Eatonfield profits fall
COMMERCIAL property company Eatonfield Group has made a pre-tax profit of £4.03m, down 12% on the previous year.
The profit was largely due to revaluation gains on two investment properties and not as a result of trading.
The company’s full-year results to the end of June 2008 show a turnover £10.06m compared with £18.6m in 2007.
Rob Lloyd, chief executive of the Mold, Flintshire-based company, said that although 2008 had been difficult, the company had acted decisively to take account of unfavourable conditions.
“We have worked closely with our two main lenders who continue to support us and we remain focussed on cash generation and debt reduction. We have cut costs in the last 12 months which has included making redundancies, however, we have retained our core skill base enabling us to progress swiftly as the market improves,” he said.
Eatonfield did see assets increase to £54.6m (£47.7m in 2007) despite a stock write down of £5m. Liabalities stood at £37.9m.
The company said it had made sales of a further £3.5m since the end of June, and that further completions of £1.1m are expected by December 2008.
Its residential land bank includes 530 plots with planning consent and an additional 1,287 potential plots.
In the last few months Eatonfield has been restructured with the closure of three local offices, the relocation of the head office to smaller premises, and a 25% reduction of overhead costs.
The company has just three sites under construction after it made the decision to start no new residential developments in the year. These are due for completion in the last quarter of 2008.
It said that it expected no improvement in the residential market before 2010/11 and that further falls in value are likely in the commercial market before any recovery.
Eatonfield took a £750,000 loan from chief executive Rob Lloyd towards the end of October. It said the cash injection will take the group to the point where sufficient funds will be available from refinancing or property sales to generate positive trading cash flows.
However, there is doubt over its ability to continue as a going concern should any overdraft facility not be renewed or other loan facility becomes payable prior to the sale of the related asset.
If this happened it would have to dispose of assets to meet its debts but market conditions mean the process would take longer and that the assets would not achieve their book value.
The company also announced that Howard Jones has resigned as group finance director and that chairman Sir Leslie Young, chairman is to retire in the near future.
It is not paying a dividend this year.
Mr Lloyd founded AIM-listed Eatonfield in 1998 after running Manchester-based developer UK Land.
