RNS Number:1206U
Angela Flowers Gallery PLC
09 May 2008
Correction to the announcement on 1 May 2008, RNS No. 5875T
There was a typographical error in the Earnings per share shown in the Key
points section of the original announcement
Angela Flowers Gallery PLC
Results for the year ended 31 December 2007
For release
9 May 2008
Key points:
* Buoyant contemporary art market in 2007
* Prospects for 2008 uncertain
* International demand for British artists' work
* Exhibitions by established artists and sculptors as well as promoting
new talent
* Record turnover of #5.90 million (2006, #4.90 million)
* Pre tax profit #107,367 (94% increase on 2006)
* Earnings per share 0.85p (2006, 0.70p)
* Purchase of freehold storage and improved facilities
* new lease at Cork Street
* cash retained (no dividend) strengthening the balance sheet
Enquiries:
Matthew Flowers, Chief Executive Tel: 020 7920 7777
Angela Flowers Gallery PLC
Results for the year ended 31 December 2007
Chairman's statement
Another year of solid progress has placed the gallery, financially and
artistically, in its strongest position to date. As I anticipated a year ago,
turnover, which narrowly failed to reach the #5 million mark in 2006, has now
pushed convincingly forward, to nearly #6 million. At the time of writing, the
uncertainty, stemming from America, that has shrouded business on a global scale
raises inevitable concern. Though the strength of the world market for
contemporary art has been truly remarkable, caution is the only sensible
position for the current year.
The market has altered significantly, however. Leadership in contemporary art is
no longer so clearly located in the United States. Not only have demand and
prices risen strongly in Britain, but British artists have been among the
conspicuous leaders in the salerooms and galleries world-wide, with new records
established for a few living artists. Our own sales of #5.9 million represent an
increase of 18% over the previous year. The cost of sales rose by 23% to #3.2
million, leaving gross profits higher by 13% at #2.7 million.
Administrative expenses rose by 11% to #2.5 million, reflecting the higher costs
associated with expanding sales, but profits grew strongly by 36% at the
operating level and 95% before tax (at #107,367). After a substantially higher
tax charge, profits after interest and tax still showed a commendable rise. The
net came to #58,800, an advance of 54% over the previous year. Earnings per
share gained 21%. However, the company is again not paying a dividend. Your
board feels that the policy of investing for future expansion has been fully
justified and should be continued for the time being.
The acquisition of the virtual freehold at Kingsland Road, Shoreditch, which
brought obvious and major benefits, has now been followed by the freehold
purchase of new storage premises in Theydon Road, Hackney. The end of the lease
on Richmond Road, Hackney (our original investment in the East End's emergence
as a leading centre for contemporary art) made new premises essential, and the
opportunity has been taken to improve the facilities in many ways which will
benefit the Gallery's business.
Our plans for further investment in the West End on an important scale, on which
I reported last year, have made further progress. The expansion and improvement
of the Cork Street premises, initially motivated by the expiry of the lease,
provide the opportunity to create an even stronger operation. The new lease and
the associated building plans were still being finalised as this report was in
progress, but I have every reason to expect that the great success of the Cork
Street premises under the direction of James Ulph will be enhanced.
The balance sheet is healthy, having been improved, not only by the good trading
year, but by the purchase of a substantial stake in the business by Nick Taylor,
an art collector and businessman. He has joined the board as a most welcome
addition. There has been one resignation - Anton Bilton has decided to
concentrate on his many other interests, and we are most grateful to him for the
very positive role he has played in the Gallery's recent progress.
Turning to America, a highly significant feature of 2007 was the excellent
performance on Madison Avenue. Turnover has increased again, this time from $2.1
million to $2.9 million. The New York management has now taken responsibility
for art costs at US art fairs, with an extra member of staff helping the Gallery
director, Emily Flowers, in maintaining the enhanced level of performance. The
range of artists sold in New York has much widened, and the Gallery is well
positioned for further profitable expansion.
While physical investment is highly important, your company's progress and
profitability must rest on the achievements of its artists and the Gallery's
success in selling their work and helping to build their reputations. Our
policy, however, has of late increasingly featured new relationships with
artists whose reputation is already of the highest order. The Gallery's special
status in the art world has made it possible to attract artists of the calibre
of Michael Kidner, William Crozier, Bernard Cohen and Richard Smith. The
enthusiastic critical reception of the work of leading artists of the 1960s was
a notable feature of the market in the past year, and the Gallery has been proud
to support this richly deserved development.
The Gallery itself was born just as the 1960s were ending, and several of its
artists, including Tom Phillips, David Hepher and Patrick Hughes, had come into
prominence at that time. As the sustained and brilliant success of Hughes shows,
these artists have been able to build on very strong foundations. We have also
continued to search for and exhibit young artists. Every intervening decade has
produced new painters and sculptors whose work the Gallery regularly exhibits;
for example, Tim Lewis, Boyd and Evans, Lucy Jones, John Keane, and Tai-Shan
Schierenberg, all of whom have staged memorable recent shows, in the galleries
or outside,
Spotting new talent remains vital. One approach is to organize curated shows,
like the photography exhibition staged by Di Poole, and the array of new artists
chosen by Sam Chatterton-Dickson, that serve the purpose of broadening our
position in the British and international art scenes. Diversification is partly
served by the graphics business, a profitable and highly respected part of the
Shoreditch operation; we also published excellent books and prints during the
year. However, it was decided to discontinue State of Art, the periodical which
plainly filled a gap in the market. Despite its excellence, we decided to
concentrate resources at a time when so many keyprojects are in hand.
I am saddened to report the deaths of two fine artists who have long been
associated with the Gallery, Noel Forster and Edward Dutkiewicz. Their passing
came as a personal blow, for ours is an organization built on personal
relationships, with the artists above all. Their efforts needed the backing of
many others; the directors, the professional advisers, the shareholders and, of
course, all the staff. Their talent and application to their crucial tasks are
invaluable as ever, and I believe that I speak for the management and the
investors in thanking all staff most sincerely for their excellent
contributions.
Those efforts generated the good results I am able to report. As for future
financial forecasts, the usual volatility of this market always advises caution.
The global uncertainty adds new threats. So far I see no reason to revise a
reasonably hopeful prognosis for further performance in 2008. That will not be
won easily, but so far remains within reach.
Angela Flowers
Chairman
ANGELA FLOWERS GALLERY PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 DECEMBER 2007
2007 2006
Notes # # # #
TURNOVER 5,899,318 4,990,202
Cost of sales 3,176,070 2,576,299
--------- ---------
GROSS PROFIT 2,723,248 2,413,903
Administrative expenses 2,499,837 2,250,160
--------- ---------
223,411 163,743
Other operating income 2,000 2,000
--------- --------
OPERATING PROFIT 225,411 165,743
Income from interest in associated
undertakings 4,000 4,000
Interest receivable and similar
income 899 893
------ -----
4,899 4,893
------- -------
230,310 170,636
Interest payable and similar
charges 122,943 115,471
------- -------
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 107,367 55,165
Tax on profit on ordinary
activities 48,522 16,864
------- -------
PROFIT FOR THE FINANCIAL YEAR
AFTER TAXATION 58,845 38,301
======= =======
Earnings per share expressed
in pence per share: 1
Basic 0.85p 0.70p
Diluted 0.84p 0.70p
===== =====
No dividend is payable in respect of the year (2006, #nil)
CONTINUING OPERATIONS
None of the group's activities were acquired or discontinued during the current
year or previous year.
TOTAL RECOGNISED GAINS AND LOSSES
The group has no recognised gains or losses other than the profits for the
current year or previous year.
ANGELA FLOWERS GALLERY PLC
CONSOLIDATED BALANCE SHEET
31 DECEMBER 2007
2007 2006
# # # #
FIXED ASSETS
Intangible assets 60,249 69,555
Tangible assets 3,002,291 2,526,677
Investments 2 2
--------- ---------
3,062,542 2,596,234
CURRENT ASSETS
Stocks 1,859,109 1,846,669
Debtors 1,512,883 1,240,017
Cash at bank and in hand 579,063 293,095
--------- ---------
3,951,055 3,379,781
CREDITORS
Amounts falling due within one year 1,834,259 1,802,795
--------- ---------
NET CURRENT ASSETS 2,116,796 1,576,986
--------- ---------
TOTAL ASSETS LESS CURRENT
LIABILITIES 5,179,338 4,173,220
CREDITORS
Amounts falling due after more than
one year (1,902,988) (1,461,454)
PROVISIONS FOR LIABILITIES (40,616) (34,876)
--------- ---------
NET ASSETS 3,235,734 2,676,890
========= =========
CAPITAL AND RESERVES
Called up share capital 1,043,093 815,821
Share premium 1,421,006 1,148,279
Capital reserves 1,906 1,906
Profit and loss account 769,729 710,884
--------- ---------
SHAREHOLDERS' FUNDS 3,235,734 2,676,890
========= =========
ANGELA FLOWERS GALLERY PLC
CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2007
2007 2006
# #
Net cash inflow
from operating activities 22,170 516,163
Returns on investments and
servicing of finance (118,044) (110,578)
Taxation (20,558) (22,131)
Capital expenditure (542,834) (19,598)
------- ------
(659,266) 363,856
Financing 945,234 (79,989)
------- -------
Increase in cash in the period 285,968 283,867
======= =======
Reconciliation of net cash flow
to movement in net debt
Increase in cash in the period 285,968 283,867
Cash (inflow)/outflow
from (increase)/decrease in debt (445,235) 79,989
------- -------
Change in net debt resulting
from cash flows (159,267) 363,856
Foreign currency translation - (1,950)
------- -------
Movement in net debt in the period (159,267) 361,906
Net debt at 1 January (1,255,389) (1,617,295)
--------- ---------
Net debt at 31 December (1,414,656) (1,255,389)
========= =========
Note 1. EARNINGS PER SHARE
Basic earnings per share of 85p (2006 70p) is calculated by dividing the
earnings attributable to ordinary shareholders of #58,845 (2006 #38,301) by the
weighted average number of ordinary shares outstanding during the period of
6,953,948 (2006 5,438,796).
Diluted earnings per share of 84p (2006 70p) is calculated using the weighted
average number of shares adjusted to assume the conversion of all dilutive
potential ordinary shares of 7,005,948 (2006 5,490,796).
The summarised accounts shown above do not constitute full accounts and have
been extracted from the audited statutory accounts of Angela Flowers Gallery PLC
for the year ended 31 December 2007. The statutory accounts for the year ended
31 December 2007 have been audited by Daniel Auerbach & Co, Chartered
Accountants, whose report thereon was unqualified. The persons responsible for
this announcement are the directors of Angela Flowers Gallery PLC
This information is provided by RNS
The company news service from the London Stock Exchange
END
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