Newmarket Property Trust Surplus
FOR IMMEDIATE RELEASE
17 September 2002
Newmarket Property Trust Surplus
Newmarket Property Trust has reported a net surplus before realisations and revaluations for the year ended 30 June 2002 of $4.07m compared with $4.44m the previous year.
Gross revenue was marginally down on the previous year at $8.82m. Direct costs increased by $297,000 including restructuring costs of $462,000 related to the takeover offer from The National Property Trust (National), and the aborted offer from the Symphony Group.
Investment Property negative revaluations of $6.64m resulted in a net deficit after taxation of $3.47m. The reduction in the valuation of the Rialto on Broadway, Carlton DFK Centre and the AA Centre were partly offset by an upward revaluation of $190,000 on the George Court sign and a gain on the sale of the Rialto Carpark of $772,000. This carpark property was sold for $7.25m in June 2002.
Total assets are now $69.97m (2001: $82.44m). Net assets total $38.93m ($47.56m) and represent a net asset backing of 57.5 cents per unit (2001:70.3cpu). Term Borrowings have reduced from $33.85m to $29.4m.
The Trust is seeking refunds from Inland Revenue for overpaid tax for the 1994 to 1999 financial periods totalling $1.20m. Although the directors remain confident in the strong technical arguments of the claims and view them as valid receivables the refunds, which were previously treated as current assets, have been reclassified to Contingent Assets in accordance with Financial Reporting Standard No. 15 “Provisions, Contingent Liabilities and Contingent Assets” which became effective during the year. This has adversely impacted on the taxation provision for the 2002 financial year.
Gross dividend distributions provided or paid during the financial year totalled 7.65cents per unit. (6.57cpu). This included a special divided of 1.5 cents per unit including imputation credits of 0.33 cents per unit, which was provided for in the financial statements and paid out to unitholders in August 2002.
The directors have determined that there will be no final dividend distribution for the 2002 financial year.
Paid / Due Dividend Distribution Imputation Credits
Attached Gross Dividend
2001 Final September 2001 2.49 0.53 3.02
2002 Interim March 2002 2.82 0.31 3.13
Special August 2002 1.17 0.33 1.50
Total for Year 6.48 1.17 7.65
In May 2002, National announced its intention to make a takeover offer for all of the units on issue in Newmarket and offered 6 National units for every 10 Newmarket units. The offer was declared unconditional on 30 July 2002 when National’s unit holders approved the takeover offer and the minimum acceptance level of 50% was achieved. The offer has been extended to 3 October 2002. As at 13 September 2002, National had received acceptances from 1528 unitholders representing 86.65% of the units on issue. The total number of Unit Holders in Newmarket has reduced below 120.
If 100% ownership is not achieved it is the intention of the Manager to operate the Trust as a separate entity although the Trust will be duplicating some administration systems and not enjoying all of the efficiencies that would arise from an enlarged Trust. The Board of the Manager is investigating whether it is appropriate for Newmarket to remain a listed entity.
For accounting purposes, National has advised that it will consolidate the Newmarket Statements of Financial Performance and Position into its Financial Reports.
Interests associated with The National Property Trust Limited, which manages National, have purchased Newmarket Property Management Limited and assumed management control of Newmarket from 1 September 2002.
Barrie Downey, Peter Rae and Paul Dallimore have been appointed to the board of directors of Newmarket Property Management Limited. Richard Coon, who is presently on the Board, has agreed to remain a director, which will provide continuity of governance. Jock Irvine, Neville Darrow and David Keys have resigned from the Board.
The directors are presently reviewing the strategic options for each of the properties owned by the Trust.