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Minutes of the 2016 Annual General Meeting of Blue Diamond Ltd held in the Fred Bell Lecture Theatre at Le Friquet Garden Centre, Guernsey on 16th June 2016.

Minutes

Mr Simon Burke (SB) welcomed shareholders to the meeting and handed over to Mr Alan Roper (AR) to make a presentation.

AR reported that 2015 was good year thanks to strong trade, the acquisition of Newbridge and an improving margin as the Group built scale. The Group had acquired Harlow Garden Centre in May 2016, which had the right demographic nearby and would become a destination garden centre for North London. Trade had been slow in the first four months of 2016 but had exploded in May and had continued into June. Blue Diamond (BD) was performing ahead of the industry. AR was confident about the prospects for 2016. Trentham and Springfields had been redeveloped to the Redfields standard and Derby would follow in July 2016 and St. Peters in January 2017.

SB invited questions from shareholders.

Mr David Warr (DW) congratulated the Board on an excellent year. He wanted to know how the industry would change when Dobbies was sold and what the Board's plans were for gearing levels in the coming years. AR expected there to be no short term impact because there was no geographical overlap between BD and Dobbies, and they are targeting a different demographic, but the competitive impact would be monitored closely. Richard Hemans (RH) told the meeting the Board monitored gearing levels based on net debt as a percentage of shareholders' funds, which it had committed to maintaining below 50% at the end of each financial year. However, the Board's preferred measure of leverage was Net debt to EBITDA, which was NatWest's metric and was a better indicator of the Group's ability to take on debt and to repay that debt. The Board had a year-end target of 3 times EBITDA.

Mrs Ann Dorey asked about the future plans for Wilton Garden Centre. AR replied that the landlord had applied for planning permission for a new restaurant and we were awaiting the outcome. In the meantime, the roof was scheduled to be replaced on the garden centre this Summer.

Mr Piers Proctor commented that the front of Le Friquet looked untidy, asked what the plans were to maximise the use of the land on the site and that he had heard negative reports about Le Friquet Restaurant. AR promised to inspect the front himself, reported that the old restaurant building was about to be redeveloped and spoke highly of the new restaurant manager at Le Friquet who had recently started.

Sir Geoffrey Rowland (GR) asked if the Board had considered a share split. SB replied that the Board had considered it and would investigate it further if it felt shareholders would benefit.

Mr Richard Brache (RB) asked that given the share price now exceeds book value, more information is being made publicly available on the Group and directors no longer have first refusal on the purchase of shares, whether there was an intention for the Company to go public. SB stated clearly there was no intention to make BD a public company. The role of the Board is to get the best returns for shareholders and it feels this can be best achieved currently as a private company. RB wants shares to trade freely and there are still restrictions. SB said there was no guarantee a flotation would create shareholder value, but it was not felt necessary for now although it was always an option.

Miss Pat Merriman (PM) asked if there had been a change to the tax status of the Company given the change of registered office. PM had seen this on recent correspondence. RH replied there had been no change to the registered office or the Company's tax status and he would look into the recent correspondence that may have created this false impression.

Mr John Martin asked about the future for Olympus (Guernsey) in the light of the closure of Olympus (Jersey). AR said the future of this store is linked to the retirement plans of the manager and it is unlikely to continue trading beyond his retirement in 5 or so years' time.

SB then moved to the formal items on the agenda.



Minutes of the 2015 AGM
These were approved.


Report and Accounts
To receive and adopt the Directors' Report and the Annual Report and Accounts for the year ended 31 December 2015, together with the Report of the Auditors. These were approved. To approve the final dividend of 16p per share. This was approved.


Election, Re-Election and Fees of Directors

To elect Mrs Patricia Alford-Burnett as a director and to approve the director's fees of £30,000 per annum. SB thanked Peter Atkinson for his significant contribution to the Board over the last 24 years and welcomed his successor Patricia. Patricia's appointment was approved.

To re-elect Mr Stuart Falla as a director. This was approved.



Auditors
To approve the re-appointment of BDO Limited as auditors. This was approved.


Special Resolution
To approve by way of special resolution the amendment of the articles of incorporation of the Company by replacing the words in Article 40 in their entirety with: "40. A share offered in a transfer notice shall be offered to the members who have notified the secretary that they are interested in the purchase of any shares that may become available." RB asked how the trading in shares would work in practice following the removal of the directors' first refusal on shares that come up for sale. GR suggested a formal process should be documented, which RH agreed to produce. Mr Geoff Dorey stated that as the shareholder with the largest shareholding he felt the Company should remain a private, Guernsey-based business. Mr Ian Dorey asked that existing shareholders who wish to sell their shares be borne in mind before issuing new shares. The resolution was approved.


Any Other Business

None.

SB declared the meeting closed.

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