RNS Number:8162K
Eurocity Properties PLC
28 September 2001
ANNOUNCEMENT
Eurocity Properties PLC ("Eurocity" or "the Company")
Eurocity is pleased to announce its results for the year ended 31 March 2001.
Chairman's Statement
Dear Shareholder,
The year has seen considerable activity including a number of acquisitions
which have been funded in part by issuing ordinary shares at a substantial
premium to market price in part payment thereby increasing the issued equity
and marketability in the company's shares. We are continuing to acquire
properties let on longer term leases to strong covenants providing the company
with a secure income stream. Our funding is generally matched to the
underlying properties acquired and our mortgages are therefore all long term.
The company has developed excellent working relationships with a number of
funders and on behalf of shareholders I would like to thank them for their
support.
A loss has been recorded in the year to 31 March 2001 of #432,061 (2000: #
318,229). The loss arises primarily as a consequence of not having sufficient
income to cover the increased operating overheads as a consequence of the
increased level of corporate activity during the year. The net asset value per
share at the year end is 57.7p (2000: 63.2p) and the net assets have risen to
#3,013,573 (2000: #2,220,126) providing the company with a stronger base for
future expansion.
In view of the current position of the company the directors are not in a
position to recommend the payment of a dividend.
We have continued to make further acquisitions since the year end and we are
looking to carry out innovative transactions in order to achieve out
performance in what are undoubtedly more difficult economic conditions.
Current indications are that the company will continue to make progress in the
coming year.
N Jeffrey LLB
Chairman
Operational and Financial Review
It has been an active year during which we have completed acquisitions in
excess of #8m of properties which has more than doubled the size of the
portfolio. The company has acquired a well-let freehold property investment
comprising retail and offices in Crawley town centre which was funded in part
by the issue of #300,000 in new shares. Further acquisitions include two
retail units in Wishaw let to Scottish Power plc and Shoefayre Limited, an
office/retail investment in Greenock let to Coral Estates Limited where we
issued a further #125,000 in shares, a retail unit in Coatbridge let to Next
plc and a portfolio of nine flats located in Central London where we again
issued #200,000 in shares towards the acquisition.
All of the shares issued for property acquisitions have been at 50p per share
which has throughout the period represented a substantial premium to the
prevailing market price of the shares.
We have taken advantage of the low interest rates that have been available and
all of our loans fully cover all interest and capital reduction payments.
We have secured two new tenants (HFC Bank plc and Endsleigh Insurance) on long
term leases at our property in Norwich, and we are currently negotiating four
outstanding rent reviews where we believe there will be rental growth.
At Main Street, Barrhead, Glasgow, the vacant first floor is being refurbished
to include a new access at a cost of #25,000. Planning consent has been
obtained for leisure use and it is anticipated that a rent of #30,000 per
annum will be achieved. Save for the Barrhead property the portfolio is
virtually fully let.
The company has been focusing on larger transactions and will continue to seek
larger size deals. Purchasing quality investments let on long term leases to
strong tenants will remain the core of our business. Our strategy remains to
issue further shares as part payment for property purchases, which enables us
to increase the size of our portfolio and expand our equity base with limited
cash resources.
Since the year end we have successfully purchased a freehold supermarket
investment in High Street, Scunthorpe, for #710,000 which is let on a lease
with in excess of 19.5 years left currently producing #80,000 per annum with a
significantly higher ERV.
We have also purchased 3 freehold retail investments, (1) Shawlands, Glasgow,
which is let to Burger King for in excess of 17 years, for #530,000 in cash
and 200,000 new ordinary shares issued at 50p per share, the passing rent is #
53,500, (2) Aberystwyth is let to Thorn High Street Properties Ltd trading as
Radio Rentals for a further 121/2 years at a passing rent of #67,500. The
purchase price was #550,000 in cash and the issue of 400,000 new ordinary
shares issued at 50p per share and (3) Paisley, which is let to Stead &
Simpson Ltd for a further period of 15 years at a current rental of #74,500,
the purchase price was #700,000.
We are currently evaluating numerous transactions including corporate
acquisitions.
Baron Bloom
Managing Director
GROUP PROFIT AND LOSS ACCOUNT
For the year ended 31 March 2001
2001 2001 2000 2000
# # # #
INCOME FROM PROPERTIES
Continuing operations 488,469 481,949
Acquisitions 43,409 -
531,878 481,949
Direct property expenses (39,696) (16,216)
Operating expenses (591,801) (322,446)
Exceptional item - (224,400)
OPERATING LOSS
Continuing operations (92,454) (81,113)
Acquisitions (7,165) -
(99,619) (81,113)
Amounts written off (5,188) -
investments
Profit on sale of investment 31,924 -
properties
Investment income 15,735 170
Interest payable (374,913) (237,286)
LOSS ON ORDINARY ACTIVITIES
BEFORE TAXATION (432,061) (318,229)
Taxation - -
LOSS ON ORDINARY ACTIVITIES
AFTER TAXATION (432,061) (318,229)
LOSS PER SHARE
Basic 10.9p 13.9p
Fully diluted 10.9p 13.9p
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the year ended 31 March 2001
2001 2000
# #
Loss for the financial year (432,061) (318,229)
Unrealised surplus on revaluation of investment 385,508 85,074
properties
Total recognised gains and losses relating to the (46,553) (233,155)
year
NOTE OF HISTORICAL COST PROFITS AND LOSSES
for the year ended 31 March 2001
2001 2000
# #
Loss on ordinary activities before taxation (432,061) (318,229)
Realisation of property revaluation losses of previous (66,376) -
years
Historical cost loss on ordinary activities before (498,437) (318,229)
taxation
Historical cost loss for the year retained after
taxation and dividends (498,437) (318,229)
GROUP BALANCE SHEET
31 March 2001
2001 2000
# #
FIXED ASSETS
Tangible assets 9,194,962 5,330,000
CURRENT ASSETS
Stock 1,842,418 -
Debtors 36,560 29,064
Investments 119,442 -
Cash at bank and in hand 115,992 641,101
2,114,412 670,165
CREDITORS: Amounts falling due within one year (2,101,746) (535,756)
NET CURRENT ASSETS 12,666 134,409
TOTAL ASSETS LESS CURRENT LIABILITIES
9,207,628 5,464,409
CREDITORS: Amounts falling due after more than (6,194,055) (3,244,283)
one year
3,013,573 2,220,126
CAPITAL AND RESERVES
Called up share capital 2,612,670 1,757,670
Share premium account 663,581 678,581
Other reserve 53,711 53,711
Revaluation reserve 949,063 497,179
Profit and loss account (1,265,452) (767,015)
SHAREHOLDERS' FUNDS 3,013,573 2,220,126
NET ASSET VALUE PER SHARE 57.7p 63.2p
GROUP CASH FLOW STATEMENT
For the year ended 31 March 2001
2001 2000
# #
Cash flow from operating activities 41,007 165,729
Returns on investments and servicing of (359,178) (237,116)
finance
Taxation - -
Capital expenditure and financial (110,610) (937,174)
investment
Acquisitions and disposals (2,060,420) (150,000)
CASH OUTFLOW BEFORE FINANCING (2,489,201) (1,158,561)
Financing 1,907,816 1,404,435
(DECREASE)/INCREASE IN CASH IN THE PERIOD (581,385) 245,874
2001 2000
# #
Reconciliation of operating loss to net cash flow from
operating activities
Operating loss (99,619) (81,113)
Depreciation 4,549 -
Increase in debtors (720) (15,304)
Increase in creditors 136,797 262,146
Net cash inflow from operating activities 41,007 165,729
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
2001
2000
#
#
Loss for the financial period (432,061) (318,229)
Recognised gains relating to the year 385,508 85,074
New share capital subscribed 855,000 885,675
Share issue expenses (15,000) -
Net addition to shareholders' funds 793,447 652,520
Opening shareholders' funds 2,220,126 1,567,606
Closing shareholders' funds 3,013,573 2,220,126
NOTES TO THE ACCOUNTS
1. The financial information set out above does not constitute
statutory accounts within the meaning of section 240 of the Companies
Act 1985. Statutory financial statements for the financial year ended
31 March 2001 will be delivered to the Registrar of Companies and sent
to the shareholders shortly. An unqualified auditors' report has been
made on such accounts.
2. The Board do not recommend the payment of a dividend.
3. The calculation of loss per ordinary share is based upon the loss after
taxation of #432,061 and on 3,971,492 being the weighted number of
ordinary shares in issue during the period (2000: loss #318,229 and
2,290,993 being the number of ordinary shares).
Fully diluted earnings per share is based on a loss after taxation of #
432,061 (2000: #318,229) and on a weighted average of 3,971,492 (2000:
2,290,993) shares in issue.
The warrants have an exercise price above the fair value of the company's
shares and hence are non dilutive.
4. Copies of the Annual Report will be sent to the shareholders in due course
and additional copies will be available from the company's registered
office at 2 Bloomsbury Street, London, WC1B 3ST. The Annual General
Meeting will be held at the offices of SJ Berwin, 222 Grays Inn Road,
London WC1X 8XF on 7 November 2001.
Approved by the board on 28 September 2001
N Jeffrey Chairman
BA Bloom Managing Director
Enquiries to:
Baron Bloom, Managing Director Tel: 020 7286 4433
Robert Lo/Keith Smith Tel: 020 7710 7400
Nabarro Wells & Co. Limited - Nominated Adviser
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