Final Results - 2 of 2
London & Associated Properties PLC
Consolidated income statement for the year ended 31 December 2007
2007 2006
Notes £'000 £'000
Gross rental income
Group and share of joint ventures 14,260 11,840
Less: joint ventures - share of rental (1,228) (3,949)
income
13,032 7,891
Direct property expenses (2,481) (1,107)
Overheads (4,974) (3,623)
Property overheads (7,455) (4,730)
Net rental income 5,577 3,161
Listed investments 144 264
Costs of evaluation (339) (1,849)
Goodwill impairment (173) (7,483)
Costs in relation to acquisition 1 (512) (9,332)
Profit on sale of subsidiary - 52
investments
Profit on sale of investment properties 2,295 -
Net (decrease)/increase on revaluation (25,208) 21,610
of investment properties
Net (decrease)/increase in value of (16) 680
investments held for trading
Operating (loss)/profit (17,720) 16,435
Share of profit of joint ventures 1572 4,358
Share of (loss)/profit of associate (448) 972
(16,596) 21,765
Interest receivable 2 1,583 742
Interest payable 2 (8,874) (4,182)
(Loss)/profit before taxation (23,887) 18,325
Income tax 3 11,384 (3,107)
(Loss)/profit for the year (12,503) 15,218
Basic (loss)/earnings per share 5 (16.40p) 20.00p
Diluted (loss)/earnings per share 5 (16.40p) 19.97p
Consolidated balance sheet at 31 December 2007
2007 2006
Notes £'000 £'000
Non-current assets
Market value of properties attributable 248,076 192,788
to group
Present value of head leases 31,671 9,340
Property 8 279,747 202,128
Plant and equipment 881 1,033
Investments in joint ventures 1,881 15,263
Investments in associated company 6,401 6,872
Held to maturity investments 5 1,834
288,915 227,130
Current assets
Trade and other receivables 7,214 3,849
Financial assets-investments held for 5,113 4,992
trading
Cash and cash equivalents 16,464 14,555
28,791 23,396
Total assets 317,706 250,526
Current liabilities
Financial liabilities-borrowings (6,250) (5,693)
Trade and other payables (12,988) (11,434)
Current tax liabilities (1,869) -
(21,107) (17,127)
Non current liabilities
Financial liabilities-borrowings (162,866) (99,976)
Present value of head leases on (31,671) (9,340)
properties
Deferred tax (13,071) (22,223)
(207,608) (131,539)
Total liabilities (228,715) (148,666)
Net assets 88,991 101,860
Equity
Share capital 8,232 8,232
Share premium account 5,236 5,236
Fair value reserve 1,001 -
Translation reserve in associate (530) (517)
Capital redemption reserve 47 47
Other reserves 429 429
Retained earnings (excluding treasury 81,125 94,966
shares)
Treasury shares (6,549) (6,533)
Retained earnings 74,576 88,433
Total shareholders' equity 88,991 101,860
Net assets per share 6 116.86p 133.62p
Diluted net assets per share 6 116.73p 133.47p
Consolidated statement of recognised income and expense
for the year ended 31 December 2007
2007 2006
£'000 £'000
(Loss)/profit for the year (12,503) 15,218
Currency translation in associate (13) (541)
Fair value on interest derivatives 1,388 -
Deferred tax thereon (387) -
Total recognised income and expense for the year (11,515) 14,677
Consolidated statement of changes in shareholders' equity
for the year ended 31 December 2007
Retained Earnings
Fair Earnings
Share Share Translation Other value Treasury excluding Total
capital premium reserves reserves reserve shares treasury equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 8,232 5,228 24 476 - (6,632) 81,013 88,341
1 January
2006
Investment - - - - - - 24 24
valuation
in joint
venture
Equity - - - - - - 44 44
share
options in
associate
Acquisition - - - - - (40) - (40)
of own
shares
Disposal of - - - - - 139 - 139
own shares
Gain/(loss) - 8 - - - - (20) (12)
on disposal
of own
shares
Currency - - (541) - - - - (541)
translation
in
associate
Dividend - - - - - - (1,313) (1,313)
Profit for - - - - - - 15,218 15,218
year
Balance at 8,232 5,236 (517) 476 - (6,533) 94,966 101,860
31 December
2006
Retained Earnings
Fair Earnings
Share Share Translation Other value Treasury excluding Total
capital premium reserves reserves reserve shares treasury equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 8,232 5,236 (517) 476 - (6,533) 94,966 101,860
1 January
2007
Equity - - - - - - 99 99
share
options in
associate
Fair value - - - - 1,001 - - 1,001
of interest
derivatives
(net of
deferred
tax)
Acquisition - - - - - (278) - (278)
of own
shares
Disposal of - - - - - 262 - 262
own shares
Loss on - - - - - - (27) (27)
disposal of
own shares
Currency - - (13) - - - - (13)
translation
in
associate
Dividend - - - - - - (1,410) (1,410)
Loss for - - - - - - (12,503) (12,503)
year
Balance at 8,232 5,236 (530) 476 1,001 (6,549) 81,125 88,991
31 December
2007
Other reserves includes capital redemption reserve of £47,000 (2006:£47,000).
Consolidated cash flow statement for the year ended 31 December 2007
2007 2006
£'000 £'000 £'000 £'000
Operating activities
Operating (loss)/profit (17,720) 16,435
Depreciation 201 178
Goodwill impairment 173 7,483
Costs of evaluation 339 1,849
Costs in relation to acquisition 512 9,332
Loss/(gain) on disposal of non-current assets 9 (30)
Profit on sale of investment properties (2,295) -
Profit on sale of subsidiary investments - (52)
Net decrease/(increase) on revaluation of 25,208 (21,610)
investment properties
Net decrease/(increase) in value of 16 (680)
investments held for trading
Increase in net current assets (1,966) (129)
Cash generated from operations 3,965 3,444
Interest paid (9,303) (4,980)
Interest received 1,916 757
Income tax paid (3,420) (359)
Cash flows after interest and tax (6,842) (1,138)
Investing activities
Repayment of investment in loan stock in - 1,950
joint ventures
Acquisition of subsidiary investments (net of (11,097) (27,313)
cash acquired)
Costs on acquisition of subsidiary (339) (1,849)
investments
Sale of subsidiary investments - 1,695
Property acquisitions and improvements (22,455) (2,656)
Sale of properties 43,804 1,453
Purchase of office equipment and motor cars (104) (204)
Sale of office equipment and motor cars 29 61
Dividends received 3,343 7,248
Cash flows from investing activities 13,181 (19,615)
Financing activities
Purchase of Treasury shares (278) (40)
Sale of Treasury shares 235 127
Equity dividends paid (1,410) (1,313)
Debt repaid on acquisition of subsidiary - (23,375)
investments
(Repayment)/drawdown of short term loan from (163) 2,600
joint ventures
(Repayment)/drawdown of medium term bank loan (3,371) 47,850
Cash flows from financing activities (4,987) 25,849
Net increase in cash and cash equivalents 1,352 5,096
Cash and cash equivalents at beginning of 8,862 3,766
period
Cash and cash equivalents at end of period 10,214 8,862
Cash and cash equivalents
For the purpose of the cash flow statement,
cash and cash
equivalents comprise the following balance
sheet amounts:
2007 2006
£'000 £'000
Cash and cash equivalents 16,464 14,555
Bank overdraft (6,250) (5,693)
Cash and cash equivalents at end of period 10,214 8,862
£9.5m of cash deposits at 31 December 2007 was charged as security to the
Prudential. This has been released since the year end.
Notes to the preliminary announcement
for the year ended 31 December 2007
Basis of Accounting
The results for the year ended 31 December 2007 have been prepared in
accordance with International Financial Reporting Standards (IFRS) as adopted
by the European Union. The principal accounting policies applied are the same
as those set out in the Financial Statements for the year ended 31 December
2006.
1.Exceptional items
2,007 2006
£'000 £'000
Costs in relation to acquisition:
Costs of evaluation (339) (1,849)
Goodwill impairment (173) (7,483)
Analytical Group (2006:London Portfolio) (512) (9,332)
The costs of evaluation represents fees incurred by the Company, prior to the
decision being taken that the company should acquire the 50% interest in the
issued share capital of Analytical Properties Holdings Limited (Analytical
Group) not already owned by the Company.
Goodwill impairment arose on the acquisition of Analytical Group on 25
September 2007. This goodwill arose primarily as a result of recognising the
deferred tax which would arise if the properties within Analytical Group were
realised at the fair valuation applied on acquisition. This goodwill is
immediately written off to the income statement. The company also acquired £
1,829,000 of B loan stock of Analytical Group at par value.
2. Net finance costs
2007 2006
£'000 £'000
Interest receivable 1583 742
Interest payable -
Interest on bank loans and overdrafts (6,083) (2,839)
Other loans (3,138) (2,124)
Interest on obligations under finance (798) 36
leases
Interest capitalised 1,145 745
(8,874) (4,182)
(7,291) (3,440)
3. Income tax
2007 2006
£'000 £'000
Current tax (1,721) -
Deferred tax 13,105 (3,107)
11,384 (3,107)
4. Acquisition of Analytical Properties Holdings Limited-balance of 50 per cent
of share capital
As the Group now owns 100 per cent of Analytical Properties Holdings Limited
(APHL), it has been accounted for as a business combination.
The Group acquired the remaining 50 per cent of the issued share capital of
APHL for a consideration of £11.87m, including costs. The original holding of
50 per cent was treated as a joint venture previously and as it was acquired on
the formation of APHL, there is no goodwill relating to this ownership.
Purchase consideration: £'000
Cash paid-balance of 50 per 11,793
cent ordinary shares
Add: Direct costs relating to 82
the acquisition
Total net cost of acquisition 11,875
Fair value of net assets (11,702)
acquired-50 per cent
Goodwill 173
Net assets at fair value: Book value Fair value Fair value
at of
acquisition adjustments acquisition
£'000 £'000 £'000
Investment properties 97,092 1,165 98,257
Cash and cash equivalents 3,958 - 3,958
Debtors 2,071 40 2,111
Current liabilities (7,687) 437 (7,250)
Non current liabilities (69,667) (437) (70,104)
Deferred tax - (3,569) (3,569)
25,767 (2,364) 23,403
5. (Loss)/Earnings per share
2007 2006
£'000 £'000
(Loss)/profit after tax (12,503) 15,218
Weighted average number of shares in 76,230 76,102
issue for the period (`000)
Basic (loss)/earnings per share (16.40p) 20.00p
Diluted number of shares in issue re. 76,230 76,205
outstanding share options(`000)
Fully diluted (loss)/earnings per share (16.40p) 19.97p
Weighted average number of shares in issue is calculated after excluding
treasury shares of 6,167,545.
On the basis that the Group has made a loss for the year there is no dilutive
effect of the outstanding options.
6. Net assets per share
2007 2006
£'000 £'000
Shares in issue (`000) 76,149 76,229
Net assets per balance sheet 88,991 101,860
Basic net assets per share 116.86p 133.62p
Shares in issue diluted by outstanding 76,269 76,349
share options (`000)
Net assets after issue of share options 89,031 101,900
Fully diluted net assets per share 116.73p 133.47p
7.Dividend
2007 2006
Per £'000 Per share £'000
share
Dividends paid during the year relating 1.85p 1,410 1.725p 1,313
to the prior year
An interim dividend for 2007 of 0.65p amounting to £497,000 was paid on 25
January 2008 (2006: 0.6p amounting to £457,000). The directors recommend the
payment of a final dividend for 2007 of 1.30p per ordinary share (2006: 1.25p)
amounting to £990,000 (2006: £953,000), making the total dividend for 2007
1.95p amounting to £1,487,000 (2006:1.85p amounting to £1,410,000). The final
dividend will be payable on 4 July 2008 to shareholders registered at the close
of business on 30 May 2008.
8.Revaluation of investment properties
99.9% of freehold and long leasehold properties were valued as at 31 December
2007 by external professional firms of chartered surveyors, the balance being
valued by the directors.
The valuations were made at open market value on the basis of existing use.
9.Financial information
The figures for the year ended 31 December 2006 are based on the audited
accounts for that year, which have been delivered to the Registrar of Companies
and on which the Auditors gave an unqualified report and did not contain a
statement under Section 498(2) and (3) of the Companies Act 2006.
The financial information set out in this preliminary announcement, which was
approved by the Board of London & Associated Properties PLC on 28th March 2008,
is unaudited and does not constitute the Group's statutory accounts for the
year ended
31 December 2007, but is derived from those accounts.
Friday, 10th January 2025
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