BLD Bulgarian Land

    RNS Number : 6757X
  Bulgarian Land Development PLC
  27 June 2008
   



    27 June 2008

    Bulgarian Land Development plc
(the "Company")
    Delay in publication of audited 2007 Report & Accounts

    The Preliminary Statement of results for the Company for the year ended 31 December 2007 was announced on 6 March 2008 (the "Preliminary
Statement"). 

    The Company's auditors have very recently advised the Directors that they have now changed their view regarding the Company's accounting
treatment of changes in the amounts of deferred payments to the vendors of land, where those payments are a percentage of the ultimate sale
proceeds of completed units. Although the auditors did not disagree with the accounting treatment used in the 2006 accounts; in the half
year to 30 June 2007 and in the Preliminary Statement, they now believe that a different accounting treatment should be applied. 

    The Company has been and continues to be actively engaged in discussion with its auditors about the appropriate accounting treatment but
regrettably the Company's Annual Report and Accounts for the year ended 31 December 2007 are not now expected to be despatched to
shareholders by 30 June 2008, the date required by AIM Rule 19.

    The Company has therefore, in accordance with the AIM Rules, requested the temporary suspension of all its Ordinary Shares pending the
publication of its audited financial statements for the year ended 31 December 2007, as these now require amendments. The Company is
focusing on agreeing the wording for the amendments in order to ensure that the suspension is for as short a time as possible and that the
final Report & Accounts will be issued as soon as practicable in July. 

    As previously announced, the Group acquired in 2006 interests in two development sites (namely Sofia Towers and Borovets), each for an
initial payment followed by further payments out of sales revenue, on an agreed formula basis. It was deemed appropriate to the Group to buy
on these terms as this has enabled the Group to acquire larger sites than would have otherwise been possible if the whole purchase price had
been paid on acquisition furthermore the Group is protected as the final cost of the sites is dependent on the ultimate sales proceeds.

    To calculate the carrying value of these deferred payments as at the balance sheet dates, estimated future amounts payable were
discounted back from the date of expected payment to the relevant balance sheet date. The discounted amount of the expected future deferred
payments on these two developments included in the audited financial statements for the year ended 31 December 2006 was �19.881 million. The
2006 accounts provided for this liability with the matching entry being in Inventories. The discounted amount included in the Preliminary
Statement of results for the Company as at 31 December 2007 was �23.945 million. This �4.064m increase arose from the unwinding of the
discount during 2007, being one year closer to the anticipated payment date. To date, the Company has accounted for the increase in the
carrying value of the liability as an addition to Inventories as well as an increase in liabilities. As the auditors now believe that a
different accounting treatment should be applied, this may result in a change in the adjustment to the carrying value of the liability mentioned above. 
    
The Company emphasises that there is no impact on cash or the profitability of the related property developments over their lifetime if a
change of accounting treatment is adopted arising from the discussions with the auditors. The relevant part of the site purchase contracts
relate to payments due to be made when sales of finished units have been completed; in neither case has construction yet begun. Such
payments would be funded out of sale receipts.  

    A further announcement will be made as soon as practicable.


    - Ends -


    For further information, please contact:


 Bulgarian Land Development
 John Dodwell                    Finance Director  020 7067 0700

 Weber Shandwick Financial                         020 7067 0700
 Terry Garrett 
 Nick Dibden
 James White

 Collins Stewart Europe Limited                    020 7523 8350
 Hugh Field / James Cassley

                        



    Editors' note 
    BLD, the Bulgarian residential and commercial development company, was admitted to the AIM market in March 2006, following a share
placing which raised gross proceeds of �23m at 100p per share. In March 2007 an additional placing raised �15m. BLD only operates in
Bulgaria which is where its full time management is based.


This information is provided by RNS
The company news service from the London Stock Exchange
 
  END 
 
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