RNS Number:7943P
International Real Estate Plc
16 September 2003



                        INTERNATIONAL REAL ESTATE ANNOUNCES

                                  INTERIM RESULTS



International Real Estate Plc, ("IRE" or "the Company"), has today announced its
interim results for the six months to 30 June 2003.


  * Profits on ordinary activities before taxation of Euro50,000 (2002: Euro628,000)
  * Disposal of 36,288 square metre warehouse and office property in
    Aartselaar near Antwerp, Belgium for Euro11.314 million. The addition to
    shareholders' funds was Euro446,000 and led to a cash contribution of Euro5.6
    million for the Group.
  * Net Asset Value at 30 June 2003 of Euro2.60 per share (31 December 2002:
    Euro2.62 per share)
  * Net Asset Value including unrecognised trading stock value would be Euro3.88
    per share before tax (31 December 2002 Euro4.07 per share) or Euro3.43 net of
    taxes (31 December 2002: Euro3.56)
  * Net borrowings at 30 June 2003 reduced to Euro34.256m (31 December 2002:
    Euro43.885m)
  * Interim dividend of 3.0 pence (4.4 eurocents) (30 June 2002: 3.0 pence or
    4.8 eurocents)



Commenting on the results, Rolf L Nordstrom, Chairman, said:

"We are pleased with the disposal of the Aartselaar property, which has
generated a useful profit and led to the addition of Euro446,000 to shareholder's
funds and a cash contribution of Euro5.6 million.

"The ongoing litigation with Stratford UK Properties LLC ("Oaktree") is
continuing. However, we are encouraged by the positive legal advice received and
the fact that the Company was granted leave to appeal to the House of Lords.

"The outlook for the second half of the year is difficult to project. It will
depend largely on whether the outcome of the Appeal to the House of Lords has
been decided, developments relating to the Basingstoke property and other
property disposals or purchases during the period."

Daniel Akselson, CEO, commented:

"Our major property assets in central Brussels are continuing to perform well
despite the challenging letting market. Encouragingly, recent lettings have been
secured at record levels that continue to improve."



                                     -ends-

Date: 16 September 2003

For further details contact:
International Real Estate Plc                        City Profile Group
Tel: 00 44 (0) 20 7839 8686                          Simon Courtenay

Rolf L Nordstrom, Chairman                           Tel: 00 44 (0) 20 7448 3244

Mobile: 00 44 (0) 7776 137 400
Daniel Akselson, Chief Executive
Mobile: 00 31 (0)653 30 4590
e-mail:info@IREplc.com



INTERNATIONAL REAL ESTATE PLC

Chairman's Statement

The Interim Report and Accounts to 30 June 2003 reflect the refocused Group with
the majority of its operations now located in Belgium.

Currently the main activity of the Group is related to its two trading
properties in Belgium - the IT Tower and QPT Tower office blocks in Brussels.

The effects of the slowdown in economic activity have been less of a problem for
the Brussels property market, compared to most other European capitals. Whilst
the investment market remains very strong Brussels has had some problems,
especially with the office letting market. During the current period several
property acquisitions were considered and a number are being analysed.

With respect to the IT Tower, the 22,778 square metre landmark office tower
situated on Avenue Louise, our main efforts have been focused on the letting
situation, the rolling refurbishment programme and the investment programme for
the communal areas.

The major parts of the investment programme are finished, in line with previous
plans and budgets.

To date we have been able to secure contracts for 2,660 square metres at rental
levels between Euro180 and Euro190, an improvement on previous levels. The full effect
of these lettings will not be realised until 2004, as a number of agreements are
for areas where the refurbishment works have not yet been completed or for space
that requires tenant fit out. The occupancy ratio, based on total square metres,
is 82% as at 16 September 2003.

Fully let, the property is forecast to produce rents of Euro4.32 million per annum,
giving a gross yield of 9.4% on cost including refurbishment.

The 11,255 square metre QPT Tower located at Quai aux Pierres de Taille in
Brussels is fully let to high quality tenants with an average length of leases
of more than 4 years

The property is producing rents of Euro1.07 million per annum, giving a gross yield
of 11.3% on cost.

On 4 April 2003, the Group sold the 36,288 square metre warehouse and office
property in Aartselaar near Antwerp, Belgium. The sale for Euro11.314 million
generated a profit before tax of Euro153,000. In addition previously provided
deferred tax under FRS 19 of Euro293,000 was no longer required. The addition to
shareholders' funds was Euro446,000, with a cash contribution of Euro5.6 million for
the Group. However the sale will result in a significant reduction in gross
rental income pending re-investment in property.

A full explanation of the ongoing litigation with our Joint Venture Partners,
Stratford UK Properties LLC ("Oaktree") and Mr Aubrey Glaser, the former
Managing Director, is included in Note 6 'Contingent liabilities' in the
attached Interim Accounts.

On the basis of legal advice received, the Board of Directors considers that the
Company is unlikely to incur any material loss as a result of the Oaktree
litigation and therefore no provision has been included in the accounts, however
the matter will be kept under review. The Company was granted leave to appeal to
the House of Lords.

The UK portfolio consists of the Limited Partnership property in Basingstoke, in
which the Group has a 25% interest. Note 10 explains the status of the limited
partnership and the fundamental uncertainties surrounding it.

The net asset value as at 30 June 2003 was Euro2.60 per share (31 December 2002:
Euro2.62 per share).

The net asset value including unrecognised trading stock value, would be Euro3.88
per share before tax (31 December 2002: Euro4.07 per share) or Euro3.43 net of taxes
(31 December 2002: Euro3.56)

As previously reported, the Company has implemented FRS 19 resulting in full
provision without discounting, for deferred taxes relating to its Belgian
operations at the current Belgian tax rate of 33.99%. During the period the sale
of the Company owning the Aartselaar property took place resulting in a net tax
credit for the period. However additional provisions for deferred tax are likely
to be required in the second half of the year.

Once there has been the appropriate change in legislation the Group intends to
only publish its annual accounts and interim statements on the Internet
(www.IREplc.com) in order to speed up distribution and to reduce costs.

The outlook for the second half of the year is difficult to project. It will
depend largely on whether the Appeal to the House of Lords has been decided,
developments relating to the Basingstoke property and the limited partnership
and other property disposals or purchases during the period.

The overall rental income is expected to be sufficient to cover our financing
costs and administrative expenses.

The Company's net borrowings at 30 June 2003 have reduced to Euro34.256 million
from Euro43.885 million at 31 December 2002 due to the sale of the Aartselaar
property.

The share price reflects a substantial discount to net asset value and your
Board of Directors continues to examine ways of reducing this discount.

The Board proposes to pay an interim dividend of 3.0 pence (4.4 eurocents) per
share (30 June 2002: 3.0 pence or 4.8 eurocents per share) partly out of
reserves, payable on 21 October 2003, to shareholders on the register on 24
September 2003. The Board will carefully review the level of the final dividend
based on the second half result.

I would like to take this opportunity to thank my fellow directors, Management
team and all of our staff and consultants who have worked so hard and diligently
during the period.



Rolf L Nordstrom, Chairman

16 September 2003








CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003
                                                                 Six month                 Six month
                                                              period ended              period ended          Year ended
                                                                30.06.2003                30.06.2002          31.12.2002
                                                    Note             Euro'000                     Euro'000               Euro'000
                                                                 Unaudited                 Unaudited             Audited
Turnover                                             2
Net rental income                                                    1,906                     2,713               5,133
Property sales                                                      11,314                         -                 285
________________________________________________________________________________________________________________________
                                                                    13,220                     2,713               5,418
Cost of sales                                                     (11,161)                         -                (80)
________________________________________________________________________________________________________________________
Gross Profit                                       3 (a)             2,059                     2,713               5,338
Exceptional charges - Litigation                   3 (b)              (38)                         -               (141)
Impairment in value of investment property         3 (b)                 -                         -               (139)
Other administrative expenses                                        (866)                     (997)             (1,959)
Total administrative expenses                                        (904)                     (997)             (2,239)
Other operating income                                                   -                         -                  58
________________________________________________________________________________________________________________________
Operating Profit and Profit on Ordinary
Activities before Interest and Taxation              2               1,155                     1,716               3,157
Interest receivable and similar income                                 128                       171                 299
Interest payable and similar charges                               (1,033)                   (1,259)             (2,355)
Movement in fair value of derivatives                                (200)                         -               (252)
Total interest payable                                             (1,233)                   (1,259)             (2,607)
________________________________________________________________________________________________________________________
Profit on Ordinary
Activities before Taxation                                              50                       628                 849
Tax credit / (charge) on profit on ordinary          4                 151                     (363)               (752)
activities
________________________________________________________________________________________________________________________
Profit on Ordinary Activities after Taxation                           201                       265                  97

and Profit for the Financial Period
________________________________________________________________________________________________________________________
Equity dividends                                                     (318)                     (354)               (697)
________________________________________________________________________________________________________________________
Retained Loss for the Financial Period                               (117)                      (89)               (600)
________________________________________________________________________________________________________________________
Basic and diluted earnings per share                 5               Euro0.03                    Euro 0.04              Euro 0.01


The results for the above periods reflect the continuing operations of the group.

There are no recognised gains or losses in any of the above periods other than 
the loss for the periods.




CONSOLIDATED BALANCE SHEET
AS AT 30 JUNE 2003
                                                              30.06.2003             30.06.2002               31.12.2002
________________________________________________________________________________________________________________________
                                                Note               Euro'000                  Euro'000                    Euro'000
Fixed Assets                                                   Unaudited              Unaudited                  Audited
Investment properties                            10                  957                  1,157                    1,017
Other tangible assets                                                 17                     66                       37
Investments                                                            2                      2                        2
________________________________________________________________________________________________________________________
                                                                     976                  1,225                    1,056
________________________________________________________________________________________________________________________
Current Assets
Stock - trading properties                       7                55,634                 63,367                   65,746
Debtors                                                            1,500                  1,726                    1,426
Cash at bank and in hand                                           6,412                  5,884                    2,806
________________________________________________________________________________________________________________________
                                                                  63,546                 70,977                   69,978
Current Liabilities
Creditors: amounts falling due
within one year
- Borrowings                                                       (965)                (1,433)                  (1,234)
- Other                                                          (4,075)                (4,401)                  (4,281)
________________________________________________________________________________________________________________________
                                                                 (5,040)                (5,834)                  (5,515)
________________________________________________________________________________________________________________________
Net Current Assets                                                58,506                 65,143                   64,463
________________________________________________________________________________________________________________________
Total Assets Less Current Liabilities                             59,482                 66,368                   65,519
Creditors: amounts falling due
after more than one year
- Borrowings                                                    (39,703)               (46,045)                 (45,457)
Provisions for liabilities and charges:
Deferred taxation                                                  (650)                  (566)                    (816)
________________________________________________________________________________________________________________________
Net Assets                                                        19,129                 19,757                   19,246
________________________________________________________________________________________________________________________
Capital and Reserves
Called up share capital                                            4,683                  4,683                    4,683
Share premium account                            8                 7,957                  7,957                    7,957
Capital redemption reserve                       8                   291                    291                      291
Profit and loss account                          8                 6,198                  6,826                    6,315
________________________________________________________________________________________________________________________
Equity Shareholders' Funds                                        19,129                 19,757                   19,246
________________________________________________________________________________________________________________________


RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003
                                                                           Six month         Six month        Year ended
                                                                        period ended      period ended        31.12.2002
                                                                          30.06.2003        30.06.2002
________________________________________________________________________________________________________________________
                                                              Note             Euro'000             Euro'000             Euro'000
Profit for the financial period                                                  201               265                97
Dividends                                                                      (318)             (354)             (697)
________________________________________________________________________________________________________________________
Net reduction in Shareholders' funds                                           (117)              (89)             (600)
Opening Shareholders' funds                                                   19,246            19,846            19,846
________________________________________________________________________________________________________________________
Closing Shareholders' funds                                                   19,129            19,757            19,246
________________________________________________________________________________________________________________________






CONSOLIDATED CASH FLOW STATEMENT
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2003
                                                                       Six month           Six month
                                                                    period ended        period ended          Year ended
                                                                      30.06.2003          30.06.2002          31.12.2002
________________________________________________________________________________________________________________________
                                                    Notes                  Euro'000               Euro'000               Euro'000
Net cash inflow from
operating activities                                9 (a)                  5,403               2,166                 936
Returns on investments and
servicing of finance
Interest paid                                                            (1,033)             (1,121)             (2,272)
Interest received                                                             64                 170                 299
________________________________________________________________________________________________________________________
                                                                           (969)               (951)             (1,973)
________________________________________________________________________________________________________________________
Taxation paid                                                               (33)               (940)               (707)
Capital expenditure and
financial investment
Purchase of other tangible fixed assets                                        -                (14)                (14)
________________________________________________________________________________________________________________________
                                                                               -                (14)                (14)
________________________________________________________________________________________________________________________
Equity dividends paid                                                      (447)               (775)             (1,196)
________________________________________________________________________________________________________________________
Cash inflow/(outflow) before financing              9 (b)                  3,954               (514)             (2,954)
Financing
New loans drawn down                                                           -                   -                   -
Repayment of amounts borrowed                                              (463)               (530)             (1,322)
________________________________________________________________________________________________________________________

                                                                           (463)               (530)             (1,322)
________________________________________________________________________________________________________________________
Increase/(decrease) in cash                                                3,491             (1,044)             (4,276)
________________________________________________________________________________________________________________________
Reconciliation of net cash flow
to movement in net debt
Increase/(decrease) in cash                                                3,491             (1,044)             (4,276)
Cash outflow from decrease in debt                                           463                 530               1,322
________________________________________________________________________________________________________________________
Movement in net debt                                                       3,954               (514)             (2,954)
Non cash movements                                  9 (c)                  5,493                   -                   -
Exchange movements                                                           182               (201)                (52)
Net debt at 1 January                                                   (43,885)            (40,879)            (40,879)
________________________________________________________________________________________________________________________
Net debt at end of period                           9 (b)               (34,256)            (41,594)            (43,885)
________________________________________________________________________________________________________________________






NOTES TO THE ACCOUNTS
    1 Preparation of the interim financial information
      This financial information has been prepared on the basis of the 
      accounting policies set out in the full accounts for the year ended 
      31 December 2002.
________________________________________________________________________________________________________________________
              2 Segmental Analysis
                                                               Six month period            Year ended
                                                                          ended
                                                                                           30.06.2002
                         Operating        Net                         Operating                   Net
                Turnover  (Loss) /     Assets        Turnover     (Loss)/Profit                Assets          Turnover
                            Profit
                    
_______________________________________________________________________________________________________________________
                   Euro'000     Euro'000      Euro'000           Euro'000             Euro'000                 Euro'000           
Euro'000
United Kingdom
Investment          (41)      (81)         93              69                69                 (234)              136
Trading             (13)         -          -               -                 -                 2,198             (26)
Administration         -     (906)      (990)               -             (715)                                      -
and other
      
______________________________________________________________________________________________________________________
                    (54)     (987)                         69             (646)                 1,964              110
______________________________________________________________________________________________________________________
Continental                             (897)
Europe
Trading           13,274     2,142     20,026           2,644             2,362                17,793            5,308
      
______________________________________________________________________________________________________________________
                  13,220     1,155     19,129           2,713             1,716                19,757            5,418
______________________________________________________________________________________________________________________

    3 Income and charges

  (a) Turnover and gross profits include Euro11,314,000 and Euro153,000 respectively 
      relating to the disposal of the  Aartselaar trading property on 4 April 
      2003. The post tax profit on disposal was Euro446,000, reflecting the release 
      of deferred tax provisions.
                                                        Six month                     Six month                  Year
                                                     period ended                    period ended               ended 
                                                       30.06.2003                    30.06.2002            31.12.2002   
_____________________________________________________________________________________________________________________

                                                            Euro'000                         Euro'000                 Euro'000
  (b) Other litigation and related                             38                             -                   141
      exceptional costs
      Provision for impairment in                               -                             -                   139
      value of investment properties
_____________________________________________________________________________________________________________________
                                                               38                             -                   280
_____________________________________________________________________________________________________________________
    4 Tax on Profit on Ordinary
      Activities
                                                        Six month          Six month period ended                Year   
                                                     Period ended                      30.06.2002               ended
                                                       30.06.2003                                          31.12.2002
_____________________________________________________________________________________________________________________
      The tax credit/(charge) on the                        Euro'000                         Euro'000                 Euro'000
      profit on ordinary activities
      for the period was as follows:
      UK Corporation tax at 30.00%                              -                             -                     -
      Adjustment in respect of prior                         (10)                          (16)                 (150)
      year
_____________________________________________________________________________________________________________________
      Current tax charge                                     (10)                          (16)                 (150)
      Deferred taxation                                       161                         (347)                 (602)
_____________________________________________________________________________________________________________________
                                                              151                         (363)                 (752)
_____________________________________________________________________________________________________________________
    5 Earnings per share
                                                        Six month          Six month period ended                Year   
                                                     period ended                      30.06.2002               ended   
                                                       30.06.2003                                          31.12.2002
_____________________________________________________________________________________________________________________
      Earnings per share are calculated as
      follows:
      Profit for the                                     Euro201,000                      Euro265,123               Euro96,706
      period
      Weighted average number of                        7,357,446                     7,357,446             7,357,446
      shares in issue
                           
_____________________________________________________________________________________________________________________
      Basic and diluted earnings per                        Euro0.03                        Euro 0.04                Euro 0.01
                               share
_____________________________________________________________________________________________________________________
    6 Contingent
      Liabilities
      By a circular dated 11 February 1998, the Company announced its entry into 
      a limited partnership with Stratford UK Properties LLC ('Oaktree'), an 
      entity owned by Oaktree Capital Management LLC which is based in the 
      United States of America. On 30 March 2000 a Supplemental Agreement 
      ('Agreement') was entered into with Oaktree purporting to vary the terms 
      of the partnership. It was executed on behalf of the Company, by the then 
      Managing Director, Aubrey Glaser, and the then Company Secretary. This 
      Agreement purported to give Oaktree the right (inter alia) to require the 
      Company to buy out the Oaktree share of the partnership on terms highly 
      beneficial to Oaktree in the event of a change of control of the Company 
      or the departure or non involvement in management of the Chairman (who had 
      no knowledge of the Agreement) or Aubrey Glaser.

      In June 2001 Oaktree purported to invoke the terms of the Agreement 
      requiring the Company to buy out the Oaktree share on the basis set out 
      above, which on current estimates would cost the Company approximately 
      Euro12 million, increasing annually at a rate of 25% compounded monthly.

      The Company claims the Agreement is unenforceable and accordingly on 
      10 July 2001 the Company issued proceedings in the High Court for an order 
      that the Agreement be set aside. On the Company's application for summary 
      judgement Mr. Justice Hart found in favour of the Company and made a 
      declaration that the Agreement was unenforceable against it.  The Court of 
      Appeal reversed the decision, but the House of Lords has granted leave to 
      appeal. On the basis of legal advice it has received, the Board of 
      Directors continues to believe that the Company is unlikely to incur a 
      material loss as a result of the Agreement and therefore no provision has 
      been included in the accounts for this contingent liability, but the 
      matter will be kept under review.

      In September 2001 the Company received a claim from Mr. Glaser for 
      compensation for loss of office totalling Euro404,000 (#280,000). The Company 
      is vigorously defending this claim and having regard to the legal advice 
      received by the Company, no provision has been included in the accounts 
      for this contingent liability.

    7 Stocks - trading properties
      Trading properties at 30 June 2003 comprise the IT Tower and the QPT 
      Tower, Brussels.

    8 Reserves                                           Share        Capital Redemption Reserve      Profit and Loss
                                                       Premium                                                Account
                                                       Account
                           
______________________________________________________________________________________________________________________
                                                         Euro'000                             Euro'000                Euro'000
      At 1 January 2003                                  7,957                               291                6,315
      Retained loss for the                                  -                                 -                (117)
      financial period
                           
______________________________________________________________________________________________________________________
                                                         7,957                               291                6,198
______________________________________________________________________________________________________________________

    9 Cash Flow Statement

  (a) Reconciliation of operating       Six Month period ended                   Six month period ended
      profit to operating cash flows
                           
______________________________________________________________________________________________________________________

                                               30.06.2003                                    30.06.2002
                                                    Euro'000                                         Euro'000
      Operating                                     1,155                                         1,716
      profit
      Depreciation and amortisation                    20                                            44
      charges
      Impairment in value of investment                 -                                             -
      property
      Decrease/(increase) in trading                4,619                                       (1,341)
      properties (see note 10(c))
      (Increase)/decrease in debtors                 (75)                                           423
      (Decrease)/increase in                        (316)                                         1,324
      creditors
______________________________________________________________________________________________________________________
      Net cash inflow from operating                5,403                                         2,166
      activities
______________________________________________________________________________________________________________________

  (b) Analysis of net debt        At 1 January 2003   Cash Flow          Other non-cash movements   Exchange movements
                                 
______________________________________________________________________________________________________________________
                                              Euro'000       Euro'000                             Euro'000                Euro'000
      Cash at bank and in                     2,806       3,491                                 -                  115
      hand
      Debt due within one                   (1,234)         463                             (261)                   67
      year
      Debt due after one                   (45,457)           -                             5,754                    -
      year
______________________________________________________________________________________________________________________
                                           (43,885)       3,954                             5,493                  182
______________________________________________________________________________________________________________________

  (c) Major non-cash transactions

      As part of the consideration following the disposal of the Aartselaar 
      trading property on 4 April 2003, Euro5,493,000 of debt was transferred to 
      the purchaser. The decrease in stock for the period ended 30 June 2003 has 
      been reduced by this amount in the reconciliation of operating profit to 
      operating cash flows.

10    BASINGSTOKE PARTNERSHIP

      Investment property comprises the Company's 25% share of the investment in 
      Mobius House, Basingstoke. The property, which was un-let, was valued at 
      #2,650,000 (Euro4,068,000) by FPD Savills, Chartered Surveyors, in accordance 
      with the requirements of the Royal Institute of Chartered Surveyors on 
      31 December 2002 on the basis of open market value. The Company's 25% 
      share has been retranslated to Euro957,000 at 30 June 2003.

      The property is owned by a limited partnership between the Company and 
      Stratford UK Properties LLC ("Oaktree"). The company is in litigation with 
      Oaktree, details of which are set out in Note 6.

      The partnership is financed as follows:


      1. A senior loan of #1,800,000 (Euro2,601,000) which is non recourse to the 
         Company and in respect of which the Company has given a guarantee on 
         any interest shortfall.


      2. A junior loan of #980,000 (Euro1,416,000) in respect of which the Company 
         has given a guarantee on both principal and any interest shortfall.

      The Company has the benefit of a counter-indemnity from Oaktree for its 
      75% share of any payments under the guarantees.

      The Group has proportionally consolidated its 25% share of the 
      partnership's property, loans and other assets and liabilities. At 30 June 
      2003 interest payments were up to date. No provision has been included for 
      any of the guarantees and counter indemnities at 30 June 2003.

      Since 30 June 2003 notice has been served by the senior lender that its 
      non-recourse loan is in default and repayment has been demanded. As a 
      consequence of this, the junior lender's loan is now in default. Although 
      the Company and Oaktree have agreed a plan with the lenders for the early 
      realisation of the Basingstoke property, in these circumstances, there are 
      fundamental uncertainties as to:


        * the value that may be realised;

        * the Company's liability under the guarantees, which may be 
          crystallised if the sale of the property realises less than the 
          value of #2,650,000 set out above; and

        * the amount that the Company will be able to recover under its 
          counter-indemnity from Oaktree, in the event that it has a liability 
          under the guarantees.

      The interim statement does not reflect any adjustments that would be 
      required if the property is sold for less than #2,650,000 and if the 
      Company is unable to recover any payments under guarantees from Oaktree. 
      The directors estimate that the maximum potential loss to the company 
      arising from these uncertainties is less than #1 million (Euro1.44 million).

      As a consequence of the loan defaults referred to above, amounts totalling 
      #670,000 (Euro968,000) disclosed as creditors falling due in more than one 
      year at 30 June 2003 became a current liability with effect from 
      13 August 2003.





                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

IR SFDFUISDSEIU