Interim Results

Assura Group Limited 28 November 2007 Assura Group Limited Highlights Unaudited interim report for the nine months ended 30 September 2007 Wednesday 28 November 2007: Assura Group works in partnership with GPs and Health Professionals to deliver property, pharmacy and medical services in primary care. These unaudited second interim results are in respect of the nine month period to 30 September 2007. Assura Group is changing its year end to 31 March and this year will adopt a 15 month period to 31 March 2008. Financial Highlights • Group operating profit £16.1m (2006: £7.6m) • Second interim dividend of 1.75p1 in addition to the interim dividend paid of 2.33p (2006: 2.00p) • Net assets up 5.4% to £281.9m equivalent to 121.0p per Share compared to 114.3p at 31 December 2006 • Basic Earnings per Share rise to 11.79p (2006: 6.04p) Operating Highlights • Nine joint ventures with GPs formed to provide out-patient and diagnostic procedures to a population of over 1m patients2 • 19 pharmacies open2 • Invested or committed £527m across 144 sites of which 23 are currently in solicitors' hands2 • On track to have joint ventures providing services to 1.5m patients, at least 25 pharmacies open and investments or commitments of close to £600m by 31 March 2008 Commenting on today's announcement, Richard Burrell, CEO of Assura said: 'We are encouraged by the multitude of opportunities for locally procured private sector provision in the NHS and the emphasis on patients' rights to have personalised care closer to home. We believe that our integrated business model will ensure that we become one of the UK's leading health care provider organisations giving patients a clinically-led and locally-driven service for outpatient, diagnostic and day case procedures.' Enquiries: Assura Group Limited 020 7017 3800 Richard Burrell, CEO Louise Bathersby, Marketing & Investor Relations Director FD 020 7831 3113 David Yates Ben Atwell Sanjeev Pandya 1 Ex-dividend date 5 December 2007, record date 7 December 2007, payment date 9 January 2008. 2 As at 26 November 2007. Assura Group Limited Chief Executive's Statement Unaudited interim report for the nine months ended 30 September 2007 This unaudited Second Interim Report is published in respect of the nine months to 30 September 2007. Results I am pleased to report good progress since our last set of interim results were published in September in all three of our divisions - Property, Pharmacy and Medical. During the period, total revenue amounted to £22.5m (2006: £10.5m) producing a Group operating profit of £16.1m (2006: £7.6m). Included in the Group operating profit is an unrealised surplus on revaluation of investment property of £11.2m (2006: £7.6m). The Pharmacy Division which is expected to be EBITDA positive next year, earned a gross profit of £2.5m on sales of £9.1m and the Medical Division, which is expected to be EBITDA positive the year after, has now started to generate revenue in some of its joint venture partnerships. In the meantime, the Group continues to finance the expansion of these divisions from its rental income and development surpluses. Rent received in the nine months ended 30 September 2007 amounted to £9.9m (2006: £7.7m), the rent roll at 30 September 2007 was £13.5m and the rent roll at 26 November 2007 has now risen to £16.6m as a result of several medical centre developments completing since 30 September 2007. A second interim dividend of 1.75p per Ordinary Share has been declared to shareholders on the register as at 7 December 2007 (ex-dividend date 5 December 2007), in addition to the interim dividend paid of 2.33p. In the absence of unforeseen circumstances the Company intends to pay a final dividend in respect of the 15 month period to 31 March 2008. Financing Net asset value as at 30 September 2007 was up 5.4% to £281.9m equivalent to 121.0p per Ordinary Share on a fully diluted basis compared to 114.3p at 31 December 2006. Net debt as at 30 September 2007 was £102.2m. The Company's principal short-term loan facility has been increased from £100m to £165m. The interest rate margin on this is 0.65% and the Company benefits from an interest rate swap which is currently £150m, but rises to £200m at 31 December 2007, for 20 years at 4.59%. National Australia Bank has recently approved a new five year £250m facility utilising its low cost securitisation conduit for which the legal documentation is being processed and draw down will be available in the first quarter of 2008. The margin on this facility will be 0.45%. While such a facility is dependent upon the bank's securitisation conduit being able to issue commercial paper, the bank provides a liquidity facility of £255m in addition to guarantee funding in the event of market disruption impacting on the issue of commercial paper. Whilst the above arrangements provide significant headroom, we are in discussions with our bankers to increase our facilities further next year. Operating review During the last three months, the Group has demonstrated its resilience to three key market factors namely: the declining commercial property market; category ' M' pricing for certain pharmaceutical products; and the recent Government announcements regarding the cancellation of certain Independent Sector Treatment Centre (ISTC) contracts. As at 30 June 2007, investment property on the Company's balance sheet was independently valued by Savills Commercial Limited at a net initial yield of 5.31% representing a net equivalent yield of 5.75%. Whilst the wider commercial property market has experienced declines since the summer, we continue to believe that our overall valuation yield remains appropriate at the current time. Assura's properties are generally let on long leases where rent is predominantly reimbursed out of the NHS annual budget. At the same time, rental growth, as evidenced by recent rent review settlements, continues to average in excess of 4% per annum. The weighted average unexpired term is currently 18.75 years. The yield on cost of all capital commitments continues to average 6% and whilst revaluation surpluses have been credited on completed properties, there remain ongoing revaluation surpluses on committed projects and development properties still under construction. The Pharmacy Division continues to expand the number of branches and will meet or exceed its 20 opening target by the end of this calendar year. It expects to have at least 25 open by the end of March 2008 and at least 40 by the end of 2008. In spite of a gross margin decline as a result of the Category 'M' pricing regime, the Group continues to achieve a gross margin in excess of 28% and is on target to achieve 30% by 2009. This is supported by our integrated pharmacy model where additional services income is assisting gross margin performance. We are continuing to progress plans for a direct to consumer channel for the pharmacy business and this concept will be piloted over the coming months. This model will provide patients with a convenient and efficient way of taking delivery of their medicines at their home or place of work in addition to physical branch locations. The Medical Division is continuing to form joint venture partnerships with GPs and locality groups and has now formed nine joint ventures serving over 1m patients. Out-patient services have commenced for four different specialties in three joint ventures and we remain focused on expanding the number of services provided across our joint ventures and signing up the new partnerships which are in our pipeline. We are also finding opportunities to expand or 'swell' our existing joint venture partnerships with GPs who did not join at the time of their formation. We remain on target to have joint ventures serving 1.5m patients by the end of March 2008 and 5.0m patients by the end of 2010. We are finding that good progress is being made within Primary Care Trusts (PCTs) to implement the 'Any Willing Provider' guidance and we continue to work with the PCTs and Acute Trusts in order to enable efficient implementation of locally procured services. By engaging as a 'willing provider' the Company is not reliant upon centrally procured contracts with guaranteed volumes and tariffs which may subsequently be revoked, such as those awarded to the ISTCs. Industry trends and outlook The Government is committed to the private sector playing a role in the improvement of primary care services and has recently published guidance to allow private and NHS providers to be on a level playing field. We are encouraged by the multitude of opportunities for locally procured private sector provision in the NHS and the emphasis on patients' rights to have personalised care closer to home. We believe that our integrated business model will ensure that we become one of the UK's leading health care provider organisations giving patients a clinically-led and locally-driven service for out-patient, diagnostic and day case procedures. We are also encouraged by plans for the reform of the NHS and Lord Darzi's recommendation that a network of polyclinics be created to 'provide a new kind of community based care at a level that falls between the current general practice and the traditional district general hospital'. Subsequent to this, Lord Darzi's Interim Report on his review of the NHS in England calls for an expansion of the 'one stop shop' model of primary care with new health centres offering community based services to meet local need. The Secretary of State has announced new funding to help secure this vision and to deliver 150 GP-run health centres around the country which will be open for extended hours. This mirrors our national strategy to support and increase the provision of out-patient and diagnostic services close to patient homes through investment in GP support services and facilities thereby enabling our joint venture GP groups to become highly effective provider organisations. Richard Burrell Chief Executive Officer 27 November 2007 Assura Group Limited Independent Review Report to Assura Group Limited For the period from 1 January 2007 to 30 September 2007 Introduction We have been engaged by the Company to review the financial information for the nine months ended 30 September 2007 in the interim financial report which comprises the Unaudited Consolidated Income Statement, Unaudited Consolidated Balance Sheet, Unaudited Consolidated Statement of Changes in Equity, Unaudited Consolidated Cash Flow Statement, and the related notes 1 to 22. We have read the other information contained in the interim financial report and considered whether it contains any apparent mis-statements or material inconsistencies with the financial information. This report is made solely to the Company in accordance with guidance contained in ISRE 2410 (UK and Ireland) 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our work, for this report, or for the conclusions we have formed. Directors' responsibilities The interim financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the interim financial report in accordance with the Listing Rules of the United Kingdom's Financial Services Authority, which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. The annual financial statements of the Group are prepared in accordance with International Financial Reporting Standards (IFRS). The financial information included in this interim financial report has been prepared in accordance with the Listing Rules of the United Kingdom's Financial Services Authority. Our responsibility Our responsibility is to express to the Company a conclusion on the financial information in the interim financial report based on our review. Scope of review We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believe that the financial information for the nine months ended 30 September 2007 is not prepared, in all material respects, in accordance with the accounting policies outlined in Note 2, which comply with IFRS and which the group intends to apply in its financial statements for the period ended 31 March 2008, and in accordance with the Listing Rules of the United Kingdom's Financial Services Authority. Ernst & Young LLP Guernsey, Channel Islands 27 November 2007 Assura Group Limited Unaudited Consolidated Income Statement For the period from 1 January 2007 to 30 September 2007 1/01/2007 1/01/2006 to to 30/09/2007 30/09/2006 Unaudited Unaudited Notes £'000 £'000 Revenue 4 22,542 10,521 Cost of sales 5 (8,020) (1,496) ______ ______ Gross profit 14,522 9,025 Administrative expenses 6 15,113 7,330 Other expenses 7 2,431 594 _____ _____ 17,544 7,924 _____ _____ Group trading (losses)/profit (3,022) 1,101 Unrealised surplus on revaluation of investment property 8 11,177 7,645 Share of post tax profits of associates and joint ventures accounted for using the equity method 9 1,978 - _____ _____ Group operating profit before exceptional items 10,133 8,746 Exceptional pharmacy establishment cost 10 - (1,105) Termination of investment management services Fees received after payment to sub-advisers and other expenses 13,844 - Goodwill impairment (7,914) - 11 5,930 - _____ _____ Group operating profit from continuing operations 16,063 7,641 Finance revenue 12 11,233 5,081 Finance costs 13 (1,029) (1,209) _____ _____ 10,204 3,872 _____ _____ Profit before taxation 26,267 11,513 Taxation (1) (17) _____ _____ Profit for the period from continuing operations 26,266 11,496 _____ _____ Discontinued operations Profit/(loss) for the period from discontinued operations 14 155 (154) _____ _____ Profit for the period 26,421 11,342 _____ _____ Profit for the year attributable to: Equity holders of the parent 26,637 11,166 Minority interest (216) 176 _____ _____ 26,421 11,342 _____ _____ Earnings per share (pence) Basic earnings per share on profit for the period 17 11.79p 6.04p Diluted earnings per share on profit for the period 17 11.55p 6.00p Dividend per share 15 4.00p 3.34p The accompanying notes on pages 12 to 16 form an integral part of the financial statements Assura Group Limited Unaudited Consolidated Balance Sheet As at 30 September 2007 30/09/2007 30/09/2006 31/12/2006 Unaudited Unaudited Audited Notes £'000 £'000 £'000 Non-current assets Investment property 8 248,147 177,439 213,132 Development property 62,663 39,551 35,231 Investment in associates 4,511 1,888 1,070 Investment in joint ventures 483 - 869 Intangible assets 34,571 35,279 36,998 Property, plant and equipment 11,556 2,529 5,973 Available for sale financial assets 9,446 - - Other investments 500 - 250 Derivative financial instruments at fair value 12,708 832 2,202 _____ _____ _____ 384,585 257,518 295,725 _____ _____ _____ Current assets Cash and cash equivalents 13,448 13,322 18,842 Debtors 15,519 9,592 9,892 Pharmacy inventories 1,131 599 567 Property work in progress 1,522 10,943 3,239 _____ _____ _____ 31,620 34,456 32,540 _____ _____ _____ Total assets 416,205 291,974 328,265 _____ _____ _____ Current liabilities Bank overdraft 4,489 - 2,135 Creditors 16,468 10,137 11,793 Corporate tax and other taxes 894 322 599 _____ _____ _____ 21,851 10,459 14,527 _____ _____ _____ Non-current liabilities Long-term loan 111,202 16,996 44,949 Payments due under finance lease 1,219 1,312 1,289 _____ _____ _____ 112,421 18,308 46,238 _____ _____ _____ Total liabilities 134,272 28,767 60,765 _____ _____ _____ Net assets 281,933 263,207 267,500 _____ _____ _____ Represented by: Capital and reserves Share capital 18 22,640 22,593 22,593 Share premium 697 226,984 226,678 Distributable reserve 227,419 20,244 15,564 Retained earnings 30,494 (6,568) 1,852 Revaluation reserve 683 - 106 Deferred consideration reserve - - 790 _____ _____ _____ 281,933 263,253 267,583 _____ _____ _____ Minority interests - (46) (83) _____ _____ _____ Total equity 281,933 263,207 267,500 _____ _____ _____ Basic net asset value per Ordinary Share 19 124.53p 116.50p 118.40p _____ _____ _____ Diluted net asset value per Ordinary Share 19 121.01p 112.48p 114.32p _____ _____ _____ The unaudited financial statements on pages 7 to 11 were approved at a meeting of the Board of Directors held on 27 November 2007 and signed on its behalf by: Dr John Curran Peter Pichler Deputy Chairman Director The accompanying notes on pages 12 to 16 form an integral part of the financial statements. Assura Group Limited Unaudited Consolidated Statement of Changes in Equity For the period from 1 January 2007 to 30 September 2007 Share Share Distributable Retained Capital Premium Reserve Earnings £'000 £'000 £'000 £'000 1 January 2007 22,593 226,678 15,564 1,852 Revaluation of land & buildings - - - - Net gains on available for sale financial assets - - - - Profit/(loss) attributable to equity holders and minority interest - - - 26,637 Total income and expense for the period - - - 26,637 Issue of Ordinary Shares 47 697 - - Deferred share-based consideration - - - - Transfer from share premium1 - (226,678) 226,678 - Dividends on Ordinary Shares - - (14,823) - Minority interest disposed of in period - - - (299) Cost of employee share-based incentives - - - 2,304 _____ _____ _____ _____ 30 September 2007 22,640 697 227,419 30,494 _____ _____ _____ _____ 1 January 2006 14,240 122,240 - (18,328) Profit attributable to equity holders and minority interest - - - 11,166 Total income and expense for the period - - - 11,166 Issue of Ordinary Shares, net of costs 9,160 129,744 - - Treasury shares (807) - - - Transfer from share premium2 - (25,000) 25,000 - Dividends on Ordinary Shares - - (4,756) - Cost of employee share based incentives - - - 594 _____ _____ _____ _____ 30 September 2006 22,593 226,984 20,244 (6,568) _____ _____ _____ _____ Revaluation Minority Deferred Total Reserve Interest Consideration Reserve £'000 £'000 £'000 £'000 1 January 2007 106 (83) 790 267,500 Revaluation of land & buildings 417 - - 417 Net gains on available for sale financial assets 160 - - 160 Profit/(loss) attributable to equity holders and minority interest - (216) - 26,421 Total income and expense for the period 577 (216) - 26,998 Issue of Ordinary Shares - - - 744 Deferred share-based consideration - - (790) (790) Transfer from share premium1 - - - - Dividends on Ordinary Shares - - - (14,823) Minority interest disposed of in period - 299 - - Cost of employee share-based incentives - - - 2,304 _____ _____ _____ _____ 30 September 2007 683 - - 281,933 _____ _____ _____ _____ 1 January 2006 - (222) - 117,930 Profit attributable to equity holders and minority interest - 176 - 11,342 Total income and expense for the period - 176 - 11,342 Issue of Ordinary Shares, net of costs - - - 138,904 Treasury shares - - - (807) Transfer from share premium2 - - - - Dividends on Ordinary Shares - - - (4,756) Cost of employee share based incentives - - - 594 _____ _____ _____ _____ 30 September 2006 - (46) - 263,207 _____ _____ _____ _____ Share Share Distributable Retained Capital Premium Reserve Earnings £'000 £'000 £'000 £'000 1 January 2006 14,240 122,240 - (18,328) Revaluation of land & buildings - - - - Profit/(loss) attributable to equity holders and minority interest - - - 18,900 Total income and expense for the period - - - 18,900 Issue of Ordinary Shares, net of costs 9,160 129,438 - - Treasury shares (807) - - - Transfer from share premium2 - (25,000) 25,000 - Minority interest acquired in year - - - - Dividends on Ordinary Shares - - (9,436) - Cost of employee share-based incentives - - - 1,280 Deferred share-based consideration - - - - _____ _____ _____ _____ 31 December 2006 22,593 226,678 15,564 1,852 _____ _____ _____ _____ Revaluation Minority Deferred Total Reserve Interest Consideration Reserve £'000 £'000 £'000 £'000 1 January 2006 - (222) - 117,930 Revaluation of land & buildings 106 - - 106 Profit/(loss) attributable to equity holders and minority interest - (471) - 18,429 Total income and expense for the period 106 (471) - 18,535 Issue of Ordinary Shares, net of costs - - - 138,598 Treasury shares - - - (807) Transfer from share premium2 - - - - Minority interest acquired in year - 610 - 610 Dividends on Ordinary Shares - - - (9,436) Cost of employee share-based incentives - - - 1,280 Deferred share-based consideration - - 790 790 _____ _____ _____ _____ 31 December 2006 106 (83) 790 267,500 _____ _____ _____ _____ 1 Following an application to the Royal Court of Guernsey, £226,678,000 was transferred from Share Premium account to Distributable Reserve on 29 June 2007. 2 Following an application to the Royal Court of Guernsey, £25,000,000 was transferred from Share Premium account to Distributable Reserve on 2 June 2006. The accompanying notes on pages 12 to 16 form an integral part of the financial statements Assura Group Limited Unaudited Consolidated Cash Flow Statement For the period from 1 January 2007 to 30 September 2007 1/01/2007 1/01/2006 to to 30/09/2007 30/09/2006 Unaudited Unaudited £'000 £'000 Operating activities Rent received 10,413 7,672 Revenue from pharmacies 9,050 1,116 Fees received 3,629 1,733 Payment received on termination of investment management services 10,698 - Termination payments to sub-advisers (5,901) - Bank and other interest received 730 777 Expenses paid (14,398) (5,089) Purchases by pharmacies (6,518) (810) Interest paid and similar charges (3,093) (1,516) _____ _____ Net cash inflow from operating activities 4,610 3,883 _____ _____ Investing activities Purchase of investment property (20,037) (19,940) Purchase of development property (40,260) (41,667) Purchase of investments (500) - Purchase of property, plant, equipment and intangibles (11,953) (2,779) Debt sold with subsidiary 4,265 - Cost of property work in progress (433) (10,518) Loans advanced to associated companies (1,194) (520) Loan repaid by joint venture 117 - Cash paid on acquisition of subsidiaries - (13,970) Costs incurred on acquisition of subsidiaries - (1,336) Acquisition of subsidiaries - cash acquired - 3,403 _____ _____ Net cash outflow from investing activities (69,995) (87,327) _____ _____ Financing activities Issue of Ordinary Shares 744 110,039 Issue costs paid on issuance of Ordinary Shares - (4,206) Dividends paid (9,360) (4,756) Drawdown of term loan 66,253 56,066 Repayment of term loan - (64,000) Loan issue costs - (123) _____ _____ Net cash inflow from financing activities 57,637 93,020 _____ _____ (Decrease)/increase in cash and cash equivalents (7,748) 9,576 _____ _____ Cash and cash equivalents at 1 January 16,707 3,746 _____ _____ Cash and cash equivalents at 30 September 8,959 13,322 _____ _____ Cash and cash equivalents 13,448 13,322 Bank overdraft (4,489) - _____ _____ Cash and cash equivalents at 30 September 8,959 13,322 _____ _____ The accompanying notes on pages 12 to 16 form an integral part of the financial statements Assura Group Limited Notes to the Unaudited Financial Statements For the period from 1 January 2007 to 30 September 2007 1. The Company was incorporated on 7 October 2003 and commenced trading following Admission of its shares to the Official List of the London Stock Exchange on 21 November 2003. 2. The results for the nine months to 30 September 2007 have been prepared on the basis of the accounting policies that will be in place at 31 March 2008. The results for the nine months to 30 September 2007 and 2006 are unaudited. The interim accounts do not constitute statutory accounts. The balance sheet as at 31 December 2006 has been extracted from the Company's 2006 annual report and financial statements. The auditor has reported on the 2006 accounts and the report was unqualified. Assura Group has extended its year end by three months and will report a 15 month period to 31 March 2008, as a result a second set of interims have been prepared. 3. All revenue and operating profit arose from continuing operations except those included in note 14 below. 4. Revenue 2007 2006 £'000 £'000 Rent receivable 9,863 7,672 Revenue from pharmacies 9,050 1,116 Fund management and other fees receivable 3,629 1,733 _____ _____ 22,542 10,521 _____ _____ 5. Cost of sales 2007 2006 £'000 £'000 Property management expenses 782 680 Purchases by pharmacies 6,518 810 Fund management direct costs 720 6 _____ _____ 8,020 1,496 _____ _____ 6. Administrative expenses 2007 2006 £'000 £'000 Investment Manager's fees - 1,354 Salaries and other staff costs 8,576 3,077 Premises costs 2,218 248 Other administrative expenses 4,319 2,651 _____ _____ 15,113 7,330 _____ _____ Administrative expenses increased from 15 May 2006 when the Company acquired its former fund manager and, from that date, employed its own internal management team. 7. Other expenses 2007 2006 £'000 £'000 Cost of employee share-based incentives 2,431 594 _____ _____ 8. Unrealised surplus on revaluation of investment property The figures for investment properties at 30 September 2007 (based on 30 June 2007 valuation), 30 September 2006 (based on 30 June 2006 valuation) and 31 December 2006 are based on valuations determined by Savills Commercial Limited. 9. Share of post tax profits and losses of associates and joint ventures accounted for using the equity method 2007 2006 £'000 £'000 Share of profits of associates 2,247 - Share of losses of joint ventures (269) - _____ _____ 1,978 - _____ _____ 10. Exceptional pharmacy establishment cost 2007 2006 £'000 £'000 Exceptional pharmacy establishment cost - 1,105 _____ _____ The Company entered into an arrangement with Pharma-e Limited, of which John Curran is a Director and shareholder, to compensate Pharma-e Limited for consultancy services provided to the Group in connection with establishment of the pharmacy business of Assura Pharmacy Limited. The consideration was met by the issue of 650,000 Ordinary Shares in the Company to Pharma-e Limited. 11. Termination of investment management services 2007 2006 £'000 £'000 Fees received 19,985 - Fees payable to sub-advisers (5,901) - Other expenses (240) - Goodwill impairment (7,914) - _____ _____ 5,930 - _____ _____ On 16 August 2007 the Company announced the termination of the investment management services provided by Assura Fund Management LLP, a subsidiary of the Company, to Stobart Group Limited (formerly The Westbury Property Fund Limited), subject to shareholder approval by the latter company. Termination of the services was approved by the shareholders of Stobart Group Limited, at an Extraordinary General Meeting held on 19 September 2007, the profit for the Group from the payment of a termination fee by Stobart Group Limited is after allowance for payments to sub-advisers, taxation and estimated goodwill impairment. That part of the payment which related to a performance fee due to the Company was taken in shares in Stobart Group Limited. As a result the Company holds 6,382,744 (2.7%) Ordinary Shares in Stobart Group Limited which are available for resale subject to a lock-in of two years commencing on the date of issue of the shares. The share price at date of issue was 145.5p and at 30 September 2007 148.0p. 12. Finance revenue 2007 2006 £'000 £'000 Bank and other interest 727 777 Unrealised profit on revaluation of derivative financial instrument 10,506 4,304 _____ _____ 11,233 5,081 _____ _____ The Company has entered into a long-term interest rate swap at a rate of 4.59% on a principal sum of £100m up to 30 June 2007, £150m up to 31 December 2007 and £200m from then until 31 December 2027. Based on the actual 20-year swap rate at 30 September 2007, the fair value of this swap was £12,708,000 at 30 September 2007 (£832,000 at 30 September 2006, £2,202,000 at 31 December 2006). 13. Finance costs 2007 2006 £'000 £'000 Long-term loan interest payable 3,805 1,230 Interest capitalised on developments (2,090) (294) Swap interest (967) (72) Non-utilisation fees 57 142 Amortisation of loan issue costs 201 182 Bank charges 23 21 _____ _____ 1,029 1,209 _____ _____ 14. Discontinued operations On 12 September 2007 the Group disposed of its 70% holding in BHE Developments Limited whose activity was property development for a consideration of £1. The business, which is loss making, is outside the scope of Assura's core business. The results of BHE Developments Limited for the period to 12 September 2007 and 30 September 2006 are presented below : 2007 2006 £'000 £'000 Revenue 36 - Administrative expenses (758) (154) Finance revenue 3 - _____ _____ Loss before taxation (719) (154) Gain on disposal of discontinued operations 874 - _____ _____ Profit/(loss) for the period from discontinued operations 155 (154) _____ _____ At the date of disposal the net liabilities of BHE Developments were £874,000, and the net assets of the company at 30 September 2006 were £56,000. The net cash outflow to the date of disposal was £719,000 and for the period to 30 September 2006 was £154,000. 15. Dividends paid on Ordinary Shares Number of Rate 2007 Number of Rate 2006 Ordinary Shares Ordinary pence £'000 Shares pence £'000 Final dividend for 2006 paid 4 May 233,998,471 4.00 9,360 142,403,847 3.34 4,756 2007 (declared 27 March 2007) _____ _____ _____ _____ Dividends paid 4.00 9,360 3.34 4,756 _____ _____ _____ _____ 16. On 18 September 2007 an interim dividend for 2007 of 2.33p per Ordinary Share, to be paid out of Distributable Reserves, was declared to shareholders on the register at 28 September 2007 giving a total amount of £5,463,000 based on 234,463,115 shares currently in issue. This has been accrued for in the accounts as it was paid on the 19 October 2007. 17. The basic profit per Ordinary Share is based on the profit attributable to equity holders of the parent for the period of £26,637,000 (2006: £11,166,000) and on 225,960,636 Ordinary Shares (2006: 184,850,330), being the weighted average number of Ordinary Shares in issue in the respective period, excluding treasury shares. The diluted profit per Ordinary Share is based on the profit for the period of £26,637,000 (2006: £11,166,000) and on 230,624,040 Ordinary Shares (2006: 186,116,374), being the weighted average number of Ordinary Shares in issue in the respective period, excluding treasury shares. 18. Share capital £'000 Consolidated and Company Authorised 300,000,000 Ordinary Shares of 10p each 30,000 20,000,000 Preference Shares of 10p each 2,000 _____ 32,000 _____ 2007 2006 Number of Share Number of Share Shares Capital Shares Capital £'000 £'000 Ordinary Shares issued and fully paid At 1 January 233,998,471 23,400 142,403,847 14,240 Issued in period 464,644 47 91,594,624 9,160 _____ _____ _____ _____ 234,463,115 23,447 233,998,471 23,400 Treasury shares (8,066,768) (807) (8,066,768) (807) _____ _____ _____ _____ Total Share Capital 226,396,347 22,640 225,931,703 22,593 _____ _____ _____ _____ The treasury shares were issued in May 2006 to the Assura Group Limited Employee Benefit Trust and are held for the purposes of the Assura Group Limited Executive Incentive Plan. 19. The basic net asset value per Ordinary Share is based on the net assets attributable to the ordinary shareholders of £281,933,000 (30 September 2006 £263,207,000, 31 December 2006: £267,500,000) and on 226,396,347 (30 September 2006: 225,931,703, 31 December 2006: 225,931,703) Ordinary Shares in issue at the balance sheet date excluding treasury shares. The diluted net asset value per Ordinary Share is based on the net assets attributable to the ordinary shareholders of £281,933,000 (30 September 2006: £263,207,000, 31 December 2006: £267,500,000) and on 232,981,022 (30 September 2006: 233,998,471, 31 December 2006: 233,998,471) Ordinary Shares in issue at the balance sheet date excluding treasury shares. 20. On 17 October 2007, the Group acquired the entire share capital of Urosonics Limited and Cystoscope Limited for a consideration of £1,451,000. The consideration was satisfied by the issue of 750,000 Ordinary Shares in the Company. 21. A copy of this statement has been sent out to every shareholder. Further copies are available from the Company's registered office or from the website www.assuragroup.co.uk. 22. The interim financial statements were approved at a meeting of the Board of Directors held on 27 November 2007. This information is provided by RNS The company news service from the London Stock Exchange

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