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Share Name | Share Symbol | Market | Type |
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Iren Spa | BIT:IRE | Italy | Ordinary Share |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.00 | 0.00% | 1.912 | 1.912 | 1.919 | 1.915 | 1.912 | 1.912 | 8,643 | 08:04:05 |
RNS Number:4736K International Real Estate Plc 29 April 2003 International Real Estate Plc PRELIMINARY RESULTS International Real Estate Plc, ("IRE" or "the Company"), has today announced its preliminary results for the year ended 31 December 2002. The main financial highlights include: * Profits on ordinary activities before taxation of Euro849,000 (2001: Euro5,768,000) * Audited Net asset value (NAV) as reported at 31 December 2002 of Euro2.62 per share (2001: Euro2.69 per share) * Unrecognised trading stock value adds approximately Euro1.50 per share to the NAV gross before tax (2001: Euro1.38 per share) or Euro0.98 net of taxes at an assumed net average rate of 35% (2001: Euro0.90) * Total NAV gross before tax of Euro4.07 per share (2001: Euro4.07 per share) or Euro3.56 net of taxes (2001: Euro3.59) * Proposed final dividend of 3.00 pence or Euro0.05 per share, making a total for the year of 6.00 pence or Euro0.10 per share (2001: total dividend of 10.00 pence or Euro0.16 per share) * Earnings per share Euro0.01 or 0.67p per share (2001: Euro0.57 per or 35.43p share). Commenting on the results, Rolf L Nordstrom, Chairman, said: " This has been a year of consolidation for IRE. No major disposals during the period has meant that our results have not been flattered by the strong profits on disposals realised last year. However, we have benefited from the underlying rental stream integral to our portfolio. We strongly believe that even if 2003 proves to be a tougher year for the Brussels property market we will be able to improve cash flow and thus property values. Our strategy of developing a European focus has proved timely. The market conditions in Belgium, relative to most other European property markets, remain promising and we have positioned the Company well in this market place. However, we continue to examine the overall structure of the Group and we are looking forward to a challenging year. Although the litigation with Oaktree continues, we are encouraged by the positive legal advice received and that the Petition for leave to appeal to the House of Lords has now been granted ." Daniel Akselson, CEO, commented: " We are now effectively entirely invested in the Benelux property market. Despite the tougher market conditions during the year we have been able to increase rental levels at our flagship property, the IT Tower, and let the remaining floor at the QPT Tower. Following the year-end we have disposed of our Aartselaar warehouse and office building for a small profit. Net of debt, the disposal has generated around Euro5.5m of cash for IRE. Additionally, our rolling refurbishment of the IT Tower continues to add value to this prestigious site." Date: 29 April 2003 For further details contact: International Real Estate Plc City Profile Group Tel: 00 44 (0) 20 7839 8686 Ed Senior Rolf L Nordstrom, Chairman Simon Coutenay Mobile: 00 44 (0) 7776 137 400 Tel: 00 44 (0) 20 7448 3244 Daniel Akselson, Chief Executive e-mail: edward.senior@city-profile.com Mobile: 00 31 (0)653 30 4590 e-mail:info@IREplc.com Chairman's Statement CRITERION PROPERTIES PLC 31 December 2000The Annual Report and Accounts to 31 December 2002 show the refocused Group with its main operations located in Belgium. The comparative period for 2001 included the profits from the disposal of the majority of the UK property portfolio. To better reflect the activities of the Company the Shareholders decided, at the AGM, on 30 May 2002 a change of name to INTERNATIONAL REAL ESTATE PLC. As previously reported we converted into Euro (Euro) accounting from 2001. This has simplified accounting and better reflects the Group's functional currency. The share price and dividend continue to be expressed in Pounds Sterling. Financial Highlights The main financial highlights for the year ended 31 December 2002 (the year ended 31 December 2001 within brackets) include: * Profits on ordinary activities before taxation of Euro849,000 (2001: Euro5,768,000). * Audited Net asset value (NAV) as reported at 31 December 2002 Euro2.62 per share (2001: Euro2.69 per share). * Unrecognised trading stock value adds approximately Euro1.50 per share to the NAV gross before tax (Euro1.38 per share) or Euro0.98 net of taxes at an assumed net average rate of 35% (2001: Euro0.90). * Total NAV gross before tax of Euro4.07 per share (Euro4.07 per share) or Euro3.56 net of taxes (2001: Euro3.59). * Proposed final dividend of 3.00 pence or Euro0.05 per share, making a total for the year of 6.00 pence or Euro0.10 per share (2001: total dividend of 10.00 pence or Euro0.16 per share) * Earnings per share Euro0.01 or 0.67p per share (2001: Euro0.57 per or 35.43p share). The Group's result this year includes exceptional charges of Euro141,000 relating to the litigation with Oaktree (an update on this litigation is included later under Corporate matters), and Euro139,000 provided for the Company's share of the diminution in value of the Limited Partnership property, Mobius House, Basingstoke. Comparative figures for the year ended 31 December 2001 included exceptional costs amounting to Euro469,000 and a Euro1,163,000 provision for the Company's share of the diminution in value of the Limited Partnership property. Property portfolio The remaining UK property investment consists of a 25% interest in the Limited Partnership which owns Mobius House, Basingstoke. As previously reported, the sole tenant in this property, Dolphin Telecommunication Services Limited, went into administration on 1 August 2001 and vacant possession was obtained on 22 March 2002. The Limited Partnership generated income through an insurance policy covering one year's loss of rent from July 2001 to June 2002. The Limited Partnership is actively working on re-letting or selling the property. The market is weak due to oversupply of new developments and refurbished properties in the Basingstoke area. In the meantime the Limited Partnership is evaluating various refurbishment alternatives. An external valuation at 31 December 2002 resulted in a further diminution in the value of the Company's 25% interest in the Limited Partnership which has been written down from Euro1,226,000 to Euro1,017,000 to reflect the reduction in the underlying property value. During 2002 the main activities of the Group related to the IT Tower and the QPT Tower office blocks in Brussels and the Aartselaar warehouse property in Antwerp. Although the Brussels market has held up better than most European property markets, the slowdown in economic activity had some negative influence on the letting market. At the IT Tower, a 22,778 square metre landmark office building prominently located on Avenue Louise at the corner of Avenue de Mot, we focused on the letting situation, the rolling refurbishment programme and the improvement programme for the communal areas. The combination of the refurbishment programme during the latter part of 2002 and the economic climate during the year resulted in a lower level of lettings than we originally forecast. However, of the three floors taken back for refurbishment, one is fully let at an increased rent level whilst the other two remaining floors are subject to active negotiation. So far during 2003, a total of 2,032 square metres has been let at rental levels between Euro180 and Euro190 per square metre, which is higher than the average level realised during 2002. Some agreements are for areas that are not yet available as they are let to other tenants or require a fit out. The full effect of these lettings is unlikely to be realised until January 2004. In April 2003 the letting situation for the tower portion of the building was 82.0%, including pre-let areas. Fully let, the building is estimated to produce an income of approximately Euro4.41 million, equating to a gross yield of 9.8% on cost including refurbishments. The refurbishment programme for the communal areas including the entrance, lobby, lifts and parking garage has progressed according to plan and budget. The 11,255 square metre QPT Tower, located at Quai aux Pierres de Taille in central Brussels, is fully let to high quality tenants with the average length of leases approximately five years. On 3 July 2002 we sold to the Brussels Municipality 214 square metres of land (out of the total of 2,792 square metres) following an expropriation procedure, resulting in a pre tax profit of Euro205,000. The property produces an income of approximately Euro1.07 million and a gross yield of 11.3% on cost. Our third Belgian property, the 36,288 square metre warehouse and office building in Aartselaar near Antwerp was sold in April 2003 via the disposal of a company with an attributable value for the property of Euro11.975m. This transaction will be accounted for in 2003, and resulted in a small profit. The Company sold its property in Aartselaar to strengthen its liquidity. However this will also cause a significant reduction in gross rental income going forward. Corporate matters In my last two Chairman's statements, I have reported on the legal situation relating to the dismissal of Mr Aubrey Glaser as Managing Director on 3 April 2001, and the litigation with Stratford UK Properties LLC ('Oaktree'). A full explanation of the ongoing litigation with Mr. Aubrey Glaser and Oaktree is included in Note (i) Contingent Liabilities. The Company applied for Summary Judgment at a hearing on 13 and 14 March 2002, and on 27 March 2002 Mr. Justice Hart found in favour of the Company and made a declaration that the Agreement was unenforceable against it. Oaktree was subsequently successful in its appeal against this decision, with the result that the case may proceed to trial. The Company challenged the Appeal Court decision, and a petition for leave to appeal to the House of Lords has now been granted. On the basis of the legal advice it has received, the Board of Directors continues to believe that the Company is unlikely to incur a material loss as a result of the Agreement and therefore no provision has been included in the accounts for this contingent liability, but the matter will be kept under review. We will continue to focus our attention on the future of the Company and upon delivering returns from our property assets in Europe. However, 2002 has been a difficult year for the property markets, and 2003 is unlikely to show much improvement. Pending a change in legislation we intend to start publishing and distributing our annual accounts and interim statements on the internet (www.IREplc.com) in order to speed up distribution and to reduce costs. Taxation The adoption of FRS19, with full provision for deferred tax combined with the impact of unrelieved UK head office costs, resulted in a tax charge in profit and loss terms of 88% of net profits. Clearly this is not sustainable in the long term and we are examining various alternatives. Cash and Borrowings Net borrowings at 31 December 2002 of Euro43.885m compared with Euro40.879m at 31 December 2001. The increase reflected the investment programme in our trading properties of Euro3.72m and this in turn has contributed to the increase in value of our property portfolio. The year end cash position of Euro2.806m will improve substantially as a result of the sale of Aartselaar. Directors and Staff I would like to take this opportunity to thank my fellow Directors, staff and advisors for their hard work and dedication during the year helping us to further develop the Company. Dividend The Board considered the results for the year in light of the uncertain economic climate and the outstanding litigation. In the circumstances your Board proposes to pay a final dividend of 3 pence per share (Euro0.05) partly payable from revenue reserves on 21 June 2003 to shareholders on the register on 23 May 2003. An interim dividend of 3 pence (Euro0.05) was paid on 18 October 2002 making a total for the year of 6 pence per share (Euro0.10) compared with 10 pence (Euro0.16) for the previous year, which reflected the unusually high level of realisations in that year. The Board continues to be concerned at the share price discount to net asset value. The possibilities of a limited share buy back programme continue to be explored together with further property disposals. Prospects The prospects for International Real Estate remain uncertain. Despite the tougher market conditions during the year we have been able to increase rental levels in the IT Tower and let the remaining floor at the QPT Tower. Even if 2003 proves to be a tougher year for the Brussels market, we believe that we will be able to improve cash flow and thus property values. However we continue to examine the overall structure of the Group. Although the litigation with Oaktree continues we are encouraged by the positive legal advice received concerning the likely final outcome. The market conditions in Belgium, relative to most other European property markets, remain promising and we have positioned the Company well in this market place. We are looking forward to a challenging year. Rolf L Nordstrom, Chairman 29 April 2003 INTERNATIONAL REAL ESTATE PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT for the year ended 31 December 2002 Note 2002 2001 Euro'000 Euro'000 As restated* TURNOVER Net rental income 5,133 4,733 Property sales 285 37,811 ________ ________ (a) 5,418 42,544 Cost of sales (80) (28,607) ________ ________ GROSS PROFIT 5,338 13,937 Exceptional charges - Litigation (b) (141) (469) Exceptional charges - Other (b) - (740) Impairment in value of investment property (b) (139) (1,163) Other administrative expenses (1,959) (1,926) ________ ________ TOTAL ADMINISTRATIVE EXPENSES (2,239) (4,298) Other operating income 58 - ________ ________ OPERATING PROFIT 3,157 9,639 Impairment of fixed asset investments - (457) PROFIT ON ORDINARY ACTIVITIES BEFORE INTEREST 3,157 9,182 AND TAXATION Interest receivable and similar income 299 492 Interest payable and similar charges (2,355) (2,467) Exceptional finance costs (c) (252) (1,439) ________ ________ TOTAL INTEREST PAYABLE (2,607) (3,906) ________ ________ PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 849 5,768 Tax on profit on ordinary activities (d) (752) (1,581) ________ ________ PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION AND PROFIT FOR THE FINANCIAL YEAR 97 4,187 Equity dividends (f) (697) (1,160) ________ ________ Retained profit for the financial year (600) 3,027 ________ ________ Basic and diluted earnings per share (e) Euro0.01 Euro0.57 ________ ________ The results for the above years reflect the continuing operations of the Group. *The comparative figures for the year ended 31 December 2001 have been restated to reflect the introduction of FRS19 "Deferred Taxation". INTERNATIONAL REAL ESTATE PLC CONSOLIDATED BALANCE SHEET As at 31 December 2002 Note 2002 2001 Euro'000 Euro'000 As restated* FIXED ASSETS Investment properties (g) 1,017 1,226 Other tangible assets 37 90 Investments 2 20 ________ ________ 1,056 1,336 CURRENT ASSETS Stock - trading properties 65,746 62,026 Debtors 1,426 2,064 Cash at bank and in hand 2,806 7,234 ________ ________ 69,978 71,324 CURRENT LIABILITIES CREDITORS: amounts falling due within one year - Borrowings (1,234) (725) - Other (4,281) (4,482) ________ ________ (5,515) (5,207) NET CURRENT ASSETS 64,463 66,117 ________ ________ TOTAL ASSETS LESS CURRENT LIABILITIES 65,519 67,453 CREDITORS: amounts falling due after more than one year - Borrowings (45,457) (47,388) PROVISIONS FOR LIABILITIES AND CHARGES Deferred taxation (816) (219) ________ ________ 19,246 19,846 ________ ________ CAPITAL AND RESERVES Called up share capital 4,683 4,683 Share premium account 7,957 7,957 Capital redemption reserve 291 291 Profit and loss account 6,315 6,915 ________ ________ EQUITY SHAREHOLDERS' FUNDS 19,246 19,846 ________ ________ *The comparative figures for the year ended 31 December 2001 have been restated to reflect the introduction of FRS19 "Deferred Taxation". INTERNATIONAL REAL ESTATE PLC STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES for the year ended 31 December 2002 2002 2001 Euro'000 Euro'000 As restated Profit for the financial year 97 4,187 Impairment of investment properties charged to revaluation reserve - (150) ________ ________ Total recognised gains and losses relating to the year 97 4,037 ________ Prior year adjustment (127) ________ Total gains and losses recognised since the last annual report (30) ________ RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS for the year ended 31 December 2002 2002 2001 Euro'000 Euro'000 As restated Profit for the financial year 97 4,187 Dividends (697) (1,160) ________ ________ (600) 3,027 Impairment of investment properties charged to revaluation reserve - (150) ________ ________ Net (reduction in)/addition to Shareholders' funds (600) 2,877 Opening Shareholders' Funds as previously reported 19,973 16,969 Prior year adjustment (127) - ________ ________ Opening Shareholders' Funds as restated 19,846 16,969 Closing Shareholders' Funds 19,246 19,846 ________ ________ INTERNATIONAL REAL ESTATE PLC CONSOLIDATED CASH FLOW STATEMENT for the year ended 31 December 2002 2002 2002 2001 2001 Euro'000 Euro'000 Euro'000 Euro'000 Net cash inflow/(outflow) from operating activities 936 (6,127) Returns on investments and servicing of finance Interest paid (2,272) (3,263) Interest received 299 492 ________ ________ (1,973) (2,771) Taxation paid (707) (832) Capital expenditure and financial investment Purchase of and additions to investment properties - (3) Disposal of investment properties - 10,645 Purchase of other tangible fixed assets (14) (13) ________ ________ (14) 10,629 Equity dividends paid (1,196) (829) ________ ________ Cash (outflow)/inflow before financing (2,954) 70 Financing New loans drawn down - 40,648 Repayment of amounts borrowed (1,322) (35,800) ________ ________ (1,322) 4,848 ________ ________ (Decrease)/increase in cash (4,276) 4,918 ________ ________ NOTES TO THE ACCOUNTS for the year ended 31 December 2002 (a) Segmental analysis 31 December 2002 31 December 2001 as restated Operating Operating Turnover (loss)/ profit Net assets Turnover profit Net assets United Kingdom Euro'000 Euro'000 Euro'000 Euro'000 Euro'000 Euro'000 Investment 136 (136) 98 169 (2,711) (363) Trading (26) (1,519) 154 38,187 9,681 3,747 ________ ________ ________ ________ ________ ________ 110 (1,655) 252 38,356 6,970 3,384 ________ ________ ________ ________ ________ ________ Continental Europe Trading 5,308 4,812 18,994 4,188 2,669 16,462 ________ ________ ________ ________ ________ ________ 5,418 3,157 19,246 42,544 9,639 19,846 ________ ________ ________ ________ ________ ________ (b) Exceptional charges 2002 2001 Euro'000 Euro'000 Other litigation and related exceptional costs 141 469 Costs associated with the divestment of properties from the UK market - 740 Provision for impairment in value of investment properties 139 1,163 ________ ________ 280 2,372 ________ ________ The provision for impairment in value of investment properties was included below operating profit in the 2001 financial statements. The Directors have reclassified it as a charge to operating profit in the comparatives above as they believe this gives a fairer presentation. (c) Exceptional finance costs 2002 2001 Euro'000 Euro'000 Loan breakage costs - 402 Other finance costs associated with the divestment from the UK market - 500 Interest rate floor breakage costs 252 537 ________ ________ 252 1,439 ________ ________ (d) Tax on profit on ordinary activities 2002 2001 Euro'000 Euro'000 As restated The tax charge on the profit on ordinary activities for the year was as follows: UK corporation tax at 30% (2001 - 30%) - (1,762) Adjustment in respect of prior year (150) 308 ________ ________ Current tax charge (150) (1,454) Deferred taxation: timing difference (636) (127) Deferred taxation: decrease in tax rate 34 - ________ ________ (752) (1,581) ________ ________ (e) Earnings per share 2002 2001 As restated Earnings per share are calculated as follows: Profit for the year Euro96,706 Euro4,186,915 Weighted average number of shares in issue 7,357,446 7,357,446 ________ ________ Basic and diluted earnings per share Euro0.01 Euro0.57 ________ ________ (f) Equity dividends 2002 2001 Euro'000 Euro'000 Interim paid of Euro0.05 (3.0p) per share (31 December 2001 - Euro0.05 (3.0p)) 354 343 Proposed final dividend of Euro0.05 (3.0p) per share (31 December 2001 - Euro0.11 (7.0p)) 343 817 ________ ________ 697 1,160 ________ ________ (g) Investment properties Long leasehold Euro'000 Valuation at 1 January 2002 1,226 Foreign exchange translation difference (70) Impairment (139) ________ At 31 December 2002 1,017 ________ This property is held through an investment in a joint arrangement and the carrying value at 31 December 2002 represents the Company's share of the investment property. This property, with a value of Euro4,068,000 (2001 - Euro4,904,000) was valued by FPD Savills, Chartered Surveyors, (2001 - Jones Lang La Salle, Chartered Surveyors) in accordance with the requirements of the Royal Institution of Chartered Surveyors, on 31 December 2002, on the basis of market value. The Group's share of this was Euro1,017,000 (2001 - Euro1,226,000). (h) Borrowings 31 December 31 December 2001 2002 Euro'000 Euro'000 Falling due within one year Bank loans and overdrafts 1,234 725 ________ ________ Falling due after more than one year Bank and other loans - repayable between one and two years 1,440 2,881 - repayable between two and five years 5,264 4,966 - repayable other than by instalments in five years or more 31,490 31,853 - repayable by instalments in five years or more 7,263 7,688 ________ ________ 45,457 47,388 ________ ________ Total borrowings 46,691 48,113 ________ ________ Bank and other loans are secured by legal mortgages over the investment properties and trading properties. (i) Contingent liabilities By a circular dated 11 February 1998, the Company announced its entry into a limited partnership with Stratford UK Properties LLC ('Oaktree'), an entity owned by Oaktree Capital Management LLC, which is based in the United States of America. On 30 March 2000 a Supplementary Agreement ('Agreement') was entered into with Oaktree, purporting to vary the terms of the partnership. It was executed on behalf of the Company by the then Managing Director, Aubrey Glaser, and the then Company Secretary. The Agreement purported to give Oaktree the right (inter alia) to require the Company to buy out Oaktree's share of the partnership on terms highly beneficial to Oaktree in the event of a change of control of the Company or the departure or non involvement in management of the Chairman (who had no knowledge of the Agreement) or Aubrey Glaser. In June 2001 Oaktree purported to invoke the terms of the Agreement requiring the Company to buy out Oaktree's share on the basis set out above, which on current estimates would cost the Company approximately Euro12 million, increasing annually at a rate of 25% compounded monthly. The Company claims the Agreement is unenforceable and accordingly on 10 July 2001 issued proceedings in the High Court for an order that the Agreement be set aside. On the Company's application for summary judgment Mr Justice Hart found in favour of the Company and made a declaration that the Agreement was unenforceable against it. The decision was reversed by the Court of Appeal, but the House of Lords has now granted leave to appeal. On the basis of the legal advice it has received, the Board of Directors continues to believe that the Company is unlikely to incur a material loss as a result of the Agreement and therefore no provision has been included in the accounts for this contingent liability, but the matter will be kept under review. In September 2001 the Company received a claim from Mr Glaser for compensation for loss of office totalling Euro430,000 (#280,000). The Company is vigorously defending this claim and having regard to the legal advice received by the Company, no provision has been included in the accounts for this contingent liability. (j) Accounting Policies The financial information set out in this announcement has been prepared on the basis of the accounting policies stated in the statutory accounts for 31 December 2001, except for the adoption of FRS19 "Deferred Taxation" whereby prior year balances have been restated. (k) Financial information The financial information set out in this announcement does not constitute the company's statutory accounts for the years ended 31 December 2002 or 2001, but is derived from those accounts. Statutory accounts for the year ended 31 December 2001 have been delivered to the Registrar of Companies and those for the year ended 31 December 2002 will be delivered following the company's annual general meeting. The auditors reported on these accounts; their reports were unqualified and did not contain a statement under s237(2) or (3) Companies Act 1985 (l) AGM The Company will hold its AGM at 12.00 pm on 13 June 2003 at the offices of The City Law Partnership, 99 Charterhouse Street, London EC1M 6NQ. This information is provided by RNS The company news service from the London Stock Exchange END FR UWUWROARSUAR
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