word
{GAP_ANONYMIZATION}
ALL
EXECUTIVE
sp
DIRECTORS
sp
OF
sp
THE
COMPANY
sp
TOGETHER
sp
WE'LL
ANSWER
ANY
sp
QUESTIONS
{OOV}
AT
THE
END
OF
THIS
sp
SHORT
sp
PRESENTATION
sp
FIRST
THE
FIGURES
sp
FURNITURE
RETAILING
CONTINUES
TO
BE
HIGHLY
sp
COMPETITIVE
sp
SO
I
AM
sp
PLEASED
TO
REPORT
THAT
TURNOVER
sp
FOR
THE
sp
TWENTY
EIGHT
WEEKS
sp
WAS
sp
THROUGH
TO
THE
sp
TWENTY
sp
MILLION
sp
FIVE
POINT
sp
FIVE
PERCENT
BETTER
THAN
THE
SAME
sp
PERIOD
IN
sp
THE
sp
PREVIOUS
sp
YEAR
sp
OPERATING
PROFIT
sp
FOR
sp
THE
PERIOD
WAS
sp
TWENTY
sp
SEVEN
sp
POINT
sp
FOUR
MILLION
sp
COMPARED
WITH
A
sp
PRO
FORMA
LEVEL
OF
sp
NINETEEN
sp
POINT
sp
FOUR
MILLION
LAST
sp
YEAR
sp
AN
sp
INCREASE
sp
OF
FORTY
ONE
sp
PER
CENT
sp
PROFIT
BEFORE
TAX
WHICH
INCLUDES
sp
NINETEEN
POINT
SIX
MILLION
sp
POUNDS
WORTH
OF
sp
PROFIT
sp
FROM
THE
SALE
OF
sp
THE
GROUP'S
sp
INVESTMENT
sp
IN
CARPET
RIGHT
sp
WAS
sp
FORTY
sp
FOUR
POINT
sp
ONE
sp
COMPARED
TO
A
LOSS
OF
sp
TWELVE
MILLION
sp
FOR
THE
SAME
sp
PERIOD
LAST
sp
YEAR
sp
AN
EXTRA
SHARE
OF
FIVE
sp
P
sp
OF
WHICH
TWO
POINT
TWO
P
RELATES
TO
THE
EXCEPTIONAL
sp
PERIOD
ON
THE
SALE
OF
CARPET
RIGHT
sp
SHARES
sp
GIVING
INTEREST
NET
EARNINGS
PER
SHARE
OF
sp
TWO
POINT
EIGHT
sp
P
sp
IN
sp
A
FEW
MOMENTS
I'D
LIKE
TO
TELL
YOU
BRIEFLY
ABOUT
sp
THE
TRADING
BACKGROUND
TO
sp
THE
FIGURES
sp
AND
TO
GIVE
YOU
AN
INDICATION
OF
HOW
sp
BUSINESS
HAS
BEEN
SINCE
THE
PERIOD
ENDED
sp
AND
sp
PARTICULARLY
SINCE
sp
OUR
sp
IMPORTANT
SALE
STARTED
ON
sp
BOXING
sp
DAY
sp
BUT
sp
FIRST
I'LL
ASK
{GAP_ANONYMIZATION}
OUR
FINANCE
DIRECTOR
sp
TO
GO
INTO
sp
THE
FIGURES
IN
A
sp
LITTLE
sp
BIT
sp
MORE
sp
DETAIL
sp
THANK
sp
YOU
{GAP_ANONYMIZATION}
GOOD
MORNING
LADIES
AND
GENTLEMEN
sp
TURNOVER
GREW
BY
sp
FIVE
sp
POINT
sp
FIVE
sp
PER
sp
CENT
sp
DURING
THE
TWENTY
EIGHT
WEEKS
THE
sp
SIXTH
OF
NOVEMBER
sp
TO
sp
THREE
HUNDRED
AND
TWENTY
sp
MILLION
sp
THERE'S
BEEN
NO
INFLATION
sp
IN
OUR
sp
SELLING
PRICES
sp
SO
ALL
OF
THIS
sp
GROWTH
sp
IS
sp
FROM
INCREASED
VOLUMES
sp
PARTICULARLY
IN
sp
UPHOLSTERY
sp
BEDS
sp
APPLIANCES
sp
AND
sp
PRONTO
sp
ALTHOUGH
THE
TOTAL
RETAIL
TRADING
AREA
sp
IS
UNCHANGED
AT
sp
THE
sp
PERIOD
END
sp
THERE
ARE
IN
sp
FACT
sp
TWO
sp
DIFFERENT
sp
UNDERLYING
ELEMENTS
sp
NEW
sp
FOOTAGE
sp
HAS
sp
BEEN
LAID
DOWN
IN
sp
FRANCE
sp
BUT
THIS
HAS
sp
BEEN
sp
OFF
sp
SET
sp
BY
A
NET
REDUCTION
sp
IN
THE
RETAIL
sp
TRADING
sp
AREA
sp
IN
THE
U
K
THE
sp
SALES
sp
PER
SQUARE
sp
FOOT
sp
WHICH
EXCLUDES
{OOV}
RETAIL
SALES
sp
AND
IS
sp
BASED
ON
THE
WAITING
AVERAGE
sp
TRADING
AREA
sp
SHOWS
AN
INCREASE
sp
OF
SEVEN
sp
POINT
sp
TWO
PERCENT
sp
A
LOW
{OOV}
MARGIN
OF
sp
FIFTY
FIVE
sp
POINT
SIX
PER
CENT
sp
WAS
DOWN
sp
FROM
sp
FIFTY
EIGHT
sp
POINT
sp
FIVE
sp
PER
CENT
sp
IN
THE
sp
SAME
PERIOD
LAST
THIS
sp
THIS
sp
WAS
sp
MAINLY
DUE
sp
TO
A
DROP
IN
IN
sp
HOUSE
sp
MANUFACTURING
sp
PARTICIPATION
sp
AND
sp
ADVERSE
EXCHANGE
sp
RATES
sp
GROSS
sp
MARGIN
sp
WAS
sp
AS
WE
EXPECTED
sp
BROADLY
LEVEL
sp
WITH
THE
SECOND
HALF
OF
LAST
YEAR
sp
THE
sp
REDUCTION
sp
AND
PAYROLL
COSTS
sp
OF
sp
FIVE
MILLION
sp
OR
sp
SIX
sp
POINT
EIGHT
PER
CENT
sp
REFLECTS
THE
STAFF
REDUCTIONS
sp
WHICH
sp
TOOK
sp
PLACE
sp
LAST
sp
YEAR
sp
THESE
ARE
EFFICIENCY
GAINS
sp
PRIMARILY
sp
IN
sp
AREAS
OF
sp
MANAGEMENT
sp
AND
sp
DISTRIBUTION
sp
AS
A
RESULT
OF
sp
TIGHT
sp
EVERY
DAY
sp
CONTROL
sp
COSTS
sp
OTHER
OPERATING
CHARGES
sp
AT
sp
SEVENTY
EIGHT
POINT
SEVEN
MILLION
sp
HAVE
sp
FALLEN
sp
AS
THE
PERCENTAGE
sp
OF
SALES
sp
BY
POINT
sp
NINE
sp
PER
CENT
sp
TO
TWENTY
sp
FOUR
sp
POINT
SIX
sp
PER
CENT
sp
AND
DEPRECIATION
sp
IN
THE
sp
PERIOD
sp
HAS
sp
FALLEN
BY
TWO
POINT
THREE
MILLION
sp
TO
EIGHT
POINT
sp
FOUR
MILLION
sp
OUR
SUB
LEASING
OF
OF
sp
SURPLUS
sp
RETAIL
AREA
HAS
sp
CONTINUED
sp
IN
THE
PERIOD
sp
AND
sp
COMBINED
WITH
A
SMALL
PROGRAMME
OF
sp
RETAIL
PARK
sp
DEVELOPMENTS
sp
WILL
ENABLE
OUR
RETAIL
AREA
sp
GROW
sp
SORRY
sp
WILL
ENABLE
OUR
RENTAL
INCOME
sp
TO
GROW
sp
INDEED
RENTAL
INCOME
WILL
BE
IN
EXCESS
sp
OF
sp
NINE
MILLION
POUNDS
sp
FOR
sp
THE
sp
FULL
YEAR
sp
COMPARED
TO
SEVEN
MILLION
sp
POUNDS
sp
FOR
LAST
sp
YEAR
sp
COMBINED
EFFECTS
sp
OF
THESE
INITIATIVES
sp
HAS
sp
RESULTED
IN
OPERATING
PROFITS
sp
RISING
sp
TO
sp
TWENTY
SEVEN
POINT
sp
FOUR
MILLION
sp
COMPARED
WITH
THE
PRO
FORMA
LEVEL
sp
OF
sp
NINETEEN
sp
POINT
sp
FOUR
MILLION
LAST
sp
YEAR
sp
WHICH
IS
AN
INCREASE
sp
OF
sp
FORTY
ONE
PER
sp
CENT
sp
OUR
NET
OPERATING
MARGINS
sp
HAVE
sp
RISEN
sp
FROM
SIX
sp
POINT
sp
FOUR
PER
CENT
sp
TO
sp
EIGHT
sp
POINT
SIX
sp
PER
CENT
sp
THERE
IS
A
NET
INTEREST
CHARGE
IN
THE
sp
PERIOD
sp
OF
sp
THREE
MILLION
sp
WHICH
IS
sp
A
DECREASE
sp
OF
TWO
POINT
sp
FOUR
MILLION
sp
ON
sp
THE
SAME
PERIOD
LAST
sp
YEAR
sp
THIS
REFLECT
THE
CASH
sp
FROM
THE
SALE
OF
sp
THE
GROUP'S
INVESTMENT
sp
IN
CARPET
RIGHT
sp
TOGETHER
WITH
sp
LOW
INTEREST
sp
RATES
sp
THE
sp
PROFIT
ON
ORDINARY
ACTIVITIES
sp
WITH
sp
MORE
TAXATION
sp
WAS
sp
FORTY
sp
FOUR
POINT
sp
ONE
MILLION
sp
COMPARED
sp
TO
A
LOSS
LAST
sp
YEAR
sp
OF
TWELVE
MILLION
sp
BUT
OF
COURSE
THESE
TWO
sp
FIGURES
sp
ARE
NOT
sp
COMPARABLE
sp
THIS
YEAR'S
NUMBER
INCLUDES
NINETEEN
POINT
SIX
MILLION
sp
PROFIT
sp
ON
THE
SALE
OF
CARPET
RIGHT
sp
AND
LAST
YEAR'S
NUMBER
sp
INCLUDES
TWENTY
FOUR
POINT
SEVEN
sp
MILLION
sp
FLOTATION
AND
BUY
OUT
COSTS
sp
A
MORE
APPROPRIATE
sp
COMPARISON
sp
IS
THE
PROFIT
sp
BEFORE
sp
TAX
sp
THIS
YEAR
OF
sp
TWENTY
sp
FOUR
POINT
sp
FIVE
MILLION
sp
COMPARED
sp
TO
A
PROFIT
BEFORE
TAX
LAST
sp
YEAR
sp
OF
sp
TWELVE
POINT
SEVEN
MILLION
sp
AN
INCREASE
OF
NINETY
sp
THREE
PER
CENT
THE
sp
FORECAST
TAX
sp
CHARGE
FOR
sp
THE
YEAR
IS
sp
THIRTY
sp
FOUR
PER
CENT
sp
WHICH
IS
BELOW
LAST
YEAR'S
sp
RATE
OF
sp
THIRTY
sp
FIVE
sp
AND
WE
sp
EXPECT
THIS
LOW
RATE
sp
TO
sp
CONTINUE
sp
IN
THE
FUTURE
sp
EARNINGS
PER
SHARE
IN
THE
PERIOD
WERE
sp
FIVE
sp
P
sp
BUT
AFTER
TAKING
INTO
ACCOUNT
EXCEPTIONAL
CARPET
sp
RIGHT
sp
GAIN
sp
THIS
IS
REDUCED
sp
TO
TWO
POINT
EIGHT
P
sp
AND
COMPARES
sp
TO
LAST
YEAR'S
sp
PRO
sp
FORMA
EARNINGS
sp
PER
sp
SHARE
sp
OF
sp
ONE
sp
POINT
sp
FOUR
MILLION
sp
WHICH
INCLUDED
LOSSES
ON
THE
sp
CLOSING
sp
DOWN
OF
OUR
OPERATIONS
sp
THE
CASH
sp
POSITION
AT
sp
THE
PERIOD
END
sp
SHOWED
NET
BORROWINGS
OF
sp
THIRTY
NINE
sp
POINT
SEVEN
MILLION
sp
WHICH
sp
COMPARES
sp
TO
sp
EIGHT
sp
TWO
POINT
SEVEN
MILLION
sp
AT
sp
THE
sp
SAME
TIME
sp
TWELVE
MONTHS
sp
AGO
sp
{OOV}
HAS
sp
FALLEN
OVER
THIS
sp
PERIOD
FROM
sp
SEVENTY
EIGHT
PER
sp
CENT
sp
TO
sp
TWENTY
EIGHT
sp
PER
sp
CENT
sp
DURING
THE
PERIOD
NET
BORROWINGS
HAVE
sp
FALLEN
BY
TWENTY
ONE
POINT
EIGHT
MILLION
sp
PRINCIPALLY
DUE
TO
sp
THE
TWENTY
ONE
POINT
sp
FOUR
MILLION
PROCEEDS
sp
FROM
sp
CARPET
RIGHT
sp
M
F
I
TRADITIONALLY
HAS
A
sp
STRONGER
SECOND
HALF
sp
CASH
sp
FLOW
sp
AND
NET
BORROWINGS
ARE
EXPECTED
TO
sp
FALL
FURTHER
IN
THE
sp
SECOND
sp
HALF
OF
THE
YEAR
sp
TWO
sp
OTHER
sp
KEY
ELEMENTS
sp
WERE
sp
WITHIN
OUR
sp
CASH
sp
FLOW
sp
FIRST
sp
STOCK
LEVELS
sp
WERE
INCREASED
sp
BY
NINE
sp
POINT
THREE
MILLION
sp
IN
sp
PREPARATION
sp
FOR
OUR
IMPORTANT
sp
WINTER
SALE
sp
SECONDLY
WE
sp
UTILISED
sp
AVAILABLE
A
C
sp
T
CAPACITY
sp
IN
THE
GROUP
sp
TO
OBTAIN
AN
EARLY
RECOVERY
sp
OF
ELEVEN
AND
A
HALF
MILLION
OF
sp
A
sp
C
sp
T
AND
sp
THIS
WOULD
NOT
NORMALLY
sp
HAVE
sp
BEEN
RECOVERED
sp
UNTIL
sp
JANUARY
sp
NINETEEN
NINETY
sp
FIVE
sp
CAPITAL
EXPENDITURE
FOR
THE
sp
PERIOD
sp
WAS
FOURTEEN
POINT
SIX
sp
MILLION
sp
AND
IS
LIKELY
TO
BE
sp
TWENTY
FIVE
MILLION
sp
FOR
THE
YEAR
sp
ALTHOUGH
sp
SIMILAR
sp
TO
LAST
sp
YEAR'S
LEVEL
OF
sp
TWENTY
THREE
MILLION
sp
YOU
REMEMBER
THAT
LAST
YEAR'S
sp
NUMBER
sp
INCLUDED
sp
THE
sp
PURCHASE
OF
sp
FOUR
sp
FREEHOLD
PROPERTIES
sp
FOR
NINE
MILLION
sp
POUNDS
sp
YOU
ALSO
KNOW
THAT
ON
PAGE
NINE
OF
OUR
INTEREST
sp
STATEMENT
sp
WE
HAVE
CREATED
A
sp
NON
DISTRIBUTABLE
sp
SPECIAL
RESERVE
sp
AGAINST
WHICH
sp
WE
ARE
WRITING
OFF
OUR
GOOD
sp
WILL
RESERVE
sp
THIS
HAS
sp
CREATED
A
CAPITAL
sp
STRUCTURE
sp
MORE
sp
SUITABLE
sp
FOR
A
LISTED
COMPANY
sp
THANK
YOU
sp
FOR
YOUR
ATTENTION
sp
I
WOULD
NOW
LIKE
TO
HAND
sp
YOU
BACK
TO
{GAP_ANONYMIZATION}
sp
THANKS
sp
AND
sp
I'LL
JUST
OUTLINE
THE
BACKGROUND
sp
TO
THE
FIGURES
THAT
sp
{GAP_ANONYMIZATION}
sp
HAS
JUST
sp
PRESENTED
sp
TO
YOU
DURING
THE
PERIOD
NEW
KITCHEN
CARCASSES
STORES
sp
WORKTOPS
sp
AND
THE
SINKS
ALL
MANUFACTURED
sp
BY
sp
HYGENA
sp
WERE
INTRODUCED
INTO
ALL
OUT
STORES
sp
ALONG
WITH
A
NUMBER
OF
IMPROVEMENTS
TO
OUR
BEDROOM
RANGES
sp
THIS
WILL
WAS
COMPLETED
IN
TIME
sp
FOR
THE
SALE
PERIOD
WHICH
BEGAN
ON
sp
BOXING
sp
DAY
WE
OPENED
A
NEW
STORE
IN
CHRIST
CHRISTCHURCH
AND
sp
REBUILT
OUR
NORTH
SHIELDS
SITE
REPLACING
THE
M
sp
F
I
STORE
sp
WITH
sp
A
COMPLETELY
NEW
ONE
sp
TWO
MORE
STORES
WILL
OPEN
IN
CARDIFF
AND
YEOVIL
AT
sp
THE
END
OF
NEXT
MONTH
sp
BRINGING
THE
TOTAL
NUMBER
OF
U
K
STORES
TO
ONE
HUNDRED
AND
SEVENTY
EIGHT
sp
THESE
TWO
STORES
WILL
TRADE
UNDER
THE
NAME
OF
sp
HOMEWORKS
sp
AND
sp
WILL
OPERATE
AS
A
TESTING
GROUND
FOR
M
F
I'S
MAINSTREAM
BUSINESS
sp
THEY'VE
BEEN
DEVELOPED
AFTER
CONSIDERABLE
CONSUMER
RESEARCH
sp
AND
WILL
EVALUATE
NEW
PRODUCTS
AND
NEW
SERVICE
IDEAS
WHICH
sp
IF
FOUND
ACCEPTABLE
sp
WILL
BE
TAKEN
UP
sp
BY
THE
M
sp
F
sp
I
CHAIN
sp
WE'VE
CONTINUED
OUR
PROGRAMME
OF
IMPROVEMENTS
TO
THE
M
F
I
STORE
DESIGN
sp
LAYOUT
AND
sp
PRESENTATION
sp
SEVEN
MORE
STORES
HAVE
BEEN
sp
COMPLETELY
REFITTED
sp
AND
A
sp
FURTHER
sp
EIGHTY
FOUR
THOUSAND
SQUARE
sp
FEET
OF
SURPLUS
SPACE
HAS
BEEN
SUB
LEASED
TO
OTHER
sp
RETAILERS
sp
INCREASING
OUR
RENTAL
INCOME
BY
ANOTHER
HALF
sp
A
MILLION
sp
POUNDS
sp
A
NEW
GENERATION
OF
{OOV}
A
SELL
SYSTEM
HAS
BEEN
SUCCESSFULLY
INTRODUCED
INTO
sp
ALL
OUR
STORES
WHICH
INTEGRATES
sp
WHICH
INTEGRATES
MORE
CLOSELY
sp
THE
RETAILING
DISTRIBUTION
sp
AND
MANUFACTURING
SYSTEMS
sp
AND
sp
RAISES
THE
LEVEL
OF
MANAGEMENT
INFORMATION
AND
sp
CONTROL
sp
OUR
NEW
CUSTOMER
TRACKING
SYSTEM
sp
IS
sp
GIVING
US
DETAILED
INFORMATION
ON
sp
CUSTOMER
sp
TRACKING
sp
FLOWS
sp
AND
sp
PURCHASING
BANDS
sp
AND
AS
A
RESULT
WE'RE
REFINING
STAFF
WORKING
ARRANGEMENTS
IN
ALL
STORES
sp
WITH
A
CLEAR
OBJECTIVE
sp
OF
INCREASING
SALES
sp
AND
sp
IMPROVING
sp
CUSTOMER
SERVICE
sp
THESE
TWO
IMPORTANT
OPERATIONAL
DEVELOPMENTS
sp
ARE
NOW
ALLOWING
OUR
STAFF
TO
MAKE
sp
MORE
PRODUCTIVE
USE
OF
THEIR
TIME
sp
ENABLING
THEM
TO
sp
CONCENTRATE
MORE
EFFECTIVELY
sp
ON
SERVING
CUSTOMERS
AND
sp
SELLING
sp
PRODUCTS
I
sp
AM
DELIGHTED
TO
ANNOUNCE
THAT
WE
WILL
SOON
MANUFACTURING
OVENS
AT
OUR
HYGENA
FACTORY
IN
STOCKTON
sp
EXTENDING
THE
sp
RANGE
OF
PRODUCTS
MANUFACTURED
sp
IN
sp
HOUSE
sp
FOLLOWS
ON
NATURALLY
AS
sp
M
F
sp
I'S
sp
POSITION
AS
THE
LEADING
sp
AH
RETAILER
OF
BUILT
IN
KITCHEN
APPLIANCES
sp
THESE
NEW
APPLIANCES
WILL
REPLACE
PRODUCTS
IMPORTED
FROM
EUROPE
sp
AND
WILL
RETAILED
IN
OUR
STORES
FROM
SPRING
NINETEEN
NINETY
sp
FIVE
sp
FINALLY
I
HAVE
TO
sp
REPORT
THAT
SALES
IN
FRANCE
sp
HAVE
INCREASED
BY
THIRTY
PER
CENT
sp
WITH
LIKE
FOR
LIKE
PERFORMANCE
OF
SIX
PER
CENT
ON
THE
SAME
sp
PERIOD
LAST
sp
YEAR
sp
WE
NOW
TRADE
FROM
FORTY
EIGHT
LOCATIONS
IN
sp
FRANCE
sp
WITH
THREE
MORE
STORES
DUE
TO
OPEN
sp
IN
sp
THE
SECOND
sp
HALF
OF
sp
THE
FINANCIAL
YEAR
sp
TO
ENSURE
THAT
EVERYBODY'S
sp
KEPT
INFORMED
OF
OUR
sp
PERFORMANCE
AT
sp
REGULAR
INTERVALS
THROUGHOUT
THE
YEAR
sp
WE
WILL
IN
sp
FUTURE
ANNOUNCE
OUR
INTERIM
RESULTS
IN
DECEMBER
sp
MAKE
A
STATEMENT
IN
FEBRUARY
ON
THE
WINTER
SALE
PERFORMANCE
sp
ANNOUNCE
FINAL
RESULTS
IN
EARLY
sp
JULY
sp
AND
GIVE
ANOTHER
TRADING
STATEMENT
AT
OUR
A
G
M
IN
sp
SEPTEMBER
sp
TODAY
TODAY
WE'RE
DECLARING
AN
INTERIM
DIVIDEND
OF
ONE
sp
POINT
sp
THREE
THREE
PER
SHARE
sp
ER
sp
COMPARED
WITH
THE
SAME
PERIOD
THIS
YEAR
ER
SORRY
LET
sp
ME
START
sp
THAT
AGAIN
sp
TODAY
WE'RE
DECLARING
AN
INTERIM
DIVIDEND
OF
sp
ONE
POINT
THREE
THREE
PER
SHARE
COMPARED
WITH
ONE
POINT
sp
TWO
FIVE
sp
FOR
THE
SAME
PERIOD
LAST
YEAR
sp
THIS
DECISION
sp
TAKES
INTO
sp
ACCOUNT
THE
NEED
TO
REBUILD
DIVIDEND
COVER
sp
WHILST
ENSURING
THAT
HIGHER
EARNINGS
sp
ARE
REFLECTED
sp
IN
INCREASED
INCOME
TO
sp
SHARE
HOLDERS
sp
JUST
EXCUSE
sp
ME
sp
ONE
MINUTE
sp
{LG}
sp
CURRENT
sp
TRADING
sp
TRADING
IN
THE
SECOND
sp
HAS
SHOWN
A
sp
CLEAR
IMPROVEMENT
sp
AND
SINCE
BOXING
sp
DAY
SALES
sp
OF
FOURTEEN
PER
sp
CENT
AHEAD
sp
OF
THE
PREVIOUS
YEAR
sp
IN
PARTICULAR
SALES
OF
sp
KITCHENS
sp
AND
BEDROOMS
HAVE
SHOWN
sp
CONSIDERABLE
INCREASES
sp
AND
WHILST
WE'RE
PLEASED
WITH
THE
RESPONSE
TO
OUR
NEW
PRODUCTS
sp
WE
REMAIN
sp
CAUTIOUS
ON
sp
THE
OUTLOOK
sp
FOR
sp
CONSUMER
EXPENDITURE
sp
NOW
sp
LADIES
AND
GENTLEMEN
sp
IF
sp
YOU
HAVE
sp
ANY
sp
QUESTIONS
sp
WE'LL
BE
HAPPY
TO
ANSWER
sp
THEM
sp
FOR
sp
YOU
sp
CAN
YOU
JUST
sp
WAIT
FOR
THE
MICROPHONE
BECAUSE
sp
THE
GUYS
AT
sp
THE
BACK
CAN'T
HEAR
sp
THE
QUESTION
sp
RIGHT
ERM
sp
{GAP_ANONYMIZATION}
COULD
sp
YOU
YOU
sp
SAID
THAT
YOUR
sp
PAYROLL
sp
COSTS
sp
HAD
sp
COME
sp
DOWN
sp
BY
sp
FIVE
sp
MILLION
sp
THAT'S
{OOV}
FIGURE
sp
IS
sp
IT
sp
YEAH
sp
ERM
sp
SORRY
{OOV}
HAVE
YOU
GOT
sp
THE
sp
FIGURES
THERE
{GAP_ANONYMIZATION}
YEAH
THE
sp
PAYROLL
sp
COSTS
sp
FOR
sp
THE
FIRST
HALF
OF
LAST
YEAR
WERE
SEVENTY
sp
THREE
sp
POINT
EIGHT
MILLION
sp
THE
sp
PAYROLL
sp
COSTS
FOR
sp
THE
FIRST
HALF
sp
OF
THE
REVIEW
WERE
SIXTY
EIGHT
sp
POINT
EIGHT
sp
RIGHT
sp
SO
IT'S
{OOV}
sp
FOR
sp
THE
sp
HALF
sp
YEAR
SORRY
sp
BEG
sp
YOUR
sp
PARDON
FIVE
MILLION
{OOV}
HALF
YEAR
THAT'S
CORRECT
sp
YES
FINE
OKAY
sp
AND
sp
HOW
MANY
EMPLOYEES
sp
DO
YOU
sp
NOW
sp
HAVE
sp
SIX
THOUSAND
sp
SIX
THOUSAND
SEVEN
sp
THE
AVERAGE
NUMBER
IS
sp
A
SIX
sp
THOUSAND
SEVEN
HUNDRED
sp
AND
sp
SEVENTY
sp
FOUR
IT'S
sp
ACTUALLY
ERM
sp
FINANCIAL
sp
HIGHLIGHTS
AND
sp
I'LL
JUST
CHECK
GIVE
sp
YOU
THE
EXACT
sp
FIGURE
sp
SIX
SEVEN
SEVEN
sp
FOUR
sp
RIGHT
THAT'S
sp
A
HEADCOUNT
sp
THAT'S
sp
NOT
sp
{OOV}
IT
IS
FOR
{OOV}
EQUIPMENT
sp
THAT'S
sp
{OOV}
EQUIPMENT
RIGHT
sp
AND
HOW'S
sp
THAT
COMPARED
WITH
sp
THE
PREVIOUS
sp
PERIOD
sp
LAST
YEAR
sp
WELL
THE
YEAR
sp
WE
HAD
SEVEN
sp
THOUSAND
sp
FIVE
HUNDRED
sp
AND
SEVENTY
sp
NINE
sp
SORRY
COULD
sp
YOU
REPEAT
THAT
sp
AGAIN
PLEASE
SEVEN
THOUSAND
sp
FIVE
HUNDRED
AND
sp
SEVENTY
sp
NINE
sp
AND
AT
sp
THE
sp
SAME
sp
PERIOD
sp
LAST
sp
YEAR
sp
WHICH
IS
NOVEMBER
NINETEEN
sp
NINETY
sp
TWO
sp
WE
HAVE
SEVEN
sp
THOUSAND
sp
EIGHT
HUNDRED
AND
sp
FORTY
sp
THREE
sp
RIGHT
ERM
COULD
sp
I
sp
JUST
sp
CHECK
sp
SOMETHING
sp
ELSE
sp
WHICH
sp
WAS
NOT
sp
MENTIONED
ER
IS
sp
THAT
IS
IT
WHEN
sp
YOU
HAVE
OPENED
sp
THESE
TWO
sp
HOMEWORKS
sp
SHOPS
sp
THAT
YOU'LL
BE
sp
UP
sp
TO
sp
A
HUNDRED
AND
sp
SEVENTY
EIGHT
sp
YES
THAT'S
sp
{OOV}
AND
I
WAS
WONDERING
IF
sp
YOU
sp
COULD
TELL
US
A
sp
BIT
sp
MORE
ABOUT
sp
THESE
sp
HOMEWORK
HOW
sp
THEY
sp
FIT
{OOV}
THE
M
sp
F
I
{OOV}
sp
THE
sp
PLAN
OF
sp
SHOPPING
WELL
THE
REASON
THAT
WE'VE
sp
CHANGED
THE
NAME
ON
THOSE
TWO
STORES
sp
IS
THAT
ANY
EXPERIMENTS
sp
WE
WANT
TO
CONDUCT
sp
HAVE
GOT
TO
BE
CONDUCTED
sp
OUTSIDE
THE
sp
NORMAL
M
F
I
sp
PROMOTIONAL
sp
PLATFORM
sp
AND
AS
sp
WE
sp
USE
THE
sp
NATIONAL
PRESS
EXTENSIVELY
sp
THE
ONLY
WAY
TO
DO
THAT
sp
IS
TO
CHANGE
sp
THE
NAME
sp
WE
sp
HAD
A
sp
LONG
SERIES
sp
OF
sp
VARIOUS
sp
PIECES
OF
sp
RESEARCH
ONE
sp
OF
WHICH
WAS
sp
ACTUALLY
sp
TALK
TO
ENORMOUS
AMOUNT
sp
OF
sp
CUSTOMERS
sp
THROUGH
sp
CUSTOMER
{OOV}
AND
AS
A
CONSEQUENCE
OF
THAT
WE'VE
sp
WE
sp
DECIDED
TO
sp
FORM
sp
A
sp
FAIRLY
{OOV}
BUSINESS
sp
TO
sp
PRODUCE
sp
A
sp
VERY
DIFFERENT
sp
PAIR
OF
STORES
sp
DIFFERENT
IN
THAT
sp
THEY
sp
WON'T
TRADE
IN
THE
TRADITIONAL
WAY
THAT
sp
M
F
IS
GONE
sp
AH
THEY'LL
sp
CARRY
DIFFERENT
MERCHANDISE
sp
DIFFERENT
PRICE
sp
LINES
sp
NOW
WHAT
IT
IS
ACTUALLY
sp
IS
A
sp
{OOV}
IDEA
THAT
sp
PART
OF
OUR
RESEARCH
AND
DEVELOPMENT
sp
ACTUALLY
ENGAGES
sp
THE
sp
CUSTOMER
SO
THAT
IN
sp
THE
{OOV}
STORES
IT'S
sp
VERY
sp
DIFFICULT
TO
EXPERIMENT
IN
sp
SAY
HALF
A
DOZEN
sp
WHEN
sp
THE
NATIONAL
sp
PRESS
sp
IS
sp
OUT
THERE
EVERY
WEEK
sp
MAKING
AN
OFFER
sp
THAT
sp
YOU
DON'T
sp
CARRY
{OOV}
BY
DEFINITION
{OOV}
sp
LIKE
sp
THAT
{OOV}
sp
SO
WHAT
BITS
sp
ARE
MORE
UP
MARKET
sp
MORE
DOWN
sp
MARKET
sp
{GAP_ANONYMIZATION}
WHAT
WOULD
YOU
SAY
ABOUT
THAT
WHAT
sp
WE'RE
ACTUALLY
sp
DOING
sp
IN
sp
TERMS
OF
THE
sp
PRODUCT
sp
IS
sp
WE'RE
ACTUALLY
WIDENING
sp
THE
FRANCHISE
sp
ERM
sp
I
DON'T
LIKE
TO
sp
USE
sp
WORDS
sp
GOING
sp
UP
sp
MARKET
sp
THAT
SUGGESTS
sp
THAT
WE'RE
LEAVING
OUR
CORE
sp
CUSTOMERS
sp
BEHIND
sp
WE
WILL
sp
WE
WILL
sp
ADD
ANY
sp
PRODUCT
sp
THAT
IS
sp
COMPLIMENTARY
sp
TO
OUR
sp
CORE
sp
KITCHENS
sp
BUT
ER
sp
WE'LL
STILL
sp
BE
sp
THE
MAIN
STANCE
sp
OF
sp
THE
PRODUCT
sp
IN
THESE
TWO
STORES
sp
FOR
INSTANCE
sp
WE'RE
sp
GOING
TO
INTRODUCE
sp
A
sp
HOUSE
WEAR
sp
DEPARTMENT
sp
IT
IS
SOMETHING
sp
THAT
sp
WE'VE
sp
BEEN
sp
EXPERIMENTING
sp
WITH
sp
BEFORE
WE'RE
sp
GOING
TO
sp
ERM
sp
USE
sp
THE
OPPORTUNITY
TO
sp
WIDEN
sp
THE
sp
FRANCHISE
ON
sp
APPLIANCES
sp
WE'RE
sp
GOING
sp
TO
ERM
sp
USE
sp
THE
sp
AN
EXPERIMENT
sp
ON
sp
ERM
sp
FLOORINGS
sp
TO
MATCH
sp
WORK
TOPS
THOSE
sp
KIND
sp
OF
sp
DEVELOPMENTS
sp
JUST
sp
TO
sp
TEST
sp
TO
SEE
WHETHER
sp
THE
CUSTOMER
REACTION
sp
IS
sp
AS
GOOD
AS
sp
WE
HOPED
IT
sp
WOULD
sp
BE
SO
THAT
WE
sp
CAN
THEN
INTRODUCE
IT
IN
THE
sp
MAIN
CHAIN
sp
DO
THEY
HAVE
sp
TO
sp
BE
A
sp
LOT
sp
BIGGER
sp
THESE
STORES
NO
THEY'RE
JUST
sp
TWO
STANDARD
STORES
ONE'S
sp
TWENTY
sp
FIVE
THOUSAND
SQUARE
sp
FEET
IN
sp
YEOVIL
sp
WHICH
sp
AS
YOU
sp
WILL
sp
BE
AWARE
IS
A
MARKET
sp
TOWN
sp
WITH
A
sp
FAIRLY
sp
WIDE
sp
CATCHMENT
AREA
sp
AND
IN
CARDIFF
sp
WHICH
sp
WHERE
WE'RE
OPPOSITE
MARKS
AND
SPENCERS
sp
ON
AN
OUT
sp
OF
TOWN
DEVELOPMENT
sp
SO
THEY'RE
JUST
sp
TWO
STORES
sp
VIRTUALLY
PICKED
BECAUSE
THEY
sp
WERE
READY
TO
OPEN
sp
RIGHT
sp
MY
sp
FINAL
sp
QUESTION
sp
HAVE
YOU
TALKED
sp
TO
ERM
DO
IT
ALL
ABOUT
sp
BUYING
IN
sp
IN
sp
THEIR
OUTFIT
sp
WE'VE
sp
CERTAINLY
TALKED
sp
TO
sp
DO
sp
IT
ALL
sp
{OOV}
HA
sp
HA
ERM
sp
YES
sp
THAT'S
sp
DEFINITE
YES
THANK
sp
YOU
sp
CAN
YOU
TELL
US
A
sp
BIT
sp
MORE
ABOUT
sp
THIS
{OOV}
WELL
IT'S
sp
A
sp
BOTH
A
sp
FORTUNATE
AND
UNFORTUNATE
CIRCUMSTANCE
sp
AS
A
RESULT
OF
sp
THE
sp
BY
OUT
A
sp
SORRY
{CG}
sp
AS
A
RESULT
sp
OF
THE
sp
FLOATATION
sp
WE
CUT
A
GREAT
MANY
sp
COSTS
sp
WHICH
sp
REDUCED
OUR
sp
TAXABLE
PROFITS
sp
BUT
AT
THE
SAME
TIME
WE
DID
ACTUALLY
sp
PAY
SOME
DIVIDES
AND
WE'VE
ALSO
sp
PAY
SOME
sp
DIVIDENDS
sp
HERE
sp
IN
LAST
sp
YEAR
ANYWAY
sp
THE
COMPLICATION
HAS
sp
BEEN
THAT
BECAUSE
LAST
YEAR'S
TRADING
PROFITS
sp
WERE
LOWER
THAN
EXPECTED
sp
WE
DIDN'T
sp
HAVE
sp
ANY
sp
TAXABLE
PROFITS
AGAINST
sp
WHICH
sp
TO
CLAIM
sp
BACK
THIS
A
C
T
sp
SO
sp
AS
sp
THIS
sp
WOULD
BE
sp
THE
FIRST
YEAR
IN
WHICH
sp
TAXABLE
sp
PROFITS
sp
WOULD
ARISE
sp
UNLESS
sp
WE'D
sp
NOT
BEEN
UNLESS
WE'D
BEEN
ABLE
TO
sp
FIND
SOME
OTHER
WAY
OF
DEALING
WITH
IT
sp
THE
sp
A
C
T
WHICH
sp
WE
PAY
WOULD
NOT
HAVE
BEEN
RECOVERABLE
sp
TILL
sp
JANUARY
NINETY
sp
FIVE
sp
WHAT
WE
HAVE
sp
DONE
IS
sp
WE
sp
HAVE
ERM
sp
BEEN
ABLE
TO
UTILISE
sp
SOME
A
C
T
sp
CAPACITY
sp
OR
sp
GENERATE
SOME
A
C
sp
T
sp
CAPACITY
WITHIN
ONE
OF
THE
SUBSIDIARIES
WITHIN
THE
GROUP
sp
UM
sp
THE
REASON
sp
FOR
HIGHLIGHTING
sp
IT
sp
HIGHLIGHTING
IT
IS
NOT
PARTICULARLY
sp
TO
MAKE
sp
A
sp
SONG
AND
DANCE
ABOUT
IT
sp
BUT
IS
sp
PARTICULARLY
TO
SAY
THAT
ON
THE
sp
CASH
sp
FLOW
STATEMENT
sp
THERE
IS
sp
THIS
sp
IN
sp
FLOOD
AND
IT
IS
A
ONE
OFF
sp
IN
sp
FLOOD
WE'RE
NOT
sp
GOING
TO
BE
SEEING
THAT
sp
BEING
sp
BROUGHT
sp
FORWARD
EVERY
YEAR
sp
BUT
sp
BASICALLY
WHAT
IT
IS
IS
WE
sp
HAVE
sp
PROFITS
sp
IN
sp
PREVIOUS
sp
ELEMENTS
sp
OF
sp
THE
sp
GROUP
sp
WHICH
ENABLED
sp
US
TO
sp
GENERATE
A
C
sp
T
sp
CAPACITY
sp
ENABLED
sp
US
TO
OFF
sp
SET
THIS
sp
A
C
sp
T
WHICH
WE
sp
PAID
sp
ON
sp
DIVIDENDS
sp
AND
sp
BRINGING
sp
FORWARD
EARLIER
THAN
sp
WE
WOULD
OTHERWISE
HAVE
sp
DONE
OH
sp
RIGHT
sp
CONVERSELY
HAD
WE
HAD
THE
PROFITS
LAST
sp
YEAR
sp
WHICH
WOULD
HAVE
GENERATED
sp
TAXABLE
sp
PROFITS
sp
THEN
WE
WOULDN'T
HAVE
NEEDED
sp
TO
HAVE
DONE
sp
THAT
sp
SO
THAT'S
ONE
REASON
sp
WHY
IT
WAS
sp
NOT
sp
DISCLOSED
sp
ON
sp
FLOATATIONS
AT
sp
THE
TIME
AND
sp
FLOATATION
sp
WAS
NOT
sp
REGARDED
sp
AS
AN
ASSET
IT'S
sp
NOT
AN
ASSET
UNLESS
sp
YOU
CAN
USE
IT
sp
RIGHT
sp
IF
YOU
CAN
SHOW
sp
US
sp
ERM
sp
A
sp
MAIN
sp
STREAM
sp
CORPORATION
{OOV}
LAST
sp
YEAR
{OOV}
YES
sp
BUT
NOT
sp
AGAIN
sp
NOT
sp
ONE
sp
WHICH
WE'RE
NOT
ABLE
TO
OFF
SET
THIS
sp
PARTICULAR
sp
PAYMENT
sp
I'M
sp
NOT
SURE
YOU'VE
sp
MADE
IT
ANY
CLEARER
THAN
IT
WAS
sp
BEFORE
sp
BUT
ERM
WELL
DON'T
sp
LOOK
sp
AT
ME
sp
I
sp
CAN'T
sp
HELP
YA
HOW
sp
DO
YOU
FEEL
sp
ABOUT
sp
THE
ERM
{OOV}
sp
DEAL
sp
AND
sp
A
{OOV}
I
THINK
sp
A
I
sp
THINK
sp
THAT
sp
A
sp
REGIONAL
HIGH
STREET
OUTLET
sp
WILL
PROVIDE
sp
A
THREAT
TO
sp
US
sp
CERTAINLY
AND
sp
IT'S
NOT
CLEAR
YET
sp
WHICH
WAY
THEY'RE
GON
NA
TRY
THAT
BUSINESS
BUT
YES
sp
WE
sp
ARE
sp
WORKING
AT
IT
VERY
HARD
sp
{GAP_ANONYMIZATION}
sp
IF
THE
ERM
sp
HOMEWORKS
sp
EXPERIMENT
sp
IS
SUCCESSFUL
sp
COULD
WE
SEE
sp
MANY
MORE
STORES
sp
TURNING
sp
OVER
TO
sp
THAT
sp
THAT
FORMAT
sp
AND
THAT
sp
THAT
{OOV}
OR
WILL
YOU
CONSIDER
CONVERTING
THE
sp
WHOLE
CHAIN
sp
OR
sp
MIGHT
sp
YOU
JUST
HAVE
A
SEPARATE
CHAIN
CALLED
sp
HOMESWORKS
sp
NO
I
DON'T
THINK
EITHER
sp
ERM
sp
THE
WHOLE
EMPHASIS
sp
OF
sp
HOMEWORKS
IS
TO
LEARN
sp
THINGS
sp
THERE
WHICH
WE
CAN
THEN
BOLT
ON
sp
TO
THE
MAIN
CHAIN
sp
I'LL
BE
ABSOLUTELY
AMAZED
IF
sp
IN
sp
FACT
sp
HOMEWORKS
MANAGES
TO
sp
DRIVE
sp
ANYWHERE
NEAR
THE
AMOUNT
OF
CUSTOMERS
THROUGH
IT
sp
THAT
M
F
sp
I
DOES
sp
OR
THE
PROBLEM
WE
HAD
IN
sp
YEOVIL
IS
sp
BECAUSE
IT
IS
A
VERY
RURAL
AREA
A
IS
sp
NOT
HAVING
THE
M
F
I
NAME
ABOVE
THE
DOOR
sp
SO
sp
NO
THAT
IS
NOT
THE
INTENTION
sp
I
DO
BELIEVE
HOWEVER
WE'LL
LEARN
THINGS
FROM
IT
THAT
sp
WE
sp
CAN
sp
QUICKLY
ADAPT
sp
AND
PUT
sp
INTO
THE
HUNDRED
sp
AND
SEVENTY
SIX
M
F
I
STORES
sp
HOW
BIG
sp
{OOV}
sp
SALES
sp
IN
sp
FRANCE
AND
sp
{OOV}
HOW
BIG
sp
ARE
THE
SALES
IN
sp
FRANCE
sp
AND
sp
HOW
DO
sp
MARGINS
COMPARE
sp
WITH
THE
sp
U
K
sp
WELL
sp
THE
TOTAL
sp
SALES
IN
sp
FRANCE
sp
FOR
THIS
YEAR
sp
WILL
BE
AROUND
sp
TWENTY
sp
FIVE
sp
MILLION
sp
POUNDS
sp
FOR
THE
WHOLE
YEAR
FOR
sp
THE
WHOLE
YEAR
sp
SO
IT'S
A
VERY
SMALL
sp
BUSINESS
THE
STORES
{CG}
ARE
MUCH
SMALLER
THAN
THEY
ARE
IN
sp
THE
U
K
sp
ERM
sp
AS
sp
REGARDS
sp
YOUR
sp
LAST
sp
POINT
sp
ABOUT
MARGINS
THE
MARGINS
sp
ARE
sp
ERM
AT
LEAST
EQUAL
sp
TO
THE
sp
MARGINS
sp
THAT
sp
WE
ACHIEVE
IN
sp
THE
U
sp
K
IS
sp
THAT
sp
{OOV}
sp
OH
sp
SORRY
ERM
sp
WE
ARE
EXPECT
THE
BUSINESS
sp
THIS
YEAR
TO
BREAK
EVEN
sp
IT
BROKE
EVEN
LAST
sp
YEAR
sp
ERM
sp
AND
THE
REASON
sp
FOR
THAT
sp
IS
sp
THAT
sp
WE
sp
HAVE
EXPANDED
sp
BUSINESS
VERY
RAPIDLY
sp
LAST
YEAR
WE
HAD
ONLY
sp
THIRTY
sp
FIVE
sp
STORES
sp
THIS
YEAR
WE'LL
sp
HAVE
sp
FIFTY
AND
sp
WE
sp
WILL
sp
PROBABLY
HAVE
A
sp
SIMILAR
SORT
OF
EXPANSION
sp
PROGRAMME
sp
FOR
NEXT
sp
YEAR
sp
THE
COST
OF
THAT
LEVEL
OF
sp
EXPANSION
sp
AH
sp
WERE
sp
LARGELY
sp
WRITTEN
sp
OFF
sp
AGAINST
REVENUE
sp
OR
A
LARGE
sp
PART
OF
sp
{OOV}
AGAINST
sp
REVENUE
sp
WITH
THE
EFFECT
THAT
sp
REDUCES
THE
sp
BUSINESS
TO
BREAK
sp
EVEN
sp
WHAT
sp
WHAT
PROPORTION
OF
THE
FOURTEEN
PER
CENT
SALES
sp
RISE
SINCE
AH
sp
CHRISTMAS
sp
RELATES
DIRECTLY
TO
sp
TO
MARK
DOWNS
IN
sp
THAT
sp
PERIOD
AFTER
sp
BOXING
DAY
WHEN
YOU
sp
RE
sp
OPENED
sp
NONE
IN
sp
THE
CONVENTIONAL
SENSE
THAT
I
TAKE
IT
THAT
YOU
MEAN
MARK
DOWN
sp
YOU
MEAN
sp
CLEARING
MERCHANDISE
YEAH
sp
YES
sp
DISCOUNTING
MERCHANDISE
IS
SOMETHING
WE
DO
ALL
sp
THE
TIME
sp
IT'S
JUST
sp
THAT
THE
DISCOUNTS
ARE
sp
DIFFERENT
IN
JANUARY
sp
AND
THE
MERCHANDISE
sp
TO
WHICH
THEY'RE
sp
APPLIED
sp
MAY
BE
DIFFERENT
sp
WE
DON'T
HAVE
A
{OOV}
IN
OUR
BUSINESS
AS
MANY
OTHER
RETAILERS
sp
DO
sp
WHERE
FOR
INSTANCE
sp
AFTER
sp
CHRISTMAS
{OOV}
MAY
BE
{OOV}
AND
sp
OTHER
sp
SUCH
sp
THINGS
TO
sp
CLEAR
sp
WE
DON'T
HAVE
THAT
sp
SO
THERE
ISN'T
ANY
MERCHANDISE
sp
THAT'S
BEEN
SOLD
SINCE
sp
CHRISTMAS
sp
THAT
HAS
BEEN
SOLD
BECAUSE
sp
WE
DON'T
WANT
IT
TO
sp
BE
IN
THE
INVENTORY
sp
POST
YEAR
sp
END
IT'S
sp
IT'S
JUST
sp
GENERATING
TRADE
BY
sp
BEING
DISCOUNT
sp
PRICE
sp
LEFT
sp
{OOV}
SO
sp
THEREFORE
sp
TO
A
CERTAIN
AMOUNT
YOUR
QUESTION
sp
WOULD
BE
HAS
sp
THE
{OOV}
POST
CHRISTMAS
AND
IT
sp
WAS
sp
PRE
CHRISTMAS
sp
NO
MATERIAL
DIFFERENCE
sp
WE'RE
VERY
SATISFIED
WITH
THE
sp
GROSS
sp
MARGINS
SINCE
sp
CHRISTMAS
sp
WE
HAVEN'T
HAD
TO
TAKE
ANY
EXTRAORDINARY
sp
MEASURES
sp
TO
GENERATE
THIS
ERM
sp
THIS
LEVEL
OF
SALES
INCREASE
sp
THAT'S
sp
BEING
ACHIEVED
sp
AT
sp
CONSTANT
sp
MARGIN
sp
{OOV}
A
FLAT
sp
MARGIN
sp
I
THINK
THE
AH
sp
JUST
TO
REMIND
YOU
sp
WHAT
sp
WE
HAVE
ALWAYS
SAID
IS
sp
THAT
sp
{OOV}
THAT
WOULD
IMPROVE
OUR
GROSS
MARGIN
SITUATION
WOULD
sp
BE
A
CHANGE
IN
{OOV}
sp
IN
HOUSE
MANUFACTURING
sp
GOODS
sp
AND
sp
WHILST
IT'S
A
BIT
EARLY
TO
sp
TELL
sp
WE
sp
ARE
ACTUALLY
SAYING
TO
YOU
sp
THAT
sp
THE
sp
SALES
sp
POST
sp
BOXING
sp
DAY
HAVE
sp
BEEN
IN
sp
ADDITION
sp
WHAT
sp
PROPORTION
sp
OF
sp
{OOV}
IS
NOW
MADE
IN
sp
HOUSE
sp
IT'S
MORE
THAN
SIXTY
PER
CENT
sp
AND
EIGHT
FIVE
PER
CENT
IS
sp
MADE
IN
sp
THE
U
sp
K
JUST
ABOUT
sp
ALMOST
sp
{OOV}
sp
AS
A
sp
MATTER
sp
OF
INTEREST
THAT'S
ACTUALLY
sp
WOULD
BE
HIGHER
THAN
ANY
OTHER
RETAILER
IN
sp
BRITAIN
sp
ACTUALLY
{OOV}
THAT'S
sp
NOT
sp
COMMONLY
KNOWN
{OOV}
sp
NO
OTHER
RETAILER
{OOV}
WHO
sp
HAS
sp
A
PENETRATION
OF
sp
WHATEVER
HE
SELLS
AS
sp
HIGH
sp
AS
sp
M
F
sp
I
sp
DOES
sp
{OOV}
{GAP_ANONYMIZATION}
sp
COULD
YOU
JUST
REPEAT
THE
sp
FIGURES
FOR
sp
CAPITAL
EXPENDITURE
I
sp
THINK
YOU
SAID
THAT
sp
THIS
YEAR
WAS
GOING
sp
TO
BE
HIGHER
THAN
LAST
sp
YEAR
sp
AND
EXPLAIN
sp
EXPLAIN
sp
WHERE
THE
sp
{OOV}
MONEY
GON
NA
BE
sp
INVESTED
sp
WELL
THIS
sp
YEAR'S
sp
CAPITAL
EXPENDITURE
sp
WILL
BE
AROUND
TWENTY
FIVE
sp
MILLION
AND
sp
LAST
YEAR'S
sp
FIGURE
WAS
TWENTY
THREE
MILLION
THE
sp
POINT
I
WAS
sp
MAKING
IN
THE
SPEECH
WAS
sp
THAT
sp
TWENTY
sp
THREE
MILLION
INCLUDED
NINE
sp
MILLION
POUNDS
sp
FOR
THE
sp
WE
sp
MUST
sp
HAVE
SOME
sp
STATIC
sp
IN
OUR
sp
{OOV}
NINE
MILLION
sp
POUNDS
sp
FOR
THE
PURCHASE
OF
FREEHOLDS
sp
ERM
sp
BUT
sp
THE
sp
CAPITAL
EXPENDITURE
sp
THIS
YEAR
IS
sp
SPREAD
sp
RIGHT
ACROSS
THE
OPERATION
sp
{OOV}
sp
INCLUDES
INTRODUCTION
sp
OF
ERM
RE
FITS
sp
IN
A
NUMBER
sp
OF
sp
STORES
sp
INCLUDES
sp
EXPANSION
IN
sp
FRANCE
sp
INVESTMENT
sp
IN
sp
SYSTEMS
AND
sp
HARDWARE
sp
AND
INDEED
ALSO
sp
INCLUDES
sp
AH
ABOUT
FIVE
sp
MILLION
sp
POUNDS
FOR
A
sp
RETAIL
sp
PARK
sp
DEVELOPMENT
sp
WHICH
I
ALSO
sp
REFERRED
sp
TO
sp
THE
sp
PARK
sp
DEVELOPMENT
ON
WHICH
sp
WE
HAVE
AN
INTEREST
sp
IN
sp
THE
SENSE
THAT
WE
ARE
DEVELOPING
sp
AN
M
F
sp
I
STORE
sp
AND
sp
OF
sp
COURSE
IF
sp
YOU
WANT
sp
TO
INCLUDE
A
SMALL
ELEMENT
sp
THIS
YEAR
sp
A
sp
GREATER
sp
ELEMENT
WOULD
BE
sp
{OOV}
FOR
THE
NEW
OPEN
sp
PLAN
sp
JUST
sp
A
sp
COUPLE
OF
DETAIL
POINTS
sp
ERM
sp
WHY
HAVE
YOU
SEEN
A
FALL
IN
YOUR
sp
DEPRECIATION
sp
CHARGE
AND
sp
AN
sp
INCREASE
sp
IN
sp
{OOV}
sp
RIGHT
I'LL
DEAL
WITH
sp
WITH
sp
DEPRECIATION
sp
DEPRECIATION
'S
sp
BEEN
sp
FALLING
sp
NOW
sp
FOR
TWO
OR
sp
THREE
YEARS
AS
sp
OUR
sp
CAPITAL
EXPENDITURE
sp
OF
DEPRECIABLE
ASSETS
sp
HAS
sp
BEEN
sp
FALLING
sp
INDEED
sp
IF
sp
YOU
LOOK
sp
AT
sp
LAST
YEAR'S
sp
NET
sp
OF
sp
THE
NINE
MILLION
sp
POUNDS
sp
PURCHASE
sp
OF
sp
THE
sp
FREEHOLD
sp
TO
{OOV}
FOURTEEN
MILLION
sp
THE
YEAR
BEFORE
WAS
ONLY
SIXTEEN
MILLION
sp
ERM
sp
SO
sp
AS
THE
AS
sp
THE
sp
DEPRECIATION
sp
AS
sp
THE
CAPITAL
EXPENDITURE
sp
FALLS
sp
THE
DEPRECIATION
sp
WILL
ALSO
FALL
sp
THAT'S
ONE
sp
REASON
sp
THE
OTHER
REASON
WAS
IN
THE
LATE
EIGHTIES
sp
AND
sp
EARLY
NINETIES
sp
WE
HAD
sp
A
sp
VERY
LARGE
sp
EXPENDITURE
sp
PROGRAMME
sp
INDEED
IN
ONE
YEAR
AMOUNTING
TO
sp
ONE
HUNDRED
sp
MILLION
sp
POUNDS
NOW
{OOV}
OF
THAT
sp
ARE
sp
NOW
BECOMING
sp
FULLY
sp
DEPRECIATED
sp
AND
sp
FALLING
OUT
sp
OF
sp
THE
sp
CHARGE
sp
WHAT
AH
sp
CAPITAL
EXPENDITURE
ON
NON
DEPRECIABLE
ASSETS
{OOV}
ERM
sp
FREEHOLD
PARKS
sp
AS
I
SAID
LAST
YEAR
WE
BOUGHT
sp
NINE
MILLION
POUNDS
sp
WORTH
sp
OF
sp
FREEHOLD
NOW
{OOV}
TENDED
TO
DEPRECIATE
WITH
ALL
THIS
sp
NOT
sp
FREEHOLD
LAND
sp
FREEHOLD
BUILDINGS
WE'VE
BEEN
DEPRECIATING
NOW
sp
FOR
MANY
MANY
YEARS
sp
SO
YOU
KNOW
WE'VE
ACTUALLY
sp
BEEN
DOING
THAT
sp
IS
NOT
sp
NEW
AS
sp
FAR
sp
AS
sp
WE'RE
sp
CONCERNED
sp
OKAY
{OOV}
NO
PARTICULAR
REASON
sp
FOR
THE
RISE
sp
ITS
sp
GENERAL
MOVEMENTS
AND
sp
NOT
A
sp
SERIOUS
MOVEMENT
AS
sp
FAR
AS
WE'RE
sp
CONCERNED
sp
INCLUDES
sp
THE
WHOLE
ELEMENT
OF
sp
DEBTORS
sp
FROM
sp
OURSELVES
sp
TO
sp
OUR
sp
WHOLESALE
DEBTORS
sp
WHICH
IS
sp
OUR
OWN
MANUFACTURING
sp
OPERATION
WHERE
THEY'RE
SELLING
sp
TO
OUTSIDE
CUSTOMERS
THERE'S
sp
NOTHING
sp
PARTICULARLY
sp
SIGNIFICANT
sp
IN
sp
THAT
sp
HOW
MANY
RE
FITTED
STORES
HAVE
sp
YOU
GOT
NOW
THEN
sp
HOW
MANY
ARE
YOU
sp
PLANNING
sp
TO
RE
sp
FIT
sp
OVER
sp
THE
sp
NEXT
sp
YEAR
WE'VE
GOT
IN
THE
sp
NEW
sp
FORMAT
sp
SIXTY
OF
sp
THE
sp
NEW
NEW
sp
FORMAT
sp
BUT
sp
WHAT
WE
HAVE
BEEN
ABLE
sp
TO
DO
IS
TAKE
ELEMENTS
OF
sp
THE
NEW
sp
RE
FITTED
sp
STORES
sp
AND
PUT
sp
THOSE
sp
{OOV}
sp
FOR
INSTANCE
sp
ERM
{OOV}
PRONTO
sp
WE'VE
MANAGED
TO
sp
TAKE
THOSE
AND
sp
RE
sp
FIT
THEM
SEPARATELY
sp
BUT
THE
ACTUAL
sp
NEW
CONCEPT
sp
STORES
SITS
AT
sp
ABOUT
SIXTY
sp
ODD
STORES
sp
AND
CURRENTLY
WHAT
sp
WE'RE
DOING
IS
sp
TO
sp
CHECK
sp
THE
{OOV}
sp
THAT
WE
HAVE
HAD
A
A
sp
RE
FITS
sp
THIS
YEAR
ERM
sp
WHERE
sp
WE'VE
sp
TAKEN
sp
SPACE
sp
FOR
OTHER
SUB
sp
LETS
sp
WHERE
PUT
sp
THE
sp
NEW
sp
CONCEPT
sp
BACK
TO
sp
BUT
AS
sp
FAR
AS
sp
THE
{OOV}
GO
IN
MAJORITY
OF
sp
THE
CHAIN
sp
NOW
sp
WE
HAVE
sp
MOST
OF
THE
sp
MAJOR
ELEMENTS
sp
I
E
AN
sp
UPHOLSTERY
AREA
sp
BED
AREA
sp
PRONTO
sp
REPRESENTATION
sp
AND
INDEED
THE
sp
RE
FIT
sp
THAT
WAS
sp
DISCUSSED
sp
IN
sp
THE
sp
CHAIRMAN'S
STATEMENT
sp
THE
KITCHEN
AND
sp
BEDROOM
RE
sp
FIT
ERM
sp
WAS
sp
APPLICABLE
TO
ALL
STORES
sp
SO
ALL
OF
sp
THE
STORES
HAVE
sp
GOT
sp
NEW
KITCHENS
sp
AND
BEDROOMS
sp
IN
SO
NO
FURTHER
sp
RE
sp
FITTING
sp
WILL
SUBSTANTIALLY
{OOV}
sp
YEAH
ERM
sp
I
sp
WOULD
TAKE
A
GUESS
sp
THAT
THERE
sp
WILL
BE
sp
BECAUSE
sp
WE
STILL
sp
HAVE
sp
AMBITIONS
sp
TO
SHED
A
LOAD
sp
OF
SPACE
SO
IT
sp
WOULD
sp
BE
ADVISABLE
TO
RE
sp
FIT
TO
RELEASE
sp
FURTHER
SPACE
sp
WE
HAVE
ANOTHER
TWENTY
sp
SIX
SMALLER
STORES
THAT
WE
sp
HAVEN'T
DONE
AT
ALL
YET
sp
OTHER
sp
THAN
sp
PUT
sp
A
{OOV}
SO
YES
WE'LL
HAVE
AN
ON
sp
GOING
RE
FIT
sp
PROGRAMME
I
sp
CAN'T
sp
GIVE
sp
YOU
sp
THE
EXACT
sp
DETAILS
BECAUSE
ERM
{OOV}
HOW
MANY
IT'S
sp
GON
sp
NA
sp
BE
BUT
THERE
WILL
sp
BE
CERTAINLY
AN
sp
ON
sp
GOING
sp
RE
sp
FIT
sp
PROGRAMME
sp
{OOV}
sp
WHAT
IS
sp
PRONTO
'S
INFLATION
{OOV}
PRONTO
sp
IS
ERM
AN
AREA
OF
THE
sp
STORE
WHERE
sp
WE
SELL
OUR
OCCASIONAL
sp
FURNITURE
sp
AND
ERM
sp
SMALL
sp
PRICED
COFFEE
sp
TABLES
sp
HI
FI
sp
UNITS
sp
THE
OCCASIONAL
sp
FURNITURE
THAT
sp
MAY
sp
GO
{OOV}
ERM
sp
WHEREAS
UP
sp
UNTIL
A
sp
COUPLE
OF
sp
YEARS
AGO
sp
WE
USE
sp
TO
sp
DISPLAY
THIS
sp
PRODUCT
sp
AROUND
THE
SHOWROOM
sp
FLOOR
sp
PART
OF
sp
THE
NEW
CONCEPT
STORES
sp
WAS
THAT
sp
WE
ACTUALLY
{CG}
SET
THE
sp
SAME
SECTION
sp
IN
THE
SHOWROOM
sp
WHICH
IS
sp
VERY
MUCH
LIKE
A
sp
A
sp
SHELVING
SYSTEM
sp
WHEREBY
THE
STOCK
ACTUALLY
SITS
ON
THE
SHELVES
sp
THE
CUSTOMER
sp
WALKS
IN
AND
sp
IT'S
AN
EASY
sp
EASY
sp
PURCHASE
STRAIGHT
OFF
sp
THE
sp
TROLLEY
ERM
sp
VERY
sp
MUCH
LIKE
THE
sp
SUPERMARKET
sp
OPERATION
sp
SO
sp
IT'S
THE
LOWER
PRICED
sp
GOOD
sp
VALUE
sp
OCCASIONAL
sp
TYPE
sp
FURNITURE
sp
THE
CASH
sp
AND
CARRY
sp
THE
KIND
OF
THINGS
sp
THAT
sp
YOU
sp
DON'T
sp
NEED
sp
SALES
ASSISTANTS
sp
FOR
sp
THE
sp
KIND
sp
OF
BOOKCASE
sp
THAT
YOU
WOULD
sp
PUT
IN
YOUR
sp
CHILDREN'S
sp
BEDROOM
THAT
sp
KIND
OF
THING
sp
AS
sp
PART
OF
sp
THE
{OOV}
WHAT
sp
THE
sp
STORES
sp
BACK
IN
THE
sp
MID
EIGHTIES
{OOV}
WERE
sp
MORE
sp
EXPENSIVE
sp
SUITES
sp
AND
SO
sp
{OOV}
TOO
sp
CONFLICTING
sp
WE
HAD
A
sp
FIFTY
sp
OR
sp
TWENTY
FIVE
POUND
COFFEE
sp
TABLE
sp
WE
sp
SOLD
{OOV}
{OOV}
sp
THE
sp
TWO
sp
GREATER
sp
MIXTURE
sp
SO
ITS
A
sp
METHODOLOGY
OF
sp
JUST
AN
ORDINARY
sp
TABLE
sp
FOR
EXACTLY
sp
WITHOUT
sp
CONFLICT
WHAT
WERE
THESE
sp
WHAT
WAS
sp
THE
SALES
AREA
OF
sp
THE
sp
{OOV}
HOW
MUCH
sp
SALES
AREA
DID
YOU
ACTUALLY
RELEASE
IN
sp
THE
FIRST
HALF
AND
sp
HOW
MUCH
DO
YOU
EXPECT
sp
TO
GO
IN
THE
SECOND
sp
I'LL
sp
GIVE
sp
YOU
THE
ANSWER
sp
TO
THAT
sp
ONE
sp
JUST
sp
BEAR
WITH
sp
ME
A
MOMENT
sp
PLEASE
I'LL
TRY
TO
sp
BE
PRECISE
{OOV}
sp
RIGHT
sp
THE
sp
ERM
sp
TRADING
AREA
THE
CLOSING
sp
TRADING
AREA
sp
AT
sp
THE
END
sp
OF
THE
sp
NOVEMBER
NINETY
sp
THREE
sp
WAS
SIX
sp
THOUSAND
sp
AND
sp
FORTY
sp
SORRY
sp
SIX
MILLION
sp
{CG}
sp
FORTY
THOUSAND
SQUARE
FEET
AT
sp
THE
sp
PREVIOUS
YEAR
IN
APRIL
NINETY
sp
THREE
IT
sp
WAS
SIX
MILLION
AND
sp
THIRTY
SIX
THOUSAND
SQUARE
FEET
sp
THAT
INCLUDES
sp
FRANCE
sp
DOES
sp
IT
sp
THAT
INCLUDES
FRANCE
sp
WHICH
HAS
SEEN
AN
INCREASE
sp
IN
FOOTAGE
sp
OF
sp
A
sp
THIRTY
sp
THOUSAND
SQUARE
sp
FEET
AND
sp
WE'VE
sp
ALSO
sp
GOT
sp
A
NUMBER
sp
OF
sp
SUB
sp
LETS
sp
WE'VE
sp
INDICATED
sp
THAT
ERM
sp
SUB
LETS
SHOULD
PAY
sp
{OOV}
REDUCES
IT
sp
DO
sp
THESE
FIGURES
sp
INCLUDE
OR
EXCLUDE
THAT
sp
SUB
sp
LET
sp
THEY
sp
INCLUDE
sp
THE
SUB
LET
SPACE
AND
WHERE
WE
SUB
LET
SPACE
sp
WE
DEDUCT
sp
THAT
SPACE
sp
FROM
THE
sp
TRADING
sp
AREA
sp
FIGURE
sp
RIGHT
sp
HAS
IT
sp
STILL
GONE
UP
sp
YEAH
BECAUSE
WE'VE
OPENED
STORES
IN
sp
FRANCE
sp
AND
WE'VE
ALSO
A
NEW
STORE
sp
IN
THE
U
K
sp
THERE'S
sp
PLUSES
AND
MINUSES
THERE'S
sp
PLUSES
IN
sp
FRANCE
sp
PLUSES
IN
THE
sp
U
K
WITH
sp
ONE
NEW
sp
STORE
sp
ERM
sp
AND
sp
MINUSES
sp
WITH
THE
SUB
sp
LETS
sp
SORRY
sp
JUST
REMIND
US
WHAT
PROPORTION
sp
IS
sp
IS
A
FLAT
PACK
sp
REPRESENTS
sp
OF
YOUR
TOTAL
SALES
sp
UNCLEAR
sp
FIFTEEN
sp
SOMETHING
sp
{OOV}
LOW
EIGHTY
sp
PER
CENT
sp
OBVIOUSLY
sp
VARIES
LOW
EIGHTY
sp
LOW
EIGHTY
sp
LOW
EIGHTY
sp
IT
sp
VARIOUS
FROM
sp
SEASON
sp
TO
SEASON
sp
AS
UPHOLSTERY
IS
sp
MORE
sp
POPULAR
OR
LESS
POPULAR
AS
sp
BEDS
ARE
sp
MORE
sp
POPULAR
sp
AT
THE
{OOV}
sp
THE
OTHER
QUESTION
sp
HOW
SERIOUSLY
DO
YOU
sp
VIEW
THE
sp
LIKELY
sp
IMPACT
sp
OF
THE
sp
NEW
sp
THE
BUDGET
sp
ER
sp
CHANGE
sp
COME
sp
COMING
sp
INTO
FORCE
IN
THE
SPRING
sp
ON
PURCHASES
OF
CONSUMER
DURABLES
SUCH
AS
sp
YOURS
sp
BEARING
IN
MIND
YOUR
sp
AND
sp
YOUR
sp
CUSTOMER
PROFILE
sp
YEAH
I
MEAN
WE
DID
INSERT
ACTUALLY
sp
IN
THE
CHAIRMAN'S
STATEMENT
A
sp
CAUTIONARY
NOTE
ABOUT
sp
THE
sp
CREDIT
ANNOUNCEMENT
sp
BECAUSE
TWO
YEARS
AGO
WE
sp
HAD
A
SIMILAR
INCREASE
WHICH
sp
IN
FACT
sp
BY
sp
THE
TIME
WE
GOT
TO
THE
END
OF
THE
YEAR
HAD
DISAPPEARED
sp
SO
sp
WE
VIEW
IT
sp
WITH
sp
A
LOT
OF
CAUTION
IS
sp
THE
ANSWER
sp
IF
sp
YOU
ASK
ME
TO
BE
sp
MORE
PRECISE
I
sp
CAN'T
sp
BECAUSE
sp
WE'VE
sp
NEVER
REALLY
HAD
A
SET
OF
sp
TAX
sp
INCREASES
sp
THE
LIKE
OF
WHICH
sp
WE
FACE
NOW
sp
ANY
sp
OTHER
QUESTIONS
sp
IN
FACT
WE
sp
OH
SORRY
sp
YES
ERM
sp
SUB
LETS
sp
ERM
sp
ON
THE
SUB
LETS
{OOV}
A
sp
BIG
sp
PACKAGE
DEALS
sp
WITH
sp
ANY
sp
OTHER
sp
RETAILERS
sp
AND
WHAT
WOULD
BE
THE
sp
BIGGEST
{OOV}
OH
THE
ERM
IF
THERE
IS
A
SORT
OF
MAJOR
sp
BENEFICIARY
THAT
sp
{OOV}
sp
CARPET
RIGHT
sp
BECAUSE
OF
sp
COURSE
sp
WE
OWNED
sp
THE
sp
{OOV}
IN
THEM
{OOV}
FAIRLY
DECENT
STRAIGHT
THROUGHOUT
sp
CURRYS
DIXONS
AND
sp
SOME
sp
OF
sp
THE
{OOV}
MARKET
sp
PEOPLE
sp
QUICKSAVE
ERM
sp
THE
SORT
OF
SPREAD
YOU'D
EXPECT
ON
ANY
sp
RETAIL
sp
PARK
sp
YOU
KNOW
sp
I
THINK
THAT
PART
sp
OF
OUR
BUSINESS
sp
MAKES
IT
MORE
DIFFICULT
sp
BECAUSE
AH
THE
sp
PURCHASE
OF
ALLIED
CARPETS
sp
BY
sp
CARPETLAND
sp
IS
{OOV}
THE
SPACE
OF
sp
THE
MARKET
sp
AT
A
FAIRLY
sp
SPEEDY
sp
RATE
AND
sp
I
sp
PERSONALLY
BELIEVE
OTHER
RETAILERS
WILL
HAVE
sp
THE
POLICY
sp
TO
SUB
LET
sp
SURFACE
sp
AREAS
IN
THE
NEXT
sp
FEW
YEARS
sp
SO
IT'S
SOMETHING
WE
sp
GOT
ON
WITH
sp
THREE
YEARS
sp
AGO
AND
VERY
sp
PLEASED
WE
DID
IT
THANK
YOU
VERY
MUCH
sp
FOR
sp
YOUR
ATTENTION
sp
GENTLEMEN