TIDMPNS
RNS Number : 4517N
Panther Securities PLC
30 September 2021
Prior to publication, the information contained within this
announcement was deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 ("MAR"). With the publication of this announcement,
this information is now considered to be in the public domain.
Panther Securities PLC
Interim Report - Six months ended 30 June 2021
Chairman's Statement
I am once again pleased to report our results for the six months
ended 30 June 2021. We show profit of GBP8,856,000 after a tax
expense of GBP2,722,000, compared to a loss of GBP8,049,000 after a
tax credit of GBP2,269,000 for the first half of 2020. Both of
these periods contained much distortion to our business due to the
effects of the coronavirus pandemic.
However, as with previous periods a great variance in the
figures is again determined by non-cash valuation movements
firstly, and mainly in this period, in relation to swap value
movements.
In February 2021, the Group paid GBP5 million to vary a
long-term swap agreement. The agreement varied was an interest rate
swap fixed at 5.06% until 31 August 2038 on a nominal value of
GBP35 million and has circa 17.5 years remaining. Following the
Group's variation, the Group's fixed rate will drop on 1 September
2023 to 3.40%, saving the Group GBP581,000 pa in cash flow until
the end-point of the instrument.
At 30 June 2021, there is a swap liability reduction compared to
that shown at 31 December 2020 of GBP14,326,000 due to the
combination of the benefit derived from our payment to vary this
swap and also an upward spike in the medium and long term interest
rates, thus improving our net asset value, which is 527p per share
as at 30 June 2021.
Secondly, although we do not normally independently revalue our
property portfolio for the half year accounts unless there is a
very significant event to justify the change (i.e., a sale at a
much higher price than book value at a slightly later date than the
half year cut-off date), we have done so in these accounts. Due to
the delay in completing the extremely extensive due diligence
requirements of our lenders who, not surprisingly, seemed
particularly cautious of the current commercial property investment
market, an independent updated valuation on the properties charged
to them was requested by the lenders.
This was despite having received an independent valuation by
their chosen valuers of the entire portfolio of charged properties
in January 2021 which was adopted for our last year end accounts.
This resulted in a further valuation increase of GBP1,213,000 which
was pleasing to us and deserved as our team are constantly working
to improve our rents and values.
Rents receivable during the current period were GBP6,447,000
compared to the previous year's first half of GBP6,836,000. This
was mainly due to concessions given to our tenants who suffered due
to the various lockdowns which are recognised in the period rather
than spread over the length of the lease. It is worth noting that
the relief was often not provided without something in return, be
it a break removal, lease extension or payment of significant back
dated arrears. For the latest quarter, our rents appear to be
recovering towards normal levels but we don't have enough data to
know whether this is the "new normal" but we hope this improvement
continues.
Another factor affecting the interim figures was our bad debt
provision. Following careful analysis we were able to reduce the
period bad debt charge to less than GBP750,000 compared to the
previous year's first half charge of circa GBP1,500,000. This was
provided for when many of our tenants faced an unknown future as to
whether they would survive in business because of forced cessation
of trade by lawful government efforts to halt or certainly try to
reduce the severe human impact of the deadly virus.
Disposals
We sold a freehold shop and premises in Sittingbourne to the
tenant for GBP450,000, approximately GBP100,000 over book value. To
facilitate the sale we lent the tenant GBP350,000 secured by a
first charge on the property. The loan was for three years and at a
profitable rate of interest to us.
Progress with Beales' former stores
As there has been considerable interest in this group of
properties, I have given a separate progress report on these
properties, as below.
The Peterborough and Southport stores are now occupied and
trading under the Beales banner (New Start 2020 Limited) under a
licence fee based on a percentage of turnover. Peterborough, which
sits on a site of 1.5 acres in the very centre of the town, has
substantial long term development prospects which we are currently
investigating.
Southport, although only recently reopened as a Beales store,
has made an excellent start and its presence will help to
regenerate the magnificent Victorian Wayfarers Arcade that adjoins
and interlinks with it, with the two buildings having a symbiotic
relationship to each other's success.
Skegness has been let in its entirety at a rent that gradually
rises to GBP150,000 pa and has been brought back into use as a
shopping and business centre for local traders. Its initial efforts
appear successful.
Beccles has been split into separate units and about one-third
of the space has been let to the well-known trader, Tool Station,
at GBP40,000 pa. There are negotiations in hand for other parts of
this building. We are looking to create as many as six additional
other units and we have interest from a local residential developer
in relation to them purchasing the upper parts.
Part of the Keighley store has been let to the Department of
Work & Pensions as a Job Centre at GBP55,000 pa for a term of
five years. This should help with the remaining half of the
building which adjoins the town's main shopping centre.
There are also three car parks attached to former Beales'
buildings producing revenue but it is early days to know what their
potential annual income will be.
Of the other stores, there are negotiations in hand, some for
sale and a few we are actively considering for redevelopment for
alternative purposes.
We believe that the ex-Beales stores owned by our Group will
contain some of our bigger opportunities to realise value. Firstly,
value will be derived due to the incredibly conservative valuations
they were recently given by the independent valuer and the
potential that they have from their sheer size, with many having
latent residential value. We also now have the ability to work on
them unhindered (previously we did not want to cause harm to our
already struggling tenant by taking away profitable stores). In
recent times we have still been hindered by a slow lettings market,
but we expect good progress over the next few years.
Acquisitions
In January 2021, we exchanged contracts to purchase a
substantial freehold factory and warehouse in Trowbridge,
Wiltshire, of approximately 96,000 sq.ft. of usable space situated
in approximately six acres of industrial land. This property is
situated on one of the best industrial estates in Trowbridge where
demand should be good. The contract price agreed is GBP3,300,000
with a delayed completion of between 15 and 30 months depending
upon timing of the completion of the vendors' new building. Should
it be necessary for a further delay, the vendors will pay a rent of
GBP340,000 per annum until they vacate.
This purchase will further diversify our portfolio by adding
this industrial investment. The spread and variety of rental
streams within our portfolio helped us to pass through the pandemic
with relatively few issues.
Developments
Barry Parade, Peckham Rye
The plans for this redevelopment of a local supermarket, shops
and fourteen flats have been agreed in its entirety, subject to
agreement on the Section 106 payment agreement on which Southwark
Council require over and above the normal conditions. This may
require an appeal.
Broadstairs
Whilst I had hoped this development would be fully completed by
now, there is a delay with the flats due to certain building
materials not being immediately available. However, on a brighter
note, the Tesco Express on the ground floor was completed in a
remarkably quick fit out time and opened for trade in July 2021. We
hope the twelve flats will be available for letting soon.
Swindon
Whilst everything with regard to the two planning permissions on
this central Swindon site has been agreed, progress has been
difficult due to the council requiring some impractical clauses in
the new 250 year lease, the financial terms of which were
previously provisionally agreed, thereby causing delays.
This is disappointing as these financial terms were agreed
before we expended over GBP200,000 in planning fees and
consultants, which nowadays is necessary to agree a suitable
building before even submitting for planning permission.
Whilst we hope to resolve these issues soon, the delay is
disappointing and detrimental to the local community's wish for
improvement to the former covered market site.
Loans
As at 30 June 2021, the refinance of our loan facility had not
been completed and therefore the loan is shown as a current
liability.
On 16 July 2021 we finally completed our refinance which
consisted of a GBP66,000,000 loan for a three year period, as a
club facility jointly lent by HSBC and Santander. The loan has a
term element of GBP55,000,000 and a more flexible revolving element
of GBP11,000,000 which gives us the ability to pay down and redraw
over the three year term. The GBP66,000,000 is currently fully
drawn and we therefore presently hold additional cash funds to that
shown at the period end. We are expecting to sell some properties,
possibly some of the Beales properties mentioned above, and any
disposal proceeds can be used to pay down our revolving facility
which will then provide us with additional liquidity to secure new
opportunities.
The new loan is a more conservative facility agreement than we
are used to with a headline loan-to-value covenant of 55%, when
historically it had been around 65% (which used to be considered
conservative!). The extra cautious nature shown by the lenders is
also reflected by the smaller loan facility arranged, previously we
borrowed GBP75,000,000 (now GBP66,000,000). The Bank's margin has
also increased from 1.95% to 2.70%. However, on 1 December 2021 we
have a prearranged reduction in our fixed rates, on GBP25 million
of our loan, the saving in lower fixed rates being a bigger offset
than the increase in costs from the new higher loan margins.
We understand the lenders' approach and the less generous terms
than we were able previously to arrange, as well as the more
vigorous process, as this was refinanced in a pandemic. The
pandemic was a torrid time for most businesses which also brought
significant change, and the speed of change in particular has added
to the question marks on particular asset classes. However, we
still see a bright future for the property industry, especially for
companies who, like us, can be flexible in their approach and
careful on their purchases. Most properties can be altered to other
uses and given enough time, a profitable outcome is achievable.
Even though this was a much tougher and less generous
refinancing, we appreciate our lenders and do not take their
continuing support for granted. We have had a very amicable banking
relationship with HSBC for nearly 40 years, and Santander for over
10 years. This refinancing was the third iteration of this joint
club loan.
Dividends
We paid our 6p per share interim dividend for the year ended 31
December 2020 in the period, which reached our shareholders on 2
July 2021. This was paid following the Group receiving full credit
approval for our refinance.
We are due to pay a further 6p per share final dividend for the
year ended 31 December 2020 on 14 October 2021 (ex-dividend on 2
September 2021) which is accrued in these accounts.
Given the progress made to date we hope to be able to maintain
our dividend and will look to pay an interim dividend for the year
ending 31 December 2021 of 6p per share on 9 February 2022 for
those on the register at 7 January 2022 (ex-dividend 6 January
2022), although the formal declaration of such a dividend will be
subject to the Board's assessment at a point later this year of the
financial effects of COVID-19 on our Group. A further announcement
will be made in due course.
The Near Future
I am sure I have previously mentioned a Chinese quote sometimes
said on departing from business meetings, "May you live in
interesting times". Many people thought this was a form of verbal
pleasantry for people but, of course, this is actually a curse.
We are currently living in these "interesting times" and it will
be some time before the comfort of normality returns.
Andrew S Perloff
Chairman
30 September 2021
Chairman's Ramblings
As for most people, this year has been a very difficult one.
Things have been postponed, delayed or cancelled due to Covid,
including my ramblings which nearly fell by the wayside.
The more I learned of the inconsistent and shambolic way in
which the Government was dealing with the situation, the more
furious I became and was enraged even further by the government's
measures on taxation.
I have long held the belief that most of a country's problems
are caused by the politicians and their advisers, all of whom seem
to be inexperienced with little understanding of the potential
repercussions of the taxes and laws they impose.
Whilst on my delayed summer holiday, I started a long rambling
rant of annoyance. After a few attempts I eventually gave up and
considered abandoning my ramblings altogether feeling no one would
take any notice anyway. My journey home gave me reason to
reconsider.
We had loaded the car and left Antibes on a beautiful morning -
perfect for the long drive home. We had had the obligatory Covid
test outside a local, well organised pharmacy who sent us our
results by phone within the hour. So far, so good.
After about three hours of driving and pleased with our good
progress we stopped at a picnic area to have some lunch.
We continued our journey in good spirits - noticing but
dismissing (a decision we would later regret) a warning about
traffic jams on the road ahead. We thought a small delay would be
preferable to a long detour as the French police were excellent at
clearing accidents quickly, smashing through central reservations
and instigating contraflow systems should it be necessary. Maybe we
should have obeyed the detour signs as within about 30 minutes
things started to s-l-o-w. All five lanes of the motorway came to a
standstill and about an hour later then started to move at a pace
that would make a snail seem like Usain Bolt.
This reminded me of a previous experience of the Autoroute de
Soleil (which I had told my wife so many times she knew it better
than I did even reminding me of bits I had omitted before she fell
into a deep sleep). I had unwisely decided to travel south during
the start of August along with everyone else in Europe. The traffic
was heavy and slow moving from the outset but after passing Lyons
it came to a virtual standstill. Two extremely hot and bothered
gendarmes were directing two out of four lanes of cars, which
included me, off the motorway. In those days before the wonders of
GPS were even imagined, I was rather nervous and only knew my way
to the south by the motorway. I pulled up to the nearest gendarme
map in hand and tried to explain why I should stay on the motorway
in a mixture of loud English and the international language of
pointing. In full uniform, with a temperature in the 90s, his face
reddening, and with a suitable complement of French curses, he
smashed the map out of my hands onto the road. My then wife and
young children gasped in horror. I calmly tried to explain my
dilemma again but with a speed to rival Billy the Kid he pulled his
gun out, pointed it at me shouting "Allez! Allez!". "Do it! Do it!"
my then wife shouted. In the intervening years I often wonder if
she was instructing the gendarme or me. Needless to say I allez-ed
tres rapidement.
Despite my fears at getting lost in France, we successfully
reached our destination via the RN7 after an overnight stay in a
charming little pension and a very picturesque albeit longer
journey.
Our current trip was also proving difficult. Three long hours
slowly passed and we had only travelled about two miles when a new
problem arose. My wife informed me quite calmly that nature was
calling, albeit not very loudly at present. After about half an
hour the call became somewhat louder and more insistent. Soon calm
was replaced by desperation - plastic bags and bottles were
mentioned. The motorway was five lanes wide. The nearside three
lanes were packed with lorries so at least I now know where all the
missing lorry drivers are.
I gradually managed to manoeuvre from the outside to the inside
lane hoping to see some escape for her as her desperation was
increasing. I suggested that she could make a dash to the side of
the road as the traffic was stationary and not to worry about the
twenty or so truck drivers that might see her. She said she'd
prefer her bladder to burst than risk that indignity - someone
might film her and put it on YouTube!
Having moved at a snail's pace for a further half an hour, an
emergency layby came into view ahead. Two large lorries were
already parked there but I felt we could squeeze in just behind
them. This took another ten minutes. My wife then said she did not
care if viewing her bum broke the internet and was seen by everyone
on earth so desperate was she. She leapt out after grabbing one of
the four coats she had brought with her (in case the South of
France weather changed) for modesty's sake and went behind the
lorries with me opening two car doors to shield her from the lorry
drivers behind us.
She got back into the car weak with RELIEF.
I manoeuvred back into the queue and my wife said "Never mind
happiness, joy, contentment etc., relief is the most wonderful
feeling in the world". We talked about the different types of
relief; the sound of your daughter's key in the door at 3.00 a.m.,
the doctor saying "It's negative", swerving and missing the child
who runs out in front of your car. These are wonderful examples of
emotion, which surely shows the best feeling is RELIEF.
Nature's voice was now stilled and we passed the next three
hours in the slow moving traffic until the five lanes gradually
merged into one and we were sent off the motorway with no gun
waving gendarmes in sight.
Darkness fell and while peacefully and slowly travelling down
the back roads off the motorway, my thoughts turned to business and
in particular RELIEF.
I pondered on how greedy government tax policies had destroyed
85% of the department store sector which had a huge impact on town
centres particularly those in the north. Rather than talk
platitudes of levelling up, when it comes to business rates all
High Street traders should be instantly granted RELIEF!
My thoughts also drifted to the myriad of requirements needed to
rebuild our decaying town centres and build more housing.
Dictatorial town planners and councillors inflated the legal
requirements and insisted on excessive payments before granting
planning permission. Central government could overrule all this to
grant RELIEF.
The iniquitous stamp duty on larger homes depress the market and
prevent mobility so that many homes are underutilised as the tax
costs of moving far outweigh the benefits. It would be useful if
this stamp duty tax was reduced by way of RELIEF.
Many companies have pension funds that, due to excessive
government regulations, have to invest in government debt whose
interest rates are artificially held down at rates bearing no
relationship to inflation nor provide a proper return. If strict
regulations on pensions funds were removed or alleviated it would
give many businesses some RELIEF.
Local councils have helped to destroy the town centres by
over-charging for town centre parking, too many speed cameras, bus
lanes which are hardly used, cycle lanes also lightly used by
uninsured cyclists who don't obey their own rules of the road.
Changing these arrangements would give both the motorist and
transporting public RELIEF.
Capital gains tax could be tapered down to nil over a 15 year
period. This would help stop foreign firms buying up Britain at
current depressed prices, with other people's money, and encourage
long term investing and stop the dicing and slicing of businesses
for a quick profit detrimental to the overall business. It would be
simple to grant this RELIEF.
1% of the taxpayers who are the highest earners pay about 30% of
total income taxes. If inheritance tax should be no more than 15%
of the total estate, then maybe over 100,000 high worth individuals
may come back into the UK and its tax fold producing a large gain
to the country's revenue and a similar amount of people may not
leave the country for tax reasons. This would only lose a small
amount of tax initially and in due course increase the tax take and
thus be a useful RELIEF.
Banks, solicitors and accountants have to enforce a myriad of
'Know Your Client' and money laundering regulations which drive
genuine, honest, business and private customers away, who feel
driven to put their money into make-believe currencies. Banks and
customers would all benefit if banks were granted regulation
RELIEF.
The UK population have heavy climate change taxes but even if
the UK stopped all carbon dioxide emissions, as we only produce 1%
of world emissions it would make no overall difference as China
would take up the slack within six months and all the while produce
goods cheaper than the UK because of much cheaper energy costs.
That's why our steel industry collapsed. Thus we should all be
granted climate change tax RELIEF.
We have the 'woke' brigade, who protest making a loud noise, but
only from a small minority of the population. Government could
ignore some of these daft protests and demands and also newspapers
stop giving the protestors the oxygen of publicity, this would be a
RELIEF.
I have mentioned nine desired reliefs and I could go on for many
more but no doubt my shareholders will be pleased to know I will
save these for another day thus giving shareholders some current
RELIEF!
Yours
Andrew S Perloff
Chairman
30 September 2021
Panther Securities P.L.C.
CONDENSED CONSOLIDATED INCOME STATEMENT
for the six months ended 30 June 2021
Notes Six months Six months Year
ended ended ended
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Revenue 2 6,447 6,836 13,051
Cost of sales 2 (1,838) (1,435) (3,482)
----------- ----------- ------------
Gross profit 4,609 5,401 9,569
Other income 321 204 467
Administrative expenses (830) (742) (1,703)
Bad debt expense (658) (1,474) (1,629)
----------- ----------- ------------
Operating profit 3,442 3,389 6,704
Profit on disposal of investment properties 88 25 150
Movement in fair value of investment
properties 6 1,213 (6,929) 6,146
----------- ----------- ------------
4,743 (3,515) 13,000
Finance costs - interest (969) (1,194) (2,283)
Finance costs - swap interest (1,439) (1,280) (2,726)
Finance costs - swap variation 7 (5,000) - -
Investment income 17 24 41
Profit on disposal of fixed assets - - 1
Impairment of investments (shares) - (504) -
(Loss)/ profit realised on the disposal
of investments (shares) (100) - 38
Fair value gain/ (loss) on derivative
financial liabilities 7 14,326 (3,849) (5,498)
----------- ----------- ------------
Profit/ (loss) before income tax 11,578 (10,318) 2,573
Income tax (expense)/ income 3 (2,722) 2,269 71
----------- ----------- ------------
Profit/ (loss) for the period 8,856 (8,049) 2,644
=========== =========== ============
Earnings/ (loss) per share
Basic and diluted - continuing operations 5 50.1p (45.5)p 14.9p
----------- ----------- ------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 June 2021
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Profit/ (loss) for the period 8,856 (8,049) 2,644
----------- ----------- ------------
Items that will not be reclassified
subsequently to profit or loss
Movement in fair value of investments
taken to equity 77 - (354)
Deferred tax relating to movement in
fair value of investments taken to
equity (15) - 67
Realised fair value on disposal of
investments previously taken to equity 143 - -
Realised deferred tax relating to disposal
of investments previously taken to -
equity (27) -
-----------
Other comprehensive income/ (loss)
for the period, net of tax 178 - (287)
Total comprehensive income/ (loss)
for the period 9,034 (8,049) 2,357
----------- ----------- ------------
Attributable to:
Equity holders of the parent 9,034 (8,049) 2,357
9,034 (8,049) 2,357
----------- ----------- ------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Company number 293147
As at 30 June 2021
Notes 30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
ASSETS Unaudited Unaudited Audited
Non-current assets
Investment properties 6 182,031 166,290 180,975
Deferred tax asset 1,049 5,755 3,810
Right of use asset 335 351 335
Investments 335 1,016 614
---------- ---------- ------------
183,750 173,412 185,734
---------- ---------- ------------
Current assets
Stock properties 350 350 350
Investments 29 38 29
Trade and other receivables 3,873 4,276 3,925
Cash and cash equivalents (restricted) 1,052 1,052 1,052
Cash and cash equivalents 3,377 8,340 8,166
---------- ---------- ------------
8,681 14,056 13,552
Total assets 192,431 187,468 199,256
---------- ---------- ------------
EQUITY AND LIABILITIES
Equity attributable to equity holders
of the parent
Capital and reserves
Share capital 4,437 4,437 4,437
Share premium account 5,491 5,491 5,491
Treasury shares (213) (213) (213)
Capital redemption reserve 604 604 604
Retained earnings 82,835 65,517 75,923
Total equity 93,154 75,836 86,242
---------- ---------- ------------
Non-current liabilities
Long-term borrowings 7 18 78 51
Derivative financial liability 7 17,683 30,360 32,009
Leases 8,339 7,912 8,339
---------- ---------- ------------
26,040 38,350 40,399
Current liabilities
Trade and other payables 8,922 9,169 9,361
Accrued dividend payable 4 1,061 1,061 -
Short-term borrowings 7 63,066 62,996 63,066
Current tax payable 188 56 188
---------- ---------- ------------
73,237 73,282 72,615
Total liabilities 99,277 111,632 113,014
---------- ---------- ------------
Total equity and liabilities 192,431 187,468 199,256
---------- ---------- ------------
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2021
Capital
Share Share Treasury redemption Retained
capital premium shares reserve earnings Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Balance at 1 January
2020 (audited) 4,437 5,491 (213) 604 74,627 84,946
Total comprehensive
loss for the period - - - - (8,049) (8,049)
Dividends due - - - - (1,061) (1,061)
--------- --------- ----------- ------------ ---------- --------
Balance at 30 June
2020 (unaudited) 4,437 5,491 (213) 604 65,517 75,836
--------- --------- ----------- ------------ ---------- --------
Balance at 1 January
2020 (audited) 4,437 5,491 (213) 604 74,627 84,946
Total comprehensive
income for the period - - - - 2,357 2,357
Dividends paid - - - - (1,061) (1,061)
--------- --------- ----------- ------------ ---------- --------
Balance at 1 January
2021 (audited) 4,437 5,491 (213) 604 75,923 86,242
Total comprehensive
income for the period - - - - 9,034 9,034
Dividends paid - - - - (1,061) (1,061)
Dividends due - - - - (1,061) (1,061)
Balance at 30 June
2021 (unaudited) 4,437 5,491 (213) 604 82,835 93,154
========= ========= =========== ============ ========== ========
Panther Securities P.L.C.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
for the six months ended 30 June 2021
Notes 30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Cash flows from operating activities
Operating profit 3,442 3,389 6,704
Add: Depreciation and interest - right -
to use asset - 22
Add: Loss on current asset investments*** - 79 87
Less: Rent paid treated as interest (343) (325) (687)
Profit before working capital change 3,099 3,165 6,104
Decrease in stock investments - 130 -
Decrease/ (increase) in receivables 351 (887) (536)
(Decrease)/ increase in payables (104) 630 783
---------- ---------- ------------
Cash generated from operations 3,346 3,038 6,351
Interest paid (2,064) (2,067) (4,160)
Income tax paid - 475 420
---------- ---------- ------------
Net cash generated from operating activities 1,282 1,446 2,611
Cash flows from investing activities
Purchase of investment properties (569) (4,104) (5,538)
Purchase of investments** (6) (593) (633)
Purchase of current asset investments*** - (2,936) (2,804)
Proceeds from current asset investments*** - 2,857 2,855
Proceeds from sales of fixed assets - - 1
Proceeds from sale of investment property 178 250 700
Proceeds from sale of investments** 403 - 631
Dividend income received 17 15 32
Interest income received - 9 9
---------- ---------- ------------
Net cash used in from investing activities 23 (4,502) (4,747)
Cash flows from financing activities
New loans received - 4,000 4,000
Finance cost (SWAP variation) (5,000) - -
Repayments of loans (33) (1,037) (1,070)
Dividends paid (1,061) - (1,061)
Net cash generated (used in)/ from financing
activities (6,094) 2,963 1,869
Net decrease in cash and cash equivalents (4,789) (93) (267)
Cash and cash equivalents at the beginning
of period* 9,218 9,485 9,485
Cash and cash equivalents at the end
of period* 4,429 9,392 9,218
---------- ---------- ------------
* Of this balance GBP1,052,000 (30 June 2020: GBP1,052,000, 31
December 2020: GBP1,052,000) is restricted by the Group's lenders
i.e. it can only be used for the purchase of investment property
(or otherwise by agreement).
** Shares in listed and/or unlisted companies. These were held
for longer term growth and dividend return.
*** Shares in listed and/or unlisted companies but held for
trading purposes. These were bought in order to make short term
trading profit.
1. Basis of preparation of interim financial statements
The results for the year ended 31 December 2020 have been
audited whilst the results for the six months ended 30 June 2020
and 30 June 2021 are unaudited.
The financial information set out in this interim financial
report does not constitute statutory accounts as defined in Section
434 of the Companies Act 2006. The Group's statutory accounts for
the year ended 31 December 2020 which were prepared under
International Financial Reporting Standards ("IFRS") as adopted for
use in the European Union, were filed with the Registrar of
Companies. The auditors reported on these accounts, their report
was unqualified and did not included a reference to any matters to
which the auditors drew attention by way of emphasis without
qualifying report and did not contain any statements under Section
498 (2) or Section 498 (3) of the Companies Act 2006.
These condensed consolidated interim financial statements are
for the six month period ended 30 June 2021. They have been
prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006. IFRS is
subject to amendment and interpretation by the International
Accounting Standards Board ("IASB") and the IFRS Interpretations
Committee and there is an ongoing process of review and approved by
the UK Endorsement Board. The financial information has been
prepared on the basis of IFRS that the Board of Directors expect to
be applicable as at 31 December 2021.
A number of new and amended standards and interpretations are
effective from 1 January 2021 but they do not have a material
effect on the Group's financial statements.
2. Revenue and cost of sales
The Group's only operating segment is investment and dealing in
property and securities. All revenue, cost of sales and profit or
loss before taxation is generated in the United Kingdom. The Group
is not reliant on any key customers.
3. Income tax expense
The charge for taxation comprises the following:
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Current period UK corporation
tax - (182) (310)
Prior period UK corporation
tax - - (58)
---------- ---------- ------------
- (182) (368)
Current period deferred
tax (expense)/credit (2,722) 2,451 439
---------- ---------- ------------
Income tax (expense) /
credit for the period (2,722) 2,269 71
========== ========== ============
The taxation charge is calculated by applying the Directors'
best estimate of the annual effective tax rate to the profit for
the period.
4. Dividends
Amounts recognised as distributions to equity holders in the
period:
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Final dividend for the
year ended 31 December
2020 of 6p (2019 - 6p)
per share 1,061* *1,061 1,061
Interim dividend for the
year ended 31 December 1,061 - -
2020 of 6p per share
2,122 1,061 1,061
========== ========== ============
The final dividend of 6p per share for the year ended 31
December 2020 (and 2019) was not paid during the period to 30 June
2021 but declared and approved (being accrued in these accounts)
and will be paid on 14 October 2021 (7 September 2020).
*Accrued at half year and paid after period end.
5. Earnings/ (loss) per ordinary share (basic and diluted)
The calculation of basic and diluted earnings per ordinary share
is based on earnings being a profit of GBP8,856,000 (30 June 2020 -
loss of GBP8,049,000 and 31 December 2020 - profit of
GBP2,644,000).
The basic earnings per share is based on the weighted average of
the ordinary shares in existence throughout the period, being
17,683,469 to 30 June 2021 (17,683,469 to 31 December 2020 and
17,683,469 to 30 June 2020). There are no potential shares in
existence for any period and therefore diluted and basic earnings
per share are equal.
Panther Securities PLC owns 63,460 ordinary shares which are
currently held in treasury (2020 - 63,460).
6. Investment properties
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Fair value of investment
properties
At 1 January 180,975 169,340 169,340
Additions 233 4,104 5,538
Disposals (390) (225) (550)
Fair value adjustment
on investment properties
held on leases - - 501
Revaluation increase/
(decrease) 1,213 (6,929) 6,146
At 31 December 182,031 166,290 180,975
========== ========== ============
As part of the Group's refinance, Carter Jonas updated their
valuation report in June 2021 for the lenders, originally prepared
for December 2020 and we have incorporated the movements in the
period ended 30 June 2021.
7. Derivative financial instruments
The main risks arising from the Group's financial instruments
are those related to interest rate movements. Whilst there are no
formal procedures for managing exposure to interest rate
fluctuations, the Board continually reviews the situation and makes
decisions accordingly. Hence, the Company will, as far as possible,
enter into fixed interest rate swap arrangements. The purpose of
such transactions is to manage the interest rate risks arising from
the Group's operations and its sources of finance.
30 June 30 June 31 December
2021 2020 2020
GBP'000 GBP'000 GBP'000
Bank loans Unaudited Rate Unaudited Rate Audited Rate
Interest is charged
as to:
Fixed/ Hedged
HSBC Bank plc* 35,000 7.01% 35,000 7.01% 35,000 7.01%
HSBC Bank plc** 25,000 6.58% 25,000 6.58% 25,000 6.58%
Unamortised loan - (78) -
arrangement fees
Floating element
HSBC Bank plc*** 3,000 3,000 3,000
Shawbrook Bank
plc 84 152 117
---------- ---------- ----------------
63,084 63,074 63,117
========== ========== ================
* Fixed rate came into effect on 1 September 2008. The rate
includes 1.95% margin. The contract includes mutual breaks, the
last being on 23 December 2019 (and every 5 years thereafter).
** This arrangement came into effect on 1 December 2011 when
HSBC exercised an option to enter the Group into this interest swap
arrangement. The rate includes a 1.95% margin. The duration is
until 1 December 2021.
Bank loans totalling GBP60,000,000 (2020 - GBP60,000,000) are
fixed using interest rate swaps removing the Group's exposure to
interest rate risk. Other borrowings are arranged at floating
rates, thus exposing the Group to cash flow interest rate risk.
The derivative financial assets and liabilities are designated
as held for trading.
Hedged Rate (without Duration 30 June 30 June 31 December
amount margin) of contract 2021 2020 2020
remaining Fair value Fair value Fair value
GBP'000 years GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
Derivative
financial liability
Interest rate
swap 35,000 5.060% 17.18 (14,169) (25,432) (26,577)
Interest rate
swap 25,000 4.630% 0.42 (512) (1,532) (1,100)
Interest rate
swap* 25,000 2.131% 10.00 (3,002) (3,396) (4,332)
------------
(17,683) (30,360) (32,009)
------------ ------------ ------------
Movement in derivative financial liabilities 14,326 (3,849) (5,498)
============ ============ ============
*This swap commences on 1 December 2021 when the GBP25,000,000
4.63% swap ceases. This swap is at a lower rate and will result in
an interest saving of circa GBP625,000 per annum compared to the
current structure.
The Group has paid GBP5m in February 2021 to vary a long-term
swap agreement. The agreement varied was an interest rate swap
fixed at 5.06% until 31 August 2038 on a nominal value of GBP35m
and has 17.18 years remaining at the period end date. Following the
variation, the Group's fixed rate will drop on 1 September 2023 to
3.40% saving the Group GBP581,000pa in cash flow until the end
point of the instrument.
As the Group's new loan facility entered into after the period
end is referenced to SONIA rather than LIBOR, the Group recently
altered its swap agreements onto the same basis.
Interest rate derivatives are shown at fair value in the
Statement of Financial Position, with charges in fair value taken
to the Income Statement. Interest rate swaps are classified as
level 2 in the fair value hierarchy specified in IFRS 13.
The vast majority of the derivative financial liabilities are
due in over one year and therefore they have been disclosed as all
due in over one year.
The above fair values are based on quotations from the Group's
banks and Directors' valuation.
Treasury management
The long-term funding of the Group is maintained by three main
methods, all with their own benefits. The Group has equity finance,
has surplus profits and cash flow which can be utilised and also
has loan facilities with financial institutions. The various
available sources provide the Group with more flexibility in
matching the suitable type of financing to the business activity
and ensure long-term capital requirements are satisfied.
Loan renewal
The Group's loan expired in April 2021 but was extended to July
2021 due to the disruptions of the COIVD-19 pandemic. The renewal
was therefore finalised in July 2021 so in these interim accounts
the loan is shown as a current liability.
8. Net asset value per share
30 June 30 June 31 December
2021 2020 2020
Unaudited Unaudited Audited
Basic and diluted 527p 429p 488p
========== ========== ============
9. Loan Renewal
On 16 July 2021, the Company completed the refinancing of its
loans. The new facility is a GBP66 million three year term loan, a
reduction from the previous GBP75 million facility, of which GBP11
million is on a revolving basis. The interest rate payable is 2.7
per cent. over SONIA.
10. Copies of this report are to be sent to all shareholders and
are available from the Company's registered office at Unicorn
House, Station Close, Potters Bar, EN6 1TL and will also be
available for download from our website www.pantherplc.com .
Panther Securities PLC +44 (0) 1707 667 300
Andrew Perloff, Chairman
Simon Peters, Finance Director
Allenby Capital Limited (Nomad) +44 (0) 20 3328 5656
David Worlidge
Alex Brearley
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END
IR FLFIDATIAFIL
(END) Dow Jones Newswires
September 30, 2021 02:00 ET (06:00 GMT)
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