REG - Town Centre Secs. - Half-year Results
27/03/2025 07:15
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RNS Number : 3809C Town Centre Securities PLC 27 March 2025
27 March 2025
TOWN CENTRE SECURITIES PLC
('TCS' or the 'Company')
Half year results for the six months ended 31 December 2024
Resilient and stable performance given macro-economic conditions
Town Centre Securities PLC, the Leeds, Manchester, Scotland, and London
property investment, development, hotel and car parking company, today
announces its results for the six months ended 31 December 2024.
Commenting on the half year results, Chairman and Chief Executive Edward Ziff,
said:
"The last six months have been a period of stability for TCS with all three
operating divisions continuing to deliver resilient underlying revenues and
earnings."
"Inflation has fallen, albeit still above the Government's target of 2
percent, and interest rates have been reduced slightly, however uncertainty
around the geopolitical situation and its effect on the wider economy still
presents a challenge. With a diversified and well balanced portfolio and
continued low levels of variable interest rate debt, I remain confident that
we are in a strong position in these uncertain times."
"We have a resilient business with committed employees and an engaged
executive team, however I continue to be disappointed by the wide share price
discount to the net tangible asset value that TCS shares trade on. This is
obviously disappointing for all our stakeholders, but we will continue to
focus on the deliverability of our long-term growth plan while ensuring
financial prudence."
"Our attention remains focused on investing in our existing portfolio, in
particular our single largest asset, the Merrion Centre, and our development
programme. However, we are also looking at other investments, both in
traditional real estate opportunities and complementary situations that can
add value and further diversify our risk. We remain ever mindful that taking
advantage of potentially accretive opportunities needs to be balanced against
retaining robust finances."
Financial performance - resilient and stable
· Net assets per share - remained stable:
o Like for like portfolio valuation down 0.8% from June 2024:
§ compared to the MSCI/IPD UK All Property Capital Index which
increased by 0.8% over the period
§ reduction primarily due to market sentiment around the macro-economic
outlook adversely impacting valuation yields - in particular in the office
sector, which is having a knock on impact on the residual value of our
development sites.
o Statutory net assets remain unchanged at £119.6m or 284p per share (FY24:
£119.6m, 284p). EPRA net tangible assets ('NTA')(*) measure at £116.7m or
277p per share (FY24 equivalent: £116.7m, 277p)
· Statutory results - reflecting resilient underlying performance:
o Statutory profit before tax of £2.8m (HY24: loss of £9.7m)
o Statutory earnings per share of 1.0p (HY24: loss of 15.3p)
· EPRA results:
o EPRA earnings(*) of £1.8m (HY24: £3.8m, which included the benefit of
£1.7m of taxation credit - with the recognition of a deferred tax asset
arising from brought forward trading losses resulting from the Company exiting
the REIT regime)
o EPRA earnings per share(*) of 4.2p (HY24: 7.9p)
· Loan to Value** decreased slightly in the period from 50.8% to 50.1%
· Shareholder returns:
o Proposed fully covered interim dividend of 2.5p, (HY24: 2.5p) reflecting
the relative stability in underlying earnings
* Alternative performance measures are detailed, defined and reconciled within
Note 4 and the financial review section of this announcement
** LTV Calculation includes finance lease assets and liabilities
Protecting shareholder value whilst safeguarding the business for the future
Progress delivered under our four key strategic initiatives is as follows:
Actively managing our
assets
Our long-standing strategy of active management and redevelopment, to drive
income and capital growth, has continued:
· We now have a well diversified portfolio comprising: 30% invested in
retail and leisure; 29% offices; 15% car parks; 13% residential; 9%
developments; and 4% hotels
· The void rate across our portfolio reduced to 7.3% at 31 December
2024 (8.1% at 30 June 2024)
· Strong rent collection for the period of 99.3% (FY24: 99.1%)
· 16 new commercial lettings and lease renewals at ERV across the
portfolio in the period totalling £0.6m of rental income per annum
· Rolling out our own car park management system across our car park
portfolio has now been completed which will ultimately give us both
operational and financial efficiencies whilst improving the customer
experience
Maximising available capital
A conservative capital structure, with a mix of short and long-term secure
financing, has always underpinned our approach:
· The final element of deferred consideration arising from the sale of
our investment in YourParkingSpace Limited was received in July 2024 (£3.1m)
· Comfortable loan to value headroom over our bank facilities of
£26.3m based on 31 December 2024 borrowings and valuations
· Loan to value* decreased to 50.1% in the period (FY24: 50.8%)
Investing in our development pipeline
Our development pipeline, with an estimated GDV of over £400m, is a valuable
and strategic point of difference for TCS which we continue to progress and
enhance.
· Merrion Centre (Wade House and 100MC), Leeds: In December 2023 a
planning application was submitted for student accommodation as part of the
Merrion Centre's evolution. This application, which has not yet been presented
to the Leeds Plans Panel, incorporates a 1,110 new bed purpose built student
accommodation scheme based on the redevelopment of Wade House and the adjacent
100MC site. We are continuing to work through the design of these buildings,
addressing both changes in regulation and feedback from statutory consultees.
· Whitehall Riverside, Leeds: Following the securing of a planning
consent at Whitehall Riverside in May 2023 we continue to move forward with
both build contractors/professional teams and potential tenants for all phases
of the development. Although rental values and demand are increasing, in
particular for new build prime 'right-sized' office space, this is not
reflected in current investment yields and is delaying development.
Acquiring and improving investment assets to diversify our portfolio
We continue to improve investment assets, with a stable portfolio of diverse
properties:
· During the period we:
o Invested in the refurbishment of a 20 unit residential asset in Glasgow
and the first phase of Town Centre House in Leeds. Both refurbishments have
resulted in increased rental values and demand for the new space.
o Completed the roll out of our own 'barrierless' parking management system
across our portfolio of CitiPark branches.
Outlook
· Resilient trading performance has continued into the second half of
FY25:
o Rent collections remain robust with over 99% of amounts invoiced in the
last quarter of the year now collected
o One further restaurant letting completed in February 2025
o Car parks recovery momentum continues, other than for those reliant on
office workers such as Merrion MSCP
o Significant headroom of £26.3m on existing revolving credit facilities
o Only 12.5% of borrowings at the period end subject to variable interest
rates, with £82.4m of debenture fixed until 2031 and £14.2m of property
specific debt fixed until 2029
o Weighted average cost of borrowings at period end of 5.2%
-Ends-
For further information, please contact:
Town Centre Securities PLC
www.tcs-plc.co.uk
(https://protect.checkpoint.com/v2/___http:/www.tcs-plc.co.uk/___.bXQtcHJvZC1jcC1ldXcyLTE6bmV4dDE1OmM6bzo1OGJkNzlmNDRiZjQ2MTdlNjk0MWQ2YjIwM2ViYTZkYzo2OjZlNTI6YWVjZGM1ZTk2M2Y2NmNjNTZlMzcwNGYzOGJhODExNTJlOTkwZTUzMTA3ODA4MTMwYmJhZDBlNzljYWIxNjQwOTpwOlQ6Tg)
/ @TCS PLC
Edward Ziff, Chairman and Chief
Executive
0113 222 1234
Stewart MacNeill, Group Finance Director
MHP
+44 7827 662 831
Reg Hoare / Matthew Taylor
tcs@mhpgroup.com
Chairman and Chief Executive's Statement
Resetting and reinvigorating the business for the future
We have seen a stable performance across all three operational segments of the
business in the past six months. Our property and car park portfolio has very
slightly reduced in value by 0.8% like for like over the six months. We
believe the reduction reflects the general market as opposed to any concerns
around our portfolio.
Our strategy over the last three years has been to create a business that:
- Has lower levels of absolute debt and leverage
- Is diversified with a much-reduced level of retail property
following £120m of property sales during this period
- Works closely with and supports all our tenants , doing our best to
ensure that following the disruption of the last few years as many of our
tenants as possible are able to bounce back strongly
- Is diversified with a capital light, profitable car park business
- Has rebased and has significant growth opportunities as a result of our
valuable development pipeline and asset management opportunities
- Has supported our employees and their families who have been
impacted by the ongoing cost of living crisis
Results
The statutory profit for the six months ended 31 December 2024 was £0.4m
(HY24: loss of £7.3m) giving earnings per share of 1.0p (HY24: loss per share
of 15.3p). The like for like portfolio decreased in value by 0.8% over the six
months under review as a result of market sentiment around the UK's economic
outlook.
EPRA earnings for the six months ended 31 December 2024 were £1.8m (HY24:
£3.8m) giving EPRA earnings per share of 4.2p (HY24: 7.9p). The EPRA earnings
in HY24 were significantly impacted by the recognition on 1 July 2023 and
subsequent part release of a net deferred tax asset resulting from the Company
exiting the REIT regime - the effect in the prior period was to increase EPRA
earnings by £1.7m or 3.5p.
Taxation recognised in the six months ended 31 December 2024 in both the
income statement and the statement of comprehensive income is not expected to
have a cash impact on the Company and has reduced the over net deferred tax
balance in the period.
Statutory Net Assets of £119.6m (30 June 2024: £119.6m) remained static from
the year end. Net assets per share remained the same in the six months to 284p
(30 June 2024: 284p).
EPRA Net Tangible Assets (EPRA NTA); which in the case of TCS reduces
statutory net assets by the £2.9m of reported Goodwill (FY24 comparable
£2.9m), for the half year is £116.7m compared to £116.7m at FY24. EPRA NTA
per share is 277p (FY24 comparable 277p). The full breakdown of the EPRA net
asset measures are detailed later.
Borrowings
Net borrowings, which includes lease liabilities, have reduced by 3.4% over
the six months from £137.2m to £132.6m, largely reflecting receipt of the
final tranche of consideration due following the sale of the investment in
YourParkingSpace.
The reduction in borrowings and the valuation reductions we have seen in our
property portfolio have resulted in our loan to value level decreasing by 70
bps from the June year end to 50.1%.
Dividends
A maintained fully covered interim dividend of 2.5p per share (HY24 2.5p) will
be paid on the 13 June 2025 to shareholders registered on 23 May 2025;
amounting to £1.1m in total. There was no final dividend for 2024. The
ex-dividend date for the interim dividend will be 22 May 2025.
The maintenance of the interim dividend at 2.5p reflects the resilience of the
underlying earnings of our core business and also the strengthening of the
balance sheet following the asset sales completed over the last three years -
this dividend represents 59% of EPRA earnings.
Portfolio Performance
The value of investment properties, developments, joint ventures and car parks
at the half-year stood at £257.2m (June 2024: £256.0m).
The following table provides an overview of the performance of the portfolio,
including our share of joint venture assets, in the six months ended 31
December 2024, highlighting the balance of the Company's portfolio in light of
our strategy of reducing exposure to retail and leisure and also the
underlying current and potential future value of our development pipeline.
Passing rent ERV Value % of portfolio Valuation incr/(decr) Initial yield Reversionary yield
£m £m £m
Retail & Leisure 0.6 1.5 15.8 6% 14.5% 3.8% 8.8%
Merrion Centre (ex offices) 4.0 4.9 48.6 19% -4.4% 7.7% 9.5%
Offices 4.6 6.4 73.7 29% 0.5% 5.9% 8.3%
Hotels 0.9 0.9 10.3 4% 4.0% 8.5% 8.5%
Out of town retail 1.0 1.3 13.0 5% 4.0% 7.6% 9.8%
Residential 1.5 1.8 34.5 13% 6.2% 4.1% 5.0%
12.7 16.9 196.0 76% 1.6% 6.1% 8.2%
Development property 22.1 9% -15.5%
Car parks 39.1 15% -3.5%
Portfolio 257.2 100% -0.8%
The following table reconciles the above analysis to that set out in Note 7.
£m
Portfolio - as per note 7 247.1
50% Share in Merrion House 27.5
Goodwill - Car Parks (Property Specific Only) 2.5
Less - Right-to-Use Car Parks (19.9)
As per the table above 257.2
Note - the IFRS 16 Right-of-Use car parks (£19.9m) are excluded in the
portfolio analysis above as the Directors do not believe it is appropriate to
include these assets where the Group does not have full control over them.
On a like for like basis the whole portfolio decreased in value by 0.8% since
June 2024 (FY24: 4.7% reduction) accounting for a £2.2m like for like
decrease in value (investment, development, car park and joint venture
assets).
Maximising available capital
In the past six months we have not sold any investment properties.
In July 2024, the Company received £3.1m; the final tranche of consideration
due following the sale of its investment in YourParkingSpace in July 2022.
Net borrowings as at 31 December 2024 were £132.6m - comprising of £82.3m
(net of £0.1m unamortised loan issue costs) of 5.375% First Mortgage
Debenture Stock 2031, £25.2m of bank debt (net of cash) and £25.1m of lease
liabilities. There were a further £61.3m of undrawn revolving credit
facilities at the half-year.
Actively managing our assets
We have completed or renewed 16 commercial leases in the period representing
annual rental income of £0.6m in aggregate.
The Merrion Centre, our single largest asset, is continuing to evolve and is
proving to be a strong restaurant and leisure destination; capitalising on the
increasing footfall generated by the nearby student population. The void level
across the portfolio remains above 7%, however this is giving us the
opportunity to reimagine sections of the centre, as opposed to doing so on a
unit by unit basis.
Investing in our development pipeline
TCS owns a significant development pipeline which gives the Company a clear
and material opportunity for future growth. The current pipeline has an
estimated gross development value (GDV) of over £400m, with the majority of
the developments already being part of the relevant local government approved
strategic planning frameworks or actually in possession of detailed planning
permission.
We take a conservative approach to development to ensure we never overcommit
ourselves. Alongside this, the Company has a successful track record in
obtaining planning and delivering strategic developments.
The key components of the development pipeline include:
· Piccadilly Basin, Manchester: Mixed residential, commercial, and
car-parking with a total estimated GDV of circa £170m
· Whitehall Riverside, Leeds: Office, car-parking, and potentially leisure
provision with a total estimated GDV of over £290m
· Merrion Estate, Leeds: Office and residential towers with a total
estimated GDV of over £90m
Piccadilly Basin, Manchester
Our Dale and Burlington Street surface car parks are key components of the
Piccadilly Basin Strategic Regeneration Framework ('SRF'). We are currently
looking at refreshing this SRF to bring it up to date and relevant in order to
unlock the potential of this truly unique part of the city centre.
Whitehall Riverside, Leeds
Having secured detailed planning consent for both the No5 Whitehall Riverside
office building and neighbouring Multi-Storey Car Park we are progressing with
both the detailed design and with potential tenants. Although rental values
and demand are increasing, in particular for new build prime 'right-sized'
office space, this is not reflected in current investment yields and is
delaying physical development.
Merrion Estate, Leeds
In December 2023 a planning application was submitted for student
accommodation as part of the Merrion Centre's evolution. For the first time,
the Merrion Centre is looking to introduce residential accommodation to its
ever changing, dynamic offering that has been proudly part of the retail,
office and leisure landscape of Leeds for the last 60 years.
In a bid to address the burgeoning demand for accommodation in the area, this
planning application introduces two new buildings within the Merrion Centre.
These structures are designed to deliver 1,110 student bedrooms, comprising a
range of studios and cluster bedrooms. The student accommodations will be
complemented across both buildings with a range of amenities, including
residents' lounges, co-working spaces, meeting spaces, cinema, gym, karaoke
room, secure cycle spaces and external terraces.
This application has not yet been presented to a Leeds Plans Panel and we are
continuing to work through the design of these buildings, addressing both
changes in regulation and feedback from statutory consultees.
CitiPark - capital light growth continuing with a further car park business
acquired in the period
Our underlying car park business is resilient with a further enforcement
business acquired in the period.
We continually monitor the performance of each car park and have served
notice, in accordance with the terms of the underlying lease, to cease to
operate an underperforming multi-story car park in Watford. This has
crystallised a profit on disposal of a leasehold property of £1.0m in the
period.
Outlook
The resilient and stable trading performance reported in the six months ended
31 December 2024 is continuing into the opening months of 2025.
Overall, the business has now been reset, with a more diverse portfolio of
assets, lower levels of gearing and more importantly historically low levels
of variable rate borrowings and we are now looking predominantly at managing
our existing investments and bringing forward our development pipeline.
EPRA Net Asset reporting
The below table reconciles IFRS net assets to Net Tangible Assets (NTA), and
the other EPRA measures.
There are three EPRA Net Asset Valuation metrics, namely EPRA Net
Reinstatement Value (NRV), EPRA Net Tangible Assets (NTA) and EPRA Net
Disposal Value (NDV). The EPRA NRV scenario, aims to represent the value
required to rebuild the entity and assumes that no selling of assets takes
place. The EPRA NTA is focused on reflecting a company's tangible assets. EPRA
NDV aims to represent the shareholders' value under an orderly sale of
business, where, for example, financial instruments are calculated to the full
extent of their liability. All three NAV metrics share the same starting
point, namely IFRS Equity attributable to shareholders.
HY25 FY24
£m HY25 FY24 p per share p per share
IFRS reported NAV 119.6 119.6 284 284
Purchasers Costs (1) 16.4 18.4
EPRA Net Reinstatement Value 136.0 138.0 323 327
Remove Purchasers Costs (16.4) (18.4)
Remove Goodwill (2) (2.9) (2.9)
EPRA Net Tangible Assets 116.7 116.7 277 277
Fair value of fixed interest rate debt (3) 11.4 11.9
EPRA Net Disposal Value 128.1 128.6 304 305
(1)Estimated purchasers' costs including fees and stamp duty and related taxes
(2)Removal of goodwill as per the IFRS Balance Sheet - relates predominantly
to goodwill paid to acquire two long term car park leaseholds in London
(3)Represents the adjustment to fair value (market price) of the 2031 5.375%
debenture
Responsibility statement of the directors
The directors confirm that, to the best of their knowledge, these condensed
consolidated interim financial statements have been prepared in accordance
with IAS 34 as adopted in the United Kingdom. The interim management report
includes a fair review of the information required by DTR 4.2.4, namely:
· an indication of important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year; and
· material related party transactions in the first six months of the
financial year and any material changes in the related party transactions
described in the last Annual Report and Accounts.
A list of current directors is maintained on the Town Centre Securities PLC
Group website: www.tcs-plc.co.uk
(https://protect.checkpoint.com/v2/___http:/www.tcs-plc.co.uk___.bXQtcHJvZC1jcC1ldXcyLTE6bmV4dDE1OmM6bzo1OGJkNzlmNDRiZjQ2MTdlNjk0MWQ2YjIwM2ViYTZkYzo2Ojk5OTQ6MDU2M2U1MjM0OTU3MDM5Y2RlYjlhOTcwZjM2Mzg3YjM5NTM0ZTQzYjlhNDg0YzIxMzUzMDQ5Mzc2Y2I2Yzc1ZjpwOlQ6Tg)
.
Principal risks and uncertainties
The group set out on page 50 of its annual report and accounts 2024 the
principal risks and uncertainties that could impact its performance; these
remain largely unchanged since the annual report was published. The group
operates a structured risk management process, which identifies and evaluates
risks and uncertainties and reviews mitigation activity.
The key underlying property risks facing the business continue to relate to
tenant strength, particularly in the retail arena, portfolio valuation and the
related funding headroom which is driven by portfolio valuation.
Systems risk related to the increasing level of cyber security threats and
GDPR risk and the need to carefully control the use of personal data continue
to demand vigilance from all staff.
TCS continues to operate in a conservative manner with processes and
procedures in place to ensure risk management is central to all business
planning and decision making. These processes and procedures remain as
detailed in the 2024 annual report.
Forward-looking statements
Certain statements in this half year report are forward-looking. Although the
Group believes that the expectations reflected in these forward-looking
statements are reasonable, it can give no assurance that these expectations
will prove to have been correct. Because these statements involve risks and
uncertainties, actual results may differ materially from those expressed or
implied by these forward-looking statements.
The group undertakes no obligation to update any forward-looking statements
whether as a result of new information, future events or otherwise.
Edward Ziff OBE DL
Stewart MacNeill
Chairman and Chief Executive Group Finance Director
27 March 2025
Consolidated condensed income statement
for the six months ended 31 December 2024
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
Unaudited Unaudited Audited
Notes £000 £000 £000
Gross revenue (excl. service charge income) 15,153 14,496 28,983
Service charge income 1,496 1,633 2,985
Gross revenue 16,649 16,129 31,968
Provision for impairment of debtors - (58) -
Service charge expenses (2,163) (2,056) (3,982)
Property expenses (6,327) (5,908) (11,821)
Net revenue 8,159 8,107 16,165
Administrative expenses (4,039) (3,668) (7,293)
Other income 1,436 553 965
Reversal of impairment/(impairment) of car parking assets 7(b) 627 (1,086) (3,259)
Impairment of goodwill 8 - - (577)
Valuation movement on investment properties 7(a) (1,146) (8,310) (7,625)
Profit on disposal of investment properties - 39 27
Profit on disposal of freehold and leasehold properties 1,023 - -
Valuation movement on investments - 190 408
Loss on disposal of investments (87) (122) (191)
Share of post-tax profits/(losses) from joint ventures 9 522 (2,014) (2,175)
Operating profit/(loss) 6,495 (6,311) (3,555)
Finance 3 (3,694) (3,486) (7,209)
costs
Finance income 3 17 82 166
Profit/(loss) before taxation 2,818 (9,715) (10,598)
Taxation (2,383) 2,460 2,588
4
Profit/(loss) for the period 435 (7,255) (8,010)
All profits/(losses) for the period are attributable to equity shareholders.
Earnings/(losses) per share 6
Basic and Diluted 1.0p (15.3p) (17.9p)
EPRA (non-GAAP measure) 4.2p 7.9p 12.3p
Consolidated condensed statement of comprehensive income
for the six months ended 31 December 2024
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
Unaudited Unaudited Audited
£000 £000 £000
Profit/(loss) for the period 435 (7,255) (8,010)
Items that will not be subsequently reclassified to profit or loss
Revaluation (losses)/gains on car parking (823) 865 994
assets 7(b)
Revaluation gains on hotel 521 121 642
assets
7(c)
Revaluation losses on other (355) (138) (763)
investments
10
Deferred tax on revaluation losses/(gains) 213 (213) (236)
Total other comprehensive (losses)/income (444) 635 637
Total comprehensive loss for the period (9) (6,620) (7,373)
All recognised income for the period is attributable to equity shareholders.
The accompanying notes are an integral part of these condensed consolidated
interim financial statements.
Consolidated condensed balance sheet
as at 31 December 2024
31 December 31 December 30 June
2024 2023 2024
Unaudited Unaudited Audited
£000 £000 £000
Notes
Non-current assets
Property rental
Investment properties 7 183,087 179,012 180,977
Investments in joint ventures 9 5,188 5,109 4,752
188,275 184,121 185,729
Car park activities
Freehold and right of use properties 7 53,752 59,759 56,823
Goodwill and intangible assets 8 3,313 3,551 2,892
57,065 63,310 59,715
Hotel operations
Freehold properties 7 10,300 9,500 9,900
10,300 9,500 9,900
Fixtures, equipment and motor vehicles 7 1,430 1,178 1,446
Investments 10 3,610 4,590 3,965
Deferred tax assets 12 182 2,736 2,352
Total non-current assets 260,862 265,435 263,107
Current assets
Investments 10 - 5,234 3,996
Trade and other receivables 3,972 3,776 22,152
Cash and cash equivalents 24,790 23,593 3,177
Total current assets 28,762 32,603 29,325
Total assets 289,624 298,038 292,432
Current liabilities
Trade and other payables (12,715) (11,862) (13,425)
Bank overdrafts (22,179) (22,812) (20,760)
Financial (3,871) (4,220) (1,768)
liabilities
11
Total current liabilities (38,765) (38,894) (35,953)
Non-current liabilities
Financial (131,231) (134,681) (136,842)
liabilities
11
Deferred tax liabilities 12 - (489) -
Total liabilities (169,996) (174,064) (172,795)
Net assets 119,628 123,974 119,637
Equity attributable to owners of the Parent
Called up share capital 13 10,540 10,540 10,540
Share premium account 200 200 200
Capital redemption reserve 3,309 3,309 3,309
Revaluation reserve 4,095 3,557 4,184
Retained earnings 101,484 106,368 101,404
Total equity 119,628 123,974 119,637
Net asset value per share 15 284p 294p 284p
The accompanying notes are an integral part of these condensed consolidated
interim financial statements.
Consolidated condensed statement of changes in equity
for the six months ended 31 December 2024
Share Capital
Share premium redemption Revaluation Retained Total
capital account reserve Reserve earnings equity
£000 £000 £000 £000 £000 £000
Balance at 1 July 2023 12,113 200 1,736 2,784 124,255 141,088
Comprehensive loss for the year
Loss for the period - - - - (7,255) (7,255)
Other comprehensive income/(loss) - - - 773 (138) 635
Total comprehensive income/(loss) for the period - - - 773 (7,393) (6,620)
Contributions by and distributions to owners
Arising on purchase and cancellation of own shares (1,573) - 1,573 - (9,440) (9,440)
Dividends relating to the year ended 30 June 2022 - - - - (1,054) (1,054)
Balance at 31 December 2023 10,540 200 3,309 3,557 106,368 123,974
10,540 200 3,309 4,184 101,404 119,637
Balance at 1 July 2024
Comprehensive loss for the year
Profit for the period - - - - 435 435
Other comprehensive loss - - - (89) (355) (444)
Total comprehensive (loss)/income for the period - - - (89) 80 (9)
Balance at 31 December 2024 10,540 200 3,309 4,095 101,484 119,628
The accompanying notes are an integral part of these condensed consolidated
interim financial statements.
Consolidated condensed cash flow statement
for the six months ended 31 December 2024
Six months ended Six months ended Year ended
31 December 2024 31 December 2023 30 June 2024
Unaudited Unaudited Audited
Notes £000 £000 £000 £000 £000 £000
Cash flows from operating activities
Cash generated from operations 14 6,087 4,400 12,594
Interest received 17 - 8
Interest paid (3,114) (2,894) (6,001)
Net cash generated from operating activities 2,990 1,506 6,601
Cash flows from investing activities
Purchases and construction of investment properties - (1,544) (1,544)
Refurbishment and development of investment properties (3,310) (1,092) (2,481)
Purchases of fixtures, equipment and motor vehicles (260) (80) (525)
Proceeds from sale of investment properties - 199 187
Proceeds from sale of fixed assets 76 - -
Proceeds from sale of investments incl. loan repayments 3,095 4,377 6,658
Payments for investments (485) (250) (250)
Distributions received from joint ventures 86 - 196
Net cash (used in)/generated from investing activities (798) 1,610 2,241
Cash flows from financing activities
Proceeds from borrowings - 9,750 9,750
Repayment of borrowings (86) (3,431) (3,087)
Arrangement fees paid (50) - (419)
Principle element of lease payments (837) (834) (1,665)
Re-purchase of own shares - (9,440) (9,440)
Dividends paid to shareholders - - (4,209)
Net cash used in financing activities (973) (3,955) (9,070)
Net increase/(decrease) in cash and cash equivalents 1,219 (839) (228)
Cash and cash equivalents at beginning of period 1,392 1,620 1,620
Cash and cash equivalents at end of period 2,611 781 1,392
Cash and cash equivalents at the year-end are comprised of the following:
Cash balances 24,790 23,593 22,152
Overdrawn balances (22,179) (22,812) (20,760)
2,611 781 1,392
The Consolidated Cash Flow Statement should be read in conjunction with Note
14.
The accompanying notes are an integral part of these condensed consolidated
interim financial statements.
Notes to the consolidated interim financial information
1. Financial information
General information
Town Centre Securities PLC (the "Company") is a public limited company
domiciled in the United Kingdom. Its shares are listed on the main market of
the London Stock Exchange. The address of its registered office is Town Centre
House, The Merrion Centre, Leeds LS2 8LY. The principal activities of the
group during the period remained those of property investment, development and
trading and the provision of car parking.
This interim financial information was approved by the board on 26 March 2025.
The comparative financial information for the year ended 30 June 2024 in this
half-yearly report does not constitute statutory accounts for that year as
defined in section 434 of the Companies Act 2006. The statutory accounts for
the year ended 30 June 2024 have been delivered to the Registrar of Companies.
The auditors' report on those accounts was unqualified, did not draw attention
to any matters by way of emphasis, and did not contain a statement under
498(2) or 498(3) of the Companies Act 2006.
Basis of preparation
These condensed consolidated financial statements have been prepared in
accordance with IAS 34, "Interim Financial Reporting", in accordance with UK
adopted international accounting standards. They do not include all
disclosures that would otherwise be required in a complete set of financial
statements and should be read in conjunction with the accounts for the year
ended 30 June 2024. The financial information for the six months ended 31
December 2024 and 31 December 2023 is unaudited.
Significant accounting policies
The accounting policies adopted are consistent with those of the previous
financial year, although as the Group left the REIT regime with effect from 1
July 2023 the accounting policy on taxation has been expanded to provide
additional disclosure specifically around the transition out of the REIT
regime. Further details around this policy are detailed below.
The group's financial performance is not seasonal.
In the current environment, the directors consider revenue to be of particular
importance and therefore we set out below our revenue policy in respect of
rental income:
Rental income
Revenue includes rental income net of VAT.
Most of the Group's rental income is billed either monthly or quarterly in
advance. A receivable and deferred income is recognised at the date payment is
due
Rent receivables recognised are subject to impairment (refer to the Trade and
Other Related Party receivables policy in the financial statements of the
Company for the year ended 30 June 2024).
Any lease incentives are spread on a straight-line basis across the period of
the lease.
Rental income is recognised as revenue (to the extent it is considered
collectible) as follows:
i) Fixed rental income is recognised on a straight-line
basis over the term of the lease;
ii) turnover rents are based on underlying turnover and are
recognised in the period to which the turnover relates;
iii) rent reviews are recognised in the period to which they
relate providing they have been agreed or otherwise on agreement; and
iv) Where rent concessions have been granted that reduce the
payments due under a lease in future periods, the total revised consideration
(plus any prepaid or accrued lease payments) is spread over the remaining
lease term from the date the concession is granted.
Taxation
The Group's tax expense comprises both current tax and deferred tax expense.
Current tax is the expected tax payable on taxable profit for the year and is
calculated using tax rates and laws substantively enacted at the balance sheet
date.
A deferred tax asset represents a tax deduction that is expected to arise in a
future period. It is only recognised to the extent that it is probable that
the tax deduction will be capable of being offset against taxable profits and
gains in future periods. A deferred tax liability represents taxes which will
become payable in a future period as a result of a current or prior year
transaction. Deferred tax assets and liabilities are netted off on the balance
sheet. The tax rates used to determine deferred tax are those enacted or
substantively enacted at the balance sheet date that are expected to apply
when the deferred tax asset or liability are realised.
Current tax and deferred tax are recognised in the consolidated income
statement except when it relates to items recognised in other comprehensive
income or directly in equity, in which case it is credited or charged to other
comprehensive income or directly to equity respectively.
In the period from 2 October 2007 to 30 June 2023 the Company elected for
Group REIT status. During this period the Group did not recognise any deferred
tax assets as there was insufficient evidence to support that there would be
any future taxable profits in the Group.
The Group left the REIT regime with effect from 1 July 2023 and the profits of
the Group are now all subject to corporation tax. This has resulted in the
recognition of a deferred tax asset relating to trading losses from previous
periods where there is sufficient evidence that they will be offset against
future taxable profits.
Use of estimates and judgements
With the exception of taxation, there have been no changes in the method of
applying appropriate accounting estimates in the period. Any difference
between the receivables previously recognised and the cash subsequently
collected has been disclosed in the income statement. There have been no other
estimates of amounts reported in prior periods which have a material impact on
the current half year period.
Taxation
Significant judgment is required in determining the provision for income tax
and the calculation of any deferred tax balances. The Group recognises
liabilities for anticipated tax based on estimates of whether additional taxes
will be due. Where the final tax outcome of these matters is different from
the amounts initially recorded, such differences impact the income tax and
deferred tax provisions in the period in which such determination is made.
Some subsidiaries have generated or generate tax losses. Often these can be
used to offset taxable gains of subsequent periods. The Group monitors the
development of such tax loss situations. Based on the business plans of the
Group, the recoverability of such tax losses is determined. In the case that a
tax loss is deemed to be recoverable, the recognition of a deferred tax asset
for such a tax loss is then decided. This judgement resulted in the
recognition of a deferred tax asset as at 1 July 2023 of £2,429,000.
Going concern
The financial information for the six months ended 31 December 2024 have been
prepared on a going concern basis. In light of the current macro-economic
environment the Directors have considered various downside scenarios to the
Group's financial forecasts in assessing its ability to continue as a going
concern. Despite the negative economic impacts and the uncertainty created,
the scenarios reviewed confirm the appropriateness of preparing these
financial statements on a going concern basis. The Group is currently in
compliance with all of its covenants. The most material risks concern the
impact on the valuation of the property portfolio and our ability to meet bank
loan and debenture covenants, although the Group does have potential mitigants
at its disposal to address these uncertainties which include, but are not
limited to, further disposals of assets, pledging as additional security
ungeared properties valued at £2.3m at 31 December 2024 and seeking lender
consent to an extension of financial covenant waivers to cover extended
periods of disruption.
2. Segmental information
The chief operating decision-maker has been identified as the board. The board
reviews the group's internal reporting in order to assess performance and
allocate resources. The board has determined the operating segments based
on these reports.
Segmental assets
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Property rental 217,933 215,827 215,062
Car park activities 57,781 62,887 60,328
Hotel operations 10,300 9,500 9,900
Investments 3,610 9,824 7,142
Total assets 289,624 298,038 292,432
Segmental results
Six months ended Six months ended
31 December 2024 31 December 2023
Property Car park Hotel Invest- Property Car park Hotel Invest-
rental activities operations ments Total rental activities operations ments Total
£000 £000 £000 £000 £000 £000 £000 £000 £000 £000
Gross revenue (excl. service charge income) 6,436 6,946 1,771 15,153 6,176 6,626 1,694 14,496
- -
Service charge income 1,496 - - 1,496 1,633 - - - 1,633
Gross revenue 7,932 6,946 1,771 - 16,649 7,809 6,626 1,694 - 16,129
Provision for impairment of debtors - - - - - (58) - - - (58)
Service charge expenses (2,163) - - - (2,163) (2,056) - - - (2,056)
Property expenses (751) (4,159) (1,417) - (6,327) (818) (3,766) (1,324) - (5,908)
Net revenue 5,018 2,787 354 - 8,159 4,877 2,860 370 - 8,107
Administrative expenses (3,080) (959) - - (4,039) (2,921) (747) - - (3,668)
Other income 1,436 - - - 1,436 553 - - - 553
Share of post tax profits from joint ventures before valuation movements 522 - - 522 511 - - 511
-
Operating profit before valuation movements 3,896 1,828 6,078 3,020 2,113 5,503
354 370 -
Valuation movement on investment properties (1,146) - (1,146) (8,310) - (8,310)
- - -
Reversal of impairment/(impairment) of car parking assets - 627 627 - (1,086) (1,086)
- - -
Profit on disposal of investment properties - - - 39 - 39
- - - -
Profit on disposal of freehold and leasehold properties - 1,023 1,023 - - -
- - - -
Valuation movement on investments - - - - - - - 190
- 190
Loss on disposal of investments (87) (87) - - - (122) (122)
Valuation movement on joint venture properties - - - - (2,525) - - (2,525)
- -
Operating profit/(loss) 2,750 3,478 354 (87) 6,495 (7,776) 1,027 370 68 (6,311)
Finance costs (3,694) (3,486)
Finance income 17 82
Profit/(loss) before taxation 2,818 (9,715)
Taxation (2,383) 2,460
Profit/(loss) for the period 435 (7,255)
All results are derived from activities conducted in the United Kingdom.
The car park results include car park income from sites that are held for
future development. The value of these sites has been determined based on
their development value and therefore the total value of these assets has been
included within the assets of the property rental business.
The net revenue at the development sites for the six months ended 31 December
2024, arising from car park operations, was £622,000. After allowing for an
allocation of administrative expenses, the operating profit at these sites was
£379,000.
Revenue received within the car park and hotel segments, along with service
charge income from the property rental segment, is the only revenue recognised
on a contract basis under IFRS 15. All other revenue within the property
segment comes from rental lease agreements.
3. Finance costs
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Interest on debenture loan stock 2,215 2,215 4,430
Interest payable on bank borrowings 893 679 1,570
Amortisation of arrangement fees 138 131 286
Interest expense on lease liabilities 448 461 923
Total finance costs 3,694 3,486 7,209
Interest receivable on loans to joint ventures - - (159)
Other interest receivable (17) (82) (7)
Total finance income (17) (82) (166)
Net finance costs 3,677 3,404 7,043
4. Taxation
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Current tax
- Current year - - -
- Adjustments in respect of prior years - - -
- - -
Deferred tax
- Recognition of carried forward trading losses - (2,613) (2,888)
- Utilisation of trading losses 625 938 1,203
- Origination and reversal of timing differences 1,758 (785) (903)
(2,383) (2,460) (2,588)
(2,383) (2,460) (2,588)
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Profit/(loss) before taxation 2,818 (9,715) (10,598)
Profit/(loss) on ordinary activities multiplied by the rate of corporation tax
of 25% (2023: 19%)
705 (2,429) (2,649)
Effects of
- Valuation movements not deductible for tax purposes
1,654 2,168 2,701
- Recognition of carried forward trading losses - (2,613) (2,888)
- Expenses not deductible for tax purposes 24 414 248
2,383 (2,460) (2,588)
The Company left the REIT regime with effect from 1 July 2023, therefore the
profits of the Company are now subject to corporation tax.
5. Dividends
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
2023 final dividend: 2.5p per 25p share - 1,054 1,054
2024 interim dividend: 8.5p per 25p share - - 3,584
- 1,054 4,638
No final dividend was proposed in respect of the year ended 30 June 2024.
An interim dividend in respect of the year ending 30 June 2025 of 2.5p per
share is proposed. This dividend, based on the shares in issue at 26 March
2025, amounts to £1.054m which has not been reflected in these interim
accounts and will be paid on 13 June 2025 to shareholders on the register on
23 May 2025.
6. Earnings per share
The calculation of basic earnings per share has been based on the loss for the
period, divided by the number of shares in issue. The weighted average number
of shares in issue during the period was 42,162,679 (2023: 47,532,181).
Six months ended Six months ended Year ended
31 December 2024 31 December 2023 30 June 2024
Earnings Earnings per share Earnings Earnings Earnings Earnings
per share per share
£000 Pence £000 Pence £000 Pence
Basic earnings and earnings per share 435 1.0 (7,255) (15.3) (8,010) (17.9)
Valuation movement on investment properties 1,146 2.7 8,310 17.5 7,625 17.0
Deferred tax on valuation movements 1,758 4.2 (785) (1.6) (903) (2.0)
(Reversal of impairment)/impairment of car parking assets (627) (1.5) 1,086 2.3
3,259 7.3
Impairment of goodwill - - - - 577 1.3
Profit on disposal of investment properties - - (39) (0.1) (27) (0.1)
Profit on disposal of freehold and leasehold properties - -
(1,023) (2.4) - -
Valuation movement on properties held in joint ventures 3,200 7.2
- - 2,525 5.3
Loss on disposal of investments 87 0.2 122 0.2 191 0.4
Valuation movement on investments - - (190) (0.4) (408) (0.9)
EPRA earnings and earnings per share 1,776 4.2 3,774 7.9 5,504 12.3
EPRA earnings for 6 months ended 31 December 2023 and the year ended 30 June
2024 include a tax credit of £2,888,000 relating to the recognition of a
deferred tax asset for historical trading losses.
There is no difference between basic and diluted earnings per share.
There is no difference between basic and diluted EPRA earnings per share.
7. Tangible fixed assets
(a) Investment properties - property rental business
Right of use asset
Freehold Development Total
£000 £000 £000 £000
Valuation at 1 July 2023 160,700 2,250 20,851 183,801
Additions at cost - 2,860 - 2,860
Other capital expenditure 1,716 - 765 2,481
Disposals (160) - - (160)
Valuation movement (10,466) 6 2,835 (7,625)
Movement in tenant lease incentives (380) - - (380)
Valuation at 1 July 2024 151,410 5,116 24,451 180,977
Capital expenditure 1,833 - 1,478 3,311
Valuation movement 2,717 (70) (3,793) (1,146)
Movement in tenant lease incentives (55) - - (55)
Valuation at 31 December 2024 155,905 5,046 22,136 183,087
(b) Freehold and right of use properties - car park activities
Right of use
Freehold asset Total
£000 £000 £000
Book Value at 1 July 2023 25,110 35,681 60,791
IFRS16 adjustment (95) (95)
Depreciation (272) (1,336) (1,608)
Valuation movement 994 - 994
Impairment 768 (4,027) (3,259)
Book Value at 1 July 2024 26,600 30,223 56,823
IFRS16 adjustment - (48) (48)
Disposals - (2,098) (2,098)
Depreciation (144) (585) (729)
Valuation movement (823) - (823)
Reversal of impairment/(impairment) 1,297 (670) 627
Book Value at 31 December 2024 26,930 26,822 53,752
The historical cost of freehold properties and right-of-use assets relating to
car park activities is £30,153,000 (2023: £30,153,000).
(c) Freehold properties - hotel operations
Freehold
£000
Valuation at 30 June 2023 9,500
Depreciation (242)
Valuation movement 642
Valuation at 1 July 2024 9,900
Depreciation (121)
Valuation movement 521
Valuation at 31 December 2024 10,300
The fair value of the Group's investment and development properties, freehold
car parks, hotel operations and assets held for sale have been determined
principally by independent, appropriately qualified external valuers CBRE at
31 December 2024 and at prior dates by CBRE and Jones Lang LaSalle. The
remainder of the portfolio has been valued by the Property Director.
Valuations are performed bi-annually and are performed consistently across the
Group's whole portfolio of properties. At each reporting date appropriately
qualified employees verify all significant inputs and review computational
outputs. The external valuers submit and present summary reports to the
Property Director and the Board on the outcome of each valuation round.
Valuations take into account tenure, lease terms and structural condition. The
inputs underlying the valuations include market rents or business
profitability, incentives offered to tenants, forecast growth rates, market
yields and discount rates and selling costs including stamp duty.
The development properties principally comprise land in Leeds and Manchester.
These have also been valued by appropriately qualified external valuers Jones
Lang LaSalle, taking into account an assessment of their realisable value in
their existing state and condition based on market evidence of comparable
transactions and residual value calculations.
Leasehold (right-of-use) car park properties are accounted for using the cost
model including an assessment of the future value of the minimum lease
payments and are amortised on a straight line basis over the remaining term of
the lease or useful economic live if deemed to be shorter.
Property income, values and yields have been set out by category in the table
below.
Initial Reversionary yield
Passing rent ERV Value yield
£'000 £'000 £000 % %
Retail and leisure 645 1,469 15,830 3.8 8.8
Merrion Centre (excluding offices) 3,984 4,892 48,634 7.7 9.5
Offices 2,792 4,787 46,191 5.7 9.8
Hotels 929 929 10,300 8.5 8.5
Out of town retail 1,041 1,341 13,000 7.6 9.8
Residential 1,495 1,835 34,500 4.1 5.0
10,886 15,253 168,455 6.1 8.6
Development property 22,136
Car parks 36,605
IFRS16 adjustment - right-of-use assets 19,943
247,139
Investment properties (freehold and right of use) and hotel operations
The effect on valuation (excluding development property and car parks) of
applying a different yield and a different ERV would be as follows:
Valuation at an initial yield of 5.1% - £201.4m, Valuation at 7.1% - £144.8m
Valuation at a reversionary yield of 7.6% - £190.7m, Valuation at 9.6% -
£150.8m
Investment properties (development properties)
The key unobservable inputs in the valuation of one of the Group's development
properties of £16.4m is the assumed per acre or per unit land value. The
effect on the development property valuation of applying a different assumed
per acre or per unit land value would be as follows:
Valuation in the Consolidated Financial Statements if a 5% increase in the per
acre or per unit value - £17.3m, 5% decrease in the per acre or per unit
value - £15.6m.
The other key development property in the Group is valued on a per acre
development land value basis, the effect on the development property valuation
of applying reasonable sensitivities would not create a material impact.
Freehold car park activities
The effect on the total valuation of the Group's freehold car park properties
of £26.9m in applying a different yield/discount rate would be as follows:
Valuation in the Consolidated Financial Statements based on a 1% decrease in
the yield/discount rate - valuation increase to £31.7m, 1% increase in the
yield/discount rate - valuation decrease to £23.4m
Property valuations can be reconciled to the carrying value of the properties
in the balance sheet as follows:
Investment Freehold and right of use Hotel operations
properties Properties
Total
£000 £000 £000 £000
Externally valued by CBRE 179,470 26,930 10,300 216,700
Investment properties valued by the Directors 2,301 - - 2,301
Properties held at valuation 181,771 26,930 10,300 219,001
IFRS 16 right-of-use assets held at depreciated cost 1,316 26,822 - 28,138
183,087 53,752 10,300 247,139
All investment properties, freehold properties held in property plant and
equipment, hotel operations and assets held for sale are measured at fair
value in the consolidated balance sheet and are categorised as level 3 in the
fair value hierarchy as defined in IFRS13 as one or more inputs to the
valuation are partly based on unobservable market data. In arriving at their
valuation for each property (as in prior years) both the independent external
valuers and the Directors have used the actual rent passing and have also
formed an opinion as to the two significant unobservable inputs being the
market rental for that property and the yield (i.e. the discount rate) which a
potential purchaser would apply in arriving at the market value. Both these
inputs are arrived at using market comparables for the type, location and
condition of the property.
(d) Fixtures, equipment and motor vehicles
Accumulated Net book
Cost depreciation value
£000 £000 £000
At 1 July 2023 5,570 (4,301) 1,269
Additions 525 - 525
Depreciation - (348) (348)
At 1 July 2024 6,095 (4,649) 1,446
Additions 260 - 260
Disposals (135) 59 (76)
Depreciation - (200) (200)
At 31 December 2024 6,220 (4,790) 1,430
8. Goodwill and intangible assets
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Goodwill
At start of the period 2,868 3,445 3,445
Impairment - - (577)
2,868 3,445 2,868
Intangible assets
At start of period 24 229 229
Additions 486 - -
Amortisation (65) (123) (205)
445 106 24
Total goodwill and intangible assets 3,313 3,551 2,892
Goodwill represents the difference between the fair value of the consideration
paid on the acquisitions of car park businesses and the fair value of the
assets and liabilities acquired as part of these business combinations.
Intangible assets represent short term customer contracts relating to car park
enforcement businesses acquired in the periods.
9. Investments in joint ventures
Six months Six months Year
ended ended Ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Interest in joint ventures
At start of period 4,752 7,123 7,123
Share of profits after tax 522 511 1,025
Valuation movement - (2,525) (3,200)
Distributions (86) - (196)
At end of period 5,188 5,109 4,752
Investments in joint ventures relates to the Group's interest in the
partnership capital of Merrion House LLP. The investment property held within
this joint venture has been externally valued at each reporting date.
10. Investments
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Current Assets
Loan notes - Deferred Consideration - 3,101 3,177
Loan notes - Contingent Consideration - 2,133 -
- 5,234 3,177
Non-Current Assets
Listed investments 2,950 3,930 3,305
Non-listed investments 660 660 660
3,610 4,590 3,965
3,610 9,824 7,142
Listed investments
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
At start of the period 3,305 4,068 4,068
Decrease in value of investments (355) (138) (763)
At the end of the period 2,950 3,930 3,305
Listed investments relate to an equity shareholding in a company listed on the
London Stock Exchange. This is stated at market value in the table above and
has a historic cost of £875,482 (2023: £875,482).
Listed investments are measured at fair value in the consolidated balance
sheet and are categorised as level 1 in the fair value hierarchy as defined in
IFRS 13 as the inputs to the valuation are based on quoted market prices.
The maximum risk exposure at the reporting date is the fair value of the other
investments.
Non-listed investments
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
At the start and end of the year 660 410 410
Additions - 250 250
660 660 660
Loan Notes - Deferred Consideration
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Current assets
At the start of the year 3,177 4,493 4,493
Transferred from non-current assets - 3,025 3,025
Loan interest 14 82 158
Expenses (87) - (122)
Loan notes repaid to the Company in the period (3,104) (4,499) (4,377)
- 3,101 3,177
Non-current assets
At the start of the year - 3,025 3,025
Transferred to current assets - (3,025) (3,025)
- - -
The interest earned on the deferred consideration loan notes is 5% per annum.
The deferred consideration loan notes are accounted for using the amortised
cost basis and are assessed for impairment under the IFRS 9 expected credit
loss model.
Loan Notes - Contingent Consideration
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
At the start of the year - 1,943 1,943
Unwind of discount applied to contingent consideration - 32 32
Valuation movement - 158 408
Expenses - - (102)
Amounts received at maturity - - (2,281)
- 2,133 -
The contingent consideration loan notes were initially recognised at fair
value, based on the estimated performance of YPS in the 14 month period ended
October 2023. This was an estimate prepared by the Company. The contingent
consideration loan notes are then accounted for using the fair value through
profit and loss basis.
These loan note assets were categorised as level 3 in the fair value hierarchy
as defined in IFRS 13 as the inputs to the valuation are based on unobservable
inputs.
11. Financial liabilities
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Current
Bank borrowings - revolving credit facilities 2,444 2,452 -
Lease liabilities 1,427 1,768 1,768
3,871 4,220 1,768
Non-Current
Bank borrowings - revolving credit facilities 11,023 10,870 13,434
Bank borrowings - single asset facility 14,203 14,277 14,239
Lease liabilities 23,664 27,203 26,833
5.375% First mortgage debenture stock 82,341 82,331 82,336
131,231 134,681 136,842
135,102 138,901 138,610
Fair value of current borrowings
The fair value of bank borrowings and overdrafts approximates to their
carrying value.
Fair value of non-current borrowings
31 December 2024 31 December 2023 30 June 2024
Book value Fair value Book value Fair value Book value Fair value
£000 £000 £000 £000 £000 £000
Debenture stock 82,341 70,935 82,331 75,095 82,337 72,506
Revolving credit facilities 13,467 13,467 10,870 10,870 13,434 13,434
Single asset facility 14,203 12,418 14,313 14,313 14,239 12,174
12. Deferred tax assets and liabilities
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Assets
Carried forward losses 1,060 1,675 1,685
Leases 6,273 1,061 7,150
7,333 2,736 8,835
Liabilities
Leases 4,985 - 5,418
Investment property revaluation gains 2,166 489 1,065
7,151 489 6,483
Net deferred tax asset 182 2,247 2,352
The Company left the REIT regime with effect from 1 July 2023, therefore the
profits of the Company are now subject to corporation tax. This has resulted
in the recognition of a deferred tax asset, primarily relating to trading
losses from previous periods that are available to offset taxation on future
profits.
The Company also has various non-trading losses from previous periods, however
these have not been recognised within the deferred tax asset as it is not
certain when these will be available to offset further profits. The total
value of losses not included within the deferred tax asset is £1,328,000. In
addition the Group has uncrystalised capital losses of £27,594,000 on
investment property and car park valuation losses that have not been
recognised.
The movement in the total net deferred tax balance as at 31 December 2024
includes the charge to the income statement of £2,383,000 plus the reduction
in deferred tax liabilities arising in the period on revaluation gains
recognised in the consolidated condensed statement of comprehensive income of
£213,000.
13. Called up equity share capital
Authorised
164,879,000 (30 June 2024: 164,879,000) ordinary shares of 25p each.
Issued and fully paid Number of shares Nominal
up
value
000 £000
At 1 July 2024 42,163 10,540
Purchase and cancellation of own shares - -
At 31 December 2024 42,163 10,540
14. Cash flows from operating activities
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Profit/(loss) for the period before taxation 2,818 (9,715) (10,598)
Depreciation 1,050 1,063 2,199
Amortisation 65 123 205
Profit on disposal of investment properties - (39) (27)
Profit on disposal of freehold and leasehold property (1,023) - -
Loss on sale of investments 87 122 191
Movement in valuation of investments - (190) (408)
Finance costs 3,694 3,486 7,209
Finance income (17) (82) (166)
Share of joint venture (profits)/losses after tax (522) 2,014 2,175
Movement in revaluation of investment properties 1,146 8,310 7,625
Movement in lease incentives 55 264 380
(Reversal of impairment)/impairment of car parking assets (627) 1,086 3,259
Impairment of goodwill - - 577
Decrease/(increase) in receivables 24 (511) (731)
(Decrease)/increase in payables (663) (1,531) 704
Cash generated from operations 6,087 4,400 12,594
15. Net asset value per share
Net asset value per share is calculated as the net assets of the Group
attributable to shareholders at each balance sheet date, divided by the number
of shares in issue at that date.
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
Net asset value (£'000) 119,628 123,974 119,637
Number of ordinary shares in issue (000) 42,163 42,163 42,163
Net asset value per share (pence) 284p 294p 284p
16. Related party information
The only related party transactions that have taken place during the period
relate to the remuneration of the Executive Directors and other members of the
concert party, who are the key management personnel of the Group. Dividends
paid to the Directors and their family members are also related party
transactions although there were no dividends paid in the period.
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2024 2023 2024
£000 £000 £000
Short-term employee benefits 1,226 1,305 2,473
Post-employment benefits 48 - 89
Dividends paid to the Ziff Concert Party - - 2,641
1,274 1,305 5,203
The Ziff Concert Party includes Edward Ziff, Ben Ziff (Executive Directors)
and Michael Ziff (Non Executive Director) together with their immediate family
members, the estate of Edward Ziff and Michael Ziff's late mother, their
sister and a number of trusts that Edward Ziff and Michael Ziff are not
beneficiaries of but they do control.
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