TIDMPNS
RNS Number : 2252A
Panther Securities PLC
22 September 2022
22 September 2022
Panther Securities PLC
(the "Company")
Interim Report for the six months ended 30 June 2022
Chairman's Statement
I am once again pleased to report our results for the six months
ended 30 June 2022. We show a profit after tax of GBP9,958,000,
compared to a profit after tax of GBP8,856,000 for the first half
of 2021.
As with previous periods, the major contributors to the
significant profit after tax figures are the non-cash valuation
movements mainly in relation to swap value movements.
In February 2021, the Group agreed to pay GBP5 million to have a
variation to a long-term swap agreement. The agreement varied was
an interest rate swap fixed at 5.06% until 31 August 2038 on a
nominal value of GBP35 million and now has circa 16.2 years
remaining. Following the Group's variation, the Group's fixed rate
will drop on 1 September 2023 to 3.40%, saving the Group GBP581,000
pa in cash flow until the end-point of the instrument.
At 30 June 2022, there was a swap liability reduction compared
to that shown at 31 December 2021 of GBP11,329,000 due to upward
spike in the current and future interest rates, thus contributing
to the improvement of our net asset value, which was 553p per share
as at 31 December 2021 and 599p per share as at 30 June 2022.
Secondly, we revalued our property portfolio for the half year
accounts and there was one significant event being a substantial
letting at Maldon at a higher rent of GBP800,000 per annum
(previously GBP600,000 per annum) and this resulted in a valuation
increase of GBP2,050,000.
Rents receivable during the period under review were
GBP6,387,000 compared to the previous year's first half of
GBP6,447,000. There were still some concessions given to our
tenants who had suffered due to the various lockdowns, which are
recognised in the period, but they were not significant. Our rents
appear to be strengthening, and at the end of August our rent roll
was circa GBP14.7 million on an annualised basis.
Disposals
There were no disposals during this period.
Acquisitions
In May 2022, we acquired the Lower Healey Business Park in
Chorley, Lancashire. The freehold estate comprises approximately 10
acres containing 116,000 sq. ft. of single storey factory space let
to a number of different tenants with some vacant land capable of
further development. We understand there is good tenant demand in
this area partly because the Estate adjoins the M61 and is 2.5
miles from Exit 8. This Estate is currently producing GBP432,000
per annum and cost GBP5,026,000, including purchasing costs.
In June 2022, we completed our purchase of the previously
mentioned substantial freehold factory and warehouse in Trowbridge,
Wiltshire. This comprised of approximately 96,000 sq.ft. of usable
space situated in approximately six acres. This property is located
on one of the best industrial estates in Trowbridge where demand is
strong.
This unit was purchased vacant for GBP3,300,000 and has since
been let in August to an excellent covenant at GBP455,000 per annum
exclusive and will undoubtedly show a substantial value increase
when we revalue for our year end.
Developments
Peterborough
The former Beales store in Peterborough, currently partly
occupied by New Start 2020 Limited, trading as Beales, has had a
planning application submitted for a large mixed-use development of
shops/offices and 125 residential units whilst retaining a
substantial part of the existing attractive Edwardian brick
building façade. The current older style department store contains
approximately 145,000 sq. ft. of space unsuitable for current
retail markets and may receive a decision by the end of this
year.
Barry Parade, Peckham Rye
The plans for this redevelopment of a local supermarket, shops
and fourteen flats, have been agreed in their entirety, subject to
Section 106 payment which is over and above the normal conditions.
There is an appeal in progress.
Broadstairs
This development is fully completed with eleven out of twelve
flats now let. Tesco Express is on the ground floor and opened for
trade in July 2021, and this development made a welcome addition to
Broadstairs High Street. This asset at the time of writing was
producing GBP180,000 per annum.
Swindon
Whilst everything with regard to the two planning permissions on
this central Swindon site have been agreed, progress has been slow
due to the council requiring some complicated clauses in the new
250 year lease, the overall financial terms of which were
previously provisionally agreed.
Whilst we expect to resolve these issues soon, the delay is
disappointing but, in due course, the improvement to the former
covered market site will take place.
Dividends
We paid a delayed 6p per share interim dividend for year ended
31 December 2021 in February 2022.
We also paid a 6p per share final dividend for the year ended 31
December 2021 on 20 July 2022. This final dividend for the year
ended 31 December 2021 is accrued in these accounts as it was not
paid until after the period end (but was approved by
shareholders).
We are declaring an interim dividend for the year ending 31
December 2022 of 6p per share to be paid on 20 October 2022 to
shareholders on the register at 7 October 2022 (ex-dividend 6
October 2022). We expect to maintain our dividend for the full
year.
Future progress
The country, both the public and businesses, finally having
substantially recovered from the problems caused by the coronavirus
pandemic, have now been thrown into a further period of uncertainty
by the problems caused by the Russian invasion of the Ukraine.
I suspect that, like myself, most of us were unaware of the now
obvious repercussions of this unwarranted invasion of the Ukraine.
The fact that Russia is one of the world's largest oil and gas
producers and the major supplier of Europe's energy has enabled it
to weaponise this position to bring pressure on all of its
opponents who are horrified by its actions. Russia's ability to
blockade the Ukraine's export of wheat when it is one of the
world's major producers together with its ability to restrict the
flow of gas into Europe has caused an upward burst in world
inflation, especially in energy costs, which for some users will
triple over three years and which will cause major problems for
many small and large businesses and the vast majority of our
population.
We are all currently awaiting what measures our government will
take to alleviate this very difficult situation.
In this environment caution is our watch word and, thus, our
Group will act accordingly.
Andrew S Perloff
Chairman
22 September 2022
Chairman's Ramblings
On Thursday, 8(th) September, our much-admired and loved Queen
Elizabeth II died rather suddenly, only two days after receiving
the resignation of her Prime Minister, Boris Johnson and inviting
Liz Truss to take over his role.
Although a great admirer and supporter of the monarchy and our
late Queen, in particular, possibly because my earliest memories
start with viewing on a TV especially purchased to view her
Coronation which was televised for the first time in June 1953. I
do not feel qualified to comment further as we have heard and read
so many eloquent and touching comments of our Queen's service to
our country, and via our modern media, we have also visually seen
the affection in which so many people held her. Having lived 90% of
my life under her reign, I consider myself an Elizabethan.
Whilst it is too early to comment on our new Prime Minister
after she has had only a few weeks in power, I wish her good luck
in her desire to improve our country, and would add that I like
many of her proposed ideas which she set out in her successful
campaign to be chosen as the new Conservative leader and, thus,
Prime Minister.
Of course, only time will tell what her performance will be in
what is probably the most important and difficult job in our United
Kingdom.
Panther Securities P.L.C.
CONDENSED CONSOLIDATED INCOME STATEMENT
for the six months ended 30 June 2022
Notes Six months Six months Year
ended ended ended
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Revenue 2 6,387 6,447 13,172
Cost of sales 2 (2,891) (1,838) (4,651)
----------- ----------- ------------
Gross profit 3,496 4,609 8,521
Other income 325 321 958
Administrative expenses (699) (830) (1,492)
Bad debt expense (858) (658) (286)
----------- ----------- ------------
Operating profit 2,264 3,442 7,701
Profit on disposal of investment properties - 88 701
Movement in fair value of investment
properties 6 2,050 1,213 961
----------- ----------- ------------
4,314 4,743 9,363
Finance costs - interest (1,385) (969) (2,322)
Finance costs - swap interest (954) (1,439) (2,806)
Finance costs - swap variation 7 - (5,000) (5,000)
Investment income 10 17 29
Loss realised on the disposal of investments
(shares) - (100) (96)
Fair value gain on derivative financial
liabilities 7 11,329 14,326 16,754
----------- ----------- ------------
Profit before income tax 13,314 11,578 15,922
Income tax expense 3 (3,356) (2,722) (2,411)
----------- ----------- ------------
Profit for the period 9,958 8,856 13,511
=========== =========== ============
Earnings per share
Basic and diluted - continuing operations 5 56.5p 50.1p 76.4p
----------- ----------- ------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 June 2022
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Profit for the period 9,958 8,856 13,511
----------- ----------- ------------
Items that will not be reclassified
subsequently to profit or loss
Movement in fair value of investments
taken to equity (47) 77 55
Deferred tax relating to movement in
fair value of investments taken to
equity 12 (15) (14)
Realised fair value on disposal of
investments previously taken to equity - 143 148
Realised deferred tax relating to disposal
of investments previously taken to
equity - (27) (37)
-----------
Other comprehensive (loss)/income
for the period, net of tax (35) 178 152
Total comprehensive income for the
period 9,923 9,034 13,663
----------- ----------- ------------
Attributable to:
Equity holders of the parent 9,923 9,034 13,663
9,923 9,034 13,663
----------- ----------- ------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Company number 293147
As at 30 June 2022
Notes 30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
ASSETS Unaudited Unaudited Audited
Non-current assets
Investment properties 6 177,723 182,031 167,384
Deferred tax asset 8 - 1,049 2,252
Right of use asset 296 335 298
Investments 304 335 292
---------- ---------- --------------
178,323 183,750 170,226
---------- ---------- --------------
Current assets
Stock properties 350 350 350
Investments 29 29 29
Trade and other receivables 3,383 3,873 2,996
Cash and cash equivalents (restricted) 4 1,052 5,009
Cash and cash equivalents 5,534 3,377 8,343
---------- ---------- --------------
9,300 8,681 16,727
Total assets 187,623 192,431 186,953
---------- ---------- --------------
EQUITY AND LIABILITIES
Equity attributable to equity holders
of the parent
Capital and reserves
Share capital 4,437 4,437 4,437
Share premium account 5,491 5,491 5,491
Treasury shares (482) (213) (213)
Capital redemption reserve 604 604 604
Retained earnings 95,265 82,835 87,464
Total equity 105,315 93,154 97,783
---------- ---------- --------------
Non-current liabilities
Long-term borrowings 7 58,910 18 55,513
Derivative financial liability 7 3,926 17,683 15,255
Deferred tax liability 8 1,092 - -
Leases 8,353 8,339 8,353
---------- ---------- --------------
72,281 26,040 79,121
Current liabilities
Trade and other payables 8,202 8,922 9,361
Accrued dividend payable 4 1,061 1,061 -
Short-term borrowings 7 500 63,066 560
Current tax payable 264 188 471
---------- ---------- --------------
10,027 73,237 10,049
Total liabilities 82,308 99,277 89,170
---------- ---------- --------------
Total equity and liabilities 187,623 192,431 186,953
---------- ---------- --------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2022
Capital
Share Share Treasury redemption Retained
capital premium shares reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2021 (audited) 4,437 5,491 (213) 604 75,923 86,242
Total comprehensive
income for the period - - - - 9,034 9,034
Dividends paid - - - - (1,061) (1,061)
Dividends due - - - - (1,061) (1,061)
--------- --------- ----------- ------------ ---------- ---------
Balance at 30 June
2021 (unaudited) 4,437 5,491 (213) 604 82,835 93,154
--------- --------- ----------- ------------ ---------- ---------
Balance at 1 January
2021 (audited) 4,437 5,491 (213) 604 75,923 86,242
Total comprehensive
income for the period - - - - 13,663 13,663
Dividends paid - - - - (2,122) (2,122)
--------- --------- ----------- ------------ ---------- ---------
Balance at 1 January
2022 (audited) 4,437 5,491 (213) 604 87,464 97,783
Total comprehensive
income for the period - - - - 9,923 9,923
Treasury shares purchased - - (269) - - (269)
Dividends paid - - - - (1,061) (1,061)
Dividends due - - - - (1,061) (1,061)
Balance at 30 June
2022 (unaudited) 4,437 5,491 (482) 604 95,265 105,315
========= ========= =========== ============ ========== =========
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
for the six months ended 30 June 2022
Notes 30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Cash flows from operating activities
Operating profit 2,264 3,442 7,701
Less: Rent paid treated as interest (343) (343) (687)
Profit before working capital change 1,921 3,099 7,014
(Increase)/decrease in receivables (387) 351 929
(Decrease) in payables (573) (104) (48)
---------- ---------- ------------
Cash generated from operations 961 3,346 7,895
Interest paid (1,848) (2,064) (4,295)
Income tax paid (208) - (620)
---------- ---------- ------------
Net cash (used in)/generated from operating
activities (1,095) 1,282 2,980
Cash flows from investing activities
Purchase of investment properties (8,529) (569) (832)
Purchase of investments** (60) (6) (6)
Proceeds from sale of investment property - 178 15,841
Proceeds from sale of investments** - 403 435
Dividend income received 8 17 21
Interest income received 2 - 8
---------- ---------- ------------
Net cash (used in)/generated from investing
activities (8,579) 23 15,467
Cash flows from financing activities
New loans received 8,500 - 6,000
Finance cost (SWAP variation) - (5,000) (5,000)
Repayments of loans (5,060) (33) (12,057)
Loan amortisation repayments (250) - (250)
Purchase of own shares (269) - -
Loan arrangement fees - - (884)
Dividends paid (1,061) (1,061) (2,122)
Net cash generated from/ (used in) financing
activities 1,860 (6,094) (14,313)
Net (decrease)/increase in cash and
cash equivalents (7,814) (4,789) 4,134
Cash and cash equivalents at the beginning
of period* 13,352 9,218 9,218
Cash and cash equivalents at the end
of period* 5,538 4,429 13,352
---------- ---------- ------------
* Of this balance GBP4,000 (30 June 2021: GBP1,052,000, 31
December 2021: GBP5,009,000) is restricted by the Group's lenders
i.e. it can only be used for the purchase of investment property
(or otherwise by agreement).
** Shares in listed and/or unlisted companies. These were held
for longer term growth and dividend return.
1. Basis of preparation of interim financial statements
The results for the year ended 31 December 2021 have been
audited whilst the results for the six months ended 30 June 2021
and 30 June 2022 are unaudited.
The financial information set out in this interim financial
report does not constitute statutory accounts as defined in Section
434 of the Companies Act 2006. The Group's statutory accounts for
the year ended 31 December 2021 which were prepared in accordance
with UK-adopted international accounting standards ("IFRS"), were
filed with the Registrar of Companies. The auditors reported on
these accounts, their report was unqualified and did not included a
reference to any matters to which the auditors drew attention by
way of emphasis without qualifying their report and did not contain
any statements under Section 498 (2) or Section 498 (3) of the
Companies Act 2006.
These condensed consolidated interim financial statements are
for the six month period ended 30 June 2022. They have been
prepared in accordance with UK adopted international accounting
standards in conformity with the requirements of the Companies Act
2006.
A number of new and amended standards and interpretations are
effective from 1 January 2022 but they do not have a material
effect on the Group's financial statements.
2. Revenue and cost of sales
The Group's only operating segment is investment and dealing in
property and securities. All revenue, cost of sales and profit or
loss before taxation is generated in the United Kingdom. The Group
is not reliant on any key customers.
3. Income tax expense
The charge for taxation comprises the following:
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Current period UK corporation
tax - - (971)
Prior period UK corporation
tax - - 67
---------- ------------ ------------
- - (904)
Current period deferred
tax expense (3,356) (2,722) (1,507)
---------- ------------ ------------
Income tax expense for
the period (3,356) (2,722) (2,411)
========== ============ ============
The taxation charge is calculated by applying the Directors'
best estimate of the annual effective tax rate to the profit for
the period.
4. Dividends
Amounts recognised as distributions to equity holders in the
period:
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Final dividend for the
year ended 31 December
2021 of 6p (2020 - 6p)
per share 1,061* 1,061* 1,061
Interim dividend for the
year ended 31 December
2021 of 6p (2020 - 6p)
per share 1,061 1,061 1,061
2,122 2,122 2,122
========== ========== ============
The final dividend of 6p per share for the year ended 31
December 2021 (and 2020) was not paid during the period to 30 June
2022 but declared and approved (being accrued in these accounts)
and was paid on 20 July 2022 (14 October 2021).
*Accrued at half year and paid after period end.
5. Earnings per share (basic and diluted)
The calculation of basic and diluted earnings per ordinary share
is based on earnings being a profit of GBP9,958,000 (30 June 2021 -
GBP8,856,000 and 31 December 2021 - GBP13,511,000).
The basic earnings per share is based on the weighted average of
the ordinary shares in existence throughout the period, being
17,628,469 to 30 June 2022 (17,683,469 to 31 December 2021 and
17,683,469 to 30 June 2021). There are no potential shares in
existence for any period and therefore diluted and basic earnings
per share are equal.
Panther Securities PLC owns 173,460 ordinary shares which are
currently held in treasury (2021 - 63,460).
6. Investment properties
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Fair value of investment
properties
At 1 January 167,384 180,975 180,975
Additions 8,289 233 537
Disposals - (390) (15,140)
Fair value adjustment
on investment properties
held on leases - - 51
Revaluation increase/
(decrease) 2,050 1,213 961
At period end 177,723 182,031 167,384
========== ========== ============
The Directors undertook the valuation as at 30 June 2022 and 31
December 2021, however an independent valuation by Carter Jonas at
as July 2021 was used as at the 30 June 2021 (and also used as a
starting point for the Directors' valuation for the year ended 31
December 2021).
7. Derivative financial instruments
The main risks arising from the Group's financial instruments
are those related to interest rate movements. Whilst there are no
formal procedures for managing exposure to interest rate
fluctuations, the Board continually reviews the situation and makes
decisions accordingly. Hence, the Company will, as far as possible,
enter into fixed interest rate swap arrangements. The purpose of
such transactions is to manage the interest rate risks arising from
the Group's operations and its sources of finance.
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Bank loans Unaudited Rate Unaudited Rate Audited Rate
Interest is charged
as to:
Fixed/ Hedged
HSBC Bank plc* 35,000 7.76% 35,000 7.01% 35,000 7.76%
HSBC Bank plc - - 25,000 6.58% - -
Santander Bank plc 25,000 4.71% - - 25,000 4.71%
Unamortised loan arrangement
fees (590) - - - (737) -
Floating element
HSBC Bank plc - 3,000 (3,250)
Shawbrook Bank plc - 84 60
---------- ------- ----------
59,410 63,084 56,073
========== ======= ==========
* Fixed rate came into effect on 1 September 2008 and lasts for
30 years. The rate includes 2.70% margin (1.95% prior to 16 July
2021). There are no breaks and the rate drops to 3.40% on 1
September 2023 to the end of its term on 31 August 2038.
Bank loans totalling GBP60,000,000 (2021 - GBP60,000,000) are
fixed using interest rate swaps removing the Group's exposure to
interest rate risk. The remaining borrowings are arranged at
floating rates, thus exposing the Group to cash flow interest rate
risk. The Group at the period end had a GBP54,500,000 term facility
(after loan amortisation repayments) and a GBP11,000,000 revolving
(with only GBP5,500,000 drawn).
The derivative financial assets and liabilities are designated
as held for trading.
Hedged Rate Duration 30 June 30 June 31 December
amount (without of contract 2022 2021 2021
margin) remaining Fair value Fair value Fair value
GBP'000 years GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Derivative financial
liability
Interest rate
swap* 35,000 5.060% 16.19 (4,676) (14,169) (12,833)
Interest rate
swap** 25,000 4.630% - - (512) -
Interest rate
swap 25,000 2.013% 9.42 750 (3,002) (2,422)
------------
(3,926) (17,683) (15,255)
------------ ------------ ------------
Movement in derivative financial liabilities 11,329 14,326 16,754
============ ============ ============
*The Group has paid GBP5m in February 2021 to vary this
long-term swap agreement. The agreement varied the fixed rate
previously at 5.06% until 31 August 2038 on a nominal value of
GBP35m. Following the variation, the Group's fixed rate will drop
on 1 September 2023 to 3.40% saving the Group circa GBP581,000pa in
cash flow until the end point of the instrument.
**This swap agreement ended on 30 November 2021.
As the Group's new loan facility entered into in July 2021 is
referenced to SONIA rather than LIBOR, the Group recently altered
its swap agreements onto the same basis.
Interest rate derivatives are shown at fair value in the
Statement of Financial Position, with charges in fair value taken
to the Income Statement. Interest rate swaps are classified as
level 2 in the fair value hierarchy specified in IFRS 13.
The vast majority of the derivative financial liabilities are
due in over one year and therefore they have been disclosed as all
due in over one year.
The above fair values are based on quotations from the Group's
banks and Directors' valuation.
Treasury management
The long-term funding of the Group is maintained by three main
methods, all with their own benefits. The Group has equity finance,
has surplus profits and cash flow which can be utilised and also
has loan facilities with financial institutions. The various
available sources provide the Group with more flexibility in
matching the suitable type of financing to the business activity
and ensure long-term capital requirements are satisfied.
8. Deferred taxation
The following are the major deferred tax assets and liabilities
recognised by the Group, and the movements thereon, during the
current and prior reporting periods.
Total
GBP'000
Asset at 1 January 2021 3,810
Debit to equity for the year (51)
Debit to Income Statement for the year (1,507)
Asset at 1 January 2022 2,252
Debit to equity for the period 12
Debit to Income Statement for the period (3,356)
--------
Liability at 30 June 2022 (1,092)
========
Deferred taxation arises in relation to:
Deferred tax
30 June 30 June 31 December
2022 2021 2021
GBP'000 GBP'000 GBP'000
Deferred tax liabilities:
Investment properties (2,540) (2,678) (2,016)
Deferred tax assets:
Tax allowances in excess of book
value 323 271 323
Fair value of investments 143 96 131
Derivative financial liability 982 3,360 3,814
--------
Net deferred tax asset (1,092) 1,049 2,252
======== ======== ============
As at 30 June 2022 the substantively enacted rate was 25% (30
June 2021: 19% and 31 December 2021: 25%) and this has been used
for the deferred tax calculation.
9. Net asset value per share
30 June 30 June 31 December
2022 2021 2021
Unaudited Unaudited Audited
Basic and diluted 599p 527p 553p
========== ========== ============
10. Copies of this report are to be sent to all shareholders and
are available from the Company's registered office at Unicorn
House, Station Close, Potters Bar, EN6 1TL and will also be
available for download from our website www.pantherplc.com .
For further information:
Panther Securities plc: Tel: 01707 667 300
Andrew Perloff / Simon Peters
Allenby Capital Limited (Nomad and Joint Broker) Tel: 020 3328
5656
David Worlidge / Alex Brearley
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END
IR FLFSAARILFIF
(END) Dow Jones Newswires
September 22, 2022 02:01 ET (06:01 GMT)
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