TIDMRES
RNS Number : 0057R
Rugby Estates PLC
28 October 2011
28 October 2011
RUGBY ESTATES PLC
("Rugby", the "Group" or the "Company"),
Half Year Results for the six months ended 31 July 2011
Rugby Estates Plc, the property and asset management group,
today announces half yearly results for the six months ended 31
July 2011.
Highlights:
-- Ongoing progress in implementing the Company's strategic
decision to dispose of the Group's property portfolio and return
proceeds to shareholders:
- GBP3.8 million realised through property disposals during the period
- Cash payments totalling GBP4.6 million made to shareholders on
18 August 2011, bringing the total cash returned to shareholders
since 31 January 2009 to GBP45.4 million
-- Holders of shares worth GBP213 in January 2009 have since
received GBP270 in cash and now hold shares worth GBP56
-- Loss before tax: GBP0.64 million (31 July 2010: profit GBP2.38 million)
-- Triple net asset value per share: 587p (31 January 2011:
639p; 31 July 2010: 629p (restated for the 2 for 3 share capital
consolidation on 20 January 2011))
-- Pro forma NNNAPS, adjusting for the August 2011 return of
cash to shareholders and share capital consolidation, was 667p per
share
-- Cash available to the Group, after setting aside the GBP4.6
million returned to shareholders on 18 August 2011 and security
deposits required for Court approval of GBP2.1 million, was GBP2.1
million.
David Tye, Chairman, commented:
"In the present economic climate there are few grounds to expect
the value of our residual directly-owned property portfolio to
increase over the next few years as a result of general market
forces. Accordingly, we are actively continuing our sales programme
with the timing of disposals being driven by the circumstances of
each individual property. This is particularly linked to lettings,
rent reviews and other asset management initiatives with the
achievement of planning consent at Chilton Trinity as a major
goal.
"A number of property disposals are planned for the second half
of the financial year and further returns of cash to shareholders
will be announced when economically viable amounts have been
realised."
For further information:-
Rugby Estates www.rugbyestates.plc.uk Tel: 020 7016
David Tye, Chairman 0050
Andrew Wilson, Chief Executive
Fairfax I.S. PLC Tel: 020 7598
Katy Birkin / Simon Bennet / Laura 5368
Littley
FTI Consulting Tel: 020 7831
Stephanie Highett / Dido Laurimore 3113
/
Will Henderson
CHAIRMAN'S REVIEW
Financial Performance
The results for the six months ended 31 July 2011 reflect the
strategic decision of the Company to dispose of its properties and
return proceeds to shareholders, which resulted in a reduction in
rental income and a decrease in fee income following the takeover
of Rugby Estates Investment Trust PLC ("REIT PLC") in 2010.
In the six months ended 31 July 2011 the Group recorded a loss
of GBP0.64 million (31 July 2010: profit GBP2.38 million). There
was no tax charge (31 July 2010: credit GBP0.02 million). Net
revenue items, comprising rental income, fee income and finance
income less administrative expenses, resulted in a net loss of
GBP0.1 million (31 July 2010: profit GBP1.19 million). The directly
owned property portfolio recorded a loss of GBP0.68 million (31
July 2010: loss GBP1.41 million), comprising a profit from the sale
of the property at Staines of GBP1.17 million with realised and
unrealised valuation changes for the other properties amounting to
GBP1.85 million. The contribution of co-investment vehicles to
profit was GBP0.13 million (31 July 2010: GBP2.6 million). Total
comprehensive expense for the period, which takes into account
certain gains and losses on co-investment vehicles, was GBP0.9
million (31 July 2010: income GBP1.03 million).
We continue to realise the value of the directly-owned property
portfolio with individual assets being sold when key lease and
asset management events have been completed. We have been working
for a considerable time to achieve planning consent for residential
development at our industrial site at Chilton Trinity, Somerset and
to redevelop our former tool hire depot in Surbiton, Surrey as a
convenience supermarket. Achieving these consents will increase the
expected realisation proceeds of these properties. In October, we
were delighted to achieve consent for the Surbiton property
following appeal and a sale of this property to a leading
supermarket operator is now in solicitors' hands. The Chilton
Trinity planning application continues to suffer from the
administrative delays endemic in the UK's planning system but we
are now expecting a decision by the end of the year.
Following the property sales during the period and receipt of
cash from ING Covent Garden Limited Partnership ("CGLP"), the Board
announced, on 30 June 2011, proposals to return 125p per share in
cash to shareholders. Following approval by shareholders at a
General Meeting and by the Court, cash payments totalling GBP4.6
million were made to shareholders on 18 August 2011. This brings
the total cash returned to shareholders since 31 January 2009 to
GBP45.4 million. The holder of one hundred ordinary shares at 31
January 2009, when the market value was GBP213, has since received
GBP270 in cash and now holds 14 new ordinary shares with a market
value as at 25 October 2011 of GBP56, representing an increase in
shareholder value of 53% since January 2009.
Triple net asset value per share ("NNNAPS") at 31 July 2011,
calculated on a going concern basis consistent with previous
periods, was 587p (31 January 2011: 639p; 31 July 2010: 629p
(restated for the 2 for 3 share capital consolidation on 20 January
2011)). Pro forma NNNAPS, calculated by adjusting triple net assets
of GBP21.6 million at 31 July 2011 for the subsequent return of
cash of GBP4.6 million and the associated 9 for 13 share capital
consolidation, was 667p per share. The calculation of NNNAPS is set
out in note 10 below.
NNNAPS is calculated and reported as a key performance indicator
to enable shareholders to assess changes in underlying net assets
at estimated market value. This is based on the statement of
financial position which is prepared on a going concern basis.
Accordingly, NNNAPS does not represent the amount that shareholders
would receive on a liquidation of the Company as no allowance is
made for such costs as asset disposal fees, termination of
employment and other contracts, liquidators' fees and
administration expenses during any winding up period.
Rugby Capital
Rugby Capital is the division of the Group that deals with our
directly-owned property portfolio. The Group's strategy continues
to be to manage the portfolio to maximise net rental income and
capital receipts through disposals.
During the period, property disposals realised GBP3.8 million.
The properties sold were:
-- Staines, Moor Lane
-- London E15, Romford Road, Stratford
-- Harlow, Printers Way (part disposal - one unit remaining)
Following these transactions and a review of valuations, the
Directors' estimate of the market value of the Group's residual
directly-owned portfolio as at 31 July 2011 was GBP14.1 million (31
January 2011: GBP19.6 million; 31 July 2010: GBP20.7 million). Sale
proceeds realised in the half year of GBP3.8 million added to the
portfolio value as at 31 July 2011 of GBP14.1 million show an 8.7%
reduction from the portfolio valuation of GBP19.6 million as at 31
January 2011. This reflects the secondary nature of the portfolio
and the expectation that the portfolio realisation will be
substantially completed during 2012.
At 31 July 2011, 66% of the rental value of the Group's
directly-owned portfolio was in offices, with 21% in the industrial
sector and 13% in retail. London and South-East England accounted
for 43% of the portfolio by capital value, with 35% in the
Midlands, and 22% in the South West. Contracted annual rental
income as at 31 July 2011 was GBP1.3 million and the estimated
rental value for the portfolio, if fully let, was GBP1.5 million.
Since 31 July 2011, lease expiries, principally at Edgbaston, have
reduced contracted annual rental income to GBP0.9 million.
Rugby Asset Management ("RAM")
Rugby Asset Management is the division of the Group that deals
with our co-investment and asset management activities.
Fee income for the period was GBP0.7 million (31 July 2010:
GBP1.5 million). The prior period included GBP1.1 million (of which
GBP0.6 million was a termination fee) in respect of REIT Plc, which
was acquired by ING Real Estate Income Trust in May 2010.
RAM continues to act as Property Adviser to O Twelve Estates
Limited and ING Covent Garden Limited Partnership, both vehicles in
which the Group is also a co-investor.
RAM actively continues to pursue new asset management
initiatives. Attention over the past year has principally focused
on two opportunities in the hotel sector. However, a fund to
develop budget hotels on the basis of a pre-let to specific major
budget hotel operators is no longer progressing. We are actively
working with an experienced operator of three star hotels in London
to establish a fund to acquire a critical mass of such hotels.
O Twelve Estates Limited ("O Twelve")
O Twelve was launched in 2006 as an AIM quoted investment fund
focused on real estate opportunities to the east of London where
the 2012 Olympic Games is the catalyst for major regeneration and
infrastructure initiatives. We were delighted that O Twelve was
able to complete a Placing and Open Offer in January 2011 which
raised GBP35 million (net of expenses) of new equity in cash. This
has enabled O Twelve to restructure its debt, reduce gearing and
replenish working capital. The fundamental rationale for the
creation of O Twelve continues to be supported by the positive
activity in its target area.
RAM currently receives an asset management fee of 0.6% of O
Twelve's Gross Asset Value under a contractual arrangement which is
subject to review by O Twelve at 31 March 2012. Fee income from O
Twelve for the half year under review was GBP0.5 million (31 July
2010: GBP0.4 million).
In addition to RAM's role as Property Adviser to O Twelve, the
Group holds 7,894,502 ordinary shares in O Twelve representing a
1.64% equity interest.
At 31 March 2011, the latest date for which O Twelve has
announced results, its portfolio comprised 20 properties valued at
GBP158.5 million and its net asset value per share was 8.34p. At 31
July 2011, O Twelve's share price was 5.88p and the carrying value
in the financial position statement of our interest was GBP0.5
million. The difference between share price and estimated
underlying net assets is not considered to be material for the
purposes of calculating the Group's NNNAPS.
ING Covent Garden Limited Partnership ("CGLP")
RAM has been Property Adviser to CGLP since its creation in
March 2002, and the Group holds a 6.46% interest.
During the period, CGLP completed the disposal of virtually the
whole of its property portfolio and returned cash to investors,
with the Group receiving cash distributions of GBP2.0 million. The
Group's share of CGLP's estimated net assets as at 31 July 2011 was
GBP0.2 million, which is the same as the carrying value in the
statement of financial position.
RAM's role as Property Adviser to CGLP is now limited to matters
associated with its winding up and any future fee income will not
be material.
Financing
At 31 July 2011, Group cash balances amounted to GBP8.8 million
and the Group had no borrowings.
After setting aside the GBP4.6 million returned to shareholders
on 18 August 2011 and security deposits required for Court approval
of GBP2.1 million, cash available to the Group was GBP2.1
million.
Principal Risks and Uncertainties
The risks and uncertainties facing the Group for the remaining
six months of the financial year are:
-- prospects for growth in the UK economy continue to be weak
and the effect of government spending policies increases the risk
of economic stagnation and of tenant default, falls in rental
values and more difficult letting conditions. This would adversely
affect the rental income from and the capital value of the Group's
directly-owned properties. This in turn would reduce the amount of
cash available to be returned to shareholders, or delay the
realisation period for the portfolio;
-- increases in investment yields which would adversely affect
the value of the Group's portfolio;
-- lack of liquidity and limited investor interest, in
particular as a result of the very limited availability of debt
financing for purchasers of secondary property, may result in
realisation proceeds achievable during the intended realisation
period being less than previous valuations;
-- co-investment vehicles with bank borrowings may breach loan
covenants or have difficulty in arranging additional or alternative
financing. This in turn would adversely affect the value of the
Group's holdings in those vehicles and future management fee
income;
-- lack of investor appetite for managed property funds, the
Group's limited ability to co-invest and competition for mandates
from other asset management firms may make growth of the Group's
asset management business difficult to achieve. Existing
appointments may be terminated and competitive pressures on
management fees may inhibit the profitability of the asset
management business.
Prospects
In the present economic climate there are few grounds to expect
the value of our residual directly-owned property portfolio to
increase over the next few years as a result of general market
forces. Accordingly, we are actively continuing our sales programme
with the timing of disposals being driven by the circumstances of
each individual property. This is particularly linked to lettings,
rent reviews and other asset management initiatives with the
achievement of planning consent at Chilton Trinity as a major goal.
On the assumption that there are no further major shocks to the
wider economy or the financial system, the Directors currently
expect the disposal of the directly-owned property portfolio to
have been substantially completed during 2012. Given the limited
market activity and the intention to complete the portfolio
realisation over the next year, shareholders should be aware that
actual property realisations may not achieve current estimates of
value and that whilst upsides arising from planning consents, if
achieved, may offset shortfalls on other properties, the overall
effect on returns of cash to shareholders cannot be predicted with
accuracy.
The cost base of the Group remains under continuous review and
we continue to expend considerable effort, in a difficult market,
into generating new asset management business for RAM.
A number of property disposals are planned for the second half
of the financial year and further returns of cash to shareholders
will be announced when economically viable amounts have been
realised.
David Tye
Chairman
28 October 2011
GROUP STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 31 July 2011
31 July 31 July 31 January
2011 2010 2011
Notes Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Sales of properties 3,817 15,812 18,148
Rental income 787 1,394 2,368
Fees receivable 722 1,511 2,586
Revenue 5,326 18,717 23,102
Direct costs of:
Sales of properties (2,558) (16,216) (18,391)
Net realisable value adjustment
to inventory (1,938) (996) (311)
Rental income (210) (154) (367)
Fees receivable (4) (10) (17)
Direct costs (4,710) (17,376) (19,086)
Administrative expenses (1,410) (1,577) (4,816)
Share of post-tax results of
associates - - 11
Gains and losses on financial
assets:
- distributions received 1,951 798 1,277
- unrealised impairment losses (1,813) - (2)
- gains previously recognised
in other comprehensive income - 1,797 1,797
Finance costs - - (2)
Finance revenue 12 21 160
(Loss) / profit before taxation (644) 2,380 2,441
Income tax credit / (charge) - 18 (63)
(Loss) / profit for the period
attributable to equity holders
of the parent (644) 2,398 2,378
Other comprehensive income
Fair value (losses) and gains
on financial assets (256) 432 (69)
Gains realised on disposal - (1,797) (1,797)
Other comprehensive (expense)/income
for the period (net of tax) (256) (1,365) (1,866)
Total comprehensive (expense)/income
for the period attributable to
equity holders of the parent (900) 1,033 512
Basic and diluted (loss)/earnings
per share (July 2010: restated) 4 (25.1)p 67.6p 67.0p
GROUP STATEMENT OF FINANCIAL POSITION
as at 31 July 2011
31 July 2011 31 July 31 January
2010 2011
Notes Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Non-current assets
Investment in associates 5 - 2 -
Financial assets 5 648 3,094 2,717
Total co-investments 5 648 3,096 2,717
Property, plant and equipment 234 288 259
Total non-current assets 882 3,384 2,976
Current assets
Property inventories 13,759 19,044 18,018
Trade and other receivables 1,698 1,036 942
Current tax assets 15 1,560 26
Cash and short term deposits 8,807 26,817 4,894
Total current assets 24,279 48,457 23,880
Total assets 25,161 51,841 26,856
Current liabilities
Trade and other payables 2,804 2,137 3,649
Current tax liabilities - - -
Total current liabilities 2,804 2,137 3,649
Non-current liabilities
Deferred taxation 10 12 10
Total non-current liabilities 10 12 10
Total liabilities 2,814 2,149 3,659
Net assets 22,347 49,692 23,197
Equity
Called up share capital 6 441 1,721 428
Own shares - held for AESOP (155) (210) (121)
Share premium account 8,189 19,848 8,189
Capital redemption reserve 4,402 4,402 4,402
Unrealised gains and losses 3 760 259
Retained earnings 9,467 22,688 9,384
LTIP reserve - 483 656
Total equity 8 22,347 49,692 23,197
GROUP STATEMENT OF CASH FLOWS
for the six months ended 31 July 2011
6 months 6 months Year to
to to
31 July 31 July 31 January
2011 2010 2011
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
Cash flows from operating activities
before changes in working capital 9 (659) 3 (307)
Decrease in property inventories 4,259 16,801 17,827
(Increase) / decrease in receivables (757) 1,090 1,180
(Decrease) / increase in payables (845) (637) 875
Cash generated from operations 1,998 17,257 19,575
Finance costs - - (2)
Finance revenue 13 14 157
Tax received / (paid) 11 (3) 1,448
Cash flows from operating activities 2,022 17,268 21,178
Cash flows from investing activities
Dividends received from associates - - 13
Proceeds from sale of financial
assets - 3,144 3,144
Distributions received from financial
assets 1,951 798 1,277
Purchase of interests in financial
assets - - (126)
Purchase of property, plant and
equipment (3) (3) (4)
Cash flows from investing activities 1,948 3,939 4,304
Cash flows from financing activities
LTIP grant vested - (324) (324)
Shares issued 13 120 120
Purchase of own shares by AESOP (70) (96) (58)
Return of cash to shareholders 3 - - (26,236)
Cash flows from financing activities (57) (300) (26,498)
Net increase / (decrease) in cash
and cash equivalents 3,913 20,907 (1,016)
Cash and cash equivalents at start
of period 4,894 5,910 5,910
Cash and cash equivalents at end
of period 8,807 26,817 4,894
GROUP STATEMENT OF CHANGES IN EQUITY
for the six months ended 31 July 2011
6 Months 6 Months Year to
to to 31 July 31 January
31 July 2010 2011
2011
Notes Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Opening shareholders' equity 8 23,197 48,750 48,750
Total comprehensive (expense)/income
for the period (900) 1,033 512
Shares issued in period 13 120 120
Cash payments to shareholders 3 - - (26,236)
Purchase of own shares - for
AESOP (70) (96) (58)
Share based payment charge
- AESOP 36 36 87
Share based payment charge
- LTIP 71 173 346
LTIP grants vested - (324) (324)
Closing total equity 8 22,347 49,692 23,197
NOTES TO THE INTERIM FINANCIAL STATEMENTS
1. Accounting Policies
The interim financial information for the period ended 31 July
2011 has neither been audited nor reviewed pursuant to guidance
issued by the Auditing Practices Board and does not constitute full
statutory accounts for that period. The statutory accounts for the
year ended 31 January 2011, which were prepared in accordance with
International Financial Reporting Standards as endorsed by the
European Union ("IFRS") and with those parts of the Companies Act
2006 applicable to companies reporting under IFRS, have been
delivered to the Registrar of Companies. The auditors' opinion on
those accounts was unqualified, did not include any references to
any matters to which the auditors drew attention without qualifying
their report, and did not contain a statement made under section
498(2) or section498(3) of the Companies Act 2006.
The financial information in this report comprises the Group
statement of financial position as at 31 July 2011, 31 January 2011
and 31 July 2010 and related statements of Group comprehensive
income, cash flow and changes in equity and related notes for the
periods then ended ("financial information"). The financial
information has been prepared in accordance with the Group's
principal accounting policies as set out in the Annual Report for
the period ending 31 January 2011.
The endorsed IFRS that will be effective (or available for early
adoption) in the financial statements for the year ending 31
January 2012 are still subject to change and to additional
interpretation and therefore cannot be determined with certainty.
Accordingly, the accounting policies for the period will only be
determined finally when the consolidated financial statements are
prepared for the year ending 31 January 2012.
The preparation of financial statements requires management to
make judgements, assumptions and estimates that affect the
application of accounting policies and amounts reported in the
statements of comprehensive income and financial position. Such
decisions are made at the time the financial statements are
prepared and adopted based upon the best information available at
the time. Actual outcomes may be different from initial estimates
and are reflected in the financial statements as soon as they
become apparent.
The measurement of fair value of available for sale financial
assets and assessment of the net realisable value of property
inventories constitute the principal areas of judgement exercised
by the Board in the preparation of these financial statements. The
underlying market valuations of property inventories and investment
properties held by available for sale financial assets are carried
out by directors and by external advisors whom the Board considers
to be suitably qualified to carry out such valuations.
2. Segmental Analysis
The Group reports internally on two principal business segments.
Rugby Capital deals with the Group's property trading and
development activities including the Group's directly-owned
portfolio and collaborative ventures substantially involving the
Group's equity. Rugby Asset Management deals with the Group's
co-investment and asset management activities. The Group does not
operate outside the United Kingdom.
Rugby Rugby Asset Unallocated
Capital Management items 2011
Period ended 31 July 2011 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Comprehensive
Income
Sale of properties 3,817 - - 3,817
Rental income 787 - - 787
Fees receivable - 722 - 722
--------------------------------------- --------- ------------ ------------ --------
Revenue 4,604 722 - 5,326
--------------------------------------- --------- ------------ ------------ --------
Profit on sales of properties 1,259 - - 1,259
Net realisable value adjustment
to inventory (1,938) - - (1,938)
Net rental income 577 - - 577
Net fees receivable - 718 - 718
Administrative expenses - - (1,410) (1,410)
Gains and losses on financial assets - 138 - 138
Finance revenue - - 12 12
(Loss) / profit before taxation (102) 856 (1,398) (644)
Rugby Rugby Asset Unallocated
Capital Management items 2011
Period ended 31 July 2011 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Financial Position
Financial assets - 648 - 648
Property, plant and equipment - - 234 234
Property inventories 13,759 - - 13,759
Receivables - current 968 383 347 1,698
Current tax assets - - 15 15
Cash and short term deposits - - 8,807 8,807
Current liabilities (1,440) (19) (1,345) (2,804)
Non-current liabilities - - (10) (10)
Net assets 13,287 1,012 8,048 22,347
Other Segment information
Additions to property, plant and
equipment 3 3
Depreciation 28 28
All non-current assets are UK based.
41% of Revenue was generated from one customer in respect of the
sale of one property
Rugby Rugby Asset Unallocated
Capital Management items 2010
Period ended 31 July 2010 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Comprehensive
Income
Sale of properties 15,812 - - 15,812
Rental income 1,394 - - 1,394
Fees receivable - 1,511 - 1,511
--------------------------------------- --------- ------------ ------------ --------
Revenue 17,206 1,511 - 18,717
--------------------------------------- --------- ------------ ------------ --------
(Loss) on sales of properties (404) - - (404)
Net realisable value adjustment
to inventory (996) - - (996)
Net rental income 1,240 - - 1,240
Net fees receivable - 1,501 - 1,501
Administrative expenses - - (1,577) (1,577)
Gains and losses on financial assets - 2,595 - 2,595
Finance revenue - 6 15 21
Profit / (loss) before taxation (160) 4,102 (1,562) 2,380
Rugby Rugby Asset Unallocated
Capital Management items 2010
Period ended 31 July 2010 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Financial Position
Investments in associates - 2 - 2
Financial assets - 3,094 - 3,094
Property, plant and equipment - - 288 288
Property inventories 19,044 - - 19,044
Receivables - current 452 293 291 1,036
Current tax assets - - 1,560 1,560
Cash and short term deposits - - 26,817 26,817
Current liabilities (1,690) (15) (432) (2,137)
Non-current liabilities - - (12) (12)
Net assets 17,806 3,374 28,512 49,692
Other Segment information
Additions to property, plant and
equipment 3 3
Depreciation 30 30
All non-current assets are UK based.
38% of Revenue was generated from one customer in respect of the
sale of one property
Rugby Rugby Asset Unallocated
Capital Management items 2011
Year ended 31 January 2011 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Comprehensive
Income
Sale of properties 18,148 - - 18,148
Rental income 2,368 - - 2,368
Fees receivable - 2,586 - 2,586
--------------------------------------- --------- ------------ ------------ --------
Revenue 20,516 2,586 - 23,102
--------------------------------------- --------- ------------ ------------ --------
(Loss) on sales of properties (243) - - (243)
Net realisable value adjustment
to inventory (311) - - (311)
Net rental income 2,001 - - 2,001
Net fees receivable - 2,569 - 2,569
Administrative expenses - - (4,816) (4,816)
Share of results of associate - 11 - 11
Gains and losses on financial assets - 3,072 - 3,072
Finance costs - - (2) (2)
Finance revenue - - 160 160
Profit / (loss) before taxation 1,447 5,652 (4,658) 2,441
Rugby Rugby Asset Unallocated
Capital Management items 2011
Year ended 31 January 2011 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------------------- --------- ------------ ------------ --------
Group Statement of Financial Position
Financial assets - 2,717 - 2,717
Property, plant and equipment - - 259 259
Property inventories 18,018 - - 18,018
Receivables - current 667 138 137 942
Current tax assets - - 26 26
Cash and short term deposits - - 4,894 4,894
Current liabilities (1,522) (21) (2,106) (3,649)
Non-current liabilities - - (10) (10)
Net assets 17,163 2,834 3,200 23,197
Other Segment information
Additions to property, plant and
equipment 4 4
Depreciation 59 59
All non-current assets are UK based.
31% of Revenue was generated from one customer in respect of the
sale of one property
3. Cash payments to Shareholders
Payment date Per share Amount absorbed
(pence) GBP000
Paid
6 months to 31 July - - -
2011
6 months to 31 July - - -
2010
Year ended 31 January 2 September
2011 2010 175p 20,079
31 January
2011 115p 6,157
26,236
4. (Loss)/earnings per share
The calculation of basic (loss)/earnings per share is based on
the loss for the period of GBP644,000 (31 July 2010: profit
GBP2,398,000; 31 January 2011: profit GBP2,378,000) and 3,585,500
ordinary shares (31July 2010: 3,545,600 (restated); 31 January
2011: 3,550,630), the weighted average number of shares in issue
during the period. There are no dilutive shares in issue at the end
of the period and therefore no diluted earnings per share.
5. Co-investments
The Group's co-investments represent investments in undertakings
for which the Group is also the principal property adviser. The
Group has investments in, and is property adviser to, ING Covent
Garden Limited Partnership and O Twelve Estates Limited. The
Group's interest in Rugby Estates Investment Trust Plc was sold on
14 May 2010. London Industrial Partnership Limited was dissolved on
6 April 2011.
31 July 31 July 31 January
2011 2010 2011
GBP000 GBP000 GBP000
Unaudited Unaudited Audited
Investment in associates
London Industrial Partnership Limited
(11.76% interest)
At 31 January 2011 - 2 2
Share of results - - 11
Dividend received - - (13)
At 31 July 2011 - 2 -
Financial assets
ING Covent Garden Limited Partnership
(6.46% interest)
At 31 January 2011 1,997 2,768 2,768
Impairment charge (1,813) (410) (771)
At 31 July 2011 184 2,358 1,997
O Twelve Estates Limited (1.64% interest)
At 31 January 2011 720 518 518
Acquisition of ordinary shares - - 126
Fair value adjustment - 218 76
Impairment charge (256) - -
At 31 July 2011 464 736 720
Rugby Estates Investment Trust Plc
(8.47% interest)
At 31 January 2011 - 2,520 2,520
Sale proceeds - (3,144) (3,144)
Gain realised on disposal - 624 624
At 31 July 2011 - - -
Total financial assets at 31 July
2011 648 3,094 2,717
Total co-investments 648 3,096 2,717
========== ========== ===========
The Group's investments in ING Covent Garden Limited Partnership
and O Twelve Estates Limited are classified as "available-for-sale
financial assets" in accordance with IAS 39.
During the period the Group received cash distributions of
GBP1,951,000 (31 July 2010: GBP798,000; 31 January 2011:
GBP1,277,000) from ING Covent Garden Limited Partnership which have
been credited to the Income Statement.
6. Issued share capital
Ordinary Shares of 15p 31 July 2011 31 July 31 January
2010 2011
Unaudited Unaudited Audited
(restated)
No. No. No.
Number of ordinary shares
in issue
At 31 January 2011 (shares
of 12p) 3,569,558 11,424,993 11,424,993
Issued in period 111,938 48,582 48,584
Share capital consolidation
* 18 August 2010 (into shares of 15p) - - (6,119,240)
* 20 January 2011 (into shares of 12p) - - (1,784,779)
At 31 July 2011 (shares of
12p) 3,681,496 11,473,575 3,569,558
Shares held by AESOP*
* Unawarded (4,367) (19,855) (1,719)
* Conditionally awarded but not yet earned by employees (27,821) (36,549) (15,630)
Number of ordinary shares
for calculating basic earnings
per share and net assets
per share
at period end 3,649,308 11,417,171 3,552,209
(restated) - (3,552,008) -
weighted average during the
period 3,585,482 11,396,574 3,550,630
(restated) - (3,545,600) -
*AESOP - the Group's All Employee Share Ownership Plan.
On 27 May 2011, 111,933 ordinary shares were issued at par to
satisfy vestings under the Company's Long Term Incentive Plan
("LTIP"). On 30 July 2011, five ordinary shares were issued for
410p each in cash.
The number of ordinary shares in issue at 31 July 2010 has been
restated for the 7 for 15 share capital consolidation on 18 August
2010 and for the 2 for 3 share capital consolidation on 20 January
2011.
As a result of the 9 for 13 share capital consolidation on 3
August 2011, the number of ordinary shares in issue at 28 October
2011 is 2,548,728.
7. Reduction of Capital and return of cash to Shareholders
On 30 June 2011 the Company published a circular to shareholders
convening a General Meeting to enable a return of cash to
shareholders of 125p per share. The necessary resolutions were
passed at the General Meeting on 18 July 2011. As part of this
process, application was made to the Court for a reduction of
capital and this was confirmed by the Court on 3 August 2011.
In connection with this the following actions took place with
respect to the Company's share capital:
On 30 July 2011, five ordinary shares were issued for 410p each
in cash, thus increasing the number of Ordinary Shares of 12p in
issue to 3,681,496 in order to facilitate the share capital
consolidation.
On 3 August 2011:
i. the 3,681,496 Ordinary Shares of 12p each were subdivided
into 3,681,496 Ordinary Shares of 9p, 1,717,140 B shares of 3p each
and 1,964,356 C shares of 3p each. Shareholders had elected whether
to take B shares or C shares;
ii. the B shares were redeemed by the Company for 125p per
share, to be paid to shareholders on 18 August 2011, and
cancelled;
iii. a dividend was declared of 125p per C share, to be paid to
shareholders on 18 August 2011, and the C shares were cancelled;
and
iv. the 3,681,496 Ordinary Shares of 9p were consolidated on a
nine for thirteen basis into 2,548,728 Ordinary Shares of 13p
each.
On 18 August 2011 the cash payments, absorbing GBP4,601,870, in
respect of the B share redemptions and the C share dividends were
made to shareholders.
At 31 July 2011, the return of cash remained conditional on
Court approval. Accordingly, the return of cash and the changes to
share capital and reserves set out above, together with future
payments of up to GBP230,093.50 under the Property Realisation
Incentive Plan as a result of the return of cash, are not reflected
in the interim financial statements for the period ending 31 July
2011. 8. Changes in equity
Own shares
Total
Share Capital Unrealised held held Shareholders'
Share premium redemption Retained gains and LTIP for for Equity
capital account reserve earnings losses reserve treasury AESOP Unaudited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 February
2011 428 8,189 4,402 9,384 259 656 - (121) 23,197
Total
comprehensive
income - - - (644) (256) - - - (900)
Issue of shares 13 - - - - - - - 13
LTIP grants
vested - - - 727 - (727) - - -
LTIP charged
to
income
statement - - - - - 71 - - 71
AESOP shares
purchased - - - - - - - (70) (70)
AESOP shares
charged to
income
statement - - - - - - - 36 36
At 31 July
2011 441 8,189 4,402 9,467 3 - - (155) 22,347
Own shares
Total
Share Capital Unrealised held held Shareholders'
Share premium redemption Retained gains LTIP for for Equity
capital account reserve Earnings and losses reserve treasury AESOP Audited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 February
2010 1,714 19,735 4,402 19,600 2,125 1,324 - (150) 48,750
-
Total
comprehensive
income - - - 2,378 (1,866) - - - 512
LTIP grants
vested - - - 690 - (1,014) - - (324)
LTIP charged
to
income
statement - - - - - 346 - - 346
AESOP shares
purchased - - - - - - - (58) (58)
AESOP shares
charged to
income
statement - - - - - - - 87 87
Issue of shares 7 113 - - - - - - 120
Reduction of
capital (1,293) - - 1,293 - - - - -
Reduction of
share premium - (11,659) - 11,659 - - - - -
Return of cash
2 September
2010 - - - (20,079) - - - - (20,079)
Return of cash
31 January
2011 - - - (6,157) - - - - (6,157)
At 31 January
2011 428 8,189 4,402 9,384 259 656 - (121) 23,197
Own shares
Total
Share Capital Unrealised held held Shareholders'
Share premium redemption Retained gains and LTIP for for Equity
capital account reserve earnings losses reserve treasury AESOP Unaudited
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 February
2010 1,714 19,735 4,402 19,600 2,125 1,324 - (150) 48,750
Total
comprehensive
income - - - 2,398 (1,365) - - - 1,033
Issue of shares 7 113 - - - - - - 120
LTIP grants
vested - - - 690 - (1,014) - - (324)
LTIP charged
to
income
statement - - - - - 173 - - 173
AESOP shares
purchased - - - - - - - (96) (96)
AESOP shares
charged to
income
statement - - - - - - - 36 36
At 31 July
2010 1,721 19,848 4,402 22,688 760 483 - (210) 49,692
9. Notes to the Statement of Cash Flows
Reconciliation of cash flows 6 months
from operating activities to 6 months Year ended
to
31 July 2011 31 July 31 January
2010 2011
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
(Loss) / profit before taxation (644) 2,380 2,441
Gains realised on financial
assets - (1,797) (1,797)
Finance costs - - 2
Finance revenue (12) (21) (160)
Income from investments (1,951) (798) (1,277)
Share of results of Associate - - (11)
Share based payment charge
- LTIP 71 173 346
Share based payment charge
- AESOP 36 36 87
Depreciation 28 30 59
Unrealised impairment losses
on financial assets 1,813 - 2
Loss on disposal of property,
plant and equipment - - 1
Cash flows from operating activities
before changes in working capital (659) 3 (307)
10. Additional information for shareholders
Net assets per share 31 July 31 July 31 January
2011 2010 2011
GBPm GBPm GBPm
Unaudited Unaudited Unaudited
(restated)
Net assets per statement of
financial position 22.3 49.7 23.2
Market value of property inventories 14.1 20.7 19.6
Less: book value of property
inventories (13.8) (19.0) (18.0)
Tax payable if property inventories
are sold at market value - (0.5) (0.4)
LTIP obligation - (0.5) (0.7)
PRIP obligation if property
inventories and co-investments
are realised (ii) (1.0) (2.5) (1.0)
Share of underlying net assets
of co-investments (iii) 0.6 3.1 2.7
Less: co-investments per statement
of financial position (0.6) (3.1) (2.7)
Triple net assets ("NNNAPS") 21.6 47.9 22.7
Number of ordinary shares (iv) 3,681,496 7,611,447 3,552,209
Triple net assets per share
- undiluted 587p 629p 639p
(i) Triple net assets per share is calculated and reported as a
key performance indicator to enable shareholders to assess changes
in underlying net assets at estimated market value. This is based
on the statement of financial position which is prepared on a going
concern basis. Accordingly, triple net assets per share does not
represent the amount that shareholders would receive on a
liquidation of the Company as no allowance is made for such costs
as asset disposal fees, termination of employment and other
contracts, liquidators' fees and administration expenses during any
winding up period.
(ii) At the General Meeting held on 15 June 2009 shareholders
approved two executive incentive schemes. Under the Property
Realisation Incentive Plan ("PRIP") the executive directors will
receive up to 5% of distributions to shareholders arising from the
realisation of the Group's property portfolio and capital returns
from co-investments between 1 February 2009 and 31 January 2014. If
the Group's properties were sold at market value and co-investments
were realised at share of estimated net assets as at 31 July 2011,
and the proceeds distributed to shareholders, the further cost to
the Group would be approximately GBP1.0 million. Under the Value
Creation Plan ("VCP"), employees may receive benefits if certain
performance targets relating to the value of the asset management
business are achieved by 31 January 2014. This has no measurable
effect on triple net assets as at 31 July 2011
(iii) The directors do not consider there to be a material
difference between the Group's share of the estimated underlying
net assets of the co-investments at 31 July 2011and their carrying
value.
(iv) The number of ordinary shares and triple net assets per
share as at 31 July 2010 have been restated to allow for the
effects of the 2 for 3 share consolidation on 31 January 2011.
Pro forma net assets per share following the return of cash and
share capital consolidation after 31 July 2011 as set out in note 7
above are calculated as follows:
GBPm
Triple net assets as at 31 July 2011 21.6
Cash returned to shareholders (4.6)
Pro forma triple net assets 17.0
Number of shares as at 31 July 2011 (note 6) 3,681,496
Number of shares adjusted for 9 for 13 consolidation 2,548,728
Pro forma triple net assets per share 667p
Copies of the interim report will be posted to all shareholders
and will be available upon request from the Company at 4 Farm
Street, London W1J 5RD shortly. The interim report,when available,
may also be viewed on the Company's website
www.rugbyestates.plc.uk.
Telephone: 020 7016 0050
Fax: 020 7016 0080
Email: assets@rugbyestates.plc.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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