Key Points
● Total revenue was £125.6m (2015: £130.3m). Like for like revenue from ongoing business declined 2.8%
● Profit on ordinary activities before tax and exceptional items at £17.0m (2015: £16.9m)
● Profit before tax was £21.1m including an exceptional credit of £4.1m (2015: £16.9m with no exceptional items)
● Free cash flow was £19.6m. Net debt stood at £6.6m (representing a net debt/EBITDA ratio of 0.3 times)
● The Funkin business continues to perform ahead of expectations with revenue up 28% in the period
● Strong International performance, with revenue up 16%
● Rockstar franchise territory extension signed September 2016 - includes Russia and Italy
● Entering final stage of 3-year Fit for the Future programme with announcement of business reorganisation
● Interim dividend of 3.53p per share (2015: 3.36p), an increase of 5% on the prior year
Commenting on the results, Roger White, Chief Executive said:
"We have delivered a solid first half performance, maintaining market share, improving our operating margin with a slight improvement in our pre-exceptional profit versus the prior year. This is despite continued price deflation in the UK market, a challenging customer and consumer environment as well as poor weather in the important early summer months leading up to the end of the reporting period.
"Good progress has been made across the key areas of innovation, product reformulation, brand development and operational efficiency. We will continue to focus on these areas throughout the second half of the financial year.
"Following our significant investment in assets, infrastructure and systems, delivered through our Fit for the Future business improvement programme, we are announcing the programme's final phase, a business reorganisation which will create a faster, more efficient and leaner organisational structure.
"We are beginning to see the benefits of our product development and innovation initiatives with both consumers and customers. Market conditions remain volatile and somewhat unpredictable however, assuming a strong trading performance in the key festive period, we remain on track to deliver profit (before tax and exceptionals) slightly ahead of last year."
