like for
like sales for the year up by a further 3.8% (2010: 2.3%).
Gross margin achieved in the Sports Fascias increased from 50.6%
to 51.0% which we attribute to the continued improvement in the
terminal stock position in JD plus the impact from the extension of
enhanced Group supplier terms into the Chausport business.
As a result of this improved margin and continuing enhancement
of the store portfolio and its efficiencies, the operating profit
(before exceptional items) of the Sports Fascias rose to GBP73.3
million (2010: GBP64.1 million) in the year, including a
contribution of GBP0.5 million from Chausport (2010: GBP0.7
million). The contribution from Chausport is lower than the
previous year due to the seasonal losses incurred in the early part
of the year which were pre-acquisition in the prior year.
The programme of store development has continued with 28 store
openings and 24 refurbishments or conversions. These include the
opening of our first 3 JD stores in France (of which 1 was a
conversion of a former Chausport store in Lille), 5 new Chausport
stores, 2 new Size? stores and 3 new JD stores in airport
locations. We have also opened a JD store at one of the UK's
busiest train stations (Liverpool Street) which is our first store
in this type of location and, if successful, could be replicated in
other major stations. 21 Sports Fascias stores were closed in the
period including 6 smaller Chausport stores.
Fashion Fascias
The Fashion Fascias are Bank and Scotts.
The Bank Fascia stores sell largely branded fashion to both
males and females, predominantly for the teenage to mid twenties
sector. In the year the store portfolio grew from 65 stores to 74
stores, still based predominantly in the North and the Midlands.
Total revenue in the year was GBP102.4 million (2010: GBP82.8
million). This represents an organic decrease of 0.9% (2010: +4.7%)
although this decrease came from trading in the first half of the
year when the organic performance was measured against heavy
clearance from the prior year. This reduction in clearance activity
is reflected in the fact that gross margin achieved improved by a
further 0.5% to 48.9% (2010: 48.4%) after an increase of 2.3% in
the prior year. Operatingprofit (before exceptional items) was
GBP5.2 million (2010: GBP3.0 million). The Board remains confident
that there is a significant opportunity to grow operating margin in
this Fascia through better stock management, own brand development
and disciplined store rollout although this will be challenging in
2011 as a result of VAT, cotton and other fibre price increases and
changes in brand distribution policy.
The Scotts Fascia stores sell branded fashion to older more
affluent males and there were 37 stores at the year end, largely in
the North and the Midlands. Total revenue in the year was GBP31.7
million (2010: GBP31.8 million) which was flat organically.
However, the balance of trading towards full price full margin
improved significantly driving an increase in the gross margin
achieved to 49.5% (2010: 47.4%). This has led to an improved
operating result with operating profit (before exceptional items)
of GBP1.2 million (2010: GBP0.3 million).
Distribution
The Distribution businesses delivered a small operating profit
of GBP0.2 million (2010: loss of GBP0.1 million) with a profit from
Canterbury offset by ongoing investment to build Getthelabel.com
within Topgrade, and by losses incurred in Kooga's quietest trading
period of the year, much of which fell prior to its acquisition
last year.
Canterbury delivered an operating profit of GBP1.1 million
(2010: GBP0.1 million) on total revenues of GBP48.3 million (2010:
GBP15.4 million) with a strong performance in both Australia and
New Zealand where the brand was more sheltered from the events that
led to the administration of the former UK based Canterbury
business in 2009. The brand is still rebuilding its global network
and it is hoped that longer term gains will come from the new
licences in South Africa and Argentina, and the launch of a UK
based business (in which we are the 75% majority shareholder)
focusing on developing a more fashion based product offer to
leverage the brand's image and credibility. Canterbury will be
providing the kit for 4 teams at the forthcoming Rugby World Cup
and the Board are confident that this global exposure will enhance
the reputation and penetration of the Brand.
The Getthelabel.com online and catalogue business within
Topgrade has now been trading for over a year. Its sales progress
is encouraging and on schedule but the marketing and other
investment required to achieve this means that we believe it could
take a further two years before it has sufficient critical mass to
deliver profits to the Group. This is not unusual in such
businesses and we remain optimistic about the long term
profitability of this venture. As a consequence of this, sales rose
to GBP26.6 million (2010: GBP19.7 million) but losses rose to
GBP0.8 million (2010: GBP0.4 million) in the year. This was in line
with our expectations and we subsequently increased our stake in
Topgrade from 51% to 80% during the year at a cost of GBP1.2
million.
Kooga Rugby went through a difficult period under its previous
ownership and a lot of effort has been focused on improving control
over the commerciality of the sponsorship properties and the
profitability of product ranges and accounts. An operating loss of
GBP0.3 million was recorded for the year (2010: profit of GBP0.2
million for the post-acquisition period) on sales of GBP6.5 million
(2010: GBP5.0 million). We have strengthened the management team
which we believe will lead to improvements in operating performance
in due course.
Nicholas Deakins recorded a profit of GBP0.2 million (2010:
GBP0.0 million) on turnover of GBP3.4 million (2010: GBP2.5
million) in the year.
Joint Venture
Focus Brands Limited, is involved in the design, sourcing and
distribution of footwear and apparel both for own brand and under
license brands for both group and external customers. Our share of
operating results for the year was an operating profit before
exceptional items and after tax of GBP1.5 million (2010: GBP0.5
million).
The exceptional items in the current year relate to unrealised
gains on foreign exchange contracts and the reversal of the
impairment of the investment held by Focus Brands Limited in Focus
Group Holdings Limited, following repayment of original purchase
consideration by the vendors of Focus Group Holdings Limited. The
exceptional items in the prior year relate entirely to unrealised
losses on foreign exchange contracts.
After the year end we increased our holding in this business to
80% at an initial cost of GBP1.0 million with potential further
deferred consideration of GBP250,000 depending on performance. The
performance of this business will be included in the Distribution
segment in future.
Group Performance
Revenue
Total revenue increased by 14.8% in the year to GBP883.7 million
(2010: GBP769.8 million) principally as a result of three factors:
the Group's positive like for like sales performance of 3.1%, a net
increase of 15 stores and GBP41.5 million of sales from the pre
acquisition period of the Chausport, Canterbury and Kooga
businesses.
Gross margin
Gross margin achieved increased in all segments. However, an
increase in the participation of the lower margin distribution
businesses within the Group's overall performance from 5.4% to 9.5%
means that the growth in overall Group gross margin was limited to
0.2%.
Operating profits
Operating profit (before exceptional items) increased by GBP12.6
million to GBP79.9 million (2010: GBP67.3 million), a 19% increase
on last year which follows a 24% rise in the previous year. Group
operating margin (before exceptional items) has therefore increased
by a further 0.3% to 9.0% (2010: 8.7%).
Following a decrease in the exceptional items to GBP4.3 million
(2010: GBP5.0 million), Group operating profit rose from GBP62.3
million to GBP75.6 million.
The exceptional items (excluding share of exceptional items in
joint venture) comprise:
GBPm
Impairment of investment property 1.0
Loss on disposal of fixed assets 1.5
Onerous lease provision 1.8
Total exceptional charge 4.3
-----
The impairment of investment property relates to a writedown in
the valuation of the St Albans warehouse occupied by Focus.
The loss on disposal includes both closed stores and assets
written off in refurbished stores.
The charge for onerous lease provisions includes GBP1.1 million
for non-trading stores and GBP0.7 million for trading stores.
Working capital and financing
As a consequence of having net cash throughout the year, the
Group has net financing income of GBP0.2 million compared to net
financing costs in the prior year of GBP0.4 million.
Year end net cash of GBP86.1 million represented a GBP25.6
million improvement on the position at January 2010 (GBP60.5
million).
Net capital expenditure including disposal costs and premia
received increased in the year to GBP32.4 million (2010: GBP23.0
million) with capital expenditure excluding disposal costs
increasing by GBP10.1 million to GBP33.0 million (2010: GBP22.9
million). This increase was focused on the core Sports Fascias
where the spend increased by GBP10.7 million to GBP25.6 million
which included an additional GBP3.9 million in the French business
combined with GBP3.9 million of spend connected with the new
866,250 sq ft warehouse (616,250 sq ft footprint) at Kingsway,
Rochdale. The Board anticipate that approximately GBP15 million
will be incurred in the year to 28 January 2012 on fitting out of
the warehouse. The demonstrable success of investing in the store
portfolio means that we anticipate maintaining spend on the stores
at the current level.
Spend in the Fashion fascias decreased slightly by GBP0.7
million to GBP6.7 million. This decrease does not mean that the
Group is reducing its investment in the Fashion fascias and is more
a function of availability of appropriate property and the timing
of the projects.
Working capital remains well controlled with suppliers
continuing to be paid to agreed terms and settlement discounts
taken whenever due.
Store Portfolio
We have made a further significant investment in the store
portfolio during the year with expenditure on both new stores and
refurbishments of existing space. We have also continued to
rationalise our store portfolio wherever possible but, with the
current economic climate impacting heavily on retail property
occupancy levels, it remains very difficult to dispose of
underperforming and/or duplicate stores.
There was a net increase of 6 stores in the UK & Ireland JD
& Size? portfolios with 21 new stores offset by 15 closures.
Our overall presence has increased in France by 1 store with 7 new
stores (including 2 JD stores in Paris and Lyon) offset by the
closure of 6 smaller Chausport stores. In addition, one Chausport
store has been converted to the JD 'King of Trainers' format in
Lille and the success of that trial means that we will convert a
further 2 Chausport stores (in Angers and Amiens) to this format in
the current period.
There was a net addition of 9 stores in the Bank fascia with 13
store openings offset by the closure of 4 stores. A loss making
duplicate Scotts store in Chester was also closed in the
period.
We have refurbished a total of 29 stores in the year (including
3 stores where space has been transferred between fascias). This
means that over the last four years we have opened a total of 108
stores and refurbished a further 123 stores.
During the year, store numbers (excluding trading websites)
moved as follows:
Sports Fascias
JD & Size? (UK
& Eire) JD (France) Chausport Total
000
000 sq sq 000 sq 000 sq
Units ft Units ft Units ft Units ft
Start of
year 345 1,100 - - 75 78 420 1,178
New stores 21 65 2 4 5 10 28 79
Transfers
(1) - (1) 1 1 (1) (1) - (1)
Closures (15) (35) - - (6) (6) (21) (41)
Remeasures - 2 - - - (2) - -
------ -------- -------- ------ -------- ------- -------- -------
Close of
year 351 1,131 3 5 73 79 427 1,215
------ -------- -------- ------ -------- ------- -------- -------
(1) One JD store (Cardiff) was transferred to Bank in the period
offset by the transfer of one store from Bank to JD (Sutton
Coldfield). One former Chausport store (Lille) was converted into a
JD store.
Fashion Fascias
Bank Scotts Total
000 sq 000 sq 000 sq
Units ft Units ft Units ft
Start of
year 65 176 38 85 103 261
New stores 13 42 - - 13 42
Transfers - 1 - - - 1
Closures (4) (9) (1) (6) (5) (15)
Remeasures - - - (3) - (3)
------ ------- ------ ------- ------ -------
Close of
year 74 210 37 76 111 286
------ ------- ------ ------- ------ -------
Dividends and Earnings per Share
The Board proposes paying a final dividend of 19.20p (2010:
14.70p) bringing the total dividend payable for the year to 23.00p
(2010: 18.00p) per ordinary share. The proposed final dividend will
be paid on 1 August 2011 to all shareholders on the register at 6
May 2011. The final dividend has been increased by 31% with total
dividends payable for the year increased by 28%. This follows a 50%
increase in the full year dividend in the prior year.
The adjusted earnings per ordinary share before exceptional
items were 116.86p (2010: 93.64p).
The basic earnings per ordinary share were 114.84p (2010:
88.16p).
Employees
As ever, after another record year, it is right to give credit
and thanks to all our employees around the world for delivering
such exceptional results. We remain committed to continuing to
develop their skills and prospects through our success, training
and quality of operation.
Current Trading and Outlook
Following successive years of record results for the Group, the
retail environment has recently been significantly impacted by
adverse fiscal changes in addition to the multiple current economic
pressures. Specifically, the increase in VAT for the year to 28
January 2012 means that the same level of gross takings will
produce a contribution of approximately GBP16 million less than the
previous year. Simultaneously, but quite separately, we anticipate
a reduction of real expenditure levels by consumers at a time when
product costs, particularly imported goods, are increasing at a
material rate.
Trading for the early part of the current financial year has
been difficult to gauge when Easter falls three weeks later than
last year. For the 8 weeks to 26 March 2011 gross like for like
sales (including e-commerce) were +0.4% whilst net sales have
declined 1.2% (Sports Fascias -1.4%, Fashion Fascias +0.0%). The
decline in net sales and the resulting reduced margin are directly
as a result of the fiscal changes referred to above.
Our core business already possesses very strong sales densities
and margins, being the result of continual growth in both measures
for several years. Against that background, therefore, it is
inevitable that the Board is extremely cautious in its outlook,
particularly when the profits achieved for the year to 29 January
2011 are effectively rebased purely as a result of the impact of
increased VAT.
On the positive side the business delivers strong operating
ratios and high levels of free cash generation. It has a robust
balance sheet with GBP86.1 million net cash balances at the year
end which leaves the Group well positioned to extend the retail
opportunities which may arise and to continue to pursue a
progressive dividend policy.
Management remain highly focused on all avenues of revenue
growth, margin protection and cost control available to us to
endeavour to deliver the optimum outturn, minimise the impact of
the factors above and, with a strong balance sheet and dominant
market position in our core business, we expect to be able to
deliver operational and financial progress for the Group over the
long term. Opportunities for profit growth overseas and development
of our differentiated and own brand proposition, combined with
prospects for growth in our Distribution business, all help to
reduce the current threats to long term Group profitability and
give us the opportunity to maintain positive long term momentum in
our business.
A further update will be made in our Interim Management
Statement no later than 17 June 2011.
Peter Cowgill
Executive Chairman
13 April 2011
Consolidated Income Statement
For the 52 weeks ended 29 January 2011
52 weeks to
52 weeks to 30 January
29 January 2011 2010
Continuing Continuing
Operations Operations
Note GBP000 GBP000
Revenue 883,669 769,785
Cost of sales (446,657) (390,248)
-------------------------------------- ----- ----------------- ------------
Gross profit 437,012 379,537
Selling and distribution expenses
- normal (326,296) (288,462)
Selling and distribution expenses
- exceptional (3,277) (6,458)
Administrative expenses - normal (32,966) (26,051)
Administrative expenses - exceptional (1,007) 1,472
Other operating income 2,177 2,270
Operating profit 75,643 62,308
Before exceptional items 79,927 67,294
Exceptional items 3 (4,284) (4,986)
------------
Operating profit 75,643 62,308
Share of results of joint venture
before exceptional items (net
of income tax) 4 1,475 539
Share of exceptional items (net
of income tax) 4 1,348 (1,012)
-------------------------------------- ----- ----------------- ------------
Share of results of joint venture 4 2,823 (473)
Financial income 618 385
Financial expenses (455) (827)
-------------------------------------- ----- ----------------- ------------
Profit before tax 78,629 61,393
Income tax expense (22,762) (18,647)
-------------------------------------- ----- ----------------- ------------
Profit for the period 55,867 42,746
-------------------------------------- ----- ----------------- ------------
Attributable to equity holders
of the parent 55,884 42,900
Attributable to non-controlling
interest (17) (154)
Basic earnings per ordinary share 5 114.84p 88.16p
-------------------------------------- ----- ----------------- ------------
Diluted earnings per ordinary 5 114.84p 88.16p
share
-------------------------------------- ----- ----------------- ------------
Consolidated Statement of Comprehensive Income
For the 52 weeks ended 29 January 2011
52 weeks to 52 weeks to
29 January 30 January
2011 2010
GBP000 GBP000
Profit for the period 55,867 42,746
Other comprehensive income:
Exchange differences on translation
of foreign operations 95 (248)
------------------------------------------ ------------ ------------
Total other comprehensive income for
the period 95 (248)
------------------------------------------ ------------ ------------
Total comprehensive income and expense
for the period
(net of income tax) 55,962 42,498
------------------------------------------ ------------ ------------
Attributable to equity holders of the
parent 55,979 42,652
Attributable to non-controlling interest (17) (154)
------------------------------------------ ------------ ------------
Consolidated Statement of Financial Position
As at 29 January 2011
As at
30 January
2010
As at (restated
29 January -
2011 see note 1)
GBP000 GBP000
Assets
Intangible assets 58,315 50,215
Property, plant and equipment 78,120 67,434
Investment property 3,000 4,053
Other assets 13,047 13,232
Equity accounted investment in
joint venture 3,458 635
Deferred tax assets 125 -
Total non-current assets 156,065 135,569
--------------------------------------------- ------------ -------------
Inventories 84,490 74,475
Trade and other receivables 37,105 31,657
Cash and cash equivalents 90,131 64,524
--------------------------------------------- ------------ -------------
Total current assets 211,726 170,656
--------------------------------------------- ------------ -------------
Total assets 367,791 306,225
--------------------------------------------- ------------ -------------
Liabilities
Interest-bearing loans and borrowings (2,874) (2,712)
Trade and other payables (128,445) (115,742)
Provisions (2,591) (2,920)
Income tax liabilities (12,370) (10,789)
--------------------------------------------- ------------ -------------
Total current liabilities (146,280) (132,163)
--------------------------------------------- ------------ -------------
Interest-bearing loans and borrowings (1,117) (1,347)
Other payables (28,782) (24,050)
Provisions (6,437) (7,395)
Deferred tax liabilities - (748)
--------------------------------------------- ------------ -------------
Total non-current liabilities (36,336) (33,540)
--------------------------------------------- ------------ -------------
Total liabilities (182,616) (165,703)
--------------------------------------------- ------------ -------------
Total assets less total liabilities 185,175 140,522
--------------------------------------------- ------------ -------------
Capital and reserves
Issued ordinary share capital 2,433 2,433
Share premium 11,659 11,659
Retained earnings 171,916 125,341
Other reserves (1,918) (244)
Total equity attributable to equity holders
of the parent 184,090 139,189
Non-controlling interest 1,085 1,333
--------------------------------------------- ------------ -------------
Total equity 185,175 140,522
--------------------------------------------- ------------ -------------
Consolidated Statement of Changes in Equity
For the 52 weeks ended 29 January 2011
Total Equity
Foreign Attributable
Ordinary Currency To Equity
Share Share Retained Other Translation Holders Of
Capital Premium Earnings Equity Reserve The Parent
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Balance at 31
January 2009 2,433 11,659 88,378 - 4 102,474
Profit for the
period - - 42,900 - - 42,900
Other
comprehensive
income:
Exchange
differences on
translation of
foreign
operations - - - - (248) (248)
Total other
comprehensive
income - - - - (248) (248)
----------------- --------- -------- --------- -------- ------------ -------------
Total
comprehensive
income for the
period - - 42,900 - (248) 42,652
Dividends to
equity holders - - (5,937) - - (5,937)
Acquisition of
non-controlling
interest - - - - - -
Balance at 30
January 2010 2,433 11,659 125,341 - (244) 139,189
Profit for the
period - - 55,884 - - 55,884
Other
comprehensive
income:
Exchange
differences on
translation of
foreign
operations - - - - 95 95
----------------- --------- -------- --------- -------- ------------ -------------
Total other
comprehensive
income - - - - 95 95
----------------- --------- -------- --------- -------- ------------ -------------
Total
comprehensive
income for the
period - - 55,884 - 95 55,979
Dividends to
equity holders - - (9,002) - - (9,002)
Put options held
by
non-controlling
interests - - - (1,769) - (1,769)
Acquisition of
non-controlling
interest - - (627) - - (627)
Disposal of
non-controlling
interest - - 320 - - 320
----------------- --------- -------- --------- -------- ------------ -------------
Balance at 29
January 2011 2,433 11,659 171,916 (1,769) (149) 184,090
----------------- --------- -------- --------- -------- ------------ -------------
Put options are held by the 49% non-controlling interest in
Canterbury of New Zealand Limited and 25% non-controlling interest
in Canterbury International (Australia) Pty Limited.
Consolidated Statement of Changes in Equity (continued)
For the 52 weeks ended 29 January 2011
Total Equity
Attributable
To Equity
Holders Non-Controlling Total
Of The Parent Interest Equity
GBP000 GBP000 GBP000
Balance at 31 January
2009 102,474 1,295 103,769
Profit for the period 42,900 (154) 42,746
Other comprehensive
income:
Exchange differences
on translation of foreign
operations (248) - (248)
Total other comprehensive
income (248) - (248)
-------------------------------- --------------- ---------------- --------
Total comprehensive
income for the period 42,652 (154) 42,498
Dividends to equity
holders (5,937) - (5,937)
Acquisition of non-controlling
interest - 192 192
Balance at 30 January
2010 139,189 1,333 140,522
Profit for the period 55,884 (17) 55,867
Other comprehensive
income:
Exchange differences
on translation of foreign
operations 95 - 95
-------------------------------- --------------- ---------------- --------
Total other comprehensive
income 95 - 95
-------------------------------- --------------- ---------------- --------
Total comprehensive
income for the period 55,979 (17) 55,962
Dividends to equity
holders (9,002) - (9,002)
Put options held by
non-controlling interests (1,769) - (1,769)
Acquisition of non-controlling
interest (627) (573) (1,200)
Disposal of non-controlling
interest 320 342 662
-------------------------------- --------------- ---------------- --------
Balance at 29 January
2011 184,090 1,085 185,175
-------------------------------- --------------- ---------------- --------
Consolidated Statement of Cash Flows
For the 52 weeks ended 29 January 2011
52 weeks to 52 weeks to
29 January 30 January
2011 2010
GBP000 GBP000
Cash flows from operating activities
Profit for the period 55,867 42,746
Share of results of joint venture (2,823) 473
Income tax expense 22,762 18,647
Financial expenses 455 827
Financial income (618) (385)
Depreciation and amortisation of non-current
assets 20,375 17,863
Exchange differences on translation (158) (49)
Impairment of intangible assets - 2,617
Impairment of non-current assets - 408
Impairment of investment property 1,007 -
Profit on disposal of available for sale
investments - (4,089)
Loss on disposal of non-current assets 1,440 2,148
Increase in inventories (9,622) (6,062)
Increase in trade and other receivables (5,209) (8,179)
Increase in trade and other payables 14,676 25,326
Interest paid (455) (827)
Income taxes paid (22,002) (15,848)
---------------------------------------------- ------------ ------------
Net cash from operating activities 75,695 75,616
---------------------------------------------- ------------ ------------
Cash flows from investing activities
Interest received 618 385
Proceeds from sale of non-current assets 1,082 532
Disposal costs of non-current assets (491) (644)
Acquisition of intangible assets (9,560) (6,672)
Acquisition of property, plant and equipment (30,855) (21,472)
Acquisition of non-current other assets (2,114) (1,429)
Cash consideration of acquisitions - (9,100)
Cash acquired with acquisitions - 2,273
Overdrafts acquired with acquisitions - (1,129)
Acquisition of available for sale investment - (9,990)
Proceeds from disposal of available for
sale investment - 16,132
Third party loan repayments - 80
Loan repayments received from joint venture 923 1,750
Net cash used in investing activities (40,397) (29,284)
---------------------------------------------- ------------ ------------
Cash flows from financing activities
Repayment of interest-bearing loans and
borrowings (310) (1,836)
Acquisition of non-controlling interest (1,200) -
Sale of subsidiary shares to non-controlling
interest 662 -
Dividends paid (9,002) (5,937)
---------------------------------------------- ------------ ------------
Net cash used in financing activities (9,850) (7,773)
---------------------------------------------- ------------ ------------
Net increase in cash and cash equivalents 25,448 38,559
---------------------------------------------- ------------ ------------
Cash and cash equivalents at the beginning
of the period 62,097 23,538
---------------------------------------------- ------------ ------------
Cash and cash equivalents at the end
of the period 87,545 62,097
---------------------------------------------- ------------ ------------
Analysis of Net Cash
As at 29 January 2011
At 30 At 29
January January
2010 Cash flow 2011
GBP000 GBP000 GBP000
Cash at bank and in hand 64,524 25,607 90,131
Overdrafts (2,427) (159) (2,586)
--------------------------- --------- ---------- ---------
Cash and cash equivalents 62,097 25,448 87,545
Interest-bearing loans
and borrowings:
Bank loans (885) 310 (575)
Other loans (747) (83) (830)
--------------------------- --------- ---------- ---------
60,465 25,675 86,140
--------------------------- --------- ---------- ---------
1. Prior period restatement
The comparative Group Consolidated Statement of Financial
Position as at 30 January 2010 has been restated to reflect the
completion in the period to 29 January 2011 of initial accounting
in respect of the acquisition of Kooga Rugby Limited made in the
period to 30 January 2010. Adjustments made to the provisional
calculation of the fair value of assets and liabilities acquired,
as reported at 30 January 2010, in the period to 29 January 2011,
resulted in an increase to goodwill of GBP94,000. The impact of
this adjustment on the net liabilities is shown in note 6. As the
acquisition of Kooga Rugby Limited occurred in the year to 30
January 2010 this adjustment has no impact on the Consolidated
Statement of Financial Position as at 31 January 2009 and so it has
not been presented.
2. Segmental analysis
IFRS 8 'Operating Segments' requires the Group's segments to be
identified on the basis of internal reports about components of the
Group that are regularly reviewed by the Chief Operating Decision
Maker to allocate resources to the segments and to assess their
performance. The Chief Operating Decision Maker is considered to be
the Executive Chairman of JD Sports Fashion Plc.
Information reported to the Chief Operating Decision Maker is
focused on the nature of the businesses within the Group. The
Group's reportable segments under IFRS 8 are therefore as
follows:
-- Sport retail - includes the results of the sport retail
trading companies JD Sports Fashion Plc, John David Sports Fashion
(Ireland) Limited, Chausport SA and Duffer of St George Limited
-- Fashion retail - includes the results of the fashion retail
trading companies Bank Fashion Limited and RD Scott Limited
-- Distribution businesses - includes the results of the
distribution companies Topgrade Sportswear Limited, Nicholas
Deakins Limited, Canterbury Limited (including global subsidiary
companies), Kooga Rugby Limited and Nanny State Limited
The Chief Operating Decision Maker receives and reviews
segmental operating profit. Certain central administrative costs
including Group Directors' salaries are included within the Group's
core 'Sport retail' result. This is consistent with the results as
reported to the Chief Operating Decision Maker.
IFRS 8 requires disclosure of information regarding revenue from
major products and customers. The majority of the Group's revenue
is derived from the retail of a wide range of apparel, footwear and
accessories to the general public. As such, the disclosure of
revenues from major products and customers is not appropriate.
Intersegment transactions are undertaken in the ordinary course
of business on arms length terms.
The Board consider that certain items are cross divisional in
nature and cannot be allocated between the segments on a meaningful
basis. The share of results of joint venture is presented as
unallocated in the following tables, as this entity has trading
relationships with companies in all of the three segments. An asset
of GBP3,458,000 (2010: GBP635,000) for the equity accounted
investment in joint venture is included within the unallocated
segment. Net funding costs and taxation are treated as unallocated
reflecting the nature of the Group's syndicated borrowing
facilities and its tax group. A deferred tax asset of GBP125,000
(2010: liability of GBP748,000) and an income tax liability of
GBP12,370,000 (2010: GBP10,789,000) are included within the
unallocated segment.
Each segment is shown net of intercompany transactions and
balances within that segment. The eliminations remove intercompany
transactions and balances between different segments which
primarily relate to the net down of long term loans and short term
working capital funding provided by JD Sports Fashion Plc (within
Sport retail) to other companies in the Group, and intercompany
trading between companies in different segments.
Business Segments
Information regarding the Group's reportable operating segments
for the 52 weeks to 29 January 2011 is shown below:
Income statement
Sport Fashion
Retail Retail Distribution Total
GBP000 GBP000 GBP000 GBP000
Gross revenue 667,224 134,110 85,498 886,832
Intersegment revenue (1,290) (162) (1,711) (3,163)
-------------------------------- -------- -------- ------------- ---------
Revenue 665,934 133,948 83,787 883,669
-------------------------------- -------- -------- ------------- ---------
Operating profit before
exceptional items 73,340 6,399 188 79,927
Exceptional items (2,687) (1,573) (24) (4,284)
-------------------------------- -------- -------- ------------- ---------
Operating profit 70,653 4,826 164 75,643
Share of results of joint
venture 2,823
Financial income 618
Financial expenses (455)
-------------------------------- -------- -------- ------------- ---------
Profit before tax 78,629
Income tax expense (22,762)
-------------------------------- -------- -------- ------------- ---------
Profit for the period 55,867
-------------------------------- -------- -------- ------------- ---------
Total assets and liabilities
Sport Fashion
Retail Retail Distribution Unallocated Eliminations Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Total assets 310,244 56,182 50,822 3,583 (53,040) 367,791
------------- ---------- --------- -------------- ---------- ------------- -------------
Total
liabilities (120,727) (51,546) (51,013) (12,370) 53,040 (182,616)
------------- ---------- --------- -------------- ---------- ------------- -------------
Other segment information
Sport Fashion
Retail Retail Distribution Total
GBP000 GBP000 GBP000 GBP000
Capital expenditure:
Brand licence purchased 7,500 - - 7,500
Brand names purchased 1,710 - 350 2,060
Property, plant and equipment 23,553 6,656 646 30,855
Non-current other assets 2,092 22 - 2,114
Depreciation, amortisation
and impairments:
Depreciation and amortisation
of non-current assets 15,679 3,454 1,242 20,375
Impairment of investment
property 1,007 - - 1,007
------------------------------- -------- -------- ------------- --------
The comparative segmental results for the 52 weeks to 30 January
2010 are as follows:
Income statement
Sport Fashion
Retail Retail Distribution Total
GBP000 GBP000 GBP000 GBP000
Gross revenue 615,507 114,640 42,551 772,698
Intersegment revenue (1,225) (394) (1,294) (2,913)
-------------------------------- -------- -------- ------------- ---------
Revenue 614,282 114,246 41,257 769,785
-------------------------------- -------- -------- ------------- ---------
Operating profit/(loss) before
exceptional items 64,125 3,333 (164) 67,294
Exceptional items (642) (4,355) 11 (4,986)
-------------------------------- -------- -------- ------------- ---------
Operating profit/(loss) 63,483 (1,022) (153) 62,308
Share of results of joint
venture (473)
Financial income 385
Financial expenses (827)
-------------------------------- -------- -------- ------------- ---------
Profit before tax 61,393
Income tax expense (18,647)
-------------------------------- -------- -------- ------------- ---------
Profit for the period 42,746
-------------------------------- -------- -------- ------------- ---------
Total assets and liabilities
Sport Fashion
Retail Retail Distribution Unallocated Eliminations Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Total assets 264,394 51,180 40,572 635 (50,556) 306,225
------------- ---------- --------- -------------- ---------- ------------- -------------
Total
liabilities (112,618) (51,561) (40,543) (11,537) 50,556 (165,703)
------------- ---------- --------- -------------- ---------- ------------- -------------
Other segment information
Sport Fashion
Retail Retail Distribution Total
GBP000 GBP000 GBP000 GBP000
Capital expenditure:
Goodwill on acquisition
(restated - see note 1) - - 1,537 1,537
Brand names on acquisition 2,042 - 453 2,495
Brand names purchased - - 6,672 6,672
Property, plant and
equipment 13,517 7,383 572 21,472
Non-current other assets 1,424 5 - 1,429
Available for sale
investment 9,990 - - 9,990
---------------------------- --------- -------- ------------- ----------
Depreciation, amortisation
and impairments:
Depreciation and
amortisation of
non-current assets 14,067 3,279 517 17,863
Impairment of intangible
assets - 2,617 - 2,617
Impairment of non-current
assets 105 303 - 408
---------------------------- --------- -------- ------------- ----------
Geographical Information
The Group's operations are located in the UK, Republic of
Ireland, France, Australia, New Zealand, United States of America
and Hong Kong.
The following table provides analysis of the Group's revenue by
geographical market, irrespective of the origin of the
goods/services:
52 weeks to 52 weeks to
29 January 30 January
2011 2010
GBP000 GBP000
UK 801,728 722,221
Europe 55,027 45,094
Rest of world 26,914 2,470
--------------- ------------ ------------
883,669 769,785
--------------- ------------ ------------
The revenue from any individual country, with the exception of
the UK, is not more than 10% of the Group's total revenue.
The following is an analysis of the carrying amount of segmental
non-current assets, excluding the investment in joint venture of
GBP3,458,000 (2010: GBP635,000), deferred tax assets of GBP125,000
(2010: GBPnil) and other financial assets of GBPnil (2010:
GBP922,000), by the geographical area in which the assets are
located:
2010
(restated -
2011 see note 1)
GBP000 GBP000
UK 135,852 120,416
Europe 16,362 13,311
Rest of world 268 285
--------------- -------- -------------
152,482 134,012
--------------- -------- -------------
3. Exceptional items
52 weeks to
29 January 52 weeks to
2011 30 January
GBP000 2010 GBP000
Loss on disposal of non-current assets
(1) 1,440 2,148
Impairment of non-current assets (2) - 408
Onerous lease provision (3) 1,837 3,902
Selling and distribution expenses - exceptional 3,277 6,458
------------------------------------------------- ------------ -------------
Impairment of intangible assets (4) - 2,617
Impairment of investment property (5) 1,007 -
Profit on disposal of available for sale
investments (6) - (4,089)
Administrative expenses - exceptional 1,007 (1,472)
------------------------------------------------- ------------ -------------
4,284 4,986
------------------------------------------------- ------------ -------------
(1) Relates to the excess of net book value of property, plant
and equipment and non-current other assets disposed over proceeds
received
(2) Relates to property, plant and equipment and non-current
other assets in cash-generating units which are loss making, where
it is considered that this position cannot be recovered
(3) Relates to the net movement in the provision for onerous
property leases on trading and non-trading stores
(4) Relates to the impairment in the period to 30 January 2010
of the residual goodwill on the acquisition of the entire issued
share capital of RD Scott Limited
(5) Relates to the impairment in the period to 29 January 2011
of investment property
(6) The Group held a non-strategic investment in JJB Sports Plc
until 9 December 2009 when it disposed of 65,018,098 ordinary
shares for 25p per share, giving a realised loss on disposal of
GBP1,988,000. After recognising an impairment of GBP6,077,000 in
the year ended 31 January 2009 this resulted in an exceptional gain
in the period to 30 January 2010 of GBP4,089,000
4. Interest in joint venture
The Group's share of the revenue generated by the joint venture
in the period was GBP15,418,000(2010: GBP11,774,000). The amount
included in the Consolidated Income Statement in relation to the
joint venture is as follows:
After
Before exceptionals Exceptionals exceptionals
GBP000 GBP000 GBP000
Share of result before
tax 2,102 1,549 3,651
Tax (627) (201) (828)
------------------------- -------------------- ------------- --------------
Share of result after
tax 1,475 1,348 2,823
------------------------- -------------------- ------------- --------------
The comparative amount included in the Consolidated Income
Statement for the period ended 30 January 2010 in relation to the
joint venture is as follows:
After
Before exceptionals Exceptionals exceptionals
GBP000 GBP000 GBP000
Share of result before
tax 740 (1,406) (666)
Tax (201) 394 193
------------------------- -------------------- ------------- --------------
Share of result after
tax 539 (1,012) (473)
------------------------- -------------------- ------------- --------------
The exceptional items in the current year relate to unrealised
gains on foreign exchange contracts and the reversal of the
impairment of the investment held by Focus Brands Limited in Focus
Group Holdings Limited, following repayment of original purchase
consideration by the vendors of Focus Group Holdings Limited. The
exceptional items in the prior year relate entirely to unrealised
losses on foreign exchange contracts.
5. Earnings per ordinary share
Basic and diluted earnings per ordinary share
The calculation of basic and diluted earnings per ordinary share
at 29 January 2011 is based on the profit for the period
attributable to equity holders of the parent of GBP55,884,000
(2010: GBP42,900,000) and a weighted average number of ordinary
shares outstanding during the 52 weeks ended 29 January 2011 of
48,661,658 (2010: 48,661,658).
52 weeks
52 weeks to to
29 January 30 January
2011 2010
Issued ordinary shares at beginning and
end of period 48,661,658 48,661,658
----------------------------------------- ------------ ------------
Adjusted basic and diluted earnings per ordinary share
Adjusted basic and diluted earnings per ordinary share have been
based on the profit for the period attributable to equity holders
of the parent for each financial period but excluding the post-tax
effect of certain exceptional items. The Directors consider that
this gives a more meaningful measure of the underlying performance
of the Group.
52 weeks 52 weeks
to to
29 January 30 January
2011 2010
Note GBP000 GBP000
Profit for the period attributable to
equity holders
of the parent 55,884 42,900
Exceptional items excluding loss on
disposal of non-current assets 3 2,844 2,838
Tax relating to exceptional items (514) (1,184)
Share of exceptional items of joint
venture (net of income tax) 4 (1,348) 1,012
------------------------------------------- ----- ------------ ------------
Profit for the period attributable to
equity holders of the parent excluding
exceptional items 56,866 45,566
------------------------------------------- ----- ------------ ------------
Adjusted basic and diluted earnings per 116.86p 93.64p
ordinary share
------------------------------------------- ----- ------------ ------------
6. Acquisitions
Current period acquisitions
Acquisition of non-controlling interest in Topgrade Sportswear
Limited
On 21 June 2010, the Group acquired a further 29% of the issued
share capital of Hallco 1521 Limited (the intermediate holding
company of Topgrade Sportswear Limited) for a cash consideration of
GBP1,200,000. This takes the Group's holding to 80%. The Group's
original share of 51% was acquired on 7 November 2007. Topgrade
Sportswear Limited is a distributor and multichannel retailer of
sports and fashion clothing and footwear. As the Group already had
control of Hallco 1521 Limited, the increase in Group ownership has
been accounted for as an equity transaction.
Nanny State Limited
On 4 August 2010, the Group (via its new subsidiary Nanny State
Limited) acquired the global rights to the fashion footwear and
apparel brand, 'Nanny State', from D.R.I.P Brands Limited (in
administration) and D.R. Shoes Limited (in administration) for a
cash consideration of GBP350,000. Inventory with a value of
GBP141,000 and other debtors with a value of GBP86,000 were also
acquired. The book value of the assets acquired is considered to be
the fair value.
Included in the result for the 52 week period to 29 January 2011
is revenue of GBP771,000 and a loss before tax of GBP15,000 in
respect of Nanny State Limited.
Prior period acquisitions
Acquisition of Kooga Rugby Limited
On 3 July 2009, the Group acquired 100% of the issued share
capital of Kooga Rugby Limited for a consideration of GBP1 together
with associated fees of GBP30,000. Kooga Rugby Limited is involved
in the design, sourcing and wholesale of rugby apparel, footwear
and accessories and is sole kit supplier to a number of
professional rugby union and rugby league clubs.
During the 12 month period following acquisition, certain
measurement adjustments have been made to the provisional fair
values of the net liabilities of Kooga Rugby Limited as at the
acquisition date in accordance with IFRS 3 'Business Combinations'.
The adjustments from 1 August 2009 to 30 January 2010 are shown in
the Annual Report and Accounts 2010. The adjustments from 31
January 2010 to determine the final fair value of liabilities
acquired are shown below:
Provisional
fair value Fair value
at 30 January Fair value at 29 January
2010 adjustments 2011
GBP000 GBP000 GBP000
Acquiree's net liabilities
at the acquisition date:
Intangible assets 453 - 453
Property, plant and
equipment 102 - 102
Inventories 1,082 (94) 988
Trade and other receivables 1,018 - 1,018
Interest-bearing loans and
borrowings (1,449) - (1,449)
Trade and other payables (2,035) - (2,035)
Provisions (584) - (584)
Net identifiable liabilities (1,413) (94) (1,507)
----------------------------- --------------- ------------- ---------------
Goodwill on acquisition 1,443 94 1,537
----------------------------- --------------- ------------- ---------------
Consideration paid -
satisfied in cash 30 - 30
----------------------------- --------------- ------------- ---------------
Acquisition of Chausport SA
On 19 May 2009, the Group (via its new subsidiary JD Sports
Fashion (France) SAS) acquired 100% of the issued share capital of
Chausport SA for a cash consideration of GBP7,211,000
(EUR8,000,000) together with associated fees of GBP696,000.
Chausport SA is a French retailer, which at the time of acquisition
had 78 stores in premium locations in town centres and shopping
centres across France.
During the 12 month period following acquisition, no measurement
adjustments were made to the provisional fair values of the net
assets of Chausport SA as at the acquisition date.
Provisional
fair value Fair value
at 30 January Fair value at 29 January
2010 adjustments 2011
GBP000 GBP000 GBP000
Acquiree's net assets at the
acquisition date:
Property, plant and
equipment 1,558 - 1,558
Non-current other assets 9,278 - 9,278
Inventories 5,770 - 5,770
Trade and other receivables 1,350 - 1,350
Cash and cash equivalents 639 - 639
Interest-bearing loans and
borrowings (2,318) - (2,318)
Trade and other payables (8,370) - (8,370)
Net identifiable assets 7,907 - 7,907
----------------------------- --------------- ------------- ---------------
Goodwill on acquisition - - -
----------------------------- --------------- ------------- ---------------
Consideration paid -
satisfied in cash 7,907 - 7,907
----------------------------- --------------- ------------- ---------------
Canterbury Limited
On 4 August 2009, the Group (via its new subsidiary Canterbury
Limited) acquired the global rights to the rugby brands
'Canterbury' and 'Canterbury of New Zealand' from Canterbury Europe
Limited (in administration) for a cash consideration of
GBP6,672,000. Inventory with a fair value of GBP4,289,000 was also
acquired. The book value of the assets acquired was considered to
be the fair value and no goodwill arose on the acquisition.
The final fair value of the net assets acquired was
GBP10,961,000. During the 12 month period following acquisition, no
measurement adjustments have been made to the provisional fair
values of the net assets of Canterbury Limited as at the
acquisition date.
Canterbury International (Far East) Limited
On 4 August 2009, Canterbury Limited acquired 100% of the issued
share capital of Canterbury International (Far East) Limited for a
cash consideration of GBP1. The provisional fair value of the
assets and liabilities acquired was GBP1. No goodwill arose on this
acquisition.
The final fair value of the net assets acquired was GBP1. During
the 12 month period following acquisition, no measurement
adjustments have been made to the provisional fair values of the
net assets of Canterbury International (Far East) Limited as at the
acquisition date.
Canterbury (North America) LLC
On 24 November 2009, Canterbury Limited (via its new subsidiary
Canterbury (North America) LLC) acquired the key trading assets
from Sail City Apparel Limited (in liquidation). The total cash
consideration paid was GBP442,000 which included inventory with a
value of GBP392,000 with associated fees of GBP50,000. The book
value of the assets acquired was considered to be the fair value
and no goodwill arose on the acquisition.
The final fair value of the net assets acquired was GBP442,000.
During the 12 month period following acquisition, no measurement
adjustments have been made to the provisional fair values of the
net assets of Canterbury (North America) LLC as at the acquisition
date.
Acquisition of Canterbury International (Australia) Pty
Limited
On 23 December 2009, Canterbury Limited acquired 100% of the
issued share capital of Canterbury International (Australia) Pty
Limited for a cash consideration of GBP2 together with associated
fees of GBP100,000. Canterbury International (Australia) Pty
Limited operates the Canterbury brand in Australia.
During the 12 month period following acquisition, no measurement
adjustments have been made to the provisional fair values of the
net assets of Canterbury International (Australia) Pty Limited as
at the acquisition date.
Provisional
fair value Fair value
at 30 January Fair value at 29 January
2010 adjustments 2011
GBP000 GBP000 GBP000
Acquiree's net assets at the
acquisition date:
Property, plant and
equipment 144 - 144
Inventories 1,866 - 1,866
Trade and other receivables 1,175 - 1,175
Cash and cash equivalents 918 - 918
Trade and other payables (3,386) - (3,386)
Intercompany loan (617) - (617)
Net identifiable assets 100 - 100
----------------------------- --------------- ------------- ---------------
Goodwill on acquisition - - -
----------------------------- --------------- ------------- ---------------
Consideration paid -
satisfied in cash 100 - 100
----------------------------- --------------- ------------- ---------------
Acquisition of Canterbury of New Zealand Limited
On 23 December 2009, Canterbury Limited acquired 51% of the
issued share capital of Canterbury of New Zealand Limited for a
cash consideration of GBP1 together with associated fees of
GBP200,000. Canterbury of New Zealand Limited operates the
Canterbury brand in New Zealand.
During the 12 month period following acquisition, no measurement
adjustments have been made to the provisional fair values of the
net assets of Canterbury of New Zealand Limited as at the
acquisition date.
Provisional
fair value Fair value
at 30 January Fair value at 29 January
2010 adjustments 2011
GBP000 GBP000 GBP000
Acquiree's net assets at the
acquisition date:
Property, plant and
equipment 123 - 123
Inventories 1,501 - 1,501
Trade and other receivables 1,256 - 1,256
Cash and cash equivalents 504 - 504
Trade and other payables (1,450) - (1,450)
Income tax liabilities (8) - (8)
Intercompany loan (771) - (771)
Shareholder loan (763) - (763)
Net identifiable assets 392 - 392
----------------------------- --------------- ------------- ---------------
Non-controlling interest
(49%) (192) - (192)
Goodwill on acquisition - - -
----------------------------- --------------- ------------- ---------------
Consideration paid -
satisfied in cash 200 - 200
----------------------------- --------------- ------------- ---------------
Acquisition of Duffer of St George Limited
On 24 November 2009, the Group acquired 100% of the issued share
capital of Duffer of St George Limited for a cash consideration of
GBP863,000. Duffer of St George Limited owns the global rights to
the brand name 'The Duffer of St George'.
During the 12 month period following acquisition, no measurement
adjustments have been made to the provisional fair values of the
net assets of Duffer of St George Limited as at the acquisition
date.
Provisional
fair value Fair value
at 30 January Fair value at 29 January
2010 adjustments 2011
GBP000 GBP000 GBP000
Acquiree's net assets at the
acquisition date:
Intangible assets 2,042 - 2,042
Trade and other receivables 220 - 220
Cash and cash equivalents 212 - 212
Interest-bearing loans and
borrowings (1,616) - (1,616)
Deferred tax asset 5 - 5
Net identifiable assets 863 - 863
----------------------------- --------------- ------------- ---------------
Goodwill on acquisition - - -
----------------------------- --------------- ------------- ---------------
Consideration paid -
satisfied in cash 863 - 863
----------------------------- --------------- ------------- ---------------
7. Disposals
Disposal of 25% of issued ordinary share capital of Canterbury
International (Australia) Pty Limited
On 28 January 2011, Canterbury Limited disposed of 25% of the
issued ordinary share capital of Canterbury International
(Australia) Pty Limited to the local management team by issuing new
shares in exchange for a cash consideration of AUD $1,100,000. This
takes the Group's shareholding to 75%. As the Group has maintained
control of Canterbury International (Australia) Pty Limited, the
decrease in Group ownership has been accounted for as an equity
transaction.
8. Subsequent events
Acquisition of Kukri Sports Limited
On 7 February 2011, the Group acquired 80% of the issued share
capital of Kukri Sports Limited for a cash consideration of GBP1.
Kukri Sports Limited has a number of subsidiaries around the world,
which source and provide bespoke sports teamwear to schools,
universities and sports clubs. In addition, Kukri Sports Limited is
sole kit supplier to a number of professional sports teams. For the
year ended 30 April 2010, Kukri Sports Limited had a turnover of
GBP12.9 million, an operating loss of GBP0.3 million, a loss before
tax of GBP0.2 million and gross assets of GBP2.5 million. The fair
value of the assets and liabilities acquired is currently being
determined.
Acquisition of additional shares in Focus Brands Limited
On 16 February 2011, the Group acquired a further 31% of the
issued share capital of Focus Brands Limited for a cash
consideration of GBP1,000,000, with potential further deferred
consideration of GBP250,000 depending on performance. The Group's
original share of 49% was acquired on 3 December 2007. Focus Brands
Limited was originally incorporated in order to acquire Focus Group
Holdings Limited and its subsidiary companies and was an entity
jointly controlled by the Group and the former shareholders of
Focus Group Holdings Limited. The additional shares purchased since
the reporting date take the Group's holding in Focus Brands Limited
to 80%, thereby giving the Group control. Focus Brands Limited is
now a subsidiary of the Group rather than a jointly-controlled
entity.
Acquisition of Champion Sports (Holdings)
On 4 April 2011, the Group acquired 100% of the issued share
capital of Champion Sports (Holdings) for a cash consideration of
EUR7 and have also advanced EUR17.1 million to allow it to settle
all of its indebtedness save for EUR2.5 million of leasing finance.
Champion was founded in 1992 and is one of the leading retailers of
sports apparel and footwear in the Republic of Ireland with 22
stores in premium locations in town centres and shopping centres.
In addition, Champion has one store in Northern Ireland. For the
year ended 31 December 2009, Champion had a turnover of EUR54.0
million, an operating loss of EUR1.8 million, a loss before tax of
EUR4.9 million and gross assets of EUR36.2 million. The fair value
of the assets and liabilities acquired is currently being
determined.
New committed bank facility
On 12 April 2011, the Group agreed a new syndicated committed
GBP75,000,000 bank facility for 54 months to 11 October 2015. The
principal terms of this facility are:
-- Current margin 1.25%
-- Arrangement fee 0.60%
-- Commitment fee 45% of applicable margin
The new facility encompasses cross guarantees between the
Company, Bank Fashion Limited, RD Scott Limited, Topgrade
Sportswear Limited, Nicholas Deakins Limited, Canterbury Limited,
Canterbury of New Zealand Limited and Focus International
Limited.
9. Accounts
The financial information set out above does not constitute the
Group's statutory accounts for the 52 weeks ended 29 January 2011
or 30 January 2010 but is derived from those accounts. Statutory
accounts for the 52 weeks ended 30 January 2010 have been delivered
to the Registrar of Companies, and those for the 52 weeks to 29
January 2011 will be delivered in due course. The auditor has
reported on those accounts; their reports were (i) unqualified,
(ii) did not include a reference to any matters to which the
auditors drew attention by way of emphasis without qualifying their
report and (iii) did not contain a statement under section 498 (2)
or (3) of the Companies Act 2006.
Copies of full accounts will be sent to shareholders in due
course. Additional copies will be available from JD Sports Fashion
Plc, Hollinsbrook Way, Pilsworth, Bury, Lancashire, BL9 8RR or
online at www.jdplc.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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