Final Results
Gresham House PLC
29 April 2002
Letter to: RNS
This is to advise you that the Board of Directors of this Company have approved
the attached Preliminary Final Statement and Dividend for the year ended 31st
December 2001 for announcement to The Stock Exchange.
The Record date for the final dividend will be 17th May 2002 and the dividend
will be payable on 21st June 2002 with Warrants posted by first class mail on
20th June 2002.
Letter from: Gresham House PLC
CHAIRMAN'S STATEMENT
We are pleased to report that the revenue result for the year ended 31st
December 2001 reflect progressive improvement after excluding the exceptional
share dealing profit of £4.9 million included last year. Rental income has
remained steady, dividend and interest income has increased by 29% and property
provisions have been reduced from £1.4 million last year to £251,000.
Whilst revenue has remained strong, there has been a substantial drop in the
value of our holding of Transense Technologies which we continue to hold
anticipating that the longer term prospects remain attractive. After a share
split Transense stood at an equivalent price of 606.75p at 31st December, 2000,
393p at the year end and stood at 205p as at close of business on 26th April,
2002. The net effect of this fall in value has cancelled out most of our revenue
gain.
As a result the basic Net Asset Value per ordinary share has fallen 1.52% whilst
the FT 100 index for the same period fell from 6,222.5 to 5,242.4, representing
a comparative drop of 15.75%.
Shareholders will recall from a Circular dated 30th November, 2001 that the 2.5%
Gresham House Finance Secured Loan Stock was due for redemption on 31st
December, 2001. I can now report that £5.68 million of the Issue was redeemed at
par and £2.36 million was maintained, of which £1.98 million is held by Security
Change Limited, a wholly owned subsidiary. At the same time applications were
received from subscribers for £5.66 million of 8% Secured Loan Stock 2006, of
which £3.67 million was accepted and allotted. As a result the net effect was to
reduce borrowings in Gresham House Finance plc by £2 million.
In 1996 Gresham participated in the formation of Image Scan Holdings plc and at
the year end held 1.75 million ordinary shares at a cost of £328,000. Image
Scan's core technology relates to innovative imaging techniques, their
interpretation and application. It has developed an expertise, supported by
patent applications, in multi-view X-Ray imaging, where it is possible to
extract three-dimensional information from objects under inspection. It has
particular relevance in the field of security, such as airport baggage
inspection, and in industrial inspection, evidenced by in-line and on-line 3D
X-Ray inspection of assembled high value and safety critical components.
I am pleased to report that Image Scan was introduced on the Alternative
Investment Market ('AIM') on 25th April, 2002 raising approximately £750,000
before expenses at a price of 65p per share. Gresham increased its holding to
1.808 million shares which, at the issue price, values its holding at £1.175
million.
Your Board proposes that the final dividend be doubled from 1.5p to 3.1p per
share.
We continue to seek out innovative early stage investments in companies that
have a real prospect of high growth. As shareholders will appreciate this
strategy, whilst producing substantial gains in those young companies that
succeed, also carries with it a high risk of failure with those that fail to
capitalise on their innovations or take advantage of their market opportunities.
A P Stirling
29th April, 2002 Chairman
GRESHAM HOUSE plc
PRELIMINARY FINAL STATEMENT
CONSOLIDATED STATEMENT OF TOTAL RETURN
for the Year ended 31st December, 2001
2001 2000
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £' 000 £'000 £'000
(Losses)/gains on Investments - (2,270) (2,270) - 10047 10,047
Income:
Dividend and Interest Income 557 - 557 431 - 431
Rental Income 3,008 - 3,008 3,101 - 3,101
Other operating income 933 - 933 5,057 - 5,057
4,498 (2,270) 2,228 8,589 10,047 18,636
Other expenses (1,019) (1,019) (2,405) - (2,405)
Net return before finance costs and taxation 3,479 (2,270) 1,209 6,184 10,047 16,231
Interest payable and similar charges (1,277) - (1,277) (1,513) - (1,513)
Discount on loan acquired - - - 525 - 525
Return on ordinary activities before taxation 2,202 (2,270) (68) 5,196 10,047 15,243
Taxation - - (6) - (6)
Return on ordinary activities after
taxation attributable to equity shareholders 2,202 (2,270) (68) 5,190 10,047 15,237
Dividend - Equity shares (136) - (136) (64) - (64)
Transfer to reserves 2,066 (2,270) (204) 5,126 10,047 15,173
Basic return per Ordinary Share 50.8p (52.3)p (1.5)p 122.4p 237.0p 359.4p
Diluted return per Ordinary Share 47.8p (52.3)p (4.5)p 115.1p 222.9p 338.0p
Statement of Total Recognised Gains and Losses
Group
2001 2000
£'000 £'000
Profit for the financial year 2,202 5,190
Net movement on capital reserves (2,270) 10,047
Revaluation of investment properties 235 -
167 15,237
Notes
(i) The revenue column of this statement is the consolidated profit and loss
account of the group.
(ii) In accordance with the Company's accounting policies the above figures take
into account the results of significant investments only to the extent of
dividends received amounting to £29,716 .
(iii) Dividends - Ordinary shares:
- proposed final dividend of 3.1p per share (2000: 1.5p) payable on
21st June, 2002 to shareholders on the register at 17th May, 2002. 136 64
(iv) The summary of results for the year ended 31st December, 2001 does not
constitute statutory accounts within the meaning of s240 of the Companies
Act 1985. The full statutory accounts which will be available to
shareholders by 15th May, 2002 have not been reported on by the Company's
auditors and have not been delivered to the Registrar of Companies. Full
accounts in respect of the year ended 31st December, 2000 have been
delivered to the Registrar of Companies and the Auditor's Report on those
accounts was unqualified.
(v) Basic revenue and capital returns per ordinary share are based on the net
revenue return on ordinary activities before deduction of dividends of
£2,202,000 (2000: £5,190,000) and on the capital return of £(2,270,000)
(2000: £10,047,000) respectively, and on 4,337,288 (2000: 4,239,712)
ordinary shares being the weighted average of those in issue during the
year.
The diluted revenue per ordinary share is based on the net revenue return on
ordinary activities before deduction of dividends of dividends of £2,202,000
(2000: £5,190,000) and on 4,608,876 (2000: 4,506,941) shares. The number of
shares is based upon the weighted average number of shares in issue during the
year together with 271,588 (2000: 267,229) shares deemed to have been issued at
nil consideration pursuant to (i) options outstanding and (ii) the maximum
number of shares that can be issued under the terms of the 8% Secured Loan Stock
issued by Gresham House Finance plc.
Since the capital return for the year ended 31st December, 2001 was a loss,
there is no dilution applicable to the capital return per share for the year.
GRESHAM HOUSE plc
PRELIMINARY FINAL STATEMENT
CONSOLIDATED BALANCE SHEET
as at 31st December, 2001
2001 2000
£'000 £'000
Investments
Securities 10,203 8,631
Properties 28,883 27,731
Tangible assets 406 485
39,492 36,847
Current assets 7,315 13,131
Creditors - amounts falling due
within one year 3,771 10,086
Net current assets 3,544 3,045
Total assets less current liabilities 43,036 39,892
Creditors - amounts falling due
after more than one year 18,671 15,822
Deferred income 245 -
24,120 24,070
Capital and reserves
Called up share capital 1,092 1,073
Share premium account 242 242
Other reserves
Revaluation reserve 8,064 7,829
Capital reserve - realised 22,875 22,918
Capital reserve - unrealised 2,968 5,195
Revenue reserves (11,121) (13,187)
Equity shareholders' funds 24,120 24,070
Basic Net Asset Value per ordinary share 552.2p 560.7p
Diluted Net Asset Value per ordinary share 519.9p 527.8p
Notes
The basic net asset value per ordinary share is calculated by reference to the
group net assets as at 31st December, 2001 of £24,120,000 (2000: £24,070,000)
and 4,368,000 (2000: 4,293,000) ordinary shares being the number of ordinary
shares in issue at the year end.
The diluted net asset value per ordinary share is calculated by reference to the
group net assets as at the year end of £24,120,000 (2000: £24,070,000) and
4,639,589 (2000: 4,560,229) ordinary shares in issue. The number of shares is
based upon the number of shares in issue at the year end together with 271,588
(2000:267,229) shares deemed to have been issued at nil consideration pursuant
to (i) the options outstanding at the year end and (ii) the maximum number of
shares that can be issued under the terms of the 8% Secured Loan Stock issued by
Gresham House Finance plc, in accordance with Financial Reporting Standard No.
14.
GRESHAM HOUSE plc
PRELIMINARY FINAL STATEMENT
CONSOLIDATED CASH FLOW STATEMENT
for the Year ended 31st December, 2001
2001 2000
Notes £'000 £'000
Cashflow from operating activities
Investment income received 92 55
Interest received 464 370
Rental income received 2,742 3,113
Other cash payments/(receipts) (656) 3,456
Net cash inflow from operating activities 1 2,642 6,994
Returns on investment and servicing of finance
Interest paid on 2.5% Secured
Redeemable Loan Stock, 2001 (177) (152)
Interest paid on property loans (1,246) (1,061)
Net cash outflow from Investments
and servicing of finance (1,423) (1,213)
Capital expenditure and financial investment
Sale/(purchase) of tangible fixed assets 63 (32)
Purchase of investments (6,244) (1,814)
Sales of investments 2,426 5,810
Net loans repaid/(advanced) 192 (435)
Purchase of investment properties (1,477) (686)
Government grants received 245 -
Sale of investment properties 560 -
Purchase of developments in hand (46) (1,706)
Net cash inflow/(outflow) from capital
expenditure and financial investment (4,281) 1,137
Corporation tax paid - -
Equity dividends paid (64) (42)
Cash outflow/(inflow) before use of liquid resources
and financing (3,126) 6,876
Management of liquid resources
Acquisition/(sale) of listed securities held for dealing (181) 180
Financing
Repayment of loans (6,367) (2,823)
Receipt of loans 3,662 -
Share capital issued as a result of the exercise of options 19 13
Net cash outflow from financing (2,686) (2,810)
(Decrease)/increase in cash 3 (5,993) 4,246
RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS
2001 2000
£'000 £'000
Issue of ordinary shares at par 19 13
Retained profit for the year 2,066 5,126
Revaluation surplus 235 -
Net movement on capital reserves (2,270) 10,047
50 15,186
Shareholders' funds at 1st January 24,070 8,884
Shareholders' funds at 31st December 24,120 24,070
GRESHAM HOUSE plc
PRELIMINARY FINAL STATEMENT
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
for the Year ended 31st December, 2001
1 Reconciliation of operating profit to operating cash flows.
2001 2000
£'000 £'000
Return on ordinary activities
before taxation 2,202 5,196
Interest payable 1,277 1,513
3,479 6,709
Depreciation 17 32
Discount on acquisition of loan issued by group undertaking - (525)
Loan provision written back (130) -
Adjustment on disposal of subsidiary (24) -
Corporation tax adjustment - (6)
Increase in debtors (103) (31)
(Decrease)/increase in creditors (597) 815
Net cash flow from operating activities 2,642 6,994
2 Reconciliation of net cash flow to movement in net debt
(Decrease)/increase in cash for the year (6,083) 4,246
Cash outflow from repayment of debt 6,457 2,823
Cash inflow from loans received (3,662) -
Cash outflow/(inflow) from increase/(decrease)
in liquid resources 181 (180)
Change in net debt resulting from cash flows (3,107) 6,889
Discount on acquisition of loan issued by a group undertaking - 525
Movement in net debt in the year (3,107) 7,414
Net debt at beginning of year (13,946) (21,360)
Balance at end of year (17,053) (13,946)
3 Analysis of net debt
At 1st Cash Other At 31st
January flow non-cash December
2001 changes 2001
£'000 £'000 £'000 £'000
Cash in hand and at bank / brokers 8,807 (6,083) 2,724
Overdrafts (90) 90 -
(5,993)
Debt due within one year (6,970) 6,367 (813) (1,416)
Debt due after one year (15,822) (3,662) 813 (18,671)
(3,288)
Current asset investments 129 181 310
(13,946) (3,107) - (17,053)
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