Interim Results
November 22 2006 - 4:43AM
UK Regulatory
RNS Number:4954M
Wynnstay Properties PLC
22 November 2006
Wynnstay Properties PLC ("Wynnstay" or "the Company")
Interim Results for the six months ended 29th September 2006
Chairman's Statement
I am pleased to report increased profits and earnings per share, despite lower
property income, compared with the interim results last year. Although we do
not carry out a revaluation at the interim stage, net asset value per share
reflects the property valuation conducted in March 2006 and is thus
substantially above the figure at this time last year.
The results may be summarised as follows:-
2006 2005
* Profit on Ordinary Activities before taxation: + 8.8% #283,000 #260,000
* Earnings per share: + 8.6% 6.3p 5.8p
* Interim dividend per share: + 6.5% 2.45p 2.3p
* Net asset value per share: + 14.6% 432p 377p
As anticipated, property income was lower in the first half, mainly as a
consequence of the Epsom property remaining vacant following the lease expiry in
September 2005. However, this was partially offset by a full contribution from
the letting of the vacant unit at Basingstoke and the letting of three recently
refurbished industrial units at St. Neots as well as from satisfactory rent
review settlements achieved elsewhere in the portfolio.
You will recall that we made an application for planning consent in relation to
the Epsom property, involving the construction of an additional fifth floor and
the conversion of the four upper floors for residential use, to comprise 15
apartments, with commercial use retained on the ground floor only. Those
Shareholders who were able to attend the Annual General Meeting in July were
able to see our plans for the property, which generated a considerable degree of
interest. I am pleased to report that permission for the scheme was granted
early in September. The Board reviewed the strategy and options for this
property at its meeting shortly thereafter.
We concluded that it would be in the best interests of Shareholders, having
regard to the continuing strength of the residential market and the considerable
interest expressed by a number of specialist developers for this type of
project, for the property to be sold with the benefit of the planning permission
we had obtained. Contracts were exchanged on 21st November 2006 for the sale of
this property for a cash consideration of #2,000,000. After taking account of
the settlement negotiated with the previous tenant and the design, planning and
selling costs involved, this disposal is expected to result in a net surplus
over book value of approximately #948,000, on which no tax liability should
arise. This surplus equates to 30 pence per share, which will be reflected in
the Company's financial statements for the year ending 25th March 2007. This
very profitable transaction was achieved as a result of the Company procuring a
skilfully and sensitively designed scheme for the conversion of the property to
satisfy stringent planning requirements, coupled with a professionally executed
marketing campaign.
During the first half, we examined numerous potential investment opportunities
and engaged in some detailed discussions with vendors, but no acquisitions took
place during the period. It remains difficult to acquire attractive investment
properties which provide opportunities for medium to long-term growth at prices
which can be justified. The intense competition in the market has driven prices
up to levels we consider will prove difficult to sustain. However, as I have
said before, this has the benefit that the value of your Company's properties at
the present time is being strongly sustained by these conditions which, should
they continue throughout the second half, are likely to have a positive impact
on the year end property revaluation. In the meantime, and especially with the
combination of low gearing, the unutilised element of our borrowing facilities
and the funds which will be generated from the disposal of the Epsom property,
the Company remains in a strong position to make significant investments as and
when opportunities arise or market conditions change.
Prospects for the full year appear satisfactory. Although property income is
likely to be somewhat lower than last year, we expect this to be countered by
lower overhead and interest costs. Profits will also be enhanced by the
disposal of the Epsom property.
In the light of these results, the Directors have decided to declare an interim
dividend of 2.45p per share, representing an increase of 6.5% over last year.
This will be paid on 14th December 2006 to those Shareholders on the register on
1st December 2006. Whilst we will, of course, decide on the appropriate amount
to recommend as a final dividend having regard to the results for the full year,
the Board is hopeful that this will reflect a similar percentage increase.
The financial statements included in this report have been prepared in
accordance with accounting standard FRS 21 which requires that dividends
declared after the balance sheet date are not recognised as a liability. This
means they include the final dividend for the last financial year paid in August
2006, but not the interim dividend payable in December 2006. Further, they do
not reflect the release of deferred tax provisions no longer required, amounting
to #159,000, which will be reflected in the accounts for the full year.
I am extremely sorry to report that our Finance Director, Peter Kirkland, has
decided to retire at the age of 60. Peter has steered Wynnstay skilfully
through a period of great change over the last 12 years. We are indebted to him
for his commitment and loyalty and we will miss his breadth of experience and
wise counsel. I will include a fuller tribute to him in my annual statement.
We are in the course of recruiting his successor and an announcement will be
made in due course.
A record number of Shareholders were able to attend the Annual General Meeting
in July. The meeting provides a valuable opportunity for the Directors to talk
with Shareholders both formally and informally and to gauge interest in the
Company and its future. It also provides an occasion at which Shareholders can
discuss the Company's progress with each other. Our Annual General Meeting next
year will again be held at the Royal Automobile Club, 89 Pall Mall, London SW1
on Thursday 26th July 2007 and I hope that we will once again have an excellent
attendance.
Philip G.H. Collins
Chairman
22nd November 2006
Unaudited Consolidated Profit & Loss Account
Six Months ended 29th September 2006
Six Months ended Year ended
29th September 25th March
2006 2005 2006
(Unaudited) (Audited)
#'000 #'000 #'000
Turnover
Gross Rental Income 770 812 1,560
Fees and Commissions 8 8 17
-------------- -------------- --------------
778 820 1,577
Property Outgoings (30) (24) (62)
-------------- -------------- --------------
748 796 1,515
Administration and Other Costs (278) (341) (589)
-------------- -------------- --------------
Operating Profit 470 455 926
Finance Costs (Net) (187) (195) (373)
-------------- -------------- --------------
Profit on Ordinary Activities
before Taxation 283 260 553
Taxation (85) (78) (168)
-------------- -------------- --------------
Profit on Ordinary Activities
after Taxation 198 182 385
Dividends paid (see note 3) (189) (180) (253)
-------------- -------------- --------------
Profit Retained 9 2 132
-------------- -------------- --------------
Basic Earnings per share (see note 1) 6.3p 5.8p 12.2p
Unaudited Consolidated Balance Sheet
at 29th September 2006
29th September 2006 29th September 2005 25th March
(Unaudited) (Unaudited) 2006
(Audited)
#'000 #'000 #'000
Fixed Assets
Tangible Assets 20,360 18,750 20,357
Investments 1 1 1
-------------------- -------------------- --------------------
20,361 18,751 20,358
Current Assets
Debtors 98 85 35
Cash at Bank and in Hand 180 369 316
-------------------- -------------------- --------------------
278 454 351
Creditors: Amounts falling due
Within one year (679) (799) (758)
-------------------- -------------------- --------------------
Net Current Liabilities (401) (345) (407)
-------------------- -------------------- --------------------
Total Assets Less Current Liabilities 19,960 18,406 19,951
Creditors: Amounts falling due after more than
one year
(6,000) (6,200) (6,000)
-------------------- -------------------- --------------------
13,960 12,206 13,951
Provision for Liabilities and Charges (314) (304) (314)
-------------------- -------------------- --------------------
Net Assets 13,646 11,902 13,637
-------------------- -------------------- --------------------
Capital and Reserves
Share Capital 789 789 789
Capital Redemption Reserve 205 205 205
Share Premium Account 1,135 1,135 1,135
Capital Reserve 151 151 151
Revaluation Reserve 6,277 4,672 6,277
Distributable Reserves 5,089 4,950 5,080
-------------------- -------------------- --------------------
Equity Shareholders' Funds 13,646 11,902 13,637
-------------------- -------------------- --------------------
Unaudited Consolidated Cash Flow Statement
Six Months ended 29th September 2006
Six Months ended Year ended
29th September 25th March
2006 2005 2006
(Unaudited)
#'000 #'000 #'000
Cash Flow from Operating Activities (Note A) 398 521 1,004
--------------- --------------- ---------------
Returns on Investment and Servicing
of Finance
Interest Received 4 6 10
Interest Paid (258) (195) (388)
--------------- --------------- ---------------
Net Cash (Outflow) from Returns on
Investment and Servicing of Finance (254) (189) (378)
--------------- --------------- ---------------
Taxation Paid (86) (55) (127)
--------------- --------------- ---------------
Capital Expenditure and Financial
Investment
Purchase of Tangible Fixed Assets (5) (1) (3)
Disposal of Tangible Fixed Assets - 1 1
--------------- --------------- ---------------
Net Cash (Outflow) from
Investing Activities (5) - (2)
--------------- --------------- ---------------
Equity Dividends Paid (189) (180) (253)
--------------- --------------- ---------------
Net Cash (Outflow)/Inflow before Financing (136) 97 244
Financing
Repayment of Bank Loan - - (200)
--------------- --------------- ---------------
(Decrease)/Increase in Cash in the Period (136) 97 44
--------------- --------------- ---------------
Reconciliation of Net Cash Flow to
Movement in Net Debt
(Decrease)/Increase in Cash in the Period (136) 97 44
Cash Inflow from Debt Financing - - 200
--------------- --------------- ---------------
Movement in Net Debt in the Period (136) 97 244
Net Debt at 25th March 2006 (5,684) (5,928) (5,928)
--------------- --------------- ---------------
Net Debt at 29th September 2006 (Note B) (5,820) (5,831) (5,684)
--------------- --------------- ---------------
Notes To Cash Flow Statement
A. Reconciliation of Operating Profit to Net Cash Inflow from Operating
Activities
Six Months ended Year ended
29th September 25th March
2006 2005 2006
#'000 #'000 #'000
Operating Profit 470 455 926
Depreciation and Amortisation 2 1 2
(Increase)/Decrease in Debtors (63) (1) 49
(Decrease)/Increase in Creditors (11) 66 27
-------------- -------------- --------------
Net Cash Inflow from Operating Activities 398 521 1,004
-------------- -------------- --------------
B. Analysis of Net Debt
29th September
2006 Cash Movement 25th March 2006
#'000 #'000 #'000
Cash at Bank and in Hand 180 (136) 316
Debt due after more than one year (6,000) - (6,000)
--------------- --------------- ---------------
Net Debt (5,820) (136) (5,684)
--------------- --------------- ---------------
Notes
1. Basic earnings per share have been calculated on profits after taxation
attributable to Ordinary Shareholders of #198,000 (2005: #182,000) and on
3,155,267 ordinary shares, being the weighted average number in issue during
both periods.
2. The figures in these statements do not constitute statutory accounts;
those for the year ended 25th March 2006 are extracted from the Group Accounts
which have been filed with the Registrar of Companies and which received an
unqualified report from the Auditors and did not contain a statement under
Section 237(2) or (3) of the Companies Act 1985 as amended.
3. An interim dividend of 2.45p per share, amounting to #77,000, will be
paid on 14th December 2006 to those Shareholders on the register at 1st December
2006. A final dividend of 6.0p per share in respect of the year ended 25th
March 2006, was paid to Shareholders on 3rd August 2006 and the cost amounting
to #189,000 has been included in the Profit and Loss Account for the half year
ended 29th September 2006.
4. This interim report is being posted to all Shareholders and will be
available free of charge until 31st December 2006 on application to the
Company's registered office at Cleary Court, 21 St. Swithin's Lane, London EC4N
8AD.
This information is provided by RNS
The company news service from the London Stock Exchange
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