Last checked at 1 May 2009 13:00
FLETCHER KING PLC
PRE-CLOSE TRADING UPDATE
Fletcher King plc (the "Company") today provides the following pre-close trading update as it enters its close period for the 12 months ending 30 April 2009.
As previously reported, conditions in the UK commercial property market have continued to be challenging. However, cost cutting measures taken previously have reduced the Company's overhead and cost base to a level suited to the current market climate.
Other trends highlighted in the interim results published on 23 December 2008 have continued and, as anticipated, in spite of the challenging market, the underlying continuing business has traded profitably in the year in question. We set out below a brief update on each division:
Fund management and investment - transaction business has continued to be significantly lower than in the previous year. The SHIPS Fund money is still held in cash and we are awaiting opportunities to deploy it where we see maximum value.
Asset management - despite the challenging markets, this division has succeeded in winning new mandates and generally maintaining income flow from existing portfolios.
Valuation and rating - the volume of valuation instruction has declined somewhat but rating appeals and settlements are continuing at similar levels as previously.
As announced on 22 December 2008, we disposed of the underperforming Howard building services division to its management for a nominal sum, with the inter-company loan due from Howard to the Company of approximately £180,000 being repayable. Losses incurred by this division in the year to 30 April 2009 have exceeded management expectations, and, although this will be a discontinued operation, its effect will be to move the Company into an overall loss for the year. In addition, the outstanding Howard debt held on the Company's balance sheet will be impaired, as will the investment the Company made in the SHIPS 04 Fund. In spite of this, the Company's balance sheet and cash position remain strong, and, overall, the directors believe the Company is well positioned to weather the current market conditions.
Enquiries:
Fletcher King plc
David Fletcher
Tel: 0207 493 8400
Dowgate Capital Advisers Limited
James Caithie
Tel: 020 7492 4777