Final Results

Smart(J.)&Co(Contractors) PLC 05 November 2007 J SMART & CO (CONTRACTORS) PLC AND SUBSIDIARY COMPANIES ACCOUNTS FOR THE YEAR ENDED 31st JULY 2007 PRELIMINARY STATEMENT ACCOUNTS As forecast in the last annual report, group profits for the year before tax were less than last year turning out at £8,144,000 which compares with the figure for last year of £13,760,000. Both of these figures include unrealised gains in revalued property as required by the International Financial Reporting Standards. If the impact of revalued property on the figures is disregarded then a truer reflection of Group Performance emerges in the form of £6,200,000 profit before tax (including £2,129,000 profit from property sales) for the year under review which would compare with a figure for the previous year of £7,005,000 (including £899,000 profit from property sales). The Board is recommending a Final Dividend of 10.15p nett making a total for the year of 13.15p nett which compares with 12.80p nett for the previous year. After waivers by members holding approximately 51% of the shares, the Dividends will cost the Company £648,000. Profit adjusted for pension scheme deficit, dividends paid and fair value reserve when added to opening shareholders' funds brings the total equity of the Group to £92,135,000. TRADING ACTIVITIES Group turnover decreased by 24%, own work capitalised increased substantially and other operating income decreased by 14%. Total Group profits decreased by 41%. Underlying Group profits excluding unrealised gains in revalued property decreased by 11%. Turnover and profits in contracting decreased. Private housing sales declined once more. Sales in precast concrete manufacture increased slightly and a small profit was made. We completed the second large speculative Industrial Unit at Cardonald Business Park, Glasgow and the large pre-let Industrial Unit in Helen Street, Glasgow just after the year end. Helen Street is now occupied. The mixed commercial and residential development in McDonald Road, Edinburgh is proceeding. The refurbishment of our large office development in Links Place, Edinburgh is complete and attracting steady interest. A1 Industrial Estate, Edinburgh (four phases) and Starlaw Industrial Estate, Livingston (three phases), both joint ventures with EDI (Industrial) Limited, were completed and sold during the year under review. FUTURE PROSPECTS Bearing in mind property disposals, rental income is expected to decrease. We have commenced the second and final phase of our joint venture with Walker Group at Prestonfield Park, Edinburgh, comprising five industrial units, three of which are pre-let. Our residential joint venture with Keane Developments Limited at Duff Street, Edinburgh is well underway. Advance sales figures are promising. The amount of contract work in hand is more than at this time last year. The majority of this work has been obtained on a negotiated and/or design and construct basis and the balance by traditional competitive tender. Private house sales are not expected to be significant. Bearing in mind the impact on the Income Statement of including unrealised gains /losses in revalued property, it is not possible at this stage to forecast the current year's results with any accuracy. J. M. SMART Chairman CONSOLIDATED INCOME STATEMENT for the year ended 31st JULY 2007 2007 2006 £000 £000 Revenue 19,977 26,149 Own work capitalised 4,579 98 ________ ________ 24,556 26,247 Cost of sales (21,464) (21,378) ________ ________ Gross Profit 3,092 4,869 Other operating income 5,024 5,819 Net operating expenses (5,033) (5,307) ________ ________ Operating Profit before profits on sale and net revaluation gains on investment properties 3,083 5,381 Profit arising on sale of investment properties 627 899 Net gain on valuation of investment properties 1,944 5,546 ________ ________ Operating Profit 5,654 11,826 Share of profits in Joint Ventures 1,800 1,651 Income from investments 63 84 Profit/(Loss) on sale of investments 95 (40) Finance income 851 382 Finance costs (319) (143) ________ ________ Profit before tax 8,144 13,760 Taxation (1,412) (3,131) ________ ________ Profit attributable to equity shareholders 6,732 10,629 ________ ________ Earnings per share - Basic and Diluted 66.77p 105.43p ________ ________ CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE for the year ended 31st JULY 2007 2007 2006 £000 £000 Actuarial gain/(loss) recognised on defined benefit pension scheme 2,755 (1,538) Deferred taxation on actuarial (gain)/loss (826) 461 ________ ________ Net gain/(deficit) recognised directly in equity 1,929 (1,077) Profit for period 6,732 10,629 ________ ________ Total recognised income and expense for the period 8,661 9,552 ________ ________ Attributable to equity shareholders 8,661 9,552 ________ ________ STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY Share Fair Value Retained Capital Reserve Earnings Total £000 £000 £000 £000 As at 1st August 2005 1,008 296 73,662 74,966 Total recognised Income and Expense - - 9,552 9,552 Fair value adjustment net of tax - 177 - 177 Dividends - - (615) (615) ________ ________ ________ ________ As at 31st July 2006 1,008 473 82,599 84,080 ________ ________ ________ ________ Transfer between reserves - (125) 125 - Total recognised Income and Expense - - 8,661 8,661 Fair value adjustment net of tax - 24 - 24 Dividends - - (630) (630) ________ ________ ________ ________ As at 31st July 2007 1,008 372 90,755 92,135 ________ ________ ________ _______ CONSOLIDATED BALANCE SHEET as at 31st JULY 2007 2007 2006 £000 £000 Non-current assets Property, plant and equipment 2,537 2,566 Investment properties 72,545 77,436 Investments in Joint Ventures 1,996 4,604 Financial assets 1,695 1,499 Other receivables 2,176 2,796 Deferred tax asset 1,641 2,531 ________ ________ 82,590 91,432 ________ ________ Current assets Inventories 7,635 2,305 Trade and other receivables 3,700 2,704 Cash and bank 16,468 10,251 ________ ________ 27,803 15,260 ________ ________ Total Assets 110,393 106,692 ________ ________ Non-current liabilities Retirement benefit obligations 5,280 8,201 Deferred tax liabilities 7,843 9,734 ________ ________ 13,123 17,935 ________ ________ Current liabilities Trade and other payables 4,265 3,331 Current tax liabilities 870 1,346 ________ ________ 5,135 4,677 ________ ________ Total Liabilities 18,258 22,612 ________ ________ Net Assets 92,135 84,080 ________ ________ Equity Called up share capital 1,008 1,008 Fair value reserve 372 473 Retained Earnings 90,755 82,599 ________ ________ 92,135 84,080 ________ ________ CONSOLIDATED CASH FLOW STATEMENT year ended 31st JULY 2007 2007 2006 £000 £000 Profit before tax 8,144 13,760 Share of profits from Joint Ventures (1,800) (1,651) Depreciation 483 488 Unrealised revaluation gains on investment properties (1,944) (5,546) Gain on sale of property, plant and equip (68) (14) Gain on sale of investment properties (627) (899) (Profit)/loss on sale of financial asset (95) 40 Change in retirement benefits (166) (365) Interest received (740) (353) Interest received by Joint Ventures (111) (7) Interest paid - 1 Interest paid by Joint Ventures 150 142 Change in inventories (5,330) 1,619 Change in receivables - current (376) 62 Change in receivables - non current - (1,140) Change in payables 935 (586) ________ ________ (1,545) 5,551 Tax paid on profits (2,346) (1,520) ________ ________ Net cash flow from operating activities (3,891) 4,031 ________ ________ Cash flows from investing activities Purchase of property, plant and equipment (465) (662) Purchase of investment properties (6) (27) Expenditure on own work capitalised (4,579) (98) Sale of property, plant and equipment 79 50 Sale of investment properties 12,046 5,119 Purchase of financial assets (282) (369) Proceeds of sale of financial assets 205 456 Interest received 740 353 Interest paid - (1) Dividend received from Joint Venture 3,000 - ________ ________ Net cash from investing activities 10,738 4,821 ________ ________ Cash flows from financing activities Dividends paid (630) (615) ________ ________ Net cash used in financing activities (630) (615) ________ ________ Increase in cash, cash equivalents and bank 6,217 8,237 ________ ________ Cash, cash equivalents and bank at beginning of period 10,251 2,014 ________ ________ Cash, cash equivalents and bank at end of period 16,468 10,251 ________ ________ NOTES TO THE PRELIMINARY STATEMENT 1. Basis of Preparation This preliminary statement is an abridged version of the Company's full consolidated accounts, which have not yet been filed with the Registrar of Companies and have not yet been reported on by the Company's auditors. The financial information included in this preliminary statement does not include all of the disclosures required by International Financial Reporting Standards (IFRS) or the Companies Act 1985 and accordingly does not itself comply with IFRS or the Companies Act 1985. The company prepares its annual consolidated financial statements in accordance with IFRS and its interpretations issued by the International Accounting Standards Board as adopted by the European Union. There are no differences in the accounting policies applied in the preparation of the consolidated financial statements for the year to 31st July 2007 and the financial information included in this preliminary statement and the accounting policies disclosed in the 2006 Annual Report and Statement of Accounts. The consolidated financial statements are prepared under the historical cost convention with the exception of financial assets which are recognised at fair value. The financial information for the year to 31st July 2006 is derived from the statutory accounts for that year which were submitted to the Registrar of Companies and upon which the Company's auditor provided an unqualified audit report and which did not contain a statement under S237 the of Companies Act 1985. 2. Dividends 2007 2006 £000 £000 Ordinary dividends 2007 Interim dividend of 3.00p per share 147 - 2006 Final dividend of 9.80p per share 483 - 2006 Interim dividend of 3.00p per share - 147 2005 Final dividend of 9.50p per share - 468 ________ ________ 630 615 ________ ________ The Company is proposing a final dividend of 10.15p per share for the year to 31st July 2007 which after waivers by members holding approximately 51% of the shares will cost the Company £500,000. The dividend if approved will be paid on 24th December 2007 to shareholders on the Register at the close of business on 7th December 2007. This information is provided by RNS The company news service from the London Stock Exchange

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