Malta Properties Company plc - Full-Year Results
On 21 March 2018, Malta Properties Company plc published the preliminary results for the financial year ended 31 December 2017.
Performance Overview
During the period under review, revenues dropped by 4.2% to just under €3.1 million reflecting the release of various properties previously occupied by GO plc for the purpose of redevelopment. On the other hand, administrative expenses rose considerably to €1.31 million (FY2016: €0.71 million), reflecting increased activity in terms of property acquisition as well as planned redevelopment projects. As a result, operating profits slumped by 29.2% to €1.79 million.
Net finance costs decreased by 18.2% to €0.64 million (FY2016: €0.78 million). Moreover, the company posted a much larger positive adjustment in the fair value of property of €4.97 million in 2017 compared to €1.7 million in the previous comparable period. Accordingly, pre-tax profits surged to €6.13 million. After accounting for a tax charge of €1.45 million, the net profit figure for the year amounted to a record of €4.67 million. This translates into an earnings per share of €0.0461 (FY2016: €0.0252).
The Statement of Financial Position shows a 15% increase in total assets to €67.5 million (31 December 2016: €58.7 million), largely reflecting development and improvements being carried out by the company on a number of its properties, as well as the effect of the positive adjustment in the fair value of properties. Similarly, total liabilities grew by 17.2% to €36.5 million, mainly reflecting higher trade payables (+€1.92 million), borrowings (+€1.02 million), and deferred tax liabilities (+€0.94 million). Overall, shareholders’ funds increased by 13.6% to nearly €41 million. This translates into a net asset value per share of €0.4046 (31 December 2016: €0.3562).
In their commentary, the Directors explained that during 2017, MPC commenced works on the development of two new small exchanges. In this respect, the exchange situated in Marsa was completed before the end of 2017 whilst works on the new exchange in Birkirkara are currently under way. Meanwhile, works related to the conversion of the Zejtun exchange into a state-of-the-art technical and data centre for GO plc are progressing. In addition, the property situated in Floriana has been redeveloped into The Bastions office complex. The latter welcomed its first tenant early in 2018.
Dividend
Similar to previous years, the Directors are not recommending the payment of a dividend.