Date: | 23 November 2023 |
On behalf of: | First Property Group plc ("First Property" or the "Group" or the "Company") |
Embargoed: | 0700hrs |
First Property Group plc
Interim results for the six months to 30 September 2023
First Property Group plc (AIM: FPO), the award-winning property fund manager and investor with operations in the United Kingdom and Central Europe, today announces its interim results for the six months ended 30 September 2023.
Highlights:
· Statutory loss before tax: £0.65 million (30 September 2022 profit before tax: £2.39 million)
· Cash: £6.71 million (31 March 2023: £7.65 million)
· Net debt: £22.22 million (31 March 2023: £22.01 million)
· Third party Assets Under Management ("AUM"): £304 million (31 March 2023: £400 million)
· Total AUM: £358 million (31 March 2023: £454 million)
· Weighted average unexpired fund management contract term at 30 September 2023: 2 years, 1 month (31 March 2023: 2 years, 9 months)
Financial summary:
| Unaudited six months to 30 Sep 2023 | Unaudited six months to 30 Sep 2022 | Percentage change | Audited year to 31 Mar 2023 | |
Income Statement: | | | | | |
Statutory (loss)/ profit before tax | (£0.65m) | £2.39m | -127.2% | £2.49m | |
Diluted (loss)/ profit earnings per share | (0.99p) | 1.83p | -154.1% | 1.70p | |
Total dividend per share | 0.00p | 0.25p | -100% | 0.50p | |
Average ?/ £ rate | 1.1590 | 1.1698 | - | 1.1567 | |
|
| | | | |
| Unaudited six months to 30 Sep 2023 | Audited year to 31 Mar 2023 | Percentage change | Unaudited six months to 30 Sep 2022 (restated) | |
Balance Sheet at period end: |
| | | | |
Investment properties at book value | £47.13m | £47.01m | +0.3% | £42.56m | |
Investment properties at market value | £53.28m | £53.97m | -1.3% | £48.67m | |
|
| | | | |
Associates and investments at book value | £20.03m | £22.13m | -9.5% | £25.33m | |
Associates and investments at market value | £22.30m | £25.27m | -11.8% | £29.83m | |
|
| | | | |
Cash balances | £6.71m | £7.65m | -12.3% | £5.98m | |
Cash per share | 6.05p | 6.90p | -12.3% | 5.39p | |
Gross debt* | £28.93m | £29.66m | -2.5% | £29.53m | |
Net debt* | £22.22m | £22.01m | +1.0% | £23.55m | |
|
| | | | |
Gearing ratio at book value** | 41.0% | 40.6% | - | 40.5% | |
Gearing ratio at market value*** | 37.0% | 36.1% | - | 35.7% | |
|
| | | | |
Net assets at book value | £41.65m | £43.44m | -4.1% | £43.47m | |
Net assets at market value | £49.22m | £52.54m | -6.3% | £53.25m | |
Adjusted net assets per share (EPRA basis) | 43.56p | 46.50p | -6.3% | 47.12p | |
|
| | | | |
Period end ?/ £ rate | 1.1528 | 1.1381 | - | 1.1395 | |
|
| | | | |
*Debt comprises financial liabilities and other financial liabilities including those of 5th Property Trading Limited ("5PT"). ** Gearing ratio = Gross debt divided by Gross assets. *** Attributable to the owners of the parent, excludes non-controlling interest. |
| ||||
Commenting on the results, Ben Habib, Chief Executive of First Property, said:
"Markets have been as challenging over the last year as I have ever known them. The rapid increase in interest rates, with a commensurate collapse in demand for commercial property, both occupationally and for investment, had created a perfect storm. For fifteen years interest rates had been near zero and global markets supported by borrowings in dollars with investment in developing countries and more "risky" assets - the so called carry trade.
"With the Federal Reserve aggressively increasing interest rates, that carry trade has reversed equally aggressively with capital flooding back to the United States.
"So, whilst it is disappointing to report a loss, this was created by a mark down in property values and not as a result of a deterioration in trading. The Group is robust.
"Inflation is now reducing, and interest rates are likely to be close to their peak. They have already been reduced in Poland.
"Markets are steadying and we are seeing an uptick in investment demand, though it is too early to be certain.
"We also have occupational demand for the vacant space in the office blocks we own in Warsaw and Gdynia, with particular demand for the former. As we lease up this space, we will start again to generate good levels of cash, as we have historically done.
"In the meantime, our cash balance is good, with over £6 million on the balance sheet, giving us the firepower we need to fitout the space as it is leased.
"We are also seeing some interesting lending propositions for our new debt division. We have yet to make a loan but our market knowhow and the number of deals we are considering has considerably increased.
"I am once again beginning to be excited about the future."
Investor presentation:
A briefing for analysts and investors will be held at 11.00hrs today via Investor Meet Company. To participate it is necessary to register at https://www.investormeetcompany.com/first-property-group-plc/register-investor and select to meet the Company. Those who have already registered and selected to meet the Company will be automatically invited. A copy of the accompanying investor presentation and a recording of the call will be posted on the Group's website.
For further information please contact:
First Property Group plc | Tel: +44 (20) 7340 0270 |
Ben Habib (Chief Executive Officer) Laura James (Group Finance Director) Jeremy Barkes (Director, Business Development) | |
Jill Aubrey (Director, Compliance & Company Secretary)
|
|
Allenby Capital (NOMAD & Broker) | Tel: + 44 (0) 20 3328 5656 |
Nick Naylor / Daniel Dearden-Williams (Corporate Finance) Amrit Nahal / Tony Quirke (Sales and Corporate Broking) | |
Notes to Investors and Editors:
First Property Group plc is an award-winning property fund manager and investor with operations in the United Kingdom and Central Europe. Its focus is on higher yielding commercial property with sustainable cash flows. The Company is flexible and takes an active approach to asset management. Its earnings are derived from:
· Fund Management - via its FCA regulated and AIFMD approved subsidiary, First Property Asset Management Ltd ("FPAM"), which earns fees from investing for third parties in property. FPAM currently manages twelve funds which are invested across the United Kingdom, Poland and Romania.
· Group Properties - principal investments by the Group, to earn a return on its own capital, usually in partnership with third parties. Investments include six directly held properties in Poland and one in Romania, and non-controlling interests in nine of the twelve funds managed by FPAM.
Quoted on AIM, First Property has offices in London and Warsaw. Around one third of the shares in First Property are owned by directors, management and their families. Further information about the Group and its properties can be found at: www.fprop.com.
CHIEF EXECUTIVE'S STATEMENT
Performance:
I am pleased to report interim results for the six months ended 30 September 2023.
Revenue earned by the Group was £3.97 million (30 September 2022: £4.19 million) yielding a loss before tax of £0.65 million (30 September 2022 profit before tax: £2.39 million). The loss was caused by a reduction of £0.82 million in the fair value of the Group's investment in one of its associates, Fprop Opportunities plc ("FOP"). Otherwise, the Group has been trading in line with market expectations.
The rapid increase in interest rates and consequent flight of capital from our markets has materially impacted property values. The Group has been shielded from much of this by its accounting policy of holding properties at the lower of cost or value. However, the cost of the Group's share in FOP, which is invested in five commercial properties in Poland, was rebased in October 2018 when the Group's share in it reduced below 50%, resulting in it being deconsolidated from the accounts of the Group and recognised as an associate at the then prevailing property values. In the six months to 30 September 2023 the five properties owned by FOP decreased in value by £2.2 million, of which the Group's share amounted to £0.82 million.
Diluted loss per share amounted to 0.99 pence (30 September 2022 earnings per share: 1.83 pence).
The Group ended the period with net assets calculated under the cost basis of accounting of £41.65 million (31 March 2023: £43.44 million), equating to 37.56 pence per share (31 March 2023: 39.18 pence per share). The net assets of the Group with property values adjusted to their market value less any deferred tax liabilities (EPRA basis) was £49.22 million, or 43.56 pence per share (31 March 2023: £52.54 million, or 46.50 pence per share). The market values of Group properties are independently assessed once a year, on 31 March, except for the five properties held by FOP which are also assessed as at 30 September.
Gross debt at the period end amounted to £28.93 million (31 March 2023: £29.66 million), which was secured against six commercial properties in Poland and one in Romania. Of this, £16.95 million was non-interest bearing and represents deferred consideration payable for the purchase of two properties in Poland.
The Group's gearing ratio, calculated with its seven directly owned properties at book value, was 40.99% (31 March 2023: 40.57%). Using market values for these properties the gearing ratio was 37.02% (31 March 2023: 36.08%).
The Group's seven directly owned properties are held in separate non-recourse special purpose vehicles without any cross collateralisation of the debt or Group guarantees.
Group cash balances at the period end stood at £6.71 million (31 March 2023: £7.65 million), equivalent to 6.05 pence per share (31 March 2023: 6.90 pence per share).
Dividend:
The Directors have resolved not to pay a dividend (30 September 2022: 0.25 pence per share) until the Group returns to profitability. Our cash balances are good and it is important we preserve this until we emerge from these turbulent times.
REVIEW OF OPERATIONS
PROPERTY FUND MANAGEMENT ("First Property Asset Management Ltd" or "FPAM")
Third party assets under management at the period end decreased by 24% to £304.6 million (31 March 2023: £400.4 million). The decrease was attributable mainly to the decrease in value of properties held in third party managed funds of £87.1 million.
The large decrease in value of third-party funds was mainly related to the write down in value of properties held by Fprop Offices LP ("Fprop Offices") and Fprop Phoenix Ltd ("Fprop Phoenix"), which experienced write downs of £28.8 million and £47.0 million, respectively. We do not earn a fixed fee from Fprop Offices, and the reduction in value of the fund does not reduce our recurring fee income. Fprop Offices is due to be wound up next year.
63.3% of third-party assets under management were located in the UK, 33.9% in Poland and 2.8% in Romania.
Revenue earned by this division decreased to £1.26 million (30 September 2022: £1.66 million), resulting in profit before unallocated central overheads and tax decreasing to £0.16 million (30 September 2022: £0.52 million).
At the period end fund management fee income, excluding performance fees, was being earned at an annualised rate of £2.06 million (31 March 2023: £2.55 million).
FPAM's weighted average unexpired fund management contract term at the period-end was 2 years, 1 month (31 March 2023: 2 years, 9 months).
The reconciliation of movement in third party funds under management during the period is shown below:
| Funds managed for third parties (including funds in which the Group is a minority shareholder) | |||
| UK £m. | CEE £m. | Total £m. | No. of prop's |
As at 1 Apr 2023 | 241.4 | 159.0 | 400.4 | 53 |
Property purchases | - | - | - | - |
Property sales | (6.7) | - | (6.7) | (2) |
Capital expenditure | - | - | - | - |
Property revaluation | (41.9) | (45.2) | (87.1) | - |
FX revaluation | - | (2.0) | (2.0) | - |
As at 30 Sep 2023 | 192.8 | 111.8 | 304.6 | 51 |
An overview of the value and maturity of each of the funds managed by FPAM is set out below:
Fund | Country of investment | Fund expiry | Assets under management at market value at 30 Sep 2023 | No of properties | % of total third-party assets under management | Assets under management at market value at 31 Mar 2023 |
|
| £m. |
| % | £m. | |
SAM & DHOW | UK | Rolling | * | * | * | * |
OFFICES | UK | Jun 2024 | 53.0 | 4 | 17.4 | 84.9 |
SIPS | UK | Jan 2025 | 96.8 | 21 | 31.8 | 104.7 |
FOP | Poland | Oct 2025 | 61.6 | 5 | 20.2 | 64.5 |
FGC | Poland | Mar 2026 | 21.7 | 1 | 7.1 | 22.0 |
UKPPP | UK | Jan 2027 | 20.5 | 8 | 6.7 | 28.1 |
SPEC OPPS | UK | Jan 2027 | 14.4 | 4 | 4.7 | 14.9 |
FKR | Poland | Mar 2027 | 16.5 | 1 | 5.4 | 16.8 |
FCL | Romania | Jun 2028 | 8.6 | 1 | 2.8 | 8.7 |
FPL | Poland | Jun 2028 | 3.4 | 4 | 1.2 | 47.0 |
FUL | UK | Indefinite | 8.1 | 2 | 2.7 | 8.8 |
Total Third Party AUM |
| 304.6 | 51 | 100.0 | 400.4 |
* Not subject to recent revaluation.
The sub sector weightings of investments in FPAM funds is set out in the table below:
| UK | Poland | Romania | Total | % of Total |
| £m. | £m. | £m. | £m. |
|
Offices | 109.3 | 41.5 | 8.6 | 159.4 | 52.3 |
Retail warehousing | 56.9 | - | - | 56.9 | 18.7 |
Shopping centres | - | 49.7 | - | 49.7 | 16.3 |
Supermarkets | 26.6 | 12.0 | - | 38.6 | 12.7 |
Total | 192.8 | 103.2 | 8.6 | 304.6 | 100.0 |
% of Total | 63.3 | 33.9 | 2.8 | 100.0 |
|
GROUP PROPERTIES DIVISION
At the period end the Group Properties division comprised seven directly owned commercial properties in Poland and Romania valued at £53.28 million (31 March 2023: £53.97 million), and interests in nine of the twelve funds managed by FPAM (classified as Associates and Investments) valued at £22.30 million (31 March 2023: £25.27 million).
The contribution to Group profit before tax and unallocated central overheads from this division was £0.09 million (30 September 2022: £2.40 million), of which the seven directly owned properties contributed £0.27 million (30 September 2022: £0.98 million) and the Associates and Investments contributed a loss of £0.18 million (30 September 2022 profit: £1.42 million).
The reduced contribution from the Associates and Investments was mainly due to the write down by £0.82 million in value of the Group's share in FOP. In addition, distributions in respect of the Group's 11.1% share in Fprop UK Special Opportunities LP ("SPEC OPPS") of £0.08 million were less than the contribution in the same period last year of £1.20 million. Last year's higher contribution was driven by property sales.
Nearly one third of the vacant office space in the Group's directly held office properties in Gdynia and Warsaw (Blue Tower), which it acquired in 2021 and 2022 respectively and which totalled some 20,000 square metres, has been leased. Net operating income should improve by some ?2 million per annum once this vacant space is fully let. Tenant demand remains steady in both cities.
1. Directly owned properties (all accounted for under the cost model):
The book value of the Group's seven directly owned properties was £47.13 million. Their market value, as at 30 September 2023, was £53.28 million.
Country | Sector | Property/ fund name | No. of properties as at 30 Sep 2023 | Book value as at 30 Sep 2023 | Market value as at 30 Sep 2023 | *Contribution to Group profit before tax - period to | *Contribution to Group profit before tax - period to |
|
|
|
| £m. | £m. | £m. | £m. |
Poland | Offices | Gdynia | 1 | 14.20 | 14.32 | (0.14) | (0.21) |
Poland, | Offices | Blue Tower | 1 | 20.71 | 23.89 | 0.46 | 0.64 |
Poland | Supermarkets | Praga | 1 | 1.96 | 2.91 | 0.05 | 0.20 |
Romania | Office | Dr Felix | 1 | 2.32 | 3.82 | 0.05 | 0.02 |
Poland Multi-let | 5PT | 3 | 7.94 | 8.34 | 0.18 | ** | |
Total* | | 7 | 47.13 | 53.28 | 0.60 | 0.65 | |
Profit on the sale of investment properties | | | - | 1.06 | |||
Other overhead costs allocated to the direct property division | | | (0.33) | (0.73) | |||
Total contributions to PBT from Group Properties |
|
| 0.27 | 0.98 |
*Prior to the deduction of unallocated central overhead expenses.
**5PT, a fund in which the Group gained a controlling interest in financial year ended 31 March 2023 (previously recognised as an associate).
The debt secured against these seven properties amounted to £28.93 million (31 March 2023: £29.66 million), including deferred consideration of £16.95 million (31 March 2023: £17.02 million) which is non-interest bearing.
Interest costs on the £11.99 million of interest-bearing debt amounted to £0.38 million in the period (30 September 2022: £0.19 million). This equates to an average borrowing cost of 2.6% per annum when expressed as a percentage of total Group debt, or 6.3% if the non-interest-bearing element is excluded. A one percentage point increase in interest rates would impact the cost of the floating rate loans and would increase the Group's annual interest bill by some £120,000 per annum (31 March 2023: £127,000).
All five bank loans are held in separate non-recourse special purpose vehicles and are not guaranteed by the Group.
Directly owned Properties | 30 Sep 2023 | 31 Mar 2023 |
Book value | £47.13m | £47.01m |
Market value | £53.28m | £53.97m |
Debt (all non-recourse to the Group) | £28.93m | £29.66m |
LTV at book value % | 61.38% | 63.09% |
LTV at market value % | 54.30% | 54.96% |
Average borrowing cost (including non-interest-bearing loans) | 2.6% | 1.8% |
The Weighted Average Unexpired Lease Term (WAULT) of the seven properties as at 30 September 2023 was 4 years, 3 months (31 March 2023: 3 years, 6 months).
In July the Group acquired for £0.21 million the minority interest (being 23%) in E and S Estates Ltd ("E and S"), a fund managed by the Group, resulting in it owning 100% of the shares in issue. E and S owns a supermarket in Praga, a suburb of Warsaw, valued at ?3.36 million. It contributed some £50,000 in net profit in the six months just ended, a return on net equity of around 7% on an annualised basis.
Associates and Investments ("A&I's")
These comprise non-controlling interests in nine of the twelve funds managed by FPAM, of which five are accounted for as "associates" under the cost model and four are accounted for as "investments in funds" and held at fair value. It is the accounting policy of the Group to carry its interests in associates at the lower of cost or market value.
The contribution from this segment amounted to a loss before tax and unallocated central overheads of £0.18 million (30 September 2022: profit £1.42 million), mainly due to the write down by £0.82 million of the Group's 45.71% share in FOP. At their new value of £61.5 million, the properties held by FOP yield income of some 8.5% per annum, they are 97% leased by net lettable area and the vast majority of rent payable is subject to annual increases linked to inflation.
The book value of the five associates was £17.06 million (31 March 2023: £17.59 million). Their market value was £19.33 million (31 March 2023: £20.73 million).
The value of the four investments in funds reduced to £2.97 million (31 March 2023: £4.54 million). The reduction was mainly due to the decrease in value by £1.0 million of the Group's co-investment in Fprop Offices, an explanation for which is in the section entitled "Fund Management Division".
An overview of the Associates and Investments is set out in the table below:
Fund | Country of investment | % owned by First Property Group | Book value of First Property's share in fund | Current market value of holdings | Group's share of post-tax profits earned by fund 30 Sep 2023 | Group's share of post-tax profits earned by fund 30 Sep 2022 |
|
| % | £'000 | £'000 | £'000 | £'000 |
a) Associates | | | | | | |
5PT | Poland | 47.20 | * | * | * | 59 |
FOP | Poland | 45.71 | 12,305 | 12,305 | 442 | 347 |
FGC | Poland | 29.09 | 2,918 | 3,136 | 92 | 119 |
FKR | Poland | 18.07 | 1,181 | 1,253 | 27 | (2) |
FPL | Poland | 23.38 | - | 1,730 | (60) | (435) |
FCL | Romania | 21.17 | 652 | 901 | 16 | 29 |
Sub Total |
|
| 17,056 | 19,325 | 517 | 117 |
| | | | | | |
b) Investments | | | | | | |
UK PPP | UK | 0.94 | 196 | 196 | 14 | 23 |
SPEC OPPS | UK | 11.06 | 2,142 | 2,142 | 82 | 1,196 |
OFFICES | UK | 1.64 | 461 | 461 | 18 | 74 |
FUL | UK | 2.50 | 174 | 174 | - | 9 |
Sub Total | | | 2,973 | 2,973 | 114 | 1,302 |
Total |
|
| 20,029 | 22,298 | 631 | 1,419 |
*Consolidated into the Group
New Loan Division (secured lending against commercial property):
Since its establishment in June 2023, this division has originated over £600 million in enquiries for new senior loans. It has yet to complete its first loan but we are hopeful of doing so soon.
The division is offering senior loans at a relatively high loan to value of 65% without obliging the borrower to amortise the debt during its term. This enables the properties against which such loans are advanced to support relatively high interest rates of 9% to 10% per annum.
As previously reported, no new employees will, initially, be required to be employed to roll out this product and the Group does not intend to use its own cash to make such loans. It may, however, invest alongside third parties in any fund structures set up to make such loans.
Commercial Property Market Outlook
Poland:
GDP growth contracted by 0.8% per annum in the first half of 2023, resulting in forecasters downgrading their full year GDP growth estimates to 0.2% per annum, the lowest it has been in our entire time investing in that country. GDP growth is expected to rebound in 2024, to 2.8% per annum (previous forecasts were at 2.2% per annum).
Unemployment was at a historic low of 5.0% in August, which, in combination with strong nominal wage increases, is expected to drive economic activity in 2024.
The National Bank of Poland's key policy interest rate was cut in September by 75bp and in October by 25bp and now stands at 5.75% per annum. Inflation has fallen from some 17% year on year to around 4%.
Investment demand for commercial property remains weak but occupational demand remains steady. The development of new property is at a cyclical low.
Rental values in Poland are contractually mostly linked to inflation, which offers some protection from inflation as long as the economy remains buoyant, and tenants can afford to pay their contractual increases.
United Kingdom:
The Bank of England held interest rates at 5.25% per annum in September and again in October, unchanged for the first time in 15 meetings of the Monetary Policy Committee ("MPC"). The Consumer Price Index ("CPI") increased by 4.7% on an annualised basis in October, a rate which is less than half of its peak of 11.1% in October 2022, but still above the 2% target of the Bank of England. Economic growth is close to nil.
The commercial property investment market remains generally weak, in particular for offices and shopping centres. The occupier market is also generally weak, including for industrial property, where strong demand over the last several years has stalled.
Current Trading and Prospects
Markets have been as challenging over the last year as I have ever known them. The rapid increase in interest rates, with a commensurate collapse in demand for commercial property, both occupationally and for investment, had created a perfect storm. For fifteen years interest rates had been near zero and global markets supported by borrowings in dollars with investment in developing countries and more "risky" assets - the so called carry trade.
With the Federal Reserve aggressively increasing interest rates, that carry trade has reversed equally aggressively with capital flooding back to the United States.
So, whilst it is disappointing to report a loss, this was created by a mark down in property values and not as a result of a deterioration in trading. The Group is robust.
Inflation is now reducing, and interest rates are likely to be close to their peak. They have already been reduced in Poland.
Markets are steadying and we are seeing an uptick in investment demand, though it is too early to be certain.
We also have occupational demand for the vacant space in the office blocks we own in Warsaw and Gdynia, with particular demand for the former. As we lease up this space, we will start again to generate good levels of cash, as we have always historically done.
In the meantime, our cash balance is good, with over £6 million on the balance sheet, giving us the firepower we need to fitout the space as it is leased.
We are also seeing some interesting lending propositions for our new debt division. We have yet to make a loan but our market knowhow and the number of deals we are considering has considerably increased.
I am once again beginning to be excited about the future.
Ben Habib
Chief Executive
CONSOLIDATED INCOME STATEMENT
for the six months to 30 September 2023
| Notes | Six months to 30 Sep 2023 (unaudited) | Six months to 30 Sep 2022 (unaudited) | Year to 31 Mar 2023 (audited) |
| | £'000 | £'000 | £'000 |
| |
| | |
Revenue | | 3,966 | 4,188 | 7,249 |
Cost of sales | | (1,763) | (1,697) | (2,257) |
Gross profit |
| 2,203 | 2,491 | 4,992 |
| |
| | |
Profit on sale of investment properties | | - | 1,061 | 1,779 |
Operating expenses | | (2,386) | (2,466) | (4,767) |
Operating (loss)/profit | | (183) | 1,086 | 2,004 |
Share of results in associates | 8a | 517 | 117 | 273 |
Share of associates' revaluation (loss)/gain | 8a | (816) | - | (901) |
Investment income | | 114 | 1,302 | 1,497 |
Interest income | 3 | 95 | 75 | 145 |
Interest expense | 3 | (379) | (188) | (530) |
(Loss)/profit before tax | | (652) | 2,392 | 2,488 |
Tax charge | 4 | (257) | (297) | (449) |
(Loss)/profit for the period | | (909) | 2,095 | 2,039 |
| |
| | |
Attributable to: | |
| | |
Owners of the parent | | (1,122) | 2,065 | 1,919 |
Non-controlling interests | | 213 | 30 | 120 |
| | (909) | 2,095 | 2,039 |
| | | | |
(Loss)/Earnings per share | | | | |
Basic | 5 | (1.01p) | 1.86p | 1.73p |
Diluted | 5 | (0.99p) | 1.83p | 1.70p |
All operations are continuing.
CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
for the six months to 30 September 2023
| Notes | Six months to 30 Sep 2023 | Six months to 30 Sep 2022 | Year to 31 Mar 2023 |
| | (unaudited) | (unaudited) | (audited) |
| | £'000 | £'000 | £'000 |
| |
| | |
(Loss)/ profit for the period | | (909) | 2,095 | 2,039 |
| |
| | |
Other comprehensive income | |
| | |
Items that may subsequently be reclassified to profit or loss: | |
| | |
Exchange differences on retranslation of foreign subsidiaries | | 91 | (86) | 944 |
Net (loss) on financial assets at fair value through Other Comprehensive Income | 8b | (1,137) | (1,047) | (1,412) |
Taxation | | - | - | - |
Total comprehensive income for the period | | (1,955) | 962 | 1,571 |
| |
| | |
Total comprehensive income for the period attributable to: | |
| | |
Owners of the parent | | (2,110) | 923 | 1,324 |
Non-controlling interests | | 155 | 39 | 247 |
| | (1,955) | 962 | 1,571 |
All operations are continuing.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 September 2023
| Notes | As at 30 Sep 2023 (unaudited)
| As at 31 Mar 2023 (audited) | As at 30 Sep 2022 (unaudited) (restated) |
| | £'000 | £'000 | £'000 |
| |
| | |
Non-current assets | |
| | |
Investment properties | 6 | 47,134 | 47,009 | 22,839 |
Right of use Asset | | 647 | 197 | 790 |
Property, plant and equipment | | 67 | 80 | 106 |
Investment in associates | 8a | 17,056 | 17,588 | 19,834 |
Other financial assets at fair value through OCI | 8b | 2,973 | 4,544 | 5,493 |
Goodwill | | 153 | 153 | 153 |
Deferred tax assets | | 970 | 930 | 913 |
Total non-current assets |
| 69,000 | 70,501 | 50,128 |
| |
| | |
Current assets | |
| | |
Inventories - land and buildings | 7 | - | - | 19,722 |
Current tax assets | | 113 | 79 | 7 |
Right of use assets | | 457 | 457 | 444 |
Trade and other receivables | 9 | 5,354 | 3,729 | 6,113 |
Cash and cash equivalents | | 6,707 | 7,647 | 5,977 |
Total current assets | | 12,631 | 11,912 | 32,263 |
| |
| | |
Current liabilities | |
| | |
Trade and other payables | 10 | (4,713) | (3,310) | (4,486) |
Provisions | 11 | (113) | (158) | (773) |
Lease liabilities | | (469) | (469) | (408) |
Financial liabilities | 12 | (1,067) | (1,116) | (5,648) |
Other financial liabilities | 13 | (12,286) | (939) | (907) |
Current tax liabilities | | (41) | (28) | (93) |
Total current liabilities | | (18,689) | (6,020) | (12,315) |
Net current assets | | (6,058) | 5,892 | 19,948 |
Total assets less current liabilities | | 62,942 | 76,393 | 70,076 |
| | | | |
Non-current liabilities | | | | |
Financial liabilities | 12 | (10,921) | (11,519) | (7,114) |
Other financial liabilities | 13 | (4,660) | (16,082) | (15,863) |
Lease liabilities | | (658) | (267) | (890) |
Deferred tax liabilities | | (3,203) | (3,050) | (2,509) |
Net assets | | 43,500 | 45,475 | 43,700 |
| |
| | |
Equity | |
| | |
Called up share capital | | 1,166 | 1,166 | 1,166 |
Share premium | | 5,635 | 5,635 | 5,635 |
Share-based payment reserve | | 497 | 179 | 179 |
Foreign exchange translation reserve | | (2,204) | (2,353) | (3,392) |
Purchase of own shares reserve | | (2,440) | (2,440) | (2,440) |
Investment revaluation reserve | | (1,865) | (728) | (363) |
Retained earnings | | 40,861 | 41,983 | 42,683 |
Equity attributable to the owners of the parent | | 41,650 | 43,442 | 43,468 |
Non-controlling interests | | 1,850 | 2,033 | 232 |
Total equity | | 43,500 | 45,475 | 43,700 |
| |
| | |
Net assets per share | 5 | 37.56p | 39.18p | 39.20p |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months to 30 September 2023
| Share Capital | Share Premium
| Share- Based Payment Reserve | Foreign Exchange Translation Reserve | Purchase of Own Shares | Investment Revaluation Reserve
| Retained Earnings
| Non-Controlling Interests
| Total |
Restated | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 |
At 1 Apr 2022 | 1,166 | 5,791 | 179 | (3,297) | (2,653) | 684 | 40,895 | 229 | 42,994 |
Profit for the period | - | - | - | - | - | - | 2,095 | - | 2,095 |
Net (loss) on financial assets at fair value through other comprehensive income | - | - | - | - | - | (1,047) | - | - | (1,047) |
Movement on foreign exchange | - | - | - | (95) | - | - | - | 9 | (86) |
Total Comprehensive Income | - | - | - | (95) | - | (1,047) | 2,095 | 9 | 962 |
Sale of treasury shares | - | (156) | - | - | 213 | - | - | - | 57 |
Non-controlling interests | - | - | - | - | - | - | (30) | 30 | - |
Dividends paid | - | - | - | - | - | - | (277) | (36) | (313) |
At 30 Sep 2022 | 1,166 | 5,635 | 179 | (3,392) | (2,440) | (363) | 42,683 | 232 | 43,700 |
Profit for the period | - | - | - | - | - | - | (56) | - | (56) |
Net gain/ (loss) on financial assets at fair value through other comprehensive income | - | - | - | - | - | (365) | - | - | (365) |
Movement on foreign exchange | - | - | - | 1,039 | - | - | - | 118 | 1,157 |
Non-controlling interest in 5PT | - | - | - | - | - | - | - | 1,606 | 1,606 |
Total Comprehensive Income | - | - | - | 1,039 | - | (365) | (56) | 1,724 | 2,342 |
Sale of treasury shares | - | - | - | - | - | - | - | - | - |
Purchase of treasury shares | - | - | - | - | - | - | - | - | - |
Non-controlling interests | - | - | - | - | - | - | (90) | 90 | - |
Dividends paid | - | - | - | - | - | - | (554) | (13) | (567) |
At 1 Apr 2023 | 1,166 | 5,635 | 179 | (2,353) | (2,440) | (728) | 41,983 | 2,033 | 45,475 |
Profit for the period | - | - | - | - | - | - | (909) | - | (909) |
Net (loss) on financial assets at fair value through other comprehensive income | - | - | - | - | - | (1,137) | - | - | (1,137) |
Change in the proportion held in non-controlling interests | - | - | - | - | - | - | - | (265) | (265) |
Movement on foreign exchange | - | - | - | 149 | - | - | - | (58) | 91 |
Total Comprehensive Income | - | - | - | 149 | - | (1,137) | (909) | (323) | (2,220) |
Share options charge | - | - | 318 | - | - | - | - | - | 318 |
Non-controlling interests | - | - | - | - | - | - | (213) | 213 | - |
Dividends paid | - | - | - | - | - | - | - | (73) | (73) |
At 30 Sep 2023 | 1,166 | 5,635 | 497 | (2,204) | (2,440) | (1,865) | 40,861 | 1,850 | 43,500 |
CONSOLIDATED CASH FLOW STATEMENT
for the six months to 30 September 2023
| Notes | Six months to 30 Sep 2023 (unaudited) | Six months to 30 Sep 2022 (unaudited) | Year to 31 Mar 2023 (audited) |
| | £'000 | £'000 | £'000 |
Cash flows from/ (used in) operating activities | |
| | |
Operating (loss)/ profit | | (183) | 1,086 | 2,004 |
Adjustments for: | |
| | |
Depreciation of investment property, and property, plant & equipment | | 34 | 14 | 99 |
Profit on the sale of investment property | | - | (1,061) | (1,779) |
(Increase)/ decrease in inventories | | - | (59) | - |
(Increase)/ Decrease in trade and other receivables | | (1,626) | (1,679) | 777 |
(Decrease)/ increase in trade and other payables | | 1,348 | (415) | 2,813 |
Share options charge | | 318 | - | - |
Other non-cash adjustments | | 194 | 3 | 180 |
Cash generated from operations | | 85 | (2,111) | 4,094 |
Income taxes paid | | (169) | (124) | (616) |
Net cash flow (used in)/ from operating activities | | (84) | (2,235) | 3,478 |
| |
| | |
Cash flow from/ (used in) investing activities | |
| | |
Capital expenditure on investment properties | 6 | (315) | (81) | (1,017) |
Purchase of property, plant and equipment | | (21) | (8) | (10) |
Purchase of inventories | | - | (1,070) | - |
Proceeds from the sale of an investment property | | - | 2,967 | 8,612 |
Purchase of investment property | | - | - | (7,443) |
Cash paid on acquisition of new subsidiaries | | - | - | (165) |
Cash and cash equivalents received on acquisitions | | - | - | 83 |
Investment in funds | 8b | - | (2) | (3) |
Proceeds from funds | 8b | 434 | 907 | 1,492 |
Proceeds from Investment in shares of associates | 8a | 233 | 175 | 176 |
Interest received | 3 | 95 | 7 | 145 |
Investment in shares of associates | 8a | - | (757) | (606) |
Dividends from associates | 8a | - | - | - |
Distributions received | | 114 | 1,300 | 1,494 |
Net cash flow from/ (used in) investing activities | | 540 | 3,438 | 2,758 |
| |
| | |
Cash flow from/ (used in) financing activities | |
| | |
Proceeds from bank loan | | - | 1,686 | 1,474 |
Repayment of bank loans | | (911) | (2,977) | (5,215) |
Sale of shares held in treasury | | - | 119 | 57 |
Interest paid | 3 | (369) | (188) | (530) |
Dividends paid | | - | (277) | (831) |
Dividends paid to non-controlling interests | | (73) | (36) | (49) |
Net cash flow (used in)/ from financing activities | | (1,353) | (1,673) | (5,094) |
| |
| | |
Net (decrease)/ increase in cash and cash equivalents | | (897) | (470) | 1,142 |
Cash and cash equivalents at the beginning of period | | 7,647 | 6,419 | 6,419 |
Currency translation gains/ (losses) on cash and cash equivalents | | (43) | 28 | 86 |
Cash and cash equivalents at the end of the period | | 6,707 | 5,977 | 7,647 |
NOTES TO THE ACCOUNTS
for the six months ended 30 September 2023
1. Basis of Preparation
· These interim consolidated financial statements for the six months ended 30 September 2023 have not been audited or reviewed and do not constitute statutory accounts within the meaning of section 435 of the Companies Act 2006. They have been prepared in accordance with the Group's accounting policies as set out in the Group's latest annual financial statements for the year ended 31 March 2023 and are in compliance with IAS 34 "Interim Financial Reporting". These accounting policies are drawn up in accordance with UK-adopted International Accounting Standards.
· The comparative figures for the financial year ended 31 March 2023 are not the full statutory accounts for the financial year but are abridged from those accounts prepared under IFRS which have been reported on by the Group's auditors and delivered to the Registrar of Companies. The report of the auditors was unqualified, did not include references to any matter to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
· These interim financial statements were approved by a committee of the Board on 23 November 2023.
2. Segmental Analysis
Segment reporting for the six months to 30 September 2023
| Fund Management Division | Group Properties Division |
|
| |
| Property fund management | Group properties | Associates and investments | Unallocated central overheads | TOTAL |
| £'000 | £'000 | £'000 | £'000 | £'000 |
Rental income | - | 2,030 | - | - | 2,030 |
Service charge income | - | 673 | - | - | 673 |
Asset management fees | 1,263 | - | - | - | 1,263 |
Performance related fee income | - | - | - | - | - |
Total revenue | 1,263 | 2,703 | - | - | 3,966 |
| | | | |
|
Depreciation and amortisation | (21) | (13) | - | - | (34) |
| | | | |
|
Operating profit | 158 | 558 | - | (899) | (183) |
| | | | |
|
Share of results in associates | - | - | 517 | - | 517 |
Fair value adjustment to associate | - | - | (816) | - | (816) |
Investment income | - | - | 114 | - | 114 |
Interest income | - | 95 | - | - | 95 |
Interest expense | - | (379) | - | - | (379) |
Profit/ (loss) before tax | 158 | 274 | (185) | (899) | (652) |
| | | | |
|
Analysed as: | | | | |
|
Underlying profit/ (loss) before tax before adjusting for the following items: | 96 | 39 | 631 | (570) | 196 |
Interest on loan to associates | - | 63 | - | - | 63 |
Share option charge | - | - | - | (318) | (318) |
Fair value adjustment to associate | - | - | (816) | - | (816) |
Realised foreign currency (losses)/ gains | 62 | 172 | - | (11) | 223 |
Profit/ (loss) before tax | 158 | 274 | (185) | (899) | (652) |
Revenue for the six months to 30 September 2023 from continuing operations consists of revenue arising in the United Kingdom 18% (30 September 2022: 27%) and Central and Eastern Europe 82% (30 September 2022: 73%) and all relates solely to the Group's principal activities.
Direct costs incurred by First Property relating to the cost of the Board and the related share listing costs are shown separately under unallocated central costs.
Segment reporting for the six months to 30 September 2022
| Fund Management Division | Group Properties Division |
|
| |
| Property fund management | Group properties | Associates and investments | Unallocated central overheads | TOTAL |
| £'000 | £'000 | £'000 | £'000 | £'000 |
Rental income | - | 1,788 | - | - | 1,788 |
Service charge income | - | 737 | - | - | 737 |
Asset management fees | 1,437 | - | - | - | 1,437 |
Performance related fee income | 226 | - | - | - | 226 |
Total revenue | 1,663 | 2,525 | - | - | 4,188 |
| | | | |
|
Depreciation and amortisation | (18) | (12) | - | - | (30) |
| | | | |
|
Operating profit | 519 | 1,089 | - | (522) | 1,086 |
| | | | |
|
Share of results in associates | - | - | 117 | - | 117 |
Investment income | - | - | 1,302 | - | 1,302 |
Interest income | - | 75 | - | - | 75 |
Interest expense | - | (188) | - | - | (188) |
Profit/ (loss) before tax | 519 | 976 | 1,419 | (522) | 2,392 |
| | | | |
|
Analysed as: | | | | |
|
Underlying profit/ (loss) before tax before adjusting for the following items: | 294 | 27 | 223 | (540) | 4 |
Interest on loan to FOP | - | 68 | - | - | 68 |
Profit on Sale of Group properties | - | 1,061 | - | - | 1,061 |
Performance related fee income | 226 | - | - | - | 226 |
Investment income resulting from sale of properties | - | - | 1,196 | - | 1,196 |
Staff incentives | - | - | - | - | - |
Realised foreign currency (losses)/ gains | (1) | (180) | - | 18 | (163) |
Profit/ (loss) before tax | 519 | 976 | 1,419 | (522) | 2,392 |
Segment reporting for the year to 31 March 2023
| Fund Management Division | Group Properties Division | |
| |
| Property fund management | Group properties | Associates and investments | Unallocated central overheads | TOTAL |
| £'000 | £'000 | £'000 | £'000 | £'000 |
Rental income | - | 3,614 | - | - | 3,614 |
Service charge income | - | 1,115 | - | - | 1,115 |
Asset management fees | 2,892 | - | - | - | 2,892 |
Performance related fee income | (372) | - | - | - | (372) |
Total revenue | 2,520 | 4,729 | - | - | 7,249 |
| | | | |
|
Depreciation and amortisation | (36) | (24) | - | - | (60) |
| | | | |
|
Operating profit | 120 | 3,069 | - | (1,185) | 2,004 |
Share of results in associates | - | - | 273 | - | 273 |
Fair value adjustment on associates | - | - | (901) | - | (901) |
Investment income | - | - | 1,497 | - | 1,497 |
Interest income | - | 20 | - | 125 | 145 |
Interest expense | - | (530) | - | - | (530) |
Profit/ (loss) before tax | 120 | 2,559 | 869 | (1,060) | 2,488 |
| | | | |
|
Analysed as: | | | | |
|
Underlying profit/ (loss) before tax before adjusting for the following items: | 513 | 752 | 273 | (1,089) | 449 |
Provision in respect of rent guarantee | - | 511 | - | - | 511 |
Profit on the sale of investment properties | - | 1,779 | - | - | 1,779 |
Interest received on loan to FOP | - | 125 | - | - | 125 |
Fair value adjustment on associates FOP | - | - | (901) | - | (901) |
UK fund distributions following sale of properties | - | - | 1,497 | - | 1,497 |
Performance related fee income | 222 | - | - | - | 222 |
Clawback of Office income | (594) | - | - | - | (594) |
Staff incentives | (44) | (65) | - | - | (109) |
Realised foreign currency (losses)/ gains | 23 | (543) | - | 29 | (491) |
Total | 120 | 2,559 | 869 | (1,060) | 2,488 |
| | | | |
|
Assets - Group | 795 | 54,525 | 4,544 | 4,727 | 64,591 |
Share of net assets of associates | - | - | 17,588 | - | 17,588 |
Liabilities | (71) | (36,574) | - | (59) | (36,704) |
Net assets | 724 | 17,951 | 22,132 | 4,668 | 45,475 |
3. Interest Income/ (Expense)
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 | Year ended 31 Mar 2023 |
| £'000 | £'000 | £'000 |
Interest income - bank deposits | 22 | - | - |
Interest income - other | 73 | 75 | 145 |
Total interest income | 95 | 75 | 145 |
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 | Year ended 31 Mar 2023 |
| £'000 | £'000 | £'000 |
Interest expense - property loans | (373) | (180) | (516) |
Interest expense - bank and other | (6) | (8) | (14) |
Total interest expense | (379) | (188) | (530) |
4. Tax Expense
The tax charge is based on a combination of actual current and deferred tax charged at an effective rate that is expected to apply to the profits for the full year.
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 | Year ended 31 Mar 2023 |
| £'000 | £'000 | £'000 |
Current tax | (146) | (204) | (559) |
Deferred tax | (111) | (93) | 110 |
Total | (257) | (297) | (449) |
5. Earnings/ NAV Per Share
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 | Year ended 31 Mar 2023 |
Basic (loss)/ earnings per share | (1.01p) | 1.86p | 1.73p |
Diluted (loss)/ earnings per share | (0.99p) | 1.83p | 1.70p |
The basic earnings per ordinary share is calculated on the profit on ordinary activities after taxation and after excluding non-controlling interests on the weighted average number of ordinary shares in issue, during the period.
Figures in the table below have been used in the calculations.
| £'000 | £'000 | £'000 |
Basic earnings per share | (1,122) | 2,065 | 1,919 |
Notional interest on share options assumed to be exercised | 2 | 3 | 2 |
Diluted earnings assuming full dilution | (1,120) | 2,068 | 1,921 |
| Number | Number | Number |
Weighted average number of Ordinary Shares in issue | 110,875,483 | 110,868,671 | 110,875,483 |
Number of Share options | 2,110,000 | 2,110,000 | 2,110,000 |
Total number of Ordinary Shares used in the diluted earnings per Share calculation | 112,985,483 | 112,978,671 | 112,985,483 |
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 (restated) | Year ended 31 Mar 2023 |
Net assets per share | 37.56p | 39.20p | 39.18p |
Adjusted net assets per share | 43.56p | 47.12p | 46.50p |
The following numbers have been used to calculate both the net assets and adjusted net assets per share:
| Six months ended 30 Sep 2023 | Six months ended 30 Sep 2022 (restated) | Year ended 31 Mar 2023 |
| £'000 | £'000 | £'000 |
Net assets excluding non-controlling interest | 41,650 | 43,468 | 43,442 |
|
| | |
For adjusted net assets per share | £'000 | £'000 | £'000 |
Net assets excluding non-controlling interests | 41,650 | 43,468 | 43,442 |
Investment properties at fair value net of deferred taxes | 4,981 | 2,102 | 5,639 |
Inventories at fair value net of deferred taxes | - | 2,847 | - |
Investments in associates at fair value | 2,269 | 4,506 | 3,139 |
Other items | 323 | 323 | 324 |
Total | 49,223 | 53,246 | 52,544 |
6. Investment Properties
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
1 Apr | 47,009 | 23,849 | 23,849 |
Reclassification of inventory | - | 19,795 | - |
Additions arising on consolidation | - | 7,621 | - |
Capital expenditure | 315 | 1,017 | 81 |
Disposals | - | (6,459) | (1,723) |
Depreciation | (134) | (134) | (14) |
Foreign exchange translation | (56) | 1,320 | 646 |
Total at end of period | 47,134 | 47,009 | 22,839 |
Investment properties owned by the Group are stated at cost less depreciation and accumulated impairment losses.
7. Inventory - Land and Buildings
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
1 Apr | - | 12,352 | 12,352 |
Purchase including acquisition costs | - | 7,443 | 7,443 |
Reclassified as investment property | - | (19,795) | - |
Capital expenditure | - | - | 92 |
Disposals | - | - | - |
Depreciation | - | - | (33) |
Foreign exchange translation | - | - | (132) |
Total at end of period | - | - | 19,722 |
During the year ended 31 March 2023 the Group acquired an additional 7,171 m2 of office space in Blue Tower (an office block in Warsaw) for a consideration of £7.20 million, which is payable in seven instalments over a six-year period. Following this purchase, the Group's interest in Blue Tower now represents 80.3% (2022: 48.2%) of the building. As a result of this acquisition the Group reclassified the building from Inventory to Investment Property.
8. Investments in associates and other financial investments
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
a) Associates |
| | |
Cost of investment at beginning of period | 17,588 | 19,135 | 19,135 |
Additions | - | 606 | 757 |
Disposals | - | (1,349) | - |
Repayment of shareholder loan | (233) | (176) | (175) |
Share of associates profit/(loss) after tax | 517 | 273 | 117 |
Share of associates revaluation gains | (816) | (901) | - |
Dividends received | - | - | - |
Cost of investment at end of period | 17,056 | 17,588 | 19,834 |
The disposal in the year ended 31 March 2023 represents the Group gaining control of 5PT. Following the purchase of additional shares in this company the Group is now deemed to have control and has consolidated this fund into the Group.
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
Investments in associates |
| | |
5th Property Trading Ltd | - | - | 1,861 |
Fprop Galeria Corso Ltd | 2,918 | 3,058 | 2,888 |
Fprop Krakow Ltd | 1,181 | 1,154 | 1,578 |
Fprop Cluj Ltd | 652 | 636 | 602 |
Fprop Phoenix Ltd | - | 61 | 478 |
Fprop Opportunities plc | 12,305 | 12,679 | 12,735 |
| 17,056 | 17,588 | 20,142 |
Less: Group share of profit after tax withheld on sale of property to an associate in 2007 | - | - | (308) |
Cost of investment at end of period | 17,056 | 17,588 | 19,834 |
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
b) Other financial investments |
| | |
Cost of investment at 1 Apr | 4,544 | 7,445 | 7,445 |
Additions | - | 3 | 2 |
Repayments | (434) | (1,492) | (907) |
(Decrease) in fair value during the period | (1,137) | (1,412) | (1,047) |
Cost of investment at end of period | 2,973 | 4,544 | 5,493 |
The Group holds four unlisted investments in funds managed by FPAM. Each is designated at fair value through "Other Comprehensive Income" (OCI) as per IFRS 9. The Directors consider their fair value to not be materially different from their carrying value.
Fair value has been calculated by applying the Group's percentage holding in the investments to the fair value of their net assets.
9. Trade and Other Receivables
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
Current assets |
| | |
Trade receivables | 2,534 | 1,130 | 1,168 |
Less provision for impairment of receivables | (225) | (242) | (96) |
Trade receivables net | 2,309 | 888 | 1,072 |
Other receivables | 1,852 | 1,820 | 3,587 |
Prepayments and accrued income | 1,193 | 1,021 | 1,454 |
Total at end of period | 5,354 | 3,729 | 6,113 |
10. Trade and Other Payables
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 (restated) |
| £'000 | £'000 | £'000 |
Current liabilities |
| | |
Trade payables | 1,824 | 1,227 | 755 |
Other taxation and social security | 239 | 254 | 277 |
Other payables and accruals | 2,462 | 1,701 | 3,297 |
Deferred income | 188 | 128 | 157 |
Total at end of period | 4,713 | 3,310 | 4,486 |
11. Provisions
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
Current liabilities | 113 | 158 | 773 |
The provision at 30 September 2023 represents a rent guarantee of £0.11 million (31 March 2023: £0.16 million) and fit out costs of £Nil (31 March 2023: £Nil). These provisions are in respect of the guarantee given as part of the sale of a property, Cha?ubi?skiego 8 ("CH8"), which completed in April 2020.
As a condition of the sale the Group guaranteed the rental and service charge income up to some ?1.20 million per annum for five years. In addition, the Group guaranteed fit-out costs on the residual vacant space up to some ?1.50 million.
12. Financial Liabilities
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
Current liabilities |
| | |
Bank loans | 1,067 | 1,116 | 5,648 |
Total at end of period | 1,067 | 1,116 | 5,648 |
|
| | |
Non-current liabilities |
| | |
Bank loans | 10,921 | 11,519 | 7,114 |
Total at end of period | 10,921 | 11,519 | 7,114 |
|
| | |
Total obligations under financial liabilities |
| | |
Repayable within one year | 1,067 | 1,116 | 5,648 |
Repayable within one and five years | 7,890 | 8,080 | 6,629 |
Repayable after five years | 3,031 | 3,439 | 485 |
Total at end of period | 11,988 | 12,635 | 12,762 |
Five bank loans (all denominated in Euros) totalling £11.99 million (31 March 2023: £12.64 million), included within financial liabilities, are secured against investment properties owned by the Group. These bank loans are otherwise non-recourse to the Group's assets.
The interest rate profile of the Group's financial liabilities at 30 September 2023 and 31 March 2023 was as follows:
| Interest bearing | Non- interest bearing | Total
|
| £'000 | £'000 | £'000 |
Financial liabilities | 11,988 | - | 11,988 |
Other financial liabilities | - | 16,946 | 16,946 |
At 30 Sep 2023 | 11,988 | 16,946 | 28,934 |
|
|
|
|
Financial liabilities | 12,635 | - | 12,635 |
Other financial liabilities | - | 17,021 | 17,021 |
At 31 Mar 2023 | 12,635 | 17,021 | 29,656 |
A one percentage point increase in interest rates would increase the annual interest rate bill by £0.12 million per annum (31 March 2023: £0.13 million per annum).
13. Other Financial Liabilities
| Six months ended 30 Sep 2023 | Year ended 31 Mar 2023 | Six months ended 30 Sep 2022 |
| £'000 | £'000 | £'000 |
Current liabilities | 12,286 | 939 | 907 |
Non-current liabilities | 4,660 | 16,082 | 15,863 |
Total at end of period | 16,946 | 17,021 | 16,770 |
|
| | |
Total obligations under financial liabilities |
| | |
Repayable within one year | 12,286 | 939 | 907 |
Repayable within one and five years | 4,660 | 14,317 | 14,159 |
Repayable after five years | - | 1,765 | 1,704 |
Total at end of period | 16,946 | 17,021 | 16,770 |
Other financial liabilities includes a balance within current liabilities of ?12.00 million which was a result of the restructuring of a finance lease secured against the office tower in Gdynia. As part of the deal, the Group acquired the freehold of the property for ?16.00 million of which ?4.00 million has been paid and ?12.00 million is payable in the financial year ended 31 March 2025. No interest is payable on this liability.
Other financial liabilities also represents the Group's additional 32% investment in Blue Tower, Warsaw, which was financed by deferred consideration of PLN 40.4 million (£7.44 million). This liability, which is non-interest bearing, is payable in seven instalments, the first of which has been paid.
The interim results are being circulated to all shareholders and can be downloaded from the company's web site - www.fprop.com. Further copies can be obtained from the registered office at 32 St James's Street, London SW1A 1HD.
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