Final Results 31 Dec 2005
McInerney Holdings PLC
23 February 2006
Thursday, 23rd February 2006
McINERNEY HOLDINGS PLC PRELIMINARY ANNOUNCEMENT
Financial Results for the Year ended 31 December 2005
The McInerney Group achieved solid growth in the year to end December 2005.
Key highlights include:
• Pre tax profits increased by 26%
• Earnings per share increased by 16%
• Dividend increased by 33%
• UK unit output increased by 32%
Financial Highlights
The year under review has shown further solid progress. The Directors are
pleased to report an increase in basic earnings per share of 16% to 124.01 cent,
as compared to 106.50 cent in 2004. Pre-tax profits increased by 26% to €50.06m
compared to the 2004 result of €39.59m. Profit after tax for the year was
€41.10m compared with €35.03m for the full year in 2004, an increase of 17%.
Dividend
The Board proposes to pay a final dividend of 15 cent gross per share. Subject
to confirmation at the Annual General Meeting on 10th May 2006, this final
dividend will be paid to shareholders on 12th May 2006. Combined with the
interim dividend of 9 cent gross, this provides a total of 24 cent per share for
the year. The dividend cover is now circa 5 times relative to basic earnings
per share.
Operational Highlights
Favourable performances were reported across the Group's three core regions of
Ireland, the UK and Spain. The Group completed a total of 1,831 private homes in
2005. This compares to 1,614 in 2004 and is an increase of 13%. In particular,
the UK's operations recorded a 32% volume increase in a market that was
generally slow in 2005. This leaves us operationally well positioned for 2006.
In Ireland, the owner-occupier market continued to demonstrate strong product
demand. Volume in our commercial business was 15,339 sq m an increase of 85% on
the 8,289 sq m achieved in 2004.
The Directors are particularly pleased with the significant momentum that has
been achieved in the scale of the Group's operations in terms of geographic
spread and output since our ambitious expansion plans began a number of years
ago. From a start up in 1999, the Group has established a strong regional
presence across the North of England.
Ireland: The Irish house building operation delivered strong volumes. There
were 1,138 private home completions in 2005, compared to 1,101 in 2004. Market
indications, demographics and predicted inward migration all suggest that the
current buoyancy of the housing market is set to continue. The Group is
comfortable that the level of output from this business will be sustained going
forward. To support this level of output, the Group currently has 4,700 plots in
its Irish land bank, of which 50% have planning permission and the balance are
residentially zoned. In addition, the Group holds land with potential for circa
1,600 longer term plots.
The Group's commercial division, Hillview Securities, recorded an excellent year
in 2005 completing 14,217 sq m of industrial units in Ireland as compared to
4,666 sq m in 2004.
In addition, the Irish contracting business demonstrated strong uplift in 2005.
The order book on hand is €129 million compared to €23 million a year ago
providing an order book extending into 2007. Some 66% of this is housing
related.
UK: Significant progress was accomplished in the Group's UK growth plan in 2005.
Housing output increased by 32% with 658 private home completions in 2005,
compared with 500 in 2004.
In addition, strategic regional expansions were undertaken. The Yorkshire base,
established in 2005, will contribute to 2006 earnings with output planned of
some 90 units. A West Midlands Director was appointed at the start of 2006, as
part of the Group's strategy for further growth in 2007.
In tandem, progressive land bank enlargement has taken place with 2,350 plots
now controlled and a further 450 plots close to finalisation.
The Group now has a strong presence across the North of England and a growth
strategy is being put in place to develop a presence in the Midlands. The
acquisition of Augusta Developments, a niche player based in Milton Keynes,
opens up the opportunity for further expansion and product diversification. The
division is well placed to achieve further growth going forward.
The commercial operations also delivered a solid performance with the completion
of 1,122 sq m of industrial/business units in its UK operations compared to
3,623 sq m in 2004. Based on reservations on hand, output levels should rise
significantly in 2006.
Spain: The Spanish business delivered 35 units in 2005 compared to 13 units in
2004. A new site with planning consent at El Cortesin golf urbanisation near
Estepona, was recently secured. It has planning consent for up to 45 private
units. The Spanish business has a significant and valuable land bank to provide
strong growth potential in the medium term.
Outlook
The fundamentals and dynamics affecting both the Irish and UK housing markets
offer good potential for the Group. Each subsidiary is strategically positioned
geographically, with an appropriate product portfolio to provide continued
revenue growth going forward.
We expect our focused strategy to continue to deliver growth in 2006.
Ned Sullivan
Chairman
ENDS
FOR PRESS INFORMATION:
Siobhan Molloy Tel: (01) 676 01 68 or (086) 817 50 66
Weber Shandwick FCC
MC INERNEY HOLDINGS PLC
CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2005
Year ended Year ended
31/12/2005 31/12/2004
€'000 €'000
(Restated)
Continuing Operations
Revenue 489,098 373,359
Cost of Sales (394,478) (302,272)
Gross Profit 94,620 71,087
Administrative Expenses (33,458) (28,437)
Share of Results from Joint Ventures (21) 5,754
Profit from Operations 61,141 48,404
Investment Income 421 437
Finance Costs (11,502) (9,253)
Profit before Tax 50,060 39,588
Tax (8,963) (4,560)
Profit for the Year from Continuing Operations 41,097 35,028
Dividends (6,629) (4,273)
Retained Profit for the Year 34,468 30,755
Profit attributable to Equity Holders of the 41,097 35,028
Parent
Earnings Per Share
From Continuing Operations:
Basic 124.01 106.50
Diluted 118.66 101.55
MC INERNEY HOLDINGS PLC
CONSOLIDATED BALANCE SHEET
As at 31 December 2005
31/12/2005 31/12/2004
€'000 €'000
(Restated)
Non-Current Assets
Goodwill 22,390 21,744
Property, Plant & Equipment 6,188 6,241
Investment Property 183 5,509
Interests in Joint Ventures 4,660 6,854
Deferred Tax Assets 318 1,170
Assets Classified as held for Sale 2,750 -
36,489 41,518
Current Assets
Inventories 333,241 266,058
Trade & Other Receivables 52,044 44,118
Cash & Cash Equivalents 62,056 26,670
447,341 336,846
Total Assets 483,830 378,364
Current Liabilities
Trade & Other Payables 131,633 127,872
Retirement Benefit Obligation 422 421
Tax Liabilities 15,795 9,116
Obligations under Finance Leases 395 316
Bank Loans & Overdrafts 106,058 58,433
254,303 196,158
Net Current Assets 193,038 140,688
Non-Current Liabilities
Bank Loans 66,990 57,043
Retirement Benefit Obligation 1,358 1,676
Deferred Tax Liabilities 2,303 2,284
Other Payables 3,649 1,814
Obligations under Finance Leases 412 408
74,712 63,225
Total Liabilities 329,015 259,383
Net Assets 154,815 118,981
EQUITY
Share Capital 4,145 4,140
Capital Conversion Reserve Fund 62 62
Share Premium Account 17,180 17,113
Equity Reserve 674 298
Hedging & Translation Reserves (1,524) (2,269)
Retained Earnings 134,278 99,637
154,815 118,981
Total Equity and Liabilities 483,830 378,364
MC INERNEY HOLDINGS PLC
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 December 2005
Year ended Year ended
31/12/2005 31/12/2004
€'000 €'000
(Restated)
Profit from Operations 61,141 48,404
Adjustments for:
Depreciation of Property, Plant & Equipment 1,952 2,411
Share of Results from Joint Ventures 21 (5,754)
Provision for Fair Value of Share Based 376 298
Payments
Profit on disposal of Tangible Assets (48) (205)
Pension Service Costs 281 468
Operating Cash Flows before movements in 63,723 45,622
Working Capital
Increase in Inventories (63,267) (30,320)
Increase in Receivables (3,233) (9,843)
Increase in Payables 9,752 16,400
Cash Generated by Operations 6,975 21,859
Taxation Paid (7,625) (4,536)
Interest Paid (10,747) (7,643)
NET CASH FROM OPERATING ACTIVITIES (11,397) 9,680
INVESTING ACTIVITIES
Interest Received 134 325
Dividends Received from Joint Ventures 2,000 1,900
Loans advanced to Joint Ventures (9,270) (9,202)
Loans repaid from Joint Ventures 5,267 1,078
Proceeds on disposal of Property, Plant & 195 410
Equipment
Purchases of Property, Plant & Equipment (1,735) (1,773)
Employer Contributions to Pension Scheme (421) (438)
Acquisition of Subsidiary - (10,952)
NET CASH USED IN INVESTING ACTIVITIES (3,830) (18,652)
FINANCING ACTIVITIES
Dividends Paid (6,629) (4,273)
Share Capital Subscribed 72 504
Repayments of Borrowings (80,183) (26,884)
Repayments of Obligations under Finance Leases (460) (360)
New Bank Loans Raised 135,894 41,047
Increase / (Decrease) in Bank Overdrafts 258 (1,057)
NET CASH FROM FINANCING ACTIVITIES 48,952 8,977
NET INCREASE IN CASH AND CASH EQUIVALENTS 33,725 5
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 26,670 26,435
Effect of Foreign Exchange Rate Changes 1,661 230
CASH AND CASH EQUIVALENTS AT END OF YEAR
Bank Balances and Cash 62,056 26,670
MC INERNEY HOLDINGS PLC
NOTES TO THE FINANCIAL STATEMENTS (CONT'D)
For the year ended 31 December 2005
Business and geographical segments
The Group operates in three countries, Ireland, the UK and Spain. The principal
activities of the Group are Private Housing, Contracting, Commercial and
Leisure. The Leisure activities are divided into Club Management and Freehold
sales. Land sales are also a part of each business segment. These divisions
are the basis on which the Group reports its primary segment information.
REVENUE 31/12/2005 31/12/2004
External Total External Inter-Segment Total
Inter-Segment
Sales Sales Revenue Sales Sales Revenue
€'000 €'000 €'000 €'000 €'000 €'000
Ireland:
Private Housing 244,575 - 244,575 223,975 - 223,975
Developed Sites & Land 1,951 - 1,951 4,889 - 4,889
Construction Contracts 47,293 16,615 63,908 23,898 - 23,898
Commercial 21,134 - 21,134 5,694 - 5,694
Commercial Land 2,667 - 2,667 7,916 - 7,916
317,620 16,615 334,235 266,372 - 266,372
UK:
Private Housing 123,087 - 123,087 85,257 - 85,257
Developed Sites & Land 13,543 - 13,543 - - -
Construction Contracts 17,596 952 18,548 16,958 - 16,958
Commercial 2,026 - 2,026 7,350 - 7,350
156,252 952 157,204 109,565 - 109,565
Spain:
Club Management 3,461 - 3,461 3,618 - 3,618
Leisure Freehold 12,446 - 12,446 6,412 - 6,412
Developed Sites & Land 751 - 751 2,840 - 2,840
16,658 - 16,658 12,870 - 12,870
Eliminations (1,432) (17,567) (18,999) (15,448) - (15,448)
Total Revenue 489,098 - 489,098 373,359 - 373,359
Inter-segment sales are tendered for on an arm's length basis to ensure cost
efficiencies. The contract sum is agreed at cost plus a commercial margin.
SEGMENT RESULTS 31/12/2005 31/12/2004
Group Joint Total Group Joint Total
Subsidiaries Ventures Segment Subsidiaries Ventures Segment
€'000 €'000 €'000 €'000 €'000 €'000
Ireland:
Private Housing 37,686 (21) 37,665 25,785 3,701 29,486
Developed Sites & Land 749 - 749 921 - 921
Construction Contracts 1,564 - 1,564 3,406 - 3,406
Commercial 4,572 - 4,572 1,200 2,053 3,253
Commercial Land 275 - 275 1,081 - 1,081
44,846 (21) 44,825 32,393 5,754 38,147
UK:
Private Housing 12,447 - 12,447 12,176 - 12,176
Developed Sites & Land 4,135 - 4,135 - - -
Construction Contracts 361 - 361 125 - 125
Commercial 153 - 153 377 - 377
17,096 - 17,096 12,678 - 12,678
Spain:
Club Management 1,295 - 1,295 823 - 823
Leisure Freehold 3,500 - 3,500 267 - 267
Developed Sites & Land 260 - 260 1,218 - 1,218
5,055 - 5,055 2,308 - 2,308
Total Segment Results 66,997 (21) 66,976 47,379 5,754 53,133
A summary of the above results by activity is as follows:
Private Housing 50,133 (21) 50,112 37,961 3,701 41,662
Developed Sites & Land 5,419 - 5,419 3,220 - 3,220
Construction Contracts 1,925 - 1,925 3,531 - 3,531
Commercial 4,725 - 4,725 1,577 2,053 3,630
Club Management 1,295 - 1,295 823 - 823
Leisure Freehold 3,500 - 3,500 267 - 267
Total Segment Results 66,997 (21) 66,976 47,379 5,754 53,133
Common Costs (5,835) (4,729)
Profit from Operations 61,141 48,404
Investment Income 421 437
Finance Costs (11,502) (9,253)
Profit Before Tax 50,060 39,588
Tax (8,963) (4,560)
Profit After Tax 41,097 35,028
BALANCE SHEET 31/12/2005 31/12/2004
Assets Liabilities Nett Assets Liabilities Nett
Assets Assets
€'000 €'000 €'000 €'000 €'000 €'000
Ireland:
Private Housing 173,004 (89,689) 83,315 148,153 (79,222) 68,931
Commercial 9,397 (857) 8,540 18,038 (1,165) 16,873
182,401 (90,546) 91,855 166,191 (80,387) 85,804
UK:
Private Housing 161,287 (32,071) 129,216 110,279 (26,348) 83,931
Commercial 24,899 (523) 24,376 10,245 (744) 9,501
186,186 (32,594) 153,592 120,524 (27,092) 93,432
Spain:
Club Management 8,741 (4,022) 4,719 19,581 (4,453) 15,128
Leisure Freehold 43,045 (19,112) 23,933 43,675 (27,230) 16,445
51,786 (23,134) 28,652 63,256 (31,683) 31,573
Total Operating Assets / 420,373 (146,274) 274,099 349,971 (139,162) 210,809
(Liabilities)
Total Cash / (Bank Borrowings) 62,056 (173,048) (110,992) 26,670 (115,476) (88,806)
Unallocated Assets / 1,401 (9,693) (8,292) 1,723 (4,745) (3,022)
(Liabilities)
483,830 (329,015) 154,815 378,364 (259,383) 118,981
These preliminary results do not constitute statutory accounts. The Auditors
have reviewed the financial information set out on pages 3 to 8 for the year
ended 31 December 2005 as part of their year end audit process and have agreed
the information as presented. The 2005 financial results have been prepared in
accordance with the Group's accounting policies under International Financial
Reporting Standards (IFRS). The comparative figures for 2004 have been restated
to reflect the Group's adoption of IFRS.
This announcement has been issued through the Companies Announcement Service of
The Irish Stock Exchange
This information is provided by RNS
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