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Probus Estates PLC (PBE)

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Monday 19 December, 2005

Probus Estates PLC

Final Results

Probus Estates PLC
19 December 2005


                               Probus Estates PLC
                      ('Probus Estates' or the 'Company')

            Preliminary results for the year ended 31 December 2004


Chairman's statement

Results

Turnover for the year was €7.3 million, including sales of €3.4 million at
Casino de Mallorca in the period up until its sale in April 2004.  The remaining
turnover represents rental income in the Netherlands and sales of units at Santa
Ponsa in Mallorca.

The Group incurred an operating loss of €2.0 million (2003 €44.7 million loss).
The overall Group loss after tax was €17.4 million (2003 €54.6 million loss).

Review of major events

The sale of Casino de Mallorca in April 2004 was reported in the Chairman's
Statement in the Annual Report for 2003.  Since then there have continued to be
occasional sales of units at Santa Ponsa.  There has been no progress on the
development of Can Vinyes and various discussions have taken place concerning
its sale, but no binding contract has yet been agreed.

Financial position

The Company's financial position continues to be extremely difficult.  The
Company's shares have been suspended from trading since 23 June 2005 due to the
Company's inability to issue its annual accounts within the timescale set out in
the AIM Rules.

As I reported last year, the Group is able to service its bank debt in the
Netherlands using rental income from its Dutch properties, and its bank debt in
Spain using sale proceeds from the retail development at Santa Ponsa.  The Group
is not currently in a position to repay its debt to Uni-Invest, the major
creditor, on which it is in default.

The Directors are aware of possible third-party interest in an acquisition of
Uni-Invest's position of debt and equity in the Company, but they are also aware
that Uni-Invest is entitled to enforce the charges it has on the Group's
properties and that Uni-Invest will not wait indefinitely to recover the debt
due to it.  As previously reported, the Standstill Agreement which was entered
into with Uni-Invest expired on 30 June 2004.  Since then the Company has relied
on Uni-Invest's forbearance, but recently the Board has been under increasing
pressure from Uni-Invest to conclude sales of the Group's assets.

The Directors have no control over any discussions that Uni-Invest may have with
third parties and cannot therefore predict the timing, or the likely outcome, of
such discussions.  If Uni-Invest's position was taken over by a third party, it
would be the expectation of the Directors that the Company would be
recapitalised and its financing structured on a more long term basis.  However,
if these, or any other, discussions do not have a favourable outcome, and if and
when sales of the remaining assets are concluded, any proceeds after
satisfaction of secured bank borrowings will be paid to Uni-Invest, and the
Company and its subsidiaries are likely to be placed in liquidation.  For this
reason, the Directors have written down all assets to the value which they
believe is recoverable in the near future, but they recognise that the valuation
of the development land at Can Vinyes is dependent on future cooperation with
the local authority, and that is difficult to assess.

Under the AIM Rules, the interim results of the company for the six months ended
30 June 2005 were due to be released by 30 September 2005.  The Directors expect
that the annual report and accounts will be posted to shareholders on 22
December 2005 and that the interim results will be released before the end of
this week.  On announcement of the interim results, the Directors will request
that the suspension of the shares from trading on AIM is lifted.

Hans R Junge Chairman and Chief Executive
19 December 2005



Group profit and loss account
for the year ended 31 December 2004

                              Year ended   Year ended   Year      Year ended   Year ended   Year
                              31 December  31 December  ended     31 December  31 December  ended
                              2004         2004         31        2003         2003         31
                              Before       Exceptional  December  Before       Exceptional  December
                              exceptional  Items        2004      Exceptional  Items        2003
                              items                     Total     Items                     Total
                      Notes   €000         €000         €000      €000         €000         €000

Turnover
Continuing operations         3,951        -            3,951     6,205        -            6,205
Discontinued                  3,368        -            3,368     13,710       -            13,710
operations                    
                              7,319        -            7,319     19,915       -            19,915

Cost of sales                 (3,052)      (51)         (3,103)   (15,949)     (35,236)     (51,185)
Gross profit/(loss)           4,267        (51)         4,216     3,966        (35,236)     (31,270)
Administrative                (1,268)      (4,941)      (6,209)   (2,895)      (10,577)     (13,472)
expenses

Operating profit/
(loss)
Continuing operations         1,755        (4,992)      (3,237)   3,009        (45,813)     (42,804)
Discontinued                  1,244        -            1,244     (1,938)      -            (1,938)
operations
                              2,999        (4,992)      (1,993)   1,071        (45,813)     (44,742)

Loss on disposal of           -            (8,323)      (8,323)   -            -
discontinued
operations

Profit/(loss) on              2,999        (13,315)     (10,316)  1,071        (45,813)     (44,742)
ordinary activities
before interest and
tax

Interest receivable           10           -            10        31           -            31

Interest payable              (6,738)      -            (6,738)   (7,799)      -            (7,799)

Loss on ordinary              (3,729)      (13,315)     (17,044)  (6,697)      (45,813)     (52,510)
activities before
taxation

Taxation                      (331)        -            (331)     (2,120)      -            (2,120)

Loss for the year             (4,060)      (13,315)     (17,375)  (8,817)      (45,813)     (54,630)

Loss per share, basic    2    -            -            (2.9c)                 -            (9.7c)
and diluted




Group balance sheet
as at 31 December 2004
                                                                            31         31
                                                                            December   December
                                                                            2004       2003
                                                                            €000       €000
Fixed assets
Intangible assets
 Goodwill                                                                   -          8,029
Tangible assets
 Investment properties                                                      25,504     30,445
 Freehold land and buildings                                                -          23,022
 Plant and equipment                                                        2          4,098

                                                                            25,506     65,594

Current assets
Stock                                                                       -          87
Development properties                                                      4,186      4,989
Development land                                                            16,450     16,501
Debtors                                                                     1,290      2,151
Cash at bank and in hand                                                    74         831

                                                                            22,000     24,559

Creditors - amounts falling due within one year                             (53,870)   (73,943)
Net current liabilities                                                     (31,870)   (49,384)
Total assets less current liabilities                                       (6,364)    16,210
Creditors - amounts falling due after more than one year
Convertible loan notes                                                      (11,850)   (11,850)
Other creditors                                                             (22,377)   (26,623)

                                                                            (34,227)   (38,473)

Net liabilities                                                             (40,591)   (22,263)

Capital and reserves
Called up share capital                                                     65,502     65,502
Share premium account                                                       34,118     34,118
Profit and loss account                                                     (140,211)  (121,883)
Equity shareholders' deficit                                                (40,591)   (22,263)




Company balance sheet
as at 31 December 2004
                                                                            31         31
                                                                            December   December
                                                                            2004       2003
                                                                            €000       €000

Fixed assets
Investments in subsidiary undertakings                                      15,975     21,421

                                                                            15,975     21,421

Current assets
Debtors                                                                     3,409      21,475
Cash at bank and in hand                                                    13         1

                                                                            3,422      21,476


Creditors - amounts falling due within one year                             (50,054)   (57,369)
Net current liabilities                                                     (46,632)   (35,893)

Total assets less current liabilities                                       (30,657)   (14,472)
Creditors - amounts falling due after more than one year
Convertible loan notes                                                      (11,850)   (11,850)
Net liabilities                                                             (42,507)   (26,322)

Capital and reserves
Called up share capital                                                     65,502     65,502
Share premium account                                                       34,118     34,118
Profit and loss account                                                     (142,127)  (125,942)
Equity shareholders' deficit                                                (42,507)   (26,322)




Other Group primary statements
for the year ended 31 December 2004
Group statement of total recognised gains and losses
                                                                            Year ended Year ended
                                                                            31         31
                                                                            December   December
                                                                            2004       2003
                                                                            €000       €000

Loss for the year                                                           (17,375)   (54,630)
Deficit arising on revaluation of investment properties                     -          (315)
Currency translation differences                                            (953)      233
Total recognised gains and losses relating to the financial year            (18,328)   (54,712)




Group reconciliation of movements in shareholders' deficit
                                                                            Year ended Year ended
                                                                            31         31
                                                                            December   December
                                                                            2004       2003
                                                                            €000       €000

Loss for the year                                                           (17,375)   (54,630)
Currency translation differences                                            (953)      233
Deficit arising on revaluation of investment properties                     -          (315)
Increase in share capital                                                   -          810
Premium arising on issue of shares                                          -          33
Net increase in shareholders' deficit                                       (18,328)   (53,869)
Opening equity shareholders' (deficit)/funds                                (22,263)   31,606
Closing equity shareholders' deficit                                        (40,591)   (22,263)





Group cash flow statement
for the year ended 31 December 2004
                                                                            31         31
                                                                            December   December
                                                                            2004       2003
                                                                            €000       €000

Net cash inflow from operating activities                                   3,956      4,792

Returns on investments and servicing of finance
Interest received                                                           10         31
Interest paid                                                               (1,633)    (3,982)
Net cash outflow from returns on investments                                (1,623)    (3,951)
and servicing of finance
Taxation
Corporation tax paid                                                        (93)       (20)

Capital expenditure
Proceeds from sale of tangible fixed assets                                 -          108
Purchase of other tangible fixed assets                                     -          (168)
Net cash outflow from capital expenditure                                   -          (60)

Acquisitions and disposals
Sale of subsidiaries                                                        13,309     -
Net cash inflow from acquisitions and disposals                             13,309     -
Cash inflow before financing                                                15,549     761

Financing
Issue of ordinary share capital                                             -          843
Loans repaid                                                                (14,162)   (2,375)
Net cash outflow from financing                                             (14,162)   (1,532)
Increase/(decrease) in cash in the year                                     1,387      (771)



Notes

1.   The financial information set out above does not constitute the Group's
     statutory accounts for the years ended 31 December 2004 or 31 December 
     2003, but is derived from those accounts.

     Statutory accounts for the year ended 31 December 2003 have been delivered 
     to the Registrar of Companies. The auditor's report on the 2003 accounts 
     was unqualified, but did refer to a fundamental uncertainty as to the 
     ability of the company to continue in existence and as to the possible sale 
     of the debt and equity interests in the Company.  The wording extracted 
     from the auditor's report is as follows:

     'Going concern

     'In forming our opinion, we have considered the adequacy of the disclosures 
     made in note 1 of the financial statements concerning the fundamental 
     uncertainty over the ability of the company and Group to continue in 
     existence which is dependent upon the continued availability of existing 
     financing and further financing becoming available, either from the 
     existing major creditor, which is also a shareholder in the Company, or 
     from the purchase of its debt and equity interests in the Company, the 
     possible sale of which is currently under discussion.  In view of the 
     significance of this uncertainty, we consider that this should be brought 
     to your attention but our opinion is not qualified in this respect.'

     The 2004 statutory accounts will be delivered to the Registrar of Companies
     following the Company's annual general meeting. The auditor's report on the
     2004 accounts was qualified.  The qualification was in respect of a 
     limitation of scope in relation to the auditors' access to the books and 
     records of the Spanish subsidiaries sold during the year, but in other 
     respects was unqualified.  The audit report also referred to a fundamental 
     uncertainty over the company's ability to continue in existence due to the 
     availability of funding and also a fundamental uncertainty over the 
     carrying value of certain of the company's assets.  The wording extracted 
     from the auditors' report is as follows:

     'Basis of audit opinion

     'We planned our audit so as to obtain all the information and explanations 
     which we considered necessary in order to provide us with sufficient 
     evidence to give reasonable assurance that the financial statements are 
     free from material misstatement, whether caused by fraud or other 
     irregularity or error.  However, the evidence available to us was limited 
     because we had no access to the books and records of the group's Spanish 
     subsidiaries sold during the year and were therefore unable to obtain 
     sufficient evidence to be able to form a view on the analysis of the 
     results from discontinued operations disclosed on the face of the profit 
     and loss account and in note 2 to the financial statements, and the 
     resultant loss on disposal of discontinued operations as disclosed on the 
     face of the profit and loss account.'

     'Fundamental uncertainty over going concern
     
     'In forming our opinion, we have considered the adequacy of the disclosures 
     made in note 1 of the financial statements concerning the fundamental 
     uncertainty over the ability of the company and group to continue in 
     existence which is dependent upon the continued availability of existing 
     financing and further financing becoming available, either from the 
     existing major creditor, which is also a shareholder in the company, or 
     from any purchaser of its debt and equity interests in the company, for 
     which expressions of interest have been received, although formal 
     discussions have not yet commenced.  In view of the significance of this 
     uncertainty, we consider that it should be brought to your attention but
     our opinion is not further qualified in this respect.'

     'Fundamental uncertainty over carrying value of land and investments in
     subsidiary undertakings

     'In addition, in forming our opinion, we have considered the adequacy of 
     the disclosures made in notes 12 and 9 to the financial statements 
     concerning the uncertainty over the recoverability of the carrying value of 
     the development land in Spain, which has been assessed by the directors on 
     the basis of an indicative offer from a potential purchaser.  Until such 
     time as that or any other sale is completed, there is uncertainty over the 
     net realisable value of this development land on which it has not proved 
     possible to obtain planning consent.  The carrying value of this land is 
     also critical in the assessment of the carrying value of investments in 
     subsidiary undertakings as set out in note 9 to the financial statements.  
     In view of the significance of this uncertainty, we consider that it should 
     be brought to your attention but our opinion is not further qualified in 
     this respect.'

     'Qualified opinion arising from limitation in audit scope
     
     'In our opinion the financial statements give a true and fair view of the 
     state of affairs of the company and the group as at 31 December 2004 and, 
     except for any adjustments that might have been found to be necessary had 
     we been able to obtain sufficient evidence concerning the results and loss 
     on disposal of discontinued operations, of the loss of the group for the 
     year then ended and have been properly prepared in accordance with the 
     Companies Act 1985.

     'In respect solely of the limitation on our work relating to discontinued
     operations, we have not obtained all the information and explanations that 
     we considered necessary for the purposes of our audit.'

2.   Loss per share

     Loss per share of 2.9 cents (2003: 9.7 cents) has been calculated on the 
     basis of a weighted average number of ordinary shares in issue during the 
     year ended 31 December 2004 of 595,523,083 (2003: 564,286,566) and the loss 
     after taxation of €17,375,000 for the year (2003: €54,630,000).

3.   Dividend

     The Directors do not recommend the payment of a dividend.

4.   Copies of the annual report and accounts are expected to be posted to 
     shareholders on 22 December 2005 and will be available for one month from 
     that date from the registered office of the Company at Fifth Floor, 17 
     Hanover Square, London W1S 1HU.



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