DJAN.L Regulatory News (DJAN)

6 July 2016

DAEJAN HOLDINGS PLC

UNAUDITED PRELIMINARY RESULTS ANNOUNCEMENT for the year ended 31 March 2016

The Chairman, Mr B S E Freshwater, today announced Preliminary Results for the year to 31 March 2016.

The financial highlights for the year ended 31 March 2016 are as follows:

The revaluation of the investment property portfolio at the year end has resulted in a net valuation surplus for the year of £117,947,000 (2015 - £229,722,000). The board has recommended a final dividend of 58p per share in respect of the year ended 31 March 2016 payable on 11 November 2016 to shareholders on the register on 14 October 2016. This will make a total dividend for the year of 93p (2015 - 88p).

Earnings per share is calculated by reference to profit on ordinary activities after taxation attributable to equity holders of the parent of £142,900,000 (2015 - £227,395,000) and 16,295,357 (2015 - 16,295,357) ordinary shares being the weighted average number of ordinary shares in issue during the year.

DAEJAN HOLDINGS PLC

CONSOLIDATED INCOME STATEMENT

FOR THE YEAR ENDED 31 MARCH 2016

DAEJAN HOLDINGS PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31 MARCH 2016

DAEJAN HOLDINGS PLC

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31 MARCH 2016

DAEJAN HOLDINGS PLC

CONSOLIDATED BALANCE SHEET AS AT 31 MARCH 2016

DAEJAN HOLDINGS PLC

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31 MARCH 2016

DAEJAN HOLDINGS PLC

Notes

1. The financial information set out in this Preliminary Announcement does not constitute the Company's statutory accounts for the years ended 31 March 2016 or 2015. The financial information for 2015 is derived from the statutory accounts for 2015 which have been delivered to the Registrar of Companies, except as set out below. The Auditors have reported on the 2015 accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under Section 498(2) or (3) of the Companies Act 2006. The statutory accounts for 2016 will be finalised on the basis of the financial information presented by the Directors in this Preliminary Announcement and using policies consistent in all material respects with the policies applied in the Company's statutory accounts for 2015, as set out in those accounts as delivered to the Registrar of Companies, except as set out below. The statutory accounts for 2016 will be delivered to the Registrar of Companies following the Company's next Annual General Meeting.

2. During the year ended 31 March 2016 the Group changed its accounting policy for loans and borrowings. Prior to the change, the Group initially recognised and subsequently recorded fixed rate loans and borrowings at fair value. Following the change, the Group will continue to initially recognise loans and borrowings at fair value, but will subsequently record them at amortised cost.

The Directors believe that the change in accounting policy will be beneficial to users of the financial statements as most, if not all, other large property investment companies in the United Kingdom have adopted this policy. This will provide more reliable and relevant comparisons between the Group's financial position and results with that of other property investment companies.

To maintain consistency between reporting periods, the Group has applied this change retrospectively. The Group has therefore adjusted the comparative figures for the year ended 31 March 2015 so that these figures are presented as if the change in accounting policy had always applied.

The impact of the change in policy affects the carrying value of loans and borrowings, the fair value of gains and losses recognised and the associated deferred tax credits and assets.

Loans and borrowings cumulatively decreased by £18,380,000 at 31 March 2015 and by £11,679,000 at 1 April 2014. Deferred tax assets cumulatively decreased by £6,155,000 at 31 March 2015 and by £4,614,000 at 1 April 2014. The translation reserve cumulatively decreased by £39,000 at 31 March 2015 and by £644,000 at 1 April 2014. Retained earnings cumulatively increased by £12,264,000 at 31 March 2015 and by £7,709,000 at 1 April 2014.

The fair value losses on fixed rate loans and borrowings recognised in the consolidated income statement were eliminated in each period. The impact was a gain of £5,599,000 for the year ended 31 March 2015. The income tax charge increased by £1,045,000 for the year ended 31 March 2015.

Basic and diluted earnings per share increased by 27 pence for the year ended 31 March 2015.

3. Segmental Analysis

4. Significant judgements and estimates

In preparing the financial information the Group must make a number of judgements and estimates. Management consider the following judgements and estimates to be particularly significant because of the level of complexity, judgement or estimation involved in their application and their impact on the financial information.

i. Property valuations

The valuation of the Group's property portfolio is inherently subjective, depending on many factors, including the individual nature of each property, its location and expected future net rental values, market yields and comparable market transactions. Therefore the valuations are subject to a degree of uncertainty and are made on the basis of assumptions which may not prove to be accurate, particularly in periods of difficult market or economic conditions following the EU Referendum. All the Group's properties are valued by external valuers with appropriate qualifications and experience.

In the UK the aggregate amount of the valuation is £1,532,817,000 at 31 March 2016 and in the US the aggregate amount of the valuation is £487,872,000 at 31 March 2016. Both are based on the open market values assessed in accordance with professional standards. The aggregate professional valuations included in the balance sheet have been reduced by an amount of £11,328,000 relating to lease incentives included in Trade and other receivables.

ii. Income taxes

The tax treatment of some transactions and calculations cannot be determined until a formal resolution has been reached with the relevant tax authorities. In such cases, a best estimate of the relevant tax charge or credit is made, having regard to the extent of uncertainties associated with it. Where the final outcome of such matters is different from amounts initially recorded, those differences will be reflected in the income and deferred tax amounts at the time of the formal resolution.

Additionally, judgement has been exercised in relation to the recognition of deferred tax assets where the utilisation of the underlying tax losses is uncertain. Such resolution can take a long time to achieve due to the complexity of tax legislation.

5. The Annual General Meeting will be held at 2:00 pm on Tuesday 13 September 2016 in The Grand Saloon, Theatre Royal, Drury Lane, Catherine Street, London WC2B 5JF.

For further information call:

Mark Jenner

Company Secretary

Daejan Holdings PLC

020 7836 1555

Nick Oborne

Weber Shandwick Financial

020 7067 0700