27th Aug 2009 12:10
SUMMARY
The consolidated loss after taxation of the Group for the period ended 30 June 2009 amounted to £13,442,737 (period ended 30 June 2008: loss of £14,952,729, year ended 31 December 2008: loss of £49,039,791).
During the Period the Ordinary Share net asset value fell from 41.44 pence per share to 27.90 pence per share, a decrease of 32.7%. The 'D' Ordinary Share net asset value fell from 15.15 pence per share to 4.36 pence per share, a decrease of 71.2%.
The Company paid no dividends during the Period having suspended dividends for the "D" Ordinary Shares and Ordinary Shares in October 2008 and January 2009 respectively.
The Board continues to work with a specialist debt adviser to secure dispensation from both lending banks for the breach of the LTV covenants. Discussions to date indicate that both banks are willing to waive the LTV covenants for a period of time in return for the Group paying a higher level of interest and an agreement to use any excess revenues to pay down part of the outstanding loans. It is hoped that all facilities will be successfully negotiated in the coming months.
Chairman's Statement
Introduction
The UK commercial property market continued to struggle in the first half of 2009 as the illiquidity which has characterised the transaction markets since the onset of the global financial crisis has continued. This has been compounded by the deterioration in the occupier markets following the downturn in the "real economy". According to the Investment Property Databank ("IPD") capital values have fallen by 44% from their peak in July 2007 to June 2009.
A more detailed economic and commercial property market commentary is contained in the Property Investment Adviser's Report.
Investment Progress
No acquisitions or sales were made during the Period.
The Board continues to monitor the Ordinary Share Portfolio and "D" Ordinary Share Portfolio for assets which could be sold and will seek to do so where the Board believes a property is overvalued or where they believe active asset management has been exhausted. However, given the continued illiquidity in the transaction market, the extent to which values have fallen and therefore the notional level of current equity associated with individual properties short term sales are unlikely. In addition, as the majority of properties continue to generate income in excess of interest servicing costs the Board's strategy will be to hold the properties in the expectation of a stabilisation in the market. In the meantime any excess cash will be used to reduce gearing levels.
The Board believes that capital values may continue to fall in the short term and that the sustained reduction in the availability of debt finance is likely to continue to limit transaction activity.
Capital values in the prime end of the market are beginning to stabilise, but in the secondary and tertiary sectors of the market investors are still demanding an enhanced premium as a result of the acknowledged increase in the risk of investing in these assets.
There is material uncertainty as to the impact of falling market rents and how these will change the Group's income levels. The relatively short weighted average lease term and rise in the rate of tenant default exposes the Group to declining market rents. However the Board remains optimistic that rental levels in the Group's properties should decline by less than the market over the medium term.
Each of the Group's properties is managed by the Group's asset managers and strong relationships have been formed with most tenants. For tenants in true financial difficulty, solutions including monthly rent payments, payment plans or rent free periods are being implemented with the intention of averting, where possible, tenant defaults.
It has always been the intention that the tenant mix in the Group's properties is weighted towards small and independent businesses. Such businesses are less likely to move given the premium they place on continuity, the costs involved in moving and the time taken to rebuild a business in a new location. However, these types of businesses tend to be more vulnerable during a recession to adverse cash flows.
Debt
The Group remains in breach of the loan to value covenants in its loan facility agreements with Nationwide and Bank of Scotland. As at 30 June 2009 the loan to value ratio ("LTV") for the Ordinary share and "D" Ordinary share was 74.6% and 90.8% respectively.
The Board continues to work with a specialist debt adviser to secure dispensation from both lending banks for the breach of the LTV covenants in return for the Group paying a higher level of interest and an agreement to use any excess revenues to pay down part of the outstanding loans.
To date the Group has been offered continuation terms from Nationwide which have been credit approved within Nationwide. It is expected that these revised terms will be signed and completed in the coming months. The terms, as provided and documented, have increased the margin that Nationwide charge the Group and have instigated a cash sweep such that all available cash after interest and appropriate costs are used to pay down the loan on a quarterly basis. In return for these concessions the Group will receive a waiver in its LTV covenants for a period of time.
Negotiations with Bank of Scotland are currently ongoing and the Board remains positive that a successful outcome will be reached. Whilst terms for continuation of the Bank of Scotland debt facility have been received and are acceptable to the Group they have not as yet received credit approval within Bank of Scotland. However they are similar in form to the terms already provided and approved by Nationwide. Given the change in ownership of Bank of Scotland to the Lloyds Banking group and the part nationalisation of the group they are experiencing significant delays in seeking new credit decisions. The Group does not have a firm date for the application to go before the Lloyds Banking Group Credit team, however, it is hoped that all facilities will be successfully renegotiated in the coming months.
Results and Dividends
The consolidated loss of the Group for the six months ended 30 June 2009 was £13,442,737 (December 2008: loss of £49,039,791, June 2008: loss of £14,952,729). This loss includes an unrealised loss on the revaluation of the investment properties of £14,630,153 (December 2008: loss of £50,044,066, June 2008: loss of £17,152,294).
The Net Asset Value ("NAV") of the Ordinary Share Portfolio fell 32.7% over the six month period to 30 June 2009 ("Period") from 41.44 pence per share to 27.90 pence per share. The NAV of the "D" Ordinary Share Portfolio fell 71.2.% over the Period from 15.15 pence per share to 4.36 pence per share.
The Company paid no dividends during the Period having suspended dividends for the "D" Ordinary Shares and Ordinary Shares in October 2008 and January 2009 respectively.
The Board is aware that the suspension in dividend payments has been a cause of some concern to shareholders. The Board is of the opinion that it may, in the absence of any unforeseen circumstances, be possible to re-establish the Ordinary Share dividend following a period in which the Group's debt (and therefore LTV ratio) is reduced as a result of a possible future appreciation in capital values and the paying down of debt with surplus cash. The Board is less confident about the possibility of re-establishing the "D" Ordinary Share dividend and does not see it being re-instated in the foreseeable future.
Cancellation of Shares
The Company did not undertake any share buy-backs during the Period. If the Board is successful in renegotiating its banking facilities all surplus cash is likely to be used to reduce debt.
The Board will continue to monitor the discount to NAV and consider the appropriateness of buying back shares in the market. However, its primary aim is to ensure that the Group has sufficient liquidity to meet its needs until the upcoming shareholder continuation vote.
Future Prospects
As at 30 June 2009 the LTV ratio for the Ordinary and "D" Ordinary shares was 74.6% and 90.8% respectively. Nationwide has now provided the Board with a proposal for re-structuring the existing loan facility.
Negotiations with the Bank of Scotland are not as advanced although the Board expects both proposals to be completed over the coming months.
Securing satisfactory refinancing from the Group's lending banks is an essential first step in attempting to recover value for shareholders. This will avoid the possibility of a bank induced fire sale of assets, which would have likely returned very little value to shareholders. It also places the Company on a more stable footing going forward.
Thereafter the Board will be able to put in process the next component of its strategy to recover shareholder value. As stated in the 2008 Annual Report the Board believes that it would be detrimental to shareholder value for the Group to be wound up at the time of the continuation vote in May 2010. The Board therefore will shortly seek the endorsement of shareholders by bringing forward the continuation vote to autumn 2009 and will request an extension to the life of Company of three years from that time.
The Board believes such a strategy is in shareholders' interests as values of UK commercial property are unlikely to have substantially improved by May 2010. Although the economy is forecast to have stopped declining, economic recovery is likely to be slow and unemployment may be still increasing. Both these factors will slow the recovery of tenant demand and rental values. Market rental values are forecast to continue to fall in 2010 and 2011. In addition, the availability of debt finance for commercial property transactions is not expected to have materially improved. The Board believes that banks will still be struggling with historic bad debts and that this will affect a bank's ability to secure funding to facilitate new lending. Furthermore, the Board believes that banks' appetite for lending on commercial property transactions will have diminished as they seek to reduce their exposure on loans linked to commercial property. Discussions with banks indicate that they would be unwilling to lend on a portfolio of properties similar to those held by the Group at the current time. Were this to remain the case in May 2010 it would limit potential bidders for the Group's properties to equity purchasers, reducing competition and potentially the value which would be achieved for the Group's assets. Given this outlook, the Board remains of the opinion that shareholders would not vote for the dissolution of the Company and therefore the disposal of its property assets.
The Board is hopeful that the commercial property market will be showing some signs of recovery by 2012. Forecasts suggest that the rate of economic growth will have reverted to the levels enjoyed prior to the onset of the global financial crisis and subsequent recession. Unemployment is also expected to have peaked and be in decline. This, it is hoped, will feed through into a more positive outlook for occupancy rates and rental growth. The position of UK and international banks should also have improved by 2012. An improvement in the outlook for the occupier market may also further banks' willingness to lend to the sector which could improve liquidity in the transaction market and therefore increase the value of the Group's assets.
The potential for the wind up of the Company in 2010 creates instability and fetters the ability of the Company to take action to increase shareholder value. For example, the Company is unable to benefit from low interest rates if the Board has to work under the assumption that the Group will be wound up in 2010.
In addition to any value added by an improvement in the commercial property market between now and the extended deadline, the Board is also hopeful that shareholder value will increase for other reasons. Firstly, although dividend payments have been suspended, shareholder value is accruing as a result of surplus cash, after costs and interest payments, being used to reduce debt levels. This value would be realised by shareholders when the Group's properties are sold. Were the Group to be wound up at an earlier stage shareholders would not benefit from this additional income. Secondly, the Board is optimistic, as previously stated, of the ability of the Company's property managers to outperform in today's challenging occupier market.
DIRECTORS' REPORT
The directors present herewith the Interim Condensed Financial Statements of the Company and its subsidiaries (together "the Group") for the six months ended 30 June 2009.
The Company
The Company is an Isle of Man closed-ended investment company. The Company was incorporated on 10 June 2002 and its principal activity is that of investment in commercial property.
The directors confirm that:
no one property represents more than 15% of the gross assets of the Group;
income receivable from any one tenant, or tenants within the same group, in any one financial year does not exceed 20% of the total rental income of the Group;
at least 90% by value of properties are held in the form of freehold or long leasehold; and
the proportion of the Group's property portfolio which is unoccupied or not producing income or which is in the course of substantial redevelopment or refurbishment does not exceed 25% of the value of the portfolio.
Results and dividends
The consolidated loss after taxation of the Group for the six months ended 30 June 2009 amounted to £13,442,737 (31 December 2008: loss of £49,039,791, June 2008: loss of £14,952,729).
The Company paid no dividends during the Period having suspended dividends for the "D" Ordinary Share and Ordinary Share in October 2008 and January 2009 respectively.
Company Secretary
Martin Katz served as Secretary throughout the Period.
Going concern
The Directors confirm that the Group continues to be a going concern as it believes it has reasonable grounds to believe that its secured lenders are prepared to agree terms for the refinancing of the Group's secured loans.
Post balance sheet events
Negotiations are ongoing with the Group's lending banks with a view of refinancing the existing loan facilities following the breach of the LTV covenants by the Group as at 31 December 2008.
To date the Group has been offered credit approved continuation terms by Nationwide, which include a waiver of the LTV covenant for a period of time, subject to an upfront fee and increased margins. The Board expects that this refinancing should be signed and completed in the coming months.
Bank of Scotland has also indicated a willingness to offer a LTV waiver although the length of which is still to be agreed. Unfortunately the Group does not yet have a date for the application to go before the Lloyds Banking Group Credit team although the Board expects this to be approved in the coming months.
Auditors
In accordance with section 12(2) of the Companies Act 1982, Ernst & Young LLC have indicated their willingness to continue in office.
Jonathan Clague
Chairman
26 August 2009
CORPORATE GOVERNANCE STATEMENT
In December 1992, the Committee on the Financial Aspects of Corporate Governance ("the Cadbury Committee") published a Code of Best Practice. This was updated by the issue of The Combined Code: Principles of Good Governance and Code of Best Practice ("the Combined Code"). The Combined Code contains recommendations as to best practice, focusing on the control and reporting functions of boards of directors.
The Board of Close High Income Properties PLC, whilst not being under a formal obligation to report to the shareholders regarding the extent to which the Company complies with the Combined Code, monitors the Company's established procedures. The Board believes that the Company complies with the provisions of the Code to the extent which is appropriate to the Company's nature and scale of operations.
A revised version of the Combined Code has been adopted by the Financial Reporting Council ("The New Code") with effect from the Company's financial year commencing 1 January 2005. The Board is taking steps to ensure compliance with The New Code to the extent which it is appropriate and will report on this in its next annual report.
PROPERTY INVESTMENT ADVISER'S REPORT
Introduction
The first half of the 2009 has again proven to be a challenging period for the Group as the fallout from the recession in the "real economy" to the commercial property occupier market has materialised. Voids have increased as demand has fallen, renewal rates have declined and tenant default rates have also increased. The increase in void levels has been particularly marked amongst the Group's office properties, especially those occupied by tenants associated with larger groups. Demand for the Group's industrial properties has proved more resilient and, as a result, overall occupancy levels have remained comparatively stable.
We believe the asset management employed by the Group's property managers, the nature of the tenant mix and the low initial rents in many of the Group's properties should mitigate the impact of falls in prevailing market rents. With over 550 tenants, the Group's income is not overly exposed to any one single tenant. The Group's assets are also geographically diversified.
The Group's property managers have developed strong working relationships with most tenants and have been pro-active in working with occupiers whose financial positions have become strained in order to avoid tenant default where practicable. This has included allowing tenants to move from quarterly to monthly rental payments, payment plans and, where genuine hardship can be demonstrated, potential short term rent free periods.
Although the Company has benefited from the introduction of the one year concession for properties (or units within properties) with rateable values of up to £15,000 in April 2009, the effect of rising void levels on the Group's income has been compounded by the Government's previous reform of empty rates legislation.
In addition, the repercussions from the financial crisis have persisted, with debt finance for new commercial property transactions remaining scarce and banks only willing to lend on a much narrower range of assets. This has contributed to the Group's inability to dispose of any assets during the Period.
The Property Portfolios
Ordinary Share Property Portfolio
The Ordinary Share Property Portfolio consists of provincial industrial and office properties located throughout England.
Voids levels in the Ordinary Share Property Portfolio increased during the Period to June 2009. The office properties within the Ordinary Share Property Portfolio have been impacted in particular with low lease renewal rates, rising defaults and weak occupier demand. The Property Investment Adviser has, however, been encouraged by the resilience demonstrated by the Ordinary Share Property Portfolio's industrial assets, which account for 67% of the Ordinary Share Property Portfolio by value. As at 30 June 2009 the void level stood at 17.3% compared to 11.5% at 31 December 2008 and 7.1% at 30 June 2008.
No acquisitions or sales were made during the Period.
"D" Ordinary Share Property Portfolio
The "D" Ordinary Share Property Portfolio consists of nine courtyard style multi-tenanted office properties that were purchased in March 2006.
Void levels in the "D" Ordinary Share Property Portfolio remained broadly unchanged during the Period to June 2009 despite the difficult economic environment. This reflects improving tenant retention rates and the typical small size of tenants who, as with industrial occupiers, have proved more willing to renew
their leases. As at 30 June 2009 the void level stood at 19.1% compared to 15.6% at 31 December 2008 and 16.4% at 30 June 2008.
Significant progress has been made in relation to reducing the level of irrecoverable electricity and service charge costs incurred by this office portfolio. In addition, there is now an ongoing programme of separating electricity supplies to the individual units and negotiating with tenants to take over responsibility in return for a lower rent.
No acquisitions or sales were made during the Period.
Property classification by sector as at 30 June 2009
|
Classification by Sector |
Ordinary Share Portfolio (%) |
"D" Ordinary Share Portfolio (%) |
Total as a percentage of Market Value |
|
Industrial |
67 |
- |
54 |
|
Offices |
23 |
100 |
37 |
|
Mixed |
9 |
- |
8 |
|
Other |
1 |
- |
1 |
|
Total |
100 |
100 |
100 |
Property classification by region as at 30 June 2009
|
Region |
Ordinary Share Portfolio (% of Market Value) |
"D" Ordinary Share Portfolio (% of Market Value) |
Total as a percentage of Market Value |
|
Midlands |
29 |
37 |
31 |
|
East of England |
21 |
24 |
21 |
|
North East |
2 |
- |
2 |
|
North West |
10 |
25 |
13 |
|
South East |
9 |
- |
7 |
|
South West |
17 |
- |
14 |
|
Wales |
1 |
- |
1 |
|
Yorkshire & Humberside |
11 |
14 |
11 |
|
Total |
100 |
100 |
100 |
The table below summaries some of the property portfolio's key statistics as at 30 June 2009.
|
Ordinary Share Portfolio |
"D" Ordinary Share Portfolio |
|
|
2009 |
2009 |
|
|
Average annual rental per tenant |
£19,768 |
£19,707 |
|
Average length of lease remaining |
3.6 years |
3.7 years |
|
Average rental per square metre |
£57.07 |
£146.37 |
|
Largest tenant by rental value |
Scotts Ltd |
Bedfordshire County Council |
|
Longest unexpired lease term |
14.5 years |
11.5 years |
Schedule of Ordinary share properties as at 30 June 2009
|
Property |
Square Feet |
Location |
Value at 30 June 2009 |
Value at 30 June 2008 |
Value at 31 December 2008 |
|||||
|
* all freehold unless otherwise stated |
|
|
|
|||||||
|
Anglia Way, Mansfield |
20,459 |
Midlands |
800,000 |
955,000 |
870,000 |
|||||
|
Ashmead Industrial Estate, Keynsham |
38,301 |
South West |
1,600,000 |
2,190,000 |
1,700,000 |
|||||
|
Barbot Hall, Rotherham |
- |
Yorkshire & Humberside |
- |
2,750,000 |
- |
|||||
|
Bartlett Park, Yeovil |
23,465 |
South West |
1,180,000 |
1,420,000 |
1,300,000 |
|||||
|
Bellway Industrail Estate, Newcastle-upon-Tyne |
- |
North East |
- |
4,000,000 |
- |
|||||
|
Bumpers Way, Bumpers Farm, Chippenham |
11,203 |
South West |
570,000 |
630,000 |
560,000 |
|||||
|
Chilton Industrial Estate, Chilton, County Durham |
- |
430,000 |
- |
|||||||
|
Clarendon Court, Warrington |
36,526 |
North West |
2,050,000 |
2,850,000 |
2,200,000 |
|||||
|
Connaught Business Centre, Mitcham |
10,491 |
South East |
990,000 |
1,300,000 |
1,120,000 |
|||||
|
Elizabethan Way, Lutterworth |
14,272 |
Midlands |
570,000 |
700,000 |
620,000 |
|||||
|
Falcon Business Park, Burton-upon-Trent |
29,397 |
Midlands |
1,030,000 |
1,635,000 |
1,250,000 |
|||||
|
Farrington Place, Burnley |
41,511 |
North West |
1,550,000 |
1,880,000 |
1,680,000 |
|||||
|
Farthing Road Industrial Estate, Ipswich |
131,506 |
East |
4,000,000 |
5,750,000 |
4,650,000 |
|||||
|
Gainsford Drive, Halesowen |
14,546 |
Midlands |
560,000 |
725,000 |
630,000 |
|||||
|
Goodridge Avenue, Gloucester |
11,614 |
South West |
250,000 |
500,000 |
420,000 |
|||||
|
Greenfield Business Centre, Royston |
- |
South East |
- |
2,175,000 |
- |
|||||
|
Groundwell Farm Industrial Estate, Swindon |
92,599 |
South West |
4,100,000 |
5,200,000 |
4,325,000 |
|||||
|
Haines Park, Great Avenue, Leeds (long leasehold) |
13,143 |
Yorkshire & Humberside |
825,000 |
1,050,000 |
770,000 |
|||||
|
Henwood Business Park, Ashford |
- |
South East |
- |
2,350,000 |
- |
|||||
|
Ikon Trading Estate, Hartlebury |
160,168 |
Midlands |
4,920,000 |
6,550,000 |
5,650,000 |
|||||
|
Kirkleatham Industrial Estate, Redcar (long leasehold) |
- |
North East |
- |
2,740,000 |
- |
|||||
|
Links Estate, Weymouth |
31,304 |
South West |
1,210,000 |
1,530,000 |
1,270,000 |
|||||
|
Lowmoor Industrial Estate, Bradford |
24,858 |
Yorkshire & Humberside |
820,000 |
1,050,000 |
860,000 |
|||||
|
New England Industrial Estate, Hoddesdon |
22,479 |
South East |
1,000,000 |
1,230,000 |
1,100,000 |
|||||
|
Nightingale Road, Horsham |
23,182 |
South East |
1,200,000 |
1,550,000 |
1,350,000 |
|||||
|
North Seaton Industrial Estate, Ashington |
21,272 |
North East |
800,000 |
1,000,000 |
870,000 |
|||||
|
Oakhill Trading Estate, Leicester (long leasehold) |
- |
Midlands |
- |
2,000,000 |
- |
|||||
|
Peartree Lane, Dudley |
20,678 |
Midlands |
740,000 |
900,000 |
785,000 |
|||||
|
Portland Business Park, Handsworth, Sheffield (long leasehold) |
77,597 |
Yorkshire & Humberside |
2,500,000 |
3,250,000 |
2,800,000 |
|||||
|
Roseville Business Park, Roseville Road, Leeds (long leasehold) |
29,801 |
Yorkshire & Humberside |
1,410,000 |
1,825,000 |
1,500,000 |
|||||
|
Shadsworth Business Park, Blackburn |
34,060 |
North West |
1,550,000 |
2,000,000 |
1,750,000 |
|||||
|
Sheiling Court, Corby |
22,834 |
Midlands |
870,000 |
1,400,000 |
1,130,000 |
|||||
|
Smead Dean Centre, Sittingbourne |
33,857 |
South East |
1,550,000 |
2,350,000 |
1,750,000 |
|||||
|
Spire Road, Washington (long leasehold) |
18,772 |
North East |
830,000 |
1,020,000 |
900,000 |
|||||
|
St. James Mill, Millbrook, Northampton |
42,529 |
Midlands |
2,810,000 |
3,730,000 |
3,150,000 |
|||||
|
St Margarets Way, Huntingdon |
27,910 |
East |
1,700,000 |
2,100,000 |
1,800,000 |
|||||
|
Stadium Court, Cradock Road, Luton |
66,223 |
East |
2,500,000 |
4,050,000 |
3,100,000 |
|||||
|
Tewkesbury Business Park, Delta Drive, Tewkesbury |
59,580 |
South West |
2,000,000 |
3,890,000 |
2,650,000 |
|||||
|
Trinity Court, Warrington |
29,607 |
North West |
1,450,000 |
1,925,000 |
1,650,000 |
|||||
|
Units 13-15, Malmesbury Road, Cheltenham |
14,935 |
South West |
765,000 |
925,000 |
820,000 |
|||||
|
Units 16-25, Malmesbury Road, Cheltenham |
17,639 |
South West |
980,000 |
1,170,000 |
1,040,000 |
|||||
|
Units 5-7, Maxwell Road Industrial Estate, Peterborough |
61,339 |
East |
2,050,000 |
2,700,000 |
2,300,000 |
|||||
|
Units 20-25, Maxwell Road Industrial Estate, Peterborough |
60,051 |
East |
1,770,000 |
2,450,000 |
2,100,000 |
|||||
|
Walker Riverside, Newcastle |
- |
North East |
- |
3,420,000 |
- |
|||||
|
Wern Industrial Estate, Newport |
22,980 |
Wales |
700,000 |
1,050,000 |
780,000 |
|||||
|
Wren Industrial Estate, Maidstone (long leasehold) |
19,910 |
South East |
1,000,000 |
1,350,000 |
1,150,000 |
|||||
|
Wyther Lane, Leeds |
16,259 |
Yorkshire & Humberside |
760,000 |
950,000 |
800,000 |
|||||
|
Yale Business Park, Ipswich |
30,911 |
East |
1,380,000 |
1,680,000 |
1,530,000 |
|||||
|
Industrial properties total |
1,479,768 |
- |
59,340,000 |
100,275,000 |
66,680,000 |
|||||
|
Cleton Business Park, Tipton |
38,318 |
Midlands |
1,520,000 |
1,940,000 |
1,680,000 |
|||||
|
Rossendale Road Industrial Estate, Burnley |
44,973 |
North West |
1,250,000 |
1,480,000 |
1,350,000 |
|||||
|
Ryan and Leanne Business Park, Wareham (long leasehold) |
43,383 |
South West |
2,070,000 |
2,820,000 |
2,300,000 |
|||||
|
Webb Ellis Business Park, Rugby |
82,948 |
Midlands |
5,080,000 |
7,280,000 |
6,150,000 |
|||||
|
Industrial & Office properties total |
209,622 |
- |
9,920,000 |
13,520,000 |
11,480,000 |
|||||
|
Ascroft Court, Oldham |
14,000 |
North West |
865,000 |
1,040,000 |
930,000 |
|||||
|
Barshaw Business Park, Leicester |
21,000 |
Midlands |
1,700,000 |
2,600,000 |
1,850,000 |
|||||
|
Churchfield Court, Barnsley |
27,977 |
Yorkshire & Humberside |
3,350,000 |
3,720,000 |
3,200,000 |
|||||
|
Kendall House, Burgess Hill |
27,285 |
South East |
1,900,000 |
2,300,000 |
2,050,000 |
|||||
|
Marlborough House, Swindon |
8,921 |
South West |
400,000 |
750,000 |
600,000 |
|||||
|
Minerva Business Park, Peterborough (long leasehold) |
33,030 |
East |
2,170,000 |
3,850,000 |
2,800,000 |
|||||
|
Oak Tree Park, Redditch |
15,086 |
Midlands |
1,150,000 |
1,400,000 |
1,240,000 |
|||||
|
Preston Technology Centre, Preston |
- |
North West |
- |
4,660,000 |
- |
|||||
|
Priestly Court, Stafford (long leasehold) |
10,070 |
Midlands |
915,000 |
1,370,000 |
1,050,000 |
|||||
|
Vicarage Court, Edgbaston |
- |
Midlands |
- |
2,140,000 |
- |
|||||
|
Warwick House, Solihull |
15,470 |
Midlands |
2,700,000 |
3,760,000 |
3,000,000 |
|||||
|
Watermark Way, Hertford |
26,030 |
East |
2,520,000 |
3,580,000 |
2,950,000 |
|||||
|
Office properties total |
198,869 |
- |
17,670,000 |
31,170,000 |
19,760,000 |
|||||
|
Terminus Road, Eastbourne |
2,508 |
South East |
465,000 |
625,000 |
500,000 |
|||||
|
Retail properties total |
2,580 |
- |
465,000 |
625,000 |
500,000 |
|||||
|
Total value of Ordinary Share properties as at 30 June 2009 |
1,890,767 |
- |
87,395,000 |
145,590,000 |
98,330,000 |
|||||
Schedule of "D" Ordinary share properties as at 30 June 2009
|
Property |
Square Feet |
Location |
Value at 30 June 2009 |
Value at 30 June 2008 |
Value at 31 December 2008 |
|
* all freehold unless otherwise stated |
|
|
|
||
|
Appleton Court, Wakefield (long leasehold) |
26,100 |
Yorkshire & Humberside |
2,650,000 |
4,560,000 |
2,950,000 |
|
Basset Court, Northampton |
18,005 |
Midlands |
1,940,000 |
3,320,000 |
2,230,000 |
|
Dalton Court, Blackburn |
25,780 |
North West |
2,120,000 |
3,560,000 |
2,430,000 |
|
Faraday Court, Burton-upon-Trent |
25,487 |
Midlands |
2,550,000 |
3,710,000 |
2,880,000 |
|
Newton Court, Wolverhampton (long leasehold) |
23,781 |
Midlands |
1,960,000 |
3,300,000 |
2,120,000 |
|
Quays Reach, Salford |
13,116 |
North West |
1,350,000 |
2,200,000 |
1,510,000 |
|
Rutherford Court, Stafford (long leasehold) |
17,734 |
Midlands |
1,400,000 |
2,770,000 |
1,860,000 |
|
Stephenson Court, Bedford (long leasehold) |
42,260 |
East |
4,970,000 |
7,380,000 |
5,430,000 |
|
Whitworth Court, Runcorn, Cheshire |
25,773 |
North West |
1,840,000 |
3,400,000 |
2,310,000 |
|
Total value of "D" Ordinary share properties as at 30 June 2009 |
218,036 |
- |
20,780,000 |
34,200,000 |
23,720,000 |
|
Total value of properties as at 30 June 2009 |
2,108,803 |
- |
108,175,000 |
179,790,000 |
122,050,000 |
UK Economic and Commercial Outlook
The UK economy contracted by an estimated 2.4% in Q1 2009 which followed the 1.8% fall recorded in Q4 2008. Every sector of the economy bar government services declined in Q1 2009 while business investment, according to the Office of National Statistics, fell by 7.1% (Source: Office of National Statistics).
The first tentative signs of a turnaround in the economy have begun to emerge in recent months as a result of the sharp cuts in interest rates and the implementation of the Bank of England's quantitative easing programme. The availability of credit to the corporate sector has improved according to the Bank of England's Credit Conditions Survey and business confidence surveys indicate that service sector activity is improving. The housing market has shown signs of stabilisation with the Nationwide House Price Index recording house price appreciation in May and June 2009. The running down of inventories, which was a significant contributor to the economic declines in Q4 2008 and Q1 2009 appears to be coming to an end.
While it seems that the rate of economic decline is slowing, there is a great deal of difference between the economy no longer declining and it returning to more historic levels of growth. The risks remain on the downside. There are a number of factors, discussed below, which could slow the recovery process.
Consumer confidence, although rising, is weak and remains fragile. Households are expected to continue to rebuild their finances by paying down debt and increase savings over the medium term. The household savings rate, which fell into negative territory in 2008, rose to 4% in Q1 2009 and we believe the proportion of income households save will continue to rise. Household spending accounts for c.65% of UK GDP and the decision of households to reduce or slow the rate of spending will have repercussions for economic growth (Source: Office of National Statistics).
Although access to credit for businesses has improved slightly in recent months, it is questionable how much spare capacity lenders will have in order to facilitate a revival in private sector investment and whether this can offset the void left by those banks which are no longer open for new business. Government finances are also strained with the deficit due to rise in 2009/10 as a result of a reduction in tax receipts and an increase in social security spending as well as discretionary stimulus. It seems likely that, following an expected general election in 2010, a new government may have to make significant reductions in state spending in order to restore public finances to a more sustainable level.
These factors will combine to dampen domestic demand and may well mean that unemployment, which in March 2009 rose at its fastest level since 1991, will continue to rise (source: Office of National Statistics). The European Commission forecasts that unemployment will peak at c.10% in 2010 in the UK.
The recovery will be principally reliant on a recovery in the global economy and a resultant increase in UK exports, which should be assisted by the depreciation in the value of sterling. However, a recovery to the levels of economic growth witnessed in the years preceding the financial crisis is likely to be slow.
Oxford Economics forecasts negative growth of 4.1% in 2009 and a slight recovery in 2010 with growth of 0.1%. The International Monetary Fund is more pessimistic and forecasts negative growth in 2009 and 2010 of 4.1% and 0.4% respectively.
Commercial property values continued to decline during the first half of 2009 albeit at a slower rate than in 2008. According to the Investment Property Databank capital values have fallen by 44.1% between their peak in July 2007 and June 2009.
The drivers of the correction have evolved. Initially capital values declined as a result of an outward movement in commercial property yields, which reflected the serious problems in the debt markets and a subsequent re-risking of the sector by investors. Lately, negative rental growth and concerns over income security, following a sharp rise in tenant defaults, have become the predominant issue for investors and have been responsible for the majority of recent capital value declines. The Investment Property Forum's Consensus Survey forecasts cumulative rental declines of 24% between 2009 and 2011.
Transaction volumes fell sharply following the onset of the financial crisis in summer 2007 and have remained at low levels as investors have struggled to secure debt funding. This is likely to remain the case in the medium term as banks attempt to rectify issues with their outstanding loans and reduce their exposure to commercial property.
In common for investors and lenders alike, the concerns over the health of the occupier market and the risk posed by individual tenants has become central to the decision on whether to purchase or lend on an asset. Vacancy rates have increased as demand from occupiers has fallen away, space has been released from defaulting tenants (or those rationalising their portfolios) and new developments, commenced prior to the correction, have completed. The increase in supply and the reduction in tenant demand have altered the dynamic in letting negotiations. Tenants are now in a position where they are able to negotiate lower rents, more flexible lease terms and greater incentive packages.
Going forward
The Group remains in breach of the LTV covenants in its loan facilities with Nationwide and Bank of Scotland as at 30 June 2009. The Property Investment Adviser has kept both lending banks fully in formed of the Group's position since the breach occurred and is in ongoing discussions to establish an appropriate course of action. Nationwide has now provided credit approved terms for the restructuring of the loan agreement, which include a waiver of the LTV covenant for a period of time in exchange for an arrangement fee, an increase in the margin payable on the debt along with ongoing part repayments of the loan using all of the Group's surplus rental income. Bank of Scotland has indicated a willingness to offer similar terms although these terms remain subject to approval by Lloyds Banking Group Credit Team. The Board expects that both new facilities will be approved in the coming months. Once the loan facilities have been successfully negotiated, our primary focus remains in seeking ways to enhance the Group's income stream and to allow the Company to continue to trade and give the economy and property market time to stabilise.
Peter Roscrow
Close Investments Limited
Property Investment Adviser
26 August 2009
INDEPENDENT REVIEW REPORT
Interim condensed consolidated financial statements for the six months to 30 June 2009
Introduction
We have been engaged by the company to review the condensed set of financial statements in the half yearly financial report for the six months ended 30 June 2009 which comprises the consolidated income statement, consolidated balance sheet, consolidated statement of changes in equity, consolidated cash flow statement, the ordinary consolidated income statement, the ordinary consolidated balance sheet, the "D" ordinary consolidated income statement, the "D" ordinary consolidated balance sheet and the related notes 1 to 14. We have read the other information contained within the half yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
This report is made solely to the company in accordance with guidance contained in ISRE 2410 (UK and Ireland) "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our work, for this report, or for the conclusion we have formed.
Directors' Responsibilities
The half yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half yearly financial report in accordance Rules of the London Stock Exchange.
As disclosed in Note 2, the annual financial statements of the group will be prepared in accordance with International Financial Reporting Standards as adopted by the European Union. The condensed set of financial statements included in this half yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union. The accounting policies are consistent with those that the directors intend to use in the next financial statements.
Our responsibility
Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half yearly financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" Issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly we do not express an audit opinion.
Review conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial information in the half yearly financial report for the six month period to 30 June 2009 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Rules issued by the London Stock Exchange.
Emphasis of matter - going concern
In arriving at our review conclusion, which is not qualified, we have considered the adequacy of the disclosure made in note 1 to the half-yearly financial report, "Basis of Preparation", concerning the Group's ability to continue as a going concern. These conditions described in note 1 indicate the existence of material uncertainties which may cast significant doubt about the Group's ability to continue as a going concern. The half-yearly financial report does not include the adjustments that would result if the Group was unable to continue as a going concern.
Ernst & Young LLC
Chartered AccountantsDouglasIsle of Man
CONSOLIDATED INCOME STATEMENT
For the six month period from 1 January to 30 June 2009
|
(Audited) |
|||||||||
|
Notes |
30 June 2009 |
30 June 2008 |
31 December 2008 |
||||||
|
£ |
£ |
£ |
|||||||
|
INCOME |
|||||||||
|
Rental income from investment properties |
5,544,088 |
6,809,692 |
13,224,642 |
||||||
|
Other income |
10,500 |
79,994 |
132,334 |
||||||
|
5,554,588 |
6,889,686 |
13,356,976 |
|||||||
|
EXPENDITURE |
|||||||||
|
Property Investment Adviser's management fee |
(309,183) |
(704,296) |
(1,160,166) |
||||||
|
Property expenses |
(1,272,243) |
(1,359,280) |
(2,789,948) |
||||||
|
Other expenses |
(110,570) |
(243,116) |
(309,688) |
||||||
|
(1,691,996) |
(2,306,692) |
(4,259,802) |
|||||||
|
Gains/(Losses) from investments |
|||||||||
|
Realised gain/(loss) on disposal of investment properties |
- |
781,778 |
(1,414,701) |
||||||
|
Unrealised loss on revaluation of investment properties |
(14,630,153) |
(17,152,294) |
(50,044,066) |
||||||
|
(14,630,153) |
(16,370,516) |
(51,458,767) |
|||||||
|
Net operating loss for the period before finance costs |
(10,767,561) |
(11,787,522) |
(42,361,593) |
||||||
|
Unrealised gains on interest rate swaps |
393,632 |
- |
- |
||||||
|
Interest receivable |
7,847 |
585,315 |
624,510 |
||||||
|
Interest payable and similar charges |
(3,076,655) |
(3,750,522) |
(7,302,708) |
||||||
|
(2,675,176) |
(3,165,207) |
(6,678,198) |
|||||||
|
Net loss from ordinary activities before taxation |
(13,442,737) |
(14,952,729) |
(49,039,791) |
||||||
|
Taxation on ordinary activities |
4 |
- |
- |
- |
|||||
|
Net loss from ordinary activities after taxation attributable to members |
(13,442,737) |
(14,952,729) |
(49,039,791) |
||||||
|
Other comprehensive income |
(13,442,737) |
(14,952,729) |
(49,039,791) |
||||||
|
Cashflow hedges |
549,603 |
529,609 |
(5,365,121) |
||||||
|
Total comprehensive income for the period/(year) |
(12,893,134) |
(14,423,120) |
54,404,912 |
||||||
CONSOLIDATED BALANCE SHEET
As at 30 June 2009
|
(Audited) |
|||||||
|
Notes |
30 June 2009 |
30 June 2008 |
31 December 2008 |
||||
|
£ |
£ |
£ |
|||||
|
NON-CURRENT ASSETS |
|||||||
|
Fixed Investment properties |
5 |
108,175,000 |
179,790,000 |
122,050,000 |
|||
|
108,175,000 |
179,790,000 |
122,050,000 |
|||||
|
CURRENT ASSETS |
|||||||
|
Trade and other receivables |
6 |
2,004,396 |
4,395,086 |
3,590,798 |
|||
|
Cash and cash equivalents |
3,379,856 |
4,822,092 |
2,195,623 |
||||
|
5,384,252 |
9,217,178 |
5,786,421 |
|||||
|
Total assets |
113,559,252 |
189,007,178 |
127,836,421 |
||||
|
NON-CURRENT LIABILITIES |
|||||||
|
Bank loans |
8 |
- |
107,121,164 |
- |
|||
|
- |
107,121,164 |
- |
|||||
|
CURRENT LIABILITIES |
|||||||
|
Trade and other payables |
9 |
7,816,241 |
4,262,765 |
9,118,345 |
|||
|
Bank loans |
8 |
83,769,480 |
- |
83,851,411 |
|||
|
91,585,721 |
4,262,765 |
92,969,756 |
|||||
|
Total liabilities |
91,585,721 |
111,383,929 |
92,969,756 |
||||
|
CAPITAL AND RESERVES |
|||||||
|
Share capital |
- Ordinary |
10 |
747,259 |
747,259 |
747,259 |
||
|
- "D" Ordinary |
10 |
257,651 |
257,651 |
257,651 |
|||
|
- Deferred shares |
10 |
50,136 |
50,136 |
50,136 |
|||
|
Distributable capital reserve |
- Ordinary |
70,188,239 |
72,640,967 |
70,188,239 |
|||
|
- "D" Ordinary |
23,434,297 |
23,756,361 |
23,434,297 |
||||
|
Capital redemption reserve |
- Ordinary |
39,925 |
39,925 |
39,925 |
|||
|
Revenue reserves |
(68,350,236) |
(20,820,437) |
(54,907,499) |
||||
|
Hedge reserves |
11 |
(4,393,740) |
951,387 |
(4,943,343) |
|||
|
21,973,531 |
77,623,249 |
34,866,665 |
|||||
|
113,559,252 |
189,007,178 |
127,836,421 |
|||||
These financial statements were approved by the Board of Directors on 26 August 2009 and signed on its behalf by:
J D Clague
P P Scales
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six month period from 1 January to 30 June 2009
|
Share Capital |
Capital Reserve |
Capital Redemption Reserve |
Hedge Reserve |
Revenue Reserve |
Total |
|
|
As at 1 January 2008 |
1,055,046 |
97,909,559 |
39,925 |
421,778 |
(5,867,708) |
93,558,600 |
|
Net loss for the period |
- |
- |
- |
- |
(14,952,729) |
(14,952,729) |
|
Capital distributions |
- |
(1,512,231) |
- |
- |
- |
(1,512,231) |
|
Movement on unrealised gains on interest rate swaps |
- |
- |
- |
529,609 |
- |
(529,609) |
|
As at 30 June 2008 |
1,055,046 |
96,397,328 |
39,925 |
951,387 |
(20,820,437) |
77,623,249 |
|
Net loss for period |
- |
- |
- |
- |
(34,087,062) |
(34,087,062) |
|
Capital distributions |
- |
(2,774,792) |
- |
- |
(2,774,792) |
|
|
Movement on unrealised losses on interest rate swaps |
- |
- |
- |
(5,894,730) |
(5,894,730) |
|
|
As at 1 January 2009 |
1,055,046 |
93,622,536 |
39,925 |
(4,943,343) |
(54,907,499) |
34,866,665 |
|
Net loss for the period |
- |
- |
- |
- |
(13,442,737) |
(13,442,737) |
|
Movement in unrealised gains on revaluation of interest rate swaps |
- |
- |
- |
549,603 |
- |
549,603 |
|
As at 30 June 2009 |
1,055,046 |
93,622,536 |
39,925 |
(4,393,740) |
(68,350,236) |
21,973,531 |
CONSOLIDATED STATEMENT OF CASHFLOW
For the six month period from 1 January to 30 June 2009
|
(Audited) |
||||
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
||
|
£ |
£ |
£ |
||
|
Operating activities |
||||
|
Loss before tax |
(13,442,737) |
(14,952,729) |
(49,039,791) |
|
|
Adjustment to reconcile profit before tax to net cash flows |
||||
|
Decrease in value of investment properties |
14,630,153 |
17,152,294 |
50,044,066 |
|
|
Unrealised loss on interest swap |
(393,632) |
- |
- |
|
|
Realised (gain)/loss on sale of investment properties |
- |
(781,778) |
1,414,701 |
|
|
Finance income |
(7,847) |
(585,315) |
(624,510) |
|
|
Finance expense |
3,076,655 |
3,750,522 |
7,302,708 |
|
|
Amortised arrangement fees |
13,069 |
42,895 |
70,642 |
|
|
Decrease in debtors |
1,568,752 |
723,789 |
597,250 |
|
|
(Decrease)/increase in creditors |
(123,822) |
(1,869,702) |
104,736 |
|
|
Tax refunded |
- |
77,706 |
54,668 |
|
|
Net deposits (repaid)/received |
(256) |
2,901 |
(32,133) |
|
|
Net cash flows from operating activities |
5,320,335 |
3,560,583 |
9,892,337 |
|
|
Investing activities |
||||
|
Interest received |
7,847 |
585,315 |
624,510 |
|
|
Subsequent expenditure on properties |
(755,153) |
(1,206,755) |
(2,248,345) |
|
|
Proceeds from sale of properties |
- |
3,646,239 |
27,295,872 |
|
|
Net cash flows from investing activities |
(747,306) |
3,024,799 |
25,672,037 |
|
|
Financing activities |
||||
|
Dividends paid |
- |
(1,512,231) |
(6,291,408) |
|
|
Interest paid |
(3,293,796) |
(3,774,881) |
(7,303,665) |
|
|
Bank loans repaid |
(95,000) |
(1,185,000) |
(28,240,000) |
|
|
Bank loans drawn down |
- |
- |
3,750,000 |
|
|
Issue cost of long-term borrowing |
- |
(7,500) |
- |
|
|
Net cash flows from financing activities |
(3,388,796) |
(6,479,612) |
(38,085,073) |
|
|
Net increase/(decrease) in cash |
1,184,233 |
105,770 |
(2,520,699) |
|
|
Cash at 1 January |
2,195,623 |
4,716,322 |
4,716,322 |
|
|
Cash at 30 June/31 December |
3,379,856 |
4,822,092 |
2,195,623 |
|
ORDINARY SHARES
CONSOLIDATED INCOME STATEMENT
For the sixth month period from 1 January to 30 June 2009
|
(Audited) |
||||||||||
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
||||||||
|
INCOME |
£ |
£ |
£ |
|||||||
|
Rental Income from investment properties |
3(a) |
4,354,761 |
5,594,243 |
10,765,843 |
||||||
|
Other income |
10,500 |
74,112 |
122,631 |
|||||||
|
4,365,261 |
5,668,355 |
10,888,474 |
||||||||
|
EXPENDITURE |
||||||||||
|
Property Investment Adviser's management fee |
(262,416) |
(595,720) |
(976,566) |
|||||||
|
Property expenses |
(864,428) |
(941,714) |
(1,775,827) |
|||||||
|
Other expenses |
(83,965) |
(187,411) |
(245,770) |
|||||||
|
(1,210,809) |
(1,724,845) |
(2,998,163) |
||||||||
|
Losses from investments |
||||||||||
|
Realised gain/(loss) on disposal of investment properties |
3(c) |
- |
781,778 |
(1,414,701) |
||||||
|
Unrealised loss on revaluation of investment properties |
(11,620,541) |
(13,923,526) |
(36,224,532) |
|||||||
|
(11,620,541) |
(13,141,748) |
(37,639,233) |
||||||||
|
Net operating loss for the period before finance costs |
||||||||||
|
Unrealised gain on interest rate swaps |
393,632 |
- |
- |
|||||||
|
Interest receivable |
23,107 |
563,803 |
607,947 |
|||||||
|
Interest payable and similar charges |
(2,550,831) |
(3,194,145) |
(6,119,658) |
|||||||
|
(2,134,092) |
(2,630,342) |
(5,511,711) |
||||||||
|
Net loss from ordinary activities before taxation |
(10,600,181) |
(11,828,580) |
(35,260,633) |
|||||||
|
Taxation on loss of ordinary activities |
- |
- |
- |
|||||||
|
Net loss from ordinary activities after taxation attributable to members |
(10,600,181) |
(11,828,580) |
(35,260,633) |
|||||||
|
Other comprehensive income |
(10,600,181) |
(11,828,580) |
(35,260,633) |
|||||||
|
Cashflow hedges |
488,194 |
487,572 |
(5,188,471) |
|||||||
|
Total comprehensive income for period/year |
(10,111,987) |
(11,341,008) |
(40,449,104) |
|||||||
|
Basic and diluted earnings per "D" Ordinary Share (pence) |
(14.19) |
(15.83) |
(47.19) |
|||||||
ORDINARY SHARES
CONSOLIDATED BALANCE SHEET
As at 30 June 2009
|
(Audited) |
|||||||
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
|||||
|
£ |
£ |
£ |
|||||
|
NON-CURRENT ASSETS |
|||||||
|
Fixed investment properties |
87,395,000 |
145,590,000 |
98,330,000 |
||||
|
87,395,000 |
145,590,000 |
98,330,000 |
|||||
|
CURRENT ASSETS |
|||||||
|
Trade and other receivables |
2,395,980 |
3,468,067 |
3,669,049 |
||||
|
Cash and cash equivalents |
2,825,793 |
4,072,490 |
1,917,812 |
||||
|
5,221,773 |
7,540,557 |
5,586,861 |
|||||
|
Total assets |
92,616,773 |
153,130,557 |
103,916,861 |
||||
|
NON-CURRENT LIABILITIES |
|||||||
|
Bank loans |
- |
87,404,086 |
- |
||||
|
- |
87,404,086 |
- |
|||||
|
CURRENT LIABILITIES |
|||||||
|
Trade and other payables |
6,736,018 |
3,202,513 |
7,841,954 |
||||
|
Bank loans |
65,029,608 |
- |
65,111,773 |
||||
|
71,765,626 |
3,202,513 |
72,953,727 |
|||||
|
Total liabilities |
71,765,626 |
90,606,599 |
72,953,727 |
||||
|
CAPITAL AND RESERVES |
|||||||
|
Share capital |
747,259 |
747,259 |
747,259 |
||||
|
Deferred shares |
50,136 |
50,136 |
50,136 |
||||
|
Capital reserve |
70,188,239 |
72,640,967 |
70,188,239 |
||||
|
Revenue reserves |
(45,775,637) |
(11,743,403) |
(35,175,456) |
||||
|
Capital redemption reserve |
34,890 |
34,890 |
34,890 |
||||
|
Hedge reserves |
(4,393,740) |
794,109 |
(4,881,934) |
||||
|
20,851,147 |
62,523,958 |
30,963,134 |
|||||
|
92,616,773 |
153,130,557 |
103,916,861 |
|||||
"D" ORDINARY SHARES
CONSOLIDATED INCOME STATEMENT
For the sixth month period from 1 January to 30 June 2009
|
(Audited) |
||||||||||
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
||||||||
|
INCOME |
£ |
£ |
£ |
|||||||
|
Rental Income from investment properties |
3(b) |
1,189,327 |
1,215,449 |
2,458,799 |
||||||
|
Other income |
- |
5,882 |
9,703 |
|||||||
|
1,189,327 |
1,221,331 |
2,468,502 |
||||||||
|
EXPENDITURE |
||||||||||
|
Property Investment Adviser's management fee |
(46,767) |
(108,576) |
(183,600) |
|||||||
|
Property expenses |
(407,815) |
(418,263) |
(1,014,121) |
|||||||
|
Other expenses |
(26,605) |
(55,008) |
(63,918) |
|||||||
|
(481,187) |
(581,847) |
(1,261,639) |
||||||||
|
Losses from investments |
||||||||||
|
Unrealised loss on revaluation of investment properties |
3(d) |
(3,009,612) |
(3,228,768) |
(13,819,534) |
||||||
|
(3,009,612) |
(3,228,768) |
(13,819,534) |
||||||||
|
Net operating loss for the period before finance costs |
(2,301,472) |
(2,589,284) |
(12,612,671) |
|||||||
|
Interest receivable |
715 |
21,512 |
31,712 |
|||||||
|
Interest payable and similar charges |
(541,799) |
(556,377) |
(1,198,199) |
|||||||
|
(541,084) |
(534,865) |
(1,166,487) |
||||||||
|
Net loss from ordinary activities before taxation |
(2,842,556) |
(3,124,149) |
(13,779,158) |
|||||||
|
Taxation on loss of ordinary activities |
- |
- |
- |
|||||||
|
Net loss from ordinary activities after taxation attributable to members |
(2,842,556) |
(3,124,149) |
(13,779,158) |
|||||||
|
Other comprehensive income |
(2,842,556) |
(3,124,149) |
(13,779,158) |
|||||||
|
Cashflow hedges |
61,409 |
42,037 |
(176,650) |
|||||||
|
Total comprehensive income for period/year |
(2,781,147) |
(3,082,112) |
(13,955,808) |
|||||||
|
Basic and diluted earnings per "D" Ordinary Share (pence) |
(11.03) |
(12.13) |
(53.48) |
|||||||
"D" ORDINARY SHARES
CONSOLIDATED BALANCE SHEET
As at 30 June 2009
|
(Audited) |
|||||||
|
30 June 2009 |
30 June 2008 |
31 December 2008 |
|||||
|
£ |
£ |
£ |
|||||
|
NON-CURRENT ASSETS |
|||||||
|
Fixed Investment properties |
20,780,000 |
34,200,000 |
23,720,000 |
||||
|
20,780,000 |
34,200,000 |
23,720,000 |
|||||
|
CURRENT ASSETS |
|||||||
|
Trade and other receivables |
488,292 |
921,839 |
786,898 |
||||
|
Cash and cash equivalents |
554,063 |
749,602 |
277,811 |
||||
|
1,042,355 |
1,671,441 |
1,064,709 |
|||||
|
Total assets |
21,822,355 |
35,871,441 |
24,784,709 |
||||
|
NON-CURRENT LIABILITIES |
|||||||
|
Bank loans |
- |
19,717,078 |
- |
||||
|
- |
19,717,078 |
||||||
|
CURRENT LIABILITIES |
|||||||
|
Trade and other payables |
1,960,099 |
1,055,072 |
2,141,540 |
||||
|
Bank loans |
18,739,872 |
- |
18,739,638 |
||||
|
20,699,971 |
1,055,072 |
20,881,178 |
|||||
|
Total liabilities |
20,699,971 |
20,772,150 |
20,881,178 |
||||
|
CAPITAL AND RESERVES |
|||||||
|
Share capital |
257,651 |
257,651 |
257,651 |
||||
|
Capital reserve |
23,434,297 |
23,756,361 |
23,434,297 |
||||
|
Revenue reserves |
(22,574,599) |
(9,077,034) |
(19,732,043) |
||||
|
Capital redemption reserve |
5,035 |
5,035 |
5,035 |
||||
|
Hedge reserves |
- |
157,278 |
(61,409) |
||||
|
1,122,384 |
15,099,291 |
3,903,531 |
|||||
|
21,822,355 |
35,871,441 |
24,784,709 |
|||||
Related Shares:
IMPT.L