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TIDMBA59
RNS Number : 2561C
Capital Shopping Centres PLC
27 April 2012
27 April 2012
Capital Shopping Centres PLC ("the company")
ANNUAL FINANCIAL REPORT
Capital Shopping Centres PLC has today published its Annual Report for the year ended 31 December 2011 ("Annual Report"). The Annual Report will shortly be available for download at www.capital-shopping-centres.co.uk.
In accordance with DTR 6.3.5, the following information is extracted from the company's Annual Report and in unedited full text.
Management Report
Principal Activities
The Capital Shopping Centres PLC group ("the Group") specialises in the ownership, management and development of prime UK regional shopping centres.
The Group's assets comprise four major out-of-town centres being - Lakeside, Thurrock; Metrocentre, Gateshead; Braehead, Glasgow and The Mall at Cribbs Causeway, Bristol - and seven in-town centres including centres in prime destinations such as Cardiff, Manchester, Norwich and Nottingham. During the year the Potteries shopping centre was sold to another Capital Shopping Centres Group PLC company and in November 2011, Broadmarsh shopping centre in Nottingham was acquired bringing the portfolio to 12 shopping centres.
With a dedicated and skilled management team, the Group aims to be the landlord of choice for retailers and to provide compelling destinations for shoppers. The Group is a responsible and environmentally conscious participant in the communities where it invests. The Group focuses on the creation of long term and sustainable growth in net rental income with a view to generating superior returns for its parent company.
Review Of Business And Future Developments
The Group's results and financial position for the year ended 31 December 2011 are set out in full in the consolidated income statement, the consolidated statement of comprehensive income, the Group and Company balance sheets, the Group and Company statements of changes in equity, the Group and Company statements of cash flows and the related notes. The Group's profit before taxation was GBP52.3 million (2010 GBP474.0 million) with the reduction from 2010 being due to a lower property revaluation gain in 2011. The Group's net assets attributable to equity shareholders increased from GBP1,028.1 million to GBP1,080.4 million. Net external debt increased by GBP66.8 million to GBP2,514.0 million at 31 December 2011.
Prospects And Priorities
The Group's base case assumption is that the UK economy will continue to experience low growth for some time, with continuing risk of tenant failures and closures on expiry of leases.
The Group's specialist skills and relationships enable it to mange those risks while identifying and developing those shopping centres which have the most potential to produce attractive returns over the medium to long term.
The Group considers that it is well positioned to create value as the market recovers.
The Group's strategic priorities for 2012 are:
-- to optimise the performance of its existing assets, prioritising medium-term value creation
-- to identify further initiatives and create the financing flexibility to advance its business and deliver incremental returns
Market Review
The Group's focus is the top 50 million sq. ft. of UK shopping centre locations, less than 5 per cent of the UK's 1.4 billion sq. ft. of retail space of which it owns 26 per cent by area. Such centres are and will remain rare and change hands infrequently. Shopping centres in total represent only around 14 per cent of the UK's 1.4 billion sq. ft. of retail space, the top 50 centres representing less than 5 per cent. The highly regulated planning environment combined with the recent challenging economic environment for financing of new centres has contributed to a limited development pipeline.
The Group's centres can offer retailers flagship stores in top locations. Such stores are increasingly becoming a crucial marketing tool for the retailer's brand. The development of other retail channels such as online shopping reinforce the concentration of physical comparison retailing into the destinations, such as the Group's, most attractive to the shopper for retail and broader entertainment. Online sales comprise only a small but growing proportion of total retail spend. The most successful retailers now have an integrated approach to online and in-store sales, with strong evidence of high levels of interaction between the two. This is highlighted by the popularity of "click and collect" and "return to store" facilities, both of which reinforce the need for a physical store and produce incremental sales.
Successful retailers are seeking out the most cost effective access to their customers, be that through online or physical footfall, with the best located stores and integration of online and physical space.
Investment Property Valuations
As income yields appeared attractive relative to risk free investment returns, the UK property market has in 2011 seen good demand for prime assets and vendors reluctant to sell other than at robust levels. As a result, yields for prime assets such as CSC's have remained stable to slightly tightening.
By comparison secondary retail property, a category in which none of CSC's regional shopping centres would be classified, has had more variable pricing. Yields have increased during 2011 as purchasers allowed for their expectation of falling rents (see Market review), as the pool of potential lenders reduced by well publicised withdrawals from UK real estate lending and with the unresolved overhang of defaulted property in the hands of lenders.
The valuation outcome for the Group's assets for the year was positive, rising by 0.7 per cent for the full year. This is marginally ahead of the IPD UK monthly retail capital growth index which produced an increase of 0.6 per cent for the year.
Net Rental Income
The Group's net rental income which increased by 1.9 per cent to GBP268.4 million in the year Like-for-like net rental income for 2011 is 3.7 per cent above that of 2010.
Occupancy
Occupancy remains high at 97.0 per cent (31 December 2010 97.4 per cent).
Footfall
Estimated footfall across the Group's 11 centres was over 244 million in the year, up 2 per cent in the year.
Major Centres
Lakeside, Thurrock, (market value GBP1,081 million) Successful new openings in the autumn include the 25,000 sq. ft. new concept Topshop/Topman flagship store to be followed in late 2012 by Forever 21's fourth UK store. A planning application was submitted in December for a 325,000 sq. ft. extension including a new department store, 30 to 40 new shops and restaurants and a new transport hub. Discussions are progressing with major retailers.
Metrocentre, Gateshead, (market value GBP864 million). A 15,000 sq. ft. terrace of restaurants, "MetrOasis", is now pre-let to 3 catering operators with the final unit in solicitors hands. Construction started last month and the development is expected to open in the autumn. This will further strengthen the ambience of the retail park and improve the connections between the main centre and the retail park.
Braehead, Glasgow, (market value GBP583 million) With Apple and Hollister plus a new restaurant cluster open and trading well, plans have been drawn up to improve impact and sight lines on the upper mall by increasing the height of shop fronts and moving escalators. We continue to work with the local authority on a master plan for the mix of uses in the broader Braehead area and, as part of these plans, have acquired an adjacent 31 acre site, currently a working dock, with future development potential.
Nottingham (Victoria Centre market value GBP333 million, Broadmarsh market value GBP65 million): Nottingham ranks sixth in the UK in terms of available comparison shopping expenditure but has suffered relative to other cities from a lack of modernisation of its shopping centre provision. Following the acquisition of Broadmarsh in the last quarter of 2011, we are optimistic about the city's potential assuming a pragmatic approach by the local authority. We aim to bring forward proposals for complementary development to upgrade both centres and the city centre overall.
Bromley (The Glades market value GBP174 million): we are in the process of obtaining planning consent for a terrace of five restaurants overlooking the adjacent gardens. We received 10 offers from catering operators for the five units and have comfortably exceeded the target rent for the project.
Cash Flow
The Group cash flow shows a total outflow of GBP53.0 million in 2011, reflecting the acquisition of The Broadmarsh Shopping Centre, Nottingham for GBP72.8m
Financial Position
The Group's debt is largely arranged on an asset-specific basis, with limited or non-recourse from the borrowing entities to other Group companies. This structure permits the Group a high degree of financial flexibility in dealing with debt issues and importantly avoids the concentration of covenant and refinancing risk associated with a single group-wide borrowing.
Net external debt, which excludes the Metrocentre compound financial instrument of GBP146.6 million, increased from GBP2,447.2 million at 31 December 2010 to GBP2,514.0 million at 31 December 2011. The Group had cash of GBP34.4 million at 31 December 2011 (2010 GBP87.4 million).
Financial Covenants
Financial covenants apply to GBP2.5 billion of secured asset-specific debt. The two main covenants are Loan to Value (LTV) and Interest Cover (IC). The actual requirements vary and are specific to each loan. The Group is in compliance with all of its corporate and asset-specific loan covenants.
Key Performance Indicators
The performance of the business is monitored through a number of Key Performance Indicators (KPI's) including both financial and non-financial measures. The main KPI's used by the Board to monitor the business are like-for-like net rental income, occupancy and prime property asset performance. These KPI's can be found in this Directors' Report containing details of our portfolio and operational performance and additionally in the notes to these financial statements, in particular, note 22.
Key Risks and Uncertainties
The key risks and uncertainties facing the Group are set out in the table below:
Hot Features
Premium
Risk and Mitigation Change 2011 Commentary
Impact
------------- ------------------------------------------------------------ ------- ------------------------------------------------------------
Property Market
--------------------------------------------------------------------------------------------------------------------------------------------------
Macro
environment * Focus on prime assets e * Despite macro concerns and reducing consumer
weakness confidence from early summer 2011, positive valuation
could movement of 1 per cent for the year reflecting prime
undermine * Covenant headroom monitored and stress tested nature of assets
rental
income
levels and * Regular monitoring of tenant strength and diversity * Covenant headroom on individual properties increased
property during 2011
values,
reducing
return
on
investment
and covenant
headroom
------------- ------------------------------------------------------------ ------- ------------------------------------------------------------
Financing
--------------------------------------------------------------------------------------------------------------------------------------------------
Reducing
availability * Regular internal reporting to Board of current and - * Renewed uncertainty in banking and debt markets,
of funds projected funding position although the Group has no major loan maturities until
could 2015.
limit
liquidity * Effective treasury management aimed at balancing long
leading to debt maturity profile and diversification of sources
restriction of finance
of investing
and
operating
activities
and/or
increase
in funding
cost
------------- ------------------------------------------------------------ ------- ------------------------------------------------------------
Operations
------------- ------------------------------------------------------------ -----------------------------------------------------------
Accident,
system * Strong business process and procedures supported by e * Seamless transition to "Facilities Alliance", CSC
failure regular training and exercises innovative property management partnership, with
or external efficiency savings reinvested in fabric improvements
factors
could * Annual audits of operational standards carried out by
threaten the internal and external consultants * Mid year riots provided test of existing procedures:
safe and generally well managed, learning points implemented
secure including new policies on monitoring and use of
environment * Culture of visitor safety social media
provided for
shoppers and
retailers, * Retailer liaison and briefings * Regulatory change: good ranking in Carbon Reduction
leading to Commitment "early action metrics"
financial
and/or * Appropriate levels of insurance
reputational
loss
------------- ------------------------------------------------------------ -----------------------------------------------------------
Strategy and execution
--------------------------------------------------------------------------------------------------------------------------------------------
Misjudged
or poorly * Annual strategic review informed by external research - * Focus on optimising performance of pre-eminent
executed and advice centres to benefit from ongoing structural shift in
project UK retail, including broader offer of leisure and
results in catering and inclusion of "theatre"
increased * Management team experienced in shopping centre and
cost or broader retail industry
income * Fresh perspective from new management has enhanced
foregone, debate while maintaining our long term sustainable
hence fails * Engagement with national and international retailers growth objective
to create
shareholder
value * Key staff succession planning, performance-based
incentives
------------- ------------------------------------------------------------ -----------------------------------------------------------
Development and acquisitions
-----------------------------------------------------------------------------------------------------------------------------------------
Misjudged -
or poorly * Access to the expertise and knowledge in the CSC * Increased focus on pre-let space before committing
executed Group's Capital Projects Committee, which reviews capital projects
project detailed appraisals before and monitors progress
results in during significant projects
increased * Unprecedented number of planning applications
cost or including local consultations, positioning the Gro
income * Research and third party due diligence undertaken for up
foregone, transactions for next phase of growth
hence fails
to create
shareholder
value
------------ ------------------------------------------------------------ ---------------------------------------------------------
Share Capital
Details of share capital are set out in note 23.
Going Concern
The directors have reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. For this reason they continue to adopt the going concern basis in preparing the financial statements.
Attention is drawn to the Going Concern disclosure included in Note 1 to the consolidated financial statements.
Dividends
The directors do not recommend a final dividend for the year (2010 nil).
Creditor Payment Policy
The Group's policy and practice is to pay creditors in accordance with agreed terms of business. The company does not ordinarily pay its creditors directly as this is carried out by other companies in Capital Shopping Centres Group PLC. As a result, the company has a nil trade payable balance and it is not practical to calculate creditor days for the company as at 31 December 2011 (2010 nil trade payable balance).
Directors' Indemnity Provision
A qualifying indemnity provision (as defined in S234 of the Companies Act 2006) is in force for the benefit of the Directors of the Company and its associated companies. The company's parent, Capital Shopping Centres Group PLC, maintains Directors' and Officers' insurance which is reviewed annually.
Charitable Donations
During the year the Group made charitable donations of GBP68,508 (2010 GBP79,810) and no political donations (2010 GBPnil).
Directors
The directors who held office during the year and until the date of this report are given below:
Mike Butterworth appointed 11 March 2011
Martin Ellis
David Fischel
Hugh Ford appointed 3 November 2011
Trevor Pereira
Matthew Roberts
Peter Weir appointed 3 November 2011 Kay Chaldecott resigned 30 September 2011 Caroline Kirby resigned 17 October 2011
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the Group and parent Company financial statements in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union. Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and the Company and of the profit or loss of the Group and Company for that period. In preparing these financial statements, the Directors are required to:
-- select suitable accounting policies and then apply them consistently; -- make judgements and estimates that are reasonable and prudent;
-- state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material departures disclosed and explained in the financial statements;
-- prepare the financial statements on the going concern basis, unless it is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group and enable them to ensure that the financial statements comply with the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Each of the Directors, whose names and functions are listed in the Directors' Report confirm that, to the best of each their knowledge:
(a) the Group financial statements, which have been prepared in accordance with IFRSs as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and profit of the Group and Company; and
(b) the Directors' report contained in the annual report includes a fair review of the development and performance of the business and the position of the Group and Company, together with a description of the principal risks and uncertainties that they face.
Disclosure of Information to Auditors
So far as the Directors are aware, there is no relevant audit information of which the auditors are unaware and each Director has taken all reasonable steps to make himself or herself aware of any relevant audit information and to establish that the auditors are aware of that information.
Independent Auditors
The auditors, PricewaterhouseCoopers LLP, have indicated their willingness to continue in office and a resolution seeking to reappoint them will be proposed at the forthcoming Annual General Meeting.
On behalf of the Board on
Matthew Roberts
Director
26 April 2012
Peter Weir
Director
26 April 2012
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF
CAPITAL SHOPPING CENTRES PLC
We have audited the financial statements of Capital Shopping Centres PLC (company number 2893329) for the year ended 31 December 2011 which comprise the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income, the Group and Company Balance Sheets, the Group and Company Statements of Changes in Equity, the Group and Company Statements of Cash Flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union and, as regards the Company financial statements, as applied in accordance with the provisions of the Companies Act 2006.
Respective responsibilities of Directors and auditors
As explained more fully in the Statement of Directors' Responsibilities set out on page 8, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors.
This report, including the opinions, has been prepared for and only for the Company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Group's and Parent company's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Directors; and the overall presentation of the financial statements.
Opinion on financial statements
In our opinion:
-- the financial statements give a true and fair view of the state of the Group's and of the Company's affairs as at 31 December 2011 and of the Group's profit and Group's and Company's cash flows for the year then ended;
-- the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;
-- the Company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
-- the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the group financial statements, Article 4 of the IAS Regulation.
INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF
CAPITAL SHOPPING CENTRES PLC
Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Directors' Report for the financial year for which the financial statements are prepared is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:
-- adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or
-- the Company financial statements are not in agreement with the accounting records and returns; or
-- certain disclosures of Directors' remuneration specified by law are not made; or -- we have not received all the information and explanations we require for our audit.
Alison Morris (Senior Statutory Auditor)
for and on behalf of
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
London
26 April 2012
CONSOLIDATED INCOME STATEMENT
FOR THE YEAR ENDED 31 DECEMBER 2011
2011 2010
Notes GBPm GBPm
Revenue 3 381.7 389.9
======= =======
Net rental income 4 268.4 263.3
Net other income (0.5) 0.7
Revaluation and sale of investment and
development
property 6 30.0 479.0
Administration expenses - ongoing (9.2) (11.1)
Administration expenses - exceptional (3.3) -
Impairment of goodwill - (3.1)
------- -------
Operating profit 285.4 728.8
------- -------
Finance costs 7 (164.7) (173.1)
Finance income 8 2.8 2.3
Other finance costs 9 (42.3) (50.6)
Change in fair value of derivative financial
instruments (28.9) (33.4)
------- -------
Net finance costs (233.1) (254.8)
------- -------
Profit before tax 10 52.3 474.0
------- -------
Current tax 11 - 1.2
Deferred tax 11 - (0.1)
REIT entry charge 11 - (3.0)
------- -------
Taxation - (1.9)
------- -------
Profit for the year 52.3 472.1
======= =======
Attributable to:
Equity shareholders of Capital Shopping
Centres PLC 48.7 455.3
Non-controlling interest 3.6 16.8
------- -------
52.3 472.1
======= =======
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2011
2011 2010
GBPm GBPm
Profit for the year 52.3 472.1
Total comprehensive income for the year 52.3 472.1
==== =====
Attributable to:
Equity shareholders of Capital Shopping Centres
PLC 48.7 455.3
Non-controlling interest 3.6 16.8
---- -----
Total comprehensive income for the year 52.3 472.1
==== =====
BALANCE SHEETS
AS AT 31 DECEMBER 2011
Group Group Company Company
2011 2010 2011 2010
Notes GBPm GBPm GBPm GBPm
Non-current assets
Goodwill 29 8.8 - - -
Investment and development
property 14 4,770.5 4,807.5 - -
Investment in group companies 15 - - 1,014.5 1,024.4
Derivative financial instruments 22 - 4.6 - -
Trade and other receivables 18 77.0 69.5 - -
4,856.3 4,881.6 1,014.5 1,024.4
--------- --------- --------- ---------
Current assets
Trading property 17 7.5 25.5 - -
Trade and other receivables 18 49.1 48.2 1,905.9 1,911.8
Cash and cash equivalents 34.4 87.4 0.2 52.3
--------- --------- --------- ---------
91.0 161.1 1,906.1 1,964.1
--------- --------- --------- ---------
Total assets 4,947.3 5,042.7 2,920.6 2,988.5
--------- --------- --------- ---------
Current liabilities
Trade and other payables 19 (893.6) (1,085.1) (1,653.1) (1,739.7)
Borrowings 20 (48.1) (45.5) - -
Derivative financial instruments 22 (1.9) - - -
--------- --------- --------- ---------
(943.6) (1,130.6) (1,653.1) (1,739.7)
--------- --------- --------- ---------
Non-current liabilities
Borrowings 20 (2,646.9) (2,627.8) (26.8) (26.7)
Derivative financial instruments 22 (271.3) (251.0) - -
Other payables (5.1) (5.2) (5.0) (4.9)
--------- --------- --------- ---------
(2,923.3) (2,884.0) (31.8) (31.6)
--------- --------- --------- ---------
Total liabilities (3,866.9) (4,014.6) (1,684.9) (1,771.3)
Net assets 1,080.4 1,028.1 1,235.7 1,217.2
========= ========= ========= =========
Equity
Share capital 23 197.3 197.3 197.3 197.3
Share premium 1,146.9 1,146.9 1,146.9 1,146.9
Other reserves 8.3 8.3 8.3 8.3
Retained earnings (295.6) (344.3) (116.8) (135.3)
--------- --------- --------- ---------
Attributable to equity
shareholders of
Capital Shopping Centres
PLC 1,056.9 1,008.2 1,235.7 1,217.2
Non-controlling interest 23.5 19.9 - -
--------- --------- --------- ---------
Total equity 1,080.4 1,028.1 1,235.7 1,217.2
========= ========= ========= =========
Notes on pages 17 to 50 form part of these consolidated financial statements.
These consolidated financial statements have been approved for issue by the Board of Directors on 26 April 2012 and signed on its behalf by
Matthew Roberts
Director
Peter Weir
Director
STATEMENTS OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2011
Group Share Non-
Share premium Other Retained controlling Total
capital account reserves earnings Total interest equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
At 1 January 2010 197.3 646.9 8.3 (799.6) 52.9 - 52.9
Profit for the year - - - 455.3 455.3 16.8 472.1
-------- -------- --------- --------- -------- ------------ --------
Total comprehensive
income for the year - - - 455.3 455.3 16.8 472.1
-------- -------- --------- --------- -------- ------------ --------
Ordinary shares
issued - 500.0 - - 500.0 - 500.0
Non-controlling
interest
additions - - - - - 3.1 3.1
-------- -------- --------- --------- -------- ------------ --------
At 31 December 2010 197.3 1,146.9 8.3 (344.3) 1,008.2 19.9 1,028.1
======== ======== ========= ========= ======== ============ ========
At 1 January 2011 197.3 1,146.9 8.3 (344.3) 1,008.2 19.9 1,028.1
Profit for the year - - - 48.7 48.7 3.6 52.3
-------- -------- --------- --------- -------- ------------ --------
Total comprehensive
income for the year - - - 48.7 48.7 3.6 52.3
-------- -------- --------- --------- -------- ------------ --------
At 31 December 2011 197.3 1,146.9 8.3 (295.6) 1,056.9 23.5 1,080.4
======== ======== ========= ========= ======== ============ ========
Company Share
Share premium Other Retained Total
capital account reserves earnings equity
GBPm GBPm GBPm GBPm GBPm
At 1 January 2010 197.3 646.9 8.3 (259.8) 592.7
Profit for the year - - - 124.5 124.5
-------- -------- --------- --------- --------
Total comprehensive
income for the year - - - 124.5 124.5
-------- -------- --------- --------- --------
Ordinary shares issued - 500.0 - - 500.0
-------- -------- --------- --------- --------
At 31 December 2010 197.3 1,146.9 8.3 (135.3) 1,217.2
======== ======== ========= ========= ========
At 1 January 2011 197.3 1,146.9 8.3 (135.3) 1,217.2
Profit for the year - - - 18.5 18.5
-------- -------- --------- --------- --------
Total comprehensive
income for the year - - - 18.5 18.5
-------- -------- --------- --------- --------
At 31 December 2011 197.3 1,146.9 8.3 (116.8) 1,235.7
======== ======== ========= ========= ========
STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2011
Group Group Company Company
2011 2010 2011 2010
Notes GBPm GBPm GBPm GBPm
Cash generated from operations 24 242.1 388.4 (52.8) 58.2
Interest paid (200.5) (210.2) (63.7) (63.8)
Interest received 2.8 2.3 64.4 56.0
Tax received - 1.4 - -
REIT entry charge paid (18.9) (36.6) - -
Cash flows from operating
activities 25.5 145.3 (52.1) 50.4
-------- -------- -------- --------
Purchase and development
of
property (20.0) (27.4) - -
Sale of property 1.7 64.4 - -
Acquisition of businesses (72.8) - -
Other derivative instruments - (7.3) - -
Cash flows from investing
activities (91.1) 29.7 - -
-------- -------- -------- --------
Borrowings repaid (43.8) (663.2) - -
Borrowings drawn 56.4 518.7 - -
Cash transferred to restricted
accounts - 19.8 - -
Partnership equity introduced - 3.1 - -
Cash flows from financing
activities 12.6 (121.6) - -
-------- -------- -------- --------
Net (decrease)/increase
in cash
and cash equivalents (53.0) 53.4 (52.1) 50.4
Cash and cash equivalents
at
1 January 87.4 34.0 52.3 1.9
-------- -------- -------- --------
Cash and cash equivalents
at
31 December 34.4 87.4 0.2 52.3
======== ======== ======== ========
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
1. Principal accounting policies
Accounting convention and basis of preparation
These financial statements have been prepared in accordance with International Financial Reporting Standards, as adopted by the European Union (IFRS), IFRIC interpretations and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The directors have taken advantage of the exemption offered by Section 408 of the Companies Act not to present a separate income statement for the company.
The financial statements have been prepared under the historical cost convention as modified by the revaluation of properties, available-for-sale investments, financial assets and liabilities held for trading. A summary of the more important group accounting policies is set out below.
The accounting policies used are consistent with those applied in the last annual financial statements, as amended to reflect the adoption of new standards, amendments, and interpretations which became effective in the year. During 2011, the following standards, amendments and interpretations endorsed by the EU became effective for the first time for the Group's 31 December 2011 year end:
-- IFRS 24 Related Party Disclosures; -- IFRS 32 Financial Instruments: Presentation (amendment);
-- IFRIC 14 IAS 19 - The limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction;
-- IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments; and
Amendments arising from 2010 annual improvements project.
These either had no material impact on the financial statements or resulted in changes to presentation and disclosure only.
The following standard has been issued and adopted by the EU but is not effective for the year ended 31 December 2011 and has not been adopted early:
-- IFRS 7 Financial Instruments: Disclosures (amendment)
This pronouncement is not expected to have a material impact on the financial statements, but may result in changes to presentation or disclosure.
The preparation of financial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management's best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates. Where such judgements are made they are included within the accounting policies given in note 1.
The group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Directors' Report on pages 1 to 8 The financial position of the group, its cash flows, liquidity position and borrowing facilities are described in the Directors' Report on pages 1 to 8. In addition note 22 includes the group's risk management objectives, details of its financial instruments and hedging activities, its exposures to liquidity risk and details of its capital structure.
Accounting convention and basis of preparation
The Directors have undertaken a review of the projected financial position of the Company and the Group, which includes reasonable assumptions about future trading and cash flows. This review included an assessment of cash balances, the debt maturity profile, the economic conditions faced by tenants and the financial position of the Group's parent company, Capital Shopping Centres Group PLC.
Based on the Group's forecasts and projections and taking into account reasonably possible changes in trading performance along with the factors listed above, the Directors have concluded that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.
Accounting policies - group and company
Basis of consolidation
The consolidated financial information includes the company and its subsidiaries and their interests in joint ventures and associates.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation.
- subsidiaries
A subsidiary is an entity for which the company has the ability, either directly or indirectly, to govern the financial and operating policies, whether through a majority of the voting rights or otherwise. Subsidiaries are fully consolidated from the date on which control is transferred to the group and are de-consolidated from the date that control ceases.
The company's investment in group companies is carried at cost less accumulated impairment losses.
- joint ventures
A joint venture is an entity or operation for which the company, either directly or indirectly, is in a position to jointly control the financial and operating policies of the entity or operation.
The group's interest in a joint venture is accounted for using proportional consolidation. The group's share of the assets, liabilities, income and expenses are combined with the equivalent items in the consolidated financial statements on a line-by-line basis.
- associates
An associate is an entity over which the company, either directly or indirectly, is in a position to exercise significant influence by participating in, but without control or joint control of the financial and operating policies of the entity.
The Group's interest in an associate is accounted for using the equity method.
- non-controlling interest
A non-controlling interest is the equity in a subsidiary not attributable, directly or indirectly, to the company. Non-controlling interests are presented within equity, separately from the amounts attributable to equity shareholders of the company. Profit or loss and each component of other comprehensive income is attributed to equity shareholders of the company and to non-controlling interests in the appropriate proportions.
Revenue recognition
The group recognises revenue when the amount of revenue can be reliably measured and it is probable that future economic benefits will flow to the group.
- property revenue
Rental income receivable is recognised on a straight line basis over the term of the lease. Directly attributable lease incentives are recognised within rental income on the same basis.
Contingent rents, being those lease payments that are not fixed at the inception of a lease, for example increases arising on rent reviews or rents linked to tenant revenues, are recorded as income in the periods in which they are earned. Rent reviews are recognised as income from the date of the rent review, based on management's estimates. Estimates are derived from knowledge of market rents for comparable properties determined on an individual property basis and updated for progress of negotiations.
Service charge income is recognised on an accruals basis in line with the service being provided.
- trading property income
Revenue on the sale of trading property is recognised when the significant risks and rewards of ownership have been transferred to the buyer. This will normally take place on exchange of contracts.
Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and the effective interest rate.
Dividend income
Dividend income is recognised when the right to receive payment has been established.
Exceptional items
Exceptional items are those items that in the directors' view are required to be separately disclosed by virtue of their size or incidence to enable a full understanding of the Group's financial performance.
Taxation
Current tax is the amount payable on the taxable income for the year and any adjustment in respect of prior years. It is calculated using rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is provided using the balance sheet liability method in respect of temporary differences between the carrying amounts of assets and liabilities in the balance sheet and their tax bases.
Temporary differences are not provided on the initial recognition of assets or liabilities that affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they will not reverse in the foreseeable future.
Deferred tax is determined using tax rates that have been enacted or substantively enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.
Deferred tax assets are recognised only to the extent that management believe it is probable that future taxable profit will be available against which the temporary differences can be utilised. Deferred tax assets and liabilities are offset only when they relate to taxes levied by the same authority and the group intends to settle them on a net basis.
Tax is included in the income statement except when it relates to items recognised directly in other comprehensive income or equity, in which case the related tax is also recognised directly in other comprehensive income or equity.
Investment and development property
Investment and development property is owned or leased by the Group and held for long-term rental income and capital appreciation.
The group has elected to use the fair value model. Properties are initially recognised at cost and subsequently revalued at the balance sheet date to fair value as determined by professionally qualified external valuers on the basis of market value. Valuations conform with the Royal Institution of Chartered Surveyors ("RICS"), Valuation Standards 7th Edition and IVS1 of International Valuation Standards.
The main estimates and judgements underlying the valuations are in relation to market rent, taking into account forecast growth rates and yields based on known transactions for similar properties and likely incentives offered to tenants.
Properties held under leases are stated gross of the recognised finance lease liability.
The cost of investment and development property includes capitalised interest and other directly attributable outgoings incurred during development. Interest is capitalised on the basis of the average rate of interest paid on the relevant debt outstanding. Interest ceases to be capitalised on the date of practical completion.
Gains or losses arising from changes in the fair value of investment and development property are recognised in the income statement. Depreciation is not provided in respect of investment and development property.
When the use of a property changes from that of investment to trading, the property's deemed cost for subsequent accounting in accordance with IAS 2 Inventories is its fair value at the date of change in use.
Gains or losses arising on the sale of investment and development property are recognised when the significant risks and rewards of ownership have been transferred to the buyer. This will normally take place on exchange of contracts. The gain or loss recognised is the proceeds received less the carrying value of the property and costs directly associated with the sale.
Leases
Leases are classified according to the substance of the transaction. A lease that transfers substantially all the risks and rewards of ownership to the lessee is classified as a finance lease. All other leases are normally classified as operating leases.
- Group as lessee
Finance leases of investment property are accounted for as finance leases and recognised as an asset and an obligation to pay future minimum lease payments. The investment property asset is included in the balance sheet at fair value, gross of the recognised finance lease liability. Contingent rents are recognised as they accrue.
Other finance lease assets are capitalised at the lower of the fair value of the leased asset or the present value of the minimum lease payments and depreciated over the shorter of the lease term and the useful life of the asset.
Lease payments are allocated between the liability and finance charges so as to achieve a constant financing rate.
Rentals payable under operating leases are charged to the income statement on a straight-line basis over the lease term.
- Group as lessor
Investment properties are leased to tenants under operating leases, with rental income being recognised on a straight-line basis over the lease term. For more detail see the revenue recognition accounting policy.
Plant and equipment
Plant and equipment consists of vehicles, fixtures, fittings and other equipment. Plant and equipment is stated at cost less accumulated depreciation and any accumulated impairment losses.
Depreciation is charged to the income statement on a straight-line basis over an asset's estimated useful life up to a maximum of five years.
Other investments
Available-for-sale investments, being investments intended to be held for an indefinite period, are initially and subsequently measured at fair value. For listed investments, fair value is the current bid market value at the reporting date. For unlisted investments where there is no active market, fair value is assessed using an appropriate methodology.
Gains or losses arising from changes in fair value are included in other comprehensive income, except to the extent that losses are considered to represent a permanent impairment, in which case they are recognised in the income statement.
Upon disposal, accumulated fair value adjustments are recycled from reserves to the income statement.
Goodwill
Goodwill arising on business contributions is carried at cost less accumulated impairment losses. Goodwill is assessed for impairment on an annual basis.
Impairment of assets
The group's assets are reviewed at each balance sheet date to determine whether events or changes in circumstances exist that indicate that their carrying amount may not be recoverable. If such an indication exists, the asset's recoverable amount is estimated. The recoverable amount is the higher of an asset's fair value less costs to sell and its value in use. An impairment loss is recognised in the income statement for the amount by which the asset's carrying amount exceeds its recoverable amount. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows.
Trading property
Trading property comprises those properties either intended for sale or in the process of construction for sale. Where such properties were previously categorised as investment and development property they are transferred at their fair value which forms their deemed cost. Trading property is carried at the lower of cost and net realisable value.
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost.
The directors' exercise judgement as to the collectability of trade receivables and determine if it is appropriate to impair these assets. Factors such as days past due, credit status of the counterparty and historical evidence of collection are considered.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, deposits with banks, whether restricted or unrestricted and other short-term liquid investments with original maturities of three months or less.
Trade payables
Trade payables are recognised initially at fair value and subsequently measured at amortised cost.
Provisions
Provisions are recognised when the group has a current obligation arising from a past event and it is probable that the group will be required to settle that obligation. Provisions are measured at the directors' best estimate of the expenditure required to settle that obligation at the balance sheet date.
Pensions
The costs of defined contribution schemes and contributions to personal plans are charged to the income statement in the year in which they are incurred.
Borrowings
Borrowings are recognised initially at their net proceeds on issue and subsequently carried at amortised cost. Any transaction costs and premiums or discounts are recognised over the contractual life using the effective interest method.
In the event of early repayment, all unamortised transaction costs are recognised immediately in the income statement.
Derivative financial instruments
The group uses derivative financial instruments to manage exposure to interest rate and foreign exchange risk. They are initially recognised on the trade date at fair value and subsequently re-measured at fair value based on market price.
Changes in fair value are recognised directly in the income statement, except for the effective portion of gains or losses on derivative financial instruments designated as a hedge of net investment in foreign operations, in which case they are recognised in other comprehensive income. Where derivative financial instruments are designated as a fair value hedge, the relevant fair value movements on the hedged item are also taken to the income statement.
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new ordinary shares are shown in equity as a deduction, net of tax, from the proceeds.
2. Segmental reporting
The Group operates a single business activity in a single economic environment, namely the development and management of regional shopping centres within the United Kingdom.
The principal profit indicator used to measure performance is net rental income. An analysis of net rental income is given in note 4.
3. Revenue
2011 2010
GBPm GBPm
Rent receivable and service charge income 374.2 379.6
Sale of trading property 7.5 10.3
----- -----
381.7 389.9
===== =====
4. Net rental income
2011 2010
GBPm GBPm
Revenue 381.7 389.9
======= =======
Rent receivable 321.3 326.0
Service charge income 52.9 53.6
------- -------
374.2 379.6
Rent payable (17.3) (15.1)
Service charge costs (56.6) (60.5)
Other non-recoverable costs (31.9) (40.7)
------- -------
Net rental income 268.4 263.3
======= =======
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2011
5. Operating leases
The Group earns rental income by leasing its investment properties to tenants under operating leases.
In the UK, the standard shopping centre lease is for a term of 10 to 15 years. Standard lease provisions include service charge payments, recovery of other direct costs and review every five years to market rent. Standard revenue based leases have a revenue percentage agreed with each lessee which is applied to a retail unit's annual sales and any excess between the resulting revenue rent and the minimum rent is receivable by the Group.
The future minimum lease amounts receivable under non-cancellable operating leases are as follows:
2011 2010
GBPm GBPm
Not later than one year 301.6 325.7
Later than one year and not later than five years 960.4 1,062.2
Later than five years 892.4 1,359.7
2,154.4 2,747.6
======= =======
6. Revaluation and sale of investment and development property
2011 2010
GBPm GBPm
Revaluation of investment and development
property 30.0 482.4
Sale of investment property - (3.4)
----- ------
30.0 479.0
===== ======
7. Finance costs
2011 2010
GBPm GBPm
On bank loans and overdrafts 130.0 134.2
On amounts due to related companies 31.1 36.2
On obligations under finance leases 3.6 3.7
------ ------
Gross finance costs 164.7 174.1
Interest capitalised on development - (1.0)
------ ------
164.7 173.1
====== ======
8. Finance income
2011 2010
GBPm GBPm
On amounts due from related companies 2.3 2.2
Other 0.5 0.1
----- -----
2.8 2.3
===== =====
9. Other finance costs
2011 2010
GBPm GBPm
Amortisation of Metrocentre compound financial
instrument 7.9 8.8
Costs of termination of derivative financial
instruments 34.4 41.8
42.3 50.6
===== =====
10. Profit/(loss) before tax
Group:
The profit before tax of GBP52.3 million (2010 GBP474.0 million) is arrived at after charging:
Auditors' remuneration is in respect of the statutory audit of the company and consolidated accounts. Auditors' remuneration of GBP77,000 (2010 GBP70,000) was settled on behalf of the company by its ultimate parent Capital Shopping Centres Group PLC and has not been recharged.
11. Taxation
Tax expense for the year
2011 2010
GBPm GBPm
Current UK corporation tax at 26.5% (2010 28%) - -
Prior year items - (1.2)
------ ------
Current tax - (1.2)
Deferred tax - 0.1
REIT entry charge - 3.0
Total tax expense - 1.9
====== ======
The tax expense for the year is lower (2010 lower) than the standard rate of corporation tax in the UK. The differences are explained below:
2011 2010
GBPm GBPm
Profit before tax 52.3 474.0
------- --------
Profit before tax multiplied by the standard
rate in the UK of 26.5% (2010 28%) 13.9 132.7
Capital allowances not reversing on sale - (3.7)
Disposal of properties and investments 0.1 (18.3)
Prior year corporation tax items - (1.2)
Prior year deferred tax items (2.0) -
Expenses disallowed, net of capitalised interest 1.5 3.1
UK transfer pricing adjustment 3.4 3.3
Group relief (without payment) 0.9 1.3
REIT exemption - corporation tax (16.7) 7.3
REIT exemption - deferred tax (3.1) (125.7)
REIT exemption - entry charge - 3.0
Losses utilised in the period - 0.1
Unprovided deferred tax 1.9 -
Reduction in tax rate 0.1 -
Total tax expense - 1.9
======= ========
Tax items that are taken directly to equity are shown in the consolidated statement of comprehensive income.
12. Dividends
The Board has not proposed a final dividend in respect of 2011 (2010 nil).
13. Profit for the financial year attributable to shareholders of Capital Shopping Centres PLC
A profit of GBP18.5 million is dealt with in the accounts of the holding company in respect of the year (2010 GBP124.5 million). No income statement is presented for the company as permitted by Section 408 of the Companies Act 2006.
14. Investment and development property
Group Freehold Leasehold Total
GBPm GBPm GBPm
At 1 January 2010 2,374.8 1,986.4 4,361.2
Addition from acquisition of subsidiary
companies 27.0 - 27.0
Additions from subsequent expenditure 12.1 8.1 20.2
Transferred to trading property - (16.1) (16.1)
Disposals (36.1) (31.1) (67.2)
Surplus on revaluation 302.1 180.3 482.4
--------- ---------- --------
At 31 December 2010 2,679.9 2,127.6 4,807.5
Addition from acquisition of subsidiary
companies - 65.0 65.0
Additions from subsequent expenditure 12.1 42.2 54.3
Transferred from trading property 11.5 - 11.5
Disposal of subsidiary company (196.2) - (196.2)
Disposals - (1.6) (1.6)
Surplus on revaluation 9.4 20.6 30.0
--------- ---------- --------
At 31 December 2011 2,516.7 2,253.8 4,770.5
========= ========== ========
Included within additions is GBPnil million (2010 GBP1.0 million) of interest capitalised on developments in progress.
Group 2011 2010
GBPm GBPm
Balance sheet carrying value of investment
and development property 4,770.5 4,807.5
Adjustment in respect of tenant incentives 86.2 79.0
Adjustment in respect of head leases (36.0) (36.7)
Market value of investment and development property 4,820.7 4,849.8
======= =======
The fair value of the Group's investment and development properties as at 31 December 2011 was determined by independent external valuers at that date. The valuations conform with the Royal Institution of Chartered Surveyors ("RICS") Valuation Standards 7th Edition and with IVS 1 of International Valuation Standards, and were arrived at by reference to market transactions for similar properties.
The main assumptions underlying the valuations are in relation to market rent, taking into account forecast growth rates and yields based on known transactions for similar properties and likely incentives offered to tenants.
There are certain restrictions on the realisability of investment property when a credit facility is in place. In most circumstances the Group can realise up to 50 per cent without restriction providing the Group continues to manage the asset. Realising an amount in excess of this would trigger a change of control and mandatory repayment of the facility.
15. Investments in group companies
Accumulated
Cost impairment Net
GBPm GBPm GBPm
At 1 January 2010 1,280.8 (362.2) 918.6
Acquisitions 9.9 - 9.9
Impairment reversal for the year - 95.9 95.9
-------- ------------ --------
At 31 December 2010 1,290.7 (266.3) 1,024.4
Additions 1.0 - 1.0
Disposal (25.1) 25.1 -
Impairment charge for the year - (10.9) (10.9)
-------- ------------ --------
At 31 December 2011 1,266.6 (252.1) 1,014.5
======== ============ ========
IAS 36 Impairment of Assets allows for reversal of impairment charges providing the reversal is calculated on a consistent basis to the original impairment. At 31 December 2010, this resulted in a reversal of GBP95.9 million.
The principal subsidiary undertakings are listed below. All subsidiaries are wholly owned by the company and are registered in England and Wales unless otherwise stated. All subsidiary undertakings have been included in the consolidated results.
Company and principal activity Class of share capital % held
Ordinary shares of
Belside Limited (property) (Jersey) GBP1 each 100
"A" ordinary shares
of GBP1 each 100
"B" ordinary shares
Braehead Glasgow Limited (property) of 1.3 Euros each 100
Ordinary shares of
Braehead Park Investments Limited (property) GBP1 each 100
Ordinary shares of
Braehead Park Estates Limited (property) GBP1 each 100
"A" Ordinary shares
Broadmarsh Retail General Partner Limited of GBP1 each 100
acting as General Partner of The Broadmarsh "B" Ordinary shares
Retail Limited Partnership of GBP1 each 100
Chapelfield GP Limited acting as General
Partner of The Chapelfield Partnership Ordinary shares of
(property) GBP1 each 100
Ordinary shares of
CSC Harlequin Limited (property) GBP1 each 100
Ordinary shares of
CSC Lakeside Limited (property) GBP1 each 100
Ordinary shares of
CSC Enterprises (commercial promotion) GBP1 each 100
CSC Properties Investments Limited Ordinary shares of
(property) GBP1 each 100
Ordinary shares of
CSC Bromley Limited (property) GBP1 each 100
CSC Uxbridge (Jersey) Limited (property) Ordinary shares of
(Jersey) GBP1 each 100
Ordinary shares of
Curley Limited (property) (Jersey) GBP1 each 100
Metrocentre (GP) Limited acting as
General Partner of The Metrocentre Ordinary shares of
Partnership (property) GBP1 each 100 1
VCP (GP) Limited acting as General Ordinary shares of
Partner of The Victoria Centre Partnership GBP1 each 100
Ordinary shares of
WRP Management Limited (property) GBP1 each 100
1 By virtue of their 40% interest in The Metrocentre Partnership, GIC Real Estate is entitled to appoint 40 per cent of the Directors of Metrocentre (GP) Limited. The non-controlling interest balance of GBP23.5 million balance shown in the Group balance sheet as at 31 December 2011 relates to GIC Real Estate's interest and is calculated in accordance with IAS 27 Consolidated and Separate Financial Statements.
16. Joint ventures
2011
St David's Xscape
Limited Braehead
Partnership Partnership Other Total
GBPm GBPm GBPm GBPm
Summarised income statements
Gross rental income 13.5 2.0 - 15.5
------------ ------------ ------ --------
Net rental income 9.4 1.6 0.2 11.2
Net other income 0.6 - - 0.6
Revaluation and sale of investment
and
development property 5.3 1.4 6.7
Net finance costs (7.5) (1.3) - (8.8)
------------
Profit for the year 7.8 1.7 0.2 9.7
============ ============ ====== ========
Summarised balance sheets
Investment and development property 272.6 24.1 - 296.7
Other non-current assets 1.0 2.6 - 3.6
Current assets 31.5 1.4 0.3 33.2
Partners' loans (38.6) (8.4) - (47.0)
Current liabilities (65.1) (3.4) - (68.5)
Non-current liabilities (96.3) (22.7) - (119.0)
------------
Net assets/(liabilities) 105.1 (6.4) 0.3 99.0
============ ============ ====== ========
2010
St David's Xscape
Limited Braehead
Partnership Partnership Other Total
GBPm GBPm GBPm GBPm
Summarised income statements
Gross rental income 13.4 0.9 0.9 15.2
------------ ------------ ------ --------
Net rental income 6.6 0.5 0.2 7.3
Net other income 1.0 - - 1.0
Revaluation and sale of investment
and 39.3 0.6 - 39.9
development property (0.1) - - (0.1)
Net finance costs (3.1) (1.5) - (4.6)
------------
Profit/(loss) for the year 43.7 (0.4) 0.2 43.5
============ ============ ====== ========
Summarised balance sheets
Investment and development property 231.0 22.6 - 253.6
Other non-current assets 0.2 2.4 - 2.6
Current assets 35.9 1.9 0.2 38.0
Partners' loans (102.3) (8.4) - (110.7)
Current liabilities (28.5) (2.9) - (31.4)
Non-current liabilities (37.8) (24.0) - (61.8)
------------
Net assets/(liabilities) 98.5 (8.4) 0.2 90.3
============ ============ ====== ========
Joint ventures are accounted for in the consolidated accounts using proportional consolidation. The Group's share of the assets, liabilities, income and expenditure shown above are included in the consolidated financial statement on a line-by-line basis.
The joint ventures include the St David's Limited Partnership and the Xscape Braehead Partnership. The St David's Limited Partnership was established in 2004 for investment in the existing St David's shopping centre, Cardiff, and development of a 967,500 sq. ft. retail-led mixed--use extension. The Xscape Braehead Partnership was established in 2004, for investment in the Xscape Leisure Scheme at Braehead, Renfrew, Glasgow.
All joint ventures are held with other joint venture investors on a 50:50 basis.
17. Trading property
Group 2011 2010
GBPm GBPm
Undeveloped sites - 11.5
Property in development 3.2 11.1
Completed properties 4.3 2.9
---- ----
7.5 25.5
==== ====
The estimated replacement of cost of trading properties, based on their market value at 31 December 2011, is GBP7.5 million (2010 GBP27.4 miliion). GBP11.5 million in respect of undeveloped sites was transferred to investment and development property during the year.
18. Trade and other receivables
Group Group Company Company
2011 2010 2011 2010
GBPm GBPm GBPm GBPm
Current:
Trade receivables 12.1 13.7 - -
Amounts owed by subsidiary
undertakings - - 1,904.1 1,908.9
Amounts owed by related companies 2.5 5.0 - -
Other receivables 12.7 10.0 0.9 2.4
Prepayments and accrued income 21.8 19.5 0.9 0.5
49.1 48.2 1,905.9 1,911.8
===== ===== ======= =======
Non-current:
Prepayments and accrued income 77.0 69.5 - -
===== ===== ======= =======
Amounts owed by subsidiary undertakings and related companies are unsecured, repayable on demand and for amounts falling within formalised loan agreements, interest bearing.
Included within prepayments and accrued income are tenant lease incentives of GBP86.2 million (2010 GBP79.0 million).
19. Trade and other payables
Group Group Company Company
2011 2010 2011 2010
GBPm GBPm GBPm GBPm
Current:
Rents received in advance 66.6 69.1 - -
Amounts owed to subsidiary
undertakings - - 814.3 805.7
Amounts owed to related companies 718.1 926.4 834.0 926.1
Accruals and deferred income 75.3 38.8 2.0 3.1
Other payables 17.9 17.0 1.7 3.6
Other tax and social security 15.7 33.8 1.1 1.2
893.6 1,085.1 1,653.1 1,739.7
===== ======= ======= =======
Amounts owed to subsidiary undertakings and related companies are unsecured and payable on demand.
20. Borrowings
Group 2011
Carrying Un- Fixed Floating Fair
value Secured secured rate rate value
GBPm GBPm GBPm GBPm GBPm GBPm
Current
Bank loans and
overdrafts 18.5 18.5 - - 18.5 18.5
Commercial
mortgage backed
securities
("CMBS") notes 26.7 26.7 - - 26.7 20.2
Borrowings excluding
finance leases 45.2 45.2 - - 45.2 38.7
Finance lease
obligations 2.9 2.9 - 2.9 - 2.9
--------- -------- -------- ------ --------- --------
48.1 48.1 - 2.9 45.2 41.6
========= ======== ======== ====== ========= ========
Non-current
CMBS notes 2015 1,083.9 1,083.9 - - 1,083.9 818.3
Bank loans 2014 114.8 114.8 - - 114.8 114.8
Bank loans 2016 734.9 734.9 - - 734.9 734.9
Bank loans 2017 506.8 506.8 - - 506.8 506.8
CSC bonds 2013 26.8 - 26.8 26.8 - 26.9
--------- -------- -------- ------ --------- --------
Borrowings
excluding
finance leases
and Metrocentre
compound
instrument 2,467.2 2,440.4 26.8 26.8 2,440.4 2,201.7
Metrocentre
compound
financial
instrument 146.6 - 146.6 146.6 - 146.6
Finance lease
obligations 33.1 33.1 - 33.1 - 33.1
--------- -------- -------- ------ --------- --------
2,649.9 2,473.5 173.4 206.5 2,440.4 2,381.4
========= ======== ======== ====== ========= ========
Total borrowings 2,695.0 2,521.6 173.4 209.4 2,485.6 2,423.0
========= ======== ======== ====== ========= ========
Cash and cash
equivalents (34.4)
---------
Net debt 2,660.6
=========
Net external debt (adjusted for the Metrocentre compound financial instrument) at 31 December 2011 was GBP2,514.0 million.
The Group substantially eliminates its interest rate exposure to floating rate debt as illustrated in note 22.
Company 2011
Carrying Un- Fixed Floating Fair
value Secured secured rate rate value
GBPm GBPm GBPm GBPm GBPm GBPm
Non-current
CSC bonds 2013 26.8 - 26.8 26.8 - 26.9
--------- -------- -------- ------ --------- ------
Total borrowings 26.8 - 26.8 26.8 - 26.9
========= ======== ======== ====== ========= ======
Cash and cash
equivalents (0.2)
Net cash 26.6
=========
Group 2010
Carrying Un- Fixed Floating Fair
value Secured secured rate rate value
GBPm GBPm GBPm GBPm GBPm GBPm
Current
Bank loans and overdrafts 16.5 16.5 - - 16.5 16.5
Commercial
mortgage
backed securities
("CMBS") notes 25.4 25.4 - - 25.4 20.0
Borrowings
excluding
finance leases 41.9 41.9 - 41.9 36.5
Finance lease
obligations 3.6 3.6 - 3.6 - 3.6
--------- -------- -------- ------ --------- --------
45.5 45.5 - 3.6 41.9 40.1
========= ======== ======== ====== ========= ========
Non-current
CMBS notes 2015 1,110.7 1,110.7 - - 1,110.7 852.7
Bank loans 2014 58.4 58.4 - - 58.4 58.4
Bank loans 2016 749.1 749.1 - - 749.1 749.1
Bank loans 2017 511.1 511.1 - - 511.1 511.1
CSC bonds 2013 26.7 - 26.7 26.7 - 27.3
--------- -------- -------- ------ --------- --------
Borrowings excluding
finance leases and
Metrocentre
compound
instrument 2,456.0 2,429.3 26.7 26.7 2,429.3 2,198.6
Metrocentre
compound
financial
instrument 138.7 - 138.7 138.7 - 138.7
Finance lease
obligations 33.1 33.1 - 33.1 - 33.1
--------- -------- -------- ------ --------- --------
2,627.8 2,462.4 165.4 198.5 2,429.3 2,370.4
========= ======== ======== ====== ========= ========
Total borrowings 2,673.3 2,507.9 165.4 202.1 2,471.2 2,410.5
========= ======== ======== ====== ========= ========
Cash and cash
equivalents (87.4)
---------
Net debt 2,585.9
=========
Net external debt (adjusted for the Metrocentre compound financial instrument) at 31 December 2010 was GBP2,447.2 million.
The Group substantially eliminates its interest rate exposure to floating rate debt as illustrated in note 22.
Company 2010
Carrying Un- Fixed Floating Fair
value Secured secured rate rate value
GBPm GBPm GBPm GBPm GBPm GBPm
Non-current
CSC bonds 2013 26.7 - 26.7 26.7 - 27.3
--------- -------- -------- ------ --------- ------
Total borrowings 26.7 - 26.7 26.7 - 27.3
========= ======== ======== ====== ========= ======
Cash and cash
equivalents (52.3)
Net cash (25.6)
=========
21. Finance lease obligations
Group Group
2011 2010
GBPm GBPm
Minimum lease payments under finance leases fall due:
Not later than one year 4.4 3.6
Later than one year and not later than five years 16.6 17.8
Later than five years 63.1 65.9
------ ------
84.1 87.3
Future finance charges on finance leases (48.1) (50.6)
------ ------
Present value of finance lease liabilities 36.0 36.7
====== ======
Present value of minimum finance lease obligations
Not later than one year 2.9 3.6
Later than one year and not later than five years 12.0 14.0
Later than five years 21.1 19.1
36.0 36.7
====== ======
Finance lease liabilities are in respect of leasehold investment property. A number of the Group's head leases provide for payment of contingent rent, usually a proportion of net rental income, in addition to the rents above.
22. Financial risk management
The Group is exposed to a variety of risks arising from the Group's operations, these are principally market risk (including interest rate risk and market price risk), liquidity risk and credit risk.
The majority of the Group's financial risk management is carried out by Capital Shopping Centres Group PLC's treasury department and the policies for managing each of these risks and the principal effects of these policies on the results for the year are summarised below.
Market risk
Interest rate risk
Interest rate risk comprises both cash flow and fair value risks:
Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate due to changes in market interest rates. Fair value interest rate risk is the risk that the fair value of financial instruments will fluctuate as a result of changes in market interest rates.
The Group's interest rate risk arises from borrowings issued at variable rates that expose the Group to cash flow interest rate risk, whereas borrowings issued at fixed interest rates expose the Group to fair value interest rate risk.
Bank debt is typically issued at floating rates linked to LIBOR. Bond debt and other capital market debt are generally issued at fixed rates.
It is Group policy, and often a requirement of the Group's lenders, to eliminate substantially all short and medium-term exposure to interest rate fluctuations in order to establish certainty over medium-term cash flows by using floating to fixed interest rate swaps. Such swaps have the economic effect of converting borrowings from floating to fixed rates. As a consequence, the Group is exposed to market price risk in respect of the fair value of its fixed interest rate swaps.
The below table shows the effects of interest rate swaps on the Group borrowings profile of the Group:
Fixed Floating Fixed Floating
2011 2011 2010 2010
GBPm GBPm GBPm GBPm
Borrowings 209.4 2,485.6 202.1 2,471.2
Derivative impact 2,436.0 (2,436.0) 2,222.4 (2,222.4)
-------- ---------- -------- ----------
Net borrowings profile 2,645.4 49.6 2,424.5 248.8
-------- ---------- -------- ----------
Interest rate protection
on floating debt 98.0% 89.9%
========== ==========
The weighted average rate of interest rates contracted through interest rates swaps is 4.4 per cent (2010 4.9 per cent).
The approximate impact of a 50 basis point shift upwards in the level of interest rates would be a positive movement of GBP44.4 million (2010 GBP53.6 million) in the fair value of derivatives. The approximate impact of a 50 basis point shift downwards in the level of interest rates would be a negative movement of GBP45.3 million (2010 GBP54.6 million) in the fair value of derivatives. In practice, a parallel shift in the yield curve is highly unlikely. However, the above sensitivity analysis is a reasonable illustration of the possible effect from the changes in slope and shifts in the yield curve that may actually occur. Because the fixed rate derivative financial instruments are matched by floating rate debt, the overall effect on Group cash flow of such a movement would be very small.
Liquidity risk
Liquidity risk is managed to ensure that the Group is able to meet future payment obligations when financial liabilities fall due. Liquidity analysis is conducted to ensure that sufficient headroom is available to meet the Group's operational requirements and committed investments. The Group treasury policy aims to meet this objective through maintaining adequate cash, marketable securities and committed facilities to meet these requirements. The Group's policy is to seek to optimise its exposure to liquidity risk by balancing its exposure to interest rate risk and to refinancing risk. In effect the Group seeks to borrow for as long as possible at the lowest acceptable cost.
The maturity profile of Group debt showed an average maturity of 4 years (2010 - five years). The Group regularly reviews the maturity profile of its financial liabilities and seeks to avoid bunching of maturities through the regular replacement of facilities and by using a selection of maturity dates. Refinancing risk may be reduced by re-borrowing prior to the contracted maturity date, effectively switching liquidity risk for market risk.
The Group may pre-fund capital expenditure by arranging facilities or raising debt in the capital markets and then placing surplus funds on deposit until required for the project. Efficient treasury management and strict credit control minimise the costs and risk associated with this policy which ensures that funds are available to meet commitments as they fall due.
The tables below set out the maturity analysis of the Group's financial liabilities based on the undiscounted contractual obligations to make payments of interest and to repay principal. Where interest payment obligations are based on a floating rate the rates used are those implied by the par yield curve.
Group 2011
Within Over
1 1-2 3-5 5
year years years years Totals
GBPm GBPm GBPm GBPm GBPm
Borrowings (including
interest) (95.1) (94.4) (2,023.1) (494.3) (2,706.9)
Tax and other payables (35.4) (1.0) (2.4) - (38.8)
Finance lease obligations (3.0) (2.9) (9.0) (21.1) (36.0)
Derivatives payments (97.5) (100.5) (188.3) (3.4) (389.7)
Derivative receipts 24.4 24.5 60.2 2.1 111.2
-------- -------- ---------- -------- -----------
(206.6) (174.3) (2,162.6) (516.7) (3,060.2)
======== ======== ========== ======== ===========
Group 2010
Within Over
1 1-2 3-5 5
year years years years Totals
GBPm GBPm GBPm GBPm GBPm
Borrowings (including
interest) (89.6) (101.2) (1,547.2) (1,148.3) (2,886.3)
Tax and other payables (50.8) (1.9) (2.8) (0.5) (56.0)
Finance lease obligations (3.7) (4.4) (13.4) (65.9) (87.4)
Derivatives payments (103.8) (105.9) (279.6) (31.8) (521.1)
Derivative receipts 19.4 28.1 187.6 33.8 268.9
-------- -------- ---------- ---------- -----------
(228.5) (185.3) (1,655.4) (1,212.7) (3,281.9)
======== ======== ========== ========== ===========
Company 2011
Within
1 1-2 3-5 Over 5
year years years years Totals
GBPm GBPm GBPm GBPm GBPm
Borrowings (including
interest) (1.8) (27.7) - - (29.5)
Tax and other payables (4.5) (0.9) (2.4) - (7.8)
------- ------- ------- ------- -----------
(6.3) (28.6) (2.4) - (37.3)
======= ======= ======= ======= ===========
Company 2010
Within Over
1 1-2 3-5 5
year years years years Totals
GBPm GBPm GBPm GBPm GBPm
Borrowings (including
interest) (1.8) (1.8) (27.8) - (31.4)
Tax and other payables (4.8) (1.7) (2.8) (0.4) (9.7)
------- ------ ------- ------ ---------
(6.6) (3.5) (30.6) (0.4) (41.1)
======= ====== ======= ====== =========
Credit risk
Credit risk is the risk of financial loss if a tenant or counterparty fails to meet an obligation under a contract. Credit risk arises primarily from trade receivables relating to tenants but also from the Group's holdings of assets with counterparties such as cash deposits, loans and derivative instruments.
Credit risk associated with trade receivables is actively managed; tenants are managed individually by asset managers, who continuously monitor and work with tenants, anticipating and, wherever possible, identifying and addressing risks prior to default.
Prospective tenants are assessed via a review process, including obtaining credit ratings and reviewing financial information which is conducted internally. As a result deposits or guarantors may be obtained. The amount of deposits held as collateral at 31 December 2011 is GBP2.2 million (2010 GBP2.2 million).
Due to the nature of tenants being managed individually by asset managers, it is Group policy to calculate any impairment specifically on each tenant receivable balance.
The ageing analysis of the Group's trade receivables is as follows:
Group Group
2011 2010
GBPm GBPm
Up to three months 11.2 11.0
Three to six months 0.9 2.7
Trade receivables 12.1 13.7
===== =====
At 31 December 2011 trade receivables are shown net of provision totalling GBP3.8 million (2010 GBP2.5 million)
The credit risk relating to cash, deposits and derivative financial instruments is actively managed by the Group's treasury department. Relationships are maintained with a number of tier one institutional counterparties, ensuring compliance with Group policy relating to limits on the credit ratings of counterparties (between BBB+ and AAA).
Excessive credit risk is avoiding through adhering to authorised limits for all counterparties.
Classification of financial assets and liabilities
The table below sets out the Group's accounting classification of each class of financial assets and liabilities, and their fair values at 31 December 2011 and 31 December 2010.
The fair values of quoted borrowings are based on the ask price. The fair values of derivative financial instruments are determined from observable market prices or estimated using appropriate yield curves at 31 December each year by discounting the future contractual cash flows to the net present values.
Gain/(loss)
Carrying Fair to income
value value statement
2011 GBPm GBPm GBPm
Derivative financial
instrument assets - - -
---------- ---------- ------------
Total held for trading assets - - -
---------- ---------- ------------
Trade and other receivables 126.1 126.1 -
Cash and cash equivalents 34.4 34.4 -
---------- ---------- ------------
Total cash and receivables 160.5 160.5 -
Derivative financial instrument
liabilities (273.2) (273.2) (28.9)
---------- ---------- ------------
Total held for trading liabilities (273.2) (273.2) (28.9)
---------- ---------- ------------
Trade and other payables (898.7) (898.7) -
Borrowings (2,695.0) (2,423.0) -
---------- ---------- ------------
Total loans and payables (3,593.7) (3,321.7) -
========== ========== ============
Gain/(loss)
Carrying Fair to income
value value statement
2010 GBPm GBPm GBPm
Derivative financial instrument
assets 4.6 4.6 -
---------- ---------- ------------
Total held for trading assets 4.6 4.6 -
---------- ---------- ------------
Trade and other receivables 117.7 117.7 -
Cash and cash equivalents 87.4 87.4 -
---------- ---------- ------------
Total cash and receivables 205.1 205.1 -
---------- ---------- ------------
Derivative financial instrument
liabilities (251.0) (251.0) (33.4)
---------- ---------- ------------
Total held for trading liabilities (251.0) (251.0) (33.4)
---------- ---------- ------------
Trade and other payables (1,090.3) (1,090.3) -
Borrowings (2,673.3) (2,410.5) -
---------- ---------- ------------
Total loans and payables (3,763.6) (3,500.8) -
========== ========== ============
Capital structure
The company is a wholly owned subsidiary of Capital Shopping Centres Group PLC and owns the majority of Capital Shopping Centres Group PLC's property investments.
The company's capital structure has been designed to ensure an appropriate balance is achieved between permitting all subsidiary companies to operate effectively and allowing the ultimate parent company the ability to allocate capital across the larger group in a flexible and efficient manner. The Group uses a mix of equity, third party and intergroup debt to achieve these aims.
The only financial assets and liabilities of the company recognised at fair value are derivative financial instruments. These are all held at fair value through profit or loss and are categorised as level 2 in the fair value hierarchy as explained below.
Fair value hierarchy
Level 1: valuation based on quoted market prices traded in active markets.
Level 2: valuation techniques are used, maximising the use of observable market data, either directly from market prices or derived from market prices.
Level 3: where one or more inputs to valuation are not based on observable market data. Valuations at this level are more subjective and therefore more closely managed, including sensitivity analysis of inputs to valuation models. Such testing has not indicated that any material difference would arise due to a change in input variables.
23. Share capital
Share capital
GBPm
Issued and fully paid
At 31 December 2011 and 2010 - 394,651,178 ordinary
shares of
50p each 197.3
==============
The concept of authorised share capital was abolished by the Companies Act 2006 with effect from 1 October 2009.
Under saving provisions, the current maximum number of shares which may be issued by the company is 600,000,000 ordinary shares of 50p each.
24. Cash generated from operations
Group Group Company Company
2011 2010 2011 2010
GBPm GBPm GBPm GBPm
Profit before tax 52.3 474.0 18.5 125.5
Adjustments for:
Revaluation and sale of
investment and development
property (30.0) (479.0) - -
Amortisation of lease incentives
and other direct costs (0.2) (1.2) 1.0 0.5
Impairment of investments in
group companies - - 10.9 (95.9)
Finance costs 164.7 173.1 63.8 63.8
Finance income (2.8) (2.3) (64.4) (56.0)
Other finance costs 42.3 50.6 - -
Impairment of goodwill - 3.1 - -
Change in fair value of derivative
financial instruments 28.9 33.4 - -
Changes in working capital:
Change in trading property 6.5 4.5 - -
Change in trade and other
receivables (11.0) (27.4) (0.5) (130.0)
Change in trade and other
payables (8.6) 159.6 (82.1) 150.3
------- -------- -------- --------
Cash generated from
operations 242.1 388.4 (52.8) 58.2
======= ======== ======== ========
25. Directors' emoluments
The aggregate emoluments of the directors were GBPnil (2010 GBP1,388,694).
The highest paid director received aggregate emoluments of GBPnil (2010 GBP532,798).
As highlighted in note 26, employees, including directors, are contracted with a related company, CSC Management Services Limited, and the salary and related costs are shown in the accounts of CSC Management Services Limited.
26. Employees information
At 31 December 2011 the number of persons employed was 71 (2010 nil). The average number of employees during the year was 16 (2010 1).
UK salaried employees are contracted with a related company, CSC Management Services Limited, and the salary and related costs are shown in the accounts of CSC Management Services Limited. One company within the Group company employs individuals on behalf of other companies in the wider Capital Shopping Centres Group PLC group.
Costs of individuals employed by Group companies are.
2011 2010
GBPm GBPm
Wages and salaries 0.5 -
Social security costs - -
Pension contributions - -
---- ----
0.5 -
==== ====
27. Pensions
The company participates in Group pension arrangements as disclosed in the notes to the report and accounts of Capital Shopping Centres Group PLC, the ultimate parent company. Pension costs, representing contributions payable by the company to the Group pension arrangements, totalled GBP16,000 (2010 GBP89).
28. Capital commitments
At 31 December 2011 the Group was contractually committed to GBP32.4 million (2010 GBP86.2 million) of future expenditure for the purchase, construction, development and enhancement of investment property. The majority of this is expected to be spent in 2012.
29. Business combinations
Acquisition of Broadmarsh
On 1 December 2011 the Group acquired a 100% interest in The Broadmarsh Retail Limited Partnership for an initial cash consideration of GBP72.8 million. In March 2012 the final consideration was subsequently adjusted for the agreed net assets value of the business at 1 December 2011 which resulted in a reduction to the purchase price of GBP2.6 million. The fair value of the consideration is therefore assessed as GBP70.2 million. Exceptional administration costs of GBP3.3 million associated with the acquisition have been recognised in the income statement.
The Broadmarsh Retail Limited Partnership owns and manages the Broadmarsh shopping centre, Nottingham.
The fair value of assets and liabilities acquired is set out in the table below.
Fair value
Book value adjustment Fair value
GBPm GBPm GBPm
Investment and development
property 63.9 1.1 65.0
Trade and other receivables 1.6 (1.1) 0.5
Trade and other payables (4.1) - (4.1)
----------- ----------- -----------
Net assets 61.4 - 61.4
----------- ----------- -----------
Fair value of consideration paid 70.2
-----------
Goodwill recognised on acquisition 8.8
===========
The fair value of the consideration exceeds the fair value of the assets and liabilities acquired and as a result goodwill of GBP8.8 million is recognised in the balance sheet on acquisition. This goodwill represents future cash flows which the Group expects to receive as a result of the acquisition.
During the year the acquired business contributed GBP0.3 million to the revenue of the Group and GBP0.1 million to the profit for the year. Had the acquisition taken place at 1 January 2011 the revenue of the Group for the year would have been GBP397.9 million and the profit for the year would have been GBP71.6 million.
30. Disposal of group company
On 30 September 2011 the Group disposed of its interest in CSC Potteries Limited to another Capital Shopping Centres Group PLC company for consideration of GBP29.8m which was equal to the net assets sold and so resulted in a nil gain on disposal. The value of assets and liabilities disposed of is set out in the table below.
GBPm
Investment and development property 196.2
Trade and other receivables 3.8
Trade and other payables (170.2)
--------
Net assets 29.8
Consideration received 29.8
--------
Profit on disposal of group company -
========
31. Key management compensation
2011 2010
GBPm GBPm
Salaries and short-term employee benefits - 1.5
Pensions and other post-employment benefits - 0.1
Share based payment - 0.2
Long term incentives - -
Termination benefits - 0.2
------ -----
- 2.0
=============================================================== =====
As highlighted in note 26, key management are contracted with a related company, CSC Management Services Limited, and the salary and related costs are shown in the accounts of CSC Management Services Limited.
32. Related party transactions
Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation for the Group.
Group
Transactions between the Group and related companies are shown below:
Nature of 2011 2010
Related company transaction GBPm GBPm
Liberty International Group Interest receivable 2.3 2.2
Treasury Limited Interest payable 31.1 36.2
Company
Transactions between the parent company and its subsidiaries and related companies are shown below:
Nature of 2011 2010
Subsidiary transaction GBPm GBPm
CSC Bromley Limited Interest receivable 2.6 2.1
CSC Harlequin Limited Interest receivable 16.3 14.9
CSC Lakeside Limited Interest receivable 21.4 20.7
CSC Metrocentre Limited Interest receivable 20.1 18.0
CSC Potteries Limited Interest receivable - 2.6
WRP Management Limited Interest receivable 0.5 0.3
Whitesun Limited Interest receivable 0.2 0.1
Xscape Braehead Partnership Interest receivable 0.6 0.5
Braehead Glasgow Limited Interest payable 0.8 2.1
Braehead Park Estates Limited Interest payable 1.1 0.9
CSC Properties Limited Interest payable 44.9 42.1
The Metrocentre Partnership Interest payable 3.1 3.4
CSC Uxbridge (Jersey) Limited Interest payable - 1.0
Dividend receivable - 66.0
Braehead Glasgow Limited Dividend receivable - 10.0
Braehead Park Investments Limited Dividend receivable - 2.8
Nature of 2011 2010
Related company transaction GBPm GBPm
Liberty International Group Interest receivable 2.3 2.2
Treasury Limited Interest payable 31.1 36.2
Group
Balances outstanding between the Group and related companies are shown below:
Amounts owed Amounts owed
by related to related
companies companies
2011 2010 2011 2010
Related company GBPm GBPm GBPm GBPm
Capital Shopping Centres Group
PLC - - (2.2) (5.1)
Liberty International Group
Treasury Limited - - (711.8) (921.3)
CSC Payments Limited 5.0 -
CSC Potteries Limited - - (4.1) -
CSC Trafford Centre Group (UK)
Limited 2.5 - - -
Company
Significant balances outstanding between the parent company and its subsidiaries and related companies are shown below:
Amounts owed Amounts owed
by subsidiary to subsidiary
2011 2010 2011 2010
Subsidiary GBPm GBPm GBPm GBPm
Belside Limited 135.7 134.8 - -
Braehead Glasgow Limited - - (5.4) (8.1)
Braehead Park Estates Limited - - (18.6) (17.8)
Broadway Retail Leisure Limited 11.1 10.9 - -
Chapelfield LP Limited - - (10.1) (14.0)
Chelmsford Property Investments
Limited - 2.6 -
Cribbs Causeway JV Limited - - (7.4) (5.9)
CSC Braehead Leisure Limited 8.1 7.9 - -
CSC Bromley Limited 44.1 37.3 - -
CSC Chapelfield Residential Limited 7.3 7.3 - -
CSC Enterprises Limited 2.8 2.8 - -
CSC Harlequin Limited 273.0 252.2 - -
CSC Lakeside Limited 350.3 346.8 - -
CSC Metrocentre Limited 331.5 304.7 - -
CSC Nottingham Investments Limited 76.4 - -
CSC Potteries Limited - 174.2 - -
CSC Properties Investment Limited - - - (48.1)
CSC Properties Limited - - (752.3) (702.1)
CSC The Hayes Limited 387.9 383.7 - -
CSC Uxbridge (Jersey) Limited 2.2 5.3 - -
Curley Limited 201.6 201.2 - -
Manchester JV Limited - - (10.5) (8.2)
Westgate Oxford Investments Limited - 16.9 (7.1) -
Whitesun Limited 2.6 2.4 - -
WRP Management Limited 8.0 8.1 - -
Xscape Braehead Partnership 9.9 9.4 - -
Amounts owed Amounts owed
by related to related
company company
Related company 2011 2010 2011 2010
GBPm GBPm GBPm GBPm
Capital Shopping Centres Group
PLC - - (2.2) (5.1)
Liberty International Group
Treasury Limited - - (824.8) (921.0)
CSC Potteries Limited - - (4.1) -
CSC Trafford Centre Group (UK)
Limited 2.5 - - -
33. Contingent liabilities
As at 31 December 2011, the Group has no material contingent liabilities other than those arising in the normal course of business.
34. Ultimate parent company
The immediate and ultimate parent company is Capital Shopping Centres Group PLC, a company incorporated and registered in England and Wales, copies of whose consolidated financial statements may be obtained from the Company Secretary, 40 Broadway, London, SW1H 0BT.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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