DHAIS plc
LSE : DHAP

November 28, 2011 07:00 ET

Final Results year to 30 June 2011

                   
          
                                          DHAIS Plc ("DHAIS" or the "Company")
                                                            
                                     Final Results for the year ended 30th June 2011
        
Chairman's Statement
        
I am pleased to report our seventh year of trading as DHAIS and our third year as a PLUS listed company.
        
Retail
        
Following  a period of intense activity, we have achieved a leading position as one of the top 2 Mobility  store
operators  in the UK, and attained a significant position within the private Hearing Aid retail sector  with  13
Hearing  and Mobility stores which are predominantly in the Southern half of the UK, together with an equivalent
number of 'franchisee' or associate individuals and companies throughout much of the remainder of the UK.
        
We  end  the  year with a greater foundation of customers, goodwill, stores, and experienced personnel  together
with  strong supplier relationships. We supply hearing and health products, both inside and outside our  stores,
with  advice  and service not provided on the Internet.  Some 50% of our business is from repeat  customers  and
the remainder from specialist Grey market advertising expertise, shop windows, referrals and recommendations.
        
Marketing
        
Our  marketing  division  specialises in the Grey market and has widened its offerings  and  provides  marketing
services  to  third  parties as well as to our stores with products like stair-lifts, mobility  scooters,  solar
energy products, and more recently electric bikes and trikes; with the focus on the over 50 market.
        
Results
        
Sales  for  the  period were GBP 6,986,043 (2010: GBP 9,392,688) and we suffered a pre-tax loss of  GBP  790,430
(2010: GBP 1,524,986)
        
The loss for the current year includes the profit on the sale of our Staines store of GBP 368,380.
        
The  losses  over the last three years, which it is worth pointing out, are the only loss periods in  our  seven
years  trading, and have occurred primarily due to our rapid expansion which was geared towards taking advantage
of  opportunities to buy businesses from administrators, to obtain economies of scale and achieve a position  in
the sectors which have severe barriers to entry for newcomers.
        
This  was followed by a period of rationalisation, consolidation and restructuring in order to strike a  balance
between  economies of scale and minimising waste. The price of this process was the losses we have incurred  and
we  firmly believe that these were largely incurred as a result of the substantial merging, downsizing,  closure
of  surplus  stores, reduction in the number of offices and staff, rather than any inherent lack of  demand  for
our products.
        
That  said, we have also been affected by the severe weather in November and December of last year and of course
the wider macro-economic environment.
        
The  losses  have been funded by Directors and shareholders, illustrating our continued belief in the underlying
business, and there is no bank funding whatsoever.
        
Outlook
        
We  are pleased to say that the unaudited management accounts for the first 4 months of the new financial period
indicate operating profits on sales of some GBP 2.7million.
        
In  order to help with the interest burden, the loans from Directors and shareholders have become interest  free
as  of  1  July  2011.  The only significant remaining interest charge is on the GBP 1.3 million corporate  loan
from Widex, a major hearing aid supplier.  That is a matter for review and improvement.
        
The  Directors  cautiously  expect  continuing improvement in sales, margins and  cost  reduction  coupled  with
general  growth in our target market place to enable a profitable outcome for the first half and ultimately  the
full year to 30 June 2012.
        
Whilst  we  believe there is still opportunity for substantial growth in the Grey market place,  there  is  also
some  evidence  that  our expansion in recent times has been at the expense of traditional operators,  who  have
struggled to compete with our unique style and position of having 2 major disciplines under one roof.
        
Summary
        
The  core business model, combining Hearing aids and Mobility, was established by Tim Evans with Hearing  Health
&  Mobility  Ltd  in  2000.   We acquired his business November 2008. The original  branches  at  Kettering  and
Northampton  are  performing  stronger  than ever and the combination  with  the  Dhais  advertising  expertise,
national and local, and the expansion of the core operations to other acquired and established branches  is  now
starting  to  generate positive results. The introduction of electric bikes and trikes providing 2 and  3  wheel
electric transport to widen the choice from 4 wheel is another extension to our offering and provides access  to
a growing and specialised market place.
        
Our  objectives  are  to  consolidate,  reduce outgoings, and grow sales,  in  store  and  out  of  store,  both
organically and with opportunist dealings.
        
Thank you to all shareholders, large and small, and may I remind you that discounts of 10% are available to  all
those on the share register on our entire product range.
        
Mark Moss
Chairman
        
28 November 2011
        
Enquiries:
        
DHAIS Plc                                          029 2066 6888
Amin Kiddy, Finance Director

PLUS Advisor:                                      020 7251 3762
Alfred Henry Corporate Finance Ltd
www.alfredhenry.com
Jon Isaacs/Nick Michaels
        
The Directors accept responsibility for this announcement.
        
        
Statutory Information
        
The  financial information set out below does not constitute the Group's statutory accounts for the  year  ended
30 June 2011 but is derived from those accounts.
        
The  financial  information has been extracted from the statutory accounts of DHAIS Plc and is  presented  using
the  same  accounting policies, which have not yet been filed with the Registrar of companies, but on which  the
auditors, Williams & Co, gave an unqualified report on 28th November 2011.
        
The  Annual  Report  of  DHAIS  Plc for year ended 30 June 2011 is available upon  request  from  the  Company's
registered office at 61 Cowbridge Road East, Cardiff, CF11 9AE.
        
        
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2011
          
                                                                  30.6.11                       30.6.10
                                                           GBP             GBP            GBP             GBP
          
TURNOVER                                                             6,986,043                      9,392,688
          
Cost of sales                                                        3,382,966                      4,349,007
                                                                     ---------                      ---------

GROSS PROFIT                                                         3,603,077                      5,043,681
          
Distribution costs                                   3,883,170                      5,585,281
Administrative expenses                                666,968                        794,372
                                                     ---------       4,550,138      ---------       6,379,653
                                                                     ---------                      ---------

                                                                      (947,061)                    (1,292,482)

Other operating income                                                  53,437                         44,490
                                                                     ---------                      ---------
OPERATING LOSS                                                        (893,624)                    (1,291,482)
          
Profit on sale of store                                                368,380                              -
                                                                     ---------                      ---------

                                                                      (525,244)                    (1,291,482)
     
Interest receivable and similar income                                     946                            240
                                                                     ---------                      ---------

                                                                      (524,298)                    (1,291,242)
          
Interest payable and similar charges                                  (266,132)                      (233,744)
                                                                     ---------                      ---------
LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION                                                       (790,430)                    (1,524,986)
          
Tax on loss on ordinary activities                                      (5,199)                             -
                                                                     ---------                      ---------
LOSS FOR THE FINANCIAL YEAR FOR THE GROUP                             (785,231)                    (1,524,986)
                                                                     =========                      =========
          
Earnings per share expressed
in pence per share:
          
Basic                                                                   (1.40)                          (2.62)
          
Diluted                                                                 (1.40)                          (2.62)
                                                                                                                    
          
CONTINUING OPERATIONS
None  of  the group's activities were acquired or discontinued during the current year or  previous year.
          
TOTAL RECOGNISED GAINS AND LOSSES
The  group has no recognised gains or losses other than the losses for the current year or previous year.
          
          
CONSOLIDATED BALANCE SHEET
30 JUNE 2011
          
                                                               30.6.11                         30.6.10
                                                            GBP             GBP            GBP             GBP
FIXED ASSETS
Intangible assets                                                     1,722,390                      1,826,576
Tangible assets                                                         280,093                        515,877
                                                                      ---------                      --------- 
                                                                      2,002,483                      2,342,453
          
CURRENT ASSETS
Stocks                                                  389,995                        455,353
Debtors                                                 712,034                      1,143,480
Cash at bank and in hand                                 95,385                        229,519
                                                      ---------                      ---------                
                                                      1,197,414                      1,828,352
CREDITORS
Amounts falling due within one year                  (1,998,887)                    (2,456,528)
                                                      ---------                      ---------         

NET CURRENT LIABILITIES                                                (801,473)                      (628,176)
                                                                      ---------                      ---------
TOTAL ASSETS LESS CURRENT
LIABILITIES                                                           1,201,010                      1,714,277
          
CREDITORS
Amounts falling due after more than one                                             
year                                                                 (2,683,390)                    (2,111,426)
                                                                      ---------                      ---------
NET LIABILITIES                                                      (1,482,380)                      (397,149)
                                                                      =========                      =========
                                     
          
CAPITAL AND RESERVES
Called up share capital                                                  55,814                         56,941
Share premium                                                         1,525,186                      1,425,514
Capital redemption reserve                                                4,000                          2,545
Other reserves                                                           11,210                         11,210
Profit and loss account                                              (3,078,590)                    (1,893,359)
                                                                      ---------                      ---------
SHAREHOLDERS' FUNDS                                                  (1,482,380)                      (397,149)
                                                                      =========                      =========
         
          
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2011
          
                                                                        30.6.11                        30.6.10
                                                                            GBP                            GBP
Net cash outflow
from operating activities                                              (787,037)                      (453,664)
          
Returns on investments and
servicing of finance                                                   (209,992)                      (140,817)
          
Taxation                                                                (34,800)                        51,012

Capital expenditure                                                     378,523                       (252,489)
                                                                      ---------                      ---------
                                                                       (653,306)                      (795,958)
          
Financing                                                               519,172                        405,469
                                                                      ---------                      ---------
Decrease in cash in the period                                         (134,134)                      (390,489)
                                                                      =========                      =========
                                                    
          
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2011
          
1.    ACCOUNTING POLICIES
          
      Accounting convention
      The financial statements have been prepared under the historical cost convention and are  in
      accordance with applicable accounting standards.
          
      Basis of consolidation
      The  group financial statements consolidate the accounts of Dhais Plc and all its subsidiary
      undertakings  made  up  to  30 June 2011.  The group profit and loss  account  includes  the
      results  of  all  subsidiary undertakings.  Turnover and profits arising on trading  between
      group companies are excluded.
          
      Turnover
      Group  turnover  comprises income from two main sources.  The first represents  income  from
      the  supply  of marketing leads to various companies in the hearing and mobility industries.
      The  second  source  of income arises from the retail sale of hearing,  mobility  and  other
      related  products directly to the public.  Income is recognised when the supply of marketing
      leads  is invoiced monthly to the various customers.  On the sale of products, revenues  are
      recognised when goods have been sold over the counter or delivered to the customer.   Income
      on the sale of hearing aids is accounted for when the hearing aids have been fitted.
          
      Intangible Assets
      Goodwill,  being  the amount paid in connection with the acquisition of several  businesses,
      is  amortised evenly over its estimated useful life of twenty years, this period  reflecting
      the  position  of  the brands in the market place.  The directors carry out full  impairment
      reviews  each year on the various businesses and stores purchased.  Although the  group  has
      incurred  losses  in  recent years, the directors believe that given the rationalisation  of
      the  business  and  the  improved trading performance, goodwill  is  fairly  stated  in  the
      accounts.
          
      Tangible fixed assets
      Depreciation  is  provided at the following annual rates in order to write  off  each  asset
      over  its  estimated  useful life or, if held under a finance lease, over  the  lease  term,
      whichever is the shorter.
          
      Fixtures and fittings          -  25% on cost
      Motor vehicles                 -  25% on cost
      Computer equipment             -  25% on cost
          
      Stocks
      Stocks  are valued at the lower of cost and net realisable value, after making due allowance
      for  obsolete and slow moving items.  Stock items mainly comprise of goods for  resale.   In
      accordance  with  standard industry practice, stock is valued using the  average  historical
      cost  basis  for  each  product.  No borrowing or distribution costs  are  included  in  the
      valuation basis.
          
      Deferred tax
      Deferred  tax  arises as a result of including items of income and expenditure  in  taxation
      computations  in  periods different from those in which they are included in  the  accounts.
      Deferred tax is provided in full on timing differences which result in an obligation to  pay
      more  (or  a right to pay less) tax at a future date, at the tax rates that are expected  to
      apply when the timing differences reverse, based on current tax rates and laws.
          
      Deferred tax is not provided on timing differences arising from revaluation of fixed  assets
      where there is no commitment to sell the asset.
          
      Deferred  tax  assets are recognised to the extent that it is regarded as more  likely  than
      not that they will be recovered. Deferred tax assets and liabilities are not discounted.
          
      Foreign currencies
      Assets  and liabilities in foreign currencies are translated into sterling at the  rates  of
      exchange  ruling  at  the  balance  sheet  date.  Transactions  in  foreign  currencies  are
      translated  into  sterling  at  the rate of exchange ruling  at  the  date  of  transaction.
      Exchange differences are taken into account in arriving at the operating result.
          
      Hire purchase and leasing commitments
      Assets  obtained  under  hire purchase contracts or finance leases are  capitalised  in  the
      balance  sheet.  Those  held  under  hire  purchase contracts  are  depreciated  over  their
      estimated  useful  lives.   Those  held under finance  leases  are  depreciated  over  their
      estimated useful lives or the lease term, whichever is the shorter.
          
      The  interest  element of these obligations is charged to the profit and loss  account  over
      the relevant period. The capital element of the future payments is treated as a liability.
          
      Rentals  paid  under  operating  leases are charged to the profit  and  loss  account  on  a
      straight line basis over the period of the lease.
          
      Segmental Reporting
      The  directors have chosen not to publish details of its turnover and profit by activity  as
      required by SSAP 25.  The reason for this non disclosure is that the directors believe  that
      competitor companies could use such information to their advantage.
          
      Going Concern
      The  group accounts show a negative position and this is due to the losses suffered  by  the
      subsidiary  company, Hearing Health & Mobility Limited.  Further cut backs and consolidation
      has  ensued  with  a  view  to achieving profitability.  Cash flow projections  and  trading
      results  subsequent  to the group's year end show operating profits,  the  directors  expect
      this  to  continue going forward.  As a result, the accounts have been drawn up on  a  going
      concern basis.
          

2.    EARNINGS PER SHARE
          
      Basic  earnings  per share is calculated by dividing the earnings attributable  to  ordinary
      shareholders  by  the  weighted  average number of ordinary shares  outstanding  during  the
      period.
          
      Diluted  earnings  per  share  is calculated using the weighted  average  number  of  shares
      adjusted to assume the conversion of all dilutive potential ordinary shares.
          
      Reconciliations are set out below.
                                                                         30.6.11
                                                                         Weighted
                                                                         average
                                                                         number         Per-share
                                                            Earnings     of             amount
                                                                 GBP     shares         pence
      Basic EPS
      Earnings attributable to ordinary shareholders       (785,231)     56,223,609     (1.40)
      Effect of dilutive securities                               -               -         -
                                                            -------      ----------     ------
      Diluted EPS
      Adjusted earnings                                    (785,231)     56,223,609     (1.40)
                                                            =======      ==========     ======
                                                    
          

Contact Information

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