Last checked at 30 Nov 2010 09:00
Chairman's Statement
On the following pages are the unaudited Accounts for the six months ended 30 September 2010. Revenue is down by only 4% whereas earnings per share are down by nearly 8.5%. This is explained almost entirely by the increase in finance and administrative costs.
The new government has been in office for six months and much has been said about cuts in government spending and increases in taxation. Apart from the increase in value added tax to 20% from the beginning of January the finer detail of most of the other measures has yet to be published. It appears that the impact of these measures will be in 2011/2012 and subsequent financial years and so it is reasonable to believe that the second half of the company's financial year can be as good as the first half.
Inflation is now above 3% and this may necessitate the raising of base rate and it is still difficult for first time buyers to get mortgages and therefore trading conditions could be difficult during 2011. Nevertheless the further repayment of nearly £10 million of borrowings over the last six months has put the company in a strong financial position with about £40 million available to invest and we hope to take advantage of good purchasing opportunities during the next eighteen months thus ensuring good profits in years to come.
Jacqueline Murphy resigned as a director and left the company as at 31 August 2010. It is never the right time for a valued employee to depart but it does give an ideal opportunity for the company to review its procedures and introduce any desired changes.
With effect from 1 November 2010 Alistair Sinclair has been appointed a non-executive director of the company. Alistair is the son of the late Frank Sinclair, who co-founded the company, and his 34 years of experience in the banking industry will provide an invaluable contribution to the company.
The interim dividend is maintained at 50 pence per share and will be payable on 28 March 2011 to shareholders on the register at 25 February 2011.
GROUP INCOME STATEMENT (UNAUDITED)
Half year ended 30.09.2010 £000 | Half year ended 30.09.2009 £000 | Year ended 31.03.2010 £000 | |
Revenue | 24,265 | 25,274 | 56,697 |
Cost of Sales | (9,091) | (9,382) | (22,191) |
Gross Profit | 15,174 | 15,892 | 34,506 |
Administrative expenses | (1,782) | (1,487) | (4,046) |
Operating profit before changes in | |||
fair value of investment properties | 13,392 | 14,405 | 30,460 |
Increase in fair value of investments | - | - | 2,142 |
| |||
Profit from operations | 13,392 | 14,405 | 32,602 |
Net finance costs | (1,751) | (1,560) | (3,347) |
Profit before taxation | 11,641 | 12,845 | 29,255 |
| |||
Taxation - current | (3,604) | (3,700) | (7,969) |
Taxation - deferred | 443 | 112 | 349 |
| |||
Taxation | (3,161) | (3,588) | (7,620) |
| |||
Profit attributable to equity shareholders | 8,480 | 9,257 | 21,635 |
| |||
Basic and diluted earnings per share (pence) | 217.5p | 237.4p | 554.8p |
All items within the consolidated income statement relate to continuing operations.
GROUP STATEMENT OF FINANCIAL POSITION (UNAUDITED)
As at | As at | As at | |
30.09.2010 | 30.09.2009 | 31.03.2010 | |
£000 | £000 | £000 | |
Assets | |||
Non-current assets | |||
Property plant and equipment | 2,453 | 2,499 | 2,422 |
Investment properties | 32,348 | 31,916 | 32,872 |
34,801 | 34,415 | 35,294 | |
Current assets | |||
Inventories of trading properties | 252,966 | 263,254 | 256,964 |
Trade and other receivables | 1,738 | 881 | 1,197 |
Cash and cash equivalents | 115 | 238 | 443 |
254,819 | 264,373 | 258,604 | |
| |||
Total assets | 289,620 | 298,788 | 293,898 |
| |||
Equity and liabilities | |||
| |||
Capital and reserves attributable | |||
to equity holders of the company | |||
| |||
Share capital | 195 | 195 | 195 |
Capital redemption reserve | 55 | 55 | 55 |
Capital reserve | 25 | 25 | 25 |
Other reserve | 56 | 56 | 56 |
Cash flow hedge reserve | (3,640) | (3,119) | (3,640) |
Retained earnings | 210,363 | 195,937 | 206,366 |
| |||
| 207,054 | 193,149 | 203,057 |
Non-current liabilities | |||
Long-term borrowings | 55,000 | 76,000 | 65,000 |
Deferred tax | 7,713 | 8,394 | 8,157 |
62,713 | 84,394 | 73,157 | |
Current liabilities | |||
Bank overdrafts and loans | 11,768 | 13,906 | 8,876 |
Trade and other payables | 920 | 502 | 1,355 |
Current tax payable | 3,525 | 3,718 | 3,813 |
Derivative financial instruments | 3,640 | 3,119 | 3,640 |
| 19,853 | 21,245 | 17,684 |
| |||
Total liabilities | 82,566 | 105,639 | 90,841 |
| |||
Total equity and liabilities | 289,620 | 298,788 | 293,898 |
GROUP CASHFLOW STATEMENT (UNAUDITED)
Half year | Half year | Year | |
ended | ended | ended | |
30.09.2010 | 30.09.2009 | 31.03.2010 | |
£000 | £000 | £000 | |
Cash flows from operating activities | |||
Profit from operations | 13,392 | 14,405 | 32,602 |
Adjustment for: | |||
Depreciation | 75 | 76 | 156 |
(Gain)/Loss on disposal of property, plant and equipment |
(17) |
- |
5 |
(Increase) in fair value of investment properties | - | - | (2,142) |
Cash flow from operations before movement | |||
in working capital | 13,450 | 14,481 | 30,621 |
Decrease in inventories | 3,999 | 5,552 | 11,841 |
(Increase) in receivables | (541) | (221) | (538) |
(Decrease) in payables | (488) | (1,556) | (822) |
Cash generated from operations | 16,420 | 18,256 | 41,102 |
| |||
Interest paid | (1,751) | (1,564) | (3,347) |
Income taxes paid | (3,891) | (2,356) | (6,410) |
Net cash inflow from operating activities |
10,778 |
14,336 |
31,345 |
| |||
Investing activities | |||
Proceeds from disposal of investment properties | 1,100 | 650 | 1,895 |
Proceeds from disposal of property, plant and equipment |
39 |
- |
- |
Purchase of property, plant and equipment | (129) | (7) | (11) |
Capital expenditure on investment properties | (525) | (371) | (434) |
Net cash inflow from investing activities | 485 | 272 | 1,450 |
| |||
Cash flows from financing activities | |||
| |||
Repayment of borrowings | (9,800) | (12,700) | (23,800) |
Equity dividend paid | (4,483) | (4,093) | (6,042) |
Net cash (outflow) from financing activities | (14,283) | (16,793) | (29,842) |
| |||
Net (decrease)/increase in cash and cash equivalents |
(3,020) |
(2,185) |
2,953 |
| |||
Opening cash and cash equivalents | (8,258) | (11,211) | (11,211) |
Closing cash and cash equivalents | (11,278) | (13,396) | (8,258) |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Half year | Half year | Year | |
ended | ended | ended | |
30.09.2010 | 30.09.2009 | 31.03.2010 | |
£000 | £000 | £000 | |
Shareholders' funds as at the beginning of the period |
203,057 |
187,490 |
187,490 |
Profit for the period | 8,480 | 9,257 | 21,635 |
Change in fair value of cash flow hedge | - | 495 | (26) |
Dividends | (4,483) | (4,093) | (6,042) |
Shareholders' funds at the end of the period | 207,054 | 193,149 | 203,057 |
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Half year | Half year | Year | |
ended | ended | ended | |
30.09.2010 | 30.09.2009 | 31.03.2010 | |
£000 | £000 | £000 | |
Profit for the year | 8,480 | 9,257 | 21,635 |
Change in fair value of cash flow hedge | - | 495 | (26) |
Total recognised income | 8,480 | 9,752 | 21,609 |
The total recognised income in the year is attributable to: Equity shareholders of the parent |
8,480 |
9,752 |
21,609 |