REG-Secured Property Developments Plc: Annual Financial Report <Origin Href="QuoteRef">SPD.ISD</Origin> <Origin Href="QuoteRef">SPD.L</Origin> - Part 1
22/06/2015 17:00
Secured Property Developments plc
Annual report and financial statements
Registered number 2055395
For the year ended 31 December 2014
Contents
Notice of meeting 1
Company information 2
Chairman's statement 3
Strategic report 5
Directors' report 7
Statement of directors' responsibilities in respect of the Strategic report,
the Directors' report and the financial statements 9
Independent auditor's report to the members of Secured Property
Developments plc 10
Consolidated profit and loss account 12
Consolidated balance sheet 13
Company balance sheet 14
Consolidated cash flow statement 15
Consolidated Statement of Total Recognised Gains and Losses 16
Reconciliation of movements in shareholders' funds 17
Notes to the financial statements 18
Form of proxy for use at the annual general meeting on 15 July 2015 28
Notice of meeting
NOTICE IS HEREBY GIVEN that the Twenty fourth Annual General Meeting of Secured
Property Developments plc will be held at The Small Mall Room, The Royal
Automobile Club, 89 Pall Mall, London, SW1Y 5HS on 15 July 2015 at 11am for the
following purposes:
* To receive and adopt the financial statement for the year ended 31 December
2014 together with the reports of the Directors and the Auditor thereon.
* To re-elect R Shane as a director (retired by rotation)
* To re-elect J Soper as a director (retired by rotation)
* To authorise, by special resolution in accordance with s701 of the
Companies Act 2006, the Board to purchase up to 5% of the Company's own
shares in the open market at a minimum price of 20p per share and a maximum
price of 60p per share, such powers to expire at the AGM to be held in
2016, or on 15 July 2016 if earlier.
* To appoint as Auditors KPMG LLP, and to authorise the Directors to agree
their remuneration, such powers to expire at the AGM held in 2016.
* To consider and, if deemed fit, pass the following resolution as a special
resolution:
+ THAT the regulations set forth in the printed document produced to this
meeting and for the purposes of identification signed by the chairman
hereof, be approved and adopted as the articles of association of the
Company, in substitution for, and to the exclusion of, all existing
articles thereof
The purpose of this resolution is to enable the members to
transfer their shares in uncertificated form (via CREST) and to send notices by
electronic means.
* To transact any other ordinary business of the Company.
By order of the board
I H Cobden Date: 15 June 2015
Secretary
Notes:
1. Enclosed with these accounts is a letter concerning the supply of documents
and information by e-mail. Please read this letter and, if you would like
to receive documents and information in this way, please complete and
return the enclosed form.
2. A member entitled to attend and vote at this meeting is entitled to appoint
a proxy to attend and vote in his stead. A proxy need not be a member of
the Company. Proxy forms must be lodged at the Registered Office not later
than forty-eight hours before the time fixed for the meeting.
3. We would draw the attention of members proposing to attend the meeting to
the RAC Club dress code, which requires men to wear a tailored jacket and
trousers, collared shirt and tie at all times and women to dress with
commensurate formality.
Company information
Directors R France
G Green
R Shane
P Stansfield
D Duffield
J Soper
Secretary I Cobden
Registered office Unit 6
42 Orchard Road
London
N6 5TR
Auditor KPMG LLP
8 Princes Parade
Liverpool
L3 1QH
Bankers The Royal Bank of Scotland Plc
Piccadilly Circus Branch
48 Haymarket
London
SW17 4SE
Solicitors Summers
22 Welbeck Street
London
W1G 8EF
Share Dealing The Company's Ordinary shares are
quoted on the ICAP Security and
Derivative Exchange (ISDX) and persons
can buy or sell shares through their
stockbroker.
Registrars Avenir Registrars Ltd
Suite A, 6 Honduras Street,
London
EC1Y 0TH
ylva.baeckstrom@avenir-registrars.co.uk
www.avenir-registrars.co.uk
Telephone 020 7692 5500
Share Price The middle market price of the Ordinary
shares were quoted at 31 December 2014
on the ISDX (previously the PLUS
Market) at 20.5p pence per share (2013:
12.5 pence per share)
Chairman's statement
In February of this year the Board approved a change of Company strategy to
focus on acquisitions and development of UK residential property. Since the
parliamentary election there has been renewed interest in residential property,
particularly from international investors. Indeed Savills are now predicting
price increases across the UK of around 19.3% over the next five years.
As part of this change of strategy the Board also approved the disposal of
three of the Company's retail properties and repayment of the RBS loan.
On 26 March 2015, commercial units at 14 St Sampson's Square York, and 11 & 13
Newborough Scarborough were sold at auction for an amount of £1,325,000. Upon
completion on 12 May 2015 the RBS loan facility of £1,500,000 was repaid in
full using a combination of net sale proceeds and existing cash holdings. This
leaves the Company free of bank debt and in a strong position to pursue
residential property acquisitions and development opportunities.
RBS Swap Claim
In May 2014 following the resolution of the Group's original interest rate swap
dispute with Royal Bank of Scotland, a provisional basic address payment of £
476,309 was received from RBS. This payment was subject to additional claims
for consequential loss and additional tax which were submitted to RBS in July
2014.
In March 2015 RBS made an offer in settlement of the additional claims in the
sum of £43,930. For various reasons this offer has been challenged by the
Company and a response from RBS is now awaited. As such no amount has been
recognised in these accounts in respect of the consequential loss claim.
2014 Accounts
Turnover in 2014 has increased to £148,437 compared with £131,003 in 2013.
The profit before taxation was £404,044 compared with a loss of £78,011 in
2013, due mainly to the compensation payment from RBS received in the year and
disclosed as an exceptional item in the Profit and Loss account.
Electronic Communication
Accompanying the notice of AGM is a letter to all members relating to the
supply of documents and information in electronic form. In common with other
listed companies your Board recommends approval to electronic communication and
the consequential revisions to the Company's Articles of Association.
Cash resources and dividends
We continue to maintain a tight control of the Company's cash resources, which
we consider adequate to support current levels of expenditure, although we keep
them under constant review.
In current circumstances the Board considers it is not appropriate to recommend
the payment of a dividend for the year ending 31 December 2014.
I should like to welcome John Soper as a member of the Board with effect from
19 December 2014. John is a chartered accountant and has considerable
experience in the property industry.
Chairman's statement (continued)
AGM
The annual general meeting will take place at the Royal Automobile Club, 89
Pall Mall London, SW1Y 5HS on 15 July 2015 at 11am and the directors look
forward to meeting those shareholders, who can attend.
D Duffield
Chairman
Strategic report
Principal Activities
The principal activity of Secured Property Developments plc is investment in
commercial property. The group comprises the holding company, a finance
company and a second property company.
Business Model
At Secured Property Developments, we focus on maximising the return from our
portfolio of properties whilst looking for new acquisitions where we can by
development increase value and thereby create value for shareholders.
We create value by:-
Acquiring Properties
* We seek to acquire properties and unlock value.
Optimise Income
* Optimising income by development and carrying out improvements and good
estate management.
* Employ our knowledge of occupiers' needs to let to high quality tenants
from a wide range of businesses and to minimise the level of voids in our
portfolio.
* Collecting our rental income on due date.
Recycle Capital
* Identify properties for disposal where value has been optimised and dispose
of those which do not fit the Group's long-term plans.
Maintain robust and flexible financing
* Negotiate flexible financing and retain a healthy level of interest cover
and gearing
Business Review
The results for the year are set out on page 12 of these consolidated financial
statements.
The group's investment properties are let at rents commensurate with local
market conditions and on terms that include periodic upwards adjustment,
financed by bank borrowings. A review of the business is included in the
Chairman's Statement set out on page 3 and 4.
Principal Risks and Uncertainties
Going Concern
The directors have prepared the financial statements on a going concern basis
for the reasons set out in note 1 to the financial statements.
Derivatives and other financial instruments
The group's financial instruments comprise borrowings, some cash and liquid
resources, convertible unsecured loan stock and various items, such as trade
debtors and trade creditors, that arise directly from its operations. The main
purpose of these financial instruments is to raise finance for the group's
operations.
The main risks arising from the group's financial instruments are interest rate
risk and liquidity risk. The Board reviews and agrees policies for managing
each of these risks and they are summarised below.
Strategic report (continued)
Interest rate risk
The group has financed its operations through bank borrowings. The group's
policy is to borrow at the lowest rates for periods that do not carry excessive
time premiums.
Liquidity risk
As regards liquidity, the group's policy has throughout the year been to ensure
that the group is able at all times to meet its financial commitments as and
when they fall due. The maturity date of the loan to the group is set out in
note 16 of these financial statements. The current status of the negotiations
in respect of the Group's financing facilities is set out in the Chairman'
Statement and note 1 to the financial statements.
Future Developments
Following the settlement of the "swap" situation as detailed in the Chairman's
report, the Directors will now be able to actively consider opportunities that
may arise including alternative sources of financing.
Signed on behalf of the Board
R
Shane
Dated: 15 June 2015
Director
Directors' report
Proposed dividend and transfer to reserves
The directors do not recommend the payment of a dividend (2013: £nil).
The profit for the year retained in the group is £359,525 (2013: £78,011 loss).
Directors and directors' interests
The directors who held office during the year were as follows:
D Duffield
R France
G Green
R Shane
P Stansfield
J Soper
The directors who held office at the end of the financial year had the
following interests in the shares and loan stock of the group companies as
recorded in the register of directors' share and debenture interests.
Interest Interest at
Director Company Class at 1 January
31 2014
December Number
2014
Number
D Duffield SPD plc* Ordinary shares - -
R France SPD plc* Ordinary shares 88,888 88,888
G Green SPD plc* Ordinary shares 90,000 90,000
Deferred shares 30,000 30,000
R Shane SPD plc* Ordinary shares 574,456 574,456
Deferred shares 154,666 154,666
P Stansfield SPD plc* Ordinary shares 6,250 6,250
J Soper SPD plc* Ordinary shares
- -
* SPD plc is used above as an abbreviation for Secured Property Developments
plc.
According to the register of directors' interests, no rights to subscribe for
shares in or debentures of the Company or any other group company was granted
to any of the directors or their immediate families, or exercised by them,
during the financial year.
Substantial shareholding of ordinary shares of 20p each as at 31 December 2014
R France 4.51%
G Green 4.57%
R Shane 29.15%
Disclosure of information to the auditor
The directors who held office at the date of approval of this Directors' report
confirm that, so far as they are each aware, there is no relevant audit
information of which the Company's auditor is unaware; and each director has
taken all the steps that he ought to have taken as a director to make himself
aware of any relevant audit information and to establish that the Company's
auditor is aware of that information.
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