TIDMWSP
RNS Number : 0780G
Wynnstay Properties PLC
23 November 2020
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this information is considered to be in the public
domain.
WYNNSTAY PROPERTIES PLC
("Wynnstay" or the "Company")
INTERIM REPORT FOR THE SIX MONTHSED 29 SEPTEMBER 2020
CHAIRMAN'S STATEMENT
Despite the business and economic challenges and uncertainties
arising from the Covid-19 pandemic and the Brexit negotiations, I
am pleased to report on a very creditable performance by Wynnstay
for the six months period ending 29 September 2020.
Interim Financial Results
The unaudited results are summarised in the table below, which
should be read in conjunction with the following commentary and
financial statements:
29 September 29 September
2020 2019
Property Income (11.2)% GBP1,055,000 GBP1,188,000
Operating Income (11.0)% GBP750,000 GBP843,000
Income before Taxation (49.8)% GBP538,000 GBP1,072,000
Earnings per share (54.4)% 16.0p 35.1p
Net Asset Value per share (3.6)% 800p 830p
Interim Dividend per share 6.7% 8.0p 7.5p
Property Income for the half-year was just over 11% lower than
in the same period last year at GBP1,055,000 (2019: GBP1,188,000)
with a broadly similar percentage decrease in Operating Income at
GBP750,000 (2019: GBP843,000). This year we have the benefit of a
full contribution from the additional unit at Aylesford acquired in
August 2019. However, last year's income also included rent from
the two units at Chessington, which became vacant in June 2019, all
three units at Basingstoke which we sold in August 2019 and our
remaining unit at St Neots which we also sold last year.
This year's lower income also reflects the support that we have
given to a number of tenants through concessionary arrangements to
assist them in the difficult trading conditions arising from the
impact of the Covid-19 pandemic. As I explained in my statement in
July, these arrangements have involved either deferral of part of a
quarter's rent for a limited period by spreading its payment over
the remainder of our financial year or rent holidays or deferrals
generally in return for the removal of tenant break options or
lease extensions. Our willingness to assist and work with tenants
to find suitable arrangements for them has been appreciated and all
tenants who benefited from such initiatives have to date kept to
the revised terms.
Income before taxation for the half-year was substantially lower
than last year which included a profit of GBP440,000 on the sale of
our properties at Basingstoke and St Neots, whereas this year there
were no property sales. On a comparable basis, excluding property
sales, income before taxation fell by just under 15%. Comparable
earnings per share were also similarly affected by the property
sales last year.
We continue to keep in close contact with our tenants and to
monitor carefully the receipts of our adjusted rental income,
taking account of the concessionary arrangements made. In my
statement in July I reported that we had collected all of the
rental income due for the first quarter of the year commencing 26
March 2020 and that we had collected over 70% of the rent due for
the second quarter commencing 24 June 2020, comprising both
quarterly rents and those now being paid monthly. I am pleased to
report that there is now no significant rent outstanding for the
second quarter and that for the third quarter, commencing 29
September 2020, we have collected 98% of the quarterly and monthly
rents due, with the main outstanding items being the monthly
payments now due on 1 December 2020.
Borrowings from Handelsbanken at the end of the half-year were
the same as for the same period last year at GBP12.5 million.
In the light of the many challenges and uncertainties and their
effects on our tenants, their businesses and the commercial
property market, the Board considers the financial results for the
first half of the year are very creditable.
Portfolio
The portfolio is 94% let which, while consistent with our past
record of high occupancy and low voids, is considered by the Board
to be very satisfactory in the circumstances. It is also
encouraging to note that during August and September we negotiated
the renewal, at increased rents, of two leases on our Quarry Wood
Industrial Estate at Aylesford and we were also able to agree terms
to relet a unit at Uckfield immediately following the expiry of the
lease to the previous tenant.
Work has continued regarding the proposed development of our
Trade Park at Petersfield, where I mentioned in my July statement
that we were finalising agreements for lease with tenants for two
of the three units. Negotiations have been slowed as a result of
the Covid-19 pandemic, but I am pleased to report that we now seem
to be making progress and anticipate both agreements being
finalised shortly. In the meantime, we have been progressing with
the tendering process for construction. When two of the three units
are prelet, we feel confident that we should be in a position to
appoint our chosen contractor with a view to starting construction
early in 2021. On our Beaver Industrial Estate at Liphook we are
keen to progress with the construction of the two single storey
units. However, due to the current economic environment resulting
from the pandemic, we do not expect to take further decisions on
this until next year. I will of course keep shareholders updated on
both developments in future statements.
I have previously reported on our plans to relet the two vacant
units at Oakcroft Business Centre in Chessington. With much of the
commercial property market and many businesses being in lockdown
during the spring and early summer, while there was some interest
from potential tenants, none came to fruition. Accordingly, we took
the decision to explore interest in a sale of the entire freehold
property of three units while continuing also to offer them for
letting singly or in combination. There has been interest from
potential purchasers as well as from potential tenants.
Dividend
In light of the financial results, the Board has decided to pay
an increased interim dividend of 8.0p per share (2019: 7.5p) on 18
December 2020 to those shareholders on the register on 4 December
2020. The Board is pleased to be able to increase the interim
dividend by 6.7%, especially given the decision to pay a lower
overall dividend last year as a result of the uncertainties caused
by the Covid-19 pandemic.
While it is too soon to form a view on the overall dividend for
this year, as I said in my statement in July we are keenly aware
how important investment income is to many shareholders and we are
determined to return to our progressive dividend policy as soon as
practicable. While we are encouraged by Wynnstay's performance in
the first half of the year future increases will, of course, depend
on our financial results for the year as a whole and our assessment
of future prospects in the light of the challenging business and
economic conditions.
Share Scams
In each statement, I draw the attention of shareholders to the
risk of "share scams", arising from unsolicited telephone calls or
online offers or approaches. With this year's annual report, I also
wrote separately to shareholders on this subject in the light of a
number of share scam calls reported in the second half of July.
Shareholders have reported another series of such calls over recent
weeks and I again urge shareholders to be vigilant. Wynnstay's
website (www.wynnstayproperties.co.uk) includes a warning and a
link to other information about unsolicited calls on the Financial
Conduct Authority's website.
Annual General Meetings 2020 and 2021
As you will know, our Annual General Meeting 2020 was convened
as a closed meeting due to the Covid-19 pandemic and was held on 15
September 2020 when all the resolutions were duly passed on a poll
vote. I would like to thank all the shareholders who took the
trouble to return their proxy cards to express their voting
directions.
We are hoping that for 2021 it will be possible to arrange our
Annual General Meeting in mid-July in the usual form. The date and
venue will be notified nearer the time when we can be certain that
it can take place in the light of the conditions then
prevailing.
Finally, on behalf of the Board, I thank all shareholders for
their continued interest in and support for Wynnstay and, in these
unusual and uncertain times for all of us, wish all shareholders
and their families a Happy Christmas and a healthy and peaceful
2021.
Philip Collins
Chairman
23 November 2020
1. STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
six six Year ended
months ended months ended 25 March
29 September 29 September 2020
2020 2019 GBP'000
GBP'000 GBP'000
Property Income 1,055 1,188 2,271
Property Costs (44) (46) (116)
Administrative Costs (261) (299) (572)
-------------- -------------- ------------
Operating Income 750 843 1,583
Movement in fair value of
Investment Properties - - (1,318)
Profit on Sale of Investment
Property - 440 421
750 1,283 686
Investment Income 1 1 2
Finance Costs (213) (212) (430)
-------------- -------------- ------------
Income before Taxation 538 1,072 258
Taxation (104) (119) (135)
-------------- -------------- ------------
Income after Taxation 434 953 123
============== ============== ============
Basic and diluted earnings
per share 16.0p 35.1p 4.5p
The company has no other items of comprehensive income.
2. STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
29 September 29 September 25 March
2020 2019 2020
GBP'000 GBP'000 GBP'000
Non-Current Assets
Investment Properties 34,281 35,519 34,260
Investments 3 3 3
-------------- -------------- ----------
34,284 35,522 34,263
-------------- -------------- ----------
Current Assets
Accounts Receivable 420 108 244
Cash and Cash Equivalents 1,338 882 1,289
-------------- -------------- ----------
1,758 990 1,533
-------------- -------------- ----------
Current Liabilities
Accounts Payable (1,174) (728) (1,263)
Income Taxes Payable (343) (352) (241)
-------------- -------------- ----------
(1,518) (1,080) (1,504)
Net Current Assets 240 (90) 29
-------------- -------------- ----------
Total Assets Less Current
Liabilities
Less Current
LLiabilities 34,524 35,432 34,292
Non-Current Liabilities
Bank Loans Payable (12,500) (12,500) (12,500)
Deferred Tax Payable (315) (421) (314)
-------------- -------------- ----------
(12,815) (12,921) (12,814)
Net Assets 21,709 22,511 21,478
============== ============== ==========
Share Capital 789 789 789
Capital Redemption Reserve 205 205 205
Share Premium Account 1,135 1,135 1,135
Treasury shares (1,570) (1,570) (1,570)
Retained Earnings 21,151 21,952 20,919
-------------- -------------- ----------
21,709 22,511 21,478
============== ============== ==========
Net Asset Value per share 800p 830p 792p
3. STATEMENT OF CASHFLOW
Unaudited Unaudited Audited
six six Year ended
months ended months ended 25 March
29 September 29 September 2020
2020 2019 GBP'000
GBP'000 GBP'000
Cashflow from operating activities
Income before taxation 538 1,072 258
Adjusted for:
Decrease in fair value of investment
properties - - (1,318)
Interest income (1) (1) (2)
Interest expense 213 212 430
Profit on disposal of investment
properties - (440) (421)
Changes in:
Trade and other receivables (176) 49 (88)
Trade and other payables (89) (451) 71
------------- ------------- -----------
Cash generated from operations 485 441 1,566
Income taxes paid - - (241)
Interest paid (213) (212) (430)
------------- ------------- -----------
Net cash from operating activities 272 229 895
============= ============= ===========
Cashflow from investing activities
Interest and other income received 1 1 2
Purchase of investment properties (21) (1,952) (2,014)
Sale of investment properties - 1,970 1,975
Net cash from investing activities (20) 19 (37)
============= ============= ===========
Cashflow from financing activities
Dividends paid (203) (325) (528)
Drawdown on bank loans - 2,000 -
Repayment of bank loans - (2,000) -
------------- ------------- -----------
Net cash from financing activities (203) (325) (528)
============= ============= ===========
Increase/(decrease) in cash and
cash equivalents 49 (77) 330
------------- ------------- -----------
Cash and cash equivalents at
beginning of period 1,289 959 959
Cash and cash equivalents at
end of period 1,338 882 1,289
============= ============= ===========
4. STATEMENT OF CHANGES IN EQUITY
UNAUDITED SIX MONTHSED 29 SEPTEMBER 2020
Share Capital Share Treasury Retained Total
Capital Redemption Premium Shares Earnings
Reserve Account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 26 March 2020 789 205 1,135 (1,570) 20,919 21,478
Total comprehensive income
for the period - - - - 434 434
Dividends - - - - (203) (203)
---------------------------- ----------- ----------- ----------- ----------- --------- -------
Balance as at 29 September
2020 789 205 1,135 (1,570) 21,150 21,709
============================ =========== =========== =========== =========== ========= =======
UNAUDITED SIX MONTHSED 29 SEPTEMBER 2019
Share Capital Share Treasury Retained Total
Capital Redemption Premium Shares Earnings
Reserve Account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 26 March 2019 789 205 1,135 (1,570) 21,324 21,883
Total comprehensive income
for the period - - - - 953 953
Dividends - - - - (325) (325)
---------------------------- ----------- ----------- ----------- ----------- --------- -------
Balance as at 29 September
2019 789 205 1,135 (1,570) 21,952 22,511
============================ =========== =========== =========== =========== ========= =======
AUDITED YEARED 25 MARCH 2020
Share Capital Share Treasury Retained Total
Capital Redemption Premium Shares Earnings
Reserve Account
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 26 March 2019 789 205 1,135 (1,570) 21,324 21,883
Total comprehensive income
for the year - - - - 123 123
Dividends - - - - (528) (528)
---------------------------- ----------- ----------- ----------- ----------- --------- -------
Balance as at 25 March 2020 789 205 1,135 (1,570) 20,919 21,478
============================ =========== =========== =========== =========== ========= =======
5. ACCOUNTING POLICIES
Wynnstay Properties PLC is a public limited company incorporated
and domiciled in England and Wales. The principal activity of the
company is property investment, development and management. The
Company's ordinary shares are traded on the Alternative Investment
Market.
Basis of Preparation
These unaudited condensed interim financial statements have been
prepared in accordance with International Financial Reporting
Standard ("IFRS") IAS 34 Interim Financial Reporting. They do not
constitute statutory accounts within the meaning of section 435 of
the Companies Act 2006.
The unaudited condensed interim financial statements should be
read in conjunction with the financial statements of the Company as
at and for the year ended 25 March 2020 which were prepared in
accordance with IFRS as adopted by the European Union. The
financial information for the 6 month periods ended 29 September
2020 and 29 September 2019 have not been audited and the auditors
have not reported on or reviewed these interim financial
statements. The information for the year ended 25 March 2020 has
been extracted from the latest published audited financial
statements.
Key Sources of Estimation Uncertainty
The preparation of the financial statements requires management
to make judgements, estimates and assumptions that may affect the
application of accounting policies and the reported amounts of
assets and liabilities, income and expenses.
Revisions to accounting estimates are recognised in the period
in which the estimate is revised if the revision affects only that
period. 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 those relating to the fair value of investment properties. It
is considered too early to assess the impact of the Covid-19
pandemic and the UK Government's lockdown and other measures on the
Company and its business.
Investment Properties
All the Company's investment properties are independently
revalued annually and stated at fair value at 25 March. The
aggregate of any resulting increases or decreases are taken to
operating income within the Statement of Comprehensive Income.
Investment properties are recognised as acquisitions or disposals
based on the date of contract completion.
Depreciation
In accordance with IAS 40, freehold investment properties are
included in the Statement of Financial Position at fair value, and
are not depreciated. The Company has no other plant and
equipment.
Disposal of Investments
The gains and losses on the disposal of investment properties
and other investments are included in the Statement of
Comprehensive Income in the year of disposal.
Property Income
Property income is recognised on a straight line basis over the
period of the lease and is measured at the fair value of the
consideration receivable. Lease deposits are held in separate
designated deposit accounts and are thus not treated as assets of
the Company in the financial statements. All income is derived in
the United Kingdom.
Taxation
The tax expense represents the sum of the tax currently payable
and deferred tax. Current tax is the expected tax payable on the
taxable income for the period based on the tax rate enacted or
substantively enacted at the reporting date, and any adjustment to
tax payable in respect of prior years. Taxable profit differs from
income before tax because it excludes items of income or expense
that are deductible in other years, and it further excludes items
that are never taxable or deductible.
Deferred taxation is the tax expected to be payable or
recoverable on differences between the carrying amounts of assets
and liabilities in the financial statements and the corresponding
tax bases used in the computation of taxable profits, and is
accounted for using the statement of financial position liability
method. Deferred tax liabilities are recognised for all taxable
temporary differences (including unrealised gains on revaluation of
investment properties) and deferred tax assets are recognised to
the extent that it is probable that taxable profits will be
available against which deductible temporary differences can be
utilised.
The Company provides for deferred tax on investment properties
by reference to the tax that would be due on the sale of the
investment properties. Deferred tax is calculated at the rates that
are expected to apply in the period when the liability is settled,
or the asset is realised. Deferred tax is charged or credited to
Income after Taxation, including deferred tax on the revaluation of
investment properties.
Trade and other accounts receivable
Trade and other receivables are initially measured at fair value
and subsequently measured at amortised cost as reduced by
appropriate allowances for expected credit losses. All receivables
do not carry any interest and are short term in nature.
Cash and cash equivalents
Cash comprises cash at bank and on demand deposits. Cash
equivalents are short term (less than three months from inception),
repayable on demand and are subject to an insignificant risk of
change in value.
Trade and other accounts payable
Trade and other payables are initially measured at fair value
and subsequently measured at amortised cost. All trade and other
accounts payable are non-interest bearing.
Comparative information
The information for the year ended 25 March 2020 has been
extracted from the latest published audited financial
statements.
Pensions
Pension contributions towards an employee's pension plan are
charged to the statement of comprehensive income as incurred. The
pension plan is a defined contribution scheme.
Borrowings
Interest rate borrowings are recognised at fair value, being
proceeds received less any directly attributable transaction costs.
Borrowings are subsequently stated at amortised cost. Any
difference between the proceeds (net of transaction costs) and the
redemption value is recognised in profit or loss over the period of
the borrowings using the effective interest method. Borrowings are
classified as current liabilities unless the Company has an
unconditional right to defer settlement of the liability for at
least 12 months after the reporting date.
Dilapidations
Dilapidations payments received from tenants are held in
provision until such time as they are expended.
6. DIVIDENDS
Payment Per share Amount paid/proposed
Date (pence) GBP'000
Period
6 months to 29 September 2020 18 December 2020 8.00 217
6 months to 29 September 2019 20 December 2019 7.50 203
Year ended 25 March 2020 17 July 2020 7.50 203
7. EARNINGS AND NET ASSET VALUE PER SHARE
Basic earnings per share are calculated by dividing income after
taxation attributable to Ordinary Shareholders of GBP434,000 (2019:
GBP953,000), and net asset value per share is calculated by
dividing net assets of GBP21,709,000 (2019: GBP22,511,000), in each
case by the weighted average number of 2,711,617 (2019: 2,711,617)
ordinary shares in issue during the period excluding shares held in
treasury. There are no options and no instruments in issue that
would have the effect of diluting earnings per share.
For further information please contact:
Wynnstay Properties Plc:
Philip Collins, Chairman
020 7554 8766
Panmure Gordon (UK) Limited (Nominated Adviser and Broker):
Alina Vaskina / Sandy Clark
020 7886 2500
LEI number: 2138006MASI24JYW5076
For more information on Wynnstay, visit
www.wynnstayproperties.co.uk
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