Haslemere interim report September 2004

Haslemere NV reports a net profit of GBP 17.8 million (EUR 25.9 million) for the first nine months of the financial year ending 31 December 2004, compared with a net loss of GBP 17.3 million (EUR 25.2 million) for the corresponding period of 2003.

Accounting Principles
Assets and liabilities as at 30 September 2004 are valued and presented under Dutch GAAP, adopting the same accounting principles as used in the accounts for the year ended 31 December 2003, applied on a consistent basis. The accounting principles and presentation of net profit have changed in comparison to the 2003 annual accounts and are in conformity with the revised Dutch Reporting Guideline (Richtlijn 615). As previously reported on 20 April 2004, Haslemere NV has adopted, for the first time, the revised Richtlijn 615 for the 2004 financial year.

The impact on Haslemere of implementing the revised guideline is to combine the Revaluation Reserve with the General Reserve and to define and present as Net Profit that which was previously defined and presented as Total Performance. The net financial impact on Net Profit for the nine months of 2004 is an increase of GBP 12.8 million (EUR 18.6 million). The impact on Net Profit for the first nine months of 2003 is a decrease of GBP 13.6 million (EUR 19.8 million).

The Interim Report has not been audited.

Operating Performance
Haslemere NV reports a net profit of GBP 17.8 million (EUR 25.9 million) for the first nine months of the year ending 31 December 2004, compared with a net loss of GBP 17.3 million (EUR 25.2 million) for the first nine months of 2003.

Portfolio Activity
During the nine months to 30 September 2004 gross proceeds from the sale of property were GBP 85.7 million (EUR 124.8 million) generating a gain on disposal of GBP 3.6 million (EUR 5.2 million). The total revaluation surplus for the year to date, including the unrealised surplus arising from the external revaluation of the property portfolio at 30 June 2004, is GBP 14.5 million (EUR 21.1 million).

The total revaluation deficit of the property portfolio during the corresponding 9 month period in 2003 amounted to GBP 11.4 million (EUR 16.6 million). Since the end of the quarter the Company has contracted for the sale of the Kingsway Estate for GBP 52.5 million (EUR 76.4 million). This sale is scheduled to complete early January 2005.

Shareholders’ Equity
Shareholders’ equity has decreased from GBP 233.6 million (EUR 340.1 million) at 31 December 2003 to GBP 204.4 million (EUR 297.6 million) at 30 September 2004. The movement results from net profit during the quarter of GBP 1.7 million (EUR 2.5 million) and a first half year net profit of GBP 16.1 million (EUR 23.4 million), less a distribution from the share premium reserve of EUR 69.8 million (GBP 46.9 million ).

Debt Financing
Total borrowings at 30 September 2004 were GBP 179.4 million (EUR 261.2 million). There has been no change during the quarter.

The adjustment required to increase the value of fixed interest debt to its fair value, is estimated at GBP 35.3 million (EUR 51.4 million) gross, and GBP 24.7 million (EUR 36.0 million) net of tax relief, at 30 September 2004. The corresponding figures at the end of December 2003 were GBP 36.4 million (EUR 53.0 million) and GBP 25.4 million (EUR 37.0 million) respectively.

Statutory squeeze-out procedures
As previously announced on 28 October 2004, the Company has been informed by its majority shareholder, General Electric Capital Corporation (“GECC”), that the Enterprise Section of the Amsterdam Court of Appeal has given judgement in the squeeze out proceedings between GECC and the minority shareholders of Haslemere NV, ordering the minority shareholders to transfer their ordinary shares in the capital of Haslemere NV to GECC pursuant to Section 2:92a of the Dutch Civil Code.

The effect of this judgement is that GECC will hold 100% of the ordinary shares in Haslemere NV. Further details are set out in the Company’s press release of 28 October 2004.

The Company has reques

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