HMLH.L Regulatory News (HMLH)

12 Nov 2009 07:00



HML HOLDINGS Plc

("HML" or "the Group")

INTERIM RESULTS

HML Holdings plc (AIM: HMLH.L), the property management service group, today announces its interim results for the six months to 30 September 2009.

Highlights for the six month period:

Underlying 12% (2008: 6%) growth in core management fees

Net cash from operating activities increased to £451,000 (2008: £2,000) 

Insurance revenues grew to £404,000 (2008: £375,000)

Commenting on the results, Robert Plumb, Chief Executive of HML Holdings Plc, said: 

"It is very pleasing to again report a growth in both revenue and base management fees, with core management revenues having grown at a rate of four times that of our operating expenses. With improving market conditions, a growing client base, and a resilient business model in place, the Board looks to the future with optimism."

For further information:

CHAIRMAN AND CHIEF EXECUTIVE'S REPORT

We are pleased to report a positive first half of the year, with revenues growing to £4,422,000, representing a 2% (£76,000) increase over the period. This growth was underpinned by a 12% or £262,000 increase in recurring management fees. The net revenue growth of only 2% highlights the degree to which some of our other income has been impacted by market conditions. The most significant reduction in supporting income is as a result of a marked decrease in treasury management fees which is a direct consequence of the low interest rate environment.

It is however, pleasing to report that surveying fees have stabilised and insurance income has continued to improve. Other contributors to ancillary income are more reliant on property transactions and therefore impacted by the economic slowdown. Notably, sales of legal and accounting information packs are lower than the equivalent period last year and have been affected by the very low transactional levels in the residential property market. 

Although profit before interest, share based payment charges, amortisation and taxation has decreased to £151,000 (2008: £204,000), we are pleased to be able to report that core management revenues have grown at a rate of four times that of our operating expenses. We believe this is a creditable reflection of the positive reaction our staff have had to a challenging operating environment. Net cash from operating activities has grown to £451,000 (2008: £2,000).

The Group remains active in terms of new management business tenders and has continued to grow organically. The well published deterioration in new build residential development has had a major negative effect on market growth. Offsetting this for the HML group is the effect of an increasingly demanding, knowledgeable and selective residential customer. The Board believes that new business opportunities will continue to grow as service becomes increasingly a differentiating factor. 

The absence of transactional activity in the broader property services sector inevitably creates some downward pressure on management fees in some areas of the market. Organisations which formerly focused on residential or commercial property sales have, to some extent, turned their attentions to the more resilient management sector. However the barriers to entry, particularly in the block management area, continue to grow in this increasingly regulated and automated sector. The degree to which consistency, quality and scale aid service delivery provides HML with growing confidence in its business model. It is our belief that HML is well placed to capitalise upon improving market conditions and the Board looks forward with continued optimism.

HML HOLDINGS Plc 

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Six months ended 30 September 2009

Profit before interest, exceptional items, share based payments charges, amortisation and taxation reconciliation

HML HOLDINGS Plc 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Six months ended 30 September 2009

HML HOLDINGS Plc 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Six months ended 30 September 2009

HML HOLDINGS Plc 

CONSOLIDATED STATEMENT OF CASH FLOWS

Six months ended 30 September 2009

HML HOLDINGS Plc 

NOTES TO THE ACCOUNTS

1. General Information

The interim unaudited financial information was approved by the board on 11November 2009.

The results for the year ended 31 March 2009 have been audited whilst the results for the six months ended 30 September 2008 and 30 September 2009 are unaudited. The financial information contained in this interim report does not constitute statutory accounts for that period. The statutory accounts for the previous year, which were prepared under IFRS, have been delivered to the Registrar of Companies. The auditors' opinion on those accounts was unqualified and did not contain a statement under section 237 (2) or (3) of the Companies Act 1985.

Copies of the interim report are available from www.hmlholdings.com or from the Company Secretary at HML Holdings plc, 9-11 The Quadrant, Richmond, Surrey, TW9 1BP.

2. International Financial Reporting Standards

The consolidated financial information has been prepared using accounting policies consistent with International Financial Reporting Standards ('IFRS') as adopted by the European Union applied in accordance with the provisions of the Companies Act 2006.

Except as described below, the accounting policies applied are consistent with those of the audited annual financial statements for the year ended 31 March 2009.

The presentation of the primary financial statements has been modified in order to comply with IAS 1 (revised). However the revised standard has no impact on the reported results or financial position of the group.

Whilst the financial figures included in this interim report have been computed in accordance with IFRS, this interim report does not contain sufficient information to constitute an interim financial report as that term is defined in IAS 34.

3. Taxation

Taxation for the six months to 30 September 2009 is based on the effective rate of taxation which is estimated to apply for the year ending 31 March 2010.