Interim Results

Northacre PLC 21 December 2000 NORTHACRE PLC Interim Results for the six months to 31 August 2000 Northacre plc ('Northacre'), the premier developer of landmark residential property schemes in Central London, today announces interim results for the six months to 31 August 2000. * Turnover increased to £5,369,000 (1999: £1,055,000) * Pre tax losses of £224,000 (1999: £769,000 loss) were impacted by a one-off increase in administrative expenses of £662,000 * Loss per share reduced to 1.23p (1999: 7p loss) * Revenues commenced from KINGS Chelsea and 62% of the 288 units have been reserved and pre-sold * Final settlement on the Earls Terrace expected during the first 6 months of 2001 * Continuing to seek prime property with a number of appraisals in process John Hunter, Chief Executive, said: 'We are delighted at the early take-up of KINGS. Its development continues according to plan. The Group, over the past six months, has entered into agreements that, subject to planning permission, will provide substantial revenues over the next two to three years. We continue to seek development opportunities where the Group can apply its knowledge and expertise in order to create shareholder value.' 21 December 2000 ENQUIRIES: Northacre PLC Tel : 020 7349 8000 John Hunter, Chief Executive College Hill Tel: 020 7457 2020 Matthew Smallwood NORTHACRE PLC Interim Results for the six months to 31 August 2000 Introduction Northacre plc is widely regarded as one of the premier developers of landmark residential property schemes in Central London. It comprises three principal businesses: residential development, architectural services through Nilsson Design and interior design through Lifestyles Interiors. Our strategy for growth is to acquire equity interests in prime residential opportunities for development and investment where value can be significantly enhanced through the skills of the Group. Financial Results Shareholders will be aware that the generation of profit is dependent on the timing and stage of completion of the various projects in which Northacre is involved. Each project takes two to three years, and therefore the timing of receipt of profits from each project may be unpredictable. The turnover for the period was increased to £5,369,000 (1999: £1,055,000) which included a healthy contribution from Lifestyles Interiors and revenues from the sale of finished houses at the Earls Terrace project. Operating costs increased to £2.6m (1999: £669,000) in line with the volume of business that the Group now transacts. In addition, the pre-tax loss of £224,000 was impacted by a one-off Directors and Staff bonus related to Earls Terrace which had been put in place prior to the Group's listing as well as costs relating to being a public company, all of which totalled £662,000. Basic loss per share was 1.23p (1999: 7p). Net assets per share at 31 August 2000 were 92 pence (1999 - 90 pence). The Board is not declaring an interim dividend payment for the six months to 31 August 2000. Operating Activities Currently, the Group is actively working on four separate major developments. At Earls Terrace, the project comprising 23 Grade II listed Georgian houses, have all sold with the exception of one house. The settlement of the final account is anticipated during the first six months of 2001. The development of KINGS Chelsea, in association with European Land, is proving to be a great success. Phase I is due for completion in early 2002 and we are pleased to report that 62% of the 288 units have been reserved and pre-sold. The Group receives revenues from this project on an ongoing basis for development management as well as interior and architectural services, all of which have made a significant contribution to the scheme. Planning permission is required on both The Phillimores and South Audley Street. In both cases planning is in process and it is anticipated that the outcome for The Phillimores will be clearer towards the second half of 2001. Four further architects have been appointed at Nilsson Design to cater for its architectural role at The Phillimores as well as new private client business. NORTHACRE PLC Interim Results for the six months to 31 August 2000 Outlook The developments at KINGS Chelsea and The Phillimores are expected to generate significant income over the next two to three years as the developments proceed. Our strategy remains the same: the acquisition of equity interests in high quality residential schemes to generate development profits. Additionally, we will accrue revenue and profit from Nilsson and Lifestyles both on an integrated and stand alone basis. We believe that the market in which Northacre operates will continue to provide ample opportunities for growth. The Group continues to pursue new opportunities that will utilise our knowledge and expertise in developing and designing the highest quality residential projects in Central London. To achieve our goals we will acquire new projects and further develop our portfolio to create long term growth and shareholder value. JOHN HUNTER CHIEF EXECUTIVE NORTHACRE PLC Consolidated Profit and Loss Account (Unaudited) 6 Months 6 Months Year to to ended Note 31.8.2000 31.8.1999 28.2.2000 Unaudited Unaudited Audited £'000 £'000 £'000 Turnover 5,369 1,055 7,915 Cost of sales (2,645) (669) (2,366) Gross Profit 2,724 386 5,549 Administrative expenses 3 (2,903) (1,117) (3,439) Other operating income 42 68 92 Operating (Loss)/Profit (137) (663) 2,202 Share of profit from participating 4 - 4 interests Income from participating interests - - 30 Loss on sale of investment property - (71) (70) (Loss)/Profit on Ordinary Activities before Interest (133) (734) 2,166 Interest (net) (91) (35) (72) (Loss)/Profit on Ordinary Activities before Taxation (224) (769) 2,094 Taxation 4 - (2) (725) Retained (Loss)/Profit for the Period (224) (771) 1,369 Basic (loss)/earnings per ordinary share 5 (1.23p) (7p) 9.99p Fully diluted (loss)/earnings per (1.06p) (6p) 9.02p ordinary share NORTHACRE PLC Consolidated Balance Sheet (Unaudited) 31.8.2000 31.8.1999 28.2.2000 Unaudited Unaudited Audited £'000 £'000 £'000 £'000 Fixed Assets Intangible assets 14,552 15,329 14,941 Tangible assets 909 675 917 Investments 1,260 2 6 Investments in joint venture: Shares of gross assets 9,217 Share of gross liabilities (4,557) 4,660 - - 21,381 16,006 15,864 Current Assets Stock and work in progress 26 7 16 Debtors 1,861 814 5,109 Investment property held for 781 - - resale Bank balances and cash 532 1,059 1,205 3,200 1,880 6,330 Creditors due within one year (4,251) (2,765) (5,355) Net Current (Liabilities)/Assets (1,051) (885) 975 Total Assets less Current 20,330 15,121 16,839 Liabilities Creditors due after more than (1,936) (1,075) (122) one year Net Assets 18,394 14,046 16,717 Capital and Reserves Share capital 507 399 438 Share premium account 16,360 14,168 14,528 Revaluation reserve 130 - 130 Profit and loss account 1,397 (521) 1,621 18,394 14,046 16,717 NORTHACRE PLC Consolidated Cash Flow Statement (Unaudited) 6 Months 6 Months Year to to ended 31.8.2000 31.8.1999 28.2.2000 Unaudited Unaudited Audited £'000 £'000 £'000 Net Cash Inflow from Operating Activities 2,522 2,688 3,711 Dividends Received from Associates - - 30 Returns on Investments and Servicing of Finance Interest received 19 6 33 Interest paid (111) (41) (104) Net Cash (Outflow)/Inflow from Returns on Investments and Servicing of Finance (92) (35) (71) Taxation Corporation tax paid - (37) (1) Capital Expenditure and Financial Investment Additions to investment properties (6,691) - - Purchase of other tangible assets (76) (31) (212) Sale of investment properties - 1,575 1,575 Sale of other tangible assets 16 35 40 Net cash (outflow)/inflow for capital (6,751) 1,579 1,403 expenditure Acquisitions Purchase of subsidiary undertaking - (3,492) (3,492) Net overdraft acquired - (411) (411) Net cash outflow for acquisitions - (3,903) (3,903) Cash (Outflow)/Inflow before Management of Liquid Resources and Financing (4,321) 292 1,169 Financing Issues of ordinary share capital 1,901 35 435 Increase in debt 1,600 536 (823) Net cash inflow/(outflow) from management of liquid resources and financing 3,501 571 (388) (Decrease)/Increase in Cash in the Period (820) 863 781 NORTHACRE PLC Notes to the Unaudited Interim Financial Statement For the period ended 31 August 2000 1. Accounting Policies The interim financial statements have been prepared on the basis of the accounting policies set out in the 2000 Northacre plc Annual Report. 2. Financial Information The financial information contained in this document does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. The comparative figures for the financial period ended 31 August 1999 have been extracted from the company's interim report for that financial period. The statutory accounts for the period ended 28 February 2000 have been given an unqualified audit report and have been filed with the Registrar of Companies. 3. Administrative Expenses The administrative expenses of £2,903,000 include amortisation of goodwill of £388,065. 4. Taxation There is no taxation charge due to the availability of losses. 5. Earnings Per Share The earnings per share has been calculated on the result on ordinary activities after tax and on the weighted average number of shares in issue in the six months to 31 August 2000 of 18,208,133 (31 August 1999 11,024,845). 6. Shareholders' Funds The reconciliation of movements in shareholders' funds is as follows: £'000 Shareholders' funds at 1 March 2000 16,717 Warrants exercised during the period 1 Issue of ordinary shares 1,900 18,618 Retained loss (224) Shareholders' funds at 31 August 2000 18,394 NORTHACRE PLC Notes to the Unaudited Interim Financial Statement For the period ended 31 August 2000 7. Dividends The directors do not recommend the payment of an interim dividend. 8. Other Information The interim statement was approved by the directors on 21 December 2000. A copy of the interim statement will be posted to shareholders and made available to the public for a period of 14 days from today at the company's registered office: 48 Old Church Street, London SW3 5BY. Independent Review Report to Northacre plc Introduction We have been instructed by the company to review the financial information set out on pages 4 to 8 and we have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. Directors' Responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by the directors. The Listing Rules of the London Stock Exchange require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review Work Performed We conducted our review in accordance with guidance contained in Bulletin 1999 /4 issued by the Auditing Practices Board. A review consists principally of making enquiries of group management and applying analytical procedures to the financial information and underlying financial data and based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with Auditing Standards and therefore provides a lower level of assurance than an audit. Accordingly we do not express an audit opinion on the financial information. Review Conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the six months ended 31 August 2000. Kingston Smith Chartered Accountants and Registered Auditors Devonshire House 60 Goswell Road London EC1M 7AD 21 December 2000

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