30 Jun 2009 15:39
30 June 2009
SAFELAND PLC
Preliminary results for the year ended 31 march 2009
Chairman's Statement
Market conditions throughout the year have remained difficult and property prices have continued to fall. The Board has looked at the value of the portfolio as at the year end with the assistance of external valuers and has made the decision to write down the Group's trading properties by £4,648,000 (2008:£1,463,000).
This has obviously impacted on the results for the year ended March 31 2009 such that the Group has made a loss before tax of £8,339,000 (2008: £977,000 loss). The resultant loss per share is 51.33p (2008: 3.92p loss per share). Revenue for the year was £15,115,000 compared to £23,567,000 in the prior year. Gearing at the year end was 154% (2008: 110%). Net assets per share at the year end were 63p (2008: 114p).
The Board has also decided to write down the value of the investment in the Managed Workspace Fund by a further £400,000 in addition to the £500,000 that was written off at the time of the Group's unaudited interim results to September 30 2008. The carrying value of this original investment is now £100,000. Notwithstanding this, the Board continues to believe that the value of the underlying properties in this fund will recover over the forthcoming years. Furthermore, it has taken the opportunity since the year end to increase Safeland's stake in the fund to just under 40% by purchasing 50% of the units owned by the largest investor, Babcock & Brown. The other 50% has been purchased by Electra who were also existing investors in the Fund.
This entire year has been one of continued consolidation due to the extremely difficult and unprecedented market conditions. Whilst there is no significant improvement on the horizon, there has been an increase in activity since the year end.
With the continued support of the banks and our professional team, we consider that Safeland is well positioned to take full advantage of any improvement in market conditions as and when they may occur, whilst also assessing opportunities in other areas that have the potential to improve the Company. I therefore, remain optimistic for the long term future.
CONSOLIDATED INCOME STATEMENT
Year ended 31 March 2009
|
| Note |
| 2009 £'000 | 2008 £'000 |
|
|
|
| Unaudited | Audited |
|
|
|
|
|
|
| Revenue | 2 |
| 15,115 | 23,567 |
|
|
|
| ||
| Cost of sales (including amounts written off inventories of £4,648,000 (2008: £1,463,000)) |
|
| (18,472) | (19,339) |
| Gross (loss) / profit |
|
| (3,357) | 4,228 |
|
|
|
| ||
| Sales and distribution costs |
|
| (464) | (573) |
|
|
|
| ||
| Administrative expenses |
|
| (4,114) | (4,022) |
|
|
|
| ||
| Other operating income |
|
| 758 | 855 |
| Loss on disposal of property, plant and equipment | (14) | (4) | ||
|
|
|
| ||
| Gains on revaluation of investment properties |
|
| 1,295 | 287 |
| (Loss) / profit on disposal of investment properties |
|
| (290) | 105 |
| Operating (loss) / profit |
|
| (6,186) | 876 |
|
|
|
| ||
| Share of results of associates - post tax |
|
| - | - |
| Impairment of available-for-sale investments | (900) | - | ||
| Impairment of interests in associates | - | (10) | ||
| (Loss) / profit before interest |
|
| (7,086) | 866 |
|
|
|
| ||
| Finance income |
|
| 84 | 81 |
| Finance costs |
|
| (1,337) | (1,924) |
| Loss before tax | 2 |
| (8,339) | (977) |
|
|
|
| ||
| Tax |
|
| (312) | 267 |
| Loss for the financial year from continuing operations |
|
| (8,651) | (710) |
| Loss for the period from discontinued operations | 3 | - | (83) | |
| Loss for the financial year | (8,651) | (793) |
CONSOLIDATED INCOME STATEMENT
Year ended 31 March 2009
| 2009 | 2008 | |||
| Unaudited | Audited | |||
| Loss per share | ||||
| Continuing operations | ||||
| Basic loss per share | 4 |
| (51.33)p | (3.92)p |
| Diluted loss per share | (51.33)p | (3.92)p | ||
| Continuing and discontinued operations | ||||
| Basic loss per share | (51.33)p | (4.38)p | ||
| Diluted loss per share | (51.33)p | (4.38)p | ||
CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
Year ended 31 March 2009
|
| Note | 2009 £'000 | 2008 £'000 | |||
|
|
|
| Unaudited | Audited | ||
|
|
|
|
|
| ||
| Fair value losses on available-for-sale investments |
|
| (16) | (102) | ||
|
|
|
| ||||
| Exchange differences on translation of foreign operations |
|
| - | (38) | ||
|
|
|
| ||||
| Tax on items taken directly to equity |
|
| 6 | 30 | ||
| Transfer foreign currency translation reserve to income statement | - | 45 | ||||
| Net loss recognised directly in equity | (10) | (65) | ||||
| Loss for the year |
| (8,651) | (793) | |||
| Total recognised income and expense for the year attributable to equity shareholders |
| 7 | (8,661) | (858) | ||
CONSOLIDATED BALANCE SHEET
31 March 2009
|
|
| Note | 2009 £'000 |
| 2008 £'000 |
|
|
|
| Unaudited |
| Audited |
| Non-current assets |
|
|
|
|
|
| Property, plant and equipment |
|
| 2,052 |
| 2,177 |
| Investment properties |
|
| 3,046 |
| 2,054 |
| Interests in associates | - | - | |||
| Available-for-sale investments |
|
| 273 |
| 1,089 |
| Deferred tax assets |
|
| - |
| 104 |
|
|
|
|
| ||
| Total non-current assets |
|
| 5,371 |
| 5,424 |
|
|
|
|
| ||
| Current assets |
|
|
| ||
| Trading properties |
|
| 22,272 |
| 33,390 |
| Trade and other receivables |
|
| 427 |
| 2,657 |
| Current tax receivable | - | 283 | |||
| Cash and cash equivalents |
| 6 | 1,811 |
| 813 |
|
|
|
|
| ||
| Total current assets |
|
| 24,510 |
| 37,143 |
|
|
|
|
| ||
| Total assets |
| 2 | 29,881 |
| 42,567 |
|
|
|
|
| ||
| Current liabilities |
|
|
| ||
| Bank loans and overdrafts |
|
| 18,179 |
| 19,679 |
| Trade and other payables |
|
| 572 |
| 1,255 |
| Current tax liabilities |
|
| 15 |
| - |
|
|
|
|
| ||
| Total current liabilities |
|
| 18,776 |
| 20,934 |
|
|
|
|
| ||
| Non-current liabilities |
|
|
| ||
| Bank loans |
|
| - |
| 2,301 |
| Deferred tax liabilities |
|
| 466 |
| 146 |
|
|
|
|
| ||
| Total non-current liabilities |
|
| 466 |
| 2,447 |
|
|
|
|
| ||
| Total liabilities |
| 2 | 19,232 |
| 23,381 |
|
|
|
|
| ||
| Net assets |
|
| 10,649 |
| 19,186 |
|
|
|
|
| ||
| Equity |
|
|
| ||
| Share capital |
|
| 843 |
| 843 |
| Share premium account |
|
| 5,351 |
| 5,351 |
| Capital redemption reserve |
|
| 847 |
| 847 |
| Share based payment reserve | 210 | 86 | |||
| Investment revaluation reserve | 3 | 13 | |||
| Retained earnings |
|
| 3,395 |
| 12,046 |
|
|
|
|
| ||
| Total equity |
| 7 | 10,649 |
| 19,186 |
|
|
|
|
|
|
|
CONSOLIDATED CASH FLOW STATEMENT
Year Ended 31 March 2009
|
|
|
| Note | 2009 £'000 | 2008 £'000 | ||||
|
|
|
|
| Unaudited | Audited | ||||
|
|
|
| |||||||
| Operating activities | |||||||||
| Net cash inflow from operations |
|
| 5 | 5,798 | 6,724 | ||||
| Interest paid |
|
| (1,337) | (1,924) | |||||
| Tax received / (paid) | 416 | (542) | |||||||
| Net cash inflow from operating activities | 4,877 | 4,258 | |||||||
| Investing activities |
|
|
| ||||||
| Interest received |
|
|
| 68 | 81 | ||||
| Dividends received | 16 | - | |||||||
| Purchase of investment properties |
|
|
| (511) | (761) | ||||
| Purchase of property, plant and equipment |
|
|
| (139) | (482) | ||||
| Purchase of available-for-sale investments |
|
|
| (100) | - | ||||
| Proceeds from sale of property, plant and equipment |
|
|
| 64 | 278 | ||||
| Proceeds from sale of investment properties |
|
|
| 524 | 967 | ||||
| Cash outflows in respect of subsidiary in voluntary liquidation | - | (358) | |||||||
|
|
|
| |||||||
| Net cash outflow from investing activities |
|
|
| (78) | (275) | ||||
|
|
|
| |||||||
| Financing activities |
|
|
| ||||||
| New loans |
|
|
| 9,439 | 19,140 | ||||
| Loan repayments |
|
|
| (12,464) | (23,330) | ||||
| Purchase of own shares | - | (1,160) | |||||||
|
|
|
| |||||||
| Net cash outflow from financing activities |
|
|
| (3,025) | (5,350) | ||||
|
|
|
|
| ||||||
| Net increase / (decrease) in cash and cash equivalents in the year |
|
|
| 1,774 | (1,367) | ||||
| Cash and cash equivalents at beginning of year |
|
|
| (18) | 1,349 | ||||
|
|
|
| |||||||
| Cash and cash equivalents at end of year |
|
| 6 | 1,756 | (18) | ||||
NOTES TO THE PRELIMINARY ANNOUNCEMENT
Year ended 31 March 2009
1. BASIS OF PREPARATION
The financial information set out in the announcement does not constitute the group's statutory financial statements within the meaning of section 240 of the Companies Act 1985, for the years ended 31 March 2009 or 2008. The statutory financial statements for the year ended 31 March 2009 will be finalised and signed on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the company's Annual General Meeting.
The financial information for the year ended 31 March 2008 is derived from the statutory accounts for that year. The auditor reported on those statutory accounts which have been delivered to the Registrar of Companies. The audit report was unqualified and did not contain a statement under s237(2) or (3) of the Companies Act 1985.
This announcement is prepared applying International Financial Reporting Standards as adopted by the European Union and using accounting policies that are consistent with those as stated in the previous year's financial statements.
This preliminary announcement was approved by the Board of directors on 29 June 2009.
Copies of this announcement are available from the company's registered office at 94-96 Great North Road, London, N2 0NL and on its website, www.safeland.co.uk. The Annual Report and Accounts will be sent to shareholders shortly.
2. BUSINESS AND GEOGRAPHICAL SEGMENTS
Business segments
For management purposes, the group was organised into three operating divisions as detailed below:
property trading, property refurbishment and property investment
property fund management; and
self storage
These divisions are the basis on which the group reports its primary segmental information.
The group's self storage subsidiary was placed into voluntary liquidation on 1 October 2007 and this segment has been disclosed as a discontinued operation in the comparative numbers.
Geographical segments
The group's operations are wholly based in the United Kingdom except the self-storage operation which operated in Italy and was placed into voluntary liquidation on 1 October 2007.
No additional segmental disclosure is provided in respect of geographical segments as they are identical to the business segments detailed above.
| Year ended 31 March 2009 | Property trading, refurbishment and investment | Fund management | Total |
| £'000 | £'000 | £'000 | |
| Revenue | 14,705 | 410 | 15,115 |
| Segment result | (5,594) | (592) | (6,186) |
| Impairment of available-for-sale investments | (900) | ||
| Finance income | 84 | ||
| Finance costs | (1,337) | ||
| Loss before tax | (8,339) | ||
| Tax | (312) | ||
| Loss for the financial year | (8,651) | ||
| Other information | |||
| Capital expenditure | 139 | - | 139 |
| Depreciation | 156 | 31 | 187 |
| Share based payment | - | 124 | 124 |
| Balance sheet | |||
| Segment assets | 29,400 | 208 | 29,608 |
| Available-for-sale investments | 273 | ||
| Total assets | 29,881 | ||
| Segment liabilities | 547 | 25 | 572 |
| Borrowings | 18,179 | ||
| Deferred tax liabilities | 466 | ||
| Current tax liabilities | 15 | ||
| Total liabilities | 19,232 | ||
| Year ended 31 March 2008 | Property trading, refurbishment and investment | Self storage | Fund management | Discontinued operations | Total |
| | £’000 | £’000 | £’000 | £’000 | £’000 |
| | | | | | |
| Revenue | 23,136 | 225 | 431 | (225) | 23,567 |
| | | | | | |
| Segment result | 1,353 | (52) | (477) | 52 | 876 |
| | | | | | |
| Impairment of interests in associates | | | | (10) | |
| Finance income | | | | | 81 |
| Finance costs | | | | | (1,924) |
| Loss before tax | | | | | (977) |
| Tax | | | | | 267 |
| Loss for the year from discontinued operations | | | | (83) | |
| Loss for the financial year | | | | | (793) |
| | | | | | |
| | | | | | |
| Other information | | | | | |
| Capital expenditure | 1,208 | 12 | 23 | | 1,243 |
| Depreciation | 164 | - | 28 | | 192 |
| Share based payment | - | - | 86 | | 86 |
| | | | | | |
| Balance sheet | | | | | |
| Segment assets | 38,044 | 1,593 | 1,454 | | 41,091 |
| Available-for-sale investments | | | | | 1,089 |
| Deferred tax asset | | | | | 104 |
| Current tax recoverable | | | | | 283 |
| Total assets | | | | | 42,567 |
| | | | | | |
| Segment liabilities | 1,095 | - | 160 | | 1,255 |
| Borrowings | | | | | 21,980 |
| Deferred tax liabilities | | | | | 146 |
| Total liabilities | | | | | 23,381 |
| | | | | | |
3. DISCONTINUED OPERATIONS
On 1 October 2007, the Group's subsidiary, Espazio SRL was placed into voluntary liquidation and hence all assets and liabilities were deemed to be disposed of on this date. This subsidiary carried out the Group's self storage business. The results of the discontinued operations which have been included within the consolidated income statement, were as follows:
| 2009 £'000 | 2008 £'000 | |||
| Unaudited | Audited | |||
| Revenue | - | 225 | ||
| Expenses | - | (277) | ||
| Finance costs (net) | - | (28) | ||
| Loss before tax | - | (80) | ||
| Foreign currency translation reserve | - | (45) | ||
| Profit on disposal of discontinued operations | - | 42 | ||
| Loss attributable to discontinued operations | - | (83) |
| Basic loss per share | (0.46)p |
| Diluted loss per share | (0.46)p |
4. LOSS PER SHARE
The calculation of the basic and diluted loss per share is based on the following data:
| 2009 £'000 | 2008 £'000 | ||
| Unaudited | Audited | ||
| Loss for the year from continuing operations | (8,651) | (710) | |
| Loss for the year from discontinued operations | - | (83) | |
| Loss for the year attributable to equity holders of the company | (8,651) | (793) | |
| 2009 '000 | 2008 '000 | ||
| Unaudited | Audited | ||
| Weighted average number of ordinary shares for the purposes of basic loss per share | 16,851 | 18,122 | |
| Effect of dilutive potential ordinary shares | - | - | |
| Weighted average number of ordinary shares for the purposes of diluted loss per share | 16,851 | 18,122 |
There is no dilutive effect of potential ordinary shares in 2009 or 2008 as in both instances there is a loss for the year.
5. NOTES TO THE CASH FLOW STATEMENT
| 2009 £'000 | 2008 £'000 | ||
| Unaudited | Audited | ||
| Loss before tax from continuing operations | (8,339) | (977) | |
| Loss before tax from discontinued operations | - | (83) | |
| Adjustments for: | |||
| Depreciation of property, plant and equipment | 187 | 192 | |
| Loss on sale of property, plant and equipment | 14 | 4 | |
| Loss / (profit) on sale of investment properties | 290 | (105) | |
| Gains on revaluation of investment properties | (1,295) | (287) | |
| Impairment of available-for-sale investments | 900 | - | |
| Impairment of interests in associates | - | 10 | |
| Share based payment charge | 124 | 86 | |
| Finance costs (net) | 1,252 | 1,871 | |
| Changes in working capital: | |||
| Decrease in trading properties | 11,118 | 5,363 | |
| Decrease in trade and other receivables | 2,230 | 1,136 | |
| Decrease in trade and other payables | (683) | (486) | |
| Net cash inflow from operations | 5,798 | 6,724 |
6. CASH AND CASH EQUIVALENTS
| 2009 £'000 | 2008 £'000 | |
| Unaudited | Audited | |
|
|
| |
| Cash and cash equivalents per balance sheet | 1,811 | 813 |
| Bank overdrafts | (55) | (831) |
| Cash and cash equivalents per cash flow statement | 1,756 | (18) |
7. STATEMENT OF CHANGES IN EQUITY
| 2009 £'000 | 2008 £'000 | ||
| Unaudited | Audited | ||
| 1 April 2008 | 19,186 | 21,118 | |
| Total recognised income and expense for the year | (8,661) | (858) | |
| Purchase of own shares | - | (1,160) | |
| Share based payment charge | 124 | 86 | |
| 31 March 2009 | 10,649 | 19,186 |