Smart (J) & Co Regulatory News (SMJ)

3 Apr 2008 16:38

Smart(J.)&Co(Contractors) PLC03 April 2008 J SMART & CO (CONTRACTORS) PLC INTERIM REPORT 6 MONTHS TO 31 JANUARY 2008 J. SMART & CO. (CONTRACTORS) PLCCHAIRMAN'S REVIEWINTERIM REPORTUnaudited Group profits for the six months to 31st January 2008 amounted to£6,566,000 compared with profits of £4,194,000 for the corresponding period lastyear. Turnover increased by 28%. Turnover and own work combined increased by11%.The increase in profits before tax is due to the sale of an undeveloped site inGlasgow. In accordance with our normal practice there has been no revaluation ofour investment properties at the end of the half year. Accordingly the recentfall in property values has had no impact on the half yearly profit figures.There were no private house sales during the half year. We completed the largespeculative industrial unit at Cardonald Business Park and the large pre-letindustrial unit in Helen Street, Glasgow. Helen Street is occupied and Cardonaldis under offer.INTERIM DIVIDENDThe Board announces an interim dividend of 3.00p per share (2007, 3.00p) to bepaid on 9th June 2008 to shareholders on the register at the close of businesson 16th May 2008. After waivers by members holding approximately 51% of theshares the interim dividend will cost the Company £147,000.FUTURE PROSPECTSThe amount of work in hand in contracting is more than at this time last yearand more than at the end of last year. Most of the work has been negotiated.Private House sales including our joint venture development with KeaneDevelopments will be more than last year.Rental income should increase slightly this year although the industrialpre-lets at our Prestonfield Park joint venture with Walker Group will make nocontribution to this year's figures.The mixed commercial and residential development in McDonald Road, Edinburghcontinues but will not be completed this financial year.The recent fall in property values referred to above is due to an increase inyields. It now appears possible that this fall may be ameliorated by increasesin rental and occupation levels, although the likely value of the propertyportfolio at the year end is currently far from clear. The requirement of theInternational Financial Reporting Standards that unrealised gains/losses inrevalued property be included in the Income Statement could have a significantnegative impact on the headline year end profit figure which is not possible toforecast at this stage.Disregarding the impact of revalued property, it is anticipated that subject tounforeseen circumstances, the underlying profit for the year will be not lessthan £8,000,000.3rd April 2008J.M. SMARTChairman CONSOLIDATED INCOME STATEMENT Notes 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000REVENUE 12,316 9,610 19,977Own work capitalised 1,251 2,617 4,579 -------- -------- -------- 13,567 12,227 24,556 Cost of sales (11,625) (9,514) (21,464) -------- -------- --------GROSS PROFIT 1,942 2,713 3,092Other operating income 2,598 2,387 5,024Net operating expenses (2,845) (3,159) (5,033) -------- -------- --------OPERATING PROFIT BEFOREPROFITS ONSALE AND NET REVALUATION GAINS 1,695 1,941 3,083ONINVESTMENT PROPERTIESProfit arising on sale ofinvestment properties 4,155 91 627Net gain on valuation ofinvestment - - 1,944properties ------- -------- --------OPERATING PROFIT 5,850 2,032 5,654Share of profits in Joint 14 1,889 1,800VenturesIncome from investments 30 26 63Profit on sale of investments 9 77 95Finance income 714 286 851Finance costs (51) (116) (319) -------- -------- ---------PROFIT BEFORE TAX 6,566 4,194 8,144Taxation 4 (1,970) (1,258) (1,412) -------- -------- ---------PROFIT ATTRIBUTABLE TO EQUITYSHAREHOLDERS 4,596 2,936 6,732 -------- ======== ========EARNINGS PER SHARE - BASIC ANDDILUTED 6 45.59p 29.12p 66.77p ======== ======== ======== CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE Notes 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000Actuarial gain recognised ondefined benefit pension scheme - - 2,755Deferred taxation on actuarial - - (826)gain ------- ------- -------NET SURPLUS RECOGNISEDDIRECTLY IN - - 1,929EQUITY ------- ------- -------Profit for the period 4,596 2,936 6,732 ------- ------- -------TOTAL RECOGNISED INCOME ANDEXPENSE 4,596 2,936 8,661FOR THE PERIOD ------- ------- -------ATTRIBUTABLE TO EQUITY 4,596 2,936 8,661SHAREHOLDERS ======= ======= ======= CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY Notes 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000TOTAL RECOGNISED INCOME ANDEXPENSE 4,596 2,936 8,661FOR THE PERIODFair value adjustment net of (182) 49 24taxDividends 5 (500) (483) (630) ------- ------- ------- 3,914 2,502 8,055Opening shareholders' funds 92,135 84,080 84,080 ------- ------- -------Closing shareholders' funds 96,049 86,582 92,135 ======= ======= ======= CONSOLIDATED BALANCE SHEET Notes 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000NON-CURRENT ASSETSProperty, plant and equipment 1,493 5,099 2,537Investment properties 72,649 75,601 72,545Investments in Joint Ventures 2,040 6,394 1,996Financial assets 1,728 1,686 1,695Trade and other receivables 2,176 2,796 2,176Deferred tax assets 1,561 2,531 1,641 ------- ------- ------- 81,647 94,107 82,590 ------- ------- -------CURRENT ASSETS Inventories 8,970 3,615 7,635Trade and other receivables 3,721 2,975 3,700Cash and bank 22,793 8,449 16,468 ------- ------- ------- 35,484 15,039 27,803 ------- ------- -------TOTAL ASSETS 117,131 109,146 110,393 ======= ======= =======NON-CURRENT LIABILITIES Retirement benefit obligations 5,280 8,201 5,280Deferred tax liabilities 7,706 9,754 7,843 ------- ------- ------- 12,986 17,955 13,123 ------- ------- -------CURRENT LIABILITIES Trade and other payables 6,164 3,351 4,265Current tax liabilities 1,932 1,258 870 ------- ------- ------- 8,096 4,609 5,135 ------- ------- -------TOTAL LIABILITIES 21,082 22,564 18,258 ------- ======= =======NET ASSETS 96,049 86,582 92,135 ======= ======= =======EQUITY Called up share capital 1,008 1,008 1,008Fair value reserve 190 542 372Retained earnings 94,851 85,032 90,755 ------- ------- -------TOTAL EQUITY 96,049 86,582 92,135 ======= ======= ======= CONSOLIDATED CASH FLOW STATEMENT Notes 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000Cash flows from operatingactivities 7 2,459 594 (1,546)Tax paid on profits (908) (1,346) (2,346) ------- --------- ---------NET CASH FLOW FROM OPERATINGACTIVITIES 1,551 (752) (3,892) ------- ------- ---------CASH FLOWS FROM INVESTINGACTIVITIESPurchase of property, plantand (155) (189) (465)equipmentPurchase of investment (34) (29) (5)propertiesSale of property, plant andequipment 9 21 79Sale of investment properties 6,335 2,020 12,046Expenditure on own work (1,251) (2,617) (4,579)capitalisedPurchase of investments (325) (210) (282)Proceeds of sale of 60 168 205investmentsInterest received 635 269 740Interest paid - - -Dividend received from JointVenture - - 3,000 ------- ------- -------NET CASH FROM INVESTING 5,274 (567) 10,739ACTIVITIES ------- ------- -------CASH FLOWS FROM FINANCINGACTIVITIES Dividends paid (500) (483) (630) ------- ------- -------NET CASH USED IN FINANCINGACTIVITIES (500) (483) (630) ------- ------- -------INCREASE/(DECREASE) IN CASH,CASH 6,325 (1,802) 6,217EQUIVALENTS AND BANK ------- ------- -------CASH, CASH EQUIVALENTS ANDBANK AT 16,468 10,251 10,251BEGINNING OF PERIOD ------- ------- -------CASH, CASH EQUIVALENTS ANDBANK AT 22,793 8,449 16,468END OF PERIOD ======= ======= ======= NOTES TO INTERIM FINANCIAL STATEMENTS 1. BASIS OF PREPARATION These interim financial statements do not constitute statutory accounts asdefined in Section 240 of the Companies Act 1985. The statutory financial statements for the year to 31st July 2007 have beenfiled with the Registrar of Companies and a copy may be obtained from CompaniesHouse. These have been audited and contain an unqualified audit opinion and donot contain a statement under Sections 237(2) or (3) of the Companies Act 1985. 2. ACCOUNTING POLICIES The interim financial statements have been prepared under the historical costconvention. The accounting policies adopted are consistent with those followed in thepreparation of the group's annual financial statements for the year ended 31stJuly 2007, with the exception of the following policies regarding the accountingfor pension scheme deficits and investment properties revaluations. For the interim accounts the assets and liabilities of the pension scheme areestimated to be unchanged from the values included at the previous year end. In accordance with long standing practice, the group's investment properties arerevalued annually on 31st July each year. No revaluation adjustment is made inthe interim financial statements. 3. SEGMENTAL INFORMATION The group's primary basis of segmentation is by activities, all constructionwork relates to activities in Scotland. Inter Total Segment External Profit attributable to Revenue Revenue Revenue equity shareholders £000 £000 £000 £000 £000 £00031st JANUARY2008 (Unaudited)Construction 13,567 (1,251) 12,316 77 - -activitiesInvestment 2,598 - 2,598 5,773 - -activitiesJoint Ventures - - - 14 - - ------ ------ ------ ------ ------ ------ 16,165 (1,251) 14,914 5,864 - - ------ ------ ------ ------ ------ ------31st JANUARY2007 (Unaudited)Construction 12,227 (2,617) 9,610 - 914 -activitiesInvestment 2,387 - 2,387 - 1,118 -activitiesJoint Ventures - - - - 1,889 - ------ ------ ------ ------ ------ ------ 14,614 (2,617) 11,997 - 3,921 - ------ ------- ------ ------ ------ ------31st JULY 2007(Audited) Construction 24,556 (4,579) 19,977 - - 823activitiesInvestment 5,024 - 5,024 - - 4,831activitiesJoint Ventures - - - - - 1,800 ------ ------ ------ ------ ------ ------ 29,580 (4,579) 25,001 - - 7,454 ------ ------- ------ ------ ------ ------RESULT 5,864 3,921 7,454 Finance andinvestment 753 389 1,009income Finance andinvestment (51) (116) (319)costs ------ ------ ------PROFIT ONORDINARY 6,566 4,194 8,144ACTIVITIES BEFORE TAX Tax on profit onordinary (1,970) (1,258) (1,412)activities ------ ------ ------PROFITATTRIBUTABLE TO 4,596 2,936 6,732EQUITY ====== ====== ======SHAREHOLDERS 4. TAXATION The tax charge for the 6 months to 31st January 2008 is based on the corporationtax rate at 30% (2007, 30%). 5. DIVIDENDS 6 Months 6 Months Year Ended Ended Ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000ORDINARY DIVIDENDS2007 Final dividend declared of10.15p per share 500 - -2007 Interim dividend declared of3.00p per share - - 1472006 Final dividend of 9.80p per - 483 483share ----- ----- ----- 500 483 630 ===== ===== ===== Certain shareholders holding approximately 51% of the shares have waived theirrights to the interim and final dividends paid for the years to 31st July 2006and 31st July 2007. The interim dividend of 3.00p per share for the year to 31st July 2008 will bepaid on 9th June 2008 to shareholders on the register at 16th May 2008. Afterwaivers by members holding approximately 51% of the shares the interim dividendwill cost the company £147,000. 6. EARNINGS PER SHARE Profit attributable Basic to equity earnings shareholders per share £0006 months to 31st January 2008 4,596 45.59p ====== ======6 months to 31st January 2007 2,936 29.12p ====== ======Year to 31st July 2007 6,732 66.77p ====== ====== Basic earnings per share are calculated by dividing the profit attributable toequity shareholders by 10,082,000 shares, the number of ordinary shares in issueduring the period. There is no difference between basic and diluted earnings per share. 7. RECONCILIATION OF OPERATING PROFIT TO CASH FLOWS FROM OPERATING ACTIVITIES 6 Months 6 Months Year ended ended ended 31.1.08 31.1.07 31.7.07 (Unaudited) (Unaudited) (Audited) £000 £000 £000 Profit before tax 6,566 4,194 8,144Share of profits from Joint Ventures (14) (1,889) (1,800)Depreciation 192 204 483Unrealised revaluation gains oninvestment properties - - (1,944)Gain on sale of property, plant andequipment - (17) (68)Gain on sale of investment properties (4,155) (91) (627)Gain on sale of investments (9) (77) (95)Change in retirement benefits - - (166)Interest received (634) (269) (740)Interest received by Joint Ventures (80) (17) (111)Interest paid - - -Interest paid by Joint Ventures 51 115 150Change in inventories (1,335) (1,309) (5,330)Change in receivables - current (22) (270) (376)Change in receivables - non current - - -Change in payables 1,899 20 934 ------- ------- -------NET CASH GENERATED FROM OPERATIONS 2,459 594 (1,546) ======= ======= ======= This information is provided by RNS The company news service from the London Stock Exchange