Fletcher King Regulatory News (FLK)

FLETCHER KING PLC

Audited results for the Year Ending 30 April 2022

Highlights

· Revenue for the year of £2,967,000 (2021: £2,264,000)

· Statutory profit before tax of £134,000 (2021: loss of £834,000)

· Adjusted profit before tax of £144,000 (2021: loss of £935,000) *

· Adjusted basic earnings per share of 1.73p (2020: loss of 8.57p) *

· Final proposed dividend: 0.50p per share (2021: £nil)

· Significant cash reserves: £3.4m as at 30 April 2022 (2021: £2.9m)

*Adjusted results are before share based payment expenses and after other comprehensive income (see note 2).

The Annual Report and Accounts will shortly be posted on the Company's website and a further announcement will be made when the document is sent to shareholders.

Commenting on the results, David Fletcher, chairman of Fletcher King Plc said:

"The results for the year are a significant improvement from last year and we are pleased to be able to commence dividend payments again. We have started the new financial year with some encouraging instructions and are optimistic that we can continue our growth pattern".

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

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HAIRMAN'S STATEMENT

Results

Revenue for the year was £2,967,000 (2021: £2,264,000). Adjusted profit before tax (see note 2) was £144,000 (2021: loss of £935,000). Statutory profit before tax was £134,000 (2021: loss of £834,000).

The Board considers the adjusted results to be an important measure of performance and to be more representative of performance for the year than the statutory results (which have been prepared in accordance with International Financial Reporting Standards).

Dividend

The Board is proposing a final dividend of 0.5p per share. The final dividend is subject to shareholder approval at the AGM and will be paid on 28 October 2022 to shareholders on the register at the close of business on 30 September 2022. The ex-dividend date for this payment is 29 September 2022. With no interim dividend paid (2021: £nil per share) the dividend for this year will amount to 0.5p per share (2021: £nil per share).

The Commercial Property Market

It was encouraging that both the letting and capital markets were considerably more buoyant than the previous year.

The impact of Covid on the market has now largely disappeared although numbers back to the office have not yet returned to pre pandemic levels. However no sooner has one world problem diminished than another takes its place in the form of the tragic war in Ukraine and its impact on all economies throughout the world.

Despite the continuing levels of uncertainty, the industrial property market continued to perform exceptionally well with rents growing and capital values powering ahead. Over the year, according to MSCI data, total returns in the sector produced an astonishing 42% which compared to retail at 6% and offices at 6.7%.

High Street retail continues to be difficult but interestingly the office sector, in both London and major cities throughout the country, is showing strong tenant demand for prime space with potential under supply in some locations.

Business Overview

As seen from the figures above, the market was significantly better than the previous year but it was not without its ups and downs and a significant level of uncertainty remains in predicting future outcomes.

Property and Fund Management had a strong year. Despite the challenges of the pandemic, we continued to produce excellent rent collection statistics. We remodelled parts of the portfolios and acquired new clients during the year. Our continued robust performance has fostered long client relationships some of which have been in existence for over fifty years.

Bank Valuations showed a marked improvement compared to the previous year and there has been a steady flow of instructions from lenders for whom we have not previously acted.

Income from rating appeals was negligible, reflecting a disappointingly low number of appeals settled with the Valuation Office. Hopefully the backlog of appeals will be addressed by the Valuation Office and we can benefit from the significant pipeline of appeals submitted on behalf of our clients.

As announced on 4 March 2022, and after a delay in receiving FCA approval, the transaction completed whereby C M Strategic 613 Limited (an investment company of Elliott Bernerd) acquired a 29.99% shareholding in the Company.

Our move to new offices in Soho went well and both staff and clients are happy with our new location. We are using our new space more efficiently and there has been a material reduction in our property overhead.

Outlook

The uncertainties mentioned above together with rising interest rates, inflationary pressures and forecast recession are likely to have a continuing impact on all markets in which the company operates and will affect our ability to accurately forecast the future. However, we are optimistic about our performance for the coming year and we have started it with some excellent sales instructions as well as client funds available to invest in suitable propositions. Our management portfolios are likely to grow both organically and from appointments to advise new clients.

We anticipate the volume of valuations will increase during the year and hopefully this will be the year when we return to activity in agreeing rating appeals.

Importantly we hope our new significant shareholder will in due course become the source of additional income streams and we await to see the progression of this during the year.

Our balance sheet and cash reserves remain strong and have been of immense importance during the difficult times we have experienced over the last two years.

Once again, on behalf of all at Fletcher King I would like to thank our loyal clients for their continued support. On behalf of the Board, I also congratulate our outstanding staff for their foresight, expertise, dedication and hard work which is ultimately why our clients appoint us.

DAVID FLETCHER

CHAIRMAN

30 August 2022

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 30 April 2022

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 30 April 2022

CONSOLIDATED STATEMENT OF CASH FLOWS

for the year ended 30 April 2022

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 April 2022

 NOTES

1. General information

Whilst the financial information included in this preliminary announcement has been prepared in accordance with UK-adopted international accounting standards, this announcement does not itself contain sufficient information to comply with IFRSs.

The financial information is presented in pounds sterling rounded to the nearest thousand, and prepared in accordance with UK-adopted international accounting standards and under the historical cost convention, except for the revaluation of certain financial assets. The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 30 April 2022 or 30 April 2021.

The financial information for the year ended 30 April 2021 is derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a statement under either Section 498 (2) or Section 498 (3) of the Companies Act 2006 and did not include references to any matters to which the auditor drew attention by way of emphasis.

The financial information for the year ended 30 April 2022 is derived from the audited statutory accounts for the year ended 30 April 2022 on which the auditors have given an unqualified report, that did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006 and did not include references to any matters to which the auditors drew attention by way of emphasis. The statutory accounts will be delivered to the Registrar of Companies following the Company's annual general meeting.

2. Alternative performance measures - profit/(loss) reconciliation

The reconciliation set out below provides additional information to enable the reader to reconcile to the numbers discussed in the Chairman's Statement and Highlights section.

The fair value loss on financial assets in the prior year represents the unrealised loss in the year on the revaluation of the Group's interest in the SHIPS 16 syndicate.

3. Dividends

4. Earnings per share

Forward Looking Statements

Certain statements in this announcement are forward-looking statements relating to the Company's operations, performance and financial position based on current expectations of, and assumptions and forecasts made by, management. They are subject to a number of risks, uncertainties and other factors which could cause actual results, performance or achievements of the Company to differ materially from any outcomes or results expressed or implied by such forward-looking statements. Undue reliance should not be placed on such forward looking statements. They are made only as of the date of this announcement and no representation, assurance, guarantee or warranty is given in relation to them including as to their accuracy, completeness, or the basis on which they are made.

END