Final Results

RNS Number : 6137V

Smart(J.)&Co(Contractors) PLC

04 November 2010

 



J SMART & CO (CONTRACTORS) PLC AND SUBSIDIARY COMPANIES

ACCOUNTS FOR THE YEAR ENDED 31st JULY 2010

PRELIMINARY STATEMENT

ACCOUNTS

Headline group profits for the year before tax, including an unrealised deficit in revalued property, as required by the International Financial Reporting Standards turned out at £3,984,000.  This compares with a loss for last year of £1,208,000 which included a substantial unrealised deficit in revalued property.  If the impact of revalued property on the figures is disregarded then a truer reflection of Group Performance emerges in the form of an underlying profit before tax of £4,588,000 for the year under review which compares with the corresponding figure for underlying profit last year of £4,468,000.

The value of investment properties at the beginning of the year was £71,078,000 (cost £44,161,000).  Additions during the year cost £4,086,000.  The net deficit on the year end valuation was £604,000 leaving a value of £74,560,000 (cost £48,247,000).

The Board is recommending a Final Dividend of 9.60p nett making a total for the year of 14.10p nett, which compares with 13.85p nett for the previous year.  The dividend will cost the Company £968,000.

Profit adjusted for pension scheme deficit, dividends paid and fair value reserve when deducted from opening shareholders' funds brings the total equity of the Group to £96,541,000.

TRADING ACTIVITIES

Group construction work carried out and share of Joint Ventures' turnover decreased by 20%, own work capitalised decreased by 34% and other operating income decreased by 1%.  Group revenue decreased by 17% and this year's total Group profit of £3,984,000 compares with last year's total Group loss of £1,208,000.  Underlying Group profit excluding an unrealised deficit in revalued property increased by 3%

As expected, turnover in contracting was lower, however a profit was achieved.  A slow but steady progress in private house sales stalled after Easter.  Sales in precast concrete manufacture fell again and an increased loss was incurred.

The office development in McDonald Road, Edinburgh completed after the year end is unlet.  The second phase of our industrial development at Bilston Glen near Edinburgh is 25% let.  Our small speculative office development in Perth is proceeding to programme.  An early letting interest here has lapsed.

FUTURE PROSPECTS

The outlook in all sectors of our activities is uncertain.  Nevertheless tenant departures from our existing commercial and industrial space are being replaced.  The take up in new space is, however, disappointing, most initial interest having evaporated.  Rental income for the current year is expected to approximate to last year's figure.

There is no sign at present of private house sales picking up again.  Alternative strategies are being considered.

Although the rundown in contracting turnover has forced us to initiate a substantial redundancy programme, recent orders mean the work in hand in contracting is similar to this time last year.

With the recession still in full flow too many uncertainties exist to make even an approximate assessment of the outcome for the current financial year, however it is probable that underlying profits will be lower than last year.

	J.M. SMART
	Chairman

CONSOLIDATED INCOME STATEMENT for the year ended 31st JULY 2010

		2010		2009
		£000		£000
Group construction work carried out and share of Joint Ventures' turnover		23,690		29,616
Less: Share of Joint Ventures' turnover		-		(165)
Less: Own construction work capitalised		(2,668)		(4,050)
Revenue		21,022		25,401
Cost of sales		(16,662)		(21,707)
Gross Profit		4,360		3,694
Other operating income		5,521		5,568
Net operating expenses		(5,490)		(5,230)
Operating Profit before net revaluation deficit on investment properties		4,391		4,032
Net deficit on valuation of investment properties		(604)		(5,779)
Operating Profit/(Loss)		3,787		(1,747)
Share of profits in Joint Ventures		201		217
Income from available for sale financial assets		89		66
Profit/(loss) on sale of available for sale financial assets		95		(55)
Impairment of available for sale financial assets		-		(365)
Finance income		120		677
Finance costs		(308)		(1)
Profit/(Loss) before tax		3,984		(1,208)
Taxation		(250)		50
Profit/(Loss) attributable to equity shareholders		3,734		(1,158)
Earnings/(Loss) per share - Basic and Diluted		37.04p		(11.49)p

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 31st JULY 2010

		2010		2009
		£000		£000
Actuarial gain/(loss) recognised on defined benefit pension scheme		2,489		(4,553)
Deferred taxation on actuarial (gain)/loss		(767)		1,275
Net surplus/(deficit) recognised directly in equity		1,722		(3,278)
Profit/(loss) for year		3,734		(1,158)
Total recognised income and expense for the year		5,456		(4,436)
Attributable to equity shareholders		5,456		(4,436)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

as at 31st July 2010

		Share		Fair  Value		Retained
		Capital		Reserve		Earnings		Total
		£000		£000		£000		£000
As at 1st August 2008		1,008		(127)		96,433		97,314
Total recognised Income and Expense		-		-		(4,436)		(4,436)
Fair value adjustment		-		(132)		-		(132)
Tax adjustment on fair value reserve		-		(65)		-		(65)
Impairment of available for sale financial assets taken to Income Statement		-		365		-		365
Dividends		-		-		(739)		(739)
As at 31st July 2009		1,008		41		91,258		92,307
Total recognised Income and Expense		-		-		5,456		5,456
Fair value adjustment		-		217		-		217
Tax adjustment on fair value reserve		-		(42)		-		(42)
Impairment of available for sale financial assets taken to Income Statement		-		-		-		-
Dividends		-		-		(1,397)		(1,397)
As at 31st July 2010		1,008		216		95,317		96,541

CONSOLIDATED STATEMENT OF FINANCIAL POSITION as at 31st JULY 2010

	2010		2009
	£000		£000
Non-current assets
Property, plant and equipment	1,391		6,715
Investment properties	74,560		65,946
Investments in Joint Ventures	1,635		2,284
Available for sale financial assets	2,604		1,914
Deferred tax asset	719		1,778
	80,909		78,637
Current assets
Inventories	7,324		8,476
Trade and other receivables	6,632		7,001
Current tax assets	26		-
Cash at bank and in hand	22,197		23,234
	36,179		38,711
Total Assets	117,088		117,348
Non-current liabilities
Retirement benefit obligations	1,344		4,468
Deferred tax liabilities	4,001		4,763
	5,345		9,231
Current liabilities
Trade and other payables	5,068		4,872
Current tax liabilities	-		163
Bank overdraft	10,134		10,775
	15,202		15,810
Total Liabilities	20,547		25,041
Net Assets	96,541		92,307
Equity
Called up share capital	1,008		1,008
Fair value reserve	216		41
Retained earnings	95,317		91,258
	96,541		92,307

CONSOLIDATED STATEMENT OF CASH FLOW for the year ended 31st JULY 2010

	2010		2009
	£000		£000
Profit/(loss) before tax	3,984		(1,208)
Share of profits from Joint Ventures	(201)		(217)
Depreciation	456		521
Unrealised revaluation deficit on investment properties	604		5,779
(Profit)/loss on sale of property, plant and equipment	(37)		41
(Profit)/loss on sale of available for sale financial assets	(95)		55
Impairment of available for sale financial assets	-		365
Change in retirement benefits	(635)		(1,174)
Interest received	(120)		(602)
Interest paid	-		1
Change in inventories	1,152		(292)
Change in receivables - current	369		8
Change in payables	195		(645)
	5,672		2,632
Tax paid on profits	(950)		(1,333)
Net cash flow to operating activities	4,722		1,299
Cash flows from investing activities
Purchase of property, plant and equipment	(304)		(493)
Purchase of investment properties	(1,418)		(2,044)
Sale of property, plant and equipment	77		64
Expenditure on own work capitalised - investment properties	(2,668)		(1,533)
Expenditure on own work capitalised - properties under construction	-		(2,517)
Purchase of available for sale financial assets	(597)		(580)
Proceeds of sale of available for sale financial assets	219		11
Interest received	120		602
Interest paid	-		(1)
Dividend from Joint Venture	850		-
Net cash used in investing activities	(3,721)		(6,491)
Cash flows from financing activities
Dividends paid	(1,397)		(739)
Net cash used in financing activities	(1,397)		(739)
Decrease in cash, cash equivalents and bank	(396)		(5,931)
Cash, cash equivalents and bank at beginning of period	12,459		18,390
Cash, cash equivalents and bank at end of period	12,063		12,459

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 2006 and accordingly does not itself comply with IFRS or the Companies Act 2006.

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 2010 and the financial information included in this preliminary statement and the accounting policies disclosed in the 2009 Annual Report and Statement of Accounts.

The consolidated financial statements are prepared under the historical cost convention with the exception of available for sale financial assets which are recognised at fair value.

The financial information for the year to 31st July 2009 is derived from the statutory accounts for that year which were submitted to the Registrar of Companies and upon which the Company's auditors provided an unqualified audit report and which did not contain a statement under S498 of the Companies Act 2006.

2.         Dividends

	2010		2009
	£000		£000
Ordinary dividends
2008 Final dividend of 10.50p per share	-		517
2009 Interim dividend of 4.50p per share	-		222
2009 Final dividend of 9.35p per share	943		-
2010 Interim dividend of 4.50p per share	454		-
	1,397		739

Certain shareholders holding approximately 51% of the shares have waived their rights to the final dividend paid for the year to 31st July 2008 and the interim dividend paid for the year to 31st July 2009.  There have been no subsequent waivers lodged.

The Company is proposing a final dividend of 9.60p per share for the year to 31st July 2010 which will cost the Company £968,000.  No shareholders are waiving their right to the final dividend.

The dividend if approved will be paid on 20th December 2010 to shareholders on the Register at the close of business on 3rd December 2010.

 

END

 

 

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