REG - Fletcher King PLC - Final Results
30/08/2022 08:45
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RNS Number : 5661X Fletcher King PLC 30 August 2022
FLETCHER KING PLC
Audited results for the Year Ending 30 April 2022
Highlights
· Revenue for the year of £2,967,000 (2021: £2,264,000)
· Statutory profit before tax of £134,000 (2021: loss of
£834,000)
· Adjusted profit before tax of £144,000 (2021: loss of £935,000)
*
· Adjusted basic earnings per share of 1.73p (2020: loss of 8.57p)
*
· Final proposed dividend: 0.50p per share (2021: £nil)
· Significant cash reserves: £3.4m as at 30 April 2022 (2021:
£2.9m)
*Adjusted results are before share based payment expenses and after other
comprehensive income (see note 2).
The Annual Report and Accounts will shortly be posted on the Company's website
and a further announcement will be made when the document is sent to
shareholders.
Commenting on the results, David Fletcher, chairman of Fletcher King Plc said:
"The results for the year are a significant improvement from last year and we
are pleased to be able to commence dividend payments again. We have started
the new financial year with some encouraging instructions and are optimistic
that we can continue our growth pattern".
This announcement contains inside information for the purposes of the UK
Market Abuse Regulation and the Directors of the Company are responsible for
the release of this announcement.
For further information, please contact:
Fletcher King plc Tel: +44 (0) 20 7493 8400
David Fletcher, Non-Executive Chairman
Peter Bailey, Finance Director
Cairn Financial Advisers LLP Tel: +44 (0) 20 7213 0880
(Nominated Adviser)
James Caithie
Liam Murray
HAIRMAN'S STATEMENT
Results
Revenue for the year was £2,967,000 (2021: £2,264,000). Adjusted profit
before tax (see note 2) was £144,000 (2021: loss of £935,000). Statutory
profit before tax was £134,000 (2021: loss of £834,000).
The Board considers the adjusted results to be an important measure of
performance and to be more representative of performance for the year than the
statutory results (which have been prepared in accordance with International
Financial Reporting Standards).
Dividend
The Board is proposing a final dividend of 0.5p per share. The final dividend
is subject to shareholder approval at the AGM and will be paid on 28 October
2022 to shareholders on the register at the close of business on 30 September
2022. The ex-dividend date for this payment is 29 September 2022. With no
interim dividend paid (2021: £nil per share) the dividend for this year will
amount to 0.5p per share (2021: £nil per share).
The Commercial Property Market
It was encouraging that both the letting and capital markets were considerably
more buoyant than the previous year.
The impact of Covid on the market has now largely disappeared although numbers
back to the office have not yet returned to pre pandemic levels. However no
sooner has one world problem diminished than another takes its place in the
form of the tragic war in Ukraine and its impact on all economies throughout
the world.
Despite the continuing levels of uncertainty, the industrial property market
continued to perform exceptionally well with rents growing and capital values
powering ahead. Over the year, according to MSCI data, total returns in the
sector produced an astonishing 42% which compared to retail at 6% and offices
at 6.7%.
High Street retail continues to be difficult but interestingly the office
sector, in both London and major cities throughout the country, is showing
strong tenant demand for prime space with potential under supply in some
locations.
Business Overview
As seen from the figures above, the market was significantly better than the
previous year but it was not without its ups and downs and a significant level
of uncertainty remains in predicting future outcomes.
Property and Fund Management had a strong year. Despite the challenges of the
pandemic, we continued to produce excellent rent collection statistics. We
remodelled parts of the portfolios and acquired new clients during the year.
Our continued robust performance has fostered long client relationships some
of which have been in existence for over fifty years.
Bank Valuations showed a marked improvement compared to the previous year and
there has been a steady flow of instructions from lenders for whom we have not
previously acted.
Income from rating appeals was negligible, reflecting a disappointingly low
number of appeals settled with the Valuation Office. Hopefully the backlog of
appeals will be addressed by the Valuation Office and we can benefit from the
significant pipeline of appeals submitted on behalf of our clients.
As announced on 4 March 2022, and after a delay in receiving FCA approval, the
transaction completed whereby C M Strategic 613 Limited (an investment company
of Elliott Bernerd) acquired a 29.99% shareholding in the Company.
Our move to new offices in Soho went well and both staff and clients are happy
with our new location. We are using our new space more efficiently and there
has been a material reduction in our property overhead.
Outlook
The uncertainties mentioned above together with rising interest rates,
inflationary pressures and forecast recession are likely to have a continuing
impact on all markets in which the company operates and will affect our
ability to accurately forecast the future. However, we are optimistic about
our performance for the coming year and we have started it with some excellent
sales instructions as well as client funds available to invest in suitable
propositions. Our management portfolios are likely to grow both organically
and from appointments to advise new clients.
We anticipate the volume of valuations will increase during the year and
hopefully this will be the year when we return to activity in agreeing rating
appeals.
Importantly we hope our new significant shareholder will in due course become
the source of additional income streams and we await to see the progression of
this during the year.
Our balance sheet and cash reserves remain strong and have been of immense
importance during the difficult times we have experienced over the last two
years.
Once again, on behalf of all at Fletcher King I would like to thank our loyal
clients for their continued support. On behalf of the Board, I also
congratulate our outstanding staff for their foresight, expertise, dedication
and hard work which is ultimately why our clients appoint us.
DAVID FLETCHER
CHAIRMAN
30 August 2022
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 30 April 2022
Note 2022 2021
£000 £000
Revenue 2,967 2,264
Employee benefits expense (1,630) (1,262)
Depreciation expense (346) (281)
Gain recognised on remeasurement of lease liability 125 -
Other operating expenses (1,014) (1,566)
Share based payment expense (10) -
(2,875) (3,109)
Other operating income 39 25
Investment income 18 -
Finance income - 2
Finance expense (15) (16)
Profit/(loss) before taxation 134 (834)
Taxation 18 146
Profit/(loss) for the year 152 (688)
Other comprehensive income
Fair value (loss)/gain on financial assets through - (101)
Other comprehensive income
Total comprehensive income for the year attributable to equity shareholders
152 (789)
Earnings per share
Basic 4 1.62p (7.47p)
Diluted 4 1.50p (7.47p)
Adjusted earnings per share
Basic 4 1.73p (8.57p)
Diluted 4 1.60p (8.57p)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 30 April 2022
2022 2021
£000 £000
Assets
Non-current assets
Software 76 -
Property, plant and equipment 266 12
Right-of-use asset 494 272
Financial assets 529 529
Deferred tax assets 32 -
1,397 813
Current assets
Trade and other receivables 1,375 1,148
Corporation tax debtor 97 111
Cash and cash equivalents 3,365 2,892
4,791 4,151
Total assets 6,188 4,964
Liabilities
Current liabilities
Trade and other payables 1,124 908
Provisions 25 100
Lease liabilities 610 577
1,759 1,585
Non current liabilities
Lease liabilities 402 -
Total liabilities 2,161 1,585
Shareholders' equity
Share capital 1,025 921
Share premium 522 140
Investment revaluation reserve (101) (101)
Share option reserve 10 -
Retained Earnings 2,571 2,419
Total shareholders' equity 4,027 3,379
Total equity and liabilities 6,188 4,964
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 30 April 2022
2022 2021
£000 £000
Cash flows from operating activities
Profit/(loss) before taxation from continuing operations 134 (834)
Adjustments for:
Movement in provision (75) 100
Depreciation and amortisation expense 346 281
Remeasurement of lease liability (125) -
Investment income (18) -
Finance income - (2)
Finance expense 15 16
Share based payment expense 10 -
Cash flows from operating activities before
movement in working capital
287 (439)
Increase in trade and other receivables (181) (468)
Increase in trade and other payables 216 219
Cash generated from / (absorbed by) operations 322 (688)
Taxation paid - -
Net cash flows from operating activities 322 (688)
Cash flows from investing activities
Purchase of fixed assets (352) -
Investment income 18 -
Finance income - 2
Net cash flows from investing activities (334) 2
Cash flows from financing activities
Lease payments (1) -
Proceeds of share placing 547 -
Placing costs (61) -
Dividends paid to shareholders - (46)
Net cash flows from financing activities 485 (46)
Net increase/(decrease) in cash and cash equivalents 473 (732)
Cash and cash equivalents at start of year 2,892 3,624
Cash and cash equivalents at end of year 3,365 2,892
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 April 2022
Investment Share option reserve
Note Share Share Revaluation Retained TOTAL
capital premium Reserve Earnings EQUITY
£000 £000 £000 £000 £000 £000
Balance as at 1 May 2020 921 140 - - 3,153 4,214
Loss for the year - - - - (688) (688)
Fair value loss on financial assets - - (101) - - (101)
through other comprehensive income
Equity dividends paid 2 - - - - (46) (46)
Balance at 30 April 2021 921 140 (101) - 2,419 3,379
Total comprehensive income for the year - - - - 152 152
Share issue 104 443 - - - 547
Cost of share issue - (61) - - - (61)
Share based payment expense - - - 10 - 10
Balance at 30 April 2022 1,025 522 (101) 10 2,571 4,027
NOTES
1. General information
Whilst the financial information included in this preliminary announcement has
been prepared in accordance with UK-adopted international accounting
standards, this announcement does not itself contain sufficient information to
comply with IFRSs.
The financial information is presented in pounds sterling rounded to the
nearest thousand, and prepared in accordance with UK-adopted international
accounting standards and under the historical cost convention, except for the
revaluation of certain financial assets. The financial information set out in
this announcement does not comprise the Group's statutory accounts for the
years ended 30 April 2022 or 30 April 2021.
The financial information for the year ended 30 April 2021 is derived from the
statutory accounts for that year which have been delivered to the Registrar of
Companies. The auditors reported on those accounts; their report was
unqualified and did not contain a statement under either Section 498 (2) or
Section 498 (3) of the Companies Act 2006 and did not include references to
any matters to which the auditor drew attention by way of emphasis.
The financial information for the year ended 30 April 2022 is derived from the
audited statutory accounts for the year ended 30 April 2022 on which the
auditors have given an unqualified report, that did not contain a statement
under section 498(2) or 498(3) of the Companies Act 2006 and did not include
references to any matters to which the auditors drew attention by way of
emphasis. The statutory accounts will be delivered to the Registrar of
Companies following the Company's annual general meeting.
2. Alternative performance measures - profit/(loss) reconciliation
The reconciliation set out below provides additional information to enable the
reader to reconcile to the numbers discussed in the Chairman's Statement and
Highlights section.
Year ended 30 April 2022 2021
£000 £000
Profit/(loss) before taxation 134 (834)
Add back: Share based payment expense 10 -
Include: Fair value (loss)/gain on financial assets through OCI - (101)
Adjusted (loss)/profit before share-based payment expense and taxation 144 (935)
Taxation 18 146
Adjusted profit/(loss) after tax for the year 162 (789)
The fair value loss on financial assets in the prior year represents the
unrealised loss in the year on the revaluation of the Group's interest in the
SHIPS 16 syndicate.
3. Dividends
Year ended 30 April 2022 2021
£000 £000
Equity dividends on ordinary shares:
Declared and paid during year
Ordinary final dividend for the year ended 30 April 2021: nil per share - 46
(2020: 0.50p)
Interim dividend for the year ended 30 April 2022: nil per share (2021: nil) - -
- 46
Proposed ordinary final dividend for the year ended
30 April 2022: 0.50p per share 51
4. Earnings per share
Number of shares 2022 2021
No No
Weighted average number of shares for basic earnings per share 9,375,425 9,209,779
Share options 920,000 -
Weighted average number of shares for diluted earnings per share 10,129,779 9,209,779
Earnings £000 £000
Profit/(loss) after tax for the year 152 (688)
(used to calculate the basic and diluted earnings per share)
Add back: Share based payment expense 10 -
Include: Fair value (loss)/gain on financial assets through OCI - (101)
Adjusted profit/(loss) after tax for the year 162 (789)
(used to calculate the adjusted basic and diluted earnings per share)
Earnings per share
Basic 1.62p (7.47p)
Diluted 1.50p (7.47p)
Adjusted earnings per share
Basic 1.73p (8.57p)
Diluted 1.60p (8.57p)
Forward Looking Statements
Certain statements in this announcement are forward-looking statements
relating to the Company's operations, performance and financial position based
on current expectations of, and assumptions and forecasts made by, management.
They are subject to a number of risks, uncertainties and other factors which
could cause actual results, performance or achievements of the Company to
differ materially from any outcomes or results expressed or implied by such
forward-looking statements. Undue reliance should not be placed on such
forward looking statements. They are made only as of the date of this
announcement and no representation, assurance, guarantee or warranty is given
in relation to them including as to their accuracy, completeness, or the basis
on which they are made.
END
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