Final Results

Braemar Group PLC 12 June 2007 Braemar Group plc 12 June 2007 AUDITED FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2007 Financial Highlights â€¢ Turnover up to Â£2.4 million (2006 Â£0.3 million) â€¢ Gross profit up to Â£657,000 (2006 Â£156,000) â€¢ Operating loss before goodwill amortisation narrowed to Â£166,000 (2006 loss of Â£263,000), which represents an operating profit in the second half. The Group has continued to make good progress in the year ended 31 March 2007, our first full trading year since the reverse takeover of The Braemar Group Limited in December 2005. Financial Overview Turnover for the year has increased to Â£2,365,000 (2005 Â£269,000), which has been built through a combination of growth in our property and fund administration division and the launch, in October 2006, of our corporate finance division. The performance in the second half of the year showed a marked improvement on the first half reflecting a successful return on the investments made in the first half in personnel and developing our range of services. The Group recorded an operating profit, before goodwill amortisation, of Â£17,000 in the six months ended 31 March 2007, compared with an operating loss, before goodwill amortisation, of Â£183,000 in the first six months, a turn-around of Â£200,000, resulting in an overall operating loss, before goodwill amortisation, for the year of Â£166,000. This is the third successive half-yearly improvement in the operating performance of the Group. Cash balances at the year-end were Â£767,000 (2006: Â£557,000) and net assets at the year end were Â£2,113,000 (2006: Â£2,409,000). Business Review 1. Strategy Our strategy remains that of developing our residential property fund management business, linked to the continued development of our support services in corporate finance and property management and trading. Fund management has been enhanced by the key addition of the support services the Group provides. Property management, block management and corporate finance enable us to provide quality services in-house for our funds while expanding the base of our recurring fee income and taking on external mandates. The growth in contribution from these support areas has helped the Group to achieve overall profitability, before goodwill amortisation, in the second half of the year. Braemar Securities Limited, our corporate finance division has been granted authorisation by the Financial Services Authority ('FSA') and has delivered an operating profit of over Â£100,000 in its first six months of operation. We continue to seek further opportunities to expand the range of our services to deliver high quality services to our funds and external clients. 2. Fund and Property Administration Our property and fund management division has had a good year with the successful close of Coronation IV in January 2007, our fourth such product, and was our largest fund to date. The fund acquired, from the Group, a prime site in the city centre of Harrogate, known as the Toffee Works, which is now being converted to residential use by the fund. We continue to pursue other opportunities for this and our future funds and have identified a strong pipeline of further properties that we are actively reviewing for potential acquisition. Building on the success of these funds, Coronation V was launched in May 2007 to continue providing our investors with a blend of tax allowances and exposure to the residential property market. Coronation V remains open for investment until the end of August 2007. In addition, our property management expertise has been expanded in the year to include block management, which allows us to service the management needs of our funds and has enabled us to secure a number of external mandates. This complements our existing lettings management arm, which continues to perform strongly to maximise returns for our funds and external landlords. 3. Corporate Finance Braemar Securities Limited was granted authorisation by the FSA on 2 October 2006 to conduct corporate finance business and to arrange finance for public and private companies. It acted as the promoter of Coronation IV and completed four external assignments in the six months ended 31 March 2007. The external assignments included acting as financial adviser to Poly Information plc, a short term asset finance business, on its reverse takeover and re-admission to AIM under its new name of Regenesis Group plc and assisting Plant Impact plc on a placing and admission to AIM. Braemar Securities has also acted as sponsor to the issue by Visible Films of three UK Listing Authority approved prospectuses. Braemar Securities acquired 2.3m shares in Regenesis Group plc as part of its fee and these are included in the Group's balance sheet at 3.5 pence per share. Other In August 2006, the Group acquired a long-leasehold interest in the Toffee Works, Harrogate. The Group subsequently secured amended planning permission, completed negotiations with all contractors and advisers, and made a significant start to the development of the property to form a number of residential apartments and retail premises. On 25 January 2007, the residential portion of the building was sold for Â£1,290,000. The Group has retained an interest in the retail premises, for which a tenant has now been found and the Directors have decided to retain the property as an investment for the Group. In October 2006, the Group sold its freehold interest in a non-core residential property for Â£240,000, which had been bought as an investment in 2004 for Â£110,000. Current Trading and Prospects The current year has started well, with the launch of Coronation V, additional external mandates for the block management business and a high level of enquiries for corporate finance assignments. We are continuing with our preparations for the launch of our residential property fund for the SIPP market and are encouraged by the level of interest in Coronation V driven by our growing sales team, which includes two further recent recruits. This continued investment in our business, while increasing our underlying costs, is expected to generate returns over the next twelve to eighteen months. Since the balance sheet date, the Group's borrowings have been reduced following the redemption of Â£406,000 of loan notes and accrued interest paid to the vendors of The Braemar Group Limited. The Directors are pleased with the progress of the Group to date and envisage further organic growth in the coming year. In a separate announcement, issued today, we have announced the acquisition of The Armchair Property Investor Limited ('Armchair') for a consideration of Â£2.19m, of which Â£2m is deferred. Armchair will form a new division of the Group, concentrating on residential property sales direct to the public. Armchair, a property investment consultancy carries over 10,000 registered users, and introduces private investors directly to residential property opportunities. Armchair will add a retail focus to our existing sales network which is IFA driven, and will interact with other services appropriately. CONSOLIDATED PROFIT AND LOSS ACCOUNT YEAR ENDED 31 MARCH 2007 6 months Year ended ended 31 March 31 March 2007 2006 Notes Â£'000 Â£'000 TURNOVER 2 2,365 269 Cost of sales (1,708) (113) GROSS PROFIT 657 156 Administration expenses (937) (454) Operating loss pre goodwill amortisation (166) (263) Goodwill amortisation (114) (35) OPERATING LOSS (280) (298) Interest receivable 6 27 11 Interest payable and similar charges 7 (47) (14) LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (300) (301) TAXATION 8 4 - LOSS FOR THE FINANCIAL PERIOD (296) (301) Loss per share 9 0.26p 0.42p All amounts relate to continuing operations. The Group has no recognised gains or losses other than the results for the period as set out above. CONSOLIDATED BALANCE SHEET 31 MARCH 2007 2007 2006 Notes Â£'000 Â£'000 FIXED ASSETS Intangible assets 10 2,130 2,244 Tangible assets 11 21 31 Investment properties under development 12 142 - Fixed asset investments 13 4 2 2,297 2,277 CURRENT ASSETS Stock 14 - 125 Debtors 15 246 548 Cash at bank and in hand 21 767 557 Current asset investments 16 82 - 1,095 1,230 CREDITORS Amounts falling due within one year 17 (1,279) (1,098) NET CURRENT (LIABILITIES)/ ASSETS (184) 132 TOTAL ASSETS LESS CURRENT LIABILITIES 2,113 2,409 NET ASSETS 2,113 2,409 CAPITAL AND RESERVES Called up equity share capital 18 1,140 1,138 Share premium account 19 1,957 1,959 Profit and loss account 19 (984) (688) SHAREHOLDERS' FUNDS 20 2,113 2,409 The financial statements were approved and authorised for issue by the Board and were signed on its behalf on 12 June 2007 W M Robinson J S Murphy Chairman Director COMPANY BALANCE SHEET 31 MARCH 2007 2007 2006 Notes Â£'000 Â£'000 FIXED ASSETS Tangible assets 11 9 3 Investments 13 2,615 2,590 2,624 2,593 CURRENT ASSETS Debtors 15 112 414 Cash at bank and in hand 615 512 727 926 CREDITORS Amounts falling due within one year 17 (1,537) (1,040) NET CURRENT (LIABILITIES) (810) (114) TOTAL ASSETS LESS CURRENT LIABILITIES 1,814 2,479 NET ASSETS 1,814 2,479 CAPITAL AND RESERVES Called up share capital 18 1,140 1,138 Share premium account 19 1,957 1,959 Profit and loss account 19 (1,283) (618) SHAREHOLDERS' FUNDS 20 1,814 2,479 The financial statements were approved and authorised for issue by the Board and were signed on its behalf on 12 June 2007 W M Robinson J S Murphy Chairman Director CONSOLIDATED CASH FLOW STATEMENT YEAR ENDED 31 MARCH 2007 6 months Year ended ended 31 31 March March Notes 2007 2006 Reconciliation of operating loss to net cash inflow /(outflow) Â£'000 Â£'000 from operating activities Operating loss (280) (298) Loss on sale of fixed assets 6 - Amortisation of intangible assets 114 35 Depreciation of tangible fixed assets 6 4 Movement in short-term investments (53) - Payments to acquire short-term investments (31) - Decrease/ (Increase) in debtors 270 (132) Increase in creditors 153 101 Decrease in stocks 125 - Net cash inflow/ (outflow) from operating activities 310 (290) CASH FLOW STATEMENT Net cash inflow /(outflow) from operating activities 310 (290) Returns on investments and servicing of finance Interest paid (1) (4) Interest received 27 11 1 7 Net cash inflow from returns on investments and servicing of finance 26 7 Taxation received /(paid) 19 (68) Capital expenditure and financial investment Payments to acquire tangible fixed assets (13) (12) Acquisition of The Braemar Group Limited - (593) Payments to acquire investment properties (142) Receipts from the sale of tangible fixed assets 10 - Net cash outflow from capital expenditure and financial investment (145) (605) Net cash inflow /(outflow) before financing 210 (956) Financing Issue of share capital 5 1,623 Share issue costs (5) (199) Net cash inflow from financing - 1,424 INCREASE IN CASH 21 210 468 NOTES TO THE FINANCIAL STATEMENT YEAR ENDED 31 MARCH 2007 1 ACCOUNTING POLICIES The principal accounting policies adopted by the Group and the Company are as follows. (a) Convention The financial statements have been prepared under the historical cost convention and in accordance with applicable United Kingdom Accounting Standards. (b) Basis of Consolidation The consolidated profit and loss account and balance sheet includes the financial statements of the Company and its subsidiary undertakings made up to 31 March 2007. The results of subsidiaries sold or acquired are included in the profit and loss account up to, or from, the date control passes. Intra-group sales and profits are eliminated fully on consolidation. A separate profit and loss account for the parent company has not been prepared as permitted by Section 230(2) of the Companies Act 1985. The loss for the parent company for the year to 31 March 2007 was Â£665,000 (2006 loss - Â£231,000). (c) Turnover Turnover comprises gross sale proceeds of trading properties, gross rentals, commissions and sundry income and the invoiced value of goods and services supplied by the Group net of VAT. (d) Deferred Taxation Deferred tax is provided in full in respect of taxation deferred by timing differences between the treatment of certain items for taxation and accounting purposes. Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered. The Group has not adopted a policy of discounting deferred tax assets and liabilities. (e) Goodwill For acquisitions of a business, purchased goodwill is capitalised in the year in which it arises and amortised over its estimated useful economic life up to a maximum of twenty years. (f) Tangible Fixed Assets and Depreciation Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment. Depreciation is calculated to write down the cost of assets to their estimated residual values over their estimated useful economic life over a period of 4 years on a straight line basis. (g) Investment Properties under Development Investment properties under development are stated at the lower of cost and net realisable value. Cost comprises purchase price, acquisition and development costs and interest that is directly attributable to the financing of the property. (h) Fixed Asset Investments Investments are stated at cost less provision for impairment. (i) Current Asset Investments Investments are stated at the lower of cost and net realisable value. (j) Carried Interest Receivable The Group earns a performance fee ('carried interest receivable') on funds it manages on behalf of its investors. Carried interest receivable is recognised where, at the balance sheet date, the performance criteria have been met based on the valuations of the funds. Carried interest that has been earned, but where the amounts are not yet due for payment is discounted to its present value. (k) Leasing and Hire Purchase Assets obtained under hire purchase contracts and finance leases are capitalised as tangible fixed assets. Assets acquired by finance lease are depreciated over the shorter of the lease term and their useful lives. Assets acquired by hire purchase are depreciated over their useful lives. Finance leases are those where substantially all of the benefits and risks of ownership are assumed by the Group. Obligations under such agreements are included in creditors net of the finance charge allocated to future periods. The finance element of the rental payment is charged to the profit and loss account so as to produce a constant periodic rate of charge on the net obligation outstanding in each period. (l) Operating Leases Rentals under operating leases are charged on a straight line basis over the lease term. Benefits received and receivable as an incentive to sign an operating lease are recognised on a straight line basis over the period until the date the rent is expected to be adjusted to the prevailing market rate. (m) Pensions The Group operates a defined contribution pension scheme and the pension costs charged against profits represent the amount of contributions payable to the scheme in the year. Differences between contributions payable and contributions actually paid are shown as either accruals or prepayments in the balance sheet. (n) Share Based Payments During the year the Company completed an equity-settled share-based payment transaction with a supplier. The fair value of the services received in exchange for the grant of shares is recognised as an expense. 2 SEGMENTAL ANALYSIS 6 months Year ended ended 31 March 31 March 2007 2006 Turnover Â£'000 Â£'000 Property and Fund Administration 642 253 Corporate Finance 198 - Other 1,525 16 2,365 269 Loss on ordinary activities before taxation 2007 2006 Â£'000 Â£'000 Property and Fund Administration 160 90 Corporate Finance 106 - Other (566) (391) (300) (301) Included within Other is turnover of Â£1,520,000 (2006 Â£nil) and profit before tax of Â£98,000 (2006 Â£nil) relating to property trading. The total turnover of the Group for the year has been derived wholly from activity undertaken in the United Kingdom. 3 OPERATING LOSS The operating loss is stated after charging: Year ended 6 months 31 March ended 31 March 2007 2006 Â£'000 Â£'000 Amortisation of goodwill 114 35 Depreciation of fixed assets 6 4 Auditors' remuneration - audit 5 5 - audit of accounts of associates pursuant to legislation 7 7 - other services relating to tax 3 3 Rentals under operating leases 32 26 Loss on the sale of fixed assets 6 - 4 STAFF COSTS Group Group Company Company Year 6 months Year 6 months ended ended ended ended 31 March 31 March 31 March 31 March 2007 2006 2007 2006 Â£'000 Â£'000 Â£'000 Â£'000 (a) Staff costs comprise: Wages and salaries 449 219 427 188 Social security 51 16 49 14 Pension costs (see note 27) 12 - 12 - 512 235 488 202 (b) Employees Group Group 2007 2006 The average number of employees including directors, during the year was: 12 8 5 DIRECTORS' EMOLUMENTS The total amounts for directors' remuneration and other benefits were as follows: Year ended 31 6 months March ended 2007 31 March 2006 Â£'000 Â£'000 Emoluments 263 186 Money purchase pension contributions 11 - Total 274 186 Amounts paid to each director from the Group companies during the period are set out below: 6 months Year ended 6 months ended Year ended ended 31 March 31 March 31 March 31 March 2007 2006 2007 2006 Pension Pension Emoluments Emoluments contributions contributions Executive Directors Â£'000 Â£'000 Â£'000 Â£'000 Executive Directors Martin Robinson 80 34 2 - Marc Duschenes 106 34 3 - Jonathan Murphy 45 - 6 - Gordon Maclean 12 86 - - Non-Executive Director Anthony McFarland 20 32 - - Total 263 186 11 - Other In the year Jonathan Murphy waived his entitlement to emoluments of Â£4,000 in return for a one-off pension contribution of Â£4,000. 6 INTEREST RECEIVABLE Year 6 months ended ended 31 31 March March 2007 2006 Â£'000 Â£'000 Interest receivable and similar income 27 11 7 INTEREST PAYABLE Year 6 months ended ended 31 March 31 March 2007 2006 Â£'000 Â£'000 Bank interest 1 - Interest on other loans 46 14 Total interest payable 47 14 8 TAXATION Year 6 months ended ended 31 March 31 March 2007 2006 Â£'000 Â£'000 Tax on ordinary activities 4 - The differences between the total current tax shown above and the amount calculated by applying the standard rate of UK corporation tax of 30% (2006: 30%) to the profit and loss is as follows: Year 6 months ended ended 31 March 31 March 2007 2006 Â£'000 Â£'000 Loss on ordinary activities before tax (300) (301) Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 30% (90) (90) Effects of: Expenses not deductible for tax purposes 39 16 Capital allowances in excess of depreciation 3 - Movement in tax losses 33 72 Adjustment re: prior year 4 Other short term timing differences 15 2 4 - No adjustment has been made to the financial statements to reflect a potential deferred tax asset that would arise from future utilisation of the Group's available losses for tax purposes, due to the uncertainty over the timing of such utilisation. The potential deferred tax asset that would arise on full utilisation would amount to approximately Â£211,000. 9 LOSS PER SHARE Year 6 months ended ended 31 March 31 March 2007 2006 Â£'000 Â£'000 Loss for the period 296 301 Weighted average number of shares 113,795,978 72,454,432 Loss per share - basic 0.26p 0.42p Reconciliation to loss per share before goodwill amortisation is shown below: Year 6 months ended 31 ended March 31 March 2007 2006 Â£'000 Â£'000 Loss for the year 296 301 Goodwill amortisation (114) (35) Loss for the year before goodwill amortisation 182 266 Weighted average number of shares 113,795,978 72,454,432 Loss per share before goodwill 0.16p 0.36p amortisation There are 31,441,800 potentially issuable shares that have not been included in a diluted EPS calculation as they are anti-dilutive. 10 INTANGIBLE FIXED ASSETS - GOODWILL Group 2007 Cost Â£'000 At 1 April 2006 and at 31 March 2007 2,279 Amortisation At 1 April 2006 (35) Charge for the period (114) At 31 March 2007 (149) Net book value At 31 March 2006 2,244 At 31 March 2007 2,130 11 TANGIBLE FIXED ASSETS Group Group Group Company Company Motor vehicle Fixtures, Fixtures, fittings and fittings and office office equipment equipment Total Total Cost Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 At 1 April 2006 21 13 34 3 3 Additions - 12 12 8 8 Disposals (21) - (21) - - At 31 March 2007 - 25 25 11 11 Depreciation At 1 April 2006 3 - 3 - - Charge for the period 2 4 6 2 2 Disposals (5) - (5) - - At 31 March 2007 - 4 4 2 2 Net Book Value At 31 March 2006 18 13 31 3 3 At 31 March 2007 - 21 21 9 9 12 INVESTMENT PROPERTIES UNDER DEVELOPMENT Group Company 2007 2006 2007 2006 Â£'000 Â£'000 Â£'000 Â£'000 Investment properties under development 142 - - - 13 FIXED ASSET INVESTMENTS Group Other investments Â£'000 Cost - unlisted investments At 1 April 2006 2 Additions 2 At 31 March 2007 4 Company - unlisted investments Share in Group Undertakings Â£'000 Cost At 1 April 2006 2,590 Additions 25 At 31 March 2007 2,615 The Company has investments in the following subsidiary undertakings, which are all incorporated in England and Wales and are owned 100%: Subsidiaries Principal activity Braemar Investment Management Limited Property and investment managers and investors Braemar Securities Limited Corporate finance company Heath Road Investments Limited Intermediate holding company Coronation General Partner Limited Fund manager Coronation Carried Interest Limited Dormant Coronation Nominee Limited Dormant Coronation General Partner II Limited Fund manager Coronation Carried Interest II Limited Dormant Coronation Nominee II Limited Dormant Coronation General Partner III Limited Fund manager Coronation Carried Interest III Limited Dormant Coronation Nominee III Limited Dormant Coronation General Partner IV Limited Fund manager Coronation Carried Interest IV Limited Dormant Coronation Nominee IV Limited Dormant Taylor Richardson II Properties plc Dormant During the year the Company established a wholly owned subsidiary, Braemar Securities Limited, to provide corporate finance services. The Company subscribed for Â£25,000 of ordinary shares which were fully paid at 31 March 2007. 14 STOCK Group Company 2007 2006 2007 2006 Â£'000 Â£'000 Â£'000 Â£'000 Property held for resale - 125 - - 15 DEBTORS Group Company 2007 2006 2007 2006 Â£'000 Â£'000 Â£'000 Â£'000 Trade debtors 158 78 7 - Amounts due from group undertakings - - 53 67 Corporation tax recoverable - 15 - - VAT receivable 17 17 10 8 Other debtors 22 338 11 327 Prepayments and accrued income 49 100 31 12 246 548 112 414 16 CURRENT ASSET INVESTMENTS Current asset investments comprise listed investments that are held for resale. At 31 March 2007 they had a fair value of Â£82,000 and a market value of Â£112,000 and the associated tax liability that would arise on their disposal was Â£nil. The fair value reflects the costs of disposal and the level of liquidity available in these shares at the balance sheet date. 17 CREDITORS - amounts falling due within one year Group Company 2007 2006 2007 2006 Â£'000 Â£'000 Â£'000 Â£'000 Trade creditors 113 71 67 46 Convertible loan notes 887 637 887 637 Deferred consideration - 250 - 250 Other taxes and social security 52 34 19 28 Other creditors 13 8 6 - Amounts owed to group - - 469 - Accruals and deferred income 214 98 89 79 1,279 1,098 1,537 1,040 Convertible loan notes are redeemable on the earlier of the date on which the Group has sufficient working capital to enable payment and 5 years from the date of issue, subject to the approval of the holders of the loan notes. The loan notes accrue interest at a fixed rate of 2% above bank base rate on the date of issue, payable upon redemption or conversion of the loan notes. The loan notes are convertible into ordinary shares at 3p per share at any time or before the 5th anniversary of issue provided the holders of the loan notes and their concert parties do not hold more than 29.99% of the entire issued share capital of the Company. The option to convert to ordinary shares is at the discretion of the holders of the loan notes. During the financial year the final two conditions were met for the payment of deferred consideration in relation to the acquisition of The Braemar Group Limited and accordingly payments have been made of Â£250,000 to two of the vendors, Marc Duschenes and his wife Jennie Duschenes in the form of convertible loan notes, the terms of which were set out in the admission document dated 10 November 2005. As recorded in note 26 two loan notes were redeemed on 10 April 2007 for a gross consideration of Â£406,000. 18 SHARE CAPITAL 2007 2006 Authorised Â£'000 Â£'000 200,000,000 (2006: 200,000,000) Ordinary shares of 1p each 2,000 2,000 Allotted, called up and fully paid 113,973,571 (2006: 113,795,000) Ordinary shares of 1p each 1,140 1,138 No of shares Issue price The following issues of ordinary shares of 1p took place in the year: 30 March 2007 178,571 2.8p 19 STATEMENT OF MOVEMENTS ON RESERVES Share premium Profit and account loss account Â£'000 Â£'000 Group 1 April 2006 1,959 (688) Loss for the period - (296) Arising on Shares issued during the period 3 - Share issue costs (5) - At 31 March 2007 1,957 (984) Company 1 April 2006 1,959 (618) Loss for the period - (665) Arising on Shares issued during the period 3 - Share issue costs (5) - At 31 March 2007 1,957 (1,283) 20 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS 2007 2006 Group Â£'000 Â£'000 Opening shareholders funds 2,409 70 Loss for the financial period (296) (301) Proceeds from the issues of shares - 2,640 Closing shareholders funds 2,113 2,409 2007 2006 Company Â£'000 Â£'000 Opening shareholders funds 2,479 70 Loss for the financial period (665) (231) Proceeds from the issues of shares - 2,640 Closing shareholders funds 1,814 2,479 21 ANALYSIS OF NET DEBT At 1 April Cash flows Non-cash At 31 March 2006 changes 2007 Cash Â£'000 Â£'000 Â£'000 Â£'000 Cash at bank and in hand 557 210 - 767 Debt Convertible loan notes (647) - (295) (942) Deferred consideration (250) - 250 - Net Debt (340) 210 (45) (175) 22 RECONCILIATION OF NET CASH FLOW TO MOVEMENT OF NET DEBT 2007 2006 Â£'000 Â£'000 Increase in cash 210 468 Non cash movement in net debt (45) (897) Movement in net debt during the year 165 (429) Opening net (debt)/ funds (340) 89 Closing net debt (175) (340) 23 FINANCIAL COMMITMENTS At 31 March 2007 the Group had annual commitments under non-cancellable operating leases as set out below. Land and Buildings 2007 2006 Operating leases which expire Â£'000 Â£'000 - within one year - - - within two to five years 26 26 - more than five years 6 6 32 32 24 CAPITAL COMMITMENTS AND CONTINGENT LIABILITIES The Group had no material capital commitments or contingent liabilities at 31 March 2007 (2006 - Â£Nil). 25 RELATED PARTY TRANSACTIONS The directors that served during the year, together with their interests in the ordinary 1p shares of the Company were as follows: At 31 March 2007 At 1 April 2006 (or date of appointment) Ordinary Shares of Ordinary Shares of 1p 1p each each M J Duschenes 21,254,999 19,434,999 W M Robinson 4,446,667 4,306,667 J S Murphy (appointed 13 June 2006) 1,043,028 666,667 A B S McFarland 2,500,000 2,500,000 D G Maclean (resigned 13 June 2006) - 10,140,000 D G Maclean had an interest by way of his beneficial interest in the entire issued share capital of Minlay Limited which held 10,140,000 shares. Anthony Basil Scott McFarland's interest is by way of his direct holding of 2,083,334 Ordinary Shares and his indirect holding of 416,666 Ordinary Shares by way of his beneficial interest in the share capital of JTM Holdings Limited. During the year Braemar Securities Limited, a wholly-owned subsidiary of Braemar Group plc, entered into a contract to provide corporate finance services to Regenesis Group plc (formerly Poly Information plc). Martin Robinson and Marc Duschenes are both non-executive directors of Regenesis Group plc. Under the terms of this contract payments have been received of Â£39,000 and Braemar Securities Limited has exercised an option under the contract to subscribe for 23,500,000 ordinary shares of 0.0025p in Regenesis Group plc. This shareholding represents a beneficial interest of 3.9% and has been valued at open market value at the financial year-end. There were no amounts outstanding at the year-end. The Group's wholly-owned subsidiaries, Coronation General Partner Limited, Coronation II General Partner Limited, Coronation III General Partner Limited and Coronation IV General Partner Limited have a nominal holding in, and managerial authority over certain aspects of the operation of, Coronation Limited Partnership, Coronation II Limited Partnership, Coronation III Limited Partnership and Coronation IV Limited Partnership. The value of transactions during the year and the amounts outstanding at the year-end are as follows: Coronation Coronation II Coronation III Coronation IV Limited Limited Partnership Limited Partnership Limited Partnership Partnership Â£'000 Â£'000 Â£'000 Â£'000 Sales: -services 60 97 222 156 -property disposal - - - 1,290 Amounts outstanding at 31/3/2007 11 9 4 - 26 POST BALANCE SHEET EVENTS In accordance with the terms of the loan notes issued as part of the consideration of the acquisition of The Braemar Group Limited, Marc Duschenes and Jennie Duschenes redeemed, on 10 April 2007, four convertible loan notes at par paid as deferred consideration. This resulted in Â£203,000 being paid to each of Marc Duschenes and Jennie Duschenes by the Group in cash. On 11 June 2007 the Group exchanged contracts on an agreement to acquire The Armchair Property Investor Limited ('Armchair') for an initial consideration of Â£190,000 payable upon completion, in Braemar shares and the assumption of Â£60,000 of debt in Armchair, and the remainder of the consideration (up to Â£2m) will become due under deferred consideration conditions linked directly to Armchair's profits over the next three years. Deferred consideration will be due partly in Braemar shares and partly by the issuance to Armchair's vendor, Frazer Fearnhead, of convertible loan notes. Completion is anticipated on 2 July 2007. 27 PENSIONS The Group provides pension arrangements to the majority of full-time employees through a defined contribution scheme. The pension charge for the year was Â£12,000 (2006 Â£nil). 28 FINANCIAL INSTRUMENTS The Group's financial instruments comprise borrowings, current and fixed asset investments and cash at bank and various items such as debtors and creditors that arise directly from its operations. The Group does not trade in financial instruments as a matter of policy. The principal borrowings relate to convertible loan notes, which are redeemable on the earlier of the date on which the Group has sufficient working capital to enable payment and 5 years from the date of issue, subject to the approval of the holders of the loan notes. The loan notes accrue interest at a fixed rate of 2% above bank base rate on the date of issue, payable upon redemption or conversion of the loan notes. The loan notes are convertible into ordinary shares at 3p per share at any time or before the 5th anniversary of issue provided the holders of the loan notes and their concert parties do not hold more than 29.99% of the entire issued share capital of the Company. The option to convert to ordinary shares is at the discretion of the holders of the loan notes. Interest due on these notes is accrued and paid on redemption or conversion. The value of the loan notes including accrued interest outstanding, which are all at a fixed rate, at the year-end was Â£943,000 (2006 Â£648,000). The cash at bank and in hand at the year-end was Â£767,000 (2006 Â£557,000), which was all held in variable interest bearing accounts linked to bank base rate. During the year the Group entered into an option agreement pursuant to the provision of corporate finance services that allowed for the subscription of shares at a pre-agreed price. This option has now been exercised and the shares are recognised as a current asset investment. These shares are quoted on AIM. It is not the Company's policy to trade in quoted shares. There are no other derivatives outstanding at the year-end. The Group's fixed asset investments represent nominal stakes in unlisted limited partnerships formed for the purposes of investment in residential property. These are not traded and are intended to be held until the maturity of the investment, which is in more than five years. The main future risk relates to interest rate risk as the Group currently benefits from significant surplus cash available for short-term investment. There is no currency risk as the Group trades only in Sterling. Operations to date have been financed through a placing of shares and borrowings. The Group has taken advantage of the exemption in Financial Reporting Standard 13 in respect of short-term debtors and creditors. The fair value of the Group's financial instruments is deemed to be equal to the book value. Notes The financial information set out in this announcement does not constitute the company's statutory financial statements for the periods ended 31 March 2007 and 2006. The financial information for 2006 is derived from the statutory accounts for 2006 which have been delivered to the Registrar of Companies. The auditors have reported on the 2007 and 2006 statutory accounts: their reports were unqualified and did not contain a statement under section 237 of the Companies Act 1985. The statutory accounts for 2007 will be delivered to the Registrar of Companies in due course Copies of the Audited Accounts for the Year to 31 March 2007 and a notice of the AGM will be posted to shareholders in June 2007. For further information please contact: Marc Duschenes, Chief Executive, Braemar Group plc 0161 929 4969 Alex Clarkson, Zeus Capital Limited 0161 831 1512 END This information is provided by RNS The company news service from the London Stock Exchange

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