TIDMNTA
RNS Number : 8791L
Northacre PLC
30 April 2015
NORTHACRE PLC
(the "Company" or "Group")
Results for the period ended 31(st) December 2014
Northacre PLC is pleased to announce its financial results for
the period ended 31(st) December 2014. The Annual Report and
Accounts for the period then ended and Notice of the Company's
Annual General Meeting, to be held at the Company's registered
office at 10am on 2(nd) June 2015, will be available shortly on the
Company's website www.northacre.com and are being posted to those
shareholders who have elected to receive hard copies.
Extracts from the Company's Annual Report and Accounts are shown
below.
Enquiries:
Northacre PLC
Niccolò Barattieri di San Pietro (Chief Executive Officer)
020 7349 8000
finnCap Limited (Nominated Adviser and Broker)
Stuart Andrews
Henrik Persson
020 7220 0500
Chairman's Statement
There is a marked slowdown of activities in the London housing
market with many potential purchasers waiting for the outcome of
the May 2015 elections. Despite of the results, we don't believe
that there will be any radical changes to the market's perception
of London as the number one city in the world as a destination for
ultra-high net worth individuals.
The London property market has a tendency to adjust itself and
absorb whatever changes there may be, if any.
There is the inevitable pause in the London housing market as
many potential purchasers await the outcome of the 2015 election.
Irrespective of the results of the election, we do not believe that
there will be a radical change in the market perception of London
as the number one city in the world, a destination for ultra-high
net worth individuals. The London residential market has
historically adjusted itself and absorbed the various changes
brought about by different governments.
The housing debate is steadily rising up the UK political
agenda, and will continue to be a key issue. The construction of
new homes at an affordable level will be at the forefront of future
government programmes, and is likely to affect the attitude of the
planning authorities towards the development of private housing for
sale at the upper end of the market. The current re-focusing of the
market towards the private rented sector could, however, open up
further opportunities for companies prepared to invest in
well-conceived and properly governed models for rental housing at
both ends of the scale.
Klas Nilsson
Non-Executive Chairman
Date: 30(th) April 2015
Chief Executive's Statement
The last ten months have seen Northacre PLC make good progress
across all of our developments. We have also strategically
rebranded our interior design business which is now called "N
Studio", which signifies a more sophisticated approach intended to
reflect and capture the increasingly discerning taste of high net
worth individuals and our target market.
Current developments
1 Palace Street
We have been making steady progress throughout the period and
every milestone has been achieved in accordance with our programme.
On 11(th) November 2014 we received planning consent for our
revised scheme and by 30(th) November 2014 we were already onsite
starting the strip-out and demolition phase.
Vicarage Gate House
The complications we have encountered with the windows have
escalated and this has caused delay to our practical completion
date which has now been moved to mid-October 2015. The vast
majority of the windows have now been installed hence the rest of
the fit-out can move forward at a much faster pace.
In respect of sales throughout the period, we have exchanged on
five units. We are seeing more appetite from buyers as they can now
get a much better feel for the development and the overall quality
we are producing.
33 Thurloe Square
As highlighted in my statement last year, prior to starting the
redevelopment of this site we received an unsolicited bid of
GBP12.75m representing a significant premium to the market value of
similar properties in similar condition. The transaction was
completed on 25(th) June 2014 and resulted in a net IRR of over 30%
to our investors and a substantial return for Northacre PLC in
terms of development management fees, performance fee and return on
our invested equity.
13&14 Vicarage Gate
The last few months have seen significant progress on-site. All
the structural alterations have been completed and the partition
walls are mostly in place. We are expecting to have practical
completion by January 2016.
On the sales front we will do a soft launch in June 2015 which
will then become more proactive once the show apartment is ready at
the end of August 2015.
Chester Square (with mews at the rear)
We have received planning approval for the creation of a
basement and also to interconnect the two properties. The basement
contractor has been selected and will be onsite as soon as all the
preconditions have been discharged. The project is progressing well
towards implementing our plans.
22 Prince Edward Mansions
On 1(st) August 2014 we announced the completion of the
acquisition of 22 Prince Edward Mansions by Northacre Capital (7)
Limited, a wholly owned subsidiary of Northacre PLC. The unit was
purchased in keeping with our new strategy for N Studio, and for
the purpose of refurbishment and resale.
We are currently onsite and expect to reach practical completion
by the end of 2015.
The Lancasters
The freehold interest in the property has now been transferred
to the residents. We are in the process of finalising the last
outstanding item which we hope to complete by the end of summer
2015.
Outlook
As a result of the upcoming general election in May 2015 the
market in general has been quiet as expected. Nevertheless, it has
been interesting to see that the market has become more selective
and has been rewarding premium properties which satisfy all the
requirements of buyers. On the other hand less impressive
properties have struggled to sell. We believe that this trend will
continue as buyers become more selective.
At Northacre, our differentiating value-add is the quality of
our work and attention to detail which places our final product
ahead of the crowd. We hope to continue to see ourselves as market
leaders in the coming years.
Niccolò Barattieri di San Pietro
Chief Executive Officer
Date: 30(th) April 2015
Financial Review
In the period under review our development management team was
engaged on various projects including Vicarage Gate House, 1 Palace
Street, 33 Thurloe Square, 13 & 14 Vicarage Gate and Chester
Square. Increased activity on all of these projects was reflected
in the results for the period to 31(st) December 2014.
Consolidated Income Statement
Group revenue for the period increased to GBP3.9m (28(th)
February 2014: GBP3.0m), which reflected increased activity on the
project development side of the business and a lower level of
activity in N Studio, the Group's interior design business.
Development management fee income increased to GBP3.6m (28(th)
February 2014: GBP1.0m) while N Studio's revenue fell by 89% to
GBP0.2m (28(th) February 2014: GBP2.0m). Between October 2014 and
February 2015 N Studio rebranded and we expect increased activity
in the coming years.
Administrative expenses decreased to GBP4.4m (28(th) February
2014: GBP4.9m) reflecting the shorter 10 months financial
period.
On 25(th) June 2014 the Group announced the sale of the 33
Thurloe Square project. Under the terms of the Development
Management Agreement Northacre PLC was entitled to development
management and performance fees which are included in the revenue
above. The Group was also entitled to a return on the invested
equity of GBP1.5m and dividends received of GBP0.4m (28(th)
February 2014: The Lancasters dividends GBP15.0m) are recognised as
investment revenue in the Consolidated Income Statement.
The Group reported a loss before tax of GBP1,858 (28(th)
February 2014: profit before tax GBP12.3m).
Consolidated Statement of Financial Position
As at 31(st) December 2014 the Group had cash and cash
equivalents of GBP2.5m (28(th) February 2014: GBP21.2m). The
decrease in cash held was primarily due to dividends paid of
GBP15.0m, the additional investment of GBP1.2m in available for
sale financial assets being the 1 Palace Street Development and the
GBP4.2m purchase and associated development costs of 22 Prince
Edward Mansions.
Financing
On 19(th) September 2014 a loan facility of GBP3.2m was made
available by the Royal Bank of Scotland in respect of the property
at 22 Prince Edward Mansions. The loan is available on a drawdown
basis and incurs interest at 3.25% above the LIBOR rate. The loan
is due to be repaid the earlier of the latest expiry date of the
current interest period outstanding as at the date of completion of
sale of the property or the date which falls 18 months after the
date on which the loan is drawn. As at 31(st) December 2014 GBP1.0m
was drawn. The loan is expected to be repaid in full prior to the
end of the next financial year.
In the next financial year, the Group will focus on progressing
and completing current projects while looking for new exciting
opportunities.
Kasia Maciborska-Singh
Group Financial Controller
Consolidated Income Statement
For the 10 months ended 31(st) December 2014
Note 10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
GBP GBP
Group
Group revenue 3 3,856,841 2,955,797
Cost of sales 25,092 (1,294,225)
------------ ------------
Gross profit 3,881,933 1,661,572
Administrative expenses (4,377,515) (4,868,726)
Group loss from operations (495,582) (3,207,154)
Investment revenue 4 493,727 15,063,052
Profit on disposal of available
for sale financial assets 5 - 111,213
Other gains 6 - 336,264
Finance costs 7 (3) (100)
(Loss)/Profit for the year
before taxation 8 (1,858) 12,303,275
Taxation 10 266,095 (102,993)
------------ ------------
Profit for the year attributable
to equity holders of the
Company 264,237 12,200,282
============ ============
Profit per Ordinary share
Basic - Continuing and
total operations 22 0.62p 39.51p
Diluted - Continuing and
total operations 22 0.62p 39.51p
Company
Profit for the year attributable
to equity holders of the Company 5,402,344 44,703,358
========== ===========
Consolidated Statement of Comprehensive Income
For the 10 months ended 31(st) December 2014
Note 10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
GBP GBP
Group
Profit for the period attributable
to equity holders of the
Company 264,237 12,200,282
---------- -------------
Other comprehensive loss:
Changes in fair value of
available for sale financial
assets 14(a) - (15,000,000)
---------- -------------
Total comprehensive income/(loss)
for the period 264,237 (2,799,718)
========== =============
Company
Profit for the period attributable
to equity holders of the Company 5,402,344 44,703,358
---------- -----------
Other comprehensive income - -
---------- -----------
Total comprehensive profit
for the period 11 5,402,344 44,703,358
========== ===========
Consolidated Statement of Financial Position
As at 31(st) December 2014
31(st) 28(th)
Dec Feb
Note 2014 2014
GBP GBP
Non-current assets
Goodwill 12 8,007,417 8,007,417
Property, plant
and equipment 13 721,525 822,739
Available for sale
financial assets 14(a) 10,000,019 8,824,659
----------- -----------
18,728,961 17,654,815
----------- -----------
Current assets
Inventories 15 4,192,123 168,559
Trade and other
receivables 16 787,210 6,667,711
Cash and cash equivalents 2,510,305 21,239,909
----------- -----------
7,489,638 28,076,179
----------- -----------
Total assets 26,218,599 45,730,994
Current liabilities
Trade and other
payables 17 838,384 6,615,535
Borrowings, including
lease finance 18 1,000,000 -
----------- -----------
1,838,384 6,615,535
----------- -----------
Non-current liabilities
Borrowings, including
lease finance - -
- -
----------- -----------
Total liabilities 1,838,384 6,615,535
----------- -----------
Equity
Share capital 23 1,058,388 1,058,388
Share premium account 23 22,565,286 22,565,286
Merger reserve 23 - 8,086,293
Retained earnings 756,541 7,405,492
----------- -----------
Total equity 24,380,215 39,115,459
----------- -----------
Total equity and
liabilities 26,218,599 45,730,994
Approved by the
Board on 30(th)
April 2015
N. Barattieri di
San Pietro.................................................
Director
Company registration no. 03442280
Company Statement of Financial Position
As at 31(st) December 2014
31(st) 28(th)
Dec Feb
Note 2014 2014
GBP GBP
Non-current assets
Property, plant
and equipment 13 728,963 823,633
Investments 14(b) 18,006,328 16,830,968
--------------- ---------------
18,735,291 17,654,601
--------------- ---------------
Current assets
Trade and other
receivables 16 8,999,218 10,110,093
Cash and cash equivalents 1,036,842 18,808,382
--------------- ---------------
10,036,060 28,918,475
--------------- ---------------
Total assets 28,771,351 46,573,076
Current liabilities
Trade and other
payables 17 1,576,073 9,780,661
Borrowings, including
lease finance 18 - -
--------------- ---------------
1,576,073 9,780,661
--------------- ---------------
Non-current liabilities
Borrowings, including
lease finance - -
- -
--------------- ---------------
Total liabilities 1,576,073 9,780,661
--------------- ---------------
Equity
Share capital 23 1,058,388 1,058,388
Share premium account 23 22,565,286 22,565,286
Merger reserve 23 - 8,086,293
Retained earnings 3,571,604 5,082,448
--------------- ---------------
Total equity 27,195,278 36,792,415
--------------- ---------------
Total equity and
liabilities 28,771,351 46,573,076
Approved by the
Board on 30(th)
April 2015
N. Barattieri di
San Pietro.................................................
Director
Company registration no. 03442280
Consolidated and Company Statements of Cash Flows
For the 10 months ended 31(st) December 2014
Group Company
10 months 12 months 10 months 12 months
ended ended ended ended
31(st) 28(th) 31(st) 28(th)
Dec 2014 Feb 2014 Dec 2014 Feb 2014
GBP GBP GBP GBP
Cash flows from operating
activities
(Loss)/profit for the
period before tax (1,858) 12,303,275 5,350,239 44,227,761
Adjustments for:
Investment revenue (493,727) (15,063,052) (7,763,727) (42,756,665)
Finance costs 3 100 - -
Loss on disposal of
investments - 1,108 - 1,108
Goodwill on acquisition
less stamp duty paid - (368,287) - -
Profit on sale of available
for sale financial
assets - (111,213) - -
Fair value adjustment - (7,148,575) - -
Depreciation and amortisation 125,037 148,181 94,670 113,604
Increase in inventories (4,023,564) (13,748) - -
Decrease/(increase)
in trade and other
receivables 5,893,986 (4,834,599) 326,464 (8,849,164)
(Decrease)/increase
in trade and other
payables (5,790,636) 5,350,579 (8,166,245) (21,055,109)
------------- ------------- ------------- -------------
Cash used in operations (4,290,759) (9,736,231) (10,158,599) (28,318,465)
Interest paid (3) (100) - -
Corporation tax - consortium
relief refunded 266,095 3,292,776 798,173 2,375,362
------------- ------------- ------------- -------------
Net cash used in operating
activities (4,024,667) (6,443,555) (9,360,426) (25,943,103)
------------- ------------- ------------- -------------
Cash flows from investing
activities
Purchase of property,
plant & equipment (23,823) (51,691) - -
Increase in available
for sale financial
assets/investments (1,175,360) (8,824,655) (1,175,360) (8,824,655)
Acquisition of subsidiary,
net of cash acquired - 10,502,191 - -
Interest received 64,854 63,052 64,854 49,606
Dividends received 428,873 15,000,000 7,698,873 42,707,059
------------- ------------- ------------- -------------
Net cash (used in)/generated
from investing activities (705,456) 16,688,897 6,588,367 33,932,010
------------- ------------- ------------- -------------
Cash flows from financing
activities
Proceeds from issue
of shares - 12,489,516 - 12,489,516
Proceeds from borrowings 1,000,000 - - -
Repayment of borrowings - - - -
Repayment of finance
leases - - - -
Dividends paid (14,999,481) (10,689,457) (14,999,481) (10,689,457)
------------- ------------- ------------- -------------
Net cash (used in)/generated
from financing activities (13,999,481) 1,800,059 (14,999,481) 1,800,059
------------- ------------- ------------- -------------
(Decrease)/increase
in cash and cash equivalents (18,729,604) 12,045,401 (17,771,540) 9,788,966
Cash and cash equivalents
at the beginning of
the period 21,239,909 9,194,508 18,808,382 9,019,416
------------- ------------- ------------- -------------
Cash and cash equivalents
at the end of the period 2,510,305 21,239,909 1,036,842 18,808,382
============= ============= ============= =============
Consolidated and Company Statements of Changes in Equity
For the 10 months ended 31(st) December 2014
Called
Up Share
Share Premium Merger Retained
Group Capital Account Reserve Earnings Total
GBP GBP GBP GBP GBP
As at 1(st) March
2013 668,091 18,552,361 - 20,894,667 40,115,119
Profit for the period - - - 12,200,282 12,200,282
Other comprehensive
loss for the period:
Changes in fair value
of available for
sale financial assets - - - (15,000,000) (15,000,000)
Transactions with
owners of the Company:
Issue of Ordinary
shares 390,297 4,012,925 8,086,293 - 12,489,515
Dividends - - - (10,689,457) (10,689,457)
As at 28(th) February
2014 1,058,388 22,565,286 8,086,293 7,405,492 39,115,459
========== =========== ============ ============= =============
As at 1(st) March
2014 1,058,388 22,565,286 8,086,293 7,405,492 39,115,459
Profit for the period - - - 264,237 264,237
Transactions with
owners of the Company:
Dividends - - (8,086,293) (6,913,188) (14,999,481)
---------- ----------- ------------ ------------- -------------
As at 31(st) December
2014 1,058,388 22,565,286 - 756,541 24,380,215
========== =========== ============ ============= =============
Called
Up Share
Share Premium Merger Retained
Company Capital Account Reserve Earnings Total
GBP GBP GBP GBP GBP
As at 1(st) March
2013 668,091 18,552,361 - (28,931,453) (9,711,001)
Total comprehensive
profit for the period - - - 44,703,358 44,703,358
Transactions with
owners of the Company:
Issue of Ordinary
shares 390,297 4,012,925 8,086,293 - 12,489,515
Dividends - - - (10,689,457) (10,689,457)
As at 28(th) February
2014 1,058,388 22,565,286 8,086,293 5,082,448 36,792,415
========== =========== ============ ============= =============
As at 1(st) March
2014 1,058,388 22,565,286 8,086,293 5,082,448 36,792,415
Total comprehensive
profit for the period - - - 5,402,344 5,402,344
Transactions with
owners of the Company:
Dividends - - (8,086,293) (6,913,188) (14,999,481)
---------- ----------- ------------ ------------- -------------
As at 31(st) December
2014 1,058,388 22,565,286 - 3,571,604 27,195,278
========== =========== ============ ============= =============
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014
1. Principal accounting policies
The principal accounting policies are as follows:
Accounting basis and standards
These financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) as adopted by
the European Union.
The Company and its subsidiaries have shortened their reporting
periods to 31(st) December 2014 to be co-terminous with the
ultimate parent undertaking Abu Dhabi Financial Group Limited. The
amounts presented in the financial statements for the period ended
31(st) December 2014 are thus not entirely comparable to the
comparative amounts.
During the period ended 31(st) December 2014 the Group adopted a
number of new IFRS standards, interpretations, amendments and
improvements to existing standards. These included IFRS10, IFRS11,
IFRS12, IFRS13 and IAS1. These new standards and changes did not
have any material impact on the Company's financial statements.
The following new standards, amendments to standards or
interpretations are mandatory for the Group for the first time for
the financial year beginning 1(st) January 2015, but are not
currently considered to be relevant to the Group (although they may
affect the accounting for future transactions and events):
-- IFRS 9, 'Financial Instruments', issued in November 2009 and
effective from 1(st) January 2015. IFRS 9 represents the first
phase of the IASB's project to replace IAS 39 'Financial
Instruments: Recognition and Measurement'. It sets out the
classification and measurement criteria for financial assets and
liabilities and requires all financial assets, including assets
currently classified under IAS 39 as available for sale, to be
measured at fair value through profit and loss unless the assets
can be classified as held at amortised cost. Qualifying equity
investments held at fair value may have their fair value changes
taken through other comprehensive income by election.
-- IAS 19 (Revised), 'Employee Benefits' effective for periods
beginning on or after 1(st) July 2014. These amendments are
intended to provide a clearer indication of an entity's obligations
resulting from the provision of defined benefit pension plan and
how those obligations will affect its financial position, financial
performance and cash flow.
The following new standards, amendments to standards and
interpretations have been issued, but are not effective for the
financial year beginning 1(st) January 2015 and have not been early
adopted:
-- IFRS9, 'Financial Instruments', effective for periods
commencing on or after 1(st) January 2018 but not yet adopted by
the EU. This is the second and third phases of the project to
replace IAS39 'Financial Instruments: Recognition and
Measurement'.
-- IFRS15, 'Revenue from Contracts with Customers', effective
for periods commencing on or after 1(st) January 2017 but not yet
adopted by the EU. This standard replaces IAS18, 'Revenue
Recognition' and revenue recognition standards under US GAAP and
aims to unify revenue recognition under IFRS and US GAAP. The
standard focuses on entitlement to consideration as opposed to
percentage completion under existing IFRS and introduces a five
step approach to recognising income.
Business combinations and goodwill
Goodwill relating to acquisitions prior to 1(st) March 2006 is
carried at the net book value on that date and is no longer
amortised but is subject to annual impairment review. On
acquisition, the assets, liabilities and contingent liabilities of
a subsidiary are measured at their fair values at the date of
acquisition. Any excess of the cost of acquisition over the fair
values of the identifiable net assets acquired is recognised as
goodwill. Any deficiency of the cost of acquisition below the fair
values of the identifiable net assets acquired (i.e. discount on
acquisition) is credited to the income statement in the period of
acquisition. Goodwill is tested annually for impairment.
Going Concern
The Company and Group currently meet their day-to-day working
capital requirements through fees receivable from its projects:
Vicarage Gate House, 13-14 Vicarage Gate, 1 Palace Street and
Chester Square and also through the bank loan.
The Directors have prepared detailed cash flow projections for
the period ending 31(st) December 2019 making reasonable
assumptions about the levels and timings of income and expenditure,
and in particular the timing of receipt of certain fees due from
major developments. These projections show that the Group can meet
its on-going working capital requirements. On this basis the
Directors consider it appropriate to prepare the financial
statements on a going concern basis.
Significant judgements and estimates of areas of uncertainty
In preparing these financial statements the Directors are
required to make judgements and best estimates of the outcome of
and in particular, the timing of revenues, expenses, assets and
liabilities based on assumptions. These assumptions are based on
historical experience and various other factors that are considered
reasonable under the various circumstances. The estimates and
assumptions are reviewed on a regular basis with any revisions
being applied in the relevant period. The material areas where
estimates and assumptions are made are:
- The valuation of goodwill
- The valuation of available for sale financial assets
- The status and progress of the developments and projects
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
1. Principal accounting policies (continued)
Basis of consolidation
The Group financial statements include the financial statements
of the Company and its subsidiary undertakings. Subsidiary
undertakings are all entities over which the Group has the power to
govern the financial and operating policies of the subsidiary and
therefore exercises control. The existence and effect of both
current voting rights and potential voting rights that are
currently exercisable or convertible are considered when assessing
whether control of an entity is exercised. Subsidiaries are
consolidated from the date at which the Group obtains the relevant
level of control and are de-consolidated from the date at which
control ceases.
Inter-company transactions, balances and unrealised gains on
transactions between Group companies are eliminated. Unrealised
losses are also eliminated. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with the
policies adopted by the Group.
Property, plant and equipment
Property, plant and equipment are stated at historical cost, net
of any depreciation and any provision for impairment.
Depreciation has been calculated on a straight line basis and
aims to write off the costs, less estimated residual value of each
property, plant and equipment over their expected useful lives
using the following periods:
Leasehold improvements over the period of the lease
Fittings and office equipment 25% straight line
Computer equipment 33 1/3% straight line
Impairment of assets
Assets that have an indefinite useful life are not subject to
amortisation but are instead tested annually for impairment and are
subject to additional impairment testing if events or changes in
circumstances indicate that the carrying amount of an asset may not
be recoverable.
Assets that are subject to depreciation and amortisation are
reviewed for impairment whenever events or changes in circumstances
indicate that the carrying amount may not be recoverable.
Indicators of impairment are reviewed annually.
An impairment loss is recognised for the amount by which the
asset's carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset's fair value less
costs to sell and value in use. Any impairment charge is recognised
in profit or loss in the year in which it occurs. When an
impairment loss, other than an impairment loss on goodwill,
subsequently reverses due to a change in the original estimate, the
carrying amount of the asset is increased to the revised estimate
of its recoverable amount, up to the carrying amount that would
have resulted, net of depreciation, had no impairment loss been
recognised for the asset in prior years.
Inventories
Work in progress is valued at the lower of cost and net
realisable value. Cost of work in progress includes overheads
appropriate to the stage of development. Net realisable value is
based upon estimated selling price less further costs expected to
be incurred to completion and disposal.
Revenue
Revenue represents amounts earned by the Group in respect of
services rendered during the period net of value added tax. Shares
in development profits and performance fees are recognised when the
amounts involved have been finally determined and agreed criteria
for recognition have been fulfilled. Fees in respect of project
management and interior and architectural design are recognised in
accordance with the stage of completion of the contract.
Current taxation
The tax expense for the year represents the total of current
taxation and deferred taxation. The charge in respect of current
taxation is based on the estimated taxable profit for the year.
Taxable profit for the year is based on the profits as shown in
profit or loss, as adjusted for items or expenditure, which are not
deductible for tax purposes.
The current tax liability for the year is calculated using tax
rates, which have either been enacted or substantively enacted at
the reporting date.
Deferred taxation
Deferred tax is provided in full on all temporary differences
arising between the tax base of assets and liabilities and their
carrying values in the financial statements. The deferred tax is
not accounted for if it arises from initial recognition of an asset
or liability in a transaction other than a business combination
that at the time of transaction affects neither accounting nor
taxable profit or loss.
Deferred tax is determined using tax rates which have been
enacted or substantively enacted at the reporting date and are
expected to apply when the related deferred tax asset is realised
or the deferred tax liability is settled.
Deferred tax assets are recognised to the extent that it is
probable that future taxable profits will be available against
which the temporary differences can be utilised. Deferred tax is
provided on temporary differences arising on investments in
subsidiaries and associates, except where the timing of the
reversal of the temporary difference is controlled by the Group and
it is probable that the temporary difference will not reverse in
the foreseeable future.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
1. Principal accounting policies (continued)
Leased assets
Assets held under finance leases and hire purchase contracts are
capitalised in the statement of financial position and depreciated
over their expected useful lives. The interest element of the
rental obligations is charged to profit or loss over the period of
the lease on a straight-line basis.
Rentals under operating leases are charged to profit or loss on
a straight-line basis over the lease term.
Investments
Investments in subsidiaries, associates and joint ventures, and
other investments are presented in the Parent financial statements
at cost, less any necessary provision for impairment.
Associates
Associates are all entities over which the Group exercise
significant influence but does not exercise control. Investments in
associates are accounted for using the equity method of accounting
and are initially recognised at cost, which includes goodwill
identified on acquisition, net of any accumulated impairment loss.
The Group's share of its associate's profits or losses after
acquisition of its interest is recognised in profit or loss and
cumulative post-acquisition movements are adjusted against the
carrying amount of the investment. Where the Group's share of
losses of an associate equals or exceeds the carrying amount of the
investment, the Group only recognises further losses where it has
incurred obligations or made payments on behalf of the
associate.
Financial assets
Available for sale financial assets consist of equity
investments in other companies or limited partnerships where the
Group does not exercise either control or significant influence.
The investments reflect loans and capital contributions made in
respect of projects undertaken with other partners in which the
Group will be entitled to an eventual profit share.
Available for sale financial assets are shown at fair value at
each reporting date with changes in fair value being shown in Other
Comprehensive Income, or at cost less any necessary provision for
impairment where a reliable estimate of fair value is not able to
be determined. In cases where the Group can reliably estimate fair
value of the available for sale financial assets, fair value will
be determined in reference to practical completion of each
development project.
All assets for which fair value is measured or disclosed in the
financial statements are categorised within the fair value
hierarchy, described as follows, based on the lowest level input
that is significant to the fair value measurement as a whole:
-- Level 1 - Quoted (unadjusted) market prices in active markets
for identical assets or liabilities.
-- Level 2 - Valuation techniques for which the lowest level
input that is significant to the fair value measurement is directly
or indirectly observable.
-- Level 3 - Valuation techniques for which the lowest level
input that is significant to the fair value measurement is
unobservable.
The valuation technique applied to the available for sale
financial assets in the current and preceding period is a Level 3
technique.
Pensions
The Group operates a defined contribution pension scheme under
which fixed contributions are payable. Pension costs charged to the
income statement represent amounts payable to the scheme during the
year.
Foreign currency translation
Transactions in foreign currencies are translated into sterling
at the rate of exchange ruling at the date of the transaction.
Assets and liabilities are translated at the rate of exchange
ruling at the reporting date. Exchange differences are taken into
account in arriving at Group operating profit.
Share capital
Ordinary shares are classified as equity. Incremental costs
directly attributable to the issue of new shares or options are
charged to the share premium account.
Equity balances
-- Called up share capital represents the aggregate nominal value of ordinary shares in issue.
-- The share premium account represents the incremental paid up
capital above the nominal value of ordinary shares issued.
-- The merger reserve represents the excess over nominal value
of the fair value of consideration received for equity shares
issued directly to acquire another entity meeting the specific
requirements of section 612 of the Companies Act 2006.
Financial assets - loans and receivables
Trade receivables, loans and other receivables are classified as
'trade and other receivables' and are measured at cost less any
provisions. Interest income is recognised by applying the
appropriate interest rate of the contractual arrangement.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
1. Principal accounting policies (continued)
Financial liabilities - loans and payables and borrowings
Trade payables, other payables and borrowings are classified as
'trade and other payables' and 'borrowings, including lease
finance'. These are measured at amortised cost and the interest
expense is recognised by applying the appropriate interest rate of
the contractual arrangement.
Borrowings
Interest-bearing borrowings are recognised initially at fair
value, net of any transaction costs incurred. Borrowings are
subsequently stated at amortised cost using the effective interest
method with any differences between the proceeds (net of
transaction costs) and the redemption value being recognised over
the period of borrowings.
All borrowings are classified as current unless the Group has an
unconditional right to defer payment of the borrowings until at
least twelve months from the reporting date.
Borrowing costs which relate directly to a development which is
included within inventories are capitalised as part of the cost of
the inventory.
2. Capital and financial risk management
The Group manages its capital to ensure that the Group will be
able to continue as a going concern, while maximising the return to
shareholders through the optimisation of its debt and equity
balance.
The capital structure of the Group consists of cash and cash
equivalents, debt and equity attributable to equity holders of the
Parent Company, comprising issued capital, share premium account
and retained earnings.
The Group manages the capital structure and makes adjustments to
it in the light of changes in economic conditions. In order to
maintain or adjust the capital structure, the Group may adjust the
amount of dividends payable to shareholders, return capital to
shareholders, issue new shares or sell assets to reduce debt or
increase capital.
The Board regularly reviews the capital structure, with an
objective to minimise net debt whilst investing in the development
opportunities.
The Group's activities expose it to a variety of financial risks
and those activities involve the analysis, evaluation, acceptance
and management of some degree of risk or combination of risks.
Taking risk is core to the property business and the operational
risks are an inevitable consequence of being in business. The
Group's aim is to achieve an appropriate balance between risk and
return and minimise potential adverse effects on the Group's
performance.
The Group's risk management policies are designed to identify
and analyse these risks, to set appropriate risk limits and
controls, and to monitor the risks by means of a reliable
up-to-date information system. The Group regularly reviews its risk
management policies and systems to reflect changes in markets,
products and emerging best practice.
Risk management is carried out by the Board of Directors.
Directors are responsible for the identification of the major
business risks faced by the Group and for determining the
appropriate course of action to manage those risks. The most
important types of risk are credit risk, liquidity and market risk.
Market risk includes currency, interest rate and other price
risks.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
3. Segmental information
Segmental information is presented in respect of
the Group's business segments. The business segments
are based on the Group's corporate and internal
reporting structure. Segment results and assets
include items directly attributable to a segment
as well as those that can be allocated to a segment
on a reasonable basis. The segmental analysis of
the Group's business as reported internally to
management is as follows:
Revenue
10 months 12 months
ended ended
31(st) 28(th)
Dec 2014 Feb 2014
Principal activities: GBP GBP
Development management 3,554,800 900,705
Interior design 214,541 1,991,837
Architectural
design 87,500 63,255
----------- --------------------
3,856,841 2,955,797
=========== ====================
10 months 12 months
ended ended
(Loss)/profit 31(st) 28(th)
before taxation Dec 2014 Feb 2014
GBP GBP
Development management 505,910 12,364,592
Interior
design (585,943) (105,086)
Architectural
design 78,175 43,769
----------- --------------------
(1,858) 12,303,275
=========== ====================
31(st) 28(th)
Assets Dec 2014 Feb 2014
GBP GBP
Development management 26,017,628 45,138,754
Interior design 86,839 454,183
Architectural
design 114,132 138,057
----------- --------------------
26,218,599 45,730,994
31(st) 28(th)
Liabilities Dec 2014 Feb 2014
GBP GBP
Development management 365,962 5,259,612
Interior design 769,522 550,923
Architectural design 702,900 805,000
----------- --------------------
1,838,384 6,615,535
=========== ====================
A geographical analysis of the
Group's revenue, assets and liabilities
is given below:
10 months 12 months
ended ended
31(st) 28(th)
Revenue Dec 2014 Feb 2014
GBP GBP
United Kingdom 3,880,379 2,536,571
Saudi Arabia (23,538) 396,162
USA - 23,064
3,856,841 2,955,797
=========== ====================
Included in the revenue above are revenues in respect
of customers who account for over 10% of the Group's
total revenue.
10 months 12 months
ended ended
31(st) 28(th)
Dec 2014 Feb 2014
GBP GBP
Customer A (Interior
design) (23,538) 396,162
Customer B (Development
management) 642,486 -
Customer C (Interior
design) - 707,113
Customer D (Development
management & interior design) 438,462 326,669
Customer E (Interior
design) - 422,206
Customer F (Development
management) 2,420,487 509,783
=========== ====================
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
Segmental information
3. (continued)
31(st) 28(th)
Dec Feb
Assets 2014 2014
GBP GBP
United Kingdom 26,218,599 45,618,042
Saudi Arabia - 112,952
26,218,599 45,730,994
=========== ===========
31(st) 28(th)
Dec Feb
Liabilities 2014 2014
GBP GBP
United Kingdom 1,838,384 6,544,924
Saudi Arabia - 70,611
----------- -----------
1,838,384 6,615,535
=========== ===========
4. Investment revenue 10 months 12 months
ended ended
31(st) 28(th)
Dec 2014 Feb 2014
GBP GBP
Interest
received 64,854 63,052
Dividends received 428,873 15,000,000
493,727 15,063,052
========== ===========
5. Profit on disposal of available
for sale financial assets 10 months 12 months
ended ended
31(st) 28(th)
Dec 2014 Feb
2014
GBP GBP
Derecognition of available for
sale financial assets - (7,148,575)
Change in fair value of available
for sale financial assets previously
recognised in
Other Comprehensive Income - 7,259,788
- 111,213
============ ============
The profit on disposal of available for sale financial assets
arose following the acquisition of Lancaster Gate (Hyde Park)
Limited on 16(th) December 2013. The loss of GBP7.1m represented
all gains recognised and booked to Other Comprehensive Income up to
the time of derecognition of available for sale financial assets,
as these gains are required to be transferred to the Consolidated
Income Statement after the available for sale financial assets have
been sold.
6. Other gains 10 months 12 months
ended ended
28(th)
31(st) Feb
Dec 2014 2014
GBP GBP
Written off share capital of dissolved
dormant Group's subsidiaries - (1,108)
Negative goodwill arising on acquisition
of Lancaster Gate (Hyde Park)
Limited - 337,372
- 336,264
============ ==========
7. Finance costs 10 months 12 months
ended ended
28(th)
31(st) Feb
Dec 2014 2014
GBP GBP
Interest on:
Other interest 3 -
Tax penalties - 100
---------- ----------
3 100
========== ==========
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
(Loss)/Profit
8. before taxation 10 months 12 months
ended
ended 28(th)
31(st) Feb
Dec 2014 2014
GBP GBP
(Loss)/Profit before taxation is
stated after charging:
Depreciation and amounts
written off property, plant
and equipment:
Owned assets 125,037 148,181
Operating lease
rentals:
Land and buildings 104,969 125,062
Foreign exchange
loss - 41
========== ==========
Fees payable to the Company's
auditors for:
- the audit of the
Company's annual
accounts 55,857 44,446
Fees payable to the Company's auditors
for other services to the Group:
- the audit
of the Company's
subsidiaries 33,600 42,828
---------- ----------
Total audit
fees 89,457 87,274
========== ==========
Fees payable to the Company's
auditors for:
- taxation compliance
services - 10,537
- other taxation
advisory services 5,000 4,000
- other services 16,762 31,158
---------- ----------
Total other
fees 21,762 45,695
========== ==========
9. Employees 10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
Number Number
The average weekly number
of employees (including
Directors) during the
year was:
Office and
management 12 12
Design and
management 12 11
---------- ----------
24 23
========== ==========
10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
Staff costs
for the above
employees: GBP GBP
Wages and salaries 1,691,496 1,821,228
Social security
costs 184,657 62,702
Other pension costs
- money purchase
schemes 65,344 74,068
---------- ----------
1,941,497 1,957,998
========== ==========
10 months 12 months
ended ended
31(st) 28(th)
Remuneration in respect Dec Feb
of Directors was as follows: 2014 2014
GBP GBP
Aggregate emoluments (including
benefits in kind) 475,000 655,264
Consultancy
fees 100,050 57,150
Other fees 25,000 40,000
---------- ----------
600,050 752,414
========== ==========
Company contribution to
money purchase pension
schemes 27,500 23,354
========== ==========
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
9. Employees (Continued)
10 months 12 months
ended ended
Remuneration for each 31(st) 28(th)
Director (including benefits Dec Feb
in kind) 2014 2014
GBP GBP
M. Kheriba - -
J. Alseddiqi - -
N. Barattieri
di San Pietro 416,667 213,000
K.B. Nilsson 158,383 127,150
E.B. Harris 25,000 30,000
M.F. Williams (resigned
27(th) March 2013) - 10,000
K. MacRae (resigned
19(th) June
2013) - 344,764
M.A. AlRafi
(resigned 25(th)
June 2013) - 10,000
A. de Rothschild
(resigned 11(th)
February 2014) - 17,500
---------- ----------
600,050 752,414
========== ==========
Remuneration of GBP25,000 (28(th) February 2014:
GBP30,000) for Director E.B. Harris is payable
to EC Harris LLP.
10 months 12 months
ended ended
Remuneration in respect of the 31(st) 28(th)
highest paid Director was as Dec Feb
follows: 2014 2014
GBP GBP
Aggregate emoluments (including
benefits in kind) 416,667 344,764
Company contribution to
money purchase pension
scheme 27,500 6,854
---------- ----------
444,167 351,618
========== ==========
The total emoluments of GBP416,667 (28(th) February
2014: GBP344,764) above includes compensation
for loss of office of GBPnil (28(th) February
2014: GBP251,500) and bonus of GBP187,500 (28(th)
February 2014: GBPnil).
The Directors consider that the key management
personnel for reporting purposes as defined by
IAS24 'Related Party Disclosures' are the Directors
themselves only.
10. Taxation 10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
GBP GBP
(a) Analysis
of charge in
year
Current tax:
Corporation tax
credit - -
Adjustment in
respect of prior
periods (347,727) 311,298
Total current
tax (347,727) 311,298
=========== ============
Deferred tax:
Deferred tax charge/(credit) 81,632 (208,305)
Total deferred tax
charge/(credit) 81,632 (208,305)
=========== ============
Total tax (credit)/charge (266,095) 102,993
=========== ============
(b) Factors affecting
the tax charge for
the year
The tax assessed for the year is lower than the
standard rate of corporation tax in the UK of
21% (2014: 23%).
The differences
are explained
below:
10 months 12 months
ended ended
31(st) 28(th)
Dec Feb
2014 2014
GBP GBP
(Loss)/Profit on
ordinary activities
before tax (1,858) 12,303,275
========== ============
(Loss)/Profit on ordinary activities
multiplied by the standard rate
of corporation tax of 21% (2014:
23%) (390) 2,829,753
Effects of:
Expenses not deductible
for tax purposes 2,339 19,851
Depreciation for the period
in excess of capital allowances 26,258 18,919
Dividends and
distributions
received (90,063) (3,450,000)
Utilisation
of tax losses (314,450) 666,704
Other timing
differences (103,709) (328,727)
Loss carried
forward 480,015 243,500
Consortium relief in respect
of prior periods (347,727) 311,298
Current tax (credit)/charge
for the period (347,727) 311,298
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
10. Taxation (continued)
(c) Factors that may affect future tax charges
The standard rate of corporation tax was reduced to 21% from
1(st) April 2014.
11. Profit of the parent company
As permitted by section 408 of the Companies
Act 2006, the profit or loss element of the Parent
Company Income Statement is not presented as
part of these financial statements. The Group
profit for the period ended 31(st) December 2014
of GBP264,237 (28(th) February 2014: GBP12,200,282)
includes a profit of GBP5,402,344 (28(th) February
2014: GBP44,703,358), which was dealt with in
the financial statements of the Company.
12. Goodwill
31(st) 28(th)
Group Dec 2014 Feb 2014
GBP GBP
Cost 14,940,474 14,940,474
----------- -----------
Amortisation and
impairment
At the beginning
of the year 6,933,057 6,933,057
Impairment charge
for the year - -
----------- -----------
At the end
of the year 6,933,057 6,933,057
----------- -----------
Net book value 8,007,417 8,007,417
=========== ===========
The Group performs an annual goodwill impairment
review in accordance with IAS 36 'Impairment
of Assets' based on its cash generating units
(CGUs). The CGU that has associated goodwill
allocated to it is the Group as a whole. This
is the smallest identifiable group of assets
that generate cash inflows to which goodwill
is allocated. Although the interior design business
is a separate CGU goodwill was not specifically
allocated to it when the goodwill arose because
it was treated as an integrated business when
the Group was originally restructured. The Directors
consider that it is now not appropriate to allocate
goodwill to this CGU.
Recoverable amount
In accordance with IAS 36 the recoverable amount
of the CGU is calculated, being the higher of
value in use and fair value less costs to sell.
The fair value less costs to sell of the CGU
is determined using cash flow projections derived
from the business plan covering a five year period
which has been approved by the Board. They reflect
the Directors' expectations of the level and
timing of revenue, expenses, working capital
and operating cash flows, based on past experience
and future expectations of business performance
particularly future development projects.
Discount rates
The pre-tax discount rate applied to the cash
flow projections are derived from the Group's
weighted average cost of capital. The discount
rate applied is 6% (28(th) February 2014: 6%)
reflecting the future expected cost of capital
for the Group.
Growth rates
Due to the nature of the Group's development
business growth rates are not relevant. The cash
flow projections assume a 100% probability of
receiving a level of development fees over the
five years and make assumptions on the probability
of achieving certain development performance
fee criteria.
The business growth rates have been assumed to
be 5% (28(th) February 2014: nil) for the N Studio
Limited interior design business.
Sensitivity analysis
The following percentage changes in assumptions
would cause the recoverable amount to fall below
the current carrying value:
-- A 91.5% increase in the discount rate to 97.5%
for the latter five year period
-- A 28% decrease in the development revenue
cash flows over the five year period
-- A decrease to nil in the other interior design
revenue cash flows over the five year period
would not cause the recoverable amount to fall
below the current carrying value.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
Property, plant
13. and equipment
Fittings
Group Leasehold and Office Computer
Improvements Equipment Equipment Total
Cost GBP GBP GBP GBP
At 1(st)
March 2013 1,115,434 70,672 208,469 1,394,575
Additions - 2,754 48,937 51,691
At 28(th)
February
2014 1,115,434 73,426 257,406 1,446,266
============= ===================== ========== ==========
Additions - 594 23,229 23,823
At 31(st)
December
2014 1,115,434 74,020 280,635 1,470,089
============= ===================== ========== ==========
Depreciation
At 1(st)
March 2013 236,677 45,643 193,026 475,346
Charge for
the year 113,604 10,544 24,033 148,181
At 28(th)
February
2014 350,281 56,187 217,059 623,527
============= ===================== ========== ==========
Charge for
the year 94,670 8,922 21,445 125,037
At 31(st)
December
2014 444,951 65,109 238,504 748,564
============= ===================== ========== ==========
Net book
value
At 31(st)
December
2014 670,483 8,911 42,131 721,525
============= ===================== ========== ==========
At 28(th)
February
2014 765,153 17,239 40,347 822,739
============= ===================== ========== ==========
At 28(th)
February
2013 878,757 25,029 15,443 919,229
============= ===================== ========== ==========
Fittings
Company Leasehold and Office Computer
Improvements Equipment Equipment Total
Cost GBP GBP GBP GBP
At 1(st)
March 2013 1,173,914 - - 1,173,914
Disposals - - - -
At 28(th)
February
2014 1,173,914 - - 1,173,914
============= =========== ========== ==========
Additions - - - -
At 31(st)
December
2014 1,173,914 - - 1,173,914
============= =========== ========== ==========
Depreciation
At 1(st)
March 2013 236,677 - - 236,677
Charge for
the year 113,604 - - 113,604
At 28(th)
February
2014 350,281 - - 350,281
============= =========== ========== ==========
Charge for
the year 94,670 - - 94,670
At 31(st)
December
2014 444,951 - - 444,951
============= =========== ========== ==========
Net book
value
At 31(st)
December
2014 728,963 - - 728,963
============= =========== ========== ==========
At 28(th)
February
2014 823,633 - - 823,633
============= =========== ========== ==========
At 28(th)
February
2013 937,237 - - 937,237
============= =========== ========== ==========
There were no assets held under finance lease or hire purchase
contracts.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
Available for
sale financial
(a) assets
14. Investments
28(th)
31(st) 31(st) 28(th) Feb
Group Dec 2014 Dec 2014 Feb 2014 2014
GBP GBP GBP GBP
At 1(st) March 8,824,659 22,148,579
Dividend received - (15,000,000)
Derecognition - (7,148,575)
Increase in 1 Palace
Street fair value 1,175,360 8,824,655
---------- -------------
Net movement transferred
to/(from) comprehensive
income 1,175,360 (13,323,920)
----------- -------------
At 31(st) December
2014 10,000,019 8,824,659
=========== =============
Net book value
At 31(st) December
2014 10,000,019 8,824,659
=========== =============
The increase in available for sale financial assets
represents the additional investment in the 1 Palace
Street Development.
The Company was committed to invest GBP10.0m into
the 1 Palace Street Development. At 31(st) December
2014 the Company had paid the commitment.
The GBP15 investment in 33 Thurloe Square represents
a 15% equity stake. The 33 Thurloe Square Development
was sold during the period and the GBP15 investment
will be refunded in the next financial year.
(b) Other investments
Company
Subsidiary Other Total
Undertakings Investments
GBP GBP GBP
Cost
At 1(st) March
2014 14,492,681 8,824,655 23,317,336
Additions - 1,175,360 1,175,360
As at 31(st)
December 2014 14,492,681 10,000,015 24,492,696
============== ============ ============
Impairment
At 1(st) March
2014 6,486,368 - 6,486,368
Impairment
in the year - - -
As at 31(st)
December 2014 6,486,368 - 6,486,368
============== ============ ============
Net book value
as at 31(st) December
2014 8,006,313 10,000,015 18,006,328
============== ============ ============
Net book value
as at 28(th) February
2014 8,006,313 8,824,655 16,830,968
============== ============ ============
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
(b) Other investments
(continued)
Company
Subsidiary Other Total
Undertakings Investments
GBP GBP GBP
Cost
At 1(st) March
2013 14,492,681 - 14,492,681
Additions - 8,824,655 8,824,655
As at 28(th)
February 2014 14,492,681 8,824,655 23,317,336
============== ============ ============
Impairment
At 1(st) March
2013 6,485,260 - 6,485,260
Impairment
in the year 1,108 - 1,108
As at 28(th)
February 2014 6,486,368 - 6,486,368
============== ============ ============
Net book value
as at 28(th) February
2014 8,006,313 8,824,655 16,830,968
============== ============ ============
Net book value
as at 28(th) February
2013 8,007,421 - 8,007,421
============== ============ ============
(c) Group shareholdings
The Group has shareholdings in the
following companies, all incorporated
in England and Wales:
Subsidiary Proportion
undertakings Holding held Nature of Business
Waterloo Investments Ordinary Development
Limited shares 100% management services
Ordinary
N Studio Limited shares 100% Interior design
Northacre Development Ordinary Development
Management shares 100% management services
Services Limited
Nilsson Architects Ordinary Design
Limited shares 100% architects
Northacre
Capital (1) Ordinary
Limited shares 100% Dormant
Northacre
Capital (3) Ordinary
Limited shares 100% Dormant
Northacre
Capital (5) Ordinary
Limited shares 100% Property development
Northacre
Capital (7) Ordinary
Limited shares 100% Property development
Northacre
International Ordinary
Limited shares 100% Dormant
Lancaster Gate
(Hyde Park) Ordinary
Limited shares 100% Property development
Intarya Limited changed its name to N Studio Limited
on 9(th) October 2014.
The holding in Lancaster Gate (Hyde Park) Limited
is held by Northacre Capital (5) Limited.
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
15. Inventories Group
31(st) 28(th)
Dec Feb
2014 2014
GBP GBP
Stock 2,928 9,099
Work in progress 4,189,195 159,460
---------------- ------------
4,192,123 168,559
================ ============
The Company had no stock or work in progress in either
the prior or current reporting period.
Trade and other
16. receivables Group Company
31(st) 28(th) 31(st) 28(th)
Dec Feb Dec Feb
2014 2014 2014 2014
GBP GBP GBP GBP
Trade receivables 31,568 3,763,209 - -
Amounts owed
by group undertakings - - 8,567,254 7,096,422
Other receivables 220,038 2,734,177 110,908 2,891,453
Prepayments and
accrued income 535,604 170,325 321,056 122,218
-------- ---------- ---------- -----------
787,210 6,667,711 8,999,218 10,110,093
======== ========== ========== ===========
At the period end there was no provision for doubtful
debts (28(th) February 2014: GBPnil). Included within
other receivables is a total of GBPnil (28(th) February
2014: GBP1,459,774) which represented amounts paid
on behalf of Bassamey Property Holdings Limited, a
vehicle which acquired the 33 Thurloe Square project.
The shareholder loan was repaid following the sale
of the project in June 2014.
A deferred tax asset of GBPnil (28(th) February 2014:
GBP208,305) has been recognised on losses carried
forward and is included in other receivables.
Trade and other
17. payables Group Company
31(st) 28(th) 28(th)
Dec Feb 31(st) Feb
2014 2014 Dec 2014 2014
GBP GBP GBP GBP
Trade payables 67,555 297,211 34,720 54,223
Amounts owed
to group undertakings - - 1,141,065 8,411,065
Social security
and other taxes 199,440 534,829 130,186 16,092
Other payables 2,064 5,055 1,589 2,270
Accruals and
deferred income 569,325 5,778,440 268,513 1,297,011
838,384 6,615,535 1,576,073 9,780,661
======== ========== ========== ==========
Borrowings, including
18. lease finance Group Company
31(st) 28(th) 31(st) 28(th)
Dec Feb Dec Feb
Current Liabilities 2014 2014 2014 2014
GBP GBP GBP GBP
Bank loan 1,000,000 - - -
----------- -------- ------- -------
1,000,000 - - -
=========== ======== ======= =======
A loan facility of GBP3,150,000 was made available
by the Royal Bank of Scotland from the 19(th) September
2014 to Northacre Capital (7) Limited in respect of
the property at 22 Prince Edward Mansions. The loan
is available on a drawdown basis and as at 31(st)
December 2014 GBP1,000,000 was drawn. The loan incurs
interest at 3.25% above the LIBOR rate and is charged
quarterly. The loan is due to be repaid the earlier
of the latest expiry date of the current interest
period outstanding as at the date of completion of
sale of the property or the date which falls 18 months
after the date on which the loan is drawn. The loan
is expected to be repaid in full prior to the end
of the next financial year. The loan is secured via
a first legal charge over the property included within
inventories under the heading of work in progress,
a guarantee for GBP120,000 given by Northacre PLC
and a charge over certain cash balances.
Corporation
19. tax Group Company
31(st) 28(th) 28(th)
Dec Feb 31(st) Feb
2014 2014 Dec 2014 2014
GBP GBP GBP GBP
Corporation
Tax - - - -
------- ------- ---------- -------
- - - -
======= ======= ========== =======
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
20. Future financial commitments
Operating leases Group Company
31(st) 28(th) 31(st) 28(th)
Dec Feb Dec Feb
2014 2014 2014 2014
GBP GBP GBP GBP
Land Land Land Land
& Buildings & Buildings & Buildings & Buildings
Net amount payable
on operating leases
which expire:
Within one year 147,975 147,975 147,975 147,975
In two to five years 591,900 591,900 591,900 591,900
In over five years 206,760 330,815 206,760 330,815
------------- ------------- ------------- -------------
946,635 1,070,690 946,635 1,070,690
============= ============= ============= =============
Group Company
Operating leases 31(st) 28(th) 31(st) 28(th)
Dec Feb Dec Feb
2014 2014 2014 2014
GBP GBP GBP GBP
Other Other Other Other
Net amount payable
on operating leases
which expire:
Within one year 29,148 31,804 12,920 12,920
In two to five years 7,042 33,465 6,460 19,380
In over five years - - - -
36,190 65,269 19,380 32,300
======= ======= ======= =======
21. Capital commitments
At the reporting date there were no outstanding
commitments for capital expenditure.
Earnings
22. per share
Profit per share of 0.62p (28(th) February 2014:
39.51p) is calculated on the profit attributable
to Ordinary shares of GBP264,237 (28(th) February
2014: GBP12,200,282) divided by the weighted number
of Ordinary shares in issue during the period.
Computation of
basic earnings 31(st) 28(th)
per share: Dec 2014 Feb 2014
Net profit GBP264,237 GBP12,200,282
Weighted average number
of shares outstanding 42,335,538 30,879,049
Basic profit per
share 0.62p 39.51p
Diluted profit
per share 0.62p 39.51p
There were no potentially dilutive instruments in
issue during the current or preceding period. All
amounts shown relate to continuing operations.
23. Equity
28(th)
31(st) Feb
Share capital Dec 2014 2014
GBP GBP
Called up, allotted
and fully paid:
42,335,538 (28(th) February
2014: 42,335,538) Ordinary
shares of 2.5p each 1,058,388 1,058,388
------------ --------------
1,058,388 1,058,388
============ ==============
Share premium account Share Merger
and reserves premium reserve
GBP GBP
At 1(st) March
2014 22,565,287 8,086,293
Dividends
paid - (8,086,293)
At 31(st)
December
2014 22,565,287 -
============ ==============
The share premium account represents the incremental
paid up capital above the nominal value of the Ordinary
shares of 2.5p issued.
The merger reserve was created in December 2013
on the issue of 10,433,927 shares to Spadille Limited
in consideration for the acquisition of NTA CB
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
23. Equity (continued)
Limited (Cash Box Acquisition) with sole assets of GBP8,347,142.
NTA CB Limited has been dissolved following the completion of the
transaction. The merger reserve was cancelled on declaration of
dividends in August 2014.
24. Dividends
31(st) 28(th)
Dec 2014 Feb 2014
GBP GBP
A special dividend paid during
the period of 35.43p (28(th)
February 2014: 40p) 14,999,481 10,689,457
----------- -----------
14,999,481 10,689,457
=========== ===========
No further dividends have been declared prior to
the approval of these financial statements and the
Board will continue to actively consider the payment
of dividends.
25. Contingent liabilities
The Company is included in a group registration for VAT purposes
and is therefore jointly and severally liable for all other group
companies' VAT liabilities amounting to GBPnil (28(th) February
2014: GBP477,048).
Related party
26. transactions
Group
The Group's related parties as defined by International
Accounting Standard 24 (revised), the nature of the
relationship and the amount of transactions
with them during the period
were as follows:
10 months 12 months
ended ended
Nature 31(st) Dec 28(th) February
of 2014 2014
Related Nature of
Party Relationship GBP GBP GBP GBP Transactions
Balance Total Balance
Total at transactions at
transactions the in the
in the period the year
period end year end
Consultancy
fees for
K. Nilsson 1 100,050 - 57,150 (57,150) services
provided for
the 1 Palace
Street
project
for the
period
March 2014
to December
2014. The
consultancy
fees were
invoiced
to Palace
Revive
Development
Limited and
paid by that
company post
year end
Non-executive
Directors'
E.B. Harris 2 25,000 (25,000) 30,000 (30,000) fees for
the March
2014
to December
2014 invoiced
from E.C.
Harris
LLP
Non-executive
Directors'
M. Williams 3 - - 10,000 - fees for
March 2013
Executive
Directors'
M.A. AlRafi 4 - - 10,000 - fees for the
period March
2013 to June
2013
Bonus of
GBP1,000,000
M.A. AlRafi 4 - - - (975,000) was payable
from The
Lancasters
Development
dividends.
GBP25,000 was
paid on
28(th)
November 2012
and the
balance
of GBP975,000
was paid on
28(th) March
2014
Non-executive
A. de Directors'
Rothschild 5 - (17,500) 17,500 (17,500) fees for
the period
July 2013 to
February 2014
Consultancy
fees charged
ADCM Limited 6 1,042,466 - 1,100,000 - for the
period March
2014 to
December
2014 with
GBP1,200,000
being paid
in the period
Expenses
charged
ADCM Limited 6 63,310 1,882 116,544 27,596 by ADCM
Limited as
per the
consultancy
agreement.
GBP1,882
represents
a credit from
ADCM Limited
outstanding
at the period
end
Notes to the Consolidated Financial Statements
For the 10 months ended 31(st) December 2014 (Continued)
Related party
26. transactions (continued)
10 months 12 months
ended ended
Nature 31(st) Dec 28(th) February
of 2014 2014
Related Nature of
Party Relationship GBP GBP GBP GBP Transactions
Balance Total Balance
Total at transactions at
transactions the in the
in the period the year
period end year end
Development
Palace management
Revive 7 - - 2,705,004 - fees
Development invoiced for
Limited the period
January 2014
to December
2014 as per
the
development
management
agreement.
GBP2,705,004
was received
in advance
in the prior
year for the
period
January
2014 to
December
2014
Expenses
paid
Palace on behalf of
Revive 7 166,317 - 58,949 10,770 Palace
Development Revive
Limited Development
Limited. The
GBP10,770 at
the prior
year
end
represented
expenses
paid
but not
reclaimed
Amount
invested
Palace by Northacre
Real Estate 8 1,175,360 10,000,000 8,824,640 8,824,640 PLC
Partners into Palace
LP Real Estate
Partners LP
to develop
the 1 Palace
Street
project
Nature of
Relationships
K.B. Nilsson is
a Director of the
1 Company.
E.B. Harris is a Director of
the Company, and a member of
2 E.C. Harris LLP.
M. Williams was a Director
of the Company (resigned on
3 27(th) March 2013).
M.A. AlRafi was a Director
of the Company (resigned on
4 25(th) June 2013).
A. de Rothschild was a Director
of the Company (resigned on
5 11(th) February 2014)
ADCM Limited is a fully owned subsidiary of ADFG,
6 the Group's ultimate parent company.
Palace Revive Development Limited is a company set
up to develop the 1 Palace Street Development and
7 is controlled by ADCM Limited.
Palace Real Estate Partners LP is a partnership that
controls Palace Revive Development Limited. Northacre
8 PLC is a limited member of Palace Real Estate
Partners LP.
Company
The Directors' and pension fund transactions in the
Company are included in the Group disclosure above.
In addition to these, the Company has the following
related party transactions as defined by International
Accounting Standard 24 (revised).
10 months 12 months
ended ended
Nature 31(st) Dec 28(th) February
of 2014 2014
Nature of
Related Party Relationship GBP GBP GBP GBP Transactions
Total Balance Total Balance
transactions at transactions at
in the in the
the year the year
period period year end
Management
Group entities 1 216,712 - 231,000 - fees receivable
in the period
from Group
subsidiaries
provided
at arm's
length
Management
fees payable
Group entities 1 (42,655) - (60,000) - in
the period
to Group
subsidiaries
provided
at arm's
length
Nature of
Relationships
The Group entities are
wholly owned subsidiaries
1 of the Company.
The balances at the reporting date are shown under notes
16 and 17 of the Consolidated Financial Statements.
27. Immediate and ultimate parent undertakings
The immediate and ultimate parent undertakings are Spadille
Limited, a company incorporated in England and Wales, and Abu Dhabi
Financial Group LLC, a company incorporated in United Arab
Emirates, respectively.
This information is provided by RNS
The company news service from the London Stock Exchange
END
NORBDGDSIBXBGUG
Northacre (LSE:NTA)
Historical Stock Chart
From May 2024 to Jun 2024
Northacre (LSE:NTA)
Historical Stock Chart
From Jun 2023 to Jun 2024
