RNS Number : 5786H
Wynnstay Properties PLC
06 November 2008
Wynnstay Properties PLC
Interim Results for the six months ended 29th September 2008
Chairman's Statement
During a period of unprecedented financial and economic turmoil, I am pleased to report that your Company continues to perform well and
remains in sound health.
The Aylesford acquisition detailed in my last statement and at the Annual General Meeting is now fully integrated into the property
portfolio, and the expanded portfolio is fully let. We have increased our rental income over the same period last year and have collected
all rental income due for the first half of the year, at the same time keeping overheads substantially below the same period last year.
In prior years, we have not revalued the portfolio at the interim stage, but in view of market conditions your Board decided that this
would be a prudent step this year. Under United Kingdom Generally Accepted Accounting Principles (UKGAAP) any revaluation adjustment,
upwards or downwards, would be reflected in the balance sheet, rather than in the profit and loss account or income statement. However,
since we are now required to prepare our financial statements under International Financial Reporting Standards (IFRS), rather than under
UKGAAP, we are obliged under IFRS to reflect any revaluation adjustment in full in our income statement which thus impacts on profits and
earnings rather than only on net asset value per share.
Our Independent Valuers, Sanderson Weatherall, have undertaken an interim revaluation of the entire portfolio as at 29 September 2008
which has resulted in a valuation of �24.1m, a fall of 8.1% on the valuation as at 25 March 2008. Whilst the impact of this interim
revaluation on profits, earnings and net asset value per share as reported for IFRS purposes is significant, it should be stressed that it
reflects changes in market conditions and does not reflect the underlying performance of the Company's core business of managing and
securing rental income from its portfolio.
The results for the six months to 29th September 2008 may be summarised as follows:-
2008 2007
Operating income before movement in fair
value of +34% �585,000 �438,000
investment properties
Net(Expense)/Income on Ordinary Activities (� 1,712, 000) �334,000
before Taxation
Earnings per share (49p) 12.3p
Interim Dividend per share +6 % 2.75p 2.6p
Net Asset value per share - 7 % 494p 534p
Adjusted net asset value per share+ -10 % 509p 567p
+ Adjusted net asset value per share is net asset value per share determined in accordance with International Financial Reporting
Standards and adjusted to exclude the liability for capital gains tax on unrealised gains arising on the revaluation of the investment
portfolio.
Property income was significantly higher than for the same period last year reflecting rent reviews and new leases completed, coupled
with the inclusion for the first time of the industrial estate at Aylesford which we purchased in June 2008. Property costs were higher
than last year, reflecting the fact that we have incurred fees in undertaking investigations and refining plans for a redevelopment of our
Twickenham property which are referred to below. Administrative costs are significantly lower as a result of the cost reduction exercise
undertaken in 2007. Interest costs reflect increased borrowings following the purchase of the Aylesford estate.
The most significant development in the portfolio, apart from the Aylesford acquisition about which I wrote in my statement accompanying
the financial statements in June, is that we applied for planning permission to redevelop our industrial units at Twickenham. These units
are located in an area that is predominantly residential and are currently let to four tenants on leases, of which some expire in 2009.
After detailed consultation with the local planning authority, we submitted an application for a mixed residential and commercial
development comprising five houses, three one bedroom apartments at the front of the site and a two storey commercial office building to the
rear with new access, landscaping and parking. I am pleased to report that planning permission was granted by the Planning Committee of the
London Borough of Richmond Upon Thames on 30th October. We will continue to investigate possibilities that may exist for further enhancing
the value of this site from a planning and development point of view.
In the current climate of financial and economic uncertainty, it is difficult if not impossible to predict how events may affect your
Company particularly as the UK may be entering what may be a prolonged recession which may affect adversely the businesses of our tenants.
We will continue to monitor the situation and liaise with all our tenants closely. As already noted, the entire portfolio at present is
fully let and income producing. We also have some significant ongoing rent review negotiations. In addition to the major planning
application at Twickenham, we have also applied for a change of use of the upper parts of office premises in Colchester so that we can
consider a possible residential conversion if that should be beneficial. We will continue to seek out opportunities to expand the portfolio
if suitable opportunities present themselves.
In the light of the results described above, the Directors have decided to declare an interim dividend of 2.75p per share, representing
an increase of 6% over last year. This will be paid on 12th December 2008 to those Shareholders on the register on 14th November 2008.
Whilst we will, as always, have to take a decision 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.
We recorded an excellent attendance, including from new shareholders, at the Annual General Meeting in July and received constructive
positive feedback on the new format adopted. The event gave those Shareholders who attended a first sight of the Company's new acquisition
at Aylesford in which considerable interest was expressed. I would remind you that our website, www.wynnstayproperties.co.uk, contains
details of the portfolio as well as providing information on the share price.
Our Annual General Meeting next year will again be held at the Royal Automobile Club, 89 Pall Mall, London SW1 on Wednesday 15th July
2009 at 12 noon and I look forward to meeting as many shareholders as possible at that time.
Finally, on behalf of the Board, I would like to thank all Shareholders for their continued interest in, and support for, Wynnstay, and
to convey our best wishes for Christmas and for 2009.
Philip G.H. Collins
Chairman
5th November 2008
Enquiries:
Paul Williams, Managing Director, Wynnstay Properties PLC - 020 7745 7160
Rick Thompson, Nominated Adviser & Broker, Charles Stanley Securities - 020 7149 6000
UNAUDITED CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS ENDED 29TH SEPTEMBER 2008
Six months ended Year ended
29th September 29th September 25th
March
2008 2007 2008
�'000 �'000 �'000
Property Income 870 786 1,565
Property Costs (64) (16) (92)
Administrative Costs (221) (332) (554)
Operating Income before
movement in fair value of
investment properties:
585 438 919
Movement in fair value of:
Investment Properties (2,106) (135)
Other investments (1) (2) (1)
Operating (Expense)/Income (1,522) 436 783
Investment Income 34 13 38
Other income 135
Finance Costs (224) (115) (229)
Net (Expense)/Income before (1,712) 334 727
Taxation
Taxation 160 55 251
Net (Expense)/ Income after (1,552) 389 978
Taxation
Dividends paid (216) (204) (286)
Retained Earnings for the (1,768) 185 692
period
Basic Earnings per share (49.2) 12.3 31.0
Normalised Earnings per Share 10.0 12.3 35.3
Net Asset value per share - 494 534 550
IFRS
Net Asset value per share - UK 509 567 572
GAAP
UNAUDITED CONSOLIDATED BALANCE SHEET AT 29TH SEPTEMBER 2008
29th September 29th September 25th March
2008 2007 2008
�'000 �'000 �'000
Non Current Assets
Investment Properties 24,060 21,515 21,380
Other property, plant and 9 15 11
equipment
Investments 2 2 3
24,071 21,532 21,394
Current Assets
Accounts Receivable 50 61 152
Cash and Cash equivalents 1,354 478 888
1,404 539 1,040
Current Liabilities
Accounts Payable (626) (594) (557)
Income Tax payable (300) - (221)
(926) (594) (778)
Net Current Assets 478 (55) 262
Total Assets Less Current
Liabilities 24,549 21,477 21,656
Non-Current Liabilities
Loans Payable (8,500) (3,600) (3,600)
Deferred Tax (454) (1,021) (693)
Net Assets 15,595 16,856 17,363
Capital and Reserves
Share Capital 789 789 789
Capital Redemption Reserve 205 205 205
Share Premium Account 1,135 1,135 1,135
Retained Earnings 13,466 14,727 15,234
Shareholders Funds 15,595 16,856 17,363
UNAUDITED CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 29TH SEPTEMBER 2008
Year ended
Six months ended 29 September 25 March
2008 2007 2008
�'000 �'000 �'000
Cashflow from operating
activities
Operating (expense)/income (1,522) 438 783
Depreciation 1 2 9
Increase in fair value of 2,106 - 135
investment properties
(Decrease) in fair value of (1) (2) (1)
investment
Decrease in accounts 102 361 269
receivables
Increase(Decrease)/ in 69 (354) (359)
accounts payables
Income tax paid - (40) (40)
Net cash from operating 755 405 796
activities
Cashflow from investing
activities
Investment income and Other 34 13 172
income received
Interest payable (218) (171) (226)
Purchase of property, plant (4,786) (2) (5)
and equipment
Net cash from investing (4,970) (160) (59)
activities
Cashflow from financing
activities
Dividends paid (216) (204) (286)
Bank loan received 4,900 - -
Repayments on bank loans - (200) (200)
Net cash from financing 4,684 (404) (486)
activities
Net increase/(decrease) in 469 (159) 251
cash and cash equivalents
Cash and cash equivalents at 888 637 637
beginning of period
Cash and cash equivalents at 1,354 478 888
end of period
STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 29TH SEPTEMBER 2008
SIX MONTHS ENDED 29 SEPTEMBER 2008
Share Capital Capital Redemption Share Premium Retained Earnings Total
Reserve Account
� 000 � 000 � 000 � 000 � 000
Balance at 26 March 2008 789 205 1,135 15,234 17,363
Net income for the period (1,552) (1,552)
Dividends (216) (216)
Balance at 29 September 2008 789 205 1,135 13,466 15,595
SIX MONTHS ENDED 29 SEPTEMBER 2007
Share Capital Capital Redemption Share Premium Retained Earnings Total
Reserve Account
� 000 � 000 � 000 � 000 � 000
Balance at 26 March 2007 789 205 1,135 14,542 16,671
Net income for the year 389 389
Dividends (204) (204)
Balance at 29 September 2007 789 205 1,135 14,727 16,856
YEAR ENDED 25 MARCH 2008
Share Capital Capital Redemption Share Premium Retained Earnings Total
Reserve Account
� 000 � 000 � 000 � 000 � 000
Balance at 26 March 2007 789 205 1,135 14,542 16,671
Net income for the year 978 978
Dividends (286) (286)
Balance at 25 March 2008 789 205 1,135 15,234 17,363
Notes
1. Accounting Policies
Wynnstay Properties PLC is a public limited company incorporated and domiciled in England and Wales. The principal activity of the
company and group is property investment, development and management. The Company's ordinary shares are traded on the Alternative Investment
Market.
The interim financial information has been prepared using the recognition and measurement principles of International Financial
Reporting Standards (IFRS).
The comparative figures represent the Group's results and cash flows for the six months ended 29th September 2007 and for the year ended
25th March 2008 under the recognition and measurement principles of IFRS.
The consolidated financial statements are presented in pounds sterling and all values are rounded to the nearest thousand (�'000) except
where otherwise indicated.
This financial information does not constitute statutory accounts as defined in section 240 of the Companies Act 1985.
The comparative financial information for the year ended 25th March 2008 was derived from information extracted from the annual report
and accounts for that period, 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 sections 237(2) or (3) of the Companies Act 1985.
Basis of Preparation and Consolidation
The Group Accounts have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European
Union.
The consolidated financial statements incorporate the financial statements of the Company and its dormant subsidiary undertaking
Wynnstay Developments Limited made up to the period end. All inter group balances, transactions, income and expenses are eliminated on
consolidation.
Investment Properties
All the Group's investment properties have been revalued and stated at fair value as at 29th September 2008. The aggregate of any
revaluation gain or loss is taken through the income statement.
Depreciation
In accordance with IAS 40, freehold and leasehold investment properties are included in the balance sheet at fair value, and are not
depreciated.
Depreciation of other plant and equipment is on a straight line basis calculated at annual rates estimated to write off each asset over
its useful life of 5 years.
Property Income
Property Income represents the accrued charges under operating leases for rental of the Group's properties and is stated net of Value
Added Tax. All income is derived in the United Kingdom.
Repairs and Renewals
Repairs and renewals are charged to the income statement as incurred.
Deferred 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 year based on the tax entered or substantially enacted at the balance sheet date, and any adjustment to tax payable in
respect of prior years. Taxable profit differs from profit before tax as reported in the income statement because it excludes items of
income or expense that are deductible in other years, and it further excludes 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
balance sheet liability method. Deferred tax liabilities are recognised for all taxable temporary differences 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.
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 in the income statement, except when it relates to items charged or credited directly to
equity, in which case the deferred tax is also dealt with in equity.
Investments
Investments in subsidiaries are stated at cost less provision for impairment. Quoted investments are recognised as held at fair value,
and are measured at subsequent reporting dates at fair value, which is either at the bid price, or the latest traded price, depending on the
convention of the exchange on which the investment is quoted.
Pensions
Pension contributions towards employees pension plans are charged to the income statement as incurred.
2. Dividends Paid
period payment date Per Share (pence) Amount absorbed �'000
6 months to 29th September 12th December 2008 2.75 87
2008
6 months to 29th September 18th December 2007 2.6 82
2007
Year ended 25th March 2008 1st August 2008 6.85 216
3. Earnings per share
The calculation of basic earnings per share is based on earnings of (�1,552,000) (September 2007; �389,000; March 2008: � 978,000) and
3,155,267 ordinary shares.
The calculation of normalised earnings per share is based on earnings of �315,000 (September 2007: �334,000; March 2008: �785,000) and
3,155,267 ordinary shares.
4. Investment Properties
29th Sept 29th Sept 25th March
2008 2007 2008
Cost �'000 �'000 �'000
Balance at 25th March 2008 21,380 21,515 21,515
Purchase 4,786 - -
Revaluation (deficit) (2,106) - (135)
Balance at 29th September 2008 24,060 21,515 21,380
This information is provided by RNS
The company news service from the London Stock Exchange
END
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