Source: Business Wire
Tuesday, December 09, 2008 04:11 PM IST (10:41 AM GMT)
Editors: General: Consumer interest, Economy; Business: Banking & financial services, Business services, Construction, Financial Analyst, Real estate, Stock exchanges; Technology
Release no: 18698
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(BW)(HIRCO)(HRCO)Hirco Reports Solid Results in First Full Year; Preliminary Result for the Year Ended 30 September 2008
Net Asset Value Rises to £7.12 per Share as of 30 September 2008; Valuation of Hirco's four Development Projects Increases 34.7% to £472.7 million
London, United Kingdom, Tuesday, December 09, 2008 -- (Business Wire India) --
Hirco PLC (AIM:HRCO), the investment vehicle for Hiranandani, India's largest developer of mixed-use townships and the country's largest residential builder, today announced its audited fiscal 2008 year-end financial results for the full year ended 30 September 2008.
Fiscal 2008 Highlights
- Profit after tax was £75.1 million, representing earnings per share of 98 pence based on 76,526,984 shares outstanding.
- As of 30 September 2008, Hirco's Net Asset Value (NAV) on a per share basis had risen 98 pence to £7.12, compared with £6.14 per share at 30 September 2007. The increase in NAV is mainly driven by an increase in the value of Hirco's investment in the Chennai Residential, Chennai Commercial, Panvel Residential and Panvel Commercial projects. As of 30 September 2008, the value of Hirco's investments in these projects was £472.7 million.
- The new valuation represents a 34.7% increase from the total acquisition cost of approximately £350.8 million.
Recent Developments
- In September, Hirco announced that sales of residential units in Phase 1 of its Hiranandani Palace Gardens township developments in both Chennai and Panvel were significantly ahead of planned performance both in terms of volume of units sold and the level of pricing achieved.
- Chennai: As of 31 August 2008, sales consideration for the Chennai residential township had been accepted on approximately 1.8 million square feet of buildable area at an average price of INR 4,073 (£47.69) per square foot. The value of sales contracts in the Chennai township was £93.6 million.
- Panvel: As of 31 August 2008, sales consideration for the Panvel residential township had been accepted on approximately 1.6 million square feet of buildable area at an average price of INR 4,214 (£49.95) per square foot. The value of sales contracts in the Panvel township was £81.9 million.
Niranjan Hiranandani, Chairman of Hirco PLC, said:
"We continue to make substantial progress in the development of our Hiranandani Palace Gardens mixed-use townships in Chennai and Panvel. At both developments, we are seeing consistently strong pre-sales of residential apartments, which confirms our view that housing affordability in India is still improving and demand continues to grow.
"We are achieving this solid progress against a recent background of difficult global market conditions and slower economic growth in India. Our success, even in weaker markets, is due to our high-quality township developments, all of which are strategically located in well-connected suburbs near India's largest cities and remain highly desirable even when the economy weakens.
"The supply of quality product in the Indian market is limited, so demand for the type of high-quality product we offer continues to grow at a faster pace than our ability to release product onto the market. Today, Hirco's developments in Chennai and Panvel are benefiting by exploiting this "flight to quality" phenomenon. Even as signs of economic strain appeared in India during the second half of our fiscal year, we pre-sold 1,234,052 square feet1 of residential space, while continuing to command steadily increasing prices. We believe affordability and the level of demand will remain high in the sub-$200/per-square-foot quality residential market in which we primarily operate.
"Hirco has a strong balance sheet, no debt, access to the funds needed for further development and construction, and a strong development pipeline. As a result, we are very well positioned to execute our growth plans for the future."
The Board remains mindful that the Company's share price represents a significant discount to net asset value. The Directors strongly believe that the market capitalisation materially undervalues the Company and its prospects; they keep this situation under constant review and are actively considering options to address the imbalance.
This preliminary announcement was approved by the board on 8 December 2008.
About Hirco
Hirco PLC is the investment vehicle for Hiranandani, India's largest developer of prestigious mixed-use townships for the country's increasingly affluent middle class. Our modern, large-scale developments - combining high-quality residential, commercial and retail components with green space and social and recreational facilities - are strategically located in suburban areas outside major city centres. Hirco's four current projects - in Chennai in southeast India and Panvel, in the Mumbai Metropolitan Region - feature a combined total of 66.4 million square feet of buildable mixed-use space.
Hirco PLC shares are traded on the London Stock Exchange's Alternative Investment Market (AIM) under the symbol HRCO. At the time of its admission to trading on AIM in December 2006, Hirco PLC was the largest-ever real estate investment company IPO on the AIM and that year's largest IPO on the AIM.
For further information about the Company, please visit www.hircoplc.com.
1 For the five-month period 1 April to 31 August 2008
| Hirco Plc | ||||||
| Consolidated Income Statement | ||||||
| for the year ended 30 September 2008 | Amount in £000's | |||||
| CONTINUING OPERATIONS | Notes | 01 Oct 2007 to 30 Sep 2008 | 02 Nov 2006 to 30 Sep 2007 | |||
| Investment income | 5 | 44,200 | 22,269 | |||
| Foreign exchange gain / (loss) | 1 | (14 | ) | |||
| Net investment income | 44,201 | 22,255 | ||||
| Fair value gain on investments | 12 | 34,660 | 87,220 | |||
| Administrative expenses | 6 | 3,790 | 2,345 | |||
| Net income before finance costs | 75,071 | 107,130 | ||||
| Finance costs | - | - | ||||
| Profit before taxes | 75,071 | 107,130 | ||||
| Income tax expense | 7 | 12 | 19 | |||
| Profit for the year / period | 75,059 | 107,111 | ||||
| Earnings per share (consolidated): | ||||||
| Basic, for the period attributable to ordinary equity holders (Pence) | 9 | 98 | 140 | |||
| Diluted, for the period attributable to ordinary equity holders (Pence) | 9 | 98 | 140 | |||
| The Directors consider that all results derive from continuing activities. | ||||||
| The notes on pages 5 to 21 forms part of these financial statements. | ||||||
| Hirco Plc | |||||||||
| Balance Sheets | |||||||||
| as at 30 September 2008 | Amount in £000's | ||||||||
| ASSETS | Notes | Group | Company | ||||||
| 2008 | 2007 | 2008 | 2007 | ||||||
| NON-CURRENT ASSETS | |||||||||
| Property, plant and equipment | 11 | 33 | 42 | - | - | ||||
| Investments | 12 | 472,690 | 341,392 | - | - | ||||
| Due from subsidiaries | 18 | - | - | 353,866 | 256,110 | ||||
| Accrued income | 13 | 45,958 | - | 44,785 | - | ||||
| 518,681 | 341,434 | 398,651 | 256,110 | ||||||
| CURRENT ASSETS | |||||||||
| Accrued income | 13 | 9,000 | 12,086 | 9,000 | 12,219 | ||||
| Other debtors and prepaid expenses | 2,031 | 158 | 1,990 | 149 | |||||
| Other current assets | 95 | 47 | 73 | 38 | |||||
| Cash and cash equivalents | 15 | 17,060 | 116,423 | 16,579 | 115,584 | ||||
| 28,186 | 128,714 | 27,642 | 127,990 | ||||||
| Total assets | 546,867 | 470,148 | 426,293 | 384,100 | |||||
| LIABILITIES | |||||||||
| CURRENT LIABILITIES | |||||||||
| Trade and other payables | 883 | 69 | 837 | 8 | |||||
| Accrued expenses | 1,169 | 332 | 1,063 | 257 | |||||
| Total liabilities | 2,052 | 401 | 1,900 | 265 | |||||
| Net assets | 544,815 | 469,747 | 424,393 | 383,835 | |||||
| EQUITY | |||||||||
| Share capital | 17 | 765 | 765 | 765 | 765 | ||||
| Share premium | 361,871 | 361,871 | 361,871 | 361,871 | |||||
| Foreign currency translation reserve | 9 | - | - | ||||||
| Retained earnings | 182,170 | 107,111 | 61,757 | 21,199 | |||||
| Total equity | 544,815 | 469,747 | 424,393 | 383,835 | |||||
| Number of ordinary shares | 10 | 76,526,984 | 76,526,984 | 76,526,984 | 76,526,984 | ||||
| Net Assets Value per share (Pence) | 10 | 712 | 614 | 555 | 502 | ||||
| The notes on pages 5 to 21 forms part of these financial statements. | |||||||||
| Hirco Plc | |||||||||||
| Consolidated Statement of Changes in Equity | |||||||||||
| for the year ended 30 September 2008 | Amount in £000's | ||||||||||
| GROUP | Share capital | Share premium | Currency translation reserve | Retained earnings | Total | ||||||
| Issue of share capital | 765 | 381,869 | - | - | 382,634 | ||||||
| Profit for the period | - | - | - | 107,111 | 107,111 | ||||||
| Share issue costs | - | (19,998 | ) | - | - | (19,998 | ) | ||||
| As at 30 September 2007 | 765 | 361,871 | 107,111 | 469,747 | |||||||
| Translation of foreign operations | - | - | 9 | - | 9 | ||||||
| Profit for the year | - | - | - | 75,059 | 75,059 | ||||||
| As at 30 September 2008 | 765 | 361,871 | 9 | 182,170 | 544,815 | ||||||
| The notes on pages 5 to 21 forms part of these financial statements. | |||||||||||
| Hirco Plc | ||||||
| Consolidated Cash Flow Statement | ||||||
| for the year ended 30 September 2008 | Amount in £000's | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES | 2008 | 2007 | ||||
| Profit before taxation : | 75,071 | 107,130 | ||||
| Adjustment for: | ||||||
| Fair value gains on investments | (34,660 | ) | (87,220 | ) | ||
| Depreciation | 37 | 13 | ||||
| Foreign exchange gain | (1 | ) | - | |||
| Operating profit before working capital changes | 40,447 | 19,923 | ||||
| Change in debtors and prepayments | (43,001 | ) | (12,291 | ) | ||
| Change in creditors and other accruals | (43 | ) | 347 | |||
| Tax paid | (12 | ) | - | |||
| Net cash (used in) / generated from operating activities | (2,609 | ) | 7,979 | |||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||
| Purchase of fixed assets | (28 | ) | (20 | ) | ||
| Purchase of investments | (96,638 | ) | (254,172 | ) | ||
| Project costs paid | (98 | ) | - | |||
| Net cash used in investing activities | (96,764 | ) | (254,192 | ) | ||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||
| Proceeds from issue of share capital (net of issue costs) | - | 362,636 | ||||
| Net cash generated from financing activities | - | 362,636 | ||||
| (Decrease) / Increase in cash during the year / period | (99,373 | ) | 116,423 | |||
| Effect of exchange rate fluctuations on cash balances | 10 | - | ||||
| Cash and cash equivalents at the beginning of the period | 116,423 | - | ||||
| Cash and cash equivalents at the end of the period | 17,060 | 116,423 | ||||
| The notes on pages 5 to 21 forms part of these financial statements. | ||||||
CONTACT DETAILS
Hirco
Jasper Reiser
+91 22 6671 8522
jreiser@hirco.com
OR
Gutenberg CommunicationsUS
Hugh Burnham
+1 212-239-8595
hugh@gutenbergpr.com
Michael Gallo
+1 212-239-8594
mgallo@gutenbergpr.com
OR
UK
Shalini Siromani
+44 (0) 20 3008 5231
shalini@gutenbergpr.com
OR
India
Pranav Kumar
+91 98 1007 7898
pranav@gutenbergpr.com
KEYWORDS
CONSUMER, ECONOMY, BANKING, BUSINESS SERVICES, CONSTRUCTION, Financial Analyst, REAL ESTATE, STOCK EXCHANGES, TECHNOLOGY
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