Interim Results
Panther Securities PLC
27 September 2002
Panther Securities PLC
Panther Securities PLC, the property investment company has today announced its
interim results for the six months to 30th June 2002.
CHAIRMAN'S STATEMENT
I am pleased to report the interim figures for the six months to 30 June 2002.
Pre-tax profits amount to £1,417,000 compared to £2,054,000 for the same period
for the previous year. The reduced figure is largely due to the fact that the
previous half year included a substantial extraordinary dividend from William
Nash plc whereas this half-year's profits are derived almost entirely from
rental income which continues to show an upward trend.
Rental income receivable during this half year was £3,508,000 compared to
£2,945,000 in the comparable period of last year.
Major Transactions
In March 2002 we acquired a long leasehold investment at 134/136 Above Bar
Street, Southampton at a cost of £860,000. This property is located in a prime
position and is let to the multiple hairdressers Toni & Guy and Moss Bros. The
property currently produces about £90,000 per annum net.
In May 2002, a modern parade of 11 shop units at 2-22 High Street, Bromley was
acquired on a 123 year lease at a fixed peppercorn rent. The purchase cost was
£2.7 million which includes the quite staggering amount of £100,000 for stamp
duty. The property is let to Sketchley, Oxfam, Mr Minit, Reed Employment and
William Hill among others and produces £290,000 per annum.
Shortly after 30 June 2002 balance sheet cut off date, we completed the purchase
of two further substantial investment properties, which are described below.
The first in 34/36 Darley Street, Bradford is a freehold shop/office investment
situated in a prime position and is fully let to Nationwide Building Society,
Country Casuals and a large firm of local solicitors. Our purchase costs were
£880,000 and it produces £82,000 per annum.
The second property, the Oakwood Estate, South Road, Harlow is a multi-let
industrial estate of mainly single storey factory units totalling about 67,000
sq ft of which about 90% of the space is let. It currently produces
approximately £270,000 per annum of which 45% is derived from Coates Brothers
Plc who have 15 years remaining on their lease. This freehold estate cost
approximately £2.5 million which again includes the substantial stamp duty cost
of approaching £100,000.
Shareholders will recall that in my last Annual Report I commented in detail on
the severe delays and problems we encountered with Brighton Planning Department
with regard to our parade of vacant properties in York Place, Brighton. After
the many difficulties, trials and tribulations we encountered, we eventually
decided to take the easy way out and put the property up for sale. In July 2002
they sold at auction to a local developer for £1,380,000.
We wish him luck and hope he has more success in dealing with the Local
Authority. These properties realised substantially in excess of the independent
valuation attributed to them at 31 December 2001 and this profit will be
reflected in the full year's results.
Panther House Redevelopment
The first stage of this development relating to Panther House, 38 Mount Pleasant
has commenced and the planning permission implemented. Our architects are
currently working on a design for the Grays Inn Road frontage and we shall
shortly seek an occupier/purchaser for both sections of the scheme.
Bristol Redevelopment
I have mentioned this superstore scheme in a number of my previous statements.
It is now currently being offered on the open market by our agents together with
the agents for Bristol City Council with whom we own jointly the bulk of the
site. We have had firm interest from at least two major supermarket operators
and negotiations are in hand and I am optimistic that we will reach a
satisfactory conclusion in the near future.
Eurocity Properties PLC
Shareholders will no doubt be aware that our 29% shareholding in this company,
which cost slightly in excess of £500,000, enabled us to take effective action
to block proposals for them to make an acquisition of two Hong Kong companies
owning large development properties in Central China. Your board felt that the
proposal would have been disastrous for Eurocity. We were also able to remove
their executive management and replace it with our own representatives by virtue
of an EGM requisitioned by Panther Securities on 2 May 2002. This enabled us to
greatly reduce Eurocity's excessive management costs.
As we now have management control, Eurocity accounts are consolidated with our
own, where the effect is minimal on the profit and loss account, but increases
the gross figures on our balance sheet and gearing, but has virtually no affect
on net assets.
Upon taking control of the management of Eurocity, Panther made a secured loan
of approximately £325,000 to enable Eurocity to protect net assets shown on
their balance sheet at approximately £1 million.
Finance
We have recently agreed additional loan facilities of £15,000,000 for investment
or trading property acquisitions and with our current cash balances of over
£7,000,000 makes us well placed to take advantage of any special opportunities
that become available.
Dividends
An interim dividend of 3.5p per share will be paid on 31 October 2002 and it is
your board's intention to recommend a final dividend of at least 3.5p per share
in due course.
Outlook
I have been predicting an economic downturn for quite some time and it seems
that the Stock Market now agrees with me in foretelling future problems. We have
yet to feel any repercussions in our particular sector of the property market
and we still have reasonable tenant demand and success in securing rent
increases on most reviews.
With our rising rent roll, conservative gearing, current low interest rates and
resources available to us, your Board remains confident that our Company is well
placed for continued success and, as always, I look forward to the future with
optimism.
Andrew S. Perloff
Chairman
27 September 2002
INTERIM CONSOLIDATED RESULTS
for the six months ended 30th June 2002
Six months to Six months to Year ended
30th June 30th June 31st December
2002 2001 2001
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Turnover 3,846 5,556 7,933
Exceptional turnover - - 1,495
Cost of sales (533) (1,877) (2,834)
________ ________ ________
Gross Profit 3,313 3,679 6,594
Administrative expenses (561) (516) (1,012)
________ ________ ________
Operating profit 2,752 3,163 5,582
Income from participating interests 18 (54) (18)
Profit on sale of investment property - 3 154
Interest receivable 192 131 325
Interest payable (1,545) (1,189) (2,512)
_______ _______ ________
Profit on ordinary activities before taxation 1,417 2,054 3,531
Taxation (457) (407) (810)
________ ________ ________
Profit on ordinary activities after taxation 960 1,647 2,721
Minority interests (16) (3) (5)
________ ________ ________
Profit attributable to members of the parent undertaking 944 1,644 2,716
Dividends (592) (593) (1,525)
________ ________ ________
Retained profit for the period 352 1,051 1,191
Realisation of property revaluation gains - 167 17
Retained profit brought forward 10,491 9,283 9,283
________ ________ ________
Retained profit carried forward 10,843 10,501 10,491
________ ________ ________
Earnings per share 5.6p 9.7p 16.0p
CONSOLIDATED BALANCE SHEET
for the six months ended 30th June 2002
30th June 30th June 31st December
2002 2001 2001
(Unaudited) (Unaudited) (Audited)
£000 £000 £000
Fixed assets
Tangible assets 76,501 55,758 61,951
Negative goodwill (204) - -
Investments 299 244 281
________ ________ ________
76,596 56,002 62,232
________ ________ ________
Current assets
Stock 5,208 5,974 5,081
Current asset investments 239 - 626
Debtors 1,841 959 753
Cash at bank and in hand 10,255 6,057 9,189
________ ________ ________
17,543 12,990 15,649
Current liabilities
Creditors:
amounts falling due within one year (5,355) (3,357) (3,466)
________ ________ ________
Net current assets 12,188 9,633 12,183
________ ________ ________
Total assets less current liabilities 88,784 65,635 74,415
Creditors:
amounts falling due after more than one year (49,610) (32,200) (37,137)
Minority interests (1,636) (100) (92)
________ ________ ________
Net assets 37,538 33,335 37,186
________ ________ ________
Capital and reserves
Share capital 4,237 4,237 4,237
Revaluation reserve 17,913 14,055 17,913
Profit and loss account 10,843 10,501 10,491
Share premium account 2,862 2,862 2,862
Negative goodwill reserve 1,123 1,120 1,123
Capital redemption reserve 560 560 560
________ ________ ________
Shareholders' funds 37,538 33,335 37,186
________ ________ ________
Net assets per share 221.5p 196.7p 219.4p
GROUP CASH FLOW STATEMENT
for the six months ended 30 June 2002
Six months to Six months to 12 months to
30th June 30th June 31st December
2002 2001 2001
Unaudited Unaudited Audited
£000 £000 £000
Cash inflow from operating activities 2,144 3,044 5,909
Returns on investments and servicing of finance
Interest received 192 131 325
Interest paid (1,545) (1,189) (2,511)
Net cash outflow from returns
on investments and servicing of finance (1,353) (1,058) (2,186)
Taxation
Corporate tax paid (7) (1) (599)
Capital expenditure and financial investment
Purchase of investments - - (6)
Sale of other tangible fixed assets - 248 2,032
Purchase of other tangible fixed assets (3,828) (2,687) (6,817)
Net cash outflow from capital expenditure and
financial investment (3,828) (2,439) (4,791)
Acquisitions and disposals
Purchase of subsidiary undertaking (139) - -
Cash at bank acquired with subsidiary 310 - -
Net cash inflow /(outflow) from 171 - -
acquisitions and disposals
Equity dividends paid (932) (594) (1,186)
________ ________ ________
Cash outflow before use of liquid resources and (3,805) (1,048) (2,853)
financing
Financing
(Decrease)/increase in debt 4,869 2,092 7,029
4,869 2,092 7,029
________ ________ ________
Increase/(decrease) in cash 1,064 1,044 4,176
________ ________ ________
Notes to the Cash Flow Statement
1. Reconciliation of net cash flow to movement in net
debt
Six months Six months 12 months
to 30th to 30th to 31st
June 2002 June 2001 June 2001
Unaudited Unaudited Audited
£000 £000 £000
Increase/(decrease) in cash in the period 1,064 1,044 4,176
Loans acquired on acquisition (8,095) - -
Cash (outflow)/inflow from increase in debt (4,869) (2,092) (7,029)
________ ________ ________
Change in net debt arising from cash flows (11,900) (1,048) (2,853)
Net debt at start of period (28,098) (25,245) (25,245)
________ ________ ________
Net debt at period end (39,998) (26,293) (28,098)
________ ________ ________
2. Analysis of net debt
At 1st January 2002 Cash flow Acquisition At 30th June 2002
(excluding cash)
£000 £000 £000 £000
Cash at bank and in hand 9,189 1,064 - 10,253
Debt due within one year (150) 150 - -
Debt due after one year (37,137) (5,019) (8,095) (50,251)
________ ________ ________ ________
(28,098) (3,805) (8,095) (39,998)
________ ________ ________ ________
3. Purchase of subsidiary undertakings
Net assets acquired £000
Tangible fixed assets 10,732
Debtors 184
Creditors (874)
Loans (8,095)
Cash at bank in hand 310
Minority shareholders interest (1,528)
______
729
Negative goodwill (204)
_______
525
_______
Satisfied by
Cash current period 139
Cash prior period 386
_______
Actually paid 525
Notes:
1. Results
The six months results have been prepared on the historical cost basis, modified
to include the revaluation of fixed asset land and buildings, although no
further revaluation has been undertaken on any part of the property portfolio
since results were last reported. They are unaudited and do not constitute
statutory accounts within the meaning of section 240 of the
Companies Act 1985.
2. Accounts
The figures for the year to 31st December 2001 have been extracted from the
statutory accounts which have been reported on by the Group's auditors and have
been delivered to the Registrar of Companies. The auditor's report was
unqualified and did not contain any statement under section 237(2), (3) or (4)
of the Companies Act 1985.
3. Dividends
An interim dividend of 3.5p per ordinary share will be paid on 31st October 2002
to shareholders on the Register on 11th October 2002.
4. Earnings per share
Earnings per ordinary share have been calculated on profit attributable to
members of the holding company and on 16,947,117 (June 2001 - 16,947,117)
ordinary shares being the weighted average number of ordinary shares in issue
throughout the six months ended 30th June 2002.
5. Copies of this report are to be sent to all shareholders and are available
from the Company's registered office at Panther House, 38 Mount Pleasant, London
WC1X 0AP.
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