TIDMFPO
RNS Number : 9978G
First Property Group PLC
26 November 2015
Date: 26 November 2015
On behalf First Property Group plc ("First
of: Property" or "the Group")
Embargoed: 0700hrs
First Property Group plc
Interim Results for the six months to 30 September 2015
First Property Group plc (AIM: FPO), the property fund manager
and investor, today announces its interim results for the six
months to 30 September 2015.
Financial Highlights:
Unaudited Unaudited Percentage Audited
Six months Six months change Year
to to to
30 September 30 September 31 March
2015 2014 2015
---------------------------- -------------- -------------- ----------- ----------
Income Statement:
---------------------------- -------------- -------------- ----------- ----------
Statutory profit GBP5.93m GBP5.42m +9.4% GBP8.08m
before tax
Diluted earnings
per share 4.13p 4.07p +1.5% 6.93p
Dividend per share 0.385p 0.35p +10.0% 1.35p
Average EUR/ GBP
rate used 1.386 1.250 -10.9% 1.285
---------------------------- -------------- -------------- ----------- ----------
Balance Sheet at
period end:
---------------------------- -------------- -------------- ----------- ----------
Net assets GBP32.06m GBP26.62m GBP31.02m
Net assets per share 27.14p 22.72p 26.30p
Adjusted net assets
per share* 40.29p 26.15p 35.75p
Cash Balances GBP14.20m GBP12.05m GBP12.24m
Period-end EUR/ GBP
rate 1.357 1.283 1.382
---------------------------- -------------- -------------- ----------- ----------
Group Property Portfolio
at period end:
---------------------------- -------------- -------------- ----------- ----------
Group Properties** GBP125.9m GBP63.1m GBP126.9m
at book value
Group Properties** GBP145.3m GBP72.5m GBP142.0m
at market value
Gross Debt secured GBP108.3m GBP50.7m GBP107.8m
against Group
Properties
LTV% 74.5% 69.9% 75.9%
---------------------------- -------------- -------------- ----------- ----------
Total assets under GBP283m GBP333m
management: GBP327m
---------------------------- -------------- -------------- ----------- ----------
Poland 53.8% 66.9% 64.7%
United Kingdom 43.6% 30.5% 33.1%
Romania 2.6% 2.6% 2.2%
---------------------------- -------------- -------------- ----------- ----------
* Calculated according to EPRA triple net
valuation methodology, which includes adjustments
for fair values of i) financial instruments,
ii) debt, and iii) deferred taxes.
** Excludes the Group's non-controlling interests
in four other FPAM managed funds.
Operational Highlights and Explanatory Notes:
-- Interim dividend increased by 10% to 0.385 pence per share.
-- The contribution to Group profit before tax and unallocated
central overhead costs from Group
Properties increased to GBP5.22 million (2014: GBP2.97 million)
largely due to the contribution made by the
properties acquired in Poland and Romania by the Group and FOP
between July and December 2014.
-- The contribution to Group profit before tax and unallocated
central overhead costs from fund
management decreased to GBP1.19 million (2014: GBP2.90 million)
due to both reduced performance fees
earned by Fprop PDR and the expiry of our fund management
contract with USS. Fund management
fee income, excluding performance fees, is currently being
earned at the rate of some GBP1.3 million per
annum but should grow from here as we continue to invest the
SIPS mandate and as we win new
contracts.
-- Excluding the fair value adjustment, the impact of a weaker
Euro versus Sterling resulted in profit
before tax being cGBP512,000 lower.
Commenting on the results, Ben Habib, Chief Executive of First
Property Group, said:
"I am very pleased by the continued good progress made by the
Group.
"We are now reaping the rewards of the investments made by Fprop
Opportunities plc and ourselves over the last two years, which
contributed some GBP5.2 million to Group profit before tax in the
first half.
"We intend to continue to invest in high income generating
property, most likely in Poland and ideally in partnerships with
third parties. We are currently working on several such
opportunities.
"The visibility of our earnings into 2016 and beyond is good and
I look to the future with confidence."
A briefing for analysts will be held at 10:30hrs today at the
headquarters of First Property Group plc, 32 St James's Street,
London, SW1A 1HD. Participants can also attend by telephone on +44
(20) 7984 7578 (pin 617692). A copy of the accompanying investor
presentation can be accessed simultaneously at
http://www.fprop.com/plc-results/81/88/. A recorded copy of the
audio call will subsequently be posted on the company website,
www.fprop.com.
For further information please contact:
First Property Group plc Tel: 020 7340
0270
Ben Habib (Chief Executive www.fprop.com
& Chief Investment Officer)
George Digby (Group Finance
Director)
Jeremy Barkes (Director,
Business Development)
Arden Partners Tel: 020 7614
5900
Chris Hardie/ Ben Cryer
Redleaf Communications Tel: 020 7382
4747
Richard Gotla/ Henry Columbine firstproperty@redleafpr.com
Notes to Investors and Editors:
First Property Group plc is a property fund manager and investor
with operations in the United Kingdom and Central Europe. Its
earnings are derived from:
-- Fund management - via its FCA regulated and AIFMD approved
subsidiary, First Property Asset Management Ltd (FPAM), which earns
fees from investing for third parties in property:
o Management fees are levied by reference to the value of
properties under management;
o Performance fees are levied where appropriate, usually payable
upon realisation of profits above an agreed hurdle.
-- Group Properties - principal investments by the Group, to
earn a return on its own capital, usually in partnership with third
parties.
FPAM funds have ranked No.1 versus the Investment Property
Databank (IPD) Central & Eastern Europe (CEE) universe for the
annualised periods from the commencement of its operations in
Poland in 2005 to the end of each of the years between 31 December
2008 and 31 December 2014.
First Property Asset Management Limited is authorised and
regulated by the Financial Conduct Authority. Further information
about the Company and its products can be found at:
www.fprop.com.
CHIEF EXECUTIVE'S STATEMENT
Financial Results
I am pleased to report interim results for the six months ended
30 September 2015.
Revenue earned by the Group amounted to GBP10.95 million (2014:
GBP7.79 million) yielding a profit before tax of GBP5.93 million
(2014: GBP5.42 million). The increase in revenue and profit before
tax is largely attributable to the contribution made to earnings by
Group Properties, which benefitted from a full contribution during
the period from the six properties it acquired in Poland and
Romania between July and December 2014.
Diluted earnings per share were 4.13 pence (2014: 4.07
pence).
The Group ended the period with net assets of GBP32.06 million
(2014: GBP26.62 million). Its cash balance was GBP14.20 million
(2014: GBP12.05 million), of which GBP3.26 million (2014: GBP4.28
million) was held by Fprop Opportunities plc (76.2% owned by the
Group) and GBP461,000 (2014: GBP481,000) was held by Corp Sp z o,o.
(90% owned by the Group), the property management company for Blue
Tower in Warsaw.
Dividend
The Directors have resolved to increase the interim dividend by
10% to 0.385 pence per share (2014: 0.35 pence per share) which
will be paid on 31 December 2015 to shareholders on the register at
4 December 2015, with an ex-dividend date of 3 December 2015.
Review of Operations:
Property Fund Management - (First Property Asset Management Ltd
or FPAM)
As at 30 September 2015 aggregate assets under management,
calculated by reference to independent third party property
valuations, stood at GBP283 million (2014: GBP333 million),
including some GBP145.3 million (2014: GBP72.5 million) of
properties held by the Group and FOP. Of these 53.8% were located
in Poland, 43.6% in the UK and 2.6% in Romania. Fees are levied by
FPAM by reference to the value of funds under management excluding
cash.
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November 26, 2015 02:01 ET (07:01 GMT)
Revenue earned by this division reduced to GBP1.85 million
(2014: GBP3.55 million), resulting in a profit before tax and
unallocated central overhead costs of GBP1.19 million (2014:
GBP2.90 million). This represents 18.5% (2014: 49.4%) of Group
profit before tax and unallocated central overhead costs. The
reduction in revenue and profit before tax of this division is
attributable to a reduction in performance fees earned by Fprop PDR
with GBP0.86 million earned during the period (2014: GBP1.9
million), and the wind down and subsequent expiry in August of our
fund management contract with USS, which yielded GBP301,000 in fee
income during the period (2014: GBP908,000).
A synopsis of each of the funds managed by the Group as at 30
September 2015 is set out below:
Fund Country Established Fund Assets % of Assets
of investment expiry under total under
management assets management
at market under at market
value management value
at at
30 September 30 September
2015 2014
------------- --------------- ------------ -------- -------------- ------------ --------------
SAM Property UK Aug 2004 Rolling * * *
Company
Ltd (SAM)
Regional Poland Aug 2004 Aug GBP6.3m 2.2% GBP6.7m
Property 2020
Trading
Ltd (RPT)
5(th) Poland Dec 2004 Dec GBP7.8m 2.8% GBP8.5m
Property 2017
Trading
Ltd (5PT)
USS Fprop Poland Aug 2005 Aug Nil - GBP140.7m
Managed 2015
Property
Portfolio
LP
UK Pension UK Feb 2010 Feb GBP95.1m 33.7% GBP93.4m
Property 2017
Portfolio
LP (UK
PPP)
Fprop UK Oct 2013 May Nil (commitment - GBP11.2m
PDR LP 2018 of GBP42m)
SIPS UK Jan 2015 Jan GBP28.0m 9.9% Nil
Property 2025 (commitment
Nominee of GBP125m)
Ltd
---------- --- --------- ------ ---------------- ------ ----------
Sub Total GBP137.2m 48.6% GBP260.5m
---------------------------------- ---------------- ------ ----------
Fprop Poland Oct 2010 Oct GBP55.5m 19.6% GBP48.8m
Opportunities 2020
plc (FOP)
Group Poland n/a n/a GBP89.8m 31.8% GBP23.7m
Properties & Romania
(excluding
FOP)
--------------- ----------- --------- ------ ---------- ------ ---------
Sub Total GBP145.3m 51.4% GBP72.5m
----------------------------------------------- ---------- ------ ---------
Total GBP282.5m 100% GBP333.0m
------ ---------- ----- ----------
* Not subject to recent revaluation
Fprop PDR completed the sale of its last remaining property in
July, resulting in the Group earning a performance fee of GBP1.87
million, of which GBP0.86 million was recognised during the period
(2014: GBP1.9 million), with the balance having already been
recognised in the prior period. This fund ceased making new
investments in 2014.
We are making reasonable progress in investing the new SIPS
mandate, awarded to us in January. At 30 September the value of the
properties acquired stood at GBP28 million. Since the period end we
have exchanged contracts and completed the purchase of a further
GBP11 million of commercial property on its behalf, and we have a
further GBP32 million of property under offer.
Fund management fee income, excluding performance fees, is
currently being earned at a rate of some GBP1.3 million per annum.
We expect this rate to increase as we continue to invest the SIPS
fund and win more fund management contracts.
Group Properties
Group Properties comprise eleven commercial properties held by
the Group, including five held by FOP (in which the Group is a
76.2% shareholder), and non-controlling interests in four of the
seven funds managed by FPAM, as set out in the tables below. It is
the Group's policy to carry its investments at the lower of cost or
market value for accounting purposes, and to recognise dividends
when received.
Directly Held Properties at 30 September 2015:
Property No. Book Market Contribution Contribution
/ Country of properties value value to Group to Group
profit profit
before before
tax period tax period
to 30 to 30
September September
2015 2014
---------------- --------------- ---------- ---------- ------------- -------------
Poland 3 GBP69.9m GBP82.4m GBP2.79m GBP0.72m
Romania 3 GBP5.2m GBP7.4m GBP0.45m GBP1.31m*
FOP (Poland 5 GBP50.8m GBP55.5m GBP1.72m GBP0.80m
- consolidated
undertaking).
---------------- --------------- ---------- ---------- ------------- -------------
Total 11 GBP125.9m GBP145.3m GBP4.96m GBP2.83m
---------------- --------------- ---------- ---------- ------------- -------------
* Includes GBP1.123m of negative goodwill
arising from the refinancing of the subsidiary.
Non-controlling interests in funds managed by FPAM at 30
September 2015:
Fund % owned Book Current Group's Group's
by value market share share
First of First value of pre-tax of pre-tax
Property Property's of holdings profits profits
Group share earned earned
in by fund by fund
fund 30 September 30 September
2015 2014
----------- ---------- ------------ ------------- -------------- --------------
Interest in associates
5(th) 37.8% GBP530,000 GBP1,038,000 GBP59,000 GBP81,000
Property
Trading
Ltd (5PT)
Regional 28.6% GBP145,000 GBP193,000 GBP6,000 GBP26,000
Property
Trading
Ltd (RPT)
----------- ---------- ------------ ------------- -------------- --------------
Share of results GBP675,000 GBP1,231,000 GBP65,000 GBP107,000
in associates
Investments
UK Pension 0.9% GBP903,000 GBP903,000 GBP29,000 GBP30,000
Property
Portfolio
LP (UK
PPP)
Fprop 5% GBP13,000 GBP13,000 GBP163,000 Nil
PDR LP
----------- ----- ----------- ----------- ----------- ----------
Sub Total GBP916,000 GBP916,000 GBP192,000 GBP30,000
------------------ ----------- ----------- ----------- ----------
Total GBP1,591,000 GBP2,147,000 GBP257,000 GBP137,000
------ ------------- ------------- ----------- -----------
Revenue from Group Properties amounted to GBP9.10 million (2014:
GBP4.24 million), generating a profit before tax and unallocated
central overhead costs of GBP5.22 million (2014: GBP2.97 million).
This represents 81.5% (2014: 50.6%) of Group profit before tax and
unallocated central overhead costs.
The increase in profit before tax earned by Group Properties
resulted mainly from a full period contribution from the six
properties acquired by the Group and FOP in Poland and Romania
between July and December 2014, which amounted to GBP2.69 million
(2014: GBP162,000).
Commercial Property Markets Outlook
Poland:
GDP growth in Poland is forecast to be 3.5% in both 2015 and
2016.
In October's general election, the incumbent Civic Platform
Party (PO) was ousted by the conservative (but apparently less
business friendly) Law and Justice Party (PiS), to form Poland's
first non-coalition government since the fall of Communism. It has
pledged to use all available monetary and fiscal policy tools to
boost GDP growth towards 5%-6% per annum but has suggested the
introduction of new taxes on retailers and banks. It is also
expected to cut interest rates by 0.5% to 1% in the first quarter
of 2016.
The Polish Zloty/Euro exchange rate remains relatively stable at
around PLN 4.1-4.3, as it has been for several years. However, the
Sterling/Euro rate has weakened by some 20 per cent since 2013.
Rents for offices in Warsaw have fallen in recent years due to
the large development pipeline but appear to have now stabilised.
Rents and occupancy levels for other asset classes remain broadly
stable.
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Investment demand is mainly from German, US and UK investors and
is focused on prime properties of large lot sizes. The transaction
volume for 2015 is expected to exceed EUR3 billion, a level similar
to that of 2014.
United Kingdom:
GDP is now 5.9% above the pre-crisis peak reached in the first
quarter of 2008 and the rate of GDP growth is forecast to average
2-3% over the next couple of years.
The growth in the economy is likely to continue the trend of
increased occupational demand and increasing rents.
Investor demand remains buoyant, although there is a growing
market expectation that yield stabilisation is approaching, with
future gains expected from rental growth. According to IPD the
average net initial yield for all commercial property is now back
to its 2007 peak of 4.9%, with the implied equivalent yield (after
taking into account reversionary rent levels) at 5.9%.
The temporary extension to Permitted Development Rights for the
automatic conversion of offices to residential use has been made
permanent, although we still await details of the terms on which
this extension has taken place.
Current Trading and Prospects
I am very pleased by the continued good progress made by the
Group.
We are now reaping the rewards of the investments made by Fprop
Opportunities plc and ourselves over the last two years, which
contributed some GBP5.2 million to Group profit before tax in the
first half.
We intend to continue to invest in high income generating
property, most likely in Poland and ideally in partnership with
third parties. We are currently working on several such
opportunities.
The visibility of our earnings into 2016 and beyond is good and
I look to the future with confidence.
Ben Habib
Chief Executive
26 November 2015
CONDENSED CONSOLIDATED INCOME STATEMENT
for the six months to 30 September 2015
Notes Six months Six months Year to
to to 31 March
30 Sept 30 Sept 2015
2015 2014 (unaudited) (audited)
(unaudited)
Total results Total results
Total GBP'000 GBP'000
results
GBP'000
Revenue 2 10,947 7,785 18,523
------------------------------ ------ ------------- ------------------ ---------------
Cost of sales (1,773) (910) (3,156)
Gross profit 9,174 6,875 15,367
Recognition of negative
goodwill on
refinancing of subsidiary - 1,123 1,123
Recognition of negative
goodwill on the
acquisition of subsidiaries - - 716
Fair value adjustment
to investment
properties 556 (89) (876)
Operating expenses (2,609) (1,726) (6,925)
Operating profit 2 7,121 6,183 9,405
Share of results
in associates 65 107 185
Distribution income 192 30 694
Interest income 69 35 145
Interest expense (1,518) (934) (2,346)
Profit before tax 2 5,929 5,421 8,083
Tax credit /(charge) 3 (661) (433) 328
------------------------------ ------ ------------- ------------------ ---------------
Profit for the period 5,268 4,988 8,411
Attributable to:
Owners of the parent 4,888 4,792 8,172
Non-controlling interest 380 196 239
5,268 4,988 8,411
Earnings per Ordinary
1p share
-basic 4 4.28p 4.24p 7.21p
-diluted 4 4.13p 4.07p 6.93p
------------------------------ ------ ------------- ------------------ ---------------
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
for the six months to 30 September 2015
Notes Six months Six months Year to
to 30 to 31 March
Sept 2015 30 Sept 2015
2014
unaudited unaudited audited
----------------------------------- ------- ----------- ----------- ----------
GBP'000 GBP'000 GBP'000
----------------------------------- ------- ----------- ----------- ----------
Profit for the period 5,268 4,988 8,411
-------------------------------------------- ----------- ----------- ----------
Other comprehensive
income
Exchange difference
on retranslation of
foreign subsidiaries (3,161) (1,091) 272
Revaluation of available-for-sale
financial assets 13 43 37
Taxation - - -
Total comprehensive
income for the period 2,120 3,940 8,720
-------------------------------------------- ----------- ----------- ----------
Total comprehensive
income for the period: 2,130 4,007 8,505
Owners of the parent (10) (67)
Non-controlling interest
-------------------------------------------- ----------- -----------
215
------------------------------------------- ----------- ----------- ----------
2,120 3,940 8,720
------------------------------------------- ----------- ----------- ----------
CONDENSED CONSOLIDATED BALANCE SHEET
as at 30 September 2015
Notes As at As at As at
30 Sept 30 Sept 31 March
2015 2014 (unaudited) 2015 (audited)
(unaudited) GBP'000 GBP'000
GBP'000
------------------------------ ------ ------------- ------------------ ----------------
Non-current assets
Goodwill 153 153 153
Investment properties 5 112,956 51,026 114,262
Property, plant and
equipment 162 53 43
Interest in associates 6a 675 707 671
Other financial assets 6b 916 2,400 1,531
Other receivables 7 228 349 283
Deferred tax assets 4,100 846 3,803
------------------------------ ------ ------------- ------------------ ----------------
Total non-current
assets 119,190 55,534 120,746
Current assets
Inventories - land
and buildings 12,958 12,170 12,639
Current tax assets 52 55 236
Trade and other receivables 7 5,378 3,565 5,744
Cash and cash equivalents 14,202 12,048 12,240
------------------------------ ------ ------------- ------------------ ----------------
Total current assets 32,590 27,838 30,859
Current liabilities
Trade and other payables 8 (6,398) (2,894) (8,134)
Financial liabilities 9 (6,101) (2,172) (11,788)
Current tax liabilities (162) (242) (108)
------------------------------ ------ ------------- ------------------ ----------------
Total current liabilities (12,661) (5,308) (20,030)
------------------------------ ------ ------------- ------------------ ----------------
Net current assets 19,929 22,530 10,829
------------------------------ ------ ------------- ------------------ ----------------
Total assets less
current liabilities 139,119 78,064 131,575
------------------------------ ------ ------------- ------------------ ----------------
Non-current liabilities
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Financial liabilities 9 (104,061) (50,486) (97,925)
Deferred tax liabilities (3,003) (962) (2,631)
Net assets 32,055 26,616 31,019
------------------------------ ------ ------------- ------------------ ----------------
Equity
Called up share capital 1,149 1,149 1,149
Share premium 5,508 5,503 5,505
Foreign Exchange Translation
Reserve (3,389) (1,742) (618)
Investment revaluation
reserve (36) (43) (49)
Share-based payment
reserve 218 218 203
Retained earnings 27,547 20,718 23,735
------------------------------ ------ ------------- ------------------ ----------------
Equity attributable
to the owners of the
parent 30,997 25,803 29,925
Non-controlling interest 1,058 813 1,094
------------------------------ ------ ------------- ------------------ ----------------
Total equity 32,055 26,616 31,019
------------------------------ ------ ------------- ------------------ ----------------
Net assets per share 4 27.14p 22.72p 26.30p
------------------------------ ------ ------------- ------------------ ----------------
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
for the six months to 30 September 2015
Share Share Retained TOTAL
capital premium Share Foreign Investment Earnings Non-controlling
Based Exchange Purchase/Sale Revaluation Interest
Payment Translation of own Shares Reserve
Reserve Reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
At 1 April 2014 1,149 5,498 203 (914) (310) (86) 17,027 895 23,462
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
Profit for the
period
Fair value (or
revaluation)
gains on
available- for-
sale financial - - - (828) - - 4,988 (263) 3,897
assets to profit
or loss - - - - - 43 - - 43
Share based
payments - - 15 - - - - - 15
Non-controlling
interest - - - - - - (196) 196 -
Treasury shares - 5 - - 101 - - - 106
Dividends paid - - - - - - (892) (15) (907)
At 30 Sept 2014 1,149 5,503 218 (1,742) (209) (43) 20,927 813 26,616
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
Profit for the
period - - - 828 - - 3,423 263 4,514
Fair value (or
revaluation)
gains on
available- for-
sale financial
assets to profit
or loss - - - - - (6) - - (6)
Movement on
foreign exchange - - - 296 - - - (24) 272
Share based
payments - - (15) - - - - - (15)
Non-controlling
interest - - - - - - (43) 43 -
Treasury Shares - 2 - - 36 - - - 38
Dividends paid - - - - - - (399) (1) (400)
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
At 1 April 2015 1,149 5,505 203 (618) (173) (49) 23,908 1,094 31,019
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
Profit for the
period
Fair value (or
revaluation)
gains on
available- for-
sale financial - - - - 5,268 - 5,268
assets to profit -
or loss - - - - 13 - - 13
Movement on
foreign exchange - - - (2,771) - - - (390) (3,161)
Share based
payments - - 15 - - - - - 15
Non-controlling
interest - - - - - - (380) 380 -
Treasury shares - 3 - - 66 - - - 69
Dividends paid - - - - - - (1,142) (26) (1,168)
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
At 30 Sept 2015 1,149 5,508 218 (3,389) (107) (36) 27,654 1,058 32,055
------------------ -------- -------- -------- ------------ -------------- ------------ --------- ---------------- --------
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
for the six months to 30 September 2015
Six months to Six months to 30 Sept 2014 (unaudited) Year to
30 Sept 2015 (unaudited) 31 March 2015
(audited)
GBP'000 GBP'000 GBP'000
-------------------------------------------------------------- ------- --------------------------- --------------------------------------- ---------------
Cash flows from operating activities Notes
Operating profit 7,121 6,183 9,405
Adjustments for:
Depreciation of investment property, and property, plant & equipment 815 17 384
Fair value adjustment to investment properties (556) 89 876
Negative goodwill - (1,123) (1,839)
Share based payments 15 15 -
(Increase)/decrease in inventories (141) (70) (258)
(Increase)/decrease in trade and other receivables 307 664 (486)
Increase/(decrease) in trade and other payables (1,230) (2,406) 577
Other non-cash adjustments 43 26 84
Cash generated from operations 6,374 3,395 8,743
Income taxes paid (357) (322) (826)
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
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November 26, 2015 02:01 ET (07:01 GMT)
Net cash flow from operating activities 6,017 3,073 7,917
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Cash flow from investing activities
Purchase of investments - (651) (353)
Capital expenditure on investment properties (1,009) (38) (383)
Proceeds from partial disposal of available-for-sale assets 627 - 565
Purchase of property, plant and equipment (125) (6) (14)
Cash paid on control/acquisition of new subsidiaries - (218) (4,638)
Cash and cash equivalents received on control/acquisition of new
subsidiaries - 437 3,055
Dividends from associates 62 75 189
Distributions received 192 30 694
Interest received 69 35 145
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Net cash flow from /(used in) investing activities (184) (336) (740)
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Cash flow from financing activities
Net repayment of shareholder loans in subsidiaries (48) (245) (293)
Interest paid (1,462) (905) (2,266)
Proceeds from bank loan 7,813 3,491 3,547
Repayment of finance lease/bank loans (9,015) (3,357) (5,776)
Sale of shares held in Treasury 69 106 144
Dividends paid (1,142) (892) (1,291)
Dividends paid to non-controlling interest (26) (15) (16)
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Net cash flow (used in) financing activities of continuing operations (3,811) (1,817) (5,951)
Net increase in cash and cash equivalents 2,022 920 1,226
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Cash and cash equivalents at the beginning of period 12,240 11,279 11,279
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Currency translation gains/(losses) on cash and cash equivalents (60) (151) (265)
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
Cash and cash equivalents at the end of the period 14,202 12,048 12,240
----------------------------------------------------------------------- --------------------------- --------------------------------------- ---------------
NOTES TO THE CONDENSED CONSOLIDATED RESULTS
for the six months ended 30 September 2015
1. Basis of Preparation
-- These interim condensed consolidated financial statements for the six months ended 30
September 2015 have not been audited or reviewed and do not
constitute statutory accounts
within the meaning of section 435 of the Companies Act 2006.
They have been prepared in
accordance with the Group's accounting policies as set out in
the Group's latest annual financial
statements for the year ended 31 March 2015 and are in
compliance with IAS 34 "Interim
Financial Reporting". These accounting policies are drawn up in
accordance with International
Accounting Standards (IAS) and International Financial Reporting
Standards (IFRS) as issued by
the International Accounting Standards Board and as adopted by
the European Union (EU).
-- The comparative figures for the financial year ended 31 March
2015 are not the statutory accounts for the financial year but are
abridged from those accounts prepared under IFRS which have been
reported on by the Group's auditors and delivered to the Registrar
of Companies. The report of the auditors was unqualified, did not
include references to any matter to which the auditors drew
attention by way of emphasis without qualifying their report and
did not contain a statement under section 498 (2) or (3) of the
Companies Act 2006.
-- These interim financial statements were approved by a
committee of the Board on 25 November 2015.
2. Segmental Analysis
Segment reporting six months to 30 September 2015
The parent holding company costs and related listing costs are
shown separately under unallocated central costs.
Property fund Group properties Group fund Unallocated central TOTAL
management properties ("FOP") overheads
GBP'000 GBP'000 GBP000 GBP'000 GBP'000
External revenue
1,845 6,099 3,003 - 10,947
1,845 6,099 3,003 - 10,947
Depreciation and
amortisation (13) (747) (55) - (815)
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Operating profit
Existing operations 1,188 3,952 2,471 (490) 7,121
Share of results in
associates - 65 - - 65
Dividend income - 192 - - 192
Interest income - 14 45 10 69
Interest expense - (721) (797) - (1,518)
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Profit/(loss) before
tax 1,188 3,502 1,719 (480) 5,929
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Analysed as:
Before performance
fees and related
items: 324 4,324 1,242 (480) 5,410
Performance fees 864 - - - 864
Realised foreign
currency loss - (105) (79) - (184)
Depreciation - (717) - - (717)
Fair value
adjustments to
investment
properties - - 556 - 556
Staff incentives - - - - -
Profit/(loss) before
tax 1,188 3,502 1,719 (480) 5,929
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Revenue for the six months to 30 September 2015 from continuing
operations consists of revenue arising in the United Kingdom 14%
(2014: 34%) and Central and Eastern Europe 86% (2014: 66%) and all
relates solely to the Group's principal activities.
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Segment reporting six months to 30 September 2014
Property fund Group properties Group fund Unallocated central TOTAL
management properties ("FOP") overheads
GBP'000 GBP'000 GBP000 GBP'000 GBP'000
External revenue 3,550 1,582 2,653 - 7,785
3,550 1,582 2,653 - 7,785
Depreciation and
amortisation (14) (3) - - (17)
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Operating profit
-existing operations 2,903 2,218 1,525 (463) 6,183
-share of results in
associates - 107 - - 107
-dividend income - 30 - - 30
-interest income - 7 13 15 35
-interest expense - (192) (742) - (934)
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Profit/(loss) before
tax 2,903 2,170 796 (448) 5,421
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Analysed as:
Before performance
fees and related
items: 792 1,047 1,085 (448) 2,476
Performance fees 2,111 - - - 2,111
Realised foreign
currency loss - - (200) - (200)
Recognition of
negative goodwill
on refinancing of
subsidiary - 1,123 - - 1,123
Fair value
adjustments to
investment
properties - - (89) - (89)
Staff incentives - - - - -
Profit/(loss) before
tax 2,903 2,170 796 (448) 5,421
--------------------- --------------------- ----------------- -------------------- --------------------- --------
Segment reporting year to 31 March 2015
Property fund management Group properties Group Unallocated central TOTAL
fund properties ("FOP") overheads
---------------------------------- ----------------- ------------------------ ------------------------ --------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------- -------- ----------------- ------------------------ ------------------------ --------
External revenue
-Existing operations 6,140 2,968 5,217 - 14,325
-Sale of inventory - - - - -
-Business acquisitions - 3,479 719 - 4,198
Total 6,140 6,447 5,936 - 18,523
------------------------- -------- ----------------- ------------------------ ------------------------ --------
Depreciation and
amortisation (18) (360) (6) - (384)
------------------------- -------- ----------------- ------------------------ ------------------------ --------
Operating profit 4,435 5,454 2,454 (2,938) 9,405
Share of results in
associates - 185 - - 185
Distribution income - 694 - - 694
Interest income - 36 89 20 145
Interest expense - (730) (1,616) - (2,346)
Profit/(loss) before tax 4,435 5,639 927 (2,918) 8,083
------------------------- -------- ----------------- ------------------------ ------------------------ --------
Analysed as:
Before performance fees
and related items 1,605 4,489 2,272 (963) 7,403
Recognition of negative
goodwill on refinancing
of subsidiary - 1,123 - - 1,123
Recognition of negative
goodwill on acquisition
of subsidiaries - 716 - - 716
Fair value adjustment to
investment properties - - (876) - (876)
Depreciation - (357) - - (357)
Performance fees 3,365 - - - 3,365
Staff incentives (535) (194) (184) (1,955) (2,868)
Realised foreign
currency gain/(loss) - (138) (285) - (423)
Profit/(loss) before tax 4,435 5,639 927 (2,918) 8,083
------------------------- -------- ----------------- ------------------------ ------------------------ --------
Assets - Group 1,633 84,478 58,522 6,301 150,934
Share of net assets of associates - 979 - (308) 671
Liabilities (289) (72,437) (45,666) (2,194) (120,586)
----------------------------------- ------ --------- --------- -------- ----------
Net Assets 1,344 13,020 12,856 3,799 31,019
----------------------------------- ------ --------- --------- -------- ----------
Assets, liabilities and costs that relate to Group central
activities (including free cash) have not been allocated to
business segments.
3. Tax Expense
The tax credit / (charge) is based on a combination of actual
current and deferred tax charged at an effective rate that is
expected to apply to the profits for the full year.
Sept 2015 Sept 2014 March 2015
---------- ---------- ---------- -----------
Current
tax (588) (339) (525)
Deferred
tax (73) (94) 853
---------- ---------- ---------- -----------
Total (661) (433) 328
---------- ---------- ---------- -----------
4. Earnings/NAV per share
The basic earnings per ordinary share is calculated on the
profit on ordinary activities after taxation and after
non-controlling interests on the weighted average number of
ordinary shares in issue, during the period.
Figures in the table below have been used in the
calculations.
Six months Six months Year
ended ended ended
30 Sept 30 Sept 2014 31 March
2015 2015
--------------------- ------------ -------------- ------------
Basic -
pence per Share 4.28p 4.24p 7.21p
Diluted -
pence per Share 4.13p 4.07p 6.93p
--------------------- ------------ -------------- ------------
Number Number Number
--------------------- ------------ -------------- ------------
Weighted average
number of ordinary
shares in issue
for basic 114,177,240 112,953,380 113,348,847
Share options 4,450,000 5,050,000 4,850,000
--------------------- ------------ -------------- ------------
Total for diluted 118,627,240 118,003,380 118,198,847
--------------------- ------------ -------------- ------------
GBP'000 GBP'000 GBP'000
--------------------- ------------ -------------- ------------
Basic earnings 4,888 4,792 8,172
Diluted earnings
assuming full
dilution 4,895 4,807 8,187
--------------------- ------------ -------------- ------------
Six months Six months Year
ended ended ended
30 Sept 30 Sept 2014 31 March
2015 2015
------------------- ----------- -------------- ----------
Net assets per
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