NTA.L Regulatory News (NTA)

25 Aug 2005 10:39

Northacre PLC25 August 2005 This announcement replaces the Final results announcement released on RNS number4739Q on Thursday 25 August at 09.10. An amendment has been made to theConsolidated Profit & Loss Account. The turnover including share of associatesand share of turnover of associates have been amended. The full announcementtext appears below. Northacre Plc Results for the year ending 28 February 2005 Northacre today announces its results for the year ended 28 February 2005. •Further planning and construction delays combined with lower market activity have again adversely impacted these results. •Progress of the remaining sales at KINGS Chelsea and The Phillimores continue at a steady pace, albeit at a slower rate than anticipated, thereby delaying receipt of profit entitlement to the financial year to February 2006. •Planning delays at Vicarage Gate House - decision to be determined by a Public Inquiry before end of 2005. •New Mayfair development acquired with planning consent secured. •Implemented measures have generated 52% reduction in Group staff overhead. •New development opportunities under consideration for enhancing fee income and the Group's activities. John Hunter, Chief Executive of Northacre, commented: "Again the Group has suffered the impact of further planning and constructiondelays to its development programme. Although less buoyant market conditionshave resulted in a slower rate of sales activity, we now anticipate the receiptof our profit entitlement on two major schemes shortly. The Group has successfully achieved significant savings in its overhead as wellas reduced levels of debt. With a new development secured in the period andfurther acquisitions in the pipeline, the outlook for the Group is indeed morepromising". Copies of the Annual Report and Accounts will be available at the office ofNorthacre Plc at 48 Old Church Street, London SW3 5BY and are being posted toshareholders. 25th August 2005 Enquiries: Northacre Plc Tel : 020 7349 8000 John Hunter, Chief ExecutiveManish Santilale, Finance Director Chief Executive's Review Overview The Northacre brand continues to be synonymous with the finest quality ofresidential schemes in well-established Central London landmark locations.Northacre's core business is in acquiring opportunities and adding value throughthe development process. To this end, a new consented development project hasbeen acquired in Mayfair. Other similar opportunities are under considerationfor extending the Group's activities for improved fee income and profitgeneration. Financial Results Turnover, including share of associates, for the period was £3,039,401 (2004£4,054,450) with gross profit of £1,445,348 (2004 £2,501,666). Pre-tax loss was£1,182,267 (2004 £2,174,472) before amortisation of goodwill with a basic lossper share of 10.76 pence (2004 15.16 pence) The Board is not declaring adividend payment. Although further planning and construction delays have adversely impacted onthese results, a slowdown in the market conditions has also caused delays inreceipt of the Group's profit entitlement from two major schemes at ThePhillimores and KINGS Chelsea. Operating Subsidiaries It has been a testing period for our operating subsidiaries. However we areconfident that with the new appointments since the year-end and the pipeline ofnew opportunities they will continue to generate a positive contribution to theGroup. OPERATIONAL REVIEW Vicarage Gate House On the grounds of non-determination at Local Authority level it was decided thata Public Inquiry would be the most effective route for determining thisoutstanding planning decision. We anticipate a positive decision will be reachedby the end of 2005. Accordingly the site loan with Deutsche Postbank has beenextended. The Group continues to receive development management fees during thisInquiry process. The Phillimores (Queen Elizabeth College) Although there has been a slowdown in market activity, the progress of sales atThe Phillimores continues at a steady pace with eight apartments remainingunsold. We therefore anticipate receipt of the bulk of our profit share/overageentitlement during the financial year to February 2006. KINGS Chelsea There remains one unsold apartment. Lifestyles Interiors have been appointed tocomplete the dressing of this final show apartment penthouse. We are thereforeconfident our outstanding bonus fees will also be received in the financial yearto February 2006. 44 - 46 Park Street The acquisition of a prime residential scheme in the heart of Mayfair wassecured on 14th February 2005. This Grade II listed building is situatedopposite The Grosvenor House Hotel and now has planning consent for a revisedNorthacre scheme with works already commenced on site. OUTLOOK Although the Group has suffered further losses due to the continued delay of twomajor schemes at KINGS Chelsea and The Phillimores, we are confident theseentitlements will be received in the next financial year. The delay in planningfor Vicarage Gate House has further impacted on our results for the period. Weare confident of a positive outcome at the Public Inquiry, which will enable theGroup to commence the development works within the next year. The acquisition of the Park Street scheme has generated fees for all theoperating subsidiaries, which will further assist the finances of the Group. Inaddition, The Northacre Directors' Pension Fund loan has been further extended. In the light of these circumstances the Board of Directors have implementedsignificant measures to substantially reduce the level of overhead, resulting ina smaller, leaner and more efficient Group. We are confident that together withthe development opportunities available in the market that there is good reasonfor optimism. Consolidated Profit and Loss AccountFor the year ended 28th February 2005 2005 2004 £ £ Turnover including share of associates 3,039,401 4,054,450 Share of turnover of associates (227,641) (219,051) -------- -------- Group Turnover - Continuing Activities 2,811,640 3,835,399 Cost of sales (1,366,292) (1,333,733) -------- -------- Gross Profit 1,445,348 2,501,666 Administrative expenses (3,611,761) (5,282,252)Provision for loss making contract - (350,000)Other operating income 30,927 18,696 -------- -------- Group Operating Loss (2,135,486) (3,111,890) Share of (loss) of associate (12,497) (76,828) -------- -------- Operating Loss including share of associates andjoint ventures (2,147,983) (3,188,718) -------- -------- Loss on Ordinary Activities before Interestand Investment Income (2,147,983) (3,188,718) Income from investments 70,000 80,000Interest receivable 66,828 10,265Interest payable and similar charges (432,320) (337,227) -------- -------- Loss on Ordinary Activities before Taxation (2,443,475) (3,435,680) Taxation - (8,817) -------- -------- Retained Loss for the Year (2,443,475) (3,444,497) ======== ======== Basic loss per ordinary share (10.76)p (15.16)p ======== ======== Fully diluted loss per ordinary share (10.76)p (14.72)p ======== ======== Consolidated Balance Sheet at 28th February 2005 2005 2004 £ £ Fixed AssetsIntangible fixed assets 10,089,668 11,350,876Tangible fixed assets 30,934 2,918,559Investments in joint venture 965,225 870,225Investment in associates 34,494 46,991 -------- -------- 11,120,321 15,186,651Current AssetsWork in progress 182,681 196,939Debtors due within one year 495,141 391,041Cash at bank and in hand 109,758 89,823 -------- -------- 787,580 677,803Creditors: Amounts falling duewithin one year (4,849,297) (6,012,375) -------- -------- Net Current Liabilities (4,061,717) (5,334,572) -------- -------- Total Assets less Current Liabilities 7,058,604 9,852,079 Provision for liabilities and charges - (350,000) -------- -------- Net Assets 7,058,604 9,502,079 ======== ======== Capital and ReservesCalled up share capital - equity interests 567,841 567,841Share premium account 17,449,610 17,449,610Profit and loss account (10,958,847) (8,515,372) -------- -------- Shareholders' Funds 7,058,604 9,502,079 ======== ======== Consolidated Cash Flow StatementFor the year ended 28th February 2005 2005 2004 --- £ £ Net Cash (Outflow) (352,062) (1,656,283)from Operating Activities Returns on Investments and Servicing of FinanceInterest received 66,828 10,265Interest paid (432,320) (331,860)Interest element of finance lease rental paymentsDividend received 70,000 80,000 --------- --------- (295,492) (246,962) TaxationCorporation tax - - Capital Expenditure and Financial InvestmentSale of property 2,849,740 475,000Purchase of other tangible assets (6,516) (43,257)Sale of other tangible assets 250 - --------- --------- Net cash inflow for capital expenditureand financial investment 2,843,474 431,743 Acquisitions and disposalsInvestment in joint venture (95,000) (489,225)Proceeds on disposal of investment in joint venture - 5,020,000 --------- --------- Net cash (outflow)/inflow for acquisitions anddisposals (95,000) 4,530,775 FinancingCapital element of finance lease rental payments (15,805) (3,512)Increase/(decrease) in debt due within one year (1,150,000) --------- --------- Net cash outflow from financing (15,805) (1,153,512) --------- --------- Increase in Cash in the Year 2,085,115 1,905,761 ========= ========= Notes to the Financial StatementsFor the year ended 28th February 2005 1 Principal Accounting PoliciesThe principal accounting policies, which are unchanged from the previous year,are as follows: Accounting basis and standardsThe financial statements have been prepared under the historical costconvention, modified to include the revaluation of freehold property, and inaccordance with applicable accounting standards. The company and group currently meet their day to day working capitalrequirements partly through monies loaned from the Northacre PLC DirectorsRetirement and Death Benefits Scheme and partly from the group's bankers. Thedirectors expect the facilities currently agreed to remain in place for theforseeable future and to be renewed on equally favorable terms in due course. Inparticular, agreement has been reached for one of the loans due to Northacre PLCDirectors Retirement and Death Benefit Scheme of £1m to be extended. The directors have prepared detailed cash flow projections for the period ended31 August 2006 making reasonable assumptions about the levels and timings ofincome and expenditure, and in particular the timing of receipt of certain feesdue from major developments. These projections show that the group can operatewithin the available facilities. On this basis the directors consider itappropriate to prepare the financial statements on a going concern basis. Basis of ConsolidationThe group accounts include the accounts of the company and its subsidiaryundertakings, together with the group's share of the results of joint venturesand associates. DepreciationDepreciation on fixed assets is provided at rates estimated to write off thecost or revalued amounts, less estimated residual value, of each asset over theexpected useful life as follows: Freehold buildings nilFixtures, fittings and office equipment 25% straight lineComputer equipment 331/3% straight lineMotor vehicles 25% straight line It is the group's practice to maintain its freehold buildings in a continualstate of sound repair and to make improvements thereto from time to time. Thedirectors review the valuation of the buildings annually for impairment in itsvalue and as they consider that the residual value at the end of the usefuleconomic life will not be less than its present carrying value, no depreciationis chargeable. Work in ProgressWork in progress is valued at the lower of cost and net realisable value. Costof work in progress includes overheads appropriate to the stage of development.Net realisable value is based upon estimated selling price less further costsexpected to be incurred to completion and disposal. TurnoverTurnover represents amounts invoiced by the group in respect of servicesrendered during the period net of value added tax. Shares in development profitsand bonus fees are recognised when the amounts involved have been finallydetermined. Deferred TaxationIn accordance with FRS19, deferred tax is recognised as a liability or asset iftransactions or events that give the group the obligation to pay more tax infuture or a right to pay less tax in future have occurred by the balance sheetdate. Leased AssetsAssets held under finance leases and hire purchase contracts are capitalised inthe balance sheet and depreciated over their expected useful lives. The interestelement of the rental obligations is charged to the profit and loss account overthe period of the lease on a straight-line basis. Rentals under operating leases are charged to income on a straight-line basisover the lease term.InvestmentsFixed asset investments are stated at cost less amounts written off. GoodwillGoodwill is determined by comparing the amount paid on the acquisition of abusiness and the aggregate fair value of its separable net assets and is writtenoff over its estimated useful life of 10 years. Pension Scheme ArrangementsThe group operates a money purchase scheme on behalf of two of its directors. Italso contributes to certain directors' and employees' personal pension schemes.Pension costs charged represent the amounts payable to the schemes in respect ofthe period. 2 TurnoverThe group's turnover was derived from its principal activities. Sales were madein the following geographical markets: 2005 2004 £ £ United Kingdom 2,811,640 3,835,399 ========= ========= 2005 2004 £ £Principal activities:Profit shares - property development - 350,000Development management 450,600 252,365Interior design 1,898,034 1,877,347Architectural design 463,006 1,355,687 --------- --------- 2,811,640 3,835,399 ========= ========= This information is provided by RNS The company news service from the London Stock Exchange