RNS No 2153v
CARDIFF PROPERTY PLC
1st June 1998
THE CARDIFF PROPERTY PLC
(The Group, based in Egham, Surrey, develops and invests
in commercial and residential property close to Heathrow
Airport and the Western sector of the M25)
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 1998
Summary
* Turnover #445,000 (1997: #1.053m)
* Sales of investment property #435,000 (not included in
turnover)
* Pre-tax profit up 14% to #240,000 (1997: #210,000)
* Earnings per share 7.0p (1997: 5.9p)
* Interim dividend up 10% to 1.1p net per share (1997:
1.0p)
* Group's current development programme totals #5m
* Developments taking place at Windsor, Bracknell, Egham
and Hambledon
* New office letting to Fairey Group Plc at #160,000
p.a. now completed
* 17,000 sq. ft. of Group's office building at Burnham
let at #24.00 per sq. ft.
* Net assets 323p per share - (properties not re-valued
at half year).
Richard Wollenberg, Chairman, commented:
"The demand for modern high quality office space in the
Heathrow area remains strong. Numerous pre-lets and
owner occupier purchases have recently been completed in
the Thames Valley and a supply shortage is still evident.
The Group's development programme is well advanced and
should achieve further progress in the coming months."
For Further Information
The Cardiff Property Plc
Richard Wollenberg 01784 437444
Albert E Sharp
Will Martin 0171 638 7275
Binns & Co Public Relations
Brian Coleman-Smith 0171 786 9600
Chairman's Interim Statement
Results
Further positive progress has been achieved since the
year-end. Profit on ordinary activities before tax for
the half year to 31 March 1998 amounted to #240,000
(1997: #210,000) an increase of 14%. Turnover totalled
#445,000 (1997: #1.035m), which included gross rental
income #387,000 (1997: #388,000), and sales of
development property #58,000 (1997: #665,000). Proceeds
of sale of investment property not included in the
turnover figures totalled #435,000. Disposal of part of
our listed investment realised proceeds of #285,000. The
Group's share of profits from our 47.62% owned associate
undertaking, Campmoss Property Company Ltd, contributed
#12,000 (1997: #71,000).
Earnings per share amounted to 7.0p (1997: 5.9p). Your
board has declared an interim dividend of 1.1p per share
(1997: 1.0p), an increase of 10%.
The interim dividend is payable on 31 July 1998 to
shareholders on the register on 3 July 1998.
The Property Market
(close to Heathrow Airport and the western sector of the
M25 motorway)
As evidenced by our own success in achieving various
lettings, the demand for high quality office space within
the Group's area of operation remains strong. A number of
companies, especially those within the service sector,
are leasing more space than they initially require. A
strong UK economy and encouraging business environment
allow such companies to plan for future expansion, part
of the space being sub-let in the interim period.
A supply shortage of prime office space is still evident.
This has inevitably encouraged further development to
take place, but the underlying strength of the market has
been demonstrated by a series of recent announcements
confirming a substantial number of pre-lets. Numerous
high profile lettings and owner occupier purchases within
the Thames Valley have been completed and it is commonly
accepted by the market place that lease terms are now for
a minimum 15 years.
Investment yields remain attractive relative to long term
gilts and most other fixed interest investments.
Furthermore the prospect of increased rental returns is
attracting the attention of many private and overseas
funds.
For investors and occupiers, the office investment market
in the M4 corridor has returned to the level of
popularity enjoyed during the late 1980s. Although
speculative development is not at levels seen at that
time, I expect a period of consolidation to take place.
The expectation of low long-term interest rates should,
however, contribute to property remaining an attractive
investment.
Financial
At the half year, based on September 1997 property
values, net assets including our share of Campmoss
Property totalled #10.7m, equivalent to 323p per share.
Since September last year, the Group has progressed its
substantial development programme and achieved a number
of lettings and planning permissions. Existing cash and
borrowing facilities are being used to fund the Group's
development costs and additional facilities have been
negotiated to allow further acquisitions to take place.
Gearing at the half year was 44% against 50% at the year-
end.
Our quoted investment in the retail warehouse sector has
been the subject of a recent take-over offer with the
market value substantially increasing since the year-end.
The Investment Portfolio
At Station Road, Egham, the pre-letting of our recently
built 8,000 sq. ft. net office building to Fairey Group
plc has been completed. Annual rental of #160,000 will
commence in July this year.
At Hatton Cross, close to Heathrow Airport, new lease
terms at our 3,000 sq. ft. net office building have been
agreed with the existing tenant. Annual rental,
commencing November this year, is anticipated at #75,840,
an increase of 20%.
The Group's associate company Campmoss Property has
recently let 17,000 sq. ft. at "The Priory", Burnham, our
26,000 sq. ft. headquarters building located between
Maidenhead and Slough. The letting on a long-term
institutional lease is for the new part of the building
and achieved an annual rental of #400,000 equivalent to
#24.00 per sq. ft.. The refurbished part of the building,
being 9,000 sq. ft., is currently under offer at #22.00
per sq. ft..
The Group's investment portfolio located at Windsor,
Egham and Woking continue to provide a secure return of
long term income with the majority of space let to good
covenants on long term institutional leases.
The Development Portfolio
The Group's property development programme, including
Campmoss Property, continues to gather momentum. Sites
under construction include 35,000 sq. ft. industrial and
office space at Bracknell, 20,000 sq. ft. industrial and
office space at Windsor and 9,000 sq. ft. new and
refurbished office space at Redhill.
Detailed planning consent for a new office scheme at
Woking has been obtained. The development will comprise
12,500 sq. ft. of new space with the existing building of
3,000 sq. ft. being refurbished. Discussions are well
advanced with a prospective plc tenant. A planning
application has also been submitted in respect of a new
office scheme at the Group's property at Bracknell.
Our residential development programme is similarly well
advanced. Construction of a 6 bedroom country house at
Hambledon, Surrey and 7 flats at Egham, Surrey has
commenced and completion is expected by the end of this
calendar year.
At Windsor a revised planning application for a
residential scheme has been submitted and, meanwhile, we
continue to await the outcome of our planning appeal for
21 flats.
Outlook
The Group's construction and development programme
remains at the forefront of your directors' daily
activities. Our current development programme, including
Campmoss Property, costing #5m should add significantly
to gross rental income and capital value when completed.
The sale or investment value of these properties is
expected to be in excess of #12m. In the event that we
achieve planning consents at Bracknell and Windsor these
figures should substantially increase over the next
twelve months.
Your directors are keen to increase the Group's
development projects and are currently involved in
negotiations to acquire two freehold properties.
I remain confident that the Group's current activities
are correctly focused and that further progress will be
achieved in the coming months. I look forward to
reporting to you with the year end figures.
J Richard Wollenberg
Chairman
1 June 1998
Consolidated Profit and Loss Account
for the six months ended 31 March 1998
Six Six Year to
months months 30
31 March 31 September
1998 March 1997
(Unaudited) 1997 (Audited)
(Unaudited) #'000
#'000 #'000
Turnover (note 2) 445 1,053 2,923
Cost of sales (119) (700) (2,103)
------- ------- -------
Gross profit 326 353 820
Administrative expenses (195) (166) (380)
Other operating income 76 64 109
------- ------- -------
Operating profit 207 251 549
Income from interest in 12 71 59
associated undertaking
Profit on sale of
investment property 27 - 5
Property on sale of
other investments 133 - 87
------- ------- -------
Profit on ordinary activities
before interest 379 322 700
Interest receivable and
similar income 51 20 90
Interest payable (190) (132) (316)
------- ------- -------
Profit on ordinary activities
before taxation 240 210 474
Tax on profit on ordinary
activities (note3) (9) (13) (21)
------- ------- -------
Profit after taxation
for the period 231 197 453
Dividends (note 4) (36) (33) (103)
------- ------- -------
Retained profit for
the period 195 164 350
------- ------- -------
Earnings per share 7.0p 5.9p 13.7p
====== ====== ======
Consolidated Balance Sheet
at 31 March 1998
31 March 31 March 30
1998 1997 September
(Unaudited)(Unaudited) 1997
(Audited)
#'000 #'000 #'000
Fixed assets
Tangible assets
Investment properties 10,241 8,495 8,310
Other 59 50 1,644
------- ------- -------
10,300 8,545 9,954
Investments 2,383 2,193 2,371
------- -------- --------
12,683 10,738 12,325
Current assets
Stock and work in progress 1,203 1,425 1,018
Debtors 2,268 1,126 3,145
Investments 50 45 50
Cash at bank and in hand 7 38 6
3,528 2,634 4,219
Creditors: amounts
falling due within one (2,286) (1,240) (2,875)
year
Creditors: amounts falling
due after more than one (3,200) (3,200) (3,139)
year -------- ------- -------
Net assets 10,725 8,932 10,530
------- ------- -------
Capital and reserves
Called up share capital 664 664 664
Share premium account 4,810 4,810 4,810
Investment property
revaluation reserve 1,003 (460) 165
Other revaluation reserve - - 773
Other reserves 1,969 1,969 1,969
Profit and loss account 2,279 1,949 2,149
------- ------- -------
Shareholders' funds 10,725 8,932 10,530
------- ------- -------
Consolidated Cash Flow Statement
for the six months ended 31 March 1998
Six Six Year to
months months 30
31 March 31 March September
1998 1997 1997
(Unaudited) (Unaudited) (Audited)
#'000 #'000 #'000
Cash inflow/(outflow) from
operating activities 926 (185) (1,316)
Returns on investment and
servicing of finance (139) (102) (251)
Taxation - 5 (2)
Capital expenditure and
financial investment (185) (709) (807)
Equity dividends paid (70) (65) (98)
------- ------- -------
Cash inflow/(outflow)
before financing 532 (1,056) (2,474)
Financing (950) - 1,300
------- ------- -------
Decrease in cash (418) (1,056) (1,174)
------- ------- -------
Notes to the Financial Information
1. Basis of preparation
The figures for the half-year ended 31 March 1998 are
prepared on the same basis of accounting as for the year
ended 30 September 1997 and are unaudited.
The figures for the year ended 30 September 1997 are
extracted from the statutory accounts for that year,
which have been filed with the Registrar of Companies and
on which the auditors gave an unqualified report, without
any statement under section 237(2) or (3) of the
Companies Act 1985.
2. Analysis of turnover and profit on ordinary activities
before taxation
Six Six months Year to
months 31 March 30
31 March 1997 September
1998 (Unaudited) 1997
(Unaudited) (Audited)
#'000 #'000 #'000
Turnover
(wholly in the United
Kingdom): 387 388 807
Gross rents receivable 58 665 2116
Sales of development
properties
------- ------- -------
445 1,053 2,923
------- ------- -------
Profit on ordinary activities
before interest and taxation:
Property investment 318 232 463
Property development 60 90 237
------- ------- -------
378 322 700
------- ------- -------
Net operating assets:
Property investment 7,175 5,605 7,018
Property development 3,550 3,327 3,512
-------- -------- -------
10,725 8,932 10,530
-------- -------- -------
3. Taxation
The tax charge for the half-year is estimated on the
basis of the anticipated tax rates applying for the full
year.
4. Dividends
Year to Year to
30 September 30
1998 September
#'000 1997
#'000
Interim 1.1p per share 36 1.0p per share 33
Final - 2.1p per share 70
---------- ----------
36 103
---------- ----------
The interim dividend of 1.1p per share will be paid on 31
July 1998 to shareholders on the register on 3 July 1998.
5. Earnings per share
Earnings per share has been calculated by dividing the
profit after tax for the period of #231,000 (March 1997:
#197,000; September 1997: #453,000) by the weighted
average number of ordinary shares in issue during the
period 3,317,514 (March and September 1997: 3,317,514).
Financial Calendar
1998 1 June Interim results for 1997/98
announced
3 July Record date for interim dividend
31 July Interim dividend to be paid
30 End of accounting year
September
1999 January Preliminary announcement of 1997/98
results
March Annual general meeting
March Final dividend to be paid
Directors and Advisers
Directors Auditors
J Richard Wollenberg, KPMG Audit plc
chairman and chief executive
David A Whitaker FCA, Bankers
finance director Midland Bank plc
Nigel D Jamieson BSc, ARICS,
MSI(Dip),
non-executive director Financial advisers and
stockbrokers
Albert E Sharp
Secretary
David A Whitaker FCA Solicitors
Charles Russell
Non-executive directors of wholly Morgan Bruce
owned subsidiaries
First Choice Estates plc
Derek M Joseph BCom, FCIS, MIMC, Public relations
MBIM
Binns & Co Public Relations
Limited
Thames Valley Retirement Homes Ltd
Richard S G Sale MA, LLB(Cantab) Registrar and transfer
office
Computershare Services plc
Head office PO Box 82
56 Station Road Caxton House
Egham TW20 9LF Redcliffe Way
Telephone: 01784 437444 Bristol BS99 7NH
Fax:01784 439157 Telephone: 0117 930 6666
Registered office
Marlborough House
Fitzalan Court
Fitzalan Road
Cardiff CF2 1TE
Registered number
22705
This report is being sent to shareholders and a copy will
be available to the Public at the Company's head office
at The Cardiff Property Plc, 56 Station Road, Egham,
Surrey TW20 9LF.
END
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