FLETCHER KING PLC — Earnings Release 2014

Jul 15, 2014

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RNS Number : 2841M

Fletcher King PLC

15 July 2014

FLETCHER KING PLC

Preliminary Results for the Year Ending 30th April 2014

Highlights

·   Revenue for the year of  £3.653m (2013: £3.031m)

·   Profit before tax of £711,000 (2013: £292,000)

·   Profit after tax of £542,000 (2013: £227,000)

·   Basic and diluted earnings per share of 5.89p (2013: 2.46p)

·   Final dividend of 2.25p per share. An interim dividend of 0.75p per share was paid and therefore the total ordinary dividend for the year will be 3.0p per share (2013: 1.50p)

Commenting on the results, David Fletcher, chairman of Fletcher King plc said:

"We have had an excellent year and it will be a hard task to match the performance in the coming year but we have some good business in the pipeline.

We are hopeful of picking up further Asset Management work this year and our SHIPS investors have indicated an appetite for further investments if we can find the stock.

As always I must pay tribute to our talented and hardworking team and to all our loyal clients without whom we would have no business."

END

For further information, please call:

David Fletcher/ Peter Bailey, Fletcher King           020 7493 8400

James Caithie, Cairn Financial Advisers LLP           020 7148 7900

CHAIRMAN'S STATEMENT

Results

Revenue for the year was £3.65m (2013: £3.03m) with profit before tax of £711,000 (2013: £292,000)

The board is proposing a final dividend of 2.25p per share (2013: 0.75p). The final dividend is subject to shareholder approval at the AGM and will be paid on 25 September 2014 to those shareholders on the register at close of business on 29 August 2014.  With the interim of 0.75p per share (2013: 0.75p) already paid, the total ordinary dividend for the year will amount to 3.0p per share (2013: 1.5p).

The board considers the results for the year to be highly satisfactory.

The Commercial Property Market

The commercial property market has continued its improvement during the second half of our year.

The investment market in London and the south east continues to be very strong.  Investors looking for higher returns are extending their purchasing into most major cities with multi-let industrial buildings and high street shops being most in favour.

Provincial offices, in all but a very few centres, continue to be difficult to sell or let. 

Tenant demand outside London and the south east remains patchy but the industrial market continues to be active.  Selective high streets are now attracting tenants as are offices in some of the regional centres.

Central London continues to be a strong market for lettings and investment demand.

Business Overview

Investment transactions have been excellent in the second half.  We enjoyed a number of notable successes including the largest sale in the history of the firm of an office block on the Old Street roundabout for £110m.

Our "SHIPS" funds have enjoyed a successful year and the return on our cash invested together with fees and carried interests have made a significant contribution to performance.  Both the Basinghall Street and St Swithins Lane buildings were sold during the year providing returns to investors of 11% per annum and 20% per annum respectively.

A further acquisition for "SHIPS" was made in December with the purchase of a multi-let office building in Leadenhall Street adjacent to the "Cheesegrater" for circa £9m.  The common parts and three floors of this building are currently being refurbished.  We continue to look for similar situations.

The investment side of our business has started the new year with some good sale and purchase instructions but it will be a challenge to match this year's performance.

Fund Management continues to perform well and its regular quarterly fee income is a valuable contribution to performance.

The same can be said for Asset Management which had an excellent year with new business added.

Rating had a very difficult year and continues to be affected by the unacceptably slow progress the Valuation Office is making in settling outstanding appeals. It is hoped that the huge backlog will start to be agreed and our fee income in this area will grow again. 

In my Interim Statement I reported an increase in valuations work and this trend has continued into the second half.

Outlook

We have had an excellent year and it will be a hard task to match the performance in the coming year.  We have some good business in the pipeline but the higher margin transaction business requires not only hard work but also often relies on factors outside our control falling into place.

We are hopeful of picking up further Asset Management work this year and our SHIPS investors have indicated an appetite for further investments if we can find the stock.

As always I must pay tribute to our talented and hardworking team and to all our loyal clients without whom we would have no business.

David Fletcher

Chairman

15 July 2014

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the year ended 30 April 2014

	Note	2014	2013
		£000	£000
Revenue		3,653	3,031
Employee benefits expense		(2,017)	(1,641)
Depreciation expense		(44)	(43)
Other operating expenses		(1,083)	(1,085)
Operating profit		509	262
Profit on disposal of available for sale investments		174	-
Income from investments		13	11
Finance income		15	19
Profit before taxation		711	292
Taxation		(169)	(65)
Profit for the year		542	227
Other comprehensive income for the year, net of tax		-	-
Total comprehensive income for the year attributable to equity shareholders		542	227
Basic and diluted earnings per share	3	5.89p	2.46p

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

as at 30 April 2014

	2014	2013
	£000	£000
Assets
Non-current assets
Property, plant and equipment	112	141
Available-for-sale investments	750	500
Deferred tax assets	18	63
	880	704
Current assets
Trade and other receivables	1,247	1,462
Cash and cash equivalents	3,314	2,571
	4,561	4,033
Total assets	5,441	4,737
Liabilities
Current liabilities
Trade and other payables	702	810
Current taxation liabilities	123	53
Other creditors	887	549
	1,712	1,412
Total liabilities	1,712	1,412
Shareholders' equity
Share capital	921	921
Share premium	140	140
Profit and Loss reserve	2,668	2,264
Total shareholders' equity	3,729	3,325
Total equity and liabilities	5,441	4,737

CONSOLIDATED STATEMENT OF CASH FLOWS

for the year ended 30 April 2014

	2014	2013
	£000	£000
Cash flows from operating activities
Profit before taxation from continuing operations	711	292
Adjustments for:
Depreciation expense	44	43
Profit on disposal of available for sale investments	(174)	-
Income from investments	(13)	(11)
Finance income	(15)	(19)
Cash flows from operating activities before movement in working capital		305
553
Decrease/(increase) in trade and other receivables	215	(570)
Increase in trade and other payables	230	207
Cash generated from/(absorbed by) operations	998	(58)
Taxation paid	(54)	(71)
Net cash flows from operating activities	944	(129)
Cash flows from investing activities
Purchase of fixed assets	(15)	(4)
Purchase of investments	(750)	-
Sale of investments	674	-
Finance income	15	19
Income from investments	13	11
Net cash flows from investing activities	(63)	26
Cash flows from financing activities
Dividends paid to shareholders	(138)	(138)
Net cash flows from financing activities	(138)	(138)
Net increase/(decrease) in cash and cash equivalents	743	(241)
Cash and cash equivalents at start of year	2,571	2,812
Cash and cash equivalents at end of year	3,314	2,571

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 30 April 2014

	Note	Share capital	Share premium	Profit and loss reserve	TOTAL EQUITY
		£000	£000	£000	£000
Balance at 1 May 2012		921	140	2,175	3,236
Total comprehensive income for the year		-	-	227	227
Equity dividends paid	2	-	-	(138)	(138)
Balance at 30 April 2013		921	140	2,264	3,325
Total comprehensive income for the year		-	-	542	542
Equity dividends paid	2	-	-	(138)	(138)
Balance at 30 April 2014		921	140	2,668	3,729

NOTES

1. Basis of preparation

The financial information set out above, which has been prepared on the basis of the accounting policies as set out in the prior year's accounts, does not comprise the company's statutory financial statements for the year ended 30 April 2014.  While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs) as adopted by the European Union, this announcement does not itself contain sufficient information to comply with IFRSs. Statutory financial statements for the previous financial year ended 30 April 2013 have been delivered to the Registrar of Companies. The auditors' report on those financial statements was unqualified and did not contain any statement under section 498(2) or (3) of the Companies Act 2006 and did not include references to any matters to which the auditor drew attention by way of emphasis.  The statutory accounts for the year ended 30 April 2014 have not yet been delivered to the Registrar of Companies, nor have the auditors yet reported on them.

2.  Dividends

Year ended 30 April	2014	2013
	£000	£000
Equity dividends on ordinary shares:
Declared and paid during year
Ordinary final dividend for the year ended 30 April 2013: 0.75p per share (2012:  0.75p)	69	69
Interim dividend for the year ended 30 April 2014: 0.75p  per share (2013: 0.75p)	69	69
	138	138
Proposed ordinary final dividend for the year ended 30 April 2014: 0.75p per share	207

3. Earnings per share

	2014 No	2013 No
Weighted average number of shares for basic and diluted earnings per share	9,209,779	9,209,779
	£000	£000
Earnings for basic and diluted earnings per share	542	227
Basic and diluted earnings per share	5.89p	2.46p

This information is provided by RNS

The company news service from the London Stock Exchange

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