RNS Number:5007A
Hurlingham PLC
28 March 2006

HURLINGHAM PLC



28 March 2006

Results for the year ended 30 September 2005


Chairman's statement


I am pleased to present the Results of the Group for the year ended 30th
September 2005.  My report comments on the activities and results for the year,
but as there have been significant events and decisions taken by the Board since
the year end, I have also commented on those matters below.


Results


Group Profit and loss account


A significant deterioration in the trading performance of the Group's travel
division due to the terrorist bombs in London and Istanbul during the last
quarter of the year to 30th September 2005 has led to increased losses for the
year then ended. Group losses from continuing operations for the year amounted
to #536,000 (2004: #26,000)  after allowing for an exceptional charge of
#379,000, relating to the write-off of goodwill referred to below and before net
interest payable of #133,000 (2004: #150,000).  Continuing trading losses from
the travel division during the first half of the current year have led to the
Board considering that in view of the increased volatility of the travel
industry, the Group is insufficiently capitalised to be able to assume the level
of risk necessary to generate significant shareholder value from this division.
The Board has therefore decided to dispose of or close its travel interests.
The net assets of the travel division primarily comprised goodwill, with a book
value, after the current year's depreciation, of #379,000 and normal trade
debtors and creditors.  The Board has therefore made full provision for this
intangible asset in these accounts, resulting in a retained loss on ordinary
activities for the year of #669,000 (2004: loss #163,000).



Group subsidiaries



Custom Flights Limited



Although Custom Flights Limited increased turnover to #6.9m (2004: #1.1m), the
damage to margins in the last quarter of the year referred to above, resulted in
a loss from continuing operations before taxation and interest of #120,000
(2004: profit #8,000).



Custom Tours Limited



Sales at Custom Tours Limited, the Group's hotel booking company, declined to
#265,000 (#346,000) and the loss on ordinary activities increased to #158,000
after allowing for an exceptional write down of goodwill amounting to #76,000
(2004: loss #85,000).



Bettagrade Limited



Turnover at the Group's hotel in Perth increased to #1,088,000 (2004:
#1,016,000) and operating profit increased to #225,000 (2004: #204,000).





Group Balance sheet and shareholders funds



Despite the losses incurred by the travel division, the Group's hotel has
continued to trade well.  This asset has increased in value significantly since
it was last valued in January 2004 and the Group's residential properties have
maintained their value.  The external valuation of the hotel in January 2006,
which the Board considers is representative of the position at 30th September
2005, has confirmed a valuation of #4.5m at that date.  This compares with a
book value at 30th September 2005 of #3,367,000 and accordingly a valuation
surplus before taxation of approximately #1.13m has been recorded for this
asset.



After taking account of the trading losses from continuing operations for the
year, interest payable and the unrealised valuation surplus on the Perth hotel
of approximately #1.13m referred to above, a net increase in Shareholders Funds
of approximately #464,000 has arisen during the year ended 30th September 2005.
This net increase has increased Shareholders Funds to #2.9m.



Outlook



As mentioned above, the continuing losses at the travel division during the
first half of the current financial year have led to the Board's decision to
dispose of or close the Group's travel interests. Overall losses and the
anticipated disposal costs are currently estimated at approximately #600,000 and
accordingly Shareholders Funds are estimated at approximately #2.3m at the
present time.



Strategy



In view of these results, the Board considers that the Group is insufficiently
capitalised to be able to generate significant shareholder returns from the
existing property and hotel operations and due to its small size it cannot
readily increase its equity capital to the level required. The losses incurred
by the travel division since the year end have increased the borrowings and debt
across the Group to levels higher than those experienced in previous years.  As
a result, the Board has taken the decision to sell the Group's London properties
and, in principle, subject to shareholder consent, to sell the Group's hotel in
Perth, and it expects these sales will realise at least the book values of the
properties concerned at 30th September 2005.  The Board intends to repay Group
borrowings from the proceeds of these sales and believes that thereafter, the
Group will be positioned to acquire new businesses or to merge with other
operations from a position of greater financial strength.



Dividend



In view of the circumstances outlined above and the current deficiency on the
Company's retained Profit and Loss reserve, the Board has decided not to pay a
dividend for the year to 30th September 2005.  However, the matter will be kept
under review in future periods as the realisations referred to above are
completed





Charles Llewellyn
Chairman





Consolidated profit and loss account
for the year ended 30 September 2005

                                                                                    2005                  2004
                                                                                       #                     #
Turnover:
Continuing operations                                                          8,340,605             2,556,958
                                                                                ________              ________

Cost of sales before goodwill amortisation                                    (7,411,542)          (1,716,508)
Goodwill amortisation                                                            (25,398)             (25,398)
Exceptional item:
Provision for impairment of intangible fixed assets                             (378,871)                    -
                                                                                ________              ________

Cost of sales                                                                 (7,815,811)          (1,741,906)
                                                                                ________              ________

Gross profit                                                                     524,794               815,052

Administrative expenses                                                       (1,060,734)            (841,022)
                                                                                ________              ________
Operating loss
Continuing operations                                                           (535,940)             (25,970)

Profit on disposal of fixed assets                                                     -                13,458
                                                                                ________              ________

Loss on ordinary activities before interest and taxation                        (535,940)             (12,512)

Net interest payable                                                            (132,658)            (150,194)
                                                                                ________              ________

Loss on ordinary activities before and after taxation
transferred to reserves                                                         (668,598)            (162,706)
                                                                                ========              ========

Loss per share
Basic                                                                              (32.2)p              (8.0)p
Diluted                                                                            (32.1)p              (8.0)p
                                                                                ========              ========



Balance Sheet
At 30 September 2005
                                                                     Group
                                                              2005              2004
                                                                 #                 #

Fixed Assets


Intangible assets                                                -           404,269
Tangible assets                                          5,254,838         4,151,163
Investments                                                      -                 -
                                                         _________         _________   
                                                         5,254,838         4,555,432
                                                         _________         _________

Current Assets

Stock                                                        2,602             3,097
Debtors                                                    468,948           430,780
Cash at bank and in hand                                   291,313           577,541
                                                         _________         _________
                                                           762,863         1,011,418

Creditors: due within one year                         (1,187,513)       (1,137,760)
                                                         _________         _________

Net current (liabilities)/assets                         (424,650)         (126,342)
                                                         _________         _________

Total assets less current liabilities                   4,830,188         4,429,090

Creditors: due after one year                          (1,885,000)       (2,005,000)
                                                         _________         _________

Net assets                                               2,945,188         2,424,090
                                                         =========         =========

Capital and reserves

Called up share capital                                  1,579,280         1,534,280
Share premium account                                      362,454           350,454
Revaluation reserve                                      1,599,155           466,459
Profit and loss account                                  (595,701)            72,897
                                                         _________         _________

Equity shareholders' funds                               2,945,188         2,424,090
                                                         =========         =========





Consolidated cash flow statement
for the year ended 30 September 2005

                                                                              2005                          2004
                                                                   #             #              #              #

Net cash (outflow)/inflow from operating                                   (51,478)                      394,059
activities

Returns on investments and servicing of
finance
Interest received                                             12,221                       10,199
Interest paid                                              (146,900)                    (157,552)
                                                           _________                    _________
Net cash outflow from returns on investments
and servicing of finance                                                  (134,679)                    (147,353)

Taxation
UK corporation tax recovered                                                      -                           52

Capital expenditure and financial
investments
Purchase of operating assets                                (43,002)                     (59,317)
Sale of investment properties                                      -                      515,568
                                                           _________                    _________

Net cash (outflow)/inflow from capital
expenditure and financial investment                                       (43,002)                      456,251
                                                                          _________                     ________

                                                                          (229,159)                      703,009

Equity dividends paid                                                             -                          193
                                                                          _________                     ________

Net cash (outflow)/inflow before financing                                (229,159)                      703,202

Management of liquid resources
Cash transferred to treasury operations                                           -                    (150,000)
Cash transferred from treasury operations                                   150,000                            -
                                                                          _________                    _________

                                                                           (79,159)                      553,202
Financing
Issue of new shares                                           57,000                       22,582
Bank loan repaid                                           (100,000)                    (469,575)
Capital element of finance lease rental                     (14,069)                     (17,899)
payments                                                   _________                     ________

Net cash outflow from financing                                            (57,069)                    (464,892)
                                                                          _________                    _________

(Decrease)/increase in cash                                               (136,228)                       88,310
                                                                          =========                    =========



Reconciliation of net cash flow to movement in net debt
for the year ended 30 September 2005
                                                                                   2005                 2004
                                                                                      #                    #

(Decrease)/increase in cash in year                                           (136,228)               88,310
Cash outflow from movement in debt                                             114,069               483,756
                                                                               ________             ________

Net movement in year                                                           (22,159)              572,066
Net debt at 1 October 2004                                                  (1,736,528)           (2,308,594)
                                                                            ___________           __________
    
Net debt at 30 September 2005                                               (1,758,687)           (1,736,528)
                                                                            ===========           ==========


A copy of the Annual Report and Accounts for the year ended 30 September 2005
will be sent to all shareholders this morning and is available form the
Company's registered office.


                      This information is provided by RNS
            The company news service from the London Stock Exchange
END

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