1st Quarter Results
Workspace Group PLC
11 August 2003
SME SECTOR REMAINS IN GOOD SHAPE AS
WORKSPACE REPORTS PROGRESS
Workspace Group PLC ('Workspace'), today announces its results for the three
months ended 30 June 2003. Workspace is the leading provider of flexible
business accommodation to small and medium size enterprises ('SMEs') in London
and the South East.
• Turnover £11.91m for the quarter, up by 15.3% (2002: £10.33m)
• Pre-tax profits of £3.29m for the quarter, up 14.2% (2002: £2.88)
• Basic earnings per share at 14.4p for the quarter up 17.1% (2002: 12.3p)
• Annual rent roll £35.43m (30 June 2002: £30.42m)
- Refurbishment schemes underway will generate rental growth later in
the year
• Net asset value per share £15.22 at 30 June 2003 (31 March 2003: £15.10)
- (30 June 2002: £13.58)
Commenting on the results, Harry Platt, Chief Executive, said,
' The SME sector is resilient. Demand for our space remains strong. We are
continuing to see robust levels of enquiries, and conversions to lettings.
' Workspace continues to show a strong performance with consistent growth. We
are working hard to improve our offering and our strategy is paying off. The
average like-for-like rent has increased over the quarter by 1.4% to £8.30 per
sq. ft. Across the majority of our stock, excluding the properties that we are
re-furbishing or redeveloping and recent acquisitions, occupancy levels have
remained stable at 89.3%. At a headline level, however, occupancy is lower
mainly due to these planned voids. We anticipate the rent roll will increase
later in the year as the newly refurbished accommodation is let.
' We continue to look for acquisitions that have the potential to respond well
to our style of management. So far this year we have completed or have in legal
negotiation £35m of acquisitions. We anticipate reporting further progress in
the near future.
' Current trading is good and we are on track to deliver a performance that will
meet market expectations. The Board remains confident that the long-term outlook
for Workspace remains good.'
-ends-
Date: 11 August 2003
For further information please contact:
Workspace Group PLC City Profile Group
Harry Platt, Chief Executive Simon Courtenay
Mark Taylor, Finance Director 020 7448 3244
020 7247 7614
e-mail: info@workspacegroup.co.uk
Web: www.workspacegroup.co.uk
Operating & Financial Review
Overview
The business continues to develop and grow. Pre-tax profits for the quarter are
up 14.2% with trading profits up 13.1% on turnover up by 15.3% compared to the
same quarter last year.
Growth overall has been fuelled, as previously, by both organic growth in
rentals (like-for-like average rent increased by 1.4% over the quarter) and by
acquisitions (385,500 sq. ft has been added since 30 June 2002).
The increasing strength of the Workspace brand continued to generate high levels
of enquiries (over 100 per week) giving confidence in the underlying resilience
of the market.
Following the end of the quarter, one acquisition has been secured and others
are either in negotiation or with lawyers. Acquisitions could total over £35m in
the second quarter. Negotiations are also in progress on three disposals -
Thurston Road, Hooley Lane and Kingsland Viaduct -where again good progress is
hoped to be achieved by the half year stage.
Portfolio
Occupancy has dipped slightly during the quarter from 85.7% to 83.0% on an
overall basis. Of this decline approximately one third related to properties
subject to development and refurbishment where customers have had to be moved or
have chosen to move ahead of disturbance. These include refurbishment projects
at Barley Mow, Enterprise House, Europa and Clerkenwell and planned sales at
Thurston Road, Hooley Lane and Kingsland Viaduct (which is subject to a
Compulsory Purchase Order). Occupancy also fell in a number of the Group's
recently acquired properties. This is a commonplace phenomenon post acquisition
as the Group refocuses the management and operation of these properties.
Experience shows that following this initial dip, occupancy recovers with an
even stronger recovery in rentals as market rents are achieved on re-letting.
Excluding these developments, refurbishment and acquisitions the majority of the
Group's remaining properties (70 of the 92 sites overall) remained stable
(occupancy on these moving marginally from 90.3% to 89.3%) with total rents
growing despite this.
Excluding development sites, occupancy at the quarter end is a healthy 87.3%.
Following completion of the refurbishments, the effect of which is short term,
we expect occupancy and rents to rise. This increase will commence in the latter
part of the current financial year and so will not benefit income substantially
in this year but will assist in future periods.
Excluding the planned vacation of IPC from Enterprise House, releasing this
accommodation for refurbishment, overall rental income has been stable in the
quarter at £35.4m. Like-for-like rents have risen by 1.3% during the quarter,
from £8.19 per sq. ft to £8.30 sq ft.
As noted earlier, no major acquisitions and disposals were made in the quarter
(a minor disposal of a strip of land at one property was made in the period).
However, following the end of the quarter one acquisition has been completed:
Name of Property Description Acquisition/Sale Annual Income
Price
Acquisition:
Poplar Business Park, Modern B1 scheme, £16.10m £1.134m
London E14 comprising 33 units
totalling 75,000 sq. ft
Other acquisitions totalling £19m are in progress. The majority of these
acquisitions have been followed for many years. The Board has noted the
increased interest and competition for the type of property in which it invests
and the impact of this on the pricing of this property. With its considerable
experience of and research into this sector the Company understands well the
intrinsic value of such stock. Whilst it is prepared to pay the fair price for
its investments the Board has resolved not to chase properties at what it
considers to be excessive prices.
During the quarter, Lewisham Council resolved, subject to a S106 Agreement, to
approve our planning application for retail warehousing and housing at the
Thurston Road Industrial Estate. The Group has targeted the estate for early
disposal, along with Hooley Lane, Redhill, (which, subject to a S106 agreement,
has planning approval for residential use), and the Kingsland Viaduct (which is
the subject of a Compulsory Purchase Order to enable the development of the East
London Line). These disposals should realise in excess of £20m. The exit yields
for these sales will be little different to the cost of borrowing which leaves
scope for improvement in profitability as these sums are reinvested.
Financial Review
Earnings per share and net asset value per share have increased, driven by the
increase in turnover and profitability referred to earlier. Key statistics and
indicators may be summarised as: -
Quarter to Year to Quarter to
30/06/2003 31/03/2003 30/06/2002
Gross trading profit: turnover 72% 71% 71%
Operating profit: turnover 57% 57% 56%
PBT: turnover 28% 30% 28%
EPS per share (pence) 14.4 64.3 12.3
NAV per share (£) 15.22 15.10 13.58
Interest cover 1.92 * 2.18 2.00
Trading interest cover 1.91 1.97 2.00
Gearing 96% 98% 80%
Available facilities (£m) 60.5 75.0 130.0
* Excludes non-cash refinancing costs.
As may be seen trading ratios are consistent over all periods. EPS for the
quarter is 17.1% higher than the comparable period last year. EPS for the full
year to 31 March 2003 was assisted by a reduced tax charge for the year,
attributable to a prior year tax adjustment. EPS calculations for the current
quarter (and the previous year comparative) are based on tax charges at full
rates.
Interest cover has declined against the comparable period last year due to
increased gearing levels. It has improved (at a trading level) in the current
year at a time when gearing levels have been more comparable with the year end
value.
The Group continues to hold sufficient committed loan facilities to match its
capital expenditure and acquisition targets for the year.
Occupancy and Trading Statistics
The Group's key statistics relating to its trading operations are given in the
table below:
30 June 31 March
2003 2003
Number of estates 92 92
Total floorspace at end of period (sq. ft.) 5,103,237 5,104,519
of which:
Like for like portfolio (sq. ft.) 4,594,513 4,596,246
Net Acquisitions/Disposals (sq. ft.)
Three Mills and developments (sq. ft.) 508,724 508,273
Lettable units (number) 4,228 4,190
Annual rent roll of occupied units (£) 35,429,332 35,906,404
Average rent (£/sq. ft) 8.37 8.21
Average rent of like-for-like portfolio
(£/sq. ft) 8.30 8.19
Occupancy overall 83.0% 85.7%
Occupancy of like-for-like portfolio 87.3% 89.3%
Comparisons from period to period may be distorted by acquisitions, disposals
and transfers. The like-for-like portfolio is defined as those properties,
excluding Three Mills (which due to the short term nature of lettings of studio
space has a volatile occupancy rate which can obscure overall patterns), that
have been held throughout the year to date and which are not subject to
refurbishment/redevelopment programmes.
Prospects
The Group continues to maintain good levels of occupancy with enquiry levels and
conversion rates consistent with earlier periods. Where occupancy levels have
fallen more significantly this is generally attributable to estate related
issues (e.g. refurbishments) rather than wider instability in the tenant base
because of negative economic factors. The Group expects the rent roll to
increase more strongly later in the year as the various refurbishment works
underway complete and space is let. Meanwhile, in the current quarter the Group
expects to make a number of acquisitions and to reach agreement on a number of
key disposals. The Group is confident of achieving market expectations for the
year and in extending its position as the leading brand in the provision of
space to SMEs in London and the South East.
Consolidated Profit and Loss Account
for the 3 months ended 30 June 2003
Audited Unaudited 3 months ended 30 June
year ended
31 March
Trading Other Total Total
Operations Items
2003 Notes 2003 2002
£000 £000 £000 £000 £000
__________ ______________________________ ______ ___________ _____ _______ _______
44,965 Turnover - continuing operations 2 11,912 - 11,912 10,331
(12,944) Rent payable and direct costs (3,383) - (3,383) (2,948)
__________ ______________________________ ______ ___________ _____ _______ _______
32,021 Gross profit 8,529 - 8,529 7,383
(6,554) Administrative expenses (1,698) - (1,698) (1,626)
__________ ______________________________ ______ ___________ _____ _______ _______
Operating profit - continuing
25,467 operations 6,831 - 6,831 5,757
2,766 Surplus on disposal of investment - 27 27 2
property
173 Interest receivable 3 11 - 11 34
(14,993) Interest payable and similar charges 4 (3,582) - (3,582) (2,911)
__________ ______________________________ ______ ___________ _____ _______ _______
13,413 Profit on ordinary activities before 3,260 27 3,287 2,882
taxation
(3,046) Taxation on profit on ordinary 5 (979) (8) (987) (865)
activities
__________ ______________________________ ______ ___________ _____ _______ _______
10,367 Profit on ordinary activities after 19 2,281 19 2,300 2,017
taxation
- Equity minority interests - - - -
10,367 Profit attributable to shareholders 6 2,281 19 2,300 2,017
(4,471) Dividends - - - (23)
__________ ______________________________ ______ ___________ _____ _______ _______
5,896 Retained for the period 2,281 19 2,300 1,994
__________ ______________________________ ______ ___________ _____ _______ _______
64.3p Basic earnings per share 7 14.3p 0.1p 14.4p 12.3p
62.8p Diluted earnings per share 7 14.0p 0.1p 14.1p 12.1p
Statement of Total Recognised Gains and Losses
Audited Unaudited
Year ended 3 months ended 30 June
31 March
2003 2003 2002
£000 £000 £000
_______ __________________________________________________________ ___________ _________
10,367 Profit for the financial period 2,300 2,017
19,701 Unrealised surplus on revaluation of investment properties - -
_______ __________________________________________________________ ___________ _________
30,068 Total recognised gains relating to the financial period 2,300 2,017
_______ __________________________________________________________ ___________ _________
Note of Historical Cost Profits and Losses
Audited Unaudited
Year ended 3 months ended 30 June
31 March
2003 2003 2002
£000 £000 £000
_______ ____________________________________________________________________ ___________ _________
13,413 Reported profits on ordinary activities before taxation 3,287 2,882
15 Realisation of property revaluation gains/(losses) of previous years - -
_______ ____________________________________________________________________ ___________ _________
13,428 Historical cost profit on ordinary activities before taxation 3,287 2,882
_______ ____________________________________________________________________ ___________ _________
Historical cost profit for the period retained after taxation and
5,911 dividends 2,300 1,994
_______ ____________________________________________________________________ ___________ _________
Consolidated Balance Sheet
as at 30 June 2003
Audited Unaudited 30 June
31 March
2003 Notes 2003 2002
£000 £000 £000
________ _______________________________________ _______ ________ _________
Fixed Assets
Tangible assets
505,490 Investment properties 8 509,789 419,544
3,866 Other fixed assets 3,368 3,723
6,234 Investment in own shares 9 6,206 977
________ _______________________________________ _______ ________ _________
515,590 519,363 424,244
Current Assets
- Stock: properties for sale - 150
7,386 Debtors 10 7,292 6,600
3,109 Investments 11 1,053 5,304
________ _______________________________________ _______ ________ _________
456 Cash at bank and in hand 765 290
10,951 9,110 12,344
(28,835) Creditors: amounts falling due within one year 12 (31,129) (30,814)
________ _______________________________________ _______ ________ _________
(17,884) Net current liabilities (22,019) (18,470)
________ _______________________________________ _______ ________ _________
497,706 Total assets less current liabilities 497,344 405,774
Creditors: amounts falling due after more than one
(245,990) year (including Convertible Loan Stock) 13 (243,036) (178,441)
(4,107) Provision for liabilities and charges 15 (4,311) (3,601)
________ _______________________________________ _______ ________ _________
247,609 249,997 223,732
________ _______________________________________ _______ ________ _________
Capital and reserves
1,668 Called up share capital 16 1,670 1,659
42,697 Share premium account 17 42,783 42,432
164,274 Revaluation reserve 17 164,274 144,588
38,970 Profit and loss account 17 41,270 35,053
________ _______________________________________ _______ ________ _________
247,609 Shareholders' funds - equity interests 249,997 223,732
- Equity minority interests 19 - -
________ _______________________________________ _______ ________ _________
247,609 Capital Employed 18 249,997 223,732
________ _______________________________________ _______ ________ _________
£15.10 Net asset value per share £15.22 £13.58
________ _______________________________________ _______ ________ _________
Consolidated Cash Flow Statement
for the 3 months ended 30 June 2003
Audited year Unaudited
ended 31 March 3 months ended 30 June
2003 Notes to 2003 2002
£000 Cash Flow £000 £000
___________ _______________________________________ ________ __________ ___________
29,112 Net cash inflow from operating activities 1 8,387 5,553
(13,454) Return on investments and servicing of finance 2 (3,198) (2,049)
(2,372) Taxation (1,100) (742)
(75,225) Capital (expenditure)/proceeds - net 2 (2,924) (5,709)
(4,227) Equity dividends paid - -
___________ _______________________________________ ________ __________ ___________
Net cash inflow/(outflow) before use of liquid
(66,166) resources and financing 1,165 (2,947)
2,334 Management of liquid resources 2 2,056 138
66,715 Financing 2 (2,912) 3,011
2,883 Net cash inflow 3 309 202
Reconciliation of net cash flow to movement in
net debt
2,883 Increase in cash 309 202
(2,334) Decrease in liquid resources (2,056) (138)
(66,907) Inflow/(outflow) from movements in debt financing 2,954 (2,675)
(66,358) Changes in net debt resulting from cash flows 3 1,207 (2,611)
(176,067) Net debt at beginning of period (242,425) (176,067)
(242,425) Net debt at period end (241,218) (178,678)
Notes to the cash flow statement
for the 3 months ended 30 June 2003
1. Reconciliation of operating profit to operating cash flows
Audited year Unaudited
ended 31 March 3 months ended 30 June
2003 2003 2002
£000 £000 £000
______________ ___________________________ ________ ____________ __________
25,467 Operating profit 6,831 5,757
742 Depreciation charges 133 186
Profit on sale of tangible fixed
(3) assets (3) -
1,339 (Increase)/decrease in debtors (382) (413)
1,567 Increase in creditors 1,808 23
______________ ___________________________ ________ ____________ __________
29,112 8,387 5,553
______________ ___________________________ ________ ____________ __________
2. Analysis of cash flow
Audited year Unaudited 3 months
ended 31 March ended 30 June
2003 Notes 2003 2002
£000 to cash flow £000 £000
___________ ________________________________________ ________ ________ ________
Returns on investments and servicing of
finance
191 Interest received 11 32
(13,645) Interest paid (including financing costs) (3,209) (2,081)
___________ ________________________________________ ________ ________ ________
(13,454) Net cash outflow (3,198) (2,049)
___________ ________________________________________ ________ ________ ________
Capital expenditure
(73,192) Purchase of tangible fixed assets (4,225) (5,751)
(5,219) Net purchase of own shares 28 38
3,037 Sale of tangible fixed assets 1,273 (5)
149 Grants received - 9
___________ ________________________________________ ________ ________ ________
(75,225) Net cash outflow (2,924) (5,709)
___________ ________________________________________ ________ ________ ________
Management of liquid resources
2,334 Decrease in short-term deposits 3 2,056 138
___________ ________________________________________ ________ ________ ________
2,334 Net cash inflow 2,056 138
___________ ________________________________________ ________ ________ ________
Financing
687 Issue of ordinary share capital 88 413
180,500 (Repayment)/Drawdown of bank loans 3 (3,000) 3,500
(114,472) Repayment of securitised loan 3 - (902)
___________ ________________________________________ ________ ________ ________
66,715 Net cash (outflow)/inflow (2,912) 3,011
___________ ________________________________________ ________ ________ ________
3. Analysis of net debt
Audited year ended 31 March 2003 Unaudited 3months ended 30 June
At Cash flow At At Cash At At Cash At
01/04/03 flow
01/04/02 £000 31/03/03 30/06/02 01/04/02 flow 30/06/02
£000 £000 £000 £000 £000 £000 £000 £000
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
340 116 456 Cash at bank and in 456 309 765 340 (50) 290
hand
(2,767) 2,767 - Bank overdrafts - - - (2,767) 252 (2,515)
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
(2,427) 2,883 456 456 309 765 (2,427) 202 (2,225)
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
Debt due within one
year:
(3,660) 3,660 - Securitised loan - - - (3,660) - (3,660)
307 (307)* - Less cost of raising - - - 307 37* 344
finance
Debt due after one
year:
11% Convertible Loan
(2,900) - (2,900) Stock (2,900) - (2,900) (2,900) - (2,900)
11.125% First Mortgage
(12,500) - (12,500) Debenture (12,500) - (12,500) (12,500) - (12,500)
11.625% First Mortgage
(7,000) - (7,000) Debenture (7,000) - (7,000) (7,000) - (7,000)
(110,812) 110,812 - Securitised loan - - - (110,812) 902 (109,910)
(44,500) (180,500) (225,000) Bank loans (225,000) 3,000 (222,000) (44,500) (3,500) (48,000)
Less cost of raising of
1,982 (572)* 1,410 finance 1,410 (46)* 1,364 1,982 (114)* 1,868
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
(179,083) (66,907) (245,990) (245,990) 2,954 (243,036) (179,083) (2,675) (181,758)
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
5,443 (2,334) 3,109 Short-term deposits 3,109 (2,056) 1,053 5,443 (138) 5,305
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
(176,067) (66,358) (242,425) Total (242,425) 1,207 (241,218) (176,067) (2,611) (178,678)
________ ________ ________ ______________________ ________ _______ ________ ________ _______ _________
* Includes non-cash write-downs of financing costs.
Notes to the Quarterly Results
1. Basis of Preparation
The unaudited financial information contained in this quarterly report does not
comprise statutory accounts within the meaning of Section 240 of the Companies
Act 1985. The statutory accounts for the year ended 31 March 2003 included an
unqualified report of the auditors. The Group's unaudited accounts for the
period ended 30 June 2003 have been prepared on the basis of the accounting
policies set out in the Annual Report and Accounts for the year ended 31 March
2003.
2. Segmental Analysis
Audited Year ended 31 Unaudited
March 3 months ended 30 June
2003 2003 2002
£000 £000 £000
_______________ ___________________________________________ __________ _________
35,667 Rental Income 9,480 8,189
7,410 Service charge and other recoveries 2,099 1,856
1,888 Services fees, commissions, and sundry income 333 286
_______________ ___________________________________________ __________ _________
44,965 11,912 10,331
_______________ ___________________________________________ __________ _________
3. Interest receivable
Audited Year Unaudited
ended 31 March 3 months ended
30 June
2003 2003 2002
£000 £000 £000
_______________ ___________________________________________ ____________ _______
106 Short-term deposits 11 33
67 Other - 1
_______________ ___________________________________________ ____________ _______
173 11 34
_______________ ___________________________________________ ____________ _______
4. Interest payable and similar charges
Audited Year Unaudited
ended 31 March 3 months ended
30 June
2003 2003 2002
£000 £000 £000
__________________ ________________________________________ ____________ _______
361 11% Convertible Loan Stock 2011 80 80
1,391 11.125% First Mortgage Debenture Stock 2007 347 347
814 11.625% First Mortgage Debenture Stock 2007 204 204
Mortgage interest on securitised loan not wholly
1,884 repayable within five years* - 1,711
9,241 Bank and other interest on amounts wholly repayable 3,157 706
within five years*
1,861 Finance costs written off - -
__________________ ________________________________________ ____________ _______
15,552 3,788 3,048
(559) Interest capitalised on development properties (206) (137)
__________________ ________________________________________ ____________ _______
14,993 Charged to profit and loss account 3,582 2,911
__________________ ________________________________________ ____________ _______
* includes amortisation of cost of raising finance
5. Taxation
Audited year
ended 31 Unaudited
March 3 months ended 30 June
2003 2003 2002
£000 £000 £000
_______________ ________________________________________ ____________ __________
Current tax:
3,225 UK corporation tax on profit for the year 783 629
(921) Adjustment in respect of previous periods - -
_______________ ________________________________________ ____________ __________
_______________ ________________________________________ ____________ __________
2,304 Total current tax 783 629
_______________ ________________________________________ ____________ __________
Deferred tax:
742 Origination and reversal of timing differences 204 236
_______________ ________________________________________ ____________ __________
3,046 Tax on profit on ordinary activities 987 865
_______________ ________________________________________ ____________ __________
6. Dividends
Audited year Unaudited
Ended 31 March 3 months ended 30 June
2003 2003 2002
£000 £000 £000
______________ __________________________________________ ___________ __________
1,193 Interim dividend per ordinary share - -
3,292 Final dividend per ordinary share - -
(14) Under/(over) provision in prior year - 23
______________ __________________________________________ ___________ __________
4,471 - 23
______________ __________________________________________ ___________ __________
7. Earnings per share and net assets per share
The following table shows a reconciliation of profits used in calculating
earnings per share.
Audited year ended 31 Unaudited 3 months ended 30 June
March
Profit Earnings Profit Profit Earnings per share Earnings per
per share share 2002
2003 2003 2002 2003
2003 Pence
£000 £000 £000 Pence
£000
_________ ________ ______________________ _______ ________ ______________ _________
Profit for the period
10,367 64.3 attributable to shareholders 2,300 2,017 14.4 12.3
(671) (4.2) Other items (19) - (0.1) -
_________ ________ ______________________ _______ ________ ______________ _________
9,696 60.1 Profit for the period 2,281 2,017 14.3 12.3
attributable to shareholders
used for calculating earnings
per share excluding other items
_________ ________ ______________________ _______ ________ ______________ _________
Reconciliation of profit used in calculating diluted earnings per share
Audited year ended 31 Unaudited 3 months ended 30 June
March
_________ ________ ______________________ _______ ________ ______________ _________
Profit Earnings Profit 2003 Profit Earnings per share Earnings per
per share 2003 share 2002
2003 £000 2002
2003 Pence Pence
£000 £000
£000
_________ ________ ______________________ _______ ________ ______________ _________
10,367 Profit for the period 2,300 2,017
attributable to shareholders
used for calculating basic
earnings per share
223 Interest saving net of taxation 56 56
on 11% Convertible Loan Stock
_________ ________ ______________________ _______ ________ ______________ _________
10,590 62.8 Profit for the period 2,356 2,073 14.1 12.1
attributable to shareholders
used in calculating the
underlying diluted earnings per
share
(671) (4.0) Other items (19) - (0.1) -
_________ ________ ______________________ _______ ________ ______________ _________
9,919 58.8 Profit for the period 2,337 2,073 14.0 12.1
attributable to shareholders
used in calculating the diluted
earnings per share excluding
other items
_________ ________ ______________________ _______ ________ ______________ _________
The following table shows a reconciliation of the weighted average number of shares used for calculating the basic and
diluted earnings per share
Audited year ended Unaudited 3 months ended 30 June
31 March 2003
2003 2002
____ ____________ _________________________ ___________________ _____________________
Used for calculating basic
16,119,277 earnings per share 15,984,574 16,340,209
Dilution due to Share Option
158,075 Scheme 125,346 223,060
Dilution due to Convertible Loan
580,000 Stock 580,000 580,000
____ ____________ _________________________ ___________________ _____________________
Used for calculating diluted
16,857,352 earnings per share 16,689,920 17,143,269
____ ____________ _________________________ ___________________ _____________________
Net assets per share have been calculated by dividing net assets of £249,997,000 (2002: £223,732,000) less investment in
own shares of £6,205,627 (2002: £977,091) by 16,015,675 (2002: 16,402,695) being the number of shares in issue at 30
June 2003 less investment in own shares of 689,666 (2002: 192,420).
8. Investment properties
Unaudited 30 June
Audited Freehold Mainly Long Short leasehold Total Total
Freehold leasehold
31 March £000 £000 2003 2002
2003 £000 £000
£000 £000
£000
____________________________________________________________________________________________________________
414,707 Balance at 1 April 377,935 71,060 56,495 - 505,490 414,707
2003/2002
73,680 Additions during 2,768 868 21 - 3,657 4,837
the period
- Reclassification 589 53 - - 642 -
from other fixed
assets
(2,598) Disposals during - - - - - -
the period
19,701 Revaluation during - - - - - -
the period
____________________________________________________________________________________________________________
505,490 Balance at period 381,292 71,981 56,516 - 509,789 419,544
end
____________________________________________________________________________________________________________
The historical
cost of investment
properties
____________________________________________________________________________________________________________
340,472 Balance at period 253,089 49,531 42,438 7 345,065 274,196
end
____________________________________________________________________________________________________________
Valuation
No valuation of investment properties has been carried out at 30 June 2003. The
valuation shown in the unaudited accounts is based on the independent valuation
at 31 March 2003, plus additions at cost less disposals at value.
9. Investment in own shares
The Company has established an Employee Share Ownership Trust (ESOT) to purchase
shares in the market for distribution at a later date in accordance with the
terms of the 1993 and 2000 Share Option Schemes. The shares are held by an
independent trustee and the rights to dividend on the shares have been waived.
At 30 June 2003, the number of shares held by the Trust totalled 689,666 shares
(2002: 192,420) with a nominal value of £68,967 (2002: £19,242) and the book
value of the shares amounted to £6,205,627 (2002: £977,091). The shares, whilst
legally not the property of the Company, have been included in fixed asset
investments. At 30 June 2003 the market value of the shares held by the Trust
was £7,810,467. 586,606 shares held by the Trust are subject to option awards.
10. Debtors
Audited Unaudited 30 June
31 March
2003 2003 2002
£000 £000 £000
___________ ___________________________________________ __________ _________
Amounts falling due within one year:
6,294 Trade debtors 4,535 3,587
- Deposits on investment acquisitions 805 -
37 Taxation and social security 34 -
1,055 Prepayments and accrued income 1,918 2,876
___________ ___________________________________________ __________ _________
7,386 7,292 6,463
___________ ___________________________________________ __________ _________
Amounts falling due after one year:
- Advance commissions - 137
___________ ___________________________________________ __________ _________
7,386 Total debtors 7,292 6,600
___________ ___________________________________________ __________ _________
11. Investments
Investments of £1,053,000 (2002: £5,304,000) comprise short-term deposits with
an original maturity date of less than three months and rental deposits.
12. Creditors: Amounts falling due within one year
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
______________ _____________________________________________________ __________ __________
- Bank loan and overdraft (less cost of raising finance) - 5,832
3,026 Trade creditors 3,459 2,594
1,925 Corporation tax payable 1,607 1,879
1,946 Taxation and social security 2,776 1,077
5,154 Tenants' deposits 5,179 4,397
8,231 Accruals 9,678 7,030
5,261 Deferred income - rent and service charges 5,138 4,933
3,292 Dividends 3,292 3,072
______________ _____________________________________________________ __________ __________
28,835 31,129 30,814
______________ _____________________________________________________ __________ __________
13. Creditors: Amounts falling due after more than one year
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
______________ _________________________________________ __________ __________
Long-term borrowings consist of:
Unsecured:
2,900 11% Convertible Loan Stock 2011 2,900 2,900
Secured:
12,500 11.125% First Mortgage Debenture Stock 2007 12,500 12,500
7,000 11.625% First Mortgage Debenture Stock 2007 7,000 7,000
223,590 Other secured loans 220,636 159,357
______________ _________________________________________ __________ __________
245,990 243,036 181,757
- Less: amounts falling due within one year - (3,316)
______________ _________________________________________ __________ __________
245,990 243,036 178,441
______________ _________________________________________ __________ __________
14. Borrowings and financial instruments
i Maturity of financial liabilities
A maturity analysis of loans is shown below:
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
______________ _________________________________________ __________ _________
- Less than one year - -
- Between one year and two years - -
- Between two years and three years - -
- Between three years and four years - -
244,500 Between four years and five years 241,500 177,409
2,900 In five years and more 2,900 2,900
______________ _________________________________________ __________ _________
______________ _________________________________________ __________ _________
247,400 244,400 180,309
(1,410) Less cost of raising finance (1,364) (1,868)
______________ _________________________________________ __________ _________
245,990 243,036 178,441
______________ _________________________________________ __________ _________
ii Fair value of financial assets and liabilities
Book and fair values of financial assets and liabilities are:
Audited 31 March Unaudited 30 June
Book value Fair value Book Value Fair value
2003 2003 2003 2002 2002
£000 £000 £000 £000 £000
________ ________ _____________________________ ________ ________ _________ ________
Book Value Fair Value
Primary financial instruments
- - Short-term liabilities - - (5,832) (5,832)
(245,990) (251,093) Long-term borrowing (243,036) (248,560) (178,441) (183,823)
3,565 3,565 Financial assets 1,818 1,818 5,594 5,594
Derivative financial
instruments
244 (6,724) Interest rate collars 235 (7,433) 273 (2,481)
________ ________ _____________________________ ________ ________ _________ ________
(242,181) (254,252) (240,983) (254,175) (178,406) (186,542)
________ ________ _____________________________ ________ ________ _________ ________
The fair value of the interest rate collars have been determined by reference to
market prices and discounted expected cash flows at prevailing interest rates.
All other fair values have been calculated by discounting expected cash flows at
prevailing interest rates. The total fair value adjustment equates to 82.4 pence
per share (63.0 pence) based on diluted share capital.
15. Provision for liabilities and charges
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
_____________________ ________________________ _____________________ ____________________
Deferred taxation:
3,365 Balance at 1 April 2003/ 4,107 3,365
2002
742 Deferred tax charge for 204 236
the period
_____________________ ________________________ _____________________ ____________________
4,107 Balance at period end 4,311 3,601
_____________________ ________________________ _____________________ ____________________
If the investment properties were sold for their revalued amount there would be a potential liability to corporation tax
of £38,889,000 (31 March 2003: £39,986,000, 30 June 2002: £36,146,000).
16. Share capital
Audited 31 March Unaudited 30 June
2003 2003 2002
Number Number Number
_____________________ ___________________________ ___________________ ____________________
Authorised:
21,500,000 Ordinary shares of 10p each 21,500,000 21,500,000
_____________________ ___________________________ ___________________ ____________________
_____________________ ___________________________ ___________________ ____________________
2003 2003 2002
£ £ £
Issued:
_____________________ ___________________________ ___________________ ____________________
1,667,808 Fully paid ordinary shares of 1,670,534 1,659,512
10p each
_____________________ ___________________________ ___________________ ____________________
17. Other reserves
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
_____________ __________________________________________ _________ __________
(a) Share premium account
42,030 Balance at 1 April 2003/2002 42,697 42,030
667 Additions 86 402
_____________ __________________________________________ _________ __________
42,697 Balance at period end 42,783 42,432
_____________ __________________________________________ _________ __________
(b) Revaluation reserve
Property valuation surplus:
144,588 Balance at 1 April 2003/2002 164,274 144,588
(15) Disposals during the period - -
19,701 Revaluation adjustment - -
_____________ __________________________________________ _________ __________
164,274 Balance at period end 164,274 144,588
_____________ __________________________________________ _________ __________
(c) Profit and loss account
33,059 Balance at 1 April 2003/2002 38,970 33,059
5,896 Retained profit for the period 2,300 1,994
15 Transfer from revaluation reserve - -
_____________ __________________________________________ _________ __________
38,970 Balance at period end 41,270 35,053
_____________ __________________________________________ _________ __________
18. Reconciliation of movements in shareholders' funds
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
_____________ ________________________________________________ _________ __________
10,367 Profits for the financial period 2,300 2,017
(4,471) Dividends - (23)
19,701 Unrealised surplus on revaluation of properties - -
687 Issue of shares 88 413
_____________ ________________________________________________ _________ __________
26,284 Net addition to shareholders' funds 2,388 2,407
221,325 Opening shareholders' funds 247,609 221,325
_____________ ________________________________________________ _________ __________
247,609 Closing shareholders' funds 249,997 223,732
_____________ ________________________________________________ _________ __________
19. Equity minority interests
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
_____________ __________________________________________________ _________ __________
74 Share of loss of subsidiary undertaking 19 17
(74) Provision against losses of subsidiary undertaking (19) (17)
_____________ __________________________________________________ _________ __________
- - -
£nil has been appropriated to minority interests in all periods shown in this
statement.
20. Capital commitments
At the period end the estimated amounts of commitments for future capital
expenditure not provided for were:
Audited 31 March Unaudited 30 June
2003 2003 2002
£000 £000 £000
______________ _____________________________________________ _________ _______
8,038 Under contract 22,503 5,010
2,913 Board authorised but not contracted 4,116 6,719
______________ _____________________________________________ _________ _______
21. Subsequent events
Following the quarter end the Poplar Business Park, London E14 was purchased for
a cash consideration of £16,100,000. This property has an annual income stream
of £1,134,000. Contracts have been exchanged for a further purchase totalling
£3,380,000
22. Quarterly statement
This statement was approved by the Board on 8th August 2003. Copies of this
statement will be dispatched to shareholders on Monday 11 August 2003 and will
be available from the Group's registered office at Magenta House, 85 Whitechapel
Road, London E1 1DU from 9.00am on that day.
This information is provided by RNS
The company news service from the London Stock Exchange
Latest directors dealings
- 2 hours ago Regional REIT Limited
- 2 hours ago Regional REIT Limited
- 2 hours ago Polar Capital Holdings
- 3 hours ago Norcros
- 3 hours ago London Stock Exchange Group