TIDMBEST
RNS Number : 2716W
Best of the Best PLC
27 January 2012
Best of the Best plc
("Best of the Best" or "the Company")
Interim results for the six months ended 31 October 2011.
Best of the Best plc displays luxury cars as competition prizes within retail locations and online.
Key points
-- Revenue from continuing operations increased 11.2 per cent to GBP2.67 million (2010: GBP2.41 million)
-- Loss before tax from continuing operations GBP0.12 million (2010 profit: GBP0.17 million)
-- Current cash balance of GBP1.1 million
-- Net Assets of GBP4.08 million (2010: GBP4.24 million)
-- Extended trials at shopping centres on going, with three new site openings planned imminently
-- Airport refurbishments continue with new lightweight, flexible stand designs
-- Encouraging trends in acquisition, conversion and frequency of online players
-- Tender Offer completed in November 2011, resulting in GBP1.18m being returned to shareholders
William Hindmarch, Chief Executive, said:
"Although it is disappointing to report a loss in the first half of the financial year, as the business continues to adjust to the impact of the loss of BAA contracts, I am pleased with the overall progress we have made. We have experienced encouraging trading from our three trial shopping centre sites, and we have a further three sites due to commence trading in the next two months.
The Company has taken considerable steps to reduce the overhead of the business in line with its reduced income, in order to restore profitability following the loss of five BAA contracts, and will benefit from the increased revenues from its new site openings. Following the tender offer in November 2011, the balance sheet remains strong with a cash balance in excess of GBP1.1 million, and the Company is well placed to take advantage of opportunities to open new physical locations and invest in the online business."
Enquiries:
Best of the Best plc William Hindmarch, Chief T: 020 7371
Executive 8866
Rupert Garton, Commercial
Director
Biddicks Zoe Biddick T: 020 3178
6378
Charles Stanley Securities Mark Taylor T: 0207 149
(Nominated Adviser) Luke Webster 6000
Please visit www.botb.com for further information
Chief Executive's Statement
Although it is disappointing to report a loss in the first half of the financial year, as the business continues to adjust to the impact of the loss of BAA contracts and the significant reduction in revenues, I am pleased with the overall progress we made. We have experienced encouraging trading from our three trial shopping centre sites, and we have plans to extend the trials to three further sites in the coming months.
The airport business has traded steadily throughout the first half, and offline revenues have been bolstered by income from the three shopping centre sites. We are encouraged by the diversification of our offline revenues, a trend which we expect will continue in the future.
The online business which accounted for some 35 per cent of total revenues in the period continues to perform well, with positive trends in the acquisition, conversion and engagement of players. The results of additional competition categories have been promising and new daily competitions have recently been introduced.
Results
Revenue from continuing operations for the six months ended 31 October 2011 increased by 11.2 per cent to GBP2.67 million (2010: GBP2.41 million). The Company recorded a loss before tax from continuing operations for the period of GBP0.12 million (2010 profit: GBP0.17 million).
The Company has taken considerable steps to reduce the overhead of the business in line with its reduced income, in order to restore profitability following the loss of five BAA contracts (which represented 48 per cent of airport income in the prior period), and will benefit from the increased revenues from its new site openings.
The cash position of the Company at the balance sheet date was GBP2.37 million (2010: GBP2.65 million), with inventory of prizes on display reduced to GBP1.10 million (2010: GBP1.7 million). Our net assets which principally comprise cash, our stock of cars on display (held at net realisable value) and our 997 year leasehold office property stood at GBP4.08 million (2010: GBP4.24 million). Following the Tender Offer and subsequent repurchase of shares in November 2011 (resulting in GBP1.18m being returned to shareholders), cash balances have reduced but currently remain in excess of GBP1.1 million.
Dividend
The Board is not recommending the payment of an interim dividend; however it is the intention of the Directors to maintain a progressive dividend policy and it will continue to review the payment of a dividend for the full financial year ending 30 April 2012.
Business at physical locations
The Company is currently trading from 10 airport sites, and three sites in shopping centres. Airport locations include Gatwick North and South, Stansted, Luton, Birmingham, Manchester Terminals 1 and 2, Edinburgh, Copenhagen and Dublin's Terminal 2. Shopping centre locations include Westfield Shepherds Bush, Westfield Stratford, and Lakeside.
The physical sites have traded steadily throughout the first half, with like-for-like sales showing an increase of 3.2 per cent, and an overall increase for continuing operations of 20.2 per cent, compared to the same period in the prior financial year. Following the restructuring of the Supercar Competition and introduction of new categories of prize and price points, revenues from physical sites have been bolstered by income from the three trial shopping centre sites, which accounted for 22.1 per cent of offline sales in December 2011.
During February and March 2012, the Company will be opening three further shopping centre sites, at Westfield Merry Hill, Bluewater and Westfield Derby, further building upon and diversifying our non-airport revenues, and raising our exposure and the profile of our brand away from airports. We have devised a lightweight, attractive and efficient stand design for our shopping centre outlets, which is less capital intensive, quicker to install and more flexible, allowing us to take full advantage of the opportunities afforded to us by these locations. Furthermore, the cars on display at these sites tend to be from the second and third tiers of our Supercar Competition, which absorb significantly less working capital but continue to be well received by customers and the shopping centres.
We will be incorporating aspects of these more lightweight, stands as we continue our programme of refurbishment, which will see our stands at Gatwick North, Stansted and Birmingham being replaced and refitted over the coming weeks, and reduced to single car sites.
The Company is in discussions to take a further site at Dublin Airport in Terminal 1, and a number of additional UK shopping centres have been identified at which we will seek further locations during 2012.
Online Business
Online sales accounted for 35 per cent of total revenue in the period and were broadly flat compared the same period last year. One of the consequences of losing the five BAA contracts was an immediate reduction in new player registrations, and we are pleased that revenues have not slipped whilst we have been taking the necessary steps to increase registrations from new sites, improve conversion of players from physical locations to online, and grow the number of customers acquired through online channels.
As previously mentioned we restructured the main supercar competition to include three entry points (GBP25, GBP10 and GBP5) and a range of new cars. The results of these new categories have been promising and we have added daily competitions to the recently introduced luxury watch, designer handbag and tech competitions. There is now a selection of at least 10 competitions for players to choose from, with daily prizes and prices from 50 pence to GBP25, giving our website a wider appeal and aiding customer acquisition.
Our average order value has decreased as the new lower priced competitions and categories have been introduced, but this has been more than offset by the number of transactions that we are processing on a monthly basis, which has increased by 58.7 per cent over the same period in the prior year. We are confident that in the long term these trends will result in a more stable, engaged and loyal customer base. The online team continue to work on a wide range of marketing initiatives, with a particular focus on social networks and marketing partnerships to build online registrations and revenue in the future.
Outlook
2011 was a difficult year as the Company adjusted to significantly reduced revenues, sought to rebuild the number of physical locations, and restructured its competitions. Good progress has been made and the Company will benefit in the second half of the year from reductions in central overhead and increased revenues, both from new site openings and the online business. Following the tender offer in November 2011, the balance sheet remains strong with a cash balance in excess of GBP1.1 million, and the Company is well placed to take advantage of opportunities to open new physical locations and invest in the online business.
I look forward to updating shareholders in due course.
William Hindmarch
Chief Executive
27 January 2012
BEST OF THE BEST PLC
Unaudited interim financial statements for the six months ended 31(st) October 2011
Report of the independent auditors
Independent review report to Best of the Best Plc
Introduction
We have been instructed by the Company to review the financial information for the six months ended 31(st) October 2011 which comprises the consolidated statement of comprehensive income, consolidated statement of financial position as at 31(st) October 2011, consolidated cash flow statement, consolidated statement of changes in equity, comparative figures and associated notes.
We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information.
This report is made solely to the Company in accordance with guidance contained in ISRE (UK and Ireland) 2410, "Review of Interim Financial Information performed by the Independent Auditor of the Entity". Our review work has been undertaken so that we might state to the Company those matters we are required to sate to them in a review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusion we have formed.
Directors' responsibilities
The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the Directors. The Directors are responsible for preparing the interim report in accordance with the rules of the London Stock Exchange for companies trading securities on the Alternative Investment Market which require that the half yearly report be presented and prepared in a form consistent with that which will be adopted in the Company's annual accounts having regard to the accounting standards applicable to such annual accounts.
As disclosed in note 6, the annual financial statements of the group are prepared in accordance with IFRS's as adopted by the European Union. The condensed set of financial statements included in this interim report has been prepared in accordance with the International Accounting Standard 34 "Interim Financial Reporting", as adopted by the European Union.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the interim report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the interim report for the six months ended 31(st) October 2011 is not prepared, in all material, respects, in accordance with International Accounting Standard 34 as adopted the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
Wilkins Kennedy
Chartered Accountants
Statutory Auditors
Bridge House
London Bridge
London, SE1 9QR
27 January 2012
BEST OF THE BEST PLC
Unaudited Consolidated Statement of Comprehensive Income
For The Period Ended 31 October 2011
____________________________________________________________________________________________________
Six Months Six Months
Ended Ended Year Ended
31/10/11 31/10/10 30/04/11
Unaudited Unaudited Audited
Notes GBP GBP GBP
000's 000's 000's
CONTINUING OPERATIONS
Revenue 1,2 2,677 2,408 4,736
Cost of sales (1,006) (938) (1,922)
GROSS PROFIT 1,671 1,470 2,814
Administrative expenses (1,800) (1,311) (2,765)
OPERATING (LOSS) / PROFIT (129) 159 49
Finance income 14 9 25
(LOSS) / PROFIT BEFORE
TAX (115) 168 74
Tax 7 49 (66) (17)
(LOSS) / PROFIT FOR THE
PERIOD FROM CONTINUING
OPERATIONS (66) 102 57
(Loss)/Profit for the period
on discontinuing operations 3 - (12) 75
(LOSS) / PROFIT FOR THE
PERIOD (66) 90 132
Earnings Per Share expressed
in pence per share:
Basic 4 (0.60) 0.72 1.13
Diluted 4 (0.59) 0.71 1.11
Discontinuing operations
Basic 4 - (0.10) 0.65
Diluted 4 - (0.10) 0.63
BEST OF THE BEST PLC
Unaudited Consolidated Statement of Financial Position
For The Period Ended 31 October 2011
_____________________________________________________________________________________________________
Six Months Six Months
Ended Ended Year Ended
31/10/11 31/10/10 30/04/11
Unaudited Unaudited Audited
Notes GBP GBP GBP
000's 000's 000's
ASSETS
NON-CURRENT ASSETS
Property, plant and equipment 886 926 833
Deferred tax 123 12 124
________ ________ ________
1,009 938 957
________ ________ ________
CURRENT ASSETS
Inventories 1,081 1,699 1,275
Trade and other receivables 299 132 171
Cash and cash equivalents 2,372 2,647 2,744
________ ________ ________
3,752 4,478 4,190
________ ________ ________
TOTAL ASSETS 4,761 5,416 5,147
________ ________ ________
EQUITY
SHAREHOLDERS' EQUITY
Called up share capital 5 542 548 548
Share premium 1,783 1,783 1,783
Capital redemption reserve 5 87 87 87
Share-based payment reserve 1,5 148 148 148
Retained earnings 1,518 1,673 1,716
TOTAL EQUITY 4,078 4,239 4,282
________ ________ ________
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 569 789 700
Tax payable 114 388 165
________ ________ ________
683 1,177 865
________ ________ ________
TOTAL LIABILITIES 683 1,177 865
TOTAL EQUITY AND LIABILITIES 4,761 5,416 5,147
________ ________ ________
BEST OF THE BEST PLC
Unaudited Consolidated Cash Flow Statement
For The Period Ended 31 October 2011
_____________________________________________________________________________________________________
Six Months Six Months
Ended Ended Year Ended
31/10/11 31/10/10 30/04/11
Unaudited Unaudited Audited
Notes GBP GBP GBP
000's 000's 000's
Cash flows from operating
activities
Cash generated from operations (87) 762 474
Tax paid - - (126)
Net cash from operating
activities (87) 762 348
Cash flows from investing
activities
Purchase of tangible fixed
assets (161) (283) (314)
Sale of tangible fixed - - -
assets
Impairment losses - - 527
Interest received 14 9 24
Net cash from investing
activities (147) (274) 237
Cash flows from financing
activities
Purchase of own shares
held in treasury (7) - -
Equity dividends paid (131) (131) (131)
Net cash from financing
activities (138) (131) (131)
(Decrease)/Increase in
cash and cash equivalents (372) 357 454
Cash and cash equivalents
at beginning of period 2,744 2,290 2,290
Cash and cash equivalents
at end of period 2,372 2,647 2,744
BEST OF THE BEST PLC
Unaudited Consolidated Interim Statement of Changes in Equity
for the period ended 31 October 2011
Called up Retained
share capital earnings Share premium
GBP'000 GBP'000 GBP'000
Balance at 1 May 2010 635 1,715 1,783
Changes in equity
Redemption of share capital (87) - -
Dividends - (131) -
Total comprehensive income - 131 -
________ ________ ________
Balance at 30 April 2011 548 1,715 1,783
Changes in equity
Purchase of own shares held
in treasury (6) - -
Dividends - (131) -
Total comprehensive income - (66) -
________ ________ ________
Balance at 31 October 2011 542 1,518 1,783
________ ________ ________
Capital redemption Share based
reserve payment
reserve Total equity
GBP'000 GBP'000 GBP'000
Balance at 1 May 2010 - 148 4,281
Changes in equity
Redemption of share capital - - (87)
Dividends - - (131)
Total comprehensive income 87 - 218
________ ________ ________
Balance at 30 April 2011 87 148 4,281
Changes in equity
Purchase of own shares held
in treasury - - (6)
Dividends - - (131)
Total comprehensive income - - (66)
________ ________ ________
Balance at 31 October 2011 87 148 4,078
________ ________ ________
BEST OF THE BEST PLC
Notes to the Interim Financial Statements
for the period ended 31 October 2011
1. Basis of preparation
These condensed interim financial statements are for the
six months ended 31(st) October 2011. They have been prepared
with regard to the requirements of International Financial
Reporting Standards as adopted by the EU. They do not include
all of the information required for full financial statements,
and should be read in conjunction with the financial statements
(under IFRS) of the Group for the year ended 30(th) April
2011.
The group is listed on the Alternative Investment Market
("AIM") of the London Stock Exchange and has prepared the
interim financial statements in accordance with AIM rule
18. The group has elected not to adopt the full scope of
IAS 34 'Interim Financial Reports', which is a voluntary
requirement.
The financial statements have been prepared under the historical
cost convention. Principal accounting policies adopted are
consistent with those of the annual financial statements
for the year ended 30(th) April 2011.
Significant accounting policies include;
Revenue recognition
Revenue represents the value of tickets sold in respect
of competitions which have been completed at the accounting
date. A competition is completed when the Group closes entries.
Share based payment
The Company has applied the requirements of IFRS 2 to share
option schemes allowing certain employees within the Company
to acquire shares of the Company. For all grants of share
options, the fair value as at the date of grant, is calculated
using the Black-Scholes options pricing model, taking into
account the terms and conditions upon which the options
were granted. The amount recognised as an expense is adjusted
to reflect the number of share options that are likely to
vest, except where forfeiture is only due to market based
conditions not achieving the threshold for vesting. The
expense is recognised over the expected life of the option.
2. Segment analysis
The Directors consider that the primary reporting format
is by business segment and that there is only one such segment
being that of competition operators. This disclosure has
already been provided in these financial statements.
IFRS8 "Operating Segments", which came into effect not later
than accounting periods beginning on 1 January 2009, requires
identification and reporting of operating segments on the
basis of internal reports that are regularly reviewed by
the Board in order to allocate resources to the segment
and assess its performance. The Company assessed the impact
of IFRS8 and concluded that it would not impact the segments
identified in this interim report.
3. Discontinued operations
Period 01/05/10 to 31/10/10 Year ended 30/04/11
Continuing Discontinuing Total Continuing Discontinuing Total
Result Result
of of
termination termination
GBP'000's GBP'000's GBP'000's GBP'000's GBP'000's GBP'000's GBP'000's GBP'000's
Turnover 2,408 1,314 - 3,722 4,737 1,831 - 6,568
Cost of
sales (938) (534) - (1,472) (1,922) (701) - (2,623)
Admin
expenses (1,311) (744) (615) (2,670) (2,766) (1,137) (645) (4,548)
Other
income 9 - 750 759 25 - 750 775
________ ________ ______ ______ ________ ________ ______ ______
Profit
before
tax 168 36 135 339 74 (7) 105 172
Tax (66) (10) (173) (249) (17) 2 (25) (40)
________ ________ ______ ______ ________ ________ ______ ______
Profit/(Loss)
for the
period 102 26 (38) 90 57 (5) 80 132
As per the release dated 11th October 2010, BAA Airports Limited
terminated a majority of the on-going concession agreements
with Best of the Best Plc. As a result, Best of the Best Plc
received a termination payment of GBP750,000. This is included
within other discontinued income.
Associated costs with regards to the closure of the BAA sites
included an asset impairment provision of GBP520,209 and additional
wages and legal costs of GBP94,544, all included within discontinued
admin expenses.
4. Earnings per share
Basic earnings per share is calculated by dividing the profit
for the relevant financial period attributable to ordinary
equity holders of the entity by the weighted average number
of ordinary shares in issue during the relevant financial periods.
The weighted average number of equity shares in issue is 10,968,254
(31(st) October 2010: 12,426,587; 30(th) April 2011: 11,697,421).
The earnings, being the loss after tax, are GBP66,154 (31(st)
October 2010: profit of GBP89,945; 30(th) April 2011: profit
of GBP132,276).
Diluted earnings per share is calculated by adjusting earnings
and weighted average number of ordinary shares outstanding
to assume conversion of dilutive potential ordinary shares.
Potential ordinary shares shall be treated as dilutive when,
and only when, their conversion to ordinary shares would decrease
earnings per share or increase loss per share from continuing
operations. The effect of dilutive securities for the period
is to increase the weighted average number of shares by 260,816
shares (31(st) October 2010: 260,816; 30(th) April 2011: 248,987).
5. Statement of changes in equity
The share based payment reserve reflects the charge for the
period in relation to share options granted during the period.
The Company will continue to accrue these costs at the same
rate until the vesting period is over. Rupert Garton, Commercial
Director, exercised 266,146 options in the Company at a price
of 5 pence per share on 10(th) November 2011. At the date of
this report, Mr Garton owns 721,765 Ordinary shares, representing
6.42 per cent of the issued Ordinary share capital of the Company.
On 8(th) September 2011, the Company purchased 34,500 of its
own shares at a price of 19 pence per share. These Ordinary
shares are currently held by the Company in treasury and do
not carry any voting rights.
On the 29(th) November 2011, the company bought back 1,874,419
Ordinary shares at a price of 63 pence per share. The company
intends to cancel these shares, along with the 34,500 Ordinary
Shares held in treasury. As a consequence of such cancellation,
the issued share capital of the Company will be 9,372,100 Ordinary
Shares.
6. Dividends
A final dividend, based on the results for the year ended 30(th)
April 2011, of 1.20p per share was paid on 10(th) October 2011
(30(th) April 2010; 1.20p).
7. Taxation
The current year income tax income for the six months ended
31(st) October 2011 is estimated at 28% of the loss before
tax (year ended 30(th) April 2011; 28%). The total tax receipt
is estimated at GBP49,414 for the period (30(th) April 2011;
tax charge of GBP164,983).
8. Ultimate controlling party
The ultimate controlling party at the end of this interim period
was Mr W. Hindmarch, the Chief Executive Officer of the Company,
who owns 54.25% of the issued share capital at the balance
sheet date.
9. Publication of non-statutory accounts
The financial information contained in this interim statement
does not constitute statutory accounts as defined in sections
434 of the Companies Act 2006. All information is unaudited
apart from that included for the year ended 30(th) April 2011.
The statutory accounts for the financial year ended 30(th)
April 2011 were prepared under IFRS as adopted by the EU. These
accounts, upon which the auditors issued an unqualified opinion
did not include references to any matters to which the auditors
drew attention by way of emphasis without qualifying their
report and did not contain statements under 498(2) or (3),
(accounting records or returns inadequate, accounts not agreeing
with records and returns or failure to obtain necessary information
and explanations) of the Companies Act 2006, have been delivered
to the Registrar of Companies.
This interim statement will be made available at the Company's
registered office at 2 Plato Place, 72-74 St Dionis Road, London
SW6 4TU.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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