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TDH - Tradehold Limited - Reviewed results for the 12 months to 28 February 2011
("Tradehold" or "the company") (Registration number 1970/009054/06)
JSE share code: TDH ISIN: ZAE000026902
Reviewed Audited
Statement of comprehensive income 12 months to 12 months to
(GBP`000) 28/02/11 28/02/10
Revenue 5 929 4 783
Trading profit 6 110 2 448
Exceptional items (2 112) 1 393
Operating profit 3 998 3 841
Interest received 216 418
Interest paid (2 281) (2 262)
Profit before taxation 1 933 1 997
Taxation (15) (354)
Profit for the year 1 948 2 351
Other comprehensive income
Currency translation differences (11) -
Total comprehensive income for the year 1 937 2 351
Profit/(loss) attributable to:
Owners of the parent 1 220 2 371
Non-controlling interest 728 (20)
1 948 2 351
Total comprehensive income/(loss) attributable to:
Owners of the parent 1 209 2 371
Non-controlling interest 728 (20)
1 937 2 351
Earnings/(loss) per share (pence): basic and diluted
before exceptional items 9,6 2,8
basic 3,5 6,8
headline (loss)/earnings (9,7) 3,8
Number of shares for calculation of earnings
per share (`000) 34 654 34 676
Statement of financial position Reviewed Audited
(GBP`000) 28/02/11 28/02/10
Non-current assets 57 530 52 221
Property, plant and equipment 6 126 6 900
Investment properties 51 385 45 167
Financial assets 19 154
Current assets 20 874 20 652
Financial assets 9 762 7 679
Trade and other receivables 2 054 2 026
Non-current assets held for sale - 332
Inventories 29 26
Cash and cash equivalents 9 029 10 589
Total assets 78 404 72 873
Equity 31 349 29 436
Ordinary shareholders` equity 30 304 29 095
Non-controlling interest 1 045 341
Non-current liabilities 7 855 26 545
Preference share capital 12 12
Long-term borrowings 7 843 26 533
Current liabilities 39 200 16 892
Short-term borrowings 33 707 14 678
Other current liabilities 5 493 2 214
Total equity and liabilities 78 404 72 873
Reviewed Audited
Statement of cash flows 12 months to 12 months to
(GBP`000) 28/02/11 28/02/10
Cash flows from operating activities (1 582) (745)
Cash flows from investing activities (293) (4 861)
Acquisition of investment properties (82) (4 459)
Acquisition of property, plant and equipment (57) (430)
Proceeds on disposal of investment properties - 453
Proceeds on disposal of property, plant and equipment 6 -
Other investment activities (160) (425)
Net cash flow (1 875) (5 606)
Cash flows from financing activities 315 (53)
Proceeds from borrowings 3 467 7 664
Repayment of borrowings (3 128) (7 717)
Transactions with non-controlling shareholders (24) -
Net decrease in cash and cash equivalents (1 560) (5 659)
Cash and cash equivalents at beginning of the year 10 589 16 248
Cash and cash equivalents at end of the year 9 029 10 589
Statement of changes in equity
Reviewed Audited
12 months to 12 months to
(GBP`000) 28/02/11 28/02/10
Balance at beginning of the year 29 436 27 111
Transactions with non-controlling shareholders (24) -
Purchase of treasury shares - (26)
Total comprehensive income for the year 1 937 2 351
Balance at end of the year 31 349 29 436
Supplementary information
Reviewed Audited
12 months to 12 months to
(GBP`000) 28/02/11 28/02/10
1. Depreciation for the year 403 234
2. Capital expenditure for the year 139 5 527
3. Calculation of headline earnings
Net profit 1 220 2 371
Surplus on revaluation of investment properties (5 804) (1 046)
Profit on sale and scrapping of property,
plant and equipment and investment properties (6) (21)
Impairment of property, plant and equipment 428 -
Taxation - -
Non-controlling interest 806 -
(3 356) 1 304
Reviewed Audited
(GBP`000) 28/02/11 28/02/10
4. Number of shares in issue
(net of treasury shares) (`000) 34 654 34 654
5. Net asset value per share (pence) 87,4 84,0
6. Financial assets
Listed investments at fair value 7 832 5 867
Unlisted investments at fair value 1 812 1 812
Loans 137 154
9 781 7 833
7. Contingent liabilities 5 428 7 722
Segmental analysis Trading Total
(GBP`000) Revenue profit/(loss) assets
Twelve months to
28 February 2011 (reviewed)
Property - retail 2 361 9 316 38 634
- commercial 268 (972) 7 283
- offices 542 (397) 5 545
- leisure 2 708 (31) 7 376
- other 50 3 1 831
Treasury - (1 809) 17 735
5 929 6 110 78 404
Twelve months to
28 February 2010 (audited)
Property - retail 2 162 4 285 30 462
- commercial 303 (525) 8 094
- offices 437 (271) 6 146
- leisure 1 881 402 7 973
- other - (287) 1 685
Treasury - (1 156) 18 513
4 783 2 448 72 873
Tradehold Limited is an investment holding company listed on the Main Board of
the JSE. It has no operating assets in South Africa. Its business consists of an
indirect holding of 15,9% in the UK-based Instore and an 85% interest in the
property-owning Moorgarth group of companies, which is also based in the United
Kingdom. Moorgarth manages a GBP56,8 million portfolio of retail, commercial and
industrial buildings while Instore`s principal activity is variety retailing.
Even though the UK property market is still in a slow recovery phase following
the very serious decline since the start of the recession, Tradehold recorded a
bottom-line profit of GBP1,9 million (2010: GBP2,4 million). Moorgarth produced
robust profits given a net GBP5,4 million uplift in the value of its properties.
The sale of a large property portfolio, unrelated to and prior to the
establishment of Moorgarth, resulted in write-offs of GBP4,5 million during the
year.
Business environment
The UK economy remained in a state of uncertainty as the coalition government`s
austerity measures, marked by tax rises, benefit cuts and public-sector pay
freezes, started to take effect. The recovery remained fragile with the economy
contracting 0,6% in the last quarter of 2010. Growth for the present year is
projected at 1,7% while inflation has rushed ahead to reach 4,4% at the end of
the reporting period.
Moorgarth
In the property sector, demand for space remained weak and business confidence
low, albeit slightly higher than in the last few years. A shortage of funding
continued in all business sectors making cash a vital ingredient of any
business. The UK property market became more polarised. While prime properties
in Central London experienced a resurgence in demand and value, the opposite
applied to properties not considered prime. The value of the latter remained low
and vulnerable during the reporting period. Little quality stock came on to the
market and the ones that did, tended to be snapped up by cash-rich institutions.
Finding properties in the middle market offering real value remained a
challenge.
During the review period, Moorgarth`s property portfolio nevertheless remained
quite resilient to the recessionary conditions. Management continued to focus on
maximising the value of the group`s existing properties. The success achieved by
this approach is reflected in a revaluation surplus of GBP5,4 million at the end
of the reporting period. This brought the overall value of the portfolio to
GBP56,8 million (2010: GBP51,5 million). The size of the Group`s portfolio
remained unchanged at 22 properties. Management worked hard to restrict tenant
losses and vacant space remained within manageable parameters, enabling the
group to achieve an after-tax profit of GBP4,8 million (2010: GBP0,8 million).
Comments on the results
The trading profit includes the net surplus of GBP5,4 million (2010: GBP1,0
million) on the revaluation of properties.
Exceptional items
Exceptional items are made up as follows:
(GBP`million) 2011 2010
Fair value adjustment: UBS AG investment 2,0 1,5
Fair value adjustment: Instore investment - 0,4
Legal and professional expenditure* (1,6) (0,5)
Provision for lease repair liabilities* (2,9) -
Recovery of lease guarantee payments 0,6 -
Impairment of loans (0,2) -
Total (2,1) 1,4
*Both these amounts relate to write-offs during the year resulting from the sale
of a large property portfolio prior to the establishment of Moorgarth. The lease
repair liability was previously reported as a contingent liability.
Dividend
To preserve the maximum available cash in the business and in the light of the
uncertainties that characterise present market conditions, the board does not
recommend paying a dividend to shareholders.
Outlook
The R650 (GBP59m) million raised during the recent successful rights issue,
which occurred after year-end, will enable Tradehold to take advantage of the
anticipated growing number of opportunities to expand its property portfolio
with larger quality acquisitions that, up to now, has been outside its financial
reach.
Accounting policy
The results for the 12 months to 28 February 2011 are prepared in accordance
with the recognition and measurement principles of International Financial
Reporting Standards, including IAS 34: Interim Financial Reporting, and the AC
500 standards, as issued by the Accounting Practices Board or its successor, and
in accordance with the requirements of the Companies Act No.61 of 1973 and the
Listings Requirements of the JSE Limited. The accounting policies are consistent
with those applied in the annual financial statements for the year ended 28
February 2010, except for IFRS 3: Business combinations (Revised 2008) and IAS
27: Consolidated and Separate Financial Statements (Revised 2008).
Tradehold`s auditors, PricewaterhouseCoopers Inc., reviewed the results and
their unqualified report is available at Tradehold`s registered office.
Reporting currency
As the operations of Tradehold`s subsidiaries are conducted in pound sterling
and because of the distortion caused by the fluctuating value of the rand, the
company is reporting its results in the former currency.
CH Wiese C Moore
Chairman Director
Luxembourg
16 May 2011
Sponsor
One Capital
Date: 20/05/2011 11:55:01 Supplied by www.sharenet.co.za
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