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| Date/Time | Headline | Source |
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| 26-02-10 | RNS |
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RNS Number : 7629H Formation Group PLC 26 February 2010 Formation Group PLC ('Formation' or the 'Company') Result of Annual General Meeting ('AGM') The Directors of Formation confirm that at the Company's AGM, held earlier today, all Resolutions were duly approved. For more information please contact: Desmond Khan Finance Director and Company Secretary, Formation Group PLC - 020 7920 7590 NOMAD to Formation Group PLC; Ross Andrews / Tom Rowley, Zeus Capital Ltd - 0161 831 1512 This information is provided by RNS The company news service from the London Stock Exchange END
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| 16-02-10 | AFX UK Focus |
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LONDON, Feb 16 (Reuters) - Formation Group Plc:
officer ((London Equities Newsroom; +44 20 7542 7717)) (For more news, please click here)
COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. More |
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| 16-02-10 | RNS |
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RNS Number : 2027H Formation Group PLC 16 February 2010 Formation Group PLC Directorate Change Formation Group PLC (the "Group") announces the appointment of Mr David Anthony Kennedy Jr as the Group's Chief Executive Officer. David, 31, will join the board with immediate effect. Noel O'Carroll, who has been the Company's interim Chief Executive Officer since July 2009, will remain on the board as Managing Director of the Property Division. John Lawrence, Non Executive Chairman, said: "The appointment of David reflects the Group's focus on its property businesses. David brings significant experience in the property industry which we believe will benefit the Group in the future". This announcement sets out the disclosures required pursuant to Schedule 2, paragraph (g) of the AIM Rules for Companies in respect of that appointment. David is currently a director of the following companies: Albus Property Ltd, Beckett College Group Ireland Limited, Beckett Education Group UK Limited, Beckett University Group Limited, Bern Investments Limited, Brier Holdings Limited, Calderon Limited, Ceva International Limited, Chianti Holdings Limited, Farway Trading SA, Gulf Piling Limited, Goldbrown Limited, Hallfield Real Estates Ltd, Halton Securities Limited, Kedai Limited, Kharla Property Holdings Limited, Magnolia Services Limited, Mangrove Securities Limited, Monticello Trading Limited, Murex Properties Limited, Muscadet Properties Limited, Nedville Consultants Limited, Pearl Properties Limited, Solent Equities Limited, Spokane Trading Limited, Stilton Limited, Streetwise Limited, Tandridge Holdings Limited, Truelex Holdings Limited, Vuillard Holdings Limited, Columbia Estates Management (IE) Limited, Derk Estates Limited, Dublin Corporate Cabs Limited, Eimur Limited, Lonadale Limited, Aquarelle Holdings Limited, Banleman Properties Limited, Blines Trading Limited, Columbia Design & Build (C.I.) Limited, Columbia Estates (C.I.) Limited, Cheapside Stores Limited, Cliffview Properties Limited, DK Holdings Limited, DAK Holdings Limited, Hanau Limited, Janvrin Properties (St Helier) Limited, LKC Holdings Limited, Mabrook Properties Limited, Moonshine Holdings Limited, No 1 Parade Holdings Limited, Rockwood Holdings Limited, PTK Consultants Limited, Tracent Limited, JGW Limited, Beckett College (London) Limited, Imperando (UK) Limited David has also within the last five years been a director of the following companies: Aarau financial Technology International Limited, Akay Management Services Limited, Alexandra Park Limited, Courtside Services Limited, Mayflower Industries Limited, Vesconte Properties Limited, Regal Properties Inc. David does not hold any shares in the Group directly but is interested in shares of the Group indirectly through the following: David is a director of Streetwise Limited which holds 74,747,354 Ordinary Shares in the Group (representing approximately 36.64 per cent. of the issued share capital). Tulip Trust owns 100 per cent of the issued share capital of Streetwise Limited. David is a potential beneficiary of Tulip Trust. Fitel Nominees Limited holds 30,822,813 Ordinary Shares in the Group (representing approximately 15.11 per cent. of the issued share capital) as nominee for David Kennedy Sr who, in turn, holds them in trust for Tulip Trust. As noted above, David Kennedy Jr is a potential beneficiary of Tulip Trust. There is no other information which needs to be discussed pursuant to Schedule 2, paragraph (g) of the AIM Rules for Companies. Ends Enquiries
This information is provided by RNS The company news service from the London Stock Exchange END
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| 01-02-10 | RNS |
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This news article is displayed preformatted as it may contain results tables
RNS Number : 4046G
Formation Group PLC
01 February 2010
FORMATION GROUP PLC
('Formation' or 'the Group')
Preliminary Results for the year ended 31 August 2009
Business Highlights
* Disposal of a number of Group subsidiary undertakings to certain of the Group's existing management for a total cash consideration of £16.5 million, representing approximately 7.47 pence per share - a premium of approximately 36% of the mid market price at the time of the announcement
* Post year end disposal of certain assets of the Group's wealth management businesses for a total anticipated consideration payable over a 3 to 5 year period of approximately £575,000. These disposals have resulted in the Group exiting it's loss making wealth management activities
* Agreement entered into with JV Finance Limited, to form JV Finance Ventures Limited in order to acquire the land at the Aldgate property development and in order to settle in full, the indebtedness owed to Heritable Bank's administrator
* Re-focused property business following the management buy-out
John Lawrence, Chairman of Formation said;
"This year has seen significant change within the Group. The decision by the board, and subsequent approval by shareholders, to accept an offer from certain of the Group's existing management team for five of the Group's nine subsidiaries was a significant point in the Group's history.
This decision, coupled with the exit from its wealth management businesses subsequent to the year end, has now enabled the Group to focus on its property business.
These decisions were not taken lightly and whilst the composition of the Group's business interests has changed substantially, the board considers these decisions to be in the long term best interests of all stakeholders.
The Group faced a significant challenge within its property business following the collapse of Heritable Bank and the well documented knock-on effect this event had on the property development at Commercial Street, above Aldgate East tube station, London. This development was part funded through the issue of Junior Unsecured Loan Notes and Subordinated Junior Unsecured Loan Notes to retail investors, including clients of the Group's wealth management businesses. Certain of these loan notes carry a guarantee from the Group. These banking events are unprecedented and whilst the development works had stalled for over 12 months and with no obvious resolution in sight, it was incumbent upon the board to look closely at how best to protect the interests of all its stakeholders; shareholders, clients and the Loan Note holders.
Enquiries:
Formation Group PLC - Noel O'Carroll; Interim Chief Executive Officer - 020 7920 7590
NOMAD to Formation Group PLC; Zeus Capital Limited - Ross Andrews / Tom Rowley - 0161 831 1512
CHAIRMAN'S STATEMENT
This year has seen significant change within the Group. The decision by the board, and subsequent approval by shareholders, to accept an offer from certain of the Group's existing management team for five of the Group's nine subsidiaries was a significant point in the Group's history.
This decision, coupled with the exit from its wealth management businesses subsequent to the year end, has now enabled the Group to focus on its property business.
These decisions were not taken lightly and whilst the composition of the Group's business interests has changed substantially, the board considers these decisions to be in the long term best interests of all stakeholders.
The Group faced a significant challenge within its property business following the collapse of Heritable Bank and the well documented knock-on effect this event had on the property development at Commercial Street, above Aldgate East tube station, London. This development was part funded through the issue of Junior Unsecured Loan Notes and Subordinated Junior Unsecured Loan Notes to retail investors, including clients of the Group's wealth management businesses. Certain of these loan notes carry a guarantee from the Group. These banking events are unprecedented and whilst the development works had stalled for over 12 months and with no obvious resolution in sight, it was incumbent upon the board to look closely at how best to protect the interests of all its stakeholders; shareholders, clients and the Loan Note holders.
The MBO approach and resultant deal has better equipped the Group to tackle this key issue and I am pleased that we were recently able to announce a Joint Venture agreement with JV Finance Limited in order to take steps to complete the development by securing the land from Heritable's administrators. This deal saw JV Finance Ventures Limited agreeing to pay £11 million in full and final settlement of indebtedness of £32.9 million. Formation will pay 50% of this settlement figure with JV Finance Limited paying the remaining 50% with both sharing the development profit proceeds equally.
This still remains a challenging time for the Group and there remains much to do in order to complete the Aldgate development. Having re-focused the business post the MBO and having concluded the Asset deals within the business's wealth management division, our strategy and efforts have been firmly focused on the Aldgate development, and how we may resolve and realise value from this.
The next stage on the pathway to achieving this objective is to secure new, post Heritable Bank funding in order to build out the development. These discussions are now underway but could not have taken place until we reached agreement with the Bank's administrator. Once funding is in place, construction works can then re-commence. There has also been substantial sales interest for large parts of the development and given its location, the board remains optimistic that we will successfully navigate our way through this difficult situation.
The Board and Staff
This has understandably been a difficult and challenging period for the Group. I would firstly like to place on record my thanks to all board members and staff, past and present, for the manner in which both the MBO deal and subsequent wealth management disposals were conducted. As announced on 25 January 2010, I have decided not to put myself forward for re-election at the forthcoming AGM. I have enjoyed my 10 years with the Group immensely and wish the board all the very best for the future. Whilst I will serve my 12 months notice as the Group undertakes the search for my replacement, I would like to take this opportunity to place on record my thanks to our NOMAD; Zeus Capital, our lawyers; DLA Piper and our Auditors; Grant Thornton for their assistance and corporate advice. I also welcome Desmond Khan (FCCA) to the board. Desmond is the Finance Director of the Group's main trading subsidiary; Formation Design & Build. Desmond brings a wealth of property experience to the Group. Finally, our staff continue to put this business first and their effort and dedication continues to be highly valued and very much appreciated.
John E Lawrence MBE - Non-Executive Chairman 1 February 2010
INTERIM CHIEF EXECUTIVE OFFICER'S REPORT
Introduction
The unprecedented collapses in markets and institutions have, without doubt, been a dominant and limiting factor for the Group during the last twelve months. The potential contingent property liability linked to the Aldgate development (specifically the previously disclosed £11.6 million liability which is attached to certain Loan Notes provided by a number of retail investors), which in turn was dependent upon the bank funding agreement with Heritable Bank PLC, cast uncertainty over the Group.
However, the underlying performance of the Group's core management services, and selected other professional services led to a successful management buy-out ("MBO") of a number of Group subsidiary companies in August 2009. This, together with the sale post year end of the wealth management business, has resulted in a debt free, cash positive business with a sole focus on the property sector which is already showing signs of some recovery. There will doubtless be those who prosper from recent recessionary events, it is our objective to be one of those companies.
Results
The trading results for the year have been impacted by the sale of the MBO companies. For the year ended 31 August 2009, the Group revenue from continuing operations was £19.0 million (2008: £25.0 million) resulting in a loss before taxation and exceptional items from continuing operations of £2.9 million (2008: profit of £0.6 million).
Dividend
Historically the Group has always sought to reward shareholders by way of an annual dividend payment. Last year was the first time for some considerable time that we did not pay a dividend. This was after careful consideration set in context with the uncertainty we found ourselves in following the Administration of Heritable Bank PLC. Whilst that situation is yet to be fully resolved, the Directors, after careful consideration have decided not to pay a shareholder dividend. This decision will be revisited at the forthcoming Interim Results.
Business Overview
The Company is now a construction and property development/management business generating income through project developing/management of large scale building developments.
We are currently involved namely in four large schemes which are each at various stages of the planning/
development process. These schemes are:
(i) 15/17 Leman Street, London E1
Planning and preconstruction in connection with a 251 bed roomed hotel.
(ii) Clancy Quay, South Circular Road, Island bridge, Dublin, Ireland
Project management on the construction of 420 apartments, car parking, retail units and office space on Phase 1 (now nearing completion) of this large inner city mixed use development.
(iii) 52-58 Commercial Road, London E1
Project management on the fit out of approximately 1,500sqm of Education use within a recently completed building.
(iv) No.1 Commercial Street, London E1
Preconstruction procurement and planning applications in connection with the remobilization of a mixed use new build development incorporating 212 apartments, car parking and approximately 10,000sqm of various commercial uses.
Inevitably, this area of our business has, and will continue in the short term to come under pressure. Bank debt, so often a pre-requisite to large scale developments is in shorter supply with banks being more selective and aggressive with their terms. We are fortunate to have forged an inner London reputation in the construction sector and continue to focus on this geographical area which is undoubtedly seeing a quicker recovery than other areas of the country.
Development Updates
Various feasibility studies, small site management and architectural works in association with smaller planning applications continue as part of our routine business process. The four large developments which form the core of our committed business are progressing as follows.
* 15/17 Leman Street, London has been submitted for planning (251 bed hotel) with a decision anticipated in March 2010. A lease subject to planning has been signed by the developer with a hotel operator. Preconstruction design, liaison with engineers and specialist contractors has commenced in anticipation of an immediate start to construction works following receipt of a satisfactory planning approval.
* Clancy Quay, Dublin, Ireland is nearing the completion of Phase 1 of this large mixed use scheme in February 2010. The scheme has an original planning approval for 732 apartments, 194 bedroom hotel, 6,106sqm of various commercial and community uses plus basement car parking. It is unlikely that further phases of the development will commence in the foreseeable future due to the present economic environment. We are presently assisting the developer in finalising contractor's accounts, and compiling proposals for the future development/management of the various phases within the scheme.
* 52-58 Commercial Road, London E1. We have project managed and now completed the handover of the 142 apartments, live/work units, car parking and commercial spaces within this building. Presently we are project managing the fit-out of 1,500sqm of education space within the building. This we anticipate will complete by April 2010. Various planning applications for changes of use within the building are in hand. Further fit-out supervision is anticipated upon approval of the current applications. It is conceivable that our services may be required onsite until October 2010.
* No.1 Commercial Street, London E1. As disclosed previously, following the demise of Heritable Bank and suspension of construction works on site in October of 2008 the development was secured from the bank's administrators in December 2009. We are currently assisting the developer with various planning and construction amendments to meet the requirements of potential end users. Precontract enquiries and assistances to the developer on bank funding will commence shortly in anticipation of a site re-start later this year.
Risks and Uncertainties
Potential Property Liabilities
The administration order in relation to Heritable Bank PLC, first detailed within our Preliminary announcement in November 2008, resulted in uncertainty over a contingent underwriting liability in relation to the Aldgate development. The Group's current maximum liability under this arrangement remains £11.6 million.
However, the post balance sheet announcement on 14 December 2009, that Julius Properties Limited ("JPL") had reached agreement with the administrators of Heritable Bank plc regarding the Aldgate development, was an important development for the Group. JPL has agreed to pay the administrator £11 million in full and final settlement of the £32.9 million indebtedness.
Formation Group and its 50/50 joint venture party, JV Finance Limited, each agreed to inject £5.5 million into a joint venture, JV Ventures Limited, with the total of £11 million to be paid to JPL, in return for any profits generated from the Aldgate development.
The Board believes that the joint venture represents a significant and positive step forward towards the repayment of the loan note investors in the Aldgate development, which would in turn extinguish the Group's contingent liability.
Discussions will now commence with certain institutions to secure the requisite funding to enable the build out of the development. Once this funding has been secured, Formation Design & Build will be contractually engaged by the new joint venture company to project manage the onsite construction.
We will then be in a position to provide a completion timescale and liaise with all development investors to discuss what, if any impact, we expect on the timeline of loan note repayment. Under the terms of the existing loan note agreements a return is due to investors in August 2011.
Divested Business
As the Chairman has already explained, the last 12 months has seen a substantial refocus in the Group's activities. The recommendation by the board and subsequent approval by shareholders to dispose of certain non-property related businesses has however enabled the Group to become debt free with the cash reserves to enable it to participate in the Aldgate solution. Whilst it is of paramount importance to ensure we are in a position to repay the Loan Notes, we expect to financially benefit from the Joint Venture once the development is completed, sold and loan notes repaid. We would not have had this opportunity if the MBO had not taken place and we would be at significantly greater risk from the potential contingent liability perspective had this deal not concluded. In addition to the cash injection of over £16 million, the deal also saw the transfer of responsibility for the existing James Grant Media acquisition deferred consideration to the MBO team, representing a further saving of approximately £4.0 million to the Group.
Outlook
The business has undergone significant change within the last 12 months. Whilst it is undoubtedly better equipped as a debt free and cash positive business to tackle the challenges presented by the unprecedented collapse of Heritable Bank PLC, those challenges remain, albeit to a lesser extent given the post year end agreement reached with the Bank's administrators.
The outlook is best summarised as cautiously optimistic. Optimistically we will conclude the key development at Aldgate, honour the loan note guarantee from certain retail investors and we anticipate that the business will prosper from a property recovery.
Noel O'Carroll - Interim Chief Executive Officer
1 February 2010
Consolidated Income Statement
For the year ended 31 August Notes
2009 2
Continuing operations Revenue
Cost of sales 2009 2008
£'000 £'000
18,953 25,006
(15,911) (18,586)
Gross profit 3,042 6,420
Administrative expenses (5,477) (5,554)
Operating (loss)/profit from 2 (2,435) 866
continuing operations
Investment income 4 119
Finance costs (486) (319)
(Loss)/profit before taxation (2,917) 666
and exceptional items
Exceptional Items (17,824) -
(Loss)/profit before taxation (20,741) 666
Taxation 277 (224)
(Loss)/profit for the year (20,464) 442
from continuing operations
Discontinued operations
(Loss)/profit for the year 3 (6,307) 2,310
from discontinued operations
(Loss)/profit for the year (26,771) 2,752
Attributable to:
Equity holders of the parent (26,793) 2,703
Minority interests 22 49
(26,771) 2,752
(Loss)/earnings per share
From continuing operations
Basic 4 (9.56p) 0.21p
Diluted 4 (9.56p) 0.20p
From discontinued operations
Basic 4 (2.96p) 1.06p
Dilute 4 (2.96p) 1.04p
From continuing and
discontinued operations
Basic 4 (12.52p) 1.27p
Diluted 4 (12.52p) 1.24p
Consolidated Statement of Recognised Income and Expense
For the year ended 31 August 2009
2009 2008
£'000 £'000
(Loss)/profit for the year (26,771) 2,752
Exchange gain on foreign currency translation of foreign 44 40
operations
Total recognised income and expense for the year (26,727) 2,792
Attributable to:
Equity holders of the parent (26,749) 2,743
Minority interests 22 49
(26,727) 2,792
Consolidated Balance Sheet
31 August 2009
2009 2008
£'000 £'000
Non-current assets
Goodwill 10,805 47,409
Other intangible assets 3 18
Property plant and equipment 73 330
Non-current financial assets - 4,862
Deferred tax asset 229 135
11,110 52,754
Current assets
Inventories 22 2,222
Trade and other receivables 2,140 6,978
Cash and cash equivalents 15,154 4,028
17,316 13,228
Total assets 28,426 65,982
Current liabilities
Trade and other payables (4,958) (11,562)
Current income tax liabilities (536) (1,503)
Obligations under finance leases - (9)
Bank overdrafts and loans (7,010) (1,833)
(12,504) (14,907)
Net current assets/(liabilities) 4,812 (1,679)
Non-current liabilities
Trade and other payables - (3,605)
Obligations under finance leases - (8)
Bank loans - (4,010)
- (7,623)
Total liabilities (12,504) (22,530)
Net assets 15,922 43,452
Consolidated Balance Sheet cont*
31 August 2009
2009 2008
£'000 £'000
Equity
Share capital 2,205 2,205
Share premium account 2,106 2,106
Treasury shares (602) (102)
Capital redemption reserve 61 61
Merger reserve 11,265 20,326
Currency reserve 94 50
Share option reserve 55 324
Retained earnings 738 18,142
Total equity attributable to the parent's shareholders 15,922 43,112
Minority interests - 340
Total equity 15,922 43,452
Consolidated Cash Flow Statement
For the year ended 31 August
2009
Notes
Operating activities 2009 2008
Cash (used in)/generated by £'000 £'000
operations 6
Income taxes paid
Interest paid
(38) 3,153
(1,239) (1,036)
(432) (219)
Net cash (outflow)/inflow from (1,709) 1,898
operating activities
Investing activities
Interest received 59 194
Proceeds on disposal of 1 -
property, plant and equipment
Purchases of property, plant (89) (113)
and equipment
Deferred consideration paid (3,310) (1,190)
Acquisition of subsidiaries - (9,418)
Cash acquired with - 2,688
subsidiaries
Acquisition expenses - (878)
Net proceeds on disposal of 16,477 1,007
subsidiary companies
Fees and costs relating to the (295) -
disposal of subsidiaries
Cash disposed of with (702) -
subsidiary companies
Net cash generated by/(used 12,141 (7,710)
in) investing activities
Financing activities
Dividends paid - (235)
Purchase of own shares (500) (207)
Net proceeds from sale of own - 828
shares
New loans 2,000 6,000
Loan repayments (833) (157)
Repayments of obligations (17) (34)
under finance leases
Net cash generated by 650 6,195
financing activities
Net increase in cash and cash 11,082 383
equivalents
Cash and cash equivalents at 4,028 3,605
the beginning of the year
Effect of foreign exchange 44 40
rate changes
Cash and cash equivalents at 15,154 4,028
the end of the year
FORMATION GROUP PLC
Notes to the preliminary announcement
For the year ended 31 August 2009
1. Basis of Preparation
The financial information set out in this announcement does not constitute the Company's statutory accounts for the years ended 31 August 2009 or 31 August 2008 but is derived from those accounts. Copies of the Company's audited statutory accounts for the year ended 31 August 2009 will be despatched to shareholders shortly.
The financial statements have been prepared on a going concern basis. The Group has significant surplus cash balances as at 31 August 2009, generated from the sale of certain subsidiary undertakings during the year. In addition greater certainty has been achieved post year end regarding the completion of the Aldgate property development.
The Directors have prepared working capital forecasts for the period to 31 January 2011. The working capital forecasts assume that no cash outflows in respect of the loan note guarantee will occur.
The Directors are satisfied that the forecast level of trading performance and cash flows are achievable and that the Group will therefore be able to continue to operate for the foreseeable future.
The auditor's report contained in the 2008 statutory accounts included an emphasis of matter paragraph, and did not include any further statements under section 237 (2) or (3) of the Companies Act 1985.
Whilst the information included in this announcement has been computed in accordance with International Financial Reporting Standards (IFRS), this announcement in itself does not include sufficient information to comply with IFRS.
2. Segment Information
For management purposes, before the disposal of subsidiaries in the period, the Group was organised into two operating divisions; Management Services and Professional Services. These divisions were the basis on which the Group reports its primary segment information. Management Services provided career management and representation advice to entertainers and athletes within the sports and entertainment sectors. Professional Services include wealth management, accountancy and taxation, financial brokerage and construction project management services. These services are provided to individuals, sporting institutions and trusts within the sport, music, entertainment and property sectors.
During the period, all subsidiaries in the Management Services division were sold along with certain subsidiaries within the Professional Services division. The remaining subsidiaries all operate in the Professional Services division.
Segment information about these businesses is presented below:
2009 Management Professional Discontinued Total
Revenue Services Services operations £'000
£'000 £'000 £'000
7,008 23,077 (11,132) 18,953
Segment operating 569 2,914 (4,334) (851)
profit/(loss)
Unallocated corporate expenses (1,584)
Operating loss (2,435)
Investment income 4
Finance costs (486)
Loss before taxation and (2,917)
exceptional items
Exceptional Items (17,824)
Taxation 277
Loss for the year from (20,464)
continuing operations
Loss for the year from (6,307)
discontinued operations
Loss for the year (26,771)
2008 Management Professional Discontinued Total £'000
Revenue Services Services operations 25,006
£'000 £'000 £'000
5,989 28,952 (9,935)
Segment operating profit 1,664 3,245 (2,614) 2,295
Unallocated corporate expenses (1,429)
Operating profit 866
Investment income 119
Finance costs (319)
Profit before taxation 666
Taxation (224)
Profit for the year from continuing operations 442
Profit for the year from discontinued 2,310
operations
Profit for the year 2,752
3. Discontinued Operations
The results of the discontinued operations which have been included in the consolidated income statement, were as follows:
RevenueCost of sales 2009 £*000 2008 £*000 9,936 (477)
11,132(398)
Gross profit 10,734 9,459
Administrative expenses (6,400) (6,183)
Operating profit from discontinued 4,334 3,276
operations
Exceptional items - (662)
Investment income 55 74
Profit before taxation 4,389 2,688
Attributable tax expense (847) (999)
Profit for discontinued operations 3,542 1,689
(Loss)/profit on disposal of (9,849) 621
discontinued operations before taxation
Attributable tax expense - -
(Loss)/profit on disposal of (9,849) 2,310
discontinued operations
(Loss)/profit attributable to (6,307) 2,310
discontinued operations
Of the (loss)/profit on disposal of discontinued operations, a profit of £nil (2008: £621,000) arose on the disposal of the Sports Marketing division.
During the year, the Group had a net cash inflow from investing activities relating to the disposal of various subsidiary companies in the Group of £15,431,000. (2008: £1,007,000 inflow relating to Sports Marketing division).
The effect of discontinued operations on segment results is disclosed in note 2.
4. Earnings per Share
The calculation of basic and diluted earnings per share is based on the following profits and numbers of shares:
2009 2008
£*000 £*000
Basic and diluted (deficit)/earnings * continuing (20,464) 442
operations
Basic and diluted (deficit)/earnings * discontinued (6,329) 2,261
operations
Basic and diluted (deficit)/earnings * continuing and (26,793) 2,703
discontinued operations
2009 2008
Number Number
of shares of shares
*000 *000
Weighted average number of shares:
Basic 214,017 214,017
Dilutive effect of share options - 4,812
Diluted 214,017 218,829
Earnings per share is calculated by dividing the (loss)/profit for the year attributable to equity shareholders by the weighted average number of shares in issue during the year.
5. Dividends
Amounts recognised as distributions to equity holders in the year:
2009 2008
£*000 £*000
Final dividend paid per ordinary share for the year ended 31 August 2009 (2008 * 0.115p) * 235
6. Reconciliation of Profit from Continuing operations
2009 2008 £'000
£'000
Operating (loss)/profit from continuing operations (2,435) 866
Operating profit from discontinued operations 4,334 2,614
Depreciation of property, plant and equipment 111 115
Amortisation of intangible assets 7 8
Share option charge 154 128
Loss on sale of tangible fixed assets - 9
Operating cash flows before movements in working capital 2,171 3,740
Decrease/(increase) in inventories 569 (343)
(Increase)/decrease in receivables (3,349) 161
Decrease in payables (571) (405)
Cash (used in)/generated by operations (38) 3,153
7. Annual Report and Accounts
The annual report will be sent to shareholders on or about 2 February 2010.
Additional copies will be available from that date on the Company's website; www.formationgroupplc.com.
8. Annual General Meeting
The Annual General Meeting of the Company will be held on 26 February 2010 at the offices of the Group's lawyers; DLA Piper in Manchester.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR KKCDNOBKDCDB
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It could have been that they just wanted to protect the investment that they have already made. If a deal with the Heritable administrators wasn't forthcoming then I presume they would have owned the Aldgate development. In this case, Formation would have still been liable for the loan notes and therefore would not only not make profit from the development but would be liable for a further 11.6m. Now this would have been a worrying development for all shareholders because the likelyhood of going bust would have been increased. I suppose in a way i am agreeing with you, but I still don't think that they would have taken this action without thinking the the finance needed would be secured. They also have just completed the whitechapel development so should be seeing some profit from there. Difficult to say how much but could be enough to make the banks feel confident about the loan.
Don't forget as well, that although they sold off the profitable divisions , most of the revenue comes from the property side of the business. |
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The year-end was Aug 31st and their website says the results should be published in November (last year they were published on 19th Nov). As the company is now property-only I want to see a standard set of accounts with a NAV etc.
However this may not be the most important factor as there are two likely options - they get their 55m loan to continue development and the price shoots up before we get a chance to get in, or they go bust! They were clearly worried about going bust when they hived off all the profit making parts of the business to the directors. Think I will wait and see before buying - and keep a careful look out for news and share sells/buys. There is usually a leak if a loan gets approved. |
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Krayl,
The loan notes are specified under the background section of the RNS. I suppose though that this hasn't been clarified whether this has changed or not. It does say however that the maximum liability of 11.6 million has been previously disclosed as a contingent liability in the financial accounts. Under the terms of the loan notes they only have to be repaid by Formation (11.6m) if the project has not been completed by 28/08/11. A little confusing though as you would expect them to have to pay them back by that date whether the project is complete or not. I understand that the 5.5mill paid to the administrators of heritable being a substantial saving on the amount that was initially borrowed, in fact only a third, so the outlay from Formation could be minimal when compared to the potential profit that will be re-couped. My stance on this company remains a weak buy, the reason being like you say as it is still a risk but it is far less a risk than it was a week ago and with the share price at practically an all time low it may be a good time to get in and wait and see. I wouldn't risk my life savings on this, but if I had some spare cash i'd have a punt  |
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It's still highly complicated and I don't pretend to understand it all, but this news does seem to be positive. The main liability has been quantified and has been paid off with 5.5million. This also gives access to 50% of any profit on Aldgate.
The 'loan notes' are not specified in the announcement and so could be anything (I read this as being separate from the 11 mill). They don't seem too worried by them but who is to say? To complete the project they need 55 million, which again they don't seem to be worried about, though there is no mention of how it will be raised. I don't suppose the shareholders could be tapped for that much so presumably it's a bank loan. As I have said before this could be a great investment if it all comes off. It is certainly one to watch and deserves further study, but doesn't seem to be a buy yet. |
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They have not been approved or issued by Interactive Investor Trading Limited.
They have not been approved or issued by Interactive Investor Trading Limited.
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