4th May 2005 07:00
Cardiff Property PLC04 May 2005 THE CARDIFF PROPERTY PUBLIC LIMITED COMPANY AND ITS SUBSIDIARIES FOR RELEASE 7.00 AM 4 MAY 2005 THE CARDIFF PROPERTY PLC (The group, including Campmoss, specialises in property investment and development in the Thames Valley. The portfolio, valued in excess of £40m, isprimarily located to the west of London, close to Heathrow Airport and in Surrey and Berkshire.) INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2005 Highlights: Six months Six months Year 31 March 31 March 30 September 2005 2004 2004 (Unaudited) (Unaudited) (Audited) Group turnover* £'000 2,005 1,621 2,679Property sales £'000 1,113 nil nilNet assets per share** pence 928 807 895Profit before tax £'000 1,160 943 1,758Earnings per share pence 53.4 38.2 80.2Interim/final dividend pence 2.5 2.2 8.0 per shareGearing % nil nil nil * Includes the group's share of Campmoss** Properties not revalued at half-year Richard Wollenberg, Chairman, commented: "New office lettings reported in the Thames Valley indicate a small increase inheadline rental levels but the volume remains low. Compared to this inactivity,the level of investment interest in the commercial property market hasintensified. With interest rates at current low levels and a relatively stableeconomy, I would expect investment values to remain strong. However, anyimmediate improvement in rental levels will be limited." For further information The Cardiff Property plc Richard Wollenberg 01784 437444Arbuthnot Securities Richard Dunn 020 7012 2000 THE CARDIFF PROPERTY PLC INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2005 CHAIRMAN'S INTERIM STATEMENT New office lettings in the Thames Valley remain at a low level and althoughnumerous enquiries from both large and small companies are currently in themarket place, firms still seem reluctant to commit themselves. Whilst newlettings reported indicate a small increase in headline rental levels,incentives such as rent free periods and contribution to fitting out costs arestill being negotiated albeit at a reduced level. Compared to this inactivity, the level of investment interest in the commercialproperty market has intensified as pension funds and private trusts compete toinvest their funds. This is primarily relevant to new high grade commercialproperty let on medium to long term leases where yields available comparefavourably with other investment products. As a result, capital values haveincreased and, as indicated later in this report, we have taken advantage ofthis. In addition to the competition between investment funds it is noticeable thatowner occupiers are taking advantage of current low interest rates, preferringto acquire a freehold rather than paying rental. Reflecting this trend, anacceptable offer was received for our vacant unit at The Windsor Business Centreand a freehold sale completed in January 2005. We still retain the adjoiningfive business units which are all let on medium term leases. The residential market has generated some transactions but purchasers are takingmuch longer to make positive decisions and becoming more price conscious.Selling prices have seen a further decline of approximately 5% over the past 6months. This inactivity and reduction in sale prices will inevitably have aneffect on land values although I am of the view that this has not as yet beenfully reflected in the market place. As indicated later on in this report, Campmoss Property Company Limited, our47.62% owned joint venture undertaking, also took advantage of the stronginvestment market and, following an attractive offer, completed the sale of afreehold property in March 2005. Taking into account the above activity, profit on ordinary activities before taxfor the half year to 31 March 2005, amounted to £1.160m (2004: £0.943m) whichincluded a contribution from Campmoss of £0.473m (2004: £0.583m). Group turnovertotalled £2.005m (2004: £1.621m) representing gross rental income of £0.892m(2004: £1.621m) and sales of commercial properties totalling £1.113m (2004:nil). The comparative gross rental figure included proceeds received by Campmossfollowing the surrender of a lease. Earnings per share was 53.4p (2004: 38.2p). DividendThe directors have declared an increased interim dividend of 2.5p per share(2004: 2.2p) which will be paid on 8 July 2005 to shareholders on the registeron 10 June 2005. Financial Net assets at 31 March 2005, including our share of Campmoss, totalled £16.547m(2004: £16.430m) equivalent to 928p per share (March 2004: 807p - September2004: 895p). The property portfolio is valued annually and therefore the figuresfor the half year are based on values as at 30 September 2004. Following thesales and purchase referred to in this report cash balances increased and havebeen placed on short term deposit. Bank borrowing facilities remain available toallow further acquisitions. The investment and development portfolio The commercial investment portfolio includes a range of retail, industrial andoffice buildings located in Egham, Windsor and Cardiff. These properties are letto well known public and private companies on medium to long term institutionalleases. One of the four new residential houses in Egham has been sold and one let. AtAshleigh House, Englefield Green, Surrey, although interest has been received,no acceptable offer has been forthcoming and the property remains available forsale. Houses in Windsor and Egham have been retained and let on yearlyagreements. In February, the freehold of a vacant 15,000 sq ft industrial and officebuilding in Maidenhead was acquired for just under £0.8m. The intention, subjectto obtaining appropriate planning permission, is to carry out a totalrefurbishment and divide the finished building into individual business units ofbetween 2,000 and 5,000 sq ft. The units will offer ground floor industrial useand first floor office use. On completion, these units will be placed on themarket for either letting or sale. Appropriate plans have been submitted to theLocal Authority and, in the meantime, part of the refurbishment works havecommenced. Campmoss Property Company Limited Campmoss has again experienced an active six months period. Against a backgroundof low tenant demand, a letting of our new 10,000 sq ft office building at YorkRoad, Maidenhead was successfully achieved in February and following the receiptof an offer for the freehold at substantially above book value, a sale to aleading institution was completed in March 2005. Campmoss continues to retain freehold properties at Maidenhead, Woking, Burnhamand Bracknell. Gross annual rental income generated from the portfolio is now inexcess of £2.70m. In October 2004, a vacant 10,000 sq ft office building known as Jubilee House,located on the outskirts of Datchet, Berkshire, close to the M4 motorway, wasacquired with a view to changing the use of the property to residential. I ampleased to report that planning permission has been granted for 24 residentialunits and further discussions with adjacent property owners and the planningdepartment are currently in hand. The obtaining of planning permission remains a prolonged and time consumingprocess. Revised plans have again been submitted to the relevant localauthorities for our residential and commercial schemes in Bracknell Town Centreand Worplesdon, Guildford. We await the outcome of our presentations. Part ofthe property in Bracknell has been let on a short term basis. At Highway House, Maidenhead, despite a number of viewings by prospectivetenants, three of the recently refurbished floors remain available for letting. Share dealing facility The low commission share dealing facility provided by the company's registrar,Computershare Investor Services Plc, has been extended. Computershare can becontacted on 0870 703 0084. Outlook As new office letting activity remains subdued developers are inevitablyreluctant to commence new office projects. Leading commercial property agentsare, however, predicting a marked upturn in letting activity, and if this is thecase there will be a scarcity of available space in certain locations leading toan uplift in rental values. It is interesting to note that a number of recentlyformed specialist funds recognising this possibility, have entered into theinvestment market with a specific mandate to acquire newly developed commercialproperty let on medium to long term leases located in the Thames Valley. With interest rates at current low levels and a relatively stable economy,yields on commercial property are higher than the majority of other investmentsin the market place and I would therefore expect investment values to remainstrong. However, whilst new vacant office space will eventually be taken up, anyimmediate improvement will be limited. Your directors will continue to evaluate development opportunities as theyarise. The group retains a well balanced commercial property portfolio together with anumber of exciting projects which are all subject to the grant of planningpermissions. I look forward to reporting to you with further progress at theyear end. J Richard WollenbergChairman3 May 2005 Consolidated Profit and Loss AccountFOR THE SIX MONTHS ENDED 31 MARCH 2005 Six months Six months Year 31 March 31 March 30 September 2005 2004 2004 (Unaudited) (Unaudited) (Audited) £'000 £'000 £'000Turnover Group and share of joint venture undertaking 2,005 1,621 2.679Less: share of joint venture undertaking (641) (1,247) (1,948) ______ ______ ______ Group turnover 1,364 374 731Cost of sales (712) (27) (93) ______ ______ ______ Gross profit 652 347 638 Administrative expenses (247) (234) (471)Other operating income 168 195 316 ______ ______ ______ Operating profitGroup 573 308 483Share of operating profit in jointventure undertaking 364 889 1,387 ______ ______ ______ Total 937 1,197 1,870 Profit on sale of investment propertyGroup - - 460Share of joint venture undertaking 435 - 31Profit on sale of other investments (group) 1 - -Amounts written off investment (group) - - (86) ______ ______ ______ Profit on ordinary activities before interest 1,373 1,197 2,275Interest receivable and similar income Group 113 121 240 Share of joint venture undertaking 3 1 3Interest payable Group - (69) (152) Share of joint venture undertaking (329) (307) (608) ______ ______ ______Profit on ordinary activities before taxation 1,160 943 1,758 Tax on profit on ordinary activities Group (198) (100) (86) Share of joint venture undertaking (20) (70) (132) ______ ______ ______Profit on ordinary activities after taxation being profit for the period 942 773 1,540 Dividends (47) (46) (140) ______ ______ ______ Retained profit for the period 895 727 1,400 ______ ______ ______Earnings per share - pence On profit for the six months Basic 53.4 38.2 80.2 Diluted 53.2 37.6 78.7 ______ ______ ______ The above results relate entirely to continuing activities. There were noacquisitions or disposals of businesses during the period. Consolidated Balance SheetAT 31 MARCH 2005 31 March 31 March 30 September 2005 2004 2004 (Unaudited) (Unaudited) (Audited) £'000 £'000 £'000Fixed assetsTangible assets: Investment properties 4,719 6,135 3,935 Other 5 6 5 ______ ______ ______ 4,724 6,141 3,940 ______ ______ ______Investments: Investment in joint venture undertaking Share of gross assets 16,471 16,893 16,651 Share of gross liabilities (10,524) (11,568) (11,159) ______ ______ ______ 5,947 5,325 5,492 Other investments 303 397 311 ______ ______ ______ 6,250 5,722 5,803 ______ ______ ______ Total fixed assets 10,974 11,863 9,743 ______ ______ ______Current assets Stock and work in progress 2,799 3,210 3,423Debtors 487 3,082 2,369Cash at bank and in hand 3,660 3,227 1,349 ______ ______ ______ 6,946 9,519 7,141 Creditors: amounts falling due withinone year (955) (1,203) (923) ______ ______ ______ Net current assets 5,991 8,316 6,218 ______ ______ ______ Total assets less current liabilities 16,965 20,179 15,961 Creditors: amounts falling due aftermore than one year - (3,200) - Provisions for liabilities and charges (418) (549) (413) ______ ______ ______ Net assets 16,547 16,430 15,548 ______ ______ ______ Capital and reservesCalled up share capital 357 407 347Share premium account 4,944 4,850 4,850Investment property revaluation reserve 4,261 4,259 4,261Other reserves 2,291 2,231 2,291Profit and loss account 4,694 4,683 3,799 ______ ______ ______ Shareholders' funds - equity 16,547 16,430 15,548 ______ ______ ______ Net assets per share 928p 807p 895p Consolidated Cash Flow StatementFOR THE SIX MONTHS ENDED 31 MARCH 2005 Six months Six months Year 31 March 31 March 30 September 2005 2004 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Cash inflow/(outflow) from operating activities 3,048 (1,144) (512)Returns on investment and servicing of finance 72 86 127Taxation - - (361)Capital expenditure and financial investment (773) (100) 3,010Equity dividends paid (103) (103) (142) ______ ______ ______ Cash inflow/(outflow) before financing 2,244 (1,261) 2,122Financing 104 37 (5,168) ______ ______ ______Increase/(decrease) in cash in the period 2,348 (1,224) (3,046) ______ ______ ______ Reconciliation of net cash flow to movement in net funds/(debt) Increase/(decrease) in cash in the period 2,348 (1,224) (3,046)Bank loans repaid - - 3,200 ______ ______ ______ 2,348 (1,224) 154 Net funds at beginning of period 1,312 1,158 1,158 ______ ______ ______ Net funds/(debt) at end of period 3,660 (66) 1,312 ______ ______ ______ Reconciliation of operating profit to net cash flow from operating activities Operating profit (group) 573 308 483Depreciation charges 2 1 2Decrease/(increase) in stock and work in progress 624 (316) (529)Decrease/(increase) in debtors 1,845 (1,167) (454)Increase/(decrease) in creditors and provisions 4 30 (14) ______ ______ ______ Net cash inflow/(outflow) from operating activities 3,048 (1,144) (512) ______ ______ ______ Notes to the Financial StatementsFOR THE SIX MONTHS ENDED 31 MARCH 2005 1 Basis of preparation The figures for the six months ended 31 March 2005, which were approved by theboard on 3 May 2005, are prepared on the same basis of accounting as for theyear ended 30 September 2004 and are unaudited. The figures for the year ended 30 September 2004 are extracted from thestatutory financial statements for that year which have been filed with theRegistrar of Companies and on which the auditor gave an unqualified report,without any statement under section 237(2) or (3) of the Companies Act 1985. 2 Analysis of turnover, profit on ordinary activities before interest andtaxation and net operating assets Six months Six months Year 31 March 31 March 30 September 2005 2004 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 Turnover (wholly in the UnitedKingdom) Gross rents receivable: Group 251 374 731 Share of joint venture undertaking 641 1,247 1,948 Sales of development property (group) 1,113 - - ______ ______ ______ 2,005 1,621 2,679 ______ ______ ______ Profit on ordinary activities before interest and taxation Property and other investment: Group 68 308 857 Share of joint venture undertaking 799 889 1,418 Property development (group) 506 - - ______ ______ ______ 1,373 1,197 2,275 ______ ______ ______Net operating assets Property and other investment 12,710 13,008 12,070 Property development 3,837 3,422 3,478 ______ ______ ______ 16,547 16,430 15,548 ______ ______ ______ 3 Taxation The tax position for the six months is estimated on the basis of the anticipatedtax rates applying for the full year. 4 Dividends Year Year 30 September 30 September 2005 2004 £'000 £'000 Interim 2.5p per share 45 Interim 2.2p per share 46 Increase in 2004 final Reduction in 2004 interim dividend dividend following issue following redemption of own of shares in respect of shares (7) options exercised 2 Final - Final 5.8p per share 101 ______ ______ 47 140 ______ ______ The interim dividend of 2.5p per share will be paid on 8 July 2005 toshareholders on the register on 10 June 2005. 5 Earnings per share Earnings per share has been calculated in accordance with FRS 14 - Earnings perShare using the profit after tax for the period of £942,000 (six months to 31March 2004: £773,000; year to 30 September 2004: £1,540,000) and the weightedaverage number of shares as follows: Weighted average number of shares 31 March 31 March 30 September 2005 2004 2004 Basic 1,764,936 2,024,337 1,920,304Adjustment to basic for bonus element of shares to be issued on exercise of options 7,018 33,561 36,716 _________ _________ _________ Diluted 1,771,954 2,057,898 1,957,020 _________ _________ _________ 6 Reconciliation of movements in shareholders' funds 31 March 31 March 30 September 2005 2004 2004 (unaudited) (unaudited) (audited) £'000 £'000 £'000 At beginning of period 15,548 15,666 15,666 Profit after tax for the period 942 773 1,540Dividends (47) (46) (140)Revaluation of investment properties - - 450Share options exercised in period: Increase in share capital 10 4 4 Increase in share premium 94 33 33Own shares purchased in period - - (2,005) ______ ______ ______ At end of period 16,547 16,430 15,548 ______ ______ ______ This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Cardiff Property