Final Results
28 May 2015
ENERGISER INVESTMENTS PLC
("Energiser" or "the Group")
FINAL RESULTS FOR THE YEAR ENDED 31 DECEMBER 2014
CHAIRMAN��S STATEMENT
Introduction
I am pleased to report on the Group's trading for the year ended 31 December
2014 in my first statement to Shareholders since my appointment on 26 February
2015.
As mentioned in the last annual report, the Board has taken the decision to
focus on the property sector and is continuing with its two major projects in
that area: a rental portfolio in Wellingborough and mezzanine funding to a
housebuilder for a development in Surrey. The property market in the United
Kingdom has continued to recover over the past year. This recovery has
contributed to the increase in the value of the Wellingborough property
portfolio by £76,000 and had a similar positive impact on the development in
Surrey.
Results
The 20 houses in Wellingborough generated gross rental income of £148,000
(2013: £147,000) and, after associated operating costs, resulted in net rental
income of £112,000 (2013: £113,000). A cost accrual of £28,000 made in a prior
year has been reversed as it is no longer required and there has been a fair
value adjustment of £76,000 due to the market value of the properties
increasing. Administrative expenses have decreased to £50,000 (2013: £73,000)
and finance costs have risen to £322,000 (2013: £102,000) due to the interest
accrued on the funding from investors referred to below. The loss before and
after taxation was £147,000 (2013: profit of £36,000) with a loss per share of
0.34p (2013: earnings per share of 0.08p).
Despite the loss generated during the year, net assets have increased to £
598,000 (2013: £205,000) due to the recognition of the fair value of the profit
share anticipated on the mezzanine funding provided to the housebuilder. This
results in a net asset value per share of 1.69p (2013: 0.47p). Net asset value
per share is calculated by dividing the net assets of the Group by the number
of ordinary shares in existence at the balance sheet date.
The Directors do not recommend the payment of a dividend.
Operations
The Group's investment portfolio in Wellingborough, Northamptonshire is
currently fully tenanted and the properties will continue to be let on short
term tenancies.
The Group has invested its commitment of £2.7m of mezzanine funding for a 12
unit development in Kingswood, Surrey by a housebuilder. Construction will be
completed in the summer and sales will commence shortly. Gross development
value has increased to £8.9m since last reported. Energiser procured the funds
from investors who will receive a coupon of 10% per annum. The Group is
entitled to 50% of the net profit generated by the development and will receive
a priority return of £785,000, as long as the development makes sufficient
profit.
The Group has an investment in EiRx Therapeutics plc, which has been fully
provided against in previous years. The company has now been placed in
creditors' voluntary liquidation and the Report to Creditors and Members has
been circulated by the liquidator. In view of the report, the Board is of the
opinion that the investment should continue to be fully provided against.
Outlook
The Group is now re-building shareholders' funds by way of its current
activities and it is expected that this will continue for the foreseeable
future.
Stephen Wicks
26 May 2015
GROUP STRATEGIC REPORT
Results and performance
The results of the Group for the year show a loss on ordinary activities before
and after taxation of £147,000 (2013: profit of £36,000). The shareholders'
funds for the Group total £598,000 (2013: £205,000). The Directors do not
recommend the payment of a dividend for the year ended 31 December 2014.
The performance of the rental investment during 2014 was similar to that of
2013, with almost 100% occupancy on the rental properties. During the year the
Group advanced a further £1.3m to a housebuilder under a mezzanine finance
agreement. The Group has provided £2.7m (2013: £1.4m) towards the development
of 12 units in Surrey and it is entitled to receive 50% of the net profit of
the development including a priority return of £785,000, subject to the
development making sufficient profit. The majority of the funding has been
procured from investors at a cost of 10% per annum.
Key performance indicators ('KPIs')
The Group's KPIs are the return on project investment and the net assets
position of the Group including net assets per share. These indicators are
monitored by the Board and the details of performance against these are given
below.
2014 2013
Return on project investment £112,000 £113,000
Net assets £598,000 £205,000
Net assets per ordinary share 1.37p 0.47p
Going concern
The financial statements have been prepared on the going concern basis, the
Directors having considered the cash forecasts for the next twelve months from
the date of the approval of these financial statements. In doing so they have
given due regard to the risks and uncertainties affecting the business, the
liquidity risk, financial support provided by Mr S D Wicks, who has undertaken
to meet the cash needs of the Group if required, and the repayment of other
loans. On this basis the Directors have a reasonable expectation that the funds
available to the Group are sufficient to meet the requirements indicated by
those forecasts.
By order of the Board
Nishith Malde
Company Secretary
26 May 2015
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2014
2014 2013
£'000 £'000
Continuing operations
Revenue arising in the course of ordinary activities 148 147
Development costs - (17)
Cost of sales 68 66
Gross profit 216 196
Administrative expenses (50) (73)
Operating profit 166 123
Finance costs (322) (102)
Finance income 9 15
(Loss)/profit before taxation (147) 36
Taxation - -
(Loss)/profit for the year attributable to (147) 36
shareholders of the Company
Other comprehensive income
Items that may be subsequently reclassified to profit
or loss
change in value of available-for-sale financial 684 -
assets
Related deferred taxation (144) -
Other comprehensive income for the year, net of tax 540 -
Total comprehensive income for the year attributable 393 36
to shareholders of the Company
(Loss)/earnings per share
Basic and diluted (loss)/earnings per share from (0.34)p 0.08p
total and continuing operations
Diluted (loss)/earnings per share is taken as equal to basic (loss)/earnings
per share as the Group's average share price during the period is lower than
the exercise price of the share options and therefore the effect of including
share options is anti-dilutive.
GROUP STATEMENT OF FINANCIAL POSITION
As at 31 December 2014
2014 2013
£'000 £'000
ASSETS
Non-current assets
Investment property 2,742 2,666
Financial assets held at fair value through profit or 1 1
loss
2,743 2,667
Current assets
Trade and other receivables 9 15
Available-for-sale financial assets 3,343 1,400
Cash and cash equivalents 13 10
3,365 1,425
Total assets 6,108 4,092
LIABILITIES
Current liabilities
Trade and other payables 564 359
Short-term borrowings 4,794 2,311
Deferred tax 144 -
5,502 2,670
Non-current liabilities
Long-term borrowings - 1,200
Financial liabilities held at fair value through profit 8 17
or loss
8 1,217
Total liabilities 5,510 3,887
Net assets 598 205
EQUITY
Share capital 2,312 2,312
Share premium account 5,747 5,747
Convertible loan 88 88
Merger reserve 1,012 1,012
Revaluation reserve 540 -
Retained earnings (9,101) (8,954)
Total equity 598 205
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2014
Share
Share premium Convertible Merger Revaluation Retained Total
capital account loan reserve reserve earnings equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
At 1 January 2013 2,312 5,747 88 1,012 - (8,990) 169
Total comprehensive - - - - - 36 36
loss
Balance at 31 December 2,312 5,747 88 1,012 - (8,954) 205
2013
Total comprehensive - - - - 540 (147) 393
income
Balance at 31 December 2,312 5,747 88 1,012 540 (9,101) 598
2014
GROUP STATEMENT OF CASH FLOWS
For the year ended 31 December 2014
2014 2013
£'000 £'000
Cash flows from operating activities
(Loss)/profit before and after taxation (147) 36
Adjustments for:
Fair value adjustment on financial liabilities recognised in (9) (15)
profit or loss
Fair value adjustment on investment property (76) -
Interest expense 322 102
Decrease/(increase) in trade and other receivables 6 (1)
Decrease in trade payables (60) (23)
Reversal of impairment of inventories - (100)
Net cash generated by/(used in) operating activities 36 (1)
Cash flows from investing activities
Mezzanine finance facility issued (1,259) (1,400)
Net cash used in investing activities (1,259) (1,400)
Cash flows from financing activities
Proceeds from borrowings 1,323 1,496
Re-payment of borrowings (40) (39)
Interest paid (57) (53)
Net cash generated by financing activities 1,226 1,404
Net increase in cash and cash equivalents 3 3
Cash and cash equivalents at beginning of period 10 7
Cash and cash equivalents at end of period 13 10
Note:
The financial information set out above does not constitute the Company's
statutory accounts for the years ended 31 December 2014 or 2013 but is derived
from those accounts. Statutory accounts for 2013 have been delivered to the
registrar of companies, and those for 2014 will be delivered in due course. The
auditors have reported on those accounts; their reports were (i) unqualified,
(ii) did not include a reference to any matters to which the auditors
drew attention by way of emphasis without qualifying their report and (iii) did
not contain a statement under section 498 (2) or (3) of the Companies Act 2006
in respect of the accounts for 2013 or 2014.
The AGM will be held at Decimal Place, Chiltern Avenue, Amersham,
Buckinghamshire, HP6 5FG at 11.00 am on 29 June 2015.
The Company's Annual Report and Accounts will be posted to shareholders shortly
and will be available to view and download on the Company's website at http://
www.energiserinvestments.co.uk/.
For further information contact:
Energiser Investments plc
Nishith Malde +44 (0) 1494 762450
Cairn Financial Advisers LLP
Jo Turner +44 (0) 20 7148 7900
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