TIDMHTI
RNS Number : 1174N
Hawtin PLC
07 June 2010
HawTIN PLC ("Hawtin" or the "company")
final results
for the year ended 31 december 2009
The Company is pleased to announce its final results for the year ended 31
December 2009
CHAIRMAN'S STATEMENT:
When I wrote to you on the 1st September 2009 in our interim statement, I was
fairly positive that we would see progress in our lettings. In what remains a
difficult economic climate we have succeeded in lettings at Aberaman, a number
from the Holywell portfolio and at Blackwood which at the year end have improved
the Group's 41% void occupancy to 38%, but at the time of writing this statement
we have seen further improvements to show 19% void. I am confident that given
pipeline lettings and sales that void space could fall to below 10% levels on
the main portfolio by this year end. This would be a strong performance in a
market full of uncertainty and weakening tenant demand.
I am very comforted that the portfolio valuations except for that in Crown
Investments Limited - the Millennium Plaza - have come in with no further
deterioration to those as at 31st December 2008 and that our acquisitions of the
Holywell portfolio and Nantgarw have demonstrated that it remains possible to
make strategic acquisitions which resulted in immediate improvements in value
and cash positions. I will comment on Crown Investments Limited later.
The last quarter of 2009 had our team engaged in extensive dialogue with Lloyds
Banking Group (the "Bank") and a renewal of facilities has now been sanctioned
upon agreeable terms. The current agreement gives us a further extension until
21 July 2010 during which time we will negotiate further to improve the current
offer. The Board are concerned with potential entry and exit fees that the bank
wishes to attach to the new loan, and are seeking to find an equitable solution
on which to move forward. Our existing loan to value rate of 89% puts us in a
position where there is a breach of covenant, which sets the loan to value at
80%. This could allow the bank to rescind its loans but in fairness it has not
done that and plans are being discussed to find mutually acceptable ways
forward.
Millennium Plaza has endured a difficult year. One of the tenants, Regent Inns
plc went into a pre-pack administration owing GBP577,000 as did 3D Leisure who
also owe GBP114,000. These two tenants were previously considered strong
covenants but their failures demonstrate the fragile nature of business in
recession. I am advised that VUE Cinemas traded well at the date of our
interim results and has continued to do so. We were able to re-let Regent Inns
plc's space to Retro Bars, mitigating future losses and restoring rents to
GBP1million p.a. However I am pleased to announce that we now have planning
consent for a refurbishment which not only adds income but also reduces void
service costs. We are now ready to proceed with a restaurant operator who will
take 14,500 sq.ft. when funding has been agreed. This will have a significant
positive effect on the value of the building. There will be phased capital
costs to achieve this and further lettings to make Crown Investment's income
rise to acceptable and profitable levels once again. The 2009 results for Crown
Investments Limited do not reflect the tireless efforts that have gone into
making this investment perform. The loss of tenants, the costs of void space and
the cash needed for tenant incentivisation and conversion means we are unable to
service the Anglo Irish Banking Corporation ("AIBC") debt level of GBP24 million
but we are in discussions with them to help revitalise this building and its
income. They are being very supportive. We are writing the value of the
building down from GBP22 million to GBP16.2 million in these accounts because of
the loss of tenants. Once new tenants are in situ we will of course revisit
this valuation. AIBC have provided a comfort letter to the Directors that they
are aware of the situation and have indicated they do not currently intend to
enforce their conditions. They firmly believe we are the best available
managers of the site.
We were still loss making in 2009 but the pre-tax losses were reduced from
GBP17.8 million in 2008 to GBP4.5 million in 2009. The loss is accounted for by
the writedown of Millennium Plaza - GBP5.8 million, offset by the positive
movement on the interest rate swaps. The increase in overheads from GBP1.9
million to GBP2.8 million in 2009 reflects the absorption of overheads from
companies acquired in 2009. I can assure you that we have reduced and will
reduce costs wherever possible. As mentioned earlier, the positive movement on
the accounting of interest rate swaps referred to in our 2009 interim results
has not deteriorated, resulting in a GBP2 million gain and thus reducing our
full year loss before tax.
Your Board is not recommending a dividend once again as it does not have the
distributable reserves available to do so.
Your Board is more positive today than it was 12 months ago. We have had a
torrid three
years but we are still in business and planning a future. Many larger public
property companies are fortunate in being able to raise cash in the market to
strengthen their balance sheets but our market capitalisation is currently too
small to make this a viable option. We are constantly reviewing how best to
progress the Group going forward and are contemplating a number of options
including a move away from being a dedicated investment property company to a
property trading company where profits may be more easily generated. Your Board
believes that borrowing money from the banks is going to remain difficult and
therefore cash generation rather than relying on capital appreciation, is
preferable.
Needless to say the last three years have been a time of pressure on all our
valued staff that either work for or advise the Group. Without their
considerable input, efforts and labours we would not have achieved what we have
and I trust that you will join me in thanking them.
CHIEF EXECUTIVE'S REPORT:
2009 was the most challenging and difficult of my stewardship at the helm of
Hawtin. The most significant challenge was always going to be our relationship
with the banks given the deterioration of cash flows in Hawtin.
The Directors have toiled unrelentingly to identify solutions including the
scheme to buy Howells in Cardiff from British Land. The Group failed in raising
the required funds and subsequently lost the likely profit that deal would have
delivered which was extremely disappointing. The solution of raising cash as
other larger public property companies have done is not available to Hawtin and
we have to find other solutions. However this demonstrates the ability of the
team to identify good profitable transactions which I am becoming more confident
we can fund.
We acquired the Holywell Portfolio valued at GBP9.6 million and three prime
industrial units at Nantgarw, just north of Cardiff for GBP4.4 million in
February and January 2009 respectively. Both these portfolios have been
excellent buys and strengthened our position.
We completed the sale of Unit 6.2 at Parc Nantgarw for GBP1.8 million and four
of the residential units from the Holywell portfolio for GBP0.5 million which
generated profits of GBP0.3 million. You will recall that we acquired three
units at Nantgarw at 12% yield for GBP4.35m, a significant discount to the then
market value.
Also on the positive side we have made massive progress on lettings including:-
Beechwood House, Cardiff: office block let to ADT Fire and Security PLC on a 10
year lease at a current income of GBP54,000 p.a.
Blackwood Business Park, Gwent: 96,950sq.ft let to Plastics Sorting Company
Limited in October 2009 for a term of ten years.
C1 Trade Park, Aberaman Park Industrial Estate, Aberdare: 48,000 sq.ft. let to
Sunlight Services Group Limited for ten years with stepped rents rising to
GBP110,000 p.a. in year 4. Unit 3 at C1 is also let and the remaining units have
been taken on a short term basis by Sunlight Services Group at a rent of
GBP22,000 p.a. .
Parc Nantgarw: rent review on Unit 6.1 - 52,000sq.ft. let to General Motors
Acceptances Corporation (UK) PLC at a rent of GBP284,000 that reflects a
significant premium.
Millennium Plaza: lease to Retro Live Limited and the Retro Club of the former
25,000 sq ft space let to Regent Inns plc on a lease for fifteen years at an
initial annual rental of GBP150,000p.a.
We have consolidated the Holywell Portfolio in our systems - tenant failure has
been extremely low and we have re-let, usually at better rentals, any space
arising. I also feel that there are more opportunities to enhance income
particularly by changing the planning use to residential and at the appropriate
time we intend to sell the two remaining residential properties.
And in 2010:-
Heads of the Valley Industrial Estate, Nr Rhymney : 16,000 sq. ft. to Primacare
Limited in March 2010 on a seven year lease with stepped rents rising to
GBP22,000 p.a.
In May 2010 the sale of our Portsmouth property was agreed at a price of GBP4.4
million against a valuation at the year end of GBP4 million. The proceeds will
be used to reduce the Group's borrowings.
Compared with this time last year, the team have made massive progress in
increasing income and reducing void costs. We have opportunities at Berkhamsted
and Aberaman for development, but really the issues on lettings and occupancy
are now resolved other than at Millennium Plaza, and we are well on our way
there to improve value through new lettings.
Hawtin needs radical change to bring back shareholder value and the Board does
not currently believe that the answer remains in the property investment market.
A potentially better market is in dealing and development where the gains are
usually cash generative and the capital employed is considerably less. We are
currently working on such a strategy and the quicker we can move to a clean
sheet of paper the quicker shareholder value will return. We have a plan which
we are following but we need the ongoing support of our banks and whilst we
currently have their indicative approval, I would like to think by the end of
the year a clear picture will have emerged.
The Chairman has commented on Millennium Plaza which has taken a great deal of
effort to reconfigure to meet the changing requirements of a major leisure
attraction. The loss of two tenants who failed in the recession has been a major
set-back but I feel that with a very solid anchor tenant in VUE Cinemas and with
Retro Bars trading well and establishing itself in the market we can make
progress. We are about to sign an agreement to lease for 14,500sq.ft of space
but need to spend some GBP700,000 to enable the necessary works to facilitate
this tenant and reshape the foyer to give each tenant a separate access which in
turn will reduce running costs. It is this aspect that we are discussing with
Anglo Irish Banking Corporation ("AIBC") as this will not only increase the
rental flow but will positively restore the depleted valuation level at which
the site currently stands. At the time of writing AIBC remain supportive but
the final decision will be made by the Irish Government who are now owners of
AIBC following its demise.
OUTLOOK:
Our future is highly dependent on the banks returning to the market at loan to
value covenants and rates and costs that are affordable and it is my belief that
rental growth will be constrained for some time such that with rising costs,
profits will remain subdued unless we can take advantage of the opportunities in
residential, development and/or trading. We are reviewing each and every
opportunity to develop the Group and, as the Chairman commented, this may mean
reinventing ourselves yet again to move forward. Anyone involved in property
has been here before but there are significant differences between this
recession as compared with those of the 1980s and 1990s. This recession is far
worse. It is deeper and I believe will be more prolonged. I have no doubt that
in the course of the next five years we shall see a progressive return but that
is a very long time away and we have to find alternative ways to reinvigorate
shareholder value. Undoubtedly we and many other property companies are
considering the same paths, but those who move quickly and bravely, not holding
onto the past, that can break free of the current debt with which they are
burdened, will move to clearer waters and a return to sustainable profit and
that is the phrase we need to keep repeating: sustainable profit. A recession
of this magnitude creates fragility in an investment company which is instantly
hit by failing tenants and the banks. The banks remain cautious which makes our
life more difficult but our strength lies in our management team and the Board
who have a steady hand on the tiller, and although we accept that the stakes are
high and the road is rocky, we have a plan to bring us through to becoming a
strong and profitable business. I hope to report at the Annual General Meeting
further progress on all these exciting developments and I look forward to
meeting as many shareholders that can attend and join us to discuss the future.
+-----------------------------------+---+----------+----------+
| HAWTIN PLC | | | |
| Consolidated Statement of | | | |
| Comprehensive Income for the year | | | |
| ended 31 December 2009 | | | |
| | | | |
+-----------------------------------+---+----------+----------+
| | | Year | Year |
| | | ended | ended |
| | | 31 | 31 |
| | | December | December |
| | | 2009 | 2008 |
| | | GBP'000 | GBP'000 |
+-----------------------------------+---+----------+----------+
| Continuing operations | | | |
+-----------------------------------+---+----------+----------+
| Revenue | | 4,142 | 3,867 |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Other operating income | | 1,652 | 195 |
+-----------------------------------+---+----------+----------+
| Revaluation deficit | | (5,798) | (11,145) |
+-----------------------------------+---+----------+----------+
| Administrative expenses | | (2,827) | (1,896) |
+-----------------------------------+---+----------+----------+
| Other operating expenses | | - | (51) |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Loss from operations | | (2,831) | (9,030) |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Financial income | | 25 | 124 |
+-----------------------------------+---+----------+----------+
| Financial expenses | | (3,620) | (3,744) |
+-----------------------------------+---+----------+----------+
| Movement in value of financial | | 1,949 | (5,184) |
| instrument | | | |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Loss before tax | | (4,477) | (17,834) |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Taxation | | (893) | 109 |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Loss for the year | | (5,370) | (17,725) |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Attributable to: | | | |
+-----------------------------------+---+----------+----------+
| Ordinary shareholders | | (5,370) | (17,727) |
+-----------------------------------+---+----------+----------+
| Minority interests | | - | 2 |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Net loss | | (5,370) | (17,725) |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
| Basic and diluted loss per | | (5.48) | (22.93) |
| ordinary share | | p | p |
+-----------------------------------+---+----------+----------+
| | | | |
+-----------------------------------+---+----------+----------+
+-------------------------------+-------+----------+----------+
| HAWTIN PLC | | | |
| Consolidated Balance Sheet | | | |
| As at 31 December 2009 | | | |
| | | | |
+-------------------------------+-------+----------+----------+
| | Note | 31 | 31 |
| | | December | December |
| | | 2009 | 2008 |
| | | GBP'000 | GBP'000 |
+-------------------------------+-------+----------+----------+
| Non-current assets | | | |
+-------------------------------+-------+----------+----------+
| Investment properties | 6 | 56,123 | 49,539 |
+-------------------------------+-------+----------+----------+
| Deferred tax asset | | - | 1,751 |
+-------------------------------+-------+----------+----------+
| | | 56,123 | 51,290 |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Current assets | | | |
+-------------------------------+-------+----------+----------+
| Trade and other receivables | | 843 | 919 |
+-------------------------------+-------+----------+----------+
| Cash and cash equivalents | | 3,579 | 1,809 |
+-------------------------------+-------+----------+----------+
| | | 4,422 | 2,728 |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Current liabilities | | | |
+-------------------------------+-------+----------+----------+
| Trade and other payables | | (3,655) | (2,417) |
+-------------------------------+-------+----------+----------+
| Derivative financial | | (3,561) | (5,510) |
| instruments | | | |
+-------------------------------+-------+----------+----------+
| Short-term borrowings and | 7 | (60,614) | (47,917) |
| overdrafts | | | |
+-------------------------------+-------+----------+----------+
| | | (67,830) | (55,844) |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Net current liabilities | | (63,408) | (53,116) |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Non-current liabilities | | | |
+-------------------------------+-------+----------+----------+
| Long-term borrowings | 7 | (2,130) | (3,505) |
+-------------------------------+-------+----------+----------+
| Cumulative preference shares | 7 | (549) | (549) |
+-------------------------------+-------+----------+----------+
| Deferred tax | | (386) | - |
+-------------------------------+-------+----------+----------+
| | | (3,065) | (4,054) |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Net liabilities | | (10,350) | (5,880) |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
| Capital and reserves | | | |
+-------------------------------+-------+----------+----------+
| Equity share capital | | 5,017 | 4,017 |
+-------------------------------+-------+----------+----------+
| Equity reserve | | 900 | 900 |
+-------------------------------+-------+----------+----------+
| Reserve arising on | | (100) | - |
| acquisition | | | |
+-------------------------------+-------+----------+----------+
| Other reserves | | 3,301 | 3,265 |
+-------------------------------+-------+----------+----------+
| Retained earnings | | (19,468) | (14,062) |
+-------------------------------+-------+----------+----------+
| Total equity | | (10,350) | (5,880) |
+-------------------------------+-------+----------+----------+
| | | | |
+-------------------------------+-------+----------+----------+
+------------------------------------+----------------------+-----------------------+
| HAWTIN PLC | | |
| Consolidated Cash Flow Statement | | |
| for the year ended 31 December | | |
| 2009 | | |
| | Year | Year |
| | ended | ended |
+------------------------------------+----------------------+-----------------------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
| | GBP'000 | GBP'000 |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
| Net cash inflow from operating | 1,313 | 1,596 |
| activities | | |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
| Investing activities | | |
+------------------------------------+----------------------+-----------------------+
| Interest received | 25 | 124 |
+------------------------------------+----------------------+-----------------------+
| Purchase of property and equipment | (4,732) | (509) |
+------------------------------------+----------------------+-----------------------+
| Acquisition of subsidiary | (2,117) | - |
| undertakings | | |
+------------------------------------+----------------------+-----------------------+
| Cash acquired with subsidiary | 65 | - |
| undertakings | | |
+------------------------------------+----------------------+-----------------------+
| Proceeds of disposal of property | 2,238 | 138 |
+------------------------------------+----------------------+-----------------------+
| Net cash from investing activities | (4,521) | (247) |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
| Financing activities | | |
+------------------------------------+----------------------+-----------------------+
| Interest paid | (2,283) | (3,915) |
+------------------------------------+----------------------+-----------------------+
| Preference dividend paid | - | (36) |
+------------------------------------+----------------------+-----------------------+
| New bank loans raised | 11,780 | - |
+------------------------------------+----------------------+-----------------------+
| Bank loans (repaid)/received | (4,717) | 150 |
+------------------------------------+----------------------+-----------------------+
| Decrease in bank overdrafts | 198 | 130 |
+------------------------------------+----------------------+-----------------------+
| Net cash from financing activities | 4,978 | (3,971) |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
| Net increase/(decrease) in cash | 1,770 | (2,622) |
| and cash equivalents | | |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
| Cash and cash equivalents at the | 1,809 | 4,431 |
| beginning of the period | | |
+------------------------------------+----------------------+-----------------------+
| Cash and cash equivalents at the | 3,579 | 1,809 |
| end of the period | | |
+------------------------------------+----------------------+-----------------------+
| | | |
+------------------------------------+----------------------+-----------------------+
+--------------+---------+---------+-------------+----------+----------+----------+
| HAWTIN PLC | | | |
| Consolidated Statement of | | | |
| Changes in Equity for the year | | | |
| ended 31 December 2009 | | | |
+------------------------------------------------+----------+----------+----------+
| | Equity | Equity | Reserve | Other |Retained | Total |
| | share |reserve | on |reserves |earnings | equity |
| |capital | |acquisition | | | |
| | | | | | | |
| |GBP'000 |GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+--------------+---------+---------+-------------+----------+----------+----------+
| At 1 | 4,017 | 900 | - | 3,265 | (14,062) | (5,880) |
| January | | | | | | |
| 2009 | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
| Shares | | | | | | |
| issued to | 1,000 | - | - | - | - | 1,000 |
| acquire | | | | | | |
| subsidiaries | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
| | | | | | | |
| | | | | | | |
| Transfer to | | | | | | |
| preference | - | - | - | 36 | (36) | - |
| dividend | | | | | | |
| reserve | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
| Reserve | | | | | | |
| arising on | - | - | (100) | - | - | (100) |
| acquisition | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
| Loss for | | | | | | |
| the | - | - | - | - | (5,370) | (5,370) |
| financial | | | | | | |
| year | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
| At 31 | | | | | | |
| December | 5,017 | 900 | (100) | 3,301 | (19,468) | (10,350) |
| 2009 | | | | | | |
+--------------+---------+---------+-------------+----------+----------+----------+
NOTES
1. FINANCIAL INFORMATION
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the year ended 31 December 2009 or the year
ended 31 December 2008 but it is derived from those accounts. Statutory
accounts for 2008 have been delivered to the Registrar of Companies and those
for 2009 will be delivered following the Company's Annual General Meeting. The
auditors reported on those accounts; their report was unqualified and did not
contain a statement under s498(2) or (3) of the Companies Act 2006.
Without qualifying the accounts, the auditors' report did contain a paragraph
drawing attention to the fundamental uncertainty surrounding the application of
the going concern basis in the preparation of the accounts, which is repeated
below:
"In forming our opinion on the financial statements, which is not qualified, we
have considered the adequacy of the disclosure in note 3 to the financial
statements concerning the Group's ability to continue as a going concern. The
company incurred a loss before tax of GBP4.48 million during the year ended 31
December 2009 and as of that date had net liabilities of GBP10.35 million and
was in breach of a number of its bank covenants. These conditions, along with
other matters explained in note 3 to the financial statements, indicate the
existence of a material uncertainty which may cast significant doubt about the
company's ability to continue as a going concern. Nevertheless, for the reasons
explained in note 3, the directors have prepared these financial statements on a
going concern basis. If the adoption of the going concern basis were
inappropriate, adjustments, which it is not practicable to quantify, would be
required, including those to write down assets to their recoverable value, to
reclassify fixed assets as current assets and to provide for further liabilities
that may arise".
The Annual Report and Accounts for the year ended 31 December 2009 will be
published in June 2010.
Whilst the financial information included in this preliminary announcement has
been completed in accordance with International Financial Reporting Standards
(IFRSs ), this announcement itself does not contain sufficient information to
comply with IFRSs.
The final results announcement was approved by the Board of Directors on 28 May
2010.
2. ACCOUNTING POLICIES
+-----------------+----------+----------+---------------------------+---------------------+---+
| a) Accounting convention | The financial information has been prepared | |
| | under the historical cost convention as | |
| | modified by the revaluation of certain | |
| | properties and financial instruments. | |
+---------------------------------------+-------------------------------------------------+---+
| b) Consolidation | The financial information consolidates the | |
| | financial information of the Company and all | |
| | entities controlled by the Company (its | |
| | subsidiaries) and jointly controlled (its joint | |
| | ventures which are proportionately | |
| | consolidated, i.e. with the Group's share of | |
| | individual line items being reflected within | |
| | the income statement and the balance sheet). | |
| | Control is achieved where the Company has the | |
| | power to govern the financial and operating | |
| | policies of an investee entity so as to obtain | |
| | benefits for its activities. | |
| | In respect of subsidiaries which have been sold | |
| | or have ceased trading, results are included to | |
| | the date of sale or cessation of activities. | |
| | Minority interests in the net assets of | |
| | consolidated subsidiaries are disclosed | |
| | separately from the Group's equity therein. | |
| | Minority interests consist of the amount of | |
| | those interests at the date of the original | |
| | business combination and the minority's share | |
| | of changes in the equity since the date of the | |
| | combination. Losses applicable to the minority | |
| | in excess of the minority's interest in the | |
| | subsidiary's equity are allocated against the | |
| | interest of the Group, except to the extent | |
| | that the minority has a binding obligation and | |
| | is able to make an additional investment to | |
| | cover the losses. | |
| | Where necessary, adjustments are made to the | |
| | financial statements of the subsidiaries and | |
| | joint ventures to bring the accounting policies | |
| | used into line with those used by the Group. | |
+---------------------------------------+-------------------------------------------------+---+
| c) Business combinations | The cost of acquisition of subsidiaries is | |
| | measured against the net fair value of the | |
| | assets and liabilities acquired and the | |
| | difference is recognised as goodwill. The cost | |
| | includes the consideration and associated costs | |
| | of acquisition. | |
| | Goodwill is recognised as an asset and recorded | |
| | at cost in the balance sheet from the date of | |
| | acquisition. If after reassessment, the Group's | |
| | interest in the net fair value of the acquirees | |
| | identifiable assets, liabilities and contingent | |
| | liabilities exceeds the cost of the business | |
| | combination, the excess is recognized | |
| | immediately in profit or loss. | |
| | The interest of minority shareholders in the | |
| | acquiree is initially measured at the | |
| | minority's proportion of the net fair value of | |
| | the assets and liabilities acquired. | |
+---------------------------------------+-------------------------------------------------+---+
| d) Taxation | The tax expense represents the sum of tax payable currently and | |
| | deferred tax. Tax paid currently is the tax to be paid in respect of | |
| | the taxable profit for the year. Taxable profit differs from net | |
| | profit as reported in the income statement because certain items will | |
| | not generate a tax payment or relief until some time in the future. | |
| | The Group's liability for current tax is calculated using tax rates | |
| | that have been enacted or substantively enacted by the balance sheet | |
| | date. | |
| | Deferred tax is tax expected to be payable or recoverable on | |
| | differences between the carrying amounts of assets and liabilities in | |
| | the financial information and the corresponding tax bases used in the | |
| | computation of taxable profit and is accounted for using the balance | |
| | sheet liability method. Deferred tax liabilities are generally | |
| | recognised for all taxable temporary differences. Deferred tax assets | |
| | are recognised for all taxable temporary differences and deferred tax | |
| | assets are recognised to the extent that it is probable that taxable | |
| | profits will be available against which deductible temporary | |
| | differences can be utilised. The carrying amounts of deferred tax | |
| | assets are reviewed at each balance sheet date and reduced to the | |
| | extent that it is no longer probable that sufficient taxable profits | |
| | will be available to allow all or part of the asset to be recovered. | |
| | Deferred tax assets are offset against liabilities where there is a | |
| | legal right to offset against current tax and are displayed as a net | |
| | asset or liability. | |
+-----------------+-----------------------------------------------------------------------+---+
| e) Investment | Investment properties are those which are held to earn rental income | |
| properties | and for capital appreciation and are included on the balance sheet at | |
| | fair value. Gains or losses arising from changes in the fair value of | |
| | investment properties are included in the income statement for the | |
| | period. Depreciation is not charged on investment properties. | |
+-----------------+-----------------------------------------------------------------------+---+
| f) Investments | Fixed asset investments are stated at cost less provision for | |
| | impairment. | |
+-----------------+-----------------------------------------------------------------------+---+
| g) Property, | Property, plant and equipment are stated at cost less accumulated | |
| plant and | depreciation and any recognised impairment loss. | |
| equipment | Depreciation is provided on other assets, by equal annual | |
| | instalments, over the estimated lives of the assets. | |
| | The rates of depreciation are as follows: | |
+-----------------+-----------------------------------------------------------------------+---+
| | | |
+-----------------+-----------------------------------------------------------------------+---+
| | Short leasehold land and buildings | Period of lease | |
+-----------------+-------------------------------------------------+---------------------+---+
| | Freehold and long leasehold buildings | 2% | |
+-----------------+-------------------------------------------------+---------------------+---+
| | Plant and equipment | 10% - 50% | |
+-----------------+-------------------------------------------------+---------------------+---+
| | Fixtures, fittings and office equipment | 15% - 50% | |
+-----------------+-------------------------------------------------+---------------------+---+
| | Motor vehicles | 25% - 33% | |
+-----------------+-------------------------------------------------+---------------------+---+
| | | |
+-----------------+-----------------------------------------------------------------------+---+
| h) Non-current | Non-current assets are classified as held for resale if their | |
| assets held for | carrying value will be recovered through a sale transaction rather | |
| resale | that through continuing use. An asset may only be classified in this | |
| | way if it is available for immediate sale in its current condition | |
| | and the sale is probable. | |
| | Non-current assets are held in the balance sheet at the lower of | |
| | carrying amount and fair value less costs of disposal. | |
+-----------------+-----------------------------------------------------------------------+---+
| i) Revenue | Revenue is measured at the fair value of consideration received or | |
| recognition | receivable in the normal course of business net of discounts and VAT. | |
| | Property income is recognised evenly over the period of the rental | |
| | agreement. Where a rent-free period or other form of inducement is | |
| | included in the lease, the rental income foregone is allocated evenly | |
| | over the period from the date of the lease commencement to the | |
| | earliest termination date. Other operating income is recognised as | |
| | the Group earns the right to the consideration. | |
| | Interest income is accrued on a time basis by reference to principal | |
| | outstanding and applicable rates of interest. | |
+-----------------+-----------------------------------------------------------------------+---+
| j) Foreign | The financial information for the Company and all its subsidiaries is | |
| currencies | presented in sterling, which is the functional currency for each of | |
| | the companies in the Group and is the presentation currency for the | |
| | financial information. | |
| | - | |
| | Transactions in currencies other than the functional currency | |
| | (foreign currencies) are recorded at the rate of exchange prevailing | |
| | on the dates of the transactions. At each balance sheet date, the | |
| | assets and liabilities in foreign currencies are translated into | |
| | sterling at the rates ruling at the balance sheet date. | |
| | Gains or losses on exchange arising from settlement or retranslation | |
| | of monetary items are included in profit or loss for the period. | |
+-----------------+-----------------------------------------------------------------------+---+
| k) Grants | Revenue based grants are credited to the income statement on a | |
| | receivable basis. | |
| | Grants relating to property, plant and equipment are treated as | |
| | deferred income and released to the income statement over the | |
| | expected useful lives of the assets to which they relate. | |
+-----------------+-----------------------------------------------------------------------+---+
| l) Pension costs | The Group operates a defined contribution pension scheme. | |
| | The charge for the year represents contributions payable | |
| | in the year. | |
+----------------------------+------------------------------------------------------------+---+
| m) Leases | Assets held under finance lease and hire purchase | |
| | contracts and the related obligations are recorded in the | |
| | balance sheet at the fair value of the assets at the | |
| | inception of the contracts. The amounts by which the | |
| | payments exceed the recorded obligations are treated as | |
| | finance charges which are amortised over each contract | |
| | term to give a constant rate of charge on the remaining | |
| | balance of the obligation. | |
| | Rental costs under operating leases are charged to the | |
| | income statement in equal amounts over the period of the | |
| | lease. | |
+----------------------------+------------------------------------------------------------+---+
| n) Financial instruments | Financial assets and liabilities are recognised on the | |
| | balance sheet at market value when the Company becomes a | |
| | party to that instrument. | |
| | Trade receivables | |
| | Trade receivables are measured at initial recognition at | |
| | fair value, and are subsequently measured at amortised | |
| | cost using the effective interest rate method. Appropriate | |
| | allowances for estimated irrecoverable amounts are | |
| | recognised in the income statement when there is objective | |
| | evidence that the asset is impaired. The allowance | |
| | recognised is measured as the difference between the | |
| | asset's carrying amount and the present value of estimated | |
| | future cash flows discounted at the effective interest | |
| | rate computed at initial recognition. | |
| | Cash and cash equivalents | |
| | Cash and cash equivalents comprise cash on hand and on | |
| | demand deposits held at call with banks. | |
| | Trade payables | |
| | Trade payables are initially measured at fair value, and | |
| | are subsequently measured at amortised cost using the | |
| | effective interest rate method. | |
| | Bank loans | |
| | Interest bearing bank loans and overdrafts are recorded at | |
| | the proceeds received, net of direct issue costs. Finance | |
| | charges, including premiums payable on settlement and | |
| | direct issue costs, are accounted for on an accruals basis | |
| | in profit or loss using the effective interest rate method | |
| | and are added to the carrying amount of the instrument to | |
| | the extent that they are not settled in the period in | |
| | which they arise. | |
+----------------------------+------------------------------------------------------------+---+
| | Convertible loan notes and preference shares | |
| | Non-derivative financial instruments are evaluated to | |
| | determine whether the financial instrument contains both a | |
| | liability and an equity component. Such components are | |
| | classified separately as financial liabilities and equity | |
| | instruments. The sum of the carrying amounts assigned to | |
| | the liability and equity components on initial recognition | |
| | is equal to the fair value that is ascribed to the | |
| | instrument as a whole. | |
| | The liability component is derived from the equivalent | |
| | loan principal achieved at the appropriate interest rate | |
| | according to the terms of the loan, determined by the | |
| | fixed interest amount. The equity amount is the total | |
| | value of the loan note less the liability component. | |
| | Derivative financial instruments | |
| | The Group's activities expose it to financial risks of | |
| | changes in interest rates and the group uses interest rate | |
| | hedge contracts to manage these exposures. The Group does | |
| | not use financial instruments for speculative purposes. | |
| | The use of financial instruments is governed by the | |
| | Group's policies and is approved by the Board of | |
| | Directors. | |
| | The Group's financial instruments do not qualify for hedge | |
| | accounting. The fair value of financial instruments is | |
| | reviewed at each balance sheet date and the changes in | |
| | fair value are recognised in the income statement as they | |
| | arise. | |
| | Fair value of derivative financial instruments is | |
| | determined with reference to available data at the balance | |
| | sheet date concerning future interest rates. | |
+----------------------------+------------------------------------------------------------+---+
| o) Borrowing costs | Borrowing costs are spread in the income statement over the |
| | period of the associated borrowing. |
+----------------------------+----------------------------------------------------------------+
| p) (Loss)/profit from | (Loss)/profit from operations is stated after charging or |
| operations | recognising property revaluation (deficits)/surpluses, but |
| | before investment income and finance costs. |
+----------------------------+----------------------------------------------------------------+
| q) Goodwill | Goodwill represents the excess of the cost of an acquisition |
| | over the Group's interest in the fair value of the net assets |
| | acquired at the date of acquisition. Goodwill is initially |
| | recognised as an asset at cost and is subsequently measured at |
| | cost less any accumulated impairment losses. Goodwill is |
| | reviewed for impairment annually, or at any time if events |
| | suggest that the carrying value of goodwill has been affected. |
| | Any impairment is charged to the income statement immediately |
| | and will not be reversed subsequently. On disposal of a |
| | subsidiary, the attributable amount of goodwill is included in |
| | the determination of the gain or loss on disposal. |
+----------------------------+----------------------------------------------------------------+
| r) Impairment | At each balance sheet date, the Group's tangible and |
| | intangible assets are reviewed to consider whether the |
| | carrying value of those assets has diminished. The recoverable |
| | amount from each asset is considered either by reference to |
| | fair value at sale or through discounted cash flows to give a |
| | present value and, where this is lower than the carrying |
| | value, an impairment charge is made. The impairment charge is |
| | made to the income statement or as a revaluation deficit if |
| | the asset had been previously revalued. Any reversal of an |
| | impairment charge is credited to the income statement or as a |
| | revaluation surplus. A reversal of an impairment charge cannot |
| | increase the carrying value above the carrying value on |
| | acquisition. |
+----------------------------+----------------------------------------------------------------+
| s) Going Concern | The Group's Business activities, together with the factors |
| | most likely to affect its future trading performance and |
| | position, borrowings, cash flows and liquidity are set out in |
| | the Chairman's and Chief Executive's Statements. Note 17 of |
| | the accounts also outlines the financial risks and details of |
| | its financial instruments. The Directors have assessed the |
| | balance sheet and likely future cash flows of the Company and |
| | the Group at the date of signing the Directors' Report and |
| | Accounts and have concluded that it is appropriate to prepare |
| | the Annual Report on a going concern basis. |
| | General economic conditions have been extremely uncertain for |
| | some time and may continue for a period which is difficult to |
| | estimate. The property and banking sectors have been at the |
| | forefront of the turmoil created by the "credit crunch" and |
| | all traditional norms and practices have been disrupted. The |
| | Company has remained close to its banks and has sought and |
| | been given reassurances over the facilities enjoyed by the |
| | Group at this stage. To date we have received considerable |
| | assistance and support from our banks on an informal basis, |
| | but are aware that the normal sanction and credit approval |
| | processes are not operating consistently or with certainty. We |
| | have however been granted a three month extension to the |
| | facility with the Lloyds Banking Group and expect this will be |
| | extended further in July 2010 when the revised facility |
| | expires. |
| | The Group has met all interest payments due to Lloyds Banking |
| | Group and has produced profit and cash flow forecasts that |
| | indicate that all interest payments will continue to be met |
| | and that the income covenant for HBos loans is not under |
| | threat for the foreseeable future. |
| | The Group has not met all interest payments due to Anglo Irish |
| | Bank and is forecasting to continue to fail to meet interest |
| | payments until rent levels in the Millennium Plaza are |
| | restored, which is expected within the next twelve months. |
| | However the Board have been in detailed discussions with Anglo |
| | Irish Bank for some time in order to help them understand the |
| | proposed new letting profile, and the positive effect this |
| | will have on the investment value. On this basis the Board |
| | expects Anglo Irish to continue to support efforts to enhance |
| | the property investment. |
| | These financial statements include adjustments to the carrying |
| | value of the property portfolio that have arisen through a |
| | widespread reduction in property values from which the Group's |
| | portfolio is not immune. It has been difficult to establish |
| | true 'market values' as comparable transactions are sparse and |
| | invariably affected by specific factors that do not allow the |
| | industry standard of "willing buyer" and "willing seller" to |
| | operate. There is a fundamental assumption which underpins the |
| | Boards strategy, namely that the property market values will |
| | recover over time and loan to value ratios will be restored. |
| | In the meantime, the Directors observe that banks are |
| | generally not enforcing loan to value covenants even though |
| | market forces would invariably lead them to expect many loans, |
| | including Hawtin Group loans, to be in breach. The property |
| | valuations included in these financial statements constitute a |
| | breach of loan to value covenants under the HBoS and Anglo |
| | Irish Bank term loans. Furthermore, the Group's joint venture |
| | has a loan facility with Allied Irish Bank and as at the year |
| | end is also in breach of the loan to value covenant facility |
| | attached to this loan. The banks have not sought to enforce |
| | their rights despite the loan to value covenant breaches and |
| | have written to the directors acknowledging the covenant |
| | breaches. The forecasts reviewed and approved by the Board |
| | assume that providing they continue to meet interest payments |
| | and income covenants, for the Lloyds and Allied Irish Bank, |
| | loan to value breaches will not be enforced. |
| | Under a guarantee from the Group to Anglo Irish Bank to |
| | support the term loan to Crown Investments Limited, there is a |
| | minimum net asset covenant for the Group. After significant |
| | write downs in respect of interest rate swaps and property |
| | revaluation deficits, this covenant is breached. Furthermore, |
| | owing to the loss of tenants in the Millennium Plaza the |
| | income covenant attached to the loan has been breached in the |
| | year. Anglo Irish Bank has written to the Directors |
| | acknowledging the breaches and confirming that no action is |
| | presently been taken and so the Board has assumed that no |
| | action will be taken in the forecast period. |
| | The forecasts produced to support the going concern assumption |
| | are reliant on a number of factors that depend on the outcome |
| | of future events including the receipt of a short term loan |
| | from a company with whom the Group is currently in discussions |
| | to facilitate the ongoing banking position with Anglo Irish |
| | Bank; additional financing from Anglo Irish Bank to facilitate |
| | enabling works at Millennium Plaza on a pre-let basis; the |
| | sale of certain properties; the completion of a short term |
| | lease in the Millennium Plaza; and continued payments by |
| | tenants and no defaults in the forecast period.. |
| | The Group is dependent on the ability of its tenants to make |
| | payments due under leases and is exposed to the risk that they |
| | may default, dependent on the individual circumstances of each |
| | tenant and the current economic climate. The Group carefully |
| | considers the financial position of each tenant before any new |
| | leases are signed and monitors their subsequent condition. |
| | The directors are not aware of any tenants which present a |
| | major risk to the Group based on currently available |
| | information. Should any of the tenants default in the period, |
| | depending on the severity of the default, the Directors are |
| | satisfied that they have the financial resources to manage the |
| | consequences satisfactorily. |
| | The Board has examined the forecast and consider the |
| | assumptions made to be reasonable in the circumstances. They |
| | have considered the implications of a potential sale |
| | transaction referred to in the notice of AGM and are satisfied |
| | that in the event of the sale taking place the Group will |
| | continue to be a going concern. For these reasons and taking |
| | account of the expected continued support of the Group's |
| | banks, they have adopted the going concern assumption in |
| | preparing the financial statements. |
| | The financial statements do not include any adjustments that |
| | would result if the going concern assumption were not |
| | applicable. |
+----------------------------+----------------------------------------------------------------+
| | | | | | |
+-----------------+----------+----------+---------------------------+---------------------+---+
3. DIVIDENDS
The Board cannot propose an ordinary dividend (2008 - GBPnil).
At 31 December 2009, the parent company did not have distributable reserves and
the preference dividends payments have been suspended.
4. LOSS PER ORDINARY SHARE
The basic loss per ordinary share is based on a loss of GBP5,370,000 (2008 -
GBP17,725,000) being the loss attributable to ordinary shareholders and on a
weighted average of 97,928,839 (2008- 77,296,419) Ordinary Shares in issue.
Diluted loss per Ordinary Share is the same as basic loss per Ordinary Share
because outstanding options are anti-dilutive.
5. NOTES TO THE CASH FLOW STATEMENT
+----------------------------------------------+---------+---------+
| | 2009 | 2008 |
| | GBP000 | GBP000 |
+----------------------------------------------+---------+---------+
| | | |
+----------------------------------------------+---------+---------+
| Loss from operations | (2,831) | (9,030) |
+----------------------------------------------+---------+---------+
| Adjustments for: | | |
+----------------------------------------------+---------+---------+
| Depreciation of tangible fixed | - | 2 |
| assets | | |
+----------------------------------------------+---------+---------+
| Negative goodwill | (1,126) | - |
+----------------------------------------------+---------+---------+
| Profit on sale of investment | (304) | - |
| property | | |
+----------------------------------------------+---------+---------+
| Decrease in fair value of | 5,798 | 11,145 |
| investment property | | |
+----------------------------------------------+---------+---------+
| Operating cash flows before movements in | 1,537 | 2,117 |
| working capital | | |
+----------------------------------------------+---------+---------+
| Decrease in receivables | 128 | 55 |
+----------------------------------------------+---------+---------+
| Decrease in trade payables | (352) | (576) |
+----------------------------------------------+---------+---------+
| Net cash inflow from operating activities | 1,313 | 1,596 |
+----------------------------------------------+---------+---------+
6. NON CURRENT ASSETS
+------------------------------------+------------+-----------+
| Property ,Plant and equipment and | | |
| Investment Property | | |
| | Freehold | Plant |
| | investment | and |
| | properties | Equipment |
| | GBP'000 | |
| | | |
| | | GBP'000 |
+------------------------------------+------------+-----------+
| Cost or valuation | | |
+------------------------------------+------------+-----------+
| At 1 January 2009 | 49,539 | 3 |
+------------------------------------+------------+-----------+
| Additions | 4,732 | - |
+------------------------------------+------------+-----------+
| On acquisition of subsidiary | 9,583 | - |
| undertakings | | |
+------------------------------------+------------+-----------+
| Disposals | (1,933) | - |
+------------------------------------+------------+-----------+
| Revaluation deficit | (5,798) | - |
+------------------------------------+------------+-----------+
| At 31 December 2009 | 56,123 | 3 |
+------------------------------------+------------+-----------+
| | | |
+------------------------------------+------------+-----------+
| Depreciation and impairment: | | |
+------------------------------------+------------+-----------+
| At 1 January 2009 | - | 3 |
+------------------------------------+------------+-----------+
| Charge for the year | - | 2 |
+------------------------------------+------------+-----------+
| At 31 December 2009 | - | 3 |
+------------------------------------+------------+-----------+
| Net Book Value at 31 December 2009 | 56,123 | - |
+------------------------------------+------------+-----------+
| Net Book Value at 31 December 2008 | 49,539 | - |
+------------------------------------+------------+-----------+
The additions to freehold investment properties in 2009 includes GBP104,000 of
internal works at owned properties and a property portfolio acquisition at Parc
Nantgarw, Treforest, at a cost of GBP4,591,000. The Nantgarw property was
purchased by Hawtin Park Developments Limited.
The fair value of investment properties at 31 December 2009 has been arrived at
in accordance with IAS40 by the Directors after taking advice from Savills, GL
Hearn and Cooke and Arkwright.
The valuations were at open market value on an existing use basis and were
arrived at by reference to market evidence of transactions for similar
properties. The Group has pledged substantially all of its investment properties
to secure funding for the Group. The property rental income earned by the Group
from its investment property, which is leased under operating leases, amounted
to GBP4,142,000 (2008 - GBP3,867,000). Direct operating expenses arising on the
investment property in the period amounted to GBP987,000 (2008 - GBP874,000).
Direct costs attributable to vacant properties amounted to GBP422,000 for the
year (2008 - GBP378,000). At 31 December 2009, the Group had entered into no
contractual commitments to acquire property, plant and equipment or investment
properties (2008 - GBPnil).
7. BORROWINGS
a) Bank loans and overdrafts
The bank loans and overdrafts are secured by a fixed and floating charge over
certain assets of the Group, including investment properties, and are repayable
quarterly as follows according to the terms of the facilities:
+------------------------------------+----------+-----------+
| | 2009 | 2008 |
| | GBP000 | GBP000 |
+------------------------------------+----------+-----------+
| On demand or within one year - | 35,626 | 1,550 |
| loans | | |
+------------------------------------+----------+-----------+
| | - | 198 |
| - overdrafts | | |
+------------------------------------+----------+-----------+
| 1 - 2 years | 1,775 | 150 |
+------------------------------------+----------+-----------+
| 2 - 5 years | 450 | 24,769 |
+------------------------------------+----------+-----------+
| Over 5 years | 22,763 | 22,875 |
+------------------------------------+----------+-----------+
| | 60,614 | 49,542 |
+------------------------------------+----------+-----------+
| Less amounts due for settlement | | |
| within 12 months | | |
+------------------------------------+----------+-----------+
| (shown under current liabilities) | (60,614) | (47,917) |
+------------------------------------+----------+-----------+
| Long term borrowings | - | 1,625 |
+------------------------------------+----------+-----------+
The Directors consider that the carrying amount of bank loans and overdrafts
approximates to their fair value and are held at amortised cost. At 31 December
2009 the Group's bank loans were as follows:
(1) A 3 year term loan facility of GBP50,000,000 was agreed in May 2007. Funds
were drawn down during the year on two occasions which amounted in total to
GBP11,780,000. The facility has reduced from GBP50 million down to the
outstanding balance at the year end of GBP34.094 million, less an amortising
arrangement fee of GBP17,000, and GBP1.659 million of proceeds from the sale of
property are on deposit account waiting to be applied against the loan balance.
Interest is due quarterly in arrears and is charged at 3 month LIBOR plus a
margin of 1% which increased to 2% during the final quarter of the year. The
facility has been extended until July 2010.
(2) Crown Investments Limited had entered into a 10 year term loan in April
2006. The balance of the loan was GBP23.512million. The loan is subject to a
quarterly repayment of GBP37,500 and quarterly interest payable in arrears
charged at 3 month LIBOR plus the margin of 1.5%.
(3) Norfleet Property Holdings limited has entered into a GBP1,400,000 loan
with Principality Building Society, interest is paid monthly in arrears and
charged at 3 month LIBOR plus the margin of 3% subject to a minimum level of 4%.
This facility was extended for six months from September 2009 and in March 2010
was formally extended for five years.
(4) Hawtin Developments LLP has entered into a GBP3,250,000 loan with Allied
Irish Bank. The interest rate is 1.75% over base rate and expires in August
2011. The Hawtin Group share is 50%.
The revaluation of the investment properties together with payment defaults on
the Crown Investments Limited loan, as at 31 December 2009 resulted in breach of
terms of the Group borrowings. The loans are repayable on demand and have been
classified as due within twelve months.
b) Convertible loan notes
The convertible loan notes were issued on 31 July 2007 at an issue price of GBP1
per note. The notes are convertible into ordinary shares of the company at any
time between the date of issue of the notes and their settlement date. On issue,
the loan notes were convertible at 5.55 shares per GBP1 loan note. The
conversion price was at a 7.5% premium to the market value of the ordinary
shares at the date the convertible loan notes were issued. The loan notes were
unsecured.
If the loan notes had not been converted they will be redeemed on 31 July 2012
at par. Interest of 6.5% will be payable quarterly in arrears up until that
settlement date.
+------------------------------------+---------+---------+
| | | 2009 |
| | | GBP000 |
+------------------------------------+---------+---------+
| Loan notes in issue at 1 January | | 1,880 |
| 2009 | | |
+------------------------------------+---------+---------+
| Adjustment to debt component | | 250 |
+------------------------------------+---------+---------+
| Interest charged in the year | | (185) |
+------------------------------------+---------+---------+
| Interest paid in the year | | 185 |
+------------------------------------+---------+---------+
| Loan notes in issue at 31 December | | 2,130 |
| 2009 | | |
+------------------------------------+---------+---------+
The weighted average interest rates paid during the year before adjustments for
interest rate swaps were as follows:
+------------------------------------+---------+---------+
| | 2009 | 2008 |
| | % | % |
+------------------------------------+---------+---------+
| Bank loans and overdrafts | 5.22 | 6.49 |
+------------------------------------+---------+---------+
| Deferred consideration | - | 6.50 |
+------------------------------------+---------+---------+
| Convertible loan notes | 6.50 | 6.50 |
+------------------------------------+---------+---------+
c) Cumulative preference shares
Cumulative preference shares currently in issue total GBP549,000 are classified
as long term debt.
8. REPORT & ACCOUNTS AND ANNUAL GENERAL MEETING
The report and accounts for the year ended 31 Decermber 2009 are being sent to
shareholders and are available to be viewed on the Company's website
www.hawtin.co.uk. The Annual General Meeting will be held at 11.00 am on 30
June 2010 in Cardiff.
E-mail: info@hawtin.co.uk
Enquiries:
Hawtin PLC:
Nicola Crickmore, Company Secretary Tel: 01633 682130
Seymour Pierce Ltd:
David Foreman Tel: 020
7107 8010
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR SSUFLLFSSEFM
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