Source - RNS
RNS Number : 3341R
Mountview Estates PLC
14 June 2018
 

MOUNTVIEW ESTATES P.L.C.

 

Preliminary Results for the year ended 31 March 2018

 

CHIEF EXECUTIVE OFFICER'S STATEMENT

 

It is always disappointing to report profits that have fallen but in the present uncertain economic climate I consider that my team have given a very good performance.  In uncertain times transactions usually take longer to complete and so it is that during the year ended 31 March 2018 we completed significantly less sales than in the previous financial year.  This fall in the number of sales has caused the fall in profits to a far greater degree than any perceived fall in prices.

 

Whilst the sales figures have fallen, the cost of the purchases which we have made during this financial year has increased by over 50% compared with the previous year.  It is purchases that are the future of the Company and I am pleased to report that it is not only the quantity of purchases but also the quality of the purchases that has improved.

 

It is now nearly 30 years since regulated tenancies were last created but this asset class continues to exist in sufficient quantities to be the mainstay of our business.  The percentage of vacant possession value that has to be paid for such assets has increased over the years but, given our low gearing, we believe that we continue to be able to produce the best returns that are available within our area of expertise in the property industry.  We have made modest diversification into life tenancies and as leases become shorter where we are the ground landlord there is money to be made in granting lease extensions. Nevertheless these are only supplementary to our main business of buying residential properties that are subject to regulated tenancies and awaiting vacant possession.

 

Whilst regulated tenancies continue to exist for longer than may have been anticipated when the 1988 Rent Act became effective a business as narrowly focused as our does have a finite life.  The business will continue to prosper but it will become increasingly difficult to replace stock as it is sold.  Some shareholders may wish to pursue their own avenues of diversification without selling Mountview shares and so the final dividend payable on 13 August 2018 will be increased to 200 pence per share.  This will make a total of 400 pence per share in respect of the Company's year ended 31 March 2018.

 

Your Board is aware that the taxation of dividend income has changed and, while 400 pence per share is an increase of a third compared with 300 pence per share last year, the 300 pence per share in respect of the Company's year ended 31 March 2016 was worth 333 pence gross in the hands of ordinary rate taxpayers.  Thus your Board are happy to admit that the new total dividend is only an increase of 20% over the total of two years ago.  The new dividend will be nearly twice covered.

 

This Statement does not seek to deny that profits have fallen but the business remains soundly based and financially secure.  When Brexit negotiations and other economic uncertainties are resolved the purchases we are presently able to make will realise good profits and we can look forward to future increased earnings.

 

As has always been the case your Board only increase dividends when they are confident of maintaining that increase and so it is reasonable to expect the increase to 400 pence per share to be maintained in future years.

 

Finally, it is only possible to maintain the Company's high level of performance because of the quality of the personnel in the team that I have around me.  On behalf of all shareholders, I wish to thank all my hard-working and loyal staff and colleagues for the contribution they each make to the continuing well-being of Mountview Estates P.L.C.

 

Duncan Sinclair

14 June 2018

 

 

MOUNTVIEW ESTATES P.L.C.

 

FINANCIAL HIGHLIGHTS

 

 

 

 

 

   2018

 

 

2017

 

 

(Decrease)/Increase

 

 

 

£

 

£

 

%

 

 

 

 

 

 

 

 

Revenue (millions)

 

 

70.3

 

78.2

 

                       (10.1)

 

 

 

 

 

 

 

 

 

Gross Profit (millions)

 

 

43.4

 

52.1

 

                          (16.7)

 

 

 

 

 

 

 

 

 

Profit Before Tax (millions)

 

 

36.9

 

45.0

 

(18.0)

 

 

 

 

 

 

 

 

Profit Before Tax excluding investment properties revaluation (millions)

 

 

37.3

 

46.0

 

                         (18.9)

 

 

 

 

 

 

 

 

Equity Holders' Funds (millions)

 

 

354.5

 

336.3

 

5.4

 

 

 

 

 

 

 

 

Earnings per share (pence)

 

 

766.4

 

929.1

 

(17.5)

 

 

 

 

 

 

 

 

Net assets per share (£)

 

 

90.91

 

86.25

 

5.4

 

 

 

 

 

 

 

 

Dividend per share (pence)

 

 

400

 

300

 

33.3

 

 

 

 

 

 

 

 

 

Mountview Estates P.L.C. advises its shareholders that, following the issue of the final results, the relevant dates in respect of the proposed final dividend payment of 200 pence per share are as follows:

 

Ex-dividend date

 

 5 July 2018

Record date

 6 July 2018

 

Payment date

13 August 2018

 

 

  

MOUNTVIEW ESTATES P.L.C.

 

CONSOLIDATED INCOME STATEMENT

 

FOR THE YEAR ENDED 31 MARCH 2018

  

 

          Year

 

Year

 

ended

 

ended

 

31.03.2018

 

31.03.2017

 

£'000

 

£'000

 

 

 

 

REVENUE

  70,272

 

78,232

 

 

 

 

Cost of sales

(26,915)

 

(26,176)

 

 

 

 

GROSS PROFIT

43,357

 

52,056

 

 

 

 

Administrative expenses

(5,507)

 

(5,231)

Gain on sale of investment properties

145

 

0

 

 

 

 

Operating profit before changes in

fair value of investment properties

37,995

 

46,825

 

 

 

 

(Decrease) in fair value of investment  properties

(376)

 

(1,020)

 

 

 

 

PROFIT FROM OPERATIONS

37,619

 

45,805

 

 

 

 

Net finance costs

(714)

 

(819)

 

 

 

 

PROFIT BEFORE TAXATION

36,905

 

44,986

 

 

 

 

Taxation - current

(7,197)

 

(9,234)

Taxation - deferred

173

 

473

 

 

 

 

Taxation

(7,024)

 

(8,761)

 

 

 

 

PROFIT ATTRIBUTABLE TO EQUITY SHAREHOLDERS

29,881

 

36,225

 

 

 

 

Basic and diluted earnings per share (pence)

766.4p

 

929.1p

 

 

 

 

 

MOUNTVIEW ESTATES P.L.C.

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 

FOR THE YEAR ENDED 31 MARCH 2018

 

 

 

As at

As at

 

 

31.03.2018

31.03.2017

 

 

£'000

£'000

ASSETS

 

 

 

NON-CURRENT ASSETS

 

 

 

Property, plant and equipment

 

  1,771

1,833   

Investment properties

 

27,825

28,741

 

 

 

 

 

 

29,596

30,574

CURRENT ASSETS

 

 

 

Inventories of trading properties

 

376,879

347,380

Trade and other receivables

 

    1,859

    1,613

Cash at bank

 

    5,368

       825

 

 

 

 

 

 

384,106

349,818

 

 

 

 

TOTAL ASSETS

 

413,702

380,392

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

Share capital

 

        195

     195

Capital redemption reserve

 

          55

       55

Capital reserve                                

 

          25

       25

Other reserve

 

          56

       56

 

 

 

 

Retained earnings

 

354,131

335,948

 

 

 

 

 

 

354,462

336,279

NON-CURRENT LIABILITIES

 

 

 

Long-term borrowings

 

  49,900

29,000

Deferred tax

 

    4,696

  4,869

 

 

 

 

 

 

  54,596

33,869

 

 

 

 

CURRENT LIABILITIES

 

 

 

Bank overdrafts and short-term loans

 

      463

3,042

Trade and other payables

 

   1,843

1,951

Current tax payable

 

   2,338

5,251

 

 

 

 

 

 

    4,644

10,244

 

 

 

 

TOTAL LIABILITIES

 

  59,240

44,113

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

413,702

380,392

 

 

 

 

MOUNTVIEW ESTATES P.L.C.

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 

FOR THE YEAR ENDED 31 MARCH 2018

 

 

 

 

 

 

Capital

 

 

 

 

Share

Capital

Redemption

Other

Retained

 

 

Capital

Reserve

Reserve

Reserves

Earnings

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 April 2016

195

25

55

56

311,421

311,752

 

 

 

 

 

 

 

Profit for the year

 

 

 

 

36,225

36,225

 

 

 

 

 

 

 

Dividends

 

 

 

 

(11,698)

(11,698)

 

 

 

 

 

 

 

Balance as at 31 March  2017

195

25

55

56

335,948

336,279

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital

 

 

 

 

Share

Capital

Redemption

Other

Retained

 

 

Capital

Reserve

Reserve

Reserves

Earnings

Total

 

£'000

£'000

£'000

£'000

£'000

£'000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as at 1 April 2017

195

25

55

56

335,948

336,279

 

 

 

 

 

 

 

Profit for the year

 

 

 

 

   29,881

  29,881

 

 

 

 

 

 

 

Dividends

 

 

 

 

 (11,698)

 (11,698)

 

 

 

 

 

 

 

Balance as at 31 March  2018

195

25

55

56

354,131

354,462

 

 

 

 

 

 

 

 

 

 

MOUNTVIEW ESTATES P.L.C.

 

GROUP CASH FLOW STATEMENT

 

FOR THE YEAR ENDED 31 MARCH 2018

 

 

                                        

 

 

Year

 

 

                                      Year

 

 

 

ended

 

ended

 

 

 

31.03.2018

 

31.03.2017

 

 

 

 

 

£'000

Cash flow from operating activities

 

 

 

 

 

 

 

 

 

 

 

Operating profit  

 

 

37,619

 

45,805

Adjustment for:

 

 

 

 

 

Depreciation

 

 

66

 

79

 

 

 

 

 

 

Gain on disposal of investment properties

 

 

(145)

 

-

Decrease in fair value of investment properties

 

 

376

 

1,020

Cash flow from operations before changes in working capital 

 

 

37,916

 

46,904

 

 

 

 

 

 

(Increase) in inventories

 

 

(29,499)

 

(13,272)

(Increase)Decrease in receivables

 

 

(246)

 

107

(Decrease) in payables

 

 

(108)

 

(1,049)

 

 

 

 

 

 

 

 

 

 

 

 

Cash generated from operations

 

 

8,063

 

32,690

 

 

 

 

 

 

Interest paid

 

 

(714)

 

(819)

Income taxes paid

 

 

(10,110)

 

(9,458)

 

 

 

 

 

 

Net cash (outflow)/ inflow from operating activities

 

 

(2,761)

 

22,413

 

 

 

 

 

 

Investing activities

 

 

 

 

 

Proceeds from disposal of investment properties

 

 

685

 

-

Capital expenditure on investment properties

 

 

-

 

(312)

Purchase of property, plant and equipment

 

 

(4)

 

(1)

 

 

 

 

 

 

Net cash inflow/(outflow) from investing activities

 

 

681

 

(313)

 

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

 

Increase/(Repayment) of borrowings

 

 

20,483

 

(9,820)

Equity dividend paid

 

 

(11,698)

 

(11,698)

 

 

 

 

 

 

Net cash inflow/(outflow) from financing activities

 

 

8,785

 

(21,518)

 

 

 

 

 

 

Net  increase in cash and cash equivalents

 

 

6,705

 

582

 

 

 

 

 

 

 

Opening cash and cash equivalents

 

 

 

 

(1,337)

 

 

(1,919)

Cash and cash equivalents at the end of the year

 

 

5,368

 

(1,337)

 

Notes to the Preliminary Announcement

 

1.   Financial Information

 

The financial information presented within this document does not comprise the statutory accounts for the financial years ended 31 March 2018 and 31 March 2017, but represents extracts from them.

 

The statutory accounts for the financial year ended 31 March 2017 have been filed with the Registrar of Companies.  The auditor reported on those accounts: their report was (i) unqualified, (ii) did not include references to any matters to which the auditor drew attention by way of emphasis without qualifying the reports and (iii) did not contain statements under section 498(2) or (3) of the Companies Act 2006.

 

The statutory accounts for the year ended 31 March 2018 are expected to be finalised and signed following approval by the Board of Directors and delivered to the Registrar of Companies following the Company's Annual General Meeting on 8 August 2018.

 

2.   Basis of Preparation

 

The preliminary announcement has been prepared in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRS") but does not contain sufficient information to comply fully with IFRS.  The Financial Statements to be presented to Members at the 2018 AGM are expected to comply fully with IFRS.

 

 ~ Ends ~

 

This announcement contains information which, prior to its disclosure, was inside information for the purposes of the Market Abuse Regulation.

 

  

For further information on the Company, visit: www.mountviewplc.co.uk 

SPARK Advisory Partners Limited (Financial Advisor)   www.sparkadvisorypartners.com 

Miriam Greenwood                                                      0203 368 3553

Mark Brady                                                                  0203 368 3551

 

 


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