metro junction

Latest Results

Preliminary results

West Pioneer, a leading developer and operator of shopping malls and mixed use developments in west and southern India, announces its preliminary results for the year ended 31 March 2010.

 

Highlights
Chairman's Statement
Consolidated Income Statement
Consolidated Statement of other Comprehensive Income
Consolidated Statement of Financial Position
Statement of Changes in Equity
Consolidated Cash Flow Statement
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Highlights

Commenting on the results, Amit Jatia, Chairman of West Pioneer, said: "West Pioneer's key objective is to continue to be a leading developer and operator of retail-led mixed use developments in west and southern India, to continue developing a brand representing quality and attractive pricing and to generate attractive returns for shareholders from sales of units, growth in income and asset value. I remain confident that continued progress will be made in these areas in the current financial year."

 

Chairman's Statement

In the year ended 31 March 2010, West Pioneer achieved revenue and other income of US$7.9m (2009: US$12.3m), including property rentals and other operating income of US$3.2m (2009: US$2.6m). Profit before tax was US$3m (2009: US$6.4m) and basic earnings per share was US$0.016 (2009: US$0.03). Net assets at the year end were US$63.3m (2009: US$53.9m), including cash and short term deposits of US$3.9m (2009: US$6.6m). Interest bearing loans and borrowings reduced from US$8.1m to US$7.6m during the period, inclusive of debt repayments.

Kalyan

The Metro Junction mall in Kalyan continues to experience strong growth in footfalls with more than 6m visitors to the mall during the year. During the second half of the year the numbers have more than doubled from the comparable period in 2009 rising from 1.8m to 4m for the six month period. Particularly encouraging is the increasing number of people visiting by car which typically reflects the relative affluence of the customer as well as their intention to purchase.

The economic climate for retailers has also improved over the last six months. Confidence appears to have returned to the sector with retailers once again looking to open new stores.

Leasing remains consistent with last reported levels of 65 per cent. The Company has had opportunities to lease additional vacant units during the period, but not on terms that it considered commercially acceptable or with suitable tenants. Given that the mall is now trading profitably, partly as a result of active mall management, the Company has decided to prioritise maximising rental values and the quality of tenants and tenant mix rather than short-term occupancy. The Company has also been seeking to maximise other revenue streams for the mall including income from car-parking, advertising and kiosks.

The residential development at Kalyan has progressed well during the period, with two towers on the 500,000 square foot development now under construction. Each tower comprises 178 apartments and to date a total of 231 apartments have been sold, with the most recent sale prices attracting 3,600 rupees per square foot, a 38 per cent. increase from launch price. The Company will be able to complete the residential development without the need for external finance.

In addition, following extensive market research the Company has decided to convert 68,000 square feet of the remaining land at Kalyan into commercial office space which will be sold as opposed to being leased. The Company has finalised plans for this space known as Metro Plaza and will commence pre sales in September 2010. This is in line with management's strategy to take advantage of opportunities where premium value can be generated. Current indications are that the price per square foot of the commercial space for sale will be significantly higher than that of the residential space.

The residential and commercial developments have marked a change in emphasis for the Company that involves marketing and selling directly to the consumer as opposed to indirectly through retailers in the mall. West Pioneer with its McDonalds background and real estate execution capability in India is well placed to pursue such opportunities. It will also seek to develop other opportunities to provide real estate products and services directly to the Indian consumer. The project also shows the benefits and synergies of mixed use developments and the Company will look to follow this model in other developments.

Nashik and Aurangabad the Group expects to advance its plans for the Nashik site during the current financial year. The development plans comprise a mall, commercial space and a hotel. Pre-leasing discussions are taking place with prospective anchor tenants for the mall and corporates for commercial space.

Development of Aurangabad will follow development of the Nashik site. The plans also include retail space, commercial units and a hotel. A management agreement with InterContinental Hotels Group remains in place for the development of a Holiday Inn hotel at both sites.

Board and Management

On 3 March 2010, West Pioneer announced the appointment of Ajay Gupta as Chief Executive Officer of the Company. Mr Gupta has been associated with West Pioneer since early 2009 as a valued member of the management committee involved in leading the Company's strategic planning process. He also has extensive experience within the retail sector having been associated with Hardcastle Restaurants, the McDonald's India joint venture in the west and south of the country, as well as with Global Trendz Ltd, the Master franchise for Disney Kids Wear in India. In his most recent role as Chief Executive Officer of Astrum Consulting, a management and strategic consultancy business which he co-founded in April 2000, Mr Gupta helped increase the client base to include some of the world's leading blue chip businesses, including HSBC, Vodafone, Astra Zeneca and Unilever.

Outlook

Trading conditions in the last financial year have continued to be challenging. However, the organised retail sector is expected to grow from 6% of total retail to 11% by 2013 (Source: Knight Frank).

West Pioneer's key objectives are to continue to be a leading developer and operator of retail-led mixed use developments in west and southern India; to continue developing a brand representing quality and attractive pricing; to generate attractive returns for shareholders from sales of units, growth in income and asset value. I remain confident that continued progress will be made in these areas in the current financial year.

 

 

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CONSOLIDATED INCOME STATEMENT
for the year ended 31st March 2010

  Year ended 31st March
  2010 2009
  $ $
Revenue    
Property Rentals 1,612,256 1,314,714
Other operating income 1,656,311 1,277,845
  3,268,567 2,592,559
Property Revaluation 3,897,005 8,872,574
Finance and other income 831,174 820,351
Total revenue 7,996,746 12,285,484
     
Expenses    
Direct operating expenses for  rent-earning properties (1,671,845) (1,346,453)
Administrative expenses (1,812,504) (2,356,818)
Selling and distribution costs (364,523) (163,475)
Finance costs (1,109,192) (2,043,127)
Total expenses (4,958,065) (5,909,873)
     
Profit before tax 3,038,680 6,375,611
Income tax expense (1,767,376) (3,686,386)
     
Profit after tax 1,271,304 2,689,225
     
Attributable to:    
Equity holders 1,271,304 2,689,225
     
Earnings per share (attributable to equity holders)    
Basic 0.016 0.033
Diluted 0.016 0.033

 

 

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CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
AS AT 31st March 2010

  Year ended 31st  March
  2010 2009
  $ $
     
Profit for the period 1,271,304 2,689,225
     
Exchange gain/ (loss) on translation of foreign operations 7,992,191 (15,795,967)
     
Other comprehensive income/ (loss) for the period, net of tax 7,992,191 (15,795,967)
     
Total comprehensive income for the period, net of tax  9,263,495 (13,106,742)
Attributable to:    
Equity holders 9,263,495 (13,106,742)

 

 

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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
for the year ended 31st March 2010

  As at 31st  March
  2010 2009
  $ $
ASSETS    
Non current assets    
Property, plant and equipment 371,496 2,008,412
Investment Properties 73,059,060 39,670,517
Intangible assets 21,984 24,872
Prepayments 3,276,953 23,605,311
Other financial assets 306,572 214,337
  77,036,065 65,523,449
Current assets    
Inventories 5,382,043 6,012
Investments – Held for trading 639,615 1,126,832
Trade and Other receivables 1,450,130 768,528
Prepayments 70,450 26,674
Advance tax 355,305 218,064
Cash and short-term deposits 3,966,039 6,645,093
  11,863,581 8,791,203
TOTAL ASSETS 88,899,646 74,314,652
EQUITY AND LIABILITIES    
Equity attributable to the equity holders    
Issued capital 7,996,130 7,996,130
Share premium 45,717,870 45,717,870
Retained earnings 13,192,220 11,920,917
Employee Equity Benefits Reserve 650,152 515,474
Foreign currency translation reserve (4,232,702) (12,224,893)
  63,323,671 53,925,497
Non current liabilities    
Interest bearing loans and borrowings 5,662,879 6,516,618
Other financial liabilities 3,352,652 663,681
Other non financial liabilities 88,755 55,582
Employee benefit liability 48,113 34,452
Deferred Tax Liability 10,199,789 7,196,150
  19,352,188 14,466,483
Current liabilities    
Trade and other payables 3,421,657 3,591,567
Interest bearing loans and borrowings 1,931,473 1,629,155
Other financial liabilities 828,629 651,610
Other non financial liabilities 42,029 50,340
  6,223,788 5,922,672
TOTAL LIABILITIES 25,575,975 20,389,155
TOTAL EQUITY & LIABILITIES 88,899,646 74,314,652

 

 

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CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31st March 2010

  Attributable to equity holders of the parent
  Issued Share Retained Employee equity benefits Foreign currency translation Total
  capital premium earnings reserve reserve equity
  $ $ $ $ $ $
Balance as at 1st April 2009 7,996,130 45,717,870 11,920,916 515,474 (12,224,893) 53,925,497
Profit for the period - - 1,271,304 -   1,271,304
Other comprehensive income   -     7,992,191 7,992,191
Total comprehensive income - - 1,271,304 - 7,992,191 9,263,495
Share based payment - - - 134,678 - 134,678
Balance as at 31st March 2010 7,996,130 45,717,870 13,192,219 650,152 (4,232,702) 63,323,670
             
Balance as at 1st April 2008 7,996,130 45,717,870 9,199,598 - 3,571,074 66,484,672
Profit for the period - - 2,689,225 - - 2,689,225
Other comprehensive income - - - - (15,795,967) (15,795,967)
Total comprehensive income - - 2,689,225 - (15,795,967) (13,106,742)
Share based payment - - - 547,567 - 547,567
Transfer to retained earnings on options forfeited - - 32,093 (32,093) - -
Balance as at 31st March 2009 (Audited) 7,996,130 45,717,870 11,920,916 515,474 (12,224,893) 53,925,497
             

 

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CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31st March 2010

  Year ended 31st  March
  2010 2009
  $ $
Operating activities    
Profit before tax 3,038,680 6,375,610
Adjustments to reconcile profit before tax to net cash flows    
Depreciation and amortisation 34,501 26,876
Share based payments expense 134,678 547,567
(Increase) in fair value of investment properties (3,897,005) (8,872,574)
(Increase)/decrease in value of investments held-for-sale (171,994) 107,934
Net (Gain) / loss on sale of investment (113) 30,108
Dividend Income (18,121) (228,813)
Interest Income (142,679) (529,659)
Interest expense 1,101,125 935,870
(Increase) in other assets (non-current) (54,919) (36,256)
(Increase) in prepayments (current) (39,829) (15,833)
(Increase) in trade and other receivables (555,231) (668,384)
(Increase) in Inventories-Residential (728,977) -
(Increase) in Inventories - Mall (68,186) -
(Decrease) in trade and other payables (423,660) (1,838,132)
Increase  in Statutory dues 123,656 -
(Decrease) in other payables (108,481) -
Increase in other liabilities current 15,475 617,615
Increase in other liabilities non current 2,467,476 464,215
Income tax paid (14,922) (205,721)
Netcash flows from /(used) in operating activities 691,475 (3,289,577)
     
Investing activities    
Proceeds from sale of held-for-trading investments 850,384 11,349,958
Purchase of property, plant and equipment and intangible assets (13,189) (36,645)
Purchase of held-for-trading investments (96,346) (1,944,851)
(Increase) in prepayments (510,438) (3,516,974)
(Increase) in Investment Property (288,426) -
Investment in construction costs (928,476) (5,545,800)
Dividend income 94,591 228,813
Interest received 69,111 529,659
Net cash flows (used in )/from investing activities (822,789) 1,064,160
     
Financing activities    
Proceeds from borrowings - 651,754
Repayment of borrowings (1,738,948) (1,777,930)
Interest paid (1,101,125) (935,870)
Net cash flows (used in) financing activities (2,840,073) (2,062,046)
Net (decrease) in cash and cash equivalents (2,971,387) (4,287,463)
Net foreign exchange difference 101,457 (2,018,494)
Cash and cash equivalents at 1st April 2009 5,443,352 11,749,309
Cash and cash equivalents at 31st March, 2010 2,573,422 5,443,352

 

 

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Page last up-dated: 21 July 2010