LONDON (Alliance News) - Northacre PLC Monday said it expects full-year revenue to drop by about GBP500,000, but also expects administrative expenses to fall by about seven times that amount.
In a trading update ahead of results for the year ended February 28, Northacre said it expects to report revenue in the region of GBP3.0 million, down from GBP3.5 million a year earlier, due to a reduction in Lancaster's related revenue earned by Intarya.
Administrative expenses are expected to fall to about GBP5.3 million, from GBP8.9 million, mainly due to the reduction in the bonuses paid in respect of the Lancasters development in the last financial year.
Northacre described its most recent financial year as one of transformation, with the company undergoing a change in majority ownership to Spadille, a vehicle controlled by Abu Dhabi Capital Management, the appointment of a new chief executive, and the appointment of ADCM Ltd as consultant.
The company has entered into two development management agreements for the development of two prime central London developments located at 1 Palace Street and 33 Thurloe Square.
Northacre said both projects are expected to make substantial contributions to revenues over the coming several years with development fees expected to exceed GBP11.0 million. In addition, Northacre said it is entitled to a performance fee as part of the development management agreements, and expects to benefit from returns on its minority equity investment in these projects.
Northacre said it's confident about future prospects, supported by its strengthened balance sheet after the recent fundraising that was underwritten by Spadille.
Northacre shares were Monday quoted at 67.00 pence, down 2.2%.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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