TIDMEFD
RNS Number : 8466D
Eatonfield Group plc
09 December 2009
+---------------------------------------+---------------------------------------+
| For immediate release | 9 December 2009 |
+---------------------------------------+---------------------------------------+
Eatonfield Group plc
("Eatonfield" or "the Group")
Preliminary Announcement of the Results for the Year ended 30 June 2009
Eatonfield Group plc, the commercial property company, is pleased to announce
its results for the year ended 30 June 2009.
Financial summary
* Loss for the year GBP4,352,555 (2008: GBP2,880,514 profit)
* Net debt GBP30,511,234 (2008: GBP30,371,927)
* Successful placing in October raising GBP6.9 million net of expenses
* Application to acquire Paignton site accepted and bank funding approved
* Significant progress on flagship projects
+---------------------------------------+---------------------------------------+
| Eatonfield Group plc | Tel: (+44) (0)1829 261 910 |
| Paul Williams (Chairman) | Tel: (+44) (0)1829 261 910 |
| Rob Lloyd (Chief Executive) | |
| | |
+---------------------------------------+---------------------------------------+
| Buchanan Communications | Tel: (+44) (0)207 466 5000 |
| Jeremy Garcia/Christian Goodbody | |
| | |
+---------------------------------------+---------------------------------------+
| Evolution Securities | Tel: (+44) (0)113 243 1619 |
| Joanne Lake/Peter Steel | Tel: (+44) (0)203 137 1904 |
| Orbis Equity Partners Limited | |
| Jeremy King | |
+---------------------------------------+---------------------------------------+
About Eatonfield Group plc
Eatonfield's key strengths lie in its property management knowledge and
expertise and the ability to successfully identify and acquire sites which may
require change of use or which, due to their current size or usage, do not
present obvious development potential.
Chairman's statement
Introduction
After the most difficult year in your Company's short history, I am delighted to
be able to report that the recent placing, approved by shareholders on 19
November 2009, raised GBP6.9 million net of expenses, providing us with funds
for site development, working capital and debt reduction.
Whilst the property market remains difficult, we continue to believe that the
major projects in our portfolio will, in the fullness of time, create
significant shareholder value.
Financial results
The loss for the year amounted to GBP4,352,555 (2008: GBP2,880,514 profit); net
debt at the year end amounted to GBP30,511,234 (2008: GBP30,372,127).
Overview
It was apparent at the end of 2008 that the Company was starting to run short of
working capital. An immediate review of costs was undertaken and, as a result, a
significant reduction in employee headcount was made in the spring of 2009 along
with other cost cutting measures.
In October 2009, we undertook a placing at a discounted price of 5p per share,
with the aim of raising a minimum of GBP5.5 million before costs. I am pleased
to be able to advise shareholders that this issue was oversubscribed and raised
slightly in excess of GBP6.9 million net of expenses. The terms of the placing
were approved by shareholders on 19 November. Rob Lloyd, the Company's Chief
Executive Officer, underpinned the issue with a cash subscription of GBP800,000.
During the course of the year, he also confirmed the waiver of his profit
sharing arrangement, on the Corus, Birkwood and Driffield sites, agreed by
shareholders in October last year, in return for subscription rights over new
equity to the value of GBP1.4 million. This consideration was supported by an
independent report prepared specifically for the Company for this purpose by PKF
(UK) LLP. Mr Lloyd also agreed to the conversion of his director's loan account
in the amount of GBP1.63 million. Together with senior members of staff, I have
also subscribed in the placing.
The combination of the two elements of cash raised and debt for equity
conversion have significantly improved the shape of the Group's balance sheet
and materially increased its net assets. As a consequence of the placing, Mr
Lloyd's holding has been diluted down from 47.7% to 36.6%. The placing has also
added a significant number of new institutional and private shareholders and
their support is warmly welcomed.
Residential properties
In 2008, the Company recognised the approach of a substantial downturn in the
residential property market and, as a consequence, cut its new-build target from
300 new units down to 70. The effect of this decision has meant that we have
minimised our costs and exposure in this area. We now have 14 completed units
remaining and these are currently being marketed. Despite these measures,
selling prices have been significantly lower than in previous years and in some
cases we have undertaken sales on a shared equity basis. The major problem that
has faced your Company and indeed our immediate peers, throughout the year under
review, has been the unwillingness of lenders to provide funds to potential
buyers.
As a result, your Board has determined that a re-entry into residential house
building on a speculative basis is inappropriate at the present time due to the
high risks involved. For the foreseeable future, we shall limit our involvement
to the construction of affordable housing in partnership with Registered Social
Landlords. This sector, by its very nature, has a guaranteed end user and exit.
With this in mind, we are currently applying for Preferred Developer Status with
the Homes and Communities Agency. We are currently working with Pembroke Housing
Association on the construction of 31 affordable homes at Letterston in South
Wales, 12 at Hook in Haverfordwest and also on 4 units in Cardigan where we are
working with Tai Cantref.
Investment properties
At the present time, we own only a small number of investment properties,
amongst them our Corus flagship project at Workington and the Menzies
Distribution centre in Sheffield. Your Board will, however, seek to take
advantage of further opportunities with co-investment partners.
Major projects
Despite the difficult market conditions, the Company has made significant
progress in respect of its flagship projects outlined below. The Company remains
committed to unlocking significant value from its portfolio of brownfield land
at a time when many volume house builders are beginning to restock land banks.
Our efforts with regard to planning and subsequent sell premiums remain focused
on the demands of commercial property developers.
Corus
On 31 March 2009, we obtained a resolution to grant planning consent for a mixed
use development, subject only to a section 106 agreement, on our 77 acre
flagship site at Workington in Cumbria. Our ability to reach this point within
16 months of acquiring the site is a tribute to our in-house planning team and,
in particular, to our Development Director, Ian Arnott, without whose dedicated
efforts this would not have been possible. Still considered to be an investment
property, the Corus site has yet to go through a number of further stages,
including remediation and the construction of appropriate infrastructure, before
development can commence.
We are also pleased to have secured a 50% interest in an option over a further
265 acres of land to the north of our existing site. With our joint venture
partners, we have the right to acquire this land at its present, pre-planning
value, at any time before 31 December 2010.
Birkwood
We have also been able to secure a resolution to grant planning permission on
our 83 acre former NHS hospital site at Lesmahagow, some 25 miles south of
Glasgow. The consent, on this parkland site with its Grade B listed building,
will be for 165 dwellings and a hotel. Interest is already being shown by a
number of property developers in the building and we are hopeful that this will
lead to a completion sometime in 2010. Disposal of the rest of the site will be
dependent upon a recovery of interest in residential development but we shall be
actively marketing the site to a number of potentially interested parties.
Paignton
On 3 December 2009, we received notification from the administrator of Modus
(Paignton) Limited that our offer to acquire the 24 acre Bookham Technology Park
had been accepted and also that our application for funding from Bank of Ireland
had been approved. Bank of Ireland has set a deadline of 28th February 2010 for
exchange of contracts and has issued outline terms and conditions of funding.
These have yet to be agreed in full by the Company and, in addition, completion
will be dependent upon the identification of one or more co-investment partners.
Banks
Our banks have supported us through this very difficult period and on behalf of
the Company, I would like to thank them for continuing to do so.
Going concern
The Directors have prepared the financial statements on a going concern basis.
The ability of the Company and the Group to continue as a going concern is
dependent upon the continuing support of its banks.
Under company law, the Company's Directors are required to consider whether it
is appropriate to prepare the financial statements on the basis that the Group
and the Company are going concerns. The Group has support from its banks on its
overdrafts and project loans until at least 30 September 2010. However, given
the current uncertainties of both the financial and property markets, the
Group's need to reduce its debt profile and to maintain adequate working
capital, the Directors have concluded that these conditions represents a
material uncertainty which could affect the Company's and the Group's ability to
continue as a going concern. After making enquiries and considering the
uncertainties outlined above, the Directors have a reasonable expectation that
the Company and the Group will have adequate resources to continue in
operational existence for the foreseeable future. For these reasons, they
continue to adopt the going concern basis in preparing the annual report and
financial statements.
Going concern is also further discussed in the accounting policies.
Board changes
I would like to pay tribute to both non-executive directors, who stood down
earlier this year. Sir Leslie Young, in his capacity as non-executive chairman,
and Suki Kalirai were consistently supportive and both played a valuable role
during their time in office. I thank both of them, on behalf of the Company, for
the contribution they made.
Inevitably this leads me to the fact that at the present time the Company has no
non-executive directors. Now that the Company's refinancing has been completed,
we shall seek to appoint new non-executive directors. Your Board accepts its
full responsibility for compliance with corporate governance and the Combined
Code in this respect.
The future
We are consistently told that the green shoots of recovery are appearing. I
believe that, if this is the case, recovery may well be long and slow. However,
Eatonfield is now well placed to unlock significant potential from its land
bank. We shall need to be judicious and prudent in the use of our newly gained
resources and shall seek to deliver shareholder value in due course.
Finally, may I extend my grateful thanks to all my colleagues at Eatonfield who,
without exception, have made me welcome. I know that they have worked tirelessly
throughout an extremely difficult year and I sincerely hope that their efforts,
as well as our supportive shareholders, will be well rewarded.
Paul Williams
Chairman
9 December 2009
Group Income Statement
For the year ended 30 June 2009
+--------------------------------------------------+----------+-------------+---------------+
| | | 2009 | 2008 |
+--------------------------------------------------+----------+-------------+---------------+
| | Notes | GBP | GBP |
+--------------------------------------------------+----------+-------------+---------------+
| Revenue | | 8,455,643 | 10,060,072 |
+--------------------------------------------------+----------+-------------+---------------+
| Direct costs | | (9,131,019) | (11,987,657) |
+--------------------------------------------------+----------+-------------+---------------+
| Inventory losses | | (3,800,237) | (5,098,561) |
+--------------------------------------------------+----------+-------------+---------------+
| Trading loss | | (4,475,613) | (7,026,146) |
+--------------------------------------------------+----------+-------------+---------------+
| Investment property revaluation gains | | 4,377,343 | 14,236,254 |
+--------------------------------------------------+----------+-------------+---------------+
| Administration expenses | | (2,805,966) | (2,469,879) |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit from operations | | (2,904,236) | 4,740,229 |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit on disposal of plant and equipment | | (20,436) | 122 |
+--------------------------------------------------+----------+-------------+---------------+
| Share of result from joint venture | | (55,185) | (153,078) |
+--------------------------------------------------+----------+-------------+---------------+
| Other operating income | | 10,621 | - |
+--------------------------------------------------+----------+-------------+---------------+
| Finance income | | 51,009 | 66,703 |
+--------------------------------------------------+----------+-------------+---------------+
| Finance costs | | (1,370,666) | (616,379) |
+--------------------------------------------------+----------+-------------+---------------+
| Profit share relinquishment | | (1,400,000) | - |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit before taxation | | (5,688,893) | 4,037,597 |
+--------------------------------------------------+----------+-------------+---------------+
| Income tax credit/(expense) | | 1,336,338 | (1,157,083) |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit for the period | | (4,352,555) | 2,880,514 |
+--------------------------------------------------+----------+-------------+---------------+
| | | | |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit attributable to equity holders of | | (4,352,555) | 2,880,514 |
| the parent company | | | |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit per share - basic (p) | 4 | (18.87) | 12.50 |
+--------------------------------------------------+----------+-------------+---------------+
| (Loss)/Profit per share - diluted (p) | 4 | (18.87) | 12.45 |
+--------------------------------------------------+----------+-------------+---------------+
The results for the period are derived from continuing activities.
Group Balance Sheet
As at 30 June 2009
+----------------------------------------------+-----+--------------+-------------+
| | | 2009 | 2008 |
+----------------------------------------------+-----+--------------+-------------+
| | | GBP | GBP |
+----------------------------------------------+-----+--------------+-------------+
| Assets | | | |
+----------------------------------------------+-----+--------------+-------------+
| Non?current assets | | | |
+----------------------------------------------+-----+--------------+-------------+
| Investment properties | | 22,306,626 | 19,755,000 |
+----------------------------------------------+-----+--------------+-------------+
| Property, plant and equipment | | | 1,019,825 |
| | | 57,186 | |
+----------------------------------------------+-----+--------------+-------------+
| Investment in joint ventures: | | | |
+----------------------------------------------+-----+--------------+-------------+
| Share in joint venture | | | (160,165) |
| | | (215,349) | |
+----------------------------------------------+-----+--------------+-------------+
| Deferred taxation | | 1,356,880 | - |
+----------------------------------------------+-----+--------------+-------------+
| | | 23,505,343 | 20,614,660 |
+----------------------------------------------+-----+--------------+-------------+
| Current assets | | | |
+----------------------------------------------+-----+--------------+-------------+
| Inventories | | 19,307,394 | 25,363,572 |
+----------------------------------------------+-----+--------------+-------------+
| Assets held for resale | | 976,154 | - |
+----------------------------------------------+-----+--------------+-------------+
| Income taxation recoverable | | | 860,350 |
| | | 104,005 | |
+----------------------------------------------+-----+--------------+-------------+
| Trade and other receivables | | 5,103,810 | 6,057,584 |
+----------------------------------------------+-----+--------------+-------------+
| Cash and cash equivalents | | 1,815,376 | 1,734,697 |
+----------------------------------------------+-----+--------------+-------------+
| | | 27,306,739 | 34,016,203 |
+----------------------------------------------+-----+--------------+-------------+
| Total assets | | 50,812,082 | 54,630,863 |
+----------------------------------------------+-----+--------------+-------------+
| | | | |
+----------------------------------------------+-----+--------------+-------------+
| Equity and liabilities | | | |
+----------------------------------------------+-----+--------------+-------------+
| Equity | | | |
+----------------------------------------------+-----+--------------+-------------+
| Issued capital | | 2,306,478 | 2,306,478 |
+----------------------------------------------+-----+--------------+-------------+
| Share premium | | 8,218,939 | 8,218,939 |
+----------------------------------------------+-----+--------------+-------------+
| Merger reserve | | (1,499,000) | (1,499,000) |
+----------------------------------------------+-----+--------------+-------------+
| Share?based payment reserve | | - | 15,859 |
+----------------------------------------------+-----+--------------+-------------+
| Retained earnings | | 3,337,152 | 7,689,707 |
+----------------------------------------------+-----+--------------+-------------+
| Total equity attributable to equity holders | | 12,363,569 | 16,731,983 |
| of the parent | | | |
+----------------------------------------------+-----+--------------+-------------+
| Non?current liabilities | | | |
+----------------------------------------------+-----+--------------+-------------+
| Deferred taxation | | 3,068,879 | 2,800,614 |
+----------------------------------------------+-----+--------------+-------------+
| Obligations under finance leases | | | 39,280 |
| | | 25,790 | |
+----------------------------------------------+-----+--------------+-------------+
| Financial liabilities | | 1,123,570 | 15,309,920 |
+----------------------------------------------+-----+--------------+-------------+
| Other liabilities | | 400,000 | - |
+----------------------------------------------+-----+--------------+-------------+
| | | 4,618,239 | 18,149,814 |
+----------------------------------------------+-----+--------------+-------------+
| Current liabilities | | | |
+----------------------------------------------+-----+--------------+-------------+
| Financial liabilities | | 29,361,049 | 16,740,001 |
+----------------------------------------------+-----+--------------+-------------+
| Trade and other payables | | 4,453,025 | 2,991,442 |
+----------------------------------------------+-----+--------------+-------------+
| Obligations under finance leases | | | 17,623 |
| | | 16,200 | |
+----------------------------------------------+-----+--------------+-------------+
| | | 33,830,274 | 19,749,066 |
+----------------------------------------------+-----+--------------+-------------+
| Total liabilities | | 38,448,513 | 37,898,880 |
+----------------------------------------------+-----+--------------+-------------+
| Total equity and liabilities | | 50,812,082 | 54,630,863 |
+----------------------------------------------+-----+--------------+-------------+
Group Cash Flow Statement
For the year ended 30 June 2009
+--------------------------------------------------+-------------------+--------------+
| | 2009 | 2008 |
+--------------------------------------------------+-------------------+--------------+
| | GBP | GBP |
+--------------------------------------------------+-------------------+--------------+
| (Loss)/Profit before taxation | (5,688,893) | 4,037,597 |
+--------------------------------------------------+-------------------+--------------+
| Goodwill impairment | - | 72,000 |
+--------------------------------------------------+-------------------+--------------+
| Net finance costs | 2,719,657 | 549,676 |
+--------------------------------------------------+-------------------+--------------+
| Loss/(profit) on disposal of property, plant and | 20,436 | (122) |
| equipment | | |
+--------------------------------------------------+-------------------+--------------+
| Share of joint venture operating result | 55,185 | 153,078 |
+--------------------------------------------------+-------------------+--------------+
| Share?based compensation | | 1,638 |
| | (15,859) | |
+--------------------------------------------------+-------------------+--------------+
| Depreciation | 42,563 | 85,719 |
+--------------------------------------------------+-------------------+--------------+
| Investment property revaluation gains | (4,377,343) | (14,236,254) |
+--------------------------------------------------+-------------------+--------------+
| Decrease in inventories | 8,179,553 | 1,218,829 |
+--------------------------------------------------+-------------------+--------------+
| Decrease in trade and other receivables | 953,774 | 12,497,694 |
+--------------------------------------------------+-------------------+--------------+
| (Decrease)/increase in trade and other payables | (250,439) | 606,900 |
+--------------------------------------------------+-------------------+--------------+
| Net cash generated from operations | 1,638,634 | 4,986,755 |
+--------------------------------------------------+-------------------+--------------+
| Income taxation | 1,004,067 | (913,547) |
+--------------------------------------------------+-------------------+--------------+
| Cash generated from operating activities | 2,642,701 | 4,073,208 |
+--------------------------------------------------+-------------------+--------------+
| | | |
+--------------------------------------------------+-------------------+--------------+
| Investing activities | | |
+--------------------------------------------------+-------------------+--------------+
| Acquisition of investment properties | (439,657) | (5,308,429) |
+--------------------------------------------------+-------------------+--------------+
| Acquisition of property, plant and equipment | - | (153,449) |
+--------------------------------------------------+-------------------+--------------+
| Proceeds from the disposal of plant and | | 109,002 |
| equipment | 65,217 | |
+--------------------------------------------------+-------------------+--------------+
| Finance income received | 51,009 | 66,703 |
+--------------------------------------------------+-------------------+--------------+
| Cash used in investing activities | (323,431) | (5,286,173) |
+--------------------------------------------------+-------------------+--------------+
| | | |
+--------------------------------------------------+-------------------+--------------+
| Financing | | |
+--------------------------------------------------+-------------------+--------------+
| Equity dividends paid | - | (345,000) |
+--------------------------------------------------+-------------------+--------------+
| Net proceeds from issue of ordinary shares | - | 43,399 |
+--------------------------------------------------+-------------------+--------------+
| Net movement in short term borrowings | 12,621,048 | 905,243 |
+--------------------------------------------------+-------------------+--------------+
| Net movement in long term borrowings | (13,786,349) | 1,922,175 |
+--------------------------------------------------+-------------------+--------------+
| Finance costs paid | | (616,379) |
| | (1,058,377) | |
+--------------------------------------------------+-------------------+--------------+
| Repayment of finance leases | | (7,493) |
| | (14,913) | |
+--------------------------------------------------+-------------------+--------------+
| Cash (used in)/generated from financing | (2,238,591) | 1,901,945 |
| activities | | |
+--------------------------------------------------+-------------------+--------------+
| | | |
+--------------------------------------------------+-------------------+--------------+
| Increase in cash and cash equivalents | 80,679 | 688,980 |
+--------------------------------------------------+-------------------+--------------+
| Opening cash and cash equivalents | 1,734,697 | 1,045,717 |
+--------------------------------------------------+-------------------+--------------+
| Closing cash and cash equivalents | 1,815,376 | 1,734,697 |
+--------------------------------------------------+-------------------+--------------+
Group Statement of Changes in Equity
For the year ended 30 June 2009
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| | Issued | Share | Merger | Share?based | Retained | Total |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| | capital | premium | reserve | compensation | earnings | equity |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| | GBP | GBP | GBP | GBP | GBP | GBP |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Balance | 2,300,000 | 8,182,018 | (1,499,000) | 14,221 | 5,154,193 | 14,151,432 |
| at 1 | | | | | | |
| July | | | | | | |
| 2007 | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Profit | - | - | - | - | 2,880,514 | 2,880,514 |
| for the | | | | | | |
| period | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Dividend | - | - | - | - | (345,000) | (345,000) |
| paid | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Issue of | 6,478 | 36,921 | - | - | - | 43,399 |
| shares | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Share?based | - | - | - | 1,638 | - | 1,638 |
| compensation | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Balance | 2,306,478 | 8,218,939 | (1,499,000) | 15,859 | 7,689,707 | 16,731,983 |
| as at 30 | | | | | | |
| June | | | | | | |
| 2008 | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Loss for | - | - | - | - | (4,352,555) | (4,352,555) |
| the | | | | | | |
| period | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Share?based | - | - | - | (15,859) | - | (15,859) |
| compensation | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
| Balance | 2,306,478 | 8,218,939 | (1,499,000) | - | 3,337,152 | 12,363,569 |
| at 30 | | | | | | |
| June | | | | | | |
| 2009 | | | | | | |
+--------------+------------+-----------+-------------+--------------+-------------+-------------+
Issued capital
The issued capital account includes the par value for all shares issued.
Share premium account
This comprises the premium over nominal value on issued shares. The use of this
reserve is restricted by the Companies Act 2006.
Merger reserve
The Group reconstruction before flotation in 2006 was accounted for in
accordance with the principles of merger accounting.
Share-based compensation
This reflects the expected value to the Company of options issued to date upon
vesting.
Total Equity
This is the equity attributable to the members of the parent.
1. General information
The preliminary financial information does not constitute full accounts within
the meaning of section 434 of the Companies Act 2006 but is derived from
accounts for the years ended 30 June 2009 and 30 June 2008. These figures are
audited. The preliminary announcement is prepared on the same basis as set out
in the statutory accounts for the year ended 30 June 2009. The auditors have
issued an audit report modified by the inclusion of an emphasis of matter
paragraph which highlights the existence of a material uncertainty that casts
doubt on the company's and group's ability to continue as a going concern. Their
opinion is not qualified in this respect. Further information is disclosed in
the going concern paragraph below.
Statutory accounts for the year ended 30 June 2008 have been filed with the
Registrar of Companies. The Auditors reported on those accounts; their report
was unqualified, and did not contain a statement under s237(2) or (3) Companies
Act 1985 but did draw attention to matters by way of emphasis without qualifying
their report.
While the financial information included in this preliminary announcement has
been prepared in accordance with the recognition and measurement criteria of
International Financial Reporting Standards (IFRS), as adopted by the European
Union (EU), this announcement does not in itself contain sufficient information
to comply with IFRSs.
Eatonfield Group plc is incorporated and domiciled in the United Kingdom.
2. GOING CONCERN
Since the year end, by way of a placing, the Group has raised GBP6.9 million,
part of which has been utilised in reducing overdraft facilities and secured
loans. However, the Directors consider that the greatest risk facing the Group,
given the state of the financial markets and current economic uncertainty, and
more particularly because a number of its development projects are of a long
term nature, is the uncertainty as to whether it will be able to obtain further
debt funding. This could impact upon the Group's ability to bring such projects
to a profitable conclusion.
The Directors have also prepared cash flow projections to the end of December
2010. These forecasts indicate that the Group should have sufficient working
capital for that period, taking into account a realistic approach to income
generation and control of costs.
The Group has two overdraft facilities to be repaid respectively by 30 September
2010 and 30 October 2010. In addition, the Group has a number of loans secured
on particular assets, which are repayable at the earlier of the sale or at the
end of a specific term.
However, should any overdraft facility not be renewed or other loan facility
become payable prior to the sale of the related asset, and in the absence of
alternative funding sources, the Group would be required to dispose of assets to
realise cash to meet its debts as they fall due. Given current market
conditions, there is a risk that the assets would take an extended period to
realise cash, which might also be less than their book values. As a result,
should the Group be unable to repay its bank borrowings from asset sales or the
refinancing of existing assets, a material uncertainty exists which casts doubt
over the Group's ability to continue as a going concern.
The Directors have concluded that after making the appropriate enquiries and
taking into consideration the uncertainties outlined above, there is a
reasonable expectation that the Group and the Company have sufficient resources
to continue in operational existence for the foreseeable future. For this
reason, the financial statements have been prepared on a going concern basis.
3. SEGMENTAL REPORTING
Revenue, (loss)/profit before taxation and net assets were all derived from the
Group's principal activity of property development. All operations are carried
out in the United Kingdom.
4. (LOSS)/EARNINGS PER SHARE
Earnings and the number of shares used in the calculations of (loss)/earnings
per share are set out below:
+----------------------------------------------------+-------------+-----------+
| | 2009 | 2008 |
+----------------------------------------------------+-------------+-----------+
| | GBP | GBP |
+----------------------------------------------------+-------------+-----------+
| (Loss)/profit for the year | (4,352,555) | 2,880,514 |
+----------------------------------------------------+-------------+-----------+
+----------------------------------------------------+------------+------------+
| | 2009 | 2008 |
+----------------------------------------------------+------------+------------+
| | Number | Number |
+----------------------------------------------------+------------+------------+
| Weighted average number of shares in issue: | | |
+----------------------------------------------------+------------+------------+
| For basic (loss)/earnings per share | 23,064,775 | 23,051,820 |
+----------------------------------------------------+------------+------------+
| Exercise of share options | - | 93,369 |
+----------------------------------------------------+------------+------------+
| For fully diluted (loss)/earnings per ordinary | 23,064,775 | 23,145,189 |
| share | | |
+----------------------------------------------------+------------+------------+
+-----------------------------------------------------+----------+---------+
| | 2009 | 2008 |
+-----------------------------------------------------+----------+---------+
| | Pence | Pence |
+-----------------------------------------------------+----------+---------+
| (Loss)/earnings per share: | | |
+-----------------------------------------------------+----------+---------+
| Basic | (18.87) | 12.50 |
+-----------------------------------------------------+----------+---------+
| Diluted | (18.87) | 12.45 |
+-----------------------------------------------------+----------+---------+
5. POST BALANCE SHEET EVENTS
On 15 September 2009, warrants to subscribe for up to 800,000 ordinary shares
were issued to West Register (Investments) Limited, a sister company of RBS, at
a price of 5p per share. These warrants are valid until 16 September 2014.
On 28 September 2009 Haycroft Farm, a property owned by Rob Lloyd, the Company's
Chief Executive Officer, was sold to Eatonfield Developments Ltd for GBP3.3m
(based on a valuation by Mason Owen, Chartered Surveyors, on 26 March 2009). The
proceeds of sale (after mortgage redemption) were credited to Mr Lloyd's
Director's loan account. Subsequently Eatonfield Developments Limited took out a
loan of GBP2.2m with RBS using Haycroft Farm as security.
On 19 November, the Company undertook a capital reorganisation, whereby the
existing ordinary shares of the Company were subdivided and converted into one
new ordinary share and one deferred share. The nominal value of the shares was
at the same time amended from 10p to 1p. Authorised but unissued existing
ordinary shares were also subdivided into 10 new ordinary shares. Each new
ordinary share has the same rights (including voting and dividend rights and
rights on a return of capital) as each existing ordinary share had prior to the
capital reorganisation .The deferred shares created under the capital
reorganisation have no voting or dividend rights and, on a return of capital,
will have the right to receive the amount paid up thereon only after the holders
of the new ordinary shares have received, in aggregate, the amount paid up
thereon together with the sum of GBP10,000,000 per new ordinary share.
On the same date, by way of a placing, 207,820,000 new ordinary shares of 1
penny were issued at a price of 5p per share, raising GBP6.9 million net of
costs. As a result of the placing, warrants were issued to the Company's brokers
over 6,531,000 ordinary shares at a price of 5p per share. These warrants are
valid until 27 October 2011. In addition, on the same date, warrants to
subscribe for 11,835,461 ordinary shares were issued to West Register
(Investments) Limited at a price of 5p per share. These warrants are valid until
16 September 2014.
Also on 19 November, 1,000,000 ordinary shares were issued to Evolution
Securities Limited in consideration for advice in connection with the placing
and warrants to subscribe for up to 700,000 ordinary shares at a price of 15p
were issued to Paul Brett and Leslie Allen-Vercoe as part of the joint venture
agreement entered into on 17 September 2009. These warrants are valid until 18
November 2010.
On 25 November 2009 the Company announced that it had secured a 50% interest in
an option to acquire 265 acres of land situated immediately to the north of the
77 acre Corus Rail site already owned by the Group. That option is currently
held by Port Derwent LLP ("Port Derwent") and upon its exercise, which must take
place no later than 31 December 2010, the site will be acquired by Port Derwent
Workington Limited, a company in which Port Derwent and the Group will be equal
shareholders.
6. basis of the preliminary announcemenT
The board of directors of Eatonfield Group plc approved the Preliminary Results
on 9 December 2009.
The statutory accounts for the year ended 30 June 2009 will be delivered to the
Registrar of Companies before the Annual General Meeting ("AGM"). Further copies
will be available to the public, free of charge, at the Company's registered
office, Haycroft Farm, Peckforton Hall Lane, Spurstow, Tarporley CW69TF and the
Company's website at www.eatonfield.com.
The statutory accounts together with the notice of AGM will be posted to
shareholders today. The AGM will be held at 10am on 31 December 2009 at the
Company's registered office.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EADANEFANFFE
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