TIDMCIC
RNS Number : 1969T
Conygar Investment Company PLC(The)
23 November 2021
23 November 2021
THE CONYGAR INVESTMENT COMPANY PLC
PRELIMINARY RESULTS FOR THE YEARED 30 SEPTEMBER 2021
SUMMARY
-- Net asset value increased by GBP25.3 million (28.5%) to GBP114.1 million (217.4p per share).
-- Total cash deposits of GBP13.7 million (26.0p per share).
-- No debt and no borrowings.
-- GBP29.2 million surplus on valuation of the Group's
investment properties, comprising a GBP28.7 million uplift at The
Island Quarter, Nottingham, and GBP0.5 million uplift at Cross
Hands, Carmarthenshire. The combined surplus amounts to an increase
of 55.6p per share before other net operational and administrative
costs. At The Island Quarter, the resulting GBP70.5 million
valuation equates to approximately GBP2 million per acre.
-- Development progressing for the first phase of the mixed-use
development at The Island Quarter and resolution passed to grant
planning permission for a 700-bed student accommodation scheme.
-- Detailed planning application submitted in January 2021 for
the next phase of The Island Quarter development which includes a
hotel, to be managed by Intercontinental Hotels Group, residential
rental apartments and co-working space.
-- A further planning application was submitted in October 2021
for the proposed waterfront development in Holyhead, Anglesey,
supplementing the outline consent previously granted in 2014, which
includes a 250-berth marina, 259 townhouses and apartments and
associated retail and public realm.
-- Bought back 1.09 million shares (2.0% of ordinary share
capital) at an average price of 111.5p per share.
Group net assets summary
30 September 2021 30 September 2020
Per share Per share
GBP'm p GBP'm p
Properties 108.4 206.6 56.2 104.9
Cash 13.7 26.0 32.1 60.0
Provisions (7.3) (13.9) - -
Other (0.7) (1.3) 0.5 0.9
------ ---------- ------ ----------
Net assets 114.1 217.4 88.8 165.8
====== ========== ====== ==========
Robert Ware, Chief Executive commented:
"The speed and effectiveness of the UK's vaccination programme
has enabled a quicker and stronger economic recovery than many
commentators predicted. This success has been mirrored in the real
estate sector with commercial property values increasing in the
last year, on average by approximately 7%, driven by higher
transaction volumes and the hardening of yields across much of the
market. Our results have benefited from this economic bounce and
reflect a significant improvement to those reported in the previous
year.
Alt hough we are acutely aware that a sustained economic
recovery remains far from assured, and that the expectations within
the real estate industry have changed markedly over recent years,
we are increasingly confident that our property portfolio is well
positioned to benefit both from the renewed market optimism and
significant post COVID-19 social changes."
Enquiries:
The Conygar Investment Company PLC
Robert Ware: 0207 258 8670
David Baldwin: 0207 258 8670
Liberum Capital Limited (nominated adviser and broker)
Richard Lindley: 0203 100 2222
Jamie Richards:
Edward Phillips:
Temple Bar Advisory (public relations)
Alex Child-Villiers: 07795 425580
Will Barker: 07827 960151
Chairman's & chief executive's statement
Results summary
We present the Group's results for the year ended 30 September
2021.
The Group's net asset value per share has increased by 51.6p
(31%) in the year to 217.4p as at 30 September 2021 (2020: 165.8p).
The profit before tax, which includes a GBP29.2 million unrealised
surplus from the revaluation of our investment properties, was
GBP28.2 million (2020: loss of GBP8.2 million).
As at 30 September 2020, the Group's investment in The Island
Quarter, Nottingham, was reported at cost as the fair value at that
date was not readily determinable. However, the substantial
progress made during the year to corroborate the project's design,
market comparables and development cash flows, as well as the
significant progress made on planning and the commencement of
development, has enabled this 36-acre site to be more reliably
valued by Knight Frank LLP as at 30 September 2021.
The resulting valuation of GBP70.5 million, which represents a
GBP28.7 million (69%) surplus over cost, provides support and
justification for the direction of travel taken to date as we start
to unlock, for the benefit of all stakeholders, the full potential
of a project which will, in due course, provide an exciting new
destination as well as substantial investment and employment
opportunities for the city of Nottingham. Further details of the
basis and valuation sensitivities are set out in note 12.
Since acquiring The Island Quarter in 2016, we have made
significant headway in developing the concept and strategy and over
the last year have submitted three detailed planning applications
for the early phase developments. Two of these have subsequently
been granted with the third, which includes two hotels, residential
apartments and co-working space, expected to be considered by the
planning committee at the end of 2021. The detailed applications
granted to date have enabled us to commence the construction of the
first phase, which includes a 21,500 square foot food and
beverage-led building, planned for completion by Easter 2022, and
initiate the on-site preliminary groundworks for a 700-bed student
accommodation scheme which we hope to have operational for the
September 2023 university intake.
In addition, the valuation of our retail park at Cross Hands,
Carmarthenshire, has increased in the year by 7.6% from GBP16.5
million at 30 September 2020 to GBP17.8 million at 30 September
2021, in line with the increase in capital values reported across
the retail warehousing sector.
Retailers with a predominantly out-of-town presence have been
much better protected from the rise of online retailing than those
with a more traditional high street focus where click-and-collect,
larger car parking provisions and the drive-to convenience have
proved more desirable, as highlighted by their higher footfall
throughout the pandemic and quicker recovery post-lockdowns.
At our retail park in Cross Hands, from which over 70% of the
Group's rental income is currently derived, we have collected 97%
of the rents receivable in the year which reduces to 92% for the
Group as a whole. Of the remainder, 2% are expected to be received
in full by the end of the calendar year, 1% are on deferred payment
terms to be settled in full by March 2022 and 5% have been provided
for in these financial statements.
This is a pleasing result, particularly given the volatility in
the retail sector throughout the pandemic, which confirms the
strength and adaptability for the vast majority of the Group's
tenants.
During the year we have also made good progress on the rest of
the portfolio, the brief highlights of which are set out below.
At Holyhead Waterfront in Anglesey we have submitted a further
application, to supplement the outline consent granted in 2014, for
a waterfront development to include both residential apartments and
a 250-berth marina, which we are very hopeful will provide a
catalyst for the regeneration of Holyhead.
Interest continues, from the renewables sector, in our 203-acre
site at Rhosgoch, Anglesey. However, growing concerns about the
capacity for the UK's existing nuclear capability to phase out gas
power and meet the government's net zero targets have reopened the
possibility for at least one more large scale nuclear project this
parliament. Whilst exploratory talks continue between the UK
government and various operators, for a possible nuclear capability
on the Isle of Anglesey, we have not progressed the renewables
option for our sites at Rhosgoch and Parc Cybi as they, in addition
to Holyhead, would be ideally located to support the infrastructure
required for such a project.
As previously reported, we exchanged a conditional contract in
2019 to sell our industrial property in Selly Oak, Birmingham, to a
specialist provider of student accommodation. The conditionality
within the agreement requires, in addition to other matters, the
granting of a permission on the site for a student accommodation
scheme which was duly obtained, subject to agreeing the section
106, in September 2021. This we hope will be the catalyst for the
completion of the property's sale in the coming months.
Elsewhere, we are completing the construction of a spine road
and associated drainage at Haverfordwest in Pembrokeshire to open
up the site for future development and have sold two of our smaller
development sites at King's Lynn, Norfolk and Fishguard Lorry Stop
in Pembrokeshire.
Cash flow
The net cash outflow in the year was GBP18.5 million, including
GBP16.9 million incurred to progress our property developments. As
at 30 September 2021, the Group has available cash deposits of
GBP13.7 million, much of which is allocated to the implementation
of essential infrastructure and completion of the first phase
development at Nottingham. However, in order to further progress
our pipeline of development projects, in particular The Island
Quarter, we will need to raise substantial amounts either as debt,
through asset sales or from joint ventures and we are in advanced
discussions on a number of fronts in that regard.
Dividend
The Board recommends that no dividend is declared in respect of
the year ended 30 September 2021. More information on the Group's
dividend policy can be found within the strategic report.
Share buy back
During the year, the Group acquired 1,092,000 ordinary shares,
representing 2.0% of its ordinary share capital, at a cost of
GBP1.22 million which equates to an average price of 111.5p per
share. As a result of the buy backs, net asset value per share has
been enhanced by 1.1p per share. The Group will seek to renew the
buy back authority of 14.99% of the issued share capital of the
Company at the forthcoming AGM. We consider the buy back authority
to be a useful capital management tool and will continue to use it
when we believe the stock market value differs too widely from our
view of the intrinsic value of the Company.
Board change
We are pleased to welcome David Baldwin to the Board. David was
appointed as Finance Director on 10 May 2021 having been with the
Company for five years as Financial Controller and also, since 6
April 2020, as Company Secretary.
Outlook
The speed and effectiveness of the UK's vaccination programme
has enabled a quicker and stronger economic recovery than many
commentators predicted. This success has been mirrored in the real
estate sector with commercial property values increasing in the
last year, on average by approximately 7%, driven by higher
transaction volumes and the hardening of yields across much of the
market. Our results have benefited from this economic bounce and
reflect a significant improvement to those reported in the previous
year.
Although we are acutely aware that a sustained economic recovery
remains far from assured, and that the expectations within the real
estate industry have changed markedly over recent years, we are
increasingly confident that our property portfolio is well
positioned to benefit both from the renewed market optimism and
significant post COVID-19 social changes.
N J Hamway R T E Ware
Chairman Chief Executive
Strategic report
The Group's strategic report provides a review of the business
for the financial year, discusses the Group's financial position at
the year end and explains the principal risks and uncertainties
facing the business and how we manage those risks. We also outline
the Group's strategy and business model.
Strategy and business model
The Conygar Investment Company PLC ("Conygar") is an AIM quoted
property investment and development group dealing primarily in UK
property. Our aim is to invest in property assets and companies
where we can add significant value using our property management,
development and transaction structuring skills.
The business operates three major strands, being property
investment, property development and investment in companies which
trade or invest in property or hold substantial property assets and
we are prepared to use modest levels of gearing to enhance returns.
Assets are recycled to release capital as opportunities present
themselves and we will continue to buy back shares where
appropriate. The Group is content to hold cash and adopt a patient
strategy unless there is a compelling reason to invest.
Position of the Group at the year end
The Group net assets as at 30 September 2021 may be summarised
as follows:
Per share
GBP'm p
Properties 108.4 206.6
Cash 13.7 26.0
Provisions (7.3) (13.9)
Other (0.7) (1.3)
------ ----------
Net assets 114.1 217.4
====== ==========
Good progress has been made on our investment properties and
development projects since we last reported, the details of which
are set out below. The Group's balance sheet remains both liquid
and robust with cash deposits at 30 September 2021 of GBP13.7
million and no borrowings. We have utilised part of the Group's
cash deposits to commence the infrastructure works and construction
of the first phase of the Island Quarter development in Nottingham.
However, the continuation of future phases requires us to seek
either debt funding, joint venture partners or to sell assets to
take best advantage of the opportunities presented by this
significant development and discussions are ongoing in this
regard.
Key performance indicators
The key measures considered when monitoring progress towards the
Board's objective of providing attractive shareholder returns
include the headway made during the year on its development and
investment property portfolio, the movements in net asset value per
share and levels of uncommitted cash, each of which are considered
below.
Investment properties and development projects
Nottingham, Nottinghamshire
The Group acquired the 36-acre Island Quarter site in Nottingham
city centre in December 2016 for GBP13.5 million. The Island
Quarter is an exciting mixed-use development comprising new homes,
grade A office space, hotels and student accommodation.
During 2021, construction began on the first phase, comprising a
21,500 square foot food and beverage-led building with a canal-side
setting surrounded by new high quality public realm. This is
scheduled to open at Easter 2022 and will, we believe, open up this
previously underused canal-side part of the city and bring local
residents back to The Island Quarter.
In January 2021, a detailed planning application was submitted
for the first major phase of the site, which includes two hotels to
be managed by The Intercontinental Hotels Group, 247 residential
rental apartments, 32,000 square feet of co-working space, as well
as food and beverage areas. Amendments were made to the original
application, such that it is now hoped the permission will be
granted by the end of the year.
In May 2021, a detailed planning application was submitted for a
700-bed student accommodation scheme which was granted in September
2021, subject to agreeing the section 106.
We are progressing the designs for subsequent phases of The
Island Quarter and are in discussions with a variety of commercial
occupiers and potential investors and hope to make announcements on
that front later in the year.
Cross Hands, Carmarthenshire
Following the completion of the lettings in the year to Burger
King, Snap Fitness and One Below the retail park at Cross Hands is
now fully occupied, producing an annual rent roll of GBP1.38
million, which given the economic and social backdrop over the last
12 months is a very pleasing result. The strength and diversity of
the tenant base was emphasised during the pandemic with the park,
which comprises a number of leading brands including Lidl, B&M
Retail, Costa Coffee, Iceland Foods, Dominos Pizza and Pets At
Home, continuing to trade well.
Holyhead Waterfront, Anglesey
After a period of successful stakeholder and community
engagement, we submitted a further detailed application in October
2021 for the proposed waterfront development, which supplements the
outline consent granted in 2014. The application includes a
250-berth marina, 259 townhouses and apartments, marine commercial
and additional A1/A3 retail units together with substantial areas
of improved public realm.
A further GBP0.7 million of costs in connection with the
detailed design and reserved matters application were expensed in
the year to retain the carrying value of the property, in line with
the prior year, at its estimated net realisable value of GBP5.0
million.
Selly Oak, Birmingham
Selly Oak comprises two industrial units, let to University
Hospitals Birmingham NHS Foundation Trust and Revolution Gymnastics
Limited. Contracts were exchanged in 2019 for the sale of the
property, on a subject to planning basis, to a specialist provider
of student accommodation.
The purchaser submitted an application at the start of the year
for a 523 student accommodation scheme for which a resolution to
grant planning permission, subject to agreeing the section 106, was
confirmed by the local authority in September 2021. A further
update on the sale is expected in the coming months once the terms
of the section 106 have been finalised.
Haverfordwest, Pembrokeshire
At Haverfordwest in Pembrokeshire, where we have outline consent
for 729 residential units and 90,000 square feet of implemented A1
retail, we are constructing a 300 metre spine road and associated
infrastructure, to be completed by the end of the year, which will
enable either the sale or development of the site on a plot by plot
basis.
In addition, an application has been submitted to Pembrokeshire
County Council, with a planning officer's recommendation for
approval, to reduce the costs payable under the existing section
106 agreement. We are hopeful of a positive outcome, but await
confirmation of the hearing date from the planning committee.
Parc Cybi business park, Anglesey and Rhosgoch, Anglesey
We hold substantial plots of land at Parc Cybi business park and
Rhosgoch in Anglesey for which there has been continued interest
during the year from operators in the renewables sector. However,
whilst discussions are ongoing between the UK government and
various operators, for the possible reopening of a nuclear
capability in Anglesey, we have not pursued the renewables
option.
King's Lynn, Norfolk and Fishguard Lorry Stop, Pembrokeshire
During the year the Group's development sites at King's Lynn and
Fishguard Lorry Stop were sold for total net proceeds of GBP1.0
million, resulting in a combined net profit of GBP0.4 million.
Summary of investment properties
2021 2020
GBP'm GBP'm
Nottingham - (1) 70.50 19.76
Cross Hands - (2) 17.75 16.50
Total 88.25 36.26
====== ======
(1) The Group's investment in Nottingham was valued by Knight
Frank LLP in their capacity as external valuers as at 30 September
2021. In accordance with IAS 40, as this project was not
sufficiently advanced, such that the fair value could be readily
determined at 30 September 2020, the investment in Nottingham was
reported at cost in the prior year.
(2) The Group's investment in Cross Hands was independently
valued by Knight Frank LLP in both the current and prior years.
Summary of development projects
We remain confident that there is significant upside in these
projects, but this will only become evident over the medium
term.
2021 2020
GBP'm GBP'm
Haverfordwest 8.62 7.78
Holyhead Waterfront 5.00 5.00
Selly Oak 3.57 3.57
Rhosgoch 2.50 2.50
Parc Cybi 0.50 0.50
King's Lynn (1) - 0.53
Fishguard Lorry Stop
(1) - 0.07
Total 20.19 19.95
====== ======
(1) As set out in the strategic report, the Group's development
sites at King's Lynn and Fishguard Lorry Stop were sold in the
year.
Financial review
Net asset value
The net asset value increased by GBP25.3 million (51.6p per
share) to GBP114.1 million at 30 September 2021. The primary
movements in the year were revaluation surpluses for the investment
properties at Nottingham and Cross Hands of GBP28.7 million and
GBP0.5 million respectively, net rental income of GBP1.3 million
plus GBP0.4 million from the sale of our development sites at
King's Lynn and Fishguard Lorry Stop. This has been offset by
GBP0.7 million of development costs written off, GBP2.1 million of
administrative costs, a GBP1.7m provision for deferred tax on
unrealised chargeable gains and GBP1.2 million spent purchasing our
own shares.
Cash flow and financing
At 30 September 2021, the Group had cash deposits of GBP13.7
million and no debt (2020: cash of GBP32.1 million and no
debt).
During the year, the Group used GBP1.8 million of cash in its
operating activities (2020: used GBP6.3 million).
The primary cash outflows in the year were capital costs of
GBP16.9 million and GBP1.2 million to buy back shares. Capital
expenditure includes the construction costs and associated
professional fees for the ongoing infrastructure works, first phase
development and student block preliminary works at The Island
Quarter, completion of the Burger King unit at Cross Hands,
construction of a spine road on the residential site at
Haverfordwest and statutory fees to advance the proposed
development at Holyhead Waterfront.
The cash outflows were partly offset by cash proceeds of GBP1.0
million from the sales of King's Lynn and Fishguard Lorry Stop,
resulting in a net cash outflow in the year of GBP18.5 million
(2020: cash outflow of GBP7.8 million).
Net income from property activities
2021 2020
GBP'm GBP'm
Rental and other income 1.6 1.7
Direct property costs (0.3) (0.2)
------- ------
1.3 1.5
Proceeds from property sales 1.0 3.7
Cost of property sales (0.6) (3.5)
------- ------
Total net income arising from property activities 1.7 1.7
======= ======
Administrative expenses
The administrative expenses for the year ended 30 September 2021
were GBP2.1 million (2020: GBP2.6 million). The major items were
salary costs of GBP1.4 million (2020: GBP1.9 million), head office
running costs and various costs arising as a result of the Group
being listed on AIM.
Taxation
Current tax is payable, at a rate of 19% on net rental income
and profits from the sale of development properties after deduction
of finance costs and administrative expenses.
Deferred tax is calculated at a rate of 25%, being the rate that
has been enacted or substantively enacted by the balance sheet date
and which is expected to apply when the tax liability, resulting
from unrealised chargeable gains arising on revaluation of the
Group's investment properties, is projected to be settled.
Capital management
Capital risk management
The Board's primary objective when managing capital is to
preserve the Group's ability to continue as a going concern, in
order to safeguard its equity and provide returns for shareholders
and benefits for other stakeholders whilst maintaining an optimal
capital structure to reduce the cost of capital.
The Group does not currently have any borrowings, but may
utilise borrowing in the future to fund development projects. When
doing so the Group will seek to ensure that it can stay within
agreed covenants with its lenders.
Treasury policies
The objective of the Group's treasury policies is to manage the
Group's financial risk, secure cost effective funding for the
Group's operations and to minimise the adverse effects of
fluctuations in the financial markets on the value of the Group's
financial assets and liabilities, reported profitability and cash
flows.
The Group finances its activities with a combination of cash and
short term deposits. Other financial assets and liabilities, such
as trade receivables and trade payables, arise directly from the
Group's operations. The Group may also finance its activities with
bank loans and enter into derivative transactions to manage the
interest rate risk arising from its operations and sources of
finance. Throughout the year, and as at the balance sheet date, no
group undertakings were party to any bank loans or derivative
instruments.
The management of cash is monitored weekly with summary cash
statements produced on a monthly basis and discussed regularly in
management and board meetings. The approach is to provide
sufficient liquidity to meet the requirements of the business in
terms of funding developments and potential acquisitions. Surplus
funds are invested with a broad range of institutions. At any point
in time, at least half of the Group's cash is held on instant
access or short term deposit of less than 30 days.
Dividend policy
The Board recommends that no dividend is paid in respect of the
year ended 30 September 2021 (2020: GBPnil).
Our dividend policy is consistent with the overall strategy of
the business: namely to invest in property assets and companies
where we can add significant value using our property management,
development and transaction structuring skills.
In previous years we have used the surplus cash flow from the
then much larger investment property portfolio to enhance these
properties by refurbishment, re-letting and extending tenancies,
fund the operations of the business, create a medium term pipeline
of development opportunities, pay a modest dividend and buy back
shares where appropriate.
The Board will continue to review the dividend policy each year.
Our focus is, and will primarily continue to be, growth in net
asset value per share.
Share buy backs
During the year, the Group acquired 1,092,000 ordinary shares at
an average price of 111.5p, costing GBP1.2 million, which
represented 2.04% of its ordinary share capital. As a result of the
share buy backs, the net asset value per share has been enhanced by
approximately 1.1p per share. The Group will seek to renew the buy
back authority of 14.99% of the issued share capital of the Company
at the forthcoming AGM. We consider it to be a vital capital
management tool and believe it is prudent to have maximum
flexibility given the level of uncertainty we see in the wider
economy.
Principal risks and uncertainties
Managing risk is an integral element of the Group's management
activities and a considerable amount of time is spent assessing and
managing risks to the business. Responsibility for risk management
rests with the Board, with external advisers used where
necessary.
Strategic risks
Strategic risks are risks arising from an inappropriate strategy
or through flawed execution of a strategy. By definition, strategic
risks tend to be longer term than most other risks and, as has been
amply demonstrated in the last few years, the economic and wider
environment can alter quickly and significantly. Strategic risks
identified include global or national events, regulatory and legal
changes, market or sector changes and key staff retention.
The Board continually monitors and discusses the potential
impact that changes to the environment in which we operate can have
upon the Group. We are confident we have sufficiently high calibre
Directors and managers to manage strategic risks.
We are content that the Group has the right approach toward
strategy and our strong balance sheet is good evidence of that.
Operational risks
Operational risks are essentially those risks that might arise
from inadequate internal systems, processes, resources or incorrect
decision making. Clearly, it is not possible to eliminate
operational risk. However, by ensuring we have the right calibre of
staff and external support in place we look to minimise such risks,
as most operational risks arise from people-related issues. Our
Executive Directors are very closely involved in the day-to-day
running of the business to ensure sound management judgement is
applied.
Market risks
Market risks primarily arise from the possibility that the Group
is exposed to fluctuations in the values of, or income from, its
cash deposits, investment properties and development projects. This
is a key risk to the principal activities of the Group and the
exposures are continuously monitored through timely financial and
management reporting and analysis of available market
intelligence.
Where necessary, management takes appropriate action to mitigate
any adverse impact arising from identified risks and market risks
continue to be monitored closely.
Continuing low interest rates have historically made our
liquidity position a drag on income, but it is likely to be helpful
as we take on debt in the coming years to finance our developments.
However, the Group is currently not party to any debt facilities
and the management team have adapted admirably during the COVID-19
pandemic to advance the development portfolio.
Estimation and judgement risks
To be able to prepare accounts according to generally accepted
accounting principles, management must make estimates and
assumptions that affect the asset and liability items and revenue
and expense amounts recorded in the accounts. These estimates are
based on historical experience and various other assumptions that
management and the Board believe are reasonable under the
circumstances. The results of these considerations form the basis
for making judgements about the carrying value of assets and
liabilities that are not readily available from other sources.
The key sources of estimation uncertainty that have a
significant risk of causing material adjustment to the carrying
amounts of assets and liabilities within the next financial year
are the following:
Investment properties
The fair values of investment properties are based upon open
market value and calculated, where applicable, using a third party
valuation provided by an external valuer. Where it is not possible
to reliably measure fair value, cost is used instead.
Development properties
The net realisable value of properties held for development
requires an assessment of fair value of the underlying assets using
property appraisal techniques and other valuation methods. Such
estimates are inherently subjective and actual values can only be
determined in a sales transaction.
Financial assets
The interest rate profile of the Group's cash at the balance
sheet date was as follows:
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Fixed rate term deposit - 10,009
Floating rate 13,657 22,117
--------- ---------
13,657 32,126
========= =========
Fixed and floating rate financial assets comprise cash and short
term deposits held with banks whose credit ratings are acceptable
to the Board.
Credit risk
Credit risk is the risk of financial loss to the Group if a
counterparty fails to meet its contractual obligations. The Group's
principal financial assets include its financial interest in
property assets, cash deposits and trade and other receivables. The
carrying amount of financial assets recorded in the financial
statements represents the Group's maximum exposure to credit risk
without taking account of the value of any collateral obtained.
In the event of default by an occupational tenant, the Group
will suffer a rental shortfall and incur additional costs. The
Directors continually monitor tenant arrears in order to
anticipate, and minimise the impact of, defaults by occupational
tenants and if necessary, where circumstances allow, will apply
rigorous credit control procedures to facilitate the recovery of
trade receivables.
Under IFRS 9, the Group is required to provide for any expected
credit losses arising from trade receivables. For all assured
shorthold tenancies, credit checks are performed prior to
acceptance of the tenant. Regulated tenants are incentivised
through the benefit of their tenancy agreement to avoid default on
their rent and rent deposits are held in respect of two leases.
Taking these factors into account, the risk to the Group of
individual tenant default and the credit risk of trade receivables
are considered low, albeit the risk has increased as a result of
the impact of COVID-19, as is borne out by the level of trade
receivables written off in the current and prior years.
The Directors have provided for rental and other arrears due
from various tenants impacted by, amongst other factors, the
COVID-19 pandemic which amount to GBP118,000 at 30 September 2021
and which remain outstanding at the date of signing these financial
statements. The table below sets out the movement in the bad debt
provision during the year. The impaired receivables are based on a
review of expected credit losses. Impaired receivables and
receivables not considered to be impaired are not material to the
financial statements and, therefore, no further analysis is
provided.
Provision for bad debts 30 Sep 21 30 Sep 20
GBP'000 GBP'000
At the start of the year 49 -
Provided in the year 69 49
--------- ---------
At the end of the year 118 49
========= =========
The credit risk on cash deposits is managed through the
Company's policies of monitoring counterparty exposure and the use
of counterparties of good financial standing. At 30 September 2021,
the credit exposure from cash held with banks was GBP13.7 million
which represents 12.0% of the Group's net assets. All cash deposits
at the balance sheet date are placed with banks, whose credit
ratings are acceptable to the Board, on instant access accounts.
Should the credit quality or the financial position of the banks
currently utilised significantly deteriorate, cash deposits would
be moved to alternative banks.
Liquidity risk
Liquidity risk is the risk that the Group will not be able to
meet its financial obligations as they fall due. The Group seeks to
manage its liquidity risk by ensuring that sufficient cash is
available to meet its foreseeable needs. The Group has cash
deposits at the balance sheet date of GBP13.7 million. However, we
will need to raise substantial amounts either as debt, or through
joint ventures or asset sales, in order to significantly progress
The Island Quarter development in Nottingham.
Section 172 statement
Directors' duty to promote the success of the Company under
Section 172 Companies Act 2006
The strategic report is required to include a statement that
describes how the Directors have had regard to the matters set out
in section 172(1) (a) to (f) of the Companies Act 2006 when
performing their duty under section 172. Some of the matters
identified in Section 172(1) are already covered by similar
provisions in the QCA Code and have thus been previously reported
by the Company in the corporate governance statement, the corporate
governance report and the QCA statement of compliance on our
website. In order to avoid unnecessary duplication, the relevant
parts of those documents are identified below and are to be treated
as expressly incorporated by reference into this strategic report.
Under section 172 (1) of the Companies Act 2006, each individual
Director must act in the way he considers, in good faith, would be
the most likely to promote the success of the Company for the
benefit of its members as a whole, and in doing so have regard
(amongst other matters) to six matters detailed in the section. In
discharging their duties, the Directors seek to promote the success
of Conygar for the benefit of members as a whole and have regard to
all the matters set out in Section 172(1), where applicable and
relevant to the business, taking account of its size and structure
and the nature and scale of its activities in the commercial
property market. The following paragraphs address each of the six
matters in Section 172(1) (a) to (f).
(a) The likely consequences of any decision in the long term:
The commercial property market is cyclical by nature. Investing in
commercial property is a long term business. The decisions taken
must have regard to long term consequences in terms of success or
failure and managing risks and uncertainties. The Directors cannot
expect that every decision they take will prove, with the benefit
of hindsight, to be the best one - external factors may affect the
market and thus change conditions in the future, after a decision
has been taken. However, the Group's investment decisions are
undertaken by a Board with a wide range of experience, over many
years, in both the property and finance sectors.
(b) The interests of the Company's employees: The Company has
five full time employees, including the Chief Executive, two
Property Directors and the Finance Director. These Executive
Directors sit on the Board with the Non-Executive Directors.
(c) The need to foster the Company's business relationships with
suppliers, customers and others: The Directors have regularly
reported in the Company's annual reports on the constructive
relationships that Conygar seeks to build with its tenants and the
mutual benefits that this brings to both parties; and this
reporting has been extended over the past two years following
Principle 3 of the QCA Code to include suppliers and others. This
is therefore addressed under Principle 3 in the QCA compliance
statement. In recent years, it has been vital to foster our
business relationships with tenants given external factors
affecting business and the economy, such as political uncertainty
and the continuing impact of the COVID-19 pandemic.
(d) The impact of the Company's operations on the community and
the environment: This is also addressed under Principle 3 of the
QCA Code in the QCA compliance statement. Due to its size and
structure and the nature and scale of its activities, the Board
considers that the impact of Conygar's operations as a landlord on
the community and the environment is low. Conygar's assets are used
by its tenants for their own operations rather than by Conygar
itself. In the past year, the Company has not been made aware of
any tenant operations that have had a significant impact on the
community or the environment. In relation to planned developments,
Conygar seeks to ensure that designs and construction comply with
all relevant environmental standards and with local planning
requirements and building regulations so as not to adversely affect
the community or the environment.
(e) The desirability of the Company maintaining a reputation for
high standards of business conduct: This is addressed under
Principle 8 of the QCA Code in the corporate governance statement
and in the QCA compliance statement. The Board considers that
maintaining Conygar's reputation for high standards of business
conduct is not just desirable - it is a valuable asset in the
competitive commercial property market.
(f) The need to act fairly as between members of the Company:
The Company has only one class of shares, thus all shareholders
have equal rights and, regardless of the size of their holding,
every shareholder is, and always has been, treated equally and
fairly. Relations with shareholders are further addressed under
Principles 2, 3 and 10 of the QCA Code in the corporate governance
report and the QCA compliance statement. We have been reviewing how
we communicate with shareholders and are in the process of
encouraging shareholders to adopt electronic communications and
proxy voting in place of paper documents where this suits them, as
well as to raise questions in writing if they are unable to attend
AGMs.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 30 September 2021
Note Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Rental income 1,592 1,675
Proceeds on sale of development and 1,050 -
trading properties
Revenue 2,642 1,675
----------- -----------
Direct costs of rental income 288 233
Costs on sale of development and trading 620 -
properties
Development costs written off 14 675 5,611
Direct costs 1,583 5,844
----------- -----------
Gross profit / (loss) 1,059 (4,169)
Surplus / (deficit) on revaluation
of
investment property 11 459 (1,722)
Surplus on revaluation of investment
properties under construction 12 28,718 -
Profit on sale of investment property - 167
Administrative expenses (2,058) (2,623)
----------- -----------
Operating profit / (loss) 3 28,178 (8,347)
Finance costs 6 (2) (5)
Finance income 6 34 187
Profit / (loss) before taxation 28,210 (8,165)
Taxation 8 (1,685) 210
----------- -----------
Profit / (loss) and total comprehensive
income / (charge) for the year 26,525 (7,955)
----------- -----------
Basic and diluted profit / (loss)
per share 10 49.99p (14.73)p
All amounts are attributable to equity
shareholders of the Company.
All of the activities of the Group are classed as
continuing.
CONSOLIDATED Statement of Changes in Equity
for the year ended 30 September 2021
Attributable to the equity holders of the Company
Capital
Share redemption Treasury Retained Total
capital reserve shares earnings equity
Group GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Changes in equity for
the year ended 30 September
2020
At 1 October 2019 2,826 3,727 - 94,177 100,730
Adjustment on implementation
of IFRS 16 - - - 23 23
-------------- ------------ ----------- ----------- ----------
2,826 3,727 - 94,200 100,753
Loss for the year - - - (7,955) (7,955)
-------------- ------------ ----------- ----------- ----------
Total comprehensive
charge for the year - - - (7,955) (7,955)
Purchase of own shares - - (3,965) - (3,965)
Cancellation of treasury
shares (146) 146 3,965 (3,965) -
At 30 September 2020 2,680 3,873 - 82,280 88,833
============== ============ =========== =========== ==========
Changes in equity for
the year ended 30 September
2021
At 1 October 2020 2,680 3,873 - 82,280 88,833
Profit for the year - - - 26,525 26,525
-------------- ------------ ----------- ----------- ----------
Total comprehensive
income for the year - - - 26,525 26,525
Purchase of own shares - - (1,217) - (1,217)
Cancellation of treasury
shares (55) 55 1,217 (1,217) -
At 30 September 2021 2,625 3,928 - 107,588 114,141
============== ============ =========== =========== ==========
CONSOLIDATED BALANCE SHEET
at 30 September 2021
Note 30 Sep 2021 30 Sep
GBP'000 2020
GBP'000
Non-current assets
Investment properties 11 17,750 16,500
Investment properties under construction 12 70,500 19,761
Right of use asset 7 53 146
Deferred tax asset 8 2,935 -
91,238 36,407
------------ ---------
Current assets
Development and trading properties 14 20,192 19,952
Trade and other receivables 15 2,661 1,655
Tax asset 28 31
Cash and cash equivalents 13,657 32,126
------------ ---------
36,538 53,764
------------ ---------
Total assets 127,776 90,171
Current liabilities
Trade and other payables 16 3,367 1,215
Provision for liabilities and charges 17 5,614 -
Lease liability for right of use
asset 7 34 89
9,015 1,304
Non-current liabilities
Deferred tax liability 8 4,620 -
Lease liability for right of use
asset 7 - 34
------------ ---------
4,620 34
Total liabilities 13,635 1,338
------------ ---------
Net assets 114,141 88,833
============ =========
Equity
Called up share capital 18 2,625 2,680
Capital redemption reserve 3,928 3,873
Retained earnings 107,588 82,280
------------ ---------
Total equity 114,141 88,833
============ =========
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 30 September 2021
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Cash flows from operating activities
Operating profit / (loss) 28,178 (8,347)
Development costs written off 675 5,611
(Surplus) / deficit on revaluation of investment
properties (29,177) 1,722
Profit on sale of investment property - (167)
Profit on sale of development and trading properties (430) -
Depreciation of right of use assets 93 93
Cash flows from operations before changes in
working capital (661) (1,088)
Increase in trade and other receivables (1,006) (107)
Additions to development and trading properties (1,438) (4,901)
Net proceeds from sale of development and trading 1,025 -
properties
Increase / (decrease) in trade and other payables 287 (253)
----------- ---------------------
Cash flows used in operations (1,793) (6,349)
Tax received 3 38
----------- ---------------------
Cash flows used in operating activities (1,790) (6,311)
----------- ---------------------
Cash flows from investing activities
Additions to investment properties (15,496) (1,369)
Proceeds from sale of an investment property - 3,673
Finance income 34 187
Cash flows (used in) / generated from investing
activities (15,462) 2,491
----------- ---------------------
Cash flows from financing activities
Purchase of own shares (1,217) (3,965)
Cash flows used in financing activities (1,217) (3,965)
----------- ---------------------
Net decrease in cash and cash equivalents (18,469) (7,785)
Cash and cash equivalents at 1 October 32,126 39,911
Cash and cash equivalents at 30 September 13,657 32,126
----------- ---------------------
NOTES TO THE ACCOUNTS
for the year ended 30 September 2021
1. The financial information set out in this announcement is
abridged and does not constitute statutory accounts for the year
ended 30 September 2021 but is derived from the financial
statements. The auditors have reported on the statutory accounts
for the year ended 30 September 2021, their report was unqualified
and did not contain statements under sections 498(2) or (3) of the
Companies Act 2006, and these will be delivered to the registrar of
companies following the Company's Annual General Meeting. The
financial information has been prepared using the recognition and
measurement principle of IFRS.
2. The comparative financial information for the year ended 30
September 2020 was derived from information extracted from the
annual report and accounts for that period, which was prepared
under IFRS and which has been filed with the UK registrar of
companies. The auditors have reported on those accounts, their
report was unqualified and did not contain statements under section
498 (2) or (3) of the Companies Act 2006.
3. Operating PROFIT / (Loss)
Operating profit / (loss) is stated after charging:
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Audit of the Company's consolidated and individual
financial statements 47 39
Audit of subsidiaries, pursuant to legislation 24 15
Fees payable to the Company's auditor for tax
services - 13
Amortisation of right of use asset 93 93
4. PARTICULARS OF EMPLOYEES
The aggregate payroll costs were: Year ended Year ended
30 Sep
21 30 Sep 20
GBP'000 GBP'000
Wages and salaries 1,247 1,673
Social security costs 161 215
1,408 1,888
========== ==========
The average monthly number of persons, including Executive
Directors, employed by the Company during the year was seven (2020:
seven).
5. DIRECTORS' EMOLUMENTS
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Basic salary and total emoluments 929 1,329
Emoluments of the highest paid Director 400 455
=========== ===========
The Board, being the key management personnel, comprises the
only persons having authority and responsibility for planning,
directing and controlling the activities of the Group.
6. FINANCE INCOME AND COST
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Bank interest receivable 34 187
=========== ===========
Interest cost under IFRS 16 2 5
=========== ===========
7. LEASES
Group as lessor:
The Group receives income from investment properties and
existing tenants located at several development sites. At 30
September 2021, the minimum lease payments receivable under
non-cancellable operating leases were as follows:
30 Sep 30 Sep 20
21
GBP'000 GBP'000
Less than one year 1,385 1,223
Between one and five years 5,873 5,254
Over five years 6,249 6,668
-------- ----------
13,507 13,145
======== ==========
The amounts above represent total rental income up to the next
tenant only break date for each lease.
Group as lessee:
The Group is party to a lease which terminates on 28 April
2022.
IFRS 16 requires lessees to record all leases on the balance
sheet as liabilities along with an asset reflecting the right of
use of the asset over the lease term.
At the start of the prior year, the lease liability was
calculated as the present value of the remaining lease payments,
discounted at an incremental borrowing rate of 2.7%. The right of
use asset was measured at the amount equal to the lease liability
adjusted for rent prepaid on the date of implementation.
Depreciation of the right of use asset is on a straight line basis
over the lease term.
The modified retrospective approach was adopted for transition
purposes such that comparatives were not restated and the
difference between the right of use asset and lease liability at
the start of the prior year was recognised within the Group's
opening retained earnings.
Year ended Year ended
30 Sep 21 30 Sep
20
Right of use asset GBP'000 GBP'000
At the start of the year 146 239
Depreciation (93) (93)
----------- -----------
At the end of the year 53 146
=========== ===========
Lease liability GBP'000 GBP'000
At the start of the year 123 217
Lease payments (91) (99)
Interest on lease liability 2 5
----------- -----------
At the end of the year 34 123
=========== ===========
Lease liability maturity analysis 30 Sep 21 30 Sep
20
Gross lease payments due: GBP'000 GBP'000
Within one year 34 91
Within two to five years - 34
---------- --------
Total gross lease payments 34 125
---------- --------
Less future financing charges - (2)
---------- --------
At end of the year 34 123
========== ========
Current 34 89
========== ========
Non-current - 34
========== ========
8. TAX
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Current tax charge / (credit) - (210)
Deferred tax charge 1,685 -
------------- -----------
Total tax charge / (credit) 1,685 (210)
============= ===========
The tax assessed on the profit for the year differs from the standard
rate of tax in the UK of 19% (2020: 19%). The differences are
explained below:
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Profit / (loss) before tax 28,210 (8,165)
============= =============
Profit / (loss) before tax multiplied by the
standard rate of UK tax 5,360 (1,551)
Effects of:
Investment property revaluation not taxable (5,543) 327
Movement in tax losses carried forward 186 1,244
Expenses not deductible for tax purposes 10 31
Capital allowances utilised (13) (65)
Impact of differing tax rates for offshore
entities - 14
Overprovision of prior year tax - (210)
Deferred tax charge 1,685 -
------------- -------------
Total tax charge / (credit) for the year 1,685 (210)
============= =============
Deferred tax asset
Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Deferred tax asset at the start of the year - -
Deferred tax credit for the year 2,935 -
----------- -----------
Deferred tax asset at the end of the year 2,935 -
=========== ===========
The Group has recognised a deferred tax asset for tax losses,
held by group undertakings, where the Directors believe it is
probable that this asset will be recovered.
As at 30 September 2021, the Group has further unused losses of
GBP20.1 million (2020: GBP41.0 million) for which no deferred
tax asset has been recognised in the consolidated balance sheet.
Deferred tax liability - in respect of
chargeable gains on investment properties Year ended Year ended
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Deferred tax liability at the start of the - -
year
Deferred tax charge for the year 4,620 -
----------- -----------
Deferred tax liability at the end of the year 4,620 -
=========== ===========
The Directors have assessed the potential deferred tax liability
of the Group as at 30 September 2021 in respect of chargeable
gains that would be payable if the investment properties were
sold at their financial year end valuations. Based on the unrealised
chargeable gains of GBP18,478,000 (2020: GBPnil) a deferred tax
liability of GBP4,620,000 has been recognised.
The deferred tax asset and liability have been calculated at a
corporation tax rate of 25% being the rate that has been enacted
or substantively enacted by the balance sheet date and which is
expected to apply when the liability is settled and the asset
realised.
9. DIVIDS
No dividend will be paid in respect of the year ended 30
September 2021 (2020: nil).
10. PROFIT / (LOSS) PER SHARE
Profit per share is calculated as the profit attributable to
ordinary shareholders of the Company for the year of GBP26,525,000
(2020: loss of GBP7,955,000) divided by the weighted average number
of shares in issue throughout the year of 53,064,275 (2020:
54,007,994). There are no diluting amounts in either the current or
prior years.
11. INVESTMENT PROPERTIES
Freehold investment properties
30 Sep 21 30 Sep 20
GBP'000 GBP'000
At the start of the year 16,500 21,429
Additions 791 305
Disposals - (3,512)
Revaluation surplus / (deficit) 459 (1,722)
At the end of the year 17,750 16,500
========== ==========
As at 30 September 2021, Cross Hands was valued by Knight Frank
LLP in their capacity as external valuers. The valuation was
prepared on a fixed fee basis, independent of the property value
and undertaken in accordance with RICS Valuation - Global Standards
on the basis of fair value, supported by reference to market
evidence of transaction prices for similar properties. It assumes a
willing buyer and a willing seller in an arm's length transaction
and reflects usual deductions in respect of purchaser's costs and
SDLT as applicable at the valuation date. The independent valuer
makes various assumptions including future rental income,
anticipated void costs and the appropriate discount rate or
yield.
The fair value of Cross Hands has been determined using an
income capitalisation technique whereby contracted rent and market
rental values are capitalised with a market capitalisation rate.
This technique is consistent with the principles in IFRS 13 and
uses significant unobservable inputs, such that the fair value has
been classified in all periods as Level 3 in the fair value
hierarchy as defined in IFRS 13. For Cross Hands, the key
unobservable inputs are the net initial yields and expiry void
periods. Net initial yields have been estimated for the individual
units at between 5.0% and 9.5% and expiry void periods are
projected at between 6 and 12 months. The principal sensitivity of
measurement to variations in the significant unobservable outputs
is that decreases in net initial yields and void periods will
increase the fair value.
The historical cost of the Group's investment properties as at
30 September 2021 was GBP14,242,000 (2020: GBP13,451,000).
The Group's revenue for the year includes GBP1,552,000 derived
from properties leased out under operating leases (2020:
GBP1,635,000).
12. INVESTMENT PROPERTIES UNDER CONSTRUCTION
Freehold land and buildings
30 Sep 21 30 Sep 20
GBP'000 GBP'000
At the start of the year 19,761 -
Additions 16,407 -
Revaluation surplus 28,718 -
Introductory fee provision (note 17) 5,614 -
Transfer from trading properties - 19,761
At the end of the year 70,500 19,761
========== ==========
Investment properties under construction comprise the freehold
land and buildings at The Island Quarter in Nottingham which are
held for current or future development as investment properties and
reported in the balance sheet at fair value as at 30 September 2021
and cost as at 30 September 2020.
The fair value of this property rests in the ongoing and planned
developments which, as at 30 September 2020, was difficult to
estimate pending confirmation of designs and planning permissions,
and hence, in accordance with IAS 40, was measured at cost until
either the fair value became readily determinable or construction
was complete.
However, the substantial progress made during the year to
corroborate the design, market comparables and projected cash flows
as well as the significant progress made on planning and the
commencement of the development has enabled The Island Quarter to
be valued as at 30 September 2021 by Knight Frank LLP in their
capacity as external valuers.
The valuations of the Group's investment properties are
inherently subjective as they are based on the valuers' assumptions
which may not prove to be accurate and which, as a result, are
subject to material uncertainty. This is particularly true for The
Island Quarter given its scale, lack of comparable evidence and the
early stage position of this substantial development where
relatively small changes to the underlying assumptions of key
parameters, such as rental levels, net initial yields, construction
costs, finance costs and void periods can have a significant impact
both positively and negatively on the resulting valuation.
In preparing their valuation, Knight Frank have utilised market
and site specific data, their own extensive knowledge of the real
estate sector, professional judgement and other market observations
as well as information provided by the Company's Executive
Directors. The resulting models and assumptions therein have also
been reviewed for overall reasonableness by the Conygar Board.
Inevitably in a complex model like this, and as noted above,
variations in assumptions can lead to widely differing values. The
Board have considered the valuation in the context of their
experience and believe the value of approximately GBP2 million per
acre is justifiable.
The valuation was prepared on a fixed fee basis, independent of
the property value and undertaken in accordance with RICS Valuation
- Global Standards on the basis of fair value, supported by
reference to market evidence of transaction prices for similar
properties. It assumes a willing buyer and a willing seller in an
arm's length transaction and reflects usual deductions in respect
of purchaser's costs and SDLT as applicable at the valuation date.
The independent valuer makes various assumptions including future
rental income, anticipated void costs and the appropriate discount
rate or yield.
The fair value of Nottingham has been determined using an income
capitalisation technique whereby contracted rent and market rental
values are capitalised with a market capitalisation rate. This
technique is consistent with the principles in IFRS 13 and uses
significant unobservable inputs, such that the fair value has been
classified in all periods as Level 3 in the fair value hierarchy as
defined in IFRS 13. For Nottingham, the key unobservable inputs are
the net initial yields, construction costs, rental income rates and
expiry void periods. Net initial yields have been estimated for the
individual units at between 4.35% and 7.0%. The principal
sensitivity of measurement to variations in the significant
unobservable outputs is that decreases in net initial yields,
construction costs and void periods will increase the fair value
whereas reductions to rental income rates would decrease the fair
value.
The historical cost of the Group's investment properties under
construction as at 30 September 2021 was GBP36,168,000 (2020:
GBP19,761,000).
13. INVESTMENT IN SUBSIDIARY UNDERTAKINGS
The companies listed below are the subsidiary undertakings of
the Group at 30 September 2021, all of which are wholly owned.
Country
of % of
Company name Principal activity Registration equity held
Conygar Holdings Ltd** Holding Company England 100%
Conygar Haverfordwest
Ltd** Property trading and development England 100%*
Conygar Holyhead Ltd** Property trading and development England 100%*
Conygar Nottingham Ltd** Property investment England 100%*
Nohu Limited** Property investment England 100%*
Parc Cybi Management
Company Limited** Management Company England 100%
Conygar Developments Ltd** Dormant England 100%*
Conygar Wales PLC** Dormant England 100%*
The Island Quarter Student
Property
Company Ltd** Dormant England 100%*
The Island Quarter Student
Operating Company Ltd** Dormant England 100%*
The Island Quarter Propco
1 Ltd** Dormant England 100%*
The Island Quarter
Management Company Ltd** Dormant England 100%*
Lamont Property Holdings
Ltd*** Holding Company Jersey 100%*
Conygar Ashby Ltd*** Property investment Jersey 100%*
Conygar Cross Hands Ltd*** Property investment Jersey 100%*
* Indirectly owned.
** Subsidiaries with the same registered office as the Company.
*** Subsidiaries incorporated in Jersey with a registered office at 3(rd) Floor, 44 Esplanade,
St Helier, Jersey JE4 9WG.
14. DEVELOPMENT AND TRADING PROPERTIES
30 Sep 21 30 Sep
GBP'000 20
GBP'000
At the start of the year 19,952 39,999
Additions 1,510 5,325
Disposals (595) -
Transfer to investment properties
under construction - (19,761)
Development costs written off (675) (5,611)
At the end of the year 20,192 19,952
========== ===========
Development and trading properties are reported in the balance
sheet at the lower of cost and net realisable value. The net
realisable value of properties held for development requires an
assessment of the underlying assets using property appraisal
techniques and other valuation methods. Such estimates are
inherently subjective as they are made on assumptions which may not
prove to be accurate and which can only be determined in a sales
transaction.
15. TRADE AND OTHER RECEIVABLES
30 Sep 21 30 Sep
20
GBP'000 GBP'000
Trade receivables 127 107
Other receivables 1,229 613
Prepayments and accrued income 1,305 935
-------- --------
2,661 1,655
======== ========
Trade and other receivables are measured on initial recognition
at fair value, and are subsequently measured at amortised cost
using the effective interest rate method, less any impairment.
Impairment is calculated using an expected credit loss model.
16. TRADE AND OTHER PAYABLES
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Social security and payroll taxes 55 56
Trade payables 2,300 611
Accruals and deferred income 1,012 548
-------- ----------
3,367 1,215
======== ==========
Trade and other payables are recognised initially at fair value,
and are subsequently measured at amortised cost using the effective
interest rate method.
17. PROVISION FOR LIABILITIES AND CHARGES
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Services and introduction fee 5,614 -
=========== ==============
The Group is party to a services agreement and introduction fee
agreement in connection with its investment property at Nottingham.
The fee payable, under the terms of each agreement, in connection
with introductory and other services, is to be calculated on the
earlier of the date of sale of the property or 22 December 2021
with settlement to follow, subject to agreement between each party,
31 business days after the fee calculation has been finalised. The
provision as at 30 September 2021 has been calculated by reference
to the open market value of the property at the balance sheet date
after allowing for a priority return and applicable costs.
18. SHARE CAPITAL
Authorised share capital: 30 Sep 21 30 Sep 20
GBP GBP
140,000,000 (2020: 140,000,000) Ordinary shares
of 5p each 7,000,000 7,000,000
========= ===========
Allotted and called up:
No GBP'000
As at 30 September 2019 56,522,435 2,826
Cancellation of treasury shares (2,930,845) (146)
---------------- -----------------
As at 30 September 2020 53,591,590 2,680
Cancellation of treasury shares (1,092,000) (55)
---------------- -----------------
As at 30 September 2021 52,499,590 2,625
================ =================
In December 2010, the Group began a share buyback programme and
during the year ended 30 September 2021 purchased 1,092,000 (2020:
2,930,845) shares on the open market at a cost of GBP1,217,000
(2020: GBP3,965,000). On 16 September 2021, 1,092,000 ordinary
shares of 5p each were transferred out of treasury and cancelled
(2020: 2,930,845 ordinary shares of 5p each).
19. CAPITAL COMMITMENTS
As at 30 September 2021, the Group had contracted capital
commitments, not provided for in the financial statements, of
GBP12,800,000 (2020: GBP326,000) relating to the construction,
development or enhancement of the Group's investment and trading
properties.
20. FINANCIAL INSTRUMENTS
The following tables set out the Group's financial assets and
liabilities, all of which are due within one year. The tables have
been drawn up based on the undiscounted cash flows of financial
liabilities, based on the earliest date on which the Group can be
required to pay.
Financial assets:
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Cash and cash equivalents 13,657 32,126
Trade receivables 127 107
Other receivables (excluding VAT) 253 232
-------- ----------
14,037 32,465
======== ==========
Financial liabilities:
30 Sep 21 30 Sep 20
GBP'000 GBP'000
Trade payables and other accrued expenses 3,175 993
========= ==========
23. EVENTS AFTER THE BALANCE SHEET DATE
There are no significant events since the balance sheet date
that require disclosure in the financial statements.
The report and accounts for the year ended 30 September 2021
will be posted to shareholders shortly and copies may be obtained
free of charge for at least one month following their posting by
writing to the Company Secretary, The Conygar Investment Company
PLC, 1 Duchess Street, London W1W 6AN. They are also available on
the website www.conygar.com .
The Company's Annual General Meeting (the "AGM") will be held at
4:00pm on Monday, 20 December 2021 at the offices of Gowling WLG
(UK) LLP, 4 More London Riverside, London, SE1 2AU.
The Directors of Conygar accept responsibility for the
information contained in this announcement. To the best of the
knowledge and belief of the Directors of Conygar (who have taken
all reasonable care to ensure that such is the case) the
information contained in this announcement is in accordance with
the facts and does not omit anything likely to affect the import of
such information.
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as amended by The
Market Abuse (Amendment) (EU Exit) Regulations 2019. Upon the
publication of this announcement via the Regulatory Information
Service, this inside information is now considered to be in the
public domain.
This announcement is being made on behalf of the Company by
David Baldwin, Finance Director.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
FR BTBTTMTMTTJB
(END) Dow Jones Newswires
November 23, 2021 02:00 ET (07:00 GMT)
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