Ace Liberty & Stone - Final Results
RNS Number : 0118B
Ace Liberty & Stone PLC
05 October 2020
 

 

EMBARGOED UNTIL 7 A.M. Monday 5 October

Ace Liberty and Stone plc

(''Ace'' or "the Company'')

FINAL RESULTS FOR THE YEAR ENDED 30 APRIL 2020

 

Well-placed to thrive in turbulent times

Benefits expected from renewed interest in regional hubs

 

Ace Liberty and Stone Plc (AQSE: ALSP), the active property investment company capitalising on commercial property investment opportunities across the UK, is delighted to announce its results for the year ended 30 April 2020. 

 

 

Financial Highlights:

·      Revenue for the year up 26.0% to £6,391,897 (FY2019: £5,072,435)

·      Improved debt / equity ratio at 163% (FY2019: 289%)

·      Increased shareholders' funds of £31,647,257 (FY2019: 21,170,030) (49.5% increase)

·      Increased cash resources of £7,432,958 (FY2019: £1,956,742)

 

 

Operational Highlights:

·      Tenancies of local and national government departments stable at 58% (FY2019: 59%), ensuring continuity of income

·      Sale of Hillcrest House, Leeds arranged at £2,300,000 (purchased for £1,450,000)

·      Property purchases since year end totaling £3,140,000 yielding 8.3% with long term bank and building society tenants

·      These transactions show Ace's proactive investment and trading strategy in action; finding multi-use and attractive locations with strong rental agreements and well established, mainly governmental, tenants - many of whom provide essential services to the British public.

 

 

Ismail Ghandour, Chief Executive Officer, commented:

 

"Coronavirus has caused a rethink on the use of office space.  Our focus has always been on regional hubs across the country rather than prestigious central London properties which now look vulnerable to the expansion of working from home.

 

"We have a strong, stable position with a healthy balance sheet and good cashflow. This sets us up to explore further opportunities, even in this unusual economic and political situation."

 

 

-ends-

 

 

 

For further information, please contact:

 

Ace Liberty & Stone Plc

 

Ivan Minter, Financial Director

Tel: +44 (0) 20 7201 8340

 

http://acelibertyandstone.com

 

 

Alfred Henry Corporate Finance Ltd,

AQSE Growth Market Corporate Adviser

 

Jon Isaacs / Nick Michaels

Tel: +44 (0) 20 3772 0021

 

www.alfredhenry.com

 

 

Belvedere Communications

 

John West /Llew Angus

Tel: +44 (0) 20 3687 2756

 

www.belvederepr.com

 

 

SP Angel Corporate Finance LLP

Broker

 

Vadim Alexandre / Rob Rees

Tel: +44 (0)20 3470 0470

 

www.spangel.co.uk  

 

 

ACF Equity Research

 

Christopher Nicholson / Amalia Barnoschi

Tel: +44 (0) 20 7558 8974

 

www.acfequityresearch.com

 

 

 

 

 

Chairman's Statement

 

It is with great pleasure that I recommend this Annual Report which shows the Group in a solid position. The Group has followed a consistent policy over the past five years and there is comprehensive information in the document which supports the views I have expressed here. I commend it to your study, especially the Strategic Report and the Key Performance Indicators.

 

Reviewing my previous statement in the light of subsequent events, especially the COVID 19 pandemic, shows that the directors' policy of cautious expansion outlined then was exactly what was needed.

 

My statement of last year detailed the strength of the Company at that point. Early in 2019, the directors decided to buy no further properties for a short period, but enjoy the annual rental income of some £6.5m from the existing portfolio without devoting resources to further growth.

 

With hindsight, this has proved to be an excellent decision.

 

During the year under review the Group made no property acquisitions. However, taking advantage of easing property prices, it has now acquired 16-17 Westborough, Scarborough, North Yorkshire for £1,430,000 partly financed by a secured loan of £625,000 from Coutts & Co. The tenant is Skipton Building Society with a passing rent of £131,000 p.a. The Group has also exchanged contracts for the irrevocable purchase of 78/82 English Street and 49/53 Blackfriar Street, Carlisle at a price of £1,710,000 with completion by 7 December 2020. The main tenant is Clydesdale Bank plc with a rent of £120,000 p.a. Both properties have long unexpired leases with very creditworthy tenants and further reinforce our ownership strategy.

 

The Group has acted to improve its debt / equity ratio. At 30 April 2019 it stood at 289%; at 30 April 2020 it was 163%. The 5% CLN issued in January 2018 matured in December 2019 and by 30 April 2020 £3,838,700 had been converted into equity by means of conversion or exercise of associated warrants. £875,000 was still outstanding at that date, having been rolled over on the existing terms. In April 2020 the Company agreed to offer the holders of the 7% Loan the option of converting their holdings into shares to be issued at 50p. Holders of loans totalling £2,200,000 agreed, leaving £1,000,000 outstanding. These actions have greatly strengthened the Group balance sheet and removed a substantial liability for capital repayments and interest liabilities when it is in Ace's best interests to conserve its cash resources.

 

In the autumn of 2019, the directors became aware there was substantial investor demand for the Company's shares in Lebanon. Accordingly, the directors exercised their options over 6,983,333 shares and sold them into the market. This simultaneously raised cash for the Group's activities and removed the overhang to the market.

 

In early 2020, it became apparent to the Directors that the Covid 19 virus would have a substantial, but then unquantified, impact on the UK economy. As a matter of prudence they decided to suspend dividend declarations temporarily to conserve cash resources.

 

The Group collected 82% of the rents due to it at the March quarter day and made agreements with those tenants whose businesses were badly affected by the lockdown to allow deferral of payments until activity returned to normal with all arrears collectible by December 2021. One tenant subsequently entered into a Creditors' Voluntary Arrangement and this will result in the loss to the Group of approximately £78,000 in rental income. With this one exception, all the Group's tenants have resilient business activities and their ongoing ability to pay their rent is undiminished.

 

Forecasting the future is a perilous occupation. However three things are clear;

1.     The economic consequences of the pandemic will be far-reaching and opportunities will arise out of the ensuing turbulence.

2.     The Companies which are in the best position to respond are those with strong balance sheets and cash resources.

3.     Ace has a robust property portfolio with substantial cash balances and is looking to take advantage of any opportunities which arise.

We look forward to the next year with great confidence.

 

Dr Tony Ghorayeb

Chairman

Date:  2nd October 2020

 

 

 

Consolidated Statement of Comprehensive Income for the year ended 30 April 2020

 

 

 

2020

 

2019

 

 

 

£

 

£

 

 

 

 

 

 

 

 

6,391,897

 

5,072,435

 

(13,026)

 

284,138

 

(1,805,592)

 

(1,827,857)

 

(500,000)

 

1,247,371

 

(300,000)

 

(320,079)

 

173,375

 

 

 

(3,972,244)

 

(3,354,830)

 

34,842

 

5,511

 

-

 

(347,726)

 

9,252

 

758,963

 

111,113

 

6,754

 

120,365

 

765,717

Other comprehensive income

 

341,604

 

48,845

Total comprehensive income for the period

 

461,969

 

814,562

 

 

 

 

 

 

 

 

 

 

461,969

 

814,562

                   

 

 

Pence

 

Pence

2

0.97

 

1.97

2

0.75

 

1.15

 

 

 

 

Consolidated Statement of Financial position at 30 April 2020

 

 

 

2020

 

2019

 

ASSETS

 

£

 

£

 

Non-current assets

 

 

 

 

 

Investment property

 

76,888,096

 

79,538,096

 

Deferred tax

 

7,054

 

-

 

 

 

76,895,150

 

79,538,096

 

Current assets

 

 

 

 

 

Assets held for sale

 

10,429,921

 

8,784,921

 

Trade and other receivables

 

789,256

 

510,490

 

Cash and cash equivalents

 

7,432,958

 

1,956,742

 

 

18,652,135

 

11,252,153

 

 

 

 

 

 

95,547,285

 

90,790,249

 

 

 

 

 

 

EQUITY AND LIABILITIES

 

 

 

 

 

Current liabilities

 

 

 

 

 

Liabilities relating to

 

 

 

 

 

assets held for sale

 

1,350,625

 

1,440,125

 

Trade and other payables

 

5,536,009

 

4,833,381

 

Taxation

 

100,121

 

96,681

 

Borrowings

 

2,668,972

 

15,921,701

 

 

 

9,655,727

 

22,291,888

 

Non-current liabilities

 

 

 

 

 

Borrowings

 

54,244,301

 

47,212,143

 

Deferred tax

 

-

 

116,188

 

 

 

54,244,301

 

47,328,331

 

 

 

 

 

 

 

Share capital

 

14,626,463

 

10,608,342

 

Share premium

 

16,773,712

 

9,099,025

 

Share option reserve

 

-

 

826,906

 

Other reserve

 

211,185

 

341,603

 

Treasury shares

 

(480,620)

 

(480,620)

 

Retained earnings

 

516,517

 

774,774

 

Total equity

 

31,647,257

 

21,170,030

 

 

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

95,547,285

 

90,790,249

           

 

 

 

Consolidated Cash Flow Statement for the year ended 30 April 2020

 

 

 

 

 

2020

 

2019

 

 

 

 

 

 

£

 

£

 

Profit before tax

 

 

 

 

9,252

 

758,963

 

 

 

 

 

 

 

 

 

 

Cash flow from operating activities

 

 

 

 

 

 

 

 

Adjustments for:

 

 

 

 

 

 

 

 

Finance income

 

 

 

 

(34,842)

 

(5,511)

 

 

 

 

 

3,972,244

 

3,354,830

 

 

 

 

 

13,026

 

(284,138)

 

Fair value adjustment

 

 

 

 

800,000

 

(927,292)

 

Decrease / (Increase)  in receivables

 

 

 

 

(278,766)

 

423,989

 

Increase in payables

 

 

 

 

702,627

 

1,558,525

 

Tax paid

 

 

 

 

(8,809)

 

(156,977)

 

Interest paid

 

 

 

 

(2,547,166)

 

(1,459,868)

 

Other finance costs paid

 

 

 

 

(745,631)

 

(365,562)

 

Share based payment charge

 

 

 

 

-

 

347,726

 

  Net cash generated by operating activities

 

 

1,881,935

 

3,253,685

 

 

 

 

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

 

 

 

Interest received

 

 

 

 

34,842

 

5,511

 

Purchase of investment properties

 

 

 

 

-

 

(32,952,499)

 

Sale of investment properties

 

 

 

 

205,000

 

4,063,138

 

Net cash used by investing activities

 

 

 

239,842

 

(28,883,850)

 

 

 

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

 

 

 

Share issue, net of issue costs

 

 

 

 

6,104,665

 

-

 

Long term loans advanced

 

 

 

 

-

 

23,415,375

 

Long term loans repaid

 

 

 

 

(1,480,000)

 

(690,000)

 

Short term loans advanced

 

 

 

 

-

 

1,440,125

 

Short term loans repaid

 

 

 

 

(550,000)

 

(665,705)

 

Equity dividend paid

 

 

 

 

(720,226)

 

(1,093,113)

 

Net cash generated by financing activities

 

 

 

3,354,439

 

22,406,682

 

 

 

 

 

 

 

 

 

 

Net (decrease) / increase in cash and cash equivalents

 

 

5,476,216

 

(3,223,483)

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at the beginning of the period

 

 

1,956,742

 

5,180,225

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents at the end of the period

 

 

7,432,958

 

1,956,742

 

 

 

 

 

 

 

 

 

 

                     

 

 

NOTES TO PRELIMINARY RESULTS FOR THE PERIOD ENDED 30 APRIL 2020

 

1.         The financial information set out above does not constitute statutory accounts for the purpose of Section 434 of the Companies Act 2006.   The financial information has been extracted from the statutory accounts of Ace Liberty & Stone Plc and is presented using the same accounting policies, which have not yet been filed with the Registrar of companies, but on which the auditors gave an unqualified report on 2nd October 2020.

 

The preliminary announcement of the results for the year ended 30 April 2019 was approved by the board of directors on 2nd October 2020.

 

2.         Earnings per Share

 

 

 

 

 

The calculations of earnings per share are based on the following earnings and numbers of shares.

 

 

 

 

£

 

£

 

Profit for the period attributable to equity owners

 

461,969

 

814,562

 

 

 

 

No. of shares of 25p

 

No. of shares of 25p

 

Weighted average number of shares

 

 

 

 

 

For basic earnings per share

 

47,609,342

 

41,245,673

 

Dilutive effect of share options

 

14,312,252

 

29,837,805

 

For diluted earnings per share

 

61,921,594

 

71,083,478

 

Earnings per share

 

pence

 

pence

 

Basic

 

0.97

 

1.97

 

Diluted

 

0.75

 

1.15

 

 

 

£

 

£

 

Dividends declared during the year - per share of 25p

 

0.025

 

0.0291

 

Dividends declared during the year - total

 

731,725

 

1,196,786

 

 

 

 

 

- ends -

 

 

The Directors accept responsibility for this announcement.

 

 

Notes to Editors

 

Ace Liberty & Stone Plc is a property investment company with a diverse portfolio of properties located across the UK, predominantly in the midlands and north of England, which are now the focus of Government incentives. The Company locates commercial properties which have creditworthy tenants, several years' rental income and the potential for an increase in value through creative asset management activity, such as change of tenancy, change of use or new lease negotiation.  Ace has maintained a track record of generating strong profits at disposal of properties and achieving better-than average returns on capital. With strong support from shareholders and mortgage lenders, the Company is currently seeking to deploy its strong balance sheet and is seeking further investment opportunities in the UK to create value for existing and new investors.

 

Ace is run by a board with extensive property experience, an excellent network of contacts and relevant professional qualifications. This sector expertise has allowed the Board to identify opportunities and act promptly to secure investments.

 

For more information on the Company please visit www.acelibertyandstone.com

 

 

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