Interim Results

Sutton Harbour Holdings PLC 30 November 2001 30th November 2001 THE FUTURE IS BRIGHT FOR SUTTON AS PROFITS CONTINUE TO RISE Sutton Harbour Holdings Plc, the Aim listed operators of Plymouth's historic harbour and Plymouth City Airport reports increased interim profits for the period ended 30th September 2001 * Core Pre Tax Profits up 5% to £681,000 * Adjusted Earnings per share up 5% to 4.78p * Interim Dividend up 6% to 1.7p * Fishing and related businesses performing well. * Strong results from Airport operations. 'We are continuing to make good progress. We are determined to use our financial strength to take advantage of any slowdown that may occur in the economy and we remain convinced of our bright prospects.' Ellen Winser, Chairman, Sutton Harbour Holdings.Plc Contacts: Duncan Godefroy, Managing Director 01752 204186 Nigel Godefroy, Finance Director 01752 204186 Ken Rees, Winningtons 0117 317 9477 or mobile 07802 466567 CHAIRMAN'S INTERIM STATEMENT Last year we acquired Plymouth City Airport and faced the challenge of integrating it with the rest of our group. During the last six months we have spent much time seeking to enhance the potential of the airport and the Sutton Partnership. We have also continued to make progress as our results demonstrate. In my statement accompanying the full year's results, I explained that the contribution from our Sutton Partnership is likely to become more significant in the years ahead but profits from this source are inevitably going to be uneven in both their arrival and in their amount. Excluding Sutton Partnership property items, pre-tax profit at £681,000 is up 5%, despite a small drop in turnover. As we indicated in the full year's report and accounts, Financial Reporting Standard 19, Deferred Tax, will apply to us in our current year. As a result, we now have to allow for taxation deferred mainly by the excess of capital allowances over depreciation despite the fact that we do not anticipate disposing of any of the assets on which the capital allowances have been claimed. Without this provision, and excluding the property items, earnings per share at 4.78p are also up by 5%. In addition, we are required to provide for deferred taxation in respect of prior years, which previously we had disclosed by way of a note and we have therefore had to reduce the balance sheet total by the relevant amount. Your board has decided to declare an interim dividend of 1.7p per share, 6% more than the equivalent payment a year ago, which will be paid on 11 January 2002 to shareholders on the register at 14 December 2001. The shares will be marked ex-dividend on 12 December 2001. Passenger volumes at both Plymouth City Airport and Newquay Cornwall Airport have remained buoyant throughout the period. The good results from our airport operations reflect these higher volumes and the effects of the reorganisation that we initiated last year. It seems likely that passenger throughput will remain fairly robust so long as the train services in our region remain unreliable. However, we have seen some slackening off in passenger growth for October at both Plymouth and Newquay, probably reflecting the events of 11 September. In addition, insurance costs have risen sharply and our ability to pass these on is fairly limited. What is not clear at this stage is how long the effects of the atrocity in New York will last. The improvement in fishing has continued with greater volumes of fish, firmer prices and good fuel sales, though as ever, fuel margins remain tight. The marina is full as usual and demand from summer visitors was good. Our marine leisure businesses have been less successful, though profitability on a lower turnover is higher, and we have put the Torbay Boating Centre up for sale. We originally bought this business to protect various franchises but the way in which these are handled has changed so the need to own this outlet has diminished. The boatyard has a full order book and continues to make a satisfactory contribution to the group's results. Income from property is lower than a year ago because we no longer have the rental income from Clare Place, which we sold last year. On the other hand, various rent reviews are due and we are in negotiation with the relevant tenants. We expect to secure increases before our year end. Negotiations for the development of the Moon Street site have continued and seemed all but finalised at the beginning of September. Since the 11th of that month, the potential developer's enthusiasm is undiminished, but he is finding finance for the project more difficult to secure. We remain convinced that the potential for us from this site is considerable but acknowledge that bringing it to completion is likely to take longer than we had originally hoped. We have also been working on development plans for other sites in and around the harbour which together have very significant potential for us in the next two years or so. During the period we at last received Inland Revenue approval for our Save as You Earn Share Scheme and I am delighted to say that over 30% of our staff took advantage of options granted on 5 October 2001. If they all take up the shares to which they are entitled we will issue a total of 128,872 new shares at 136p each during the course of the next seven years starting three years from now. On 1 November Duncan Godefroy relinquished the role of Company Secretary though he continues, of course, as Managing Director. Natasha Gadsdon, aged 31, a Chartered Accountant who has been with the company for five years and who has been assistant Company Secretary for the last eighteen months, is now Company Secretary. There is no doubt that the events of 11 September have created a more challenging environment for certain elements of our business but these more uncertain times also provide us with opportunities. Our Balance Sheet remains extremely strong, with gearing at a modest 13%. We are determined to use our financial strength to take advantage of any slowdown that may yet occur and we remain convinced of our bright prospects and potential. The interim report was approved by the Board of Directors on 28th November 2001. Ellen Winser Chairman CONSOLIDATED SUMMARISED PROFIT AND LOSS ACCOUNT Note 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 (unaudited) (unaudited) (audited) £000 £000 £000 ____________ ___________ __________ Turnover Continuing Operations 4,228 3,164 5,129 Acquisition - 1,815 3,562 ____________ ___________ __________ 2 4,228 4,979 8,691 ____________ ___________ __________ Operating Profit Continuing Operations 752 842 1,325 Acquisition - 203 413 ____________ ___________ __________ 2 752 1,045 1,738 Profit on Sale of Fixed - - 66 Asset Investment Properties Net Interest 7 (71) (114) (227) ____________ ___________ __________ Profit on Ordinary £681 £931 £1,577 Activities Before Taxation Taxation on Profit 3 (100) (150) (200) on Ordinary Activities Deferred Taxation Provided 3 (105) - - ____________ ___________ __________ Profit on Ordinary 476 781 1,377 Activities After Taxation Dividends 4 (206) (194) (547) ____________ ___________ __________ Retained Profit £270 £587 £830 =========== ========== ========= Earnings per 5 3.92p 6.55p 11.44p Share Adjusted Earnings 5 4.78p 4.57p 8.56p per Share Dividend per Share 4 1.7p 1.6p 4.5p CONSOLIDATED SUMMARISED BALANCE SHEET As at As at As at 30 September 30 September 31 March 2001 2000 2001 (unaudited) (unaudited) (audited) £000 £000 £000 ________________ _________ ___________ Fixed Assets £26,422 £26,545 £26,252 =============== ======== ========== Current Assets Stock 693 652 774 Debtors (due within one 2,383 1,992 2,099 year) Cash at Bank and in Hand 4 4 4 _________________ _________ ___________ 3,080 2,648 2,877 _________________ _________ ___________ Creditors (due within one year) Bank Overdraft 2,924 3,513 2,471 Other 2,590 2,254 3,019 ________________ _________ ___________ 5,514 5,767 5,490 ________________ _________ ___________ (2,434) (3,119) (2,613) Net Current Liabilities Total Assets less Net Current Liabilities 23,988 23,426 23,639 ________________ _________ ___________ Deferred Income (due after more than one (144) (199) (170) year) Provisions for Liabilities and Charges Deferred Taxation (1,010) - - ________________ _________ ___________ Net Assets £22,834 £23,227 £23,469 =============== ======== ========== Shareholders' Funds £22,834 £23,227 £23,469 STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 (unaudited) (unaudited) (audited) £000 £000 £000 ________________ _________ ___________ Profit for the Period 270 587 830 Prior Year Adjustment Deferred Taxation provided (905) - - ________________ _________ ___________ Total Gains and Losses since the last Financial (£635) £587 £830 Statement ============== ======== ========== CONSOLIDATED SUMMARISED CASH FLOW STATEMENT 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 (unaudited) (unaudited) (audited) £000 £000 £000 ____________ ___________ ___________ Reconciliation of Operating Profit to Net Cash Inflow from Operating Activities Operating Profit 752 1,045 1,738 Depreciation Charges 74 82 161 Profit on Sale of 130 Vauxhall Street - (281) - Profit on Sale of Fixed Assets - (1) - Amortisation of Grants (7) (8) (16) Amortisation of Intangible Fixed Assets - 2 32 Transfer to Stock of Development - - 299 Property Decrease/(Increase) in Stock 80 18 (59) (Increase) in Debtors (283) (926) (529) (Decrease)/Increase in Creditors (401) 288 282 ___________ ___________ ___________ Net Cash Inflow from Operating Activities £215 £219 £1,908 ___________ ___________ ___________ CASH FLOW STATEMENT Net Cash Inflow from 215 219 1,908 Operating Activities Returns on Investment and Servicing (81) (128) (249) of Finance Capital (Expenditure)/Receipts (235) 359 33 Acquisitions - 241 241 Dividends Paid (352) (260) (454) Financing - (189) (195) ___________ ___________ ___________ (Decrease)/Increase in Cash (£453) £242 £1,284 in the Period ___________ ___________ ___________ Reconciliation of Net Cash Flow to Movement in Net Debt (Decrease)/Increase in Cash (453) 242 1,284 in the Period Net Debt Brought Forward (£2,467) (£3,751) (£3,751) ____________ ___________ ___________ Net Debt Carried Forward (£2,920) (£3,509) (£2,467) ___________ ___________ ___________ RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS Note 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 (unaudited) (unaudited) (audited) £000 £000 £000 ___________ ___________ ____________ Reported Profit in Group 476 781 1,377 Companies for the Period Dividends 4 (206) (194) (547) ___________ ___________ ____________ Retained Profit for the Period 270 587 830 Nominal value of shares issued - 542 542 Premium on Issue of Shares - 2,058 2,058 Expenses in connection with Share Issue - (83) (84) Deferred Taxation provided (905) - - Opening Shareholders' funds 23,469 20,123 20,123 ___________ ___________ ____________ Closing Shareholders' funds £22,834 £23,227 £23,469 ========== ========== =========== NOTES TO INTERIM REPORT 1. Accounting Basis The Accounts are prepared under the historical cost convention modified to include the revaluation of certain freehold properties and investments. The Accounts are prepared in accordance with applicable accounting standards except where, in the opinion of the Directors, departure is necessary in order to show a true and fair view. The Accounting Policies are consistent with those applied in the Annual Report and Accounts for the year ended 31 March 2001. The interim financial statements are not audited. 2. Segmental Analysis 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 £000 £000 £000 ____________ _____________ ___________ Turnover Fisheries Related 1,059 1,124 2,113 Marine Leisure 758 1,042 1,599 Property 409 418 837 Sale of 130 Vauxhall Street - 580 580 Airport Operations 2,002 1,815 3,562 ___________ _____________ __________ £4,228 £4,979 £8,691 ____________ _____________ ___________ Operating Costs Fisheries Related 794 892 1,557 Marine Leisure 552 792 1,245 Property 117 108 217 Cost of Sale of 130 Vauxhall Street - 299 299 Airport Operations 1,746 1,612 3,149 Administration 267 231 486 ____________ _____________ ___________ £3,476 £3,934 £6,953 ____________ _____________ ___________ Operating Profit £752 £1,045 £1,738 =========== ============ ========== 3. Taxation The Corporation Tax charge represents the provision for taxation on the taxable profits for the period. 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 £000 £000 £000 ____________ _____________ ___________ Corporation Taxation 100 150 200 Deferred Taxation Provided 105 - - ____________ _____________ ___________ £205 £150 £200 =========== ============ ========== Financial Reported Standard 19, Deferred Tax, was issued during the year This requires a full provision to be made for deferred taxation. The standard is applicable for financial statements relating to accounting periods ending on or after 23 January 2002. The amount provided at 30 September 2001 is approximately half of the full year's estimated provision to 31 March 2002. NOTES TO INTERIM REPORT Historically we have not provided for deferred taxation in the accounts on the grounds that the gains that would arise on the disposal of assets would not crystallise. The amount of deferred taxation previously disclosed by way of a note in the accounts, but unprovided, has now been charged to the retained profits as required by FRS 19. It will remain a provision in the Balance Sheet until the taxation on gains crystallises and becomes payable. £000 Deferred Taxation unprovided at 31 March 2001 1,584 Less Rolled Over Capital Gains (679) _____ £905 ==== 4. Dividends 6 months to 6 months to 12 months to 30 September 30 September 31 March 2001 2000 2001 £000 £000 £000 ____________ _____________ ____________ Ordinary Shares Interim dividend of 1.7p per share payable (2000:1.6p) 206 194 194 Ordinary Shares Final dividend of 2.9p per Share - - 353 ____________ _____________ ____________ £206 £194 £547 =========== ============ =========== The interim ordinary dividend will be paid on 11 January 2002 to Shareholders on the register on 14 December 2001. 5. Earnings per Share Earnings per Share have been calculated by reference to 12,146,515 ordinary shares in issue with the exception of the 6 month period ended 30 September 2000 and the year ended 31 March 2001 where the weighted average number of shares in the issue during that period has been applied. The calculation of Earnings per Share is based on the following: 6 months to 6 months to Year Ended 30 September 30 September 31 March 2001 2000 2001 ______________ ____________ ___________ Earnings per Share Profit for the period attributable to Shareholders (£000) £476 £781 £1,377 Weighted number of Shares (000s) 12,147 11,927 12,036 ______________ ____________ ___________ Earnings per Share 3.92p 6.55p 11.44p ============= =========== ========== Adjusted Earnings per Share Profit for the period attributable to Shareholders excluding net profit on sale of properties and excluding the Deferred Taxation provided (£000) £581 £545 £1,030 Weighted number of Shares (000s) 12,147 11,927 12,036 ______________ ____________ ___________ Adjusted Earnings per Share 4.78p 4.57p 8.56p ============= =========== ========== 6. Publication of Non-Statutory Accounts The financial information set out in this report does not constitute statutory accounts as defined in section 240 of the Companies Act 1985. The figures for the year ended 31 March 2001 have been extracted from the statutory financial statements which have been filed with the Registrar of Companies. The auditors' report on those financial statements was unqualified and did not contain a statement under Section 237(2) of the Companies Act 1985. 7. Interest Interest payable in the 6 months to 30 September 2001 is stated after capitalisation of £9,000 (2000: £11,000) Copies of this report are available to members of the general public from the company's registered office: Sutton Harbour Holdings plc, North Quay House, Sutton Harbour, Plymouth PL4 0RA.

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