PKW Parkwood Hldgs.

Final Results PARKWOOD HOLDINGS PLC ANNOUNCEMENT OF PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2004 Parkwood Holdings plc, the public sector support services specialist, announces its preliminary results for the year ended 31 December 2004. Financial Highlights: * Turnover (excluding joint ventures) increased by 34% to �67.7 million (2003: �50.6 million) * Operating profit before goodwill amortisation* of �1.65 million (2003: � 0.91 million) * Profit before taxation of �1.40 million (2003: �0.60 million) * Earnings per share before goodwill amortisation* of 5.1 pence (2003: 2.9 pence) * Dividend for the year maintained at 2.2 pence per share (final dividend for the year 1.3 pence per share) * Group order book increased to �278 million (2003: �230 million) Key Events: * Significant increase in the size of the Group's Leisure business following the acquisition of CCL Leisure Limited in May 2004 * Excellent results from the Group's Leisure division and improved results in Glendale offset by weak results in Parkwood Healthcare and investment in PFI and PPP bidding * Financial close on a leisure PFI with Penzance District Council in March 2004 Tony Hewitt, Executive Chairman, commented: "With a much better year under our belt, confidence in the Group's future is high. Parkwood continues to invest for the long term, building on the many opportunities it now has to further increase sales and profits.". For further information, please contact: Parkwood Holdings plc Tony Hewitt, Executive Chairman 01772 627111 Charles Bithell, Finance Director 01772 627111 / 07717 630531 * goodwill amortisation - �122,000 (2003: �133,000) Notes for Editors: Parkwood Holdings plc specialises in providing outsourced service to the public sector across England and Wales under long term contracts. Its main areas of operation are as follows: * Glendale - The management of parks and open spaces for a predominantly local authority client base. This operation is being expanded into related "green" businesses such as golf management and organic waste recycling, further enhancing our proposition: "Think Green - Think Glendale". * Parkwood Leisure - The management of a diverse range of leisure facilities, again predominantly for local authority clients. This Division is also the operator or provider of services under most of the Group's contracts won under the PFI/PPP procurement process. * Parkwood Healthcare - The provision of non emergency patient transport to NHS Trusts under the "National Ambulance Service" banner, together with the provision of nurses on an agency basis to both NHS Trusts and the private sector. * Parkwood PFI Projects - The provision of PFI, PPP and other similar bids on behalf of Joint Ventures and the Group, generating long term operating business. This division is also responsible for the project management of contracts on behalf of the Group's associates and JVs and management of other funds such as the lifecycle funds associated with the project agreements. Parkwood Holdings plc PRELIMINARY RESULTS FOR THE YEAR TO 31 DECEMBER 2004 CHAIRMAN'S STATEMENT Net profits before tax in 2004 amounted to �1.4 million which was a pleasing result. The year was of strategic importance, with a significant increase in the size of the Leisure Division as a result of an acquisition and the continued diversification of the `green' business of Glendale. Parkwood is a complex business for its size. The strength of its order book and diversity of its activities provides for long term sustainability. Results Group sales increased by one third to �68 million from �51 million in the previous year. Operating profits (before goodwill amortisation of �122,000) improved in 2004 and amounted to �1.65 million with an excellent performance in the Group's Leisure Division of �1.54 million including the benefit of the acquisition of CCL Leisure Limited (before exceptional reorganisation costs of �249,000), and a commendable �1.38 million (2003: �0.81 million) in the `green services' division, Glendale. Again the Group's Healthcare division failed to perform and produced losses of �0.33 million (2003: �0.53 million). The Group's cash position improved significantly as a result of both the acquisition and improved trading and there was a positive cash inflow at the operating level of �3.6 million for the year. The Group's involvement in the construction of new leisure facilities through its PFI/PPP subsidiaries and associated companies meant that total capital expenditure including joint ventures rose to over �20 million (2003: �6 million) of which the vast majority was financed through the senior debt facility on each project. Gearing at the year end, excluding non-recourse debt relating to PFIs, amounted to 17% compared to 70% at the previous year end. Dividends The Board is keen to strengthen the Group's balance sheet and was anticipating a reduced dividend, but the better performance achieved in 2004 has enabled reserves to be increased by �0.4 million, whilst maintaining a dividend of 2.2p per share for the full year. A final dividend of 1.3p per share will therefore be paid on 13th May 2005 to all shareholders on the register on 15th April 2005. Order Book and Prospects Last year I set a new medium term order book target of �500 million and I am pleased to report that the acquisition of CCL Leisure and new business wins took the order book to �278 million (2003: �230 million) at the year end and with further wins since then it now stands at �330 million. This is a significant increase and sales in excess of �75 million are secured for 2005. The public private partnerships (PFI & PPPs) that the Group has developed in recent years require complex links with funders, architects, builders, advisors and others. As well as providing long term operating contracts these projects provide project management and investment income for the future. Continuing investment in management is planned to support the Group in bidding for PFI and PPP projects. Parkwood now has over 100 term contracts and Leisure sites of which the majority are with the public sector. We have determined that we will seek to increase our presence in the private sector and the Group will continue to invest in this task in 2005. In particular Glendale's move into the golf market will be encouraged. Management and Board There were no changes in the Group Board during the year although it has been decided that for the future the Board will be enlarged. A new non-executive director is being recruited and is expected to be appointed and take up office immediately after the AGM on 28th April 2005. Succession planning is of key importance and in September 2004 we were pleased to welcome Nick Temple-Heald as the new Managing Director of Glendale. Nick was formerly with The Scotts Company (UK) Limited where he was responsible for their UK operations and specialises in growing media. At the year end we lost the services of Liz Semain the Managing Director of Parkwood Healthcare and although no immediate replacement has been found the board has been strengthened by the temporary appointment of Peter Fair, one of Parkwood Leisure's regional directors. Staff Staff numbers increased significantly during the year as we welcomed those who joined Parkwood as a result of the acquisition of CCL Leisure. The total number of people employed by the Group peaked at over 3,800 in the summer of 2004 when all seasonal part-time and casual employees are included. All our staff are to be congratulated for the part they play in providing essential services to the communities in which we live and work. Outlook With a much better year under our belt, confidence in the Group's future is high. Parkwood continues to invest for the long term, building on the many opportunities it now has to further increase sales and profits. A W Hewitt Executive Chairman 14 March 2005 PARKWOOD HOLDINGS PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT Year Ended 31 December 2004 Existing Acquisition 2004 2003 Operations �000 Total �000 �000 �000 Turnover: Group and share of joint 58,071 10,971 69,042 51,329 ventures Less: share of joint ventures (1,385) - (1,385) (720) turnover Group Turnover - continuing 56,686 10,971 67,657 50,609 operations Cost of sales (42,843) (8,391) (51,234) (39,362) Gross profit 13,843 2,580 16,423 11,247 Administrative expenses (12,357) (2,534) (14,891) (10,466) Group operating profit before 1,620 283 1,903 914 goodwill amortisation and reorganisation costs Exceptional reorganisation costs - (249) (249) - Goodwill amortisation (134) 12 (122) (133) Group operating profit 1,486 46 1,532 781 Share of operating profit in - Associated undertaking 252 - 252 236 - Joint ventures 90 - 90 122 342 - 342 358 Total operating profit - continuing 1,828 46 1,874 1,139 operations Net interest payable and similar charges - Group (46) (143) - Associated undertaking (145) (140) - Joint ventures (281) (253) (472) (536) Profit on ordinary activities before 1,402 603 taxation Tax on profit on ordinary activities (560) (187) Profit on ordinary activities after 842 416 taxation Dividends paid and proposed (438) (396) Retained profit for the year 404 20 transferred to reserves Earnings per share - basic 4.5 p 2.2p Earnings per share before goodwill - 5.1 p 2.9p basic Earnings per share - diluted 4.5 p 2.2p The Group has no recognised gains and losses other than the result for the current and prior years. Accordingly, a statement of total recognised gains and losses has not been presented. PARKWOOD HOLDINGS PLC CONSOLIDATED BALANCE SHEET 31 December 2004 At 31 December 2004 2003 Restated �000 (note 1) �000 Fixed assets Goodwill 410 525 Negative goodwill (75) - Tangible assets 11,395 4,773 11,730 5,298 Investments in joint ventures Share of gross assets 14,291 7,207 Share of gross liabilities (14,232) (6,949) 59 258 Investment in associates 425 351 12,214 5,907 Current assets Stocks 863 518 Debtors due within one year 9,541 7,156 Debtors due after more than one year 1,456 1,256 Cash at bank and in hand 2,110 - 13,970 8,930 Creditors: amounts falling due within one year (12,876) (9,366) Net current assets/(liabilities) 1,094 (436) Total assets less current liabilities 13,308 5,471 Creditors: amounts falling due after more than one year (5,905) (1,230) Provisions for liabilities and charges (2,892) (158) 4,511 4,083 Capital and reserves Called up share capital 196 196 Investment in own shares (164) (188) Capital redemption reserve 401 401 Share premium account 2,227 2,227 Profit and loss account 1,851 1,447 Equity shareholders' funds 4,511 4,083 PARKWOOD HOLDINGS PLC SUMMARY CASH FLOW STATEMENT Year ended 31 December 2004 2004 2003 �000 �000 Net cash inflow from operating activities 3,617 2,724 Net cash outflow from returns on investments (46) (143) and servicing of finance UK corporation tax paid (173) (173) Net expenditure on tangible fixed assets (5,325) (814) Subordinated debt repaid by/(invested in) joint 3 (413) ventures and associated undertaking Sale of own shares by Employee Benefit Trust 24 43 Net cash outflow from capital expenditure and (5,298) (1,184) financial investment Net cash inflow/(outflow) from acquisitions and 1,750 (64) disposals Equity dividends paid (401) (413) Net cash (outflow)/inflow before financing (551) 747 Capital element of finance lease rental (1,107) (982) payments Bank loan 4,458 - Increase / (decrease) in cash in the year 2,800 (235) RECONCILIATION OF NET CASHFLOW MOVEMENT TO NET DEBT 2004 2003 �000 �000 Increase/(decrease) in cash in the year 2,800 (235) Cash outflow from reduction in debt and lease 1,107 982 financing Movement on bank loan (4,458) - Change in net debt resulting from cashflows (551) 747 New finance leases (1,301) (1,500) Increase in net debt (1,852) (753) Net debt at 1 January (2,877) (2,124) Net debt at 31 December (4,729) (2,877) Notes 1. Results and Accounting Policies The preliminary results for the year ended 31st December 2004 were approved by the board of directors on 14 March 2005. The financial information set out above does not constitute the Company's statutory accounts for the year ended 31 December 2004 or 2003 as detailed in section 240 of the Companies Act 1985, but is derived from those accounts. Statutory accounts for 2003 have been delivered to the Registrar of Companies and those for 2004 will be delivered following the Company's annual general meeting. The auditors have reported on these accounts; their report was unqualified and did not contain a statement under s237(2) or (3) of the Companies Act 1985. The preliminary announcement has been prepared in accordance with applicable United Kingdom accounting standards under the historical cost convention. The principal accounting policies of the Group have remained unchanged from those set out in the Group's 2003 annual report and financial statements with the exception of the adoption of UITF Abstract 38. "Accounting for ESOP trusts", where investments in own shares have been reclassified to shareholders' funds in both current and comparative periods. 2. Analysis of Turnover, profit before tax and net assets. Turnover, profit before tax and net assets all of which originated and arose in the United Kingdom are attributable to the following classes of business: 2004 Turnover Profit before Net assets/ tax �000 (liabilities) �000 * �000 Leisure 26,463 1,543 (1,997) Glendale 34,858 1,375 3,998 Parkwood Healthcare 5,891 (334) 1,049 Parkwood PFI Projects 384 (205) 658 Other 61 (476) 803 67,657 4,511 Operating profit before goodwill amortisation and 1,903 reorganisation costs CCL Leisure - exceptional reorganisation costs (249) Goodwill amortisation (122) Share of net profit in joint ventures and (84) associated undertaking Group interest payable (46) Profit before taxation 1,402 2003 Turnover Profit before Net assets/ tax �000 (liabilities) �000 �000 Leisure 14,414 947 (636) Glendale 29,074 814 4,118 Parkwood Healthcare 6,803 (529) 1,169 Parkwood PFI Projects 277 - - Other 41 (318) (568) 50,609 4,083 Operating profit before goodwill 914 amortisation Goodwill amortisation (133) Share of net loss in joint ventures and associated (35) undertaking Group interest payable (143) Profit before taxation 603 * Net assets/(liabilities) for the trading businesses excludes cash/ (borrowings) and intercompany balances. "Other" includes cash �2,110,000 (2003: overdraft�690,000). The net assets of Parkwood PFI Projects were included within "Other" in 2003 and have been separately analysed in 2004. 3. The final dividend is payable on 13th May 2005 to shareholders on the register on 15th April 2005. 4. Earnings per share for the year to 31 December 2004 have been calculated on the profit attributable to ordinary shareholders of �842,000 using the weighted average number of shares in issue during the period. 5. The Annual Report will be posted to shareholders on or around 30 March 2005. Copies will be available from: The Company Secretary, Parkwood Holdings plc, Parkwood House, Cuerden Park, Berkeley Drive, Bamber Bridge, Preston PR5 6BY The results will not be advertised in any newspaper ENDS END DATASOURCE: PARKWOOD HOLDINGS PLC

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