15 Apr 2010 07:00
15 April 2010
STYLES & WOOD GROUP PLC
("Styles & Wood" or the "Group")
RESULTS FOR THE YEAR ENDED 31 DECEMBER 2009
Styles & Wood Group plc, a leading UK provider of property support to major retailers banks and commercial organisations, announces its preliminary results for the year ended 31 December 2009.
Financial Highlights
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| ·; Revenue of £139.3m (2008: £243.1m) ·; Underlying* profit before tax of £0.7m (2008: £0.2m) ·; Gross margin increased to 6.4% (2008: 4.3%) ·; Balance sheet significantly strengthened through capital restructure o £12.2m of new equity raised through a placing and open offer o New banking facility of £10.9m agreed o Net cash of £8.4m at 31 December 2009 (2008: net debt of £16.9m)
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| Operational Highlights ·; Group's new strategic plan "Expand Our Horizons" launched in January 2009 ·; Initiatives taken to move into new sectors including office, leisure and public sector ·; Team restructured to create three market focused teams dedicated to serving customers across our Retail, Food and Office sectors ·; Major new customers added across all business sectors ·; "Customer Journey Scorecard" launched to further improve quality and customer service ·; Group's support services proposition strengthened to enhance offering to new and existing customers ·; Phil Lanigan, Group Finance Director appointed to the PLC board and Neal Handforth, Services & Development Director appointed to the operating board of Styles & Wood Limited
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| *Before non-recurring expenditure on restructuring and refinancing and preference share accounting |
Ivan McKeever, CEO of Styles & Wood Group plc said:
"2009 was an extremely challenging year for the construction industry as a whole and inevitably the unprecedented market conditions had a significant impact on the Group's revenue. However, despite this fall in revenue we are pleased to report an improved underlying profit before tax. Following a major refinancing exercise we are pleased to have exited 2009 with a strong balance sheet and a much more efficient business, as reflected by the improved gross margin.
"We are now firmly fixed on the future. Our focus is on maintaining our margins, expanding our current offerings and diversifying into new sectors. Whilst retail will remain core to the business, we anticipate that the office fit out and refurbishment market will recover earlier than other sectors. We will therefore pursue further opportunities in this arena, as well as in leisure and the public sector, where we believe there is demand for our services.
"We believe that 2010 will be equally challenging, with tough market conditions persisting throughout the year, but we are confident that the business is well positioned to benefit both in these challenging conditions and in the upturn. We enter 2010 with an excellent customer base and a strategy that we believe will enable us to further strengthen our leading market position."
- Ends -
ENQUIRIES:
| Styles & Wood Group plc Ivan McKeever, Chief Executive Officer Philip Lanigan, Group Finance Director
| Tel 0161 926 6000 |
| Shore Capital Guy Peters/Edward Mansfield
| Tel 0207 408 4090 |
| Financial Dynamics Billy Clegg/Georgina Bonham
| Tel 0207 831 3113 |
CHAIRMAN'S STATEMENT
The past year has been a challenging one for our sector and Styles & Wood Group plc has not been immune to these extreme conditions. In the circumstances our results for the year, although disappointing, reflect the markets that we serve.
Results
Markets in 2009 were exceptionally difficult with a number of retail customers dramatically reducing their capital expenditure programmes due mainly to uncertain retail and economic conditions. This resulted in a 43% reduction in revenues which were £139.3m in the year ended 31 December 2009 compared to £243.1m in the previous year. Against this unprecedented market background, management took further action to reduce overheads and combined this with a thorough review of business processes and risk management, all of which contributed to an increase in gross margin from 4.3% in 2008 to 6.4% in 2009. Despite much lower levels of revenue, the underlying profit1before tax for the year ended 31 December 2009 was £0.7m compared with £0.2m in 2008. Costs relating to refinancing and restructuring the business amounted to £2.1m (2008: £1.2m) which along with notional Interest on preference shares of £0.4m (2008: £nil) reduced the overall result to a loss before taxation of £1.8m (2008: loss £0.9m).
Refinancing and restructuring
The capital restructure which I announced in my report last year was successfully completed on 29 June 2009 and included a new equity raising of £12.2m. At the same time £2.7m of bank debt was converted into ordinary shares, £15.0m into convertible preference shares and £5.0m into deferred ordinary shares. A new banking facility of £10.9m was agreed, made up of a £6.9m term loan and a revolving facility of £4.0m. As a result of this refinancing, our balance sheet has been considerably strengthened, and at 31 December 2009 net cash2 totalled £8.4m against net debt of £16.9m in the previous year.
In addition to this refinancing, we have continued to align our costs to lower revenue levels, reflected in the average number of colleagues within the Group which fell from 421 in 2007 to 263 in 2009. It is always recognised that changes on this scale need to be balanced with an appropriate level of continued investment in people to allow us to deliver an excellent level of service to our customers.
Strategy
In January 2009, we launched our new strategic plan "Expand Our Horizons" which aims to guide the Group over a three year period. Central to this plan is our drive to understand the changing needs of our long established retail customers so that we are there to support their expansion plans when markets return to more normal conditions. We believe we have successfully maintained relationships with key customers although many have clearly found it difficult to place orders at levels seen in previous years.
However, we need to have a more broadly based business and initiatives have already been taken to move into new sectors where our core skills, experience and innovative approach can add value. This includes the office, leisure and public services sectors and we have appointed new colleagues with experience in these markets to support the existing team.
The Group's support services proposition has been strengthened to enhance our offering to new and existing customers. There has been further investment in StoreData to create a suite of software products designed to manage a customer's property estate, and together with StorePlanning and StoreCare we will rebrand and relaunch these services in the coming months.
1 Underlying results are shown before charging non-recurring expenses relating to refinancing and restructuring and accounting for notional interest on preference shares. 2008 underlying results include material contract losses of £3.5m, there are no similar items in 2009.
2 Net cash excludes preference share capital of £7.4m accounted for as debt within non-current liabilities.
Outlook
The Group has entered 2010 with a robust balance sheet. The market conditions however continue to be unhelpful and I feel this year could prove to be as difficult as last year. We will continue to run the business in the manner of the last twelve months in order that we can achieve the best result that market conditions will allow. On a more hopeful note, some of the macro indicators seem to suggest a slowly improving situation going into 2011.
I am extremely grateful at the way that our colleagues have faced up to so many challenges over the last year. On behalf of the Board I would like to thank them for their hard work and creativity.
Jim Martin
Non executive Chairman
CHIEF EXECUTIVE'S STATEMENT
2009 Performance
2009 has been an exceptionally challenging year for the Group. The unprecedented market conditions placed significant challenges on our sector as a whole. UK construction activity in the commercial office and retail sectors fell significantly in 2009, driven by rising unemployment, lower developer-led activity and a slowdown in consumer spending. As a result, customers reduced their property investment plans and renegotiated terms in order to control costs, whilst capacity in the market placed pressure on tender prices.
These tough market conditions had an inevitable impact on the Group's 2009 revenue, which was £139.3m (2008: £243.1m). However, we were pleased that, despite much lower levels of revenue, the underlying1 profit before tax for the year increased to £0.7m (2008: £0.2m) and we also restored our gross margin to a more appropriate level.
During the year, we took action to ensure the business was well placed to weather these challenging market conditions, which we anticipate will continue through 2010. This involved a major re-financing and re-structuring exercise, which has enabled us to exit 2009 with a much more efficient business and stronger balance sheet.
The Group also made progress in the office fit out and refurbishment market as part of its strategy to diversify its customer base and broaden its sector reach.
Refinancing
During the early part of 2009 it became clear that the Group needed to strengthen its balance sheet in order to meet the challenges of a deteriorating market and to position the business for recovery. I am pleased to report that we successfully executed a significant refinancing that has transformed the Group's balance sheet. At 31 December 2008 the Group's net debt position was £16.9m. Following the refinancing, the Group moved to a net cash2 position of £8.4m at 31 December 2009, a change of some £25.3m. The renewed strength of our balance sheet leaves us with sufficient funds to take long term strategic decisions and navigate the shorter term challenging market conditions.
Improving Quality and Customer Service
During 2009, we launched our "Customer Journey Scorecard" which aims to measure delivery performance throughout the project lifecycle. Results from this measure are encouraging and indicate an improving trend in both operational delivery and customer perception.
Despite a considerable reduction in market demand and increasing competitive pressure, we are pleased to report that the Group's gross margin returned to a more appropriate level. This reflected our decision to focus on profitable opportunities, rather than solely on increasing market share. It was also the result of working more closely with our supply chain to achieve value for our customers, and "right sizing" our business early to mitigate the impact of the recession. In turn, we passed savings onto our customers to help alleviate the pressure on their capital expenditure programmes. These responsive actions give us the confidence that we can remain price competitive in the short term and further improve our margin as volumes return.
1 Underlying results are shown before charging non-recurring expenses relating to refinancing and restructuring and accounting for notional interest on preference shares. 2008 underlying results include material contract losses of £3.5m, there are no similar items in 2009.
2 Net cash excludes preference share capital of £7.4m accounted for as debt within non-current liabilities.
Divisional review
Fit out and refurbishment
During 2009 our fit out and refurbishment business (StoreFit) was engaged by a wide range of customers across a diverse range of projects. The year was characterised by a lower level of investment and smaller project values as retailers chose to refresh rather than refurbish their stores.
General Retail
In General Retail the business continued its relationship with many of the major high street brands including Boots, Argos, Homebase and M&S delivering 21 new stores and refreshing 40 existing stores. We were pleased to add Habitat and DW Fitness as new customers during the year and opened 5 new stores for these important customers. At the end of 2009 we were re-engaged by Primark to open a new store and were also commissioned by The Merlin Entertainments Group to create their first Legoland Discovery Centre in the UK at The Trafford Centre. We will continue to develop our relationships with new and existing retail brands and look to add new customers during 2010.
Food Retail
The Food Retail sector remained resilient throughout 2009 with our fit out and refurbishment business being engaged by Tesco, Waitrose, The Co-Operative, Lidl and Morrisons. During 2009 the business opened 8 new stores and refurbished a further 708 stores. A key feature of the year was the high volume of rebrand activity as food retailers acquired competitor space or improved their brand appearance.
Styles & Wood was appointed by Morrisons to rebrand 388 stores in the second half of 2008 and completed this programme during 2009. In addition, the business was engaged by The Co-Operative on the Somerfield rebrand programme. We are pleased that the business has secured its first store refurbishment project for Morrisons and has added Makro as a new customer, which will help to offset forecasted lower volumes in this sector during 2010, following the end of this rebrand activity.
Office
The Retail Banking and Office market is beginning to show positive signs of recovery after a period of turmoil and consolidation. Styles & Wood holds strong relationships with Barclays, HBOS, RBS, Lloyds and Britannia and was pleased to add Nationwide as a new customer in 2009. During the year, the business was actively engaged in both Barclays and Lloyds rebrand and new branch programmes. Banks are seeking opportunities to consolidate their property portfolio and we expect to see continued office churn and high street rebrand activity during 2010. In preparation for this the new Lloyds Banking Group created a single major framework and we were delighted that the Group was appointed as one of only four national suppliers.
During the year, we made good progress with our entry into the office fit out and refurbishment market, delivering new and refurbished space for customers including Telereal Trillium, Mapeley and BDP. In line with our strategy we will continue to focus on opportunities in this sector.
Support Services
A broad service offer continues to appeal to our major customers particularly as they push towards an outsourced model.
StorePlanning
Our Design business (StorePlanning) worked in tandem with our fit out and refurbishment business to jointly deliver projects for a number of customers including Morrisons, Lloyds and Argos. In addition, they were engaged directly by Boots, Barclays, B&Q, Nationwide, Sainsbury's and others to deliver design services.
Market contraction has impacted this business. A trend of fewer and smaller projects particularly in the retail sector curtailed revenue. However, importantly our relationships with key clients have been maintained and new customers added including Nationwide, Morrisons and Lloyds.
StoreCare
We continue to maintain our customers' stores and offices and deliver retail initiatives through our StoreCare business.
StoreCare delivered over 600 projects during 2009, with typical values ranging from £5,000 to £50,000. These high volume, low value projects are very important to our customers and require the same level of customer care and attention to detail as major projects. During the year we delivered initiatives for Asda across 306 stores and improved the quality of office space in 121 Lloyds buildings. These are two examples of how this business helps us provide a broader service offer to our customers.
StoreData
As clients seek to improve their business performance during the current economic downturn, their need for fast access to accurate property information has increased. Our StoreData business continues to satisfy this need by developing and implementing property information solutions.
During 2009 we continued to support the Tesco Property team and signed up new customers including Nationwide, The Co-operative and B&Q.
Strategy
We continue to believe in our vision of being the property services provider of choice to retail, leisure, office and public sector markets. We remain focused on our comprehensive strategic plan, "Expand Our Horizons", launched in January 2009, designed to guide the business over a three year period. The key highlights of our strategy are outlined below:
Keep then grow our Customers for Life
Premier League Retailers have been and will continue to be our core target market. They are strong businesses with strategies in place to deal with recession and recovery and we believe they will start to increase store investment as conditions improve. We have strong relationships with our retail clients and believe that we are well positioned to benefit from this investment.
Grow our Support Services businesses
Customers see us as a natural and credible source of advice on design, programme management and maintenance issues, as well as having the national coverage and scale to match their needs. We will continue to focus on developing both current and new services that support our customers' end-to-end property related needs and in the next month will rebrand and relaunch our range of support services.
Enter new sectors
Although retail will remain core to our business, we recognise that entering new sectors provides a wider reach for our business and that this diversity is important for the Group's long-term growth and stability. During the period, we therefore began to undertake initiatives to move into new markets, including the office, leisure and public sector arena and have employed experts in these markets to support the existing team. Establishing a strong foothold in these markets will be a key focus of the Group over the coming years.
Our Team
2009 has been a challenging year for our team. In the light of market conditions, we have been pro-active in reducing costs where necessary and we took some tough decisions around the structure and scale of our business.
During the year we restructured the team to create three market focused teams dedicated to serving customers across our Retail, Food and Office sectors. We are delighted that we are already seeing good results and that the restructure has enhanced customer service, improved team work and accelerated process improvement.
We recognised that continued investment in people is necessary to ensure the highest customer service standards are maintained. I am also delighted to welcome Phil Lanigan to the PLC board as Group Finance Director and Neal Handforth as Services & Development Director to the operating board of Styles & Wood Limited. We will continue to seek exceptional talent in the market place to further strengthen our team and help us deliver our strategy.
Think Green
We are acutely aware of the impact that our design and construction activities have on the environment. We work tirelessly to ensure that we minimise our impact on society and the world in which we live and work. Our Think Green campaign amplifies our core value of Being Responsible and sets out our environmental targets. In some cases, we are already achieving our ambitions, and in other areas, we have got some way to go. But in all cases, the route is set and our objectives are clear.
Focused on the Future
We have taken positive and decisive actions during 2009 to ensure that our business is well placed to face the challenges of current market conditions. We are pleased to have exited 2009 with a much more efficient business, having focused on tightly controlling our cost base and significantly improving gross margin. The full year effect of these cost savings will be realised in 2010. Following our successful refinancing and strong cash management the Group is now in a robust financial position, with a strong balance sheet and healthy net cash position to weather the tough market conditions.
Following a year dominated by refinancing and restructuring, our focus is now firmly fixed on the future. We will continue to focus on the Group's delivery of profitable work to maintain our margin. We anticipate that the office fit out and refurbishment market will recover earlier than other sectors. Therefore, in line with our strategy, whilst we will continue to focus on the retail sector, we will pursue further opportunities in this arena, as well as in leisure and the public sector, where we believe there is demand for our services. Overall, we will continue to focus on growing the business both through opportunities to expand on our current offerings, as well as diversifying into new sectors.
We believe that 2010 will be equally challenging with tough market conditions persisting throughout the year, but we are confident that the business is well positioned to benefit both in these challenging conditions and in the upturn. We enter 2010 with an excellent customer base and with a strategy that we believe will enable us to further strengthen our leading market position.
Ivan P McKeever
Chief Executive Officer
FINANCIAL REVIEW
Introduction
The difficult market conditions first experienced in 2008 continued unabated throughout 2009. We experienced reduced market demand for the Group's services, combined with a strain on the capital structure of the business due to the highly leveraged balance sheet. However, we successfully completed a refinancing exercise in the first half of 2009 which incurred significant associated costs but has enabled the Group to enter 2010 in a robust financial position.
Refinancing
The Group completed a significant refinancing on 29 June 2009. The refinancing involved:
● Raising of new money
- £10.0m of new ordinary equity raised through a placing
- £2.2m of new ordinary equity raised through an open offer
● Debt for equity swap
- conversion of £2.7m bank debt into ordinary shares
- £15.0m of bank debt converted into convertible redeemable preference shares
- issue of deferred ordinary shares in exchange for £5.0m of bank debt
● New banking facilities
- term loan of £6.9m repayable over 5 years
- revolving credit facility of £4.0m available for 5 years
Revenue and operating profit
Tough market conditions and the uncertainty over the Group's corporate position in the first half of 2009 contributed to a reduction in revenue for the year ended 31 December 2009 to £139.3m, down by 43% from £243.1m in 2008. Management have taken action to realign the cost base of the business with the reduced volumes of work. The restructuring, commencing in 2008 and continuing into 2009, reduced headcount further with average employee numbers down by 28% from 365 in 2008 to 263 for 2009. The Group undertook a review of its business processes and risk management approach in 2009 to improve its financial performance. This project is beginning to deliver benefits with underlying gross margin percentage up by 199bps on the prior year in a difficult trading environment.
The improvement in gross margin combined with the overhead reduction exercises has enabled the Group to record an underlying operating profit1 of £1.8m (2008: £1.9m) despite the 43% fall in revenue.
Underlying profit before tax2 was £0.7m (2008: £0.2m) after a share of losses on the joint venture operation of £0.3m (2008: £nil) and reflecting lower net financing costs following the refinancing of £0.8m (2008: £1.7m). Non-recurring expenditure on refinancing and restructuring of £2.1m (2008: £1.2m) and accounting for notional interest on preference shares of £0.4m (2008: £nil) reduced the result to a loss before taxation of £1.8m (2008: loss £0.9m).
1 Before non-recurring expenditure on restructuring and refinancing. 2008 results include material contract losses of £3.5m. 2 Before non-recurring expenditure on restructuring and refinancing and preference share accounting. 2008 results include material contract losses.
3 Underlying administrative expenses exclude non-recurring expenditure.
The decline in revenue was seen across all four business units as follows:
| 2009 | StoreFit | Store Planning | Store Care | Store Data | Central | Total |
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| £m | £m | £m | £m | £m | £m |
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| Revenue | 119.2 | 3.5 | 15.4 | 1.2 | - | 139.3 |
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| Underlying operating profit | 4.0 | 0.5 | 1.1 | 0.3 | (4.1) | 1.8 |
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| Underlying margin | 3.4% | 15.1% | 7.2% | 21.0% | - | 1.3% |
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| 2008 (*restated) | StoreFit | Store Planning | Store Care | Store Data | Central | Total |
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| £m | £m | £m | £m | £m | £m |
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| Revenue | 212.2 | 5.5 | 24.1 | 1.4 | - | 243.2 |
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| Underlying operating profit | 4.2 | 1.0 | 1.9 | 0.2 | (5.4) | 1.9 |
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| Underlying margin | 2.0% | 18.3% | 8.1% | 17.1% | - | 0.8% |
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* In 2009 certain administrative expenses that had previously been allocated to the StoreFit and StoreCare segments were reallocated to central. As such 2008 results have been restated accordingly. There is no impact on operating profit.
StoreFit™ is the Group's core operation, providing fit out and refurbishment services to major retailers, commercial, leisure and public sectors. The division saw revenues reduced in 2009 as major retailers curtailed their capital investment programmes. Cost has been taken out of the business with resulting in an improvement of margin in the second half of 2009 to 4.0%.
StorePlanning™ offers leading UK retailers an outsourced design service. Revenue is down 36% as retailers faced with a reduced volume of work have had lower demand.for these services.
StoreCare™ maintains properties, project manages the installation of retail trading initiatives such as revised store layouts and provides facilities management services to customers, managing planned maintenance programmes and minor works. Revenue was lower in 2009 following completion of a major energy saving programme for a large food retailer in 2008.
StoreData™ offers customers a web based property information solution to manage critical information relating to their estate. Operating profit increased on 2008 due to improved margin.
The difficult trading environment has forced the Group to examine its cost base and ensure that it is appropriate for the current market conditions. Underlying central administrative expenses3 of £4.1m (2008: £5.4m) are down 24% on 2008.
Non-recurring expenditure
The Group incurred non-recurring expenditure of £1.7m (2008: £1.2m) in the year. The costs included £0.9m (2008: £0.8m) of restructuring costs incurred in reducing the ongoing base costs of the business with average headcount reduced to 263 (2008: 365). Expenditure of £0.8m (2008: £0.1m) incurred on the refinancing was expensed through the Income Statement.
There were no other non-recurring expenses in 2009 (2008: £0.3m aborted management buyout costs).
Financing costs
Net financing costs for the year totalled £1.7m (2008: £1.7m), including £0.4m (2008: £nil) of notional interest on preference shares and £0.5m (2008: £nil) relating to write-off of debt issue costs related to banking facilities replaced as part of the refinancing exercise. Cash interest cost reduced to £0.6m (2008: £1.5m) following reduction in bank debt as part of the refinancing. The interest rate payable on term loans increased over the year from 200bps above LIBOR to 500bps above LIBOR under revised banking arrangements from 29 June 2009. The margin over LIBOR under the banking facility is linked to the Group's profitability.
Accounting for preference share capital
The refinancing included the issue of 15,000,000 convertible redeemable preference shares of £1 each. The shares carry a coupon of 3% from 1 September 2012, are redeemable in tranches from December 2013 through to December 2019 or convertible into ordinary shares at a price of 93.75p at any time between August 2012 and July 2019.
As the preference shares have a conversion option, the Group has to account for them in accordance with IAS 39 with the result that a proportion of the preference share capital is classed as debt with the remainder treated as equity. At 31 December 2009, £7,420,000 of the preference share capital was treated as non-current liabilities with the balance of £7,580,000 shown as shareholders' equity.
In addition, IAS 32 requires that notional interest payable on the debt is calculated based on a notional interest rate, not coupon rate on the preference shares. The notional interest is charged through the Income Statement. An amount corresponding to the notional interest charge is credited to reserves, ensuring that the distributable reserves and net assets of the Group are unaffected by the accounting treatment.
Taxation
The tax credit for the year amounted to £0.1m (2008: £0.5m). This represents an effective tax credit on the loss before tax of 8.2% (2008: 57.7%). The 2009 effective rate is affected by significant non-deductible expenses, relating to refinancing expenses, notional preference share interest charges and losses not recognised. The effective rate has also been impacted by adjustments in respect of prior years which increase the effective tax credit by 1.2% (2008: 44.6%).
Dividend
No dividends have been proposed in respect of the year ended 31 December 2009 (2008: 0.25p per share pre share consolidation) and it is not currently envisaged that a dividend will be proposed in the new financial year.
Loss per share
The loss per share was 4.7p (2008: 5.3p). The 2008 loss per share has been restated to reflect the 25 for 1 share consolidation which took place on 29 June 2009 and the impact of the open offer to existing shareholders.
Net cash and cash flow
The refinancing improved the financial strength of the business with net cash4 at 31 December of £8.4m (2008: net debt £16.9m). Net cash of £7.4m was used in operations in the business in 2009 (2008: net cash generated £3.4m). Of the £7.4m utilised in the business, £7.9m was consumed in the first half of 2009 as the stretched supply chain position from 31 December 2008 was unwound. The cash generated from operations of £0.5m in the second half of 2009 has been achieved through working capital management. Our supply chain is important to our financial performance and our improved working capital management has enabled us to reduce days' purchases outstanding to 78 days (2008: 87 days).
4 Net cash excludes preference share capital of £7.4m accounted for as debt within non-current liabilities.
International
The Group commenced a joint venture operation in Dubai in 2009. The share of losses included within the accounts is £0.3m (2008: £nil). The loss arises from the first few months of trading of the operation and the investment required in establishing an infrastructure to win and execute future work.
Risks and uncertainties
The Group has in place a business risk register which it continues to review and manage the risks it faces. The key risks and uncertainties are as follows:
Operating safely - Safety is our first priority. Styles & Wood works in potentially hazardous environments from large-scale fit out projects to minor works projects and the Group's health and safety performance affects employees, customers, supply chain and the public. We continue to seek to improve our safety performance and in 2009 we introduced our "Site Assessor" web based safety audit system and achieved an 8th consecutive RoSPA Gold Medal.
Marketplace - the Group is highly focused on its key markets of food retail, general retail and retail banking. Our work in the retail marketplace has the potential to suffer from a reduced allocation of work following a reduction in customer spend. We continue to pursue framework arrangements with existing and new premier league retail customers. We have also made moves to increase our penetration of other sectors, including leisure, commercial and public sector to widen our customer profile.
Profitability - the Group continues to take actions to restructure the management team and reduce its cost base to ensure alignment with level of business in the current economic climate.
Colleagues - retention and motivation of colleagues is a key challenge for a business that is undergoing a reorganisation and restructure. We have strengthened our lines of communication with colleagues to keep them abreast of the progress of the Group and to receive feedback through our Employee Focus Group.
Delivery and procurement - our reputation could suffer if we fail to deliver to customer expectations on time, cost, quality and with innovation which may lead to a potential reduction in work allocation across the Group. In 2009, we have taken the opportunity to re-examine the way we operate and have revised our processes to ensure consistent best practice across all our business units. As customers place greater demands on Styles & Wood both in respect of quality, price and payment terms, we must look in turn to the supply chain which has a significant role to play in supporting our business. We manage this risk by working closely with our supply chain to find improvements that increase the value and quality we deliver.
Philip Lanigan
Group Finance Director
Consolidated income statement
For the year ended 31 December 2009
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| Note | 2009 |
| 2008 (restated)* | ||||
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| Underlying | Non-recurring items and preference share accounting (Note 4) | Total |
| Underlying | Non-recurring items (Note 4 ) | Total |
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| £'000 | £'000 | £'000 |
| £'000 | £'000 | £'000 |
| Continuing operations |
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| Revenue | 3 | 139,290 | - | 139,290 |
| 243,148 | - | 243,148 |
| Cost of sales |
| (130,334) | - | (130,334) |
| (232,393) | (281) | (232,674) |
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| Gross profit |
| 8,956 | - | 8,956 |
| 10,755 | (281) | 10,474 |
| Administrative expenses |
| (7,108) | (1,676) | (8,784) |
| (8,845) | (896) | (9,741) |
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| Operating profit | 3 | 1,848 | (1,676) | 172 |
| 1,910 | (1,177) | 733 |
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| Finance expense |
| (886) | (874) | (1,760) |
| (1,786) | - | (1,786) |
| Finance income |
| 74 | - | 74 |
| 104 | - | 104 |
| Share of results of joint venture |
| (299) | - | (299) |
| - | - | - |
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| (Loss)/profit before taxation |
| 737 | (2,550) | (1,813) |
| 229 | (1,177) | (949) |
| Taxation | 5 | (162) | 310 | 148 |
| 269 | 279 | 548 |
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| (Loss)/profit for the year attributable to equity shareholders |
| 575 | (2,240) | (1,665) |
| 497 | (898) | (401) |
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| Basic and diluted (loss)/earnings per share expressed in pence per share | 6 | 1.6p | (6.4)p | (4.7)p |
| 6.6p | (11.9)p | (5.3)p |
|
|
|
|
|
|
|
|
|
|
| Dividends in respect of the year expressed in pence per share | 7 |
|
|
|
|
|
|
|
| - Interim dividend paid |
|
|
| - |
|
|
| 0.25p |
| - Final dividend proposed |
|
|
| - |
|
|
| - |
* Refer to note 1 for details of the reclassification of costs between cost of sales and administrative expenses. The restatement has no impact on operating profit.
Consolidated balance sheet
As at 31 December 2009
|
| Note | 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
| Non current assets |
|
|
|
|
| Intangible assets - software |
| 111 |
| 266 |
| Property, plant and equipment |
| 408 |
| 649 |
| Deferred tax asset |
| 371 |
| 243 |
|
|
|
|
|
|
|
|
| 890 |
| 1,158 |
| Current assets |
|
|
|
|
| Trade and other receivables |
| 19,838 |
| 36,392 |
| Cash and cash equivalents |
| 14,646 |
| 9,536 |
| Current tax asset |
| - |
| 62 |
|
|
|
|
|
|
|
|
| 34,484 |
| 45,990 |
| Current liabilities |
|
|
|
|
| Trade and other payables |
| (27,096) |
| (51,619) |
| Share of net liabilities of joint venture |
| (72) |
| - |
| Financial liabilities: bank borrowings |
| (761) |
| (3,784) |
| Financial liabilities: bank guaranteed loan notes |
| (218) |
| (974) |
| Current tax liabilities |
| (277) |
| - |
|
|
|
|
|
|
|
|
| (28,424) |
| (56,377) |
|
|
|
|
|
|
| Net current assets/(liabilities) |
| 6,060 |
| (10,387) |
|
|
|
|
|
|
| Total assets less current liabilities |
| 6,950 |
| (9,229) |
|
|
|
|
|
|
| Non current liabilities |
|
|
|
|
| Financial liabilities: borrowings |
| (5,302) |
| (21,705) |
| Financial liabilities: preference shares |
| (7,420) |
| - |
|
|
| (12,722) |
| (21,705) |
|
|
|
|
|
|
| Net liabilities |
| (5,772) |
| (30,934) |
|
|
|
|
|
|
| Shareholders' equity |
|
|
|
|
| Ordinary share capital |
| 20,456 |
| 645 |
| Preference share capital |
| 7,580 |
| - |
| Share premium |
| 16,300 |
| 17,339 |
| Reverse acquisition reserve |
| (66,665) |
| (66,665) |
| Retained earnings |
| 16,557 |
| 17,747 |
|
|
|
|
|
|
| Total shareholders' deficit |
| (5,772) |
| (30,934) |
|
|
|
|
|
|
Consolidated cash flow statement
For the year ended 31 December 2009
|
|
|
|
|
|
|
| Note | 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
|
|
|
|
|
|
| Cash (used in)/generated from operations | 8 | (7,382) |
| 3,422 |
| Income taxes received/(paid) |
| 361 |
| (1,871) |
|
|
|
|
|
|
| Net cash (used in)/ generated from operating activities |
| (7,021) |
| 1,551 |
|
|
|
|
|
|
| Cash flows from investing activities |
|
|
|
|
| Purchase of property, plant and equipment |
| (29) |
| (92) |
| Purchase of intangible assets - software |
| (13) |
| (79) |
| Investment in joint ventures |
| (227) |
| - |
| Amounts advanced to joint ventures |
| (72) |
| - |
| Net cash used in investing activities |
| (341) |
| (171) |
|
|
|
|
|
|
| Cash flows from financing activities |
|
|
|
|
| Interest received |
| 66 |
| 107 |
| Interest paid |
| (628) |
| (1,611) |
| Drawdown of borrowings |
| 6,900 |
| - |
| Repayment of borrowings |
| (3,339) |
| (3,000) |
| Capitalised debt issue costs |
| (807) |
| (375) |
| Other bank charges |
| (75) |
| - |
| Issue of share capital |
| 12,150 |
| - |
| Share issue costs |
| (1,039) |
| - |
| Dividends paid to equity shareholders |
| - |
| (1,774) |
|
|
|
|
|
|
| Net cash generated from /(used in) financing activities |
| 13,228 |
| (6,653) |
|
|
|
|
|
|
| Net increase/(decrease) in cash and cash equivalents |
| 5,866 |
| (5,273) |
| Cash and cash equivalents at beginning of year |
| 8,562 |
| 13,835 |
|
|
|
|
|
|
| Cash and cash equivalents at end of year |
| 14,428 |
| 8,562 |
|
|
|
|
|
|
Cash an cash equivalents excludes restricted cash of £218,000 (2008: £974,000).
Notes to the preliminary results
1. Basis of preparation
The financial information set out in this announcement does not constitute the Group's statutory accounts for the year ended 31 December 2009 or 2008. The preliminary results of Styles & Wood Group plc ("the Group") for the year ended 31 December 2009 have been extracted from audited consolidated financial statements which have not yet been delivered to the Registrar of Companies. The auditors have reported on the Group's statutory accounts for the year ended 31 December 2009. The report does not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The financial information for the year ended 31 December 2008 is derived from the statutory accounts for that year. Except as described below, the consolidated financial statements for the year ended 31 December 2009 have been prepared on the basis of the IFRS accounting policies set out in the Group's Annual Report and Financial Statements for the year ended 31 December 2008. The Group has a joint venture in Dubai which was established in 2009, providing retail property services to the local market. The consolidated financial statements incorporate the financial statements of Styles & Wood Group plc and the entities controlled by Styles & Wood Group plc (its subsidiaries), together with a share of the results, assets and liabilities of its joint venture using the equity method of accounting. From 1 January 2009 the Group changed the way it reported the employment costs of certain employees within the StoreFit and StoreCare business divisions and now records the cost of those employees within cost of sales rather than administrative expenses. As a result, comparative figures for the year ended 31 December 2008 have been restated accordingly, resulting in an increase in cost of sales of £3.4m and a corresponding decrease in administrative expenses. There is no impact on operating profit. In addition, from 1 January 2009, the Group has reported a number of administrative expenses that had previously been allocated to the StoreFit (£4.5m) and StoreCare (£0.6m) business divisions on a notional basis, as central unallocated expenses. These expenses include the cost of the senior management and central support functions. As a result, comparative figures for the year ended 31 December 2008 have been restated accordingly, resulting in an increase in unallocated administrative expenses and a decrease in administrative expenses allocated to business divisions. There is no impact on operating profit.
2. Refinancing
On 30 April 2009 the Group announced substantial refinancing which was completed on 29 June 2009. The refinancing comprised the following steps:
·; A consolidation of the Group's ordinary share capital whereby each 25 existing ordinary shares of 1p each in the share capital of the Company were consolidated into 1 new ordinary share of 25p each.
·; An increase in the authorised share capital of the Company by £39,900,000 from £1,050,000 to £40,950,000 by the creation of:
o 79,800,000 new ordinary shares, such shares ranking pari passu in all respects with the existing new ordinary shares
o 20,000,000 non voting deferred ordinary shares of 25 pence each in the capital of the Company
o 14,950,000 convertible preference shares of £1 each in the capital
·; A debt for equity swap whereby the Group's bankers swapped £22.7m of debt for
o 10,644,935 new ordinary shares with a nominal value of £2.7m
o 20,000,000 non voting deferred ordinary shares with a nominal value of £5.0m
o 15,000,000 convertible preference share with a nominal value of £15.0m
·; The issue of 40,000,000 new ordinary shares with a nominal value of £10.0m as part of a firm placing
·; The issue of 8,599,150 new ordinary shares with a nominal value of £2.15m as part of an open offer
·; The provision of a new facility by the Group's bankers, leaving the Group with a facility comprising a £6.9m term loan which is drawn in full and a £4.0m revolving credit facility which has not been drawn.
A summary of the Group's net cash/(debt) position is given in note 9.
Total fees relating to the refinancing were £2.22m of which £1.04m have been charged to the share premium account, £0.96m has been capitalised as debt issue costs and £0.07m has been charged within operating profit. Due to the nature of the conversion rights attached to the preference shares issued as part of the refinancing, these instruments have been accounted for through the separation of their liability and equity components based on their respective fair values, with the liability component initially being valued at £7.0m and the equity component initially valued at £8.0m.
3. Segmental reporting
Year ended 31 December 2009
|
| StoreFit | StorePlanning | StoreCare |
StoreData | Unallocated | Group |
|
| £'000 | £'000 | £'000 |
£'000 | £'000 | £'000 |
|
|
|
|
|
|
|
|
| Revenue | 119,221 | 3,483 | 15,364 | 1,222 | - | 139,290 |
| Underlying segment result | 4,040 | 526 | 1,113 | 257 | (4,088) | 1,848 |
| Non-recurring items (note 4) | - | - | - | - | (1,676) | (1,676) |
| Segment result | 4,040 | 526 | 1,113 | 257 | (5,764) | 172 |
| Interest expense |
|
|
|
|
| (1,760) |
| Interest income |
|
|
|
|
| 74 |
| Share of results of joint venture |
|
|
|
|
| (299) |
| Loss before taxation |
|
|
|
|
| (1,813) |
| Taxation |
|
|
|
|
| 148 |
| Loss for the year from continuing operations |
|
|
|
|
| (1,665) |
| Net loss attributable to equity shareholders |
|
|
|
|
| (1,665) |
|
|
|
|
|
|
|
|
| Segment assets | 15,478 | 1,236 | 2,257 | 258 | - | 19,229 |
| Unallocated assets | - | - | - | - | 16,145 | 16,145 |
| Total assets | 15,478 | 1,236 | 2,257 | 258 | 16,145 | 35,374 |
|
|
|
|
|
|
|
|
| Segment liabilities | (22,955) | - | (2,176) | (727) | - | (25,858) |
| Unallocated liabilities | - | - | - | - | (15,419) | (15,419) |
| Total liabilities | (22,955) | - | (2,176) | (727) | (15,419) | (41,277) |
Year ended 31 December 2008
|
| StoreFit | StorePlanning | StoreCare |
StoreData | Unallocated | Group |
|
| £'000 | £'000 | £'000 |
£'000 | £'000 | £'000 |
|
|
|
|
|
|
|
|
| Revenue | 212,185 | 5,471 | 24,142 | 1,350 | - | 243,148 |
| Underlying segment result | 4,215 | 1,003 | 1,948 | 231 | (5,486) | 1,911 |
| Non-recurring items (note 4) | (665) | (33) | (76) | (2) | (402) | (1,178) |
| Segment result | 3,550 | 970 | 1,872 | 229 | (5,888) | 733 |
| Interest expense |
|
|
|
|
| (1,786) |
| Interest income |
|
|
|
|
| 104 |
| Loss before taxation |
|
|
|
|
| (949) |
| Taxation |
|
|
|
|
| 548 |
| Loss for the year from continuing operations |
|
|
|
|
| (401) |
| Net loss attributable to equity shareholders |
|
|
|
|
| (401) |
|
|
|
|
|
|
|
|
| Segment assets | 28,380 | 2,351 | 3,695 | 347 | - | 34,773 |
| Unallocated assets | - | - | - | - | 12,375 | 12,375 |
| Total assets | 28,380 | 2,351 | 3,695 | 347 | 12,375 | 47,148 |
|
|
|
|
|
|
|
|
| Segment liabilities | (42,410) | (148) | (5,398) | (647) | - | (48,603) |
| Unallocated liabilities | - | - | - | - | (29,479) | (27,479) |
| Total liabilities | (42,410) | (148) | (5,398) | (647) | (29,479) | (78,082) |
Operating segments are reported in a manner consistent with the internal reporting to the Board of Directors which is used to assess performance and make strategic decisions.
Unallocated assets and liabilities include property, plant and equipment, software, cash and cash equivalents, interest payable, current and deferred tax liabilities and borrowings. Unallocated segment result reflects expenses relating to the Company rather than the ongoing trade of the Group and includes share option expenses, fees for professional advisers and non-executive director remuneration.
Non-recurring items disclosed in note 4. In 2008 the Group incurred material contract losses of £3,544,000, which are included in underlying results, there were no similar items in 2009.
4. Non-recurring items and preference share accounting
The Group's results include the following items:
|
| Note | 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
| Charged to gross profit |
|
|
|
|
| Redundancy and related costs | (a) | - |
| (281) |
|
|
| - |
| (281) |
| Charged to administrative items |
|
|
|
|
| Restructuring, redundancy and related costs | (a) | (850) |
| (494) |
| Professional fees - in advance of refinancing | (b) | (756) |
| (140) |
| Professional fees -refinancing | (b) | (70) |
| - |
| Expenses relating to abortive indicative offer for group | (c) | - |
| (262) |
|
|
| (1,676) |
| (896) |
|
|
|
|
|
|
| Total charged to operating profit |
| (1,676) |
| (1,177) |
|
|
|
|
|
|
| Finance costs |
|
|
|
|
| Debt issue costs written off on refinancing | (d) | (379) |
| - |
| Other bank charges | (d) | (75) |
|
|
| Notional interest on preference shares | (e) | (420) |
| - |
|
|
| (874) |
| - |
|
|
|
|
|
|
| Total non-recurring items before tax |
| (2,550) |
| (1,177) |
|
|
|
|
|
|
| Tax on non-recurring items | (f) | 310 |
| 279 |
|
|
|
|
|
|
| Total non-recurring items after tax |
| (2,240) |
| (898) |
(a) During both 2008 and 2009 the Group has undertaken programmes of redundancy. Related costs include redundancy and notice payments made to employees together with related legal fees.
(b) Professional fees incurred in the year ended 31 December 2009 in advance of refinancing include fees paid to advisers as the Company explored a number of options to strengthen its balance sheet. Fees incurred as part of the refinancing reflect fees and expenses relating to the refinancing that could not be directly attributed to the cost of debt or equity.
Professional fees in the year ended 31 December 2008 included £135,000 in respect of a business review performed by Ernst & Young on behalf of the Group's Bankers Royal Bank of Scotland plc and £5,000 of related legal fees.
(c) Costs of £262,000 in respect of the indicative offer for the Group which was withdrawn on 23 May 2008.
(d) Upon the financing the Group wrote off £379,000 in respect of capitalised debt issue costs relating the previous bank facility. Other bank charges of £75,000 were paid to the Group's bankers in respect of a covenant reset prior to the arrangement of the new facility.
(e) Due to the conversion rights attached to the preference shares International Accounting Standards require them to be accounted for by separating the liability and equity components based on their respective fair value on issue. Subsequent to issue the liability component is measured at amortised cost and a notional interest charge, which is greater than the cash coupon payable on the shares, is made to the income statement. The difference between the imputed notional interest rate and actual cash coupon is credited to the profit and loss reserve, reducing the equity component. As no cash coupon is payable in respect of the year ended 31 December 2009 the full £420,000 of notional interest has been credited back to the profit and loss reserve.
(f) Tax on non-recurring items reflects the non-deductibility of certain non-recurring costs, primarily those relating to the refinancing and also the non-recovery of tax losses which are not expected to be recovered in future years.
5. Taxation
The effective tax rates tax for the years ended 31 December 2009 (7.6%) and 31 December 2008 (57.8%) are different from the standard rate of corporation tax in the UK of 28% (28.5% blended rate for the year ended 31 December 2008). The differences are explained below.
|
|
| 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
|
|
|
|
|
|
| Loss on ordinary activities before tax |
| (1,813) |
| (949) |
| Loss on ordinary activities multiplied by rate of corporation tax in the UK (28%, 2008: 28.5%) |
| (508) |
| (270) |
| Effects of: |
|
|
|
|
| Expenses not deductible for tax purposes |
| 113 |
| 88 |
| Non cash notional interest on preference shares |
| 118 |
| - |
| Losses not recognised - UK companies |
| 66 |
| 57 |
| Adjustment in respect of foreign tax rates |
| 84 |
| - |
| Adjustments in respect of prior periods |
| (21) |
| (423) |
|
|
|
|
|
|
| Total taxation |
| (148) |
| (548) |
|
|
|
|
|
|
6. Earnings/(loss) per share
Reconciliations of the earnings and the number of shares used in the calculation are set out below:
| 2009 |
| Underlying |
| Non-recurring items and Preference share accounting |
| Total |
|
|
| £'000 |
| £'000 |
| £'000 |
| Earnings/(loss) attributable to equity holders of the Group (£'000) |
| 575 |
|
(2,240) |
| (1,665) |
|
|
|
|
|
|
|
|
| Weighted average number of shares in issue |
| 35,212,782 |
| 35,212,782 |
| 35,212,782 |
|
|
|
|
|
|
|
|
| Basic and diluted earnings/(loss) per share (pence per share) |
| 1.6 |
|
(6.4) |
| (4.7) |
|
|
|
|
|
|
|
|
| 2008 (*restated) |
| Underlying |
| Non-recurring items |
| Total |
|
|
| £'000 |
| £'000 |
| £'000 |
| Earnings/(loss) attributable to equity holders of the Group (£'000) |
| 498 |
|
(899) |
| (401) |
|
|
|
|
|
|
|
|
| Weighted average number of shares in issue |
| 7,561,078 |
| 7,561,078 |
| 7,561,078 |
|
|
|
|
|
|
|
|
| Basic and diluted earnings/(loss) per share (pence per share) |
| 6.6 |
|
(11.9) |
| (5.3) |
|
|
|
|
|
|
|
|
The weighted average number of shares in issue for the periods presented reflects the share consolidation that took place on the 29 June 2009 together with the impact of the open offer made to existing shareholders as part of the refinancing.
On 29 June 2009 the Company issued 15,000,000 convertible preference shares which are convertible into 16,000,000 ordinary shares. These shares are not currently dilutive and neither are share options that are currently in issue in the Group. Hence there is no difference between basic and diluted earnings per share (2008: no difference).
* 2008 earnings/(loss) per share figures have been restated to reflect the share consolidation and open offer within the weighted average number of shares.
7. Dividends
No interim dividend was paid during the year (2008: £161,000, 0.25p per share prior to the share consolidation). No final dividend is proposed (2008: nil, 2007 final dividend of £1,612,000, 2.50p per share, prior to share consolidation, was paid in May 2008).
8. Note to the cash flow statement
| Group |
| 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
|
|
|
|
|
|
| Loss for the year |
| (1,665) |
| (401) |
| Adjustments for: |
|
|
|
|
| Interest payable and similar charges |
| 1,760 |
| 1,786 |
| Taxation |
| (148) |
| (548) |
| Interest receivable |
| (74) |
| (104) |
| Depreciation and amortisation |
| 438 |
| 545 |
| Share option charge/(credit) |
| 55 |
| (48) |
| Share of loss of joint ventures |
| 299 |
| - |
|
|
|
|
|
|
| Operating cash flows before movement in working capital |
| 665 |
| 1,230 |
| Changes in working capital: |
|
|
|
|
| Decrease in trade and other receivables |
| 16,333 |
| 502 |
| (Decrease)/Increase in trade and other payables |
| (24,380) |
| 1,690 |
|
|
|
|
|
|
| Cash (used in)/generated from operations |
| (7,382) |
| 3,422 |
|
|
|
|
|
|
9 Net cash/(debt)
Net cash/(debt) excludes preference share capital of £7.4m that included within non-current liabilities due to the nature of the conversion rights attached to those shares.
|
|
| 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
| Net cash/(debt)comprises: |
|
|
|
|
| Term loan |
| (6,900) |
| (14,000) |
| Revolving credit facility |
| - |
| (12,000) |
| Loan notes |
| (218) |
| (974) |
| Add: |
|
|
|
|
| Unamortised issue costs |
| 837 |
| 511 |
| Cash at bank and in hand |
| 14,428 |
| 8,562 |
| Restricted cash |
| 218 |
| 974 |
| Net cash/(debt) |
| 8,365 |
| (16,927) |
|
|
|
|
|
|
|
|
| 2009 |
| 2008 |
|
|
| £'000 |
| £'000 |
| The movement in net cash/(debt) is |
|
|
|
|
| At 1 January |
| (16,927) |
| (14,858) |
| Repayment of borrowings |
| 3,339 |
| 3,000 |
| Debt for equity swap - ordinary shares |
| 2,661 |
| - |
| Debt for equity swap - deferred ordinary shares |
| 5,000 |
| - |
| Debt for equity swap - convertible preference shares |
| 15,000 |
| - |
| Drawdown of borrowings |
| (6,900) |
| - |
| Amortisation of debt issue costs |
| (630) |
| (171) |
| Payment of additional issue costs |
| 956 |
| 375 |
| Repayment of loan notes |
| 756 |
| 1,044 |
| Movement in restricted cash |
| (756) |
| (1,044) |
| Increase/(decrease) in cash and cash equivalents excluding restricted cash |
| 5,866 |
| (5,273) |
|
|
|
|
|
|
| At 31 December |
| 8,365 |
| (16,927) |
|
|
|
|
|
|
10. Related party transactions
In the year ended 31 December 2009 the Company paid fees of £37,500 (2008: £35,000) to Rickitt Mitchell & Partners Limited in respect of Paul Mitchell's services as a non executive director. The Company paid £10,000 to Rickitt Mitchell in respect of corporate finance advice (2008: £nil).
Details of the directors' remuneration and their interests in the share capital of Styles & Wood Group plc may be found in the remuneration report within the annual report and financial statements for the year ended 31 December 2009 which will be published on the website www.stylesandwood.co.uk today.
Additional disclosures
Risks and uncertainties
As with any business, risk assessment and the implementation of mitigating actions and controls are vital to the achievement of the Group's strategy. Information on the key risks and mitigating factors can be found in the 2009 annual report and financial statements that has been published on the website www.stylesandwood.co.uk today.
Statement of Directors' responsibilities
The Directors confirm that to the best of their knowledge the information set out in this announcement has been prepared in accordance with the Disclosure and Transparency Rules of the UK Financial Services Authority, International Financial Reporting Standards (IFRS) and the International Financial Reporting Interpretation Committee (IFRIC) Interpretations, as endorsed by the European Union (EU). Except as described in the basis of preparation, the accounting policies applied are consistent with those set out in the annual report and financial statements for the year ended 31 December 2008. In preparing this announcement the Directors have also made reasonable and prudent judgements and estimates. The financial information, Chairman's statement, Chief Executive's statement and the Financial Review contained herein give a true and fair view of the assets, liabilities, financial position and profit and loss of the Group.
The Directors of Styles & Wood Group plc at the date of this announcement are as set out below:
Jim Martin Non-Executive Chairman
Ivan McKeever Chief Executive Officer
Philip Lanigan Group Finance Director
Robert Hough Non-Executive Director
Paul Mitchell Non-Executive Director