TIDMMAR
RNS Number : 0615D
Mar City PLC
25 March 2014
25 March 2014 MAR CITY PLC
('Mar City' or 'the Company')
Final results for the year ended 31 December 2013
Mar City (AIM: MAR.L) the London and Midlands focused
housebuilder today announces its final results for the year ended
31 December 2013.
Financial highlights 2013 2012 Change
GBPk GBPk %
Revenue 24,823 8,970 +177%
Underlying operating
profit * 3,555 1,019 +249%
Underlying PBT * 3,432 978 +251%
Exceptional costs * (211) - -
Operating profit 3,344 1,019 +228%
PBT 3,221 978 +229%
Basic EPS ** 6.46p 3.89p +66%
* Adjusted for exceptional costs of GBP211k relating to
acquisition of Mar City Land Ltd, which completed on 16 December
2013
** Re-stated following a 1 for 10 share consolidation, which
took place on 20 December 2013.
-- Strong performance in 2013, with significant growth in revenue and profits.
o Revenue up 177% with work progressing on all 10 contracts
previously announced.
o Underlying operating profits* increased to GBP3,555k,
generating a return of 14.3% on turnover.
o Underlying PBT * increased by 251% to GBP3,432k.
o Reported PBT (after exceptional costs of acquisition)
increased to GBP3,221k.
o Net assets increased from GBP1.3m to GBP65.7m, with strong net
cash position of GBP17.0m.
-- Transformational fund raise and land acquisition completed.
o The land acquisition of GBP30.8 million secured over 500
housing units across eight sites, with four sites already under
development and now generating sales completions.
o The new equity funding secured in December increased cash
balances by a net GBP27.8 million which will be used to acquire
additional land in 2014.
Outlook for 2014
-- Strong new sales pipeline, benefitting from the 'Help to Buy'
scheme which is helping first time buyers, young professionals and
families into home ownership.
-- Additional equity funding increased cash balances by a net
GBP27.8 million which will be used to acquire additional land
during 2014 and a number of negotiations are already well advanced
for sites in London, the South East and the Midlands.
o Following the fund raise Mar City has acquired 622 further
plots across London and the Midlands, as announced today.
o Strong pipeline with a target of at least 2,000 plots this
year, which would create a land bank of at least of 3 years, by the
end of the current year.
-- Significant levels of reservations already taken in 2014,
with completions generating cash and revenues, giving confidence
that the significant growth forecast for 2014 can be delivered.
Commenting on the results and outlook, Tony Ryan, CEO of Mar
City plc, said:
I am delighted to report that Mar City performed very strongly
during the year, with operating efficiencies delivering improved
margins and as a consequence the results for the year were ahead of
previous expectations.
Mar City is now a substantial national housebuilder, as the
Business was transformed with the very successful, oversubscribed
fund raising and acquisition of Mar City Land Ltd, which completed
on 16 December. This created the platform for significant growth,
with the land acquired providing a springboard for future
expansion, whilst the strengthening of the existing management team
and the Business' processes ensured that Mar City is suitably
structured to scale and deliver further strong growth.
The Group has also benefited significantly from continued
strength in the UK housing market. Improving consumer confidence,
stimulated by new government backed schemes and increasing
employment levels, has meant Mar City is experiencing exceptional
levels of demand. In particular, the Government's newly extended
'Help to Buy' scheme has brought forward significantly improved
results to the sector and we believe Mar City are well placed to
benefit as it continues to do so, allowing first time buyers, young
professionals and families to enter into home ownership.
Indeed, Mar City is already experiencing high levels of interest
in its open market sales developments, which are translating into
high levels of reservations and private sales completions in 2014,
whilst sales opportunities with HA's and RSL's also remain
buoyant.
With a strong balance sheet and cash and debt facilities, we are
well positioned to secure additional sites in the coming year. It
is our intention to remain highly selective in all future land
acquisitions, ensuring we are purchasing the right sites, in the
right location, off market, at the right price.
Following the fund raise and as announced today, we have
acquired a further 622 plots across London and the Midlands and
will continue to build our land bank this year. We have a strong
pipeline and are seeking to acquire at least 2,000 plots this year,
which would create a land bank of at least 3 years, by the end of
the current year.
Our goal is to run Mar City in a prudent and sustainable manner,
minimising financial risk and creating quality homes, in vibrant
local communities. Excellent progress has been made in 2013 in
establishing the Company in London and the South East, along with
the well-established markets in the West and East Midlands and the
corridor inbetween the Midlands and London
We have positioned Mar City to take full advantage of a strong
housing market and our ability to grow the Company considerably
over the foreseeable future in a sustainable manner. In doing so,
we believe we can deliver strong returns to our shareholders with
the added intent of implementing a progressive dividend policy in
the second half of 2014 and we believe we are insulated against any
geopolitical events, as we are at the affordable end of the
market.
Enquiries:
Mar City PLC www.marcityplc.com www.marcityhomes.com
Hamilton Anstead, Chairman
Tony Ryan, Chief Executive +44 (0) 20 7408 1102
Marcus Jones, Finance Director
WH Ireland Limited, Nomad and www.wh-ireland.co.uk
Joint Broker
Mike Coe +44 (0) 117 945 3470
Shore Capital, Joint Broker www.shorecap.co.uk
Dru Danford / Stephane Auton
/ Jamie Cameron +44 (0)20 7408 4090
Gable Communications marcity@gablecommunications.com
John Bick / Justine James +44 (0) 20 7193 7463
Chairman's Statement
For the year ended 31 December 2013
I am very pleased to report the results for the Group for the
year ended 31 December 2013 which has been an exceptional and
transformational year for Mar City PLC.
Financial results for the year
The Group generated a profit before taxation of GBP3.22m (2012:
GBP0.98m) after charging GBP211k of exceptional costs relating to
the transactions described below on revenue of GBP24.8 million
(2012: GBP8.97 million). This has resulted in basic earnings per
share of 6.46 pence (2012: 3.89 pence). As at 31 December 2013 the
Group had net assets of GBP65.7m (2012: GBP1.3m). The Board is not
proposing the payment of a dividend in respect of 2013 (2012:
nil).
The transformational transaction set out below completed the
establishment of Mar City as an independent house builder, although
the results for 2013 include contracting revenues only. These
revenues grew by 177% compared to 2012 reflecting the previously
announced contracts which have progressed as expected. Underlying
operating profit of GBP3.55m (2012: GBP1.02m) represents a 14.3%
return on revenues and is ahead of previous expectations as a
result of positive variations on certain contracts.
Although figures for 2014 will still include a significant
element of contracting income, overall results will be more
reflective of the number of units sold and average selling prices
achieved in a similar manner to other house builders. This will
therefore lead to a new income stream in 2014 and an associated new
accounting policy, with revenue recognised on non-contracting sites
based on sales completions.
Share placing, land acquisition and share consolidation
On 16 December 2013, the Group completed the placing of 437.5
million new ordinary shares with institutional and other investors
at a price of 8 pence per share to raise GBP35.0 million before
expenses. At the same time, the Group acquired 8 sites of land
principally through the acquisition of Mar City Land Ltd. These
sites, equivalent to a land bank of 512 plots, were acquired for an
aggregate net consideration of GBP30.8 million. The consideration
was satisfied as to GBP5.0 million in cash and GBP25.8 million by
the issue of new ordinary shares at a price equivalent to 80p, post
consolidation.
Prior to the completion of the above transactions, the business
of the Group was that of a contractor with all contracts to build
houses having been signed with Mar City Developments Ltd (MCDL). Of
the 8 sites acquired, 4 are developments on which the Group has
already contracted with MCDL to build houses, but the Group has now
also acquired the land, and the remaining 4 sites have planning
permission and are immediately available for the Group to
develop.
The strategy of your Board has always been to establish the
Group as a leading independent house builder. The above
transactions complete the transformation of the Group from a
contracting business to an independent house builder with the cash
resources and expertise to grow substantially in the strong market
conditions being experienced currently and against the backdrop of
enormous housing shortages in the UK.
As part of the reorganisation of the Group's financial affairs,
a share consolidation was also completed on 16 December 2013 on the
basis of one new consolidated ordinary share for every ten existing
ordinary shares.
The Board
Following on from the transactions described above, I would like
to welcome two new non-executive directors to the Board of Mar
City.
Professor Alan Birks CBE has extensive experience in further
education in both teaching and management roles. He was Principal
of South Birmingham College for 20 years until August 2007 and has
held a number of high profile Interim Principal and consultancy
roles since then. He has a BSc in Economics, a BA in Maths and
Computing and a Post Graduate Diploma in Accounting and Finance.
His all-round skills are a welcome addition to the Board and he
will also become a member of the Audit Committee and the
Remuneration Committee.
Michael Brown is an investment manager at Henderson Volantis, a
UK smaller companies division of Henderson Global Investors.
Michael leads Henderson Volantis' corporate governance engagement
and their investments in the house building sector. He made a
valuable contribution to Mar City's development during 2013 in
presenting an institutional view on capital allocation and
structure to the executive team. Michael will bring a very valuable
perspective and experience to the Board and he will also become a
member of the Remuneration Committee.
People
The Group is rapidly developing a presence and reputation in
London and the South East and our centrally based London office is
growing carefully in line with our chosen strategy of an increasing
number of developments in these areas. The significant majority of
our design, construction and accounting staff are however located
at our office in central Birmingham. The Board of Mar City would
again wish to thank all the staff of the Group for their hard work
and loyalty in 2013 which has seen such tremendous progress for the
organisation.
Hamilton Anstead
Chairman 24 March 2014
CEO's report
For the year ended 31 December 2013
Business review
2013 was an exciting and transformational year for Mar City.
The Business performed very strongly during the year, with
operating efficiencies delivering improved margins and as a
consequence the results for the year were ahead of previous
expectations.
Mar City is now a substantial national housebuilder, as the
Business was transformed with the very successful, oversubscribed
fund raising and acquisition of Mar City Land Ltd, which completed
on 16 December. This created the platform for significant growth,
with the land acquired providing a springboard for future
expansion, whilst the strengthening of the existing management team
and the Business' processes ensured that Mar City is suitably
structured to scale and deliver further significant growth.
2013 was also a year of development and innovation, in
particular with development of the ground breaking Modern Methods
of Construction modular system of construction, which will play a
significant role in Mar City's future growth and aspiration to
deliver industry leading margins. Of the 7 further contracts signed
in 2013, the Colindale contract in North London was the largest and
will be the first to benefit from this innovative approach, as
construction progresses in 2014.
Aligned to the transformation into an independent housebuilder,
the Business also successfully registered 950 units under the
Government's Help To Buy scheme across a number of its current
developments. Clearly this scheme has brought beneficial results to
the sector and we believe Mar City are well placed to benefit as it
continues to do so, allowing first time buyers, young professionals
and families to enter into home ownership. Indeed, Mar City is
already experiencing high levels of interest in its open market
sales developments, which are translating into high levels of
reservations and private sales completions in 2014, whilst sales
opportunities with HA's and RSL's also remain buoyant.
Key performance indicators
The Directors consider that the key performance indicator
('KPI') of the Group over the longer term will be the total return
to shareholders. Financial KPIs currently used by the Board are
revenue, operating profits, profit before tax and net assets which
are disclosed in the Chairman's Statement.
2013 2012 Movement
GBP000 GBP000
------------------------------ -------- -------- ---------
Revenue 24,823 8,970 + 177%
Underlying operating profit* 3,555 1,019 +249%
Profit before taxation 3,221 978 +229%
Net assets 65,709 1,319 +4882%
Basic EPS ** 6.46p 3.89p +66%
*Operating profit before exceptional GBP211k costs
** Following 1 for 10 share consolidation
Non-financial KPIs related to the number of contracts in
progress, headcount and Health & Safety. The Group
significantly increased the number of contracts and headcount in
the year and had only 1 reportable accident.
Market conditions
The Group has benefited significantly from continued strength in
the UK housing market. Improving consumer confidence, stimulated by
new government backed schemes and increasing employment levels, has
meant Mar City is experiencing exceptional levels of demand. In
particular, the Government's 'Help to Buy' scheme has brought
forward significantly improved results to the housebuilding sector
and we believe it will continue to do so.
An increasing supply of new and affordable homes is essential in
order to address the chronic shortage of homes across the UK. Mar
City is well equipped to help tackle this issue and remains focused
on delivering quality homes to the segment of the market where
demand is highest. Over the years, Mar City has built a strong
reputation with Housing Associations and other affordable housing
providers for delivering projects which meet their high
standards.
Strategic objectives
Our goal is to run Mar City in a prudent and sustainable manner,
minimising financial risk and creating quality homes, in vibrant
local communities. Excellent progress has been made in 2013 in
establishing the Company in London and the South East, along with
the well-established markets in the West and East Midlands.
With a strong balance sheet, cash and debt facilities, we are
well positioned to secure additional sites in the coming year. It
is our intention to remain highly selective in all future land
acquisitions, ensuring we are purchasing the right sites, in the
right locations, off market, at the right price. Following the fund
raise we have acquired a significant number of further plots across
London and the Midlands and will continue to build our land bank
this year. We have a strong pipeline and are seeking to acquire at
least 2,000 plots this year, which would create a land bank of at
least 3 years, by the end of the current year.
Going forward, we believe we can deliver strong returns to
investors and the objective is to successfully develop the land
already acquired and to increase the land bank considerably by the
end of 2014, with the added intent of implementing a progressive
dividend policy in the second half of 2014.
Outlook
There remains an enormous shortage of housing in the UK,
particularly in the affordable to mid- market sectors - your
Group's chosen area of concentration. These shortages are very
evident in the Midlands and London and the South East of England -
the Group's core geographical areas of operation. The demand for
Mar City houses is extremely encouraging and has, of course, been
significantly helped by Government initiatives such as the recently
extended 'Help to Buy' scheme.
We are also seeing a good number of attractive land acquisition
opportunities at prices which meet our strict and uncompromising
financial criteria. Since the fund raise we have acquired 622
further plots across London and the Midlands and will continue to
build our land bank this year
The success of the Group is not only dependent on our ability to
build modern, attractive and sustainable houses and apartments that
meet our customers' rightly demanding expectations, but also to
maintain and develop a financially viable land bank for the future.
With these clear targets in mind and with the resources now
available to the Group, we look forward to the future with
considerable confidence.
ON BEHALF OF THE BOARD
Tony Ryan, Chief Executive
24 March 2014
Consolidated statement of comprehensive income
For the year ended 31 December 2013
Note 2013 2012
GBP000 GBP000
------------------------------------------- ----- --------- -----------
Revenue 24,823 8,970
Cost of sales (18,927) (6,497)
------------------------------------------- ----- --------- -----------
Gross profit 5,896 2,473
Administrative expenses (2,341) (1,454)
------------------------------------------- ----- --------- -----------
Profit from operations before exceptional
costs 3,555 1,019
Exceptional costs 3 (211) -
------------------------------------------- ----- --------- -----------
Profit from operations 3,344 1,019
------------------------------------------- ----- --------- -----------
Finance charges (123) (41)
------------------------------------------- ----- --------- -----------
Profit on ordinary activities before
taxation 3,221 978
Income tax 4 (797) -
------------------------------------------- ----- --------- -----------
Profit on ordinary activities after
taxation 2,424 978
Other comprehensive income - -
------------------------------------------- ----- --------- -----------
Total comprehensive income attributable
to owners 2,424 978
------------------------------------------- ----- --------- -----------
Total and continuing earnings per share
Re-stated*
------------------------------------------- ----- --------- -----------
Basic 5 6.46p 3.89p
------------------------------------------- ----- --------- -----------
Diluted 5 6.46p 3.89p
------------------------------------------- ----- --------- -----------
* see note 5.
All of the Group's operations are continuing.
Consolidated statement of changes in equity
For the year ended 31 December 2013
Share premium Merger relief
Share capital account GBP000 Other reserve reserve GBP000 Retained Total equity
Group GBP000 GBP000 earnings GBP000
GBP000
As at 1 January
2012 627 1,672 363 - (2,449) 213
Issue of shares 71 57 - - - 128
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Transactions
with owners 71 57 - - - 128
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Profit for the
year and total
comprehensive
income - - - - 978 978
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Transfers - - (363) - 363 -
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
As at 31
December 2012 698 1,729 - - (1,108) 1,319
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Issue of shares 2,059 1,532 - 60,171 - 63,762
Issue costs - (64) (1,732) - - (1,796)
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Transactions
with owners 2,059 1,468 (1,732) 60,171 - 61,966
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Profit for the
year and total
comprehensive
income - - - - 2,424 2,424
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
As at 31
December 2013 2,757 3,197 (1,732) 60,171 1,316 65,709
---------------- --------------- --------------- --------------- --------------- --------------- ---------------
Consolidated statement of financial position
As at 31 December 2013 Group
Note 2013 2012
GBP000 GBP000
--------------------------------- ----- -------- --------
Non-current assets
Intangible assets 728 745
Plant, property and equipment 67 24
Trade and other receivables 6,984 -
Current assets
Inventories 7 42,872 347
Trade and other receivables 18,561 1,689
Cash and cash equivalents 27,273 1,178
--------------------------------- ----- -------- --------
Total assets 96,485 3,983
--------------------------------- ----- -------- --------
Current liabilities
Trade and other payables 13,482 1,401
Non-current liabilities
HCA GBB funding 6,984 -
Amounts due under hire purchase - 38
Borrowings 10,310 1,225
--------------------------------- ----- -------- --------
Total liabilities 30,776 2,664
--------------------------------- ----- -------- --------
Equity
Called up share capital 8 2,757 698
Merger relief reserve 60,171 -
Other reserve (1,732) -
Share premium 3,197 1,729
Retained earnings 1,316 (1,108)
--------------------------------- ----- -------- --------
Total equity 65,709 1,319
--------------------------------- ----- -------- --------
Total liabilities and equity 96,485 3,983
--------------------------------- ----- -------- --------
The accompanying principal accounting policies and notes form an
integral part of this financial information.
Consolidated statements of cash flows
For the year ended 31 December 2013 Group
2013 2012
GBP000 GBP000
------------------------------------------------------ --------- --------
Cash flows from operating activities
Profit / (loss) before taxation and finance charges 3,344 978
Amortisation and depreciation 57 11
Increase in trade and other receivables (14,935) (1,463)
Increase in trade and other payables 9,733 1,080
Increase in inventories (1,134) (347)
------------------------------------------------------ --------- --------
Net cash (outflow)/ inflow from operating activities (2,935) 259
------------------------------------------------------ --------- --------
Cash flows from investing activities
Acquisition of subsidiary (5,000) -
Payments to acquire tangible assets (83) (25)
Payments to acquire intangible assets - (45)
Net cash flow from investing activities (5,083) (70)
Cash flows from financing activities
New loans - 1,000
Finance charge (123) (6)
Issue of share capital 34,236 -
Repayment of finance lease principal - (11)
------------------------------------------------------ --------- --------
Net cash flow from financing activities 34,113 983
------------------------------------------------------ --------- --------
Net increase in cash and cash equivalents 26,095 1,172
Cash and cash equivalents at beginning of year 1,178 6
------------------------------------------------------ --------- --------
Cash and cash equivalents at end of year 27,273 1,178
------------------------------------------------------ --------- --------
Notes to the financial information
For the year ended 31 December 2013
1. Principal Accounting Policies
Basis of preparation
The financial statements have been prepared under the historical
cost convention and in accordance with International Financial
Reporting Standards adopted by the European Union (IFRSs). The
Company's shares are traded on the AIM market of the London Stock
Exchange.
The principal accounting policies are set out below and are
consistent with those applied in the 2012 financial statements,
except as follows:
The Group has adopted the new provisions of the following
amended standards but there is no impact on the amounts reported or
the disclosures in the financial statements:
-- IAS 1 (amended 2011) Presentation of Financial Statements
-- IAS 12 (amended 2010) Income Taxes
The Group has also adopted the following standard:
-- IFRS 13 Fair Value Measurement (effective 1 January 2013)
IFRS 13 clarifies the definition of fair value and provides
related guidance and enhanced disclosures about fair value
measurements. It does not affect which items are required to be
fair-valued. The scope of IFRS 13 is broad and it applies for both
financial and non-financial items for which other IFRS require or
permit fair value measurements or disclosures about fair value
measurements except in certain circumstances.
IFRS 13 applies prospectively for annual periods beginning on or
after 1 January 2013. Its disclosure requirements need not be
applied to comparative information in the first year of adoption.
The Group has applied IFRS 13 for the first time in the current
year.
Going concern
At 31 December 2013 the Group had cash resources available of
GBP27.27m and debt with HSBC Bank PLC of GBP10.31m, equating to a
net cash position of GBP16.96m.
The Directors have given full consideration to the cash flow
forecasts of the Group extending to December 2016 (which are
updated on a monthly basis), and the timing of the residential
house building projects which the Group expects to undertake during
the coming financial year which are further detailed in the
Chairman's Statement. After completing this review, the Directors
believe it remains appropriate to prepare the financial statements
on a going concern basis.
2. Segmental Information
2013 2012
GBP000 GBP000
---------------------------- --------- --------
Revenue 24,823 8,970
Cost of sales (18,927) (6,497)
Administrative expenses (2,552) (1,454)
---------------------------- --------- --------
Segment operating profit 3,344 1,019
---------------------------- --------- --------
Segment non-current assets 7,779 769
---------------------------- --------- --------
Segment total assets 96,485 3,983
---------------------------- --------- --------
The Group's largest customer accounted for 100% of revenue in
2013 (2012: 100%). All of the above activities occurred in the
Group's country of domicile, the UK.
Revenue for construction contracts in 2013 totals GBP24,761k
(2012: 8,120k).
3. Exceptional costs
The GBP211k of exceptional costs (2012: GBPnil) incurred relates
to professional and other fees incurred from the acquisition of Mar
City Land Ltd on 16 December 2013.
4. Income tax
The tax assessed for the period differs from the standard rate
of corporation tax in the UK as follows:
2013 2012
GBP000 GBP000
-------------------------------------------------------------------------------------- -------- --------
Profit on ordinary activities before taxation 3,221 978
Profit multiplied by standard rate of corporation tax in the UK of 23% (2012: 24.5%) 749 240
Expenses not deductible for tax purposes 50 7
Differences between capital allowances and depreciation (9) -
Other adjustments 7 -
Utilisation of brought forward losses - (284)
Losses carried forward - 37
Tax charge for the period 797 -
-------------------------------------------------------------------------------------- -------- --------
The Group has unrelieved tax losses of GBP981k (2012: GBP1,025k)
remaining available to offset against future taxable trading
profits in the company. The associated deferred tax asset of
GBP226k (2012: GBP236k) has not been recognised due to the
uncertainty over the timing and utilisation of such losses against
future profits.
5. Earnings per share
The calculation of the basic continuing earnings per share is
based on the profit on ordinary activities after tax of GBP2,424k
(2012: GBP978k) divided by the weighted average number of ordinary
shares in issue during the year of 37,551,905 (2012 restated:
25,143,792). The comparative number has been restated to reflect
the consolidation of shares during the year in order to make the
data comparable.
The share options in issue are considered anti-dilutive as the
exercise price is greater than the average share price during the
year ended 31 December 2013 (2012: none).
6. Acquisition of Mar City Land Ltd and placing of new equity
On 16 December 2013, the Company acquired the entire issued
share capital of Mar City Land Ltd for an aggregate consideration
of GBP30.8m. In order to finance the acquisition the Company placed
additional shares. The aggregate consideration payable by the
Company was satisfied as to GBP25.8m by the issue of 322,148,763
new ordinary shares credited as fully paid at the placing price of
8p per share and GBP5m in cash.
This acquisition was in line with the Group's strategy and
completed the transformation of the Group from a contractor into an
independent house builder, with its own land bank and associated
work in progress.
The aggregate consideration was GBP30.8m and the net assets of
the company acquired comprised land, work-in-progress, and bank and
other debt as detailed below.
GBPm
Land value 30.8
WIP 10.3
Debt (10.3)
Total net assets acquired 30.8
Total net consideration 30.8
Goodwill -
All of the assets and liabilities were acquired by Mar City Land
Ltd from Mar City Developments Ltd, prior to the acquisition of the
shares of Mar City Land Ltd by Mar City PLC.
The acquisition of the shares and the assignment of the debt
incurred exceptional costs of GBP211k.
No goodwill or other intangible assets arose as a result of the
transaction.
The land was independently valued by GA Europe Valuations Ltd, a
subsidiary of the Great American Group Inc and subsequently
independently overviewed by CBRE. The work-in-progress was also
independently valued.
7. Inventories
Group Company
2013 2012 2013 2012
GBP000 GBP000 GBP000 GBP000
------------------ -------- -------- -------- --------
Land 31,216 - 137 -
Work In Progress 11,656 347 - -
At 31 December 42,872 347 137 -
------------------ -------- -------- -------- --------
8. Share Capital
2013 2012
GBP000 GBP000
------------------------------------------------------- ------------ ------------
Allotted, issued and fully paid
Ordinary shares of 2.5p 2,757 698
Ordinary shares of 2.5p
2013 2012
Shares issued and fully paid at the end of the period
------------------------------------------------------- ------------ ------------
* ordinary shares of 0.25p - 279,390,834
------------------------------------------------------- ------------ ------------
110,292,925 -
* ordinary shares of 2.5p
------------------------------------------------------- ------------ ------------
The movement on share capital is detailed below. All ordinary
shares have the same rights and there are no restrictions on the
distribution of dividends or repayment of capital.
On 16 December 2013 the Company completed a placing of
322,418,763 new ordinary shares at a price of 8p per share for
GBP25.794m enabling the acquisition of Mar City Land Ltd. The
Company also completed a placing of 437,500,000 new ordinary shares
at a price of 8p per share raising a total of GBP35m, before
expenses. This placing incurred costs of GBP1,732k which have been
taken to reserves. As part of this placing, Director's loans and
accrued interest of GBP1.32m were also converted into 16,476,789
new ordinary shares at a price of 8p.
On 20 May 2013 the Company completed a placing of 47,142,858 new
ordinary shares at a price of 3.5p per share raising a total of
GBP1.6m, before expenses. This placing incurred costs of GBP64k
which have been offset against the share premium account.
These proceeds will allow the Group to fulfil another stated
strategic objective, namely to broaden the Group's geographic area
of operations into London and the South East of England. The
majority of the net proceeds of the Placings will be applied to
purchase land both in the new region of London and the South East
of England as well as the Group's traditional region of the
Midlands.
As part of the reorganisation of the Group's financial affairs,
a share consolidation was also completed on 20 December 2013 on the
basis of one new consolidated share for every ten existing ordinary
shares.
Share reconciliation Number of
shares
At 1 Jan 2013 279,390,834
At 20 May 2013 Placing of new shares 47,142,858
At 16 Dec 2013 Placing and issue of new shares for acquisition 776,395,552
--------------
At 16 Dec 2013 Balance pre consolidation 1,102,929,254
--------------
At 31 Dec 2013 Post consolidation 110,292,925
--------------
9. Related party transactions
The Group has earned revenue from MCDL, a related party under
the common control of Maggie Ryan and Tony Ryan of GBP24.82m (2012:
GBP8.12m) in relation to contract work performed. The Group carries
out work with MCDL under a Business Co-operation Agreement, which
sets out work to be carried out and invoiced under design and build
agreements.
The Group had net debtor balances of GBP12.30m (2012: GBP1.22m)
owing from MCDL at 31 December 2013. This is supported by a signed
agreement to repay the debtor in 2014, based mainly upon the
completion of the Colindale development contract, which Mar City
Homes Ltd is currently building under a JCT contract.
The GBB Funding liability acquired with Mar City Land Ltd of
GBP8.93m is also supported by a signed agreement for MCDL to repay
the amounts, as and when they fall due to the HCA.
A further GBP59,760 of revenue was earned from MCDL in relation
to the employees' time and other administration costs (2012:
GBP845,000) during the year.
GBP250,142 has been charged to this group by MCDL in relation to
administration overheads (2012: GBP280,000), including rental costs
of GBP164,379 (2012: GBP90,000), whilst supplier costs of GBP1,929k
relating to contracts were recharged by MCDL (2012: GBPnil).
Maggie Ryan and Tony Ryan were granted share options during the
year.
During the year the Group acquired the share capital of Mar City
Land Ltd, a company jointly owned by Maggie Ryan and Tony Ryan.
10. Ultimate controlling party
The Group's ultimate controlling parties are collectively Mrs
Maggie Ryan, Mr Tony Ryan and Mr Hamilton Anstead by virtue of
their shareholdings as detailed in the Report of the Directors.
11. Preliminary Announcement
The financial information set out in this preliminary
announcement does not constitute statutory accounts as defined in
section 434 of the Companies Act 2006. The consolidated statement
of financial position at 31 December 2013 and the consolidated
statement of comprehensive income, the consolidated statement of
changes in equity, the consolidated statement of cash flows and the
associated notes for the year then ended have been extracted from
the Group's financial statements upon which the auditor's opinion
is unqualified and does not include any statement under section 498
of the Companies Act 2006. The statutory accounts for the year
ended 31 December 2013 will be delivered to the Registrar of
Companies following the Group's Annual General Meeting.
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
END
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