Final Results

Solitaire Group PLC 23 April 2002 23 April 2002 SOLITAIRE GROUP Plc Solitaire is a leading national provider of property management services PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2001 'Another year of solid progress for Solitaire' For further information: Graham Shapiro, Joint Managing Director Tel: 020 8364 8497 Solitaire Group Plc David Millham / Tarquin Edwards Tel: 020 7929 5599 Holborn Results Highlights Change Year ended Year ended 31 Dec 2001 31 Dec 2000 Turnover +22.4% £5,062,000 £4,136,000 Profit before tax, amortisation, +12.2% £1,651,000 £1,472,000 exceptional costs & interest Profit before tax -4.4% £1,159,000 £1,212,000 Earnings per share before amortisation +21.7% 25.8p 21.2p and exceptional costs Earnings per share 0% 17.6p 17.6p Final dividend +8.0% 6.75p 6.25p Total dividend +8.0% 9.5p 8.80p • Properties under management have increased by over 16% • New instructions for management continue at record levels with further growth forecast this year • PIPS expected to make a positive contribution to group earnings this year and the value of property under management is anticipated to grow further • Moss Kaye acquisition moves Solitaire into the field of commercial property and facilitates the cross-selling of professional services and expertise across the group • The proposed Commonhold & Leasehold Reform legislation should provide opportunities for new property management contracts George Brutton, Chairman of Solitaire Group Plc, commented: 'The continuing growth and medium to long term nature of Solitaire's core business of residential management confirms Solitaire's position as one of the UK market leaders in its sector. House builders continue to have faith in the UK economy and are increasing the pace of their developments. Solitaire will energetically look to benefit from this and from other opportunities as they arise in forthcoming years.' Chairman's Statement I am pleased to report another year of solid progress for Solitaire. It is significant that in excess of 70% of our turnover and profits result from recurring income in our core business of property management. The number of properties under management (including those managed by Moss Kaye) has grown by over 16% from last year. Results Turnover increased by £926,000, up 22% to £5,062,000 (2000: £4,136,000) for the twelve months to 31 December 2001. This excellent growth is the result of a strong performance from our property management operations and the inclusion of the results of Moss Kaye from 1 June 2001. However, the group has experienced increasing competition in the rented property business. The operating profit for the year ended 31 December 2001, before writing off exceptional costs, goodwill amortisation and interest, increased by 12% to £1,651,000 (2000: £1,472,000). Adjusted earnings per share, before exceptional costs, goodwill amortisation and interest, increased by 21.7% to 25.8p (2000: 21.2p). The acquisition of Moss Kaye has increased goodwill amortisation by £31,000 to £140,000 (2000: £109,000). The group incurred certain costs relating to abortive acquisitions and the promotion of new initiatives in 2001. These have been included within exceptional costs, which also include the balance of unrecovered abortive acquisition costs from 1999 and the transfer to reserves relating to the exercise of share options necessary under UTIF 17. Accordingly, after exceptional costs, goodwill amortisation and interest, pre-tax profits were £1,159,000 (2000: £1,212,000). Basic earnings per share were 17.6p (2000: 17.6p). The board is recommending the payment of an increased final dividend of 6.75p (2000: 6.25p) per share making a total for the year of 9.5p (2000: 8.8p). This will be paid on 24 June 2002 to shareholders on the register on 22 May 2002. Business development The board continues to focus strategically on organic growth, as well as on the acquisition of companies that can provide a strong fit with Solitaire's underlying business. On the 31 May 2001, Solitaire acquired the business of Moss Kaye and Roy Frank (now renamed Moss Kaye Pembertons Limited), the leading North London property management, commercial estate agency and professional services business. This acquisition has provided the group with increased and exciting opportunities to expand into the area of commercial property and it enables the company to provide a better service to its property clients by cross-selling professional services between group members. Property Investment Portfolio Management Services ('PIPS') is expected to make a positive contribution to group earnings this year as the size of its property management portfolio continues to expand following strong demand for its services. People We have an excellent management team whose dedication and clear focus enables the group to provide the highest level of service to its clients. I would like to express my sincere thanks to our staff, all of whom have worked hard and contributed to the continued success of the group over the last year. The future The continuing growth and medium to long-term nature of Solitaire's core business of residential management confirms Solitaire's position as one of the UK's market leaders in its sector. House builders continue to have faith in the UK economy and are increasing the pace of their developments. Solitaire will seek to benefit from this and from other opportunities as they arise in future years. Furthermore, I anticipate increasing opportunities for the acquisition of new property management contracts, following the passing of the Commonhold and Leasehold Reform Bill into law. George Brutton FRICS Chairman 23 April 2002 Consolidated profit and loss account Year ended 31 December Continuing Acquisitions operations 2001 2001 2001 2000 Notes £'000 £'000 £'000 £'000 ________ ________ ________ _______ Turnover 4,447 615 5,062 4,136 Operating expenses External fees and commissions 242 3 245 282 Other administration expenses 2,666 500 3,166 2,382 ________ ________ ________ _______ 1,539 112 1,651 1,472 Amortisation of goodwill and development costs 140 - 140 109 Exceptional costs 2 233 - 233 53 ________ ________ ________ _______ Operating profit 1,166 112 1,278 1,310 ________ ________ Interest receivable 8 22 Interest payable (127) (120) ________ _______ Profit on ordinary activities before 1,159 1,212 taxation Taxation on ordinary activities 354 410 ________ _______ Profit on ordinary activities after taxation 805 802 Dividends 5 433 401 ________ _______ Retained profit for the year 372 401 ________ _______ Basic and diluted earnings per share 5 17.6p 17.6p Adjustment for amortisation 3.1p 2.4p Adjustment for exceptional costs 5.1p 1.2p ________ _______ Adjusted earnings per share 25.8p 21.2p ________ _______ Balance sheets 31 December Group Company 2001 2000 2001 2000 £'000 £'000 £'000 £'000 ________ ________ ________ _______ Assets employed Fixed assets Intangible assets 1,880 1,005 - - Tangible assets 3 9,642 5,899 3,190 3,190 ________ _______ ________ _______ 11,522 6,904 3,190 3,190 ________ _______ ________ _______ Current assets Debtors 1,976 1,693 2,684 1,876 Cash and deposits 226 198 3 2 ________ _______ ________ _______ 2,202 1,891 2,687 1,878 Creditors: amounts falling due within 2,527 1,799 1,553 1,210 one year ________ _______ ________ _______ Net current (liabilities) / assets (325) 92 1,134 668 ________ _______ ________ _______ Total assets less current liabilities 11,197 6,996 4,324 3,858 Creditors: amounts falling due after 1,659 996 350 350 more than one year ________ _______ ________ _______ 9,538 6,000 3,974 3,508 ________ _______ ________ _______ Financed by Called-up share capital 462 456 462 456 Share premium 2,647 2,486 2,647 2,486 Revaluation reserve 4,731 1,731 - - Profit and loss account 1,698 1,327 865 566 ________ _______ ________ _______ Equity shareholders' funds 9,538 6,000 3,974 3,508 ________ _______ ________ _______ Consolidated cash flow statement Year ended 31 December 2001 2000 £'000 £'000 ________ _______ Cash flow from operating activities 1,283 1,410 Returns on investments and servicing of finance (119) (98) Taxation (384) (286) Capital expenditure and financial investment (824) (413) Acquisition of subsidiary (1,015) - Equity dividends paid (411) (369) ________ _______ Cash (outflow) / inflow before use of liquid resources and financing (1,470) 244 Financing 786 (280) ________ _______ Decrease in cash in the year (684) (36) ________ _______ Reconciliation of net cash flow to movement in net debt Decrease in cash in the year (684) (36) Cash flow from financing (786) 280 ________ _______ Changes in net funds resulting from cash flows (1,470) 244 Net debt at the beginning of the year (1,121) (1,365) ________ _______ Net debt at the end of the year (2,591) (1,121) ________ _______ SOLITAIRE GROUP Plc Notes 1. The results and balance sheet incorporate the audited results of Solitaire Group Plc and all its subsidiaries made up to 31 December 2001 and have been prepared on a basis consistent with the audited financial statements for the year ended 31 December 2000. 2. Certain costs resulting from abortive acquisitions and initiatives and transfers to reserves have been written off as exceptional costs. These costs are not, in the main, an allowable expense in the calculation of the tax charge for the year. 3. The directors have revalued the freehold reversions held by the group at the year end and increased the value by £3,000,000 4. During the year the company paid an interim dividend of 2.75p (2000: 2.55p) per share. The company has proposed a final dividend of 6.75p (2000: 6.25p) per share making a total of 9.5p (2000: 8.8p) for the year. 5. The calculation of earnings per share for the year ended 31 December 2001 is based on earnings of £805,000 (2000: £802,000) and a weighted average number of shares in issue of 4,575,873 (2000: 4,561,831). There is no significant difference between basic and diluted earnings per share in 2001 and 2000. The adjusted earnings per share are based on the profits for the year after tax adjusted for amortisation of goodwill and development costs and exceptional costs. 6. The results for the year ended 31 December 2001 have been extracted from the audited financial statements, which will shortly be sent to shareholders and filed with the Registrar of Companies. The auditor's report on these accounts was unqualified. This information is provided by RNS The company news service from the London Stock Exchange

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