Final Results

HML Holdings plc

("HML" or the "Company")

Final Results for the Year Ended 31 March 2014

HML Holdings plc (AIM: HMLH), the property management services Group, announces final results for the year ended 31 March 2014.

Financial and Operational Highlights:

*before interest, share based payment charges, amortisation and tax

Commenting on the results, Rob Plumb, Chief Executive of HML Holdings said: "HML has made considerable progress during the course of the year both in sustaining its organic growth and in the effectiveness with which we integrate acquisitions into our existing operations. The group is confident of its ability to take advantage of the opportunities presenting themselves in a changing residential property management market".

For further information:

CHAIRMAN'S & CHIEF EXECUTIVE'S REPORT

We are pleased to report a further 27% improvement in our earnings before interest, share based payments, amortisation and tax to £1,355,000 (2013: £1,063,000). Profit after interest and tax improved by 31% to £836,000 (2013: £637,000) and revenues grew by 15% to £14.8m (2013: £12.8m).

In October last year we acquired the businesses of PR Gibbs (annual revenues of £220,000) in Bolton and LHH Block Management (annual revenues of £210,000) in Kensington, both of these operations have been successfully integrated into existing HML offices. The group continues to refine its process of acquiring and assimilating portfolio acquisitions and we are pleased with the extent to which both these businesses have become a part of HML.

The annualised value of acquisitions contributed approximately 5% of the 15% growth in revenues. Organic growth through new client instructions has continued with significant contributions both from existing client referrals and a rising flow of new instructions from new build developers. While price competitiveness in this relatively unregulated property management market remains strong, we have grown the number of residential units under management by 10% to 44,000 through continuing to offer a premium quality service.

We are pleased with the degree to which we have developed the systems and processes that assist with the delivery of our service which remains a complicated mix of personal service, professional expertise and automated procedure. Surveying customer satisfaction provides us with critical input into our systems design particularly given the wide ranging and commonly misunderstood demands on property management services in the leasehold market. Apart from more meaningful financial reports for our clients and leaseholders, we have recently developed and improved a number of additional support functions such as our centralised contractor approval programme and our "Out of hours" emergency service.

In addition to the improvements which we have made to our processes and services, the HML group is making further investment in our employee training and development infrastructure. We are increasingly aware of the growing complexities of residential property management services and, while we have been pleased with our progress to date in improving staff retention, we are also expanding our human resource development effort to meet these demands.

Awareness of the issues underlying the leasehold market has continued to grow for all those associated with the sector. This has become more apparent firstly with The Association of Residential Managing Agent's drive to establish minimum service standards in our industry and also with the Competition and Markets Authority which recently begun an investigation into practices within the residential property management market. We are fully supportive of both these initiatives and are optimistic about the degree to which they will improve the professional standards of our industry.

Our board is confident of the group's ability to grow both organically and through acquisitions. Opportunities to purchase businesses and portfolios within our sector of the property management market which offer good integration possibilities continue to present themselves in what has become an increasingly changing operating environment. We are pleased with the infrastructure we have built and our ability to leverage these market opportunities while keeping to the core values that have helped us to build our business. We believe that the ethical, transparent and professional provision of a wide range of complementary services that we have developed, is key to improving our ability to grow in the current market. Looking ahead, the Group remains committed to paying a maiden dividend of 0.27p per share in 2014.

Our thanks go to the Group's employees who have contributed so much to our progress this year.

Richard Smith (Chairman) Robert Plumb (Chief Executive)

ATTRIBUTABLE TO THE EQUITY HOLDERS OF THE GROUP

GENERAL INFORMATION

Whilst the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs.

The financial information is presented in pounds sterling, prepared on a historical cost basis and, unless otherwise stated, rounded to the nearest thousand. The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 31 March 2014 or 31 March 2013.

The financial information for the year ended 31 March 2013 is derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a statement under either Section 498 (2) or Section 498 (3) of the Companies Act 2006 and did not include references to any matters to which the auditor drew attention by way of emphasis.

The statutory accounts for the year ended 31 March 2014 have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them. This preliminary announcement does not constitute statutory accounts under section 435 of the Companies Act 2006.

HML Holdings plc and its subsidiaries specifically focus on residential property management. The Group operates in the UK. The Company is a public limited company incorporated and domiciled in the United Kingdom. The address of its registered office is 9-11 The Quadrant, Richmond, Surrey, TW9 1BP. The Company is listed on the AIM stock exchange.

The preliminary results were authorised for issue by the board of directors on 18 June 2014.

1. PROFIT RECONCILIATION

The reconciliation set out below provides additional information to enable the reader to reconcile to the numbers discussed in the Chairman's and Chief Executive's report

Direct operating expenses and central operating overheads include depreciation and staff costs.

Set out below is an analysis of other operating expenses;

Amounts payable to the auditor and its related entities in respect of both audit and non-audit services are set out below:

The tax assessed for the period is lower than the standard rate of corporation tax in the UK of 23% (2013: 24%). The differences are explained below:

Future tax charges may be affected by the fact that no deferred tax asset is recognised in respect of losses carried forward by HML Hathaways Limited. Deferred tax assets are not recognised until the utilisation of the losses is probable. The Group has losses carried forward in its subsidiary, HML Hathaways Limited which can be recovered against future profits arising from the same trade. The total tax losses carried forward to future years are £1,243,000 (2013: £1,243,000). The unprovided deferred tax asset in respect of these losses is £249,000 (2013: £249,000).

4. EARNINGS PER SHARE

The calculation of the basic and diluted earnings per share is based on the following data

The diluted earnings per share are the basic earnings per share adjusted for the dilutive effect of the conversion into fully paid shares of the outstanding share options.

On 31 October 2013, the trade and assets of Philip R Gibbs were purchased by HML Andertons Limited. Philip R Gibbs was a property management business based in Bolton, Lancashire. The acquisition was integrated into HML Guthrie and reinforces HML Guthrie's position as a significant property manager in the North-West of England.

The fair value of net assets acquired in the acquisition are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the acquired business.

5. BUSINESS COMBINATIONS (ACQUISITIONS) CONTINUED

Net cashflow arising on the acquisition was £255,000 which relates to the consideration paid.

The contingent consideration of £99,000 is due within one year and is adjustable depending on the retention of clients and the arrival of contracted new clients. £21,000 of this contingent consideration has been paid during the year. The range of potential payments of contingent consideration could vary from £0 to £99,000, however the more likely outcome would be to pay £99,000 in relation to the contingent consideration.

If the acquisition of Philip R Gibbs had been completed on the first day of the financial year, group revenues for the period would have been increased by £220,000 and the group profit attributable to equity holders of the parent would have increased by £30,000.

The business of Philip R Gibbs contributed £90,000 to the Group's revenue and increased the Group's profit before tax by £2,000 from the date of acquisition to the year end date.

During the year, HML Andertons also paid the vendors of The Guthrie Partnership £34,000 for a small portfolio of clients.

Also on 31 October 2013, the trade and assets of LHH Management were purchased by HML Hawksworth Limited. LHH Management was a property management business based in Kensington, London. The acquisition was integrated into HML Hawksworth Limited's Victoria office and enhances HML Hawksworth Limited's presence in the West London area.

The fair value of net assets acquired in the acquisition are set out below:

The residual difference between the total consideration paid and the net value of the recognised assets acquired has been capitalised as goodwill. The goodwill recognised on the acquisition is mainly attributable to the skills and knowledge within the acquired business.

Net cashflow arising on the acquisition was £237,000 which relates to the consideration paid.

5. BUSINESS COMBINATIONS (ACQUISITIONS) CONTINUED

The contingent consideration of £58,000 is due within one year and is adjustable depending on the retention of clients and the arrival of contracted new clients. The range of potential payments of contingent consideration could vary from £0 to £58,000, however the more likely outcome would be to pay £58,000 in relation to the contingent consideration.

If the acquisition of LHH had been completed on the first day of the financial year, group revenues for the period would have been increased by £210,000 and the group profit attributable to equity holders of the parent would have increased by £28,000.

The business of LHH contributed £84,000 to the Group's revenue and increased the Group's profit before tax for the period by £7,000 from the date of acquisition to the year-end date.