Final Results

Fletcher King PLC
08 August 2023
 

 

FLETCHER KING PLC

Audited results for the Year Ending 30 April 2023

 

Highlights

 

·      Revenue for the year of £3,079,000 (2022: £2,967,000)

·      Statutory profit before tax of £192,000 (2022: £134,000)

·      Adjusted profit before tax of £165,000 (2022: £144,000) *

·      Adjusted basic earnings per share of 2.01p (2022: 1.73p) **

·      Final proposed dividend: 0.75p per share (2022: 0.50p per share)

·      Significant cash reserves: £2.8m as at 30 April 2023 (2022: £3.4m)

 

*Adjusted profit before tax is before share-based payment expenses and after other comprehensive income (see note 2). The Board considers the adjusted results to be an important measure of performance due to the nature of the Company, and with share options being awarded to directors and key staff only.

 

**Adjusted basic earnings per share is calculated using adjusted profits (see note 4).

 

 

The Annual Report and Accounts will shortly be posted on the Company's website and a further announcement will be made when the document is sent to shareholders.

 

Commenting on the results, David Fletcher, chairman of Fletcher King Plc said:

 

"We are pleased to report improved results compared with last year and to be able to recommend an increased dividend payment. We have started the new financial year with some encouraging instructions and are optimistic for the forthcoming period".

 

This announcement contains inside information for the purposes of the UK Market Abuse Regulation and the Directors of the Company are responsible for the release of this announcement.

 

 

For further information, please contact:

 


Fletcher King plc

Tel: +44 (0) 20 7493 8400

David Fletcher, Non-Executive Chairman

Peter Bailey, Finance Director




Cairn Financial Advisers LLP

Tel: +44 (0) 20 7213 0880

(Nominated Adviser)


James Caithie

Liam Murray




 




 


 

CHAIRMAN'S STATEMENT

 

Results

 

Revenue for the year was £3,079,000 (2022: £2,967,000). Adjusted profit before tax (see note 2) was £165,000 (2022: £144,000). Statutory profit before tax was £192,000 (2022: £134,000).

 

The Board considers the adjusted results to be an important measure of performance and to be more representative of performance for the year than the statutory results (which have been prepared in accordance with International Financial Reporting Standards).

 

Dividend

 

The Board is proposing a final dividend of 0.75p per share. The final dividend is subject to shareholder approval at the AGM and will be paid on 27 October 2023 to shareholders on the register at the close of business on 29 September 2023. With no interim dividend paid (2022: £nil per share) the dividend for this year will amount to 0.75p per share (2022: 0.5p per share).

 

The Commercial Property Market

 

Looking back to my statement twelve months ago, I reported that both the letting and capital markets were considerably more buoyant than the previous year. Regrettably that state of affairs did not continue.

 
Due to the uncertainties of the economy, with interest rates rising and inflation falling much more slowly than expected, the commercial property capital markets are currently moribund. The potential for a change of Government is further clouding investors' vision and whilst there is a considerable volume of funds waiting to enter the commercial property market, the timing is unpredictable.


In contrast to the property capital markets, the letting markets, particularly in London and other big cities, are still reasonably active although this is primarily for grade A office space which is still in demand with higher rents achieved than in the previous year.

 

Business Overview

 

Despite the difficult market I am pleased to report an overall growth in turnover and profit for the year.


Once again, Property Asset and Fund Management enjoyed a strong year with new clients added.


Bank valuations also continued to grow, with an increase in instructions from new lenders.


I am pleased to report that, at last, rating appeals moved ahead and some very long-standing large appeals were successfully concluded and hopefully that progress will continue.


The Investment department has had a very difficult year, along with most in the property industry, and recorded its worst results for some time. We believe this was a reflection of falling capital values resulting from the political and economic uncertainties reported above.

 

Outlook

 

It continues to be impossible to accurately predict the future of the property markets and thus our performance, whilst current uncertainties prevail. Nevertheless, we are reasonably optimistic for the coming year particularly as we are in discussion with a number of potential new Property Management instructions.


We anticipate that the volume of valuations will continue to grow and we expect rating appeals to do likewise.


We also expect the Investment Department to do much better this coming year but the volume of their work is particularly difficult to predict under current circumstances.

 
The general state of the market has not been conducive to generating activity with our new large shareholder but we will continue to look for opportunities to collaborate in the forthcoming period.


As usual, our balance sheet and cash reserves remain strong and that continues to be of great importance in these volatile times.


Our loyal clients and hard-working and talented staff have enabled us to perform well this year and on behalf of the Board I thank them all.

 

 

DAVID FLETCHER

CHAIRMAN

7 August 2023

 



CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

for the year ended 30 April 2023

 

 

Note

2023

2022

 

 

£000

£000

 


 


Continuing operations


 


Revenue

 

3,079

2,967

 

 

 


Employee benefits expense

 

(1,704)

(1,630)

Depreciation expense

 

(197)

(346)

Gain recognised on remeasurement of lease liability

 

-

125

Other operating expenses

Share based payment expense

 

(1,064)

(17)

(1,014)

(10)

 

 

(2,982)

(2,875)


 

 


Other operating income

 

51

39

Investment income

 

42

18

Finance income

 

21

-

Finance expense

 

(19)

(15)

 

 

 


Profit before taxation

 

192

134


 

 


 

 



Taxation

 

41

18

 

 

 


Profit for the year

 

233

152

 

 

 


Other comprehensive income: amounts not to be

 

 


reclassified to profit or loss

 

 


Fair value loss on financial assets through

 

(44)

-

other comprehensive income

 

 


 

 

 


Total comprehensive income for the year attributable to equity shareholders

 

 

 

 

189

 

152

Earnings per share

 

 


Basic

Diluted

 

4

4

 

2.27p

2.09p

 

1.62p

1.48p

 

Adjusted earnings per share

 

 


 

 

 


Basic

4

2.01p

1.73p

Diluted

 

4

1.84p

1.58p


 

 


 



CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 30 April 2023

 

 

 

 

2023

2022

 

£000

£000

 

 


Assets

 


Non-current assets

 


Intangible assets

61

76

Property, plant and equipment

205

266

Right-of-use asset

378

494

Financial assets

485

529

Deferred tax assets

73

32


1,202

1,397

 

 


Current assets

 


Trade and other receivables

1,553

1,375

Corporation tax debtor

-

97

Cash and cash equivalents

2,755

3,365


4,308

4,791


 



 


 

 


Total assets

5,510

6,188

 

 


Liabilities

 


Current liabilities

 


Trade and other payables

901

1,124

Provisions

-

25

Lease liabilities

141

610

 

1,042

1,759

 

 


Non-current liabilities

 


Lease liabilities

286

402


 


 

 


Total liabilities

1,328

2,161

 

 


Shareholders' equity

 


Share capital

1,025

1,025

Share premium

522

522

Investment revaluation reserve

(145)

(101)

Share option reserve

27

10

Retained Earnings

2,753

2,571

Total shareholders' equity

4,182

4,027


 


Total equity and liabilities

5,510

6,188




 

 

 

 



CONSOLIDATED STATEMENT OF CASH FLOWS

for the year ended 30 April 2023

 

 

 

 

2023

2022

 

£000

£000

 

 


Cash flows from operating activities

 


Profit before taxation from continuing operations

192

134

Adjustments for:

 


Movement in provision

(25)

(75)

Depreciation and amortisation expense

197

346

Remeasurement of lease liability

-

(125)

Investment income

(42)

(18)

Finance income

(21)

-

Finance expense

19

15

Share based payment expense

17

10


 


Cash flows from operating activities before

movement in working capital

 


337

287


 


Increase in trade and other receivables

(224)

(181)

(Decrease)/increase in trade and other payables

(223)

216

 

 


Cash (absorbed by) / generated from operations

(110)

322


 


Taxation received

97

-


 


Net cash flows from operating activities

(13)

322


 


Cash flows from investing activities

 


Purchase of fixed assets

(5)

(352)

Investment income

42

18

Finance income

21

-

Net cash flows from investing activities

58

(334)


 


Cash flows from financing activities

 


Lease payments

(604)

(1)

Proceeds of share placing

-

547

Placing costs

-

(61)

Dividends paid to shareholders

(51)

-

Net cash flows from financing activities

(655)

485


 


Net (decrease)/increase in cash and cash equivalents

(610)

473

Cash and cash equivalents at start of year

3,365

2,892

Cash and cash equivalents at end of year

2,755

3,365

 

 

 


 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 April 2023

 

 


 

Note

 

Share

capital

 

Share

premium

Investment

Revaluation

Reserve

Share option reserve

 

Retained

Earnings

 

TOTAL

EQUITY

 

 

£000

£000

£000

£000

£000

£000









Balance as at 1 May 2021

 

921

140

(101)

-

2,419

3,379


 

 

 

 

 

 

 

Total comprehensive income for the year

 

-

-

-

-

152

152

Share issue

 

104

443

-

-

-

547

Cost of share issue

 

-

(61)

-

-

-

(61)

Share based payment expense

 

-

-

-

10

-

10


 

 

 

 

 

 

 


 

 

 

 

 

 

 

Balance at 30 April 2022

 

1,025

522

(101)

10

2,571

4,027








 

Profit for the year

 

-

-

-

-

233

233

Fair value loss on financial assets

through other comprehensive income

 

-

-

(44)

-

-

(44)

Share based payment expense

 

-

-

-

17

-

17

Equity dividends paid

2

-

-

-

-

(51)

(51)


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance at 30 April 2023

 

1,025

522

(145)

27

2,753

4,182

 

 

 

 

 

 

 

 

 

 



 NOTES

 

 

1. General information

 

Whilst the financial information included in this preliminary announcement has been prepared in accordance with UK-adopted international accounting standards, this announcement does not itself contain sufficient information to comply with IFRSs.

 

The financial information is presented in pounds sterling rounded to the nearest thousand, and prepared in accordance with UK-adopted international accounting standards and under the historical cost convention, except for the revaluation of certain financial assets. The financial information set out in this announcement does not comprise the Group's statutory accounts for the years ended 30 April 2023 or 30 April 2022.

 

The financial information for the year ended 30 April 2022 is derived from the statutory accounts for that year which have been delivered to the Registrar of Companies. The auditors reported on those accounts; their report was unqualified and did not contain a statement under either Section 498 (2) or Section 498 (3) of the Companies Act 2006 and did not include references to any matters to which the auditor drew attention by way of emphasis.

 

The financial information for the year ended 30 April 2023 is derived from the audited statutory accounts for the year ended 30 April 2023 on which the auditors have given an unqualified report, that did not contain a statement under section 498(2) or 498(3) of the Companies Act 2006 and did not include references to any matters to which the auditors drew attention by way of emphasis. The statutory accounts will be delivered to the Registrar of Companies following the Company's annual general meeting.

 

 

 

2. Alternative performance measures - profit reconciliation

 

The reconciliation set out below provides additional information to enable the reader to reconcile to the numbers discussed in the Chairman's Statement and Highlights section.

 

Year ended 30 April

2023

2022

 

£000

£000

 

 


Profit before taxation

192

134

Add back: Share based payment expense

17

10

Include: Fair value loss on financial assets through OCI

(44)

-


 


Adjusted profit before share-based payment expense and taxation

165

144


 


Taxation

41

18


 


Adjusted profit after tax for the year

206

162

 

 

The fair value loss on financial assets represents the unrealised loss in the year on the revaluation of the Group's interest in the SHIPS 16 syndicate.

 

 

 

 

 

 

 

 

3.  Dividends

 

Year ended 30 April

2023

2022

 

£000

£000

Equity dividends on ordinary shares:

 


Declared and paid during year

 


Ordinary final dividend for the year ended 30 April 2022: 0.50p per share (2021: nil)

51

 

-

 

Interim dividend for the year ended 30 April 2023: nil per share

(2022: nil)

-

-


 



51

-


 


Proposed ordinary final dividend for the year ended

30 April 2023: 0.75p per share

 

77

 

 

 

 

4. Earnings per share

 

Number of shares

2023

No

2022

No

 

 


Weighted average number of shares for basic earnings per share

Share options

10,252,209

920,000

9,375,425

920,000

 

Weighted average number of shares for diluted earnings per share

 

11,172,209

 

 

10,295,425

 


 


 

 

Earnings

 

 

£000

 

 

£000

 

Profit after tax for the year

 

233

 

152

(used to calculate the basic and diluted earnings per share)

 


Add back: Share based payment expense

17

10

Include: Fair value loss on financial assets through OCI

(44)

-


 


Adjusted profit after tax for the year

206

162

(used to calculate the adjusted basic and diluted earnings per share)

 


 

 

Earnings per share

 

 


Basic

Diluted

2.27p

2.09p

1.62p

1.48p

 

 

Adjusted earnings per share

 

Basic

Diluted

 

 

 

 

 

 

2.01p

1.84p

 

 

 

 

1.73p

1.58p

 

 

 

 

Forward Looking Statements

 

Certain statements in this announcement are forward-looking statements relating to the Company's operations, performance and financial position based on current expectations of, and assumptions and forecasts made by, management.  They are subject to a number of risks, uncertainties and other factors which could cause actual results, performance or achievements of the Company to differ materially from any outcomes or results expressed or implied by such forward-looking statements.  Undue reliance should not be placed on such forward looking statements.  They are made only as of the date of this announcement and no representation, assurance, guarantee or warranty is given in relation to them including as to their accuracy, completeness, or the basis on which they are made.

 

 

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