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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Safeland | LSE:SAF | London | Ordinary Share | GB0007667008 | ORD 5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 37.50 | 30.00 | 45.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMSAF
RNS Number : 3522Y
Safeland PLC
21 August 2018
The information contained within this announcement is deemed by the Group to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
Safeland plc
("Safeland", the "Company" or the "Group")
Final Results for the Year Ended 31 March 2018
Managing Director's Statement
Key Achievements
I am pleased to report on another successful year, albeit that the year to 31 March 2018 saw lower levels of turnover and profit after tax, but higher operating profit and profit before tax, than the preceding year.
We paid a final dividend of 1p per share in respect of the year ended 31 March 2017, which was paid during this financial year. We are pleased to continue the trend of distributing a share of profits to our shareholders by recommending the payment of a final dividend of 1p per share which, subject to shareholders' approval at the Company's Annual General Meeting, will be payable on 28 September 2018 to shareholders on the register of members at close of business on 24 August 2018.
During the year, the Group sold its residual interest in two properties in London and purchased and sold a mixed-use property asset in London NW9. These disposals generated total revenues of GBP2.8m. Towards the end of the year, work completed on two projects - the redevelopment of a former hotel in Muswell Hill into 18 apartments and the construction of 3 residential properties near our head office in London N2; both projects were fully let within the first quarter of this financial year.
Planning permission was obtained for the building of a mixed residential and commercial development in London N2, and work commenced on a conversion to apartments of a property in London N10.
Financial Results
Group revenue for the year to 31 March 2018 of GBP2.9 million comprised sales of properties, rental income and management fees. However, it was below the GBP13.0 million reported for the preceding year, in which there was more activity.
Gross profit of GBP0.3 million was below the GBP2.5 million for the year to 31 March 2017, but operating profit increased from GBP1.9 million to GBP2.7 million, reflecting the gain on revaluation of investment properties, including those transferred this year from trading stock. However, it is worth noting that we are extremely selective on transactions until the outlook on the economy in general and the property sector specifically, show signs of strengthening.
As a result of the completion of the two projects mentioned above, both properties were transferred from stock into investment properties and were valued at a gain to the Group of GBP3.8 million. As a result, trading stock has decreased in value from GBP9.3 million at 31 March 2017 to GBP5.0 million at 31 March 2018. The Statement of Financial Position shows gearing at 31 March 2018 of 45%, which is consistent with the long term gearing ratio of the Group (31 March 2017: 12%).
I am pleased to report that our net asset value (NAV) rose from GBP19.9 million (equivalent to 129 pence per share) at 31 March 2017, to GBP21.6 million (equivalent to 145 pence per share) at 31 March 2018. This is an 11.6% increase, albeit that for the third consecutive year there were fewer shares in issue at the year-end than 12 months previously, as a result of buybacks and cancellation of shares.
Continuing the theme of purchasing our own shares - in the prior year, there had been two transactions totalling 193,000 shares - in the year to 31 March 2018, we made 8 buy-backs, totalling 460,000 shares. The directors continue to consider that the acquisition and cancellation of these shares as appropriate if it enhances the value of the remaining shares in issue.
Due to the small increase in the share price over the year, total shareholder returns for the year increased by 6.4% (2017: 2.7% decrease).
After the year end, we successfully negotiated a new GBP16.5 million revolving credit facility with Lloyds Bank, secured on certain assets owned by the Group.
Outlook
I repeat the statement in 2017's full-year results that the market appears to us to be constrained by an economic outlook which in turn is affected by political conditions at home, in the EU, and worldwide. I believe that this has created a cautious environment, verging on stagnation which may continue for some time.
Whilst we will continue to seek out value adding opportunities, the generally negative environment with little current opportunity suggests that it would be prudent for the Board to review the Company's cost base, including the value of maintaining the Company's AIM quotation. A further announcement will be made in due course.
Larry Lipman
Managing Director
20 August 2018
Enquiries
Safeland plc +44 (0) 20 8815 1600 Larry Lipman, Managing Director Stockdale Securities (Nominated Adviser and Broker) Tom Griffiths +44 (0) 20 7601 6100
For more information visit: www.safeland.co.uk
Condensed Consolidated Income Statement
Year Ended 31 March 2018
Hot Features
Premium
Note 2018 2017
GBP'000 GBP'000
Revenue
Continuing 3 2,900 12,695
Discontinued 3 - 277
-------- --------
2,900 12,972
Cost of sales (2,595) (10,517)
-------- --------
Gross profit 305 2,455
Administrative expenses (1,577) (1,721)
Gain on revaluation of investment properties 3,833 459
Profit on disposal of investment property 74 694
Dividend from investment 11 5
Share of results of associate 25 31
-------- --------
Operating profit 2,671 1,923
-------- --------
Operating profit - continuing 2,671 1,877
Operating profit - discontinued - 46
-------- --------
2,671 1,923
-------- --------
Finance income 148 554
Finance costs (426) (448)
-------- --------
Profit before tax 2,393 2,029
Tax (247) 293
-------- --------
Profit for the financial year attributable
to owners of the parent company 2,146 2,322
======== ========
Basic earnings per share 4 14.25p 15.27p
Diluted earnings per share 4 7.88p 8.35p
Condensed Consolidated Statement of Comprehensive Income
Year ended 31 March 2018
2018 2017
GBP'000 GBP'000
Profit for the year 2,146 2,322
-------- --------
Other comprehensive income
Fair value losses on available-for-sale
financial assets (104) (30)
Other comprehensive income for the
year, net of tax (104) (30)
-------- --------
Total comprehensive income for the
year
attributable to owners of the parent
company 2,042 2,292
======== ========
Condensed Consolidated Statement of Financial Position
31 March 2018
Note 2018 2017
GBP'000 GBP'000
Non-current assets
Property, plant and equipment 1,789 1,885
Investment properties 6 14,762 1,182
Investment in associate 127 127
Available-for-sale investments 698 802
Total non-current assets 17,376 3,996
-------- --------
Current assets
Trading properties 7 5,018 9,348
Trade and other receivables 8 9,238 9,209
Cash and cash equivalents 1,066 5,280
-------- --------
Total current assets 15,322 23,837
-------- --------
Total assets 32,698 27,833
-------- --------
Current liabilities
Bank loans and overdrafts 9 10,455 7,639
Trade and other payables 470 232
Corporation tax payable 140 -
-------- --------
Total current liabilities 11,065 7,871
-------- --------
Non-current liabilities
Bank loans - -
Deferred income tax liabilities 74 32
-------- --------
Total non-current liabilities 74 32
-------- --------
Total liabilities 11,139 7,903
-------- --------
Net assets 21,559 19,930
======== ========
Equity
Share capital 745 768
Share-based payment reserve 354 354
Investment revaluation reserve (186) (82)
Capital redemption reserve 98 75
Retained earnings 20,548 18,815
-------- --------
Total equity attributable to owners
of the parent company 21,559 19,930
======== ========
Condensed Consolidated Statement of Changes in Equity
31 March 2018
Share Capital Share-based Investment Retained Total
Capital redemption payment revaluation earnings equity
reserve reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ----------- ----------- ------------ --------- --------
Balance at 1
April 2016 778 65 354 (52) 16,601 17,746
-------- ----------- ----------- ------------ --------- --------
Comprehensive
income
Profit for the
year - - - - 2,322 2,322
Revaluation of
available-for-sale
investments - - - (30) - (30)
-------- ----------- ----------- ------------ --------- --------
Total comprehensive
income - - - (82) 2,322 2,292
-------- ----------- ----------- ------------ --------- --------
Transactions
with owners
Purchase of own
shares (10) 10 - - (108) (108)
-------- ----------- ----------- ------------ --------- --------
Total transactions
with owners (10) 10 - - (108) (108)
-------- ----------- ----------- ------------ --------- --------
Balance at 31
March 2017 768 75 354 (82) 18,815 19,930
-------- ----------- ----------- ------------ --------- --------
Comprehensive
income
Profit for the
year - - - - 2,146 2,146
Revaluation of
available-for-sale
investments - - - (104) - (104)
---- --- ----- ------ ------
Total comprehensive
income - - - (104) 2,146 2,042
---- --- ----- ------ ------
Transactions
with owners
Dividend paid - - - - (151) (151)
Purchase of own
shares (23) 23 - - (262) (262)
---- --- ----- ------ ------
Total transactions
with owners (23) 23 - - (413) (413)
---- --- ----- ------ ------
Balance at 31
March 2018 745 98 354 (186) 20,548 21,559
---- --- ----- ------ ------
Condensed Consolidated Statement of Cash Flows
Year ended 31 March 2018
2018 2017
GBP'000 GBP'000
Operating activities
Cash (outflow)/inflow from operations (6,274) 6,523
Interest paid (395) (406)
Corporation tax paid (65) (1,464)
-------- --------
Net cash (outflow)/inflow from operating activities (6,734) 4,653
-------- --------
Investing activities
Interest received 5 1
Purchase of property, plant and equipment (44) (143)
Other dividends received 36 31
Proceeds from sale of investment properties 72 1,094
Proceeds from sale of property, plant and equipment 79 94
-------- --------
Net cash generated from investing activities 148 1,077
-------- --------
Financing activities
Purchase of own share capital (262) (108)
Dividends paid to equity shareholders (151) -
New loans 2,785 2.001
Loan repayments - (5,331)
Net cash from/(used in) financing activities 2,372 (3,438)
-------- --------
Net (decrease)/increase in cash and cash equivalents (4,214) 2,292
Cash and cash equivalents at beginning of year 5,280 2,988
Cash and cash equivalents at end of year 1,066 5,280
======== ========
Notes
31 March 2018
1. Basis of preparation
On 20 August 2018, the Directors approved this announcement for publication. Copies of this announcement are available from the Company's registered office at 1a Kingsley Way, London, N2 0FW and on its website, www.safeland.co.uk. The Annual Report and Accounts will be sent to shareholders in due course and will be available on the Company's website, www.safeland.co.uk. The financial information presented above does not constitute statutory financial statements as defined by section 435 of the Companies Act 2006 for the year ended 31 March 2018. The financial information for the year ended 31 March 2017 has been derived from the Group's statutory accounts for that year, as filed with the Registrar of Companies.
The financial information for the year ended 31 March 2018 is derived from the statutory financial statements for that year, prepared under IFRS, upon which the auditors have reported. The audit report was unqualified, did not include references to matters to which the auditor drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. The statutory financial statements for the year ended 31 March 2018 will be delivered to the Registrar of Companies following the Company's Annual General Meeting.
The accounting policies applied in this announcement are consistent with those of the annual financial statements for the year ended 31 March 2017, as described in those annual financial statements.
2. Significant Accounting Policies
Revenue
Revenue is stated net of VAT and comprises rental income, proceeds from sales of trading properties, fees, commissions and other income.
Sales of trading properties are recognised on completion of a contract. This reflects the point of transfer of risk and rewards when trading property is sold.
Rental income from investment and trading properties leased out under operating leases is recognised in the Income Statement on a straight-line basis over the term of the lease. Contingent rents which comprise turnover rents are recognised as income in the periods in which they are earned. Rent reviews are recognised when such reviews have been agreed with tenants. Lease incentives are recognised as an integral part of the net consideration for the use of the property and amortised on a straight-line basis over the term of lease, or the period to the first tenant break, if shorter.
Hotel revenue comprised revenues from overnight hotel accommodation, banqueting facility hire and sales of food and beverages. All revenue was recognised when the service was provided. The hotel closed and ceased to trade in the prior year on 3 August 2016.
Other fees in relation to property management are recognised on a straight-line basis over the term of management contracts.
Investment properties
Investment properties are those properties that are held either to earn rental income or for capital appreciation or both. Investment properties are measured and stated at fair value in the statement of financial position. Valuation surpluses and deficits arising in the year are included in the consolidated income statement.
The gain or loss arising on the disposal of a property is determined as the difference between the sales proceeds and the fair value of the asset at the beginning of the period and is recognised in the consolidated income statement.
Investment properties developed by the Group are transferred from current assets at cost with the gain or loss on valuation being recorded in the consolidated income statement.
Investment properties may be freehold properties or leasehold properties. For leasehold properties that are classified as investment properties, the associated leasehold obligations, if material, are accounted for as finance lease obligations.
Trading properties
Properties held for development and resale are classified as trading properties and are shown at the lower of cost and net realisable value. Cost comprises purchase price, acquisition costs and direct expenditure.
3. Operational Segments
All activities are based in the United Kingdom.
The segmental information of the Group's results for the year ended 31 March 2018 was as follows:
Property Property Unallocated Total
trading & investment GBP'000 GBP'000
management GBP'000
GBP'000
----------- ------------ ------------ ---------
Revenue 2,850 50 - 2,900
Cost of sales (2,595) - - (2,595)
----------- ------------ ------------ ---------
Gross profit 255 50 - 305
Profit on disposal
of investment properties - 74 - 74
Gain on revaluation
of investment properties - 3,833 - 3,833
Share of profit of
associate 25 - - 25
Operating profit before
administration expense 280 3,957 - 4,237
Administrative expenses - - (1,577) (1,577)
Dividend from investments - - 11 11
Finance income - - 148 148
Finance costs - - (426) (426)
----------- ------------ ------------ ---------
Profit before tax 280 3,957 (1,844) 2,393
=========== ============ ============ =========
Property Property Unallocated Total
trading & investment GBP'000 GBP'000
management GBP'000
GBP'000
----------- ------------ ------------ ---------
Segment assets 15,081 14,762 2,855 32,698
Segment liabilities (3,072) (6,649) (1,418) (11,139)
----------- ------------ ------------ ---------
Net assets 12,009 8,113 1,437 21,559
----------- ------------ ------------ ---------
Capital expenditure - - 44 44
----------- ------------ ------------ ---------
Depreciation - - 79 79
----------- ------------ ------------ ---------
The segmental information of the Group's results for the year ended 31 March 2017 was as follows:
Property trading Property Unallocated(1) Total
& management investment GBP'000 GBP'000
GBP'000 GBP'000
----------------- ------------ --------------- -----------
Revenue 12,480 215 277 12,972
Cost of sales (10,286) - (231) (10,517)
----------------- ------------ --------------- -----------
Gross profit 2,194 215 46 2,455
Profit on disposal
of investment properties - 694 - 694
Gain on revaluation
of investment properties - 459 - 459
Share of profit
of associate 31 - 31
Operating profit
before administration
expense 2,225 1,368 46 3,639
Administrative expenses - - (1,721) (1721)
Dividends from investments - - 5 5
Finance income - - 554 554
Finance costs - - (448) (448)
----------------- ------------ --------------- -----------
Profit before tax 2,225 1,368 (1,564) 2,029
================= ============ =============== ===========
Property Property Unallocated(1) Total
trading & investment GBP'000 GBP'000
management GBP'000
GBP'000
---------------- ------------ --------------- ---------
Segment assets 18,583 1,182 8,068 27,833
Segment liabilities (7,639) - (264) (7,903)
---------------- ------------ --------------- ---------
Net assets 10,944 1,182 7,804 19,930
---------------- ------------ --------------- ---------
Capital expenditure - - 5 5
---------------- ------------ --------------- ---------
Depreciation - - 81 81
---------------- ------------ --------------- ---------
(1) The hotel business ceased to operate in the year ended 31 March 2017 with effect from 3 August 2016 and has been closed permanently. Its results for 2017 have been included within unallocated.
4. Earnings per Share
The calculation of the basic and diluted earnings per share is based on the following data:
2018 2017
GBP'000 GBP'000
Profit for the year attributable to equity
holders of the Company 2,146 2,322
======== ========
2018 2017
Number Number
Weighted average number of ordinary shares
for the purposes of basic earnings per share
(continued and discontinued) 15,042,243 15,555,095
Effect of dilutive potential ordinary shares 12,148,658 12,042,793
----------- -----------
Weighted average number of ordinary shares
for the purposes of diluted earnings per share 27,190,901 27,597,888
=========== ===========
5. Dividends
The Directors recommend the payment of a final dividend of 1 penny per share (2017: 1p), which, subject to shareholders' approval at the Company's Annual General Meeting, will be payable on 28 September 2018 to shareholders on the Company's register of members at the close of business on 24 August 2018. During the year, no interim dividend was paid (2017: nil pence per share).
6. Investment Properties
2018 2017
GBP'000 GBP'000
Fair value
At 1 April 1,182 1,123
Transfer from current properties 9,747 -
Disposal of properties in the year - (400)
Increase in fair value during the year 3,833 459
-------- --------
At 31 March 14,762 1,182
======== ========
The fair value of the investment properties at 31 March 2018 comprises freehold properties of GBP13,832,000 (2017: GBP457,000) and long leasehold properties of GBP930,000 (2017: GBP725,000). The leasehold and freehold investment property have been classified within level 3 of the fair value hierarchy (unobservable inputs). The transfer from current properties developed by the group was at cost.
The investment properties consist of residential property located in North London and have been valued by the Directors. The methodology to value these properties is to compare historical comparable market transactions less a percentage reduction to reflect the limitations of restrictive tenancies where appropriate. Based on valuations at 31 March 2018, if the percentage reduction was 5% higher or lower and all other variables were held constant, the Group's profit before tax would increase or decrease by 8.5%.
The Group has pledged investment properties with a carrying value of GBP14,762,000 (2017: GBP1,182,000) to secure banking facilities granted to the Group.
The fair value of the Group's investment properties at 31 March 2018 had been arrived at on the basis of market value as defined in the Apportionment and Valuation Manual of the Royal Institution of Chartered Surveyors.
The historical cost of investment properties included in the financial statements at 31 March 2018 is GBP10,578,000 (2017: GBP831,000) of which GBP10,035,000 (2017: GBP288,000) are freehold and GBP543,000 (2017: GBP543,000) are long leasehold properties.
7. Trading Properties
2018 2017
GBP'000 GBP'000
Properties for resale 5,018 9,348
======== ========
The Group has pledged properties for resale with carrying value of GBP5,012,000 (2017: GBP9,113,000) to secure banking facilities granted to the Group.
Properties for resale were reviewed for impairment as at 31 March 2018; the Directors are satisfied that no impairment is necessary.
Trading properties are properties acquired or developed and held for sale and are shown at the lower of cost or net realisable value. The cost of trading properties are those costs directly associated with the acquisition and development of a specific site. Net realisable value is the estimated selling price in the ordinary course of business less estimated costs to completion and the estimated costs necessary to make the sale.
8. Trade and Other Receivables
2018 2017
GBP'000 GBP'000
Trade receivables 5 80
Other receivables 9,208 9,122
Prepayments and accrued income 25 7
9,238 9,209
========= =========
The directors consider that the carrying amount of trade and other receivables is no less than their fair value. Of the other receivables, GBP9,200,000 (2017: GBP9,058,000) is deferred consideration on the sale of the Chandos Tennis Club. Although this was past due at the balance sheet date, this amount has not been impaired as the Group took possession of the properties after the year end (see note 10)
9. Bank Loans
2018 2017
GBP'000 GBP'000
Bank loans 10,455 7,670
Unamortised borrowing costs - (31)
--------- ---------
10,455 7,639
--------- ---------
There were no breaches of bank loan covenants as at 31 March 2018 or 31 March 2017.
All of the Group's bank loans and overdrafts disclosed above comprise borrowings in sterling.
The bank loans are secured on investment and trading properties owned by the Group totalling GBP19,744,000 (2017: GBP10,295,000).
The Group had undrawn committed borrowing facilities as at 31 March 2018 of GBP2,045,000 (2017: GBP4,830,000).
At 31 March 2018, the Group had a GBP12,500,000 (2017: GBP12,500,000) revolving credit facility with Lloyds Bank plc, secured on certain properties owned by the Group. The facility was based on LIBOR plus a fixed margin. The Group renewed the facility during April 2018 under similar terms as the original facility, but with a limit of GBP16,500,000. At 31 March 2018, a notional amount of the loan of GBP5,000,000 (2017: GBP5,000,000) was capped at 3%.
10. Post balance-sheet events
In April 2018 the Group negotiated a renewal of the Group's revolving credit facilities with its principal lender. This will provide the Group with a GBP16,500,000 facility through to December 2020.
During May 2018, four investment properties valued at GBP1,455,000 at 31 March 2018, were disposed of for a small profit.
During June 2018, the Group took possession of the four houses as part and final consideration on sale of the Chandos Tennis Club. The consideration payable for the sale in 2014 comprised GBP4.0 million in cash (which was received in 2014) and the balance was to be satisfied by way of transfer to Safeland of four detached houses (valued at the time by the Company's directors in aggregate at GBP9.2 million) in the completed development.
During the three months to June 2018, all 3 houses in the Edeleny Close development and all 18 apartments in the Raglan Hall development were let to third parties at a total annual rental of GBP525,000.
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.
END
FR QBLFLVVFZBBK
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August 21, 2018 02:00 ET (06:00 GMT)
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