HMLH.L Regulatory News (HMLH)

HML Holdings plc

("HML", the "Company" or the "Group")

Final Results for the Year Ended 31 March 2015

HML Holdings plc (AIM: HMLH), the property management services Group, announces final results for the year ended 31 March 2015.

Financial and Operational Highlights:

*before interest, share based payment charges, amortisation and tax

**before interest, share based payment charges, depreciation, amortisation and tax

Commenting on the results, Rob Plumb, Chief Executive of HML Holdings said: "We are pleased to be reporting continuous revenues and earnings growth particularly during a time in which we are making investments in our systems and infrastructure. This investment enhances our confidence in our ability to continue providing both organic and acquisition led growth".

For further information:

CHAIRMAN & CHIEF EXECUTIVE REPORT

HML's earnings before interest, share based payments, amortisation and tax grew 13% to £1,535,000 (2014 £1,355,000). Profit after interest and tax improved 11% to £928,000 (2014: £836,000).

During the course of the year the Company purchased five property management businesses. Along with acquisitions from the previous year, they contributed £1.1m of the £2.5m increase in revenues. Overall the Group increased revenues by 17% (2014: 15%), of which 9% (2014: 10%) was due to organic growth. Residential property units under management grew 16% to 51,000. Acquisitions continue to be an intrinsic part of our growth plans both in terms of revenue and earnings improvements as well as geographical expansion. During the course of the year our acquisitions enabled us to establish satellite offices in Bath (in which we have subsequently merged with our Bristol business) as well as Romford in Essex and Eastbourne in Sussex.

A major contribution to revenues and earnings growth came from Alexander Bonhill, our insurance broker, which responded well to opportunities arising from the existing business as well as from the newly acquired businesses. Lettings management fees, which represent less than 5% of total revenues, grew by 34% as a result of the lettings portfolios within the acquisitions we made during the year. Lettings Management, mainly in the residential and mixed-use markets, is a growing and successful part of our expansion plans.

The Group continues to improve its share of the owner-occupied leasehold market with organic growth coming principally from client referrals and acquisitions whose portfolios' ownership profiles are similar to our own. New business from the new-build market is a growing proportion of our organic growth largely as a result of our wider geographical coverage.

The disparity in the service quality of property management businesses has continued to widen as we anticipated. This has been brought into closer focus as a result of the difference between those operators who have committed to the additional standards of ARMA (the Association of Residential Managing Agents) and those who operate without regulation. As of the 1st January 2015 only those businesses which have committed to ARMA's new standards and codes of conduct can be registered members of the association. We are pleased to report that all of HML's businesses received immediate accreditation under this new regime. Compliance with ARMA's standards, while relatively straight forward, has necessitated additional investment in our systems and processes infrastructure. This investment combined with the associated costs in support areas such as client communications and staff training has, to some extent, impacted operating costs. We remain confident however that this investment will be worthwhile given our increasingly discerning client base.

The Group continues to invest in Human Resource support which is of critical importance to a service provider as reliant, as we are, on the competencies and professionalism of our employees. The introduction of initiatives such as our Employee Engagement Survey, Employee Assistance Programme and a performance management system for all our employees will be of increasing value to the Group whose competitive advantages are so clearly determined by a motivated and trained group of employees. We are proud of the growing professionalism within the employee base and express our thanks for the contribution our employees have made to the Group's continued success.

We were pleased to announce that Elizabeth Holden has joined the board as a non-executive director with effect from 3rd June 2015. Elizabeth was formerly a partner at Slaughter and May working in mergers and acquisitions and is a non-executive director of Great Portland Estates, a FTSE 250 property company, and of Your Lifespace, the property development arm of Circle Housing Group. Her legal background combined with her experience in the property sector make her a valuable member of the HML group.

In 2014, the Company paid its maiden dividend. We are pleased to report that the Board has recommended that a dividend of 0.30p per share be paid in 2015 which reflects an increase in line with the Company's earnings growth.

Richard Smith (Chairman) Robert Plumb (Chief Executive)

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 March 2015

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY

For the year ended 31 March 2015

ATTRIBUTABLE TO THE EQUITY HOLDERS OF THE GROUP

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

31 March 2015

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 March 2015

NOTES TO THE ACCOUNTS

GENERAL INFORMATION

Whilst the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs.

The financial information is presented in pounds sterling, prepared on a historical cost basis, except for the revaluation of contingent considerations, unless otherwise stated, rounded to the nearest thousand. The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 31 March 2015 or 31 March 2014.

The financial information for the year ended 31 March 2014 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 statutory accounts for the year ended 31 March 2015 have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them. This preliminary announcement does not constitute statutory accounts under section 435 of the Companies Act 2006.

HML Holdings plc and its subsidiaries specifically focus on residential property management. The Group operates in the UK. The Company is a public limited company incorporated and domiciled in the United Kingdom. The address of its registered office is 9-11 The Quadrant, Richmond, Surrey, TW9 1BP. The Company is listed on the AIM stock exchange.

The preliminary results were authorised for issue by the board of directors on 17 June 2015.

1. PROFIT RECONCILIATION

The reconciliation set out below provides additional information to enable the reader to reconcile to the numbers discussed in the Chairman's and Chief Executive's report

Direct operating expenses and central operating overheads include depreciation and staff costs.

Set out below is an analysis of other operating expenses;

Amounts payable to the auditor and its related entities in respect of both audit and non-audit services are set out below:

The tax assessed for the period is lower than the standard rate of corporation tax in the UK of 21% (2014: 23%). The differences are explained below:

Future tax charges may be affected by the fact that no deferred tax asset is recognised in respect of losses carried forward by HML Hathaways Limited. Deferred tax assets are not recognised until the utilisation of the losses is probable. The Group has losses carried forward in its subsidiary, HML Hathaways Limited which can be recovered against future profits arising from the same trade. The total tax losses carried forward to future years are £1,243,000 (2014: £1,243,000). The unprovided deferred tax asset in respect of these losses is £249,000 (2014: £249,000).

4. EARNINGS PER SHARE

The calculation of the basic and diluted earnings per share is based on the following data

The diluted earnings per share are the basic earnings per share adjusted for the dilutive effect of the conversion into fully paid shares of the outstanding share options.

On 28 May 2014, HML Andertons Ltd purchased the trade and assets of Alan Foster & Associates, a business based in Guildford, Surrey. The acquisition was integrated in the Aldershot office and reinforces HML Andertons Ltd position as the leading property manager in the area.

The fair value of net assets acquired are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the business.

On 25 June 2014, HML Hawksworth Ltd purchased 100% of the share capital of PG Ashton Property Management Company Limited (PGAPMCL). The acquisition gives HML Hawksworth Limited a presence in the North East London/Essex area.

The fair value of net assets acquired are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the business.

On 17 July 2014, HML Andertons Ltd purchased the trade and assets of Chilton Estate Management, a property management business based in Bath. The acquisition will reinforce HML Andertons Ltd position as one of the leading property managers in the area.

The fair value of net assets acquired are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the business.

On 4 January 2015, HML Hathaways Limited purchased AMP MGMT Limited, a property management business based in London and Eastbourne. The trade of AMP MGMT Limited has been absorbed into the North London office and has helped the critical mass of the office.

The fair value of net assets acquired are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the business.

On 28 February 2015, HML Hathaways Limited purchased Qualitas, a property management business based in Watford. The trade has been transferred to the North London office and helps establish the office in the Hertfordshire area.

The fair value of net assets acquired are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the business.

7. DIVIDEND

The Board has recommended an increase in the final dividend to 0.30 pence (2014: 0.27 pence), an increase of 11%.

Subject to shareholder approval at the Annual General Meeting, the final dividend will be paid on 15th October 2015 to qualifying shareholders on the Register at the close of business on 2nd October 2015. The ordinary shares ex-dividend date is 1st October 2015.