Interim Results

Wynnstay Properties PLC 25 November 2003 WYNNSTAY PROPERTIES PLC 25 November 2003 CHAIRMAN'S STATEMENT Shareholders will recall that in my annual statement I cautioned that emulating last year's record performance would be challenging. It is very pleasing to report, therefore, that profit before property disposals and taxation for the first half of the present financial year actually showed a modest increase from £316,000 to £322,000. However, last year's interim pre-tax results included a surplus of £101,000 on the disposal of an investment property, whereas in the half year now under review no such disposals were made. The results may be summarised as follows:- 2003 2002 Profit before property disposals and taxation +1.9% £322,000 £316,000 Profit before taxation: -22.8% £322,000 £417,000 Profit after taxation: -27.4% £225,000 £310,000 Interim dividend per share: +4.8% 2.2p 2.1p Net asset value per share: +16.6% 302p 259p The portfolio remained fully let and income producing, with the small decline in rental income reflecting the property disposal last year. However, with the significant addition to the portfolio to which I refer below, and with further rent reviews falling due in the second half of the year, I expect satisfactory growth in rental income for the full year. Property outgoings, together with administration and other costs remained under tight control. Net finance costs were again lower reflecting reduced borrowings, coupled with lower interest rates throughout the period. In the light of these results, the Directors have decided to increase the interim dividend by 4.8% from 2.1p per share to 2.2p per share. This will be paid on 18th December 2003 to Shareholders on the register on 5th December 2003. Retained profits of £156,000 have contributed to net asset value increasing to 302p per share compared with 259p per share at the same time last year. On 14th October 2003, we announced the acquisition of the Oakcroft Business Centre in Chessington, Surrey for £1.9 million and the transaction, which was funded from our existing bank facilities, was completed on 10th November 2003. This freehold property comprises three 2-storey modern units, totaling just over 15,000 square feet including open plan office accommodation, surrounding a secure central courtyard car parking area. The units are fully let on leases expiring between March 2011 and February 2013, currently producing an income of £150,568 per annum, equivalent to a yield, after costs, of approximately 7.5% per annum. Located about three miles south of Kingston-upon-Thames, the property is conveniently positioned for access to the A3 primary trunk road and M25 motorway as well as to Heathrow and Gatwick airports. The Board believes this substantial acquisition marks a further important stage in the enhancement of Wynnstay's portfolio. It has become clear in recent weeks that the present interest rate cycle has turned, with rates beginning to rise again from their 48-year historic low. However, it seems common ground amongst economists and analysts that, whilst rates are likely to rise again in several steps over the next year, there is no sign at present that we will return to the high rates experienced during the 1980's and early 1990's. Interest rates on our variable rate borrowings, currently £3.5 million, have been fixed until April 2004 and on the fixed rate borrowings of £4.0 million until June 2006. The Company's strongly positive cash flow, coupled with growth in net asset value of 43% over the previous four financial years is reflected in the decrease in net gearing to the modest level of 56% at the half year end. This provides us with a platform to finance and make further selective acquisitions, where we believe that these will increase Shareholder value in the medium to longer term. We will also continue to keep under review opportunities to sell properties in the portfolio where future growth in value or income appears limited and realised surpluses on disposals can be reinvested in new acquisitions. It is pleasing to note the significant rise in Wynnstay's share price over recent months, which has considerably narrowed the discount to the underlying net asset value. It has also been encouraging of late to see a number of new Shareholders appearing on the Company's register to whom I extend a warm welcome as well as thanking those existing Shareholders who have demonstrated their confidence by adding to their investments in Wynnstay. Our Annual General Meeting in the summer was attended by a record number of Shareholders and produced an interesting dialogue during the question and answer session which covered a broad range of subjects concerning the Company's affairs. May I remind Shareholders that next year's meeting will be held on Thursday 22nd July 2004 at the Royal Automobile Club, Pall Mall, London SW1. Finally, on behalf of the Board, I send all Wynnstay's Shareholders and their families our best wishes for a peaceful and happy Christmas and for the New Year. Philip G.H. Collins 25th November 2003 Chairman UNAUDITED CONSOLIDATED PROFIT & LOSS ACCOUNT FOR THE SIX MONTHS ENDED 29TH SEPTEMBER 2003 Six Months ended 29th September Year ended 25th March 2003 2002 2003 (Unaudited) (Audited) £'000 £'000 £'000 Turnover Gross Rental Income 748 762 1,504 Fees and Commissions 10 10 18 ------ ------ ------ 758 772 1,522 Property Outgoings (31) (34) (63) ------ ------ ------ 727 738 1,459 Administration and Other Costs (234) (229) (452) ------ ------ ------ Operating Profit 493 509 1,007 Profit on Disposal of Investment Properties - 101 101 ------ ------ ------ 493 610 1,108 Finance Costs (Net) (171) (193) (353) ------ ------ ------ Profit on Ordinary Activities before Taxation 322 417 755 Taxation (97) (107) (171) ------ ------ ------ Profit on Ordinary Activities after Taxation 225 310 584 Interim Dividend 2003: 2.2p per share, 2002: 2.1p per share (69) (66) Total Dividend 2002-2003: 7.2p per share (227) ------ ------ ------ Profit Retained 156 244 357 ------ ------ ------ Basic Earnings per share (see note below) 7.1p 9.8p 18.5p Note Basic earnings per share have been calculated on profits after taxation attributable to ordinary shareholders of £225,000 (2002: £310,000) and on 3,155,267 ordinary shares, being the weighted average number in issue during both periods. UNAUDITED CONSOLIDATED BALANCE SHEET AS AT 29TH SEPTEMBER 2003 29th September 25th March 2003 2002 2003 (Unaudited) (Audited) £'000 £'000 £'000 Fixed Assets Tangible Assets 15,514 14,410 15,517 Investments 1 56 1 ------ ------ ------ 15,515 14,466 15,518 Current Assets Debtors 86 89 69 Cash at Bank and in Hand 330 526 287 ------ ------ ------ 416 615 356 Creditors: Amounts falling due within one year (613) (684) (712) ------ ------ ------ Net Current Liabilities (197) (69) (356) ------ ------ ------ Total Assets Less Current Liabilities 15,318 14,397 15,162 Creditors: Amounts falling due after more than one year (5,700) (6,200) (5,700) ------ ------ ------ 9,618 8,197 9,462 Provision for Liabilities and Charges (86) (38) (86) ------ ------ ------ Net Assets 9,532 8,159 9,376 ------ ------ ------ Capital and Reserves Share Capital 789 789 789 Capital Redemption Reserve 205 205 205 Share Premium Account 1,135 1,135 1,135 Capital Reserve 151 151 151 Revaluation Reserve 3,797 2,742 3,797 Distributable Reserves 3,455 3,137 3,299 ------ ------ ------ Equity Shareholders' Funds 9,532 8,159 9,376 ------ ------ ------ UNAUDITED CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS ENDED 29TH SEPTEMBER 2003 Six Months ended 29th September Year ended 25th March 2003 2002 2003 (Unaudited) (Audited) £'000 £'000 £'000 Cash Flow from Operating Activities (Note 1) 422 523 1,081 ------ ------ ------ Returns on Investment and Servicing of Finance Interest Received 4 4 7 Interest Paid (170) (158) (374) ------ ------ ------ Net Cash (Outflow) from Returns on Investment and Servicing of Finance (166) (154) (367) ------ ------ ------ Taxation Paid (52) (61) (144) ------ ------ ------ Capital Expenditure and Financial Investment Purchase of Tangible Fixed Assets - (1) (1) Disposal of Tangible Fixed Assets - 266 266 Sinking Fund Policy Redemption - - 65 ------ ------ ------ Net Cash Inflow from Investing Activities - 265 330 ------ ------ ------ Equity Dividends Paid (161) (150) (216) ------ ------ ------ Net Cash Inflow before Financing 43 423 684 Financing Repayment of Bank Loan - (250) (750) ------ ------ ------ Increase/(Decrease) in Cash in the Period 43 173 (66) ------ ------ ------ Reconciliation of Net Cash Flow to Movement in Net Debt Increase/(Decrease) in Cash in the Period 43 173 (66) Cash Inflow from Debt Financing - 250 750 ------ ------ ------ Movement in Net Debt in the Period 43 423 684 Net Debt at 25th March 2003 (5,413) (6,097) (6,097) ------ ------ ------ Net Debt at 29th September 2003 (Note 2) (5,370) (5,674) (5,413) ------ ------ ------ Notes To Cash Flow Statement 1. Reconciliation of Operating Profit to Net Cash Inflow from Operating Activities Six Months ended Year ended 25th 29th September March 2003 2002 2003 £'000 £'000 £'000 Operating Profit 493 508 1,007 Depreciation and Amortisation 3 3 7 (Increase)/Decrease in Debtors (16) 14 32 (Decrease)/Increase in Creditors (58) (2) 35 ------ ------ ------ Net Cash Inflow from Operating Activities 422 523 1,081 ------ ------ ------ 2. Analysis of Net Debt 29th September Cash Movement 25th March 2003 2003 £'000 £'000 £'000 Cash at Bank and in Hand 330 43 287 Debt due after more than one year (5,700) - (5,700) ------ ------ ------ Net Debt (5,370) 43 (5,413) ------ ------ ------ Notes 1. The figures in these statements do not constitute statutory accounts; those for the year ended 25th March 2003 are extracted from the Group Accounts which have been filed with the Registrar of Companies and which received an unqualified report from the Auditors and did not contain a statement under Section 237(2) or (3) of the Companies Act 1985 as amended. 2. The interim dividend of 2.2p per share will be paid on 18th December 2003 to those Shareholders on the register at 5th December 2003. 3. This interim report is being posted to all Shareholders and will be available on application to the Company's registered office at Cleary Court, 21 St. Swithin's Lane, London EC4N 8AD. This information is provided by RNS The company news service from the London Stock Exchange

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