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EDU HOLDINGS LIMITED — Interim / Quarterly Report 2011
Feb 24, 2011
64821_rns_2011-02-24_9e7cec87-e464-436f-94c5-fb36bc614832.pdf
Interim / Quarterly Report
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UnderCoverWear
APPENDIX 4D FOR THE HALF YEAR ENDED 31 DECEMBER 2010
1. Details of the reporting period
| Current period | 1 July 2010 to 31 December 2010 |
|---|---|
| Previous corresponding period | 1 July 2009 to 31 December 2009 |
2. Results for announcement to the market
| $ Up / down Movement % |
$ Up / down Movement % |
||
|---|---|---|---|
| 2.1 | Revenues from ordinary activities | 10,751,754 down 19.8% |
|
| 2.2 | Profit/(loss) from ordinary activities after tax attributable tomembers |
(2,647,282) down 396.6% |
|
| 2.3 | Net profit/(loss) for the period attributable to members |
(2,647,282) down 396.6% |
|
| 2.4 | Dividends | Amount per Security (cents) |
Franked amount per security (cents) |
| Current Period Final Interim |
N/A N/A |
N/A N/A |
|
| Previous corresponding period Final Interim –paid 09April 2010 |
N/A 1.25 |
N/A 1.25 |
|
| 2.5 | Record date for determining entitlements to dividends | N/A | |
| 2.6 | During the half-year ended 31 December 2010, other than disclosed in the Directors’ Report, there were no significant items that impacted on the results recorded in our Income Statement. Refer to the Directors’ Report contained in attached interim financial report for further explanation of the results. |
3. Net Tangible Assets per security
| 3. Net Tangible Assets per security | ||
|---|---|---|
| 31 Dec 2010 | 31 Dec 2009 | |
| Net tangible asset backing per ordinary security | 6.37 cents | 9.18 cents |
UnderCoverWear Limited A.B.N. 85 108 962 152 | Page 1
Appendix 4D
4. Details of entities over which control has been gained or lost during the period
| i. | Name of entity (or group of entities) over which control was gained/lost |
N/A |
|---|---|---|
| ii. | Date control was gained/lost | N/A |
| iii. | Consolidated profit (loss) from ordinary activities and extraordinary items after tax of the controlled entity (or group of entities) since the date in the current period on which control was acquired/lost Profit (loss) from ordinary activities and extraordinary items after tax of the controlled entity (or group of entities) for the whole of the previous corresponding period |
N/A N/A |
5. Details of dividends / distributions
N/A as no interim dividend will be paid.
6. Details of dividend / distribution reinvestment plan
At 31 December 2010, there was no dividend reinvestment plan in operation for UnderCoverWear Limited.
7. Details of associates and joint venture entities
N/A
8. Accounting Standards used by foreign entities
N/A
9. Qualification of audit / review
N/A as there is no audit dispute or qualification. Refer to the attached interim financial report which includes our auditor’s Independent Review Report.
UnderCoverWear Limited A.B.N. 85 108 962 152 | Page 2
UNDERCOVERWEAR LIMITED A.B.N 85 108 962 152
INTERIM FINANCIAL REPORT Half-Year Ended 31 December 2010
UNDERCOVERWEAR LIMITED A.B.N 85 108 962 152
CONTENTS
| Page | |
|---|---|
| Company Details | 3 |
| Directors’ Report | 4 |
| Consolidated Statement of Comprehensive Income | 6 |
| Consolidated Statement of Financial Performance | 7 |
| Consolidated Statement of Changes In Equity | 8 |
| Consolidated Statement of Cash Flows | 9 |
| Notes to the Interim Financial Statements | 10 |
| Directors’ Declaration | 13 |
| Auditor's Independence Declaration | 14 |
| Independent Auditor’s Review Report | 15 |
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
COMPANY DETAILS Directors Stuart Richardson, Chairman John Everett AM Richard Lowry Nick Geddes (Alternate for John Everett) Company Secretary Nick Geddes Registered & Principal UnderCoverWear Limited Office ABN 85 108 962 152 ACN 108 962 152 8 Solent Circuit Norwest Business Park Baulkham Hills NSW 2153 Tel: +61 2 8853 2800 Fax: +61 2 8853 2899 Website: www.ucw.com.au Auditor Grant Thornton Audit Pty Ltd Level 17, 383 Kent Street Sydney NSW 2000 Share Registry ComputerShare Investor Services Pty Ltd Level 5, 115 Grenfell Street Adelaide SA 5000 Stock Exchange Quotation has been granted for all the ordinary shares Listing of the company on all Member Exchanges of the Australian Stock Exchange Limited.
[ 3 ]
UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
DIRECTORS’ REPORT
Your directors submit the financial report of UnderCoverWear Limited and its controlled entities for the half-year ended 31 December 2010.
Directors
The names of directors who held office during or since the end of the half-year:
Stuart Richardson
John H Everett
Richard Lowry
Nick Geddes (Alternate for John Everett effective 6[th] August 2010)
All directors held office from the start of the half year to the date of this report unless otherwise stated.
Review of Operations
The six months of trading for UnderCoverWear for the period ended 31 December 2010 was in line with the advice to the market early December.
The net loss of $2,647,282 for the period includes goodwill impairment of $2,400,000. The impairment loss has been recognised to ensure that the value of the asset is not overstated, and has taken in consideration future earnings, expected growth, share price and the value of the goodwill in the current market.
The headline results comparing first half results for the 2011 financial year with the previous year’s first half are as follows:
Revenue $10.75m down 19.8% Loss (excluding impairment) ($0.35m) down 127.7%
Trading for the six month period has remained challenging. Issues relating to product quality, sizing consistency and product availability that occurred during the first half of the year have all been addressed.
UnderCoverWear ceased local production as from 31st December, moving to off-shore. This involved one-off restructuring costs which were expensed in the first half of 2010.
As the product range moves to 100% purchased off shore in the second half, there will be improvement to the margin in the third and fourth quarter of 2011.
Other cost saving measures including reduction in head office costs have been implemented.
The focus remains to improve sales volumes, gross margin and the bottom line.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
DIRECTORS’ REPORT
Auditor's Independence Declaration
A copy of the auditor's independence declaration in relation to the review of the interim financial report for the half year ended 31 December 2010 is shown on page 14 and forms part of this report.
This report is signed in accordance with a resolution of the board of directors.
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Stuart Richardson
Director
Dated 25th February 2011
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
| Revenue Changes in inventories and work in progress Distribution costs Commissions paid Promotions and advertising expense Depreciation and amortisation expense Impairment expense Insurance expense Employee benefits expense Rental expenses Finance costs Other expenses |
Consolidated Entity 31 December 2010 $ 31 December 2009 $ 10,751,754 13,401,225 (4,521,070) (5,641,414) (580,797) (682,525) (784,456) (972,624) (1,140,148) (1,300,231) (146,036) (73,483) (2,400,000) - (86,061) (59,416) (2,421,283) (2,288,758) (525,788) (458,276) (76,734) (19,390) (822,343) (765,705) |
|---|---|
| (Loss) / Profit before income tax expense Income tax expense |
(2,752,962) 1,139,403 105,680 (246,853) |
| (Loss) / Profit attributable to members of the parent entity Other comprehensive income |
(2,647,282) - 892,550 - |
| Total comprehensive income | (2,647,282) 892,550 |
| Basic earnings per share (cents per share) | (6.13)c 2.05c |
| Diluted earnings per share (cents per share) | (6.13)c 2.05c |
The accompanying notes form part of this financial report.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE AS AT 31 DECEMBER 2010
| CURRENT ASSETS Cash and cash equivalents Trade and other receivables Inventories Other current assets |
Consolidated Entity |
|---|---|
| 31 December 2010 $ 30 June 2010 $ 69,068 308,322 637,696 786,466 4,046,702 4,365,924 223,702 194,755 |
|
| TOTAL CURRENT ASSETS | 4,977,168 5,655,467 |
| NON-CURRENT ASSETS Plant and equipment Deferred tax assets Intangible assets |
1,149,146 1,266,021 371,248 359,178 12,217,498 14,617,499 |
| TOTAL NON-CURRENT ASSSETS | 13,737,892 16,242,698 |
| TOTAL ASSETS | 18,715,060 21,898,165 |
| CURRENT LIABILITIES Trade and other payables Interest bearing liabilities Short-term provisions |
1,001,473 1,997,734 1,608,889 454,463 640,910 1,038,660 |
| TOTAL CURRENT LIABILITIES | 3,251,272 3,490,857 |
| NON-CURRENT LIABILITIES Interest bearing liabilities Deferred tax liabilities Long-term provisions |
404,970 653,361 30,835 59,105 68,915 68,872 |
| TOTAL NON-CURRENT LIABILITIES | 494,910 791,148 |
| TOTAL LIABILITIES | 3,746,182 4,282,005 |
| NET ASSETS | 14,968,878 17,616,160 |
| EQUITY Issued capital Retained earnings |
22,809,146 22,809,146 (7,840,268) (5,192,986) |
| TOTAL EQUITY | 14,968,878 17,616,160 |
The accompanying notes form part of this financial report .
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
| Note Balance at 1 July 2009 Total comprehensive income for the period Share buy back Dividends paid or provided for 3 Balance at 31 December 2009 Balance at 1 July 2010 Total comprehensive income for the period Dividends paid or provided for 3 Balance at 31 December 2010 |
Ordinary Share Capital Retained Profits Total 23,960,750 1,595,696 25,556,446 - 892,550 892,550 |
|---|---|
| (1,062,254) - (1,062,254) - (480,000) (480,000) |
|
| 22,898,496 2,008,246 24,906,742 |
|
| 22,809,146 (5,192,986) 17,616,160 - (2,647,282) (2,647,282) |
|
| - - - |
|
| 22,809,146 (7,840,268) 14,968,878 |
The accompanying notes form part of this financial report.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
| CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Dividends & trust distributions received Finance costs Income taxes paid |
Consolidated Entity 31 December 2010 $ 31 December 2009 $ 11,971,071 15,104,978 (12,970,268) (13,970,184) 33 28,877 19 16 (76,734) - (44,035) (300,338) |
|---|---|
| Net cash provided by operating activities | (1,119,914) 863,349 |
| CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of non-current assets Purchase of non-current assets Share buy back |
2,170 (27,545) - - (1,100,679) (1,062,254) |
| Net cash used in investing activities | (25,375) (2,162,933) |
| CASH FLOWS FROM FINANCING ACTIVITIES Dividends paid Interest bearing liabilities Financing costs |
- (238,936) - (480,000) 1,107,338 (19,390) |
| Net cash provided by/(used in) financing activities | (238,936) 607,948 |
| Net decrease in cash held Cash at beginning of period |
(1,384,225) (691,636) 308,322 1,702,317 |
| Cash at end of period | (1,075,903) 1,010,681 |
The accompanying notes form part of this financial report.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
NOTE 1: BASIS OF PREPARATION
The half-year consolidated financial statements are a general purpose financial report prepared in accordance with the requirements of the Corporations Act 2001 , Accounting Standard AASB 134: Interim Financial Reporting, Australian Accounting Interpretations and other authoritative pronouncements of the Australian Accounting Standards Board. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards.
It is recommended that this financial report be read in conjunction with the annual financial report for the year ended 30 June 2010 and any public announcements made by UnderCoverWear Limited and its controlled entities during the half-year in accordance with continuous disclosure requirements arising under the Corporations Act 2001 .
The accounting policies have been consistently applied by the entities in the consolidated entity and are consistent with those applied in the 30 June 2010 financial report.
Reporting basis and conventions
The half year report has been prepared on an accruals basis and is based on historical costs.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
Consolidated Entity 31 December 2010 31 December 2009
NOTE 2: PROFIT BEFORE TAX
The following revenue and expense items are relevant in explaining the financial performance for the interim period: Revenue:
| • | sale of goods |
10,316,692 | 12,861,399 |
|---|---|---|---|
| • | distribution charges |
124,782 | 171,677 |
| • | rental revenue |
241,848 | 258,165 |
| • | other revenue |
68,381 | 81,091 |
| • | interest & dividends received |
51 | 28,893 |
| Total | Revenue | 10,751,754 | 13,401,225 |
Profit before income tax has been determined after:
| • | Expenses | Expenses | ||
|---|---|---|---|---|
| - | cost of sales | 4,271,069 | 5,641,414 | |
| - | borrowing costs | 76,734 | 19,390 | |
| - | depreciation of non-current assets | 123,465 | 73,227 | |
| - | bad & doubtful debts | 18,453 | 22,856 | |
| - | rental expense on operating leases | 524,469 | 551,115 | |
| - | impairment expense | 2,400,000 | - | |
| - | inventory write-off | 250,000 | - |
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
Consolidated Entity
31 December 2010 31 December 2009
NOTE 3: DIVIDENDS
Dividends provided for and paid during the half year are listed below:
- Dividends paid 480,000 An interim fully franked ordinary dividend will not be paid. (2009: 1.25 cent per share franked at the tax rate of 30% - 543,325
NOTE 4: BORROWINGS
The consolidated group has borrowed funds via a revolving equipment finance facility to assist with upgrading the fleet of motor vehicles. The facility is for $1,500,000, of which $868,889 has been utilised by the end of the interim reporting period.
UnderCoverWear Limited is guarantor for the amount borrowed, and the vehicles purchased are provided as security for the borrowings.
The consolidated group has an overdraft facility of $1,200,000, of which $1,161,028 has been utilised by the end of the interim reporting period.
NOTE 5: EVENTS SUBSEQUENT TO REPORTING DATE
A temporary extension of the overdraft facility to $1,850,000 was approved to 30[th] April 2011.
NOTE 6: CONTINGENT LIABILITIES
There has been no change in contingent liabilities since the last annual reporting date.
NOTE 7: SEGMENT INFORMATION
The consolidated group has identified its operating segments based on internal reports that are reviewed and used by the Board of Directors (chief decision makers) in assessing performance and determining the allocation of resources.
The group only operated in one business segment being the manufacturing and distribution of underwear and garments through the home party plan, which is supported by an administration office in Sydney, Australia. All segment assets, segment liabilities and segment results relate to the one business segment and therefore no segment analysis has been prepared.
Revenues sourced from New Zealand, the groups only export market, are deemed not to be material and therefore disclosure of assets and revenues by geographic segment is deemed not to be required.
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UNDERCOVERWEAR LIMITED A.B.N. 85 108 962 152
DIRECTORS’ DECLARATION
The directors of the company declare that:
-
The financial statements and notes, as set out on pages 6 to 12:
-
a. comply with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations; and
-
b. give a true and fair view of the consolidated entity’s financial position as at 31 December 2010 and of its performance for the half year ended on that date.
-
In the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors.
==> picture [163 x 82] intentionally omitted <==
Stuart Richardson
Director
Dated 25th February 2010
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Grant Thornton Audit Pty Ltd ACN 130 913 594
Level 17, 383 Kent Street Sydney NSW 2000 Locked Bag Q800 QVB Post Office Sydney NSW 1230
T +61 2 8297 2400 F +61 2 9299 4445 E [email protected] W www.grantthornton.com.au
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Liability limited by a scheme approved under Professional Standards Legislation
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T +61 2 8297 2400 F +61 2 9299 4445 E [email protected] W www.grantthornton.com.au
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Liability limited by a scheme approved under Professional Standards Legislation
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