Final Results

Safeland PLC 18 June 2007 SAFELAND PLC PRELIMINARY RESULTS Safeland plc, the property fund management and property trading group, announces results for the year ended 31 March 2007. Financial Highlights: • Revenue of £18.27m (2006: £15.59m) • Profits before tax of £3.69m (2006: £1.15m loss) - inc. £3.57m from Bizspace disposal • EPS of 15.18p (2006: 4.77p loss) • NAV per share of 114p (2006: 111p) • Gearing now stands at 117% Operational Highlights: • 51 transactions completed during the period (2006: 47) with an average lot size of £358,000 (2006: £332,000) • Formation of Safeland Property Unit Trust with Safeland as a UK property manager • £38m invested in multi-let properties to date • Proposal to raise a further £50m of equity for the fund Raymond Lipman, Chairman of Safeland plc, said: 'The board have decided to focus their future attention on the fund management business which has started so successfully. It is this that allows me to look forward to the future with confidence.' Safeland plc Tel: 020 8815 1600 Larry Lipman, Managing Director Paul Davis, Finance Director www.safeland.co.uk Parkgreen Communications Ltd Tel: 020 7479 7933 Paul McManus Mob: 07980 541 893 paul.mcmanus@parkgreenmedia.com SAFELAND PLC 18 June 2007 Chairman's Statement I am delighted to report a profit for the year to March 31 2007 of £3,691,000 compared to a loss for the previous year of £1,151,000. The resultant earnings per share were 15.18p (2006: loss 4.77p). In my last year's statement I advised shareholders of two post balance sheet events being the group's disposal of its shareholding in both Bizspace Plc and Serviced Office Group Plc. This financial year's accounts includes a profit of £3,572,000 in respect thereof. Espazio, the company's Italian self storage business, saw its trading losses continue to fall from £472,000 12 months ago to £404,000. During the year Espazio sold a freehold property in Milan for a profit of £910,000 and now only operates from two centres, one in Rome and one in Milan. As is demonstrated from the figures property trading has once again proved difficult and has resulted in an operating loss for the year of £58,000 despite a relatively good first six months. During the year under review the group undertook 51 transactions compared to 47 in the previous year with an average lot size of £358,000 (2006: £332,000). Revenue for the current period was £18,266,000 compared to £15,588,000 in the year ended March 31 2006. Gearing at the year end was 117% (2006: 69%). Net assets per share at the year end were 114p as against 111p at the start of the year. The major event to take place during this financial year was the announcement that was made on October 20 2006 of the formation of a Property Fund with Electra Partners Europe Limited in which Safeland has invested £1m and Electra £15m and which with bank funding will enable purchases of up to £50m to be made. I am pleased to advise shareholders that to date £38m has been invested primarily in multi-let properties throughout the UK and I am also delighted that we have been able to assemble the same team that were primarily responsible for the success of Bizspace and in particular Neil Corderey who will be responsible for the day to day running of the management vehicle. At the beginning of the year it was recognised that it would not take too long for the initial fund to be fully invested, and, therefore, CBRE were instructed in January 2007 to raise a further £50m of equity which will enable further purchases of c £150m to be made. Over the past few months presentations have been made to potential investors and I hope to be able to make an announcement as to the outcome of this in the next few weeks. With there being no sign on the horizon that conditions for property trading are likely to improve the board have decided to focus their future attention on the fund management business which has started so successfully. It is this that allows me to look forward to the future with confidence. Raymond Lipman Chairman 18 June 2007 CONSOLIDATED INCOME STATEMENT Year ended 31 March 2007 Note 2007 2006 £'000 £'000 Unaudited Audited Revenue 18,266 15,588 Cost of sales (14,394) (13,526) Gross profit 3,872 2,062 Sales and distribution costs (370) (394) Administrative expenses (4,786) (3,770) Other operating income 445 125 Profit on disposal of property, plant and equipment 939 7 Gains on revaluation of investment properties - 391 Profit on disposal of investment properties 156 103 Profit on disposal of subsidiaries 4 192 852 Operating profit / (loss) 448 (624) Share of results of associates - post tax (4) (17) Profit on disposal of available-for-sale investments 3 3,572 - Profit / (loss) before interest 4,016 (641) Finance income 140 285 Finance costs (465) (795) Profit / (loss) before tax 3,691 (1,151) Tax (882) 269 Profit / (loss) for the financial year 2,809 (882) Basic and diluted earnings / (loss) per share 5 15.18p (4.77p) CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE Year ended 31 March 2007 Note 2007 2006 £'000 £'000 Unaudited Audited Fair value gains on available-for-sale 18 2,370 investments Exchange differences on translation of foreign 43 (23) operations Tax on items taken directly to equity (5) (706) Net income recognised directly in equity 56 1,641 Transfer to profit on sale of available-for-sale (3,053) - investments Tax on items transferred from equity 751 - Profit / (loss) for the year 2,809 (882) Total recognised income and expense for the year 8 563 759 available to equity shareholders CONSOLIDATED BALANCE SHEET 31 March 2007 Note 2007 2006 £'000 £'000 Unaudited Audited Non-current assets Property, plant and equipment 4,263 6,095 Investment properties 1,868 4,632 Interests in associates 10 14 Available-for-sale investments 1,191 6,544 Deferred tax assets 46 290 Total non-current assets 7,378 17,575 Current assets Trading properties 38,753 16,387 Trade and other receivables 2,363 1,408 Cash and cash equivalents 7 1,448 1,903 Total current assets 42,564 19,698 Total assets 49,942 37,273 Current liabilities Bank loans and overdrafts 8,089 11,932 Trade and other payables 2,051 1,043 Current tax liabilities 541 226 Total current liabilities 10,681 13,201 Non-current liabilities Bank loans 18,040 2,247 Deferred tax liabilities 103 1,254 Derivative financial instruments - 16 Total non-current liabilities 18,143 3,517 Total liabilities 28,824 16,718 Net assets 21,118 20,555 Equity Share capital 925 925 Share premium account 5,351 5,351 Capital redemption reserve 765 765 Translation reserve (7) (50) Revaluation reserve 85 2,374 Retained earnings 13,999 11,190 Total equity 8 21,118 20,555 CONSOLIDATED CASH FLOW STATEMENT Year Ended 31 March 2007 Note 2007 2006 £'000 £'000 Unaudited Audited Operating activities Net cash outflow from operations 6 (26,100) (10,187) Interest paid (481) (830) Tax paid (728) (205) Net cash outflow from operating activities (27,309) (11,222) Investing activities Interest received 140 249 Purchase of investment properties (776) (412) Purchase of property, plant and equipment (518) (675) Purchase of available-for-sale investments (1,000) (65) Proceeds from sale of property, plant and equipment 2,947 184 Proceeds from sale of investment properties 3,696 349 Proceeds from sale of available for sale investments 6,890 - Dividends received from available-for-sale investments - 36 Disposal of subsidiaries 3,525 7,415 Net cash inflow from investing activities 14,904 7,081 Financing activities New loans 21,513 21,251 Loan repayments (9,306) (17,993) Net cash inflow from financing activities 12,207 3,258 Net decrease in cash and cash equivalents in the year (198) (883) Cash and cash equivalents at beginning of year 1,547 2,430 Cash and cash equivalents at end of year 7 1,349 1,547 NOTES TO THE PRELIMINARY ANNOUNCEMENT Year ended 31 March 2007 1. BASIS OF PREPARATION The financial information set out in the announcement does not constitute the group's statutory financial statements within the meaning of section 240 of the Companies Act 1985, for the years ended 31 March 2007 or 2006. The statutory financial statements for the year ended 31 March 2007 will be finalised and signed on the basis of the financial information presented by the directors in this preliminary announcement and will be delivered to the Registrar of Companies following the company's Annual General Meeting. The financial information for the year ended 31 March 2006 is derived from the statutory accounts for that year. The auditors reported on those statutory accounts which have been delivered to the Registrar of Companies; their report was unqualified and did not contain a statement under s237(2) or (3) of the Companies Act 1985. This announcement is prepared applying International Financial Reporting Standards as adopted by the European Union and using accounting policies that are consistent with those as stated in the previous year's financial statements. This preliminary announcement was approved by the Board of directors on 15 June 2007. Copies of this announcement are available from the company's registered office at 94-96 Great North Road, London, N2 0NL. The Annual Report and Accounts will be sent to shareholders shortly. 2. BUSINESS AND GEOGRAPHICAL SEGMENTS Business segments For management purposes, the group is currently organised into two operating divisions as detailed below: • property trading, property refurbishment and property investment; and • self-storage These divisions are the basis on which the group reports its primary segmental information. Geographical segments The group's operations are wholly based in the United Kingdom except the self-storage operation which operates in Italy. No additional segmental disclosure is provided in respect of geographical segments as they are identical to the business segments detailed above. Property trading, refurbishment and Self-storage Total investment 2007 2006 2007 2006 2007 2006 £'000 £'000 £'000 £'000 £'000 £'000 Unaudited Audited Unaudited Audited Unaudited Audited Revenue 17,828 15,255 438 333 18,266 15,588 Segment result (58) (152) 506 (472) 448 (624) Share of result of associates - post tax (4) (17) Profit on disposal of available-for-sale investments 3,572 - Finance income 140 285 Finance costs (465) (795) Profit / (loss) before tax 3,691 (1,151) Tax (882) 269 Profit / (loss) for the financial year 2,809 (882) Balance sheet Segment assets 46,334 26,288 2,361 4,137 48,695 30,425 Interests in associates 10 14 Available-for-sale investments 1,191 6,544 Deferred tax asset 46 290 Total assets 49,942 37,273 Segment liabilities 27,084 13,736 1,096 1,502 28,180 15,238 Current tax liabilities 541 226 Deferred tax liabilities 103 1,254 Total liabilities 28,824 16,718 3. PROFIT ON DISPOSAL OF AVAILABLE-FOR-SALE INVESTMENTS During the year, the group sold its entire shareholdings in Bizspace plc and Serviced Office Group plc for cash consideration totalling £6,890,000, which realised a profit on disposal in the income statement of £3,572,000. 4. PROFIT ON DISPOSAL OF SUBSIDIARIES One wholly-owned subsidiary of Safeland plc was sold during the year, CFC 24 Limited. The undertaking sold did not contribute any pre-tax results to the group in the year (2006: £nil). The following table sets out the book value of assets and liabilities disposed. CFC 24 Ltd £'000 Investment properties - Trading properties 3,333 Net assets 3,333 Profit on disposal 192 Total Consideration 3,525 Satisfied by Cash 3,525 5. EARNINGS / (LOSS) PER SHARE Basic and diluted earnings of 15.18p (2006: loss per share 4.77p) are based on the profit for the financial year of £2,809,000 (2006: loss of £882,000) and on 18,500,530 ordinary shares (2006: 18,500,530 ordinary shares) being the weighted average number of shares in issue throughout the year. The calculation of diluted earnings / (loss) per share uses the same earnings figure and weighted average number of shares as the basic calculation, as there are no dilutive options or instruments. 6. NOTES TO THE CASH FLOW STATEMENT 2007 2006 £'000 £'000 Unaudited Audited Operating profit / (loss) 448 (624) Adjustments for: Depreciation of property, plant and equipment 342 343 Profit on sale of property, plant and equipment (939) (7) Profit on sale of investment properties (156) (103) Gains on revaluation of investment properties - (391) Profit on sale of subsidiaries (192) (852) Operating cash flow before movements in working capital (497) (1,634) Increase in trading properties (25,699) (11,177) (Increase) / decrease in trade and other receivables (955) 3,890 Increase / (decrease) in trade and other payables 1,051 (1,266) Net cash outflow from operations (26,100) (10,187) 7. CASH AND CASH EQUIVALENTS 2007 2006 £'000 £'000 Unaudited Audited Cash and cash equivalents per balance sheet 1,448 1,903 Bank overdrafts (99) (356) Cash and cash equivalents per cash flow statement 1,349 1,547 8. RECONCILIATION OF CHANGES IN EQUITY 2007 2006 £'000 £'000 Unaudited Audited 1 April 2006 20,555 19,796 Total recognised income and expense for the year 563 759 31 March 2007 21,118 20,555 This information is provided by RNS The company news service from the London Stock Exchange

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