Half Year 2024 Trading Statement

You will have seen in the press that spring and early summer this year featured unusually cool, wet weather. This produced a poor trading season for plants, gardening and garden furniture, which is reflected in our performance. We did much better in other categories, in particular fashion and the restaurants which both performed strongly.

Overall sales increased by 4.8%, with garden centers +2.7% and restaurants +15.9%; within garden centers we are seeing double digit growth in fashion and food, with fashion on track to overtake garden furniture as our 4th biggest division by the end of the year.

Sales continue to outperform both the HTA and GCA market reads. Our like-for-like sales declined by 0.1%, but were 3.9% ahead of the market as measured by the GCA, with customer numbers +1.1% ahead and basket spend +2.8%.

Stock has been well managed in the half, reducing by 2.9% year-on-year despite slower than expected sales. Cashflow remains strong in the group and as a result we exited the half with a Net Debt to EBITDA ratio of 0.8.

Shortly after the period end, we acquired Frosts Garden Centre in Woburn, just outside Milton Keynes. This is another long-established and successful business, catering to a customer group very similar to Blue Diamond’s. There is very little overlap with the catchments of our other centres in the area. Current turnover is £11m and we plan to grow this to £12.5m, mainly by introducing Blue Diamond ranges and merchandising to the site. The property is technically a leasehold, but with a very low rent and a lease with over 100 years to run, so more akin to a ground rent arrangement. The price paid was £13.5m plus stock.

We are planning the acquisition of a smaller garden centre, affiliated to Frosts, at Willington in east Bedfordshire, later in the year.

Our refurbishment and upgrade programme continued as planned during the first half, with significant refurbishments at Canterbury, Cardiff and Beckworth, and restaurant upgrades at Chenies and Hereford. We are curtailing this activity in the second half in order to manage debt levels following the Frosts acquisition.

Chairman Simon Burke commented, ‘There is no doubt that this was a disappointing season for us and for the industry. We also saw some significant cost increases, especially the large increase in National Living Wage in April, and so it is likely that our first half profit will be below last year’s. However with the change in weather in July we have enjoyed some strong trading, and with a cost management programme in hand, we expect to do better in the second half.  The Christmas season is much less dependent on weather and we have a strong offer lined up.'

A note on the recent share split:

As agreed at the AGM we executed a 5:1 share split in June. Any additional shares issued prior to the AGM (including those issued pursuant to the Scrip Dividend Alternative) were also split on the same basis.

Holders of existing shares immediately before the AGM are now the holders of 5 times as many new shares, but these holdings represent the same proportion of the Company's issued share capital as their holdings of existing shares immediately before the Share Split.

Certificates for the new shares will not be issued to Shareholders as a matter of course. All records are held digitally on the TISE platform. Shareholders may request a new share certificate from the Company in accordance with the Articles.

Yours sincerely,

Simon Burke

Chairman