Final Results

Cardiff Property PLC 30 November 2000 The Cardiff Property plc 56 Station Road, Egham, Surrey TW20 9LF Tel: 01784 437444 Fax: 01784 439157 E-mail: webmaster@cardiff-property.com Web: www.cardiff-property.com FOR RELEASE 7.00 AM 30 NOVEMBER 2000 (The group, including Campmoss, specialises in property investment and development in the Thames Valley. The portfolio, valued in excess of £30m is primarily located to the west of London, close to Heathrow Airport and in Surrey and Berkshire.) PRELIMINARY RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2000 HIGHLIGHTS Group turnover £8.0m (1999: £3.4m) Property sales £6.6m (1999: £5.6m) Net asset value per share 575p (1999: 461p) +25% Profit before tax £2.6m (1999: £1.7m) +52% Earnings per share 90.7p (1999: 53.3p) +70% Total dividend for the year 4.8p per share (1999: 4.1p) +17% Final dividend 3.4p per share (1999: 2.85p) Gearing nil (1999: 16%) Richard Wollenberg, chairman commented: 'The group, including Campmoss, performed well, profits, earnings and net assets per share have risen substantially. The long-term economic prospects for the Thames Valley remain strong although I am of the view that the early part of 2001 will see some easing of the market. Our strategy is to maintain and increase our investments located to the west of London and the western sector of the M25 motorway.' For further information The Cardiff Property plc Richard Wollenberg 01784 437444 Old Mutual Securities Ltd Will Martin 020 7489 4653 Binns & Co Public Relations Ltd Brian Coleman-Smith 020 7786 9600 Chairman's statement Dear shareholder The group's policy of concentrating its property investment and development activities in the Thames Valley, more specifically to the west of London and western sector of the M25 motorway, has again proved successful. During the year under review, profits, earnings and net assets per share have risen substantially. Pre-tax profits for the year to 30 September 2000 increased by 52% to £2.56m (1999: £1.69m). The sale of completed developments amounting to £6.6m resulted in profits of £2.3m. Campmoss Property Company Limited, our 47.62% owned joint venture undertaking, contributed £0.15m (1999: £0.33m). Turnover totalled £8.0m (1999: £3.41m) which included gross rental income of £ 1.5m (1999: £1.4m) and sales of development properties of £6.6m (1999: £2.0m). No investment properties were sold during the year (1999: £3.6m). Net profit attributable to shareholders amounted to £2.56m (1999: £1.68m) and earnings per share were 90.7p (1999: 53.3p). Dividends Your directors recommend a final dividend of 3.4p per share (1999: 2.85p) making a total dividend for the year of 4.8p per share (1999: 4.1p), an increase of 17%. The final dividend will be paid on 16 February 2001 to shareholders on the register on 19 January 2001. Financial At the year-end, our commercial and residential investment portfolio, valued annually by Healey & Baker and Aitchison Raffety respectively, totalled £7.03m (1999: £6.6m). This figure excludes property in the course of development or those completed and being offered for sale which are included in stock at cost. The group's net assets increased to £16.1m (1999: £13.6m) equivalent to 575p per share (1999: 461p) an increase of 24.7%. Included in this figure is our share of the net assets of Campmoss Property of £4.4m (1999: £4.0m). The group's balance sheet remains strong with cash balances currently placed on deposit. Bank borrowing facilities have been renewed and remain available at rates linked to base rate. Long-term borrowings total £3.2m with nil gearing at the year-end (1999: 16%). The group's property portfolio It is well known that the Thames Valley has the highest concentration of telecommunications and high-tech businesses in the UK and many of the major IT companies have a presence here. The continuing growth of such companies, as well as businesses relocating to the Thames Valley remains a dominant factor in determining the demand for office space. The majority of prospective tenants continue to require new high-grade office space, primarily with adequate parking facilities. More recently an important requirement is the accessibility to a skilled labour force. The ability to draw on Central London and to the north and west of the M25 motorway meets this criterion, further establishing the Thames Valley as an ideal location. Competition for office space has been intense over the last twelve months and demand for new office buildings in the Thames Valley from both occupiers and institutional investors has remained competitive. Rents have inevitably responded to this demand, increasing by up to 15% over the year. Commercial property located in the Thames Valley has seen above average capital and rental growth in recent years. This trend has continued during the last quarter of 2000 but I am of the view that the early part of 2001 may see some easing of the market. I remain concerned that the accelerating growth being reported by some of the major IT and telecom companies may not be matched by future profitability. Residential values in Surrey and Berkshire have also seen a good increase during the year. The market needs to pause but demand for new homes and the difficulty in obtaining planning permissions will limit any major correction in price levels. Commercial investments The majority of our commercial property investment portfolio is located to the west of Heathrow Airport at Windsor, Egham and Hatton Cross. We also retain a property in Cardiff. These properties are primarily let on long-term institutional leases to good covenants and produce an annual gross rental of £ 570,000. A number of rent reviews are expected to take place over the next two years. Commercial developments The development of a new 25,000 sq ft headquarters office building known as The Clock Tower, Brookwood was completed during the year. The subsequent long-term letting to a prime covenant attracted considerable institutional interest in the freehold and, as reported at the interim stage, the building was sold realising a substantial profit for the group. Part of the site has been retained for either residential or office use. The Windsor Business Centre, totalling 20,000 sq ft, comprises six individual business units, three of which are let and two are under offer. The remaining unit is being upgraded, increasing the amount of office space. The completed and fully let development is expected to produce gross rents in excess of £ 210,000 per annum. Residential At the beginning of our financial year we completed the sale of a new executive house at Thames Ditton, Surrey. Development work at our major project at Hambledon, Surrey, is complete and the magnificent 7,000 sq ft country home, set in 8 acres of landscaped grounds, is being offered for sale. A considerable amount of time and effort has been expended in completing this exceptional property, a photograph of which will appear on the inside front cover of the annual report. The high standard of workmanship and enviable location has attracted a number of interested parties. Our property at Clarence Road, Windsor, adjacent to a previously owned site sold last year to a national house builder, is the subject of a revised planning application for up to 9 flats. The property continues to be let on a short-term basis. Campmoss Property Company Limited The directors of Campmoss re-assess the value of the company's investment property portfolio annually, taking into account external advice where available and market conditions. Property in the course of development is held at cost. The total portfolio at 30 September 2000 was valued at £20.7m (1999: £18.5m). Gross rental income from the commercial investment property portfolio at Britannia Wharf, Woking, The Priory, Burnham, and Kiln Lane, Bracknell, all developed by the company, now totals in excess of £1.4m per annum. The buildings are primarily let to well known covenants on long-term leases. The commercial property development portfolio includes Gowring House, Bracknell, York Road and Pakseal House, Maidenhead, and the recently purchased Tangley Place, Worplesdon. Individual planning applications for new high-grade offices, totalling in excess of 100,000 sq ft, have been submitted in respect of these properties. The buildings at Gowring House and York Road have been let on a short-term basis in anticipation of a lengthy planning process. Quoted investments We continue to retain our shareholding in Grantchester Holdings PLC, HACAS Group PLC and The Celltalk Group plc. The current market value shows a substantial increase over cost. I remain a director of both HACAS and Celltalk. A small investment in an unquoted company has been written down at the year-end. Management and staff The group has had another successful year and on behalf of shareholders I wish to thank our small management team and joint venture partners for their support and achievements during the period. Post balance sheet events and outlook A further letting at The Windsor Business Centre has now completed and I remain optimistic of an early sale of our residential property at Hambledon. As your board takes a cautious view of the market, we have been selective in making offers for new sites. At the time of writing, offers have been submitted for a commercial property at Woking and two residential properties also in Surrey. Our joint venture partner, Campmoss Property, has completed further lettings at Kiln Lane, Bracknell, leaving one unit which is currently under offer. Detailed discussions continue with the relevant local authorities to pursue the determination of planning consents for the proposed office schemes. The long-term economic prospects for the Thames Valley remain strong and, despite the cyclical nature of the property market, our strategy is to maintain and increase our investment in the area. The group is well placed to benefit from its existing commercial and residential development portfolio. I look forward to reporting at the half-year stage with news of further progress. J Richard Wollenberg chairman Consolidated profit and loss account for the year ended 30 September 2000 2000 1999 £ £ '000 '000 Turnover Group and share of joint venture undertaking 8,012 3,413 Less: share of joint venture undertaking (785) (769) ______ ______ Group turnover 7,227 2,644 Cost of sales (4,357)(1,109) ______ ______ Gross profit 2,870 1,535 Administrative expenses (512) (507) Other operating income 167 105 ______ ______ Operating profit Group 2,525 1,133 Share of operating profit in joint venture undertaking 570 689 ______ ______ Total 3,095 1,822 Profit on sale of investment property (group) - 307 Profit on sale of other investments (group) - 112 Amounts written off investments (group) (50) - ______ ______ Profit on ordinary activities before interest 3,045 2,241 Interest receivable and similar income Group 174 102 Share of joint venture undertaking 2 6 Interest payable Group (242) (297) Share of joint venture undertaking (420) (363) ______ ______ Profit on ordinary activities before taxation 2,559 1,689 Tax on profit on ordinary activities - (13) ______ ______ Profit on ordinary activities after taxation being profit for the 2,559 1,676 financial year attributable to shareholders Dividends (134) (117) ______ ______ Retained profit for the financial year 2,425 1,559 ====== ====== The above results relate entirely to continuing activities. There were no acquisitions or disposals of businesses during the year. Statement of total recognised gains and losses for the year ended 30 September 2000 2000 1999 £'000 £'000 Group Profit for the financial year 2,559 1,676 Unrealised surplus on revaluation of investment properties in the 327 185 year Share of unrealised surplus on revaluation of investment 286 446 properties in joint venture undertaking ______ ______ Total recognised gains and losses relating to the financial year 3,172 2,307 ===== ===== Consolidated balance sheet at 30 September 2000 2000 1999 £'000 £'000 £'000 £'000 Fixed assets: Tangible assets: Investment properties 7,025 6,600 Other 18 31 ______ ______ 7,043 6,631 Investments: Investment in joint venture undertaking Share of gross assets 10,401 9,274 Share of gross liabilities (6,005) (5,316) ______ ______ 4,396 3,958 Other investments 748 468 ______ ______ 5,144 4,426 ______ ______ 12,187 11,057 Current assets Stock and work in progress 3,290 5,004 Debtors 1,825 389 Cash at bank and in hand 3,464 1,179 ______ ______ 8,579 6,572 Creditors: amounts falling due within one (1,301) (798) year _____ ______ Net current assets 7,278 5,774 ______ ______ Total assets less current liabilities 19,465 16,831 Creditors: amounts falling due after more (3,200) (3,200) than one year Provisions for liabilities and charges (205) (75) ______ ______ Net assets 16,060 13,556 ===== ===== Capital and reserves Called up share capital 559 587 Share premium account 4,815 4,810 Investment property revaluation reserve 4,242 3,629 Other reserves 2,075 2,046 Profit and loss account 4,369 2,484 ______ ______ Shareholders' funds - equity 16,060 13,556 ===== ===== Consolidated cash flow statement for the year ended 30 September 2000 2000 1999 £'000 £'000 Cash inflow from operating activities 3,272 1,412 Returns on investment and servicing of finance (44) (213) Taxation (5) (17) Capital expenditure and financial investment (428) 3,618 Equity dividends paid (123) (113) ______ ______ Cash inflow before financing 2,672 4,687 Financing (534)(2,403) ______ ______ Increase in cash in the year 2,138 2,284 ===== ===== Reconciliation of net cash flow to movement in net debt Increase in cash in the year 2,138 2,284 Cash inflow from loan finance - 1,300 ______ ______ Movement in net debt in the year resulting from cash flows 2,138 3,584 Net debt at beginning of year (2,188)(5,772) ______ ______ Net debt at end of year (50)(2,188) ===== ===== Reconciliation of operating profit to net cash inflow from operating activities Operating profit - group 2,525 1,134 Depreciation charges 13 12 Decrease/(increase) in stock and work in progress 1,714(1,863) (Increase)/decrease in debtors (1,425) 2,171 Increase/(decrease) in creditors and provisions 445 (42) ______ ______ Net cash inflow from operating activities 3,272 1,412 ===== ===== Summary preliminary results for the year ended 30 September 2000 2000 1999 £ £ '000 '000 Turnover 8,012 3,413 Gross rental income 1,454 1,417 Profit on ordinary activities before taxation 2,559 1,689 Taxation - 13 Profit for the financial year attributable to shareholders 2,559 1,676 Dividend: Interim 1.4p (1999: 1.25p) per share 39 33 Final 3.4p (1999: 2.85p) per share 95 84 Earnings per share: Basic 90.7 53.3 Diluted 89.6 53.0 Notes i) Basic earnings per share has been calculated using the weighted average number of ordinary shares in issue during the year of 2,822,241 (1999: 3,143,482). Diluted earnings per share has been calculated in accordance with FRS14. ii) The taxation charge represents principally irrecoverable ACT. iii) The board recommends that the final dividend be increased to 3.4p (1999: 2.85p) payable on 16 February 2001 to shareholders on the register at 19 January 2001, giving a total increase for the year of 17%. iv) The annual general meeting will be held on 25 January 2001. v) The financial information for the year ended 30 September 1999 has been extracted from the audited financial statements which have been filed with The Registrar of Companies. The auditor's report on these financial statements was unqualified. vi) The financial information for the year ended 30 September 2000 has been extracted from the audited financial statements which will shortly be sent to shareholders and filed with The Registrar of Companies. The auditor's report on these financial statements is unqualified. vii) The financial information contained in this preliminary announcement does not constitute statutory accounts within the meaning of S240 of the Companies Act 1985.

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