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Discover Leisure

  • BY: Andrew Hore |
  • POSTED: 04/01/2009 |

Discover Leisure has agreed new bank facilities.

The caravans and motor homes retailer has agreed more flexible covenants with Nat West Bank, which is its main bank. However, if trading declines this could still put pressure on the business. Discover is trying to reduce its caravan stocks.

Net debt doubled to £22.6m by the end of August 2008. Nearly half of that is repayable on demand. The inventory funding comes from Bank of Scotland.

Acquisitions helped Discover increase its revenues 150% to £136m in the year to August 2008. More than 9,000 new and used vehicles were sold during the year. The loss increased from £571,000 to £3.73m. Restructuring costs more than doubled from £515,000 to £1.13m. Provisions relating to caravan stocks totalled £2.1m, while there were bad debt provisions of £1.1m.

Discover lost £1.8m on revenues of £51.8m in the six months to the beginning of March 2008.

Since the year end Discover has closed its Cardiff site. The number of employees has been cut from 657 to 520. These actions will cost another £300,000 this year but they should save £2m a year.

Discover expects 2009 to be tough. The first half is quieter so it will be some time before there is any firm indication that trading is improving.

At 0.48p a share, Discover is valued at £740,000.

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