2014 Preliminary Results

26 February 2015


The full results
are available in PDF Format


Chief Executive, Matthew Ingle, said:

"Howdens has delivered another good set of results in 2014. Sales exceeded £1bn for the first time in our twenty-year history. Profitability also increased and we saw strong cash flow. As a result, we are recommending a substantial increase in our dividend and announcing a £70m cash return to shareholders by way of a share buyback.

"We have continued to invest in all aspects of the business, improving our operations, pursuing the growth opportunities before us and taking advantage of better market conditions. In the UK, we opened 30 new depots and, in continental Europe, we pushed forward with an expanded trial, opening two depots in Belgium.

"The service proposition that Howdens provides to its small builder customers is supported by the unique combination of our locally empowered depots and our supply operations. The strength of this has enabled us to continue to increase the number of account holders, who form the bedrock of our business, to over 350,000.

"Looking at 2015, trading conditions seen in 2014 have continued into the early part of the year. As well as planning to open 30 new depots in the UK, we plan to open seven more depots in northern France.

"The recovery in the market seen since the summer of 2013 and our performance since then has caused us to review our growth prospects. As a result, we have identified the need for increased investment in the business. This is to ensure that we can take advantage of the growth opportunities that we now foresee, and to address the challenges of a more complex market and security of supply. In particular, we plan to increase investment in our manufacturing and logistics operations."


Financial results (continuing operations1)

The information presented here relates to the 52 weeks to 27 December 2014 and the 52 weeks to 28 December 2013 2, unless otherwise stated.

  • Howden Joinery UK depot revenue increased by 14.3% to £1,075.5m (up 10.8% on same depot basis). Group revenue was £1,090.8m (2013: £956.5m);
  • Gross profit margin was 63.7% (2013: 61.7%);
  • Operating profit rose from £140.7m to £189.8m;
  • Profit before tax increased to £188.8m (2013: £135.0m), the net interest charge falling by £4.7m (due to a decrease in the pensions finance expense);
  • Basic earnings per share items increased from 15.9p to 23.2p;
  • Net cash of £217.7m at year-end (28 December 2013: £140.5m net cash);
  • Final dividend of 6.5p recommended, giving full year dividend of 8.4p per share (2013: 5.5p);
  • £70m to be returned to shareholders, through a share repurchase programme.

1 2013 comparatives exclude exceptional items. 2 Restated for amendments to IAS19 - see note 2.

Business developments

  • Investment in the future growth of the business continues:
    • 30 new depots opened in UK in 2014, bringing total to 589;
    • French trial extended: 2 depots opened in Belgium; plan to open up to 7 additional depots in northern France in 2015;
    • capital expenditure totalled £32.8m;
    • capital expenditure expected to average £60m p.a. over next three years, as we invest in key aspects of our operations to support further growth.

Current trading

  • Howden Joinery UK depot revenue in the first two periods of 2015 rose by 9.9%1, in line with our expectations;
  • Our outlook for the business for 2015 remains unchanged.

1 This excludes the first week, which had one less trading day in 2015 than in 2014.



Gary Rawlinson
Head of Investor Relations

+44 (0)207 535 1127 (not 26 February 2015)
+44 (0)7989 397527

Maitland +44 (0)207 379 5151

Greg Lawless

Angus Maitland


Note for editors:

Howden Joinery Group Plc is the parent company of Howden Joinery. In the UK, Howden Joinery is engaged in the sale of kitchens and joinery products to trade customers, primarily small local builders, through almost 600 depots. Around one-third of the products it sells are manufactured in the company's own factories in Runcorn, Cheshire, and Howden, East Yorkshire. The business also has small operations in France and Belgium.

Website: www.howdenjoinerygroupplc.com



The information presented here relates to the 52 weeks to 27 December 2014 and the 52 weeks to 8 December 2013.

Continuing operations before exceptional items1, £m 2014 2013

- Group
1,090.8 956.5
- Howden Joinery UK depots 1,075.5 940.7
Gross profit 694.5 590.2
Gross profit margin, % 63.7 61.7

Operating profit 189.8 140.7
Profit before tax 188.8 135.0

Basic earnings per share 23.2p 15.9p

Dividend per share 8.4p 5.5p

Net cash at end of period 217.7 140.5

  1. There were no exceptional items from continuing operations in 2014. In 2013, there was an exceptional operating cost before tax of £4.5m from continuing operations.

    In 2014, there was an exceptional profit after tax on discontinued operations of £9.1m. There were no discontinued operations in 2013.
  2. Restated for amendments to IAS19 - see note 2.



The information presented here relates to the 52 weeks to 27 December 2014 and the 52 weeks to 28 December 2013, (continuing operations before exceptional items), unless otherwise stated 1.

The financial performance of the Group during 2014 benefited from the Group's competitive position and the continuing focus on improving operational performance. We also benefited from the continuation of improved market conditions seen since the summer of 2013.

Total Group revenue increased by £134.3m to £1,090.8m.


Revenue £m 2014 2013
Group 1,090.8 956.5
Howden Joinery UK depots
Howden Joinery French depots

Howden Joinery UK depot revenue rose by 14.3% to £1,075.5m, increasing by 10.8% on a same depot basis.

This growth was achieved through a number of factors and is a testament to the strength of the Howdens business model. We have continued to open new depots and increased the number of customer accounts. As well as driving an increase in revenue, the business continued to focus on price discipline and margin (see below).

Sales by our French depots of £15.3m increased by 2% on a same depot basis in constant currency terms, whilst falling slightly on a reported basis. Profitability has improved following changes to the commercial strategy in our French depots.

Gross profit rose by £104.3m to £694.5m. The gross profit margin for the year increased to 63.7% (2013: 61.7%). This reflected the continuing focus on efforts within supply to reduce the cost of manufactured and bought-in products, and price discipline and margin achievement across all depots. It also included a benefit from the strengthening of the pound against both the euro and US dollar.

Selling and distribution costs, and administrative expenses increased by £55.2m to £504.7m. The increase reflects the costs of new depots, investment in growth and the impact of inflation, including on payroll costs.

Operating profit increased by £49.1m to £189.8m.

The net interest charge fell by £4.7m to £1.0m, due to a lower finance expense in respect of pensions. The net result was profit before tax rose by £53.8m to £188.8m.

The tax charge on profit before tax was £40.1m, an effective rate of tax of 21.2%.

Basic earnings per share were 23.2p (2013: 15.9p).

In 2014, there was an exceptional profit after tax from discontinued operations of £9.1m. This mainly comprised income of £11.1m arising from the release of a tax creditor (following partial resolution of a dispute with HMRC regarding the tax treatment of certain expenses relating to our legacy properties), partially offset by a charge of £2.2m relating to an increase in the provision for our remaining legacy properties.

At 27 December 2014, the pension deficit shown on the balance sheet was £142.6m (28 December 2013: £54.3m). The increase in the deficit was due to higher liabilities arising primarily from a decrease in the discount rate, which more than offset the Group's contribution to fund the deficit and better than expected asset returns.

We saw strong cash flow in 2014.

There was a net cash inflow from operating activities of £147.8m. This was after a cash contribution to the Group's pension schemes, in excess of the operating charge, of £32.8m2 and payments relating to legacy properties totalling £5.3m.

Excluding the legacy property payments, underlying working capital was broadly unchanged. Increases in stock and debtors were offset by an increase in trade creditors.

Also included within net cash flows from operating activities was tax paid totalling £30.3m.

Payments to acquire fixed and intangible assets totalled £32.8m (2013: £24.7m).

Reflecting the above, there was a net cash inflow of £77.2m in 2014, the Group having net cash of £217.7m at the end of the year (28 December 2013: £140.5m net cash).

  1. There were no exceptional items from continuing operations in 2014. In 2013, there was an exceptional operating cost before tax of £4.5m from continuing operations.

    In 2014, there was an exceptional profit after tax on discontinued operations of £9.1m. There were no discontinued operations in 2013.
  2. As previously announced, an additional one-off payment for the pension year ending April 2015 of £10m will be paid in 2015.


The Group's dividend policy is to target dividend cover of between 2.5x and 3x, with one third of the previous year's dividend being paid as an interim dividend each year. Given the operational performance of the business and the cash generation in 2014, in light of this policy, the Board has decided to recommend to shareholders a final dividend of 6.5p, giving a total dividend for the year of 8.4p (2013: 5.5p). This equates to a dividend cover of 2.75x, the Board intending to pursue a progressive dividend policy in future years.

As previously stated, the Board intends to target a capital structure that is both prudent and recognises the benefits of operational and financial leverage, and, after considering our capital requirements, to return surplus cash to shareholders as appropriate. The Group has significant property leases for the depot network, and continues to have a material deficit in the Group pension fund and a small number of remaining legacy liabilities related to the Group's former ownership of MFI. Taking into account this underlying level of gearing, the Board believes it is appropriate for the Group to be able to operate through the annual working capital cycle without incurring bank debt.

The Board has reviewed the cash balances in light of the Group's future investment opportunities, expected peak working capital requirements and trading outlook. As a result, it has decided to return £70m of cash to shareholders by way of a share repurchase programme. This will commence shortly and will be implemented over the course of the next two years.

Shares that are bought in the market by our brokers will either be held in treasury, to use for future obligations for company share schemes, or cancelled.



The business model of Howden Joinery is "To supply from local stock nationwide the small builder's ever-changing, routine, integrated kitchen and joinery requirements, assuring best local price, no-call-back quality and confidential trade terms".

Since it started in autumn 1995, the business has opened new depots and increased turnover continuously, except for a 12-month period in 2008-9.

Even today, with nearly 600 depots across the UK, we continue to see the opportunity to transform the scale of the business, seeing scope for at least 700 depots. We continue to invest in all aspects of the growth and performance of the business, including new depots and depot operations, existing and new employees, product development, and manufacturing and distribution.

UK depot network and operations

During the course of 2014, 30 new depots were opened, bringing the total number of depots trading at the end of the year to 589. In addition, two depots were relocated and three were extended.

In the summer of 2012, we began trials of a 'virtual showroom' that is designed to support our 1,000 depot-based kitchen designers. When working with our account holders' clients in our depots, this allows kitchen designs to be shown on a large HD television screen or projected on to a wall in the depot in a large high-definition format, along with other material designed to support product sales. Often, this will be accompanied by a refurbishment of the office in which the designers work. This project to roll-out 'virtual showrooms' across all of our depots has been completed.

To support our account holders and improve our service to their clients, we undertook a project to install A3 printers in all of our depots. These provide builders with a technical drawing of each kitchen design that is much more usable on-site. They also allow more impressive visualisations of the kitchen to be provided to the builder's client. This project has also been completed.

Our account base continues to grow, having increased by over 40,000 net new accounts in 2014. Initiatives to stimulate account openings meant this was double the number seen in previous years. While there has been a significant increase in accounts in recent years, our debt collection performance continues to be robust.

Product and marketing

We continue to enhance our product offering, having introduced a number of new products during 2014 across all our product categories.

Notable amongst these were eighteen new kitchens, which included: six gloss options and two matt options in our Greenwich family; three options in a new, lower-priced, gloss integrated handle range, Clerkenwell; and three options in a new, premium, Tewkesbury framed family.

To ensure we cater for all budgets and price points, we have introduced a number of new products, including: a premium touch control Lamona pyrolytic oven, combination microwave and warming drawer; a collection of premium handles and a range of competitively priced rose handles; and a new 'entry priced' rigid cabinet.

In addition, we continue to enhance our other product offerings, including new products in our worktops and backboards, sinks, doors and flooring ranges. We also started a trial of selling affordable granite worktops from stock, beginning in a small number of depots. Initial results from this have been encouraging and the trial has recently been extended to an additional 40 depots.

We continue to invest in our marketing communications and brand advertising. As well as updating our range of marketing literature and the Howdens website (www.howdens.com), we embarked on a partnership with pottery designer and manufacturer Emma Bridgewater. Emma designed for us a pair of Howdens mugs and fluted bowls that were given away with every kitchen plan for limited periods, the partnership being featured in our adverts and on the Howdens website.  To further raise awareness of the Howdens brand, we attended 13 county shows and agriculture fairs throughout the UK during the summer.

Manufacturing and logistics operations

Our UK-based manufacturing and logistics operations play a vital role in ensuring that we are able to supply our small builder customers from local stock nationwide at all times, having the flexibility to respond to each depot's individual needs. We continue to invest in these operations so as to ensure that this aspect of the Howdens model is never compromised, even during our critical 'period 11', when sales are more than double the level seen in other periods.

We are close to completing a two-year project to replace obsolete boilers and the associated heating infrastructure at our site in Howden with a state-of-the-art biomass heating system. This will ensure that we continue to be compliant with environmental emissions legislation and will reduce manufacturing costs, as the heat generated attracts payments provided by the Renewable Heat Incentives programme.

We have completed the replacement of the 100 'tractor units' for our fleet of lorries. These are Euro 6 compliant and are fitted with the latest technology for environmental compliance. In addition, they have enhanced safety features, including:

  • crash avoidance technology that assists the driver when it detects the risk of a collision; and
  • forward facing cameras for incident recording, to help with accident investigation and insurance claims.

Replacement of 400 'trailer units' for our fleet of lorries will begin in the spring.

Continental Europe

As we set out at the interim results in July, we have amended the pricing strategy in our French depots. As a result, we have seen an improvement in the financial performance of the depots, notwithstanding the widely reported economic headwinds in the country.

This has given us the confidence to add a second phase of depots to our operations in northern France, our plan being to open seven new depots during the second half of 2015.

It has also given us the confidence to extend the trial, both in France and in other countries in continental Europe. First, we have opened two depots in Belgium that are the same format as our existing French depots and will allow us to learn about a slightly different market. Second, we have opened an outlet with a new format and branding further south in France, with another planned to be opened late in 2015. This is larger than existing depots, and will be used to test a number of new initiatives. We also intend to begin a trial in Holland, where we plan to open a similar larger format depot towards the end of this year.




Legacy properties

The Group continues to reduce its legacy property portfolio.

One lease was terminated in 2014, at a cost of just over £3m, and one lease, with less than six months remaining, was released early. In addition, the leases of two properties expired during the year.

This means that there are now five legacy properties remaining, with net annual rent and rates of less than £1m.


We have undertaken a review of the medium and longer term growth prospects for the business and have identified more significant opportunities than previously foreseen. Kitchens continue to grow in complexity as kitchen users expect increasing functionality as well as a constant flow of new designs. At the same time, our account base continues to grow, and we are focused on delivering better and better local service to more and more builders.
Following on from this review, we have been considering how to ensure that we are best placed to deal with and take advantage of what the future might bring.

In respect of our supply operations, a number of areas have been identified for investment in the coming years. These include preparing for future growth and improved resilience of our cabinet manufacturing operations, a new national distribution centre (NDC) for bought-in products, increased manufacturing capacity in non-cabinet products and replacing aged manufacturing assets. As a result, we expect capital expenditure across the business to average around £60m per annum over the next three years. The exact phasing of this will depend on the timing of the building and fitting-out of the new NDC.



Howden Joinery UK depot sales in the first two periods of 2015 (to 21 February) were up 9.9% on the same period last year (this excludes the first week, which had one less trading day in 2015 than in 2014), in line with our expectations. Along with the evidence we have of trading prospects, this would suggest that market conditions remain unchanged.

The Group remains committed to its view that the number of depots in the UK can be increased from its current level of 589 to at least 700. During the course of 2015, we are currently planning to open up to 30 depots in the UK.

We are well positioned and look forward to continued growth. As in recent years, we will act quickly and appropriately adapt our business model to the market and economic conditions we encounter.



The Group meets its day to day working capital requirements through cash generated from operations. If required, the Group also has access to an asset backed lending facility of £140m until the facility expires in July 2016.

The Group's forecasts and projections have been stress-tested for reasonably possible adverse variations in trading performance. The results of this testing show that the Group should be able to operate within the level of its current facility and covenants.

After making due enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the accounts.



The Board considers that the Group's principal risks and uncertainties, together with an indication of actions taken to manage and mitigate them, are as detailed below. They do not comprise all risks associated with the Group and are not set out in any order of priority. Additional risks not presently known to management or currently deemed to be less material may also have an adverse effect on the Group's business in the future.

In each of the following sections, all except the last paragraph describe each risk and its possible impact. The final paragraph describes the steps that are taken to mitigate each risk.

Market conditions

The Group's products are predominantly sold to small local builders for installation in public and private housing, mainly in the repair, maintenance and improvement markets.

The Group's results are consequently dependent on levels of activity in these markets, which are impacted by many factors including general economic conditions, consumer confidence, interest rates and credit availability, unemployment, demographic trends and, in the short term, weather.

A severe downturn in market conditions could impact on our ability to achieve our sales and profit forecasts. This could in turn put pressure on our cash availability and banking covenants.

We monitor the market closely and can take swift management action as necessary in response to adverse changes, with the aim that the business is aligned to market conditions and, consequently, that we should have sufficient cash and borrowing facilities for business needs and adequate covenant headroom.

Failure to implement the Group's business model and culture

The future success of the business depends on the successful implementation of the Group's business model and locally-enabled, entrepreneurial culture.

In particular, if the Group fails to implement its business model in the locally-enabled, decentralised manner envisaged, there may be an adverse effect on the Group's future financial condition and profitability.

Led by the actions of the Board and Executive Committee, the business model and the Howdens culture are at the centre of the activities and the decision-making processes of the Group, and are continually emphasised. The Executive and senior management regularly visit our depots and factories, and hold regular events during which they reinforce the importance of the Group's business model and culture. Throughout the business, successful implementation of the Group's business model and culture forms the basis of the incentive structure.

Failure to maximise exploiting the growth potential of the business

The Group considers that there is significant potential for growth, and has identified this as a strategic opportunity and aim.

If the growth opportunities are not understood and exploited in line with our business model, or if current structures and skills within the Group are not aligned to meet the challenges of growth, there may be an adverse effect on the Group's ability to obtain maximum benefit from this growth potential.

The Group places continuing focus on the opportunities, challenges and additional requirements related to growth. The potential for growth is incorporated into group strategic plans and budgets, and existing structures and skills are reviewed in the context of growth, and adjusted where necessary.

Continuity of supply

The Group's business model requires that every depot can supply product from local stock.

Any disruption to the relationship with key suppliers or interruption to manufacturing operations could adversely affect the Group's ability to implement the business model.

With suppliers, the Group tries to maintain dual supply wherever possible to mitigate the effects if a key supplier was unable to deliver goods or services. We also enter into long term contracts to secure supply of our key materials. Good supplier relations are maintained by prompt settlement of invoices, regular communication and an annual supplier conference. Within our manufacturing operations, we adopt best practice health & safety and fire prevention procedures. Business continuity plans are in place for key production processes. The Group has recently made significant investment in its manufacturing facilities, to enable manufacturing capacity to match our expected growth, as well as providing further cabinet production capacity which now provides additional cover in the event of an interruption to manufacturing operations.

Loss of key personnel

The skills, experience and performance of key members of the Group's management team make a large contribution to the Group's success.

The loss of a key member of the Group's management team could adversely affect the Group's operations.

The Group uses the Remuneration Committee to ensure that key team members are appropriately compensated for their contributions and incentivised to continue their careers with the Group.



Certain statements in this Preliminary Results announcement are forward-looking. Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. Because these statements contain risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. We undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.



The following statement will be contained in the 2014 Annual Report and Accounts.

We confirm to the best of our knowledge:

  • the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and Company, and the undertakings including the consolidation taken as a whole;
  • the Annual Report and Accounts includes a fair review of the development and performance of the business, and the position of the Group and Company and the undertakings including the consolidation taken as a whole, together with a description of the principal risks and uncertainties they face; and
  • the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable, and provides the information necessary for shareholders to assess the Group's and Company's performance, business model and strategy.


By order of the Board

M Ingle
Chief Executive
M Robson
Deputy Chief Executive and Chief Financial Officer
25 February 2015


Consolidated income statement

52 weeks to 28 December 2013
Continuing operations: Notes 52 weeks to
27 December

Revenue - sale of goods
1,090.8 956.5 - 956.5
Cost of sales
(396.3) (366.3) - (366.3)
Gross profit
694.5 590.2 - 590.2
Selling & distribution costs
(423.1) (375.5) - (375.5)
Administrative expenses
(81.6) (74.0) (4.5) (78.5)
Operating profit
189.8 140.7 (4.5) 136.2
Finance income 5 0.6 0.4 - 0.4
Finance expense 6 (0.1) (0.4) - (0.4)
Other finance expense - pensions 6 (1.5) (5.7) - (5.7)
Profit before tax
188.8 135.0 (4.5) 130.5
Tax on profit 7 (40.1) (33.7) 0.5 (33.2)
Profit after tax
148.7 101.3 (4.0) 97.3

Discontinued operations:

Exceptional item - loss on discontinued operations
(2.1) - - -
Exceptional item - tax on discontinued operations
11.2 - - -
Profit after tax 12 9.1 - - -

Profit for the period attributable to the equity
holders of the parent

157.8 101.3 (4.0) 97.3

Earnings per share:

From continuing operations

Basic earnings per 10p share 8 23.2p

Diluted earnings per 10p share 8 23.0p


From continuing and discontinued operations

Basic earnings per 10p share 8 24.6p

Diluted earnings per 10p share 8 24.4p


*Restated for amendments to IAS 19 - see note 2. **See note 4.


Consolidated statement of comprehensive income

52 weeks to
27 December
52 weeks to
28 December
Profit for the period 157.8 97.3
Items of other comprehensive income

Items that will not be reclassified subsequently to profit or loss:

Actuarial (losses)/gains on defined benefit pension scheme (119.6) 73.0
Deferred tax on actuarial losses/(gains) on defined benefit pension scheme 23.9 (16.8)
Effect of change in UK tax rate on deferred tax on cumulative actuarial loss - (1.6)
Deferred tax on pension contributions (6.3) -
Current tax on pension contributions 6.8 -
Items that may be reclassified subsequently to profit or loss:

Currency translation differences (0.2) 0.5
Other comprehensive income for the period (95.4) 55.1
Total comprehensive income for the period attributable to
equity holders of the parent
62.4 152.4

*Restated for amendments to IAS 19 - see note 2.


Consolidated balance sheet

Notes 27 December 2014
28 December 2013
Non-current assets

Other intangible assets
3.4 3.7
Property, plant and equipment
107.1 95.5
Deferred tax asset
40.3 23.2
Bank borrowings net of prepaid fees
0.3 0.9

151.1 123.3
Current assets

Bank borrowings net of prepaid fees
0.6 0.1
143.1 123.4
Trade and other receivables
132.9 122.4
85.0 -
Cash at bank and in hand
131.9 139.7

493.5 385.6
Total assets
644.6 508.9

Current liabilities

Trade and other payables
(185.9) (158.4)
Current tax liability
(7.9) (18.7)
Current borrowings
- (0.1)

(193.8) (177.2)
Non-current liabilities

Non-current borrowings
(0.1) (0.1)
Pension liability
(142.6) (54.3)
Deferred tax liability
(2.6) (3.6)
Provisions 9 (10.6) (12.0)

(155.9) (70.0)
Total liabilities
(349.7) (247.2)

Net assets
294.9 261.7


Called up share capital
64.7 64.3
Share premium account
87.5 87.5
ESOP reserve
2.4 (6.3)
Other reserves
28.1 28.1
Retained earnings
112.2 88.1
Total equity
294.9 261.7

The financial statements were approved by the Board on 25 February 2014 and were signed on its behalf by Mark Robson - Deputy Chief Executive and Chief Financial Officer.


Consolidated statement of changes in equity

Called up

Share premium account


Retained profit
As at 29 December 2012 64.2 87.2 (19.0) 28.1 (47.7) 112.8
Accumulated profit for the period* - - - - 97.3 97.3
Net actuarial gain on defined benefit scheme* - - - - 56.2 56.2
Effect of change in UK tax rate on deferred tax on cumulative actuarial loss - - - - (1.6) (1.6)
Current tax on share schemes - - - - 4.6 4.6
Deferred tax on share schemes - - - - 3.1 3.1
Effect of change in UK tax rate on deferred tax on cumulative balance on share schemes - - - - (1.0) (1.0)
Currency translation differences - - - - 0.5 0.5
Net movement in ESOP - - 12.7 - - 12.7
Issue of new shares 0.1 0.3 - - - 0.4
Dividends declared and paid - - - - (23.3) (23.3)
As at 28 December 2013 64.3 87.5 (6.3) 28.1 88.1 261.7
Accumulated profit for the period - - - - 157.8 157.8
Net actuarial loss on defined benefit scheme - - - - (95.7) (95.7)
Deferred tax on pension contributions - - - - (6.3) (6.3)
Current tax on pension contributions - - - - 6.8 6.8
Current tax on share schemes - - - - 5.0 5.0
Deferred tax on share schemes - - - - (1.9) (1.9)
Currency translation differences - - - - (0.2) (0.2)
Net movement in ESOP - - 8.7 - - 8.7
Issue of new shares 0.4 - - - (0.4) -
Dividends declared and paid - - - - (41.0) (41.0)
As at 27 December 2014 64.7 87.5 2.4 28.1 112.2 294.9

The ESOP Reserve includes shares in Howden Joinery Group plc with a market value on the balance sheet date of £23.8m (2013: £36.2m), which have been purchased in the open market and which are held by the Group's Employee Share Trusts in order to satisfy share options and awards made under the Group's various share-based payment schemes.

The Other Reserve was created in the year to 30 April 1994, following a Group reconstruction.

*Restated for amendments to IAS 19 - see note 2.


Consolidated cash flow statement

Notes 52 weeks to
27 December 2014
52 weeks to
28 December

Group operating profit before tax and interest

Continuing operations
189.8 136.2
Discontinued operations
(2.1) -
Group operating profit before tax and interest
187.7 136.2

Adjustments for:

Depreciation and amortisation included in operating profit
20.8 18.7
Share-based payments charge
6.4 8.4
Loss on property, plant and equipment, and intangible assets
0.4 -
Exceptional items (before tax)
2.1 4.5
Operating cash flows before movements in working capital
217.4 167.8

Movements in working capital and exceptional items

Increase in stock
(19.7) (7.5)
Increase in trade and other receivables
(10.5) (26.4)
Increase in trade and other payables and provisions
23.7 11.7
Difference between pensions operating charge and cash paid
(32.8) (32.9)
Net cash flow - exceptional items
- (4.5)

(39.3) (59.6)
Cash generated from operations
178.1 108.2
Tax paid
(30.3) (21.0)
Net cash flow from operating activities 11 147.8 87.2


Consolidated cash flow statement - continued

Notes 52 weeks to
27 December

52 weeks to
28 December
Net cash flows from operating activities
147.8 87.2

Cash flows used in investing activities

Payments to acquire property, plant and equipment, and intangible assets
(32.8) (24.7)
Receipts from sale of property, plant and equipment, and intangible assets
0.3 -
Interest received
0.6 0.4
Net cash used in investing activities
(31.9) (24.3)

Cash flows from financing activities

Interest paid
(0.1) (0.1)
Receipts from issue of own share capital
- 0.4
Receipts from release of shares from share trust
2.3 4.3
Decrease/(increase) in prepaid loan fees/loans
0.1 (1.1)
Repayment of capital element of obligations under finance leases
- (0.1)
Dividends paid to Group shareholders
(41.0) (23.3)
Net cash used in financing activities
(38.7) (19.9)

Net increase in cash and cash equivalents
77.2 43.0
Cash and cash equivalents at beginning of period
139.7 96.7
Cash and cash equivalents at end of period 11 216.9 139.7

There are no cash flows from discontinued operating, investing or financing activities.

*Restated for amendments to IAS19 - see note 2.


HOWDENS Making space more valuable

Business Model and Strategy

Find out more about our business model and strategy, the markets in which we operate and our strategic approach to protect our unique business model and ensure that the business continues to grow.


As a familiar sight across towns and cities in the UK and Europe, our depots are always within easy reach, so a trade professional never has far to travel to find their nearest Howdens. Get to know more about how each one operates.


Our sustainable behaviour is at the heart of our business and enables us to reduce some of our risks. We take great pride in ensuring that our business positively impacts the world around us and the people within it.


We are passionate about supporting the local communities we operate in, which is why our depots and support staff actively seek ways to give something back. Whether it is running half marathons or sponsoring local Scout groups, discover the many ways we help good causes.


With around 80 kitchen ranges, our exclusive Lamona appliance brand, and thousands of products across joinery and hardware, learn why our builders have come to trust the range and quality of the products we offer.

People and Careers

The Sunday Times named Howdens as one of the top 25 big companies to work for. Discover why Howdens is a great place to work, how we develop our people and reward them, whilst building a culture with an entrepreneurial spirit.

Financial Results

Download copies of the latest financial results for Howdens both past and present including the associated presentations and Interim Management Statements released between results announcements.


Howdens is a responsible business which was founded on the tenet that the Company should be worthwhile for all concerned, with a commitment to the people within its reach and the wider world. Here we provide the links to the framework that informs our decisions and outcomes.