Regulatory Story
Go to market news section View chart   Print
RNS
boohoo.com plc  -  BOO   

Final Results

Released 07:00 26-Apr-2017

RNS Number : 3240D
boohoo.com plc
26 April 2017
 

For Immediate Release                                                                        26 April 2017

 

 

 

 

boohoo.com plc - final results for the year ended 28 February 2017

 

"Leading the fashion eCommerce market"

 

£000

Year ended 28 February 2017

Year ended 29 February 2016

Change

 

Revenue

294,635

195,394

+51%

Gross profit

160,829

112,911

+42%

  Gross margin

54.6%

57.8%

-320bps

Operating profit

30,308

15,046

+101%

Adjusted EBITDA(1)

35,563

18,711

+90%

Profit before tax

30,945

15,674

+97%

 

 

 

 

Net cash(2) at year end

58,420

58,281

+£0.1m

Basic earnings per share

2.19p

1.11p

+97%

 

 

 

 

 

(1): Adjusted EBITDA is calculated as profit before tax, interest, depreciation, amortisation, share-based payment charges and option gain on PrettyLittleThing acquisition.

(2) Net cash is cash less borrowings.

 

Financial Highlights

Group

·     Revenue £294.6 million (2016: £195.4 million)

·     Gross margin 54.6% (2016: 57.8%)

·     Adjusted EBITDA £35.6 million, 12.1% of revenue (2016: £18.7 million, 9.6%)

·     Profit before tax £30.9 million (2016: £15.7 million)

·     Strong balance sheet with net cash of £58.4 million (2016: £58.3 million), after capital expenditure and acquisition of Nasty Gal

 

boohoo

·     Revenue £283.4 million, up 45% (44% CER(1))

UK up 33%, rest of Europe up 50% (44% CER), USA up 140% (119% CER), rest of world up 40% (42% CER)

39% (2016: 33%) of revenue is generated outside the UK

·     Gross margin 54.5%, down 330bps, driven by planned investments in the customer proposition (retail gross margin 56.1% (2016: 58.8%))

 

PrettyLittleThing

               Results from 3 January 2017:

·     Revenue £11.2 million

·     Strong growth of revenue and active customers

·     Gross margin 57.5%

 

 

Operational Highlights

Group

·     Acquisition of majority interest in PrettyLittleThing on 3 January 2017

·     Acquisition of the intellectual property of Nasty Gal on 28 February 2017

·     Warehouse extension completed and in use

boohoo

·     5.2 million active customers(2), up 29% on prior year

·     UK, USA and Australian apps launched and responsive websites introduced for European sites, improving mobile and tablet offering (now 70% of sessions)

·     USA, Ireland and Europe websites migrated to new platform

·     International growth accelerated through focus on key markets

·     Expansion of product range driving growth and brand appeal

PrettyLittleThing

·     Acquisition of majority interest, results incorporating two months of profitable trading

·     1.3 million active customers

·     Investment in new offices and upgraded systems

·     Increasing international exposure

·     Building a successful team to support rapid growth

 

 (1): CER designates Constant Exchange Rate translation of foreign currency revenue.

 (2): Active customers defined as having shopped in the last year.

 

Mahmud Kamani and Carol Kane, joint CEOs, commented:

"It has been a momentous year for us, with strong results and the acquisitions of PrettyLittleThing on 3 January 2017 and the Nasty Gal brand on 28 February 2017. Both brands have huge potential and the acquisitions represent a step change in the size, structure and operation of the group. We are confident that our expertise combined with the strength and following of our new complementary brands will greatly enhance the group's future growth and profitability.

The boohoo brand has achieved outstanding revenue growth and increased profitability margins during the year. We continued to grow strongly in the UK, our largest market, whilst international growth exceeded our expectations, particularly in the USA. Our customer proposition is proving consistently appealing.

PrettyLittleThing showed strong revenue growth in two months' of profitable trading since acquisition.

This year has also seen some major capital and infrastructure expenditure. We invested in a large warehouse extension and additional office space to provide for our planned further growth and we have secured planning permission for the next stage of the warehouse expansion. We have also invested in a new website platform for boohoo, which has brought many improvements, including website flexibility and response times.

Trading in the first few weeks of the 2018 financial year has made a promising start and we are excited about the prospects of our development into a multi-branded business. We expect group revenue growth approaching 50%(3) over 2017, which includes growth from the recent acquisitions,  and a group EBITDA margin of approximately 10%."

 

(3)  Revenue growth from the boohoo brand is expected to be approximately 25% year on year. Revenue growth from the PrettyLittleThing brand is expected to be approximately 35% above the 12 month revenue to 28 February 2017 of £55 million. The balance of the growth to approaching 50% will come from the Nasty Gal brand.

 

 

 

Investor and Analyst Meeting

 

A meeting for analysts will be held today at the office of Buchanan, 107 Cheapside, London, EC2V 6DN commencing at 9.30am. boohoo.com plc's results 2017 are available at www.boohooplc.com.

 

A live audio webcast will be available at 9.30am via the following link: http://vm.buchanan.uk.com/2017/boohoo260417/registration.htm

 

A replay will subsequently be available from 12 noon via the same link. 

 

Enquiries

boohoo.com plc

Neil Catto, Chief Financial Officer

Clara Melia, Investor Relations

 

Tel: +44 (0)161 233 2050

Tel: +44 (0)7748 171236

 

Zeus Capital - Nominated adviser and joint broker

Nick Cowles/Andrew Jones (Corporate Finance)

John Goold/Benjamin Robertson (Corporate Broking)

 

Tel: +44 (0)161 831 1512

Tel: +44 (0)20 3829 5000

Jefferies Hoare Govett - Joint broker

Nick Adams/Max Jones

 

Tel: +44 (0)20 7029 8000

 

Buchanan - Financial PR adviser

Richard Oldworth/Madeleine Seacombe/

Jane Glover

Tel: +44 (0)20 7466 5000

boohoo@buchanan.uk.com

About boohoo.com plc

 

"Leading the fashion eCommerce market"

 

Founded in Manchester in 2006, the group started life as boohoo.com, an inclusive and innovative brand targeting young, value-orientated customers. For over 10 years, boohoo has been pushing boundaries to bring its customers up-to-date and inspirational fashion, 24/7. boohoo has grown rapidly in the UK and internationally,  expanding its offering with range extensions into menswear and children's wear, through boohooMAN and boohooKIDS. 

 

In early 2017 the Group has extended its customer offering through the acquisitions of the vibrant fashion brand PrettyLittleThing, and free-thinking brand Nasty Gal. United by a shared customer value proposition, our brands design, source, market and sell great quality clothes, shoes and accessories at unbeatable prices. This investment proposition has helped us grow from a single brand, into a major multi-brand online retailer, leading the fashion eCommerce market for 16 to 30-year-olds around the world. Today the Boohoo Group sells to over 6 million customers in almost every country in the world. 

 

This announcement has been determined to contain inside information. 

 

Cautionary Statement

 

Certain statements included or incorporated by reference within this announcement may constitute "forward-looking statements" in respect of the group's operations, performance, prospects and/or financial condition. Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words and words of similar meaning as "anticipates", "aims", "due", "could", "may", "will", "should", "expects", "believes", "intends", "plans", "potential", "targets", "goal" or "estimates". By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions and actual results or events may differ materially from those expressed or implied by those statements. Accordingly, no assurance can be given that any particular expectation will be met and reliance should not be placed on any forward-looking statement. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. No responsibility or obligation is accepted to update or revise any forward-looking statement resulting from new information, future events or otherwise. Nothing in this announcement should be construed as a profit forecast. This announcement does not constitute or form part of any offer or invitation to sell, or any solicitation of any offer to purchase any shares or other securities in the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment or investment decisions relating thereto, nor does it constitute a recommendation regarding the shares or other securities of the Company. Past performance cannot be relied upon as a guide to future performance and persons needing advice should consult an independent financial adviser. Statements in this announcement reflect the knowledge and information available at the time of its preparation. Liability arising from anything in this announcement shall be governed by English law. Nothing in this announcement shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws.

 

Review of the business

"Revenue growth across all brands was robust, whilst margins increased, leading to a doubling of profit before tax."

Overview

Group revenue for the year increased to £294.6 million, an increase of 51% (49% CER) on the previous year. Revenue includes two months of trading from PrettyLittleThing, of which a 66% interest was acquired on 3 January 2017, with revenues amounting to £11.2 million.

Adjusted EBITDA was £35.6 million (2016: £18.7 million), an increase of 90% on the prior year with overhead efficiencies leading to an improvement in adjusted EBITDA margins to 12.1% (2016: 9.6%). Profit before tax was £30.9 million (2016: £15.7 million), an increase of 97%.

Earnings per share rose to 2.19p, an increase of 97% (2016: 1.11p).

During the year boohoo and PrettyLittleThing both performed extremely well in the UK and overseas and we are very encouraged by the prospects of rapid growth in our key markets. The performance of each brand is discussed in more detail below.

boohoo, PrettyLittleThing and, from the 2018 financial year onwards, Nasty Gal will operate independently of each other from a brand perspective, with separate management teams and a distinct customer proposition, whilst leveraging the over-arching benefits of the group and shared service functions.

The company has an option to buy the non-controlling interest of 34% of the share capital of PrettyLittleThing.com Limited on 14 March 2022 for market value or less, subject to performance criteria.

 

boohoo

Performance

Revenue for the year increased to £283.4 million, up 45% (44% CER) on the previous year.

Growth in the UK, our largest market, was 33%, with revenue reaching £173.2 million.

In overseas markets, our growth has been very robust. In the USA, growth was 140% (119% CER) and revenue was £39.6 million, driven by our successful customer proposition and the cumulative benefits of effective marketing to grow the customer base. Growth in the rest of Europe was 50% (44% CER) and in the rest of the world was 40% (42% CER).

Additional breadth in the product range has contributed to revenue growth, with several new product categories introduced in the year. A key focus during the year has been on the efficiency of marketing and overheads, which have been reduced as a percentage of revenue.

 

Fashion

Our aim is to offer the customer the best prices and the widest choice in fashion. We stock over 29,000 styles and keep this offering fresh and up-to-date with the very latest fashion trends with over 100 new styles arriving each week. Our test-and-repeat model reduces stock holding risk, whilst rapid response enables us to reorder strong selling lines to quickly satisfy demand.

The performance of core womenswear ranges of dresses, tops, jackets and footwear has continued to be strong, whilst our continually expanding ranges have generated robust revenue growth: plus-size and petite have grown strongly and attained a high level of revenue and the more recently-introduced tall and lingerie ranges have made a very promising start.

The "Stylefix" section of the website is the place where female customers can enjoy keeping up with fashion trends through highly engaging lifestyle content. Customers can get fashion tips, watch videos and read interesting articles by bloggers as well as contributing to the site themselves.

Menswear sales have doubled over the previous year as the product range has expanded and the launch of the separate boohooMAN website earlier in the year helped better focus the proposition on a male audience. The boohooMAN site has an appealing fashion and lifestyle section, the MANual, which further enriches the shopping experience.

In the second half of the year we introduced boohooKIDS, a range of children's clothing for girls and boys in the 5 to 12 age range, which was highly successful. We also introduced a small maternity range. We plan to build on the early success of these ranges in 2017.

 

Marketing

Our highly successful "WeAreUs" campaigns continue to promote brand visibility across TV, traditional media, events and social media channels.  The campaigns have become synonymous with the brand and continue to contribute to attract new customers whilst also ensuring existing customers are constantly engaged with the brand. We continue to make use of social media platforms for marketing and our campaigns are used alongside the ongoing blogger, influencer and ambassador outreach. This delivers bespoke user-generated content, promoting the brand and the latest products on both boohoo and third party influencer channels. The influencer community continues to play an integral part in our marketing efforts and we have worked with hundreds of bloggers and influencers across our key geographic markets in the last twelve months.

boohoo contributors and student ambassador programmes complement the ongoing outreach, helping us to develop new talent in the ever-changing influencer landscape.  Contributors and ambassadors deliver evergreen content which is published across both boohoo's and their own social channels as well as our consumer facing online magazine 'The Fix'.

Our work with celebrities, developing fashion collaborations and staging of events, has supported our growth and helped us reach a large audience. International curve model and blogger Jordyn Woods, worked with us on a collaboration in the summer and the launch party for her range in Los Angeles attracted many "A list" celebrities and influencers.  Pop-up stores were set up in both Paris and Los Angeles to promote the boohoo brand amongst students. Our US efforts have been supported by #boohooontheroad, a cross-country road tour showcasing the boohoo brand to students on spring break. This took place in six cities and finished at the world famous music festival, Coachella. The brand offering has expanded with the introduction of boohooKIDS and maternity. We sponsored Graduate Fashion Week in the UK and staged a number of media events, which further increased awareness of the brand.

The boohooMAN.com website was launched in March 2016, with celebrities fronting promotional activity. This has contributed to an acceleration in menswear sales, supported by a continuously increasing product range and marketing activity focused on the young male audience. We have also undertaken a series of shoots with key influencers, who have global followings.

Through the use of advanced analytical tools and techniques, we have been able to target marketing activities more effectively. Customer surveys have also assisted in identifying efficient campaigns. Reaching new customers through social media is an integral part of our strategy that we have given special attention to in the last six months, which has seen our average weekly post reach on Facebook rise from seventy thousand to between fifteen and twenty million on average.  With increased exposure globally on Facebook Live, Snapchat, Instagram and Instagram stories, this has contributed to both brand awareness and revenue growth.

 

Customer interaction

The number of active customers, who shopped with boohoo in the last 12 months, increased by 29% to 5.2 million and the number of website sessions grew by 21% to 249 million.  Order frequency has risen by 3%, with customers placing an order with us, on average, 2.1 times in 12 months. Conversion rate to sale improved from 4.0% to 4.4% of sessions. On social media we have 4.4 million followers on Instagram, 3.1 million Facebook likes, 0.5 million followers on Twitter and 0.7 million views recorded on YouTube.

We have invested heavily in training and development of our customer services function to support the rapid growth of the business, with coaches providing constant support to advisers. We have also created first and second line teams, which allows more complex and time-consuming customer issues to be resolved by specialists. Live chat has been introduced on the website in response to requests via customer surveys and has been very well received. Increasingly customers prefer to use social media to contact us because of its convenience and we are proud that we typically respond to queries within one hour.

boohoo customers are able to choose from a range of delivery options, which we are constantly refining as new opportunities become available. We operate a midnight cut-off for next day delivery, Sunday delivery and collect+ returns in the UK. In the second half of the year we introduced boohoo Premier, which offers an unlimited next day delivery service in the UK for an annual fee, and has received a very favourable customer response.

Technology

Apps continue to grow in popularity for shopping on mobile devices, with mobile devices accounting for 70% of sessions (up from 66% last year). We will be launching more country-specific apps during 2017, following on from those already in use in our key UK, USA and Australian markets, which have achieved 2.2 million downloads to date. The existing app platform will also be upgraded, in line with our strategy of continually improving app functionality and customer experience.

In the second half of the year, the US and certain European websites were transferred to a new platform, delivering faster performance for the consumer as well as more systems flexibility. All other markets will be gradually transitioned to this platform in 2017, with the benefit of efficiency and cost savings upon completion.

New channels and changing trends are facilitated by our systems architecture, built around the concept of multiple customer channels supported with common infrastructure. Around this architecture, we will continue to make significant investments in the latest sophisticated and most stable platforms in 2017.

 

Warehouse

The warehouse was expanded by three more mezzanine floor layers, increasing capacity by another 275,000 square feet to 525,000 square feet total capacity, sufficient for medium term future growth. A second warehouse extension, which will incorporate a significant amount of automation, has received planning permission and building will commence in mid-2017.

We are investing in a substantial refurbishment and expansion of welfare facilities at the warehouse, which will include an enlarged new canteen, rest area and gym to be completed by summer 2017.

People

We made one additional senior management appointment during the year, that of supply chain director, following a number of senior appointments last year. We appointed a number of skilled middle-management positions and undertook several large-scale training and development programmes as part of our up-skilling and retention policy for staff development.

The rate of growth in revenue has required an increase in personnel in the volume-related functions in customer service and warehousing. The total permanent workforce now stands at 1,415, up from 1,015 at 29 February 2016.

 

PrettyLittleThing

Performance

PrettyLittleThing has contributed two months' revenue since the acquisition on 3 January 2017, amounting to £11.2 million. Revenue growth for these two months is 210% up on the same period last year and twelve month revenue growth was 264%.

Fashion

Our focus continues to be on further establishing the brand as a trend leader, selecting unique designs for the price-conscious consumer with a rapid reaction to fashion trends. We provide our consumers the hottest fashions delivered from a youthful and informal company culture for the social media generation. We are expanding our product range with additions in our shape ranges, plus size and petite and developing accessory ranges and beauty products.

 

Marketing

We see social media as the key to reaching our target consumers and have a diverse team of creatives who produce innovative video content for Facebook, YouTube and Instagram to engage with our audience. Stunningly-shot campaigns, beauty advice and fashion styling tips provide an abundance of irresistible content for young consumers, cementing our relationship as a fashion friend.

Customer interaction

Great customer service is our priority and we provide customers with the ability to contact us via a variety of social media channels, including WhatsApp. A French language website is planned for 2017, with local language support from customer services. A large range of delivery options are available to customers, including nominated day delivery, collect+ and an annual fee premier service in the UK. We have 0.8 million followers on Facebook, 0.3 million followers on Twitter, 1.5 million Instagram followers, 2.0 million YouTube views as well as a presence on several other social media channels.

Technology

We have android and iOS apps for the UK and will roll out an app for the US market in 2017. There has been significant investment and development in the IT architecture during the year and much planned for 2017, with some systems scheduled to move to cloud providers. The IT department has been substantially strengthened to enable us to meet the requirements of the growing business.

People

A great deal of effort has been put into recruiting a talented team during the year. The total permanent workforce now stands at 147.
 

Financial review

The group has achieved a strong performance with revenues and profits increasing in all territories.

 

Group revenue by brand

 

2017

2016

Change

Change

 

£000

£000

 

CER

boohoo

283,378

195,394

+45%

+44%

PrettyLittleThing

11,257

-

-

-

 

294,635

195,394

+51%

+49%

The sales revenue above for PrettyLittleThing is for the two months to 28 February 2017. For comparative purposes, PrettyLittleThing's revenue for the twelve months to 28 February 2017 was £55.3 million (2016: £17.0 million).

 

Group revenue by geographical market

 

 

2017

2016

Change

Change

 

£000

£000

 

CER

UK

181,981

130,096

+40%

+40%

Rest of Europe

34,735

22,630

+53%

+47%

USA

40,435

16,523

+145%

+124%

Rest of world

37,484

26,145

+43%

+45%

 

294,635

195,394

+51%

+49%

 

KPIs

boohoo

 

 

2017

2016

Change

 

Active customers(1)

5.2 million

4.0 million

+29%

Number of orders

11.1 million

8.3 million

+33%

Order frequency(2)

2.13

2.07

+3%

Conversion rate to sale (3)

4.4%

4.0%

+40bps

Average order value(4)

£37.76

£33.59

+12.4%

Number of items per basket

2.89

2.62

+10.3%

 

1.     Defined as having shopped in the last 12 months

2.     Defined as number of orders in last 12 months divided by number of active customers

3.     Defined as the percentage of orders taken to internet sessions

4.     Calculated as gross sales including sales tax divided by the number of orders

 

Active customer numbers have increased by 29% compared to the previous 12 month period as we continue to grow our customer base and retain existing customers. Conversion rates have increased to 4.4%, supported by our attractive proposition. Average order value has risen by 12.4% to £37.76 driven by the number of items per basket increasing by 10.3% to 2.89 and by the greater proportion of international business, which has a higher average order value than the UK business.

 

PrettyLittleThing

 

 

 

2 months

2017

12 months

2017

12 months 2016

12 months' change

 

Active customers(1)

1.3 million

1.3 million

0.5 million

+138%

Number of orders

0.5 million

2.6 million

0.9 million

+176%

Order frequency(2)

2.0

2.0

1.8

+11%

Conversion rate to sale (3)

3.7%

3.7%

3.1%

+60bps

Average order value(4)

£33.18

£34.36

£30.07

+14.2%

Number of items per basket

2.03

2.10

2.00

+5.0%

 

The data in the table above is calculated over the twelve month period for both years, in order to provide meaningful information, and for the two month period of ownership. Active customer numbers have increased by 138% compared to the previous 12 month period. Conversion rates continue to improve and have increased to 3.7%. Average order value has increased by 14.2% to £34.36 for the 12 month period and the number of items per basket has increased by 5.0% to 2.10.

 

 

 

Consolidated income statement

 

 

2017

2016

Change

 

£000

£000

 

Revenue

294,635

195,394

+51%

Cost of sales

(133,806)

(82,483)

+62%

Gross profit

160,829

112,911

+42%

Gross margin

54.6%

57.8%

-320bps

 

 

 

 

Distribution costs

(66,849)

(45,501)

 

Administrative expenses

(68,534)

(53,756)

 

Other income

4,862

1,392

 

Operating profit

30,308

15,046

+101%

 

 

 

 

Finance income

637

628

 

Profit before tax

30,945

15,674

+97%

 

 

 

 

Adjusted EBITDA

35,563

18,711

+90%

 

 

 

 

Calculation of adjusted EBITDA

 

 

 

Operating profit

30,308

15,046

 

Depreciation and amortisation

4,765

3,058

 

Equity-settled share-based payment charge

1,895

607

 

Gain on option to acquire PrettyLittleThing.com Limited

(1,405)

-

 

Adjusted EBITDA

35,563

18,711

 

Gross margin reduced from 57.8% to 54.6%, primarily due to an increase in promotional activity, which has in turn increased sales growth.

Distribution costs have increased with revenue growth and remained broadly in line as a percentage of revenue. Administrative expenses, which include marketing expenses, have risen due to the combination of revenue growth and the building of our infrastructure to support the future business expansion but also decreased as a percentage of revenue.

The gain on the exercise of the option to acquire PrettyLittleThing.com Limited of £1.4 million arose because the consideration paid was less than the value of the assets acquired. A full analysis of the acquisition accounting is contained within note 12 of this financial information.

EBITDA (adjusted) increased by 90% from £18.7 million to £35.6 million and, as a percentage of revenue, increased from 9.6% to 12.1%, due to significant revenue growth allowing the cost base to be leveraged.

 

Taxation

 

The effective rate of tax for the year was 20.0% (2016: 20.6%), which is in line with the blended UK statutory rate of tax for the year of 20.0% (2016: 20.1%).

 

Earnings per share

 

Basic earnings per share increased by 97% from 1.11p to 2.19p.

 

Consolidated statement of financial position

 

 

2017

2016

 

 

£000

£000

Intangible assets

 

35,446

4,542

Property, plant and equipment

 

32,019

21,426

Financial assets

 

231

28

Deferred tax asset

 

4,494

231

Non-current assets

 

72,190

26,227

 

 

 

 

Working capital

 

(11,939)

(4,248)

Net financial assets

 

(11,817)

(4,866)

Cash and cash equivalents

 

70,330

58,281

Interest bearing loans and borrowings

 

(11,910)

-

Deferred tax liability

 

(2,597)

-

Current tax liability

 

(3,761)

(1,967)

Net assets

 

100,496

73,427

 

Intangible assets have increased by £31.0 million due to the acquisition of PrettyLittleThing.com Limited (£14.9 million) and the intellectual property of Nasty Gal (£16.1 million). Property, plant and equipment has risen by £10.6 million due to warehouse and office investment.

 

Working capital has reduced primarily due to an increase in payables and accruals relating to our increased trading activity. The deferred tax liability relates to the acquisition of PrettyLittleThing.com Limited. Net assets have increased by £27.1 million (+37%).

 

Liquidity and financial resources

Free cash flow was £5.4 million compared to £6.5 million in the previous financial year. Capital expenditure was £30.7 million, which includes £16.1 million for the Nasty Gal intellectual property and £14.6 million investment in our warehouse and IT systems to support projected growth in trade. The acquisition of the Nasty Gal assets was funded by a five year loan of £11.9 million. The consideration paid for PrettyLittleThing.com Limited was £5.9m and the cash acquired was £6.6m. The closing cash balance for the group was £70.3 million.

 

Consolidated cash flow statement

 

 

 

 

 

 

2017

2016

 

 

£000

£000

 

 

 

 

Profit for the year

 

24,661

12,438

 

 

 

 

Depreciation charges and amortisation

 

4,765

3,058

Share-based payments charge

 

1,895

607

Tax expense

 

6,284

3,236

Finance income

 

(637)

(628)

Increase in inventories

 

(11,925)

(7,481)

Increase in trade and other receivables

 

(4,107)

(3,243)

Increase in trade and other payables

 

15,166

12,098

Capital expenditure and intangible asset purchases

 

(30,675)

(13,611)

Free cash flow

 

5,427

6,474

 

 

 

 

Acquisition of 66% interest in PrettyLittleThing.com Limited (excess of cash acquired over consideration)

655

-

Gain on option to acquire PrettyLittleThing.com Limited

 

(1,405)

-

Purchase of own shares by Employee Benefit Trust

 

-

(331)

Proceeds from the issue of ordinary shares

 

54

-

Finance income received

 

614

619

Tax paid

 

(5,206)

(2,627)

Proceeds from new loan

 

11,910

-

Net cash flow

 

12,049

4,135

 

 

 

 

Cash and cash equivalents at beginning of year

 

58,281

54,146

Cash and cash equivalents at end of year

 

70,330

58,281

 

 

 

 

             

 

Trends and factors likely to affect future performance

The market for online fashion is forecast to continue to grow and, along with the increasing use of the internet globally, provides a favourable backdrop for the group with much opportunity for further growth. Customers throughout the world are seeking a wide choice of quality products at value prices lower than those available on the high street with the convenience of home delivery. The group's target market of 16 to 30 year olds has a high propensity to spend on fashion and the market is resilient to external macroeconomic factors.

 

Outlook

The outlook for online fashion retail is very positive, with young consumers globally preferring the choice, price and convenience of online shopping. For us this creates a great opportunity to continue to expand our business operations across the globe. With the addition this year of two highly successful and attractive brands, we are building a robust business capable of meeting the demand and challenges in our sector.

We will continue to focus on delivering our winning strategy, refining and adapting our proposition as market conditions change and as new opportunities arise. Our focus will be to continue to develop key markets with the greatest growth potential, to invest in technology and deliver the most exciting products at great prices to consumers with excellent customer service.

Trading in the first few weeks of the 2018 financial year has made a promising start and we are excited about the prospects of our development into a multi-branded business. We expect group revenue growth approaching 50%(1) over 2017, which includes growth from the recent acquisitions,  and a group EBITDA margin of approximately 10%."

 

(1)   Revenue growth from the boohoo brand is expected to be approximately 25% year on year. Revenue growth from the PrettyLittleThing brand is expected to be approximately 35% above the 12 month revenue to 28 February 2017 of £55 million. The balance of the growth to approaching 50% will come from the Nasty Gal brand.


 

Consolidated statement of comprehensive income

for the year ended 28 February 2017

 

Note

 

2017

2016

 

 

 

£000

£000

Revenue

2

 

294,635

195,394

Cost of sales

 

 

(133,806)

(82,483)

Gross profit

 

 

160,829

112,911

 

 

 

 

 

Distribution costs

 

 

(66,849)

(45,501)

Administrative expenses

 

 

(68,534)

(53,756)

Other income

3

 

4,862

1,392

Operating profit

 

 

30,308

15,046

 

 

 

 

 

Finance income

4

 

637

628

Profit before tax

5

 

30,945

15,674

 

 

 

 

 

Taxation

9

 

(6,284)

(3,236)

 

 

 

 

 

Profit for the year

 

 

24,661

12,438

 

 

 

 

 

Profit for the year attributable to:

 

 

 

 

Shareholders of the holding company

 

 

24,458

12,438

Non-controlling interest

 

 

203

-

 

 

 

24,661

12,438

 

 

 

 

 

Total other comprehensive (expense)/income for the year, net of income tax

Net fair value loss on cash flow hedges 1

 

 

(6,747)

(5,661)

Total comprehensive income for the year

 

 

17,914

6,777

 

 

 

 

 

Total comprehensive income attributable to:

 

 

 

 

Shareholders of the holding company

 

 

17,711

6,777

Non-controlling interest

 

 

203

-

 

 

 

17,914

6,777

 

 

 

 

 

Earnings per share

6

 

 

 

Basic

 

 

2.19p

1.11p

Diluted

 

 

2.16p

1.10p

 

1.        Net fair value gains on cash flow hedges will be reclassified to profit or loss during the two years to 28 February 2019.

 

Consolidated statement of financial position

at 28 February 2017

 

Note

 

2017

2016

                                                                     

 

 

£000

£000

Assets

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets

10

 

35,446

4,542

Property, plant and equipment

11

 

32,019

21,426

Financial assets

19

 

231

28

Deferred tax

13

 

4,494

231

 

 

 

72,190

26,227

Current assets

 

 

 

 

Inventories

14

 

34,170

18,669

Trade and other receivables

15

 

11,944

7,096

Financial assets

19

 

489

35

Cash and cash equivalents

 

 

70,330

58,281

Total current assets

 

 

116,933

84,081

 

 

 

 

 

Total assets

 

 

189,123

110,308

 

 

 

 

 

Liabilities

 

 

 

 

Current liabilities

 

 

 

 

Trade and other payables

16

 

(58,053)

(30,013)

Interest bearing loans and borrowings

17

 

(2,382)

-

Financial liabilities

19

 

(10,229)

(4,291)

Current tax liability

 

 

(3,761)

(1,967)

Total current liabilities

 

 

(74,425)

(36,271)

 

 

 

 

 

Non-current liabilities

 

 

 

 

Interest bearing loans and borrowings

17

 

(9,528)

-

Financial liabilities

19

 

(2,077)

(610)

Deferred tax

13

 

(2,597)

-

 

 

 

 

 

Total liabilities

 

 

(88,627)

(36,881)

 

 

 

 

 

Net assets

 

 

100,496

73,427

 

 

 

 

 

Equity

 

 

 

 

Share capital

18

 

11,233

11,233

Share premium

 

 

551,720

551,666

Capital redemption reserve

 

 

100

100

Hedging reserve

 

 

(11,586)

(4,839)

EBT reserve

 

 

(761)

(761)

Translation reserve

 

 

5

1

Reconstruction reserve

 

 

(515,282)

(515,282)

Non-controlling interest

 

 

3,978

-

Retained earnings

 

 

61,089

31,309

Total equity      

 

 

100,496

73,427

 


 

Consolidated statement of changes in equity

 

Share capital

Share premium

Capital redemption reserve

Hedging reserve

EBT reserve

Transla-tion reserve

Recon-struction reserve

Non-controlling interest

Retained earnings

Total

equity

 

£000

£000

£000

£000

£000

£000

£000

£000

£000

£000

Balance as at 1 March 2015

11,231

551,612

100

822

(430)

-

(515,282)

-

18,320

66,373

Purchase of shares by EBT

-

-

-

-

(331)

-

-

-

-

(331)

Share-based payments credit

2

54

-

-

-

-

-

-

551

607

Profit for the year

-

-

-

-

-

-

-

-

12,438

12,438

Translation of foreign operations

-

-

-

-

-

1

-

-

-

1

Other comprehensive expense

-

-

-

(5,661)

-

-

-

-

-

(5,661)

Balance at 29 February 2016

11,233

551,666

100

(4,839)

(761)

1

(515,282)

-

31,309

73,427

 

 

 

 

 

 

 

 

 

 

 

Acquisition of 66% interest in PrettyLittleThing.com Limited

-

-

-

-

-

-

-

3,775

-

3,775

Issue of shares

-

54

-

-

-

-

-

-

-

54

Share-based payments credit

-

-

-

-

-

-

-

-

1,895

1,895

Excess deferred tax on share-based payments

-

-

-

-

-

-

-

-

3,427

3,427

Profit for the year

-

-

-

-

-

-

-

203

24,458

24,661

Translation of foreign operations

-

-

-

-

-

4

-

-

-

4

Other comprehensive expense

-

-

-

(6,747)

-

-

-

-

-

(6,747)

Balance at 28 February 2017

11,233

551,720

100

 (11,586)

(761)

5

(515,282)

3,978

61,089

 100,496

                       

 

  

Consolidated cash flow statement

for the year ended 28 February 2017

 

Note

 

2017

2016

 

 

 

£000

£000

Cash flows from operating activities

 

 

 

 

 

 

24,661

12,438

 

 

 

 

 

 

1,895

607

 

 

4,765

3,058

 

 

-

(2)

 

 

(1,405)

-

 

 

(637)

(628)

Tax expense

 

 

6,284

3,236

 

 

35,563

18,709

 

 

 

 

14

 

(11,925)

(7,481)

15

 

(4,107)

(3,243)

16

 

15,166

12,098

Cash generated from operations

 

 

34,697

20,083

 

 

 

 

 

 

(5,206)

(2,627)

Net cash generated from operating activities

 

 

29,491

17,456

 

 

 

 

 

 

 

 

Acquisition of intangible assets

10

 

(18,311)

(1,488)

11

 

(12,364)

(12,123)

 

 

-

2

Acquisition of 66% interest in PrettyLittleThing.com Limited (excess of cash acquired over consideration)

 

655

-

 

 

614

619

Net cash used in investing activities

 

 

(29,406)

(12,990)

 

 

 

 

 

 

 

 

 

 

-

(331)

 

 

54

-

 

 

11,910

-

Net cash generated from/(used in) financing activities

 

 

11,964

(331)

 

 

 

 

 

Increase in cash and cash equivalents

 

 

12,049

4,135

 

 

 

 

 

Cash and cash equivalents at beginning of year

 

 

58,281

54,146

Cash and cash equivalents at end of year

 

 

70,330

58,281

 


 

Notes to the financial statements

(forming part of the financial statements)

1              Accounting policies

General information

boohoo.com plc is a public limited company incorporated and domiciled in Jersey and listed on the Alternative Investment Market (AIM) of the London Stock Exchange. Its registered office address is: 12 Castle Street, St Helier, Jersey, JE2 3RT. The company was incorporated on 19 November 2013.

Basis of preparation

This condensed consolidated financial information for the year ended 28 February 2017 has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards as adopted by the European Union ("Adopted IFRSs"), IFRS IC Interpretations and the Companies (Jersey) Law 1991.

 

The financial information contained in this preliminary announcement for the years ended 28 February 2017 and 29 February 2016 does not comprise the group's statutory financial statements within the meaning of Companies (Jersey) Law 1991. Statutory accounts for the year ended 28 February 2017 will be filed with the Jersey Companies Registry in due course. The auditors' report on the statutory accounts for each of the years ended 28 February 2017 and 29 February 2016 is unqualified, does not draw attention to any matters by way of emphasis and does not contain any statement under any matters that are required to be reported by exception under Companies (Jersey) Law 1991.

 

Going concern

The directors have reviewed the group's forecast and projections, including assumptions concerning capital expenditure and expenditure commitments and their impact on cash flows, and have a reasonable expectation that the group has adequate financial resources to continue its operations for the foreseeable future. For this reason they have continued to adopt the going concern basis in preparing the financial statements.

In preparing the preliminary announcement, the directors have also made reasonable and prudent judgements and estimates and prepared the preliminary announcement on the going concern basis. The preliminary announcement and management report contained herein give a true and fair view of the assets, liabilities, financial position and profit and loss of the group.

Changes to accounting standards

There have been no changes to accounting standards during the year which have had or are expected to have any significant impact on the group.

 

 

2              Segmental analysis

IFRS 8, "Operating Segments", requires operating segments to be determined based on the group's internal reporting to the chief operating decision maker. The chief operating decision maker has been determined to be the executive board and has determined that the primary segmental reporting format of the group for 2017 is by brand. This is based on the group's management and internal reporting structure, boohoo and PrettyLittleThing ["PLT"]. In 2016 the boohoo business was the only segment and that segment was analysed into geographical regions.

The executive board assesses the performance of each segment based on revenue and gross profit after distribution expenses, which excludes administrative expenses.

 

 

Year ended 28 February 2017

 

 

 

boohoo

PLT

Total

 

 

 

£000

£000

£000

Revenue

 

 

283,378

11,257

294,635

 

 

 

 

 

 

Cost of sales

 

 

(129,026)

(4,780)

(133,806)

Gross profit

 

 

154,352

6,477

160,829

 

 

 

 

 

 

Distribution costs

 

 

(64,375)

(2,474)

(66,849)

Segment result

 

 

89,977

4,003

93,980

 

 

 

 

 

 

Administrative expenses

 

 

-

-

(68,534)

Other income

 

 

-

-

4,862

Operating profit

 

 

-

-

30,308

 

 

 

 

 

 

Finance income

 

 

-

-

637

Profit before tax

 

 

-

-

30,945

 

 

 

Year ended 29 February 2016

 

 

 

 

 

 

boohoo

 

 

 

 

 

 

£000

 

Revenue

 

 

 

 

195,394

 

 

 

 

 

 

 

 

Cost of sales

 

 

 

 

(82,483)

 

Gross profit

 

 

 

 

112,911

 

 

 

 

 

 

 

 

Distribution costs

 

 

 

 

(45,501)

 

Segment result

 

 

 

 

67,410

 

 

 

 

 

 

 

 

Administrative expenses

 

 

 

 

(53,756)

 

Other income

 

 

 

 

1,392

 

Operating profit

 

 

 

 

15,046

 

 

 

 

 

 

 

 

Finance income

 

 

 

 

628

 

Profit before tax

 

 

 

 

15,674

 

 

 

 

Revenue by geographic region

 

 

2017

2016

 

 

£000

£000

UK

 

181,981

130,096

Rest of Europe

 

34,735

22,630

USA

 

40,435

16,523

Rest of world

 

37,484

26,145

 

 

294,635

195,394

 

3             Other income

 

 

2017

2016

 

 

£000

£000

Income from warehouse management services

 

3,457

1,033

Gift to group from director for benefit of employees

 

-

359

Gain on option to acquire PrettyLittleThing.com Limited

 

1,405

-

 

 

4,862

1,392

 

 

 

4             Finance income

 

 

2017

2016

 

 

£000

£000

Bank interest received

 

637

628

 

 

 

5              Profit before tax

Profit before tax is stated after charging:

2017

2016

 

£000

£000

Operating lease rentals for buildings

1,060

712

Depreciation of property, plant and equipment

2,488

1,551

Amortisation of intangible assets

2,277

1,507

 

 

6              Earnings per share

Basic earnings per share is calculated by dividing profit after tax attributable to members of the holding company by the weighted average number of shares in issue during the year. Own shares held by the Employee Benefit Trust are eliminated from the weighted average number of shares. Diluted earnings per share is calculated by dividing the profit after tax attributable to members of the holding company by the weighted average number of shares in issue during the year, adjusted for potentially dilutive share options.

 

 

 

2017

2016

Weighted average shares in issue for basic earnings per share

 

1,118,177,098

1,118,429,548

Dilutive share options

 

16,269,059

11,761,758

Weighted average shares in issue for diluted earnings per share

 

1,134,446,158

1,130,191,306

 

 

 

 

Earnings (£000)

 

24,458

12,438

Basic earnings per share

 

2.19p

1.11p

Diluted earnings per share

 

2.16p

1.10p

 

 

7              Staff numbers and costs

The average monthly number of persons employed by the group (including directors) during the year, analysed by category, was as follows:

 

Number of employees

 

2017

2016

Administration

689

489

Distribution

612

419

 

1,301

908

 

The aggregate payroll costs of these persons were as follows:

 

2017

2016

 

£000

£000

Wages and salaries

31,567

23,461

Social security costs

2,897

2,224

Pension costs

410

325

Equity-settled share-based payment charges

1,895

607

Cash-settled share-based payment charges

1,654

-

 

38,423

26,617

 

 

 

8              Directors' and key management compensation

 

2017

2016

 

£000

£000

Short-term employee benefits

3,886

2,925

Post-employment benefits

86

65

Equity-settled share-based payment charges

17

111

Cash-settled share-based payment charges

1,120

-

 

5,109

3,101

Directors' and key management compensation comprises the directors and executive committee members.

 

 

9              Taxation

 

2017

2016

 

£000

£000

Analysis of charge in year

 

 

 

 

 

Current tax on income for the year

7,126

3,423

Adjustments in respect of prior year taxes

(6)

(2)

Deferred taxation

(836)

(185)

Tax on profit on ordinary activities

6,284

3,236

 

      

      

The total tax charge differs from the amount computed by applying the blended UK rate of 20.0% for the year (2016: 20.1%) to profit before tax as a result of the following:

 

 

 

Profit on ordinary activities before tax

30,945

15,674

Profit before tax multiplied by the standard blended rate of corporation tax of the UK of 20.0% (2016: 20.1%)

6,189

3,148

Effects of:

 

 

Expenses not deductible for tax purposes

246

14

Income not subject to tax

(320)

-

Adjustments in respect of prior year taxes

(6)

(2)

Overseas tax differentials

5

4

Depreciation in excess of capital allowances

170

72

Tax on profit on ordinary activities

6,284

3,236

 

 

A change to reduce the main rate of corporation tax to 17% from 1 April 2020 was announced in the Chancellor's budget on 16 March 2016. Changes to reduce the UK corporation tax rate to 19% from 1 April 2017 and to 17% from 1 April 2020 had already been substantively enacted on 15 September 2016.

 
 

10           Intangible assets

 

Patents and licences

Trademarks

Customer lists

Computer software

Total

 

£000

£000

£000

£000

£000

Cost

 

 

 

 

 

Balance at 1 March 2015

309

-

-

5,795

6,104

Additions

-

-

-

1,488

1,488

Disposals

-

-

-

(208)

(208)

Balance at 29 February 2016

309

-

-

7,075

7,384

 

 

 

 

 

 

On acquisition

-

10,000

4,800

152

14,952

Additions

1

15,070

1,026

2,213

18,310

Disposals

-

-

-

(232)

(232)

Balance at 28 February 2017

310

25,070

5,826

9,208

40,414

 

 

 

 

 

 

Accumulated amortisation

 

 

 

 

 

Balance at 1 March 2015

118

-

-

1,425

1,543

Amortisation for year

31

-

-

1,476

1,507

Disposals

-

-

-

(208)

(208)

Balance at 29 February 2016

149

-

-

2,693

2,842

 

 

 

 

 

 

On acquisition

-

-

-

81

81

Amortisation for year

31

167

267

1,812

2,277

Disposals

-

-

-

(232)

(232)

Balance at 28 February 2017

180

167

267

4,354

4,968

 

 

 

 

 

 

Net book value

 

 

 

 

 

At 28 February 2015

191

-

-

4,370

4,561

At 29 February 2016

160

-

-

4,382

4,542

At 28 February 2017

130

24,903

5,559

4,854

35,446

 

The costs and accumulated depreciation of trademarks and customer lists on acquisition represent those of PrettyLittleThing.com Limited (note 12) and the costs of trademarks and customer lists additions represent those of Nasty Gal.
 

11           Property, plant and equipment

 

Short leasehold

Fixtures and fittings

Computer equipment

Motor vehicles

Land & buildings

Total

 

£000

£000

£000

£000

£000

£000

Cost

 

 

 

 

 

 

Balance at 1 March 2015

643

3,323

1,311

91

7,677

13,045

Additions

123

6,201

285

22

5,492

12,123

Disposals

-

(26)

(31)

-

-

(57)

Balance at 29 February 2016

766

9,498

1,565

113

13,169

25,111

 

 

 

 

 

 

 

On acquisition

409

157

401

27

-

994

Additions

172

6,631

689

145

4,727

12,364

Disposals

(226)

(681)

(171)

-

-

(1,078)

Balance at 28 February 2017

1,121

15,605

2,484

285

17,896

37,391

 

 

 

 

 

 

 

Accumulated depreciation

 

 

 

 

 

 

Balance at 1 March 2015

363

1,022

571

30

205

2,191

Depreciation charge for the year

116

819

454

21

141

1,551

Disposals

-

(26)

(31)

-

-

(57)

Balance at 29 February 2016

479

1,815

994

51

346

3,685

 

 

 

 

 

 

 

On acquisition

66

30

176

5

-

277

Depreciation charge for the year

118

1,538

512

66

254

2,488

Disposals

(226)

(681)

(171)

-

-

(1,078)

Balance at 28 February 2017

437

2,702

1,511

122

600

5,372

 

 

 

 

 

 

 

Net book value

 

 

 

 

 

 

At 28 February 2015

280

2,301

740

61

7,472

10,854

At 29 February 2016

287

7,683

571

62

12,823

21,426

At 28 February 2017

684

12,903

973

163

17,296

32,019

 

The costs and accumulated depreciation on acquisition represent those of PrettyLittleThing.com Limited (note 12).

 

12           Investments

The subsidiaries held and consolidated in these financial statements are set out below:

Name of company

Principal activity

Country of incorporation

Address

Percentage ownership

PrettyLittleThing.com Limited

Internet fashion retail

UK

Wellington Mill, Pollard Street East, Manchester

66%

21Three Trading Company Limited

Dormant company

UK

Wellington Mill, Pollard Street East, Manchester

66%

ABK Limited

Holding company

Jersey

12 Castle St, St Helier, Jersey

100%

boohoo.com UK Limited

Trading company

UK

49-51 Dale St, Manchester

100%

Nasty Gal Limited

Trading company

UK

49-51 Dale St, Manchester

100%

Boo Who Limited

Dormant company

UK

49-51 Dale St, Manchester

100%

boohoo.com USA Limited

Dormant company

UK

49-51 Dale St, Manchester

100%

boohoo.com USA Inc

Marketing office

USA

3 West 13th Street, New York

100%

boohoo.com Australia Pty Ltd

Marketing office

Australia

468 St Kilda Road, Melbourne

100%

Shanghai Wasabi Frog Boohoo Ltd

Dormant company

China

49-51 Dale St, Manchester

100%

 

The company acquired a 66% interest in PrettyLittleThing.com Limited ["PLT"] (formerly 21Three Clothing Company Limited) on 3 January 2017. The consideration was £5.9 million, being £3.3 million plus 'cash less debt' of £2.6 million, payable in cash.

                                                                               

PLT is an on-line retailer of women's clothing, shoes and accessories. The directors considered that the acquisition of a complementary brand with differentiated product diversifies risk and adds market share in the rapidly expanding global on-line clothing market.                                                                             

                                                                               


 

The fair value assets and liabilities on the acquisition date were as follows:                                                                     

 

 

 

 

 

£000

Fixed assets

 

 

Intangible assets - trademark

 

10,000

Intangible assets - customer lists

 

4,800

Tangible fixed assets

 

787

Deferred tax asset

 

206

 

 

15,793

Current assets

 

 

Stock

 

3,576

Trade and other receivables

 

718

Cash

 

6,579

 

 

10,873

Current liabilities

 

 

Trade creditors and accruals

 

(12,878)

 

 

 

Deferred tax liability on intangible assets

 

(2,684)

 

 

 

Net assets

 

11,104

Non-controlling interest

 

(3,775)

Share of fair value net assets acquired

 

7,329

                                               

                                                                               

 

The fair value of the trademark was calculated using the relief from royalty method, with assumptions as follows: royalty rate 3.0%; and discount rate 30%.The fair value of the customer lists was calculated using the cost that PLT has incurred to acquire the customers during the period prior to acquisition. Trade and other receivables represents amounts owing from wholesale customers and prepaid expenses. The non-controlling interest of £3.8 million was valued as 34% of the fair value of the net assets.

                                                                                                                               

The option gain in the income statement, included in other income, is as follows:                                                         

 

 

£000

 

 

 

Consideration

 

5,924

Fair value of net assets

 

(11,104)

Non-controlling interest

 

3,775

Option gain

 

1,405

 

 

 

               

               

Explanation of the gain on acquisition: boohoo.com plc entered into a call option agreement with the shareholders of PLT in which the company obtained an option to purchase 100% of PLT for £5 million before March 2017. The consideration set at the time of the agreement is considerably lower than the fair value of the net assets at the acquisition date because of the high growth and success of the company. In order to ensure the continued success of PLT under group ownership, the original option agreement has been replaced by a new agreement, whereby the remaining senior management of PLT have been incentivised by retaining 34% of the share capital of PLT, which the directors of boohoo.com plc consider is in the best interests of the group. The consideration ultimately payable for the remaining 34% is dependent on a number of factors including the financial performance of PLT but is limited to a maximum of the market value at the future option date.

                                                                               

Acquisition costs included in administration expenses amounted to £0.3 million.                                                                          

                                                                               

The statements of comprehensive income of PrettyLittleThing.com Limited ["PLT"] for the 2 months from acquisition and the group for 12 months, as if PLT had been acquired since the beginning of the financial year, are as follows:                

               

 

 

 

 

 

PLT: 2 months from 3 January

 2017

 

Group: 12 months from 1 March

2016

 

 

 

£000

 

£000

Revenue

 

 

11,257

 

338,704

 

 

 

 

 

 

Cost of sales

 

 

(4,780)

 

(152,931)

Gross profit

 

 

6,477

 

185,773

 

 

 

 

 

 

Distribution costs

 

 

(2,474)

 

(76,042)

Administrative expenses

 

 

(3,200)

 

(82,298)

Other income

 

 

-

 

4,862

Operating profit

 

 

803

 

32,295

 

 

 

 

 

 

Finance income

 

 

-

 

637

Profit before tax

 

 

803

 

32,932

Taxation

 

 

(205)

 

(6,079)

Profit after tax

 

 

598

 

26,853

 

 

13           Deferred tax

 

Assets

 

Depreciation in excess of capital allowances

Share-based payments

Total

 

£000

£000

£000

Asset at 1 March 2015

(12)

58

46

Recognised in statement of comprehensive income

74

111

185

Asset at 29 February 2016

62

169

231

Recognised in statement of comprehensive income

170

666

836

Credit in equity

-

3,427

3,427

Asset at 28 February 2017

232

4,262

4,494

 

Liabilities

 

 

 

Business combinations

Total

 

 

£000

£000

Recognised in statement of comprehensive income

 

(2,597)

(2,597)

Liability at 28 February 2017

 

(2,597)

(2,597)

 

Recognition of the deferred tax assets is based upon the expected generation of future taxable profits. The deferred tax asset is expected to be recovered in more than one year's time and the deferred tax liability will reverse in more than one year's time as the intangible assets are amortised.

 

 

14           Inventories

 

2017

2016

 

£000

£000

Finished goods

34,170

18,669

 

The value of inventories included within cost of sales for the year was £133,515,000 (2016: £82,187,000). An impairment provision of £291,000 (2016: £296,000) was charged to the statement of comprehensive income.

 

 

15           Trade and other receivables

 

2017

2016

 

£000

£000

Amounts due from related party undertakings

-

613

Trade and other receivables

9,446

4,937

Prepayments and accrued income

2,498

1,546

 

11,944

7,096

 

Trade and other receivables represent amounts due from wholesale customers and advance payments to suppliers. Receivables past due are £698,000 (2016: £142,000). The provision for impairment of receivables is £573,000 (2016: £318,000).

 

16           Trade and other payables

 

 

2017

2016

 

£000

£000

Trade payables

23,124

11,255

Amounts owed to related party undertakings

2

17

Other payables

3,090

175

Accruals and deferred income

27,465

15,272

Taxes and social security payable

4,372

3,294

 

58,053

30,013

 

 

17           Interest-bearing loans and borrowings

This note provides information about the contractual terms of the group's interest-bearing loans and borrowings, which are measured at amortised cost.

 

2017

2016

 

£000

£000

Non-current liabilities

 

 

Secured bank loans

9,528

-

 

 

 

Current liabilities

 

 

Current portion of secured bank loans

2,382

-

 

Terms and debt repayment schedule

 

 

 

 

Nominal

 

 

 

 

 

 

 

interest

Year of

2017

2016

 

 

 

Currency

rate

maturity

£000

£000

Secured bank loan

 

 

GB£

LIBOR + 0.95%

2022

11,910

-

 

18           Share capital and reserves

 

2017

2016

 

£000

£000

1,123,304,869 authorised and fully paid ordinary shares of 1p each

(2016: 1,123,267,330)

11,233

11,233

 

On 24 February 2017, 37,539 new ordinary shares were issued to non-executive directors as part of their annual remuneration.

Under merger accounting principles, a reconstruction reserve of £515,282,000 was created upon the acquisition of the group and flotation on 14 March 2014.

No dividends have been paid or are payable for the year ended 28 February 2017 (2016: £nil).

 

19           Financial instruments

 

 

2017

2016

 

£000

£000

Financial assets

 

 

Cash and cash equivalents

70,330

58,281

Cash flow hedges

720

63

Trade and other receivables

9,446

5,550

 

80,496

63,894

 

 

2017

2016

 

£000

£000

Financial liabilities

 

 

Cash flow hedges

12,306

4,901

Trade and other payables

53,681

26,719

Interest bearing loans and borrowings

11,910

-

 

77,897

31,620

 

 

20           Capital commitments

Capital expenditure contracted for at the end of the reporting year but not yet incurred is as follows:

 

2017

2016

 

£000

£000

Property, plant and equipment

2,100

-

 

 

21           Operating Leases            

The group has lease agreements in respect of properties, plant and equipment, for which the payments extend over a number of years. The totals of future minimum lease payments under non-cancellable operating leases due in each period are:        

 

2017

2016

 

£000

£000

Within one year

1,229

734

Within two to five years

2,785

2,363

In more than five years

916

1,445

 

4,930

4,542

 

 

22           Contingent liabilities

From time to time, the group can be subject to various legal proceedings and claims that arise in the ordinary course of business which may include cases relating to the group's brand and trading name. All such cases brought against the group are robustly defended and a liability is recorded only when it is probable that the case will result in a future economic outflow and that the outflow can be reliably measured.

As at 28 February 2017, there are no pending claims or proceedings against the group which are expected to have material adverse effect on its liquidity or operations.


 

Appendix - prior period revenues by region

 

Revenue by period for the twelve months ended 28 February 2017

 

£'000

3m to 31 May

3m to 31 August

6m to 31 August

 

FY17

FY16

yoy %

yoy % CER

FY17

FY16

yoy %

yoy %

CER

FY17

FY16

yoy %

 

yoy %

CER

 

Total

58,222

41,322

41%

42%

69,094

49,462

40%

40%

127,316

90,784

40%

41%

 

 

 

 

 

 

 

 

 

 

 

Sales by region

 

 

 

 

 

 

 

 

 

 UK

37,396

26,273

42%

42%

44,300

32,855

35%

35%

81,696

59,128

38%

38%

 

 ROE

6,938

4,943

40%

43%

7,775

5,460

42%

40%

14,713

10,403

41%

41%

 

 USA

6,385

3,815

67%

60%

8,841

4,086

116%

100%

15,226

7,901

93%

81%

 

 ROW

7,503

6,291

19%

27%

8,178

7,061

16%

27%

15,681

13,352

17%

27%

 

 

£'000

4m to 31 December

2m to 28 February

12m to 28 February

 

FY17

FY16

yoy %

yoy % CER

FY17

FY16

yoy %

yoy %

CER

FY17

FY16

yoy %

 

yoy %

CER

Total

114,294

73,692

55%

52%

53,025

30,918

72%

67%

294,635

195,394

51%

49%

 

 

 

 

 

 

 

 

 

Sales by region

 

 

 

 

 

 

 

 

 UK

65,465

49,701

32%

32%

34,820

21,267

64%

64%

181,981

130,096

40%

40%

 ROE

13,963

8,588

63%

54%

6,059

3,639

67%

47%

34,735

22,630

53%

47%

 USA

19,299

5,962

224%

183%

5,910

2,660

122%

105%

40,435

16,523

145%

124%

 ROW

15,567

9,441

65%

56%

6,236

3,352

86%

74%

37,484

26,145

43%

45%

 

 

Revenue by period for the year to 29 February 2016

 

£'000

3m to 31 May

3m to 31 August

6m to 31 August

 

FY16

FY15

yoy %

yoy % CER

FY16

FY15

yoy %

yoy %

CER

FY16

FY15

yoy %

 

yoy %

CER

Total

41,322

30,659

35%

37%

49,462

36,538

35%

40%

90,784

67,197

35%

39%

 

 

 

 

 

 

 

 

 

Sales by region

 

 

 

 

 

 

 

 

 UK

26,273

20,686

27%

27%

32,855

24,919

32%

32%

59,128

45,605

30%

30%

 ROE

4,943

3,891

27%

45%

5,460

4,828

13%

26%

10,403

8,719

19%

34%

 USA

3,815

1,485

157%

143%

4,086

1,382

196%

181%

7,901

2,867

176%

161%

 ROW

6,291

4,597

37%

48%

7,061

5,409

31%

55%

13,352

10,006

33%

52%

 


 

 

£'000

4m to 31 December

2m to 29 February

12m to 29 February

 

FY16

FY15

yoy %

yoy % CER

FY16

FY15

yoy %

yoy %

CER

FY16

FY15

yoy %

 

yoy %

CER

Total

73,692

50,793

45%

49%

30,918

21,861

41%

40%

195,394

139,851

40%

42%

 

 

 

 

 

 

 

 

 

Sales by region

 

 

 

 

 

 

 

 

 UK

49,701

34,179

45%

45%

21,267

14,558

46%

46%

130,096

94,342

38%

38%

 ROE

8,588

6,464

33%

44%

3,639

2,903

25%

20%

22,630

18,086

25%

35%

 USA

5,962

2,639

126%

116%

2,659

1,504

77%

63%

16,523

7,009

136%

123%

 ROW

9,441

7,511

26%

41%

3,353

2,895

16%

17%

26,145

20,414

28%

42%

 

 

 

 

 

CER in this appendix for the year ended 29 February 2016 is calculated using exchange rates prevailing during the year ending 29 February 2016.

Nomenclature: ROE - rest of Europe; ROW - rest of world; yoy - year-on-year; CER - constant exchange rate

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
FR KMGZDVKDGNZM
Close


London Stock Exchange plc is not responsible for and does not check content on this Website. Website users are responsible for checking content. Any news item (including any prospectus) which is addressed solely to the persons and countries specified therein should not be relied upon other than by such persons and/or outside the specified countries. Terms and conditions, including restrictions on use and distribution apply.

 


Final Results - RNS