Half Yearly Report

RNS Number : 7415F

Safeland PLC

16 November 2015

 



Safeland plc ("Safeland" or the "Company")

UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2015

Highlights

Turnover: £12.5m (2014: £7.8m), up 61.1%

Profit before tax: £4.3m (2014: £2.2m), up 95.4%

Interim dividend: 1.5p (2014: 0p)

Total shareholder return: 19.5% (2014: 127.60%)Net asset value per share: 106.0p (2014: 63.8p, 31 March 2015 87.0p), an increase of 21.8% since 31 March 2015

Managing Director's Statement

I am delighted to report a strong six months to 30 September 2015. Safeland has generated a significant increase in both turnover and profit. This period has been positively impacted by the completion of a number of developments, including two phases of the Wimbledon development, the last phases of which are due for completion in the second half of the year. Shareholders should be aware that this is to some extent a function of timing of completions of projects and does not necessarily reflect potential second half performance.

The Board continues to focus on maximising the value of stock held, through obtaining planning consents and then developing the properties for onward sale.

During the period, the Company participated in a placing of shares by Safestay plc, acquiring 1,070,864 shares in Safestay at a cost of £663,935, bringing its total holding to 1,420,864, representing  4.3% of Safestay's issued share capital.

On 25 September 2015, the Company paid a final dividend of 1.75p per share for the year ended 31 March 2015. I am pleased to announce that the Board has declared an interim dividend for the six months ended 30 September 2015 of 1.5p per share payable on 18 December 2015 to shareholders on the register on 27 November 2015.

Outlook

The property market is at extremely high levels, with conflicting signs. On the one hand record prices are being achieved, whilst there are also signs of strong resistance to these levels in certain sectors, leading to pockets of stagnation. It is difficult to anticipate the true substance of the underlying strength of the market, and whilst the Board is confident it has the skills necessary to continue to make opportunistic acquisitions in any market, its current approach is to be very selective in what may prove to be too aggressive an environment.

Larry Lipman

Managing Director

Contacts:

Safeland Plc                                       020 8815 1600

Larry Lipman, Managing Director:

Westhouse Securities Limited   020 7601 6100

Tom Griffiths

Condensed consolidated income statement	Unaudited Six months	Unaudited Six months		Audited Year
	ended	ended		ended
	30 September	30 September		31 March
	2015	2014		2015
	£000	£000		£000
Revenue	12,453	7,763		10,256
Cost of sales	(7,497)	(5,315)		(7,495)
Gross profit	4,956	2,448		2,761
Administrative expenses	(802)	(588)		(1,570)
Gain on revaluation of investment properties	-	225		225
Share of results of jointly controlled entity	-	11		11
Share of results of associate	12	25		29
Profit on sale of investment in joint venture	-	209		209
Dividend from investment	13	-		11
Profit on sale of investment property	-	124		5,272
Operating profit	4,179	2,454		6,948
Finance income	256	1		167
Finance costs	(156)	(224)		(403)
Profit before tax	4,279	2,231		6,712
Tax	(866)	(351)		(979)
Profit for the financial period attributable to owners of the parent company	3,413	1,880		5,733
Basic earnings per share (note 2)	20.24p		11.15p		34.02p
Diluted earnings per share (note 2)	13.35p		5.12p		15.62p

Condensed consolidated statement of comprehensive income	Unaudited Six months	Unaudited Six months	Audited Year
	ended	ended	ended
	30 September	30 September	31 March
	2015	2014	2015
	£000	£000	£000
Profit for the period	3,413	1,880	5,733
Other comprehensive income Fair value (losses)/gains on available for sale financial assets	(74)	-	82
Other comprehensive income for the year, net of tax	(74)	-	82
Total comprehensive income for the period attributable to owners of the parent company	3,339	1,880	5,815

Condensed consolidated statement of financial position	Unaudited 30 September	Unaudited 30 September	Audited 31 March
	2015	2014	2015
	£000	£000	£000
Non-current assets
Property plant and equipment	1,935	170	1,981
Investment properties (note 5)	723	5,448	723
Investments in associate	135	151	123
Available-for-sale investments	897	225	307
Trade and other receivables	8,240	-	7,985
	11,930	5,994	11,119
Current assets
Trading properties (note 6)	11,654	13,098	14,718
Trade and other receivables	660	362	364
Cash and cash equivalents	2,865	2,865	454
	15,179	16,325	15,536
Total assets	27,109	22,319	26,655
Current liabilities
Bank loans and overdrafts (note 7)	-	9,500	1,258
Trade and other payables	1,124	1,287	1,762
Derivative financial instruments	-	3	-
Corporation tax payable	1,733	-	1,696
	2,857	10,790	4,716
Non-current liabilities
Bank loans (note 7)	6,385	-	7,185
Deferred income tax liabilities	-	778	-
	6,385	778	7,185
Total liabilities	9,242	11,568	11,901
Net assets	17,867	10,751	14,754
Equity
Share capital	843	843	843
Share-based payment reserve	555	417	486
Investment revaluation reserve	13	5	87
Retained earnings	16,456	9,486	13,338
Total equity attributable to owners of the parent company	17,867	10,751	14,754

Condensed consolidated statement of cash flows	Unaudited Six months	Unaudited Six months	Audited Year
	Ended	ended	ended
	30 September	30 September	31 March
	2015	2014	2015
	£000	£000	£000
Cash flows from operating activities
Cash generated/(utilised) from operations (note 4)	6,429	946	(2,376)
Interest paid	(156)	(225)	(403)
Corporation tax paid	(829)	-	(132)
Net cash generated/(utilised) from operating activities	5,444	721	(2,911)
Cash flows from investing activities
Cash flows from investing activities	-	1	1
Distributions from associate	-	-	32
Dividend paid	(295)	-	-
Purchase of property, plant and equipment	(98)	(88)	(2,003)
Purchase of available for sale investments	(664)	(175)	(175)
Proceeds from sale of investment property	-	244	4,230
Proceeds from sale of property, plant and equipment	82	59	119
Net cash inflow/(outflow) from investing activities	(975)	41	2,204
Cash flows from financing activities
New loans	-	6,400	9,258
Loan repayments	(2,058)	(5,300)	(9,100)
Net cash inflow from financing activities	(2,058)	1,100	158
Net increase/(decrease) in cash and cash equivalents	2,411	1,862	(549)
Cash and cash equivalents at beginning of period	454	1,003	1,003
Cash and cash equivalents at end of period	2,865	2,865	454

Condensed consolidated statement of changes in equity	Share capital	Share-based payment reserve	Investment revaluation reserve	Retained earnings	Total equity
	£000	£000	£000	£000	£000
Balance at 1 April 2015	843	486	87	13,338	14,754
Comprehensive income
Profit for the six months period to 30 September 2015	-	-	-	3,413	3,413
Revaluation of available-for-sale investments	-	-	(74)	-	(74)
Total comprehensive income	-	-	(74)	3,413	3339
Transactions with owners recognised directly in equity
Dividends	-	-	-	(295)	(295)
Share-based payment charge for the period	-	69	-	-	69
	-	69	-	(295)	(226)
Balance at 30 September 2015	843	555	13	16,456	17,867

	Share	Share-based	Investment	Retained	Total
Condensed consolidated statement of changes in	capital	Payment	revaluation	Earnings	Equity
equity		Reserve	reserve
	£000	£000	£000	£000	£000
Balance at 1 April 2014	843	348	5	9,414	10,610
Comprehensive income
Profit for the six months period to 30 September 2014	-	-	-	1,880	1,880
Total comprehensive income	-	-	-	1,880	1,880
Transactions with owners recognised directly in equity
Dividends	-	-	-	(1,808)	(1,808)
Share-based payment charge for the period	-	69	-	-	69
	-	69	-	(1,808)	(1,739)
Balance at 30 September 2014	843	417	5	9,486	10,751

	Share	Share-based	Investment	Retained	Total
Condensed consolidated statement of changes in	capital	Payment	revaluation	earnings	Equity
Equity		Reserve	reserve
	£000	£000	£000	£000	£000
Balance at 1 April 2014	843	348	5	9,414	10,610
Comprehensive income
Revaluation of available-for-sale investments	-	-	82	-	82
Profit for the year to 31 March 2014	-	-	-	5,733	5,733
Total comprehensive income	-	-	82	5,733	5,815
Transactions with owners recognised directly in equity
Dividends	-	-	-	(1,809)	(1,809)
Share-based payment charge for the year	-	138	-	-	138
	-	138	-	(1,809)	(1,671)
Balance at 31 March 2014	843	486	87	13,338	14,754

1.      Basis of preparation and accounting policies

The condensed interim consolidated financial statements of the Company and its subsidiaries ("the Group") for the six months ended 30 September 2015 ("the period") have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs) as adopted by the European Union. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest audited financial statements for the year ended 31 March 2015. This half year statement does not constitute full accounts as defined by Section 434 of the Companies Act 2006

These condensed interim financial statements have not been audited, do not include all of the information required for full annual financial statements, and should be read in conjunction with the Group's consolidated annual financial statements for the year ended 31 March 2015.

2.      Earnings per share

	Unaudited Six months		Unaudited Six months		Audited Year
	ended		Ended		ended
	30 September		30 September		31 March
	2015		2014		2015
	£000	£000		£000
Profit for the financial period attributable to owners of the parent company	3,413	1,880		5,733
	No	No		No
	000	000		000
Weighted average number of ordinary shares for
the purposes of basic earnings per share	16,851	16,851		16,851
Effect of potential dilutive ordinary shares:
share options	19,865	19,865		19,865
Weighted average number of ordinary shares for the purposes of diluted earnings per share	36,716	36,716		36,716

Diluted Earnings per share is calculated by adjusting the earnings and number of shares for the effects of dilutive options and other dilutive potential ordinary shares.  

3.      Dividends

In the six months ended 30 September 2015, the Company paid a final dividend of 1.75p per ordinary share.

4.      Cash flows from operating activities

	Unaudited Six months	Unaudited Six months	Audited Year
	Ended	ended	ended
	30 September	30 September	31 March
	2015	2014	2015
	£000	£000	£000
Profit before tax	4,279	2,231	6,712
Depreciation	48	25	62
Profit/(loss) on sale of property, plant and equipment	14	(15)	(9)
Gain on revaluation of investment properties	-	(225)	(225)
Profit on sale of investment in joint venture	-	(209)	(209)
Profit on sale of investment property	-	(124)	(5,272)
Share of results of associate	(12)	(25)	(30)
Share of results of jointly controlled entity	-	(11)	(11)
Finance income	-	(1)	(1)
Unwinding of discount on deferred revenue	(256)	-	(166)
Finance costs	156	218	403
Share-based payments charge	69	69	138
Changes in working capital
(Decrease)/increase in trading properties	3,064	(615)	(2,235)
(Increase)/decrease in trade and other receivables	(296)	258	(1,706)
(Decrease)/increase in trade and other payables	(637)	(630)	173
	6,429	946	(2,376)

5.     Investment properties
	Unaudited Six months	Unaudited Six months			Audited Year
	ended	ended			ended
	30 September		30 September	31 March
	2015		2014	2015
	£000		£000	£000
Fair value
Start of the period	723		5,343	5,343
Disposals	-		(120)	(4,845)
Increase in fair value during the period	-		225 -	225
End of period	723		5,448	723

The fair value of the investment properties at 30 September 2015 comprises freehold properties of £265,000 (30 September 2014: £4,990,000 and 31 March 2015: £265,000) and long leasehold properties of £458,000 (30 September 2014: £458,000 and 31 March 2014: £458,000).

The directors do not consider the fair value of the Group's lease obligations associated with its long leasehold investment properties to be material to the financial statements. As a result, no finance lease obligations are included in the statement of financial position at 30 September 2015, 30 September 2014 or 31 March 2015.

The Group has pledged investment properties for resale with carrying value of £703,000 (30 September 2014: £5,448,000 and 31 March 2015: £703,000).

6.      Trading properties                         

	Unaudited Six months	Unaudited Six months			Audited Year
	ended	ended			ended
	30 September		30 September	31 March
	2015		2014	2015
	£000		£000	£000
Properties for resale	11,654		13,098	14,718

The Group has pledged trading properties for resale with carrying value of £9,406,000 (30 September 2014: £11,169,000 and 31 March 2015: £12,747,000) to secure banking facilities granted to the Group.

7.     Bank loans and overdrafts
	Unaudited Six months	Unaudited Six months			Audited Year
	ended	ended			ended
	30 September		30 September	31 March
	2015		2014	2015
	£000		£000	£000
Bank loans
Due within one year	-		9,500	1,258
Due in the second to fifth years	6,500		-	7,300
Unamortised borrowing costs	(115)		-	(150)
	6,385		-	7,185

There were no breaches in bank loan covenants as at 30 September 2015, 30 September 2014 or 31 March 2015.  All of the Group's bank loans and overdrafts disclosed above comprise borrowings in sterling. The bank loans are secured on properties owned by the Group.

8.         Copies of this announcement are available on the Company's website www.safeland.co.uk.

 

END

 

 

IR BJBFTMBJBBLA