Wynnstay Props. Regulatory News (WSP)

22 Nov 2006 09:43

Wynnstay Properties PLC22 November 2006 Wynnstay Properties PLC ("Wynnstay" or "the Company") Interim Results for the six months ended 29th September 2006 Chairman's Statement I am pleased to report increased profits and earnings per share, despite lowerproperty income, compared with the interim results last year. Although we donot carry out a revaluation at the interim stage, net asset value per sharereflects the property valuation conducted in March 2006 and is thussubstantially above the figure at this time last year. The results may be summarised as follows:- 2006 2005 • Profit on Ordinary Activities before taxation: + 8.8% £283,000 £260,000• Earnings per share: + 8.6% 6.3p 5.8p• Interim dividend per share: + 6.5% 2.45p 2.3p• Net asset value per share: + 14.6% 432p 377p As anticipated, property income was lower in the first half, mainly as aconsequence of the Epsom property remaining vacant following the lease expiry inSeptember 2005. However, this was partially offset by a full contribution fromthe letting of the vacant unit at Basingstoke and the letting of three recentlyrefurbished industrial units at St. Neots as well as from satisfactory rentreview settlements achieved elsewhere in the portfolio. You will recall that we made an application for planning consent in relation tothe Epsom property, involving the construction of an additional fifth floor andthe conversion of the four upper floors for residential use, to comprise 15apartments, with commercial use retained on the ground floor only. ThoseShareholders who were able to attend the Annual General Meeting in July wereable to see our plans for the property, which generated a considerable degree ofinterest. I am pleased to report that permission for the scheme was grantedearly in September. The Board reviewed the strategy and options for thisproperty at its meeting shortly thereafter. We concluded that it would be in the best interests of Shareholders, havingregard to the continuing strength of the residential market and the considerableinterest expressed by a number of specialist developers for this type ofproject, for the property to be sold with the benefit of the planning permissionwe had obtained. Contracts were exchanged on 21st November 2006 for the sale ofthis property for a cash consideration of £2,000,000. After taking account ofthe settlement negotiated with the previous tenant and the design, planning andselling costs involved, this disposal is expected to result in a net surplusover book value of approximately £948,000, on which no tax liability shouldarise. This surplus equates to 30 pence per share, which will be reflected inthe Company's financial statements for the year ending 25th March 2007. Thisvery profitable transaction was achieved as a result of the Company procuring askilfully and sensitively designed scheme for the conversion of the property tosatisfy stringent planning requirements, coupled with a professionally executedmarketing campaign. During the first half, we examined numerous potential investment opportunitiesand engaged in some detailed discussions with vendors, but no acquisitions tookplace during the period. It remains difficult to acquire attractive investmentproperties which provide opportunities for medium to long-term growth at priceswhich can be justified. The intense competition in the market has driven pricesup to levels we consider will prove difficult to sustain. However, as I havesaid before, this has the benefit that the value of your Company's properties atthe present time is being strongly sustained by these conditions which, shouldthey continue throughout the second half, are likely to have a positive impacton the year end property revaluation. In the meantime, and especially with thecombination of low gearing, the unutilised element of our borrowing facilitiesand the funds which will be generated from the disposal of the Epsom property,the Company remains in a strong position to make significant investments as andwhen opportunities arise or market conditions change. Prospects for the full year appear satisfactory. Although property income islikely to be somewhat lower than last year, we expect this to be countered bylower overhead and interest costs. Profits will also be enhanced by thedisposal of the Epsom property. In the light of these results, the Directors have decided to declare an interimdividend of 2.45p per share, representing an increase of 6.5% over last year.This will be paid on 14th December 2006 to those Shareholders on the register on1st December 2006. Whilst we will, of course, decide on the appropriate amountto recommend as a final dividend having regard to the results for the full year,the Board is hopeful that this will reflect a similar percentage increase. The financial statements included in this report have been prepared inaccordance with accounting standard FRS 21 which requires that dividendsdeclared after the balance sheet date are not recognised as a liability. Thismeans they include the final dividend for the last financial year paid in August2006, but not the interim dividend payable in December 2006. Further, they donot reflect the release of deferred tax provisions no longer required, amountingto £159,000, which will be reflected in the accounts for the full year. I am extremely sorry to report that our Finance Director, Peter Kirkland, hasdecided to retire at the age of 60. Peter has steered Wynnstay skilfullythrough a period of great change over the last 12 years. We are indebted to himfor his commitment and loyalty and we will miss his breadth of experience andwise counsel. I will include a fuller tribute to him in my annual statement.We are in the course of recruiting his successor and an announcement will bemade in due course. A record number of Shareholders were able to attend the Annual General Meetingin July. The meeting provides a valuable opportunity for the Directors to talkwith Shareholders both formally and informally and to gauge interest in theCompany and its future. It also provides an occasion at which Shareholders candiscuss the Company's progress with each other. Our Annual General Meeting nextyear will again be held at the Royal Automobile Club, 89 Pall Mall, London SW1on Thursday 26th July 2007 and I hope that we will once again have an excellentattendance. Philip G.H. Collins Chairman 22nd November 2006 Unaudited Consolidated Profit & Loss AccountSix Months ended 29th September 2006 Six Months ended Year ended 29th September 25th March 2006 2005 2006 (Unaudited) (Audited) £'000 £'000 £'000 TurnoverGross Rental Income 770 812 1,560Fees and Commissions 8 8 17 -------------- -------------- -------------- 778 820 1,577 Property Outgoings (30) (24) (62) -------------- -------------- -------------- 748 796 1,515 Administration and Other Costs (278) (341) (589) -------------- -------------- -------------- Operating Profit 470 455 926 Finance Costs (Net) (187) (195) (373) -------------- -------------- -------------- Profit on Ordinary Activitiesbefore Taxation 283 260 553 Taxation (85) (78) (168) -------------- -------------- -------------- Profit on Ordinary Activitiesafter Taxation 198 182 385 Dividends paid (see note 3) (189) (180) (253) -------------- -------------- -------------- Profit Retained 9 2 132 -------------- -------------- -------------- Basic Earnings per share (see note 1) 6.3p 5.8p 12.2p Unaudited Consolidated Balance Sheetat 29th September 2006 29th September 2006 29th September 2005 25th March (Unaudited) (Unaudited) 2006 (Audited) £'000 £'000 £'000 Fixed AssetsTangible Assets 20,360 18,750 20,357Investments 1 1 1 -------------------- -------------------- -------------------- 20,361 18,751 20,358Current AssetsDebtors 98 85 35Cash at Bank and in Hand 180 369 316 -------------------- -------------------- -------------------- 278 454 351Creditors: Amounts falling due Within one year (679) (799) (758) -------------------- -------------------- --------------------Net Current Liabilities (401) (345) (407) -------------------- -------------------- --------------------Total Assets Less Current Liabilities 19,960 18,406 19,951Creditors: Amounts falling due after more thanone year (6,000) (6,200) (6,000) -------------------- -------------------- -------------------- 13,960 12,206 13,951 Provision for Liabilities and Charges (314) (304) (314) -------------------- -------------------- --------------------Net Assets 13,646 11,902 13,637 -------------------- -------------------- -------------------- Capital and ReservesShare Capital 789 789 789Capital Redemption Reserve 205 205 205Share Premium Account 1,135 1,135 1,135Capital Reserve 151 151 151Revaluation Reserve 6,277 4,672 6,277Distributable Reserves 5,089 4,950 5,080 -------------------- -------------------- --------------------Equity Shareholders' Funds 13,646 11,902 13,637 -------------------- -------------------- -------------------- Unaudited Consolidated Cash Flow Statement Six Months ended 29th September 2006 Six Months ended Year ended 29th September 25th March 2006 2005 2006 (Unaudited) £'000 £'000 £'000 Cash Flow from Operating Activities (Note A) 398 521 1,004 --------------- --------------- ---------------Returns on Investment and Servicing of FinanceInterest Received 4 6 10Interest Paid (258) (195) (388) --------------- --------------- --------------- Net Cash (Outflow) from Returns onInvestment and Servicing of Finance (254) (189) (378) --------------- --------------- --------------- Taxation Paid (86) (55) (127) --------------- --------------- --------------- Capital Expenditure and Financial InvestmentPurchase of Tangible Fixed Assets (5) (1) (3)Disposal of Tangible Fixed Assets - 1 1 --------------- --------------- ---------------Net Cash (Outflow) from Investing Activities (5) - (2) --------------- --------------- --------------- Equity Dividends Paid (189) (180) (253) --------------- --------------- --------------- Net Cash (Outflow)/Inflow before Financing (136) 97 244 FinancingRepayment of Bank Loan - - (200) --------------- --------------- ---------------(Decrease)/Increase in Cash in the Period (136) 97 44 --------------- --------------- --------------- Reconciliation of Net Cash Flow to Movement in Net Debt(Decrease)/Increase in Cash in the Period (136) 97 44Cash Inflow from Debt Financing - - 200 --------------- --------------- --------------- Movement in Net Debt in the Period (136) 97 244 Net Debt at 25th March 2006 (5,684) (5,928) (5,928) --------------- --------------- --------------- Net Debt at 29th September 2006 (Note B) (5,820) (5,831) (5,684) --------------- --------------- --------------- Notes To Cash Flow Statement A. Reconciliation of Operating Profit to Net Cash Inflow from OperatingActivities Six Months ended Year ended 29th September 25th March 2006 2005 2006 £'000 £'000 £'000Operating Profit 470 455 926Depreciation and Amortisation 2 1 2(Increase)/Decrease in Debtors (63) (1) 49(Decrease)/Increase in Creditors (11) 66 27 -------------- -------------- --------------Net Cash Inflow from Operating Activities 398 521 1,004 -------------- -------------- -------------- B. Analysis of Net Debt 29th September 2006 Cash Movement 25th March 2006 £'000 £'000 £'000 Cash at Bank and in Hand 180 (136) 316Debt due after more than one year (6,000) - (6,000) --------------- --------------- ---------------Net Debt (5,820) (136) (5,684) --------------- --------------- --------------- Notes 1. Basic earnings per share have been calculated on profits after taxationattributable to Ordinary Shareholders of £198,000 (2005: £182,000) and on3,155,267 ordinary shares, being the weighted average number in issue duringboth periods. 2. The figures in these statements do not constitute statutory accounts;those for the year ended 25th March 2006 are extracted from the Group Accountswhich have been filed with the Registrar of Companies and which received anunqualified report from the Auditors and did not contain a statement underSection 237(2) or (3) of the Companies Act 1985 as amended. 3. An interim dividend of 2.45p per share, amounting to £77,000, will bepaid on 14th December 2006 to those Shareholders on the register at 1st December2006. A final dividend of 6.0p per share in respect of the year ended 25thMarch 2006, was paid to Shareholders on 3rd August 2006 and the cost amountingto £189,000 has been included in the Profit and Loss Account for the half yearended 29th September 2006. 4. This interim report is being posted to all Shareholders and will beavailable free of charge until 31st December 2006 on application to theCompany's registered office at Cleary Court, 21 St. Swithin's Lane, London EC4N8AD. This information is provided by RNS The company news service from the London Stock Exchange