TIDMDWSN
RNS Number : 8231R
Dawson International PLC
31 August 2010
Tuesday 31 August 2010
DAWSON INTERNATIONAL PLC
HALF YEAR REPORT FOR THE PERIOD ENDED 3 JULY 2010
KEY POINTS
Continuing Operations highlights:
· Turnover GBP20.3 million (2009: GBP23.2 million)
· Turnover from underlying ongoing operations GBP19.1 million (2009:
GBP18.6 million)
· Operating loss before exceptional items GBP3.4 million (2009: GBP3.1
million)
· Operating loss after exceptional items GBP2.7 million (2009: GBP2.9
million)
· Seasonally stronger second half expected to reverse first half loss but
full year results expected to be lower than last year due to increased commodity
prices
· Further reduction of the cost base targeted
· Phased exit from Home Furnishings Branded completed within budget
· Strong cash position GBP11.6 million (2009: GBP4.0 million debt)
Commenting on the half year results, chairman David Bolton said: "Trading in
the first half of the year reflects the seasonality of our businesses and the
phased exit from Home Furnishings Branded, which was completed during the
period. The pre-exceptional operating loss for the first half has widened
despite an improvement in underlying sales and a reduction of losses in Home
Furnishings Branded. While we expect to reverse the loss in the second half we
anticipate that pre-exceptional operating profits for the full year will be
lower than last year due to increased commodity prices which cannot be fully
passed on in the current economic climate.
"Significant progress has been made in the past year through the disposal of
Todd & Duncan and the exit from Home Furnishings Branded, which has greatly
improved the financial position of the Group. Actions are being taken to
preserve and improve that financial stability. Given the current economic
environment we intend to further reduce the cost base and ensure our
organisational structure is efficient and responsive. This will enable us to
continue to attract new customers, provide innovative products and ever
improving service levels at prices that represent excellent value. Through this
approach we expect to secure the best possible margins and position ourselves to
create value for shareholders.
"Dialogue with the Pensions Trustee will continue during the second half of 2010
to address our key priority of reducing the pension deficit and associated
costs".
For further information please contact:
Andy Bartmess, Chief Executive Officer: 0207 448 1000
Zoe Biddick, Biddicks Financial Public Relations: 0207 448 1000
Robin Gwyn, WH Ireland 0161 832 2174
Chairman's Statement
Trading in the first half of the year reflects the seasonality of our businesses
and our phased exit from Home Furnishings Branded which was completed in the
period. Turnover from continuing operations reduced by 13 per cent to GBP20.3
million and operating losses before exceptional items widened from GBP3.1
million to GBP3.4 million. The reduction in turnover is due to our exit from
Home Furnishings Branded which is included within continuing operations as
required by financial reporting standards. Turnover from the underlying ongoing
businesses increased by GBP0.4 million.
The first half operating loss reflects the seasonal nature of our business which
is strongly biased to the second half of the year. The pre-exceptional operating
loss for the first half has increased despite both the improvement in underlying
sales and a reduction of losses in Home Furnishings Branded. This is the result
of sales mix and higher commodity prices which could not be fully passed on to
customers in the current economic climate. While we expect to reverse this loss
in the second half, margins will continue to be impacted by increased commodity
prices and we therefore expect that profits for the full year will be lower than
last year. This is clearly unsatisfactory. Actions taken over the past few
years have provided the Group with a level of financial stability and, given the
current economic environment, we intend to take additional action to preserve
and improve this position. In particular we intend to further reduce our cost
base and to ensure our organisational structure is both efficient and
responsive. This will enable us to continue to attract new customers, provide
innovative products and ever improving service levels to our existing customers
with prices that represent excellent value. In this way we expect to secure the
best possible margins and position ourselves to create value for our
shareholders.
Significant progress has been made in the past year through the disposal of Todd
& Duncan and our exit from Home Furnishings Branded which has greatly improved
the financial position of the Group. The exit from Home Furnishings Branded was
completed on time and within budget. I am also pleased to report that a further
payment of $1 million (GBP0.7 million) was received from the Company's former
joint venture partner in the first half of the year in accordance with our
latest agreed payment plan.
As indicated in the 2009 Annual Report, a key priority for 2010 is to seek ways
to reduce the pension deficit and associated costs by working with the Pensions
Trustee to reduce liabilities and increase returns on assets. The protracted
nature of our negotiations with the Pensions Trustee has been a major
frustration for the Board, incurring a significant amount of senior management
time, impeding the development of the business that will ultimately fund the
deficit. Discussions to finalise the 2009 triennial valuation remain ongoing
and the Company has meanwhile agreed to increase annual deficit repair
contributions from GBP350,000 to GBP400,000 per annum.
Operating and Financial Review
Continuing Operations
+------------------------------+--------+--------+-+---------+---------+
| | | | Operating |
| | Revenues | | profit (loss) |
| | | | before |
| | | | exceptional |
| | | | items |
+------------------------------+-----------------+-+-------------------+
| | 2010 | 2009 | | 2010 | 2009 |
+------------------------------+--------+--------+-+---------+---------+
| | GBP000 | GBP000 | | GBP000 | GBP000 |
+------------------------------+--------+--------+-+---------+---------+
| UK Knitwear | 2,739 | 2,859 | | (352) | (124) |
+------------------------------+--------+--------+-+---------+---------+
| US Knitwear | 2,655 | 1,652 | | (1,109) | (1,171) |
+------------------------------+--------+--------+-+---------+---------+
| Home Furnishings Private | 13,671 | 14,133 | | (287) | (45) |
| Label (i, ii) | | | | | |
+------------------------------+--------+--------+-+---------+---------+
| Central costs | | | | (1,247) | (1,176) |
+------------------------------+--------+--------+-+---------+---------+
| Continuing operations | 19,065 | 18,644 | | (2,995) | (2,516) |
| underlying results | | | | | |
+------------------------------+--------+--------+-+---------+---------+
| Home Furnishings Branded (i, | 1,218 | 4,605 | | (355) | (578) |
| ii) | | | | | |
+------------------------------+--------+--------+-+---------+---------+
| Continuing operations | 20,283 | 23,249 | | (3,350) | (3,094) |
+------------------------------+--------+--------+-+---------+---------+
(i) The Home Furnishings Branded business, while classified as a
continuing operation as required by IFRS, has been exited and so is shown
separately to allow a comparison of underlying results.
(ii) Certain costs and revenues, previously reported within the Home
Furnishings Branded business, have been transferred to the ongoing Home
Furnishings Private Label business. Prior year figures have been restated to
compare, as closely as possible, on a like for like basis.
Turnover from continuing operations for the six months ended 3 July 2010 was
GBP20.3 million, a reduction of GBP3.0 million or 13 per cent. This was due to
the exit from Home Furnishings Branded with underlying sales increasing by
GBP0.4 million. Pre-exceptional operating loss for the period was GBP3.4 million
(2009: GBP3.1 million). The Group is seasonally biased to the second half of
the year, particularly the US Knitwear division which generates over 90 per cent
of its sales and all of its profit in the second half of the year.
UK Knitwear
Turnover in the first half of the year was GBP2.7 million (2009: GBP2.9 million)
and the operating loss GBP0.4 million (2009: GBP0.1 million). In the 2009 Annual
Report we noted that the final quarter had benefited from the timing of sales to
high margin couture customers and that this would have a corresponding negative
effect on the first quarter of 2010. The impact was compounded by the late
delivery of accessories from a customer's external supplier which resulted in
some sales being delayed into the second half in 2010.
Sales and margins for the full year are expected to be lower than the last two
excellent years. This is the result of increased cashmere fibre prices, ongoing
uncertainty in the global economy and its effect on consumer confidence.
US Knitwear
Turnover for the first half of the year in US Dollars was $4.0 million (2009:
$2.5 million) and the operating loss $1.7 million (2009: $1.8 million). A
number of new private label accounts were opened in the first half of 2010,
including outdoor clothing retailer, Patagonia. Sales also benefited from a
strong start to the year in the 'Kinross' branded business with sales up 39 per
cent against the same period in 2009. The business is working on a number of
strategic initiatives to continue to grow this side of the business.
Dawson Forte generates 90 per cent of its turnover and all of its profits in the
second half of the year. The key measure for this business at the half year is
therefore the open order position which was $31.9 million compared with $30.2
million in the prior year. The challenge facing the business in 2010 is the
significant increase in the cost of raw cashmere fibre. With price increases
averaging around 20 per cent higher than the same period last year, combined
with increased manufacturing costs, both turnover and margins will be negatively
affected, as retailers are unwilling to absorb the full impact of price
increases in the current environment.
It is anticipated that turnover for 2010 will be broadly similar to last year
but profits will be impacted by reduced margins. Responding to these economic
conditions, the business is focused on developing its product offering to appeal
to more price sensitive customers, whilst maintaining high levels of design,
quality and customer service.
Home Furnishings - Branded
The planned exit from Dorma retail operations and the process of liquidating
working capital has successfully completed on time and within budget during the
first half of 2010, reducing both sales and operating losses for the period.
Turnover in the first half was GBP1.2 million (2009: GBP4.6 million) while
operating losses reduced from GBP0.6 million to GBP0.4 million. This completes
this stage of the strategy set out in 2008 to restructure the Home Furnishings
division as a private label, premium quality supplier of bed linen and related
products to Home Textile retailers.
Home Furnishings - Private Label
Turnover in the first half of the year was GBP13.7 million (2009: GBP14.1
million) and the business reported an operating loss of GBP0.3 million (2009:
GBP0.1 million loss). The fall in turnover is largely due to the transitioning
of mail order sales from a predominantly "Dorma" offering to the "Vantona"
label.Margins fell in the period due to higher levels of inventory clearance
activity, caused by customers changing ordering patterns in a move to adapt
their business models to compete more effectively in the current environment.
This is expected to benefit second half results which will now have less
clearance activity. In addition, cotton and freight costs have increased
sharply and it has not been possible to pass on all of these cost increases in
the current market environment.
During the period supply chain and ordering policies have been updated providing
much improved flexibility to react to change whilst incurring far lower levels
of obsolete inventory.
As a result of the exit from Home Furnishings Branded approximately GBP0.3
million of fixed establishment costs, previously allocated to Branded, are now
being allocated to Private Label. Reductions in the cost base have been made to
reflect the new business model and future needs of the Private Label Division
which we continue to keep under review.
The business is focused on growing and diversifying its customer base. There has
been some success in new business development, however overall activity in this
area has fallen short of expectations, particularly in the US market and the
incremental margin generated does not yet cover the increased costs of the
business.
Discontinued Operations
Following the sale of Todd & Duncan to Ningxia Zhongyin Cashmere Company Limited
in August 2009, final costs of GBP70,000 were incurred during the first half of
2010.
Central Costs
Central costs are largely in line with the same period in 2009. Net exceptional
income of $1.0 million was recorded in the year (2009: $0.5 million) from the
recovery of a previously provided long standing debt due from the Company's
former joint venture partner.
Pension Liabilities
The net pension liability at June 2010 was GBP19.2 million which compares with a
deficit of GBP19.3 million at December 2009 and GBP6.3 million at June 2009. The
Directors have considered the significant assumptions used in the valuation of
the Group's defined benefit pension schemes at December 2009 and concluded that
a reduction in corporate bond yields in the period to 3 July 2010 has been
mitigated by a reduction in projected long term inflation rates. No actuarial
valuations of the assets and liabilities were therefore performed at 3 July 2010
and the change in the deficit represents contributions made in the period and
the exchange movement on the US scheme.
The Company has made all regular contributions falling due in the period and has
increased the annual deficit repair contribution from GBP350,000 to GBP400,000.
Funding and Facilities
Net funds at 3 July 2010 were GBP11.6 million which compares with net funds of
GBP12.3 million at December 2009 and net debt of GBP4.0 million at June 2009.
The borrowing facility with Bank of America, which funds our US operations, has
been renewed for a further three year period. The facility has been reduced
from $25 million to $15 million to better reflect our seasonal requirements and
reduce fees.
The Company has indicative offers from a number of possible lenders to replace
the working capital facility with Gmac Commercial Finance which expires in
October 2010 and expects to finalise new arrangements shortly.
Strategy and Outlook
In view of continuing uncertainty in all of our markets, combined with
significant increases in commodity prices and the difficulty associated with
passing these on in the current economic climate, we anticipate a reduction in
margins for the full year. We will mitigate this where possible through further
cost savings. Dialogue with the Pensions Trustee will continue during the second
half of 2010 to address our key priority of reducing the pension deficit and
associated costs.
Our business strategy remains focused on maintaining and building on our
inherent strengths in tailored retail programmes delivering the highest quality,
product design and service. It is more important than ever in these difficult
economic times that we strive to maintain the very close working relationships
that exist with our customers and to continue to be innovative, creating design
and product solutions with broad appeal and price point to grow market share
when consumer confidence improves.
David Bolton
Chairman
+----------------------------------------+------+-------------+--------------+----------+
| CONSOLIDATED INCOME STATEMENT | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| For the period ended 3 July 2010 | | 6 months | 6 | 12 |
| | | to 3 July | months | months |
| | | 2010 | to 4 | to |
| | | | July | 2 |
| | | | 2009 | January |
| | | | re-presented | 2010 |
+----------------------------------------+------+-------------+--------------+----------+
| | Note | GBP000 | GBP000 | GBP000 |
+----------------------------------------+------+-------------+--------------+----------+
| Continuing operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Revenue | 2 | 20,283 | 23,249 | 72,883 |
+----------------------------------------+------+-------------+--------------+----------+
| Cost of sales | | (16,847) | (18,380) | (55,744) |
+----------------------------------------+------+-------------+--------------+----------+
| Gross profit | | 3,436 | 4,869 | 17,139 |
+----------------------------------------+------+-------------+--------------+----------+
| Other income | | 16 | - | 82 |
+----------------------------------------+------+-------------+--------------+----------+
| Selling and distribution costs | | (2,891) | (4,162) | (7,992) |
+----------------------------------------+------+-------------+--------------+----------+
| Administrative expenses | | (3,911) | (3,801) | (7,823) |
+----------------------------------------+------+-------------+--------------+----------+
| Operating (loss) profit before | 2 | (3,350) | (3,094) | 1,406 |
| exceptional items | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Exceptional items | 3 | 668 | 223 | 556 |
+----------------------------------------+------+-------------+--------------+----------+
| Operating (loss) profit | | (2,682) | (2,871) | 1,962 |
+----------------------------------------+------+-------------+--------------+----------+
| Finance income | 5 | - | 6 | 15 |
+----------------------------------------+------+-------------+--------------+----------+
| Finance costs | 5 | (90) | (262) | (513) |
+----------------------------------------+------+-------------+--------------+----------+
| Net finance expense on pension | | - | - | (889) |
| assets/liabilities | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| (Loss) profit before taxation | | (2,772) | (3,127) | 575 |
+----------------------------------------+------+-------------+--------------+----------+
| Taxation | 7 | (225) | (595) | (291) |
+----------------------------------------+------+-------------+--------------+----------+
| (Loss) profit for the period from | | (2,997) | (3,722) | 284 |
| continuing operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Discontinued operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Loss for the period from discontinued | 4 | (70) | (5,282) | (6,127) |
| operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Loss for the period | | (3,067) | (9,004) | (5,843) |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Basic and Diluted (loss) earnings per | | | | |
| share | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| - From continuing operations | 6 | (1.3)p | (1.7)p | 0.1p |
+----------------------------------------+------+-------------+--------------+----------+
| - From continuing and discontinued | 6 | (1.3)p | (4.0)p | (2.6)p |
| operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME | | |
+-------------------------------------------------------------+--------------+----------+
| For the period ended 3 July 2010 | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| | | 6 months | 6 | 12 |
| | | to 3 July | months | months |
| | | 2010 | to 4 | to |
| | | GBP000 | July | 2 |
| | | | 2009 | January |
| | | | GBP000 | 2010 |
| | | | | GBP000 |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Loss for the period | | (3,067) | (9,004) | (5,843) |
+----------------------------------------+------+-------------+--------------+----------+
| | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Other comprehensive income: | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Exchange differences on translation of | | 430 | (248) | (577) |
| foreign operations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Actuarial loss on defined benefit | | - | - | (12,373) |
| pension obligations | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Other comprehensive income for the | | 430 | (248) | (12,950) |
| period | | | | |
+----------------------------------------+------+-------------+--------------+----------+
| Total comprehensive income for the | | (2,637) | (9,252) | (18,793) |
| period | | | | |
+----------------------------------------+------+-------------+--------------+----------+
Total comprehensive income is all attributable to equity holders of the parent.
+-----------------------------------+---------+---------+-------------+----------+----------+
| CONSOLIDATED BALANCE SHEET | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| As at 3 July 2010 | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | 3 | 4 | 2 |
| | | | July | July | January |
| | | | 2010 | 2009 | 2010 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | Note | GBP000 | GBP000 | GBP000 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Non-current assets | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Intangible assets | | | 116 | 121 | 143 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Property, plant and equipment | | | 873 | 962 | 925 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Deferred tax asset | | | 1,750 | 1,500 | 1,750 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total non-current assets | | | 2,739 | 2,583 | 2,818 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Current assets | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Inventories | | | 9,615 | 12,566 | 8,309 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Trade and other receivables | | | 6,181 | 15,634 | 9,350 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Cash and cash equivalents | | | 11,597 | 3,249 | 12,343 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Disposal group held for sale | | | - | 10,716 | - |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total current assets | | | 27,393 | 42,165 | 30,002 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total assets | | | 30,132 | 44,748 | 32,820 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Current liabilities | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Trade and other payables | | | 10,477 | 12,315 | 9,479 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Income tax payable | | | - | 126 | 384 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Borrowings | | | - | 7,212 | - |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Provisions | | | 639 | 1,246 | 1,144 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Other financial liabilities | | | - | 462 | 51 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Liabilities directly associated with | 4 | - | 4,842 | - |
| disposal group held for sale | | | | |
+---------------------------------------------+---------+-------------+----------+----------+
| Total current liabilities | | | 11,116 | 26,203 | 11,058 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Non-current liabilities | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Provisions | | | 1,006 | 1,214 | 1,022 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Retirement benefit obligations | | 8 | 19,153 | 6,306 | 19,246 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total non-current liabilities | | | 20,159 | 7,520 | 20,268 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total liabilities | | | 31,275 | 33,723 | 31,326 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Net (liabilities) assets | | | (1,143) | 11,025 | 1,494 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Equity | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Share capital | | | 51,989 | 51,989 | 51,989 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Share premium account | | | 5,489 | 5,489 | 5,489 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Translation reserve | | | 670 | 570 | 240 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Retained earnings | | | (59,291) | (47,023) | (56,224) |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total (deficit) equity | | | (1,143) | 11,025 | 1,494 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | | |
| | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| CONSOLIDATED STATEMENT OF CHANGES IN | | | | |
| EQUITY | | | | |
+---------------------------------------------+---------+-------------+----------+----------+
| For the period ended 3 July 2010 | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | Profit | |
| | Share | Share | Translation | and | |
| | Capital | Premium | Reserve | Loss | Total |
| | GBP000 | GBP000 | GBP000 | account | GBP000 |
| | | | | GBP000 | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| At 3 January 2009 | 51,989 | 5,489 | 818 | (38,056) | 20,240 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total comprehensive income for | - | - | (248) | (9,004) | (9,252) |
| the period | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Share-based payments charge | - | - | - | 37 | 37 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| At 4 July 2009 | 51,989 | 5,489 | 570 | (47,023) | 11,025 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| At 2 January 2010 | 51,989 | 5,489 | 240 | (56,224) | 1,494 |
+-----------------------------------+---------+---------+-------------+----------+----------+
| Total comprehensive income for | - | - | 430 | (3,067) | (2,637) |
| the period | | | | | |
+-----------------------------------+---------+---------+-------------+----------+----------+
| At 3 July 2010 | 51,989 | 5,489 | 670 | (59,291) | (1,143) |
+-----------------------------------+---------+---------+-------------+----------+----------+
+----------------------------------------------+------------+---------+---------+
| CONSOLIDATED CASH FLOW STATEMENT | | | |
+----------------------------------------------+------------+---------+---------+
| For the period ended 3 July 2010 | | | |
+----------------------------------------------+------------+---------+---------+
| | | | 12 |
| | 6 months | 6 | months |
| | to 3 July | months | to |
| | 2010 | to 4 | 2 |
| | GBP000 | July | January |
| | | 2009 | 2010 |
| | | GBP000 | GBP000 |
+----------------------------------------------+------------+---------+---------+
| | | | |
| Continuing operations | | | |
+----------------------------------------------+------------+---------+---------+
| (Loss) profit before tax | (2,772) | (3,127) | 575 |
+----------------------------------------------+------------+---------+---------+
| Depreciation | 136 | 85 | 214 |
+----------------------------------------------+------------+---------+---------+
| Net finance expense | 90 | 256 | 1,387 |
+----------------------------------------------+------------+---------+---------+
| Share based payment expense | - | 37 | 47 |
+----------------------------------------------+------------+---------+---------+
| | (2,546) | (2,749) | 2,223 |
+----------------------------------------------+------------+---------+---------+
| (Increase) decrease in inventories | (1,242) | (2,440) | 1,950 |
+----------------------------------------------+------------+---------+---------+
| Decrease in debtors | 2,895 | 3,717 | 1,799 |
+----------------------------------------------+------------+---------+---------+
| Increase (decrease) in creditors | 971 | (2,169) | (3,326) |
+----------------------------------------------+------------+---------+---------+
| Decrease in provisions | (533) | (1,455) | (1,711) |
+----------------------------------------------+------------+---------+---------+
| Cash (used) generated by operations | (455) | (5,096) | 935 |
+----------------------------------------------+------------+---------+---------+
| Additional contributions to pension schemes | (187) | (175) | (606) |
+----------------------------------------------+------------+---------+---------+
| Taxes paid | (642) | (565) | (261) |
+----------------------------------------------+------------+---------+---------+
| Net cash (used) generated by operating | (1,284) | (5,836) | 68 |
| activities | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| Cash flows from investing activities | | | |
+----------------------------------------------+------------+---------+---------+
| Interest received | - | 6 | 15 |
+----------------------------------------------+------------+---------+---------+
| Proceeds from disposal of Todd & Duncan | - | - | 5,426 |
+----------------------------------------------+------------+---------+---------+
| Purchase of property, plant and equipment | (55) | (35) | (114) |
+----------------------------------------------+------------+---------+---------+
| Purchase of intangible assets | (1) | (12) | (59) |
+----------------------------------------------+------------+---------+---------+
| Net cash (used) generated by investing | (56) | (41) | 5,268 |
| activities | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| Cash flows from financing activities | | | |
+----------------------------------------------+------------+---------+---------+
| Interest paid | (90) | (262) | (513) |
+----------------------------------------------+------------+---------+---------+
| Increase (decrease) in asset backed finance | - | 3,000 | (4,212) |
+----------------------------------------------+------------+---------+---------+
| Net cash (used) generated by financing | (90) | 2,738 | (4,725) |
| activities | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| Net cash (used) generated by continuing | (1,430) | (3,139) | 611 |
| operations | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| Discontinued operations | | | |
+----------------------------------------------+------------+---------+---------+
| Net cash generated (used) by operating | 238 | (2,591) | 2,930 |
| activities | | | |
+----------------------------------------------+------------+---------+---------+
| Net cash used by investing activities | - | (446) | (270) |
+----------------------------------------------+------------+---------+---------+
| Net cash generated (used) by discontinued | 238 | (3,037) | 2,660 |
| operations | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| Net (decrease) increase in cash and cash | (1,192) | (6,176) | 3,271 |
| equivalents | | | |
+----------------------------------------------+------------+---------+---------+
| Cash and cash equivalents at the beginning | 12,343 | 9,900 | 9,900 |
| of the period | | | |
+----------------------------------------------+------------+---------+---------+
| Exchange rate effects | 446 | (475) | (828) |
+----------------------------------------------+------------+---------+---------+
| Cash and cash equivalents at the end of the | 11,597 | 3,249 | 12,343 |
| period | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| | | | |
| | | | |
+----------------------------------------------+------------+---------+---------+
| RECONCILIATION OF MOVEMENT IN NET FUNDS | | | |
| (DEBT) | | | |
+----------------------------------------------+------------+---------+---------+
| For the period ended 3 July 2010 | | | 12 |
| | 6 months | 6 | months |
| | to 3 July | months | to |
| | 2010 | to 4 | 2 |
| | GBP000 | July | January |
| | | 2009 | 2010 |
| | | GBP000 | GBP000 |
+----------------------------------------------+------------+---------+---------+
| | | | |
+----------------------------------------------+------------+---------+---------+
| (Decrease) increase in cash and cash | (1,192) | (6,176) | 3,271 |
| equivalents | | | |
+----------------------------------------------+------------+---------+---------+
| (Increase) decrease in asset backed finance | - | (3,000) | 4,212 |
+----------------------------------------------+------------+---------+---------+
| Exchange rate effects | 446 | (475) | (828) |
+----------------------------------------------+------------+---------+---------+
| (Decrease) increase in net funds | (746) | (9,651) | 6,655 |
+----------------------------------------------+------------+---------+---------+
| Opening net funds | 12,343 | 5,688 | 5,688 |
+----------------------------------------------+------------+---------+---------+
| Closing net funds (debt) | 11,597 | (3,963) | 12,343 |
+----------------------------------------------+------------+---------+---------+
NOTES TO THE HALF YEAR REPORT
1. Basis of preparation and significant accounting policies
Basis of preparation
This half year report contains the condensed consolidated financial information
of the Company and its subsidiaries ("the Group") for the six month period ended
3 July 2010 prepared in accordance with the AIM rules. It is unaudited and has
not been reviewed by the auditors. The report does not contain all of the
information and disclosures required in the annual financial statements and does
not therefore constitute statutory accounts as defined in section 435 of the
Companies Act 2006. It should be read in conjunction with the 2009 Annual
Report.
Comparative information for the six months to 4 July 2009 has been
re-presented to reflect treatment in the 2009 Annual Report as follows:
(i) Revenues of the Home Furnishings divisions have been restated to net
GBP842,000 of customer discounts previously treated as cost of sales.
(ii) Proceeds from the recovery of a previously provided debt of GBP348,000
have been re-allocated from other operating income to exceptional items.
Comparative information for the twelve month period to 2 January 2010 is based
on the statutory accounts for that period which were prepared under
International Financial Reporting Standards as adopted by the EU and have been
delivered to the Registrar of Companies. The report of the auditors (i) was
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 statements under section 498 (2) or (3) of the Companies
Act 2006.
The financial information is prepared on the historical cost basis
with the exception of assets and liabilities which are classified as held for
sale and is presented in Sterling, rounded to the nearest thousand.
The condensed financial statements have been prepared on the going concern basis
which the Directors consider to be appropriate based on a review of projected
cashflows which take into account (i) the general economic environment, which
continues to be challenging and (ii) the business specific risks and
uncertainties which are discussed on pages 13 and 14 of the 2009 Annual Report
and are not considered to have changed.
This half year report contains certain forward looking statements which are
subject to various risks and uncertainties and should therefore be treated with
an appropriate level of caution and not regarded as a forecast of future
results.
Significant accounting policies
The half year condensed consolidated financial statements have been prepared
applying the same accounting policies that were applied in the preparation of
the Company's published consolidated financial statements for the year ended 2
January 2010.
The following new standards, amendments to standards and
interpretations are mandatory for the first time for financial periods
commencing on 1 January 2010 but have had no material impact on the financial
statements of the Group.
· IFRS 3 (amended) Business combinations
· IAS 27 (amended) Consolidated and separate financial statements
· Improvements to IFRSs 2009
· IFRIC 17 Distribution of non-cash assets to owners
· IFRS 1 (amended) Additional exemptions for first-time adopters
This half year report was approved by the Board of Directors on 30 August 2010.
Copies of this report and the 2009 Annual Report are available on the Company's
website at www.dawson-international.co.uk.
2. Segmental analysis
The chief operating decision maker has been identified as the Board of
Directors.
The Board reviews the internal reports of the Group in order to assess
performance and allocate resources and has determined the operating segments
based on these internal reports as follows:
UK Knitwear
This segment comprises the Barrie business which manufactures cashmere
and woollen garments which are sold mainly in the European market. It sells
both to private label customers and under its own labels which include Barrie,
John Laing and Glenmac.
US Knitwear
This segment comprises the Forte business which sources cashmere garments
from China which are sold in the American market, primarily to large private
label customers. It also sells to smaller boutique customers under its own
'Kinross' label. This business is highly seasonal, making over 90 per cent of
its sales and all of its profit in the second half of the year.
Home Furnishings - Private Label
This segment designs and sources bed linen, primarily from Asia, which
is sold to Private Label customers.
Home Furnishings - Branded
This segment designed and sourced 'Dorma' branded bed linen which it
retailed through a number of channels. Following the sale of the 'Dorma' brand
to Dunelm Group in July 2008 a phased exit from this business commenced which is
now substantially complete. Certain costs and revenues, previously allocated to
the Home Furnishings Branded segment form part of ongoing operations and have
been allocated to the Home Furnishings Private Label segment in the current
period. Prior period figures have been restated to compare as closely as
possible on a like for like basis.
+--------------------------+---------+---------+---------+---------+---------+---------+
| | Revenue | Profit (loss) |
+--------------------------+-----------------------------+-----------------------------+
| | | | 12 | | | 12 |
| | 6 | 6 | months | 6 | 6 | months |
| | months | months | to | months | months | to |
| | to 3 | to 4 | 2 | to 3 | to 4 | 2 |
| | July | July | January | July | July | January |
| | 2010 | 2009* | 2010 | 2010 | 2009* | 2010 |
| | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
| | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| UK Knitwear | 2,739 | 2,859 | 7,896 | (352) | (124) | 1,133 |
+--------------------------+---------+---------+---------+---------+---------+---------+
| US Knitwear | 2,655 | 1,652 | 28,695 | (1,109) | (1,171) | 3,774 |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Home Furnishings - | 13,671 | 14,133 | 28,109 | (287) | (45) | (643) |
| Private Label | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Home Furnishings - | 1,218 | 4,605 | 8,183 | (355) | (578) | (839) |
| Branded | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Segmental | 20,283 | 23,249 | 72,883 | (2,103) | (1,918) | 3,425 |
| revenues/results before | | | | | | |
| exceptional items and | | | | | | |
| central costs | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Unallocated central | | | | (1,247) | (1,176) | (2,019) |
| costs | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Operating (loss) profit | | | | (3,350) | (3,094) | 1,406 |
| before exceptional items | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Exceptional items | | | | 668 | 223 | 556 |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Net finance charges | | | | (90) | (256) | (498) |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Net finance expense on | | | | - | - | (889) |
| pension | | | | | | |
| assets/liabilities | | | | | | |
+--------------------------+---------+---------+---------+---------+---------+---------+
| Continuing operations | 20,283 | 23,249 | 72,883 | (2,772) | (3,127) | 575 |
+--------------------------+---------+---------+---------+---------+---------+---------+
* Comparative information for the six months to 4 July 2009 has been
re-presented to reflect treatment in the 2009 Annual Report as follows:
(i) Revenues of the Home Furnishings divisions have been restated to net
GBP842,000 of customer discounts previously treated as cost of sales.
(ii) Proceeds from the recovery of a previously provided debt of GBP348,000
have been re-allocated from other operating income to exceptional items.
Net finance charges are not allocated across segments as borrowing requirements
are managed on a Group wide basis.
The results of discontinued operations are disclosed in note 4.
+------------------+---+--+----------------------+---------+---------+---------+
| | | | | Assets |
+------------------+---+--+----------------------+-----------------------------+
| | | | | 3 July | 4 | 2 |
| | | | | 2010 | July | January |
| | | | | GBP000 | 2009 | 2010 |
| | | | | | GBP000 | GBP000 |
+------------------+---+--+----------------------+---------+---------+---------+
| | | | | | | |
+------------------+---+--+----------------------+---------+---------+---------+
| UK Knitwear | 2,693 | 2,549 | 2,267 |
+------------------------------------------------+---------+---------+---------+
| US Knitwear | 2,414 | 2,692 | 3,052 |
+------------------------------------------------+---------+---------+---------+
| Home Furnishings - Private Label | 11,133 | 8,918 | 8,313 |
+------------------------------------------------+---------+---------+---------+
| Home Furnishings - Branded | 62 | 5,284 | 3,818 |
+------------------------------------------------+---------+---------+---------+
| Segmental assets | 16,302 | 19,443 | 17,450 |
+------------------------------------------------+---------+---------+---------+
| Unallocated central assets | 290 | 1,110 | 628 |
+------------------------------------------------+---------+---------+---------+
| Deferred tax | 1,750 | 1,500 | 1,750 |
+------------------------------------------------+---------+---------+---------+
| Cash and deposits | 11,597 | 3,249 | 12,343 |
+------------------------------------------------+---------+---------+---------+
| Total assets, continuing operations | 29,939 | 25,302 | 32,171 |
+------------------------------------------------+---------+---------+---------+
| Total assets, discontinued operations | 193 | 19,446 | 649 |
+------------------------------------------------+---------+---------+---------+
| Total assets | 30,132 | 44,748 | 32,820 |
+------------------+---+--+----------------------+---------+---------+---------+
3. Exceptional items - continuing operations
+----------------+--------------------------------+--------+--------+---------+
| | | | | 12 |
| | | 6 | 6 | months |
| | | months | months | to |
| | | to 3 | to 4 | 2 |
| | | July | July | January |
| | | 2010 | 2009 | 2010 |
| | | GBP000 | GBP000 | GBP000 |
| | | | | |
+----------------+--------------------------------+--------+--------+---------+
| | | | | |
+----------------+--------------------------------+--------+--------+---------+
| Doubtful debt recovered (i) | 668 | 348 | 973 |
+-------------------------------------------------+--------+--------+---------+
| Reorganisation costs | - | (125) | (125) |
+-------------------------------------------------+--------+--------+---------+
| Property and environmental costs | - | - | (292) |
+-------------------------------------------------+--------+--------+---------+
| | | 668 | 223 | 556 |
+----------------+--------------------------------+--------+--------+---------+
(i) In 2009 the Company established a payment plan to recover a debt of
approximately $10 million due by a former joint venture partner which had been
fully provided. Payments of $0.5 million and $1.0 million were received in June
and December of 2009 in accordance with that plan. The payment of $0.5 million
(GBP348,000) received in June 2009 was classified as other income in the 2009
half year accounts but has been re-classified as exceptional income to reflect
the treatment in the 2009 Annual Report. A further payment of $1.0 million was
received in June 2010 in accordance with the payment plan. Given the age of the
debt and the breakdown of previous payment plans, the Company considers it
appropriate to retain a full provision against the outstanding balance at this
time.
4. Discontinued operations
On 28 August 2009 the Company completed the sale of the business, fixed
assets and stocks of the Todd & Duncan yarn spinning division to Ningxia
Zhongyin Cashmere Company Limited. The consideration was based on the value of
fixed assets and stocks at completion less a discount of GBP4.2 million. The
Company incurred costs of GBP946,000 in respect of the disposal. The results of
discontinued operations are as follows:
+-------------+-----------------------------------+--------+----------+----------+
| | | | | 12 |
| | | 6 | 6 | months |
| | | months | months | to |
| | | to 3 | to 4 | 2 |
| | | July | July | January |
| | | 2010 | 2009 | 2010 |
| | | GBP000 | GBP000 | GBP000 |
| | | | | |
+-------------+-----------------------------------+--------+----------+----------+
| Revenue | - | 12,399 | 14,625 |
+-------------------------------------------------+--------+----------+----------+
| Cost of sales | - | (10,934) | (13,201) |
+-------------------------------------------------+--------+----------+----------+
| Gross margin | - | 1,465 | 1,424 |
+-------------------------------------------------+--------+----------+----------+
| Operating expenses | (70) | (1,729) | (2,351) |
+-------------------------------------------------+--------+----------+----------+
| Loss before exceptional items | (70) | (264) | (927) |
+-------------------------------------------------+--------+----------+----------+
| Loss on disposal of business | - | (5,018) | (5,200) |
+-------------------------------------------------+--------+----------+----------+
| Loss for the period from discontinued | (70) | (5,282) | (6,127) |
| operations | | | |
+-------------+-----------------------------------+--------+----------+----------+
Full provision has been made for all outstanding receivables at June 2010.
+--+--------------------------------------------------+----------+----------+----------+
| | | | | 12 |
| | | 6 | 6 | months |
| | | months | months | to |
| | | to 3 | to 4 | 2 |
| 5.| Finance income (costs) | July | July | January |
| | | 2010 | 2009 | 2010 |
| | | GBP000 | GBP000 | GBP000 |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Interest receivable on short-term deposits | - | 6 | 15 |
+--+--------------------------------------------------+----------+----------+----------+
| | Finance income | - | 6 | 15 |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Interest payable on asset backed finance | (90) | (262) | (513) |
+--+--------------------------------------------------+----------+----------+----------+
| | Finance costs | (90) | (262) | (513) |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | 12 |
| | | 6 | 6 | months |
| | | months | months | to |
| 6.| (Loss) earnings per share | to 3 | to 4 | 2 |
| | | July | July | January |
| | | 2010 | 2009 | 2010 |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Basic and diluted (loss) earnings per share | GBP000 | GBP000 | GBP000 |
+--+--------------------------------------------------+----------+----------+----------+
| | (Loss) profit for the period attributable to | | | |
| | equity holders of the parent: | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Continuing operations | (2,997) | (3,722) | 284 |
+--+--------------------------------------------------+----------+----------+----------+
| | Discontinued operations | (70) | (5,282) | (6,127) |
+--+--------------------------------------------------+----------+----------+----------+
| | | (3,067) | (9,004) | (5,843) |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Weighted average number of shares: | 000's | 000's | 000's |
+--+--------------------------------------------------+----------+----------+----------+
| | In issue during the period | 225,158 | 225,158 | 225,158 |
+--+--------------------------------------------------+----------+----------+----------+
| | Dilutive potential ordinary shares | - | - | - |
+--+--------------------------------------------------+----------+----------+----------+
| | | 225,158 | 225,158 | 225,158 |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Basic and diluted (loss) earnings per share: | Pence | Pence | Pence |
+--+--------------------------------------------------+----------+----------+----------+
| | Continuing operations | (1.3) | (1.7) | 0.1 |
+--+--------------------------------------------------+----------+----------+----------+
| | Discontinued operations | - | (2.3) | (2.7) |
+--+--------------------------------------------------+----------+----------+----------+
| | | (1.3) | (4.0) | (2.6) |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | Adjusted loss per share | GBP000 | GBP000 | GBP000 |
+--+--------------------------------------------------+----------+----------+----------+
| | (Loss) profit for the period from continuing | | | |
| | operations | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | attributable to equity holders of the parent | (2,997) | (3,722) | 284 |
+--+--------------------------------------------------+----------+----------+----------+
| | Add back exceptional items | (668) | (223) | (556) |
+--+--------------------------------------------------+----------+----------+----------+
| | | (3,665) | (3,945) | (272) |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | | 000's | 000's | 000's |
+--+--------------------------------------------------+----------+----------+----------+
| | Weighted average number of shares in issue | 225,158 | 225,158 | 225,158 |
+--+--------------------------------------------------+----------+----------+----------+
| | | | | |
+--+--------------------------------------------------+----------+----------+----------+
| | | Pence | Pence | Pence |
+--+--------------------------------------------------+----------+----------+----------+
| | Adjusted loss per share | (1.6) | (1.8) | (0.1) |
+--+--------------------------------------------------+----------+----------+----------+
Adjusted loss per share is calculated on the profit or loss for the period from
continuing operations before exceptional items.
+--+-------------------------------------------------+--------+--------+---------+
| | | | | 12 |
| | | 6 | 6 | months |
| | | months | months | to |
| | | to 3 | to 4 | 2 |
| 7.| Income tax expense | July | July | January |
| | | 2010 | 2009 | 2010 |
| | | GBP000 | GBP000 | GBP000 |
+--+-------------------------------------------------+--------+--------+---------+
| | | | | |
+--+-------------------------------------------------+--------+--------+---------+
| | Current tax expense: | | | |
+--+-------------------------------------------------+--------+--------+---------+
| | Current year | - | 95 | 462 |
+--+-------------------------------------------------+--------+--------+---------+
| | Adjustments in respect of prior years | 225 | 500 | 79 |
+--+-------------------------------------------------+--------+--------+---------+
| | | 225 | 595 | 541 |
+--+-------------------------------------------------+--------+--------+---------+
| | Deferred tax: | | | |
+--+-------------------------------------------------+--------+--------+---------+
| | Origination and reversal of timing differences | - | - | (250) |
+--+-------------------------------------------------+--------+--------+---------+
| | Total income tax expense | 225 | 595 | 291 |
+--+-------------------------------------------------+--------+--------+---------+
The Group has significant tax losses available in the UK and federal tax losses
available in the US subject to any restrictions which may apply as a result of
s.382 of the US tax code (change of ultimate ownership rules).
8. Retirement benefit obligations
The Group operates two defined benefit pension schemes in the UK which are
closed to new members and a defined benefit pension scheme in the USA which is
closed to all members. Following the sale of the Todd & Duncan business the UK
schemes have less than 70 active members and the Company intends to consider
closing the schemes to future accrual for existing members.
Full actuarial valuations of the UK schemes are made triennially by an
independent, professionally qualified actuary and these form the basis of a
recovery plan which is agreed with the Pensions Trustee. The assumptions applied
by the actuary when calculating the deficit and recovery plan differ from those
prescribed by IAS 19 for financial reporting purposes. In particular, the
assumptions used for valuing liabilities are more conservative and can result in
a significantly higher liability than that reported in the balance sheet.
The Company and the Trustee are currently finalising the 2009
valuations and funding plans. Pending completion of that exercise, the Company
has increased deficit repair contributions from GBP350,000 per annum to
GBP400,000 per annum.
The Directors have considered the significant assumptions used in the
valuation of the Group's defined benefit pension schemes and concluded that a
reduction in corporate bond yields in the period has been mitigated by a
reduction in projected long term inflation rates. No actuarial valuations of the
assets and liabilities were therefore performed at 3 July 2010 and the change in
the deficit represents contributions made in the period and the exchange
movement on the US scheme.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR WGUCPRUPUGAU
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