RNS Number:5436Q
Country & Metropolitan PLC
06 October 2003
6 October 2003
Country & Metropolitan Plc
Preliminary Results for the period ended 30 June 2003
Country & Metropolitan Plc, a housebuilder and leading developer of brownfield
regeneration projects, announces preliminary results for the shorter 10 month
period to 30 June 2003.
Financial Highlights:
* Turnover up 94% to #62.3m (2002: #32.3m)
* Gross profit up 95% to #17.5m (2002: #9.0m)
* Pre tax profit* up 72% to #6.85m (2002: #3.99m)
* Earnings per share* up 56% to 25.91p (2002: 16.56p)
* Total dividend up 20% to 3.30p (2002: 2.75p)
* Before Goodwill amortisation
Operational Highlights:
* Record combined forward sales as at 30 September 2003 of #45.3m
* Leeds city centre development "Blue" at Granary Wharf is 50% sold
* Resolution to grant planning consent received at Havelock Hospital,
Sunderland for 250 units
* The North West region is growing steadily
* 31 of the 42 units sold at Jackson's Warehouse in Manchester with healthy
margins.
* Annual rental income now stands at #890,000 per annum
Commenting on the prospects for the Group Chairman David Laing, said,
Since the acquisition of NorthCountry our geographic spread has increased
significantly as has our product range and skill set. As a result the enlarged
Group is well positioned for further growth, especially in the current climate
of low inflation and low interest rates, which has provided much needed
stability in the housing market.
By maintaining our strong record in land acquisition and developing a diverse
product portfolio we continued to achieve record off plan orders with forward
sales at 30 September 2003 totalling #45.3m.
I remain confident that Country & Metropolitan will deliver another impressive
set of results in the current year.
For further information:
Country & Metropolitan Plc Tel: 01895 824111
Stephen Wicks, Chief Executive
Buchanan Communications Ltd Tel: 020 7466 5000
Mark Edwards
J M Finn & Co Tel: 020 7860 6324
Leslie Kent
Chairman's Statement
Country & Metropolitan has delivered another set of outstanding results in what
is a shortened ten month period to 30 June 2003. Profit before tax and
amortisation of goodwill rose to #6.85m. This record result confirms the Board's
confidence expressed in the interim statement and I am positive that the Group
is well placed to continue such progress.
Results and dividend
The Group changed its financial year to 30 June following the acquisition of
NorthCountry Homes Group Limited ("NorthCountry") and during this shortened ten
month period to 30 June 2003 it has achieved an increase in pre-tax profits
before amortisation of goodwill of 72% to #6.85m (2002: #3.99m). Operating
profit before amortisation of goodwill rose by 76% to #8.94m (2002: #5.10m),
which resulted in basic earnings per share before amortisation of goodwill
increasing by 56% to 25.91p (2002: 16.56p) per share. As a consequence, I am
pleased to report that the Board is proposing to increase the final dividend by
21.5% to 2.60p (2002: 2.14p) per share bringing the total for the period to
3.30p (2002: 2.75p). The final dividend will be paid on 9 January 2004 to
shareholders on the register on 12 December 2003.
The Group's net gearing has reduced from 150% to 139% at the period end with
interest cover increasing from 2.86 to a comfortable level at 4.28 which is also
cushioned by the current annual rental income of #890,000. Net asset value per
share has increased to 123.5p per share (2002: 102.7p) representing
shareholders' funds of #23.3m (2002: #19.4m).
Operating review
As expressed last year and at the interim stage, the Group has withdrawn from
the more difficult luxury homes market in the South East with only two such
units available for sale. We are focused primarily to provide homes that are
priced at levels which are affordable in the relevant markets and have commenced
some new initiatives in the South East to achieve this objective. These
initiatives are in line with the government's aspirations and also serve the
requirements of local authorities.
However, an exception to the above is our ownership in what we believe to be one
of the most prime sites in London, opposite Hampton Court Palace, with a direct
frontage to the River Thames. We have now signed heads of agreement with
Network Rail for a major mixed use development of the adjoining Hampton Court
Station and work is progressing for a joint planning application to be submitted
following formal agreement being concluded with Network Rail.
The Southern Region has sold all the units at the development in Moseley,
Birmingham and has acquired further sites in Wolverhampton suitable for
regeneration. The development in Moseley has won the Birmingham Post & Mail
Award for Best Starter Home.
Our city centre development known as "Blue" at Granary Wharf in Leeds is 50%
sold with further units now released for sale. Construction is expected to be
completed in summer 2004. Development of 43 units at our site at Poole Hospital
in Middlesborough has commenced and we have secured 9 reservations off plan at
prices in excess of budget. A planning application has been submitted for the
conversion of approximately 240,000 square feet of listed buildings, 368,000
square feet of new build homes and 150,000 square feet of commercial space at
High Royds Hospital in Menston near Leeds and consent is expected later in the
year. The Group has a 50% interest in this project via a joint venture company.
The North West region is growing steadily and has sold 31 of the 42 units at
Jackson's Warehouse in Manchester with healthy margins and has secured
approximately 300 plots for future development.
NorthCountry's five regions operating in the North of England have had a
successful period with 542 units sold during the ten months to 30 June 2003. It
has now secured a resolution to grant planning consent for approximately 250
units at Havelock Hospital in Sunderland and construction is expected to
commence shortly. NorthCountry is focused on increasing its land bank suitable
for the first time buyer market and is continuing to achieve this at very
competitive prices. One of its key objectives is to increase the number of
outlets which has been thwarted by the nationwide frustration in the planning
system. I am pleased to report that to support the continuing growth of
NorthCountry, the management team led by Jolyon Harrison has been strengthened
by the appointment of Steve Murray as managing director. Steve Murray has 20
years experience in the house building sector and was an executive director of
Beazer Group Plc for 6 years.
The Group currently owns or controls 4,200 plots of which 1,790 plots have
planning consent. In addition it owns or controls strategic land representing
potential for a further 1,800 units.
Board Appointment
This year the Group also announced the appointment of Terry Roydon as
Non-Executive Director. I would like to take this opportunity of formally
welcoming Terry to the Board.
Terry has over 35 years experience in the house building industry and has held a
number of board positions in the building sector, most notably as Chief
Executive of Prowting PLC and more recently as Chairman of Banner Homes Limited.
During his time at Prowting, the Company floated on the London Stock Market and
generated an annual turnover of #150m producing 1,600 homes annually.
Corporate activity
We sold part of our interest in Headway PLC to one of our substantial
shareholders, Allied Commercial Exporters Limited and as a result our holding
has reduced from 16.9% to 8.6%. We continue to hold our interest as a trade
investment.
Prospects
Since the acquisition of NorthCountry our geographic spread has increased
significantly as has our product range and skill set. As a result the enlarged
Group is well positioned for further growth, especially in the current climate
of low inflation and low interest rates, which has provided much needed
stability in the housing market.
By developing a diverse product portfolio and maintaining our strong track
record in land acquisition we continued to achieve a record forward order book
with contracted sales of #26.7m and forward reservations of #18.6m as at 30
September 2003.
I remain confident that Country & Metropolitan will deliver another impressive
set of results in the current year. On behalf of the Board, I should like to
thank all members of staff for their immense effort and support for the Group.
David Laing
Chairman
6 October 2003
COUNTRY & METROPOLITAN PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Period ended Year ended
30 June 31 August
2003 2002
#'000 #'000
Turnover 62,797 32,290
Cost of sales (45,248) (23,288)
Gross profit 17,549 9,002
Net operating expenses (8,816) (4,051)
Share of profit of associated 206 120
undertaking
Operating profit before goodwill 8,939 5,071
amortisation
Goodwill amortisation (445) (45)
Operating profit 8,494 5,026
Profit on disposal of investment - 1,058
Interest receivable and similar 40 136
income
Interest payable and similar (2,130) (2,279)
charges
Profit on ordinary activities before taxation 6,404 3,941
Tax on profit on ordinary (1,952) (1,198)
activities
Profit for the financial period 4,452 2,743
Dividends (623) (549)
Retained profit for the period 3,829 2,194
Basic earnings per share - before goodwill 25.91p 16.56p
amortisation - after goodwill amortisation 23.55p 16.29p
Diluted earnings per share - before goodwill amortisation 25.32p 16.36p
- after goodwill amortisation 23.02p 16.10p
Dividend per share 3.30p 2.75p
COUNTRY & METROPOLITAN PLC
CONSOLIDATED BALANCE SHEET
30 June 31 August
2003 2002
#'000 #'000
Fixed assets
Tangible assets 13,838 15,521
Investments 2,087 387
Intangible assets 4,853 5,298
20,778 21,206
Current assets
Stocks 40,104 31,938
Debtors - amounts falling due after more than one year - 50
- amounts falling due within one year 18,042 15,666
Cash at bank and in hand 4,896 8,326
63,042 55,980
Creditors: amounts falling due within one year (46,402) (42,235)
Net current assets 16,640 13,745
Total assets less current 37,418 34,951
liabilities
Creditors: amounts falling due after more than one year (14,043) (15,532)
Provision for liabilities and charges (33) (12)
Net assets 23,342 19,407
Share capital and reserves
Called up share 189 189
capital
Share premium account 9,940 9,940
Revaluation reserves 2,393 2,316
Profit and loss 10,820 6,962
account
Shareholder's Funds
Equity interests 23,342 19,407
COUNTRY & METROPOLITAN PLC
CASH FLOW STATEMENT
Period ended Year ended
30 June 31 August
2003 2002
#'000 #'000
Net cash inflow from operating activities 2,426 2,154
Returns on investments and servicing of finance
Interest received 59 17
Interest paid (2,641) (1,977)
Dividends received 182 164
Net cash outflow from returns on investments and
servicing of finance (2,400) (1,796)
Taxation
Corporation tax paid (2,891) (407)
Capital expenditure and financial investment
Purchase of tangible fixed (477) (382)
assets
Proceeds from sale of tangible fixed assets 2,329 203
Proceeds from sale of 944 7,842
investments
Purchase of investments (2,551) (559)
Net cash inflow for capital expenditure and
financial investment 245 7,104
Acquisitions and disposals
Acquisition of businesses and subsidiaries - (11,065)
Net cash balances acquired with subsidiaries - 13,940
Net cash inflow from acquisitions and disposals - 2,875
Equity dividends paid (520) (371)
Cash (outflow)/inflow before financing (3,140) 9,559
Financing
Repayment of short-term loans (unsecured) - (25)
New secured loans 1,000 1,900
Repayment of secured loans (1,998) (3,796)
Repayment of capital element of finance lease rentals (288) (370)
Repayment of loan stock (250) (250)
Bank loans received 22,977 15,078
Bank loans repaid (21,664) (13,354)
Net cash outflow from financing (223) (817)
(Decrease)/increase in cash (3,363) 8,742
COUNTRY & METROPOLITAN PLC
Notes to the Preliminary Announcement
Basis of preparation
The audited accounts for the period ended 30 June 2003 have been prepared on the
basis of the Group's accounting policies. All comparatives are for the year
ended 31 August 2002.
The financial information presented above does not constitute full accounts
within the meaning of section 240 of the Companies Act 1985. Statutory accounts
for the period ended 30 June 2003 have been reported on by the Group's auditors
and will be distributed to shareholders and filed with the Registrar of
Companies in due course.
Dividends
Period ended Year ended
30 June 31 August
2003 2002
#'000 #'000
Interim equity dividend paid of 0.70p (2002:0.61p) per ordinary share 132 131
Final equity dividend proposed of 2.60p (2002:2.14p) per ordinary share 491 418
623 549
Earnings per share
The calculations of the basic and diluted earnings per share figures are based
on the following:
Period ended Year ended
30 June 31 August
2003 2002
#'000 #'000
Profit on ordinary activities after tax 4,452 2,743
Amortisation of goodwill 445 45
Profit on ordinary activities before goodwill amortisation and after tax 4,897 2,788
'000 '000
Weighted average number of shares in issue during the year used in the
calculation of basic earnings per share
18,901 16,836
Dilutive effect of options treated as exercisable at the year end 437 206
Weighted average number of shares used in the calculation of diluted earnings
per share 19,338 17,042
Basic earnings per share
- before goodwill amortisation 25.91p 16.56p
- after goodwill amortisation 23.55p 16.29p
Diluted earnings per share
- before goodwill amortisation 25.32p 16.36p
- after goodwill amortisation 23.02p 16.10p
This information is provided by RNS
The company news service from the London Stock Exchange
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