Company Announcements

Interim Results

Source: RNS
RNS Number : 4056E
Comptoir Group PLC
17 September 2024
 

 

Comptoir Group Plc

 

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

 

Interim Results

 

Comptoir Group Plc (AIM: COM), the owner and operator of Lebanese, Middle Eastern and North African inspired restaurants is pleased to announce its interim results for the six months ending 30 June 2024.

 

Financial Highlights:

 

·      Group revenue of £15.9m, an increase of 7.4% on the same period last year (H1 2023: £14.8m)

·      System sales of £20.2m, an increase of 7.4% on the same period last year (H1 2023 £18.8m)

·      Gross profit of £12.7m, an increase of 10.4% on the same period last year (H1 2023: £11.5m)

·      Adjusted EBITDA* loss before highlighted items of £0.6m (H1 2023: £0.3m loss)

·      IFRS loss after tax of £1.7m (H1 2023: £0.8m loss)

·      Net cash and cash equivalents at the period end of £4.9m (H1 2023: £7.6m, 31 December 2023: £7.0m)

·      The basic loss per share for the period was 1.42 pence (H1 2023: basic loss per share 0.64 pence)

 

 

Operational Highlights:

 

·      The Group opened a new flagship restaurant in Southbank London and brought Cheshire Oaks Outlet Centre back into the managed portfolio from its franchisee. Yalla Yalla Soho closed in February 2024 and subsequent to the half year Ashford Outlet Centre franchise restaurant closed.

·      During the half year the Group has also opened two new franchised restaurants in major international airports, Shawa in Abu Dhabi and Comptoir Libanais, with a new partner, in Milan.

·      At the half year the Group owns and operates 22 equity restaurants, with a further 7 franchise restaurants across two partners.

·      Subsequent to the half year the Group welcomed James Fisher as Finance Director and member of the Board. This followed the appointment of Ali Aneizi as Non-Executive Director and Jean-Michel Orieux to Non-Executive Chair in June 2024.

 

Current trading and Outlook:

 

Despite economic challenges and rising costs, the Group is seeing positive results from its strategic initiatives. The Group is confident that its proactive measures will lead to improved performance in the second half of the year and beyond, with trading since the half year in line with expectations. There does however remain an element of uncertainty with regard to the impact of the new government, particularly with respect to planned future National Minimum Wage increases and business rates reform. The upcoming Budget in October will hopefully provide some further clarity.

 

The Group aims to leverage the investments it has made to deliver enhanced EBITDA and cashflows. With a full leadership team now in place, the Board has confidence in the prospects for the longer term.

 

 

 

*Adjusted EBITDA was calculated from the pre-IFRS 16 loss after taxation adding back interest, tax, depreciation, share-based payments, and other non-cash and non-recurring costs.

 

 

Enquiries:

 

Comptoir Group plc

Jean-Michel Orieux, Non-Executive Chair

Nick Ayerst, CEO

 

0207 486 1111

Cavendish Capital Markets Limited (Nominated Adviser and Broker)

Corporate Finance: Carl Holmes, Abigail Kelly

Corporate Broking: Charlie Combe

 

 

020 7220 0500



 

 

About Comptoir Group

 

Comptoir Group PLC owns and operates 28 Lebanese restaurants, six of which are franchised, based predominately in the UK. The flagship brand of the group, Comptoir Libanais, is a collection of 22 restaurants located across London, nationwide and international Travel Hubs, including cities such as Manchester, Bath, Birmingham, Oxford, Dubai and Milan.

The name Comptoir Libanais means Lebanese Counter and is a place where guests can eat casually and enjoy Middle Eastern and North African food, served with warm and friendly hospitality and a bright vibrant environment.

The Group also operates Shawa, serving traditional shawarma through a counter service model in Westfield and Bluewater shopping centres and Abu Dhabi, Yalla-Yalla with a branch near Oxford Circus, and entertainment venue Kenza, located in Devonshire Square, London.

The group has expanded internationally with its franchise partners Avolta and Areas, with restaurants in the Netherlands, Qatar and UAE and Italy.

 

 

 

 

 

 

Chairman's review

 

In my first statement as Chair, I am able to report on the continued evolution and rebuilding of the Group. Our core estate performed in line with our expectations delivering a like for like revenue growth of 0.9% and an improved gross profit. During this period, we strategically invested in our business to strengthen our competitive position. This included:

 

·      Our Teams: Enhancing our teams' capabilities to deliver exceptional guest experiences.

·      Our Products: Reintroducing beloved classics while introducing exciting new flavours to cater to evolving customer preferences.

·      Brand Experience: Refreshing our physical presence through estate refurbishments and expanding our network with new locations.

 

The Group maintains a cash balance of £4.9m at the half year after our significant investments, which provides us with a platform from which we can continue our ongoing work to solidify the foundations of the business before moving on to revisiting our growth plans. Following these investments we remain focussed on protecting and growing our cash position through improved profitability from our restaurants and careful cost management.

 

The half year outturn is set against a backdrop of wider uncontrollable and adverse factors, which continued through the first half year of 2024, namely the ongoing macroeconomic uncertainty caused by the cost-of-living crisis, its impact on people's disposable income and the recent years of National Minimum Wage growth. We continue to address underperforming restaurants and will take the appropriate action with these, and our cost base overall.

 

We remain optimistic about the longer-term prospects of the Group, given our unique offering, our teams, the balance of our portfolio, our brands, the mix of equity and franchised stores and obsession with creating a casual relaxed family orientated dining experience. However, we must solidify our business and ensure we have the right platform in place before we can accelerate our growth.  

 

 

 

Chief executive's review

 

I am pleased to report a solid H1 against a backdrop of sector volatility. This is a testament to the hard work of our staff across the business and I would like to thank them for their efforts during the period.

 

Financial Performance Half-Year:

 

The total revenue for the Group for the half-year was £15.9m (H1 2023: £14.8m) and the adjusted EBITDA loss was £0.6m (H1 2023: £0.3m loss). The Group controls remained strong but a combination of ongoing cost pressures and a conscious decision to invest in the labour of our new sites post opening has impacted profitability. Group EBITDA fell marginally compared to the same period last year, largely due to favourable delayed rent reviews and lease extensions creating artificially low fixed costs in the prior year. The IFRS loss after tax was £1.7m (H1 2023: £0.8m loss). The Group cash balance at the half-year was £4.9m (H1 2023: £7.6m) after investment in new sites and refurbishments during the period and continued repayment of our CBIL loan. The outstanding balance on the CBIL at the half year was £1.3m (H1 2023: £1.9m).

 

A summary of the financial performance for the half year is shown in the table below:

 


 Post IFRS 16

 Pre  IFRS 16

 Post IFRS 16

 Pre  IFRS 16

 Post IFRS 16

 Pre  IFRS 16

 

30 June
2024

30 June
2024

2 July
2023

2 July
2023

31 December 2023

31 December 2023

 

 £

 £

 £

 £

 £

 £

 







Revenue

15,907,238

15,907,238

14,801,949

14,801,949

31,480,609

31,480,609








Adjusted EBITDA:

 













Loss after tax

(1,738,054)

(1,318,045)

(780,460)

(545,243)

(1,599,431)

(1,365,090)

Add back:







Finance costs

678,955

58,550

497,567

67,731

1,019,154

136,551

Finance income

(76,654)

(76,654)

-

-

(94,147)

(94,147)

Taxation

(469,594)

(469,594)

(496,100)

(496,100)

(45,674)

(45,674)

Depreciation

1,928,133

686,468

1,655,805

561,532

3,328,567

1,124,210

Impairment of assets

-

-

-

-

107,316

-

EBITDA

322,786

(1,119,275)

876,812

(412,080)

2,715,785

(244,150)

Share-based payments (credit) / expense

(12,510)

(12,510)

10,006

10,006

30,541

30,541

Loss on disposal of fixed assets

123,479

123,479

-

-

8,940

8,940

Exceptional legal fees

103,357

103,357

23,045

23,045

101,145

101,145

Restaurant opening costs

331,996

331,996

-

-

88,886

88,886

Restaurant closing costs

5,196

5,196

75,657

75,657

76,649

76,649

Dilapidations

15,723

15,723

16,493

16,493

-

-

Adjusted EBITDA

890,027

(552,034)

1,002,013

(286,879)

3,021,946

62,011

 

 

 

The trading performance of our core estate has seen like for like revenue growth on our equity sites of 0.9% and an increase in Gross profit. Despite the backdrop of a weak economic environment and continuing cost pressures we remain confident in our strategy to grow sales and EBITDA together with maintaining a healthy cash position.

 

In the first half of the year we continued to improve the quality of our food whilst also improving margins and maintaining strong value for money scores. This sits alongside our highest NPS ratings at over 75, a testament to our teams in each restaurant. These improvements were alongside a busy period of new openings and I thank the team for everything they have done in the half year. Our full focus is on our like for like estate and ensuring all investments realise returns at the expected rate.

 

With a full senior leadership team now in place we are focussed on delivery against our 5 strategic pillars

 

·      Culture: Fostering a high-performance culture that empowers our team and aligns with our values.

·      Customer Experience: Enhancing guest satisfaction through digital innovations and personalised offerings.

·      Efficiency: Optimising operations and costs while maintaining our value proposition.

·      Financial Health: Ensuring strong returns on investments and aligning future expenditures with cash generation.

·      Growth: Expanding our footprint through organic growth and strategic acquisitions.

 

Current trading and Outlook:

 

Despite economic challenges and rising costs, the Group is seeing positive results from its strategic initiatives. The Group is confident that its proactive measures will lead to improved performance in the second half of the year and beyond, with trading since the half year in line with expectations. There does however remain an element of uncertainty with regard to the impact of the new government, particularly with respect to planned future National Minimum Wage increases and business rates reform. The upcoming Budget in October will hopefully provide some further clarity.

 

The Group aims to leverage the investments it has made to deliver enhanced EBITDA and cashflows. With a full leadership team now in place, the Board has confidence in the prospects for the longer term.

 

 

 

 

Nick Ayerst

Chief Executive Officer

17 September 2024



 

Consolidated statement of comprehensive income

For the half-year ended 30 June 2024

 

 

 

 

Notes

Half-year ended 30 June 2024

Half-year ended 2 July 2023

Period ended 31 December 2023

 


 £

 £

 £

Revenue


15,907,238

14,801,949

31,480,609

Cost of sales


(3,183,004)

(3,264,510)

(6,760,622)

Gross profit

 

12,724,234

11,537,439

24,719,987

Distribution expenses


(6,931,378)

(6,077,722)

(12,624,578)

Administrative expenses


(7,423,787)

(6,246,967)

(12,866,121)

Other income


25,584

8,257

50,614

Operating loss

3

(1,605,347)

(778,993)

(720,098)

Finance costs


(678,955)

(497,567)

(1,019,154)

Finance income


76,654

-

94,147

Loss before tax

 

(2,207,648)

(1,276,560)

(1,645,105)

Taxation credit


469,594

496,100

45,674

Loss for the year

 

(1,738,054)

(780,460)

(1,599,431)

Other comprehensive income


-

-

-

Total comprehensive loss for the year

 

(1,738,054)

(780,460)

(1,599,431)

 


 

 


Basic loss per share (pence)

6

(1.42)

(0.64)

(1.30)

Diluted loss per share (pence)

6

(1.41)

(0.64)

(1.30)

      

 

All the above results are derived from continuing operations.

Consolidated balance sheet

At 30 June 2024


Notes

30 June 2024

2 July 2023

31 December 2023

 


£

£

£

Non-current assets

 




Intangible assets

7

7,284

29,134

7,284

Property, plant and equipment

8

8,216,648

6,536,519

6,771,722

Right-of-use assets

8

15,257,254

12,607,187

13,008,673

Deferred tax asset

 

197,651

224,133

-

                                                                                            

 

23,678,837

19,396,973

19,787,679

Current asset

 




Inventories


471,182

526,071

521,488

Trade and other receivables


1,775,201

1,379,568

1,344,710

Cash and cash equivalents

 

4,850,040

7,640,868

7,048,757



7,096,423

9,546,507

8,914,955

 





 

30,775,260

28,943,480

28,702,634

 





Current liabilities

 




Borrowings


(600,000)

(600,000)

(600,000)

Trade and other payables


(7,400,107)

(5,793,557)

(5,964,996)

Lease liabilities


(2,653,367)

(1,165,194)

(2,159,265)



(10,653,474)

(7,558,751)

(8,724,261)

Non-current liabilities

 




Borrowings


(700,000)

(1,300,000)

(1,000,000)

Provisions for liabilities


(404,871)

(373,347)

(389,147)

Lease liabilities


(17,582,600)

(15,728,067)

(15,178,055)

Deferred tax liability

 

-

-

(226,292)



(18,687,471)

(17,401,414)

(16,793,494)

 





 

(29,340,945)

(24,960,165)

(25,517,755)

 





Net assets

 

1,434,315

3,983,315

3,184,879

 


 

 

 

Equity

 




Share capital

9

1,226,667

1,226,667

1,226,667

Share premium


10,050,313

10,050,313

10,050,313

Other reserves


163,130

155,105

175,640

Retained losses

 

(10,005,795)

(7,448,770)

(8,267,741)

Total equity

 

1,434,315

3,983,315

3,184,879

Consolidated statement of changes in equity

For the half-year ended 30 June 2024

 


Notes

Share capital

Share premium

Other reserves

Retained losses

Total equity

 


£

£

£

£

£

At 1 January 2024

 

1,226,667

10,050,313

175,640

(8,267,741)

3,184,879

 







Total comprehensive income

 






Loss for the period

3

-

-

-

(1,738,054)

(1,738,054)








Transactions with owners

 






Share-based payments

5

-

-

(12,510)

-

(12,510)

At 30 June 2024


1,226,667

10,050,313

163,130

(10,005,795)

1,434,315

 














At 2 January 2023

 

1,226,667

10,050,313

145,099

(6,668,310)

4,753,769

 







Total comprehensive loss

 






Loss for the period

3

-

-

-

(780,460)

(780,460)








Transactions with owners

 






Share-based payments

5

-

-

10,006

-

10,006

At 2 July 2023

 

1,226,667

10,050,313

155,105

(7,448,770)

3,983,315

 














At 2 January 2023

 

1,226,667

10,050,313

145,099

(6,668,310)

4,753,769

 







Total comprehensive income

 






Loss for the period

3

-

-

-

(1,599,431)

(1,599,431)








Transactions with owners

 






Share-based payments

5

-

-

30,541

-

30,541

At 31 December 2023

 

1,226,667

10,050,313

175,640

(8,267,741)

3,184,879

      

 



 

Consolidated statement of cash flows

For the half-year ended 30 June 2024

 

  


Notes

Half-year ended 30 June 2024

Half-year ended 2 July 2023

Period ended 31 December 2023

 


£

£

£

Operating activities

 









Cash inflow from operations

10

2,029,406

81,028

2,287,882

Interest paid


(58,550)

(67,731)

(136,551)

Interest received


76,654

-

94,146

Tax received


45,650

-

-

Net cash from operating activities

 

2,093,160

13,297

2,245,477

 





Investing activities

 









Purchase of property, plant & equipment

8

(2,212,370)

(386,701)

(1,279,900)

Net cash used in investing activities

 

(2,212,370)

(386,701)

(1,279,900)

 





Financing activities

 









Payment of lease liabilities


(1,779,507)

(1,616,051)

(3,247,143)

Bank loan repayments


(300,000)

(300,000)

(600,000)

Net cash used from financing activities

 

(2,079,507)

(1,916,051)

(3,847,143)

 





Decrease in cash and cash equivalents

 

(2,198,717)

(2,289,455)

(2,881,566)

Cash and cash equivalents at beginning of period


7,048,757

9,930,323

9,930,323






Cash and cash equivalents at end of period

 

4,850,040

7,640,868

7,048,757

 



Notes to the financial information

For the half-year ended 30 June 2024

 

1.      Basis of preparation

 

The consolidated financial information for the half-year ended 30 June 2024, has been prepared in accordance with the accounting policies the Group applied in the Company's latest annual audited financial statements for the period ended 31 December 2023. These accounting policies are based on the UK-adopted International Financial Reporting Standards ("IFRS") and International Financial Reporting Interpretation Committee ("IFRIC") interpretations. The consolidated financial information for the half-year ended 30 June 2024 has been prepared in accordance with IAS 34: 'Interim Financial Reporting', as adopted by the UK, and under the historical cost convention.

 

The financial information relating to the half-year ended 30 June 2024 is unaudited and does not constitute statutory financial statements as defined in section 434 of the Companies Act 2006. The comparative figures for the period ended 31 December 2023 have been extracted from the consolidated financial statements, on which the auditors gave an unqualified audit opinion and did not include a statement under section 498 (2) or (3) of the Companies Act 2006. The annual report and accounts for the period ended 31 December 2023 has been filed with the Registrar of Companies.

 

The Group's financial risk management objectives and policies are consistent with those disclosed in the period ended 31 December 2023 annual report and accounts.

 

The half-yearly report was approved by the board of directors on 17 September 2024. The half-yearly report is available on the Comptoir Libanais website, www.comptoirlibanais.com, and at Comptoir Group's registered office, 6th Floor, Winchester House, 259-269 Old Marylebone Road, London, NW1 5RA.

 

2.      Changes in accounting policies

 

The accounting policies adopted in the preparation of the consolidated financial information for the half-year ended 30 June 2024 are consistent with those followed in the preparation of the Group's annual consolidated financial statements for the period ended 31 December 2023.

 

At the date of authorisation of the half-yearly report, the following amendments to Standards and Interpretations issued by the IASB that are effective for an annual period that begins on or after 1 January 2024. These amendments have not had any material impact on the amounts reported for the current and prior years.

 

Standard or Interpretation                                                                                                           Effective Date

IFRS 16 - Lease Liability in a Sale and Leaseback                                                                       1 January 2024

IAS 1 - Non-current Liabilities with Covenants                                                                          1 January 2024

IAS 1 - Classification of Liabilities as Current or Non-current                                                1 January 2024

IAS 7 - Supplier Finance Arrangements                                                                                       1 January 2024

 

 

 

 

New and revised Standards and Interpretations in issue but not yet effective

 

At the date of authorisation of these financial statements, the Group has not early adopted the following amendments to Standards and Interpretations that have been issued but are not yet effective:

 

Standard or Interpretation                                                                                                           Effective Date

IAS 21 - Lack of Exchangeability                                                                                                     1 January 2025

IFRS 18 - Presentation and Disclosure in Financial Statements                                            1 January 2027

 

As yet, none of these have been endorsed for use in the UK and will not be adopted until such time as endorsement is confirmed. The directors do not expect any material impact as a result of adopting standards and amendments listed above in the financial period they become effective.

 

Critical accounting judgements and key sources of estimation uncertainty

 

The preparation of financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. The resulting accounting estimates may differ from the related actual results.

 

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

 

In the process of applying the Group's accounting policies, management has made a number of judgments and estimations of which the following are the most significant. The estimates and assumptions that have a risk of causing material adjustment to the carrying amounts of assets and liabilities within the future financial years are as follows:

 

Depreciation, useful lives and residual values of property, plant & equipment

The Directors estimate the useful lives and residual values of property, plant & equipment in order to calculate the depreciation charges. Changes in these estimates could result in changes being required to the annual depreciation charges in the statement of comprehensive incomes and the carrying values of the property, plant & equipment in the balance sheet.

 

Impairment of assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset is required, the Group makes an estimate of the asset's recoverable amount. An asset's recoverable amount is the higher of an asset's or cash-generating unit's fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets.

 

 

 

 

Critical accounting judgements and key sources of estimation uncertainty (continued)

 

Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value of money and the risks specific to the asset. Impairment losses of continuing operations are recognised in the profit or loss in those expense categories consistent with the function of the impaired asset. Please refer to note 8 for further details on impairments.

 

Leases

The Group has estimated the lease term of certain lease contracts in which they are a lessee, including whether they are reasonably certain to exercise lessee options. The incremental borrowing rate used to discount lease liabilities has also been estimated as the rate of interest that would be payable to borrow a similar about of money for a similar length of time for a similar right-of-use asset.

 

Deferred tax assets

Historically, deferred tax assets have been recognised in respect of the total unutilised tax losses within the Group. A condition of recognising this amount depended on the extent that it was probable that future taxable profits will be available. 

 

3.      Group operating loss


Half-year ended

30 June 2024

Half-year ended

2 July 2023

Period ended

31 December 2023

This is stated after (crediting)/charging:

£

£

£

Variable lease charges

289,953

347,069

624,812

Share-based payments (credit) / expense (note 5)

(12,510)

10,006

30,541

Depreciation of property, plant and equipment (note 8)

1,928,133

1,655,805

3,328,567

Exceptional legal and professional fees

103,357

23,045

101,145

Loss on disposal of fixed assets

123,479

-

8,940

Impairment of assets (note 7 & 8)

-

-

107,316

Rent concessions

-

-

(21,062)

Lease term modifications

-

-

132,786

Auditors' remuneration

-

-

110,000






Half-year ended

 30 June 2024

Half-year ended

2 July 2023

Period ended

31 December 2023

 

£

£

£

Restaurant opening costs

331,996

-

88,886

Restaurant closing costs

5,196

75,657

76,649

Dilapidations

15,723

16,493

32,835

 

352,915

92,150

198,370

     

For the initial trading period following opening of a new restaurant, the performance of that restaurant will be lower than that achieved by other, similar, mature restaurants. The difference in this performance, which is calculated by reference to gross profit margins amongst other key metrics, is quantified and included within opening costs. The breakdown of opening costs, between pre-opening costs and post-opening costs is shown above.

4.      Operating segments

 

The Group has only one operating segment: the operation of restaurants with Lebanese and Middle Eastern offering and one geographical segment (the United Kingdom). The Group's brands meet the aggregation criteria set out in paragraph 22 of IFRS 8 "Operating Segments" and as such the Group reports the business as one reportable segment. None of the Group's customers individually contribute over 10% of the total revenue.

 

5.      Share options and share-based payment charge

 

On 4 July 2018, the Group established a Company Share Option Plan ("CSOP") under which 4,890,000 share options were granted to key employees. The exercise price of all options is £0.1025 and the term to expiration is 3 years from the date of grant. All options have the same vesting conditions attached to them.

 

On 21 May 2021 under the existing CSOP, 3,245,000 share options were granted to key employees. The exercise price of all options is £0.0723 and the term to expiration is 3 years from the date of grant. All options have the same vesting conditions attached to them.

 

On 17 April 2023 under the existing CSOP, 2,900,000 share options were granted to key employees. The exercise price of all options is £0.0557 and the term to expiration is 3 years from the date of grant. All options have the same vesting conditions attached to them.

 

The total share-based payment credit for the period was £12,510 (H1 2023: £10,006 charge, 31 December 2023: £30,541 charge).

 

6.   Earnings/(loss) per share

 

The Company had 122,666,667 ordinary shares of £0.01 each in issue at 30 June 2024. The basic and diluted earnings/(loss) per share figures, is based on the weighted average number of shares in issue during the periods. The basic and diluted earnings/(loss) per share figures are set out below.

 


Half-year ended

30 June 2024

Half-year ended

2 July 2023

Period ended

31 December 2023

 

£

£

£

Loss attributable to shareholders

(1,738,054)

(780,460)

(1,599,431)





Weighted average number of shares

Number

Number

Number

For basic loss per share

122,666,667

122,666,667

122,666,667

Adjustment for options outstanding

449,740

-

267,293

For diluted loss per share

123,116,407

122,666,667

122,933,960





Earning/(loss) per share:

Pence per share

Pence per share

Pence per share

Basic (pence)




From loss for the year

(1.42)

(0.64)

(1.30)





Diluted (pence)




From loss for the year

(1.41)

(0.64)

(1.30)

6.      Earnings/(loss) per share (continued)

 

The basic and diluted earnings/(loss) per share is calculated by dividing the profit or loss attributable to ordinary shareholders by the weighted average number of shares and 'in the money' share options in issue. Share options are classified as 'in the money' if their exercise price is lower than the average share price for the period.

 

As required by 'IAS 33: Earnings per share', this calculation assumes that the proceeds receivable from the exercise of 'in the money' options would be used to purchase shares in the open market in order to reduce the number of new shares that would need to be issued. Any shares options that were not 'in the money' as at the half-year ended 30 June 2024 would be considered antidilutive and no adjustment would be made in respect of such share options.

 

7.      Intangible assets


Goodwill

Total

Cost

£

£

At 1 January 2024 and 30 June 2024

89,961

89,961

 



Accumulated amortisation and impairment

 


At 1 January 2024

(82,677)

(82,677)

Impairment during the year

-

-

At 30 June 2024

(82,677)

(82,677)

 



Net Book Value as at 30 June 2024

7,284

7,284

Net Book Value as at 2 July 2023

29,134

29,134

Net Book Value as at 31 December 2023

7,284

7,284

  

 

Intangible fixed assets consist of goodwill from the acquisition of Agushia Limited, which included the Yalla Yalla brand. Goodwill arising on business combinations is not amortised but is subject to an impairment test annually which compares the goodwill's 'value in use' to its carrying value. No impairment of goodwill was considered necessary in the current period.



 

8.      Property, plant and equipment


Right-of use assets

Leasehold land and buildings

Plant and machinery

Fixture, fittings & equipment

Motor vehicles

Total

Cost

£

£

£

£

£

£

At 1 January 2024

30,107,068

10,351,996

5,548,323

3,752,077

38,310

49,797,774

Additions

3,532,749

-

254,628

1,957,742

-

5,745,119

Disposals

-

(216,296)

(24,829)

(64,345)

-

(305,470)

At 30 June 2024

33,639,817

10,135,700

5,778,122

5,645,474

38,310

55,237,423

 







Accumulated depreciation and impairment

 






At 1 January 2024

(17,098,395)

(7,358,313)

(3,604,056)

(1,939,964)

(16,651)

(30,017,379)

Depreciation during the year

(1,284,168)

(300,001)

(174,528)

(167,147)

(2,289)

(1,928,133)

Eliminated on disposal

-

164,265

1,401

16,325

-

181,991

At 30 June 2024

(18,382,563)

(7,494,049)

(3,777,183)

(2,090,786)

(18,940)

(31,763,521)

 







Net book value

 






At 30 June 2024

15,257,254

2,641,651

2,000,939

3,554,688

19,370

23,473,902

At 2 July 2023

12,607,187

3,240,217

1,860,297

1,411,792

24,213

19,143,706

At 31 December 2023

13,008,673

2,993,683

1,944,267

1,812,113

21,659

19,780,395

     

 

At each reporting date the Group considers any indication of impairment to the carrying value of its property, plant and equipment. The assessment is based on expected future cash flows and Value-in-Use calculations are performed annually and at each reporting date and is carried out on each restaurant as these are separate 'cash generating units' (CGU). Value-in-Use was calculated as the net present value of the projected risk-adjusted post-tax cash flows plus a terminal value of the CGU. A pre-tax discount rate was applied to calculate the net present value of pre-tax cash flows. The discount rate was calculated using a market participant weighted average cost of capital. A single rate has been used for all sites as management believe the risks to be the same for all sites.

 

The recoverable amount of each CGU has been calculated with reference to its Value-in-Use. The key assumptions of this calculation are shown below:

 

Growth rate                                         3%

Discount rate                                      5.0%

Number of years projected              over life of lease

 

The value-in-use figure has been calculated using the expected annual cashflows of the Group from the latest forecasts at the time of review. In producing the forecasts, the Directors have considered the impact of current inflation levels, rising wage costs as well as the potential risk of recession.

 

The growth rate is based on a combination of industry average growth rates, actual results achieved historically and the current economic conditions. Sensitivity analysis was performed on the forecasted cashflows as well as the growth rate and only a significant reduction in cashflows would result in a material impairment charge. Therefore, based on the impairment review and sensitivity analysis carried out, an impairment charge of £nil (H1 2023: £nil, 31 December 2023: £85,466) was recorded for the period.

9.      Share capital

 

Authorised, issued and fully paid

Number of shares

 

30 June 2024

2 July 2023

31 December 2023

Brought forward

122,666,667

122,666,667

122,666,667

Issued in the period

-

-

-

 

122,666,667

122,666,667

122,666,667

 





Nominal value

 

30 June 2024

2 July 2023

31 December 2023

 

£

£

£

Brought forward

1,226,667

1,226,667

1,226,667

Issues in the period

-

-

-

 

1,226,667

1,226,667

1,226,667

  

 

 

 

10.   Cash flow from operations

 

Reconciliation of loss to cash generated from operations:

 


Half-year ended

30 June 2024

Half-year ended

2 July 2023

Period ended

31 December 2023

 

£

£

£

Operating loss for the period

(1,605,347)

(778,993)

(720,098)





Depreciation

1,928,133

1,655,805

3,328,567

Share-based payment (credit) / charge

(12,510)

10,006

30,542

Loss on disposal of fixed assets

123,479

-

8,940

Provisions

15,723

-

27,059

Lease adjustments

525,000

-

132,786

Impairment of assets

-

-

107,316

Rent concessions

-

-

(21,062)





Movements in working capital

 



Decrease / (increase) in inventories

50,306

(51,416)

(46,833)

Increase in trade and other receivables

(430,491)

(159,506)

(124,655)

Increase / (decrease) in payables and provisions

1,435,113

(594,868)

(434,680)





Cash generated from operations

2,029,406

81,028

2,287,882

  

11.   Adjusted EBITDA

 

Adjusted EBITDA was calculated from the profit/loss before taxation adding back interest, depreciation, share-based payments and non-recurring/non-cash costs incurred in relation to restaurant sites, as follows:

 


Half-year ended

30 June 2024

Half-year ended

2 July 2023

Period ended

31 December 2023

 

£

£

£

Loss after tax

(1,738,054)

(780,460)

(1,599,431)





Add back:




Finance costs

678,955

497,567

1,019,154

Finance income

(76,654)

-

(94,147)

Taxation credit

(469,594)

(496,100)

(45,674)

Depreciation

1,928,133

1,655,805

3,328,567

Impairment of assets

-

-

107,316

EBITDA

322,786

876,812

2,715,785

 




Share-based payments (credit) / charge

(12,510)

10,006

30,541

Loss on disposal of fixed assets

123,479

-

8,940

Exceptional legal and professional fees

103,357

23,045

101,145

Restaurant opening costs

331,996

-

88,886

Restaurant closing costs

5,196

75,657

76,649

Dilapidations

15,723

16,493

-

Adjusted EBITDA

890,027

1,002,013

3,021,946

  

 

 

12.   Subsequent events

 

Subsequent to the half year the Ashford Outlet Centre franchise restaurant closed.

 

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