RESULTS FOR ANNOUNCEMENT TO THE MARKET
Reporting period Year to 30 June 2010
Previous reporting period Year to 30 June 2009
Amount ($’000) Percent change
Revenue from ordinary activities 434,395 -10.9%
Trading profit from ordinary activities after tax 6,130 -12.5%
Net profit attributable to shareholders (1,241) -126.9%
Amount per share Imputed amount per share
Final divided 9.00 cents 3.86 cents
Record date 15 October 2010
Payment date 26 October 2010
Trading Profit after Tax for the year was $6.130m, compared to $7.002m for the last financial year to 30 June 2009 and $2.594m for the six month period to 31 December 2009.
As you will understand from the comments below, the reported “Profit after Tax” (or actually a loss as reported this year) is currently not a relevant measure of profitability. Over the years we have reported the “Trading Profit after Tax” figure as being the ongoing operational profit that excludes non-cash “value adjustments”.
In overall terms our trading result saw sales down 11% on the previous year, and slightly below our expected level. Trading Profit after Tax, while down 12% was in line with our expectations. However trading in the last 4-5 months has been tougher than we anticipated.
This year the accounts reflect even more changes to comply with International Financial Reporting Standards (IFRS).
As a company owning property we have been impacted by the outcome of the 2010 Budget. The actual tax cost to the Group of the non-deductibility of building depreciation from 2011 is less than $0.2m per annum. However an unintended consequence of the budget announcement and accounting rules is that we have been required to book a deferred tax non cash expense of $6.383m against this year’s profit at the new tax rate of 28% on the carrying value of depreciable buildings. This represents the theoretical cost of the tax change effect over the entire lifetime of the buildings.
Over and above this, the way we account for “realised gains on sale of property” i.e. surplus over depreciated cost, has moved from the Income Statement to below the line in the Statement of Comprehensive Income, which was previously part of the Statement of Movements in Equity.
Our property is revalued annually at balance date at “fair value” and this year resulted in an overall reduction in value of $3.378m or 3.8%. The effect of this is split between profit, $0.823m and property revaluation reserve in Comprehensive Income, $2.555m.
The full year’s result has a significant level of non-trading, non-cash negative adjustments but the underlying trading profit was satisfactory given the big picture economic circumstances.
The Directors have resolved that a fully imputed final dividend of 9.0 cents per share will be paid on Tuesday 26 October. This takes the full year dividend to 15.0 cents per share compared to the equivalent of 12.8 cents per share in 2009. This will mean total dividends paid to shareholders for the year of $4.904m compared to $4.178m last year.
The Company’s Annual Report is expected to be mailed by the end of September and the 92nd Annual Meeting will be held at 11:00am on Friday, 5 November 2010 at the Company’s offices.
