RNS Number : 1544F
Sutton Harbour Group PLC
11 July 2019
 

 

11 July 2019

 

SUTTON HARBOUR GROUP PLC ("the Group")

 

Preliminary results for the year ended 31 March 2019

 

Sutton Harbour Group plc ("Sutton Harbour", "the Company"), the AIM listed waterfront regeneration and destination specialist, announces preliminary results for the year ended 31 March 2019.

 

Highlights

·      In November 2018, the Company received planning approval for two new residential schemes at Sutton Harbour: 'Harbour Arch Quay' and 'Sugar Quay' together with approval for a two storey extension to the existing multi-storey Harbour Car Park.

·      In December 2018 the Company held a general meeting at which shareholders approved the issue of 10,344,951 new ordinary shares via an Open Offer to existing shareholders. This issue was fully subscribed and resulted in a fresh equity injection of £3 million (before costs) to be used in the ongoing development of the Company including pre-construction costs in respect of planning consented schemes 'Harbour Arch Quay' and 'Sugar Quay' and to meet capital maintenance costs and other funding requirements across its ordinary and development activities.

·      In March 2019, the Government Inspectors' report concerning the Local Authority's new planning framework was issued which affirmed safeguarding for a period not to exceed five years of the former airport site for possible general aviation use.

·      In April 2019, the Company changed its name to Sutton Harbour Group plc and is currently rolling out its new corporate identity

 

Financial

 

·      Adjusted profit before tax* £0.072m (2018: loss £0.136m)

·      Net financing costs £0.901m (2018: £0.897m)

·      Net Assets £45.7m (2017: £39.3m)

·      Valuation of property portfolio** £45.7m (2018: £42.7m)

·      Year-end net debt £21.4m (2017: £21.9m)

 

*Before accounting for fair value adjustments on assets and costs of change in ownership.

**Comprises investment and owner occupied portfolios. Excludes land held as development inventory.

 

Philip Beinhaker, Executive Chairman, commented:

"The Company has continued to deliver on its vision to be the leading marine, waterfront regeneration and destination specialist in Southern England in accordance with its stated strategy. We have delivered major new planning consents, completed in-depth reviews of other trading activities and put strategic plans for growth in place".

 

For further information, please contact

 

Sutton Harbour Group plc

Philip Beinhaker - Executive Chairman

Natasha Gadsdon - Finance Director

 

01752 204186

Arden Partners (Nomad and Broker)

Paul Shackleton

Benjamin Cryer

 

020 7614 5900

 

 

Executive Chairman's Statement

Year Ended 31 March 2019

 

Shareholder's Overview

·      In November 2018, the Company received planning approval for two new residential schemes at Sutton Harbour: 'Harbour Arch Quay' and 'Sugar Quay' together with approval for a two storey extension to the existing multi-storey Harbour Car Park.

·      In December 2018 the Company held a general meeting at which shareholders approved the issue of 10,344,951 new ordinary shares via an Open Offer to existing shareholders. This issue was fully subscribed and resulted in a fresh equity injection of £3 million (before costs) to be used in the ongoing development of the Company including pre-construction costs in respect of planning consented schemes 'Harbour Arch Quay' and 'Sugar Quay' and to meet capital maintenance costs and other funding requirements across its ordinary and development activities.

·      In March 2019, the Government Inspectors' report concerning the Local Authority's new planning framework was issued which affirmed safeguarding for a period not to exceed five years of the former airport site for possible general aviation use.

·      In April 2019, the Company changed its name to Sutton Harbour Group plc and is currently rolling out its new corporate identity

Results and Financial Position

The adjusted profit before taxation for the year was £0.072m (2018: £0.135m loss) which excludes non-cash fair value adjustments and the costs in connection with the change of ownership. The profit before taxation for the year under review as per the Income Statement, inclusive of the aforementioned adjustments, was £1.516m (2018: £2.502m Loss before taxation).

As at 31 March 2019, net assets were £45.732m (2018: £39.328m), representing 39.4p per share (2018: 37.2p per share). The increase follows the issue of 10,344,951 new ordinary shares at 29 pence each, providing new capital of £3m, before costs of £73,000, and also the valuation of the Company's property assets which gave rise to an overall valuation surplus of £3.084m. Gearing as at 31 March 2019 stood at 46.7% (2018: 55.6%). Net finance costs increased to £0.901m in the year (2018: £0.897m) as the bank borrowing rate had increased by 0.25% and average borrowing compared year to year was higher.

Net debt (including finance leases) decreased to £21.373m at 31 March 2019 from £21.858m at 31 March 2018. Development Inventories increased by £2.281m reflecting the investment required to progress three schemes to planning consented status and a further £0.303m was invested in the Company's infrastructure asset base.

The board does not recommend payment of a dividend on the year's results.

Directors and Staff

Early in the financial year Philip Beinhaker was appointed Executive Chairman and Jason Schofield, Chief Executive left the Company in July 2018. The board has advertised a Chief Operating Officer position and intends to announce a new board appointment in the near future. There have been no other changes at board level during the year.

Headcount as at 31 March 2019 decreased to 30 (31 March 2018: 33) as the Company has continued to outsource certain specialist roles following some voluntary resignations.

Operations Report

MARINE

Overall, the marine segment has performed steadily during the year. The Marinas both achieved modest growth in revenue and occupancy and this encouraging trend has continued into the start of the new 2019/20 berthing season. Results from fishing activities were undermined by a poorer level of fish stocks in local waters with landings of fish by value down 23.5% on the previous financial year. Despite lower revenue from fish landing dues, other revenues including fuel sales, ice sales and rentals of property at the Plymouth Fisheries facility held up well during the year under review.

REAL ESTATE AND CAR PARKING

Focused marketing of vacant property has resulted in the occupancy rate increasing to 94% as at 31 March 2019 from 87% as at 31 March 2018. During the year seven new tenancies have been completed, and the Company has been pleased to see more businesses, in both professional businesses services and restaurant sectors, choose Sutton Harbour as a trading base.

Car Parking revenue increased slightly during the year, compared to the previous year. Parking at the Harbour Car Park continued to be affected by the out of action footbridge which links this car park more directly to the eastern side of the harbour where popular attractions including the Barbican and the Hoe are situated. The bridge was returned to full service on 19 April 2019 after a new bearing was fabricated and the structure recommissioned in time for the busier summer season. Early in 2019 the car parks contract with a third party specialist management company was renewed on improved terms.

REGENERATION

Sutton Harbour

The Company gained planning approval for two new landmark residential led schemes for Sutton Harbour in November 2018. The Harbour Arch Quay development of 14 flats and The iconic Sugar Quay building with 170 apartments are both due to start construction by the end of the year. The two storey Harbour Car Park extension, which will accommodate a further 114 parking spaces, is also due to start late 2019, with the additional parking to be available for use in summer 2020. The Company is engaging with local stakeholders, including Plymouth City Council, on events to be held in 2020 to commemorate the 400th anniversary of the departure of the Pilgrim Fathers on the Mayflower vessel to America. The historic port of Sutton Harbour is the focal point for commemorative events and the Company is making ready for the expected high number of visitors to the area.

Former Airport Site

The Company continues to manage and maintain the Former Airport Site which closed in December 2011. The 113 acre site, which is already surrounded by urban development, is ideally located for mixed urban use, and can deliver a sustainable built environment for the economic and social wellbeing of the people of Plymouth. The safeguard of the site for possible general aviation use is provided for the next five years, after which the Government Inspectors consider a prolonged safeguard to be inappropriate due to the value of the land for urban uses. The Company had prepared an initial masterplan for mixed use development for the site and continues to refine this to ensure its formulation as a development programme is deliverable in phases to meet planning framework policy and an aspiration for a new sustainable urban neighbourhood.

SUMMARY AND OUTLOOK

The Company has continued to deliver on its vision to be the leading marine, waterfront regeneration and destination specialist in Southern England in accordance with its stated strategy. We have delivered major new planning consents, completed in-depth reviews of other trading activities and put strategic plans for growth in place.

 

PHILIP BEINHAKER                             

Executive Chairman                           

 

10 July 2019

 

Consolidated Income Statement

For the year ended 31 March 2019

 

 

 

2019

2018

 

 

£000

£000

 

 

 

 

 

 

 

 

Revenue

 

6,893

6,503

 

 

 

 

Cost of sales

 

(4,686)

(4,367)

                       

 

 

 

Gross profit

 

2,207

2,136

 

 

 

 

Fair value adjustments on investment properties and fixed assets

 

1,444

(626)

Administrative expenses

 

(1,234)

(1,374)

Exceptional costs of change in ownership

 

-

(1,741)

 

 

 

 

Operating profit/(loss)

 

2,417

(1,605)

 

 

 

 

Finance income

 

1

-

Finance costs

 

(902)

(897)

Net finance costs

 

(901)

(897)

 

 

 

 

Profit/(loss) before tax from continuing operations

 

1,516

(2,502)

Taxation credit on profit/(loss) from continuing operations

 

315

304

Profit/(loss) for the year from continuing operations

 

1,831

(2,198)

 

 

 

 

Profit/(loss) for the year attributable to owners of the parent

 

1,831

(2,198)

 

 

 

 

 

 

 

 

Basic and diluted earnings/(loss) per share

 

 

 

from continuing operations

 

1.68p

(2.24)p

 

 

 

 

 

 

 

 

 

 

 

           

 

Consolidated Statement of Other Comprehensive Income for

the year ended 31 March 2019

 

 

 

 

 

2019

2018

 

 

£000

£000

 

 

 

 

 

 

 

 

Profit/(loss) for the year

 

1,831

(2,198)

Items that will not be reclassified subsequently to profit or loss:

 

 

 

Revaluation of property, plant and equipment

 

1,640

(1,624)

Items that may be reclassified subsequently to profit or loss:

 

 

 

Effective portion of changes in fair value of cash flow hedges

 

6

70

 

 

 

 

Other comprehensive income for the year, net of tax

 

1,646

(1,554)

 

 

 

 

Total comprehensive income for the year attributable to owners of the parent

 

3,477

(3,752)

 

 

Consolidated Balance Sheet

As at 31 March 2019

 

 

2019

2018

 

£000

£000

 

 

 

Non-current assets

 

 

Property, plant and equipment

26,632

23,973

Investment property

19,425

19,055

Inventories

12,448

 

 

 

 

 

58,505

43,028

 

 

 

Current assets

 

 

Inventories

11,119

21,276

Trade and other receivables

2,283

2,170

Cash and cash equivalents

1,296

2,767

Tax recoverable

(5)

8

 

 

 

 

14,693

26,221

 

 

 

Total assets

73,198

69,249

 

 

 

Current liabilities

 

 

Trade and other payables

1,496

1,633

Finance lease liabilities

122

117

Deferred income

1,398

1,434

Provisions

70

70

Derivative financial instruments

-

6

 

 

 

 

3,086

3,260

 

 

 

Non-current liabilities

 

 

Bank loans

22,500

24,350

Finance lease liabilities

47

158

Deferred government grants

646

646

Deferred tax liabilities

1,023

1,338

Provisions

164

169

 

 

 

 

24,380

26,661

 

 

 

Total liabilities

 

 

 

27,466

29,921

 

Net assets

45,732

39,328

 

 

 

Issued capital and reserves attributable to owners of the parent

 

 

Share capital

16,266

16,162

Share premium

10,695

7,872

Other reserves

11,696

10,050

Retained earnings

7,075

5,244

 

 

 

 

Total equity

45,732

39,328

 

 

 

 

Consolidated Statement of Changes in Equity

For the year ended 31 March 2019

 

 

 

 

 

 

 

 

 

 

Share

capital

Share

premium

Revaluation reserve

Merger reserve

Hedging reserve

Retained earnings

Total

equity

 

 

 

------------Other reserves------------

 

 

 

£000

£000

£000

£000

£000

£000

£000

 

 

 

 

 

 

 

 

Balance at 1 April 2017

16,069

5,368

7,809

3,871

(76)

7,442

40,483

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income/(expense)

 

 

 

 

 

 

 

Loss for the year

-

-

-

-

-

(2,198)

(2,198)

Other comprehensive expense

 

 

 

 

 

 

 

Revaluation of property, plant and equipment

-

-

(1,624)

-

-

-

(1,624)

Effective portion of changes in fair value of cash flow hedges

-

-

-

-

70

-

70

 

 

 

 

 

 

 

 

Total other comprehensive expense

-

-

(1,624)

-

70

-

(1,554)

Total comprehensive income/(expense)

-

-

(1,624)

-

70

(2,198)

(3,752)

Transactions with owners of the

parent

Purchase of shares

 

 

93

 

 

2,504

 

 

-

 

 

-

 

 

-

 

 

-

 

 

2,597

Total balance at 31 March 2018

16,162

7,872

6,185

3,871

(6)

5,244

39,328

Balance at 1 April 2018

16,162

7,872

6,185

3,871

(6)

5,244

39,328

 

 

 

 

 

 

 

 

Comprehensive income/(expense)

 

 

 

 

 

 

 

Profit for the year

-

-

-

-

-

1,831

1,831

Other comprehensive income/(expense)

 

 

 

 

 

 

 

Revaluation of property, plant and equipment

-

-

1,640

-

-

-

1,640

Effective portion of changes in fair value of cash flow hedges

-

-

-

-

6

-

6

 

 

 

 

 

 

 

 

Total other comprehensive expense

 

 

1,640

 

6

 

1,646

Total other comprehensive income/(expense)

-

-

1,640

-

6

1,831

3,477

Transactions with owners of the parent

 

 

 

 

 

 

 

Purchase of shares

104

2,823

-

-

-

-

2,927

Total balance at 31 March 2019

16,266

10,695

7,825

3,871

-

7,075

45,732

                     

 

 

 

Consolidated Cash Flow Statement

For the year ended 31 March 2019

 

2019

2018

 

£000

£000

 

Cash used from total operating activities

(1,181)

(886)

 

 

 

 

 

 

Cash flows from investing activities

 

 

Net expenditure on investment property

(60)

-

Expenditure on property, plant and equipment

(243)

(227)

Proceeds from sale of plant and equipment

-

12

 

 

 

Net cash used in investing activities

(303)

(215)

 

 

 

Cash flows from financing activities

 

 

Proceeds from issue of shares

3,000

2,750

Expenses of share issuance

(73)

(152)

Interest paid

(958)

(897)

Loan (repayment)

(1,850)

-

Loan drawdown

-

1,550

Cash payments of finance leases

(106)

(86)

 

 

 

Net cash generated from financing activities

13

3,165

 

 

 

Net (decrease) / increase in cash and cash equivalents

(1,471)

2,064

 

 

 

Cash and cash equivalents at beginning of the year

2,767

703

 

 

 

Cash and cash equivalents at end of the year

1,296

2,767

 

 

Reconciliation of financing activities

For the year ended 31 March 2019

 

 

 

 

 

 

2019

Cash flow

2018

Cash flow

2017

 

£000

£000

£000

£000

£000

 

 

 

 

 

 

 

 

 

 

 

 

Bank loans

22,500

(1,850)

24,350

1,550

22,800

Finance leases

169

(106)

275

(86)

361

Long term debt

22,669

(1,956)

24,625

1,464

23,161

 

 

 

Notes

 

Segment Results

 

Management has determined the operating segments based on the reports reviewed by the Board of Directors that are used to make strategic decisions. 

 

The Board of Directors considers the business from an operational perspective as the Group has only one geographical segment, with all operations being carried out in the United Kingdom.

 

The Board of Directors assesses the performance of the operating segments using operating profit. The segment information provided to the Board of Directors for the reportable segments for the year ended 31 March 2019 is as follows:

 

 

 

 

 

Year ended 31 March 2019

Marine

Real Estate

Car Parking

Regeneration

Total

 

£000

£000

£000

£000

£000

Revenue

4,896

1,474

523

-

6,893

 

 

 

 

 

 

Segmental Operating Profit before Fair value adjustment and unallocated expenses

1,057

941

350

(141)

2,207

Fair value adjustment on investment properties and fixed assets

1,134

310

-

-

1,444

 

 

 

 

 

3,651

Unallocated:

 

 

 

 

 

Administrative expenses

 

 

 

 

(1,234)

Operating profit

 

 

 

 

2,417

 

 

 

 

 

 

Financial income

 

 

 

 

1

Financial expense

 

 

 

 

(902)

Profit before tax from continuing activities

 

 

 

 

1,516

Taxation

 

 

 

 

315

Profit for the year from continuing operations

 

 

 

 

1,831

 

Depreciation charge

 

 

 

 

 

Marine

 

 

 

 

314

Car Parking

 

 

 

 

33

Administration

 

 

 

 

11

 

 

 

 

 

358

 

 

 

 

 

Year ended 31 March 2018

Marine

Real Estate

Car Parking

Regeneration

Total

 

£000

£000

£000

£000

£000

Revenue

4,578

1,414

511

-

6,503

 

 

 

 

 

 

Gross profit prior to non-recurring items

971

946

318

(99)

2,136

Segmental Operating Profit before Fair value adjustment and unallocated expenses

971

946

318

(99)

2,136

Fair value adjustment on investment properties and fixed assets

(221)

(405)

-

-

(626)

 

 

 

 

 

1,510

Unallocated:

 

 

 

 

 

Administrative expenses

 

 

 

 

(1,374)

Exceptional costs of change in ownership

 

 

 

 

(1,741)

Operating loss

 

 

 

 

(1,605)

 

 

 

 

 

 

Financial income

 

 

 

 

-

Financial expense

 

 

 

 

(897)

Loss before tax from continuing activities

 

 

 

 

(2,502)

Taxation

 

 

 

 

304

Loss for the year from continuing operations

 

 

 

 

(2,198)

 

Depreciation charge

 

 

 

 

 

Marine

 

 

 

 

297

Car Parking

 

 

 

 

12

Administration

 

 

 

 

16

 

 

 

 

 

325

 

 

 

 

Assets and liabilities

 

 

 

2019

£000

2018

£000

Segment assets:

 

 

Marine

23,514

20,882

Real Estate

19,892

19,460

Car Parking

4,456

4,233

Regeneration

23,574

21,414

Total segment assets

71,436

65,989

Unallocated assets:

 

 

Property, plant & equipment

61

78

Trade & other receivables

405

415

Cash and cash equivalents

1,296

2,767

Total assets

73,198

69,249

 

 

2019

£000

2018

£000

Segment liabilities:

 

 

Marine

1,897

1,858

Real Estate

575

705

Car Parking

130

131

Regeneration

1,085

938

Total segment liabilities

3,687

3,632

Unallocated liabilities:

 

 

Bank overdraft & borrowings

22,669

24,625

Trade & other payables

87

320

Financial derivatives

-

6

Deferred tax liabilities

1,023

1,338

Tax payable

-

-

Total liabilities

27,466

29,921

 

 

 

 

Additions to property, plant and equipment

 

 

 

 

 

Marine

183

227

Car Parking

22

-

Unallocated

38

-

Total

243

227

 

Unallocated assets included in total assets and unallocated liabilities included in total liabilities are not split between segments as these items are centrally managed.

 

Unallocated expenses include central administrative costs that cannot be split between the various business segments because they are incurred in assisting the Group generate revenues across all business segments.

 

Revenue can be divided into the following categories:

 

2019 

2018 

 

£000

£000

 

 

 

Sale of goods

2,357

2,289

Rental income and service recharges

1,614

1,547

Provision of services

2,922

2,667

 

 

 

 

6,893

6,503

 

No revenues from any one customer represented more than 10% of the Group's revenue for the year.

 

 

Going Concern

 

The Group's forecasts and projections, taking account of reasonably foreseeable possible changes in trading performance, show that the Group should be able to operate within the level of the facilities and covenants over a period of at least twelve months.  The covenants measure interest cover, debt to fair value and capital expenditure.

 

After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group, therefore, continues to adopt the going concern basis in preparing its financial statements.

 

Directors' Statement

 

The preliminary results for the year ended 31 March 2019 and the results for the year ended 31 March 2018
are prepared in accordance with the recognition and measurement requirements of International Financial Reporting Standards as adopted by the European Union (IFRS). The accounting policies adopted in this preliminary announcement are consistent with the Annual Report for the year ended 31 March 2019.


 

The Board of Sutton Harbour Group plc approved the release of this audited preliminary announcement on 28 June 2019.

The preliminary financial information has been extracted from the Annual Report and audited Financial Statements for the year ended 31 March 2019, which will be posted to shareholders in due course and will be delivered to the Registrar of Companies following the Annual General Meeting of the Company.  These audited Financial Statements include the auditors' report which, whilst unqualified, contains reference by way of emphasis to the disclosures concerning the potential impact of government reports and Plymouth's planning strategy upon the valuation of the former airport site, which is held as inventory. The auditors' report does not contain a statement under either section 498(2) or section 498(3) of the Companies Act 2006. The report will also be available on the investor relations page of our website (
www.suttonharbourholdings.co.uk).  Further copies will be available on request and free of charge from the Company Secretary at Sutton Harbour Office, Guy's Quay, Sutton Harbour, Plymouth, PL4 0ES.

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
END
 
 
FR KMGMNVGNGLZM