Interim Results - Balance Sheet Improvements
GRESHAM HOUSE PLC
21 October 1999
GRESHAM HOUSE plc
36 Elder Street, London E1 6BT
Telephone: 020-7588 7352
Facsimile: 020-7377 2946
CHAIRMAN'S INTERIM STATEMENT
Dear Shareholder,
The results for the half year ended 30th June, 1999, as set out in the
Unaudited Statement of Total Return, show a Revenue return on ordinary
activities before taxation of £304,000 against £194,000 for the comparable
period last year. This was achieved partly through an increase in dividend
income received but also due to savings in interest and expenses. After
adjusting for taxation and provisions against investments held, the combined
result shows a return of £214,000 against £276,000 last year. This result
represents a basic return per ordinary share of 5.0p against 6.5p for 1998.
The Balance Sheet again shows an improvement for the half-year with a 5p
increase in basic net asset value per ordinary share to 100.5p per share.
As indicated in my statement at the year-end we have been able to replace
previous loan facilities with new longer term funding arrangements at lower
rates of interest. As a result the Group's net current assets since the
previous year-end have risen by £5.8 million with a concomitant increase in
long-term borrowings.
I can report that within the last few days the Group's property portfolio has
been enlarged by the acquisition of an industrial estate at Knowsley, Lancashire
which will substantially increase the Group's rental income. Whilst this will
incur a commensurate interest cost together with considerable capital repayments
in the short to medium term, your Board anticipates that significant benefit
will be gained in the longer term.
21st October, 1999 A.P. Stirling
Chairman
GRESHAM HOUSE plc
UNAUDITED CONSOLIDATED STATEMENT OF TOTAL RETURN
for the Half Year ended 30 June, 1999
6 months to 6 months to 12 months to
30th June, 1999 30th June, 1998 31st December,1998
Unaudited Unaudited Audited
Revenue Capital Total Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(Losses)/gains
on Investments - (93) (93) - 83 83 - 500 500
Income:
Dividend and
Interest Income 86 - 86 30 - 30 206 206
Rental Income 705 - 705 709 - 709 2,014 2,014
Other operating
income 70 - 70 64 - 64 8 8
Other Expenses (341) - (341) (317) - (317) (587) (587)
Net return before finance costs
and taxation 520 (93) 427 486 83 569 1,641 500 2,141
Interest payable
and similar
charges (216) - (216) (292) - (292) (579) (579)
Return on ordinary activities
before taxation 304 (93) 211 194 83 277 1,062 500 1,562
Taxation 3 3 (1) (1) (88) (88)
Return on ordinary activities after
taxation attributable to equity
shareholders 307 (93) 214 193 83 276 974 500 1,474
Interim dividend -
Equity shares - - - - - - (21) (21)
Transfer to
reserves 307 (93) 214 193 83 276 953 500 1,453
Basic return per
Ordinary Share 7.2p (2.2p) 5.0p 4.5p 2.0p 6.5p 23.0p 11.8p 34.8p
Diluted return per
Ordinary Share 7.1p (2.1p) 5.0p 4.5p 2.0p 6.5p 22.8p 11.7p 34.5p
All revenue and capital items in the above statement derive from continuing
operations.
Gresham House plc
UNAUDITED CONSOLIDATED BALANCE SHEET
as at 30th June 1999
30th June, 1999 30th June, 1998 31st December, 1998
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Investments
Securities 2,122 2,503 2,168
Properties 10,520 11,240 10,520
Other - - -
Tangible assets 391 358 396
13,033 14,101 13,084
Current assets 6,578 1,333 2,016
Creditors - amounts failing due
within one year 1,781 2,837 3,059
Net current assets/
(liabilities) 4,797 (1,504) (1,043)
Total assets less current
liabilities 17,830 12,597 12,041
Creditors - amounts failing due
after more than one year 13,570 9,728 7,995
Provisions for liabilities
and charges - - -
4,260 2,869 4,046
Capital and reserves
Called up share capital 1,060 1,060 1,060
Share premium account 242 242 242
Other reserves
Revaluation reserve 3,989 3,989 3,969
Capital reserve
- realised 17,527 17,245 17,610
Capital reserve
- unrealised 134 91 143
Revenue reserves (18,691) (19,758) (18,998)
Equity shareholders' funds 4,260 2,869 4,046
Net asset value per ordinary share
Basic 100.5p 67.7p 95.5p
Diluted 99.8p 67.3p 94.8p
UNAUDITED GROUP CASH FLOW STATEMENT
for the Half Year to 30th June 1999
30th June, 1999 30th June, 1998 31st Dec, 1998
(Unaudited) (Unaudited) (Audited)
£'000 £'000 £'000
Cashfilow from operating activities
Investment income received 41 9 35
Deposit interest recieved 36 19 162
Rental income recieved 848 709 1,962
Other cash payments (304) (297) (316)
Net cash inflow from operating
activities 621 440 1,843
(Note 2)
Returns on investment and servicing of finance
Interest paid on 2.5% Secured
Redeemable Loan Stock, 2001 (77) (89) (179)
Interest paid on property loans (139) (203) (400)
Net cash outflow from Investments
and servicing of finance (216) (292) (579)
Capital expenditure and financial investment
Purchase of tangible assets - - (45)
Purchase of investments (143) (61) (110)
Disposals of investments 99 30 109
Net loans advanced (213) (57) (145)
Sale of freehold property - - 720
Net cash (outflow)/(inflow
from capital expenditure and
financial investment (257) (88) 529
Equity dividends paid (21) - (16)
Cash inflow before use of liquid
resources and financing 127 60 1,777
Management of liquid resources
(Acquisition)lsale of listed
securities held for dealing (17) (15) 2
Financing
Acquisition of 2.5% Secured
Redeemable Loan Stock
by group company - - (625)
Increase/(reduction) in loans 5,554 (226) (953)
Net cash inflow/(outflow)
from financing 5,554 (226) (1,578)
Increas/(decrease) in cash 5,664 (181) 201
(Note 3)
STATEMENT OF MOVEMENT IN SHAREHOLDERS'FUNDS
6 months to 6 months to 12 months to
30th June,1999 30th June,1998 31st Dec,1998
£'000 £'000 £'000
Retained profit for the period 307 193 953
Net movement on capital reserves (93) 83 500
214 276 1,453
Shareholders' funds at beginning
of period 4,046 2,593 2,593
Shareholders' funds at
end of period 4,260 2,869 4,046
NOTES TO THE INTERIM STATEMENT
1 Basis of Preparation
(a) The interim statement has been prepared in accordance with the accounting
policies set out in the Group's 1998 Annual Report and Accounts.
(b) The interim statement is neither audited nor reviewed. The full year figures
for 1998 do not comprise statutory accounts for the purpose of Section 240 of
the Companies Act 1995 and have been extracted from the Group's full accounts
for that year, which received an unqualified Auditors' Report and did not
contain a statement under section 237(2) or (3) of the Companies Act 1985.
The accounts have been filed with the Registrar of Companies.
(b) Following the Company's normal accounting practice the figures do not take
into account the results of significant investments except for dividends
received which amounted to £2,146 (1998: £2,146)
2 Reconciliation of operating profit to operating cash flows.
6 months to 6 months to 12 months to
30th June,1999 30th June,1998 31st Dec.1998
£'000 £'000 £'000
Return on ordinary activities
before taxation 304 194 1,062
Interest payable 216 292 579
520 486 1,641
Depreciation 5 - 7
Provision(writeback) against loan
and guarantees 18 (19) 50
Taxation on franked
investment income (17) (1) (9)
Decrease/(increase) in debtors 198 (155) (195)
(Decrease)/increase in creditors (103) 129 349
Net cash inflow from operating
activities 621 440 1,843
3 Reconciliation of net cash flow to movement in net debt
Increasel(decrease) in cash
for the period 5,664 (181) 201
Cash (inflow)/ outflow from
(Increase)lreduction in debt (5,554) 226 1,578
Cash outflow/(inflow) from
movement in liquid resources 17 15 (2)
Change in net debt resulting from
cash flows 127 60 1,777
Discount on acquisition of loan stock
by group undertaking - - 375
Movement in net debt in
the period 127 60 2,152
Net debt at beginning
of period (8,755) (10,907) (10,907)
Balance at end of period (8,628) (10,847) (8,755)
4 Analysis of net debt
At 1st Cash Other At 30th
January flow non-cash June
1999 changes 1999
£'000 £'000 £'000 £'000
Cash at bank 750 4,530 5,280
Overdrafts (1,158) 1,134 (24)
5,664
Debt due within one year (459) 21 (438)
Debt due after one year (7,995) (5,575) (13,570)
110
Current asset investments 107 17 - 124
(8,755) 127 - (8,628)
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