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Benchmark Group PLC (BMK)

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Monday 20 September, 1999

Benchmark Group PLC

Final Results - Part 2

BENCHMARK GROUP PLC 
20 September 1999


Part 2

FINANCIAL REVIEW

OPERATING RESULTS

We  made an after tax profit of £13.2 million for the year  to  30
June 1999 compared with £15.4 million in 1998, a drop of 14%.  Net
rental  income  for the year was £19.5 million compared  to  £21.5
million  in  the previous year.  The reduction in  the  after  tax
profit in the financial year can be attributed to the following: -

(i)  A   reduced  profit  achieved  on  the  sale  of  trading  and
     investment  properties  -  £4.09  million  compared  to   £7.0
     million  in the previous year.  These profits arise  from  the
     sale  of  both trading and investment properties and  for  the
     latter,  the  historical cost profit  is  a  more  appropriate
     performance   measurement  for  year   to   year   comparative
     purposes.  On an historical cost profit comparison basis,  the
     profits  achieved in 1999 were £10.5 million compared to  £8.2
     million  in 1998 as sales of investment properties  were  much
     higher in 1999 (£48.1 million sales proceeds compared to  £3.3
     million in 1998).
    
(ii) An  increase  in irrecoverable property costs  of  £1.0m,  the
     bulk of which is agency fees paid on new lettings.

(iii)A  reduction  of  £0.6m in gross rental  income  due  to
     disposals and rent-free periods given on new lettings.

Earnings  per share dropped from 13.0p per share to 10.9p  but  if
net  profits on disposal of trading and investment properties  are
excluded, the reduction is only 7% (from 8.8p per share to 8.2p).

OVERHEADS

Total overheads for the year amounted to £3.3 million (1998 - £2.5
million) and this included Nexus' overheads of £99,000.  Excluding
this  amount,  it represents 16.6% of net rental  income  (1998  -
11.8%).  Due to the large development programme in progress during
the  year,  no  income was generated from the developments,  which
included Stirling Square and The Panoramic.

FINANCE

The  Group  finances  its  operations  by  a  mixture  of  equity,
convertible  bonds and bank borrowings.  The Group's objective  is
to   maintain   sufficient  resources  to   meet   its   financing
requirements  at  the  lowest achievable cost  and  minimal  risk,
whilst maintaining sufficient flexibility to meet the requirements
of  property  purchases, sales and developments.   No  speculative
treasury transactions are undertaken.

At the year end, net borrowings amounted to £175.9 million (1998 -
£165.8  million) representing a gearing of 54% (1998 - 57%).   The
borrowings  include  £49.2  million  (net  of  costs)   of   5.75%
Convertible Unsecured Loan Stock 2013, £95.6 million from  Midland
Bank  and  £28.1  million from Rheinhyp.  The  Midland  Bank  loan
expires in June 2004 whilst that from Rheinhyp expires in February
2007.

We  continue  to have a self-imposed Group gearing level  of  100%
which  is  periodically reviewed by the Board taking into  account
prevailing and future market conditions.

The £50 million 2013 Convertible Unsecured Loan Stock issue during
the  year served to increase the proportion of fixed interest rate
and  at  the year end, 74% of the total borrowings were  at  fixed
interest  rates.  Our weighted average cost of funds is  currently
at  6.8% per annum.  We will continuously monitor the situation to
ensure  that  we  are not affected materially by adverse  interest
rate movements in the near future.

TAXATION

The  taxation  charge  of  £1.97 million  (1998  -  £4.3  million)
represents 13.0% of our pre-tax profits (1998 - 21.8%).   The  low
tax  charge is a consequence of capital allowances claimed and the
utilisation of brought forward losses.

REVALUATION OF INVESTMENT PORTFOLIO/NET ASSETS PER SHARE

The  investment  portfolio was revalued  by  DTZ  Debenham  Thorpe
Chartered  Surveyors at the year end and based on  those  figures,
there  is  a  revaluation surplus of £24.1 million (1998  -  £49.9
million)  and  this  represents a 5.1% uplift  on  the  investment
properties  held as at the year end (1998 - 13.5%).   However,  if
the  development properties, which are held at cost, are excluded,
the uplift is 6.9%.

Correspondingly,  the  net assets per share  have  increased  from
243.4 pence as at 30 June 1998 to 270.5 pence at the year end,  an
increase of 11.1% (1998 - 28.6%).

MANAGEMENT

During  the year we have added 1 professional member of  staff  to
the head office team giving a total staff of 20.

YEAR 2000 ISSUES

The  Board and management rigorously continue to monitor the  year
2000  compliance programme, to ensure that problems are identified
and  corrected,  and  that the business of the  Company  continues
without interruption as we enter 2000.

The  potential  risks to the Company have been assessed  as  being
with  the  systems within the properties for which  the  Group  is
responsible,  and  with  our own internal computer  systems.   The
action taken to address these risks is as follows: -

* The  team  of independent consultants we appointed has completed
  their  inspections,  assessment and categorisation  of  all  the
  critical items of plant throughout our property portfolio.   The
  replacement of any such non-compliant systems is expected to  be
  completed  by  early  October.  The cost  of  the  programme  is
  unlikely to exceed £75,000.

* We  have  advised those of our tenants, who occupy buildings  on
  full  repairing terms, of the problems that could occur and have
  requested   their   confirmation  of  the  measures   they   are
  undertaking to deal with any potential problems.

* The   testing   of  our  internal  computer-systems   has   been
  undertaken, and these systems have been confirmed as  year  2000
  compliant.

* To   prevent   unexpected  problems  arising  on  new   property
  acquisitions,  we  are seeking appropriate assurances  from  the
  vendors at the time of purchase.

* There  can  be no absolute assurances that the steps taken  will
  eliminate  all  problems associated with the  year  change.   We
  have,  therefore, developed contingency plans the  turn  of  the
  year,  so  that  we can speedily resolve problems  and  minimise
  inconvenience should any problems arise.

3 YEAR REVIEW

Since  the recapitalisation of Benchmark in October 1996,  it  has
undergone  rapid transformation into a specialist  Central  London
property  company.  It is helpful to look back at the achievements
over  the  three  year  period in terms of property  acquisitions,
disposals and capital expenditure.

                    1996/97    1997/98    1998/99   Post year end    Total
Acquisitions         176.9      222.0      35.3         81.5         515.7
Disposals              -        49.0       85.9         63.0         197.9
Capital                                                                
  Expenditure         2.4       31.4       63.8         10.4         108.0

During  this period, a total gross area of 680,000 sq ft has  been
or is being refurbished or redeveloped.

As  Benchmark is primarily a property investment company, one  key
performance  indicator  is the net asset  value  (NAV)  per  share
growth.

                                            Year Ended
                       30 June 1996  30 June 1997  30 June 1998  30 June 1999
NAV per share, p              168.1         189.3         243.3         270.5

During this period, the annual compound growth in NAV per share is
17.2%  per annum and by including the dividend per share that  has
been paid out, the growth is 18.6%.




               CONSOLIDATED PROFIT AND LOSS ACCOUNT
                      Year ended 30 June 1999
                                 
                                                         1999           1998
                                       Note             £'000          £'000
                                                                            
Gross rental income                                    23,221         23,787
Ground rents                                          (1,361)        (1,192)
Irrecoverable property costs                          (1,967)          (941)
Amortisation of leasehold property                      (390)          (120)
                                                       ______         ______
Net rental income                                      19,503         21,534
                                                                            
Profit on disposal of trading                                               
  properties                             1              2,491          6,615
Administration expenses                               (3,346)        (2,538)
                                                       ______         ______
                                                                            
Operating profit                                       18,648         25,611
                                                                            
Profit on disposal of investment                                            
  properties                             1              1,603            387
Profit on termination of                                                    
  discontinued  operations                                  -             40
                                                       ______         ______
Profit on ordinary activities                                               
  before interest                                      20,251         26,038
Interest receivable                      2                345            548
Interest payable and similar                                                
  charges                                3            (5,458)        (6,892)
                                                       ______         ______
Profit on ordinary activities                                               
  before taxation                                      15,138         19,694
Taxation                                 4            (1,974)        (4,298)
                                                       ______         ______
Profit on ordinary activities                                               
  after taxation                                       13,164         15,396
Dividends                                5            (4,521)        (4,219)
                                                       ______         ______
Retained profit for the year                            8,643         11,177
                                                        =====          =====
Earnings per share on                                                       
  operating activities excluding                                            
   net profits on disposal of trading                                       
    and investment properties            6               8.2p           8.8p
                                                        =====          =====
Earnings per share                                                          
- basic and diluted                      6              10.9p          13.0p
                                                        =====          =====
                                                                            
All  items  in the Consolidated Profit and Loss Account relate  to
continuing  operations  within the  United  Kingdom  except  where
otherwise stated.
                                 
                                 
                                 
                                 
                    CONSOLIDATED BALANCE SHEET
                        As at 30 June 1999
                                                                            
                                                         1999           1998
                                      Note              £'000          £'000
                                                                            
Fixed assets                                                                
Tangible assets                                                             
 Investment and development                                                 
   properties                                         495,821        419,600
 Other tangible assets                                  1,564            197
Investments                                             3,048          3,048
                                                       ______         ______
                                                                            
                                                      500,433        422,845
                                                       ______         ______
Current assets                                                              
Trading properties                                      9,321         44,020
Debtors                                                 8,235         12,937
Investments                                               750              -
Cash at bank and in hand                                  282          3,870
                                                       ______         ______
                                                                            
                                                       18,588         60,827
Creditors - amounts falling                                                 
  due within one year                                (19,267)       (20,521)
                                                       ______         ______
                                                                            
Net current assets                                      (679)         40,306
                                                       ______         ______
                                                                            
Total assets less current                                                   
  liabilities                                         499,754        463,151
Creditors - amounts falling                                                 
  due after more than one year                      (123,713)      (169,669)
Convertible unsecured loan stock                     (49,210)              -
Provisions for liabilities                                                  
  and charges                                           (705)           (80)
                                                       ______         ______
                                                                            
Net assets                                            326,126        293,402
                                                       ______         ______
                                                                            
Capital and reserves                                                        
Called up share capital                7               60,280         60,280
Share premium account                  8              149,737        149,737
Revaluation reserve                    8               83,693         66,056
Other reserves                         8                   51             51
Profit and loss account                8               32,365         17,278
                                                       ______         ______
                                                                            
Total capital employed                                326,126        293,402
                                                       ======          =====
Net assets per share                   6               270.5p         243.4p




            CONSOLIDATED STATEMENT OF TOTAL RECOGNISED
                         GAINS AND LOSSES
                      Year ended 30 June 1999
                                 
                                                      1999              1998
                                                     £'000             £'000
                                                                            
Profit for the financial year                                               
  after taxation                                    13,164            15,396
Unrealised surplus on revaluation                                           
  of investment properties                          24,081            49,236
                                                    ______            ______
Total recognised gains and losses                                           
  for the year                                      37,245            64,632
                                                    ______            ______
                                                                            
                                 
                                 
                                 
                                 
                        NOTE OF HISTORICAL
                      COST PROFITS AND LOSSES
                      Year ended 30 June 1999

                                                     1999               1998
                                                    £'000              £'000
                                                                            
Profit on ordinary activities                                               
  before taxation                                  15,138             19,694
                                                                            
Realisation of property revaluation                                         
  gains in prior periods                            6,444              1,178
                                                   ______             ______
                                                                            
Historical cost profit on ordinary                                          
  activities before taxation                       21,582             20,872
                                                   ______             ______
                                                                            
Historical cost profit retained after                                       
  tax and dividends                                15,087             12,355
                                                   ______             ______




                   RECONCILIATION OF MOVEMENT IN
                        SHAREHOLDERS' FUNDS
                      Year ended 30 June 1999
                                 
                                                     1999               1998
                                                    £'000              £'000
                                                                   
Total recognised gains and losses                                           
  for the year                                     37,245             64,632
Dividends                                         (4,521)            (4,219)
Issue of shares                                         -            118,881
                                                   ______             ______
                                                                            
Increase in total capital employed                 32,724            179,294
Opening shareholder's funds                       293,402            114,108
                                                   ______             ______
Closing shareholders funds                        326,126            293,402
                                                   ______             ______
                                                                            
                                 
                                 
                                 
                                 
                 CONSOLIDATED CASH FLOW STATEMENT
                      Year ended 30 June 1998

                                                         1999           1998
                                         Note           £'000          £'000
Operating activities                                                        
Net cash inflow before sales of                                             
  and additions to trading                                                  
   properties                            9(a)          12,676         23,601
Net cash inflow/(outflow) from                                              
  sales of and additions                                                    
   to trading properties                 9(a)          44,724       (43,707)
                                                       ______         ______
Net cash inflow/(outflow) from                                              
  operating activities                   9(a)          57,400       (20,106)
                                                                            
Returns on investments and servicing                                        
  of finance                                                 
Interest received                                         361            524
Interest paid                                        (11,480)       (10,927)
                                                       ______         ______
Net cash outflow for returns on                                             
  Investments and servicing of                                              
   finance                                           (11,119)       (10,403)
                                                       ______         ______
Taxation                                                                    
Corporation tax paid                                  (4,379)          (531)
                                                       ______         ______
Capital expenditure                                                         
Acquisition of investment                                                   
  properties                                         (92,498)      (175,793)
Disposals and other capital                            46,288         22,246
  receipts
Purchase of other fixed assets                                              
                                                      (1,407)          (108)
                                                       ______         ______
Net cash outflow for capital                                                
  expenditure                                        (47,617)      (153,655)
                                                       ______         ______
Equity dividends paid                                 (4,340)        (1,989)
                                                       ______         ______
Cash outflow before use of                                                  
  liquid resources and financing                     (10,055)      (186,684)
                                                                            
Management of liquid resources                                              
Decrease / (increase) in cash deposit                                       
  held as security                                      2,700        (1,249)
                                                                            
Financing                                                                   
Issue of shares                                             -        118,881
Increase in debt                         9(b)           6,467         68,024
                                                       ______         ______
Net inflow from financing                               6,467        186,905
                                                       ______         ______
(Decrease) / increase in                                                    
  cash in the period                     9(b)           (888)        (1,028)
                                                       ______         ______
Notes to the Accounts

1.   Profit on disposal of trading and investment properties

                                         Trading     Investment             
                                      Properties     properties        Total
                                           £'000          £'000        £'000
                                                                            
Aggregate consideration                   37,745         48,128       85,873
Less: sales costs                          (266)          (414)        (680)
                                          ______         ______       ______
Net proceeds                              37,479         47,714       85,193
Less: historical cost of                                                    
  properties                            (34,988)       (39,667)     (74,655)
                                          ______         ______       ______
Historical cost profit                     2,491          8,047       10,538
Less: revaluation surplus                                                   
  in prior period                              -        (6,444)      (6,444)
                                          ______         ______       ______
                                           2,491          1,603        4,094
                                          ______         ______       ______

2.   Interest receivable
                                                         1999           1998
                                                        £'000          £'000
                                                                            
Loan notes - related company                               84            119
Bank deposits                                              88            226
Deposits held as security against loans                    77            152
                                                           96             51
                                                       ______         ______
                                                          345            548
                                                       ______         ______

The loan notes were issued by Agnew's Property Investments Limited
in which the Company has a 25% interest.

3. Interest payable and similar charges

                                                      1999              1998
                                                     £'000             £'000
                                                                            
Amounts payable on bank loans                                               
  and overdrafts:
 Not wholly repayable within                                                
  five years                                         2,039            10,173
 Wholly repayable within five                                               
  years                                              6,950               584
5.75% Convertible Unsecured                                                 
  Loan Stock 2013                                    2,836                 -
Less: interest capitalised                         (6,367)           (3,865)
                                                    ______            ______
                                                     5,458             6,892
                                                    ______            ______

4. Taxation

                                                      1999              1998
                                                     £'000             £'000
                                                                            
Corporation tax at 30.75% (1998 - 31%)               1,349             4,218
Deferred tax                                           625                80
                                                    ______            ______
                                                     1,974             4,298
                                                    ______            ______

The  tax  charge  has  benefited from the utilisation  of  brought
forward losses and capital allowances claimed.  No tax charge  has
arisen  from  the disposal of investment properties.   Relief  has
been  taken  during  the  year for interest  capitalised  of  £4.3
million (1998 - £3.4 million).

5. Dividend

                                                      1999              1998
                                                     £'000             £'000
                                                                            
Interim dividend paid of 1.75p                                              
  (1998: - 1.65p) per share                          2,110             1,989
                                                                            
Final dividend proposed of 2.0p                                             
  (1998: - 1.85p) per share                          2,411             2,230
                                                    ______            ______
Total dividends payable for the year                                        
of 3.75p (1998 - 3.50p) per share                    4,521             4,219
                                                    ______            ______
                                                                            
6. Earnings/net assets per share

The weighted average number of shares in issue during the year was
120,559,542  (1998:  118,335,299) and the earnings  attributed  to
ordinary shares was £13,164,000 (1998 - £15,396,000). The earnings
on  ordinary  activities  excluding net  profits  on  disposal  of
trading and investment properties comprises net rental income less
administration expenses less net interest payable and attributable
taxation  and  amounted to £9,836,000 (1998: - £10,404,650).   The
number of shares in issue at 30 June 1999 was 120,559,542 (1998: -
120,559,542) and the net assets attributable to shareholders at 30
June 1999 were £326,126,000 (1998: - £293,402,000).

Diluted  earnings per share have been calculated for  all  periods
adopting the method set out in Financial Reporting Standard  14  -
Earnings  per Share.  In calculating diluted earnings  per  share,
the  weighted  average  number of shares  has  been  increased  to
120,668,531  to  take into account the dilutive  effect  of  share
options.  The 5.75% Convertible Unsecured Loan Stock 2013  do  not
dilute  earnings  and  are  therefore excluded  from  the  diluted
earnings per share calculation.

7. Share capital

The share capital outstanding at the year end was:
                                                        1999            1998
                                                       £'000           £'000
                                                                            
Ordinary shares of 50p each:                                                
Authorised:                                           88,500          80,000
                                                      ______          ______
Allotted, called up and fully paid                    60,280          60,280
                                                      ______          ______

On 6 July 1998 the authorised share capital was increased to £88.5
million  following the Placing and Open Offer of 50 million  units
of 5.75% Convertible Unsecured Loan Stock 2013.

8. Reserves
                              Share   Revalua-     Other     Profit          
                            premium       tion  reserves   and loss     Total
                                       reserve              account
                              £'000      £'000     £'000      £'000     £'000
Group                                                                        
As at 1 July 1998           149,737     66,056        51     17,278   233,122
Revaluation surplus               -     24,081         -          -    24,081
Revaluation surplus                                                          
  written back on                                                            
   property disposals             -    (6,444)         -      6,444         -
Retained profit for                                                          
  the year                        -          -         -      8,643     8,643
                             ______     ______    ______     ______    ______
As at 30 June 1999          149,737     83,693        51     32,365   265,846
                             ______     ______    ______     ______    ______
                                                                             

9. Notes to the consolidated cashflow statement

(a) Reconciliation of operating profit to operating cash flows
                                                      1999              1998
                                                     £'000              £000
                                                                            
Operating profit                                    18,648            25,611
Depreciation                                            40                23
Profit on sale of trading properties               (2,491)           (6,615)
Amortisation of leasehold properties                   390               120
Increase in debtors                                (1,705)           (1,182)
Increase in investments                              (750)                 -
(Decrease)/increase in creditors                   (1,456)             5,644
                                                    ______            ______
Net cash inflow before trading                                              
  properties                                        12,676            23,601
Net cash inflow/(outflow) from                                              
  trading properties                                44,724          (43,707)
                                                    ______            ______
Net cash inflow/(outflow) from                                              
  operating activities                              57,400          (20,106)
                                                    ______            ______

(b) Reconciliation of net cash flow to movement in net debt
                                                      1999              1998
                                                     £'000             £'000
                                                                            
Decrease in cash in the period                       (888)           (1,028)
(Decrease)/increase in cash                                                 
  held as security against loans                   (2,700)             1,249
Cash inflow from increase in debt                  (6,467)          (68,024)
                                                    ______            ______
Change in net debt resulting from                                           
  cash flows                                      (10,055)          (67,803)
Net debt at start of period                      (165,799)          (97,996)
                                                    ______            ______
Net debt at end of period                        (175,854)         (165,799)
                                                    ______            ______

(c) Net debt movements:
                                        1999         Cashflow           1998
                                       £'000             £000          £'000
                                                                            
Cash at bank and                                                            
  in hand                                282            (888)          1,170
Cash held as security                                                       
  against loans                            -          (2,700)          2,700
                                      ______           ______         ______
Cash per balance sheet                   282          (3,588)          3,870
Bank loans less than                                                        
  one year                           (3,213)          (3,213)              -
Bank loans more than                                                        
  one year                         (172,923)          (3,254)      (169,669)
                                      ______           ______         ______
Net debt                           (175,854)         (10,055)      (165,799)
                                      ______           ______         ______
                                                                            

10.                                       Basis of preparation

The  above financial information does not constitute the company's
full  statutory accounts for the years ended 30 June 1998 or  1999
but  is  derived from these accounts.  Statutory accounts for  the
year  ended  30 June 1998 have been delivered to the Registrar  of
Companies, whereas those for 1999 will be delivered following  the
company's  Annual General Meeting.  The auditors have reported  on
those accounts; their reports were unqualified and did not contain
a  statement  under  Section 237 (2) or (3) of the  Companies  Act
1985.

The  Annual Report and Accounts will be posted to shareholders  on
or  before 5 October 1999 and will be available from the Company's
Registered Office at: 25 Sackville Street, London W1X 1DA.


                                                         

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