27th Sep 2006 07:01
Medsea Estates Group PLC27 September 2006 For immediate release 27 September 2006 MEDSEA ESTATES GROUP PLC ("Medsea or "the Company") Unaudited Interim Financial Results for the period ended 30 June 2006 Medsea Estates Group PLC, the AIM-listed Spanish-based estate agency group,announces unaudited interim results for the six months to 30 June 2006. HIGHLIGHTS •Pre-tax profits increased circa five and half times to £1.03m (2005:£179,000) •Turnover £5.27m (2005: £5.53m) •Earnings per share 0.96p •Expansion into Italy contributes to strong first half performance •Subsequently a strategic partnership signed with Saga in July Chairman Tony Gatehouse said: "The first half of the current year hasdemonstrated a substantial recovery following the downturn in the market lastyear with a profit before tax of £1.03m. There is no doubt that the Group hasregained its momentum, our expansion into the Italian market has beenexceptionally successful and the investment we made last year has contributedsignificantly to the improvement in the half year performance. The Group has continued to make good progress during the second half and I amparticularly excited about our strategic partnership with Saga as our partnership not only enables us to offer our services to millions of Saga customers but is also an endorsement of the quality of our services. The Board is encouraged by the progress made so far and looks forward to the rest of the year with confidence." For further information contact:Tony Gatehouse, Chairman, Medsea 0034 96 570 42Juan Carlos Rodriguez Martinez, Chief Executive, Medsea 0034 96 570 02 HB Corporate 0207 510 8600Imran Ahmad/Luke Cairns/Cecil Jordaan Weber Shandwick Square MileTerry Garrett/Alex White/John Moriarty 0207 067 0700 Notes to editorsMedsea Estates Group Plc is a leading Spanish-based estate agency group whichfloated on AIM in August 2004. It was established in 1998 to service themarketplace of the increasing number of UK and Irish nationals looking toacquire residential properties in Spain. Over the past six years the group has expanded to become one of the leadingagents within the area and now operates in a wide range of other Europeancountries including Italy, Portugal, Turkey, and Cyrpus. Medsea Estates Group PLC Unaudited Interim Results for the six months ended 30th June 2006 The first half of the current year has demonstrated a substantial recovery, withpre-tax profits rising circa five and half times to £1.03m. This is an extremelypleasing performance after the downturn in the market last year undermined oursales activities at a time when the Group was making significant investments inits core activities including important geographic expansion. I am pleased to report that the investments made last year, which expanded thegroup into important new regions such as Calabria in Italy, have resulted in asubstantial improvement in the half year performance. In the six months to 30June 2006 turnover of £5.27m (2005: £5.53m) was still marginally lower by some5% but the Group still managed to achieve a significant increase in operatingprofits and, coupled with a good performance from our associates, PromilorciS.l. and Bishop Properties S.l, pre-tax profits for the six months rose sharplyto £1.03m compared to £179,000 for the comparable period and a loss of £231,000for the second half of the year to 31 December 2005. After a taxation charge of £350,000, the net profit for the six months was £677,000, equivalent to earnings per share of 0.96p per share. There can be no doubt that the Group has regained its momentum. Aided by anever-increasing number of supporting agents in the UK, we are steadily regainingour share of the Spanish market. Since the beginning of the year, our offices inNorth and South Costa Blanca, Costa Almeria, Costa Tropical and Costa Calidahave sold 313 units, resulting in sales of €54.8m. We have also recentlyintroduced an innovative initiative called Easybuy, which eliminates the needfor British people, buying off-plan in Spain, to pay the 30/50% of the purchaseprice normally demanded within thirty days. This, we believe, will attract awhole new range of customers. Our move into the Italian market has been exceptionally successful. The initialcontract with Bella Calabria SRL in October last year was for 110 units. In Julythis year the contract was renewed for a five year period, giving us theopportunity to sell a minimum of 250 units per annum. With 345 sales alreadycompleted, we have already exceeded this minimum figure. We believe thedeal will generate sales for Medsea in excess of €4m annually. The end of July saw a major strategic partnership develop as the Group enteredinto a contract with Saga, the leading provider of holidays and financialservices for the over 50s market. This positions Medsea as key provider ofoverseas homes for Saga customers, giving it the opportunity to offer itsservices to millions of Saga customers. This is not only an important source offuture sales, it is an endorsement of the quality of our services. Since thebeginning of the second half, the Group has continued to make good progress andat the time of writing we are just beginning to see the first signs of buyingactivity coming from customers through our recently signed venture with Saga. We now have a good spread of properties across a number of key centres in Spain,Italy, Turkey, Portugal and Cyprus. It is too early to predict the outcome forthe full year but visitor levels remain encouraging, our conversion rate is goodand the Board looks forward to the rest of the year with confidence. Tony Gatehouse, Chairman27 September 2006 UNAUDITED INTERIM FINANCIAL INFORMATION OF MEDSEA ESTATES GROUP PLCFOR THE SIX MONTHS ENDED 30 JUNE 2006 The unaudited interim financial information for the six months ended 30 June2006 consolidates the results of Medsea Estates Group PLC and all of itssubsidiary undertakings at 30 June 2006. The unaudited interim financial information, which is the responsibility of thedirectors, does not constitute statutory accounts within the meaning of Section240 of the Companies Act 1985. CONSOLIDATED PROFIT AND LOSS ACCOUNT 6 months 6 months ended ended 30 June 30 June 2006 2005 (unaudited) (unaudited) Notes £'000 £'000 Turnover 2 5,267 5,526Costs of sales (3,858) (3,881) ----------- -----------Gross profit 1,409 1,645Administrative expenses (958) (1,461) ----------- -----------Operating profit 451 184Share of operating profit in associate 590 -Interest payable and similar charges (14) (5) ----------- -----------Profit on ordinary activities before taxation 1,027 179Taxation (350) (152) ----------- -----------Profit on ordinary activities after taxation 677 27Minority Interest 11 (16) ----------- -----------Retained profit for the period 688 11 =========== =========== All results derive from continuing operations of the Group. GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES 6 months 6 months ended ended 30 June 30 June 2006 2005 (unaudited) (unaudited) Notes £'000 £'000 Profit for the financial period 688 11 Foreign exchange gain/(loss) (13) (219) Unrealised surplus on revaluation of investment properties (34) - ----------- -----------Total recognised gains/(losses) relating to the year 641 (208) =========== =========== CONSOLIDATED BALANCE SHEET As at 30 As at 30 June June 2006 2005 (unaudited) (unaudited) Notes £'000 £'000 Fixed assetsIntangible assets 4 3Tangible assets 4 933 1,151Investments 7 91Investments in associates 827 - ----------- ----------- 1,771 1,245 Current assetsStock 309 156Debtors 5 8,769 7,875Cash at bank and in hand 555 615 ----------- ----------- 9,633 8,646 Creditors: amounts falling due within one year 6 (5,449) (4,813) ----------- -----------Net current assets 4,184 3,833 ----------- -----------Total assets less current liabilities 5,955 5,078 Creditors: amounts falling due in more than one year 7 (302) (129) Provisions for liabilities and charges 8 (1,147) (1,097) ----------- -----------Net assets 4,506 3,852 =========== ===========Capital and reservesCalled up share capital 9 7,063 7,063Share premium 22 22Minority interest (2) 17Revaluation reserve 62 92Other reserve 120 163Merger reserve (7,058) (7,058)Profit and loss account 4,299 3,553 ----------- -----------Equity shareholders' funds 4,506 3,852 =========== =========== CONSOLIDATED CASH FLOW STATEMENTS 6 months 6 months ended ended 30 June 30 June 2006 2005 (unaudited) (unaudited) Notes £'000 £'000 Net cash (outflow)/inflow from operating activities 10 (176) (271) Returns on investments and servicing of financeInterest element of finance lease payments (1) -Other interest paid (13) (5) ----------- -----------Net cash (outflow)/inflow from returns on investments and servicing of finance (14) (5) Taxation (70) (29) Capital expenditure and financial investmentPurchase of tangible fixed assets (14) (76)Proceeds from sale of tangible fixed assets 190 6 ----------- -----------Net cash flow from capital expenditure and financial investment 176 (70) Management of liquid resourcesAcquisition of other investments - (4) ----------- -----------Cash (outflow)/inflow before financing (84) (379) FinancingRepayment of other loans (41) (110)Repayment of long term loans - (118)Raising of long term loans 404 -Capital element of finance lease payments (4) (4) ----------- -----------Net cash inflow/(outflow) from financing 359 (232) ----------- -----------Increase/(decrease) in cash in the period 275 (611) =========== ===========Reconciliation of net cash flow to movement in net debtIncrease/(decrease) in cash in the period 275 (611)Cash (inflow)/outflow from increase in net debt and finance leasing (359) 232 ----------- -----------Movement in funds in the period (84) (379)Opening net funds/(debt) (228) 667 ----------- -----------Closing net (debt)/ funds 11 (312) 288 =========== =========== NOTES TO THE INTERIM FINANCIAL INFORMATION 1. Accounting policies The interim financial information has been prepared on the basis of theaccounting policies used for the year ended 31 December 2005. The interimfinancial results are unaudited. 2. Turnover Turnover derives wholly from the principal activity of the Group which iscarried out in the EU. 3. Intangible fixed assets Patents £'000CostAs at 1 January 2006 11Additions - -----------As at 30 June 2006 11 ----------- AmortisationAs at 1 January 2006 6Charge for the period 1 -----------As at 30 June 2006 7 ----------- Net book valueAs at 30 June 2006 4 ===========As at 31 December 2005 5 ===========4. Tangible fixed assets Office Freehold equipment land and Investment and motor buildings properties vehicles Total £'000 £'000 £'000 £'000Cost or valuationAs at 1 January 2006 257 449 678 1,384Additions - - 14 14Disposals - (160) - (160)Foreign exchange difference 2 1 3 6 --------- --------- --------- ---------As at 30 June 2006 259 290 695 1,244 ========= ========= ========= =========DepreciationAs at 1 January 2006 21 - 228 249Charge for the period 3 - 58 61Disposals - - - -Foreign exchange difference - - 1 1 --------- --------- --------- ---------As at 30 June 2006 24 - 287 311 ========= ========= ========= =========Net book valueAs at 30 June 2006 235 290 408 933 ========= ========= ========= =========As at 31 December 2005 236 449 450 1,135 ========= ========= ========= ========= 5. Debtors As at As at 30 June 30 June 2006 2005 £'000 £'000 Trade debtors 458 677Other debtors 1,439 553Prepayments and accrued income 6,872 6,645 --------- --------- 8,769 7,875 ========= ========= 6. Creditors: amounts falling due within one year As at As at 30 June 30 June 2006 2005 £'000 £'000 Bank loans and overdrafts 467 59Other loans 90 134Trade creditors 1,381 314Corporation tax 2 239Other taxation and social security 253 336Other creditors 31 215Accruals and deferred income 3,217 3,516Obligation under finance lease 8 --------- --------- 5,449 4,813 ========= ========= 7. Creditors: amounts falling due after more than one year As at As at 30 June 30 June 2006 2005 £'000 £'000 Bank loans 293 112Obligations under finance leases 9 17 --------- --------- 302 129 --------- --------- Analysis of loans - amounts repayable:In one year or less, or on demand 260 59Between one and two years 52 59Repayable between 2 and 5 years 241 53 --------- --------- 553 171In more than 5 years, repayable by instalments - - --------- --------- 553 171 ========= ========= The bank loans are secured on the freehold investment properties owned by theGroup, are repayable over twelve years by equal monthly instalments (or as thecorresponding properties are sold) and carry interest at 2% above the bank'sbase rate. 8. Provisions for liabilities and charges As at As at 30 June 30 June 2006 2005Deferred taxation: £'000 £'000 Provision at 1 January 794 1,042Charge for the period 353 55 --------- ---------Provision at 30 June 1,147 1,097 ========= ========= The provision for deferred taxation consists of the tax effects of timingdifferences in respect of income recognition. 9. Share capital As at As at 30 June 30 June 2006 2005 £'000 £'000Authorised:100,000,000 ordinary shares of 10 pence each 10,000 10,000 ========= =========Issued and fully paid:70,629,412 ordinary shares of 10 pence each 7,063 7,063 ========= ========= 10. Reconciliation of operating profit to operating cash flows 6 months 6 months ended ended 30 June 30 June 2006 2005 £'000 £'000 Operating profit 451 184Share of operating profit in associate 590 -Profit on disposal of fixed assets (62) -Foreign exchange (29) (162)Depreciation and amortisation 62 28(Increase)/decrease in debtors (2,642) (375)Increase/(decrease) in creditors 1,581 81(Increase)/decrease in stock (127) (27) --------- ---------Net cash inflow from operating activities (176) (271) ========= ========= 11. Analysis of changes in net debt 6 months 6 months ended ended 30 June 30 June 2006 2005 £'000 £'000 Cash at bank and in hand 156 1,229Bank Overdraft (83) -Finance leases (21) (29)Other loans (131) (244)Debt due within one year (54) (57)Debt due after one year (95) (232) --------- ---------Opening net funds/(debt) (228) 667 Increase/(decrease) in cash in the period 399 (614)(Increase)/decrease in overdrafts in the period (124) -Decrease/(increase) in finance leases in the period 4 4Decrease/(increase) in other loans 41 110(Increase)/decrease in debt due within one year (206) (2)(Increase)/decrease in debt due after one year (198) 120 --------- ---------Total movement in funds (84) (382) Cash at bank and in hand 555 615Bank Overdraft (207) -Finance leases (17) (25)Other loans (90) (134)Debt due within one year (260) (59)Debt due after one year (293) (112) --------- ---------Closing net funds/(debt) (312) 285 ========= ========= 12. Financial commitments At 30 June 2006 the Group had annual commitments under non-cancellable operatingleases as set out below: As at As at 30 June 30 June 2006 2005 £'000 £'000 Land and buildings:Expiring within one year 143 28Expiring in two to five years - 4 ========= ========= This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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