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Caledonian Trust PLC (CNN)

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Wednesday 28 March, 2007

Caledonian Trust PLC

Interim Results

Caledonian Trust PLC
28 March 2007

For immediate release
                                               28 March 2007



                             Caledonian Trust plc
                      ('Caledonian Trust' or the 'Group')

           Interim results for the six months ended 31 December 2006


                              CHAIRMAN'S STATEMENT


The Group made a pre-tax loss of £399,000 in the six months to 31 December 2006
compared with a profit of £155,125 for the same period last year. Losses per
share were 3.35p and NAV per share was 219.2p compared to earnings and NAVs of
1.09p and 222.5p and 1.31p and 205.3p at 30 June 2006 and 31 December 2005
respectively. There were no property sales in the six months to 31 December
2006, but rental income increased by £92,000. Continuing investment in
development properties resulted in increases of £263,000 in net interest payable
and most of the £69,000 increase in administration costs. An unchanged interim
dividend of 1.0p will be paid.


The Group's current major strategy continues to be the acquisition and creation
of development opportunities, particularly those with a reasonable probability
of achieving high returns and a small probability of a nil or, at worst, a
negative return. Since June 2006 we have acquired four such development
opportunities, three of which are rural properties. These acquisitions comprise
a further four-acre development site near Dunbar; a two-acre site in Lochdon,
Mull; a 1.5ha steading site in Fife, a few miles from St Andrews; and a farm
near Kinross comprising a farmhouse, 257 acres of land, mostly arable, and a
large steading with buildings extending to 27,580ft2. The Group now owns twelve
rural development opportunities, and has two further large rural properties
under offer.


Several planning consents have been gained, others have been submitted and more
are being prepared. Near Dunbar our four-acre site gained permission for 24
detached houses and four affordable houses. At Wallyford in August 2006, five
years after submission, we eventually gained consent for eight detached houses
and at Brunstane, in east Edinburgh, we obtained an improved consent for ten
houses over 14,000ft2, including some 'new build', in the charming Georgian
steading. At Ardpatrick, Argyll, we have obtained consents to convert and extend
a bothy for residential use, to enlarge the gate lodge by 100% and to divide the
mansion house into four individual properties ranging from 1760ft2 to 3478ft2.
Application has been made for four new or converted additional houses in or
around the walled garden. Sites for several other new houses in the rural
development area are under discussion. Planning applications have been made for
ten houses at Balnaguard, Perthshire and for a large steading development of
fifteen houses at Ardonachie near Bankfoot, Perthshire. Other applications will
be made this year. Our joint development of 39 small detached and semi-detached
houses at Herne Bay continues successfully with only three houses remaining
unsold.



There are few changes to our investment portfolio. The leases of our two
properties in Young Street, Edinburgh adjacent to Charlotte Square, determined
on 28 August 2006. 17 Young Street, the smaller of the two properties, together
with its two garages has been re-let to the former tenants at a slightly
enhanced rent. We have re-let the garages associated with 19 Young Street and,
after agreeing a satisfactory dilapidations settlement, have marketed the
property for sale un-refurbished. Planning permission has been obtained to
reconvert the ground and 1st floor of 61 North Castle Street to residential use
and warrant should be obtained to incorporate the Edwardian extension at the
rear of 61 North Castle Street into the existing office space in Hill Street.



UK economic prospects appear propitious. GDP growth in 2006 increased to 2.6%
from 1.9% in 2005 and is forecast to be 2.7% in 2007 by the Economist Poll of
Forecasters and between 2.5% and 3.0% in 2008 according to the Budget Statement.
The major domestic risk to the economy is of long-term inflationary trends
resulting in further increases in interest rates and the consequent damaging
effects on house prices and on consumption. Fortunately the CPI has fallen from
a high of 3.0%, the upper prescribed limit, but the RPI, often used in wage
comparisons, has risen to 4.6%. Most commentators expect the CPI to fall rapidly
within the next two months, and to only 1.6% by 2008, as the rise in energy
costs that occurred last year drops out of the comparison and as gas prices
fall. However it is the MPC's projection of future inflation that determines
policy: 3 month LIBOR rates indicate, and the Royal Bank of Scotland predict, a
further 0.25% point increase before interest rates fall back.



The recent increases in interest rates do not appear to have significantly
affected house prices. The FT House Price Index has risen 6.9% in the year to
January 2007, a monthly change of 0.7%, broadly similar to the second half of
2006 but up from 3.7% in January 2006. The Nationwide and Halifax report rises
of 9.3% and 9.6% respectively. The Lloyds TSB Scotland Price Index rose by 11.0%
in 2006 following increases of 13.3% in 2005 and 18.8% in 2004. Lloyds say
'increases continue at a robust pace propelled by a favourable economic
background and demand for houses exceeding supply'. Given the favourable
economic outlook, including stable interest rates, the housing market continues
to be attractive, especially in Scotland.



I reported last year that the Group prospects for profit and for asset growth
continue to be asymmetrical: rental income is less than administrative expenses
and net interest payable, and profits are determined by relatively volatile
asset sales. The Group reported no property sales in the last six months but
during the balance of the current year asset and development sales, together
with other income, should be sufficient to fund the ongoing investment in
development properties. Larger more profitable projects should commence next
year which will materially improve the Group's profitability as they mature and
the Group now has a 'production line' of developments which should help maintain
future profitability. Alternatively, the Group has the option to realise
development sites, many of which are carried as stock at values far below market
value. Almost all our development properties are unencumbered and will provide
excellent collateral for any development. In addition to building our physical
assets the Group has established excellent relationships with its professional
advisors who form a cohesive team in evaluating and promoting the Group's
development interests. John Little and Bryan Rankin retired as non-executive
directors at the AGM and I would like to thank them for their significant
contribution to the Group. I welcome Roddy Pearson, a wise and experienced
surveyor who has advised the Group formally and informally over many years to
the Board. Roddy joins us as a non-executive director as we start to exploit the
many development opportunities now available.



I D Lowe
Chairman
                                                       28 March 2007



For further information please contact:

Douglas Lowe, Chairman and Chief Executive Officer   Tel: 0131 220 0416

Mike Baynham, Finance Director                        Tel: 0131 220 0416

Alasdair Robinson, Noble & Company Limited           Tel: 0131 225 9677


                                             Unaudited Consolidated Profit & Loss Account   
                                                for the six months to 31 December 2006

                                            6 Months to       6 Months Year to
                                            31 Dec            to 31 Dec         30 June
                                            2006               2005              2006
                                            (unaudited)       (unaudited)       (audited)
                                            £000             £'000              £'000
INCOME-continuing operations
Rental Income                               477               385               871
Trading property sales                      -                 -                 410
Other trading sales                         31                61                108
                                            508               446               1389

OPERATING COSTS
Cost of trading property sales              -                 -                 (305)
Cost of other sales                         (45)              (61)              (113)
Administrative Expenses                     (578)             (509)             (993)
                                            (623)             (570)             (1411)
 
OPERATING PROFIT/(LOSS)                     (115)            (124)             (22)
Profit on disposal of investment property   -                 300               190
Profit on disposal of investment            -                 -                 -
Interest receivable                         37                125               275
Interest payable                            (321)             (146)           (319)

PROFIT/LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION                             (399)            155               124
Taxation                                    -                 -                 5     

PROFIT/LOSS ON ORDINARY ACTIVITIES
AFTER TAXATION                             (399)            155               129


Earnings per ordinary share                (3.35p)           1.31p             1.09p

Diluted earnings per ordinary share        (3.35p)           1.31p             1.09p


                                             Unaudited Consolidated Balance Sheet
                                                    as at 31 December 2006

                                            As at 31          As at 31           As at 30
                                            Dec 2006           Dec 2005          June 2006
                                            (unaudited )      (unaudited)       (audited)
 
                                            £'000             £'000             £'000
Fixed assets
Investment Properties                       24,057            24,487            24,031
Investments                                 43                -                 43
Equipment & vehicles                        27                4                 21       
                                            24,127            24,491            24,095
Current assets
Stock of development property               8,965             -                 7,034
Debtors                                     756               1,044             968
Cash at bank and in hand                    1,316             3,579             2,204
                                            11,037            4,623             10,206
Creditors: Amounts falling due within
one year                                    (2,119)           (3,594)           (2,177)

Net current assets                          8,918             1,029             8,029
 
Total assets less current liabilities       33,045            25,520            32,124
 
Creditors: Amounts falling due after
more than one year                          (7,000)           (1,006)           (5,680)

 
Net assets                                  26,045            24,514            26,444
 
Capital and reserves
Called up share capital                     2,377             2,377             2,377
Share premium account                       2,745             2,745             2,745
Capital redemption reserve                  175               175               175
Revaluation reserve                         6,625             4,551             6,625
Profit and loss account                     14,123            14,666            14,522
 
Shareholders' funds equity                  26,045           24,514             26,444


                                                                   
                                              Unaudited Consolidated Cash Flow Statement
                                               for the six months to 31 December 2006

                                            6 Months to       6 Months to       Year  to
                                            31 Dec 2006       31 Dec 2005       30 June 2006
                                            (unaudited)       (unaudited)       (audited)
                                            £'000             £'000               £'000
Net cash inflow/(outflow) from
operating activities                        (1,854)           218               (5,695)
Returns on investments and
servicing of finance                        (337)             (34)              (35)
Equity dividends paid                       -                 (178)             (297)
Capital expenditure and financial
investment                                  (31)              (1,142)           6
Tax paid                                    -                 -                 (29)    

Cash inflow/(outflow) before management
of liquid resources and financing           (2,222)           (1,136)           (6,050)
 
Financing                                   1,334             (42)              3,572
 

Decrease in cash in period                  (888)            (1,178)            (2,478)

Reconciliation of net cash flow to
movement in net funds

Decrease in cash in the period              (888)             (1,178)           (2,478)
 
Cash (outflow)/inflow from
movement in debt                            (1,334)          (42)               (3,572)
 
Movement in net funds in the period         (2,222)          (1,220)           (6,050)

Net (debt)/funds at the start of the period (5,172)           878               878
 
Net (debt)/funds at the end of the period   (7,394)           (342)             (5,172)

Notes to the unaudited consolidated cash flow statement

(a)Reconciliation of operating profit to net cash flow from operating activities
 


                                            6 Months to       6 Months to       Year to
                                            31 Dec 2006       31 Dec 2005       30 June 2006
                                            (unaudited)       (unaudited)       (audited)
                                            £'000             £'000                 £'000
Operating (loss)/profit                     (115)             (124)             (22)
Depreciation                                -                 -                 5
(Increase)/decrease in debtors              212               (25)              50
Increase/(decrease) in creditors            (21)              367               97
(Increase)/decrease in stock                (1,930)           -                 (5,825)
 
Net cash inflow/(outflow) from
operating activities                        (1,854)           218               (5,695)


(b)Analysis of cash flows

Returns on investment and
Servicing of Finance
Interest received                           37                125               275
Interest paid                               (374)             (159)             (310)
                                            (337)             (34)              (35)
 
Capital expenditure and
financial investment
Purchase of tangible fixed assets           (5)               (1)               (866)
Purchase of investment property             (26)              (2,070)           915
Sale of investment property                 -                 929               -
Purchase of investments                     -                 -                 (43)
                                            (31)              (1,142)           6       
 
Financing
Debt due within one year
Increase/(decrease) in short term debt      (14)              (338)             (3,969)
Debt due beyond one year
Increase(Decrease) in long-term debt        (1,320)           296               397
                                            1,334             (42)              (3,572)




                                       Unaudited Statement of Total Recognised Gains and Losses
                                                for the six months to 31 December 2006

                                            6 Months to       6 Months to       Year to
                                            31 Dec  2006      31 Dec  2005      30 June 2006
                                            (unaudited)       (unaudited)       (audited)
                                            £'000             £'000             £'000
Profit/(Loss) for period                    (399)             155               129
Unrealised surplus on revaluation
of properties                               -                 -                 1,979
Prior year adjustment                       -                 -                 178
Total gains and losses recognised
relating to the period                      (399)             155               2,286



Notes

1    The figures for the six months to 31 December 2006 and 31 December 2005 do 
not constitute the company's statutory accounts within the meaning of Section 
240 of the Companies Act 1985 (as amended) and are unaudited.  The figures for 
the year to 30 June 2006 do not constitute full accounts. The audited accounts 
for that year were unqualified and have been delivered to the Registrar of 
Companies.

2    The interim statement has been prepared in accordance with the accounting 
policies set out in the group's statutory accounts for the year ended 30 June 
2006.


3    The calculation of earnings per ordinary share is based on the
reported loss for the six months to 31 December 2006 and on the weighted average
number of ordinary shares in issue in the period, being 11,882,923.


4    An interim dividend of 1p per share will be paid on 4 May 2007 to
shareholders on the register on 10 April 2007.

5    Copies of the Interim Results for the six months to 31 December 2006 will 
be posted to shareholders shortly and will be available, free of charge, from 
the company's Nominated Adviser, Noble & Company Limited, 76 George Street, 
Edinburgh, EH2 3BU, for a period of one month from the date thereof.






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