Jessop interim sales for six months up to March 30th 2008

Press Release:

Jessops plc have today released reports on their interim results for the six months to 30 March 2008.

Highlights

Financial Performance

• Total sales £134.8m down 24.7% reflecting the closure of 81 stores during the period (2007: £179.0m)
• Like for like sales down 5.0% (2007: down 2.8%)
• Gross Profit Margin up by over 3 percentage points to 30.8% (2007: 27.5%)
• Operating loss before non-recurring items reduced to £2.9m (2007: Loss £6.3m – as restated)
• Loss before finance fees, non-recurring items and tax reduced to £6.1m (2007: Loss £7.9m – as restated)
• Loss before tax down to £11.2m (2007: £24.7m – as restated)
• Stock reduced to £26.8m (2007: £39.9m)
• Net bank debt at period end £54.8m (2007: £61.6m)

Banking

• Agreement in outline with HSBC for medium term finance comprising:

1) Senior debt of £49m plus necessary overdraft facilities

2) Two tranches – amortising and bullet

3) Commercial interest rates

4) Deferred finance fee converted into warrants over 10% of issued equity

Key Initiatives

• Three new store formats being trialled this year
• New partnership with CeWe to drive enhanced D&P proposition
• Supply chain improvements
• Further cost savings implemented
  
  

David Adams, Executive Chairman, said: “This has been a significant six months of progress for Jessops. We have improved gross margins, achieved a reduction in our fixed cost base, a reduction in stock levels and reached an agreement in principle with HSBC to secure longer term funding for the business."

"While the economic and retail environment remains very challenging, the business is on a sounder footing. Although like for like sales are down, our focus on profitable sales means that this is compensated for by the increase in gross margin rate. We have also put in place actions to reduce our cost base, the net effect of these points mean we now expect to make a small loss for the year before non-recurring charges and financing fees. We are also investing in our business, both in stores and in our people, and we believe that this investment should position us for growth in the future.”

For further information on Jessops please visit their website.