Artisanal Sp.co Regulatory News (ART)

18 Jan 2008 14:33

Artisan (UK) PLC18 January 2008 This is an amendment to the announcement issued at 13.22 on 18 January 2008under RNS number 0990M in which the third line should have read "six months to31 December 2007" not "31 December 2008". The rest of the announcement remainsunchanged. Please see below the correct version of the announcement. Artisan (UK) plc Trading Update Artisan (UK) plc ("Artisan" or "the Group"), the residential house builder andcommercial business park developer, today issues the following trading updateahead of the Group's interim results for the six months to 31 December 2007. Artisan's expectation for the current year has always been weighted towards thesecond half, but the first half of the year has proved more challenging thanexpected. We are pleased with the performance that Rippon Homes has achieved inthe first half. Whilst sales units in that division are slightly lower thanexpected, individual site margins have remained reasonable. However over thedivision margins have been impacted by fixed marketing spend levels across thelower volumes. The Group is confident that these hard won sales have beenachieved as a result of the superior quality of the product offering and theability of local management to maintain an effective part exchange programme,and that they bear comparison with the best of our local competition. Ourunderlying belief is that, despite the unfavourable economic conditions and thechallenging markets, consumer demand exists but is currently constrained byuncertainty and the difficult credit supply conditions of the market. The commercial business park division's ability to complete deals has beenimpacted by the tightening of credit supply. Investors with funding arereluctant to commit whilst the market is uncertain and the Group has seenprospective deals fail because of customers losing their funding. Consequently,whilst there has been good progress with previously contracted sales, new salescompletions have been disappointing, both of stock items and new forward sales.Once again inherent demand for the product remains but economic conditions arerestricting the current sales opportunities. Artisan (UK) Properties, the investment division, has made excellent progresstowards delivering the first two investment properties to their occupiers. Thefirst building occupied by Speymill Group plc and also by Artisan (UK) plc wascompleted and occupied in December 2007. The larger building for let to BlackTeknigas is making comfortable progress towards the agreed January completiondate. The economic conditions have also had an impact on this division, andcurrent property yield rates have moved out and affected the valuation of theseproperties. Whilst we have maintained the valuation on one unit the other isreduced by approximately one quarter percent greater yield percent thanestimated earlier in 2007. We expect there to be at least some compensation inbuild cost savings and the overall revaluation surplus not materially changed. A misplaced attempt to reopen litigation against Artisan was comprehensivelyrejected by the High Court. Artisan welcomes this deserved decision by thecourt. The Group has also taken active steps to balance land acquisition against areduced sales expectation and a strong cash position is being maintained.However, due to tighter than anticipated trading conditions for the first halfof the year, Artisan now requires an exceptional performance in the second halfif the Group is to meet market expectations for the year. Whilst feasible, itwill require improved buoyancy in the market. Further interest cuts are neededto generate market confidence. In the meantime we shall pursue carefullyconsidered sales strategies appropriate to each site and concentrate onidentifying medium to longer term land opportunities. Artisan (UK) plc Chief Executive 01480 436666Chris Musselle email@artisan-plc.co.uk Brewin Dolphin Securities Limited Nominated advisers 0845 270 8613Andrew Kitchingman Bankside Consultants Financial PR advisers 020 7367 8888Simon Rothschild 07703 167065Louise Mason Company website: www.artisan-plc.co.uk This information is provided by RNS The company news service from the London Stock Exchange