Interflora [IRDX RIFL] is to buy Flying Brands’ gift division, which includes its flagship Flying Flowers business, for a knockdown £2.4m. The sale of the loss-making division, which depends on shareholder and Office of Fair Trading approval, means Flying Brands will now concentrate on its gardening and bird supplies businesses.
Flying Brands, which sells both online and through catalogues, announced the sale today of a division made up of Flying Flowers, the business out of which Flying Brands originally grew, Flowers Direct and Drake Algar. The price represents a 25% discount on the July 2011 book value of the assets being sold, then put at £3.2m.
The sale comes after a year in which Flying Brands has issued a series of profits warnings. Its latest trading update, in January, showed sales fell by 24.9% in the final quarter of its financial year, which fell over the Christmas period and was a key selling quarter for its flowers business.
In today’s announcement Flying Brands said the gifts division turned in an operating loss of £0.8m in the year to December 31.
The money raised by the sale of the gifts division will be used as working capital for the business where the prime focuses are now its Gardening Direct and Garden Bird Supplies businesses.
In 2010 Flying Brands sold most of its entertainment businesses to focus on its gardening and gifts businesses. Late last year it also sold several properties. Today’s announcement sees the company go a step further, to concentrate on its gardening brands alone.
Flying Brands also said that its full-year results would now be reported in April rather than March, as originally planned.