Register for real-time alerts, custom portfolio, and market movers
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Circle Property Plc | LSE:CRC | London | Ordinary Share | JE00BYP0CK63 | ORD NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.50 | 3.00 | 4.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2022 to Apr 2025
TIDMCRC
RNS Number : 8215I
Circle Property PLC
07 December 2022
7 December 2022
Circle Property Plc
("Circle", the "Company" or the "Group")
Interim Results for the six months ended 30 September 2022
DIVESTMENT PROGRAMME CONTINUES
Circle Property Plc (AIM: CRC) is pleased to announce interim results for the six months ended 30 September 2022.
John Arnold, Chief Executive of Circle Property Plc, said:
"We continue to progress our divestment strategy with a view to returning the net proceeds to shareholders.
The more challenging macroeconomic backdrop impacted the broader property investment market after the period. This has meant our rate of sales has slowed in recent months from the expedited rate achieved earlier in the year and pricing has also been softer. Nevertheless, we are still able to divest assets successfully and remain steadfast in generating the best value possible for shareholders.
Circle is debt free following these well-timed asset disposals and still expects to make the first capital distribution to shareholders in Q1 2023."
Highlights
-- Approximately 60% of the property portfolio, by value, has been disposed of since the announcement of the divestment strategy in February 2022.
-- Proven track record of divesting assets at prices in excess of book valuations to extract maximum value, albeit not at historical premiums during the reported period due to the weakened property market.
-- The Group's loan facility was repaid in full in June 2022, leaving the Group debt free.
-- At the period end, the Group's cash balance was GBP21 million, ahead of an expected return of capital to shareholders in Q1 2023.
-- Unaudited net asset value ("NAV") of GBP2.73 per share as at 30 September 2022 (31 March 2022: GBP2.81; 30 September 2021: GBP2.74).
-- Asset management continues with the refurbishment of K3 Kents Hill, Milton Keynes. Due to the evolving requirements of the tenant, refurbishment costs have increased from approximately GBP2.2 million to approximately GBP2.7 million and completion is expected to take place in December 2022.
Post period end
-- On 6 October 2022, the Group completed the sale of Elizabeth House, Staines for a consideration of GBP3.5 million.
-- On 23 November 2022, the Group exchanged contracts for the sale of Somerset House, Birmingham for a consideration of GBP15.180 million. Completion is expected to take place by the end of February 2023.
-- The letting of K3, Kents Hill Business Park was completed and the sale at GBP4.5 million is expected to complete before the end of December 2022.
Outlook
-- Post period, the disposals below valuation and the issue of 918,793 Ordinary Shares to the Executives under the Company's LTIP announced in October 2022 (the "LTIP Shares"), has impacted the current estimated NAV per share. The issue of the LTIP Shares had a negative dilutive effect on the current estimated NAV of 9 pence per share, reducing it to GBP2.64.
-- In addition, due to challenging market conditions, the Board anticipates that by the end of the sales programme, the estimated NAV is expected to reduce further. Further announcements will be made as appropriate, as and when further disposals are made.
-- Confident in delivering further asset sales to maximise returns, albeit selling into a more difficult investment market.
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the UK version of the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of the European Union (Withdrawal) Act 2018, as amended and supplemented from time to time.
Hot Features
Premium
+44 (0)207 930
Circle Property Plc 8503
John Arnold, CEO
Edward Olins, COO
+44 (0) 207 397
Cenkos Securities 8900
Katy Birkin
Mark Connelly
George Lawson
+44 (0) 203 897
Radnor Capital Partners 1830
Joshua Cryer
Iain Daly
+44 (0) 203 757
Camarco 4992
Ginny Pulbrook
Rosie Driscoll
Toby Strong
About Circle Property Plc
Circle is not a Real Estate Investment Trust (REIT) and has historically actively recycled proceeds from asset sales into its refurbishment and redevelopment pipeline to generate attractive total returns. Since February 2022, the Group has embarked on an orderly break-up of the portfolio to return maximum value to shareholders.
Chief Executive's Statement
The property market reached record highs in certain sectors earlier in 2022. However, this has since reversed as a consequence of elevated inflation, market uncertainty, the war in Ukraine, the rising cost of capital and other macroeconomic challenges.
Although the property market has weakened considerably after the reported period, we are pleased that the majority of the properties were sold into a more receptive market earlier in the year. We moved quickly following the announcement of the divestment strategy, taking advantage of a buoyant market for regional offices, achieving prices in excess of book valuations. As a result, we expect the aggregate of all disposal prices to be in the region of 95% of the March 2022 valuations when regional office valuations were at their peak.
Disposals during the period included the completion of the sale of K1 & K2 at Kents Hill Business Park, Milton Keynes ("Kents Hill") in August 2022 at a price of GBP12.73 million, with a further payment of GBP4.5 million agreed for K3 following completion of the contracted letting to Kuehne+Nagel (subsequently let on 30 November 2022) and expected to complete by the end of December 2022. Moreover, Cheltenham House, Birmingham sold for GBP4.664 million (completed September 2022) and 720 Aztec West in Bristol sold for GBP2.52 million (completed May 2022).
The occupational market is challenging but our office portfolio has continued to benefit from workers returning to the workplace, with occupancy and usage high. Consequently, rent collection is no longer a topic as it was during the period of the pandemic, with rent collection at expected levels. The Group's active asset management approach has enabled us to capture demand, lease vacant space and deliver growth, at K3 Kents Hill, where we have added additional refurbishment capex in to meet the requirements of the incoming tenant.
As we further progress against our programme of asset disposals, the Board remains committed to maximising returns and delivering value to shareholders. Given the divestment strategy and plans for two returns of capital directly to shareholders, with the first expected in Q1 2023, the Board has resolved that there will be no interim dividend.
It is the Board's intention to liquidate all the remaining assets before the end of our current financial year, so long as there remains interested buyers at respectable pricing levels.
Condensed consolidated statement of comprehensive income
for the 6 months ended 30 September 2022
6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
Note (unaudited) (unaudited) (audited)
GBP GBP GBP
--------------------------------------- ----- -------------- -------------- ------------
Rental income 4 2,416,643 3,233,143 7,458,236
Other income 4 418,168 983,509 1,581,773
--------------------------------------- ----- -------------- -------------- ------------
2,834,811 4,216,652 9,040,009
Property expenses 5 (643,672) (1,219,063) (2,082,925)
Net rental income 2,191,139 2,997,589 6,957,084
Administrative expenses 6 (978,252) (944,649) (3,583,744)
Operating profit 1,212,887 2,052,940 3,373,340
(Loss)/gain on disposal of investment
properties (1,683,575) 599,446 2,070,908
(Loss)/gain on revaluation of
investment properties 11 (1,074,273) (1,300,804) 1,837,721
Operating (loss)/profit after revaluation
of investment properties (1,544,961) 1,351,582 7,281,969
Finance income 7 43,883 26 192
Finance costs 8 (444,191) (760,934) (1,488,907)
Net finance costs (400,308) (760,908) (1,488,715)
(Loss)/profit for the period/year
before taxation (1,945,269) 590,674 5,793,254
Taxation 9 446,383 (156,562) (1,425,337)
Total comprehensive (loss)/profit
for the period/year (1,498,886) 434,112 4,367,917
--------------------------------------- ----- -------------- -------------- ------------
(Loss)/earnings per share 10 (0.05) 0.02 0.15
--------------------------------------- ----- -------------- -------------- ------------
NAV per share 2.73 2.74 2.81
--------------------------------------- ----- -------------- -------------- ------------
There is no comprehensive income other than that included in the loss for the period. All of the loss for the period is attributable to the owners of the Company.
All items in the above statement derive from continuing operations.
Condensed consolidated statement of financial position
as at 30 September 2022
30 September 30 September 31 March
Note 2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ----- ------------- ------------- ------------
Non-current assets
Investment properties 11 27,496,279 99,243,539 32,399,476
Right of use assets 61,959 2,316 75,728
Property plant and equipment 54,344 52,940 49,025
Lease incentives and receivables 13 771,372 9,966,711 1,350,524
Deferred tax asset 564,030 1,191,464 406,612
---------------------------------- ----- ------------- ------------- ------------
28,947,984 110,456,970 34,281,365
Current assets
Investment properties 11 20,328,627 - 39,994,194
Lease incentives and receivables 13 3,859,460 2,731,180 3,858,790
Assets held for sale 12 6,400,000 20,000,000 2,200,000
Cash and cash equivalents 20,892,395 8,566,762 25,303,400
---------------------------------- ----- ------------- ------------- ------------
51,480,482 31,297,942 71,356,384
Total assets 80,428,466 141,754,912 105,637,749
---------------------------------- ----- ------------- ------------- ------------
Equity
Stated capital 42,542,179 42,542,179 42,542,179
Treasury share reserve 1,047,684 1,170,961 1,047,684
Retained earnings 33,570,840 33,866,695 36,060,113
---------------------------------- ----- ------------- ------------- ------------
Total equity 77,160,703 77,579,835 79,649,976
Non-current liabilities
Loan borrowings 14 - 60,249,656 -
Trade and other payables 15 1,247,814 - 1,055,871
Lease liabilities for right of
use assets 34,393 - 47,398
Deferred tax liability 540,353 379,226 923,046
---------------------------------- ----- ------------- ------------- ------------
1,822,560 60,628,882 2,026,315
Current liabilities
Trade and other payables 15 1,419,603 3,539,026 2,631,128
Loan borrowings 14 - - 21,305,537
Lease liabilities for right of
use assets 25,600 7,169 24,793
---------------------------------- ----- ------------- ------------- ------------
1,445,203 3,546,195 23,961,458
Total liabilities 3,267,763 64,175,077 25,987,773
---------------------------------- ----- ------------- ------------- ------------
Total liabilities and equity 80,428,466 141,754,912 105,637,749
---------------------------------- ----- ------------- ------------- ------------
The condensed consolidated interim financial statements were approved by the Board of Directors on 6 December 2022.
Condensed consolidated statement of changes in equity
for the 6 months ended 30 September 2021
Treasury Share-based
Stated share payment Retained
capital capital reserve earnings Total
GBP GBP GBP GBP GBP
----------------------- ----------- --------- ------------ ------------ ------------
As at 1 April 2021 42,162,178 380,001 1,047,684 33,814,453 77,404,316
Profit for the period - - - 1,184,112 1,184,112
Share-based payments - - 123,277 - 123,277
Dividends - - - (1,131,870) (1,131,870)
As at 30 September
2021 42,162,178 380,001 1,170,961 33,866,695 77,579,835
Loss for the period - - - 3,183,805 3,183,805
Share-based payments - - 314,618 - 314,618
Reclassification - - (437,895) - (437,895)
Dividends - - - (990,387) (990,387)
As at 31 March 2022 42,162,178 380,001 1,047,684 36,060,113 79,649,976
Loss for the period - - - (1,498,886) (1,498,886)
Dividends - - - (990,387) (990,387)
As at 30 September
2022 42,162,178 380,001 1,047,684 33,570,840 77,160,703
------------------------ ----------- --------- ------------ ------------ ------------
Condensed consolidated statement of cash flows
for the 6 months ended 30 September 2022
6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
--------------------------------------- -------------- -------------- -------------
Cash flows from operating activities
(Loss)/profit for the period before
taxation (1,945,269) 1,340,674 5,793,254
Adjustments for:
Finance income (43,883) (26) (192)
Finance expense 444,191 760,934 1,488,907
Depreciation 9,241 7,785 16,715
Amortisation of right of use assets 13,769 18,700 30,196
Loss/(gain) on revaluation of
investment properties 1,074,273 1,300,804 (1,837,721)
Loss/(gain) on disposal of investment
properties 1,683,575 (599,446) (2,070,908)
Gain on revaluation of assets
held for sale - (750,000) -
Share based payments - 123,277 437,895
(Increase)/decrease in trade and
other receivables (246,335) 412,560 (207,344)
(Decrease)/increase in trade and
other payables (762,424) (334,478) 17,065
Cash (used in)/from operating
activities 227,138 2,280,784 3,667,867
Interest paid (401,743) (655,725) (1,332,610)
Interest received 20,161 26 192
Taxation paid - - (480,779)
Net cash (used in)/from operating
activities (154,444) 1,625,085 1,854,670
---------------------------------------- -------------- -------------- -------------
Cash flows from investing activities
Cost of refurbishment of investment
properties (1,497,510) (1,084,488) (2,089,004)
Proceeds from disposal of investment
properties 19,866,425 3,436,621 61,009,583
Cost of additions of property
plant and equipment (14,561) (6,315) (11,330)
Net cash from investing activities 18,354,354 2,345,818 58,909,249
---------------------------------------- -------------- -------------- -------------
Cash flows from financing activities
Repayment of borrowings (21,480,656) (1,775,000) (40,819,344)
Payment of lease liabilities (14,430) (20,075) (41,722)
Dividends paid (990,387) (1,131,870) (2,122,257)
Net cash used in financing activities (22,485,473) (2,926,945) (42,983,323)
---------------------------------------- -------------- -------------- -------------
Net (decrease)/increase in cash
and cash equivalents (4,285,563) 1,043,958 17,780,596
Cash and cash equivalents at the
beginning of the period 25,303,400 7,522,804 7,522,804
---------------------------------------- -------------- -------------- -------------
Cash and cash equivalents at the
end of the period 21,017,837 8,566,762 25,303,400
---------------------------------------- -------------- -------------- -------------
Notes to the condensed consolidated interim financial statements
for the 6 months ended 30 September 2022
1 General information
These condensed consolidated interim financial statements are for Circle Property Plc ("the Company") and its subsidiary undertakings (together referred to as the "Group").
The Company's shares are admitted to trading on AIM, a market operated by the London Stock Exchange plc. The Company is domiciled and registered in Jersey, Channel Islands. The address of its registered office is 3rd Floor, IFC5, Castle Street, St Helier, Jersey, JE2 3BY.
The nature of the Company's operations and its principal activities are that of property investment in the UK.
2 Principal accounting policies
Basis of preparation
The condensed consolidated interim financial statements are prepared under the historical cost convention, on a basis other than going concern basis and in accordance with International Financial Reporting Standards and IFRIC interpretations adopted for use in the UK ("IFRS") and with those parts of the Companies (Jersey) Law, 1991 applicable to companies preparing their accounts under IFRS.
The condensed consolidated interim financial statements contained in this document do not constitute statutory accounts under Companies (Jersey) Law 1991. In the opinion of the directors, the condensed consolidated interim financial statements for this period fairly presents the financial position, result of operations and cash flows for this period.
The condensed consolidated interim financial statements have not been audited, nor have they been reviewed by the Company's auditors in accordance with the International Standard on Review Engagements 2410 issued by the Auditing Practices Board.
Statutory financial statements for the year ended 31 March 2022 were approved by the Board of Directors on 15 July 2022. The report of the auditors on those financial statements was unqualified, however, the report included an emphasis of matter on the non-going concern basis preparation of the Company.
Statement of compliance
The Interim Report includes the consolidated interim financial statements which have been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting'. The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 March 2022, which have been prepared in accordance with IFRS as adopted by the United Kingdom and applicable law.
Going concern
In February 2022, the Group provided an update on its future strategy whereby it would make targeted property sales, whilst investing in and actively managing the remainder of the property portfolio, over an extended period of two to three years. The proceeds of the future disposals were to be utilised to continue to reduce borrowings with the remaining proceeds to be returned to shareholders in an orderly and efficient manner.
Due to the Group's intention to pursue this revised strategy, the interim financial statements have been prepared on a basis other than going concern.
In preparing the financial statements on an alternate basis, the Board has continued to apply the requirements of IFRS taking into account that the Group is not intended to continue as a going concern in the foreseeable future.
This has resulted in a reclassification of investment properties and associated lease incentive assets that are expected to be disposed of in the period ending 30 September 2023 as current assets in accordance with IAS 1. There has been no impact on the measurement of assets and liabilities as at 30 September 2022. No additional provisions have been recognised as at 30 September 2022 in relation to the costs expected to be incurred in winding down the Group's operations.
The remainder of the property portfolio continues to be actively managed with strong rental collections and the timely recovery of any arrears. In assessing the Group's ability to continue operating, the Group's cash forecasts have been modelled based on the circumstances of each tenant on an individual basis and all envisaged development expenditure has been accounted for. Rental collections continue to be monitored on a monthly basis with payment plans agreed for the collection of overdue amounts.
New Standards adopted at 1 January 2022
There are no accounting pronouncements which have become effective from 1 January 2022 that have a significant impact on the Group's interim condensed consolidated financial statements.
Significant accounting policies
The accounting policies applied by the Group in these half-yearly results are the same as those applied by the Group in its consolidated financial information in its 2022 Annual Report and Accounts.
Areas of estimates and judgement
In preparing these condensed consolidated interim financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income, and expenses. Actual results may differ from these estimates.
The judgements, estimates and assumptions applied in the Group's consolidated interim financial statements, including the key sources of estimation uncertainty, were the same as those applied in the Group's last annual financial statements for the year ended 31 March 2022.
3 Operating segments
During the period the Group operated in one geographical segment, which is the United Kingdom, and one reporting segment, which is investment in commercial property. Therefore, no segmental reporting is required.
4 Revenue 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------- -------------- -------------- ----------
Rental income 2,223,900 3,337,533 6,904,275
Lease incentive adjustment 192,743 (104,390) 553,961
------------------------------ -------------- -------------- ----------
2,416,643 3,233,143 7,458,236
Insurance recovery 65,373 100,268 125,279
Service charge income 334,489 798,241 1,324,494
Other income 18,306 85,000 132,000
------------------------------ -------------- -------------- ----------
418,168 983,509 1,581,773
2,834,811 4,216,652 9,040,009
---------------------------- -------------- -------------- ----------
5 Property expenses 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- -------------- -------------- ----------
Property expenses 15,119 33,292 78,485
Property service charges 184,358 221,610 393,323
Property repairs and maintenance
costs - 28,753 28,753
Property insurance 60,305 75,048 146,483
Property rates 49,401 62,119 111,387
Recoverable service charge costs 334,489 798,241 1,324,494
643,672 1,219,063 2,082,925
---------------------------------- -------------- -------------- ----------
6 Administrative expenses 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
-------------------------------- -------------- -------------- ----------
Staff costs 515,224 506,001 2,167,519
Administration fees 150,563 153,200 308,302
Legal and professional fees 185,592 176,914 589,238
Audit fees 41,647 33,500 75,630
Accountancy fees 1,950 2,445 6,424
Rent, rates and other office
costs 7,689 9,113 10,786
Other overheads 52,577 36,991 72,941
Depreciation of tangible fixed
assets 9,241 7,785 16,715
Amortisation of right of use
assets 13,769 18,700 30,196
Waiver of rental arrears - - 200,000
Provision for doubtful debts - - 105,993
978,252 944,649 3,583,744
-------------------------------- -------------- -------------- ----------
7 Finance income 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------ -------------- -------------- ----------
Bank interest 43,883 26 192
43,883 26 192
------------------ -------------- -------------- ----------
8 Finance costs 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
--------------------------------- -------------- -------------- ----------
Loan interest 153,185 643,284 1,209,950
Loan commitment fees 25,100 17,739 71,949
Amortisation of lending costs 175,119 101,972 202,197
Interest on long-term incentive
payment 88,555 - 5,111
Interest on lease liabilities 2,232 (2,061) (300)
444,191 760,934 1,488,907
--------------------------------- -------------- -------------- ----------
9 Taxation 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- -------------- -------------- ----------
Current tax 93,729 159,356 99,459
Deferred tax (credit) / charge (540,112) (2,794) 433,958
Impairment of deferred tax asset - - 891,920
(446,383) 156,562 1,425,337
---------------------------------- -------------- -------------- ----------
Basic earnings per share has been calculated on profit after tax attributable to ordinary shareholders for the period (as shown on the condensed consolidated statement of comprehensive income) and the weighted average number of ordinary shares in issue during the period.
6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------------------- -------------- -------------- -----------
(Loss)/profit for the period (1,615,536) 434,112 4,367,917
------------------------------------------------ -------------- -------------- -----------
Weighted average number of shares (excluding
treasury shares) 28,296,762 28,296,762 28,296,792
----------------------------------------------- -------------- -------------- -----------
(Loss)/earnings per ordinary
share: (0.06) 0.02 0.15
------------------------------------------------ -------------- -------------- -----------
10 Diluted earnings per share 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------------------- -------------- -------------- -----------
(Loss)/profit for the period (1,615,536) 434,112 4,367,917
------------------------------------- -------------- -------------- -----------
Weighted average number of shares 29,183,396 29,322,398 29,183,396
------------------------------------- -------------- -------------- -----------
Profit/(loss) per ordinary share: (0.06) 0.01 0.15
------------------------------------- -------------- -------------- -----------
11 Investment properties 30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------------- ------------- ------------- -------------
Opening fair value per valuation
report 75,700,000 132,150,000 132,150,000
Cost of refurbishment of investment
properties 1,281,530 1,342,369 2,296,994
Disposal of investment properties (19,350,000) (2,837,175) (58,938,675)
(Loss)/gain on revaluation of
investment properties (1,074,273) (1,300,804) 1,837,721
Lease incentive amortisation 192,743 (104,390) 553,960
Reclassification of assets held
for sale (6,400,000) (19,250,000) (2,200,000)
Fair value of investment properties
per valuation report 50,350,000 110,000,000 75,700,000
-------------------------------------- ------------- ------------- -------------
Unamortised lease incentives (2,525,094) (10,756,461) (3,306,330)
Carrying value 47,824,906 99,243,539 72,393,670
--------------------------------------- ------------- ------------- -------------
Following the amendment of the basis of preparation of the financial statements, investment properties and the unamortised lease incentives thereon have been recognised as current and non-current assets dependent on the anticipated disposal date. At 30 September 2022, GBP29.25 million of the total value of the investment property of GBP50.35 million has been recognised as a current asset and GBP21.1 million has been recognised as a non-current asset.
At 30 September 2022, both K3, Kents Hill Park and Elizabeth House, are classified as held for sale given the properties meets IFRS 5 criteria (2021: 720 Aztec West).
The fair value of the Group's investment properties at 30 September 2022 has been arrived at on the basis of valuation carried out by Savills (UK) Limited. The valuation was carried out in accordance with the Practice Statements contained in the Appraisal and Valuation Standards as published by the RICS. In forming their opinion of the fair value, the independent valuer's had regard to the current best use of the property, its investment attributes, and recent comparable transactions. The valuation was carried out using the "All Risks Yield" method taking into consideration both sales and rental evidence and formulating the opinion of market value taking into account the properties' locations, specifications, and specific characteristics.
At 30 September 2022, the fair value of the Group's investment properties per the valuation report amounted to GBP50.35 million (2021: GBP110 million). The difference between the fair value of the investment properties per the valuation report and the fair value per the balance sheet of GBP2,525,094 (2021: GBP10,756,461) relates to unamortised lease incentives which are recorded in the financial statements within non-current and current assets.
The Group had pledged all of its investment properties to secure banking facilities granted to the Group as detailed in note 14. On 22 June 2022 the banking facilities were repaid and the security released.
12 Assets held for sale 30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
-------------------------------- ------------- ------------- ----------
Opening balance 2,200,000 - -
Reclassification of K3, Kents
Hill Park 2,900,000 - -
Reclassification of Elizabeth
House, London Road 3,500,000 - -
Reclassification of One Castle
Park, Bristol - 19,250,000 -
Reclassification of 720 Aztec
West - - 2,200,000
Disposal of 720 Aztec West (2,200,000) - -
Gain on revaluation of asset
s held for sale - 750,000 -
Closing balance 6,400,000 20,000,000 2,200,000
---------------------------------- ------------- ------------- ----------
On 11 August 2022, the Group exchanged contracts on the sale of Elizabeth House, London Road to Map Commercial Properties Limited for a consideration of GBP3.5 million. Completion took place on 6 October 2022.
On 19 August 2022, the Group exchanged contracts on the sale of Kents Hill, Milton Keynes (buildings K1, K2 and K3) to Corum XL, for a consideration of GBP17.23 million. The sale of buildings K1 and K2 completed simultaneously on exchange at a sale price of GBP12.73 million. Completion of the sale of building K3, at a sale price of GBP4.5 million, is expected to take place prior to the end of the calendar year, following the completion of the refurbishment currently underway.
13 Lease incentives and receivables 30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------------- ------------- ------------- ----------
Non-current
Lease incentives 771,372 9,966,711 1,350,524
--------------------------------------- ------------- ------------- ----------
Current
Lease incentives 1,753,721 789,750 1,955,807
Amounts due from property agents 15,369 51,586 77,491
Tenant deposits 225,351 272,662 225,351
VAT 125,442 - -
Amounts due from tenants 1,257,606 1,379,759 1,426,867
Provision for doubtful debts (105,993) - (105,993)
Other receivables 587,964 237,423 279,267
3,859,460 2,731,180 3,858,790
------------------------------------- ------------- ------------- ----------
14 Loan borrowings 30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------- ------------- ------------- -------------
Brought forward 21,305,537 61,922,684 61,922,684
Loan repayments (21,480,656) (1,775,000) (40,819,344)
Amortisation of lending costs 175,119 101,972 202,197
Total borrowings - 60,249,656 21,305,537
--------------------------------- ------------- ------------- -------------
The Group was party to a revolving facility, with NatWest and HSBC. The facility was a GBP60 million revolving facility with an accordion option of up to GBP40 million. The facility had a four year term, repayable on 13 February 2023.
The facility was secured by a first and only legal charge over the Group's investment properties, an assignment of rental income, charges over specified bank accounts of the Group and a floating charge granted over all assets of the Group.
The revolving facility was fully repaid by the Group on 22 June 2022.
15 Trade and other payables 30 September 30 September 31 March
2022 2021 2022
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------------- ------------- ------------- ----------
Non-current
Long-term incentive payment 1,247,814 - 1,055,871
------------------------------- ------------- ------------- ----------
Current
Trade payables 16,246 47,200 166,312
Property improvement costs 19,443 285,314 235,423
Wages and salaries 27,755 26,223 352,723
Deferred income 896,120 1,752,940 1,210,499
Rental deposit accounts 225,351 272,662 225,351
Finance costs - 279,467 223,458
VAT - 195,485 25,307
Valuation fee 9,600 13,200 24,000
Audit fees 39,000 33,500 75,630
Administration fees - - 66
Current taxation 186,088 633,035 92,359
1,419,603 3,539,026 2,631,128
----------------------------- ------------- ------------- ----------
16 Subsequent events
On 6 October 2022, the Group completed the sale of Elizabeth House, Staines for a consideration of GBP3.5 million.
On 11 October 2022, John Arnold and Edward Olins exercised their rights to acquire, for nil consideration, 466,649 and 419,984 ordinary shares of no par value ("Ordinary Shares") respectively. The issue of 886,633 Ordinary Shares was satisfied by 255,034 Ordinary Shares which were held in treasury and the issue of a further 631,599 new Ordinary Shares. Following the exercise, the Company had a total of 29,183,395 Ordinary Shares in issue.
On 14 October 2022, John Arnold was issued a further 32,160 Ordinary Shares in respect of the accrued dividend attributable to his Long Term Incentive Plan shares issued on 11 October 2022. Edward Olins chose to receive the accrued dividend in cash. Following the issue, the Company has a total of 29,215,555 Ordinary Shares in issue.
On 23 November 2022, the Group exchanged contracts for the sale of Somerset House, Birmingham for a consideration of GBP15.18 million. Completion is expected to take place by the end of February 2023.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
END
IR VQLFBLLLFFBB
(END) Dow Jones Newswires
December 07, 2022 02:00 ET (07:00 GMT)
1 Year Circle Property Chart |
1 Month Circle Property Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
