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STANLEY GIBBONS Rare Stamps & Autographs. Interim Results - 2011 Investors Presentation August 2011. Contents. Pages 1. Financial Highlights 3-4 Operating Highlights 5-7 Outlook & Strategic Focus 8 Internet Development Update 9
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STANLEY GIBBONSRare Stamps & Autographs Interim Results - 2011 Investors Presentation August 2011 1
Contents Pages 1. Financial Highlights 3-4 • Operating Highlights 5-7 • Outlook & Strategic Focus 8 • Internet Development Update 9 • Management Team 10 Appendix I Income Statement 11 Appendix II Balance Sheet 12 Appendix III Cashflows 13-14 Appendix IV Contact Details 15 2
Financial Highlights • Sales up 25% with particularly strong performance from philatelic trading and retail operations • Strong performance from the Benham Group (acquired in September 2010 for £1.5m), contributing profits of £0.3m in the first half • Gross margin % down from 40.6% to 37.9%, impacted by higher level of trade sales in period and change in sales mix. Gross margins expected to improve in second half of year • Adjusted profit before tax, excluding exceptional charges, of £1.8m (2010: £1.6m), up 12% • Interim dividend increased by 11% to 2.50p • £0.9m of cash generated from operations (2010: £0.8m) despite an increased investment in stockholding of £0.9m since beginning of the year 4
Philatelic • Strong trade sales in period through building of mutually beneficial trading relationships • Development into Chinese rare stamp market generated £0.7m sales in period • Sales of £0.2m “fine used” penny blacks to the Chinese market • Retail sales from 399 Strand up 21%, benefiting from the refurbishment completed in April last year • Increased demand from investors seeking a means of diversifying, protecting and growing their wealth in a tangible asset 5
Publishing • Poor performance from Publishing division in period with a £0.03m (13%) drop in profit contribution, although compares to a strong prior period, which benefited from the London 2010 Stamp Exhibition • Exceptional costs incurred of £0.1m from rationalisation of Publishing division in first quarter, although generating future annual cost savings of £0.15m • Stronger publishing schedule for second half with key annual titles on course for publication ahead of schedule • Restructured team better focussed to deliver improved performance from implementation of strategic opportunities 6
Other Collectibles • Acquired specialist expertise to extend product offering into rare coins, commemorative medallions and military medals, with £0.4m sales of rare coins in the month of June • The Benham Group contributed sales of £1.4m (including £0.3m product sales into the Chinese market) and profits of £0.3m • Royal Wedding commemorative collectible sales lower than initially anticipated. Longer term benefits from recruitment of new clients for continuity programmes • Reduction in autograph sales to investors during period due to shift in marketing focus, together with a lack of suitable material coming onto the market 7
Outlook & Strategic Focus • Online trading platform scheduled for launch in late 2011 • Opening a new office in Hong Kong in September 2011 • Moving to larger premises in Jersey in August 2011 providing increased retail gallery space • Meetings scheduled with potential trading partners in the US in September • Continue to diversify our quality product offering into other collectibles including rare coins, commemorative medallions and military medals • Potential launch of rare stamp investment fund remains on agenda, although as a lower priority 8
Internet Development Update • New Fraser’s Autographs website, www.frasersautographs.com launched in February 2011 resulting in 13% increase in online sales compared to prior period • Principal components of primary website, www.stanleygibbons.com launched on 31 May with growth in sales and visitor numbers encouraging to date. Sales in the period under review were down 14% as a result of disruption to services during the web development process • Online trading platform scheduled for launch in late 2011 • Focus now on: • Ensuring we have appropriate e-infrastructure in place to react to the changing marketplace • Building our dedicated in-house e-commerce team to ensure we are adequately resourced to capitalise on recent technical developments • Developing relationships with clients of our e-commerce software providers and established e-commerce industry experts 9
Management Team • Key new managerial appointments in period: • Managing Director of Benham Group appointed as Business Development Director focussing, in the short term, on development of opportunities in China and the Far East • Head of Auctions • Publisher • Retail Manager, 399 Strand • Key appointments planned for the second half of 2011: • Head of E-commerce • Local manager for Hong Kong office 10
The Stanley Gibbons Group plc Stanley Gibbons (Jersey) Limited 18 Hill Street St. Helier, Jersey, JE2 4UA Tel: +44(0)1534 766711 Email: investment@stanleygibbons.com Stanley Gibbons (Guernsey) Limited 18 Le BordageSt. Peter Port, Guernsey, GY1 1DE Tel: +44(0)1481 708270 Email: investment@stanleygibbons.com Stanley Gibbons Limited399 StrandLondon, WC2R 0LXTel: +44(0)20 78368444 Email: info@stanleygibbons.com 7 Parkside, Christchurch RoadRingwood, Hampshire, BH24 3SH Tel: +44(0)1425 472363 Email: info@stanleygibbons.com www.stanleygibbons.com Appendix IV - Contact details 15