| Mon 21 Nov 2011, 10:45 | | TDH - Tradehold Limited - Unaudited interim results for the 6 months |
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TDH
TDH
TDH - Tradehold Limited - Unaudited interim results for the 6 months
ended 31 August 2011
Tradehold Limited
("Tradehold" or "the company")
(Registration number 1970/009054/06)
JSE share code: TDH ISIN: ZAE000152658
Unaudited interim results for the 6 months ended 31 August 2011
Tradehold is an investment holding company with interests mainly in the
Moorgarth group of property companies in which it holds the controlling
interest, and in the UK retailing group Instore Limited, in which it has
a 15,9% share-holding. Moorgarth owns and manages a portfolio of
commercial properties throughout the UK.
Business review
The commercial property sector in the UK continues to reflect the turmoil
that has characterised the country`s economy since 2008. The property
market showed positive signs of recovery at the end of 2010 and the
beginning of 2011. However, in recent months the all-pervading sense of
uncertainty in the economy saw the tentative recovery falter. Occupier
demand especially in the area of retail space declined and rental income
came under increasing pressure as the amount of vacant space grew across
the spectrum. Capital growth in the commercial property sector slowed to
just 0,3% in the third quarter.
Moorgarth
The stuttering British economy severely depressed business confidence and
thereby also the demand for office and retail space while investment in
new developments dwindled. Under these conditions management during the
period under review focused primarily on marketing and managing the
group`s portfolio of 23 buildings as effectively as possible to minimise
the amount of vacant space. Rental income increased well above budget and
the group ended the period under review with a net profit of GBP0,4
million due to an increase of GBP0,6 million in the valuation of the
portfolio to GBP71,2 million.
Moorgarth continues to search for new investment opportunities that offer
value enhancement potential over a relatively short period. In June the
group acquired a retail park at a cost of GBP12 million in Perth in
Scotland and several other potential acquisitions are being pursued.
During the review period Moorgarth repaid GBP12,9 million in bank loans
with further repayments planned for the remainder of the year. Bank
funding will again be considered at an opportune time.
Moorgarth does not expect the environment in which the group operates to
change materially in the second half of the year and will thus continue
its present strategies in managing the portfolio. Opportunities for
further acquisitions might arise as clearing banks start offering
repossessed portfolios in the market. As in the past, each potential
opportunity will be evaluated against management`s acquisition criteria.
Comments on the results
Included in the trading profit are:
- An unrealised currency loss of GBP0,9 million on a Swiss Franc
denominated loan, and
- Valuation gains on Moorgarth investment properties of GBP0,6 million.
Exceptional items
Exceptional items are made up as follows:
Unaudited Unaudited Audited
6 months 6 months 12 months
(GBP`million) to 31/08/11 to 31/08/10 to 28/02/11
Fair value adjustment:
UBS AG investment (2,1) 1,2 2,0
Lease repair liabilities - - (2,9)
Legal and professional expenditure (0,4) (0,3) (1,6)
Recovery of lease guarantee payments - - 0,6
Impairment of loans - - (0,2)
Total (2.5) 0.9 (2,1)
During the reporting period the company successfully completed a rights
issue in South Africa of 103 833 866 new shares at R6,26 per share
raising R650 million. This bolstered the group balance sheet by GBP59
million during the period.
Dividend
In order to preserve cash and given the uncertainties in the market the
board does not recommend paying a dividend to shareholders.
Outlook
With the property market in the sway of political developments in Europe
it would be imprudent to venture any predictions as to where it will be
moving in the second half of the year. Management policies will therefore
continue to be mainly defensive with the accent on maximising the
existing portfolio`s income potential.
Accounting policy
The interim report has been prepared in accordance with the recognition
and measurement principles of International Financial Reporting Standards
(IFRS) and the AC 500 Standards as issued by the Accounting Practices
Board, including IAS 34: Interim Financial Reporting, and in accordance
with the requirements of the South African Companies Act, Act 71 of 2008,
as amended, 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 2011, except as set
out below.
During the period Tradehold adopted the following revised accounting
standards:
- IFRS 7: Financial Instruments - Disclosures (amendments resulting from
May 2010 Annual Improvements to IFRS);
- IAS 1: Presentation of Financial Statements (amendments resulting from
May 2010 Annual Improvements to IFRS);
- IAS 24: Related Party Disclosures (revised definition of related
parties);
- IAS 34: Interim Financial Reporting (amendments resulting from May 2010
Annual Improvements to IFRS).
The adoption of these standards has had no significant effect on these
results.
These results have not been audited nor have they been reviewed by the
group`s auditors, PricewaterhouseCoopers Inc.
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
Malta
16 November 2011
Sponsor: One Capital
Statement of comprehensive income
Unaudited Unaudited Audited
6 months 6 months 12 months
(GBP`000) to 31/08/11 to 31/08/10 to 28/02/11
Revenue 3 116 3 111 5 929
Trading profit 281 653 6 110
Exceptional items (2 589) 936 (2 112)
Operating (loss)/profit (2 308) 1 589 3 998
Interest received 120 58 216
Interest paid (1 099) (1 124) (2 281)
(Loss)/profit before taxation (3 287) 523 1 933
Taxation 34 1 (15)
(Loss)/profit for the period (3 321) 522 1 948
Other comprehensive income
Currency translation differences - - (11)
Total comprehensive
(loss)/income for the period (3 321) 522 1 937
(Loss)/profit attributable to:
Owners of the parent (3 392) 560 1 220
Non-controlling interest 71 (38) 728
(3 321) 522 1 948
Total comprehensive (loss)/income attributable to:
Owners of the parent (3 392) 560 1 209
Non-controlling interest 71 (38) 728
(3 321) 522 1 937
(Loss)/earnings per share (pence): basic and diluted
- before exceptional items (0,8) (1,1) 9,6
- basic (loss)/earnings (3,4) 1,6 3,5
- headline (loss)/earnings (4,0) 1,6 (9,7)
Number of shares for calculation
of earnings per share (`000) 99 550 34 654 34 654
Statement of financial position
Unaudited Unaudited Audited
(GBP`000) 31/08/11 31/08/10 28/02/11
Non-current assets 71 844 52 063 57 530
Investment properties 65 800 45 167 51 385
Property, plant and equipment 6 029 6 720 6 126
Financial assets 15 176 19
Current assets 49 698 22 099 20 874
Financial assets 7 484 8 923 9 762
Trade and other receivables 1 932 1 765 2 054
Non-current assets held for sale - 332 -
Inventories 35 28 29
Cash and cash equivalents 40 247 11 051 9 029
Total assets 121 542 74 162 78 404
Equity 86 884 29 958 31 349
Ordinary shareholders` equity 85 768 29 655 30 304
Non-controlling interest 1 116 303 1 045
Non-current liabilities 12 28 445 7 855
Preference share capital 12 12 12
Long-term borrowings - 28 433 7 843
Current liabilities 34 646 15 759 39 200
Short-term borrowings 28 659 13 420 33 707
Other current liabilities 5 987 2 339 5 493
Total equity and liabilities 121 542 74 162 78 404
Statement of changes in equity
Unaudited Unaudited Audited
6 months 6 months 12 months
(GBP`000) to 31/08/11 to 31/08/10 to 28/02/11
Balance at beginning
of the period 31 349 29 436 29 436
Proceeds from rights issue 58 856 - -
Transactions with non-controlling
shareholders - - (24)
Total comprehensive (loss)/income
for the period (3 321) 522 1 937
Balance at end of the period 86 884 29 958 31 349
Statement of cash flows
Unaudited Unaudited Audited
6 months 6 months 12 months
(GBP`000) to 31/08/11 to 31/08/10 to 28/02/11
Cash flows from operating
activities (865) (158) (1 582)
Cash flows from investing
activities (13 882) (22) (293)
Acquisition of investment
properties (15 072) - (82)
Acquisition of property,
plant and equipment (113) - (57)
Proceeds on disposal of
investment properties 1 300 - -
Proceeds on disposal of property,
plant and equipment - - 6
Other investment activities 3 (22) (160)
Net cash flow (14 747) (180) (1 875)
Cash flows from financing
activities 45 965 642 315
Proceeds from rights issue 58 856 - -
Proceeds from borrowings - 3 279 3 467
Repayment of borrowings (12 891) (2 637) (3 128)
Transactions with non-controlling
shareholders - - (24)
Net increase/(decrease) in
cash and cash equivalents 31 218 462 (1 560)
Cash and cash equivalents at
beginning of the period 9 029 10 589 10 589
Cash and cash equivalents at
end of the period 40 247 11 051 9 029
Supplementary information
Unaudited Unaudited Audited
6 months 6 months 12 months
(GBP`000) to 31/08/11 to 31/08/10 to 28/02/11
1. Depreciation for the period 210 180 403
2. Capital expenditure for
the period1 5 185 - 139
3. Calculation of headline earnings
Net (loss)/profit (3 392) 560 1 220
Surplus on revaluation of
investment properties (642) - (5 804)
Profit on disposal of investment
properties - - (6)
Impairment of property, plant
and equipment - - 428
Taxation - - -
Non-controlling interest 96 - 806
(3 938) 560 (3 356)
Unaudited Unaudited Audited
31/08/11 31/08/10 28/02/11
4. Number of shares in issue
(net of treasury shares) (`000) 138 488 34 654 34 654
5. Net asset value per share (pence) 61,9 85,6 87,4
6. Financial assets
Listed investments at fair value 5 672 7 111 7 832
Unlisted investments at fair value 1 812 1 812 1 812
Loans 133 176 137
7 617 9 099 9 781
7. Contingent liabilities 5 349 7 942 5 428
Segmental analysis
Trading Total
(GBP`000) Revenue profit/(loss) assets
Six months to 31 August 2011 (unaudited)
Property - retail 1 325 1 893 56 167
- commercial 171 (38) 7 133
- offices 283 191 5 178
- leisure 1 337 99 7 112
- other - (133) 154
Treasury - (1 731) 45 798
3 116 281 121 542
Six months to 31 August 2010 (unaudited)
Property - retail 1 216 898 29 956
- commercial 129 (63) 8 168
- offices 305 253 6 135
- leisure 1 461 322 7 851
- other - (133) 1 674
Treasury - (624) 20 378
3 111 653 74 162
Twelve months to 28 February 2011 (audited)
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
Date: 21/11/2011 10:45:01 Produced by the JSE SENS Department.
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