RNS Number:4377A
Terrace Hill Group PLC
05 July 2004
For embargoed release at 7am 5 July 2004
Terrace Hill Group PLC ("the Group")
Half Yearly Report for the six months to 30 April 2004
CHAIRMAN'S STATEMENT
I am pleased to present the Group's Unaudited Accounts for the six months to 30
April 2004 and my Report on that half year.
Results
The results show substantial progress in our target of growing Net Asset Value
per share, which was up from 30.22p at 31 October 2003 to 35.07p at 30 April
2004, an increase of 16%.
The balance sheet shows that since 31 October 2003 the Group's Net Asset Value,
after allowing for minority interests, has risen from #46.532 million to #65.518
million, an increase of #18.986 million or 40.80%.
Of the increase in value, the two major factors were revaluation of investment
properties (#9.737 million) and a placing with institutional shareholders
(#8.128 million net of costs). This placing was effected on 29 April 2004, at
the end of the half year, with payment for the shares due on 5 May 2004, so that
of the debtors shown in the balance sheet #8.128 million was converted to cash
shortly after the date of the balance sheet. The other factors contributing to
growth of net asset value were issues of shares upon corporate acquisitions, and
profit.
At 30 April 2004 bank debt net of cash and the proceeds of the recent placing
stood at 45.00% of gross assets net as aforesaid (31 October 2003: 49.19%). As a
result we now have substantial financial resources and flexibility available to
pursue growth.
Pre tax (and post tax) profit for the half year of #776,000 included only modest
sales of investment and development properties. Operational profit, at #2.082
million, well exceeded the six monthly rates of the comparative periods shown
for the 18 months to 31 October 2003 and the year to 30 April 2003.
Corporate Acquisitions
During the half year we made formal offers for the outstanding share capital not
held by us or others with whom we were acting, of Grosvenor Land Holdings plc
("Grosvenor"), another AiM traded property group, and SERAH Properties plc
("SERAH"). In both cases we believe we have acquired at a substantial discount
to net asset value. By 30 April 2004, the acquisition of Grosvenor had advanced
to the point where the Accounts reflect our ownership of 70.66% of its capital,
the outstanding balance being reflected in minority interests in the amount of
#2.522 million. In the case of SERAH our Offer closed with us holding 83.13% of
its share capital.
Additional Directors
Of the institutions taking shares in the placing referred to above, the largest,
which has a notifiable interest of 7.48% in the Group, is Caledonia Investments
plc. The directors were delighted on 22 June 2004 to welcome to our Board
Caledonia's Associate Director Will Wyatt as a Non-executive Director, along
with Douglas Blausten, the former Chief Executive of Grosvenor, Chris Phillips
of Colliers CRE and Guy Brennan who was for many years a Managing Director,
Corporate Finance, of ABN Amro Bank.
Activities in the six months to 30 April 2004
We continued to progress the development of new properties, and to manage the
letting and improvement in value of properties completed. We sold the Health
and Fitness Centre, Foodstore and Nursery School (at an aggregate price of #7.5
million) developed in Joint Venture with HSBC for occupation by Esporta, Budgens
and Academy respectively at Queen Elizabeth Park in Guildford. Routine
residential property sales amounted to #8.583 million, primarily in England. We
acquired 36 flats in Manchester at a price of #4 million. The number of
residential units in our portfolio has fallen from 585 at 31 October 2003 to 535
at 30 April 2004. We continue to focus the portfolio on affordable housing in
Scotland, with a heavy emphasis on Glasgow, and the North of England, which we
believe is best sheltered from the current round of interest rate rises.
Current Trading
In the North East of England we are progressing new developments at Gallowgate,
Newcastle, at Baltic Business Park on Gateshead Quays and at Westminster House,
our latest office development in the highly successful Teesdale Business Park.
In London's West End we have seen increasing tenant interest in our developments
at 11 Berkeley Street, 16 Berkeley Street and 22 King Street, a location where
good rental growth is anticipated.
Since 30 April 2004 we have sold profitably, for #11.7 million, to Royal London
Asset Management a building known as Colston 33 in Bristol City Centre developed
in Joint Venture with Northridge Capital. At Queen Elizabeth Park, Guildford we
have now sold the first four units of the first phase of 13 units of our
development of office suites aimed at the owner occupier market.
We have purchased an industrial property at Edmonton, North London for #5
million for future redevelopment, leasing it back to the vendors for a short
period while we consider planning alternatives. Near Glasgow City Centre we
have purchased, at a price of #2.6 million, an excellent residential site
fronting onto Glasgow Green, which we intend to develop out as 64 units, mainly
2 bedroom flats with a few townhouses. We have also acquired, at a cost of #3
million, a 10.5 acre site at Tunbridge Wells where, with planning permission in
place, we plan to develop a 170,000 sq. ft. industrial park and are about to
start on the first phase.
Since 30 April 2004 we have also acquired, at a price of #1.825 million, the
outstanding 29.34% of the share capital of Grosvenor, which was reflected at the
Balance Sheet date in the minority interests as above at #2.522 million.
Dividend
The Directors have decided to pay an interim dividend in respect of the half
year under review of 0.3p per share. This dividend is at double the rate of the
final dividend paid for the preceding period and demonstrates our confidence in
our future growth prospects. We intend to maintain a progressive dividend policy
in future. This dividend will be paid on 25 August 2004 to shareholders on the
register at 13 August 2004.
Repurchase of Shares
We also propose a repurchase by the Group announced today of up to 2,000,000
shares at a price of 28p each. Again, we are providing an opportunity for small
shareholders to realise their shareholdings without costs.
The Future
I believe that we have an exciting future ahead with a business and an asset
base which should deliver good growth in shareholder value over the coming
years. Our development programme now amounts to around #500 million, of which
approaching #200 million is underway and #300 million is at planning stage.
Robert F M Adair
Chairman
5 July 2004
6 months to 18 months to Year to
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
(unaudited) (audited) (unaudited)
TURNOVER
Continuing operations 7,519 39,646 13,961
Acquisitions 1,771 - -
----- ----- -----
9,290 39,646 13,961
----- ----- -----
GROUP OPERATING PROFIT
Continuing operations 1,570 3,295 2,545
Acquisitions 512 - -
----- ----- -----
TOTAL OPERATING PROFIT 2,082 3,295 2,545
Continuing operations:
Amounts written off unlisted investments 4 (202) (202)
Gain/(loss) on disposal of fixed asset investment - 23 (2)
Net gain on disposal of investment property 456 7,123 3,202
Permanent diminution in value of an investment property - (300) -
Discontinued operations:
Gain/(loss) on liquidation of former subsidiary 143 (4) (4)
Net interest payable (1,909) (4,842) (3,319)
----- ----- -----
PROFIT ON ORDINARY
ACTIVITIES BEFORE TAX 776 5,093 2,220
Taxation charge - (872) (144)
----- ----- -----
PROFIT ON ORDINARY
ACTIVITIES AFTER TAX 776 4,221 2,076
Minority interest (71) (150) (93)
----- ----- -----
PROFIT ATTRIBUTABLE TO
MEMBERS OF PARENT COMPANY 705 4,071 1,983
Dividends (561) (625) (193)
----- ----- -----
144 3,446 1,790
----- ----- -----
Earnings per share - basic and diluted 0.453p 3.033p 1.599p
----- ----- -----
UNAUDITED SUMMARISED CONSOLIDATED BALANCE SHEET
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
FIXED ASSETS (unaudited) (restated) (restated)
Intangible assets
Positive goodwill 2,586 2,583 2,691
Negative goodwill (2,857) (1,307) (1,509)
----- ----- -----
(271) 1,276 1,182
Tangible assets
Investment properties 103,306 83,524 83,732
Other 206 22 180
----- ----- -----
103,512 83,546 83,912
Investments
Investments in associates 528 1,053 -
Other fixed asset investments 101 85 1,245
----- ----- -----
629 1,138 1,245
----- ----- -----
103,870 85,960 86,339
CURRENT ASSETS
Work in progress 21,972 18,046 38,934
Debtors 24,491 7,297 15,776
Cash at bank and in hand 5,696 14,013 2,994
----- ----- -----
52,159 39,356 57,704
CREDITORS: amounts falling due within one year
Borrowings (27,260) (26,428) (30,733)
Other creditors (8,263) (8,791) (15,171)
----- ----- -----
(35,523) (35,219) (45,904)
----- ----- -----
NET CURRENt ASSETS 16,636 4,137 11,800
----- ----- -----
TOTAL ASSETS LESS CURRENT LIABILITIES 120,506 90,097 98,139
CREDITORS: amounts falling due after more
than one year (51,482) (42,986) (54,971)
PROVISIONS FOR LIABILITIES AND CHARGES (477) (477) -
----- ----- -----
NET ASSETS 68,547 46,634 43,168
----- ----- -----
CAPITAL AND RESERVES
Called up share capital 3,737 3,079 3,094
Shares to be issued - 193 193
Share premium account 19,369 11,823 11,807
Revaluation reserve - investment properties 21,153 13,397 12,951
- other 17 6 3
Capital redemption reserve 821 821 807
Merger reserve 8,686 8,228 15,801
Profit and loss account 11,735 8,985 (1,533)
----- ----- -----
EQUITY SHAREHOLDERS FUNDS 65,518 46,532 43,123
MINORITY INTERESTS 3,029 102 45
----- ----- -----
68,547 46,634 43,168
----- ----- -----
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
6 months to 18 months to Year to
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
(unaudited) (audited) (unaudited)
Profit attributable to members of the
parent company 705 4,071 1,983
Unrealised surplus on revaluation of properties 9,737 8,145 6,258
Unrealised surplus/(deficit) on revaluation
of unlisted investments 11 2 (1)
----- ----- -----
Total recognised gains and losses relating
to period 10,453 12,218 8,240
----- ----- -----
GROUP STATEMENT OF CASH FLOWS
6 months to 18 months to Year to
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
(unaudited) (restated) (restated)
Cash (outflow)/inflow from operating activities (7,042) 14,993 (10,493)
Returns on investments and servicing of finance (1,965) (5,036) (4,269)
Taxation - (98) (36)
Capital expenditure and financial investment 8,162 50,476 40,465
Acquisitions and disposals (8,002) 276 310
Equity dividends paid (231) (393) -
----- ----- -----
Cash (outflow)/inflow before liquid resources
and financing (9,078) 60,218 25,977
Financing 2,231 (49,010) (25,121)
----- ----- -----
(Decrease)increase in cash (6,847) 11,208 856
----- ----- -----
Reconciliation of group operating profit to net cash (outflow)/inflow from
operating activities
#000 #000 #000
Operating profit 2,082 3,295 2,545
Depreciation 17 75 50
Loss on sale of other tangible fixed assets - 133 -
Positive goodwill amortisation and impairment losses 81 308 185
(Increase)/decrease in stock (3,136) 7,425 (7,776)
(Increase)/decrease in operating debtors (4,306) 7,974 (1,914)
Decrease in operating creditors (1,780) (4,217) (3,583)
----- ----- -----
Net cash (outflow)/inflow from operating
activities (7,042) 14,993 (10,493)
----- ----- -----
GROUP RECONCILIATION OF SHAREHOLDERS' FUNDS
6 months to 18 months to Year to
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
(unaudited) (audited) (unaudited)
Total recognised gains and losses 10,453 12,218 8,240
New shares issued 657 1,622 1,658
Shares to be issued, settled for cash (193) - -
Share premium arising on new shares issued 7,546 2,111 2,111
Merger reserve arising on new shares issued 1,084 6,519 6,519
Purchase of ordinary shares - (472) (371)
Ordinary dividends (561) (625) (193)
----- ----- -----
Total movements during the period 18,986 21,373 17,964
Opening shareholders' funds 46,532 25,159 25,159
----- ----- -----
Closing shareholders' funds 65,518 46,532 43,123
----- ----- -----
NOTES
BASIS OF PREPARATION
These interim accounts are unaudited but have been reviewed by the auditors
whose review report is set out in the half-yearly report. The abridged financial
information relating to the 18 months ended 31 October 2003 is based on an
extract from the latest financial statements, which have been filed with the
Registrar of Companies. The report of the auditors on these financial statements
was unqualified and did not contain a statement under section 237(2) or (3) of
the Companies Act 1985. Certain balance sheet figures as at 31 October 2003 and
30 April 2003 and cash flow information for the periods then ended have been
restated to reflect a change in accounting for a joint arrangement. There is no
change to net assets as previously reported. The financial information
summarised above does not constitute statutory accounts within the meaning of
section 240 of the Companies Act 1985.
EARNINGS PER ORDINARY SHARE
The calculation of basic and diluted earnings per ordinary share is based on the
following:
6 months to 18 months to Year to
30-Apr-04 31-Oct-03 30-Apr-03
#000 #000 #000
Profit 705 4,071 1,983
----- ----- -----
The weighted average number of ordinary shares
in issue during the period:
Basic and diluted 155,704,845 134,207,985 124,015,370
----- ----- -----
DIVIDEND
The company intends to pay an interim dividend of 0.30p per share.
HALF-YEARLY REPORT
The half-yearly report will be posted to shareholders shortly and copies will be
available, free of charge for one month, from the Company Secretary, Terrace
Hill Group PLC, James Sellars House, 144 West George Street, Glasgow, G2 2HG.
For further information please contact:
Robert Adair, Chairman, Terrace Hill Group PLC 01845 537 037
(Monday 5 July- 07732 784 208)
Ross Macdonald, Joint Managing Director,
Terrace Hill Group PLC 0141 332 2014
(Monday 5/Tuesday 6 July- 07710 459 649)
Alasdair Robinson, Noble & Company Limited 0131 225 9677
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SSSFDESLSEIW
Thg (LSE:THG)
Historical Stock Chart
From Jul 2024 to Aug 2024
Thg (LSE:THG)
Historical Stock Chart
From Aug 2023 to Aug 2024
