TIDMASH
RNS Number : 1408V
Ashley House PLC
26 January 2017
Ashley House plc
Interim Report 2016
Ashley House plc ("Ashley House" or the "Company"), the health
and community care property partner, today announces its interim
results for the six months ended 31 October 2016.
Highlights
Financial highlights
-- Company remains profitable in period.
-- Revenue in line with prior year at GBP10.7m (2015: GBP10.6m).
-- Statutory profit before taxation GBP0.8m (2015: GBP0.2m).
-- Adjusted profit before taxation GBP0.2m (2015: GBP0.4m).
-- Net debt GBP2.4m (2015: GBP2.6m).
Operating highlights
-- Government in consultation on funding for supported housing
which is expected to be positively resolved in 2017 but does
challenge timing of scheme delivery.
-- Award of GBP11.5m grant funding by the Homes and Communities
Agency for future Extra Care schemes with a further GBP7.5m for
other Ashley House schemes via partner.
-- Three schemes currently on site (2015: four) being Walton on
the Naze (Extra Care) and the Health schemes in Swansea &
Wivenhoe.
-- Completion of the Harwich Extra Care scheme in December 2016.
-- Total forward pipeline, on-site or appointed of 25 schemes
with GBP170.7m of revenue anticipated to be recognised (January
2016: 31 schemes GBP177.2m).
"The Board is pleased that the business remains profitable and,
whilst there are still challenges to overcome considers the
business is well placed to grow again in the near future."
Christopher Lyons, Chairman
Enquiries:
Ashley House plc 01628 600 340
Antony Walters
Jonathan Holmes
WH Ireland 0207 220 1666
(Nominated Adviser and broker to Ashley House plc)
Adrian Hadden
Nick Prowting
Chairman's Statement
I am pleased to advise that Ashley House has produced a profit
before tax for the six months to 31 October 2016 on a turnover in
line with the previous year.
In September last year we celebrated the Company's 25 year
anniversary and Ashley House continues to expand its product and
service offering, applying its skills and experience to the
development of health, housing and other community projects.
We continue to wait for full clarity on the Government's
proposal to top up housing benefit at a local level to fund
supported housing. A consultation process commenced in November
jointly commissioned by the Department for Communities & Local
Government and the Department for Work & Pensions. In its
introduction to the consultation document, the Government
reiterates that it is "committed to protecting and boosting the
supply of supported housing". We continue to work with our clients,
both Councils and Registered Providers, to find solutions to enable
at least some of our pipeline schemes to proceed whilst this
consultation continues.
This month's announcement by the Homes and Communities Agency of
grant funding for the next five years included Ashley House with
GBP11.5m of funding for five of our current schemes. In addition, a
Registered Provider partner has been awarded GBP7.5m for another
three of our schemes. The total of GBP19m of grant funding is a
strong indication of the progress the Company has made in this area
and of the real opportunity for the business to develop out these
schemes once the Government's position on social rents becomes
clear.
In each case the grant funding allows the rents to be around 20%
lower than they would have been and makes the schemes acceptable to
the Local Authority Housing Benefits team. It does not in itself
close the gap created by the capping of Housing Benefits to Local
Housing Allowance levels, but it should help unlock schemes. Having
successfully completed our Extra Care scheme in Harwich last month,
we remain on site with the scheme in Walton on the Naze which is
due to complete in the coming weeks.
We currently believe that three schemes in our Extra Care
pipeline will be able to reach contract before our year end thereby
qualifying for revenue recognition, although they all still require
Local Authority and partner board final approvals.
Whilst our existing products are much required, the Company will
continue to diversify in order to lessen the exposure to the risk
of Government making changes that affect the fundamental elements
of the business. As mentioned in my last statement in July, we
continue to work with a modular construction contractor through a
joint venture company in order to increase the speed and efficiency
of our existing build programmes. This is enabling us to tap into a
new range of products and development opportunities that utilise
our skills set and importantly start to move us away from a
reliance on Government funded schemes. We hope to be able to
announce more concerning this venture in the coming months.
In our Health segment we have commenced construction on two new
schemes, a fully integrated GP surgery and family centre complex in
Swansea and the redevelopment of an old school building into new
surgery premises in Wivenhoe, Essex. The diagnostics and treatment
centre in Durham will commence on site in the coming weeks. In
addition we continue to support our partners Integrated Pathology
Partnerships in their programme of creating new pathology
laboratories.
Results
The Company made a profit before taxation of GBP0.8m in the
first half of 2016/17 (2015/16: GBP0.2m) on revenue of GBP10.7m
(2015/16: GBP10.6m). The gross margin percentage generated was
lower than last year due to the increase in construction income
which typically has a lower margin than pre-construction income.
The adjusted profit before tax was GBP0.2m (2015/16: GBP0.4m). The
Company also reached agreement to cancel a significant historic
liability with the counterparty, enabling a stronger statutory
result to be achieved.
The ongoing Government consultation relating to funding for
supported housing means that a further complication is added to the
process of contracting on schemes. Subject to the timing risk on
some of our schemes as referred to above, the Board expects that
the Company will be profitable at the full year.
Net debt
The table below shows net debt of GBP2.4m at 31 October 2016
(2015: GBP2.6m). The Company's overdraft facility with Lloyds Bank
has recently been extended to GBP0.75m and renewed until 31
December 2017. As in previous periods all debt at the end of
October was secured on amounts incurred on scheme related
expenditure. This is largely land purchased for future schemes
which stood at GBP2.8m (2015: GBP2.8m) as shown in work in progress
at the end of October.
In December we announced the refinancing of our loan through a
facility with the related party, Invescare Limited. The management
of our cash resources continues to be an important aspect of the
business.
Unaudited Unaudited Audited
31 October 31 October 30 April
2016 2015 2016
GBP000 GBP000 GBP000
Cash in bank (476) 514 23
Loan on Scarborough
land (619) (797) (710)
Loan (1,300) (2,300) (1,300)
(2,395) (2,583) (1,987)
------------ ------------ -----------
Pipeline
Ashley House's pipeline as at January 2017 is shown in the table
below. The value of the stated pipeline has decreased from the
previous information published in July 2016 largely due to the
recognition of GBP10m of revenue from the pipeline in the
period.
Extra Care Health TOTAL
------------- -------------------------- ------------------------- --------------------------
No. Scheme No. Scheme No. Scheme
of Schemes value of Schemes value of Schemes value
to come to come to come
------------- ------------ ------------ ------------ ----------- ------------ ------------
On Site 1 GBP4.1m 2 GBP3.5m 3 GBP7.6m
------------- ------------ ------------ ------------ ----------- ------------ ------------
Appointed 16 GBP145.4m 6 GBP17.7m 22 GBP163.1m
------------- ------------ ------------ ------------ ----------- ------------ ------------
TOTAL 17 GBP149.5m 8 GBP21.2m 25 GBP170.7m
------------- ------------ ------------ ------------ ----------- ------------ ------------
Outlook
We continue to make good progress on schemes in our Extra Care
segment although this is not helped by delays caused by the
Government's consultation process. Despite this we continue to work
with our clients to find solutions to enable schemes to progress to
site. We continue to broaden the outlook of the business and once
this is achieved and the funding of supported housing is resolved
as expected, the Board considers that the opportunities for Ashley
House are very strong.
The Board is pleased that the business remains profitable and,
whilst there are still challenges to overcome considers the
business is well placed to grow again in the near future.
Christopher Lyons
25 January 2017
Condensed consolidated interim statement of comprehensive
income
Unaudited Unaudited Audited
6 months 6 months Year to
to to
31 October 31 October 30 April
2016 2015 2016
Note GBP000 GBP000 GBP000
Revenue 10,744 10,626 20,737
Cost of sales (9,059) (8,343) (15,944)
------------------------------------------------- ---- ---------- ---------- --------
Gross profit 1,685 2,283 4,793
Administrative expenses (1,269) (1,584) (3,226)
Depreciation and impairment (55) (185) (1,514)
Share of results of joint ventures 165 (42) 97
Other operating income - - 581
Exceptional adjustment 655 - -
Operating profit 1,181 472 731
Interest receivable - - 1
Interest payable (401) (234) (491)
Profit before taxation 780 238 241
Profit before taxation 780 238 241
Depreciation and impairment 55 185 1,514
Taxation included in share of results of joint
ventures - (14) (14)
Other operating income - - (581)
Exceptional adjustment (655) - -
Adjusted profit before tax* 180 409 1,160
------------------------------------------------- ---- ---------- ---------- --------
Tax credit - - 6
------------------------------------------------- ---- ---------- ---------- --------
Total comprehensive income for the period 780 238 247
------------------------------------------------- ---- ---------- ---------- --------
Basic and diluted profit per share 3 1.32p 0.41p 0.42p
------------------------------------------------- ---- ---------- ---------- --------
Basic and diluted earnings per share on Adjusted
PBT* 3 0.31p 0.70p 1.99p
------------------------------------------------- ---- ---------- ---------- --------
* Adjusted PBT = Profit before tax, depreciation, impairment,
other operating income and exceptional adjustments.
Condensed consolidated interim balance sheet
Unaudited Unaudited Audited
31 October 31 October 30 April
2016 2015 2016
GBP000 GBP000 GBP000
------------------------------- --------------------- ---------------------- --------
Non-current assets
Property, plant and equipment 106 155 129
Investments in joint ventures 764 2,087 785
Deferred tax asset 1,400 1,400 1,400
Other receivables 760 827 760
-------------------------------- --------------------- ---------------------- --------
3,030 4,469 3,074
------------------------------- --------------------- ---------------------- --------
Current assets
Work in progress 2,807 2,807 2,807
Trade and other receivables 6,687 5,129 5,616
Cash and cash equivalents - 514 23
-------------------------------- --------------------- ---------------------- --------
9,494 8,450 8,446
------------------------------- --------------------- ---------------------- --------
Total assets 12,524 12,919 11,520
-------------------------------- --------------------- ---------------------- --------
Current liabilities
Trade and other payables (5,303) (5,887) (5,450)
Bank borrowings and overdrafts (1,962) (1,537) (1,483)
Provisions (56) (31) (56)
(7,321) (7,455) (6,989)
------------------------------- --------------------- ---------------------- --------
Net current assets 2,173 995 1,457
Non current liabilities
Amounts falling due after
more than one year (433) (1,560) (527)
Long term provisions (128) (109) (171)
Total liabilities (7,882) (9,124) (7,687)
-------------------------------- --------------------- ---------------------- --------
Net assets 4,642 3,795 3,833
-------------------------------- --------------------- ---------------------- --------
Equity
Share capital 590 583 588
Share premium 59 - 43
Share-based payments reserve 21 29 10
Special reserve 3,248 3,491 3,248
Retained earnings 724 (308) (56)
-------------------------------- --------------------- ---------------------- --------
Total equity 4,642 3,795 3,833
-------------------------------- --------------------- ---------------------- --------
Condensed consolidated interim statement of changes in
equity
Share Share Share-based Special Retained Total
capital Premium payment reserve earnings equity
reserve
GBP000 GBP'000 GBP000 GBP000 GBP000 GBP000
------------------------------- ------- ------- ----------- ----------- ----------- ------
Balance at 1 May 2016 588 43 10 3,248 (56) 3,833
Total comprehensive income
for the year - - - - 780 780
Issue of shares to Ashley
House Share Incentive Plan 2 16 - - - 18
Share-based payments charge - - 11 - - 11
Balance at 31 October 2016 590 59 21 3,248 724 4,642
------------------------------- ------- ------- ----------- ----------- ----------- ------
Balance at 1 May 2015 583 - 22 3,491 (546) 3,550
Total comprehensive income
for the year - - - - 238 238
Share-based payments charge - - 7 - - 7
Balance at 31 October 2015 583 - 29 3,491 (308) 3,795
------------------------------- ------- ------- ----------- ----------- ----------- ------
Balance at 1 May 2015 583 - 22 3,491 (546) 3,550
Total comprehensive income
for the year - - - (243) 490 247
Issue of shares to Ashley
House Share Incentive Plan 5 43 - - - 48
Cancellation of previous share
option scheme - - (22) - - (22)
New share option scheme charge - - 10 - - 10
At 30 April 2016 588 43 10 3,248 (56) 3,833
------------------------------- ------- ------- ----------- ----------- ----------- ------
Condensed interim cash flow statement
Unaudited Unaudited Audited
6 months 6 months Year to
to to
31 October 31 October 30 April
2016 2015 2016
GBP000 GBP000 GBP000
------------------------------------------ ---------- ---------- --------
Operating activities
Profit before taxation 780 238 241
Adjustments for:
Share-based payments charge/(credit) 11 7 (12)
Depreciation and impairment 55 185 1,514
Share of results of joint ventures (165) 42 (97)
Dividends received from joint ventures 159 34 174
Acquisition of investment in joint
ventures and associates - (17) -
Interest received - - (1)
Interest paid 401 234 491
Operating cash flows before movements
in working capital 1,241 723 2,310
Decrease in work in progress - 1,489 1,489
Increase in trade and other receivables (1,071) (2,094) (2,514)
Decrease in trade and other payables (147) (368) (805)
(Decrease)/increase in provision (43) (8) 79
------------------------------------------ ---------- ---------- --------
Cash (used by)/from operations (20) (258) 559
Income tax paid - - 6
Interest receivable - - 1
Interest paid (401) (234) (491)
------------------------------------------ ---------- ---------- --------
Net cash (used by)/generated from
operating activities (421) (492) 75
Investing activities
Purchase of shares in joint venture - - (17)
Purchase of property, plant and
equipment (5) (64) (66)
Net cash used by investing activities (5) (64) (83)
Financing activities
Issue of ordinary shares 18 - 48
Proceeds from borrowings - 300 600
Repayment of borrowings (90) (86) (1,473)
------------------------------------------ ---------- ---------- --------
Net cash generated (used by)/generated
from financing activities (72) 214 (825)
Net decrease in cash and cash equivalents (498) (342) (833)
Cash and cash equivalents at beginning
of period 23 856 856
------------------------------------------ ---------- ---------- --------
Cash and cash equivalents at end
of period (475) 514 23
------------------------------------------ ---------- ---------- --------
Notes to the condensed consolidated interim financial
statements
1 Nature of operations
The principal activity of the Group is the supply of design,
construction management and consultancy, primarily working with
providers of healthcare and social care on infrastructure
developments from project inception to completion of construction
and beyond.
Ashley House's condensed consolidated interim financial
statements (the interim financial statements) are presented in
pounds sterling (GBP), which is also the functional currency of the
parent company. These interim financial statements were approved
for issue by the Board of directors on 25 January 2017.
The financial information set out in these interim financial
statements does not constitute statutory accounts as defined in
Section 434 of the Companies Act 2006. The Group's statutory
financial statements for the year ended 30 April 2016 have been
filed with the Registrar of Companies. The auditor's report on
those financial statements was unqualified and did not contain a
statement under Section 498(2) of the Companies Act 2006.
2 Basis of preparation
These interim financial statements are for the six months ended
31 October 2016. They have been prepared following the recognition
and measurement principles of IFRS. They do not include all of the
information required for full annual financial statement and should
be read in conjunction with the consolidated financial statements
of the Group for the year ended 30 April 2016.
These interim financial statements have been prepared on the
going concern basis, under the historical cost convention, except
for the revaluation of certain financial instruments which are
carried at fair value.
These interim financial statements have been prepared in
accordance with the accounting policies adopted in the last annual
financial statements for the year to 30 April 2016.
3 Earnings per share
The calculation of the basic earnings per share is based on the
profit attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the period.
Weighted
Adjusted average Per share
PBT* Profit number amount
6 months to 31 October 2016 GBP000 GBP000 of shares Pence
----------------------------------- -------- ------ ---------- ---------
Basic and diluted earnings per
share 780 58,932,721 1.32p
----------------------------------- -------- ------ ---------- ---------
Profit per share based on Adjusted
PBT* 180 58,932,721 0.31p
----------------------------------- -------- ------ ---------- ---------
Weighted
Adjusted average Per share
PBT* Profit number amount
6 months to 31 October 2015 GBP000 GBP000 of shares Pence
----------------------------------- -------- ------ ---------- ---------
Basic and diluted earnings per
share 238 58,319,755 0.41p
----------------------------------- -------- ------ ---------- ---------
Profit per share based on Adjusted
PBT* 409 58,319,755 0.70p
----------------------------------- -------- ------ ---------- ---------
Weighted
Adjusted average Per share
PBT* Profit number amount
Year to 30 April 2016 GBP000 GBP000 of shares Pence
----------------------------------- -------- ------ ---------- ---------
Basic and diluted profit per
share 247 58,355,706 0.42p
----------------------------------- -------- ------ ---------- ---------
Profit per share based on Adjusted
PBT* 1,160 58,355,706 1.99p
----------------------------------- -------- ------ ---------- ---------
* Adjusted PBT = Profit before taxation, depreciation,
impairment other operating income.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DELFLDFFLBBV
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