Company Trafalgar New Homes PLC
TIDM TRAF Headline Final Results Released 12:39 28-
RNS Number : 2499Q
Trafalgar New Homes PLC
28 August 2014
TRAFALGAR NEW HOMES PLC
("Trafalgar", the "Company" or "Group")
FINAL RESULTS AND NOTICE OF AGM
Trafalgar (AIM: TRAF), the AIM quoted residential property developer operating in southeast England, announces the audited results for the year ended 31 March 2014.
HIGHLIGHTS:
· The year under review saw Group turnover at £3,368,500 (2013: £2,205,786), generating a gross profit of £293,446.
· After administrative expenses and provision of AIM listing costs of £250,653 incurred in moving the Company to AIM, the Group recorded a loss before tax of £305,049 (2013: Profit £617,976).
· Successful move of the Company from the ISDX Growth Market (formerly PLUS) to AIM concluded on the 16th July 2013.
· The move to AIM was with a view to, inter alia, increasing the profile of the Company and utilising the Company's shares as a further source of capital funding in the future. Indeed, in the current year, the Company announced the issue of 10m new ordinary shares of 1p each at a price of 2p per share and the shares issued were admitted to trading on AIM in July 2014.
· Sales of the remaining units at Oakhurst Park Gardens, along with the development and sale of the sites at Ticehurst and Borough Green, are expected to contribute to profitability for the current year.
· The revised planning application at Staplehurst, Kent on the first phase for permission for a 23 house development on approximately half of the site under Option, is with Maidstone Borough Council. An early positive outcome is expected. The development of this site will contribute substantially to the Group's profitability for the years ended March 2016 and March 2017, along with the development and sale of the sites owned at Tunbridge Wells and Sheerness, Kent.
Annual Report and Notice of AGM
The Company advises that the 2014 Annual General Meeting of the Company will be held at the offices of Allenby Capital Limited, 3 St. Helen's Place, London EC3A 6AB at 11.00 a.m. on 29 September 2014, notice of which will be contained in the Annual Report to be posted to shareholders next week. Copies of the Annual Report will also be available on the Company's website: www.trafalgar-
Enquiries:
Trafalgar New Homes Plc
Christopher Johnson
+44 (0)1732 700 000
Allenby Capital Ltd -
Jeremy Porter/James Reeve
+44 (0)20 3328 5656
Yellow Jersey PR Limited
Dominic Barretto/Anna Legge
+44 (0)7747 788 221
Notes to Editors:
Trafalgar New Homes is the holding company of Combe Bank Homes, a successful residential property developer operating in the southeast of England. The founders of Combe Bank Homes have a long track record of developing new and refurbished homes, principally in Kent. Combe Bank Homes was incorporated in 2006 and was acquired by ISDX quoted Trafalgar New Homes in a reverse takeover on 11 November 2011.
The Company's focus is on the select acquisition of land for residential property development. The Company outsources all development activities, for example the obtaining of planning permission, design and construction, and uses fixed price build contracts. This enables the Company to tightly control its development and overhead costs.
The Company focuses on the regions of Kent, Surrey, Sussex and the M25 ring south of London and targets development sites of up to 20 homes, with sales prices typically ranging from £100,000 to £750,000 per unit, although larger projects are undertaken.
For further information visit www.trafalgar-
TRAFALGAR NEW HOMES PLC
Annual report and consolidated financial statements for the year ended 31 March 2014
CHAIRMAN'S STATEMENT
The attached Report and Accounts for the Group for the year ended 31 March 2014 are very disappointing.
Business Environment
Trafalgar New Homes continues to specialise in small developments in Kent, Surrey, Sussex and the M25 ring south of London. The Board believes that this strategy positions the Group in a niche market place, between local builders and developers and larger house building companies in the high demand area of the South East.
As a Board, we are optimistic about the future prospects of the residential property market as activity has started to increase which we believe will benefit the Group over the coming year. Various campaigns by the Government, as well as an overall improvement in the residential property market are encouraging.
However, we have experienced significant delays and cost over-
Financials
The period under review saw Group turnover at £3,368,500 (2013: £2,205,786), with a loss before tax of £305,049 (2013: Profit £617,976). This loss is after providing for the AIM listing costs of £250,653. The underlying loss for the year was £205,843 (2013: Profit £559,732).
Land has been acquired to enable our development programme to continue profitably for 2015 and 2016.
Outlook
We have worked hard to put Trafalgar New Homes in a strong position as we aim to take advantage of an improvement in the sector.
Following our move from ISDX to AIM on 16 July 2013 we have raised a further £200,000 with a new share issue in June 2014.
I would like to take this opportunity to thank the staff and Board on their achievements, which have now laid the foundation for substantial future growth of Trafalgar New Homes. We have established a strong team, which is essential for our continued growth and I look forward to working together over the next year.
James Dubois
Chairman
27th August 2014
Operations review
The year under review can only be described as disappointing, that sentiment being reflected in the financial results for the year which showed a consolidated loss after tax of £305,049 on revenue of £3,368,500 (compared to a 2013 profit of £530,558 on revenue of £2,205,786).
During the year the Company anticipated completing the construction and sale of its flagship site at Oakhurst Park Gardens, Hildenborough, Kent comprising 12 houses and anticipating a turnover of not less than circa £6,500,000 from this site and a substantial profit.
In the event, the Company sold only four of the houses as at the year end which contributed only circa £186,000 towards the profits for the year. The reason for the failure to sell all the units and take in the profit, as anticipated on the entire site, included:-
a. Serious delays in the construction programme.
b. The liquidation of the contractor undertaking the work resulting in the Company having to employ third party contractors/sub-
c. Planning delays, reference to which was made in the Interim Trading update of the 1st April 2014.
As a result of the above, the Company incurred an increase in the cost of financing the site due to having to re-
Despite the contribution to profit made by the sale of the remaining units on the Edenbridge site (which was the basis of the small profit generated at the interim stage, as already reported on), the fact that only four of the houses at Oakhurst Park Gardens sold by the year end, resulted in the Company only being able to declare a small profit overall from its development activities.
In addition, it was necessary during the year to write-
As a result of the above, the Company has recorded a loss for the year of £ 305,049.
Our move to AIM was with a view to, inter alia, increasing the profile of the Company and utilising the Company's shares as a further source of capital funding in the future. Indeed, in the current year, your Company announced the issue of 10m new ordinary shares of 1p each at a price of 2p per share and the shares issued were admitted to trading on AIM in July 2014.
Looking forward, we are pleased to report that our sales of the houses on the Oakhurst Park Gardens site continues with five more of the units sold and a further two under offer. All homes are now fully complete and landscaping and access road works mostly concluded. The attractive nature of the development, especially the garden spaces created for each home, continues to attract positive comment from prospective purchasers. We are confident that all the remaining houses will sell in the current year, contributing to profit for the year ended 31st March 2015, despite the fact that some potential buyers have been unable to proceed due to the recent reduction in mortgage availability.
During the current year we acquired a small site with planning permission in Borough Green, near Sevenoaks, Kent which will be undertaken and should contribute to profit in the current year, along with our site at Ticehurst, East Sussex, where construction is now under way. Also during the current year we will be commencing development of the sites, with planning permission, that we own in Sheerness, Kent and Tunbridge Wells, Kent. At Tunbridge Wells, we are awaiting receipt of a planning permission for a four house scheme (to replace the six apartment scheme for which we have planning consent) as the four house scheme will generate a higher profit with less cost and risk. We are advised by our planning consultants that the granting of this alternative consent should be a formality and, therefore, we anticipate commencing construction on this site during the current year.
Our flagship site going forward will be the land at Staplehurst, Kent. Our revised planning application on the first phase for permission for a 23 house development on approximately half of the site we have under Option, is with Maidstone Borough Council. An early positive outcome is expected. Thereafter, we will be applying for consent for a further 30 houses on the remainder of the site. We have worked closely with the planners on this. The development of this site will contribute substantially to the Group's profitability for the years ended March 2016 and March 2017.
We continue to investigate other opportunities and have no shortage of sites being offered to us. We have detected, though, that land costs are rising again and we are not prepared to bid for sites which do not show a realistic return on capital employed.
Our area of operation remains Kent, East Sussex, Surrey and the outer London M25 ring and we continue to believe that our selective and careful land acquisition policy will continue to bear fruit. Indeed, our approach to land buying and development has been vindicated in the Oakhurst Park Gardens development. Despite the many unforeseen and costly problems we have encountered on this site, we still anticipate making an overall profit on the development which will show an acceptable return on capital employed. We continue to operate the business on a low overhead cost basis, despite the rising costs largely related to being on the AIM Market. We are unable to pay a dividend this year but the Company remains committed to the declaration and payment of a dividend at the earliest opportunity. The losses carried forward from previous years will continue to be available to mitigate future tax charges.
Finally, our bankers continue their financial support of the Company and its activities and with the Directors' Loans and other loans from private investors available to the Company, we have sufficient funds available to continue the expansion of the business and the generation of profitability for the Company.
Christopher Johnson
Director
27th August 2014
FOR THE 2014 ANNUAL REPORT AND AUDITED RESULTS, PLEASE CLICK HERE