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Applegreen PLC  -  APGN   

Final Results

Released 07:00 13-Mar-2018

RNS Number : 4867H
Applegreen PLC
13 March 2018
 

Applegreen plc

Preliminary Statement of Results for the year ended 31 December 2017

 

Dublin, London, 13 March 2018:   Applegreen plc ('Applegreen' or 'the Group'), a major petrol forecourt retailer with operations in the Republic of Ireland, the United Kingdom and the United States announces its preliminary results for the year ended 31 December 2017.

 

Financial highlights:

·     Adjusted EBITDA increased by 24% to €39.8m in FY 2017 from €32.0m in FY 2016 (26% on a constant currency basis)

·     25% increase in gross profit on FY 2016 (27% at constant currency)

·     Like for like growth of 7.4% in non-fuel gross profit (food and store) at constant currency

·     Revenue up 21% to €1,428.1m.

·     Continued investment in the development of the network with capex for the year of €113.0m

·     Net debt position at 31 December 2017 of €10.2m (31 December 2016: €19.4m)

·     Final dividend of 0.80 cent per share (€0.7m) giving a total dividend for the year of 1.40c (€1.2m)

 

Operational highlights:

·     Grew estate by 99 sites to 342 sites as at 31 December 2017 (31 December 2016: 243)

·     Opened 77 new food outlets in the year

·     Brandi and Carsley site acquisitions contributing significantly to estate growth with 42 sites and 7 sites added, respectively. Both acquisitions completed in October 2017

·     In July 2017, we completed the acquisition of 50% of the Joint Fuels Terminal ("JFT") in Dublin port

 

Key figures:

 

31-Dec-17

31-Dec-16

Change 

Gross Profit (€m)

181.7

145.8

24.6%

Adjusted EBITDA* (€m)

39.8

32.0

24.4%

Adjusted Profit before Tax* (€m)

24.6

20.9

17.7%

Adjusted EPS

 25.65

 23.32

10.0%

*Adjusted for share based payments and non-recurring charges

 

Commenting on the results, Bob Etchingham, CEO said: "We are very pleased to report another strong set of results for the business as we continue to deliver on our growth strategy. This performance was underpinned by positive like for like growth, particularly in the Republic of Ireland, ongoing expansion of our estate and an enhanced fuel margin resulting from our acquisition of a 50% stake in the Joint Fuels Terminal in Dublin Port."

 

"The business saw significant expansion during the year as we increased our estate by 99 sites to a total of 342 locations. We opened 22 new sites in the Republic of Ireland, 20 in the UK and 57 in the US in 2017."

 

"We are confident in the prospects for the company in 2018 as our underlying business continues to perform well and we further evolve our growth strategy. The significant acquisitions completed in 2017 are performing as expected and we are well placed to progress both our organic and acquisition led development plans in the coming year."

 

About Applegreen

 

Established in 1992, Applegreen is a major petrol forecourt retailer with operations in the Republic of Ireland, the United Kingdom and the USA. The Group is pursuing a growth strategy focused on acquiring and developing new sites in each of the three markets in which it operates. As at 31 December 2017, the business operated 342 forecourt sites and employed c 4,900 people. 

 

The Group offers a distinctive convenience retail offering in the forecourt space with three key elements:

·     A "low fuel prices, always" price promise to drive footfall to the stores;

·     A "Better Value Always" tailored retail offer; and

·     A strong food and beverage focus aiming to offer premium products and service to the customer.

 

Applegreen has a number of strategic partnerships with international brands including Burger King, Subway, Costa Coffee, Greggs, Lavazza, Chopstix, Freshii and 7-Eleven.  The business also has its own food offer through the Bakewell café brand. 

 

Applegreen is the number one Motorway Service Area operator in the Republic of Ireland.

 

 

Conference call details - analysts and institutional investors

 

Applegreen plc will host a conference call for analysts and institutional investors today, 13 March, 2018 at 08.30 BST.  Presentation will be available on www.applegreenstores.com.  Dial in details are as follows:

 

Ireland Telephone Number:                       +353 (0)1 2465621

UK Telephone Number:                               +44 (0)330 336 9411

Passcode:                                                            1335725

 

For further enquiries, please contact:

 

Applegreen

Bob Etchingham (CEO)                                                                                  +353 (0) 1 512 4800

Niall Dolan (CFO)

 

Drury Porter Novelli:

Paddy Hughes                                                                                                   +353 (0) 1 260 5000

 

Shore Capital

Stephane Auton                                                                                               +44 (0) 20 7408 4090

Patrick Castle

 

Goodbody

Joe Gill                                                                                                                 +353 (0) 1 667 0420

Siobhan Wall

 

 

 

 Applegreen FY 2017 Performance Overview and Outlook

 

The performance for 2017 was driven by strong fuel margin in both the Republic of Ireland and the UK in the early part of the year, positive performance of recent acquisitions and good like for like growth in food and store.

 

A strong economic backdrop, together with our upgrade and rebranding activity, saw like for like food and store sales grow by 3.9% on a constant currency basis, with related gross profit up by 7.4% (constant currency).

 

During the period, we expanded our portfolio with 99 new sites, including 22 in the ROI, 20 in the UK and 57 in the USA. Of the total, 12 of these were dealer sites and 87 were company owned sites.

 

There were two significant group acquisitions in 2017, Brandi and Carsley, both of which completed in October 2017. The Brandi acquisition involved the takeover of a forecourt retail operation based in Columbia, South Carolina with 34 Petrol Filling Station sites and eight standalone Burger King restaurants.  The Carsley acquisition involved the takeover of seven Petrol Filling Station sites in the UK, a number of which offer potential to develop into larger Service Area facilities.

 

In addition, 18 sites were rebranded or upgraded in 2017, which involved adding one or more new food outlets at each site. This included four sites which were upgraded from Petrol Filling Stations to Service Areas.

 

This development activity has resulted in 77 additional branded food offers being added to our estate in the period, 35 of which were added as part of the Brandi acquisition.

 

Republic of Ireland

 

In the year ended 31 December 2017, revenue in the Republic of Ireland increased by 12.3% and gross profit increased by 16.5%. Total fuel gross profit increased by 21.1% compared to 2016 and increased by 13.5% on a like for like basis. This reflected the impact of a strong fuel margin environment in the first part of the year as well as the impact of the JFT acquisition in the latter part of the year. We completed the acquisition of 50% interest in the JFT in July 2017 for a purchase price of €15.7m. The terminal comprises a 20 acre site with storage capacity of 60,000 tonnes and is operated under a joint agreement with Valero.

 

Like for like food and store sales increased year on year by 4.6% and related gross profit grew by 7.8%.

 

During the period, we expanded our Republic of Ireland estate by 22 sites which included three Service Area sites, seven Petrol Filling Station sites and 12 dealer sites.

 

During the period, eight sites were rebranded or upgraded incorporating at least one new food offer in all cases. 88% of the ROI estate is now branded Applegreen (2016: 85%).

 

Our dealer and fuel card volumes have shown significant growth and now account for 28% of ROI fuel volumes on a combined basis.

 

 

United Kingdom

 

In the year ended 31 December 2017, revenue in the UK increased by 22.4% and gross profit by 19.7% largely due to the continued expansion of the estate (30.9% and 28.0%, respectively, on a constant currency basis).

 

Combined food and store sales and gross profit rose year on year by 15.2% and 20.6% respectively. On a like for like constant currency basis, these sales were 0.3% ahead of the same period last year while related gross profit grew by 4.2% reflecting good growth in food.

 

Total fuel gross profit in the UK increased by 18.6% compared to 2016 and increased by 4.1% on a like for like constant currency basis driven, primarily, by a stronger fuel margin environment in the early part of the year.

 

The Group opened five new Service Areas in the UK including one new Motorway Service Area in Lisburn, Northern Ireland, one new build Trunk Road Service Area in Spalding (A14) and also converted three Petrol Filling Stations sites to Trunk Road Service Areas during the year.

 

15 new Petrol Filling Stations were added in the UK in the period and seven existing stations were rebranded and expanded through the addition of new food offers. 51% of our UK estate is now branded Applegreen.

 

We are building a good pipeline of Service Area opportunities in the UK, which are at various stages of the planning process. 

 

We have continued to develop our relationship with Costa Coffee in the UK and opened six additional Costa Coffee cafés during 2017, one in our new site in Spalding and five as part of existing site upgrade and rebranding activities.

 

In October 2017, we completed the acquisition of a network of seven Petrol Filling Station sites from the Carsley Group for a consideration of €23.5m. The sites are well located on very busy roads with a number situated on the A1 which is a major arterial route. The transaction further expands our service area potential in the UK.

 

USA

 

During the period, the Group added 57 new sites in the USA, 42 in South Carolina and 15 in the North East.

In October 2017, we completed the acquisition of the Brandi Group sites which involved a leasehold arrangement with Getty Realty. The consideration paid by Applegreen was US$5.7m (excluding inventory acquired) (€5.0m) with Getty Realty acquiring certain property assets for US$68.3m. As part of the transaction, we acquired 42 sites located in Columbia, South Carolina, comprising 34 Petrol Filling Station sites and eight stand-alone Burger King restaurants. There are a further 11 Burger King restaurants in the Petrol Filling Station estate, which also incorporates other food-to-go offers such as Subway.

In the North East, 12 of the sites were added under our master agreements with CrossAmerica Partners. This now brings the total number of trading forecourts in the North East USA to 26 at 31 December 2017.

 

Costs

 

 

Selling and distribution expenses, excluding rent and depreciation rose by 24.5% year on year which is broadly in line with the increase in gross profit. Rent costs now incorporate lease rental for the South Carolina sites.  Administrative expenses, excluding share based payment expense, non-recurring costs and depreciation grew by 24.0% driven by business growth and further investment in management capacity.

 

Dividend

 

The Board has proposed a final dividend of 0.80 cent per share (€0.7m) which will be paid on 5 July 2018 to shareholders on the register as at 15 June 2018.

 

Outlook

 

We continue to develop our network in 2018 adding 11 sites in the year to date.  In the Republic of Ireland, we have opened a new Service Area in Meath. We also opened seven Petrol Filling Stations in the UK and three in the US.

 

We have a strong pipeline of further developments of both Service Area sites and Petrol Filling Stations across our markets.

 

 

 

UNAUDITED CONSOLIDATED INCOME STATEMENT

YEAR ENDED 31 DECEMBER 2017

 

 

Notes

 2017

 

 2016

 

 

€000

 

€000

Revenue

 

1,428,116

 

1,177,642

Cost of sales

5

(1,246,395)

 

(1,031,865)

Gross Profit

 

181,721

 

145,777

 

 

 

 

 

Selling and distribution costs

5

(130,301)

 

(103,947)

Administrative expenses

5

(30,543)

 

(24,004)

Other income

 

2,164

 

1,166

Finance costs

6

(1,494)

 

197

Finance income

6

420

 

325

Profit before income tax

 

21,967

 

19,514

 

 

 

 

 

Income tax expense

7

(3,311)

 

(2,280)

Profit for the financial year

 

18,656

 

17,234

 

Earnings per share from continuing operations attributable to the owners of the parent company during the year

 

 

 

 

 

Earnings per share - Basic

4

22.48c

 

21.52c

Earnings per share - Diluted

4

21.68c

 

20.63c

 

 

 

 

 

 

 

 

 

 

UNAUDITED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

YEAR ENDED 31 DECEMBER 2017

 

 

 2017

 

2016

 

€000

 

€000

Profit for the financial year

18,656

 

17,234

Other comprehensive expense

 

 

 

Items that may be reclassified to profit or loss

 

 

 

Currency translation differences on foreign operations

(2,769)

 

(3,720)

Other comprehensive expense for the year, net of tax

(2,769)

 

(3,720)

Total comprehensive income for the year

15,887

 

13,514

 

 

 

 

 

 

  

UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2017

 

Assets

Notes

2017

 

 2016

Non-current assets

 

€000

 

€000

Intangible assets

8

16,150

 

2,757

Property, plant and equipment

9

299,574

 

219,226

Investment in joint venture

 

1,000

 

-

Trade and other receivables

11

422

 

373

Deferred income tax asset

 

5,718

 

4,103

 

 

322,864

 

226,459

Current assets

 

 

 

 

Inventories

10

35,228

 

30,273

Trade and other receivables

11

21,798

 

19,726

Assets classified as held for sale

 

-

 

165

Current income tax receivables

 

88

 

80

Cash and cash equivalents

12

57,482

 

29,374

 

 

114,596

 

79,618

Total assets

 

437,460

 

306,077

 

 

 

 

 

Equity and Liabilities

 

 

 

 

Equity attributable to owners of the parent

 

 

 

 

Issued share capital

15

916

 

805

Share premium

 

190,464

 

140,268

Capital contribution

 

512

 

512

Merger reserve

 

(65,537)

 

(65,537)

Currency translation reserve

 

(6,818)

 

(4,049)

Share based payment reserve

 

8,181

 

5,349

Retained earnings

 

53,591

 

37,663

Total equity

 

181,309

 

115,011

 

 

 

 

 

Non-current liabilities

 

 

 

 

Trade and other payables

14

5,534

 

5,704

Borrowings

13

63,132

 

42,950

Deferred income tax liabilities

 

7,854

 

5,123

 

 

76,520

 

53,777

Current liabilities

 

 

 

 

Trade and other payables

14

173,528

 

130,948

Borrowings

13

4,545

 

5,849

Current income tax liabilities

 

1,558

 

492

 

 

179,631

 

137,289

Total liabilities

 

256,151

 

191,066

 

 

 

 

 

Total equity and liabilities

 

437,460

 

306,077

 

 

UNAUDITED Consolidated statement of changes in equity

AS AT 31 DECEMBER 2017

 

 

Issued share capital

Share premium

Capital contribution

Merger reserve

Foreign currency translation reserve

Share based payment reserve

Retained earnings

Total

 

€000

€000

€000

€000

€000

€000

€000

€000

At 01 January 2016

796

139,427

512

(65,537)

(329)

2,991

20,429

98,289

Profit for the year

-

-

-

-

-

-

17,234

17,234

Other comprehensive income

-

-

-

-

(3,720)

-

-

(3,720)

Total comprehensive income

-

-

-

-

(3,720)

-

17,234

13,514

Share based payments

-

-

-

-

-

1,441

-

1,441

Deferred tax on share based payments

-

-

-

-

-

917

-

917

Issue of ordinary share capital

9

841

-

-

-

-

-

850

At 31 December 2016

805

140,268

512

(65,537)

(4,049)

5,349

37,663

115,011

 

 

 

 

 

 

 

 

 

At 01 January 2017

805

140,268

512

(65,537)

(4,049)

5,349

37,663

115,011

Profit for the year

-

-

-

-

-

-

18,656

18,656

Other comprehensive income

-

-

-

-

(2,769)

-

-

(2,769)

Total comprehensive income

-

-

-

-

(2,769)

-

18,656

15,887

Share based payments

-

-

-

-

-

1,630

-

1,630

Deferred tax on share based payments

-

-

-

-

-

1,202

-

1,202

Issue of ordinary share capital (note 15)

111

50,196

-

-

-

-

(1,234)

49,073

Dividends

-

-

-

-

-

-

(1,494)

(1,494)

At 31 December 2017

916

190,464

512

(65,537)

(6,818)

8,181

53,591

181,309

 

 

 

 

 

 

 

 

 

 

 

 

 

UNAUDITED Consolidated statement of cash flows

YEAR ENDED 31 DECEMBER 2017

 

Notes

2017

 

2016

Cash flows from operating activities

 

€000

 

€000

Profit before income tax

 

21,967

 

19,514

Adjustments for:

 

 

 

 

Depreciation and amortisation

5

14,103

 

11,162

Finance income

6

(420)

 

(325)

Finance costs

6

1,494

 

(197)

Net impairment of non current assets

5

-

 

368

Share based payment expense

5

1,630

 

1,441

Gain on bargain purchase

 

(928)

 

-

Loss on the sale of property, plant and equipment

5

812

 

327

 

 

38,658

 

32,290

 

 

 

 

 

Increase in trade and other receivables

 

(561)

 

(4,734)

Increase in inventories

 

(1,692)

 

(7,386)

Increase in trade payables

 

42,666

 

28,923

Cash generated from operations

 

79,071

 

49,093

Income taxes paid

 

(1,608)

 

(1,404)

Net cash from operating activities

 

77,463

 

47,689

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Purchase of property, plant and equipment

 

(76,115)

 

(60,763)

Purchase of intangibles

 

(5,210)

 

(1,371)

Proceeds from sale of property, plant and equipment

 

167

 

423

Purchase of subsidiary undertakings

 

(31,233)

 

-

Investment in joint venture

 

(1,000)

 

-

Interest received

 

400

 

190

Net cash used in investing activities

 

(112,991)

 

(61,521)

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Proceeds from long-term borrowings

 

45,000

 

-

Proceeds from issue of ordinary share capital

 

49,071

 

850

Repayment of borrowings

 

(23,666)

 

(3,305)

Payment of finance lease liabilities

 

(787)

 

(1,028)

Interest paid

 

(1,768)

 

(1,907)

Dividends paid

 

(1,494)

 

-

Net cash used in financing activities

 

66,356

 

(5,390)

 

 

 

 

 

Net increase/(decrease) in cash and cash equivalents

 

30,828

 

(19,222)

Cash and cash equivalents at beginning of year

 

27,739

 

47,245

Foreign exchange losses

 

(1,085)

 

(284)

Cash and cash equivalents at end of year

12

57,482

 

27,739

 

 

 

 

 

 

Notes to the unaudited consolidated financial information

 

1.    General information and basis of preparation

Applegreen plc ('the Company') is a company incorporated in the Republic of Ireland. The Unaudited Consolidated Financial Information of the Company for the year ended 31 December 2017 (the 'Financial Information') include the Company and its subsidiaries (together referred to as the 'Group'). The Company is incorporated and tax resident in Ireland. The address of its registered office is Block 17, Joyce Way, Parkwest, Dublin 12.

 

The Consolidated Financial Statements of the Group are prepared in accordance with Irish law and International Financial Reporting Standards ('IFRS') and their interpretations issued by the International Accounting Standards Board ('IASB') and adopted by the European Union ('EU'). The financial information in this report has been prepared in accordance with the Group's accounting policies. Full details of the accounting policies adopted by the Group are contained in the Consolidated Financial Statements included in the Group's annual report for the year ended 31 December 2016 which is available on the Group's website; http://applegreenstores.com.

 

The accounting policies and methods of computation and presentation adopted in the preparation of the Financial Information are consistent with those described and applied in the annual report for the year ended 31 December 2016 except as explained in Note 2 below. There are no new IFRSs or interpretations effective from 01 January 2017 which have had a material effect on the financial information included in this report.

 

The financial information presented in this report does not represent full statutory accounts. The preliminary release was approved by the Board of Directors. The annual report and accounts will be approved by the Board of Directors and reported on by the auditors in due course. Accordingly, the financial information is unaudited. Full statutory accounts for the year ended 31 December 2016 have been filed with the Irish Registrar of Companies. The audit report on those statutory accounts was unqualified.

 

The Financial Information is presented in Euro, rounded to the nearest thousand, which is the functional currency of the parent company and also the presentation currency of the Group.

 

The preparation of the Financial Information requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Actual results could differ materially from these estimates. In preparing the Financial Information, the critical judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the year ended 31 December 2016 as set out on pages 65 to 74 in those financial statements.

 

 

 

Notes to the unaudited consolidated financial information

 

2. Significant accounting policies

The accounting policies applied in the Financial Information are consistent with those applied in the consolidated financial statements as at and for the year ended 31 December 2016, and are described in those financial statements on pages 65 to 73, except for the addition of the standards described below:

 

Business Combinations

Business combinations are accounted for using the acquisition method as at the date of acquisition.

 

In accordance with IFRS 3 Business Combinations, the fair value of consideration paid for a business combination is measured as the aggregate of the fair values at the date of exchange of assets given and liabilities incurred or assumed in exchange for control. Any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date. Subsequent changes to the fair value of the contingent consideration will be recognised in accordance with IAS 39 'Financial Instruments: Recognition and Measurement' in the income statement.

 

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date except for deferred tax assets or liabilities and assets or liabilities related to employee benefit arrangements which are recognised and measured in accordance with IAS 12 'Income Taxes' and IAS 19 'Employee Benefits' respectively. The fair value of the assets and liabilities are based on valuations using assumptions deemed by management to be appropriate. Professional valuers are engaged when it is deemed appropriate to do so.

 

If the business combination is achieved in stages, the acquisition date fair value of the Group's previously held investment in the acquiree is remeasured to fair value at the acquisition date through profit or loss.  For each business combination, the Group elects whether to measure the non-controlling interests in the acquiree at fair value or at the proportionate share of the acquiree's identifiable net assets. Acquisition-related costs are expensed as incurred and included in administrative expenses.

 

Goodwill

Goodwill arises on business combinations and represents the difference between the fair value of the consideration and the fair value of the Group's share of the identifiable net assets of a subsidiary at the date of acquisition.

 

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognised for non-controlling interests, and any previous interest held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Group re-assesses whether it has correctly identified all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognised at the acquisition date. If the reassessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognised in profit or loss.

 

 

 

Notes to the unaudited consolidated financial information

 

2. Significant accounting policies (continued)

 

Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. On acquisition, goodwill is allocated to cash-generating units expected to benefit from the combination's synergies. Goodwill is tested annually for impairment or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Any impairment is recognised immediately in profit or loss.

 

Goodwill arising on investments in joint ventures is included in the carrying amount of the investment and any impairment of the goodwill is included in income from joint ventures. On disposal of a subsidiary, the attributable amount of goodwill, not previously written off to reserves, is included in the calculation of the profit or loss on disposal.

 

Investment in joint operations

Joint operations are arrangements where the parties that have joint control of the arrangement have rights to the assets and obligations for the liabilities relating to the arrangement. The activities are undertaken by the Group in conjunction with other joint operators that involve the use of the assets and resources of those joint operators.

 

3. Segmental analysis

Applegreen plc is a forecourt retail business headquartered in Dublin, Ireland. Operating segments are reported in a manner consistent with internal reporting provided to the Chief Operating Decision Maker (CODM). The CODM has been identified as the Board of Executive Directors.

 

The board considers the business from both a geographic and product perspective. Geographically, management considers the performance in Ireland, the UK and the USA. From a product perspective, management separately considers retail activities in respect of the sale of fuel, food and other groceries within Ireland, the UK and in the USA.

 

The Group is organised into the following operating segments:

Retail Ireland - Involves the sale of fuel, food and store within the Republic of Ireland.

Retail UK - Involves the sale of fuel, food and store within the United Kingdom.

Retail USA - Involves the sale of fuel, food and store within the United States of America.

 

The CODM monitors Revenue and Gross Profit of segments separately in order to allocate resources between segments and to assess performance.

 

Information regarding the results of each reportable segment is included within this note. Segment performance measures are revenue and gross profit as included in the internal management reports that are reviewed by the executive directors. These measures are used to monitor performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. The CODM also reviews adjusted EBITDA on a consolidated basis. Assets and liabilities are reviewed by the CODM for the Group in its entirety and as such segment information is not provided for these items.

 

 

 

 

Notes to the unaudited consolidated financial information

 

3. Segmental analysis (continued)

 

Analysis of Revenue and Gross Profit

2017

IRL

UK

USA

Total

Revenue

€000

€000

€000

€000

Fuel

581,617

500,578

62,973

1,145,168

Food

76,590

21,305

5,782

103,677

Store

120,515

47,288

11,468

179,271

 

778,722

569,171

80,223

1,428,116

Gross Profit

 

 

 

 

Fuel

39,227

22,183

6,674

68,084

Food

44,893

10,828

3,467

59,188

Store

36,306

14,310

3,833

54,449

 

120,426

47,321

13,974

181,721

 

 

 

 

 

 

Analysis of Revenue and Gross Profit

2016

IRL

UK

USA

Total

Revenue

€000

€000

€000

€000

Fuel

515,762

405,517

16,240

937,519

Food

68,019

17,223

4

85,246

Store

109,652

42,332

2,893

154,877

 

693,433

465,072

19,137

1,177,642

Gross Profit

 

 

 

 

Fuel

32,405

18,699

1,892

52,996

Food

39,444

8,640

-

48,084

Store

31,525

12,208

964

44,697

 

103,374

39,547

2,856

145,777

 

Reconciliation of profit before income tax to earnings before interest, tax, depreciation and amortisation (EBITDA), share based payments and other non-recurring charges (Adjusted EBITDA):

 

 

Notes

2017

 

2016

 

 

€000

 

€000

Profit before income tax

 

21,967

 

19,514

Depreciation

5

13,661

 

10,890

Amortisation

5

442

 

272

Net impairment charge

5

-

 

368

Net finance cost

6

1,074

 

(522)

EBITDA

 

37,144

 

30,522

Share based payments

5

1,630

 

1,441

Non-recurring charges

5

1,005

 

-

Adjusted EBITDA

 

39,779

 

31,963

 

 

 

 

Notes to the unaudited consolidated financial information

 

4. Earnings per share

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the company by the weighted average number of ordinary shares in issue during the year.

 

Basic earnings per share

 2017

 

 2016

Profit from continuing operations attributable to the owners of the Company (€'000)

18,656

 

17,234

Weighted average number of ordinary shares in issue for basic earnings per share ('000)

83,000

 

80,077

Earnings per share - Basic (cent)

22.48

 

21.52

 

 

 

 

 

Diluted earnings per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares which comprise share options issued under the share incentive plan.

 

Diluted earnings per share

2017

 

2016

Profit from continuing operations attributable to the owners of the Company (€'000)

18,656

 

17,234

Weighted average number of ordinary shares in issue for basic earnings per share ('000)

83,000

 

80,077

Adjusted for:

 

 

 

Share options ('000)

3,060

 

3,471

Weighted average number of ordinary shares for diluted earnings per share ('000)

86,060

 

83,548

Earnings per share - Diluted (cent)

21.68

 

20.63

 

 

 

Notes to the unaudited consolidated financial information

 

5. Expenses

Profit before tax is stated after charging/(crediting):

 

2017

 

2016

 

€000

 

€000

Cost of inventory recognised as expense

1,220,265

 

1,011,203

Other external charges

26,130

 

20,662

Employee benefits

77,990

 

63,994

Share based payment charge (1)

1,630

 

1,441

Operating leases

18,309

 

13,912

Amortisation of intangible assets

442

 

272

Depreciation of property, plant and equipment

13,661

 

10,890

Net foreign exchange (gain)/loss

(268)

 

381

Net impairment charge

-

 

368

Loss on disposal of assets

812

 

327

Utilities

6,794

 

5,560

Rates

5,617

 

4,818

Non recurring charges (2)

1,005

 

-

Other operating charges

34,852

 

25,988

 

1,407,239

 

1,159,816

 

(1) Included in the charge of €1.6m (2016: €1.4m) for share based payments is a charge of €0.3m (2016: €0.5m) in respect of share options granted during the year under a new share option scheme.

 

(2) Non recurring charges relates to acquisition costs of €1.9m incurred during 2017 offset by a gain of €0.9m in respect of the fair value of net assets acquired over the aggregate consideration transferred arising from the Brandi Group acquisition.

 

6. Finance costs and income

 

2017

 

2016

Finance costs

€000

 

€000

Bank loans and overdrafts

1,718

 

1,485

Variance on translation of foreign borrowings *

(345)

 

(1,724)

Lease finance charges and hire purchase interest

319

 

308

Borrowing costs capitalised

(198)

 

(266)

 

1,494

 

(197)

 

Finance income

 

 

 

Interest income on loans to joint ventures

(416)

 

(321)

Interest income on loans to staff

(4)

 

(4)

 

(420)

 

(325)

Net finance cost/(income)

1,074

 

(522)

 

* The foreign exchange gains arises primarily in respect of non-Euro denominated debt.

 

 

 

Notes to the unaudited consolidated financial information

 

7. Taxation

 

2017

 

2016

Current tax

€000

 

€000

Current tax expense - Ireland

1,232

 

834

Current tax expense - overseas

1,234

 

860

Adjustments in respect of previous periods

(220)

 

216

Total current tax

2,246

 

1,910

Deferred tax

 

 

 

Origination and reversal of temporary differences

1,065

 

370

Total deferred tax

1,065

 

370

Total tax

3,311

 

2,280

 

The total tax expense can be reconciled to accounting profit as follows:

 

 

2017

 

2016

 

€000

 

€000

Profit before tax from continuing operations

21,967

 

19,514

Income tax at 12.5%

2,746

 

2,439

 

 

 

 

Non tax deductible expenses

1,786

 

342

Non-taxable income

(1,461)

 

(1,039)

Income taxable at higher rates

460

 

322

Adjustments in respect of previous periods

(220)

 

216

Total tax expense

3,311

 

2,280

 

Notes to the unaudited consolidated financial information

 

8. Intangible assets

 

Goodwill

Branding

Operating agreements

Franchises

Licences

Assets under construction

Total

Cost

€000

€000

€000

€000

€000

€000

€000

At 01 January 2017

-

-

518

1,157

1,513

512

3,700

Additions

-

-

79

516

272

4,902

5,769

Acquisitions

3,736

455

-

4,202

-

-

8,393

Disposals

-

-

-

(94)

(173)

-

(267)

Translation adjustment

(45)

(26)

-

(260)

(5)

-

(336)

At 31 December 2017

3,691

429

597

5,521

1,607

5,414

17,259

 

 

 

 

 

 

 

 

Amortisation

 

 

 

 

 

 

 

At 01 January 2017

-

-

98

229

616

-

943

Disposals

-

-

-

(94)

(173)

-

(267)

Amortisation charge

-

23

106

157

156

-

442

Translation adjustment

-

(2)

-

(6)

(1)

-

(9)

At 31 December 2017

-

21

204

286

598

-

1,109

 

 

 

 

 

 

 

 

Net Book Value

 

 

 

 

 

 

 

31 December 2017

3,691

408

393

5,235

1,009

5,414

16,150

01 January 2017

-

-

420

928

897

512

2,757

 

Notes to the unaudited consolidated financial information

 

9. Property, plant and equipment

 

Land and Buildings

Plant and equipment

Fixtures, fittings and motor vehicles

Computer hardware and software

Assets under construction

Total

Cost

€000

€000

€000

€000

€000

€000

At 01 January 2017

166,416

16,299

69,316

10,723

17,644

280,398

Additions

30,090

14,864

19,319

2,153

9,594

76,020

Acquisitions

19,568

2,258

963

71

-

22,860

Disposals

(919)

(448)

(8,804)

(1,913)

(733)

(12,817)

Reclassifications

7,532

297

1,064

209

(9,102)

-

Translation adjustment

(2,574)

(381)

(943)

(90)

(302)

(4,290)

At 31 December 2017

220,113

32,889

80,915

11,153

17,101

362,171

 

 

 

 

 

 

 

Depreciation/impairment

 

 

 

 

 

 

At 01 January 2017

32,490

2,743

21,510

4,429

-

61,172

Charge for the year

2,913

1,272

7,428

2,048

-

13,661

Disposals

(866)

(404)

(8,610)

(1,890)

-

(11,770)

Translation adjustment

(218)

(26)

(186)

(36)

-

(466)

At 31 December 2017

34,319

3,585

20,142

4,551

-

62,597

 

 

 

 

 

 

 

Net Book Value

 

 

 

 

 

 

31 December 2017

185,794

29,304

60,773

6,602

17,101

299,574

01 January 2017

133,926

13,556

47,806

6,294

17,644

219,226

 

Assets under construction as at 31 December 2017 includes the following significant projects; eight service stations in the Republic of Ireland (€13.5m), one motorway services area in Northern Ireland (€0.7m) and one service station in the US (€1.1m). The remaining amounts relate to several other developments across all regions.

 

Notes to the unaudited consolidated financial information

 

10. Inventories

 

2017

 

2016

 

€000

 

€000

Raw materials and consumables

1,203

 

981

Finished goods

34,025

 

29,292

 

35,228

 

30,273

 

The cost of inventories recognised as an expense and included in 'cost of sales' amounted to €1,220m (2016: €1,011m).

 

11. Trade and other receivables

 

2017

 

2016

Current

€000

 

€000

Trade receivables

8,112

 

4,834

Provision for impairment

(242)

 

(265)

Deposits received from customers

(83)

 

(45)

Net trade receivables

7,787

 

4,524

Accrued income

2,822

 

2,561

Prepayments

5,764

 

3,455

Other debtors

2,980

 

5,161

Withholding tax receivable

24

 

24

VAT receivable

11

 

1,355

Amounts due from related companies

2,410

 

2,646

 

21,798

 

19,726

Non-current

 

 

 

Other debtors

422

 

373

 

422

 

373

 

Current trade and other receivables are non-interest bearing and are generally less than 30 day credit terms. Non-current debtors relates to loans advanced to our dealer network. The fair values of non-current trade and other receivables is equivalent to their carrying value. The fair value has been determined on the basis of discounted cash flows.

 

 

Notes to the unaudited consolidated financial information

 

12. Cash and cash equivalents

Cash and cash equivalents included in the Consolidated Statement of Financial Position and Consolidated Statement of Cash Flows are analysed as follows:

 

 

2017

 

2016

 

€000

 

€000

Cash at bank

40,815

 

21,002

Cash in transit

16,667

 

8,372

Cash and cash equivalents (excluding bank overdrafts)

57,482

 

29,374

 

Cash and cash equivalents include the following for the purposes of the statement of cash flows:

 

 

2017

 

2016

 

€000

 

€000

Cash and cash equivalents

57,482

 

29,374

Bank overdrafts (note 13)

-

 

(1,635)

 

57,482

 

27,739

 

13. Borrowings

 

2017

 

2016

Current

€000

 

€000

Bank overdrafts

-

 

1,635

Bank loans

3,820

 

3,465

Finance leases

725

 

749

 

4,545

 

5,849

Non-current

 

 

 

Bank loans

60,615

 

39,723

Finance leases

2,517

 

3,227

 

63,132

 

42,950

Total borrowings

67,677

 

48,799

 

During the year, the Group drew down loans of €45m and repaid €24m. The funds received were used to further expand the operations of the Group.

 

The Group also extended its banking arrangements with its senior lenders, Ulster Bank Ireland and Allied Irish Bank plc. These new arrangements increased the facilities available to the Company by €20m.

 

 

 

Notes to the unaudited consolidated financial information

 

14. Trade and other payables

 

 

2017

 

2016

Current

€000

 

€000

Trade payables and accruals

163,477

 

126,105

Other creditors

3,121

 

1,073

Deferred income

824

 

1,045

Value added tax payable

2,637

 

396

Other taxation and social security

3,140

 

1,910

Amounts due to related parties

329

 

419

 

173,528

 

130,948

 

 

 

 

Deferred income

5,534

 

5,704

 

5,534

 

5,704

 

15. Share capital

 

Ordinary

 

No.

 

Authorised Shares of €0.01 each

 

 

 

At 31 December 2016

1,000,000,000

 

10,000,000

At 31 December 2017

1,000,000,000

 

10,000,000

 

 

 

 

Issued Shares of €0.01 each

 

 

 

At 01 January 2017

80,471,053

 

804,710

Allotted

11,087,105

 

110,871

At 31 December 2017

91,558,158

 

915,581

 

During 2017, the Company issued 8,082,105 ordinary shares of €0.01 at an issue price of €5.80/£5.09 per share, resulting in gross proceeds of €46.3 million. Share premium of €46.2m was recorded on these shares. Directly attributable issue costs of €1.2m have been deducted from retained earnings.

 

3,005,000 share options were exercised during 2017.  Share premium of €4m was recorded on these shares.

 

These funds have been used and will be used to further expand the Group.

 

 

Notes to the unaudited consolidated financial information

 

16. Business combinations

In October 2017, the Group acquired both the Brandi Group, a 42-site retail operation based in South Carolina, USA and the Carsley Group, a seven-site forecourt retail operation based in the UK.

 

The Group acquired the trade and assets of the Brandi Group for a consideration of €8.2m. In accordance with IFRS 3 Business Combinations, this transaction constituted an acquisition of a business and therefore, was accounted for under this standard.

 

The Group also acquired the Carsley Group for a consideration of €23.5m. The Group purchased 100% of the share capital of the following entities:

·     BMC Petroleum Limited

·     MCM Forecourts Limited

·     Wyboston Service Station Limited

·     Cromwell Service Station Limited

·     Muskham Services Limited

·     Casterton Hill Service Station Limited

·     MCM Sandwiches Limited

 

The provisional fair values of the acquired assets and liabilities at acquisition are set out below:

 

Brandi Group

 

Carsley Group

 

Total

 

€000

 

€000

 

€000

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

Intangible assets

4,640

 

17

 

4,657

Property, plant and equipment

1,334

 

21,526

 

22,860

 

 

 

 

 

 

Current assets

 

 

 

 

 

Inventories

3,120

 

780

 

3,900

Trade and other receivables

-

 

1,580

 

1,580

 

 

 

 

 

 

Current liabilities

 

 

 

 

 

Trade and other payables

-

 

(2,424)

 

(2,424)

Current income tax liabilities

-

 

(443)

 

(443)

 

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

Deferred income tax liabilities

-

 

(1,308)

 

(1,308)

 

 

 

 

 

 

Total identifiable assets

9,094

 

19,728

 

28,822

 

 

 

 

 

 

Goodwill

-

 

3,736

 

3,736

Fair value gain

(928)

 

-

 

(928)

Total consideration

8,166

 

23,464

 

31,630

 

 

 

 

 

 

Satisfied by:

 

 

 

 

 

Cash (net of cash acquired)

8,166

 

23,067

 

31,233

Deferred consideration

-

 

397

 

397

 

8,166

 

23,464

 

31,630

 

 

 

Notes to the unaudited consolidated financial information

 

16. Business combinations (continued)

The fair value gain of €0.9m is shown within non recurring charges offset against acquisition-related costs of €1.9m. These are included within administrative expenses in the Consolidated Income Statement.

 

The initial assignment of fair values to identifiable net assets acquired has been performed on a provisional basis in respect of a number of the business combinations above given their proximity to year-end. Any amendments to these fair values within the twelve month timeframe from the date of acquisition will be disclosable in the 2018 Annual Report, as stipulated by IFRS 3.

 

The deferred consideration reflects the final consideration made in respect of preacquisition working capital which was outstanding at the year end. This has now been agreed with the sellers and was paid in Q1 2018.

 

No contingent liabilities were recognised on the acquisitions completed during the year.

 

17. Post period end events

Since the year end, the Group has added one new service area in the Republic of Ireland, seven petrol filling stations in the UK and three petrol filling stations in the USA. The Group will continue to pursue new developments to enhance shareholder value, through a combination of organic growth, acquisitions and development opportunities.

 

The Directors have proposed a final dividend in respect of the 2017 financial year of 0.80 cent per ordinary share, €0.7m in total. This dividend has not been provided for in the Group balance sheet as there was no present obligation to pay the dividend at the year end. The final dividend is subject to approval by the Company's shareholders at the Annual General Meeting.

 

 

 

Glossary of financial terms

The key financial terms used by the Group in this report are as follows:

Measure

 

Description

Constant currency

 

Constant currency measure eliminates the effects of exchange rate fluctuations that occur when calculating financial performance numbers. They are calculated by taking the current year figures and applying the prior year exchange rates.

 

EBITDA and adjusted EBITDA

 

EBITDA is defined as earnings before interest, tax, depreciation, amortisation and impairment charges.

 

Adjusted EBITDA refers to EBITDA adjusted for share based payments and non-recurring items. The adjusted EBITDA calculation can be found on page 15.

 

Adjusted PBT

Adjusted PBT is defined as profit before tax adjusted for share based payments and non-recurring items.

 

Adjusted PBT is calculated as follows:

 

2017

 

2016

 

€000

 

€000

Profit before tax

21,967

 

19,514

Share based payments

1,630

 

1,441

Non-recurring charges

1,005

 

-

Adjusted PBT

24,602

 

20,955

 

Adjusted EPS

Adjusted EPS is calculated using the profit for the financial year adjusted for share based payments and non-recurring items divided by the weighted average number of ordinary shares in issue for basic earnings per share.

Adjusted EPS is calculated as follows:

 

2017

 

2016

 

€000

 

€000

Profit for the financial year

18,656

 

17,234

Share based payments

1,630

 

1,441

Non-recurring charges

1,005

 

-

Adjusted PBT

21,291

 

18,675

 

 

 

 

Weighted average number of ordinary shares ('000)

83,000

 

80,077

Adjusted EPS

25.65

 

23.32

 

 

Like for like

 

Like for like statistics measure the performance of stores that were open at 01 January 2016 and excluding any stores that were closed or divested since that date.

 

Net debt position

 

Net debt position comprises current and non-current borrowings and cash and cash equivalents.

 


This information is provided by RNS
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