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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Sutton Harbour Group Plc | LSE:SUH | London | Ordinary Share | GB0008659202 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 11.00 | 10.00 | 12.00 | 11.00 | 11.00 | 11.00 | 0.00 | 07:42:30 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Services, Nec | 8.16M | -2.04M | -0.0142 | -7.75 | 15.72M |
From Apr 2022 to Apr 2024
TIDMSUH
RNS Number : 0396T
Sutton Harbour Group PLC
20 July 2022
20 July 2022
SUTTON HARBOUR GROUP PLC (the "Group")
Results for the year ended 31 March 2022
Sutton Harbour Group plc ("Sutton Harbour", "the Company"), the AIM listed owner and operator of Sutton Harbour in Plymouth and specialist in waterfront regeneration projects and operation of waterfront real estate, marinas and Plymouth Fisheries, announces audited results for the year ended 31 March 2022.
Highlights
-- Net asset value up to GBP56.211m (43.3p per share), from GBP47.153m (40.6p per share).
-- Record trading year for the marinas with near capacity occupancy during year ended 31 March 2022 and maintained at 98% occupancy as of July 2022.
-- Investment Property occupancy rate of 89% at 31 March 2022 (97% at 31 March 2021). One building under refurbishment for three new tenants.
-- Strong recovery of parking revenues since summer 2021 and improving trend in 2022.
-- The first new development project at Sutton Harbour in a decade, Harbour Arch Quay, under construction and due for completion in Spring 2023.
-- Updated planning consent and s106 agreement for the 170 apartment building at Sugar quay secured.
Financial Highlights
Hot Features
Premium
Note 2022 2021
Adjusted Profit/(loss) before * GBP0.366m (GBP0.162m)
tax
----------------- --------------------- -----------------------
Net financing costs GBP0.789m GBP0.753m
----------------- --------------------- -----------------------
Net assets GBP56.2m GBP47.2m
----------------- --------------------- -----------------------
Net asset per share 43.3p 40.6p
--------------------- -----------------------
Valuation of property portfolio ** GBP54.3m GBP47.3m
----------------- --------------------- -----------------------
Year-end net debt GBP24.4m GBP26.9m
--------------------- -----------------------
*Before accounting for fair value adjustments to property asset valuation.
**Comprises investment and owner occupied portfolios.
Excludes land held as development inventory.
Valuation as at 31 March 2022.
Philip Beinhaker, Executive Chairman, commented:
"The resilience of the Group's property asset portfolio is shown in the valuation uplift. The strong asset base and annuity incomes provide a secure platform from which the Company has been able to restart property construction and develop a new pipeline of consented projects to follow. In time, the profits and investment revenues achieved by new developments will enable the Company the flexibility to reduce its borrowings. The Group celebrates the 175(th) anniversary of its core subsidiary this year and the stated strategic objectives provide a long term plan for the Group's future success."
For further information, please contact
Sutton Harbour Group plc Philip Beinhaker - Executive Chairman Corey Beinhaker - Chief Operating Officer Natasha Gadsdon - Finance Director 01752 204186 Strand Hanson Ltd (Nomad and Broker) James Dance Richard Johnson 020 7409 3494
Introduction
I am pleased to report on a successful year's results for the year ended 31 March 2022.
-- The year's trading performance reflects the overall resilience of the mix of business activities and restoration of full operations following the Lockdowns imposed by the UK Government throughout the previous trading year. As a result, the Group has achieved record earnings from its marina and car parking trading businesses and a 22.6% uplift in the valuation of the owner occupied asset portfolio.
-- The broad mix of tenants occupying the Group's investment properties and focus on the destination leisure property has protected the Group from void rates associated with other sectors. The Group maintained its property occupancy rate at 89% and is currently converting the space vacated by Edinburgh Woollen Mill into three units for new national covenant tenants, at materially improved GBP/sq ft rental rates.
-- Contract and financing preparations made during the previous year enabled the Group to press ahead with the construction of the Harbour Arch Quay development, the first new build by the Group in almost a decade, which started in February 2022.
-- The Group has secured an updated unanimous planning consent for the 170 apartment Sugar Quay development and agreement to the s106 agreement by the Local Authority.
-- To maintain progress with the development programme, the Company raised GBP3.417m net from the issue of 14 million new ordinary shares in August 2021. This equity issue also allowed the purchase of certain development sites adjacent at Sutton Road, Plymouth.
Results and Financial Position
The adjusted profit before taxation for the year was GBP0.366m (2021: GBP0.162m loss before taxation) which excludes non-cash fair value adjustments. In this financial year these adjustments relate to property asset valuation, undertaken by external valuers as at 31 March 2022. The profit before taxation for the year under review as per the consolidated income statement, inclusive of the aforementioned adjustments, was GBP0.561m (2021: GBP2.373m loss). The financial impact of the recovery from the Covid-19 pandemic is evident in the Gross Profit which is up by GBP0.586m to GBP2.348m in the year to 31 March 2022 (year to 31 March 2021: GBP1.762m).
Net debt (including lease liabilities) decreased to GBP24.408m as at 31 March 2022 from GBP26.874m at 31 March 2021, a fall of GBP2.466m. The net proceeds of GBP3.417m from the new equity raise by way of Open Offer in August 2021 were partly used for the pre-construction costs of development projects and the purchase of land at Sutton Road, Plymouth. The increase in development property inventory, including the aforementioned site acquisition, was GBP2.586m during the year.
Gearing (net debt: net assets) as at 31 March 2022 stood at 43.4% (2021: 57.0%). Net finance costs of GBP0.789m in the year (2021: GBP0.753m) are stated after capitalisation of interest of GBP0.343m (2021: GBP0.138m).
As at 31 March 2022, net assets were GBP56.211m (2021: GBP47.153m), a net asset value of 43.3p per ordinary share (2021: 40.6p per ordinary share). The movement includes the valuation of the Group's property assets which gave rise to an overall valuation surplus of GBP7.208m, as reconciled in the table below, of which a GBP0.380m surplus relates to the investment property portfolio and a net GBP6.828m surplus relates to the owner-occupied properties. The valuation surplus' follow further improvement in trading performance and the restoration of car parks activity after the end of the Lockdowns. The ongoing weaker level of trading at Plymouth Fisheries has informed the valuer's lower overall Fisheries asset value.
Valuation Surplus/(Deficit) Accounting*
Owner Occupied
Portfolio
(GBP0.185m) Fair valuation adjustment recorded in
* Fisheries the Income Statement as no revaluation
reserve available to absorb the deficit
GBP5.526m Credited to the Revaluation Reserve in
* Marinas the Balance Sheet
GBP1.487m Credited to the Revaluation Reserve in
* Car Parks the Balance Sheet
---------------------------- -----------------------------------------
Investment Property GBP0.380m Fair valuation adjustment recorded in
Portfolio the Income Statement
---------------------------- -----------------------------------------
TOTAL GBP7.208m
---------------------------- -----------------------------------------
Financing
During the year the Company issued 14 million new ordinary shares each at 25p and raised GBP3.417m after costs pursuant to an Open Offer. A loan from a private finance lender, which was used to purchase land in December 2020, was repaid after the year end and secured assets were unencumbered. Funds to repay this loan were made available by way of two unsecured loans from major shareholders at a lower rate of interest and on more flexible terms.
The full general banking facility with Nat West reduced from GBP27m to GBP26.9m during the year after a repayment was made from the proceeds of a minor investment property, Unit 1 Penrose House. After the year end the temporary GBP2m Covid support facility expired reducing the full committed facility to GBP24.9m. This facility expires in December 2023 and the board is actively considering whether to elect for a twelve month extension, which is allowed for in the facility agreement, or to enter into a new facility.
In accordance with the Dividend Policy, the board does not recommend payment of a dividend on the year's results in order to preserve headroom in the bank facility. The Group regards itself as an asset-based investment with its opportunities to reduce bank debt and realise value vested in the success of future development projects.
Directors and Staff
There have been no Board changes during the year. Headcount as at 31 March 2022 was 32 (31 March 2021: 31).
Operations Report
Marine
Sutton Harbour Marina and King Point Marina have enjoyed the busiest ever season with overall annual berth sales up by 20.3% and overall occupancy up to 98% by 31 March 2022 (92% by 31 March 2021). Overall berthing revenue, including visitor berthing across both marinas was up by GBP0.334m compared to the previous year, with no berthing rate increases. The new season has started strongly with more early bookings than usual, as available berthing along the South Coast of England has become scarcer. The outlook for strong revenue growth is encouraging after berthing rates were increased from 1 April 2022. Some changes were made to berthing configuration over the Winter and opportunities to maximise use of the water space are under review for creation of additional berths in the future. Three new positions have been created in the marina team to allow the Company to maintain a high level of customer service to a growing clientele.
Trading at Plymouth Fisheries has returned to a level close to the pre-pandemic period, although competition from other local ports and a declining local fleet continue to lower the performance of the port. Against a backdrop of rising fuel prices, which makes it increasingly difficult for fishers to make profitable trips to sea, the Company is working with suppliers to try to improve fuel buying prices and to pass savings on to customers. The Company's long-standing Harbour Master, Pete Bromley, retired in December 2021 and he has been successfully replaced by Mark Veale.
Starting in Autumn 2022, the Environment Agency will embark on a six-month programme to replace the cills of the Sutton Harbour lock. These works are necessary to ensure the proper working of the lock, a flood defence for Plymouth, and flood protection for a least a decade to come. This will result in restrictions to harbour users at certain times when passage through the lock will be constrained. A comprehensive communications programme has been organised to provide real time information to harbour users such that activities of the fishing industry, marina and public continue with minimal disruption. The Group is arranging for interim alternatives to facilitate some of the landing of fish at a nearby location which can then be transported to the Plymouth Fisheries complex for auction, processing and distribution, as is currently the case with c. 50% fish which arrives at the Plymouth Fisheries auction by road. This approach integrates the lessons learned from the similar major works that were completed some 13 years ago on the lock gates.
Real Estate and Car Parking
As at 31 March 2022 tenant occupancy across the Company's portfolio of real estate assets stood at 89% (31 March 2021: 97%). The Company supported some tenants through the Covid crisis with extended time to pay. These deferred rents were almost all cleared by 31 March 2022 and with the exception of two tenant failures, Edinburgh Woollen Mill and a gym operator, tenants restored normal operations during the year under review, many benefiting from improved footfall around Sutton Harbour. At the heart of the Sutton Harbour and Barbican area, the Old Barbican (fish) Market, is undergoing refurbishment and is due to open during summer 2022 with three new national covenant tenants.
After a slow start in April and May 2021, as visitors to the area increased, the revenue from car parking returned to the previous peak trading level recorded before the pandemic. The resumption of local events in Summer 2022, high marina occupancy and continued popularity of UK based tourism are conditions which are expected to underpin trading performance in the current financial year.
Regeneration
Sutton Harbour
The 14 apartment building known as Harbour Arch Quay located on the north eastern quay of Sutton Harbour is currently under construction with completion currently due in Spring 2023. The agency and digital marketing campaigns are in place and to date reservations for five apartments, including one of the penthouses, all at full asking price, have been received. Contracts are currently with lawyers pending exchange. The development is being financed by a GBP5m development loan from Atelier Finance and partly by the Group.
The Group has secured planning consent and s106 agreement for the updated plans for the 170 apartment Sugar Quay building. This will be a landmark 20 storey building on the eastern quay of Sutton Harbour. During the forthcoming year, the Company will prepare pre-construction work and source financing for this major new development. The intention is to start the building by mid-2023 with completion to follow some 30 months later.
The Group has continued with planning work for the future development of the Sutton Road site, opening and extending the eastern side of the Harbour and linking with Plymouth city centre and residential communities to the east of Gdynia Way. The original plans are now being refined following the purchase during the year of a small adjacent site which will enable improved road access and site layout. The Group is working on a wider masterplan for a comprehensive housing led regeneration of the east of Sutton Harbour area and has engaged regularly with the Local Planning Authority and potential partners.
The Plymouth Fisheries complex is now 27 years old and the Group recognises, as does the industry and Plymouth City Council, that modernisation of the facility would support the future of fishing in Plymouth and improve the port's competitive position. Redevelopment of the facility would require state support in the form of fishery industry and other grants and the Company is working, together with the local authority, on planning applications and grant submissions.
Former Airport Site
In 2019, when the new Local plan was agreed, a safeguard of a maximum five years was supported by Government Planning inspectors. More than three of the five years have now passed and the Company has continued to refine a masterplan for the alternative use of the 113 acre brownfield site. The Company's masterplan illustrates a mixed use development to accommodate various types of housing, institutional uses, business uses and areas of green space providing links to integrate with established surrounding neighbourhoods and institutions.
Financial Outlook
The Company has emerged from the pandemic period with trading results and asset valuation showing resilience and growth recovery. Like most businesses, emerging inflationary conditions are beginning to bite. In order to retain and attract good quality personnel the Company has needed to increase pay and in some roles by more than 10%. The Company is a major consumer of electricity to power the Sutton Lock gates, ice making and chilling plant at Plymouth Fisheries and lighting required for a large estate. Boilers across company premises are gas powered although consumption is less significant. The current power contracts expire in September 2022, whereafter the Company will experience a sharp increase. Much of this consumption is recharged to tenants and berth-holders, however the Company will need to raise the prices it charges for some of its services. The Company has already installed power efficient lighting at some locations, upgraded fisheries boilers and modernised fisheries plant to assist with consumption efficiency. Other costs are expected to increase in line with general inflation.
With interest rises to date and the pressure to control inflation with further interest rate rises, the Company will incur higher interest rate costs in the coming year. Each additional 1% in bank base rate will cost an additional c. GBP263,000 per annum based on average draw on the general banking facility. At the present time, the Group has not entered into any interest rate swap agreements to manage exposure to rising rates due to their high cost, however this a matter for close and monthly review by the board. The development loan for Harbour Arch Quay and the major shareholders' loan incur interest at fixed rates.
Summary
The Company has a unique mix of trading businesses concentrated around Sutton Harbour, a strongly supported visitor destination. Post Covid, the trading businesses have recovered and continues to improve, providing a growing cash inflow to the Company. The resilience of the property asset portfolio is shown in the valuation uplift. The strong asset base and annuity incomes provide a secure platform from which the Company has been able to restart property construction and develop a new pipeline of consented projects to follow. In time, the profits and investment revenues achieved by new developments will enable the Company the flexibility to reduce its borrowings. The Group celebrates the 175(th) anniversary of its core subsidiary this year and the stated strategic objectives provide a long term plan for the Group's future success.
Philip Beinhaker
EXECUTIVE CHAIRMAN
19 July 2022
Consolidated Income Statement for
the year ended 31 March 2022
2022 2021
GBP000 GBP000
Revenue 7,194 5,400
Cost of sales (4,846) (3,638)
Gross profit 2,348 1,762
------------ ------------
Fair value adjustments on investment properties and fixed assets 195 (2,211)
Administrative expenses (1,193) (1,171)
Operating profit/ (loss) 1,350 (1,620)
------------ ------------
Finance income - -
Finance costs (789) (753)
------------ ------------
Net finance costs (789) (753)
------------ ------------
Profit/(loss) before tax from continuing operations 561 (2,373)
Taxation ( charge)/ credit on (l oss) /profit from continuing operations (820) 198
------------ ------------
(Loss) for the year from continuing operations (259) (2,175)
------------ ------------
(Loss) for the year attributable to owners of the parent (259) (2,175)
============ ============
Basic and diluted earnings/(loss) per share
from continuing operations
Diluted earnings/(loss) per share (0.20p) (1.88p)
From continuing operations (0.20p) (1.88p)
Consolidated Statement of Other Comprehensive Income for
the year ended 31 March 2022
2022 2021
GBP000 GBP000
(L oss) for the year (259) (2,175)
Items that will not be reclassified subsequently to profit or loss:
Revaluation of property, plant and equipment 7,016 3,245
Deferred tax in respect of property revaluation (1,116) -
Items that may be reclassified subsequently to profit or loss:
Effective portion of changes in fair value of cash flow hedges - -
Other comprehensive income for the year, net of tax 5,900 3,245
------------ ------------
Total comprehensive income for the year attributable to owners of the parent 5,641 1,070
============ ============
Consolidated Balance Sheets
As at 31 March 2022
2022 2021
GBP000 GBP000
Non-current assets
Property, plant and equipment 36,398 29,766
Investment property 18,195 17,845
Inventories 13,216 12,962
67,809 60,573
------------ ------------
Current assets
Inventories 18,734 16,359
Trade and other receivables 1,810 2,396
Tax recoverable 9 6
Cash and cash equivalents 970 928
21,523 19,689
------------ ------------
Total assets 89,332 80,262
------------ ------------
Current liabilities
Other Loans 2,275 -
Trade and other payables 1,880 1,730
Lease liabilities 165 141
Deferred income 2,225 1,819
Provisions - 56
6,545 3,746
------------ ------------
Non-current liabilities
Bank loans 22,863 27,475
Lease liabilities 75 186
Deferred government grants 646 646
Deferred tax liabilities 2,992 1,056
Provisions - -
26,576 29,363
------------ ------------
Total liabilities 33,121 33,109
------------ ------------
Net assets 56,211 47,153
============ ============
Issued capital and reserves attributable
to owners of the parent
Share capital 16,406 16,266
Share premium 13,972 10,695
Other reserves 22,180 16,280
Retained earnings 3,653 3,912
Total equity 56,211 47,153
============ ============
Consolidated Statement
of Changes
in Equity
For the year ended 31
March 2022
Share Share Revaluation Merger Hedging Retained Total
capital premium reserve reserve reserve earnings equity
------------Other reserves------------
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------- -------- ---------------- ----------- ----------- --------- -------
Balance at 1 April
2020 16,266 10,695 9,164 3,871 - 6,087 46,083
Comprehensive income
Loss for the year - - - - - (2,175) (2,175)
Other comprehensive
income
Revaluation of property,
plant and equipment - - 3,245 - - - 3,245
Total comprehensive
income - - 3,245 - - (2,175) 1,070
-------- -------- ---------------- ----------- ----------- --------- -------
Balance at 1 April
2021 16,266 10,695 12,409 3,871 - 3,912 47,153
Comprehensive income
Loss for the year - - - - - (259) (259)
Other comprehensive
income
Share issue 140 3,277 3,417
Revaluation of property,
plant and equipment - - 7,016 - - - 7,016
Deferred tax on revaluation (1,116) (1,116)
Total other comprehensive
income 140 3,277 5,900 - - (259) 9,058
-------- -------- ---------------- ----------- ----------- --------- -------
Total balance at 31
March 2022 16,406 13,972 18,309 3,871 - 3,653 56,211
======== ======== ================ =========== =========== ========= =======
Consolidated Cash Flow Statement
For the year ended 31 March 2022
2022 2021
GBP000 GBP000
------- ------------
Cash generated/(used) from total operating
activities 59 (2,536)
Cash flows from investing activities
Net expenditure on investment property (52) (10)
Expenditure on property, plant and equipment (196) (161)
Proceeds from disposal 262 -
Cash generated/ (used) in investing activities 14 (171)
------- ------------
Cash flows from financing activities
Proceeds from issue of share capital 3,417 -
Interest paid (1,033) (754)
Loan (repaid)/drawdown (2,337) 3,225
Lease finance (paid)/received 62 378
Cash payments of lease liabilities (148) (142)
Grants received 8 136
Net cash (used)/ generated from financing
activities (31) 2,843
------- ------------
Net increase in cash and cash equivalents 42 136
Cash and cash equivalents at beginning of the
year 928 792
Cash and cash equivalents at end of the year 970 928
------- ------------
Reconciliation of financing activities for the year ended 31 March 2022
Cash
2022 flow 2021 Cash flow 202 0
GBP000 GBP000 GBP000 GBP000 GBP000
------- --------- ------- ---------- -------
Bank loans 22,800 ( 2,400) 25,200 950 24,250
Other loans 2,338 63 2,275 2,275 -
------- --------- ------- ---------- -------
Lease liabilities 2 40 ( 87) 327 236 91
------- --------- ------- ---------- -------
Long term debt 25,378 ( 2,424) 27,802 3,461 24,341
------- --------- ------- ---------- -------
Segment results
For the year ended 31 March 2022
Real
Marine Estate Car Parking Regeneration Total
GBP000 GBP000 GBP000 GBP000 GBP000
------- -------- ------------ ------------- --------
Revenue 4,771 1,427 736 260 7,194
Segmental Operating
Profit before
Fair value adjustment
and unallocated
expenses 1,199 922 389 (162) 2,348
Fair value adjustment
on investment
properties and
fixed assets (185) 380 - - 195
------- -------- ------------ ------------- --------
2,543
Unallocated:
Administrative
expenses (1,193)
Operating profit 1,350
Financial income
Financial expense (789)
--------
Profit before
tax from continuing
activities 561
Taxation (820)
--------
Loss for the
year from continuing
operations (259)
--------
Depreciation
charge
Marine 335
Car Parking 40
Administration 17
----
392
----
Year ended 31 Real
March 2021 Marine Estate Car Parking Regeneration Total
GBP000 GBP000 GBP000 GBP000 GBP000
-------- -------- ------------ ------------- ----------------
Revenue 3,509 1,542 349 - 5,400
Gross profit
prior to non-recurring
items 770 1,020 110 (138) 1,762
Fair value adjustment
on investment
properties and
fixed assets (1,061) (1,150) - - (2,211)
-------- -------- ------------ ------------- ----------------
(449)
Unallocated:
Administrative
expenses (1,171)
Operating loss (1,620)
Finance income -
Finance expenses (753)
----------------
Loss before tax
from continuing
activities (2,373)
Taxation 198
----------------
Loss for the year from continuing operations (2,175)
Depreciation
charge
Marine 336
Car Parking 31
Administration 32
----
399
----
Notes to the Consolidated Financial Statements
1. General Accounting Policies
Basis of preparation
The results for the year to 31 March 2022 have been extracted from the audited consolidated financial statements, which are expected to be published by mid-August 2022.
The financial information set out above does not constitute the Company's statutory accounts for the years to 31 March 2022 or 2021 but is derived from those accounts. Statutory accounts for the year ended 31 March 2021 were delivered to the Registrar of Companies following the Annual General Meeting on 1 October 2021 and the statutory accounts for 2022 are expected to be published on the Group's website (www.suttonharbourholdings.co.uk) shortly, posted to shareholders at least 21 days ahead of the Annual General Meeting ("AGM") to be held on 14 September 2022 and, after approval at the AGM, delivered to the Registrar of Companies.
The auditor, PKF Francis Clark, has reported on the accounts for the year ended 31 March 2022; their report includes a reference to the valuation of Plymouth City Airport (former airport site) to which the auditors drew attention by way of emphasis of matter without qualifying their report.
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