TIDMBES
Blavod Extreme Spirits PLC
3 June 2009
Preliminary Results
Blavod Extreme Spirits plc (the "Company"), the owner of the Blavod
Black Vodka brand, and wines and spirits distributor, announces its
unaudited preliminary results for the year ended 31 March 2009.
Financial highlights
* Profit before tax from continuing activities of GBP185k (2008: GBP155k
loss)
* Revenue up 45% to GBP 5.96m (2008: GBP4.09m)
* Balance sheet restructured giving a positive balance on the group
P&L reserves of GBP89k
Commenting on the results, Richard Ambler, Managing Director, said:
"A good year: our first in profit which is a big turnaround from last
year. We are optimistic about the future."
For further information, please contact:
Blavod Extreme Spirits plc Tel: 0207 352 2096
Richard Ambler
Brewin Dolphin Investment Banking Tel: 0845 213 4726
Neil Baldwin
Chairman's statement
The Company had a good year, making an operating profit for the first
time. Top line growth came from increased sales of all our major
brands, with a significant contribution from recently-added brands.
The brands owned or licensed by the Company grew by 30% of which
Blavod accounted for 7%.
The UK market was particularly strong for us. Our portfolio of
reasonably-priced brands, each with its own distinct personality,
appears to be well-positioned to survive and to grow in this
recession. Also, the additional brands not only add sales but also
give us access to retail outlets where we can introduce the wider
portfolio.
On the other hand, export markets have proven more difficult, and
more uncertain. Exports grew by 5% over the previous year; the US
market continues to retract as wholesalers and retailers reduce
inventory, and the duty free business, which had been doing well for
Blavod during the first six months of the year, fell off sharply in
recent months. However, distribution has improved, and export remains
a long-term opportunity.
Margins have been hurt by the effect of the sharp fall in the pound
on the cost of some imports, the creeping increases in production
costs and the great difficulty of raising prices.
As shareholders will recall, we took measures to cut costs
significantly between 2007 and 2008. We have maintained our overheads
at roughly the same level of 2008, despite the increased throughput.
We have been able to finance both the growth of the business and the
staged acquisition of the licence for Blackwoods of GBP600,000 plus
legal fees (the last tranche of GBP100,000 having been paid in April
2009) by an effective invoice discounting finance facility and tight
cash management.
The first two months of the new financial year have continued to show
growth, and the Directors are confident in the prospects of the
Company and the strength of the brands. In particular, we now have a
proven track record of success with new brands, and believe we are
well-placed to add a small number to our portfolio. As the
marketplace continues to change, further such opportunities should
arise.
However the new year does bring its own set of challenges, among
which are the following;
=- margin pressures are unlikely to be relieved in the foreseeable
future;
=- it is unclear when the US, Russian and Duty Free markets will
start to recover;
=- the organisation has been stretched by an 80% increase in
turnover in two years and the addition of Blackwood's Gin and Jago's
Cream liqueur brands and the EPM brand portfolio. We will need to add
a small number of people in sales and the back office to cater for
this increased level of activity, and this will increase overheads;
=- the considerable growth of the business requires financing but
with the high quality of our debtors and a strong cash flow we
believe that this can be achieved without the need to call on
shareholders for further equity funds.
Amortisation of the Blavod Trade Mark
Historically the Company has included in its accounts annually a sum
for the amortisation of the Blavod name. GBP53,000 has been written off
in 2008/9. The Company intends to review this policy during the year.
Dividends
The Company does not propose to pay a dividend.
Change of Name
The Company proposes changing its name to Blavod Wines and Spirits
PLC - which will be proposed to shareholders at the forthcoming
Annual General Meeting. It is intended that the Company will retain
its AIM "ticker" of "BES" if this change is approved.
Annual General Meeting
This is expected to take place on 23 July 2009. Details will be
contained in the Notice of Meeting which will accompany the Report
and Accounts.
Consolidated income statement - Unaudited
2009 2008
Note GBP'000 GBP'000
Revenue 5,955 4,092
Cost of sales (4,622) (3,091)
Gross profit 1,333 1,001
Administrative costs (1,151) (1,166)
Operating profit/(loss) 182 (165)
Finance income 3 10
Finance income 3 10
Profit/(loss)before tax from continuing
operations 185 (155)
Income tax expense - -
Profit/(loss) for the year from continuing
operations 185 (155)
Profit/(loss) from discontinued operations - 1,238
Profit for the year 185 1,083
Earnings per share:
From continuing operations
Basic (pence per share) 2 0.21 (0.20)
Diluted (pence per share) 2 0.21 (0.20)
From total profit/(loss)
Basic (pence per share) 2 0.21 1.40
Diluted (pence per share) 2 0.21 1.40
Consolidated statement of recognised income and expense - unaudited
2009 2008
GBP'000 GBP'000
Profit for the year 185 1,083
Total recognised income and expense for year 185 1,083
Consolidated balance sheet - Unaudited
Consolidated Balance Sheet
2009 2008
GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant and equipment 10 1
Intangible assets 1,259 615
1,269 616
Current assets
Inventories 452 220
Trade and other receivables 1,724 1,057
Cash and cash equivalents 52 502
Total current assets 2,228 1,779
Total assets 3,497 2,395
LIABILITIES
Current liabilities
Trade and other payables 1,084 929
Finance facility liability 745 -
1,829 929
Non current liabilities
Total liabilities 1,829 929
Net assets 1,668 1,466
EQUITY
Equity attributable to equity holders of the parent
Share capital 878 878
Share premium account - 18,489
Shares to be issued 701 682
Profit and loss account 89 (18,583)
Total equity 1,668 1,466
Consolidated cash flow - Unaudited
2009 2008
GBP'000 GBP'000
Cashflows from operating activities
Profit / (loss) after taxation 185 1,083
Adjustments for :
- depreciation 3 32
- amortisation 60 54
- share-based payment 19 27
- net foreign exchange gain / (loss) (18) (66)
- disposal of US operations - (2,274)
- finance income / (expense) (3) (10)
246 (1,154)
Movements in working capital
- decrease / (increase) in inventories (232) 1,523
- decrease / (increase) in trade receivables (667) 524
- increase / (decrease) in trade payables 65 (1,335)
Cash used by operations (834) 712
Finance expense - (79)
Net cash used in operating activities (588) (521)
Cash flows from investing activities
- interest received 3 10
- proceeds from sale of subsidiary & associate - 220
- purchase of PPE (13) -
- expenditure relating to trade mark registration (597) (3)
Net cash used in investing activities (607) 227
Cash flows from financing activities
- proceeds from issue of share capital - 395
- net cash received from finance facility 745 -
Net cash received from financing activities 745 395
Net increase/(decrease) in cash and cash equivalents (450) 101
Cash & cash equivalents at start of year 502 401
Cash & cash equivalents at end of year 52 502
1 Basis of preparation
The financial information set out above does not constitute the
Company's statutory accounts within the meaning of section 240 of the
Companies Act 1985. The 2009 figures are based on unaudited accounts
for the year ended 31 March 2009.
The unaudited preliminary announcement has been prepared on the basis
of the accounting policies set out in the Group's statutory accounts
for 2008.
The 2008 comparatives are derived from the statutory accounts for
2008 which have been delivered to the Registrar of Companies and
received an unqualified audit report and did not contain a statement
under the Companies Act 1985, s237(2) or (3).
2 Earnings per share
The calculation of the basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the year.
The diluted earnings/(loss) per share is identical to the basic
earnings/(loss) per share as the exercise of warrants and options
would be anti-dilutive as the market value of shares is less than the
exercise price of the warrants and options granted.
Reconciliations of the earnings and weighted average number of shares
used in the calculations are set out below.
2009 2008
Continuing operations
Profit/(loss) attributable to ordinary 185 (155)
shareholders (GBP'000)
Weighted average number of shares (used for
basic earnings per share) 87,758,508 77,405,809
Basic and diluted earnings/(loss) per share 0.21 (0.20)
(pence)
Discontinued operations
Profit attributable to ordinary shareholders - 1,238
(GBP'000)
Weighted average number of shares (used for
basic earnings per share) 87,758,508 77,405,809
Basic and diluted earnings/(loss) per share - 1.60
(pence)
Total operations
Profit attributable to ordinary shareholders 185 1,083
(GBP'000)
Weighted average number of shares (used for
basic earnings per share) 87,758,508 77,405,809
Basic and diluted earnings/(loss) per share 0.21 1.40
(pence)
3. Annual report
Copies of the published accounts of the Company will be sent to all
shareholders on or around 18 June 2009 and will be available from
that date from the offices of Brewin Dolphin, 34 Lisbon Street,
Leeds, LS1 4LX and will be located on:
http://www.blavodextreme.com/investors/accounts.htm
ENDS
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