12 INVESTMENTS
| 2007 £’000 |
2006 £’000 |
|
| Investments in associates | 842 | 673 |
| Investments in joint ventures | 8,379 | 20,464 |
| Investments accounted for using the equity method | 9,221 | 21,137 |
a) Investment in associates
The Group holds a 29 per cent interest in Continental Estates Corporation BV, a company incorporated and registered in The Netherlands, whose principal activity is the holding of investments. The equity investment of £256,000 has been provided against in full in previous years.
Wessex Property Fund is a trust that was established on 5th April 2006. Its principal activity is to invest in property situated in the South West of England. As at 31st December 2007 the Group held 47 per cent of the units in issue.
The Group holds 50 per cent of the Ordinary shares and 10 per cent of the Preference shares of Peacock Place Limited, a company incorporated and registered in Jersey, whose principal activity is property investment. The rights granted under the shareholder agreement for this company reflect the status of this investment as an associate.
The Group holds 25 per cent of the Ordinary shares of CTP Securities Limited, a company incorporated and registered in the United Kingdom, whose principal activity is property development. The rights granted under the shareholder agreement for this company reflect the status of this investment as an associate.
The Group’s share of assets and liabilities in its associates is set out below:
| 2007 | 2006 | |||||||
| Wessex Property Fund £’000 |
CTP Securities Limited £’000 |
Peacock Place Limited £’000 |
Continental Estates Corp. BV £’000 |
Total £’000 |
Peacock Place Limited £’000 |
Continental Estates Corp. BV £’000 |
Total £’000 |
|
| Summarised balance sheets: | ||||||||
| Non-current assets | 10,170 | 667 | 7,585 | 367 | 18,789 | 11,665 | 413 | 12,078 |
| Current assets | 531 | 10,280 | 431 | 61 | 11,303 | 876 | 31 | 907 |
| Share of gross assets | 10,701 | 10,947 | 8,016 | 428 | 30,092 | 12,541 | 444 | 12,985 |
| Current liabilities | (323) | (7,287) | (988) | (142) | (8,740) | (750) | (95) | (845) |
| Non-current liabilities | (9,675) | (3,521) | (11,144) | (902) | (25,242) | (11,118) | (902) | (12,020) |
| Share of gross liabilities | (9,998) | (10,808) | (12,132) | (1,044) | (33,982) | (11,868) | (997) | (12,865) |
| Share of net assets/(liabilities) | 703 | 139 | (4,116) | (616) | (3,890) | 673 | (553) | 120 |
| Share of losses not recognised | – | – | 4,116 | 616 | 4,732 | – | 553 | 553 |
| Group’s share of net assets | 703 | 139 | – | – | 842 | 673 | – | 673 |
| Summarised income statements: | ||||||||
| Share of revenue | 280 | 56 | 697 | – | 1,033 | 682 | 1 | 683 |
| Share of post tax losses of associates | (127) | (26) | (3,780) | (62) | (3,995) | (292) | (68) | (360) |
| Share of losses not recognised | – | – | 3,107 | 62 | 3,169 | 292 | 68 | 360 |
| Share of losses recognised | (127) | (26) | (673) | – | (826) | – | – | – |
b) Investment in joint ventures
The Group has the following interests in joint ventures:
| % of share capital |
Country of incorporation |
Principal activity | Joint venture partner | ||
| Wimbledon Phoenix Limited | 50 | United Kingdom | Property development | Foinavon Limited | |
| Curzon Park Limited | 50 | United Kingdom | Property development | Grainger PLC | |
| Hammersmith Central Unit Trust | 10 | Jersey | Property development | The National Bank of Dubai | |
| Hammersmith Central General Partner Limited | 10 | United Kingdom | Property development | The Royal London Mutual | |
| Insurance Society Limited |
The Group currently holds 39 per cent of the units in Hammersmith Central Unit Trust Limited. 10 per cent of the units, £231,000, are held as a long-term joint venture interest, with the remaining 29 per cent, £654,000, as an investment in joint venture – held for sale. It is the Group’s intention to sell the 29 per cent holding to a future investor in the Hammersmith Grove development.
The Group’s share of the assets, liabilities, income and expenses of its joint ventures, which include amounts receivable from those joint ventures, is as follows:
| 2007 | ||||
| Hammersmith Central Unit Trust £’000 |
Curzon Park Limited £’000 |
Wimbledon Phoenix Limited £’000 |
Total £’000 |
|
| Summarised income statements: | ||||
| Net revenue | – | 26 | – | 26 |
| Administrative expenses | – | – | (5) | (5) |
| Finance income | – | 36 | – | 36 |
| Profit/(loss) before and after taxation | – | 62 | (5) | 57 |
| Summarised balance sheets: | ||||
| Non-current assets | 231 | 19,209 | 325 | 19,765 |
| Current assets | – | 210 | 7 | 217 |
| Current liabilities | – | (206) | (11) | (217) |
| Non-current liabilities | – | (11,386) | – | (11,386) |
| Share of net assets | 231 | 7,827 | 321 | 8,379 |
During the year, the Group acquired an additional 12.5 per cent stake in Luneside East Limited, taking the Group’s holding to 62.5 per cent. Luneside East Limited is now classified as a subsidiary and its results have been consolidated on that basis.
| 2006 | ||||
| Curzon Park Limited £’000 |
Wimbledon Phoenix Limited £’000 |
Luneside East Limited £’000 |
Total £’000 |
|
| Summarised income statements: | ||||
| Administrative expenses | – | (6) | – | (6) |
| Finance income | 157 | – | – | 157 |
| Profit/(loss) before and after taxation | 157 | (6) | – | 151 |
| Summarised balance sheets: | ||||
| Non-current assets | 20,020 | 222 | 241 | 20,483 |
| Current liabilities | (1) | (18) | – | (19) |
| Share of net assets | 20,019 | 204 | 241 | 20,464 |
c) Principal subsidiaries
The Group has taken advantage of the exemption under s231 of the Companies Act 1985 and presents below only those undertakings with net assets in excess of 5.0 per cent of Group net assets.
The following were principal subsidiaries at 31st December 2007:
| % holding in ordinary shares at 31st December 2007 |
Principal activity | ||
| DS Property Developments Limited* | 100 | Property Development | |
| Development Securities Estates PLC | 100 | Management and Investment Company | |
| Development Securities (Investments) PLC | 100 | Property Investment | |
| DS Jersey (No. 1) Limited | 100 | Investment | |
| DS Jersey (No. 3) Limited* | 100 | Investment | |
| DS Jersey (No. 7) Limited | 100 | Investment | |
| Kirkby Centre (No. 2) Limited* | 100 | Investment |
* indirectly held
