TIDMTHG
RNS Number : 8592N
Terrace Hill Group PLC
25 February 2009
Within Terrace Hill Group PLC's final results announcement released today at
07:00 under RNS No 8345N, the date for payment of the final dividend should read
7 April 2009.
The remainder of announcement text is unchanged and is
reproduced in full below.
25 February 2009
Terrace Hill Group plc
("Terrace Hill", the "Company" or the "Group")
PRELIMINARY RESULTS FOR THE YEAR ENDING 31 OCTOBER 2008
Terrace Hill Group plc (AIM: THG), a leading UK property development and
investment group, today announces its preliminary results for the year to 31
October 2008.
Financial highlights
* Triple Net Asset Value per share of 53.4p (31 October 2007: 83.7p)
* Adjusted Diluted Net Asset Value per share of 58.0p (31 October 2007: 96.3p)
* GBP108.2 million of debt refinanced since October 2007
* Adjusted pre-tax profit (before property provisions) GBP1.0 million (31 October
2007: GBP4.7 million)
* Pre-tax loss of GBP31.6 million (31 October 2007: profit GBP18.1 million)
* Balance sheet loan to value gearing of 45.7%
* Final dividend of 0.54 pence per share, bringing the total dividend for the year
to 1.34 pence per share, demonstrating the Board's confidence in the Company's
financial strength and long term prospects
* Sale of Queens Wharf, Hammersmith completed for GBP30.75 million realising a
profit of GBP11.1 million.
Operational highlights
* Completed or contracted sales of GBP72.4 million
* Contracted lettings with annual rent roll of GBP5.7 million
* Gained detailed planning consent for 882,155 sq ft
* Pre-let a 92,333 sq ft superstore in Bishop Auckland to Sainsbury's and
contracted to sell a five-acre site to them in Helston
* Planning applications submitted at four Scottish housebuilding sites for a total
of 519 units.
Commenting, Robert Adair, Chairman of Terrace Hill, said:
"Despite the unprecedented economic difficulties and consequent rapid decline of
property values, we have made good operational progress and been successful in
managing and ameliorating the impact of these conditions. Our focus on risk
management, tight control of capital and overhead expenditure, coupled with our
drive towards long-term value creation, means that we are confident that we can
weather the current turbulence and ultimately take advantage of the
opportunities that will arise. In line with the rest of the sector, our
financial results are, of course, greatly affected by the general economic
situation. As a result, we have seen a fall in trading margins and volumes,
increased funding costs and falls in triple net asset value as a result of asset
value writedowns.
"Clearly the immediate future for our industry looks challenging and I
anticipate further falls in asset values. Within our business, however, we have
a range of abilities and expertise and, importantly, the experience of managing
the business through previous downturns. Our goal has always been to produce
superior relative returns for our shareholders through our undoubted skills and
management of risk, and I am confident that we are well positioned to outperform
our peers over the medium-term."
For further information:
Terrace Hill Group plc Tel: +44 (0)20 7631 1666
Robert Adair, Chairman
Philip Leech, Chief Executive
Jon Austen, Group Finance Director
Oriel Securities (Nominated Adviser)Tel: +44 (0)20 7710 7600
Richard Crawley
Daniel Conti
Financial Dynamics Tel: +44 (0)20 7831 3113
Stephanie Highett/Richard Sunderland
Jamie Robertson/Rachel Drysdale
terracehill@fd.com
CHAIRMAN'S STATEMENT
I am pleased to report our financial results for the year ended 31 October 2008.
Despite the unprecedented economic difficulties and consequent rapid decline of
property values, we have made good operational progress and been successful in
managing and ameliorating the impact of these conditions. Our focus on risk
management, tight control of capital and overhead expenditure, coupled with our
drive towards long-term value creation, means that we can weather the current
turbulence and ultimately take advantage of the opportunities that will arise.
In line with the rest of the sector, our financial results are, of course,
greatly affected by the general economic situation. As a result, we have seen a
fall in trading margins and volumes, increased funding costs and falls in triple
net asset value (TNAV) as a result of asset value writedowns.
During the year our adjusted diluted NAV (ADNAV, as defined by EPRA) has
decreased by 39.8% to 58.0 pence per share (31 October 2007: 96.3 pence per
share) and our TNAV has fallen by 36.2% to 53.4 pence per share (31 October
2007: 83.7 pence per share). Adding back the dividend payments made during the
year the underlying TNAV has decreased by 35.1%. The TNAV takes account of any
valuation uplifts above book costs of assets held as trading stock, as well as
contingent tax on prospective gains and adjustments for financial instruments.
In line with our dividend policy, the board is recommending a final dividend of
0.54 pence per share to be paid on 7 April 2009. This proposed final dividend is
lower than last year's final dividend of 1.3 pence per share. We have adjusted
the dividend in line with the movement in TNAV. Taken with the interim dividend
of 0.8 pence per share paid in August, the total dividend in respect of the year
to 31 October 2008 will be 1.34 pence per share. Our commitment to pay a final
dividend is a demonstration of the confidence the board has in our financial
strength and the Group's future.
The Group's loss before tax for the year amounted to GBP31.6 million, which is
stated after accounting for changes in the value of our investment properties
and reductions in the value of our trading stock. Excluding these, our operating
profit before tax for the year was GBP1.0 million, compared with GBP4.7 million
for the year ended 31 October 2007. The financial review contains further
analyses of our performance in the period and a reconciliation of these amounts.
We have successfully dealt with all re-financings that fell due during the
period and since the year end, totalling GBP84.8 million in respect of
on-balance sheet loans and GBP23.4 million in respect of off-balance sheet
loans. Our strong bank relationships have been essential in achieving this
outcome. Most of these re-financings have been characterised by somewhat
harsher terms, reflecting the lack of competition in the banking market. In
2009, we will have more re-financings to complete and our initial discussions
with our lenders give us confidence that these will be completed satisfactorily,
a position borne out by our successes to date. None of our existing loans is in
default.
Our focus is on our cash flow and preserving our cash resources. We constantly
review our cost base and believe we have a lean operation. We have reduced our
headcount by 7.1% since the year end and continue to exercise tight control over
our discretionary expenditure.
Commercial property
We have continued to make good operational progress with a number of lettings.
These include Biogen at Quantum in Maidenhead, Eon at 129 Wilton Road in
Victoria, Hertel at Hudson Quay in Middlehaven, further lettings at Kean House
in Covent Garden and a substantial pre-letting to Sainsbury's in Bishop
Auckland.
We have also sold and forward sold a number of assets, including Queens Wharf in
Hammersmith, a site to Sainsbury's in Helston, Cornwall, an office building to
the Open University in Gateshead and the sale of smaller units to occupiers in
Bristol, Farnborough and Eastbourne.
Residential property
Our residential investment properties have fallen in value by 8.9% in the year,
largely out-performing the wider residential market where the Halifax HPI fell
by 14.6% over the same period. We are particularly pleased with occupancy
levels, now at 91.8%, and with rental levels which have very little delinquency.
Rents have grown by approximately 4.0% per annum over the two years to June 2008
and remained stable since then.
Our strategy, however, remains to sell residential units profitably, although
the dearth of mortgages has made this difficult recently. In the meantime, we
are managing the portfolios efficiently and have effected a reduction in
operating costs equivalent to GBP2.9 million per annum.
We remain confident that our residential investment portfolios will produce good
returns over the medium-term driven by: the low relative value of each unit
(GBP138,000); the geographic diversity avoiding cluster risk; and the pent up
demand for homes.
Clansman Homes, our Scottish housebuilding business, is consolidating its
position with the sites it owns. We now control a land-bank with capacity to
develop in excess of 1,300 units and have very little unsold stock, with those
units that are built seeing signs of renewed interest. We continue to pursue
planning consents where needed and, as mortgage availability improves, we will
continue to make sales. In the longer-term, Clansman Homes offers a real
opportunity to add to shareholder value through an ultimate demerger or trade
sale.
Board
I am very happy to welcome Jon Austen to the Group as our new Group Finance
Director. Jon brings a wealth of experience to us and his knowledge of property
fund management and structuring will be invaluable. I am also pleased to report
that Tom Walsh, his predecessor, has agreed to stay on as Deputy Finance
Director. I am grateful to all the directors and staff for their hard work and
dedication over the last year.
Outlook
Clearly the immediate future for our industry looks challenging and I anticipate
further falls in asset values. Within our business, however, we have a range of
abilities and expertise and, importantly, the experience of managing the
business through previous downturns. We continue to add value through active
management of our assets. Our continued focus on risk management and banking
relationships makes us confident that we can survive the current difficulties
and, ultimately, build on the opportunities presented by this market. Our goal
has always been to produce superior relative returns for our shareholders
through our undoubted skills and management of risk, and I am confident that we
are well positioned to outperform our peers over the medium-term.
Robert FM Adair
Chairman
24 February 2009
REVIEW OF OPERATIONS
Commercial property
The main focus during the course of the year has been intensively managing
existing assets and sites to maximise revenue. This has been achieved by letting
vacant space, exploiting pre-letting opportunities, releasing capital through
sales and adding value through gaining planning consents.
The majority of our current developments have been carried out in financial
joint ventures in which we hold minority equity stakes and all of which have
been financed with limited recourse to the Group. Our financial exposure to
these developments is, therefore, restricted to our original equity stake and to
limited interest overrun guarantees. Where a development has been carried out in
phases and part sold, the receipts have generally been used to reduce initial
borrowings and project gearing. Properties that have been let or part-let, but
not yet sold, provide an income which is used to help service the debt.
It is our usual practice with bare sites to own the whole of the equity until we
have added value through planning and mitigated risk through pre-lets or fixed
price building contracts, following which we sell down the majority of the
equity to a joint venture partner. We recognise that in the current market we
are unlikely to develop these sites without substantial pre-lets or forward
sales. Further capital expenditure is therefore limited, however, we are still
committed to adding additional value through the planning process.
Some of our operational highlights during the year and since the year end are
set out below:
+----+-------------------------------------------------------------------------------------+
| - | since 31 October 2007 we have completed or contracted sales of GBP72.4 million and |
| | have contracted lettings with an annual rent roll of GBP5.7 million; |
+----+-------------------------------------------------------------------------------------+
| - | letting of 53,584 sq ft of new offices at Quantum 2, Vanwall Business Park, |
| | Maidenhead to Biogen Idec on a 15 year lease at an initial rent of GBP1.6 million |
| | per annum; |
+----+-------------------------------------------------------------------------------------+
| - | pre-letting to Sainsbury's, conditional upon planning, of a 92,333 sq ft food |
| | superstore at the Group's retail park at Bishop Auckland, County Durham. Detailed |
| | planning has now been granted by the local authority pending a final decision by |
| | the Government Office; |
+----+-------------------------------------------------------------------------------------+
| - | Eon leased 19,857 sq ft at 129 Wilton Road, Victoria on an average rent of GBP70.85 |
| | per sq ft. In the same building, we let the ground floor retail unit to |
| | Prêt-a-Manger for GBP100,000 per annum. The sale of the private and affordable |
| | residential units was also completed for GBP14.5 million; |
+----+-------------------------------------------------------------------------------------+
| - | Hertel leased 15,000 sq ft in Hudson Quay at Middlehaven on Teesside making the |
| | building fully let. The remainder is let to the Crown Prosecution Service; |
+----+-------------------------------------------------------------------------------------+
| - | at Kean House in Covent Garden we have let all but one floor of the office |
| | accommodation, at rents up to GBP60.00 per sq ft; |
+----+-------------------------------------------------------------------------------------+
| - | within the Terrace Hill Development Partnership we sold three more units at |
| | Aeropark, Farnborough, let or sold three units at Brabazon Office Park, Bristol and |
| | sold seven units at Brampton Road, Eastbourne; |
+----+-------------------------------------------------------------------------------------+
| - | the completion of the sale of a 19,500 sq ft office building to the Open University |
| | at Baltic Business Quarter; |
+----+-------------------------------------------------------------------------------------+
| - | we completed the sale of Queens Wharf in Hammersmith for GBP30.75 million, |
| | realising a profit of GBP11.1 million; and |
+----+-------------------------------------------------------------------------------------+
| - | detailed planning consent has been granted for a 55,750 sq ft food store at Helston |
| | in Cornwall, which is contracted for sale to Sainsbury's. |
+----+-------------------------------------------------------------------------------------+
We have also added significant value to a number of our sites by gaining new
consents, or improving upon existing planning consents, at Southampton,
Middlesbrough, Croydon, Bristol and, most recently, at Howick Place in Victoria,
London for offices and residential.
In total, we have achieved detailed planning consent for 882,155 sq ft of new
space since 31 October 2007.
Residential investment portfolios
At the year end, our residential investment portfolio under management totalled
1,957 units valued at GBP271 million. Out of this total, 1,714 units are within
Terrace Hill Residential PLC in which we have a 49.0% stake.
The value of the portfolios has fallen by 8.9% since last year. Compared to the
average fall in residential values across the UK, as measured by the Halifax HPI
of 14.6%, our properties have performed well.
Across the whole portfolio, occupancy levels have fallen slightly. At 31 October
2008 occupancy was 91.8% compared to 93.0% at the previous year end. This fall
reflects our refurbishment programme where properties are vacant whilst building
works are carried out. Demand for the units remains strong.
Rental growth is now largely static, as a consequence of an increased supply of
properties to let. The rents from our properties remain very affordable and
offer better value than much of the competition. As ever, we aim to maintain a
careful balance between rental levels and occupancy rates.
As expected during the current economic climate, sales activity has been slow
compared with previous years but we achieved the sale of some individual
properties totalling GBP1.1 million in aggregate.
During the year we also entered into a new management agreement with Allsop
Residential Investment Management Limited, who are responsible for the letting
and management of the Terrace Hill Residential PLC portfolio. This new agreement
will significantly reduce our letting and management fees by GBP2.9 million per
annum.
Clansman Homes
As a result of the weakness in the housing market, we have significantly scaled
back plans for new builds and have concentrated on selling inventory stock. This
has had some success and has been achieved without large discounts. We have,
however, made limited use of part exchanges to facilitate some sales. Currently
we have 24 completed and unsold units and have seen an encouraging growth in the
number of visitors and enquiries since the beginning of 2009. We continue to
pursue planning consents on our landbank and are confident of obtaining planning
at our sites at Fenwick, Patna, Carluke and Kilmarnock during the course of the
year. This will add 519 new units to the consented landbank. We have also
submitted a planning application for the 65 acre site we own partially in joint
venture, at Armadale, West Lothian which has capacity for 500 residential units,
a food superstore and a neighbourhood centre. Our landbank has the capacity for
in excess of 1,300 units and we will be able to accelerate turnover rapidly once
market conditions improve.
Philip Leech
Chief Executive
24 February 2009
FINANCIAL REVIEW
Financial results and net asset value
The Group's NAV fell by 24.7% in the period to GBP103.0 million (48.6 pence per
share) from GBP136.9 million (64.6 pence per share) at 31 October 2007 and our
adjusted NAV (equivalent to that defined by EPRA) fell by 39.8% to GBP124.2
million (58.0 pence per share) from GBP210.9 million (96.3 pence per share) at
31 October 2007.
The main reasons for the movement of 38.3 pence per share in the adjusted NAV
are as follows:
+----+-------------------------------------------------------------------------------------+
| - | a fall of 14.9 pence per share in the value of our properties as reflected on our |
| | balance sheet; |
+----+-------------------------------------------------------------------------------------+
| - | a fall of 22.0 pence per share in the value of our trading properties as included |
| | in our adjusted NAV; |
+----+-------------------------------------------------------------------------------------+
| - | earnings for the year (before property valuation adjustments) of 2.4 pence per |
| | share; and |
+----+-------------------------------------------------------------------------------------+
| - | dividends paid in the year of 2.1 pence per share. |
+----+-------------------------------------------------------------------------------------+
Our triple net asset value (TNAV) is arrived at by including the effect of tax
estimated to be payable on the profits arising if all the Group's properties
were to be sold at the values used for adjusted NAV. We also write off all
goodwill carried in the balance sheet and reverse any fair value adjustments of
our financial instruments in arriving at our TNAV figures. The TNAV at 31
October 2008 fell by 36.2% to GBP114.3 million (53.4 pence per share) from the
2007 figure of GBP183.3 million (83.7 pence per share).
Calculation of ADNAV and TNAV (unaudited)
+--------------------------------+---+---+------+---+----------+------+----+------+---+----------+------+----+
| | | 31 October 2008 | | | 31 October 2007 | |
+--------------------------------+--------------+---------------------+----+------+---------------------+----+
| | | Number | | | Number | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| | | of | Pence | | of | Pence per |
| | | shares | per | | shares | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| | GBP'000 | 000s | share | GBP'000 | 000s | share |
| | | | | | | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Audited net asset value | 103,047 | 211,971 | 48.6 | 136,879 | 211,971 | 64.6 |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Revaluation of property held as | 20,324 | | | 68,560 | | |
| current assets | | | | | | |
+------------------------------------+--------------+----------+-----------+----------+----------+-----------+
| Shares to be issued under the | 41 | 2,038 | | 140 | 6,965 | |
| LTIP | | | | | | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Deferred taxation in respect of | 781 | | | 5,301 | | |
| investment properties | | | | | | |
+----------------------------------------+----------+----------+-----------+----------+----------+-----------+
| Adjusted diluted net asset | 124,193 | 214,009 | 58.0 | 210,880 | 218,936 | 96.3 |
| value | | | | | | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Decrease % | | | (39.8)% | | | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Estimated taxation on revaluation of | (6,472) | | | (23,953) | | |
| current assets, unrealized gains and | | | | | | |
| availability of tax losses | | | | | | |
+----------------------------------------+----------+----------+-----------+----------+----------+-----------+
| Goodwill | (3,456) | | | (3,589) | | |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Triple net asset value | 114,265 | 214,009 | 53.4 | 183,338 | 218,936 | 83.7 |
+--------------------------------+------------------+----------+-----------+----------+----------+-----------+
| Decrease % | | | (36.2)% | | | |
+--------------------------------+---+---+------+---+----------+------+----+------+---+----------+------+----+
Income statement
Our income statement for 2008 contains adjustments in respect of our development
properties which were not a feature of our 2007 results. The table set out below
derives a figure for adjusted profit which strips out these adjustments and
other items.
+-----------------------------------------------------------+---------------+---------------+
| Adjusted profit | | |
+-----------------------------------------------------------+---------------+---------------+
| | October 2008 | October 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBPm | GBPm |
+-----------------------------------------------------------+---------------+---------------+
| Reported (loss)/profit before tax | (31.6) | 18.1 |
+-----------------------------------------------------------+---------------+---------------+
| Write downs in respect of development properties | 12.6 | - |
+-----------------------------------------------------------+---------------+---------------+
| Write downs in respect of loans to joint ventures and | 7.8 | - |
| associated companies | | |
+-----------------------------------------------------------+---------------+---------------+
| Deficits/(gains) from investment properties | 3.8 | (7.1) |
+-----------------------------------------------------------+---------------+---------------+
| Deficits/(gains) from joint ventures and associated | 8.4 | (6.3) |
| companies | | |
+-----------------------------------------------------------+---------------+---------------+
| Adjusted profit before tax | 1.0 | 4.7 |
+-----------------------------------------------------------+---------------+---------------+
Revenue in the period was GBP63.4 million (2007: GBP69.9 million), a decrease of
9.6%. The single most significant transaction in the period was the sale of a
site at Hammersmith for GBP30.8 million. Also included in revenue are sales of
houses at three Clansman Homes sites totalling GBP3.0 million (2007: GBP1.6
million) and the balance of the proceeds from pre-sold developments at
Wokingham, Gateshead and Newcastle. We also completed the sale of the
residential parts of our mixed use development in Victoria, London.
The Group generated GBP4.8 million in rental income (2007: GBP4.2 million), an
increase of 14.3%, while development management fees and other income
contributed GBP2.6 million (2007: GBP2.4 million) an increase of 8.3%.
The Group recorded a gross loss for the period of GBP4.1 million (2007: profit
GBP20.7 million). The principal reason for the loss is the inclusion of GBP12.6
million of write downs in respect of our development properties and GBP7.8
million in respect of provisions against loans to joint ventures and associated
companies. The major contributor to profit in the period, as reported in our
interim results, was the sale of the property at Hammersmith which generated a
profit of GBP11.1 million.
Administrative expenses, which largely reflect the operational overheads of the
Group, were GBP6.2 million compared with GBP9.6 million in 2007, a decrease of
35.4%. The main reason for the decrease is due to a credit of GBP1.0 million in
respect of the Group's share-based payment scheme in 2008 compared with a charge
of GBP1.5 million in 2007. Ignoring this, underlying administrative expenses
have reduced from GBP8.1 million in 2007 to GBP7.2 million in 2008.
Movements in the carrying value of our developments and investment properties
are included in various lines in our income statement, depending on whether the
properties are wholly or partly owned. Unrealised losses arising from the
revaluation of wholly owned trading and investment properties amounted to
GBP16.4 million. This comprises GBP12.6 million in respect of our development
properties and is included in the direct costs line of our income statement (as
noted above) and GBP3.8 million, in respect of our on-balance sheet investment
properties included in the income statement, in the line of the same
description. In addition, included in direct costs is a provision of GBP7.8
million against loans to joint ventures and associates as a consequence of
falling values in the underlying developments. Finally, included in the share of
joint ventures and associated undertakings post tax loss is GBP8.4 million
relating to reductions in the carrying value of those off-balance sheet
development and investment properties.
The operating loss for the period after the recognition of the unrealised losses
referred to above (excluding those relating to the Group's share of joint
ventures and associated undertakings) was GBP14.1 million, a reduction on the
previous year's operating profit of GBP18.6 million, although it should be noted
that the 2007 figure included valuation uplifts of GBP7.1 million in respect of
investment properties.
Finance costs of GBP5.5 million (2007: GBP2.4 million) represents the cost of
our on-balance sheet debt. The figure for 2008 includes GBP2.1 million in
respect of a development funding agreement which will reverse in 2009. Our
weighted average interest rate during the year was 6.1%.
Our investment in joint ventures and associated undertakings generated a loss
for the period of GBP12.4 million (2007: profit GBP0.5 million). This is
primarily due to the results of Terrace Hill Residential PLC, of which our share
is 49.0%. The figure of GBP12.4 million comprises our share of the pre-tax loss
on property revaluations of GBP11.8 million (2007: GBP5.9 million), a related
taxation credit of GBP3.4 million (2007: GBP2.5 million) and a trading loss in
the period GBP3.9 million (2007: GBP5.3 million). Other contributors to the
results from joint ventures and associates are the Castlegate House Partnership
where our share is 30.0% and Achadonn Limited, our land holding joint venture in
Scotland, where our interest is 50.0%.
Balance sheet
The Group's total assets at 31 October 2008 were GBP232.4 million, a decrease of
15.3% on the 2007 amount of GBP274.3 million. The net assets, after deducting
minority interests, were GBP103.0 million (2007: GBP136.9 million), a reduction
of 24.8%.
Financial resources and capital management
The Group's financial resources are principally its cash balances and bank loans
and facilities. Typically, the Group finances its projects with dedicated debt
facilities where an individual project provides the security to the lender,
making the project and debt ring-fenced. This results in a relatively large
number of discrete bank facilities, which are also relatively short-term, thus
reducing risk and maintaining flexibility for the Group. At any one time,
therefore, the Group has a relatively high proportion of its overall debt due
for repayment within one year. The majority of our committed commercial
developments are financed in off-balance sheet associated or joint venture
companies with limited recourse to the Group.
At 31 October 2008 our debt position is summarised in the table below.
+-----------------------------------------------------------+---------------+---------------+
| Summary of debt position | | |
+-----------------------------------------------------------+---------------+---------------+
| | October 2008 | October 2007 |
+-----------------------------------------------------------+---------------+---------------+
| Net debt | GBP85.9m | GBP65.5m |
+-----------------------------------------------------------+---------------+---------------+
| Net gearing | 69.1% | 47.8% |
+-----------------------------------------------------------+---------------+---------------+
| Net debt including share of off-balance sheet debt | GBP231.1m | GBP222.5m |
+-----------------------------------------------------------+---------------+---------------+
| Total net gearing | 186.1% | 105.5% |
+-----------------------------------------------------------+---------------+---------------+
| Loan to value % | 45.7% | 29.6% |
+-----------------------------------------------------------+---------------+---------------+
| Loan to value % including share of off-balance sheet debt | 63.3% | 52.0% |
+-----------------------------------------------------------+---------------+---------------+
The net gearing and loan to value percentages shown above are in relation to our
adjusted NAV. The majority of off-balance sheet debt is of limited recourse to
the Group.
At 31 October 2008, 16.8% of our on-balance sheet debt was subject to hedging
arrangements with an average rate of interest of 5.9%. The percentage of our
on-balance sheet debt subject to hedging arrangements is low, as typically such
debt has short maturities and is used to finance early stage developments where
we have needed to retain flexibility for the repayment of debt. By contrast, the
percentage of our off-balance sheet debt that was subject to hedging
arrangements was 74.8% at 31 October 2008. Our typical strategy with our
off-balance sheet projects is to reduce interest rate risk by a significant
degree.
We continually monitor our bank facilities and constantly update a rolling cash
forecast for 24 months ahead. It is worth noting that the Group has no unfunded
capital commitments in respect of its on-balance sheet development projects and
all commercial development expenditure in respect of off-balance sheet projects
is funded by related bank facilities.
The Group regularly stress tests the portfolio for falls in value and builds
into its cash forecasts varying assumptions concerning margin calls or increased
funding costs as a consequence of loan to value covenants being breached. The
Group believes that it has sufficient resources to continue trading for the
foreseeable future.
Since October 2007, GBP108.2 million of debt (including GBP23.4 million of
off-balance sheet debt) has been successfully re-financed. With regard to our
re-financings, in all cases they have been characterised by higher margins, but
loan to value covenants have largely remained constant. Due to the recent falls
in interest rates, funding costs to the Group have remained broadly level,
notwithstanding the increase in margins on our revised facilities.
The Group has a further GBP47.2 million of on-balance sheet debt requiring
re-financing during 2009 and GBP289.4 million that requires re-financing in
relation to our off-balance sheet projects. Our experience to date and our
discussions with lenders in 2009 indicate a willingness to renew our loans. We
borrow from a wide range of banks with whom we have good and long-established
relationships.
None of our existing loans is in default and our covenants are generally limited
to loan to value covenants. With regards to our off-balance sheet projects, the
Group monitors loan to value ratios and, depending on the recourse to the Group
and the overall status of the project, makes appropriate provisions against its
investments.
Dividends
Dividends paid in the year to 31 October 2008 amounted to 2.1 pence (2007: 1.9
pence) and comprised the final dividend in respect of the year to 31 October
2007 of 1.3 pence per share and an interim dividend of 0.8 pence per share in
respect of the year to 31 October 2008. The board is recommending to
shareholders at the Annual General Meeting on 2 April 2009 a final dividend for
the year to 31 October 2008 of 0.54 pence per share. The final dividend will be
paid on 7 April 2009 to all shareholders on the register at 20 March 2009.
+-----------------------------------------------------------+---------------+---------------+
| Debt expiry profile | | |
+-----------------------------------------------------------+---------------+---------------+
| | On-balance | Off-balance |
+-----------------------------------------------------------+---------------+---------------+
| | sheet | sheet* |
+-----------------------------------------------------------+---------------+---------------+
| | GBPm | GBPm |
+-----------------------------------------------------------+---------------+---------------+
| Bank loans and overdraft repayable in one year | 63.0 | 119.4 |
+-----------------------------------------------------------+---------------+---------------+
| Bank loans repayable after more than one year | 40.9 | 25.9 |
+-----------------------------------------------------------+---------------+---------------+
| Total | 103.9 | 145.3 |
+-----------------------------------------------------------+---------------+---------------+
* group share
+-----------------------------------------------------------+---------------+---------------+
| Summary of loan to value ratios of on-balance sheet | | |
| property | | |
+-----------------------------------------------------------+---------------+---------------+
| | Loan to value | Range of |
| | | |
+-----------------------------------------------------------+---------------+---------------+
| | % | covenants |
+-----------------------------------------------------------+---------------+---------------+
| Commercial property | 53.6% | 50-60% |
+-----------------------------------------------------------+---------------+---------------+
| Residential property | 71.4% | 70-75% |
+-----------------------------------------------------------+---------------+---------------+
| Housebuilding property | 34.3% | 65-75% |
+-----------------------------------------------------------+---------------+---------------+
| All property | 45.7% | |
+-----------------------------------------------------------+---------------+---------------+
Jon Austen
Group Finance Director
24 February 2009
Consolidated income statement
for the year ended 31 October 2008
+--------------------------------------------------------+-------+--------------+-------------+
| | | Year ended | Year ended |
+--------------------------------------------------------+-------+--------------+-------------+
| | | 31 October | 31 October |
+--------------------------------------------------------+-------+--------------+-------------+
| | | 2008 | 2007 |
+--------------------------------------------------------+-------+--------------+-------------+
| | Notes | GBP'000 | GBP'000 |
+--------------------------------------------------------+-------+--------------+-------------+
| Revenue | 2 | 63,366 | 69,849 |
+--------------------------------------------------------+-------+--------------+-------------+
| Direct costs | | (67,438) | (49,142) |
+--------------------------------------------------------+-------+--------------+-------------+
| Gross (loss)/profit | | (4,072) | 20,707 |
+--------------------------------------------------------+-------+--------------+-------------+
| Administrative expenses | | (6,195) | (9,587) |
+--------------------------------------------------------+-------+--------------+-------------+
| (Loss)/profit on disposal of investment properties | | (20) | 404 |
+--------------------------------------------------------+-------+--------------+-------------+
| (Loss)/gain on revaluation of investment properties | | (3,846) | 7,062 |
+--------------------------------------------------------+-------+--------------+-------------+
| Operating (loss)/profit | | (14,133) | 18,586 |
+--------------------------------------------------------+-------+--------------+-------------+
| Finance income | 4 | 467 | 1,447 |
+--------------------------------------------------------+-------+--------------+-------------+
| Finance costs | 4 | (5,488) | (2,400) |
+--------------------------------------------------------+-------+--------------+-------------+
| Share of joint venture and associated undertakings | | (12,448) | 505 |
| post tax (loss)/profit | | | |
+--------------------------------------------------------+-------+--------------+-------------+
| (Loss)/profit before tax | | (31,602) | 18,138 |
+--------------------------------------------------------+-------+--------------+-------------+
| Tax | 6 | 4,327 | (3,577) |
+--------------------------------------------------------+-------+--------------+-------------+
| (Loss)/profit from continuing operations | | (27,275) | 14,561 |
+--------------------------------------------------------+-------+--------------+-------------+
| Attributable to | | | |
+--------------------------------------------------------+-------+--------------+-------------+
| Equity holders of the parent | | (27,253) | 14,527 |
+--------------------------------------------------------+-------+--------------+-------------+
| Minority interest | | (22) | 34 |
+--------------------------------------------------------+-------+--------------+-------------+
| | | (27,275) | 14,561 |
+--------------------------------------------------------+-------+--------------+-------------+
| Basic earnings per share | 8 | (12.90)p | 7.33p |
+--------------------------------------------------------+-------+--------------+-------------+
| Diluted earnings per share | 8 | (12.90)p | 7.09p |
+--------------------------------------------------------+-------+--------------+-------------+
The notes below form part of this financial information
Consolidated statement of changes in equity
for the year ended 31 October 2008
+---------------+----+----+----+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| | | | | Capital | | Unrealised | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| | Share | Share | Own | redemption | Merger | gains | Retained | | Minority | |
| | | | | | | and | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| | capital | premium | Shares | reserve | reserve | losses | earnings | Total | interest | Total |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Balance at | 3,744 | 19,369 | - | 849 | 8,386 | - | 67,930 | 100,278 | 314 | 100,592 |
| 31 October | | | | | | | | | | |
| 2006 | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Profit for the | - | - | - | - | - | - | 14,527 | 14,527 | 34 | 14,561 |
| year | | | | | | | | | | |
+--------------------+---------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Total recognised | - | - | - | - | - | - | 14,527 | 14,527 | 34 | 14,561 |
| income and expense | | | | | | | | | | |
| for the year | | | | | | | | | | |
+-------------------------+----+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Acquisition | - | - | - | - | - | - | - | - | (42) | (42) |
| of minority | | | | | | | | | | |
| interest | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Share-based | - | - | - | - | - | - | 1,494 | 1,494 | - | 1,494 |
| payment | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Interim | - | - | - | - | - | - | (1,696) | (1,696) | - | (1,696) |
| ordinary | | | | | | | | | | |
| dividends | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Final | - | - | - | - | - | - | (2,059) | (2,059) | - | (2,059) |
| ordinary | | | | | | | | | | |
| dividends | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Issue of | 496 | 23,839 | - | - | - | - | - | 24,335 | - | 24,335 |
| share | | | | | | | | | | |
| capital | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Balance at | 4,240 | 43,208 | - | 849 | 8,386 | - | 80,196 | 136,879 | 306 | 137,185 |
| 31 October | | | | | | | | | | |
| 2007 | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Loss for the | - | - | - | - | - | - | (27,253) | (27,253) | (22) | (27,275) |
| year | | | | | | | | | | |
+--------------------+---------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Unrealised | - | - | - | - | - | (498) | - | (498) | - | (498) |
| losses on | | | | | | | | | | |
| available-for-sale | | | | | | | | | | |
| investments | | | | | | | | | | |
+--------------------+---------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Total recognised | - | - | - | - | - | (498) | (27,253) | (27,751) | (22) | (27,773) |
| income and expense | | | | | | | | | | |
| for the year | | | | | | | | | | |
+-------------------------+----+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Acquisition | - | - | - | - | - | - | - | - | (26) | (26) |
| of minority | | | | | | | | | | |
| interest | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Own shares | - | - | (609) | - | - | - | - | (609) | - | (609) |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Share-based | - | - | - | - | - | - | (997) | (997) | - | (997) |
| payment | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Merger | - | - | - | - | (1,298) | - | 1,298 | - | - | - |
| reserve | | | | | | | | | | |
| release | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Interim | - | - | - | - | - | - | (1,684) | (1,684) | - | (1,684) |
| ordinary | | | | | | | | | | |
| dividends | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Final | - | - | - | - | - | - | (2,791) | (2,791) | - | (2,791) |
| ordinary | | | | | | | | | | |
| dividends | | | | | | | | | | |
+---------------+--------------+---------+---------+------------+---------+------------+----------+----------+----------+----------+
| Balance at | 4,240 | 43,208 | (609) | 849 | 7,088 | (498) | 48,769 | 103,047 | 258 | 103,305 |
| 31 October | | | | | | | | | | |
| 2008 | | | | | | | | | | |
+---------------+----+----+----+---------+---------+------------+---------+------------+----------+----------+----------+----------+
Consolidated balance sheet
at 31 October 2008
+----------------------------------------------------+--------+---------------+---------------+
| | | 31 October | 31 October |
+----------------------------------------------------+--------+---------------+---------------+
| | | 2008 | 2007 |
+----------------------------------------------------+--------+---------------+---------------+
| | Notes | GBP'000 | GBP'000 |
+----------------------------------------------------+--------+---------------+---------------+
| Non-current assets | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Investment properties | 10 | 49,160 | 53,887 |
+----------------------------------------------------+--------+---------------+---------------+
| Property, plant and equipment | 9 | 590 | 594 |
+----------------------------------------------------+--------+---------------+---------------+
| Investments in equity accounted associates and | 11 | 7,145 | 18,619 |
| joint ventures | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Available-for-sale investments | 11 | 442 | - |
+----------------------------------------------------+--------+---------------+---------------+
| Other investments | 11 | 109 | 147 |
+----------------------------------------------------+--------+---------------+---------------+
| Intangible assets | | 3,456 | 3,589 |
+----------------------------------------------------+--------+---------------+---------------+
| Deferred tax assets | 17 | 4,327 | 661 |
+----------------------------------------------------+--------+---------------+---------------+
| | | 65,229 | 77,497 |
+----------------------------------------------------+--------+---------------+---------------+
| Current assets | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Property inventories | 12 | 120,488 | 126,950 |
+----------------------------------------------------+--------+---------------+---------------+
| Trade and other receivables | 13 | 28,612 | 42,888 |
+----------------------------------------------------+--------+---------------+---------------+
| Cash and cash equivalents | | 18,022 | 26,958 |
+----------------------------------------------------+--------+---------------+---------------+
| | | 167,122 | 196,796 |
+----------------------------------------------------+--------+---------------+---------------+
| Total assets | | 232,351 | 274,293 |
+----------------------------------------------------+--------+---------------+---------------+
| Non-current liabilities | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Bank loans | 16 | (40,890) | (64,339) |
+----------------------------------------------------+--------+---------------+---------------+
| Other payables | 15 | (3,370) | (7,480) |
+----------------------------------------------------+--------+---------------+---------------+
| Deferred tax liabilities | 17 | (782) | (1,863) |
+----------------------------------------------------+--------+---------------+---------------+
| | | (45,042) | (73,682) |
+----------------------------------------------------+--------+---------------+---------------+
| Current liabilities | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Trade and other payables | 14 | (20,878) | (34,094) |
+----------------------------------------------------+--------+---------------+---------------+
| Current tax liabilities | | (153) | (1,190) |
+----------------------------------------------------+--------+---------------+---------------+
| Bank overdrafts and loans | 16 | (62,973) | (28,142) |
+----------------------------------------------------+--------+---------------+---------------+
| | | (84,004) | (63,426) |
+----------------------------------------------------+--------+---------------+---------------+
| Total liabilities | | (129,046) | (137,108) |
+----------------------------------------------------+--------+---------------+---------------+
| Net assets | | 103,305 | 137,185 |
+----------------------------------------------------+--------+---------------+---------------+
| Equity | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Called up share capital | 19 | 4,240 | 4,240 |
+----------------------------------------------------+--------+---------------+---------------+
| Share premium account | 20 | 43,208 | 43,208 |
+----------------------------------------------------+--------+---------------+---------------+
| Own shares | 20 | (609) | - |
+----------------------------------------------------+--------+---------------+---------------+
| Capital redemption reserve | 20 | 849 | 849 |
+----------------------------------------------------+--------+---------------+---------------+
| Merger reserve | 20 | 7,088 | 8,386 |
+----------------------------------------------------+--------+---------------+---------------+
| Unrealised losses | 20 | (498) | - |
+----------------------------------------------------+--------+---------------+---------------+
| Retained earnings | 20 | 48,769 | 80,196 |
+----------------------------------------------------+--------+---------------+---------------+
| Equity attributable to equity holders of the | | 103,047 | 136,879 |
| parent | | | |
+----------------------------------------------------+--------+---------------+---------------+
| Minority interests | | 258 | 306 |
+----------------------------------------------------+--------+---------------+---------------+
| Total equity | | 103,305 | 137,185 |
+----------------------------------------------------+--------+---------------+---------------+
The financial information was approved and authorised for issue by the board of
directors on 24 February 2009 and was signed on its behalf by:
P A J Leech J M Austen
Director Director
Consolidated cash flow statement
for the year ended 31 October 2008
+-----------------------------------------------------------+---------------+---------------+
| | Year ended | Year ended |
+-----------------------------------------------------------+---------------+---------------+
| | 31 October | 31 October |
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Cash flows from operating activities | | |
+-----------------------------------------------------------+---------------+---------------+
| (Loss)/profit before taxation | (31,602) | 18,138 |
+-----------------------------------------------------------+---------------+---------------+
| Adjustments for: | | |
+-----------------------------------------------------------+---------------+---------------+
| Finance income | (467) | (1,447) |
+-----------------------------------------------------------+---------------+---------------+
| Finance costs | 5,488 | 2,400 |
+-----------------------------------------------------------+---------------+---------------+
| Share of joint venture and associated undertakings post | 12,448 | (505) |
| tax loss/(profit) | | |
+-----------------------------------------------------------+---------------+---------------+
| Depreciation and impairment charge | 20,777 | 598 |
+-----------------------------------------------------------+---------------+---------------+
| Loss/(gain) on revaluation of investment properties | 3,846 | (7,062) |
+-----------------------------------------------------------+---------------+---------------+
| Loss/(profit) on disposal of investment properties | 20 | (404) |
+-----------------------------------------------------------+---------------+---------------+
| Share-based payment (credit)/charge | (997) | 1,494 |
+-----------------------------------------------------------+---------------+---------------+
| Cash flows from operating activities before change in | 9,513 | 13,212 |
| working capital | | |
+-----------------------------------------------------------+---------------+---------------+
| Increase in property inventories | (3,634) | (34,026) |
+-----------------------------------------------------------+---------------+---------------+
| Decrease in trade and other receivables | 6,419 | 5,565 |
+-----------------------------------------------------------+---------------+---------------+
| Decrease in trade and other payables | (22,295) | (6,466) |
+-----------------------------------------------------------+---------------+---------------+
| Cash absorbed by operations | (9,997) | (21,715) |
+-----------------------------------------------------------+---------------+---------------+
| Income from investments | 7 | 41 |
+-----------------------------------------------------------+---------------+---------------+
| Finance costs | (4,087) | (2,745) |
+-----------------------------------------------------------+---------------+---------------+
| Finance income | 1,615 | 1,155 |
+-----------------------------------------------------------+---------------+---------------+
| Tax paid | (1,500) | (3,174) |
+-----------------------------------------------------------+---------------+---------------+
| Net cash flows from operating activities | (13,962) | (26,438) |
+-----------------------------------------------------------+---------------+---------------+
| Investing activities | | |
+-----------------------------------------------------------+---------------+---------------+
| Purchase of investment property | - | (4,491) |
+-----------------------------------------------------------+---------------+---------------+
| Sale of investment property | 1,137 | 15,101 |
+-----------------------------------------------------------+---------------+---------------+
| Purchase of investments | (4,011) | (100) |
+-----------------------------------------------------------+---------------+---------------+
| Sale of investments | 1,982 | 1,207 |
+-----------------------------------------------------------+---------------+---------------+
| Purchase of property, plant and equipment | (236) | (678) |
+-----------------------------------------------------------+---------------+---------------+
| Net cash flows from investing activities | (1,128) | 11,039 |
+-----------------------------------------------------------+---------------+---------------+
| Financing activities | | |
+-----------------------------------------------------------+---------------+---------------+
| Borrowings drawn down | 39,813 | 58,827 |
+-----------------------------------------------------------+---------------+---------------+
| Borrowings repaid | (34,516) | (46,022) |
+-----------------------------------------------------------+---------------+---------------+
| Purchase of own shares | (609) | - |
+-----------------------------------------------------------+---------------+---------------+
| Issue of shares | | |
+-----------------------------------------------------------+---------------+---------------+
| - gross receipts | - | 25,001 |
+-----------------------------------------------------------+---------------+---------------+
| - issue costs | - | (666) |
+-----------------------------------------------------------+---------------+---------------+
| Equity dividends paid | (4,475) | (3,755) |
+-----------------------------------------------------------+---------------+---------------+
| Net cash flows from financing activities | 213 | 33,385 |
+-----------------------------------------------------------+---------------+---------------+
| Net (decrease)/increase in cash and cash equivalents | (14,877) | 17,986 |
+-----------------------------------------------------------+---------------+---------------+
| Cash and cash equivalents at 1 November 2007 | 26,371 | 8,385 |
+-----------------------------------------------------------+---------------+---------------+
| Cash and cash equivalents at 31 October 2008 | 11,494 | 26,371 |
+-----------------------------------------------------------+---------------+---------------+
NOTES TO THE CONSOLIDATED FINANCIAL INFORMATION
for the year ended 31 October 2008
1 Accounting policies
Basis of preparation
This financial information has been prepared in accordance with International
Financial Reporting Standards (IFRSs and IFRIC interpretation) published by the
International Accounting Standards Board (IASB) as adopted by the European Union
("EU adopted IFRSs") and with those parts of the Companies Act 1985 applicable
to companies preparing its financial statements in accordance with IFRSs.
Changes in accounting policies
The accounting policies adopted are consistent with those of the previous
financial year except as follows:
The Group has adopted the following new and amended IFRSs during the year.
Adoption of these revised standards did not have any effect on the financial
performance or position of the Group in the current or prior periods. In certain
cases, they did however give rise to additional disclosures.
IFRS 7 Financial Instruments: Disclosures
IAS 1 Amendment - Presentation of Financial Statements
Going concern
The directors are required to make an assessment of the Group's ability to
continue to trade as a going concern. Because of the difficult market conditions
prevailing, this assessment has been subject to more uncertainties than are
usual. The directors have given this matter due consideration and have concluded
that it is appropriate to prepare the Group financial statements on a going
concern basis. The two main considerations were as follows:
Cash flow - the Group maintains a rolling 24 month cash forecast that takes
account of all known inflows and outflows. The cash flow includes estimates of a
number of key variables including the assumed dates and amounts relating to
property disposals and amounts that may be required to reduce indebtedness as a
consequence of falling property values and re-financing. The cash flow is
regularly stress tested to ensure that the Group can withstand reasonable
changes in circumstances that could adversely affect its cash flow. The key
potential changes that the Group has considered include: possible falls in value
of the portfolio which could result in margin calls or increased funding costs
if future loan to value covenants were breached; possible delays in the timing
and reductions in proceeds from portfolio sales given the current lack of
liquidity in the market; and, possible reductions in anticipated cash flows from
re-financing properties after planning permission has been obtained. After
considering the potential cash flow sensitivities the Group believes that it has
sufficient resources to continue trading for the foreseeable future.
Support of the Group's banks - the Group maintains a regular dialogue with its
lenders and keeps them informed of how the Group is trading. The Group has
re-financed GBP84.8 million of debt since October 2007 (including GBP28.7m since
1 November 2008) and has a further GBP47.2 million of debt and overdraft
facilities due to be re-financed in 2009. Whilst the due dates for renewal of
these facilities have not yet occurred, the Group has opened discussions with
each lender to gauge their appetite for their renewal. In all cases the lenders
concerned have been supportive and have indicated their desire to renew the
facilities subject to mutually acceptable terms being agreed. Further
information is contained in the financial review.
Investment property and inventory
In relation to the investment and development properties, the directors have
relied upon the external valuations and advice provided by professionally
qualified valuers in accordance with the Appraisal and Valuation Standards of
the Royal Institution of Chartered Surveyors.
2 Revenue
+--------------------------------------------------------------+--------------+-------------+
| | Total | Total |
+--------------------------------------------------------------+--------------+-------------+
| | 2008 | 2007 |
+--------------------------------------------------------------+--------------+-------------+
| | GBP'000 | GBP'000 |
+--------------------------------------------------------------+--------------+-------------+
| Sales of development properties | 55,982 | 63,246 |
+--------------------------------------------------------------+--------------+-------------+
| Rents receivable | 4,777 | 4,211 |
+--------------------------------------------------------------+--------------+-------------+
| Fees and other income | 2,607 | 2,392 |
+--------------------------------------------------------------+--------------+-------------+
| | 63,366 | 69,849 |
+--------------------------------------------------------------+--------------+-------------+
3 Segmental information
The Group operates in three principal segments being commercial property
development and investment, residential property investment and housebuilding.
The Group does not operate outside the UK.
+----------------+-----+-----+------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| | | | House | Unallocated | | | | House | Unallocated | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| | Residential | Commercial | building | items | Total | Residential | Commercial | building | items | Total |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| | 2008 | 2008 | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | 2007 |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Income | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| statement | | | | | | | | | | |
+----------------------+------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Revenue | 2,722 | 57,654 | 2,990 | - | 63,366 | 3,496 | 64,719 | 1,634 | - | 69,849 |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Direct | (1,266) | (57,176) | (8,996) | - | (67,438) | (2,009) | (45,726) | (1,407) | - | (49,142) |
| costs | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Gross | 1,456 | 478 | (6,006) | - | (4,072) | 1,487 | 18,993 | 227 | - | 20,707 |
| (loss)/profit | | | | | | | | | | |
+----------------------+------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Administrative | - | - | - | (6,195) | (6,195) | - | - | - | (9,587) | (9,587) |
| expenses | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| (Loss)/profit on | (20) | - | - | - | (20) | 244 | 160 | - | - | 404 |
| disposal of | | | | | | | | | | |
| investment properties | | | | | | | | | | |
+----------------------------+------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| (Loss)/gain | (2,182) | (1,664) | - | - | (3,846) | 1,221 | 5,841 | - | - | 7,062 |
| on | | | | | | | | | | |
| revaluation | | | | | | | | | | |
| of | | | | | | | | | | |
| investment | | | | | | | | | | |
| properties | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Operating | (746) | (1,186) | (6,006) | (6,195) | (14,133) | 2,952 | 24,994 | 227 | (9,587) | 18,586 |
| (loss)/profit | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Net | (1,580) | (3,576) | 115 | 20 | (5,021) | (1,379) | 451 | (25) | - | (953) |
| finance | | | | | | | | | | |
| costs | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Share of results of | - | - | (138) | - | (138) | - | - | (167) | - | (167) |
| joint venture before | | | | | | | | | | |
| tax | | | | | | | | | | |
+----------------------------+------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Share of | (16,200) | 451 | - | - | (15,749) | (1,954) | 88 | - | - | (1,866) |
| results | | | | | | | | | | |
| of | | | | | | | | | | |
| associated | | | | | | | | | | |
| undertakings | | | | | | | | | | |
| before tax | | | | | | | | | | |
+----------------+------------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| Associated | 3,439 | - | - | - | 3,439 | 2,538 | - | - | - | 2,538 |
| undertakings | | | | | | | | | | |
| tax | | | | | | | | | | |
+----------------------+------------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
| (Loss)/profit | (15,087) | (4,311) | (6,029) | (6,175) | (31,602) | 2,157 | 25,533 | 35 | (9,587) | 18,138 |
| before tax | | | | | | | | | | |
+----------------+-----+-----+------+------------+----------+-------------+----------+-------------+------------+----------+-------------+----------+
+-------------+---+---+-------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | | | House | Unallocated | | | | House | Unallocated | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | Residential | Commercial | building | items | Total | Residential | Commercial | building | items | Total |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | 2008 | 2008 | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 | 2007 | 2007 |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Balance | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
| sheet | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Investment | 28,633 | 20,262 | 265 | - | 49,160 | 31,962 | 21,925 | - | - | 53,887 |
| properties | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Property, | - | 34 | 67 | 489 | 590 | 23 | 45 | 22 | 504 | 594 |
| plant and | | | | | | | | | | |
| equipment | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Investments | 3,938 | 2,437 | 770 | - | 7,145 | 16,700 | 2,066 | (147) | - | 18,619 |
| - associates | | | | | | | | | | |
| and joint | | | | | | | | | | |
| ventures | | | | | | | | | | |
+-----------------+-----------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Other | 3 | 449 | - | 99 | 551 | | 147 | - | - | 147 |
| investments | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Goodwill | 975 | 2,481 | - | - | 3,456 | 992 | 2,597 | - | - | 3,589 |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Deferred | - | - | - | 4,327 | 4,327 | - | - | - | 661 | 661 |
| tax | | | | | | | | | | |
| assets | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | 33,549 | 25,663 | 1,102 | 4,915 | 65,229 | 49,677 | 26,780 | (125) | 1,165 | 77,497 |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Property | - | 92,372 | 28,116 | - | 120,488 | - | 105,269 | 21,681 | - | 126,950 |
| inventories | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Trade | 14,554 | 11,278 | 1,903 | 877 | 28,612 | 12,803 | 30,085 | - | - | 42,888 |
| and | | | | | | | | | | |
| other | | | | | | | | | | |
| receivables | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Cash | 102 | 17,024 | 896 | - | 18,022 | 702 | 26,256 | - | - | 26,958 |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | 48,205 | 146,337 | 32,017 | 5,792 | 232,351 | 63,182 | 188,390 | 21,556 | 1,165 | 274,293 |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Borrowings | (20,444) | (72,878) | (10,541) | - | (103,863) | (29,545) | (59,199) | (3,737) | - | (92,481) |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Trade and other | (515) | (18,331) | (4,282) | (1,120) | (24,248) | (1,129) | (38,619) | (681) | (1,145) | (41,574) |
| payables | | | | | | | | | | |
+---------------------+-------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Current | - | - | - | (153) | (153) | - | (1,190) | - | - | (1,190) |
| tax | | | | | | | | | | |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Deferred tax | - | - | - | (782) | (782) | (464) | (1,399) | - | - | (1,863) |
| liabilities | | | | | | | | | | |
+---------------------+-------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| | (20,959) | (91,209) | (14,823) | (2,055) | (129,046) | (31,138) | (100,407) | (4,418) | (1,145) | (137,108) |
+-------------+---------------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
| Net | 27,246 | 55,128 | 17,194 | 3,737 | 103,305 | 32,044 | 87,983 | 17,138 | 20 | 137,185 |
| assets | | | | | | | | | | |
+-------------+---+---+-------+------------+----------+-------------+-----------+-------------+------------+----------+-------------+-----------+
Other segmental information
+----------------------+------------+--------------+----------+------------+--------------+----------+
| | Investment | Developments | Total | Investment | Developments | Total |
+----------------------+------------+--------------+----------+------------+--------------+----------+
| | 2008 | 2008 | 2008 | 2007 | 2007 | 2007 |
+----------------------+------------+--------------+----------+------------+--------------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------------+------------+--------------+----------+------------+--------------+----------+
| Depreciation | 194 | 10 | 204 | 95 | - | 95 |
+----------------------+------------+--------------+----------+------------+--------------+----------+
| Goodwill impairment | 133 | - | 133 | 438 | 14 | 452 |
+----------------------+------------+--------------+----------+------------+--------------+----------+
| Capital expenditure | 235 | - | 235 | 653 | 25 | 678 |
+----------------------+------------+--------------+----------+------------+--------------+----------+
4 Finance costs and finance income
+-------------------------------------------------------------------+------------+----------+
| | 2008 | 2007 |
+-------------------------------------------------------------------+------------+----------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------------------+------------+----------+
| Interest payable on borrowings | 7,558 | 5,025 |
+-------------------------------------------------------------------+------------+----------+
| Interest payable under a development funding agreement | 2,050 | - |
+-------------------------------------------------------------------+------------+----------+
| Interest capitalised | (4,120) | (2,625) |
+-------------------------------------------------------------------+------------+----------+
| Finance costs | 5,488 | 2,400 |
+-------------------------------------------------------------------+------------+----------+
| Interest receivable from cash deposits and other financial assets | 467 | 1,447 |
+-------------------------------------------------------------------+------------+----------+
| Finance income | 467 | 1,447 |
+-------------------------------------------------------------------+------------+----------+
Interest is capitalised at the same rate as the Group is charged on the
respective borrowings. Fair value adjustments to financial liabilities totalled
GBPnil (2007: GBPnil) and gains on interest rate swaps totalled GBPnil (2007:
GBPnil).
5 Administrative expenses
+-------------------------------------------------------------------+------------+----------+
| | 2008 | 2007 |
+-------------------------------------------------------------------+------------+----------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------------------+------------+----------+
| Depreciation of property, plant and equipment | 204 | 95 |
+-------------------------------------------------------------------+------------+----------+
| Loss on disposal of property, plant and equipment | 5 | 6 |
+-------------------------------------------------------------------+------------+----------+
| Operating lease charges - rent of properties | 1,311 | 1,276 |
+-------------------------------------------------------------------+------------+----------+
| Impairment of goodwill | 133 | 452 |
+-------------------------------------------------------------------+------------+----------+
| Share-based payment remuneration | (997) | 1,494 |
+-------------------------------------------------------------------+------------+----------+
| Fees paid to BDO Stoy Hayward LLP in respect of: | | |
+-------------------------------------------------------------------+------------+----------+
| - audit of the company's annual accounts | 125 | 117 |
+-------------------------------------------------------------------+------------+----------+
| - audit of the company's subsidiaries | 50 | 75 |
+-------------------------------------------------------------------+------------+----------+
| - other services | 29 | 19 |
+-------------------------------------------------------------------+------------+----------+
6 Tax on (loss)/profit on ordinary activities
(a) Analysis of charge in year
+-----------------------------------------------------------------+------------+------------+
| | 2008 | 2007 |
+-----------------------------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------+------------+------------+
| Current tax | | |
+-----------------------------------------------------------------+------------+------------+
| UK corporation tax on (loss)/profit for the year | 376 | 3,943 |
+-----------------------------------------------------------------+------------+------------+
| Adjustment in respect of prior periods | 44 | (354) |
+-----------------------------------------------------------------+------------+------------+
| Total current tax | 420 | 3,589 |
+-----------------------------------------------------------------+------------+------------+
| Deferred tax | | |
+-----------------------------------------------------------------+------------+------------+
| Origination and reversal of temporary differences | (4,747) | (12) |
+-----------------------------------------------------------------+------------+------------+
| Total deferred tax credit | (4,747) | (12) |
+-----------------------------------------------------------------+------------+------------+
| Total tax (credit)/expense | (4,327) | 3,577 |
+-----------------------------------------------------------------+------------+------------+
b) Factors affecting the tax (credit)/expense for the year
The tax assessed for the year is lower than the standard rate of corporation tax
in the UK of 28% (2007: 30%). The differences are explained below:
+-----------------------------------------------------------------+------------+------------+
| | 2008 | 2007 |
+-----------------------------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------+------------+------------+
| (Loss)/profit before tax | (31,602) | 18,138 |
+-----------------------------------------------------------------+------------+------------+
| Less joint ventures and associates | 12,448 | (505) |
+-----------------------------------------------------------------+------------+------------+
| (Loss)/profit attributable to the Group before tax | (19,154) | 17,633 |
+-----------------------------------------------------------------+------------+------------+
| (Loss)/profit multiplied by the average rate of UK corporation | (5,522) | 5,290 |
| tax of 28.83% (2007: 30%) | | |
+-----------------------------------------------------------------+------------+------------+
| Disallowables | 376 | 253 |
+-----------------------------------------------------------------+------------+------------+
| Other temporary differences | (397) | (394) |
+-----------------------------------------------------------------+------------+------------+
| Consortium loss relief utilised | - | (2,168) |
+-----------------------------------------------------------------+------------+------------+
| Utilisation of losses | 1,172 | 950 |
+-----------------------------------------------------------------+------------+------------+
| | (4,371) | 3,931 |
+-----------------------------------------------------------------+------------+------------+
| Adjustments in respect of prior periods | 44 | (354) |
+-----------------------------------------------------------------+------------+------------+
| Total tax (credit)/expense | (4,327) | 3,577 |
+-----------------------------------------------------------------+------------+------------+
(c) Associates and joint ventures
The Group's share of tax on the associates is GBP3,439,000 credit (2007:
GBP2,538,000 credit). No tax charge arises on the results of the joint ventures.
7 Dividends
+-----------------------------------------------------------------+------------+------------+
| | 2008 | 2007 |
+-----------------------------------------------------------------+------------+------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------+------------+------------+
| Ordinary shares | | |
+-----------------------------------------------------------------+------------+------------+
| Final dividend of 1.3 pence (2007: final dividend for 2006 of | 2,756 | 2,059 |
| 1.1 pence) per share for the year ended 31 October 2007 | | |
+-----------------------------------------------------------------+------------+------------+
| Interim dividend paid of 0.8 pence (2007: interim dividend for | 1,684 | 1,696 |
| 2007 of 0.8 pence) per share for the year ended 31 October 2008 | | |
+-----------------------------------------------------------------+------------+------------+
| | 4,440 | 3,755 |
+-----------------------------------------------------------------+------------+------------+
| Final dividend after the year of 0.54 pence (2007: 1.3 pence) | 1,139 | 2,756 |
| per share | | |
+-----------------------------------------------------------------+------------+------------+
The proposed final dividend has not been accrued at the balance sheet date.
8 Earnings per ordinary share
The calculation of basic earnings per ordinary share is based on a loss of
GBP27,253,000 (2007 profit: GBP14,527,000) and on 211,187,902 (2007:
198,069,224) ordinary shares, being the weighted average number of shares in
issue during the period.
The calculation of diluted earnings per ordinary share for 2008 is the same as
the calculation of basic earnings per ordinary share. For 2007, the calculation
of diluted earnings per ordinary share is based on a profit of GBP14,527,000 and
on 204,787,224 ordinary shares, being the weighted average number of shares in
issue during the period adjusted to allow for the issue of shares in relation to
all performance related share awards.
9 Property, plant and equipment
+-----------------------------+--------------+------------+------------+------------+------------+
| | Leasehold | Motor | Office | Furniture | |
+-----------------------------+--------------+------------+------------+------------+------------+
| | improvements | vehicles | equipment | and | Total |
| | | | | fittings | |
+-----------------------------+--------------+------------+------------+------------+------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Cost | | | | | |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 1 November 2006 | - | 6 | 82 | 55 | 143 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Additions | 151 | 315 | 78 | 134 | 678 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Disposals | - | (25) | (74) | - | (99) |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 1 November 2007 | 151 | 296 | 86 | 189 | 722 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Additions | 8 | 109 | 32 | 86 | 235 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Disposals | - | (35) | (5) | (14) | (54) |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 31 October 2008 | 159 | 370 | 113 | 261 | 903 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Depreciation | | | | | |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 1 November 2006 | - | 4 | 72 | 31 | 107 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Charge for period | 9 | 39 | 17 | 30 | 95 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Disposals | - | - | (74) | - | (74) |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 1 November 2007 | 9 | 43 | 15 | 61 | 128 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Charge for period | 14 | 84 | 45 | 61 | 204 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Disposals | - | (7) | (5) | (7) | (19) |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 31 October 2008 | 23 | 120 | 55 | 115 | 313 |
+-----------------------------+--------------+------------+------------+------------+------------+
| Net book value: | | | | | |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 31 October 2008 | 136 | 250 | 58 | 146 | 590 |
+-----------------------------+--------------+------------+------------+------------+------------+
| At 31 October 2007 | 142 | 253 | 71 | 128 | 594 |
+-----------------------------+--------------+------------+------------+------------+------------+
At the year end there were no assets held under finance leases. At 31 October
2007, the net book value of assets under finance leases was GBP87,000.
Acquisitions in the year to 31 October 2007 comprised assets acquired by the
Group from Terrace Hill Partnership on its cessation of activities on 31 March
2007.
10 Investment properties
+--------------------------------------------+--------------------------------------------+
| | GBP'000 |
+--------------------------------------------+--------------------------------------------+
| Valuation | |
+--------------------------------------------+--------------------------------------------+
| At 1 November 2006 | 56,967 |
+--------------------------------------------+--------------------------------------------+
| Additions | 4,491 |
+--------------------------------------------+--------------------------------------------+
| Disposals | (14,486) |
+--------------------------------------------+--------------------------------------------+
| Surplus on revaluation | 6,915 |
+--------------------------------------------+--------------------------------------------+
| At 31 October 2007 | 53,887 |
+--------------------------------------------+--------------------------------------------+
| Transfer from inventory | 220 |
+--------------------------------------------+--------------------------------------------+
| Disposals | (1,101) |
+--------------------------------------------+--------------------------------------------+
| Loss on revaluation | (3,846) |
+--------------------------------------------+--------------------------------------------+
| At 31 October 2008 | 49,160 |
+--------------------------------------------+--------------------------------------------+
Included in additions for the year is capitalised interest of GBPnil (2007:
GBP431,000).
The investment properties situated in Scotland owned by the Group have been
valued as at 31 October 2008 by qualified valuers from Allied Surveyors, an
independent firm of Chartered Surveyors, on the basis of open market value. The
valuations were carried out in accordance with guidance issued by the Royal
Institution of Chartered Surveyors.
The commercial investment properties situated in England owned by the Group have
been valued as at 31 October 2008 by qualified valuers from CB Richard Ellis,
and independent form of Chartered Surveyors, on the basis of open market value.
The valuations were carried out and in accordance with guidance issued by the
Royal Institution of Chartered Surveyors.
Residential investment properties situated in England owned by the Group have
been valued at open market value by directors, who are suitably qualified or
experienced, at 31 October 2008 having regard to professional advice and/or
sales evidence during the period. The value of these properties was GBP5,387,000
(2007: GBP7,172,000)
11 Investments
Associates and joint venture
+----------------------------------------------+--------------+---------------+---------------+
| | | Joint | |
+----------------------------------------------+--------------+---------------+---------------+
| | Associates | venture | Total |
+----------------------------------------------+--------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------------------+--------------+---------------+---------------+
| Cost or valuation | | | |
+----------------------------------------------+--------------+---------------+---------------+
| At 1 November 2006 | 18,068 | 20 | 18,088 |
+----------------------------------------------+--------------+---------------+---------------+
| Additions | 26 | - | 26 |
+----------------------------------------------+--------------+---------------+---------------+
| Share of results | 672 | (167) | 505 |
+----------------------------------------------+--------------+---------------+---------------+
| At 31 October 2007 | 18,766 | (147) | 18,619 |
+----------------------------------------------+--------------+---------------+---------------+
| Investment write off | (81) | - | (81) |
+----------------------------------------------+--------------+---------------+---------------+
| Share of results | (12,310) | (138) | (12,448) |
+----------------------------------------------+--------------+---------------+---------------+
| Unrealised profit | - | 1,055 | 1,055 |
+----------------------------------------------+--------------+---------------+---------------+
| At 31 October 2008 | 6,375 | 770 | 7,145 |
+----------------------------------------------+--------------+---------------+---------------+
The Group's interest in its principal associates which have been equity
accounted in the consolidated financial statements were as follows:
+----------------------------------------------+--------------+------------------------------+
| Terrace Hill Residential PLC | 49% | Property investment |
+----------------------------------------------+--------------+------------------------------+
| Castlegate House Partnership | 30% | Property development |
+----------------------------------------------+--------------+------------------------------+
| Devcap 2 Partnership | 26% | Property development |
+----------------------------------------------+--------------+------------------------------+
| Terrace Hill Development Partnership | 20% | Property development |
+----------------------------------------------+--------------+------------------------------+
| Howick Place JV S.a.r.l. | 20% | Investment holding company |
+----------------------------------------------+--------------+------------------------------+
| Two Orchards Limited | 20% | Property development |
+----------------------------------------------+--------------+------------------------------+
Terrace Hill Residential PLC was incorporated in Scotland and Howick Place JV
S.a.r.l. is resident in Luxemburg.
Summarised information 2008
+----------------------+-+--+-+--+------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Terrace | | Castlegate | Terrace | | | | |
| | Hill | | | Hill | | | | |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Development | Devcap 2 | House | Residential | Howick | Two | | |
| | | | | | | | | |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Partnership | Partnership | Partnership | PLC | Place | Orchards | Other | Total |
| | | | | | | | | |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Revenue | 7,012 | 308 | 610 | 12,265 | 1,502 | - | - | 21,697 |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| (Loss)/profit after | (2,119) | (1,793) | 92 | (26,043) | (1,708) | - | - | (31,571) |
| taxation | | | | | | | | |
+-----------------------------+---------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Total assets | 56,285 | 46,367 | 9,398 | 247,724 | 72,278 | 59,805 | - | 491,857 |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Bank debt | (27,604) | (38,962) | (8,558) | (207,502) | (50,523) | (52,273) | - | (385,422) |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Other liabilities | (16,602) | (9,190) | (2,355) | (32,184) | (25,530) | (7,531) | - | (93,392) |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Total liabilities | (44,206) | (48,152) | (10,913) | (239,686) | (76,053) | (59,804) | - | (478,814) |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Net | 12,079 | (1,785) | (1,515) | 8,038 | (3,775) | 1 | - | 13,043 |
| assets/(liabilities) | | | | | | | | |
+----------------------+----------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Share of results for | - | - | 451 | (12,761) | - | - | - | (12,310) |
| period | | | | | | | | |
+--------------------------------+------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Share of net | 2,416 | - | - | 3,938 | 20 | 1 | - | 6,375 |
| assets | | | | | | | | |
+------------------------+--------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Capital commitments | 2,424 | - | - | - | - | 13,485 | - | 15,909 |
+----------------------+-+--+-+--+------+-------------+-------------+-------------+----------+----------+---------+-----------+
Summarised information 2007
+-------------------+--+-+-+--------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Terrace | | Castlegate | Terrace | | | | |
| | Hill | | | Hill | | | | |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Development | Devcap 2 | House | Residential | Howick | Two | | |
| | | | | | | | | |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | Partnership | Partnership | Partnership | PLC | Place | Orchards | Other | Total |
| | | | | | | | | |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Revenue | 31,550 | - | 702 | 14,268 | 1,922 | - | - | 48,442 |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Profit/(loss) | 2,765 | - | (1,550) | 1,192 | (2,167) | - | - | 240 |
| after taxation | | | | | | | | |
+----------------------+------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Total assets | 46,527 | 37,255 | 9,747 | 276,947 | 66,348 | 28,391 | - | 465,215 |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Bank debt | (24,906) | (26,544) | (8,558) | (211,737) | (48,785) | (4,607) | - | (325,137) |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Other | (9,542) | (10,703) | (2,642) | (31,128) | (19,630) | (23,783) | - | (97,478) |
| liabilities | | | | | | | | |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Total | (34,448) | (37,247) | (11,250) | (242,865) | (68,415) | (28,390) | - | (422,615) |
| liabilities | | | | | | | | |
+-------------------+---------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Net | 12,079 | 8 | (1,503) | 34,082 | (2,067) | 1 | - | 42,600 |
| assets/(liabilities) | | | | | | | | |
+----------------------+------------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Share of results | 553 | - | (465) | 584 | - | - | - | 672 |
| for period | | | | | | | | |
+------------------------+----------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Share of net | 2,416 | 2 | (451) | 16,700 | 20 | 1 | 78 | 18,766 |
| assets/(liabilities) | | | | | | | | |
+--------------------------+--------+-------------+-------------+-------------+----------+----------+---------+-----------+
| Capital | 831 | 4,836 | - | - | - | - | - | 5,667 |
| commitments | | | | | | | | |
+-------------------+--+-+-+--------+-------------+-------------+-------------+----------+----------+---------+-----------+
The Group's interest in its joint venture which has been equity accounted in
the consolidated financial statements was as follows:
+------------------------------+------------------------------------------+------------------+
| Achadonn Limited | 50% | Property |
| | | development |
+------------------------------+------------------------------------------+------------------+
Summarised information
+--------------------------------------------------------+----------------+----------------+
| | 2008 | 2007 |
+--------------------------------------------------------+----------------+----------------+
| | Achadonn | Achadonn |
+--------------------------------------------------------+----------------+----------------+
| | Limited | Limited |
+--------------------------------------------------------+----------------+----------------+
| | GBP'000 | GBP'000 |
+--------------------------------------------------------+----------------+----------------+
| Revenue | 2,803 | 39 |
+--------------------------------------------------------+----------------+----------------+
| Profit/(loss) | 1,834 | (334) |
+--------------------------------------------------------+----------------+----------------+
| Total assets | 14,332 | 11,420 |
+--------------------------------------------------------+----------------+----------------+
| Bank debt | (9,436) | (9,536) |
+--------------------------------------------------------+----------------+----------------+
| Other liabilities | (3,356) | (2,178) |
+--------------------------------------------------------+----------------+----------------+
| Total liabilities | (12,792) | (11,714) |
+--------------------------------------------------------+----------------+----------------+
| Net assets/(liabilities) | 1,540 | (294) |
+--------------------------------------------------------+----------------+----------------+
| Share of results for period | 917 | (167) |
+--------------------------------------------------------+----------------+----------------+
| Share of net assets/(liabilities) | 770 | (147) |
+--------------------------------------------------------+----------------+----------------+
Available-for-sale investments and other investments
+----------------------------------------+--------------------+----------------+----------------+
| | Available-for-sale | Other | |
+----------------------------------------+--------------------+----------------+----------------+
| | investments | investments | Total |
+----------------------------------------+--------------------+----------------+----------------+
| | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------------+--------------------+----------------+----------------+
| Valuation | | | |
+----------------------------------------+--------------------+----------------+----------------+
| At 1 November 2006 | - | 1,338 | 1,338 |
+----------------------------------------+--------------------+----------------+----------------+
| Additions | - | 1 | 1 |
+----------------------------------------+--------------------+----------------+----------------+
| Disposals | - | (1,250) | (1,250) |
+----------------------------------------+--------------------+----------------+----------------+
| Increase in fair value | - | 58 | 58 |
+----------------------------------------+--------------------+----------------+----------------+
| At 31 October 2007 | - | 147 | 147 |
+----------------------------------------+--------------------+----------------+----------------+
| Additions | 3,987 | 1 | 3,988 |
+----------------------------------------+--------------------+----------------+----------------+
| Disposals | (3,047) | (15) | (3,062) |
+----------------------------------------+--------------------+----------------+----------------+
| Decrease in fair value | (498) | (24) | (522) |
+----------------------------------------+--------------------+----------------+----------------+
| At 31 October 2008 | 442 | 109 | 551 |
+----------------------------------------+--------------------+----------------+----------------+
+----------------------------------------+----------------+----------------+----------------+
| | | 2008 | 2007 |
+----------------------------------------+----------------+----------------+----------------+
| | | GBP'000 | GBP'000 |
+----------------------------------------+----------------+----------------+----------------+
| UK unlisted investments at fair value | | 45 | 1 |
+----------------------------------------+----------------+----------------+----------------+
| UK listed investments at fair value | | 506 | 146 |
+----------------------------------------+----------------+----------------+----------------+
| | | 551 | 147 |
+----------------------------------------+----------------+----------------+----------------+
12 Property inventories
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| At 1 November 2007 | 126,950 | 75,693 |
+-----------------------------------------------------------+---------------+---------------+
| Additions | 43,301 | 100,399 |
+-----------------------------------------------------------+---------------+---------------+
| Disposals | (36,978) | (49,142) |
+-----------------------------------------------------------+---------------+---------------+
| Transfers to investment properties | (220) | - |
+-----------------------------------------------------------+---------------+---------------+
| Amounts written off the value of inventories | (12,565) | - |
+-----------------------------------------------------------+---------------+---------------+
| At 31 October 2008 | 120,488 | 126,950 |
+-----------------------------------------------------------+---------------+---------------+
| Included in these figures is capitalised interest of | 8,269 | 4,162 |
+-----------------------------------------------------------+---------------+---------------+
13 Trade and other receivables
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Trade receivables | 1,915 | 2,299 |
+-----------------------------------------------------------+---------------+---------------+
| Other receivables | 2,553 | 4,277 |
+-----------------------------------------------------------+---------------+---------------+
| Trade and other receivables | 4,468 | 6,576 |
+-----------------------------------------------------------+---------------+---------------+
| Prepayments and accrued income | 2,247 | 12,261 |
+-----------------------------------------------------------+---------------+---------------+
| Amounts due from associates and joint ventures | 29,673 | 24,051 |
+-----------------------------------------------------------+---------------+---------------+
| Provision for amounts due from associates and joint | (7,776) | - |
| ventures | | |
+-----------------------------------------------------------+---------------+---------------+
| | 28,612 | 42,888 |
+-----------------------------------------------------------+---------------+---------------+
Included in the amount due from associate and joint ventures is a balance due
from Howick Place JV S.a.r.l. of GBP3.4 million that has a final maturity date
of 31 December 2014.
The ageing of trade and other receivables was as follows:
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Up to 30 days | 1,676 | 2,397 |
+-----------------------------------------------------------+---------------+---------------+
| 31 to 60 days | 1,504 | 843 |
+-----------------------------------------------------------+---------------+---------------+
| 61 to 90 days | 107 | 22 |
+-----------------------------------------------------------+---------------+---------------+
| Over 90 days | 451 | 1,251 |
+-----------------------------------------------------------+---------------+---------------+
| Total | 3,738 | 4,513 |
+-----------------------------------------------------------+---------------+---------------+
| Amounts not yet due | 730 | 2,063 |
+-----------------------------------------------------------+---------------+---------------+
| Closing balance | 4,468 | 6,576 |
+-----------------------------------------------------------+---------------+---------------+
No amounts were overdue at the year end.
The movement in the allowance for impairment in respect of amounts due from
associates and joint ventures during the year was as follows:
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| At 1 November 2007 | - | - |
+-----------------------------------------------------------+---------------+---------------+
| Amounts written off in year | - | - |
+-----------------------------------------------------------+---------------+---------------+
| Increase in allowance on amounts due from associates | 7,776 | - |
+-----------------------------------------------------------+---------------+---------------+
| Closing balance | 7,776 | - |
+-----------------------------------------------------------+---------------+---------------+
The allowance is based on falling asset values in the associates.
14 Trade and other payables
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Trade payables | 2,452 | 3,398 |
+-----------------------------------------------------------+---------------+---------------+
| Other taxation and social security costs | 650 | 1,499 |
+-----------------------------------------------------------+---------------+---------------+
| Accruals and deferred income | 8,168 | 27,384 |
+-----------------------------------------------------------+---------------+---------------+
| Other payables | 9,608 | 1,813 |
+-----------------------------------------------------------+---------------+---------------+
| | 20,878 | 34,094 |
+-----------------------------------------------------------+---------------+---------------+
15 Other payables (non-current)
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Other payables | 3,370 | 7,480 |
+-----------------------------------------------------------+---------------+---------------+
16 Bank overdrafts and loans
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Bank loans | 97,680 | 92,410 |
+-----------------------------------------------------------+---------------+---------------+
| Bank overdrafts | 6,528 | 587 |
+-----------------------------------------------------------+---------------+---------------+
| | 104,208 | 92,997 |
+-----------------------------------------------------------+---------------+---------------+
| Unamortised loan issue costs | (345) | (516) |
+-----------------------------------------------------------+---------------+---------------+
| | 103,863 | 92,481 |
+-----------------------------------------------------------+---------------+---------------+
| Amounts due: | | |
+-----------------------------------------------------------+---------------+---------------+
| Within one year | 62,973 | 28,142 |
+-----------------------------------------------------------+---------------+---------------+
| After more than one year | 40,890 | 64,339 |
+-----------------------------------------------------------+---------------+---------------+
| | 103,863 | 92,481 |
+-----------------------------------------------------------+---------------+---------------+
An analysis of interest rates and information on fair value and security is
given in note 18.
17 Deferred tax
Details of the deferred tax (credited)/charged to the Consolidated income
statement are as follows:
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Investment property revaluations | (1,515) | 521 |
+-----------------------------------------------------------+---------------+---------------+
| Trade losses | (3,084) | - |
+-----------------------------------------------------------+---------------+---------------+
| Share-based payments | 279 | (413) |
+-----------------------------------------------------------+---------------+---------------+
| Short-term timing differences | (427) | (120) |
+-----------------------------------------------------------+---------------+---------------+
| | (4,747) | (12) |
+-----------------------------------------------------------+---------------+---------------+
The Consolidated balance sheet deferred tax assets and liabilities are as
follows:
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Deferred tax provision | | |
+-----------------------------------------------------------+---------------+---------------+
| Investment property revaluations | (782) | (1,863) |
+-----------------------------------------------------------+---------------+---------------+
| | (782) | (1,863) |
+-----------------------------------------------------------+---------------+---------------+
| Deferred tax asset | | |
+-----------------------------------------------------------+---------------+---------------+
| Share option scheme | 221 | 501 |
+-----------------------------------------------------------+---------------+---------------+
| Investment property revaluations | 434 | - |
+-----------------------------------------------------------+---------------+---------------+
| Trade losses | 3,084 | - |
+-----------------------------------------------------------+---------------+---------------+
| Other timing differences | 588 | 160 |
+-----------------------------------------------------------+---------------+---------------+
| | 4,327 | 661 |
+-----------------------------------------------------------+---------------+---------------+
Under IAS 12, deferred tax is recognised for tax potentially payable on the
realisation of investment properties at fair values at the balance sheet date.
No deferred tax asset is recognised in respect of losses if there is uncertainty
over future recoverability.
18 Financial instruments
The Group's principal financial instruments comprise loans, overdrafts, cash and
short-term deposits. The main purpose of these financial instruments is to
provide finance for the Group's operations. Further information on the group's
financial resources and capital management is given in the Financial review.
The Group has various other financial instruments such as trade receivables and
trade payables that arise directly from its operations, listed and unlisted
investments.
The main risks arising from the Group's financial instruments are interest rate
risk, credit risk and liquidity risk. The board reviews and agrees policies for
managing each of these risks and they are summarised below. The magnitude of the
risk that has arisen over the period is detailed below.
Interest rate risk
The Group holds cash balances on short-term deposit. The Group's policy is to
monitor the level of these balances to ensure that funds are available as
required, recognising that interest earnings will be subject to interest rate
fluctuations.
The Group borrows cash in the form of loans and overdrafts, which are subject to
interest at floating rates, recognising that rates will fluctuate according to
changes in the bank base rate. The Group is cognisant at all times of movements
in interest rates and will, as appropriate, enter into interest rate swaps to
maintain a balance between borrowings that are subject to floating and fixed
rates.
Credit risk
The Group's principal financial assets are cash and trade receivables. Our cash
deposits are placed with a range of banks to minimise the risk to the Group. The
principal risk therefore arises from trade receivables. Trade receivables from
the sale of properties are secured against those properties until the proceeds
are received. Rental receivables are unsecured but the Group's exposure to
tenant default is limited as no tenant accounts for more than 10% of total rent.
Rental cash deposits and third party guarantees are obtained as a means of
mitigating financial loss from defaults.
Liquidity risk
The Group's objective is to maintain a balance between continuity of funding and
flexibility through the use of bank balances and loans. Cash flow and funding
needs are regularly monitored. Further information is given in note 1.
Categories of financial assets and financial liabilities
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Current financial assets | | |
+-----------------------------------------------------------+---------------+---------------+
| Available-for-sale investments | 442 | - |
+-----------------------------------------------------------+---------------+---------------+
| Other investments | 109 | 147 |
+-----------------------------------------------------------+---------------+---------------+
| Trade and other receivables | 4,468 | 6,576 |
+-----------------------------------------------------------+---------------+---------------+
| Amounts due from associates and joint ventures | 21,879 | 24,051 |
+-----------------------------------------------------------+---------------+---------------+
| Cash and cash equivalent | 18,022 | 26,958 |
+-----------------------------------------------------------+---------------+---------------+
| | 44,920 | 57,732 |
+-----------------------------------------------------------+---------------+---------------+
The maximum exposure to credit risk in financial assets is GBP44,920,000 (2007:
GBP57,732,000). The maximum amount due from any single party is GBP14,403,000
(2007: GBP10,196,000) included in amounts due from associates and joint
ventures.
Financial liabilities measured at amortised cost
+-----------------------------------------------------------+---------------+---------------+
| | 2008 | 2007 |
+-----------------------------------------------------------+---------------+---------------+
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------+---------------+---------------+
| Current financial liabilities | | |
+-----------------------------------------------------------+---------------+---------------+
| Trade and other payables | 20,228 | 32,595 |
+-----------------------------------------------------------+---------------+---------------+
| Loans and borrowings | 63,099 | 28,258 |
+-----------------------------------------------------------+---------------+---------------+
| Total current financial liabilities | 83,327 | 60,853 |
+-----------------------------------------------------------+---------------+---------------+
| Non-current financial liabilities | | |
+-----------------------------------------------------------+---------------+---------------+
| Other payables | 3,370 | 7,480 |
+-----------------------------------------------------------+---------------+---------------+
| Loans and borrowings | 41,109 | 64,739 |
+-----------------------------------------------------------+---------------+---------------+
| Total non-current financial liabilities | 44,479 | 72,219 |
+-----------------------------------------------------------+---------------+---------------+
| Total financial liabilities | 127,806 | 133,072 |
+-----------------------------------------------------------+---------------+---------------+
Interest rate risk profile of financial assets and liabilities
The interest rate profile of financial assets and liabilities of the Group at 31
October 2008 was as follows:
+-----------------------------+---------------+---------------+---------------+---------------+
| | | | | Financial |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | Floating | | assets on |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | rate | Fixed rate | which no |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | financial | financial | interest |
+-----------------------------+---------------+---------------+---------------+---------------+
| | Total | assets | assets | is earned |
+-----------------------------+---------------+---------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+---------------+---------------+---------------+---------------+
| Sterling | 44,920 | 18,022 | 3,480 | 23,418 |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | | | |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | | | Financial |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | Floating | | liabilities |
| | | | | on |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | rate | Fixed rate | which no |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | financial | Financial | interest |
+-----------------------------+---------------+---------------+---------------+---------------+
| | Total | liabilities | Liabilities | is charged |
+-----------------------------+---------------+---------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+---------------+---------------+---------------+---------------+
| Sterling | 127,806 | 104,208 | - | 23,598 |
+-----------------------------+---------------+---------------+---------------+---------------+
Floating rate financial liabilities bear interest at LIBOR or base rate plus
margins of between 1% and 2.5%.
Included in floating rate financial liabilities is GBP17,517,000 (2007: GBPnil)
subject to interest rate swaps entered into on 28 October 2008.
The interest rate profile of financial assets and liabilities of the Group at 31
October 2007 was as follows:
+-----------------------------+---------------+---------------+---------------+---------------+
| | | | | Financial |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | Floating | | assets on |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | rate | Fixed rate | which no |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | financial | financial | interest |
+-----------------------------+---------------+---------------+---------------+---------------+
| | Total | assets | assets | is earned |
+-----------------------------+---------------+---------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+---------------+---------------+---------------+---------------+
| Sterling | 57,732 | 26,958 | 3,480 | 27,294 |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | | | Financial |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | Floating | | liabilities |
| | | | | on |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | rate | Fixed rate | which no |
+-----------------------------+---------------+---------------+---------------+---------------+
| | | financial | financial | interest |
+-----------------------------+---------------+---------------+---------------+---------------+
| | Total | liabilities | liabilities | is charged |
+-----------------------------+---------------+---------------+---------------+---------------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-----------------------------+---------------+---------------+---------------+---------------+
| Sterling | 133,072 | 92,997 | - | 40,075 |
+-----------------------------+---------------+---------------+---------------+---------------+
The floating rate financial assets comprise:
* cash on deposit.
The floating rate financial liabilities comprise:
* sterling denominated bank loans that bear interest based on LIBOR and bank base
rates; and
* sterling denominated bank overdrafts that bear interest based on bank base
rates.
The fair value of the financial assets and liabilities is equal to the book
value.
Borrowings
The Group's bank borrowings and overdrafts are repayable as follows:
+-------------------------------------------------------+------------------+----------------+
| | 2008 | 2007 |
+-------------------------------------------------------+------------------+----------------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------+------------------+----------------+
| On demand or within one year | 63,099 | 28,258 |
+-------------------------------------------------------+------------------+----------------+
| In more than one year but less than two | 8,924 | 51,361 |
+-------------------------------------------------------+------------------+----------------+
| In more than two years but less than five | 32,185 | 13,378 |
+-------------------------------------------------------+------------------+----------------+
| | 104,208 | 92,997 |
+-------------------------------------------------------+------------------+----------------+
The bank overdraft is secured by way of debenture and cross guarantee from
certain subsidiaries.
The bank loans are secured by legal charges over the Group's investment and
development properties together with guarantees from certain subsidiary
undertakings with a limited guarantee from the parent company and in one case a
floating charge from the parent company.
Borrowing facilities
The Group has the following undrawn committed bank borrowing facilities
available to it at the year end:
+-------------------------------------------------------+------------------+----------------+
| | 2008 | 2007 |
+-------------------------------------------------------+------------------+----------------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------+------------------+----------------+
| Expiring in one year or less: | 5,375 | 8,782 |
+-------------------------------------------------------+------------------+----------------+
| Expiring in more than one year but not more than two: | 12,756 | 24,877 |
+-------------------------------------------------------+------------------+----------------+
| Expiring in more than two years but not more than | 8,187 | 4,000 |
| five: | | |
+-------------------------------------------------------+------------------+----------------+
| | 26,318 | 37,659 |
+-------------------------------------------------------+------------------+----------------+
Guarantees
The Group has given a guarantee of GBP15.0 million as part of the security
arrangements for the bank facilities of Terrace Hill Residential PLC, one of its
associated undertakings.
Market rate sensitivity analysis
Financial instruments affected by market risk include borrowings, deposits and
derivative financial instruments. The analysis below shows the sensitivity of
the income statement and net assets to a 0.5% change in interest rates on the
Group's financial instruments.
The sensitivity analysis is based on the sensitivity of interest to movements in
interest rates and is calculated on net floating rate exposure on debt and
deposits.
+-------------------------------------------------------+------------------+----------------+
| | 0.5% decrease | 0.5% increase |
+-------------------------------------------------------+------------------+----------------+
| | in interest | in interest |
| | rates | rates |
+-------------------------------------------------------+------------------+----------------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------+------------------+----------------+
| Impact on interest payable - gain/(loss) | 266 | (266) |
+-------------------------------------------------------+------------------+----------------+
| Impact on interest receivable - (loss)/gain | (144) | 152 |
+-------------------------------------------------------+------------------+----------------+
| Total impact on pre tax (loss)/profit and equity | 122 | (114) |
+-------------------------------------------------------+------------------+----------------+
19 Called up share capital
+-------------------------------------------------------+------------------+----------------+
| | 2008 | 2007 |
+-------------------------------------------------------+------------------+----------------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------+------------------+----------------+
| Authorised: | | |
+-------------------------------------------------------+------------------+----------------+
| 500,000,000 (2007: 500,000,000) ordinary shares of 2 | 10,000 | 10,000 |
| pence each | | |
+-------------------------------------------------------+------------------+----------------+
| 200,000 cumulative 8% redeemable preference shares of | 200 | 200 |
| GBP1 each | | |
+-------------------------------------------------------+------------------+----------------+
| 44,859 convertible shares of 20 pence each | 9 | 9 |
+-------------------------------------------------------+------------------+----------------+
| 32,551,410 deferred shares of 2 pence each | 651 | 651 |
+-------------------------------------------------------+------------------+----------------+
| | 10,860 | 10,860 |
+-------------------------------------------------------+------------------+----------------+
| | | |
+-------------------------------------------------------+------------------+----------------+
| | GBP'000 | GBP'000 |
+-------------------------------------------------------+------------------+----------------+
| Allotted, called up, and fully paid: | | |
+-------------------------------------------------------+------------------+----------------+
| 211,971,299 (2007: 211,971,299) ordinary shares of 2 | 4,240 | 4,240 |
| pence each | | |
+-------------------------------------------------------+------------------+----------------+
20 Reserves
+--------------------------+----------+----------+-------------+----------+------------+----------+
| | | | Capital | | Unrealised | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| | Share | Own | redemption | Merger | gains | Retained |
| | | | | | and | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| | premium | shares | reserve | reserve | losses | earnings |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| At 1 November 2006 | 19,369 | - | 849 | 8,386 | - | 67,930 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Profit for the year | - | - | - | - | - | 14,527 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Share-based payment | - | - | - | - | - | 1,494 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Interim ordinary | - | - | - | - | - | (1,696) |
| dividends | | | | | | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Final ordinary dividends | - | - | - | - | - | (2,059) |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Issue of ordinary share | | | | | | |
| capital | | | | | | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| - gross proceeds | 24,505 | - | - | - | - | - |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| - issue costs | (666) | - | - | - | - | - |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| At 31 October 2007 | 43,208 | - | 849 | 8,386 | - | 80,196 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Loss for the year | - | - | - | - | - | (27,253) |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Unrealised losses on | - | - | - | - | (498) | - |
| available-for-sale | | | | | | |
| investments | | | | | | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Own shares | - | (609) | - | - | - | - |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Share-based payment | - | - | - | - | - | (997) |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Merger reserve release | - | - | - | (1,298) | - | 1,298 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Interim ordinary | - | - | - | - | - | (1,684) |
| dividends | | | | | | |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| Final ordinary dividends | - | - | - | - | - | (2,791) |
+--------------------------+----------+----------+-------------+----------+------------+----------+
| At 31 October 2008 | 43,208 | (609) | 849 | 7,088 | (498) | 48,769 |
+--------------------------+----------+----------+-------------+----------+------------+----------+
The following describes the nature and purpose of each reserve within owners'
equity:
Share premium - represents the excess of value of shares issued over their
nominal amount
Own shares - represents amount paid to purchase issued shares for the employee
share-based payment plan
Capital redemption reserve - represents amount paid to purchase issued shares
for cancellation at their nominal value
Merger reserve - the Merger reserve has arisen following acquisitions where the
Group's equity has formed all or part of the consideration and represents the
premium on the issued shares less costs
Unrealised gains and losses - represents unrealised loss on available-for-sale
investments.
Retained earnings - represents cumulative net gains and losses recognised in the
consolidated income statement
21 Contingent liabilities and capital commitments
On the acquisition by Terrace Hill Group PLC of a subsidiary company, amounts
were repayable in the event of:
+-----+-------------------------------------------------------------------------------------+
| (a) | disposal of the property/ies prior to an agreed cut-off point; or |
+-----+-------------------------------------------------------------------------------------+
| (b) | the discontinuation of rental income from the property/ies. |
+-----+-------------------------------------------------------------------------------------+
The directors are of the opinion that neither of these contingencies will
crystallise, since the principal activity of the subsidiary concerned is the
letting of the properties for rental income and it is not anticipated that the
properties will be disposed of within the timeframe of (a) above. In the event
of crystallisation of (a) and/or (b), the subsidiary concerned will be obligated
to pay an amount calculated with reference to the properties disposed of/not let
out. The maximum sum repayable is GBP381,000 (2007: GBP442,000).
Capital commitments relating to development sites are as follows:
+--------------------------------------------------------------------+----------+----------+
| | 2008 | 2007 |
+--------------------------------------------------------------------+----------+----------+
| | GBP'000 | GBP'000 |
+--------------------------------------------------------------------+----------+----------+
| Contracted but not provided for | - | 13,772 |
+--------------------------------------------------------------------+----------+----------+
22 Leases
Operating lease commitments where the Group is the lessee
The future aggregate minimum lease rentals payable under non-cancellable
operating leases are as follows:
+----------------------------------------------------------+---------------+----------------+
| | Land and | Land and |
+----------------------------------------------------------+---------------+----------------+
| | buildings | buildings |
+----------------------------------------------------------+---------------+----------------+
| | 2008 | 2007 |
+----------------------------------------------------------+---------------+----------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------------------+---------------+----------------+
| In one year or less | 1,373 | 1,373 |
+----------------------------------------------------------+---------------+----------------+
| Between two and five years | 5,490 | 5,492 |
+----------------------------------------------------------+---------------+----------------+
| In five years or more | 6,982 | 8,358 |
+----------------------------------------------------------+---------------+----------------+
| | 13,845 | 15,223 |
+----------------------------------------------------------+---------------+----------------+
Operating lease commitments where the Group is the lessor
The future aggregate minimum rentals receivable under non-cancellable operating
leases are as follows:
+----------------------------------------------------------+---------------+----------------+
| | Land and | Land and |
+----------------------------------------------------------+---------------+----------------+
| | buildings | buildings |
+----------------------------------------------------------+---------------+----------------+
| | 2008 | 2007 |
+----------------------------------------------------------+---------------+----------------+
| | GBP'000 | GBP'000 |
+----------------------------------------------------------+---------------+----------------+
| In one year or less | 1,997 | 1,463 |
+----------------------------------------------------------+---------------+----------------+
| Between two and five years | 7,746 | 5,565 |
+----------------------------------------------------------+---------------+----------------+
| In five years or more | 8,346 | 1,584 |
+----------------------------------------------------------+---------------+----------------+
| | 18,089 | 8,612 |
+----------------------------------------------------------+---------------+----------------+
Statutory information
The financial information set out in this
announcement does not constitute the Group's statutory financial statements for
the year ended 31 October 2008 but is derived from those financial
statements.
The financial information is extracted from the audited
financial statements of the Group for the year ended 31 October 2008 which were
approved by the board of directors on 24 February 2009. The Company's auditors,
BDO Stoy Hayward LLP, have reported on the accounts for the period ended 31
October 2008 under section 235(1) of the Companies Act 1985 ("Act"). Their
report was not qualified within the meaning of section 235(2) of the Act and did
not contain statements made under section 237(2) and section 237(3) of the
Act.
Copies of the full financial statements will be posted to
shareholders as soon as possible and will also be available on the company's
website, www.terracehill.co.uk. The financial statements for the year ended 31
October 2008 will be delivered to the Registrar of Companies following the
Annual General Meeting.
TERRACE HILL'S PORTFOLIO
Office development portfolio
Current schemes
Developments completed or under construction
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Development | Region | Size | Description | Timing | Terrace Hill |
| | | (sq ft) | | | share |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Victoria, SW1 | London | 60,407 | Substantial mixed-use | Completed | 50% |
| 129 Wilton Road | | | development comprising | | |
| | | | 60,407 sq ft of grade A | | |
| | | | office accommodation part | | |
| | | | let to Eon and Prêt à | | |
| | | | Manger. The residential | | |
| | | | elements of the scheme | | |
| | | | have all been sold. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Bracknell | South | 194,210 | Prominent 7.9 acre site | On site | 20% |
| Maxis I & II, | East | | with planning for three | Completes | |
| Western Road | | | buildings. | May 2009 | |
| | | | Phase 1 comprises two | | |
| | | | buildings, totalling | | |
| | | | 194,210 sq ft. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Farnborough | South | 36,300 | Development of 15 small | Completed | 20% |
| Phrase 1 | East | | office units ranging in | | |
| Aeropark Cirrus | | | size from 1,793 - 2,975 | | |
| | | | sq ft. Located adjacent | | |
| | | | to Farnborough Airfield | | |
| | | | and | | |
| | | | Aerospace Business Park. | | |
| | | | Five units sold. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Maidenhead | South | 120,000 | Prime office park | Completed | 26% |
| Quantum 1 & | East | | development of two | | |
| 2 Vanwall Business Park | | | buildings. | | |
| | | | Quantum 2 let to Biogen | | |
| | | | Idec. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Teesside | North | 32,955 | Office scheme of five | Completed | 20% |
| Phase 1, 3 Acre | East | | buildings. Phase 1, | | |
| Site, Teesdale | | | Buildings 1, 2 and 4, | | |
| Business Park | | | completed. Building 1 | | |
| | | | part-let to HBoS. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Gateshead | North | 24,500 | The second of three Phase | Completed | 100% |
| Baltimore House | East | | 1 office buildings, | | |
| Baltic Business | | | Baltimore House, is | | |
| Quarter | | | adjacent to the pre-sold | | |
| | | | Open University HQ | | |
| | | | building, Chalk Hill, and | | |
| | | | is being marketed to let | | |
| | | | or for sale. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
| Filton, Bristol | South | 44,600 | Small unit office scheme | Phase 2 | 20% |
| Phase 1 & 2 | West | | for owner occupation or | Completes | |
| Brabazon Office | | | to let. | June 2009 | |
| Park | | | Phase 1 completed. Phase | | |
| | | | 2 on site, with one | | |
| | | | building pre-sold. | | |
+-------------------------+----------+---------+---------------------------+-----------+---------------+
Consented schemes
Sites with detailed planning permission
+------------------------+-------------+----------+----------------------------+--------------+
| Development | Region | Size (sq | Description | Terrace Hill |
| | | ft) | | share |
+------------------------+-------------+----------+----------------------------+--------------+
| Bracknell | South East | 78,895 | Prominent 7.9 acre site | 20% |
| Maxis III, | | | with planning for three | |
| Western Road | | | buildings. Phase 1, Maxis | |
| | | | I & II, on site. Phase 2, | |
| | | | Maxis III, pending. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Teesside | North East | 60,000 | Prime development site on | 100% |
| Resolution, | | | Teesdale Business Park. | |
| Teesdale Business Park | | | | |
+------------------------+-------------+----------+----------------------------+--------------+
| Teesside | North East | 22,828 | Office scheme of five | 100% |
| Phase 2, 3 Acre | | | buildings. Phase 1 | |
| Site, | | | completed. Phase 2, | |
| Teesdale Business Park | | | Buildings 3 & 5 fully | |
| | | | serviced plots. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Gateshead | North East | 31,545 | The third and final Phase | 100% |
| Admiral House | | | 1 office building, Admiral | |
| Baltic Business | | | House is adjacent to the | |
| Quarter | | | new Open University | |
| | | | building, Chalk Hill, and | |
| | | | the Baltic Business | |
| | | | Quarter completed | |
| | | | Baltimore House. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Victoria, SW1 | London | 135,368 | Substantial mixed use | 20% |
| Howick Place | | | development, with | |
| | | | resolution to grant | |
| | | | detailed planning consent. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Welwyn Garden | South East | 15,810 | Site with detailed | 100% |
| City | | | planning for small unit | |
| Broadwater Road | | | office scheme of seven | |
| | | | units. Located close to | |
| | | | railway station. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Croydon | South East | 260,133 | Office development site in | 100% |
| Chroma, George | | | prime location opposite | |
| Street | | | East Croydon railway | |
| | | | station. Consent for HQ | |
| | | | office increased to | |
| | | | 258,056 sq ft, plus 2,077 | |
| | | | sq ft of retail on ground | |
| | | | floor. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Bristol | South West | 53,143 | Existing city centre | 100% |
| Bristol Bridge | | | office building, with | |
| House | | | detailed planning consent | |
| 138/143 Redcliff | | | secured to provide 53,141 | |
| Street | | | sq ft. | |
+------------------------+-------------+----------+----------------------------+--------------+
| Southampton | South East | 116,000 | Mixed-use scheme, | 100% |
| Mayflower Plaza | | | including offices, hotel | |
| | | | and a forward sold | |
| | | | residential site. | |
+------------------------+-------------+----------+----------------------------+--------------+
Pending schemes
Medium-term developments held prior to detailed planning
+---------------------------+------------+----------+----------------------------------+--------------+
| Development | Region | Size (sq | Description | Terrace Hill |
| | | ft) | | share |
+---------------------------+------------+----------+----------------------------------+--------------+
| Teesside | North East | 99,500 | Office park with option to | 50% |
| Phase 2-5, Hudson | | | drawdown sites under preferred | |
| Quay | | | developer agreement with English | |
| Middlehaven | | | Partnership. | |
+---------------------------+------------+----------+----------------------------------+--------------+
| Gateshead | North East | 34 acres | Unserviced land with benefit of | 100% |
| Balance of site at | | | OPP. Whole 50 acre site has | |
| Baltic Business | | | planning consent for 1.5 million | |
| Quarter | | | sq ft of business use. | |
+---------------------------+------------+----------+----------------------------------+--------------+
| Stevenage | South East | 40 acres | Ten year option from March 2002 | 100% |
| Knebworth Innovation Park | | | for employment use | |
| | | | (such as business or science | |
| | | | park). Currently negotiating | |
| | | | planning consents. | |
+---------------------------+------------+----------+----------------------------------+--------------+
| Farnborough | South East | 273,000 | Site comprising 11.5 acres with | 100% |
| Aerospace Park | | | OPP for mixed use. | |
+---------------------------+------------+----------+----------------------------------+--------------+
| Middlesbrough | North East | 130,000 | Preferred developer for town | 100% |
| Central Gardens | | | centre urban regeneration scheme | |
| | | | to include offices and hotel. | |
+---------------------------+------------+----------+----------------------------------+--------------+
Retail development portfolio
Consented schemes
Sites with detailed planning permission
+--------------------+------------+----------+---------------------------------+---------------+
| Development | Region | Size (sq | Description | Terrace Hill |
| | | ft) | | share |
+--------------------+------------+----------+---------------------------------+---------------+
| Bishop Auckland | North East | 93,000 | Site with detailed planning | 100% |
| Phase 1, Food | | | consent for a foodstore, | |
| Store | | | pre-let to Sainsbury's | |
| | | | supermarket. | |
+--------------------+------------+----------+---------------------------------+---------------+
| Bishop Auckland | North East | 65,000 | Leisure complex with multiplex | 100% |
| Phase 2 | | | cinema, ten-pin bowling and | |
| | | | bingo, together with two | |
| | | | drive-through restaurant | |
| | | | facilities. | |
+--------------------+------------+----------+---------------------------------+---------------+
| Middlesbrough | North East | 128,000 | 16.8 acre cleared site with | 100% |
| Gateway, | | | existing consent for a | |
| Middlehaven | | | mixed-use scheme; non-food | |
| | | | retail warehouse and leisure | |
| | | | uses. | |
+--------------------+------------+----------+---------------------------------+---------------+
| Blyth, | North East | 15,000 | Adjacent to Phase 1. Detailed | 100% |
| Northumberland | | | bulky goods planning consent | |
| Phase 2, | | | for further 15,000 sq ft in | |
| Blyth Retail Park | | | three units. | |
+--------------------+------------+----------+---------------------------------+---------------+
| Helston | South West | 55,750 | Site with detailed planning | 100% |
| Retail Warehouse | | | consent. Contracted for sale to | |
| Site | | | Sainsbury's. | |
+--------------------+------------+----------+---------------------------------+---------------+
Pending schemes
Medium-term developments held prior to detailed planning
+--------------------+----------+--------------+----------------------------+---------------+
| Development | Region | Size (sq ft) | Description | Terrace Hill |
| | | | | share |
+--------------------+----------+--------------+----------------------------+---------------+
| Galashiels | Scotland | 15,000 | Small parcel of land held | 100% |
| Phase 2, | | | for strategic ownership, | |
| Gala Retail Park | | | forming access to Phase 2 | |
| | | | land. Site assembly and | |
| | | | planning consent required. | |
+--------------------+----------+--------------+----------------------------+---------------+
| Ashington Town | North | 30,000 | Conditional contract to | 100% |
| Centre | East | | acquire town centre retail | |
| Retail warehouse | | | warehouse site. | |
| site | | | | |
+--------------------+----------+--------------+----------------------------+---------------+
Industrial development portfolio
Current schemes
Developments completed or under construction
+------------------------+-----------+--------------+-------------------------+-----------+---------+
| Development | Region | Size (sq ft) | Description | Timing | Terrace |
| | | | | | Hill |
| | | | | | share |
+------------------------+-----------+--------------+-------------------------+-----------+---------+
| Eastbourne | South | 103,000 | Industrial and trade | Completed | 20% |
| Brampton Business Park | East | | counter scheme. | | |
| | | | Industrial now fully | | |
| | | | sold or let. Trade park | | |
| | | | unit marketing ongoing | | |
+------------------------+-----------+--------------+-------------------------+-----------+---------+
Consented schemes
Sites with detailed planning permission
+-------------------+-----------+--------------+-------------------------+-------------------+
| Development | Region | Size (sq ft) | Description | Terrace Hill |
| | | | | share |
+-------------------+-----------+--------------+-------------------------+-------------------+
| Welwyn Garden | South | 42,151 | Site with detailed | 100% |
| City | East | | planning for small unit | |
| Broadwater Road | | | industrial scheme of 13 | |
| | | | units. | |
+-------------------+-----------+--------------+-------------------------+-------------------+
Pending schemes
Medium-term developments held prior to detailed planning
+-------------------+----------+--------------+------------------------+--+------------------+
| Development | Region | Size | Description | | Terrace Hill |
| | | | | | share |
+-------------------+----------+--------------+------------------------+--+------------------+
| Christchurch | South | 9.1 acres | Proposed mixed-use | | 100% |
| Site at Grange | West | | scheme, to include | | |
| Road | | | industrial, care home | | |
| | | | and residential uses. | | |
+-------------------+----------+--------------+------------------------+--+------------------+
| | | | | | |
+-------------------+----------+--------------+------------------------+--+------------------+
Commercial investment portfolio
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Development | Sector | Region | Size | Description | Terrace Hill |
| | | | (sq ft) | | share |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Platts Eyot, | Mixed use | London | 12 | Listed island on the | 100% |
| TW12 | | | acres | Thames, at Hampton, with | |
| | | | | residential potential. | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Sheffield | Mixed use | North | 110,000 | Vacant department store, | 30% |
| Castle Gate | | | | let on long lease to | |
| House and | | | | BHS, together with | |
| 22-22 | | | | adjacent, occupied | |
| Haymarket | | | | corner retail unit. | |
| | | | | Redevelopment potential | |
| | | | | for mixed-use scheme. | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Bristol | Offices | South | 20,500 | Multi-let office | 100% |
| Canningford | | West | | building with future | |
| House 38 | | | | redevelopment potential. | |
| Victoria | | | | | |
| Street | | | | | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Teesside | Offices | North | 30,700 | First office building on | 50% |
| Phase 1, | | East | | a planned 160,000 sq ft | |
| Hudson Quay | | | | office park. | |
| Middlehaven | | | | Fully let to the Crown | |
| | | | | Prosecution Service and | |
| | | | | Hertel Limited. | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Kean House | Offices | London | 25,200 | Substantial | 100% |
| 11 Kingsway, | | | | refurbishment of an | |
| WC1 | | | | existing office building | |
| | | | | arranged over nine | |
| | | | | floors. | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
| Redditch | Industrial | Midlands | 232,680 | High bay distribution | 20% |
| REDD 42, | | | | warehouse. Let to iForce | |
| Ravensbank Business Park | | | | Limited, the | |
| | | | | e-fulfilment provider | |
| | | | | for John Lewis PLC. | |
+--------------------------+------------+----------+---------+--------------------------+---------------+
Residential investment portfolio
+-----------------+----------+------------------------------------------+----------------+
| Property | No. of | Description | Terrace Hill |
| Portfolio | units | | share |
+-----------------+----------+------------------------------------------+----------------+
| TH "Portfolio | 243 | Mixed portfolio of residential units, | 100% |
| One" | | principally in Scotland, with small | |
| | | representation in England. | |
+-----------------+----------+------------------------------------------+----------------+
| TH Residential | 1,714 | Portfolio of residential properties | 49% |
| plc | | located across the UK. | |
+-----------------+----------+------------------------------------------+----------------+
Scottish housebuilding sites
Sites completed, under construction or with detailed planning permission
+------------------+----------+------------------------------------------+----------------+
| Development | Size | Description | Timing |
| | (acres) | | |
+------------------+----------+------------------------------------------+----------------+
| Carnshalloch | 2 | Development of 16 units. | Completed |
| Avenue, Patna | | | |
+------------------+----------+------------------------------------------+----------------+
| Wellington | 0.5 | Refurbishment of a former hotel into 16 | Completed |
| Square, Ayr | | flats and three storey office building. | |
+------------------+----------+------------------------------------------+----------------+
| Cairn Road, | 1.6 | Development of 18 units. | Completed |
| Cumnock | | | |
+------------------+----------+------------------------------------------+----------------+
| Bertram House, | 11.5 | Former country house and grounds. | Phase 1 |
| Carnwath | | Development comprises | completed |
| | | Phase 1 conversion of country house into | |
| | | 11 flats and | |
| | | Phase 2 construction of 20 detached | |
| | | houses in the grounds. | |
+------------------+----------+------------------------------------------+----------------+
| Torbothie Road, | 22 | Former brickwork site. Development of | Phase 1 |
| Shotts | | 173 units. Phase 1 comprises 20 units. | completes 2009 |
+------------------+----------+------------------------------------------+----------------+
Sites held prior to pending detailed planning
+---------------------+--+----------+------------------------------------+--+----------------------+
| Development | Size | Description | Timing |
| | (acres) | | |
+---------------------+-------------+---------------------------------------+----------------------+
| Kersewell Avenue, | 3 | Site with planning consent for | Anticipated planning |
| Carnwarth | | nine units. Revised application | consent 2009. |
| | | being submitted to increase | |
| | | density. | |
+------------------------+----------+------------------------------------+-------------------------+
| Irvine Road, | 18 | Former brickwork site. Planning | Anticipated planning |
| Kilmarnock | | application submitted for 182 units. | consent 2009 |
+---------------------+-------------+---------------------------------------+----------------------+
| Patna Caravan Park, | 30 | Former caravan park. Potential for | Anticipated planning |
| Patna | | 250 units. | consent 2009 |
+---------------------+-------------+---------------------------------------+----------------------+
| Boghall Road, | 12 | Industrial brownfield land with | Anticipated planning |
| Carluke | | potential for 67 units. | consent 2009 |
+---------------------+-------------+---------------------------------------+----------------------+
| "Dunselma", | 3 | Former Church of Scotland home. | Anticipated planning |
| Fenwick | | Planning application submitted for 20 | consent 2009. |
| | | detached houses. | |
+---------------------+-------------+---------------------------------------+----------------------+
| Lower | 65 | Industrial brownfield land. Partly | Anticipated planning |
| Bathville, | | owned in JV. Potential for 500 units | consent 2010. |
| Armadale | | and a neighbourhood shopping centre. | |
+---------------------+-------------+---------------------------------------+----------------------+
| Mayfield | 10.9 | Industrial brownfield land. Currently | Anticipated planning |
| Brickworks, | | owned in JV. Potential for 90 units. | consent 2010 |
| Carluke | | | |
+---------------------+--+----------+------------------------------------+--+----------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR ILFILFDIEFIA
Thg (LSE:THG)
Historical Stock Chart
From Jun 2024 to Jul 2024
Thg (LSE:THG)
Historical Stock Chart
From Jul 2023 to Jul 2024
