RNS Number : 8399Z
Tasty PLC
19 September 2022
 

19 September 2022

 

 

Tasty plc

 

("Tasty", the "Group" or the "Company")

 

Unaudited Interim Results for the 26 weeks ended 26 June 2022

 

Key Points:

·    Revenue of £21.5m (H1 2021: £11.6m); increase of 85%

·    Adjusted EBITDA1 of £2.7m (H1 2021: £0.8m)

·    Impairment charge of £1.6m (H1 2021: £nil)

·    Loss after tax for the period of £2.7m (H1 2021: loss £2.7m)

·    Outstanding loan of £1.1m repaid in full in June 2022 (H1 2021: £1.25m)

·    Net cash after allowing for deferred creditors of £7.0m (H1 2021: net cash after allowing for repayment of bank loan and deferred creditors of £4.2m)

·    51 of 54 restaurants traded through the period

·    Staff shortage challenges remain

·    Cost of living pressures beginning to impact on revenue in H2 2022

·    Inflationary pressure on labour, food and utilities has impacted the business considerably

·    Despite staffing and inflationary challenges like-for-like sales compared with pre Covid-19 position was encouraging

 

1                      Adjusted for depreciation, amortisation and share based payments.

 

Chairman's statement

 

Introduction

 

Following the difficult period of the pandemic, we started 2022 expecting the year to be less challenging. Sales performance compared to 2019 was strong but has been marred by labour shortages and inflationary pressures impacting the hospitality industry. These cost pressures became more acute towards the end of the first half of 2022.

 

Like many of our competitors and the economy in general, we are facing severe headwinds.   Inflationary pressures on food, labour and utility costs and the cost-of-living crisis will inevitably impact the performance of the Company for at least the remainder of the year.

 

Having navigated our way successfully through the difficult periods in the recent past, we are in a good position to manage these challenges once again; through a tight focus on cost controls and ensuring that we are delivering an excellent experience for our customers.

 

We have agreed heads of terms for a new Wildwood site in Oxfordshire. Our dim t brand has experienced a resurgence, and we are converting the former underperforming Wildwood in Loughton to a dim t, which is due to open in the Autumn. Whilst there is a strong pipeline of sites identified, due to current uncertainties, we have slowed our previously announced expansion plans and will cautiously approach any new openings as we brace ourselves for an even more challenging economic environment, which is beginning to adversely impact our profitability in the second half of 2022.

 

We continue to build solid teams and have invested at a central level to overcome these challenges, streamline processes and enhance our offering.

 

In June 2022, we repaid the amount outstanding under our Barclays Bank facility of £1.1m and subsequently cancelled the facility. Based on the base rate at the time, there will be an annualised interest saving of approximately £57,000. The Board made the decision that repaying the loan was the best course of action given the Company's healthy cash balance and the base rates rise.

 

People

In a tight labour market, we are pleased to say that the number of people we employ is back to over 1,000 following the requisite redundancies during the pandemic. However, with a competitive labour market, we continue to work hard to engage our teams and ensure that we are competitive through continuously reviewing training, progression and pay.

In June 2022, Harald Samúelsson, stepped up to become an Executive Director with responsibility for food and operational support and, at the same time, Wendy Dixon was appointed as an independent Non-Executive Director.

Wendy has spent two decades working with global brands, in a variety of leadership roles in multiple markets. More recently she was appointed as M&C Saatchi Group's first Chief Growth Officer in 2019 with responsibility for leading internal collaboration, building the brand of the company externally and bringing together both capabilities and talent for new and existing clients to grow.

To focus and improve our food offering a new Head of Food joined the Company in May 2022 with the initial focus being the development of our Christmas menu.

 

Inflationary costs

To reduce the impact of food and labour challenges, our menu is constantly being reviewed. We are working with existing and new suppliers to minimise disruption and continue to re-tender. The well documented utility pressures are unprecedented, and the hospitality industry is particularly badly affected. The Government unveiled an energy support plan on 8 September 2022 to support businesses for six months, but the details have yet to be announced.  In the meantime, we are looking at ways of minimising our energy usage and improving efficiencies.

 

Environmental, social and governance

The wellbeing and safety of our employees and customers is at the centre of all that we do. We have also retained our focus on sustainability and the environmental impact of the business, and we are an equal opportunities employer.


Property negotiations

The Group has been successful in achieving rent reductions and lease concessions across most of the estate for the period impacted by Covid-19 with the final few agreements completed during H1 2022. We are continuing to review all our leases with a view to disposing or re-gearing low performing sites.

 

Results

Revenue increased by 85% to £21.5m (H1 2021: £11.6m). In the period under review, we have benefited from unrestricted dine-in sales and also grown our takeaway and delivery business.  However, we have seen a slowdown in the second half due to our focus on dine-in and changing consumer habits. Revenue for the comparative period in 2021 was severely impacted by the lockdown restrictions.

 

The adjusted EBITDA for the period was £2.7m (H1 2021: £0.8m).

 

Operating profit before highlighted items was £0.4m (H1 2021: loss £1.4m).

 

We have reviewed the impairment provision across the right-of-use-assets and fixed assets and have made a net provision of £1.6m (H1 2021: £nil). 

 

After taking into account all non-trade adjustments, the Group has a stated loss after tax for the period of £2.7m (H1 2021: loss £2.7m).

 

Cash flows and financing

 

Cash inflow from operations was £0.9m (H1 2021: £2.4m). Repayment of the bank loan amounted to £1.25m during the period (H1 2021: drawn down of £1.25m).

 

Overall, the net cash outflow for the period was £3m (H1 2021: inflow £1.8m). As at 26 June 2022, the Group had net cash after the bank loan of £8.0m (H1 2021: net cash of £8.6m). After allowing for deferred payments due to creditors, net cash was £7.0m (H1 2021: net cash of £4.2m).

 

Going concern

 

The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. In reaching this conclusion the Directors have considered the financial position of the Group, together with its forecasts for the next 12 months from the date of approval of these interim accounts and taking into account possible changes in trading performance. The going concern basis of accounting has, therefore, been adopted in preparing the interim financial report.

 


Outlook

Utility cost management and pressure on revenue as living costs continue to rise will be our biggest challenges over the coming months, although we await details of the Government's support package.  We will endeavour to mitigate all pressures carefully by continuing to focus on savings and customer experience. Despite these uncertainties the Board remains confident of managing current challenges and the Group will cautiously consider future expansion opportunities for growth.

Finally thank you once again to all our people, shareholders, suppliers and other stakeholders who continue to support us.

 

 

 

K Lassman

Chairman

Tasty plc

 


19 September 2022

 

 

Enquiries:

 

Tasty plc                                                               Tel: 020 7637 1166

 

Jonny Plant, Chief Executive

 

Cenkos Securities                                               Tel: 020 7397 8900

 

Katy Birkin/Mark Connelly

 

Certain of the information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (596/2014). Upon publication of this announcement via a regulatory information service, this information is considered to be in the public domain.


Consolidated statement of comprehensive income
for the 26 weeks ended 26 June 2022 (unaudited)


 

26 weeks

 to

 

 

26 weeks to

Restated

52 weeks

Ended

 

26 June

 

27 June

26 December

 

2022

 

2021

2021

 

£'000

 

£'000

£'000

 










Revenue

21,522

 

11,629

34,909

 





Cost of sales

(20,375)


(14,526)

(33,567)






Gross profit/(loss)

1,147

 

(2,897)

1,342

 





Other income

213


2,050

4,208






Total operating expenses

(2,778)


(628)

555






Operating profit/(loss) before highlighted items

445


(1,410)

4,112

Highlighted items

(1,863)


(65)

1,993






Operating (loss)/profit

(1,418)

 

(1,475)

6,105

Finance income

3


-

-

Finance expense

(1,249)


(1,263)

(2,497)






(Loss)/profit before tax

(2,664)

 

(2,738)

3,608

 





Income tax

 

-


-

-

(Loss)/profit and total comprehensive income for period and attributable to owners of the parent

 

 

(2,664)

 

(2,738)

3,608

(Loss)/profit per share attributable to the ordinary equity owners of the parent

 

 




Basic

(1.89p)


(1.94p)

2.56p

Diluted

(1.66p)


(1.85p)

2.27p

 

The table below gives additional information to shareholders on key performance indicators:       


Post IFRS 16


Pre IFRS 16


Post IFRS 16

Pre IFRS 16


26 weeks

to

 

26 weeks to

 

26 weeks

 to

26 weeks

 to

 

26 June

 

26 June

 

27 June

27 June

 

2022

 

2022

 

2021

2021

 

£'000

 

£'000

 

£'000

£'000

 







EBITDA before highlighted items

2,733

 

101

 

824

(1,207)

Depreciation of PP&E and amortisation

(958)

 

(980)

 

(663)

(689)

Depreciation of right-of-use assets (IFRS16)

(1,330)



(1,571)








Operating profit/(loss) before highlighted items

445

 

(879)

 

(1,410)

(1,896)

           

Analysis of highlighted items

 

26 weeks

 to

 

 

26 weeks to

Restated

52 weeks ended

 

26 June

 

27 June

26 December

 

2022

 

2021

2021

 

£'000

 

£'000

£'000

Profit on disposal of property plant and equipment

-


-

3

Restructuring costs

-


-

(7)

Impairment of right-of-use assets

(1,258)


-

(1,347)

Impairment (charge)/release of property, plant and equipment

 

(304)


 

-

 

3,207

Share based payments

(31)


(65)

(120)

(Loss)/gain on lease modifications

(270)


-

257

Total highlighted items

(1,863)

 

(65)

1,993

 

The above items have been highlighted to give more detail on items that are included in the Consolidated statement of comprehensive income and which when adjusted shows a profit or loss that reflects the ongoing trade of the business. 



Consolidated statement of changes in equity
for the 26 weeks ended 26 June 2022 (unaudited)


Share

Share

Merger

Retained

Total

 

Capital

Premium

Reserve

Deficit

Equity

 

£'000

£'000

£'000

£'000

£'000

 






Balance at 26 December 2021 (restated)

6,061

24,254

992

(26,980)

4,327

Total comprehensive income for the period

-

-

-

(2,664)

(2,664)

Share based payments - credit to equity

-

-

-

31

31

Balance at 26 June 2022

6,061

24,254

992

(29,613)

1,694

 






Balance at 27 December 2020

6,061

24,251

992

(30,708)

596

Issue of ordinary shares

-

3

-

-

3

Total comprehensive income for the period

-

-

-

(2,738)

(2,738)

Share based payments - credit to equity

-

-

-

65

65

Balance at 27 June 2021

6,061

24,254

992

(33,381)

(2,074)

 






Balance at 27 December 2020

6,061

24,251

992

(30,708)

596

Issue of ordinary shares

-

3

-

-

3

Total comprehensive income for the period

-

-

-

3,608

3,608

Share based payments - credit to equity

-

-

-

120

120

Balance at 26 December 2021 (restated)

6,061

24,254

992

(26,980)

4,327

 

In January 2021, Daniel Jonathan ("Jonny") Plant was awarded 15,676,640 'B' shares in Tasty plc which can be converted to 'A' shares subject to achievement of certain hurdle rates. These 'B' shares were issued at nominal value of 0.00001 pence. The first hurdle was achieved, and 5,225,546 B Ordinary Shares were converted into 5,225,546 new Ordinary Shares on 27 June 2022.

 

Consolidated balance sheet
At 26 June 2022 (unaudited)



 

26 weeks to

 

 

26 weeks

to

 

Restated

52 weeks ended

 


26 June

 

27 June

 

26 December

 


2022

 

2021

 

2021

 


£'000

 

£'000

 

£'000

Non-current assets

 






Intangible assets


28


30


28

Property, plant and equipment


17,282


15,098


18,026

Right-of-use- assets


34,639


38,337


36,006

Other non-current assets


65


129


105

Total non-current assets

 

52,014

 

53,594

 

54,165

 







Current assets

 






Inventories


1,995


1,834


2,103

Trade and other receivables


2,949


1,397


1,355

Cash and cash equivalents


8,010


9,884


11,005

Total current assets 

 

12,954

 

13,115

 

14,463

 

 

 

 

 

 

 

Total assets

 

64,968

 

66,709

 

68,628

 







Current liabilities

 






Trade and other payables


(10,336)


(12,210)


(10,493)

Lease liabilities


(2,202)


(3,620)


(2,024)

Borrowings


-


(104)


(313)

Total current liabilities


(12,538)

 

(15,934)

 

(12,830)

 







Non-current liabilities

 






Provisions


(335)


(335)


(297)

Lease liabilities


(50,273)


(51,288)


(50,157)

Long-term borrowings


-


(1,146)


(937)

Other payables


(128)


(80)


(80)

Total non-current liabilities

 

(50,736)

 

(52,849)

 

(51,471)

 

 

 

 

 

 

 

Total liabilities


(63,274)

 

(68,783)

 

(64,301)

 







Total net assets/(liabilities)


1,694

 

(2,074)

 

4,327

 







Equity

 






Share capital


6,061


6,061


6,061

Share premium


24,254


24,254


24,254

Merger reserve


992


992


992

Retained deficit


(29,613)


(33,381)


(26,980)

Total equity


1,694

 

(2,074)

 

4,327

 

Consolidated cash flow statement
for the 26 weeks ended 26 June 2022 (unaudited)

 



26

weeks to

 

26

weeks to

 

52

weeks ended

 


26 June

 

27 June

 

26 December

 


2022

 

2021

 

2021

 


£'000

 

£'000

 

£'000

 







Operating activities

 






Cash generated from operations


945


2,365


7,826

Net cash inflow from operating activities

945

 

2,365

 

7,826

 







Investing activities

 






Proceeds from sale of property, plant and equipment

-


-


3

Purchase of property, plant and equipment


(516)


(192)


(544)

Interest received


3


-


-

Net cash flows used in investing activities

(513)

 

(192)

 

(541)

 







Financing activities

 






Net proceeds from issue of ordinary shares


-


3


3

Bank loan receipts


-


1,250


1,250

Bank loan repayment


(1,250)


-


-

Finance expense


(30)


(26)


(59)

Finance expense (IFRS 16)


(1,219)


(1,237)


(2,438)

Principal paid on lease liabilities


(928)


(307)


(3,064)

Net cash flows used in financing activities

(3,427)

 

(317)

 

(4,308)

 







Net increase in cash and cash equivalents


(2,995)


1,856


2,977

Cash and cash equivalents at beginning of the period

11,005


8,028


8,028

Cash and cash equivalents as at 26 June 2022

8,010

 

9,884

 

11,005

 

Notes to the condensed financial statements
for the 26 weeks ended 26 June 2022 (unaudited)

1    General information

Tasty plc is a public limited company incorporated in the United Kingdom under the Companies Act (registration number 05826464). The Company is domiciled in the United Kingdom and its registered address is 32 Charlotte Street, London, W1T 2NQ. The Company's ordinary shares are traded on the AIM Market of the London Stock Exchange ("AIM"). Copies of this Interim Report and the Annual Report and Financial Statements may be obtained from the above address or on the investor relations section of the Company's website at www.dimt.co.uk.

2    Basis of accounting

The condensed set of financial statements included in this interim financial report has been prepared in accordance with IAS 34 'Interim Financial Reporting', as adopted by the United Kingdom and accounting policies consistent with International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations Committee (IFRIC) interpretations as endorsed by the United Kingdom. The same accounting policies, presentation and methods of computation have been followed in the preparation of these results as were applied in the Company's latest annual audited financial statements.

 

The financial information for the 26 weeks ended 26 June 2022 has not been subject to an audit nor a review in accordance with International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity, issued by the Financial Reporting Council.

The financial information for the period ended 26 December 2021 does not constitute the full statutory accounts for that period. The Annual Report and Financial Statements for 2021 have been filed with the Registrar of Companies. The Independent Auditors' Report on the Annual Report and Financial Statements for 2021 was unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

The condensed financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (£'000).

Except when otherwise indicated, the consolidated accounts incorporate the financial statements of Tasty plc and its subsidiary, Took Us A Long Time Limited, made up to the relevant period end.

Use of judgements and estimates

In preparing these interim financial statements management has made judgements and estimates that affect the application of accounting policies and measurement of assets and liabilities, income and expense provisions. Actual results may differ from these estimates. 

Going concern

The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. In reaching this conclusion the Directors have considered the financial position of the Group, together with its forecasts for the next 12 months from the date of approval of these interim accounts and taking into account possible changes in trading performance. The Group monitors cash balances and impact of inflation closely to ensure there is sufficient liquidity. Accordingly, the Directors believe that it remains appropriate to prepare the financial statements on a going concern basis.

IFRS 16 'Leases'

Group's accounting policies for leases are as follows:

Lessee accounting

IFRS 16 distinguishes between leases and service contracts on the basis of whether the use of an identified asset is controlled by the customer. Control is considered to exist if the customer has:

•     The right to obtain substantially all of the economic benefits from the use of an identified asset; and

•     The right to direct the use of that asset in exchange for consideration.

 

The Group first adopted IFRS 16 for its period starting 30 December 2019 using the modified retrospective approach on transition, recognising leases at the carried forward value had they been treated as such from inception, without restatement of comparative figures. On adoption of IFRS 16, the Group recognised right-of-use assets and lease liabilities in relation to the restaurant sites it leases for its business.

 

All leases are accounted for by recognising a right-of-use asset and a lease liability except for:

•     Leases of low value assets, and

•     Leases with a duration of 12 months or less.

 

Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the remaining term of the lease.

Lessor accounting

Under IFRS 16, a lessor continues to classify leases as either finance leases or operating leases and account for those two types of leases differently.

Based on an analysis of the Group's operating leases as at 26 June 2022 on the basis of the facts and circumstances that exist at that date, the Directors of the Group have assessed that the impact of this change has not had any impact on the amounts recognised in the Group's consolidated financial statements.

Short-term leases and leases of low-value assets

The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that have a lease term of 12 months or less and leases of low value assets. The Group recognises these payments as an expense on a straight-line basis over the lease term. Currently the Group has no low value assets or short-term leases.

 

Covid-19 related rent concessions

IFRS 16 defines a lease modification as a change in the scope of a lease, or the consideration for a lease, that was not part of the original terms and conditions of the lease. The Group has considered the Covid-19 related rent concessions and applied the lease modifications accounting treatment, rather than the practical expedient.

 

Impairments

 

All assets (ROU and fixed assets) are reviewed for impairment in accordance with IAS 36 Impairment of Assets, when there are indications that the carrying value may not be recoverable.

Assets are subject to impairment tests whenever events or changes in circumstances indicate that their carrying amount may not be recoverable. Where the carrying value of an asset or a cash generating unit (CGU) exceeds its recoverable amount, i.e. the higher of value in use and fair value less costs to dispose of the asset, the asset is written down accordingly. The Group views each restaurant as a separate CGU.   Value in use is calculated using cash flows excluding outflows from financing costs over the remaining life of the lease for the CGU discounted at 8% (2021: 6%), being the rate considered to reflect the risks associated with the CGUs. A growth rate of 2% has been applied (2021: 0.5%).

An impairment review was undertaken across the ROU assets and fixed assets which resulted in a net impairment charge of £1.6m (2021: £nil).  Where an impairment reversal is recognised, the carrying amount of the asset will be increased to its recoverable amount with the increase being recognised in the income statement. This increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years.

The assumptions will be reviewed at year-end to ensure that the cashflow expectations are in line with the latest outlook.

 

Other income

 

In accordance with IAS 20 (Accounting for Government Grants and Disclosure of Government Assistance) guidelines, the Group has recognised the salary expense as normal and recognised the grant income in profit and loss as the Group becomes entitled to the grant.

Other income includes Government Coronavirus Job Retention Scheme ("CJRS") of £nil (2021: £1.9m), sub-let property income of £0.2m (2021: £0.1m) and Government Grants of £nil (2021: £1.8m).

 

3     Income tax

The income tax charge has been calculated by reference to the estimated effective corporation tax and deferred tax rates of 19% (2021: 19%).

Tax charge £nil (2021: £nil).

4    Earnings per share





26 weeks to

 

26 weeks to

 

Restated 52 weeks ended

 




26 June

 

27 June

 

26 December

 




2022

 

2021

 

2021

 




Pence

 

Pence

 

Pence

 









Basic (loss)/profit per ordinary share



(1.89p)


(1.94p)


2.56p

Diluted (loss)/profit per ordinary share



(1.66p)


(1.85p)


2.27p












26 June 2022

 

27 June 2021

 

26 December 2021




Number '000

 

Number '000

 

Number

 '000

Profit/(loss) per share has been calculated using the numbers shown below:








Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share



 

 

 

141,090


 

 

 

141,090


 

 

 

141,090









Adjustments for calculation of diluted earnings per share:
















Ordinary B shares



15,677


6,977


14,815

Options



3,265


-


3,265









Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating diluted earnings per share



 

 

 

 

160,032


 

 

 

 

148,067


 

 

 

 

159,170












 

26 June 2022


 

27 June

2021


Restated

 26 December 2021




£'000


£'000


£'000

(Loss)/profit for the financial period



 

(2,664)


 

(2,738)


 

3,608

 

The basic and diluted (loss)/profit per share figures are calculated by dividing the net (loss)/profit for the period attributable to shareholders by the weighted average number of ordinary shares in issue during the period. The diluted earnings per share figure allows for the dilutive effect of the conversion into ordinary shares of the weighted average number of options outstanding during the period. Options are only taken into account when their effect is to reduce basic earnings per share.

5    Reconciliation of result before tax to net cash generated from operating activities

 


26 weeks to

 

26 weeks to

 

Restated 52 weeks ended

 

26 June

 

27 June

 

26 December

 

2022

 

2021

 

2021

 

£'000

 

£'000

 

£'000

 






(Loss)/profit before tax

(2,664)


(2,738)


3,608

Finance income

(3)


-


-

Finance expense

30


26


59

Finance expense (IFRS 16)

1,219


1,237


2,438

Share based payment charge

31


65


120

Depreciation of right-of-use assets (IFRS 16)

1,330


1,545


2,579

Depreciation of property, plant and equipment

956


687


1,297

Amortisation of intangible assets

2


2


3

Impairment charge/(release) of property, plant and equipment

304


-


(3,207)

Impairment of Right-of-use assets

1,258


-


1,347

Profit from sale of property, plant and equipment

-


-


(3)

Dilapidations provision charge

38


-


-

Dilapidations provision utilisation

-


-


(38)

(Increase)/decrease in inventories

108


(12)


(282)

(Increase)/decrease in trade and other receivables

(1,553)


(34)


32

Increase/(decrease) in trade and other payables

(111)


1,587


(127)

Net cash inflow from operating activities

945

 

2,365

 

7,826

 

6    Property, plant and equipment and right-of-use assets


Leasehold improvements

Furniture fixtures and computer equipment

Total fixed assets

 

ROU assets

 

Total

£'000

£'000

£'000

 

£'000

 

£'000

 







At 27 December 2020

37,176

9,892

47,068


53,446


100,514









Additions

145

399

544


951


1,495

Lease modification

-

-

-


(830)


(830)

At 26 December 2021

37,321

10,291

47,612

 

53,567

 

101,179









249

267

516


-


516

-

-

-


1,221


1,221

At 26 June 2022

37,570

10,558

48,128

 

54,788

 

102,916









 







At 27 December 2020

23,834

7,662

31,496


13,635


45,131

Provided for the period

743

554

1,297


3,142


4,439

Impairments

157

100

257


(257)


-









At 26 December 2021 (as previously stated)

24,734

8,316

33,050


16,520


49,570

 








Prior year adjustment

(2,677)

(787)

(3,464)


1,041


(2,423)

 








At 26 December 2021 (as restated)

22,057

7,529

29,586


17,561


47,147

 








Provided for the period

587

369

956


1,330


2,286

Impairments

295

9

304


1,258


1,562

At 26 June 2022

22,939

7,907

30,846

 

20,149

 

50,995

 

 







 







At 26 June 2022

14,631

2,651

17,282

 

34,639

 

51,921

 








At 26 December 2021 (as restated)

15,264

2,762

18,026


36,006


54,032


Prior year adjustment

The prior year adjustment relates to the treatment of depreciation on impaired assets and reversal of impairment.

The depreciation charge on ROU assets should have been reduced for the impairment to allow depreciation to run to the end of the life of the lease. In addition, when reversing an impairment that depreciation should be recognised if the amount at which the asset would have been carried (net of depreciation) had there been no impairment or the lower or the irrecoverable amount. 



52 weeks

Ended 26 December (as restated)

 

 

 

 

Adjustment

 

52 weeks

Ended 26 December (as previously stated)

 


2021

 

2021

 

2021

 


£'000

 

£'000

 

£'000

Cost of sales


(33,567)


563


(34,130)

Operating expenses


555


1,860


(1,305)

Highlighted items (included within Operating expenses)


1,993


1,860


133

Profit and total comprehensive income for the period

3,608


2,423

 

1,185








At 26 December 2021

(as restated)


 

 

 

Adjustment

 

 

 

At 26 December 2021

(as previously stated)

 

 

2021


2021


2021

 

£'000


£'000


£'000

Non-current assets






Property, plant and equipment

18,026


3,464


14,562

Right-of-use assets

36,006


(1,041)


37,047







Equity






Retained deficit

(26,980)


2,423


(29,403)

Total equity

4,327


2,423

 

1,904

 

7    Leases



26

weeks to

 

26

weeks to

 

52

weeks ended

 


26 June

 

27 June

 

26 December

 


2022

 

2021

 

2021

 


£'000

 

£'000

 

£'000

Current







Lease liabilities

 

2,202


3,620


2,024

 







Non-current

 






Lease liabilities

50,273


51,288


50,157








Total

52,475

 

54,908

 

52,181

 


 

 

 

 

 


 

 

 

 

Due within one year

2,202

 

3,620

 

2,024

Due two to five years

12,792

 

15,362

 

12,371

Due over five years

37,481

 

35,926

 

37,786

Total

52,475

 

54,908

 

52,181

 

Lease liabilities are measured at the present value of the remaining lease payments, discounted using the Group's incremental borrowing rate of 4.5% and the Bank of England (BoE) base rate at the time of any lease modification or a new lease.  The average rate used for modification in 2022 was 5.1% (2021: 4.6%).

 

The lease liabilities as at 26 June 2022 were £52.5m (2021: £54.9m).

 

The right-of-use assets all relate to property leases. The right-of-use assets as at 26 June 2022 were £34.6m (2021: £38.3m). During the period ended 26 June 2022 the Group made a provision for impairment of the right-of-use assets against a number of sites totalling £1.3m (2021: £nil). 

 

Included in profit and loss for the period is £1.3m depreciation of right-of-use assets and £1.2m financial expenses on lease liabilities.

8    Borrowings


26 weeks to

 

26 weeks to

 

52 weeks ended

 

26 June 2022

 

27 June 2021

 

26 December 2021

 

£'000

 

£'000

 

£'000

Current






Secured bank borrowings

-


104


313

Non-current

 





Secured bank borrowings

-


1,146


937

Total

-

 

1,250

 

1,250

 

The £1.25m loan was a four-year term loan which had a capital repayment holiday of 12 months and carried interest at a rate of 4.5% per annum over the Bank of England Base Rate. The outstanding loan of £1.25m was repaid in full during the period.

 

9    Reconciliation of financing activity


 

Lease liabilities

Lease liabilities

Bank Loan

Bank Loan

 

Total

 


 

Due within 1 year

Due after 1 year

Due within 1 year

Due after 1 year

 


 

£'000

 

£'000

£'000

£'000

£'000


Net debt as at 30 December 2019

1,647

55,761

800

852

59,060


Cashflow

 

(1,735)

 

-

(800)

(852)

(3,387)


Addition/(decrease) to lease liability

 

2,992

 

(3,542)

 

-

 

-

 

(550)


Net debt as at 27 December 2020

2,904

52,219

-

-

55,123


Cashflow

(3,064)

-

313

937

(1,814)


Addition/(decrease) to lease liability

2,184

(2,062)

-

-

122


Net debt as at 26 December 2021

2,024

50,157

313

937

53,431


Cashflow

(927)

-

(313)

(937)

(2,177)


Addition/(decrease) to lease liability

1,105

116

-

-

1,221


Net debt as at 26 June 2022

2,202

50,273

-

-

52,475

 

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