Annual report & review 2006 - Shopic.com

Our Chairman’s statement
WoRkING ToGeTheR
2006 has been a very important year for the Musgrave
Group. Our business performed well and continued to
grow at a steady pace in what was a very challenging
commercial climate.
The pressure to keep prices low for our retailers – while
the cost of doing business continued to fluctuate as a
result of an increasing payroll, energy and waste costs
– once again required innovation, good relations with
suppliers and a great deal of hard work.
As a business we believe the key requirement to giving
consumers what they want is to do things better, simpler
and cheaper. We have many examples where we and
our retailers are doing this – imaginative local product
sourcing, improving our supply chain and improving stock
management, to name but three.
In all our markets our retailers
continue to delight consumers by
focusing on a personal approach,
an excellent range, an enhanced
shopping experience.
It would be difficult to overstate the value of the
collaboration and trust that are the keys to our success.
Our retailers rightly expect a shared focus on meeting
consumers’ needs, having a clear way of working and
confidence that they have access to the knowledge,
expertise, distribution, support systems and economies
of scale they need for success in their businesses.
Our results suggest that we’re on the right track, but
we’re very much aware that there’s plenty more to do.
2006 saw Group sales of €4.6 billion – an increase
of 4.5 per cent on 2005. profit before taxation at
€81.0 million has increased by €10.1 million (14.2 per
cent) on the previous year. Net debt now stands
at €186.3 million and represents 60.3 per cent of
shareholders’ funds, compared with 134.4 per cent in
2005.
The full year dividend paid to shareholders was 26.1 cent
per share. This is an increase of five per cent over the
total dividend for 2005.
I want to thank all our people right across the business
who work so hard to deliver on our vision of a strong
independent retail sector serving local communities.
That major contribution was recognised this year when
we received an award in the Business Success category
of the JpMorgan Business Honours programme.
In particular, I’ve been extremely impressed with the
extent to which our teams have taken on board and then
advanced the important brand work that’s taken place in
the course of the year. This work has already helped us to
refocus and to look at new ways to improve our business.
Its implementation will deliver real value in the months
and years ahead.
hugh Mackeown
Chairman
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MuSGRAVe GROup pLC aNNuaL RepoRT & ReVIeW 2006