Interim Results
22 January 2004 - 6:00PM
UK Regulatory
PRESS RELEASE
Not for release before 0700, 22nd January 2004
FLETCHER KING PLC
INTERIM RESULTS
Fletcher King, the London based chartered surveyors and property asset
managers, announces interim results for the 6 months to 31st October
2003. The results have improved on the same 6 month period in 2002
despite operating in persistently difficult market conditions.
Financial highlights:
* Profit before tax increased by 33% to �95,000 (2002: �71,000)
* Turnover up 4.1% on the same period as last year to �2.370 million
(2002 �2.277 million)
* Basic earnings per share grew to 0.70p (2002: 0.62p)
* Interim dividend declared at 0.3p (2002: 0.25p)
Operational highlights:
* First transactions completed under the discretionary investment
mandate won from the British Home Stores pension fund in 2003.
* The �20 million Stratton House Investment Property Syndicate now
two thirds invested or committed - appetite remains amongst investors
for second syndicate.
* Fletcher King Howard has seen a re-emergence of construction
management and is now on site with three major new assignments.
* Despite an exceptionally difficult lettings market the agency
department has successfully completed a number of deals.
*
Commenting David Fletcher, chairman of Fletcher King said:
"We are pleased to be able to report that we have improved our results
relative to the same period last year. We anticipate similar levels of
activity as in the first half of the year with the investment market
remaining strong and the current lack of stock continuing to make
competition to buy fierce. We also believe the occupational markets are
unlikely to be materially different in the second half of the year. The
final dividend should be at least in line with last year."
For further information:
David Fletcher, Fletcher King: 020 7493 8400
Christopher Joll / Tim McCall, mj2 ltd: 020 7491 7776
CHAIRMAN'S STATEMENT
RESULTS
The Interim Results for the 6 months to 31st October 2003 have shown an
improvement over the same period last year. Profit before tax was
�95,000 (2002 �71,000) on a turnover of �2.370 million (2002 �2.277
million) with earnings per share of 0.70p (2002 0.62p). Your Directors
have declared an interim dividend of 0.3 p (2002 0.25p) which will be
paid on the 20th February 2004 to shareholders on the register at the
close of business on the 6th February 2004.
THE COMMERCIAL PROPERTY MARKET
London
Occupational demand in London and the South East continues to be subdued
and many in the industry are currently calling this the bottom of the
market. Although we have seen a small increase in the number of
enquiries in the West End, we see no concrete evidence to support the
view that the bottom of the market has been reached. Although we feel
there is unlikely to be a further significant fall in rental levels,
once the low point is reached the market is likely to take a year or two
before recovering and positive signs of rental growth return.
Outside London
With the exception of the office letting markets in major provincial
cities, we are seeing that demand is generally stronger outside of
London. Owner occupiers, particularly for industrial property, remain a
strong sector of the market despite the increase in medium term fixed
interest rates.
Investment
Demand for bond type investments, and those where value can be added,
remains extremely buoyant despite the rise in medium term interest rates
over the last three months. In addition to debt financed purchasers, we
saw institutions continue as buyers as they adjusted fund weightings
towards the property sector. In our view the investment market is likely
to remain strong for the foreseeable future.
DIVISIONAL TRADING
Property Asset Management
The department has performed well during this half year and is actively
pursuing new business. Existing clients continue to add to their
portfolios.
Investment and Fund Management
The department has been active, but the lack of availability of good
investment property has meant that turnover has remained at last year's
level. A number of transactions are in the pipeline and the final out-
turn for the year could be satisfactory.
Valuation and Rating
Both valuation and rating work has increased in the first half and we
anticipate that progress will continue for the remainder of this year.
Agency
Although the letting markets remain difficult we have been active and
have concluded a number of deals including: lettings in mid-town and a
freehold office vacant possession sale in the City. The market generally
is unlikely to improve in the near future.
Manchester
The year started rather slowly but the second quarter showed a
significant increase in turnover. A number of major property
acquisitions are in the pipeline for the second half and we anticipate
the office will show an increase in profit over last year.
Fletcher King Howard
Our construction services division continues its recovery with project
management commissions increasing. It has also seen the re-emergence of
construction management and has started on site with three major new
assignments.
Stratton House Investment Property Syndicate
Approximately two thirds of the fund is now invested or committed, with
a view to being fully invested by April 2004. There is an appetite
amongst some of our existing investors, and others, to start the next
syndicate. We will hopefully do this during the coming year.
OUTLOOK
We anticipate similar levels of activity as in the first half and the
final dividend should be at least in line with last year.
The investment market will remain strong but the current lack of stock
is likely to continue with fierce competition to buy.
The occupational markets are unlikely to be materially different in the
second half.
D J R FLETCHER
CHAIRMAN
22 January 2004
Registered Office
Stratton House,
Stratton Street
London W1J 8LA
Consolidated Profit and
Loss Account
(unaudited) for the six months to 31
October 2003
6 months 6 months to
to to Year to
31 31
October October 30 April
2003 2002 2003
�000 �000 �000
Turnover 2,370 2,277 4,614
Operating Profit 80 61 50
Share of results of
associated
undertakings (3) 0 7
Interest Receivable (net) 18 10 26
Profit on ordinary
activities before
taxation 95 71 83
Taxation (33) (16) (22)
Profit on ordinary
activities after taxation 62 55 61
Dividends (26) (22) (88)
Dividend per Share .3p .25p 1.00p
Retained Profit 36 33 (27)
Earnings per share - basic 0.70p 0.62p 0.69p
NOTES
1. The interim figures for the six months to 31 October 2003, which are
unaudited, have been prepared
on the basis of the accounting policies set out in the Annual Report
and Accounts for the year ended
30 April 2003. The financial information contained in this Interim
Report does not amount to
statutory accounts within the meaning of section 240 of the
Companies Act 1985.
The results for the year ended 30 April 2003 have been extracted from
the published accounts for
that period on which the auditors gave an unqualified report and which
have been delivered to the
Registrar of Companies.
2. Earnings per share are calculated on 8,807,279 ordinary shares in
issue during the six months
(October 2002 - 8,807,279, April 2003 -
8,807,279).
3. This statement is being sent to shareholders. In addition copies are
available from the Company
Secretary at the
Registered Office.
CONSOLIDATED BALANCE SHEET As at As at As at
(unaudited) for the six months 31 31 30 April
to 31 October 2003 October October
2003 2002 2003
�000 �000 �000
Fixed assets
Tangible assets 209 266 221
Investment in associated
undertakings 16 39 19
Other Investments 253 253 253
_________ _________ _________
478 558 493
Current assets
Debtors 1681 2143 1496
Cash at bank and in hand 930 623 1318
_________ _________ _________
2611 2766 2814
Creditors
Amounts falling due within one
year (672) (858) (907)
_________ _________ _________
Net current assets 1939 1908 1907
Total assets less current
liabilities 2417 2466 2400
Creditors
Amounts falling due after one
year 0 (27) (17)
Provisions for liabilities and
charges 0 0 (2)
_________ _________ _________
Net assets 2417 2439 2381
_________ _________ _________
Capital and reserves
Called up share capital 881 881 881
Share premium account 76 76 76
Profit and loss account 1460 1482 1424
_________ _________ _________
2417 2439 2381
========= ========= =========
CONSOLIDATED CASH FLOW STATEMENT 6 months 6 months Year to
to to
(unaudited) for the six months 31 31 30 April
to 31 October 2003 October October
2003 2002 2003
�000 �000 �000
Net cash (outflow)/ inflow from
operating activities (313) (352) 375
Dividends received from
associated undertakings 0 0 26
Returns on investment and
servicing of finance 18 10 26
Taxation 11 0 (41)
Capital expenditure and
financial investment (27) (258) (262)
Equity dividends paid (66) (66) (88)
_________ _________ _________
Cash flow before financing (377) (666) 36
Financing (11) (15) (23)
_________ _________ _________
(Decrease)/Increase in cash in
the half year (388) (681) 13
_________ _________ _________