SCY
27/06/2013 13:38
FLLYR
REL: 1338 HRS Smiths City Group Limited
FLLYR: SCY: SMITHS CITY BOOSTS PROFIT - Full Year Results 30.4.13
Smiths City Group Limited
Audited Full Year Result To 30 April 2013 For Announcement To The Market
Current reporting period: 12 months to 30 April 2013
Previous reporting period: 12 months to 30 April 2012
Amount
$m Percent change
Revenue from ordinary activities 222.5 0.0%
Profit from ordinary activities after tax attributable to security holders
5.4
+22.7%
Net profit attributable to security holders 5.4 +22.7%
Amount per security
Final dividend; year to 30 April 2013 2.5 cents
Imputed amount per security 0 cents
Record date 9 August 2013
Dividend payment date 16 August 2013
Earnings per security Current year Prior year
Basic EPS (cents) 10.21 8.28
Net tangible Assets per Share (cents) 84.42 76.66
Preliminary full year report on consolidated results (including the results
for the previous corresponding full year) in accordance with Listing Rule
10.4.2.
This financial result, which has been audited, has been prepared in
accordance with New Zealand International Financial Reporting Standards,
which is consistent with the prior full year.
Smiths City Group Limited has a formally constituted Audit Committee of the
Board of Directors.
27.6.13 - FULL YEAR RESULT ANNOUNCEMENT
SMITHS CITY BOOSTS PROFIT
The Directors of Smiths City Group Limited, the Christchurch based retailer,
have announced an operating surplus after taxation for the 12 months to 30
April 2013 of $5.4million (last year $4.3million) - an increase of 22.7%.
Operating revenues for the 12 months remained static at $222.5million.
The Directors have declared an unimputed final year dividend of 2.5cents per
share (last year 2.5cents) to be paid on Friday 16 August 2013. The dividend
will be paid to those shareholders on the Share Register at 5.00pm Friday 9
August 2013.
The summary of consolidated results is as follows:
12 MTHS
30.4.13
$m 12 MTHS
30.4.12
$m
% INC
/DEC
Operating Revenue 222.5 222.5
Profit From Operations 2.4 4.0
Other Income 5.5 -
Refinancing Break Costs (1.6) -
Operating Surplus From Trading 6.3 4.0 +57.5%
Share of Profit (Loss) Equity Accounted Investee - (0.1)
Operating Surplus Before Taxation 6.3 3.9 +61.5%
Deferred Taxation (Charge)/Credit * (0.9) 0.5
Operating Surplus After Taxation 5.4 4.4 +22.7%
The deferred tax charge for the current year takes into account temporary
differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation purposes as
well as the movement in the company's estimates of future taxable profits on
the basis these can be offset against the tax losses available. Smiths City
has available carry forward tax losses of $10.8million, hence no income tax
is payable.
Commenting on the result Chairman Craig Boyce said "The Board of Directors
are very pleased to report an overall increase in profit in what has been a
challenging but overall a successful 12 month period.
The major highlight during the year was the successful refinancing of the
company's finance arm Smithcorp Finance Limited to a tier one bank. Whilst
this required an increase of approximately $7.3million in equity and incurred
one off costs of $1.6million, the long term savings in interest, which at
current business levels are anticipated to exceed $2.5million per annum, will
clearly yield substantial and sustainable benefits to the Group.
Trading in the South Island was positive as the company had the advantage of
a predominantly strong rural sector. The North Island, particularly in the
Wellington region, was more subdued. In Wellington the company closed its
underperforming Upper Hutt store and in the 2014 financial year will
strengthen its retail offering by moving to a far superior location within
the Porirua Mega Centre and opening a new store on Kapiti Coast. It will
continue to investigate further North Island opportunities as they arise.
The Colombo Street, Christchurch property is a major asset to the Group and,
prior to the February 2011 earthquake, housed the company's largest retail
store, its administration office and five properties leased by third parties.
Having got the store up and trading in a smaller footprint in November 2011
the company has continued to work positively with its insurers. An indemnity
payment of $5.5million was received during the year and the Board has now
approved plans to finalise areas still needing repair, to increase the
available retail space to very nearly what was available pre-earthquake and
to bring the building up to 100% of new building code.
Plans for the administration building - also demolished following the 2011
earthquake - will be reviewed in 2014.
Looking ahead retail trading remains subdued in our sector and always highly
competitive. However, having now put the earthquake behind us, the outlook
for the Group is positive.
Managing Director, Rick Hellings, added "Whilst the events in Christchurch
have continued to throw up their challenges, the results reflect the efforts
of everyone in the Group.
The company's profit from operations was adversely affected by increases in
insurance costs (as forecast last year); a one off impairment charge on the
value of intangible assets on the balance sheet and a further one-off cost
incurred to break the lease on the existing Porirua store.
The Wellington region has been the most difficult geographic area from a
trading viewpoint. Management is confident that actions taken to date,
combined with the "Go Forward" plan outlined by the Chairman above, will fix
this and improve results to be in line with the remainder of the Group.
The smaller footprint in the Colombo Street, Christchurch store has traded
above expectations and the opportunity to now get the retail floor back to
pre-earthquake size is hugely positive. This, together with an expanded
Christchurch based commercial division, means the company is well placed to
take advantage of opportunities the Christchurch rebuild will offer.
Also in Christchurch the company reopened its Moorhouse Avenue store which
now houses both Powerstore and Furniture Concepts.
The trading environment continues to change rapidly, particularly in the
technology area. This applies to both the style of product we are selling
and the way customers are buying. In particular, we are experiencing an
increasing trend for customers to buy on the internet and this is an area in
which the company will continue to invest and expects to see further
significant increases in sales.
Management does not expect to see trading conditions change significantly
and, as a result, whilst the company prides itself on its commitment to
providing superior service levels than its competitors it must continue to
meet the promotional offers in the market
RICK HELLINGS
MANAGING DIRECTOR
0299833011
End CA:00237887 For:SCY Type:FLLYR Time:2013-06-27 13:38:37
