Interim Results - 6 Months to 30 September 1999

Helical Bar PLC 25 November 1999 H E L I C A L B A R P L C I n t e r i m R e s u l t s For the half year to 30 September 1999 HELICAL HAMMERS ON Interim profits before tax 11 per cent higher at £9.1 million (1998: £8.2 million) Diluted earnings per share increased by 26 per cent to 24.7p (1998: 19.6p) Interim dividend 4.4p - up 10 per cent Net rental income up 27 per cent New developments totalling over 1 million sq. ft. John Southwell, Chairman states: 'Having paid a Special Dividend of £29 million, in April and October, there is a continuing flow of cash from the surplus of rent over interest and from completed profitable developments. This will enable the company to respond quickly to opportunities to expand the group's investment and development activities.' Further information, please contact: Helical Bar plc Michael Slade (Managing Director) 0171 629 0113 Nigel McNair Scott (Finance Director) Financial Dynamics Emma Denne 0171 831 3113 C h a i r m a n ' s S t a t e m e n t Results Helical's turnover for the period was £68.3m (1998: £60.2m). Developments contributed £53.5m (1998: £46.9m). Trading and other income was £1.9m (1998: £3.0m) and rental income was £12.9m (1998: £10.3m). Development profits were £8.7m (1998: £8.5m) and net rental income was 27 per cent higher at £11.4m (1998: £9.0m). Profits on sales of investment property were £1.2m (1998: nil). After accounting for interest and administration costs, profits before taxation rose by 11 per cent to £9.1m (1998: £8.2m). Minority interests were £0.3m (1998: £0.6m). Fully diluted earnings per share rose to 24.7p (1998: 19.6p). Net assets per share increased by 19p to 492p. This figure is based on investment property values at 31 March 1999. It excludes valuation surpluses on trading and development stock and potential profits on pre-sold developments. The directors are pleased to announce an increase in the interim dividend of 10 per cent to 4.4p (1998: 4.0p). Development Programme During the period, we achieved major lettings at a number of our office schemes. Our two buildings at Windsor, forward funded with clients of Argyll Asset Management, are now completed. These were let at record rent levels; 44,000 sq. ft. to FM Insurance Co. Ltd. at £30 p.s.f. and 24,000 sq. ft. to the Galileo Company at £29 p.s.f. Our 35,000 sq. ft. scheme adjacent to Guildford railway station forward funded with the British Gas Staff Pension Fund has been completed and let to MWB Business Exchange at £27 p.s.f. Of the properties held on our own book, the completed 45,000 sq. ft. scheme at 6 St Andrews Street, London EC4, 35,000 sq. ft. pre-let to solicitors Speechly Bircham has been handed over to the purchaser Shell Pension Fund this month and our site at Welsh Back, Bristol has been sold to Fuller Smith Turner plc for bar/restaurant and hotel use. We have also sold our recently completed 35,200 sq. ft. development at 10 Mansion House Place, London EC4 to British Arab Commercial Bank. Building work continues on our sites in the City, the 260,000 sq. ft. development at 25-32 Chiswell Street, pre-let to Slaughter and May, due for completion in Autumn 2000 and the 152,000 sq. ft. development at 100 Wood Street which will be ready for letting in Spring 2000. Both these schemes have been forward funded and pre-sold to Despa. Since the end of September we have forward funded our 60,000 sq. ft. development at One Plough Place, London EC4 with Henderson Investors on behalf of NPI. We let the last 5,000 sq. ft. of our 30,000 sq. ft. development Blenheim House, 1 West Street, Leeds and have sold the building at slightly over book value. We have also profitably disposed of our interest in a retirement homes project at Berkhamsted to Ward Holdings plc. In spite of little growth in tenant demand and rising building costs, there has been increasing demand for speculative sites in the City and the South East, making it difficult to find value. Nevertheless, looking forward, we still have a portfolio of interesting schemes over the next two years including the 76,000 sq. ft. office development at 200 Hammersmith Road, London W6, the 180,000 sq. ft. office scheme at the Meadows, Camberley forward funded with Scottish Widows, the 100,000 sq. ft. development in Bunhill Row adjoining the Chiswell Street development and the 70,000 sq. ft. office refurbishment scheme at Rex House, 4-12 Regent Street, London SW1. Helical Retail, our 75% retail development subsidiary, completed the fully let 80,000 sq. ft. development at the George Hotel, Glasgow for Hermes, the 44,000 sq. ft. development for Merseyside Pension Fund at Ilford and the 250,000 sq. ft. town centre development at Captain Cook Square, Middlesbrough for Norwich Union where they also plan a further extension. In Bolton they are finishing a new unit as an extension to the existing retail park and have exchanged a conditional agreement for lease with B&Q for a 121,000 sq. ft. retail warehouse on an adjoining site. During the last nine months Jim Kelly and his team have concentrated on new schemes in and around town centres and are putting together projects on over a million sq. ft. of new space in Ipswich, Newcastle, Cheltenham, Dorchester, Truro, Wigan, Chichester, Canterbury and Solihull. This programme and the office development schemes under way should enable Helical to reinforce its position as a specialist developer, offering institutional investors attractive investments providing high quality space for office and retail occupiers. Investment Portfolio In Spring of this year we decided to step up our purchasing activity and bought £80m of property including a flagship office and retail investment at 60 Sloane Avenue, Brompton Cross, London, media style offices let to World Television News at the Interchange, Camden, London and the Scottish Enterprise industrial portfolio. Since then investment sentiment has rebounded making it harder to source reasonably priced stock, but this offered us the chance to continue repositioning our portfolio with sales of over-rented offices at Wellington House, Strand, London and of Cannon Park, Coventry, this the last of our shopping centres purchased in the early 1990s. We also sold, at a profit, The Pavilion, Thames Ditton, which was acquired last year. On asset management, voids continued to fall with the last office space at Cheapside House being let. Significant rent increases were obtained in many of the buildings acquired over the last two years in and around central London, particularly in Southwark and at Capital House, London, NW1. Since the half year end we have exchanged contracts to buy a £25.0m mixed portfolio of office, retail and industrial units with a number of further purchases and sales in solicitors' hands. Prospects We continue to benefit from last year's reductions in interest rates and the continuing cash flow from the development programme, including since the half year, receipts in respect of Middlesbrough and Windsor and from the sales of Blenheim House, Leeds and Welshback, Bristol. Further inflows of profits from 6 St Andrews Street, London EC4, Guildford, Mansion House Place and Chiswell Street are expected over the next 15 months. Continuing our policy of being comparatively highly geared, we are increasing our major loan facility to £175m and extending it until the end of 2009. The majority of our borrowings are capped at rates between 5.22 per cent and 7.50 per cent. The fair values of financial assets and liabilities under Financial Reporting Standard No. 13 compared to their book values show a net asset position of approximately £3.5m (31 March 1999 liability of £4.8m). Our aim is to use this strong base over the next three years to widen the gap between rents and interest payable while taking advantage of new opportunities. Year 2000 Compliance Helical, as previously reported in the Company's Annual Report and Accounts, has conducted a review of its computer systems and implemented an action plan to ensure that its exposure to risks of disruption to its business from Year 2000 issues is minimised. That action plan has now been completed although the monitoring of compliance of our systems will continue. While no organisation can guarantee that no Year 2000 problems will arise, the Board believes it has reached an appropriate state of readiness and has allocated resources to deal promptly with any issues that may arise. Summary Having paid a Special Dividend of £29 million, in April and October, there is a continuing flow of cash from the surplus of rent over interest and from completed profitable developments. This will enable the company to respond quickly to opportunities to expand the group's investment and development activities. John Southwell CHAIRMAN Independent Review Report to Helical Bar plc Introduction We have been instructed by the company to review the financial information set out on pages 5 to 8 and we have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The Listing Rules of the London Stock Exchange 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. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4 'Review of Interim Financial Information' issued by the Auditing Practices Board. A review consists principally of making enquiries of management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 30 September 1999. Grant Thornton Chartered Accountants 25 November 1999 Group Profit and Loss Account For the half year to 30 September 1999 Unaudited Unaudited Audited Half Year To Half Year To Year To 30 September 30 September 31 March 1999 1998 1999 Notes £000 £000 £000 Turnover 1 68,291 60,173 121,244 Cost of sales (48,907) (43,152) (82,240) Gross profit 1 19,384 17,021 39,004 Administrative expenses (3,295) (2,633) (6,860) Operating profit 16,089 14,388 32,144 Profit/(loss) on sale of investment properties 1,166 (2) 415 Profit on ordinary activities before interest 17,255 14,386 32,559 Interest receivable 569 692 1,510 Interest payable and similar charges (8,707) (6,836) (14,025) Profit on ordinary activities before taxation 9,117 8,242 20,044 Taxation (1,520) (1,915) (3,899) Profit on ordinary activities after taxation 7,597 6,327 16,145 Minority interest (306) (609) (1,175) Profit for the period 7,291 5,718 14,970 Ordinary dividends - 4.40p (4.00p) (1,272) (694) (2,434) Special dividend - - (28,904) Preference dividends - paid - (1,153) (2,293) - accrued 3 - (216) - Retained profit/(loss) for the period 6,019 3,655 (18,661) Earnings per 5p share 2 - basic 25.2p 25.2p 66.7p - fully diluted 24.7p 19.6p 50.7p Summary Group Balance Sheet At 30 September 1999 Unaudited Audited At At 30 September 31 March 1999 1999 £000 £000 Fixed assets 402,407 338,307 Fixed assets for resale 525 525 Stock 34,037 35,054 Investments 885 - Debtors 40,232 40,148 Cash 31,569 44,310 Creditors falling due within one year (125,996) (128,662) Creditors falling due after one year (235,248) (187,576) Net Assets 148,411 142,106 Capital & Reserves Called up share capital 1,481 1,495 Share premium account 34,502 34,508 Revaluation reserve 81,714 78,948 Capital redemption and other reserves 7,392 7,372 Profit and loss account 22,433 19,201 Shareholders' funds 147,522 141,524 Minority interests 889 582 148,411 142,106 Shareholders' Funds Attributable to equity interests 147,522 141,510 Attributable to non-equity interests - 14 147,522 141,524 Net assets per share basic 498p 478p fully diluted 492p 473p Summary Cash Flow Statement For the half year to 30 September 1999 Unaudited Unaudited Audited Half Year To Half Year To Year to 30 September 30 September 31 March 1999 1998 1999 Notes £000 £000 £000 Net cash inflow/(outflow) from operating activities 4 22,597 (1,843) 27,969 Returns on investment and servicing of finance (8,763) (8,712) (18,161) Taxation (429) (743) (3,650) Capital expenditure and financial investment (11,984) (14,713) (60,398) Acquisitions (12,390) - - Equity dividends paid (16,186) (953) (1,648) Management of liquid resources 17,654 - 10,110 Financing - (redemption)/issue of shares (20) 1,460 1,352 - increase/(decrease) in debt 14,503 (21,027) 33,324 Increase/(decrease) in cash 4,982 (46,531) (11,102) Reconciliation of net cash flow to movement in net debt Increase/(decrease) in cash in the period 4,982 (46,531) (11,102) Cash inflow from management of liquid resources (17,654) - (10,110) Cash flow from decrease in net debt (14,503) 21,027 (33,324) Liability acquired with subsidiary (40,382) - - Debt arrangement expenses (194) (149) (256) Movement in net debt in the period (67,751) (25,653) (54,792) Net debt at beginning of the period (174,489) (119,697) (119,697) Net debt at end of the period (242,240) (145,350) (174,489) Gearing 163% 99% 122% Statement of Total Recognised Gains and Losses For the half year to 30 September 1999 Unaudited Unaudited Audited Half Year To Half Year To Year To 30 September 30 September 31 March 1999 1998 1999 £000 £000 £000 Profit for the period after taxation 7,597 6,327 16,145 Minority interest (306) (609) (1,175) Surplus on revaluation of investment properties - - 19,850 Total recognised gains and losses relating to the period 7,291 5,718 34,820 Notes to the Interim Statement 1. Turnover and gross profit on ordinary activities before taxation Unaudited Unaudited Audited Half Year To Half Year To Year To 30 September 30 September 31 March 1999 1998 1999 Turnover £000 £000 £000 Trading property sales 1,805 95 95 Rental income 12,917 10,336 21,482 Developments 53,541 46,873 96,622 Other income 28 2,869 3,045 68,291 60,173 121,244 Gross Profit Trading property sales (92) 57 72 Net rental income 11,421 9,006 18,475 Developments 8,698 8,533 21,601 Other net income (643) (575) (1,144) Gross profit 19,384 17,021 39,004 Central overheads (3,295) (2,633) (6,860) Interest payable less receivable (8,138) (6,144) (12,515) Profit before taxation and profit on sale of investment properties 7,951 8,244 19,629 2. Earnings per share Basic earnings per share have been calculated on the basis of profits after tax on 28,903,697 (1998 17,311,369) ordinary shares. Fully diluted earnings per share have been restated to comply with Financial Reporting Standard No. 14 and are calculated on 29,490,150 (1998 29,183,756) ordinary shares which include the conversion of preference shares and the exercise of share options. 3. Preference dividends The preference dividend accrued in accordance with Financial Reporting Standard No. 4 on Capital Instruments in the half year to 30 September 1998 is not payable because of the conversion of preference shares into ordinary shares on 16 February 1999. 4. Reconciliation of operating profit to net cash flow from operating activities Unaudited Unaudited Audited Half Year To Half Year To Year To 30 September 30 September 31 March 1999 1998 1999 £000 £000 £000 Operating profit 16,089 14,388 32,144 Depreciation of fixed assets 112 53 221 Write down of fixed assets held for resale - 250 500 Profit on sale of fixed assets (4) - 10 Amortisation of goodwill 35 - 41 Decrease in debtors 1,165 7,991 599 Increase/(decrease) in creditors 3,691 (24,806) 2,708 Decrease/(increase) in stocks 1,509 281 (8,254) Net cash inflow/(outflow) from operating activities 22,597 (1,843) 27,969 5. Notes to the Profit and Loss Account The interim statement was approved by the Board of Directors on 24 November 1999. The foregoing financial information does not represent full accounts within the meaning of S.240 of the Companies Act 1985, and has been reviewed but not audited by the auditors, nor filed with the Registrar of Companies. The results for the 12 months to 31 March 1999 are an abridged version of the full accounts which received an unqualified auditor's report and have been filed with the Registrar of Companies. The interim dividend is payable on 6 January 2000 to shareholders on the register on 10 December 1999. This statement is being sent to shareholders and will be available from the Company's Registered Office at 11-15 Farm Street, London W1X 8NP. 6. Notes to the Balance Sheet Realisations of £2.8m of property revaluation losses of prior periods have been transferred from the profit and loss reserve. Investment properties within fixed assets are carried at cost or valuation at 31 March 1999.

Companies

Helical (HLCL)
UK 100
FTSE quotes by TradingView

Latest directors dealings

All directors dealings today