Panther Securities Annual Report 2015

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FY2015 Annual Report · Panther Securities

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ANNUAL REPORT &
FINANCIAL STATEMENTS

2015

Company number 293147

The Year in Brief

Revenue

Rent receivable

Profit before tax

Total comprehensive income for the year

Net assets of the Group

2015
£’000

14,443

12,840

8,470

6,852

76,097

2014
£’000
Restated

14,832

12,512

4,377

4,650

71,554

Earnings per 25p ordinary share – continuing operations

38.7p

26.8p

Dividend per ordinary share
(based on those proposed in relation to the financial year)

22p*

12p**

Net assets attributable to ordinary

shareholders per 25p ordinary share

428p

409p

* 9p was paid in 2015, 10p (special dividend) was paid in 2016 and 3p proposed.
** 3p was paid in 2014 and 9p paid in 2015

Contents

The Year in Brief

Directors, Secretary and Advisors

Chairman’s Statement

Chairman’s Ramblings

Group Strategic Report

Directors’ Report

Corporate Governance

Independent Auditors’ Report

Consolidated Income Statement

Consolidated Statement of Comprehensive Income

Consolidated Statement of Financial Position

Consolidated Statement of Changes in Equity

Consolidated Statement of Cash Flows

Notes to the Consolidated Accounts

Parent Company Statement of Financial Position

Parent Company Statement of Changes in Equity

Notes to the Parent Company Accounts

Notice of Annual General Meeting

Ten Year Review

Panther Securities P.L.C.

Directors, Secretary and Advisers

Directors

* Andrew Stewart Perloff (Chairman and Chief Executive)
** Bryan Richard Galan (Non-executive)
** Peter Michael Kellner (Non-executive)

John Terence Doyle (Executive)
John Henry Perloff (Executive)
Simon Jeffrey Peters (Finance)

Company Secretary

Simon Jeffrey Peters

Registered Office

Deneway House, 88-94 Darkes Lane, Potters Bar, Herts. EN6 1AQ

Company number

293147

Website

Auditors

Bankers

www.pantherplc.com

Nexia Smith & Williamson
25 Moorgate, London, EC2R 6AY

HSBC Bank PLC
31 Holborn, London, EC1N 4HR

Santander Corporate Banking
2 Triton Square, Regents Place, London, NW1 3AN

Natwest Bank PLC
Unit 40, 56 Churchill Square, Brighton, East Sussex, BN1 2ES

Nomad, Financial Advisers
and Joint Brokers

Allenby Capital Limited
3 St Helen’s Place, London, EC3A 6AB

Joint Brokers

Registrars

Solicitors

Raymond James Investment Services
77 Cornhill, London, EC3V 3QQ

Capita Registrars
The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU

Howard Kennedy LLP
No. 1 London Bridge, London, SE1 9BG

DMH Stallard
6 New Street Square, New Fetter Lane, London, EC4A 3BF

Brodies LLP
2 Blythswood Square, Glasgow, G2 4AD

Fox Williams LLP
Ten Dominion Street, London, EC2M 2EE

Blake Morgan LLP
New Kings Court, Tollgate, Chandler’s Ford, Eastleigh,
Hampshire, SO53 3LG

* Member of Audit Committee
** Member of the Audit Committee and Remuneration Committee

Panther Securities P.L.C.

Chairman’s Statement

I am pleased to report our results for the year ended

Stonehouse, Gloucestershire

31 December 2015. The profit shown on our

We sold a freehold vacant factory at Stonehouse for

consolidated income statement before tax amounts to

£275,000. This warehouse was attached to the 12,000

£8,470,000 compared to £4,377,000 of the previous

sq ft freehold offices occupied by our subsidiary MRG

year ended 31 December 2014. The big difference is in

Systems Ltd and thus the sale released space not

relation to property revaluations (much higher in 2014)

required or used by them. MRG also benefits from

and movements on derivative financial liabilities (very

having less overheads caused by the unfair burden of

large loss in 2014).

Results

vacant rates.

Wembley

Our revenue was £14,443,000 compared to a restated

£14,832,000 last year, which both now include the

results of our 75% owned high tech subsidiary, MRG

Systems Limited.

We sold two freehold factories on our Wembley estate

to one of the occupying tenants. The price achieved

was £3,500,000 for 26,000 sq ft of factory space which

produced £152,500 pa. This price was considerably

above last year’s valuation and approximates to what

The largest part of revenue, our rents receivable during

we paid for the whole of our Wembley estate some

the year was £12,840,000 compared to last year’s

years ago. We still own about 65,000 sq ft which is fully

£12,512,000, which is moving in the right direction as

let, with an income of £334,130 which we expect to

a result of a number of changes in our tenanted

continue to rise.

portfolio.

This substantial jump in Group profits was mainly due to

the increase in value of our investment properties of

£3,859,000 (2014: £13,110,000) as revalued by the

independent surveyors, G L Hearn Limited, who valued

our entire portfolio. Also, at the year end there was an

improvement in our “swaps liability” of £1,563,000

(2014: a loss of £9,813,000).

There were also profits of £1,074,000 from our property

disposals during this year. These realised profits were

in addition to the book values that had seen large

increases in the previous year.

Disposals

Barrhead, Glasgow

Beale Limited (Previously Beale Plc) “Beale”

In March 2015, we sold our shareholding in Beale to a

private company controlled by my family company. The

sale realised £244,000 cash for Panther, which was a

loss of £244,000 on its book value. I explained the

reasons for

this necessary sale,

in detail

in my

statement last year, under post balance sheet events

and will not repeat all of this detailed information.

In November 2014,

the then board of Beale

approached us to discuss “possible ways forward for

the benefit of all stakeholders in Beale, which was

expecting a cash crunch sometime during early 2015”.

The final result of these discussions was my family’s

successful bid that provided Beale shareholders with

some value for their shares and the company with an

A small site in Barrhead, Glasgow sold for £236,000.

extra £2,000,000 working capital. This allowed Beale, a

Although a small loss on valuation, this was a vacant

severely loss making company at the time to reorganise

former garage site that had never produced a rental

its management, saving at least £1,000,000 per annum

income for us, but was nevertheless a profit on our

by no longer being a public listed company, including a

original cost.

board costing around £600,000 pa, plus bonuses, and

Panther Securities P.L.C.

Chairman’s Statement continued

removing all the extra costs of special advisers that

group, benefitting all its “stakeholders” of 1200 staff,

were required for a listed corporation.

plus the 115 concessionaires and their own 1000 staff,

suppliers, pensioners, landlords and of course the

However, after a year of reorganisation it became

“Taxman” in its many and various guises.

apparent

that despite excellent

initial cost cutting

measures, unfortunately, due to continued flat retail sales,

When the Beale group becomes profitable its covenant

there would need to be some form of

financial

will be much enhanced and will likely cause an increase

reconstruction to remove a number of the historical

in the investment value of the portfolio of

freehold

contractual rental

liabilities. The loss making stores

properties owned by the Panther Group and let to Beale.

needed to be restructured, as turnover had declined

substantially in these locations, because of changing retail

A final note on this particular situation is that if the

patterns while rents had remained contracted at historical

government had not pursued its continued policy of

highs of the boom period some ten years or more earlier.

turning a blind eye to the excessively high property taxes

and for its continuation by deliberately deferring a rates

Thus in March 2016, it was the decision of the new

revaluation for two years and also for the continuation of

board of Beale, after taking expert advice, to enter their

the Labour policy continuing ludicrous charging of vacant

trading

subsidiary

into

a Creditors Voluntary

rates, Beales’s situation (and probably many other

Arrangement

(CVA). Although the proposal was

groups in a similar position i.e. steel industry) could have

required to be put to all creditors, due to its drafting, it

been alleviated. Beales, although loss making for some

only financially affected landlords of loss making stores,

years, were paying (and still do) almost £4,500,000 per

whereby the Beale trading company could reduce rents

year in property taxes alone!!!

payable on a number of the loss making stores and also

arrange to exit these stores, after an agreed time period

Development Progress

(to allow affected landlords to re-let or make alternative

Holloway Head, Birmingham

arrangements for their properties). When the CVA was

voted through by its creditors it became legally binding

on all the landlords affected.

Obviously, only those stores that had severe losses, due

to the aforementioned reasons, were compromised. I

am pleased to say that only two of the Panther Group’s

twelve properties let to Beale were loss making and

thus affected. Panther will lose approximately £200,000

in 2016 until their trading improves or we find alternative

tenants to occupy the properties that Beale cannot

support. I believe there will be little rental loss to us in

due course when these problems are resolved.

This site received full planning permission in November

2015 for 487 residential units and approximately 5,000

sq ft of commercial space. The planning permission

includes a separate building owned by the Girl Guides

with whom discussions are in place to rehouse them in

a new building more suited to their current requirements

than the 50 year old building that was opened in 1966

by Princess Margaret, which they currently occupy.

However, the scheme provides for development of our

site alone if necessary. Our advisers are currently

negotiating extensions to our two existing 100 year

leaseholds at nominal ground rents on 40% of the site,

the freehold of which is owned by Birmingham City

Council. When this is agreed, the development site will

This financial restructuring should also give Beale a

be put up for sale or considered for a joint development

good chance of recovering to its former self, a well-

with a more substantial and experienced major

loved, long established profitable department store

residential developer.

Panther Securities P.L.C.

Whilst I believe the London flat market may be stalling

negotiation for letting as a single unit to a multiple

due to the often high asking prices in London, which

retailer with an excellent covenant.

restricts their marketability, Birmingham has no such

current problem due to it being far more affordable and

Victoria Street, Wolverhampton

thus also suitable for the buy to let market, despite the

added taxation recently placed upon it.

This cleared site with permission for 8,000 sq ft of retail

space and 44 student units is still being marketed with

some interest. It may alternatively produce a reasonable

With many large companies moving to Birmingham and

return on book value if used for car parking, pending a

creating new office requirements, plus potential

suitable occupational tenant.

residential occupation requirements in the UK’s second

largest city, we consider strong demand should

High Street, Bromley

continue for much longer than central London.

Bruce Grove, Wickford

There has been a delay in dealing with this site with

permission for 49 houses, as one of the other parties to

a sale needs to find alternative premises for the

continuation of its business. However, it is likely the site

value for this potential residential development will have

risen, giving more leeway to assist with the move.

Old Inn House, Sutton

The entire upper part of this property consisting of

18,000 sq ft of offices, which had been mainly vacant

for many years, was sold with the benefit of Permitted

Development Rights for conversion to 28 flats. We

retained the valuable long leasehold of the ground floor

(999 years) at a peppercorn rent with fully occupied

retail sub tenants producing £129,000 p.a. The price

realised was £3,900,000 but was subject to certain

conditions, and only completed early in 2016. The

profits are not included in the accounts for the year

ended 31 December 2015.

High Street, Orpington

We have been dealing with the Local Authority in

respect of our planning application for redevelopment of

part of our property holdings in the northern High Street.

To me, it should seem a comparatively simple planning

matter, where we retain the façade and rebuild the

poorly utilised temporary buildings that occupy the large

rear part of the site. The scheme would produce a

larger modern shop unit and 24 much needed

residential apartments. So far, it has taken about two

years, with constant additional costly information

requirements.

Peckham Rye

Similarly, a parade of poor quality single storey shops,

way past their useful life, has taken nearly two years to

agree a potential redevelopment with the planners for a

new 6,000 sq ft retail unit and an attractive residential

upper part of about 15 flats. Again, desperately needed

in the locality.

In due course, when permission is

granted, this should produce profits over and above its

current book value.

For many years, we have always tried to cooperate with

the various planning departments we deal with, in an

attempt to agree, firstly, an acceptable scheme within

Despite receiving Permitted Development Rights to

the planners current brief and taste and secondly,

convert this entire upper part of circa 15,000 sq ft to 21

viability to produce a profit for us i.e. make it worthwhile

residential units it became apparent that it was more

attempting! It is probably worth noting our sites are

profitable to re-let as offices, which are now nearly fully

nearly always on what is currently called “brownfield”

let. The five ground floor shops are currently under

land i.e. ideal for redevelopment.

Panther Securities P.L.C.

Chairman’s Statement continued

I am coming to the conclusion that it may be better

Additionally, we have over £1,250,000 per annum of

to submit a scheme without consultation and

potential income if all of our vacant space was let.

immediately after the statutory two months period has

passed, submit a planning appeal, thus going to a

The approximate total current rateable value of our

higher authority. At present, the Local Authority usually

portfolio is about £14,900,000.

requests extra time to consider applications and one

feels compelled to provide it. This usually stretches to

Tenant activities during the year end 31.12.2015

two years or more, for even the most uncontroversial

During this year we gained 79 new tenants producing

developments. Also, whilst

the Local Authority

£1,018,000 pa (27 residential and 52 commercial). We

prevaricate they are very forceful

in making you pay

lost 45 tenants producing £678,000 pa (16 residential

the business rates for the vacant premises, held

and 29 commercial). Thus the net effect produces an

vacant sometimes anticipating planning permission

extra £340,000 per annum on an ongoing basis.

but more often beyond its useful life. This is a scandal

that any other sensible government would be able to

Political donations

deal with.

Once again, I have requested a resolution be submitted

at the forthcoming AGM to give £25,000 for financial

Approximate Résumé of our Portfolio

support to the UK Independence Party. Whether you

The Panther Group owns 133 separate locational

agree with all of their views or do not, it is obvious they

blocks of property, from a single shop unit to a parade

have forced the establishment to give the entire country

of up to (in one case) 44 adjoining units, or alternatively,

the right to choose whether to stay in or out of the

an industrial estate of a number of separate units. We

European community. The two major parties are much

currently have about 840 separate tenants.

of a muchness, when it comes to most things that

The Panther Group portfolio comprises:

have a third party snapping at their heels, with more

effect and concern everybody’s normal

lives and to

Retail space

Industrial space

Office space

1,600,000 sq ft

1,100,000 sq ft

380,000 sq ft

populist views, makes all politicians and bureaucrats

more responsive to the people’s actual wishes. I have

suggested that we would be better off out of the

European political experiment, which I will expand upon

Residential space (about 90 flats)

60,000 sq ft

in my ramblings.

Total

3,140,000 sq ft

Producing approximately per annum:

Retail

Industrial

Office

Residential space

£8,500,000

£3,600,000

£700,000

£450,000

Total

£13,250,000 per annum

Events after the reporting date
Old Inn House, Sutton

I have mentioned earlier the sale of the office element of

Old Inn House, the negotiations and contracts for which

straddled the year end with its final completion in 2016.

I would reiterate it was an excellent sale at £3,900,000

for the loss of little net income.

Lord Street Properties (Southport) Limited

We also own 52.5 acres of freehold practically virgin

The cash raised from the sale of Old Inn House

land with varying levels of potential for development.

facilitated the acquisition of Lord Street Properties

Panther Securities P.L.C.

(Southport) Limited announced on 8 March 2016, but

over original cost, it was considered a useful sale of a

substantially repeated here for those of you who do not

non-income producing asset.

see all regulatory announcements:-

“Panther announces that it has acquired Lord Street

Properties (Southport) Limited, a company established

as owners of Broadbents Department Store in 1896

which was in the same family until

the trading

operations were transferred to the Beale group in 1990

with Lord Street Properties retaining the freehold

interest. This company subsequently acquired the

Wayfarers Arcade freehold, which is the prime arcade in

Lord Street, Southport and reputed to be one of the

finest Victorian arcades in the country.

With the adjoining properties in Lord Street, which are

currently occupied by a Beale department store and

owned by Panther, the freehold properties contain

approximately 75,000 sq ft of retail and ancillary space

on a site of about 2 acres most of the property being

listed. To the rear of the site there are two car parks, for

the use of customers of the store and arcade and a

separate warehouse rented by Beale.

The properties produce a gross income approaching

£650,000 of which approximately one third is derived

from the Beale department store. The Arcade contains

forty eight units of which eight are vacant with a

potential extra value of £85,000 per annum.

Dividends

The Directors recommend and anticipate paying a final

dividend for the year ended 31 December 2015 of 3p

per share to be paid on 5 September 2016 to

shareholders on the register at the close of business on

19 August 2016 (Ex-dividend on 18 August 2016)

which is subject to shareholders approval. This is on top

the interim dividend of 9p per share paid on

27 November 2015 and the special dividend of 10p per

share paid on 31 March 2016, both in relation to the

year ended 31 December 2015, making a total of 22p

per share for the year.

Finance renewal

On 19 April 2016 we completed the renewal of our

£75,000,000 joint facility with HSBC and Santander for

a further 5 year term. This loan also gives us the option

of drawing a further £10,000,000 with bank approval. In

total we potentially have an additional £15,500,000

extra purchasing ability. The loan is better in most

aspects than its predecessor including keener margins,

lower arrangement and non-utilisation fees.

Those of you who are relatively long term shareholders

will be aware that we got quite a shock in 2011, when

on renewal, we went from a 26 page loan document to

a 160 page one, with numerous extra requirements and

covenants. Given that it is the same parties and banks

Panther has a close relationship with Beale and knows

with whom we have had a very good working

that this is a profitable store. The price paid for Lord

relationship for 30 years and 5 years respectively, the

Street Properties (Southport) Limited, which has no

same size loan and pretty much the same properties, I

debts, will be approximately £4,500,000 including costs

anticipated this would have been a straight forward

and was paid out of Panther’s free cash generated from

simple exercise.

previously announced property disposals.”

Queens Road, Southend

Oh how naive I am – it was even more long and drawn

out than last time. Following us reaching an amicable

This vacant freehold triple shop and upper parts was

agreement of the major terms in August 2015 with our

sold for £1,050,000 on 18 March 2016. Whilst this is

relationship team, we had a process that involved circa

reasonably well over the book value but only slightly

2,000 emails, 248 days, 200 signatures, 18 lawyers in

Panther Securities P.L.C.

Chairman’s Statement continued

8 law firms, 7 bankers, 6 conference calls, 5 meetings,

Whilst London may slow down its activity level,

2 credit committee meetings and 1 large table full of

everywhere else seems to be catching up, even if not to

ancillary documents, we now have our brand spanking

such astronomic price levels. Should the rating

new 222 page loan document that probably only two

revaluation commence in April 2017, at the correctly

people understand.

adjusted values (based on market values as at April

2015), there will be an added impetus for commercial

Luckily I no longer personally deal with the detail, but

activity everywhere outside the M25.

we all owe a special amount of gratitude to Simon

Peters and John Doyle who (with their departments)

In last year’s Annual Report, I suggested the property

shouldered most of the awesome burden of providing

market was showing signs of improvement outside

(for a second time) all the information required and

London and we were beginning to reap the benefit of

checking that the facility provided our correct workable

this. In the circumstances, we decided to cash in some

requirements.

of our chips to realise cash funds to take advantage of

any future special opportunities that may come our way

I seem to recall the days when your bank provided you

and this is still the case.

with a standard printed document with blank spaces

for you to provide the vital details i.e. address, title

Finally, I would like to thank our small but dedicated

number, borrower and terms and after your own

team of staff, growing team of financial advisers, legal

solicitor prepared a report on title for the bank it was

advisers, agents and accountants for all their hard work

signed by both parties within three or four weeks. But

during the past year, which has been even more

perhaps I dreamt that.

demanding than usual and of course, our tenants, most

of whom pay their rents and excessive and high unfair

Prospects

business rates.

Last year I felt there was optimism in the market, which

became justified by our increasing successful activities,

Andrew S Perloff

both with improving lettings and profitable sales of

Chairman

properties, together with continued progress this year,

sufficient to pay a special dividend of 10p per share.

27 April 2016

Panther Securities P.L.C.

Chairman’s Ramblings

Six months ago my brother received a letter from

dump their old rubbish in the service road. We

Barking Council threatening him with an ASBO (which

explained to the council and succeeded in obtaining

stands for Anti-Social Behaviour Order) if he did not

separate dustbins for all residential units.

stop his anti-social behaviour.

However, the service road was open at night giving

I was astonished, firstly, because not only is he an

illegal dumpers the opportunity to dump rubbish in front

extremely law abiding and sociable person but he has

of the garages or on the service road. We erected

lived abroad for many years. This was obviously

strong metal gates at some cost at either end of the

something which needed further investigation.

service roads and shortly thereafter scrap thieves stole

Astonishingly and surprisingly a few months later Bristol

with huge padlocks, which were subsequently broken

Council wrote to me jointly with my wife, also

with bolt cutters and the dumping continued, although

threatening us with an ASBO which of course could

the residential units became less of a problem.

one pair of the gates. The new ones were more secure,

mean a substantial fine or even a prison sentence.

With regard to Bristol Council threatening my wife and

This was worrying, as maybe the local Authorities had

myself to an ASBO, it was a similar situation but less

been informed that we Perloff’s were a crime family

problem case. A single freehold shop amongst four or

whose activities should be closely monitored. I delved

five others, where we owned the freehold, let on a

into my memory bank to see what on earth could have

ground lease with the tenant responsible for everything,

given them this idea. The only possibility was that

as they have the major interest. The property title also

sometime in the 1930’s, my father and his two brothers

included the freehold of the service yard. This was very

owned a small row of houses in Valence Road, London

obviously used by all the shop traders and no doubt,

E1, which were subject to a CPO for a nominal sum by

the rubbish would have been dealt with by them if

the government of the day, on the grounds they were

asked. However, the council’s first reaction is to issue

slum properties. More importantly, some of you will be

landlords/owners with drastic threatening legislation

aware that those notorious gangsters the Krays lived

that was not intended for these situations.

there some years later. As is often the case, perhaps

the local authorities had got us confused.

What the council are actually doing is trying to punish

the victims of a crime, i.e. dumping, when they have

The reason for my brother’s ASBO, is that he owned a

failed to either protect or catch the criminals involved,

parade of shops and upper parts, all

let on ground

even when evidence is available.

rents, where the tenants have the substantial interest

and were responsible for everything, and were able to

The original idea of ASBOs was to prevent feral gangs

sublet as they wish but also owning a rear service road

of youngsters making life unbearable for

their

and a number of lock up garages. It became apparent

neighbours on big estates. The Local Authorities have

that the upper parts were increasingly being sublet as

once again misused their powers, as they see it as an

flats on short term lettings and each time they were

easy way out and seem to have an anti-Landlord

newly occupied, the tenants or their landlords would

tendency.

Panther Securities P.L.C.

Chairman’s Ramblings continued

Commercial business rates of about £25 billion per year

Due to my reduced circumstances, I gradually began

are paid by owners or occupiers. One may ask what

to notice that some of our friends were much more

they receive in return.

lavish in their choices, than we were. They would order

a number of preprandial cocktails, often the more

Protection from theft including shoplifting? – NO

expensive choices on the menu together with the finest

Protection from vandalism and graffiti? – NO

wines with cigars and liqueurs to finish. I couldn’t help

but notice that

they often seemed to run out of

Protection from rubbish dumpers? – NO

cigarettes and order a pack to be put on the bill.

Protection from petty theft of building materials like lead

or copper wire from existing buildings (which although

low value is expensive to remedy)? – NO

If I had not at that time been having personal cash flow

problems of my own,

I may not have taken any

particular notice of the fact that these lavish diners were

Provision for sufficient suitable car parking for

most certainly not so lavish, when they footed the bill

shoppers? – NO

themselves. The fact that my then wife and I hardly

drank and did not smoke, caused me to have a serious

I suppose one could call an ASBO – Absolutely,

quandary as I liked this group of friends but they did not

Senseless, Bureaucratic, Officialdom.

seem to realise that their actions were unreasonable.

The final straw came when one of our friends, who had

Being called anti-social reminds me of another story

a high-flying job with a big corporation, asked if he

from my past. Some forty five years ago, when I first got

could pay on “his” card and we give him our share in

married (with hindsight a little too hastily), my new wife

cash, which was how we usually paid but he had done

and I moved from south London to north London and

this before. I

looked at his card and said “it’s your

within a year or two had a new group of friends, who

company card, so are they paying for us”. He made an

lived in the area.

excuse saying he had forgotten to take cash out that

day and that his personal expenses were sorted out by

Our social group revolved around maybe six to eight

the company every month.

other like-minded, young married couples.

I know readers are wondering where this is leading me

We and our new friends soon fell into a routine of visiting

to. Well, I suspect there are many people like this, who

different restaurants nearly every weekend. Sometimes

are very happy to share big expenses they incur but

the restaurants were modest affairs, occasionally the

cannot

really afford out of

their own income.

latest “in place”. I enjoyed and indeed still enjoy my food

Nevertheless, it is only human nature to take advantage

and therefore it rarely mattered to me where we went.

of financial situations that come your way.

At the end of the meal the bill was split equally between

the couples, whatever anyone had ordered.

This quite easily leads me on to why I believe we should

support the UK Independence Party and its wish to exit

At that time, the property market was booming and I

the European Union. After all, if you break it down to its

was doing well. However, a few years later, just after the

simplest component, it is only like my dining club but

property crash of the mid-seventies, times were much

with 28 members all jostling to take advantage of some

harder and whilst I cut back where I could, our social life

other country picking up the bill for its own choice of

continued only slightly abated.

largesse.

Panther Securities P.L.C.

I believe Britain is the second largest payer into the pot

but is heavily crowded (I am astonished how it does not

after Germany. We chip in about £10 billion and

make huge profits).

is not easy and also very

probably pay out an extra £20 billion in costs, not

expensive to increase capacity.

entirely necessary for our country. We buy far more of

their products than they buy from us. I suspect the

With a generous and easily manipulated social security

figures are worse than our Europhile bureaucrats inform

system, where you are offered a home, an income,

us, as a proportion of British exports go to the big

which is now guaranteed to rise, health cover,

European ports for re-export to outside of the European

education for your children and if you have a low paying

Union, but are almost certainly included in our exports

job, your income is generously topped up – it is easy to

reported as to the European Union.

see why this country attracts so many. This is all being

provided by a country that spends £70 billion a year

With bureaucrats, so much is smoke and mirrors to

more than it receives in taxes. The tax rates are already

deceive the majority of the population because it suits

high and together with the ever widening extent of them

bureaucrats to be part of government that is not

are driving some of the most successful people out of

answerable to its electors. The European budget

the country to less confiscatory regimes, leaving a

expenditure has not been signed off as true and

bigger burden on those remaining.

accurate for nearly twenty years. If any public company

had such a damning audit so often, they would be de-

There is much talk of job losses, should we leave the

listed and quickly be out of business thereafter.

EU. There is only one worry people should have and

that is if we stay in. Our free healthcare, free education

You do not have to be clever to see the problems

system (until University, which then is a free choice), our

arising from the policies we are tied to. If we cannot

state financial protection benefits etc., will break down

control our borders, our very small country and

under the weight of the extra 2 to 3 million possibly 4

England, in particular, will find itself with another 2.5 to

million people arriving over the next five years. The

3.5 million people taking up residence here. We cannot

cracks in the system are already visible and can only

house this extra population. We could probably almost

become more evident over the coming years.

house our existing population if more sensible planning

rules were applied, but new homes would never arrive

At present, the country is maintaining its system by way

as fast as financial migrants.

of a mountain of debt, with deliberately and artificially

Our schools are under pressure from extra children

as they must in due course, this country’s largesse will

arriving. On numbers alone, it is a problem ignoring the

be even more difficult to maintain. Why make it worse

fact that many need extra attention, as English is not

by staying in a Club that allows every one of its 500

constrained low interest rates. When these rates rise,

their first language.

million members to take advantage of one of the most

generous and more successful member countries.

Our health service is under enormous pressure due to

constantly increasing demands

My Chairman’s report mentions the CVA for Beale and I

Our roads are overcrowded and an unduly growing

creditors were entitled to a vote per pound of debt. It is

population can only make it worse. Our public transport

simple for suppliers etc., whose debt was easily

system, on the few times I use it, seems to work well

established. However, for landlords where they have

have already told you it was approved. Basically, all

Panther Securities P.L.C.

Chairman’s Ramblings continued

different term contracts and rents and additional liabilities

liquidators’ terms, to hell with the personal tragedy of all

there are approved formulae to value their interest and

the employees. When I first started in the property

potential loss, if the lease is compromised with a lower

business it was almost unthinkable that an institution

rent or extinguished before its contractual term.

would act that way. I am saddened in the way their

business style has changed.

In this particular CVA, only landlords have been

compromised and even then only those properties

Lastly, but not least, was one of the largest creditors

where the trading continues to make losses in their

owed almost £1,000,000, who under the arrangements

units. It is normally expected that some landlords, who

would be paid in full but merely about one month late on

will be losing out in the arrangement, will vote against

a successful CVA and have now been paid. They voted

the CVA, but as the profitable stores would have no

against the CVA and when questioned replied “it was a

change, these landlords would vote in favour.

policy decision” – one has to laugh were it not so

This successful CVA allowed all suppliers to be paid in

full and have a continued relationship with the group

and thus virtually all votes were in favour. To the extent

that 92% voted in favour of the CVA arrangements and

as only 75% were needed, it was approved. This meant

the favourable change in Beale lease terms became

legally enforceable.

If it had failed to be approved, most creditors would

have received pennies in the pound on their debts after

a likely liquidation, 2,400 people’s jobs would be lost

and 700 pensioners would have their pensions

adversely affected. In addition landlords would have had

vacant properties to deal with at short notice. All of this

serious a situation. This was because it was HMRC,

who would not only lose most of the £1,000,000 but

also have to pay out benefits to 2,500 people about

£5,000,000, if only for six months and lose another

£2,000,000 in business rates whilst a liquidation is

sorted out, not

to mention all

future VAT, PAYE,

business rates and hopefully one day corporation tax.

Is it any wonder that our industrious hard working

country is in such a poor financial state, when our

leading tax collectors make a “policy decision” so

ludicrously against their own interest.

As a good Jewish boy with his dying words to his

tormentors once said “OH GOD FORGIVE THEM,

is, of course, most undesirable, so sometimes a vote

THEY KNOW NOT WHAT THEY DO”.

may not just have been about money which is why

most compromised landlords voted in favour. One

surprise was one institutional

landlord, who was not

being compromised and voted against the CVA. Their

lease was on very favourable terms to Beale, having

been granted fifty years ago at a fixed rent and the

Yours,

Andrew S Perloff

Chairman

institution would dearly wish to buy it back on

27 April 2016

Panther Securities P.L.C.

Group Strategic Report

About the Group
Panther Securities PLC is a property investment
company listed on the AIM market (AIM). Prior to
31 December 2013 the Company was fully listed and
included in the FTSE fledgling index. It was first fully
listed as a public company in 1934. The Group owns
and manages over 800 individual property units within
approximately 130 separately designated buildings over
the mainland United Kingdom.

The Group specialises in property investing and
managing of good secondary retail, industrial units and
offices, and also owns and manages many residential
flats in several town centre locations.

Strategic objective
The primary objective of the Group is to maximise long-
term returns for our shareholders by stable growth in
net asset value and dividend per share,
from a
consistent and sustainable rental income stream.

Progress indicators
Progress will be measured mainly through financial
results, the Board considers the business successful if
it can increase shareholder return and asset value in the
long-term, whilst keeping acceptable levels of risk by
ensuring gearing covenants are well maintained.

Key Ratios and measures

Gross Profit Margin (Gross profit/turnover)

Gearing (debt*/(debt* + equity))

Interest Cover**

Finance cost rate (finance costs/average

borrowings for the year)

Yield (rents investment properties/average

market value investment properties)

Net assets value per share

Earnings per share – continuing

Dividend per share

Investment property acquisitions

Investment property disposal proceeds

2015

73%

48%

2014

66%

50%

2013

77%

51%

2012

69%

53%

1.65 times

1.22 times

1.38 times

1.25 times

6.6%

6.7%

6.9%

7.2%

428p

38.7p

22p***

£2.2m

£4.0m

7.5%

409p

26.1p

12.0p

£3.2m

£1.2m

7.9%

395p

42.0p

12.0p

£5.3m

£2.2m

7.4%

367p

(17.2)p

12.0p

£11.4m

£0.6m

* Debt in short and long term loans, excluding any liability on financial derivatives

** Profit before taxation excluding interest, less movement on investment properties and on financial instruments

and impairments, divided by interest

*** Includes 10p per share special dividend

Business Review
The Group turnover was down slightly due entirely to
MRG Systems Ltd (“MRG”) which saw a decline. The
rental business, the Group’s core activity, showed a
2.6% increase in rents and overall the Group’s gross
profitability, which includes all segments, has improved
on 2014. We have seen a reduction in cost of sales
which aided this increased profitability in 2015, when
compared to the prior year. This was almost entirely due

to the large repair works undertaken on Wimbledon
Studios in 2014, whereas in 2015 there were not any
repair works of
the overall
reduction in costs of sales related to MRG and their
decline in trading.

this magnitude. Half

The Group continued to benefit from improvement in
the property market with the portfolio showing a further
£3.9 million uplift (2014 – £13.1 million uplift) following

Panther Securities P.L.C.

Group Strategic Report continued

another independent valuation by GL Hearn. The Board
is still only investing in special situations (as with the
prior year) and its main push continues to be on
disposals to realise profits in this positive market. We
announced on 19 January 2016 that disposals have
taken place during 2015 and others are expected in the
first half of 2016,
referred to
£10.6 million of proceeds being generated (which
included £0.2 million on shares). As a further update we
now expect this figure will be approximately £9.8 million
as the option on Swindon Market was not taken up.
£4.2 million was received in 2015 and a further
£5.0 million has been received in 2016 to date.

the announcement

turnover;

When comparing our disposals and recent acquisitions
in terms of
the properties (and shares)
disposed of for £9.8 million, were generating £226,000
of income per annum (£158,000 net due to vacant
service charges in Sutton upper parts) across these
assets. We completed a corporate acquisition, in March
2016, of Lord Street Properties (Southport) Ltd as
detailed in our announcement of 8 March 2016. The
Southport company purchased for circa £4.5 million will
generate income of £650,000 per annum (before
vacant costs) for the Group. This switch should leave
us a long way in front especially when you note we only
invested half the disposal proceeds.

The letting of Wimbledon Studios, which took place last
year, still has a significant impact on these financial
statements and the Group. In particular the prior year’s
cash flow is very strong due to the pre-payment of
£2,625,000, being two and a half years’
in
advance. In the current year Income Statement we
reflect a full year’s rental income for this property but no
cash as it was received last year.

rent

There are some uncertainties going forward which may
affect property prices, but many of our properties are
based outside London, and the values outside are still
catching up. As such, we still anticipate the market
being stable or growing for our properties and that we
have time to create or realise value, especially on our
sites that are suitable for residential redevelopment.

Financing
The Group entered into a £75 million club loan facility
(£60 million term and £15 million revolving), with HSBC
and Santander, in July 2011, of which we have paid
back £2 million of the term element. These facilities
were renewed and the loan was amended and restated
on 19 April 2016 for a further 5 year term, providing the
Group with an extra £2 million (term loan). We also
renewed the revolving facility part of the loan which has
£3.5 million undrawn. This restated loan has the
additional option of increasing it by a further £10 million
(subject
the
refinancing gives the Group £15.5 million potential
further funds to invest.

to the banks approval), so in total

At the statement of financial position date the Group
had £4.4 million of cash funds.

The Group did not offer the scrip dividend option for the
2015 interim of 9p per share dividend, or the 10p
special dividend paid on the 31 March 2016.

Financial derivative
We have seen a fair value gain in our long term liability
on derivative financial instruments of £1.6 million (2014:
£9.8 million fair value loss). Following this gain the total
derivative financial
liability on our Consolidated
Statement of Financial Position is £22.9 million (2014:
£24.5 million).

These financial instruments (shown in note 29) are our
interest rate swaps that were entered into to remove the
cash flow risk of interest rates increasing, by fixing our
interest costs. We have seen in uncertain economic
times that there can be large swings in the accounting
valuations. Small movements in the expectation of
future interest rates can have a significant impact on
their fair value; this is partly due to their long dated
nature.

These contracts were entered into in 2008 when long
In a
term interest
hypothetical world if we could fix our interest at current
rates and term we would have much lower interest

rates were significantly higher.

Panther Securities P.L.C.

costs. Of course we cannot undo these contracts that
were entered into historically, but
for accounting
purposes these financial instruments are compared to
current market
liability
compared to the market shown on our Statement of
Financial Position.

rates, with the additional

Financial Risk Management

The Company and Group operations expose it to a
variety of financial risks, the main two being the effects
of changes in credit risk of tenants and interest rate
movement exposure on borrowings. The Company and
Group have in place a risk management programme
that seeks to limit the adverse effects on the financial
performance of the Company and Group by monitoring
and managing levels of debt finance and the related
finance costs. The Company and Group also use
interest rate swaps to protect against adverse interest
rate movements with no hedge accounting applied.
Mark to market valuations on our financial instruments
have been erratic due to current low market interest
rates and due to their long term nature. These large
mark to market movements are shown within the
income statement. However, the actual cash outlay
effect is nil when considered alongside the term loan,
as the instruments have been used to fix the risk of
further cash outlays due to interest rate rises or can be
considered as a method of locking in returns (difference
between rent yield and interest paid at a fixed rate).

Given the size of the Company and Group, the Directors
have not delegated the responsibility of monitoring
financial risk management to a sub-committee of the
Board. The policies set by the Board of Directors are
implemented by the Company and Group’s finance
department.

Price risk

The Company and Group are exposed to price risk due
to normal inflationary increases in the purchase price of
the goods and services it purchases in the UK. The

Company and Group also have price exposure on listed
equities that are held as investments. The Group has a
policy of holding only a small proportion of its assets as
listed investments. The exposure of the Company and
Group to inflation is low due to the low cost base of the
Group and natural hedge we have owning “real” assets.
Price risk on income is protected by the rent review
clauses contained within our tenancy agreements and
often secured by medium or long term leases.

Credit risk

The Company and Group have implemented policies
that require appropriate credit checks on potential
tenants before lettings are agreed. In many cases a
deposit is requested unless the tenant can provide a
strong personal or other guarantee. The amount of
exposure to any individual counterparty is subject to a
limit, which is reassessed annually by the Board.

Exposure is reduced significantly due to the Group
tenants who operate in
having a large spread of
different industries.

Liquidity risk

The Company and Group actively manage liquidity by
maintaining a long-term finance facility, strong
relationships with many banks and holding cash
reserves. This ensures that the Company and Group
have sufficient available funds for operations and
planned expansion or the ability to arrange such.

Interest rate risk

The Company and Group have both interest bearing
assets and interest bearing liabilities. Interest bearing
assets consist of cash balances which earn interest at
fixed rate when placed on deposit. The Company and
Group have a policy of only borrowing debt to finance
the purchase of cash generating assets (or assets with
the potential to generate cash). The Directors revisit the
appropriateness of this policy annually.

Panther Securities P.L.C.

Group Strategic Report continued

Other non financial risks
The Directors consider that the following are potentially material non-financial risks.

Risk

Impact

Action taken to mitigate

Reputation

Raise capital/deal flow reduced

Act honourably, invest well, be prudent.

Regulatory changes

Transactional and holding costs Seek high returns to cover additional costs.
increase

Lobby Government -“Ramblings”.

People related issues

Loss of key employees/low
morale/inadequate skills

Computer failure

Loss of data, debtor history

Maintain market level remuneration packages, flexible
working and training. Strong succession planning and
recruitment. Suitable working environment.

External IT consultants, backups, offsite copies. Latest
virus and internet software.

Asset management

Wrong asset mix, asset illiquidity Draw on wealth of experience to ensure balance

between income producing and development
opportunities. Continued spread of tenancies and
geographical location. Manage the economic cycles.

This report was approved and authorised for issue by the Board and signed on its behalf by:

S. J. Peters
Company Secretary

Dated: 27 April 2016

Deneway House
88-94 Darkes Lane
Potters Bar
Hertfordshire EN6 1AQ

Panther Securities P.L.C.

Directors’ Report
Company number 293147

The Directors submit their report together with the
audited financial statements of the Company and of the
Group for the year ended 31 December 2015.

taking reasonable steps for
detection of fraud and other irregularities.

the prevention and

Directors’ Responsibilities Statement

The directors are responsible for preparing the Strategic
the Directors’ Report and the financial
Report,
statements in accordance with applicable law and
regulations.

Company law requires the directors to prepare financial
statements for each financial year. Under that law the
directors have elected to prepare the Group financial
statements in accordance with applicable law and
International Financial Reporting Standards (IFRSs) as
adopted by the European Union and the Company
financial statements in accordance with United
Kingdom Generally Accepted Accounting Practice (UK
including FRS101 “Reduced Disclosure
GAAP)
Framework”. Under company law the directors must
not approve the financial statements unless they are
satisfied that they give a true and fair view of the state
of affairs of the Company and of the Group and of the
profit or loss of the Group for that period.

In preparing these financial statements, the directors are
required to:

l select suitable accounting policies and then apply

them consistently;

l make judgments and accounting estimates that are

reasonable and prudent;

l state whether applicable IFRSs as adopted by the
European Union have been followed subject to any
material departures disclosed and explained in the
Group financial statements; and

l prepare the financial statements on the going
concern basis unless it is inappropriate to presume
that the Group will continue in business.

The directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the company’s transactions and disclose with
reasonable accuracy at any time the financial position of
the company and enable them to ensure that the
financial statements comply with the Companies Act
2006. They are also responsible for safeguarding the
assets of the Company and the Group and hence for

The directors are responsible for the maintenance and
integrity of the corporate and financial
information
included on the Company’s website. Legislation in the
United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.

Going concern
The Group’s business activities, together with the
factors likely to affect
its future development,
performance and position are set out in the Chairman’s
Statement and Group Strategic Report. The financial
position of the Group, including key financial ratios is
set out in the Group Strategic Report. In addition, the
Directors’ Report
includes the Group’s objectives,
policies and processes for managing its capital; the
Group Strategic Report includes details of its financial
risk management objectives; and the notes to the
accounts provide details of its financial instruments and
hedging activities, and its exposures to credit risk and
liquidity risk.

The Group is strongly capitalised, has reasonable
liquidity together with a number of long term contracts
with its customers many of which are household
names. The Group has a diverse spread of tenants
across most
industries and investment properties
based in many locations across the county.

The Group typically has a long term loan in place. In
2015 this was shown as short-term, however this has
been renewed on 19 April 2016. The Groups always
maintains excellent relations with its lenders.

The Directors believe the Group is very well placed to
manage its business risks successfully and have a good
expectation that both the Company and the Group
have adequate resources to continue their operations.
For these reasons they continue to adopt the going
concern basis in preparing the financial statements.

Principal activities, review of business and future
developments
The principal activity of
investment and dealing in property and securities.

the Group consists of

The review of activities during the year and future
developments is contained in the Chairman’s Statement
and Group Strategic Report.

Panther Securities P.L.C.

Directors’ Report continued

Company’s objectives and management of capital
Our primary objective is to maximise long-term return
for our shareholders by stable growth in net asset value
and dividend per share,
from a consistent and
sustainable rental income stream.

Directors and their beneficial interests in shares
of the Company
The Directors who served during the year and their
beneficial
interests in the Company’s issued share
capital were:

The Company’s principal capital base includes share
capital and retained reserves, which is prudently
invested to achieve the above objective and is
supplemented with medium to long-term bank finance.

Results and dividends
The profit for the year after taxation, amounted to
£6,813,000 (2014: £4,692,000).

The interim dividend of £1,597,000 (9.0p per share) on
ordinary shares was paid on 27 November 2015. A
further special dividend of 10p per share, in relation to
2015, was announced on 19 January 2016 and paid
on 31 March 2016.

The Directors recommend a final dividend of £532,000
(3.0p per share) payable on 5 September 2016 to
shareholders on the register at the close of business on
19 August 2016 (Ex dividend on 18 August 2016). The
total dividend for the year ended 31 December 2015
being anticipated at 22p.

There will be no option of a scrip dividend offered for
the 2015 final dividend of 3p per share. There was no
scrip option for the interim dividend in November 2015
or the special dividend in March 16.

Ordinary shares
of £0.25 each
2014

2015

A. S. Perloff (Chairman)
B. R. Galan (Non – executive)
P. M. Kellner (Non – executive)
J. T. Doyle
J. H. Perloff
S. J. Peters

4,244,360 4,241,783
323,902
22,000
63,460
107,500
183,143

332,669
22,000
63,460
107,500
187,929

A. S. Perloff and his family trusts have beneficial
interests in shares owned by Portnard Limited, a
Company under their control, amounting to 8,405,175
(2014 – 8,183,662).

have been

There
shareholdings since 31 December 2015.

changes

in Directors’

interest

No beneficial
is attached to any shares
registered in the names of Directors in the Company’s
subsidiaries. No right has been granted by the
Company to subscribe for shares in or debentures of
the Company.

Directors’ emoluments
Directors’ emoluments of £290,000 (2014 – £288,000) are made up as follows:

Director

Executive
A. S. Perloff
J. T. Doyle
J. H. Perloff
S. J. Peters

Non-executive
B. R. Galan
P. M. Kellner

Panther Securities P.L.C.

Salary/
Fees
£’000

Bonus
£’000

Taxable
Pension
Benefit Contribution
£’000
£’000

Total
2015
£’000

Total
2014
£’000

10
3
1
—

—
—

—
—
—
30

—
—

10
101
52
107

10
10

290

5
103
53
107

10
10

288

—
77
46
56

10
10

199

—
21
5
21

—
—

Pension and other benefits
A. S. Perloff is the sole member and beneficiary of a
non-contributory Director’s pension scheme. The Group
ceased contributions in 1997 and accordingly made no
contributions to the pension fund in 2015 and does not
anticipate making further contributions.

S. J. Peters had pension contributions paid in the year
by the Company of £30,000 (2014 – £36,000) into his
personal stakeholders’ contribution pension scheme.

No other payments were paid in respect of any other
Director during the year (2014 – £nil).

Third party indemnity provision for Directors
Qualifying third party indemnity provision for the benefit
of six directors was in force during the financial year and
as at the date this report was approved.

Capital structure
Details of the issued share capital of the Company are
shown in note 24. The Company has one class of
ordinary shares which carries no right to fixed income.
Each share carries the right to one vote at general
meetings of the Company. The details of the Group’s
treasury policy are shown in note 29.

Financial risk management
Information regarding the use of financial instruments
and the approach to financial risk management is
detailed in the Strategic Report.

Donations
During the year the Group made £25,000 political
donations (2014 – £17,500). The Group makes donations
to charities through advertisements at charity events and
in the diaries of charities, the total of which in 2015 was
£5,000 (2014 – £3,000). The Group is a Foundation
Partner of the preferred charity of the property industry,
Land Aid, donating £10,000 (2014 – £10,000).

Status
Panther Securities P.L.C. is a Company listed on the
Alternative
and is
incorporated in United Kingdom.

Investment Market

(“AIM”)

Events after the reporting date
In January 2016 the Group completed the sale on a
conditional contract for the upper parts of Old Inn
House, Sutton for £3,900,000 (before costs).

In March 2016 the Group purchased Lord Street
Properties (Southport) Ltd for £4,500,000 (including
costs).

In March 2016, JE Beale PLC (a subsidiary of Beale Ltd)
(“Beale”), entered and had approved a landlords only
(“CVA”), which
Creditors Voluntary Arrangement
affected two of Panther’s property investments. Beale
have the right to exit these stores in 10 months, and will
pay a third of the rent in the meantime, the pre-CVA
combined rent being £350,000. This process however
does put Beale into a stronger financial position, which
make rental streams on other investment properties
owned by Panther, where Beale is a tenant, more
secure.

On 19 April 2016 the Group renewed its £75,000,000
loan facility by entering into a new 5 year term loan with
HSBC and Santander. The Group has the option to
draw down an additional £10,000,000 under the same
agreement subject
to the banks credit approval
process.

Auditors
In the case of each person who was a Director at the
time this report was approved:

l so far as that Director was aware there was no
relevant available information of which the
Company’s auditors were unaware; and

l that Director had taken all steps that the Director
ought to have taken as a Director to make himself
aware of any relevant audit information and to
establish that the Company’s auditors were aware
of that information.

This information is given and should be interpreted in
accordance with the provisions of s418 of
the
Companies Act 2006.

A resolution to re-appoint the auditors, Nexia Smith &
Williamson, will be proposed at the next Annual General
Meeting.

This report was approved and authorised for issue by
the Board and signed on its behalf by:

S. J. Peters
Company Secretary

Deneway House
88-94 Darkes Lane
Potters Bar
Hertfordshire EN6 1AQ

Panther Securities P.L.C.

In March 2016 the group disposed of a property in
Southend for £1,050,000 (before costs).

Dated: 27 April 2016

Corporate Governance

it did not

Panther Securities P.L.C. Board recognise the
importance of sound Corporate Governance. However
fully comply with the UK
during 2015,
Corporate Governance Code, issued by the Financial
Reporting Council, as in the Board’s view it would have
been too onerous. Nevertheless, the Company has
regard for the main provisions as far as is practicable
and appropriate for a public company of its size.

The Board
The Board currently consists of six Directors, of whom
two are non-executives. It meets regularly during each
year to review appropriate strategic, operational and
financial matters and otherwise as required. In the year
the Board met three times with all members present. It
supervises the executive management and a schedule
of items reserved for the full Board’s approval is in place.
Panther Securities P.L.C. has an Executive Chairman
who is also the Chief Executive.

The Board considers the two non-executive Directors to
be independent and to represent
the interests of
shareholders. Both non-executive Directors are of the
highest calibre. Each is independently minded with a
breadth of successful business and relevant experience.
They are entitled to the same information as the
Executive Directors and are an integral part of the team,
making a most valuable contribution. Both non-executive
Directors have a sufficient level of expertise to challenge
and hold the executive Directors to account.

Each Board member has responsibility to ensure that the
Group’s strategies lead to increased shareholder value.

Biographical details of Executive Directors:-

Andrew Perloff (Chairman)
He has over 50 years’ experience in the property sector,
including over 40 years’ experience of being a Director
of a Public Listed Company mainly as Panther’s
Chairman. He has significant experience of corporate
activity including ten contested take-over bids and has
also served on the Board of Directors of 6 other public
listed companies. He is currently a non-executive
director of Beale Ltd and Airsprung Furniture Ltd

Simon Peters (Finance Director)
He is a member of the Chartered Institute of Taxation,
a Fellow of the Chartered Certified Accountants and
was formerly with KPMG LLP and the Lombard Bank
Finance Department. He is currently a non-executive
director of Beale Ltd and Airsprung Furniture Ltd. He

joined Panther in 2004 and was appointed Finance
Director in 2005.

John Doyle (Executive)
He is a member of the Royal Institution of Chartered
Surveyors and was previously with London Electricity
plc and Chesterton International plc, having worked in
the property sector since 1989, he joined Panther in
January 2001. His areas of
responsibility include
property acquisition and disposal, asset management
and development. He was appointed Executive
Director in 2005.

John Perloff (Executive)
Previously with a commercial West End agent
specialising in retail acquisitions and disposals, he
joined Panther in 1994. His areas of responsibility
include property lettings and acquisitions. He was
appointed Executive Director in 2005.

Biographical details of Non-executive Directors:-

Bryan Galan (Non-executive)
Chairman of the Remuneration Committee. He is a
Fellow of the Royal Institution of Chartered Surveyors.
He was
joint Managing Director of
Amalgamated Investment and Property Co. Limited and
was previously a Non-executive Director of Rugby
Estates Investment Trust Plc.

formerly

Peter Kellner (Non-executive)
Chairman of the Audit and Nomination Committees. He
is an Associate of the Chartered Institute of Bankers
and of the Institute of Taxation. He was formerly joint
General Manager of the U.K. banking operations of
Credit Lyonnais Bank Nederland NV.

Communication with shareholders
The Company provides extensive information about the
Group’s activities in the Annual Report and Financial
Statements and the Interim Report, copies of which are
sent to shareholders. Additional copies are available by
application. The Group is active in communicating with
both its institutional and private shareholders and
welcomes queries on matters relating to shareholdings
and the business of the Group. All shareholders are
encouraged to attend the Annual General Meeting, at
which Directors and senior management are introduced
and are available for questions. The Company provides
a website with up to date information,
including
announcements and company accounts.

Panther Securities P.L.C.

Audit Committee
The Audit Committee has three members including
both non-executive Directors and an executive Director
(being Andrew Perloff) and it is chaired by Peter Kellner.
Its terms of reference, which are available from the
Company’s registered office, are that it meets at least
twice a year to review the Group’s accounting policies,
financial and other reporting procedures, with the
external auditors in attendance when appropriate. In
2015 the committee met three times with all members
present.

The internal controls are reviewed annually ensuring
their effectiveness and any specific issues are dealt with
if and when they arise. When the Board reviews internal
controls they consider the effectiveness of controls,
concentrating on all material controls,
including
operational and compliance controls, and risk
management systems.

Remuneration Committee
The Remuneration Committee consists solely of the two
non-executive Directors, Bryan Galan (Chairman) and
Peter Kellner. It reviews the terms and conditions of
service of
the Chairman and Executive Directors,
ensuring that salaries and benefits satisfy performance
and other criteria. When setting remuneration the
Committee consults with the Chairman of the Board
and no external third parties are consulted. In 2015 the
Committee met three times with all members present.

Remuneration policy
Company policy is to reward fairly the Executive
Directors sufficiently to retain and motivate these key
individuals. In determining remuneration, consideration
is given to their role, their performance, reward levels
throughout the organisation, as well as the external
employment market. The Remuneration Committee
considers that currently the Executive Directors’
remuneration is below market comparables. The only
element of
specific
performance is the bonuses, however this is adjusted to
reflect market conditions and company results.

remuneration that

reflects

Panther Securities P.L.C.

Independent Auditors’ Report

Independent Auditor’s Report to the Members of Panther Securities P.L.C.
We have audited the financial statements of Panther Securities P.L.C. for the year ended 31 December 2015 which
comprise the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income, the
Consolidated Statement of Financial Position, the Consolidated Statement of Changes in Equity, the Consolidated
Statement of Cash Flows, the Parent Company Statement of Financial Position, the Parent Company Statement of
Changes in Equity and related notes 1 to 49. The financial reporting framework that has been applied in the
preparation of the Consolidated Financial Statements is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the European Union. The financial reporting framework that has been applied in
the preparation of the Parent Company financial statements is applicable law and United Kingdom Accounting
Standards (United Kingdom Generally Accepted Accounting Practice) including FRS101 “Reduced Disclosure
Framework”.

This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s members
those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditor
As explained more fully in the Directors’ Responsibilities Statement, the Directors are responsible for the preparation
of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and
express an opinion on the financial statements in accordance with applicable law and International Standards on
Auditing (UK and Ireland). Those standards require us to comply with the Financial Reporting Council’s (FRC’s) Ethical
Standards for Auditors.

Scope of the audit of the financial statements
A description of
www.frc.org.uk/auditscopeukprivate.

the scope of an audit of

financial statements is provided on the FRC’s website at

Opinion on financial statements
In our opinion:

(cid:1)

the financial statements give a true and fair view of the state of the Group’s and of the Parent Company’s
affairs as at 31 December 2015 and of the Group’s profit for the year then ended;

the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the
European Union;

the Parent Company financial statements have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and

the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006
In our opinion the information given in the Strategic Report and the Directors’ Report for the financial year for which
the financial statements are prepared is consistent with the financial statements.

Panther Securities P.L.C.

Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report
to you if, in our opinion:

(cid:1)

adequate accounting records have not been kept by the Parent Company, or returns adequate for our audit
have not been received from branches not visited by us; or

the Parent Company financial statements are not in agreement with the accounting records and returns; or

certain disclosures of directors’ remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.

Stephen Drew
Senior Statutory Auditor, for and on behalf of
Nexia Smith & Williamson
Statutory Auditor
Chartered Accountants

25 Moorgate
London
EC2R 6AY

27 April 2016

Panther Securities P.L.C.

Consolidated Income Statement
For the year ended 31 December 2015

Notes

Revenue

Cost of sales

Gross profit

Other income

Administrative expenses

Profit/(loss) on disposal of investment properties

Movement in fair value of investment properties

Finance costs

Investment income

Loss (realised) on the disposal of available for

sale investments (shares)

Loss on disposal of plant and equipment

Reversal of impairment of available for sale investments (shares)

Fair value gain/(loss) on derivative financial liabilities

Profit before income tax

Income tax (expense)/credit

Profit for the year

Attributable to:

Equity holders of the parent

Non-controlling interest

Profit for the year

Earnings per share

31 December
2015
£’000

31 December
2014
£’000
Restated

14,443

(3,824)

10,619

294

(3,540)

7,373

1,074

3,859

12,306

(5,186)

(244)

—

1,563

8,470

(1,657)

6,813

6,815

(2)

6,813

14,832

(5,044)

9,788

283

(3,698)

6,373

(57)

13,110

19,426

(5,268)

—

(22)

(9,813)

4,377

315

4,692

4,650

4,692

26.8p

Basic and diluted – continuing operations

38.7p

Panther Securities P.L.C.

Consolidated Statement of Comprehensive Income
For the year ended 31 December 2015

Profit for the year

Other comprehensive income

Items that may be reclassified subsequently

to profit or loss

Movement in fair value of available for

sale investments (shares) taken to equity

Deferred tax relating to movement in fair value of

available for sale investments (shares) taken to equity

Other comprehensive income for the year, net of tax

Notes

31 December
2015
£’000

31 December
2014
£’000
Restated

6,813

4,692

(8)

—

Total comprehensive income for the year

6,850

4,692

Attributable to:

Equity holders of the parent

Non-controlling interest

6,852

(2)

6,850

4,650

4,692

Panther Securities P.L.C.

Consolidated Statement of Financial Position
Company number 293147

As at 31 December 2015

ASSETS
Non-current assets
Plant and equipment
Investment property
Deferred tax asset
Available for sale investments (shares)

Current assets
Inventories
Stock properties
Assets held for sale
Trade and other receivables
Cash and cash equivalents

Total assets

EQUITY AND LIABILITIES
Capital and reserves
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Attributable to equity holders of the parent
Non-controlling interest
Total equity
Non-current liabilities
Long-term borrowings
Derivative financial liability
Deferred tax liabilities
Obligations under finance leases

Current liabilities
Trade and other payables
Short-term borrowings
Liabilities held for sale
Current tax payable

Total liabilities
Total equity and liabilities

31 December
2015
£’000

31 December
2014
£’000

Notes

15
16
27
19

24
25
25

26
29
27
32

28
26

145
176,133
—
736
177,014

60
991
—
4,553
4,387
9,991
187,005

4,437
5,491
604
65,485
76,017
80
76,097

591
22,912
100
6,640
30,243

10,663
69,637
—
365
80,665
110,908
187,005

185
173,412
1,215
1,179
175,991

—
991
535
4,433
5,335
11,294
187,285

4,372
4,692
604
61,804
71,472
82
71,554

71,058
24,475
—
7,038
102,571

11,681
1,140
228
111
13,160
115,731
187,285

The accounts were approved by the Board of Directors and authorised for issue on 27 April 2016. They were signed
on its behalf by:

A.S. Perloff
Chairman

Panther Securities P.L.C.

Consolidated Statement of Changes in Equity
For the year ended 31 December 2015

Balance at 1 January 2014

Total comprehensive income

Dividends

Share
capital
£’000

4,297

—

Capital
premium redemption
£’000

£’000

Retained
earnings
£’000

Total
£’000

3,750

604

59,225

67,876

—

942

—

4,650

(2,071)

(1,054)

Balance at 1 January 2015

4,372

4,692

604

61,804

71,472

Total comprehensive income

Dividends

—

799

—

6,852

(3,171)

(2,307)

Balance at 31 December 2015

4,437

5,491

604

65,485

76,017

Within retained earnings are unrealised losses of £97,000 and deferred tax credit of £17,000 (2014 – unrealised
losses of £2,574,000 and a deferred tax credit of £512,000) relating to fair value of available for sale investments
(shares).

Panther Securities P.L.C.

Consolidated Statement of Cash Flows
For the year ended 31 December 2015

Cash flows from operating activities

Profit from operating activities

Add: Depreciation charges for the year

Add: Loss on impairment of stock properties

Rent paid treated as interest

Profit before working capital change

Increase in inventory

Increase in receivables

(Decrease)/increase in payables

Cash generated from operations

Interest paid

Income tax paid

Net cash generated from operating activities

Cash flows from investing activities

Purchase of plant and equipment

Purchase of investment properties

Purchase of available for sale investments (shares)

Proceeds from sale of investment property

Proceeds from sale of available for sale investments (shares)

Proceeds from sale of fixed assets

Dividend income received

Interest income received

31 December
2015
£’000

31 December
2014
£’000
Restated

7,373

135

—

(520)

6,988

292

(1,139)

6,146

(4,572)

(95)

1,479

(38)

(2,224)

—

4,019

244

—

6,373

116

259

(544)

6,204

439

2,517

9,239

(4,457)

(188)

4,594

(89)

(3,171)

(63)

1,193

—

Net cash generated from/(used in) investing activities

2,032

(2,080)

Cash flows from financing activities

Repayments of loans

Draw down of loan

Dividends paid

Net cash used in financing activities

Net (decrease)/increase in cash and cash equivalents

Cash and cash equivalents at the beginning of year

Cash and cash equivalents at the end of year*

(3,152)

1,000

(2,307)

(4,459)

(948)

5,335

4,387

(1,180)

1,197

(1,054)

(1,037)

1,477

3,858

5,335

* Of this balance £1,110,000 (2014: £247,000) is restricted by the Group’s lenders i.e. it can only be used for purchase of

investment property.

Panther Securities P.L.C.

Notes to the Consolidated Accounts
For the year ended 31 December 2015

General information
Panther Securities P.L.C. (the Company) is a Public Limited Company incorporated in England and Wales.
The addresses of its Registered Office and principal place of business are disclosed in the introduction to the
Annual Report. The principal activities of the Company and its subsidiaries (the Group) are described in the
Directors’ Report.

New and revised International Financial Reporting Standards
Standards, interpretations and amendments to published standards that are not yet effective
Certain new standards, amendments and interpretations to existing standards have been published that are
mandatory for the Group’s accounting periods beginning on or after 1 January 2016 or later periods and have
not been early adopted. It is anticipated that these new standards, interpretations and amendments currently
in issue at the time of preparing the financial statements (April 2016) will have a material effect on the
consolidated financial statements of the Group, however the extent of this has not yet been assessed.

IFRS 9 Financial Instruments*

IFRS 15 Revenue for Contracts with Customers*

IFRS 16 Leases*

Amendments to IAS 1 Presentation of Financial Statements

Amendments to IAS 7 Statement of Cash Flows: Disclosure*

Amendments to IAS 27 Separate Financial Statements

* Not yet endorsed by the EU

The Parent Company and subsidiaries have not adopted IFRS in their individual accounts.

Critical accounting judgements and key sources of estimation uncertainty
Estimation uncertainty
Sources of estimation uncertainty are noted in the accounting policies for Investment Properties and fair value
of Derivative Financial Instruments.

Significant accounting policies
The consolidated financial statements have been prepared in accordance with International Financial Reporting
Standards adopted for use in the European Union. The financial statements have been prepared on the
historical cost basis, except for the revaluation of Investment Properties, Derivative Financial Instruments and
Available for Sale Investments which are carried at fair value.

The preparation of the financial statements requires management to make estimates and assumptions that
affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent
liabilities at the date of the financial statements. If in the future such estimates and assumptions which are
based on management’s best judgement at the date of the financial statements, deviate from the actual
circumstances, the original estimates and assumptions will be modified as appropriate in the year in which the
circumstances change. Where necessary, the comparatives have been reclassified or extended from the
previously reported results to take into account presentational changes. The principal accounting policies are
set out below.

Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities
controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern
the financial and operating policies of an entity so as to obtain benefits from its activities.

The results of subsidiaries disposed of are included in the consolidated income statement to the effective date
of disposal, and those acquired from the date on which control is transferred to the Group.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

Significant accounting policies continued
Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies into line with those used by other members of the Group. All intra-Group transactions, balances,
income and expenses are eliminated on consolidation.

Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Group’s
equity therein. Non-controlling interests consist of the amount of those interests at the date of the original
business combination and the non-controlling share of changes in equity since the date of the combination.
Profits applicable to the non-controlling interest in the subsidiary’s equity are allocated against the interests of
the Group.

Assets and businesses held for sale
Assets and businesses classified as held for sale are measured at the lower of carrying amount and fair value
less costs to sell. Impairment losses on initial classification as held for sale and gains or losses on subsequent
re-measurements are included in the income statement. No depreciation is charged on assets and businesses
classified as held for sale. Assets and businesses are classified as held for sale if their carrying amount will be
recovered or settled principally through a sale transaction rather than through continuing use.

The asset or business must be available for immediate sale and the sale must be highly probable within one
year. MRG Systems Limited (“MRG”) was classified as held for sale as at 31 December 2014.

MRG was reclassified back to continuing operations in the year, prior to this a full marketing process was
undertaken with a view to the sale of this business however the board were unable to find a suitable purchaser.
The sales process was not believed to be assisting the business as the uncertainty may have been affecting
customer confidence. The Board instructed the business agents to cease marketing activities. It is impossible
to gauge the effect, if any, the sales process had on the financial performance of MRG as on average two thirds
of MRG’s revenue is generated from non-recurring income.

The reclassification of MRG as no longer held for sale, in 2015, compared to held for sale in 2014, has resulted
in a restatement of the consolidated income statement, the consolidated statement of comprehensive income,
the consolidated statement of cash flows and related notes.

Investment Properties
Investment properties, which are properties held to earn rentals and/or capital appreciation, are revalued
annually by the Directors using the fair value model of accounting for Investment Property at the statement of
financial position date. When the Directors revalue the properties they make judgements based on the
covenant strength of tenants, remainder of lease term of tenancy, location, and other developments which have
taken place in the form of open market lettings, rent reviews, lease renewals and planning consents. Gains or
losses arising from changes in the fair value of investment property are included in the income statement in
the period in which they arise. However in the current year, the properties were valued by the independent
experts GL Hearn using similar procedures and methodology.

In accordance with IAS 17 (‘Leases’) and IAS 40 (‘Investment Property’), a property interest held under an
operating lease, which meets the definition of an investment property, is classified as an investment property.
The property interest is initially accounted for as if it were a finance lease, recognising as an asset and a liability
the present value of the minimum lease payments due by the Group to the freeholder. Subsequently, and as
described above, the fair value model of accounting for investment property is applied to these interests. A
corresponding interest charge is applied to the finance lease liabilities based on the effective interest rate. Fair
value measurement of investment property is classified as Level 3 in the fair value hierarchy. Using the fair
value model in IAS 40 is a recurring measurement.

Transfers between investment property and stock properties
Transfers from stock properties to investment property are made at fair value; any difference between the fair
value of the property at the date of transfer and its carrying amount is recognised in profit or loss. For a transfer
from investment property carried at fair value to inventories, the property’s deemed cost for subsequent
accounting in accordance with IAS 2 (‘Inventories’) is its fair value at the date of change in use.

Panther Securities P.L.C.

Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax. The tax currently payable
is based on taxable profit or loss for the period. Taxable profit or loss differs from profit or loss as reported in
the income statement because it excludes items of income or expense that are taxable or deductible in other
years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is
calculated using tax rates that have been enacted or substantively enacted by the statement of financial
position date.

Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for
using the statement of financial position liability method. Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that
taxable profits will be available against which deductible temporary differences can be utilised. Such assets
and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition
(other than in a business combination) of other assets and liabilities in a transaction that affects neither the
taxable profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries
and associates, and interests in joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each statement of financial position date and reduced
to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of
the asset to be recovered. Deferred tax is calculated at the tax rates that have been substantively enacted on
or before the statement of financial position date. Deferred tax is charged or credited to the income statement,
except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt
with in equity.

Current tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to income taxes levied by the same taxation authority and
the Group intends to settle its current assets and liabilities on net basis.

Corporation tax for the period is charged at 20.25% (2014 – 21.50%), representing the best estimate of the
weighted average annual corporation tax rate expected for the full financial year.

Segment reporting
An operating segment is a component of an entity about which separate financial information is available that
is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in
assessing performance. MRG Systems Limited is classified as separate operating segment to the activities of
the rest of the Group, where MRG Systems Limited’s principal activity is that of electronic designers, engineers
and consultants. In the prior year the operations of MRG Systems Limited were classified as discontinuing due
to it being marketed for sale.

Retirement benefit costs
The Company operates a defined contribution pension scheme and any pension charge represents the
amounts payable by the Company to the fund in respect of the year.

Revenue recognition
Revenue comprises:

Rental income from tenancy occupied properties net of Value Added Tax where appropriate: The income
is recognised on an accruals basis.

Sale of stock properties: This is recognised on the date that exchange of contracts becomes
unconditional.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

Significant accounting policies continued
l

Revenue in respect of MRG Systems Limited is measured at the fair value of the consideration received
or receivable for goods supplied and services rendered, net of discounts and Value Added Tax. Revenue
from the sale of goods is recognised when the significant risks and rewards of ownership have transferred
to the buyer (usually on despatch of the goods); the amount of revenue can be measured reliably; it is
probable that the associated economic benefits will flow to the entity; and the costs incurred or to be
incurred in respect of the transactions can be measured reliably.

Foreign currency translation
Transactions in foreign currency are recorded at the rates of exchange prevailing on the dates of the
transactions. At each statement of financial position date, monetary assets and liabilities that are denominated
in foreign currencies are retranslated at the rates prevailing on the statement of financial position date. Any gains
or losses arising on translation are taken to the income statement.

Plant and equipment
Fixtures, fittings and motor vehicles are stated at cost less accumulated depreciation and any accumulated
impairment losses. Depreciation is provided at rates calculated to write off the cost of plant and equipment
less their residual value, over their expected useful lives. The rates used across the Group are as follows;

Fixtures and equipment
Motor vehicles

10% – 33%
20%

Straight line
Straight line

The gain or loss arising on the disposal or retirement of an item of plant and equipment is determined as the
difference between the sales proceeds and the carrying amount of the asset and is recognised in the income
statement.

Impairment of property, plant and equipment
At each statement of financial position date, the Group reviews the carrying amounts of its property, plant and
equipment to determine whether there is any indication that those assets have suffered an impairment loss. If
any such indication exists the recoverable amount of the asset is estimated in order to determine the extent
of the impairment loss. Where it is not possible to estimate the recoverable amount of an individual asset, the
Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. If the recoverable amount of
an asset is estimated to be less than the carrying amount of the asset is reduced to its recoverable amount.
An impairment loss is recognised immediately in the income statement, unless the relevant asset is carried at
a revalued amount, in which case the impairment loss up to value of previous revaluation is treated as a
revaluation decrease.

Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, so that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment loss been recognised for the asset in prior years.
A reversal of an impairment loss is recognised immediately in the income statement, unless the relevant asset
is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation
increase.

Leasing
All leases are operating leases.

The Group as lessor
Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease.
Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount
of the leased asset and recognised on a straight line basis over the lease term.

Panther Securities P.L.C.

The Group as lessee
Rentals payable under operating leases are charged to profit or loss on a straight line basis over the term of
the relevant lease. Benefits received and receivable as an incentive to enter into an operating lease are also
spread on a straight line basis over the lease term.

The accounting policy for investment properties describes the Group’s statement of financial position for
investment properties held under an operating lease.

Financial instruments
Financial assets and financial liabilities are recognised on the Group’s statement of financial position when the
Group becomes a party to the contractual provisions of the instrument.

Trade receivables
Trade receivables are initially recognised at fair value, and are subsequently measured at amortised cost using
the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised
in the income statement when there is objective evidence that the asset is impaired. The allowance recognised
is measured as the difference between the asset’s carrying amount and the present value of estimated future
cash flows discounted at the effective interest rate computed at initial recognition.

Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits.

Financial liabilities and equity
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the
contractual arrangements entered into and the definitions of a financial liability and an equity instrument. An
equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting
all of its liabilities. The accounting policies adopted for specific financial liabilities and equity instruments are set
out below.

Trade payables
Trade payables are initially measured at fair value, and are subsequently measured at amortised cost, using
the effective interest rate method.

Bank borrowings
Interest bearing bank loans and overdrafts are initially measured at fair value less any transaction fees such as
loan arrangement fees, and are subsequently measured at amortised cost, using the effective interest rate
method. Any difference between the proceeds and the settlement or redemption of borrowings is recognised
over the term of the borrowings.

Derivative financial instruments
Certain financial instruments are entered into by the Directors on behalf of the Group to hedge against interest
rate fluctuations. These include interest rate swaps, options, collar and caps. The Group does not hold or
issue derivatives for trading purposes. Such derivative financial instruments are initially recognised at fair value
on the date at which a derivative contract is entered into and are subsequently remeasured at fair value at each
reporting date.

The Directors estimate the fair value annually for these financial instruments using the year end yield curve to
extract the markets estimate of future pricing for interest rates, this valuation is then considered alongside two
valuations obtained from different banks (one being HSBC bank – the counterparty to these agreements) in
deciding the most appropriate value. This is an estimation and as such there is uncertainty to the fair value
shown within the accounts.

For derivatives that do not qualify for hedge accounting, any gains or losses arising from changes in fair value
are taken directly to the income statement for the year. None of the Group’s derivative financial instruments
qualify for hedge accounting.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

Significant accounting policies continued
Available for sale investments
Under IAS 39, these investments are carried at fair value and classified in the statement of financial position
as available for sale investments (shares). Fair values of these investments are based on quoted market prices
where available. The fair value of the available for sale investments in unquoted equity securities cannot be
measured reliably and they have therefore been measured at cost. Movements in fair value are taken directly
to equity. When these investments are considered impaired in accordance with the requirements of IAS 39,
the impairment losses are recognised in the income statement. On realisation of the available for sale
investments, the cumulative gain or loss previously recognised through equity is reclassified from reserves to
the income statement.

The Group has not designated any financial assets that are not classified as held for trading as financial assets
at fair value through the income statement. The available for sale investments represent investments in listed
and unquoted equity securities that offer the Group the opportunity for return through dividend income and
fair value gains. They have no fixed maturity or coupon rate. Those shares that are expected to be held for the
long term are shown as non-current assets and those that are held for short term are shown as current assets.

Impairment of available for sale investments
At each Statement of Financial Position date the Group reviews any decline in the fair value of available for sale
investments to determine whether there is any objective evidence that those assets are impaired. If the asset
is judged to be impaired the cumulative loss that had been recognised in other comprehensive income is
reclassified from equity to the Income Statement being the difference between the acquisition cost and the
current fair value, less any impairment loss for that financial asset previously recognised in the Income
Statement.

Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event, and it is probable
that the Group will be required to settle that obligation. Provisions are measured at the Directors’ best estimate
of the expenditure required to settle the obligation at the statement of financial position date, and are
discounted to present value where the effect is material.

Stock properties
Properties that are purchased for future sale are classified as stock properties. Stock properties are valued at
the lower of cost and net realisable value. Cost comprises the cost of the property, and those overheads that
have been incurred in bringing the stock properties to their present condition. Net realisable value represents
the estimated selling price less all estimated costs to be incurred in marketing, selling and distribution.

Inventories
Stock and work in progress has been valued at the lower of cost and net realisable value, after making due
allowance for obsolete and slow moving items.

Share capital
Share capital represents the nominal value of shares issued by the company.

Share premium
Share premium represents amounts received in excess of nominal value on the issue of share capital.

Capital redemption reserve
The capital redemption reserve arises on the purchase of the companies own shares for cancellation.

Retained earnings
Retained earnings represent the accumulated comprehensive income and losses of the Group less dividends
paid.

Panther Securities P.L.C.

Dividends
Dividends are recognised based on the value per share declared. Where scrip dividends are issued, the value
of such shares, measured as the amount of the cash dividend alternative, is credited to share capital and
share premium. The net movement in equity represents the cash paid on the dividend.

Revenue and cost of sales
The Group’s main operating segment is investment and dealing in property and securities. The majority of the
revenue, cost of sales and profit or loss before taxation being generated in the United Kingdom. The Group is
not reliant on any key customers.

M.R.G. Systems Limited is an operating segment whose principal activity is that of electronic designers,
engineers and consultants. 66% of its revenues arose in the United Kingdom and 100% of its cost of sales.

The split of assets, tax effect and cash flow of each segment is not shown as these are not material in relation
to M.R.G. Systems Limited.

Turnover arose as follows:

Rental income

Income from trading (M.R.G. Systems Limited)

Cost of sales arose as follows:

Cost of sales from rental income

Cost of sales from trading (M.R.G. Systems Limited)

Profit/(loss) before income tax:

Profit from investment and dealing in properties

(Loss)/profit from trading (M.R.G. Systems Limited)

2015
£’000

12,840

1,603

14,443

2015
£’000

3,272

552

3,824

2015
£’000

8,482

(10)

8,472

2014
£’000

12,512

2,320

14,832

2014
£’000

4,000

1,044

5,044

2014
£’000

4,210

167

4,377

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

Profit for the year

The profit for the year is stated after charging:

Depreciation of tangible fixed assets – owned by the Group

Fees payable to the Group’s auditor for the audit of both the
parent company and the Group’s annual report and accounts

Fees paid to the Group’s auditor for other services:

The audit of the parent’s subsidiaries

Other services provided

Staff costs

Staff costs, including Directors’ remuneration, were as follows:

Wages and salaries

Social security costs

Pension contributions

The average monthly number of employees, including Directors,
during the year was as follows:

Directors

Other employees

Directors remuneration

Emoluments for services as Directors

2015
£’000

135

2015
£’000

1,468

156

1,676

2015
£’000

290

2014
£’000
Restated

116

2014
£’000
Restated

1,543

159

1,744

2014
£’000

288

There are no Directors with retirement benefits accruing under money purchase pension schemes in respect
of qualifying services. Please refer to the Directors’ Report for information on the highest paid Director and in
respect of individual Directors emoluments.

Key management are those persons having authority and responsibility for planning, directing and controlling
the activities of the Group. In the opinion of the Board, the Group’s key management comprises the Executive
and Non-Executive Directors of Panther Securities PLC. Information regarding their emoluments is set out
above.

Panther Securities P.L.C.

The following disclosures are in respect of employee benefits payable to the Directors of Panther Securities
PLC across the Group and are thus stated in accordance with IFRS:

Short term employee benefits (salaries and benefits)

Investment income

Interest on bank deposits

Dividends from equity investments

10. Finance costs

Interest payable on bank overdrafts and loans

Interest payable on finance lease liabilities*

2015
£’000

310

2015
£’000

4,666

520

5,186

2014
£’000

295

2014
£’000
Restated

4,724

544

5,268

* Investment properties held under operating leases have been treated as being held under finance leases in

accordance with IAS 40.

11.

Income tax charge
The charge for taxation comprises the following:

Current year UK corporation tax

Prior year UK corporation tax

Current year deferred tax expense/(credit)

Income tax expense/(credit) for the year

2015
£’000

441

(91)

350

1,307

1,657

2014
£’000

260

(80)

180

(495)

(315)

Domestic income tax is calculated at 20.25% (2014 – 21.50%) of the estimated assessable profit or loss for
the year. The future provision for deferred tax has been calculated on the basis of 18.0% (2014 – 20.0%).

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

11.

Income tax charge continued
The total charge for the year can be reconciled to the accounting profit or loss as follows;

Profit before taxation

Profit on ordinary activities before tax multiplied

by the average of the standard rate of UK
corporation tax of 20.25% (2014 – 21.50%)

Tax effect of expenses that are not deductible

in determining taxable profit

Dividend income not allowable for tax purposes

Capital allowances for the year in excess

of depreciation

Non taxable movement in fair value of

investment properties

Non deductible movement in fair value of
available for sale investments (shares)

Non deductible movement in fair value of

financial instruments

Disposal of properties or shares

Prior year corporation tax over provision

Tax charge/(credit)

2015
£’000

8,472

2015
%

1,716

20.25

(5)

(34)

0.4

(0.1)

(0.4)

2014
£’000

4,210

905

115

(2)

(59)

2014
%

21.5

2.8

—

(1.4)

(740)

(8.7)

(1,361)

(32.3)

—

454

323

(91)

1,657

—

5.4

3.8

(1.1)

148

(80)

(315)

12. Profit or loss attributable to members of the parent undertaking

Dealt with in the accounts of:

– the parent undertaking

– subsidiary undertakings

A reconciliation of Parent Company profit or loss is provided in note 30.

13. Dividends

Amounts recognised as distributions to equity holders in the period:

Final dividend for the year ended 31 December 2014 of 9p

per share (2013: 9p per share)

Interim dividend for the year ended 31 December 2015 of 9p

per share (2014: 3p per share)

2015
£’000

(5,158)

11,971

6,813

2015
£’000

1,574

1,597

3,171

Panther Securities P.L.C.

—

3.5

0.4

(1.9)

2014
£’000

(16,004)

20,696

4,692

2014
£’000

1,546

525

2,071

The Directors recommend a payment of a final dividend, for the year ended 31 December 2015 of 3p per
share (2014 – 9p), following the interim dividend paid on 27 November 2015 of 9p per share. The final dividend
of 3p per share will be payable on 5 September 2016 to shareholders on the register at the close of business
on 19 August 2016 (Ex dividend on 18 August 2016).

Further to the above ordinary dividends a special dividend of 10p per share was paid on 31 March 2016. The
special dividend was in relation to the year ended 31 December 2015.

The full ordinary dividend for the year ended 31 December 2015 is anticipated to be 12p per share, plus 10p
per share special dividend, being a total of 22p per share.

14. Earnings per ordinary share (basic and diluted)

The calculation of profit per ordinary share is based on profit, after excluding non-controlling interests, being
a profit of £6,815,000 (2014 – £4,650,000) and on 17,617,112 ordinary shares being the weighted average
number of ordinary shares in issue during the year (2014 – 17,336,791). There are no potential ordinary shares
in existence.

15. Plant and equipment

Cost

At 1 January 2014

Transfer to assets classified as held for sale

Additions

Disposals

At 1 January 2015

Additions

Transfer from assets classified as held for sale

At 31 December 2015

Accumulated depreciation

At 1 January 2014

Transfer to assets classified as held for sale

Depreciation charge for the year

Disposals

At 1 January 2015

Depreciation charge for the year

Transfer from assets classified as held for sale

At 31 December 2015

Carrying amount

At 31 December 2015

At 31 December 2014

At 1 January 2014

Fixtures and
Equipment
£’000

1,007

(256)

(191)

650

199

887

627

(111)

(145)

465

135

142

742

145

185

380

Motor
Vehicles
£’000

—

(22)

—

(17)

—

Total
£’000

1,037

(256)

(213)

658

199

895

651

(111)

(162)

473

135

142

750

145

185

386

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

16.

Investment property

Fair value

At 1 January 2014

Additions

Disposals

Transferred from stock properties

Fair value adjustment on property held on operating leases

Revaluation increase

At 1 January 2015

Additions

Disposals

Fair value adjustment on property held on operating leases

Revaluation increase

At 31 December 2015

Carrying amount

At 31 December 2015

At 31 December 2014

Investment
Properties
£’000

158,184

3,171

(1,250)

200

(3)

13,110

173,412

2,224

(2,945)

(417)

3,859

176,133

173,412

At 31 December 2015, £136,689,000 (2014 – £133,740,000) and £39,444,000 (2014 – £39,672,000) included
within investment properties relates to freehold and leasehold properties respectively.

On the historical cost basis, investment properties would have been included as follows:

Cost of investment properties

2015
£’000

115,998

2014
£’000

118,243

The Group has pledged £164,331,000 of investment property (2014 – £158,823,000) as security for the loan
facilities granted to the Group at the balance sheet date.

Costs relating to ongoing and potential developments are included in additions to investment properties and
in the year ended 31 December 2015 amounted to £180,000 (2014 – £64,000).

The property rental income earned by the Group from its investment property, all of which is leased out under
operating leases, amounted to £12,593,000 (2014 – £12,279,000).

Panther Securities P.L.C.

Property valuations are complex, require a degree of judgement and are based on data some of which is
publicly available and some that is not. Consistent with EPRA guidance, we have classified the valuations of
our property portfolio as level 3 as defined by IFRS 13 Fair Value Measurement. Level 3 means that the
valuation model cannot rely on inputs that are directly available from an active market; however there are
related inputs from auction results that can be used as a basis. These inputs are analysed by segment in
relation to the property portfolio. All other factors remaining constant, an increase in rental income would
increase valuation, whilst an increase in equivalent nominal yield would result in a fall in value and vice versa.

In establishing fair value the most significant unobservable input is considered to be the appropriate yield to
apply to the rental income. This is based on a number of factors including financial covenant strength of the
tenant, location, marketability of the unit if it were to become vacant, quality of property and potential alternative
uses.

Yields applied across the core portfolio are in the range of 6.5% – 11.0% with the average yield being 8.0%.
Assuming all else stayed the same; a decrease of 1.0% in the average yield would result in an increase in fair
value of £22,488,000. An increase of 1.0% in the average yield would result in a corresponding decrease in
fair value.

The property valuations were carried out independently by GL Hearn at 31 December 2015 (and at
31 December 2014). The property valuations when carried out internally are undertaken by Directors, two of
whom are members of the Royal Institution of Chartered Surveyors (RICS). The valuation methodology by
both parties was in accordance with The RICS Appraisal and Valuation Standards (9th Edition – January 2014),
which is consistent with the required IFRS 13 methodology. IFRS 13 defines fair value as the price that would
be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants
at the measurement date.

For some properties, valuation was based on an end development rather than investment income in order to
achieve highest and best use value. To get the valuation in this instance the end development is discounted
by profit for a developer and cost to build to get to the base estimated market value of investment.

The amount of unrealised gains or losses on investment properties is charged to the income statement as the
movement in fair value of investment properties, for 2015 this was a fair value gain of £3,859,000 (2014 – fair
value gain of £13,110,000). The amount of realised gains or losses is shown as the profit/(loss) on disposal of
investment properties within the income statement, for 2015 there was a realised gain of £1,074,000 (2014 –
loss of £57,000).

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

17. Subsidiaries

Details of the Company’s subsidiaries at 31 December 2015 are as follows;

Name of subsidiary

Country of
incorporation
and operation

Activity

Proportion of Proportion
of voting
power held
%

ownership
interest
%

Panther Trading Limited

Great Britain

Property

Panther (Dover) Limited (*)

Great Britain

Property

Panther Developments Limited

Great Britain

Property

Panther Shop Investments Limited

Great Britain

Property

Panther Shop Investments (Midlands) Limited Great Britain

Property

Panther Investment Properties Limited

Great Britain

Property

Panther (Bromley) Limited (***)

Great Britain

Property

Snowbest Limited

Great Britain

Property

Surrey Motors Limited (****)

Great Britain

Property

Westmead Building Company Limited (*)

Great Britain

Property

Multitrust Property Investments Limited

Great Britain

Property

Etonbrook Properties PLC

Great Britain

Non-trading

Northstar Property Investment Limited

Great Britain

Property

Panther (VAT) Properties Limited

Great Britain

Property

Northstar Land Limited

Great Britain

Property

London Property Company PLC

Great Britain

Dormant

Eurocity Properties PLC

Great Britain

Property

Eurocity Properties (Central) Limited (**)

Great Britain

Property

CJV Properties Limited (**)

Great Britain

Property

MRG Systems Limited

Panther AL Limited

Great Britain

Trading

Great Britain

Property

Panther AL (VAT) Limited

Great Britain

Property

Melodybright Limited

Great Britain

Property

TRS Developments Limited

Great Britain

Property

Abbey Mills Properties Limited

Great Britain

Property

100

* – 100% subsidiaries of Panther Shop Investment (Midlands) Limited
** – 100% subsidiaries of Eurocity Properties PLC
*** – 100% subsidiary of Surrey Motors Limited
**** – 95% owned by Panther Securities PLC/5% owned by Panther (Bromley) Limited

All companies have a 31 December year end and have been included in the consolidated financial statements.

Panther Securities P.L.C.

18.

Investment in associate undertaking
The Group purchased a 25% interest, being 150,000 ordinary shares of £1 each (newly issued share capital
for cash) in Wimbledon Studios Limited for £150,000 in August 2010.

On 5 August 2014, the directors of Wimbledon Studios Limited appointed KPMG LLP as administrators when
the Group would no longer fund this loss making business.

In 2014 the Group paid £75,000 to purchase fixtures that belonged to Wimbledon Studios Limited from the
administrators as they were within the building owned by the Group and assisted with the subsequent letting
of the building.

The administration did not lead to the repayment of these debts, accordingly all debts have been written off.

Group transactions with associate:

Rent receivable from associate recognised in year

Trade receivables and accrued income

Trade receivables and accrued income – overdue

Provision

Other receivables – overdraft facility drawn

Provision on overdraft

19. Available for sale investments (shares)

2015
£’000

—

Cost or valuation

At 1 January 2014

Reversal of impairment on revaluation through income statement

Additions

At 1 January 2015

Movement in fair value of available for sale investments (shares) taken to equity

Disposal

At 31 December 2015

Comprising at 31 December 2015:

At cost

At valuation/net realisable value

Carrying amount

At 31 December 2015

At 31 December 2014

2014
£’000

368

1,200

(1,200)

622

(622)

Non-current
assets
£’000

1,083

1,179

(488)

736

542

194

736

1,179

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

19. Available for sale investments (shares) continued

The available for sale investments represent investments in listed and unquoted equity securities that offer the
Group the opportunity for return through dividend income and fair value gains. They have no fixed maturity or
coupon rate. The fair values of the listed securities are based on quoted market prices. The available for sale
securities carried at fair value are classified as level 1 in the fair value hierarchy specified in IFRS 13. The fair
value of available for sale investments in unquoted equity securities, which are not publically traded, cannot
be measured and have therefore been shown at cost. The valuation of the available for sale investments is
sensitive to stock exchange conditions.

Andrew Perloff and Simon Peters are directors of English Rose Enterprises Limited. The Group sold its holding
in Beale Ltd (previously Beale PLC) to English Rose Enterprises Limited for 6p a share in February 2015. The
offer had been made to all shareholders in Beale Ltd and accepted by over 75% of them. This disposal
crystallised a further £244,000 loss, but also realised £244,000 of cash.

Price risk
For the year ended 31 December 2015 if the average share price of the portfolio was 10% lower then the gain
recognised in other comprehensive income would have been £19,000 lower. Corresponding gains would be
seen for a 10% uplift.

20. Stock properties

Stock properties

2015
£’000

991

2014
£’000

991

The cost of stock properties recognised as expense and included in cost of sales amounted to £nil (2014 –
£nil). Impairments of £nil have been recognised against stock properties (2014 – £259,000).

The market value of stock properties is £1,910,000 (2014 – £2,021,000).

£1,810,000 of stock properties at market value have been provided as security for the bank loan from HSBC
and Santander referred to in note 26.

The market value shown as at 31 December 2015 was valued independently by GL Hearn. The stock
properties are held at the lower of cost and market value and as such any uplift is not recognised in the financial
statements.

21. Capital commitments

Capital expenditure that has been contracted for but has not been

provided for in the accounts

The above relates to building works.

2015
£’000

105

2014
£’000

125

Panther Securities P.L.C.

22. Trade and other receivables

Trade receivables

Bad debt provision

Other receivables

Prepayments and accrued income

2015
£’000

3,787

(985)

2,802

1,723

4,553

2014
£’000

4,588

(2,368)

2,220

2,204

4,433

The Directors consider that the carrying amount of trade and other receivables approximates their fair value.
Net trade receivables are financial assets. The total of financial assets included within the financial statements
at amortised cost is £7,217,000 (2014 – £7,564,000) (which relates to £2,830,000 (2014 – £2,229,000)
included in the above and the Group’s cash or cash equivalents).

Debts are specifically provided once recovery becomes doubtful. The bad debt provision includes all material
doubtful debts that the directors are aware of.

Movement in allowance for doubtful debts on trade receivables and cash and cash equivalents:

Balance at 1 January 2014

Amount written off as uncollectable

Charge/(credit) to income statement

Balance at 1 January 2015

Amounts written off as uncollectable

Charge to income statement

Balances at 31 December 2015

Trade
receivables
£’000

Accrued
income
£’000

Cash and
cash
equivalents
£’000

Total
bad debt
provisions
£’000

2,470

(1,178)

1,076

2,368

(1,774)

391

985

—

(595)

595

—

(4)

—

2,532

(1,178)

1,072

2,426

(2,369)

986

1,043

The cash and cash equivalents balances provided against related to balances on account with Kaupthing
Singer and Friedlander before they went into administration. The Group at the statement of financial position
date had received 82.5p in the pound from an original balance of £332,000.

23. Other financial assets

Cash and cash equivalents
Cash and cash equivalents comprise of cash held by the Group and short-term bank deposits. The carrying
amount of these assets approximates their fair value.

Credit risk
The Group’s financial assets are cash and cash equivalents and trade and other receivables.

The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned
by international credit-rating agencies. Kaupthing Singer and Friedlander went into administration and all of its
balances are provided against (see above). Further information on the Group’s credit risk is detailed within the
Group Strategic Report.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

24. Share capital

Allotted, called up and fully paid

17,746,929 (2014 – 17,487,295) ordinary shares of £0.25 each

2015
£’000

4,437

2014
£’000

4,372

The Company has one class of ordinary shares which carry no fixed right to income.

During 2015 259,634 (2014: 301,008) ordinary shares were issued in the period as a consequence of the
scrip dividend.

25. Capital reserves

Share premium account

At 31 December

Capital redemption reserve

At 31 December

26. Bank loans

Bank loans due within one year

(within current liabilities)

2015
£’000

5,491

604

2015
£’000

69,637

2014
£’000

4,692

604

2014
£’000

1,140

Bank loans due within more than one year

591

71,058

(within non-current liabilities)

Total bank loans

Analysis of debt maturity

Trade and other payables**:

Bank loans repayable

70,228

72,198

2015
£’000
Interest*

—

2015
£’000
Capital

5,676

2015
£’000
Total

5,676

2014
£’000
Total

5,083

3,024

71,734

466

224

On demand or within one year

1,104

69,637

70,741

In the second year

In the third year to the fifth year

After five years

140

420

154

462

1,163

75,904

77,067

80,531

based on the year end 3 month LIBOR floating rate – 0.56%, and bank rate of 0.50%

Trade creditors, other creditors and accruals

In July 2011 the Group completed on a £75,000,000 facility, with HSBC and Santander, which they initially drew
down £60,000,000 the fixed term element. This loan was due for repayment in July 2016.

Panther Securities P.L.C.

On 19 April 2016 the Group renewed its £75,000,000 loan facility by entering into a new 5 year term loan with
HSBC and Santander. The Group has the option to draw down an additional £10,000,000 under the same
agreement subject to the banks credit approval process.

The Natwest bank loan was £731,000 at the year end and is repayable over its life to September 2022.

Bank loans are secured by fixed and floating charges over the assets of the Group.

The estimate of interest payable is based on current interest rates and as such, is subject to change.

The Directors estimate the fair value of the Group’s borrowings, by discounting their future cash flows at the
market rate (in relation to the prevailing market rate for a debt instrument with similar terms). The fair value of
bank loans is not considered to be materially different to the book value. Bank loans are financial liabilities.

27. Deferred taxation

The following are the major deferred tax assets and liabilities recognised by the Group, and the movements
thereon, during the current and prior reporting periods.

Asset at 1 January 2014

Debit to profit and loss for the year

Asset at 1 January 2015

Credit to equity for the year

Credit to profit and loss for the year

Liability at 31 December 2015

Deferred taxation arises in relation to:

Deferred tax

Deferred tax liabilities:

Investment properties

Deferred tax assets:

Tax allowances in excess of book value

Available for sale investments (shares)

Derivative financial liability

Net deferred tax (liability)/asset

Total
£’000

720

495

1,215

(8)

(1,307)

(100)

2014
£’000

2015
£’000

(4,588)

(4,647)

347

4,124

(100)

455

512

4,895

1,215

The aggregate amount of temporary differences associated with investments in subsidiaries, associates, and
interests in joint ventures, for which deferred tax liabilities may arise, have not been recognised.

As at 31 December 2015 the substantively enacted rate was 18% (2014: 20%) and this has been used for
the deferred tax calculation.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

28. Trade and other payables

Trade creditors

Social security and other taxes

Other creditors

Obligations under finance leases (see note 32)

Accruals and deferred income

2015
£’000

3,855

665

872

520

4,751

10,663

2014
£’000

3,285

1,132

850

544

5,870

11,681

Trade creditors and accruals comprise amounts outstanding for trade purchases and on-going costs.

The Directors consider that the carrying amount of trade payables approximates their fair value.

All trade and other payables are due within one year. Trade creditors and accruals are financial liabilities.

Liabilities included within the financial statements at amortised cost total £80,891,000 (2014 – £83,879,000)
(includes payables above and the long term and short term borrowings).

29. Derivative financial instruments

The main risks arising from the Group’s financial instruments are those related to interest rate movements.
Whilst there are no formal procedures for managing exposure to interest rate fluctuations, the Board continually
reviews the situation and makes decisions accordingly. Hence, the Company will, as far as possible, enter
into fixed interest rate swap arrangements. The purpose of such transactions is to manage the interest rate
risks arising from the Group’s operations and its sources of finance.

Bank loans
Interest is charged as to:

Fixed/Hedged

HSBC Bank plc*

HSBC Bank plc**

Unamortised loan
arrangement fees

Floating element

HSBC Bank plc

Natwest Bank plc

2015
£’000

35,000

25,000

—

9,497

731

70,228

2015
Rate

7.06%

6.63%

2014
Rate

7.06%

6.63%

2014
£’000

35,000

25,000

(182)

11,497

883

72,198

Bank loans totalling £60,000,000 (2014 – £60,000,000) are fixed using interest rate swaps removing the Group
exposure to fair value interest rate risk. Other borrowings are arranged at floating rates, thus exposing the
Group to cash flow interest rate risk.

Panther Securities P.L.C.

Financial instruments for Group and Company
The derivative financial assets and liabilities are designated as held for trading.

Derivative Financial Liability

Interest rate swap

Net fair value gain/(loss) on
derivative financial assets

Hedged
amount
£’000

35,000

25,000

Duration
of contract
remaining
‘years’

22.69

5.92

Average
rate

5.06%

4.63%

2015
Fair
value
£’000

2014
Fair
value
£’000

(18,541)

(19,282)

(4,371)

(5,193)

(22,912)

(24,475)

1,563

(9,813)

* Fixed rate came into effect on 1 September 2008. Rate includes 2% margin. The contract includes mutual

breaks, the first potential one was on 23 November 2014 (and every 5 years thereafter).

** This arrangement came into effect on 1 December 2011 when HSBC exercised an option to enter the Group
into this interest swap arrangement. The rate shown includes a 2% margin. This contract includes a mutual
break on the fifth anniversary and its duration is until 1 December 2021.

Interest rate derivatives are shown at fair value in the income statement, and are classified as level 2 in the fair
value hierarchy specified in IFRS 13.

The vast majority of the derivative financial liabilities are due in over one year and therefore they have been
disclosed as all due in over one year.

The above fair values are based on quotations from the Group’s banks and Directors’ valuation.

Interest rate risk
For the year ended 31 December 2015, if on average the 3 month LIBOR over the year had been 100 basis
points (1%) higher with all other variables held constant, under the financing structure in place at the year end,
profit before tax for the year would have been approximately £102,000 lower (2014: £124,000 lower). This
analysis excludes any affect this rate adjustment might have on expectations of future interest rates movements
which is likely to affect the estimation of the fair value of the derivative financial assets/liabilities (as this
movement would also be shown within the income statement affecting post-tax profit or loss), but indicates
the likely cash saving/(cost) a 100 basis points (1%) movement would have had for the Group.

Treasury management
The long-term funding of the Group is maintained by three main methods, all with their own benefits. The
Group has equity finance, has surplus profits and cash flow which can be utilised, and also has loan facilities
with financial institutions. The various available sources provide the Group with more flexibility in matching the
suitable type of financing to the business activity and ensure long-term capital requirements are satisfied.
Please also see the Financial Risk management: Objectives, policies and processes for managing risk, of the
Group Strategic Report.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

30. Parent company profit and loss account

As permitted under Section 408 of the Companies Act 2006, no income statement or statement of
comprehensive income is presented for the parent company.

Reconciliation of parent company profit and loss

Profit/(loss) of parent company before intercompany adjustments

Add: Reversal of/(increase in) write off of intercompany debt (removed

on consolidation)

Less: intercompany dividends (removed on consolidation)

Loss attributable to members of the Parent undertaking as per note 12

31. Contingent liabilities

There were no contingent liabilities at the year end.

2015
£’000

1,349

359

(6,866)

(5,158)

2014
£’000

(8,958)

(407)

(6,639)

(16,004)

32. Operating lease arrangements and obligations under finance leases

The Group as lessor
The Group rents out its investment properties under operating leases. Rental income for the Group is disclosed
in note 5. The Group paid rent under non-cancellable operating leases in the year of £779,000 (2014 –
£714,000).

The majority of these non-cancellable lease obligations are long leasehold investments in which the Group
receives a profit rent. These investments often have rents payable, often with a contingent element (for example
paying a proportion of collected rents), and a minimum rent obligation that is due to the superior landlord.

The average lease length is 78 years. The minimum rental payment obligations due under these operating
leases and anticipated rental income derived from these investments are shown below. The difference between
the rents payable in the year of £779,000 and the minimum for the year of £520,000 is related to the contingent
element only payable out of rents receivable.

Minimum future payments under non-cancellable operating leases
(Lessee)

Payable within one year

Payable between one year and five years

Payable in more than five years

2015
£’000

520

2,080

40,547

43,147

Anticipated rental income derived under non-cancellable operating leases
(Lessor)

Payable within one year

Payable between one year and five years

Payable in more than five years

Panther Securities P.L.C.

2015
£’000

3,002

12,008

228,820

243,830

2014
£’000

544

2,176

43,512

46,232

2014
£’000

3,112

12,448

240,758

256,318

Obligations under finance leases
Investment property held under an operating lease is initially accounted for as if it were a finance lease,
recognising as an asset and a liability the present value of the minimum lease payments due by the group to
the freeholder. Subsequently and as described in accounting policies, the fair value model of accounting for
investment property is applied to these interests.

Obligations under finance leases due within one year

(included within current liabilities)

Obligations under finance leases due within one to five years

Obligations under finance leases due in more than five years

(included within non-current liabilities)

Total obligations under finance leases

33. Events after the reporting date

2015
£’000

520

2,080

4,560

6,640

7,160

2014
£’000

544

1,837

5,201

7,038

7,582

In January 2016 the Group completed the sale on a conditional contract for the upper parts of Old Inn House,
Sutton for £3,900,000 (before costs).

In March 2016 the group disposed of a property in Southend for £1,050,000 (before costs).

In March 2016 the Group purchased Lord Street Properties (Southport) Ltd for £4,500,000 (including costs).

In March 2016, JE Beale PLC (a subsidiary of Beale Ltd) (“Beale”), entered and had approved a landlords only
Creditors Voluntary Arrangement (“CVA”), which affected two of Panther’s property investments. Beale have
the right to exit these stores in 10 months, and will pay a third of the rent in the meantime, the pre-CVA
combined rent being £350,000. This process however does put Beale into a stronger financial position, which
make rental streams on other investment properties owned by Panther, where Beale is a tenant, more secure.

On 19 April 2016 the Group renewed its £75,000,000 loan facility by entering into a new 5 year term loan with
HSBC and Santander. The Group has the option to draw down an additional £10,000,000 under the same
agreement subject to the banks credit approval process.

34. Related party transactions

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been
eliminated on consolidation and are not disclosed in this note.

The compensation of the Group’s key management personnel is shown in note 8 to the financial statements
and Directors’ emoluments are shown in note 8 and the Directors’ Report.

Note 18 details the Group’s transactions with its associate Wimbledon Studios Limited (in administration).

In 2014 a deal assistance fee of £250,000 was paid to Wenhedge Limited, a privately owned company of
Andrew Perloff. This private company had assisted Wimbledon Studios Limited in surviving for 5 additional
months which assisted the Group in getting the most optimum outcome. Under an agreement with Andrew
Perloff, the Group agreed to pay such a fee in the event that a beneficial outcome was achieved for the Group.
The independent directors felt this was good value for the service provided and the benefits of the letting can
clearly be seen in terms of valuation uplift and upfront rent received.

In 2014 a lease was entered into with Airsprung Group PLC a company 100% owned by Portnard Limited
(whose shareholding in the Group and relationship is detailed in the Directors’ Report). In 2015 Airsprung
exited this lease and the property was let at a higher rent to a third party.

Panther Securities P.L.C.

Notes to the Consolidated Accounts continued
For the year ended 31 December 2015

34. Related party transactions continued

In February 2015 Panther Securities PLC sold its entire holding in Beale Ltd (previously Beale PLC) to English
Rose Enterprises Limited, a company 100% owned by Portnard Limited. English Rose Enterprises Limited was
newly set up to make an offer for the entire shareholding of Beale Ltd. Portnard’s Directors include Andrew
Perloff and Simon Peters. This offer was made to the entire shareholder base of Beale Ltd, approved by Beale’s
independent Board and their advisors and accepted by over 75% of the shareholder base, as such the Panther
Securities PLC Board believes this is fair value. Further details are given in note 19.

Included within the financial statements is £780,000 (2014: £728,000) of rental income in respect of Beale Ltd,
a company which has some common directors to the Group. Of this balance £514,000 (2014: £211,000) is
outstanding and included within trade receivables. No provisions are required in respect of theses balances
as all are current or received by the end of January 2016.

Included within the revenue recognised to date from Beale Ltd is £660,000 (2014: £1,207,000) of accrued
income in respect of rent free periods. Of the 2014 balance £595,000 was written off in 2015 (2014: £nil), being
the amount of rent accrued in respect of stores compromised by Beale’s landlord only Creditors Voluntary
Arrangement.

At 31 December 2015 included within creditors is £96,300 (2014: £nil) payable to G Perloff a close family
member of a director.

35. Approval of financial statements

The financial statements were approved by the Board of Directors and authorised for issue on 27 April 2016.

Panther Securities P.L.C.

Parent Company Statement of Financial Position
Company number 293147

As at 31 December 2015

£’000

2015
£’000

£’000

2014
£’000
Restated

16,031

16,474

Notes

Fixed assets

Investments

Current assets

Debtors

Cash at bank and in hand

108,348

3,437

111,785

Creditors: amounts falling due within one year

(80,018)

Net current assets

Total assets less current liabilities

Creditors: amounts falling due after more

than one year

Derivative financial liability

Net assets

Capital and reserves

Called up Share Capital

Share Premium Account

Capital Redemption Reserve

Profit and Loss Account

Shareholders’ funds

31,767

47,798

—

(22,912)

24,886

4,437

5,491

604

14,354

24,886

111,056

4,448

115,504

(11,381)

104,123

120,597

(70,315)

(24,475)

25,807

4,372

4,692

604

16,139

25,807

The accounts were approved by the Board of Directors and authorised for issue on 27 April 2016. They were signed
on its behalf by:

A.S. Perloff
Chairman

Panther Securities P.L.C.

Parent Company Statement of Changes in Equity
As at 31 December 2015

Balance at 1 January 2014

Profit for the year

Dividends

Share
capital
£’000

4,297

—

942

Balance at 1 January 2015

4,372

4,692

Profit for the year

Movement in fair value of available for

sale investments (shares) taken to equity

Deferred tax relating to movement in fair

value of available for sale investments

(shares) taken to equity

Dividends

—

799

Capital
premium redemption
£’000

£’000

Retained
earnings
£’000

Total
£’000

3,750

604

25,216

33,867

—

604

—

(7,006)

(2,071)

(7,006)

(1,054)

16,139

25,807

1,349

(8)

(3,171)

(2,307)

Balance at 31 December 2015

4,437

5,491

604

14,354

24,886

Panther Securities P.L.C.

Notes to the Parent Company Accounts
For the year ended 31 December 2015

36. Accounting policies for the Parent Company

The Parent Company financial statements have been prepared in accordance with Financial Reporting
Standard 101 Reduced Disclosure Framework.

Basis of preparation of financial statements
The company transitioned to FRS 101 for all periods presented.

The accounting policies which follow set out those policies which apply in preparing the financial statements
for the year ended 31 December 2015.

The company has taken advantage of the following disclosure exemptions under FRS 101:

the exemption from providing certain comparative information;

the exemption from preparing a statement of cash flows;

the exemption from declaring compliance with IFRS;

the exemption from disclosing aspects of capital risk management;

the exemption from providing a reconciliation on the number of shares outstanding;

the exemption from disclosing information about IFRS in issue but not yet adopted;

the exemption from disclosing key management personnel compensation; and

the exemption from disclosing transactions between wholly owned group members.

In relation to the following exemptions equivalent disclosures have been given in the consolidated financial
statements:

the exemption from certain non-current assets held for sale and discontinued operations disclosures;

the exemption from certain financial instrument disclosures;

the exemption from certain fair value disclosures; and

the exemption from certain asset impairment disclosures.

Critical accounting judgements and key sources of estimation uncertainty
The preparation of
to make judgements, estimates and
assumptions that affect the amounts reported for assets and liabilities as at the balance sheet date and the
amounts reported for revenues and expenses during the year. However, the nature of estimation means that
actual outcomes could differ from those estimates.

financial statements requires management

Judgements and key sources of estimation uncertainty of the Group, applicable to the consolidated financial
statements have been disclosed in note 4 to the consolidated financial statements. There are no additional
judgements and key sources of estimation uncertainty that are applicable to the company only.

Significant accounting policies
The accounting policies of the Parent Company are identical to those adopted in the Consolidated Financial
Statements of the Group, where applicable, with the exception of revenue recognition and the addition of
impairments.

Revenue recognition
Turnover comprises dividend income from investments recognised when the Company’s rights to receive
payment have been established.

Investments
Investments in subsidiaries undertakings are stated at cost less any provisions for impairment.

Panther Securities P.L.C.

Notes to the Parent Company Accounts continued
For the year ended 31 December 2015

37. Fixed asset investments

Cost or valuation

At 1 January 2015

Movement in fair value of available for sale

investments (shares) taken to equity

Disposal

At 31 December 2015

Investments:

Listed

Unlisted

Shares in
Group
undertakings
£’000

Other
investments
£’000

Total
£’000

15,295

1,179

16,474

—

15,295

—

15,295

(488)

736

194

542

736

(488)

16,031

194

15,837

16,031

The above investments are shown at market value where there is an active market for these shares. The
historic cost of listed investments is £291,000 (2014: £3,211,000).

For details of the Company’s subsidiaries at 31 December 2015, see note 17.

For details of the Company’s disposal of shares in Beale Ltd (previously Beale PLC) see note 44.

38. Debtors

Due less than one year:

Trade debtors

Corporation tax

2015
£’000

2014
£’000

149

Amounts owed by Group undertakings

104,060

105,439

Other debtors

Prepayments and accrued income

Due more than one year:

Deferred tax (note 41)

4,140

108,348

5,407

111,056

Panther Securities P.L.C.

39. Creditors:

Amounts falling due within one year

Trade creditors

Amounts owed to Group undertakings

Bank loan

Social security and other taxes

Other creditors

Accruals and deferred income

40. Creditors:

Amounts falling due after more than one year

Bank loans

2015
£’000

188

9,712

69,497

461

2014
£’000

9,746

1,000

103

413

80,018

11,381

2015
£’000

—

2014
£’000

70,315

The bank loan is secured by first fixed charges on the properties held within the Group and floating charge over
all the assets of the Company. The lenders have also taken fixed security over the shares held in the group
undertakings.

41. Deferred taxation

The following potential deferred taxation asset is recognised:

Potential capital losses

Fair value of financial instruments

42. Called up share capital

Authorised

30,000,000 ordinary shares of £0.25 each

Allotted, called up and fully paid

17,746,929 (2014: 17,487,295) ordinary shares of £0.25 each

2015
£’000

4,124

4,140

2015
£’000

7,500

4,437

2014
£’000

512

4,895

5,407

2014
£’000

7,500

4,372

The Company has one class of ordinary shares which carry no right to fixed income.

During 2015 259,634 (2014: 301,008) ordinary shares were issued in the period as a consequence of the
scrip dividend.

Panther Securities P.L.C.

Notes to the Parent Company Accounts continued
For the year ended 31 December 2015

43. Other commitments

At 31 December 2015 the Company had total commitments under non-cancellable operating leases as
follows:

Expiry date:

Less than one year

44. Related party transactions

Land and buildings

2015
£’000

2014
£’000

The compensation of the Company’s key management personnel is shown in note 8 to the financial statements
and Directors’ emoluments are shown in note 8 and the Directors’ Report.

Note 18 details the Company’s transactions with its associate Wimbledon Studios Limited (in administration).

At 31 December 2015 included within other creditors is £96,300 (2014: £nil) payable to G Perloff a close family
member of a director.

There were no further related party transactions during the period other than dividends paid to directors who
hold ordinary shares in the Company.

45. Risk management

For information on the Company’s risk management please refer to the Group Strategic Report section of the
Group accounts.

46. Events are the reporting period date

In March 2016 the Company purchased Lord Street Properties (Southport) Ltd for £4,500,000 (including
costs).

On 19 April 2016 the Company renewed its £75,000,000 loan facility by entering into a new 5 year term loan
with HSBC and Santander. The Company has the option to draw down an additional £10,000,000 under the
same agreement subject to the banks credit approval process.

47. First time adoption of FRS 101 Reduced Disclosure Framework

Other than the adoption of the reduced disclosures there was no material effect of applying FRS 101 for the
first time. The disclosure exemptions adopted are included in note 36 to the financial statements.

Panther Securities P.L.C.

48. Restatement of prior period

A prior period adjustment has been recognised in the results of the Parent Company for the year ended
31 December 2014, being the recognition of a deferred tax asset in respect of the Company’s interest rate
swaps and available for sale investments (shares).

Reconciliation of capital and reserves

As previously reported

Recognition of deferred tax asset

Reconciliation of retained profit

As previously reported

Recognition of deferred tax asset

1 January
2014
£’000

30,412

3,455

33,867

31 December
2014
£’000

20,400

5,407

25,807

31 December
2014
£’000

10,732

5,407

16,139

49. Authorisation of financial statements and statement compliance with FRS101

The financial statements of Panther Securities PLC (the “Company”) for the year ended 31 December 2015
were authorised for issue by the Board of Directors on 27 April 2016 and the balance sheet was signed on
the board’s behalf by A S Perloff. Panther Securities PLC is incorporated and domiciled in England and Wales.

These financial statements were prepared in accordance with Financial Reporting Standard 101 Reduced
Disclosure Framework (FRS 101) and in accordance with applicable accounting standards.

The Company’s financial statements are presented in Sterling and all values are rounded to the nearest (£000’s)
except when otherwise indicated.

The results of Panther Securities PLC are included within the consolidated financial statements of Panther
Securities PLC. The principal accounting policies adopted by the Company are set out in note 36.

Panther Securities P.L.C.

Notice of Annual General Meeting

Notice is hereby given that the 82nd Annual General Meeting of Panther Securities P.L.C. will be held at Nexia Smith
and Williamson, 25 Moorgate, London EC2R 6AY on 15 June 2016 at 11.30 a.m. for the following purposes:-

As Ordinary Business
1.

To receive and adopt the Group Strategic Report, Directors’ Report and Financial Statements for the year
ended 31 December 2015 contained in the document entitled “Annual Report and Financial Statements 2015”.

To authorise the payment of a final dividend of 3.0p per ordinary share.

To re-elect B. R. Galan who is retiring by rotation, as a Director.

To re-elect P. M. Kellner who is retiring by rotation, as a Director.

To re-appoint the auditors Nexia Smith & Williamson and to authorise the Directors to determine their
remuneration.

As Special Business
To consider, and, if thought fit, pass the following resolutions of which resolutions 6, 8 and 9 will be proposed as
ordinary resolutions and resolution 7 as a special resolution.

That for the purposes of section 551 Companies Act 2006 (and so that expressions used in this resolution shall
bear the same meaning as in the said section 551):

6.1

the Directors be and are generally and unconditionally authorised to allot equity securities (as defined in
section 560 of the Companies Act 2006) up to a maximum aggregate nominal amount of £2,400,000
to such persons and at such times and on such terms as they think proper during the period expiring
at the earlier of 15 months from the date of passing of this resolution and the conclusion of the Annual
General Meeting of the Company to be held in 2016 (unless previously revoked or varied by the Company
in general meeting) except that the Company may before such expiry make any offer or agreement
which could or might require relevant securities to be allotted after such expiry and the Directors may
allot relevant securities pursuant to any such offer or agreement as if such authority had not expired; and

6.2

this resolution revokes and replaces all unexercised authorities previously granted to the directors
pursuant to section 551 of the Companies Act 2006 but without prejudice to any allotment of shares or
grant of rights already made, offered or agreed to made pursuant to such authorities.

That, subject to the passing of resolution 6, set out in the Notice convening this Meeting, the Directors are
empowered in accordance with section 571 of the Companies Act 2006 to allot equity securities (as defined
in section 560 of the Companies Act 2006) for cash, pursuant to the authority conferred on them to allot equity
securities (as defined in section 560 of the Act) by that resolution and/or to sell equity securities held as treasury
shares for cash pursuant to section 727 of the Companies Act 2006, in each case as if section 561 (1) of the
Companies Act 2006 did not apply to any such allotment or sale, provided that the power conferred by this
resolution shall be limited to:

7.1

the allotment of equity securities in connection with an issue or offering in favour of or sale to holders of
equity securities and any other persons entitled to participate in such issue or offering where the equity
securities respectively attributable to the interests of such holders and persons are proportionate (as
nearly as may be) to the respective number of equity securities held by or deemed to be held by them
on the record date of such allotment, subject only to such exclusions or other arrangements as the
Directors may consider necessary or expedient to deal with fractional entitlements or legal or practical

Panther Securities P.L.C.

7.2

7.3

problems under the laws or requirements of any recognised regulatory body or stock exchange in any
territory;

the allotment or sale (otherwise than pursuant to paragraph 7.1 above) of equity securities up to an
aggregate nominal value not exceeding £218,591; and

the power granted by this resolution, unless renewed, shall expire at the earlier of 15 months from the
date of passing of this resolution and the conclusion of the Annual General Meeting of the Company to
be held in 2016 but shall extend to the making, before such expiry, of an offer or agreement which would
or might require equity securities to be allotted after such expiry and the Directors may allot equity
securities in pursuance of such offer or agreement as if the authority conferred hereby had not expired.

That the Company is generally and unconditionally authorised for the purpose of section 701 Companies Act
2006 to make market purchases (as defined in section 693 (4) of the said Act) of ordinary shares of 25p each
in the capital of the Company (“ordinary shares”) provided that the Company be and is hereby authorised to
purchase its own shares by way of market purchase upon and subject to the following conditions:-

8.1

The maximum number of shares which may be purchased is 2,500,000 ordinary shares;

8.2

8.3

The maximum price (exclusive of expense) at which any share may be purchased is the price equal to
5 per cent, above the average of the middle market quotations of an ordinary share as derived from the
London Stock Exchange Daily Official List for the five business days preceding the date of such purchase,
and the minimum price at which any share may be purchased shall be the par value of such share; and

The authority to purchase conferred by this Resolution shall expire at the conclusion of the next Annual
General Meeting of the Company provided that any contract for the purchase of any shares as aforesaid
which was concluded before the expiry of the said authority may be executed wholly or partly after the
said authority expires.

That the directors be authorised to make a payment of up to £25,000 by way of donation to the UK
Independence Party.

The directors believe that the proposals in resolutions 1-9 are in the best interests of shareholders as a
whole and they unanimously recommend that you vote in favour of the resolutions.

By order of the Board
S. J. Peters
Company Secretary

Registered Office
Deneway House
88-94 Darkes Lane
Potters Bar
Hertfordshire EN6 1AQ

Dated: 27 April 2016

Panther Securities P.L.C.

Notice of Annual General Meeting continued

Notes:
1.

Any member of the Company entitled to attend and vote at this meeting is also entitled to appoint a proxy to
attend and vote in his stead. Such a proxy need not also be a member of the Company.

A shareholder may appoint more than one proxy in relation to the Annual General Meeting provided that each
proxy is appointed to exercise the rights attached to a different share or shares held by that shareholder.

A proxy form is enclosed. To appoint a proxy, shareholders must complete:

•

a form of proxy and return it together with the power of attorney or other authority (if any) under which
it is signed or a notarially certified copy of such authority, to Capita Asset Services, PXS, 34 Beckenham
Road, Beckenham, BR3 4TU ; or

a CREST Proxy Instruction (as set out in paragraph 5 below);

in each case so that it is received not later than 48 hours before the meeting. To appoint more than one proxy,
you will need to complete a separate proxy form in relation to each appointment.

Please read the notes on the proxy form. The return of a completed proxy form, will not prevent a shareholder
attending the Annual General Meeting and voting in person if he/she wishes to do so.

CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment
service may do so for the Annual General Meeting and any adjournment(s) of the meeting by using the
procedures described in the CREST Manual (available via www.euroclear.com/CREST). CREST personal
members or other CREST sponsored members, and those CREST members who have appointed a service
provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the
appropriate action on their behalf.

In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate
CREST message (a “CREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear
UK & Ireland Limited’s specifications, and must contain the information required for such instruction, as
described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a
proxy or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid,
be transmitted so as to be received by the Company’s agent RA10, by the latest time for receipt of proxy
appointments set out in paragraph 2 above. For this purpose, the time of receipt will be taken to be the time
(as determined by the timestamp applied to the message by the CREST Applications Host) from which the
Company’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST.
After this time, any change of instructions to proxies appointed through CREST should be communicated to
the appointee through other means.

CREST members and, where applicable, their CREST sponsors or voting service providers, should note that
Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular
messages. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy
Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a
CREST personal member, or sponsored member, or has appointed any voting service provider(s), to procure
that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that
a message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service providers are referred, in particular,
to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.

In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the
appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in
which the names of the joint holders appear in the Company’s register of members in respect of the joint
holding (the first-named being the most senior).

Any person to whom this Notice is sent who is a person nominated under section 146 of the Companies Act
2006 to enjoy information rights (a “Nominated Person”) may, under an agreement between him/her and the
shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else

Panther Securities P.L.C.

appointed) as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment
right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions
to the shareholder as to the exercise of voting rights. The statement of the rights of shareholders in relation to
the appointment of proxies in paragraphs 1, 2 and 3 above does not apply to Nominated Persons. The rights
described in these paragraphs can only be exercised by shareholders of the Company

A statement of all transactions of each Director and his family interests in the share capital of the Company
will be available for inspection at the Company’s registered office during normal business hours from the date
of this notice up to the close of the Annual General Meeting and will be available for inspection at the place of
the Annual General Meeting for at least 15 minutes prior to and during the meeting.

10. Pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, the Company gives notice that
only those shareholders included in the register of members of the Company at 5.30 p.m. on 13 June 2016
or, if the meeting is adjourned, in the register of members at 5.30 p.m. on the day which is two days before
the day of any adjourned meeting, will be entitled to attend and to vote at the Annual General Meeting in
respect of the number of shares registered in their names at that time. Changes to entries on the share register
after 5.30 p.m. on 13 June 2016, or, if the meeting is adjourned, in the register of members at 5.30 p.m. on
the day which is two days before the day of any adjourned meeting, will be disregarded in determining the rights
of any person to attend or vote at the Annual General Meeting.

11. As at 9.00 a.m. on 27 April 2016, the Company’s issued share capital comprised 17,746,929 ordinary shares
of 25 pence each. Each ordinary share carries the right to one vote at a general meeting of the Company and,
therefore, the total number of voting rights in the Company as at 9.00 a.m. on 27 April 2016 is 17,746,929.

12. Under section 527 of the Companies Act 2006, members meeting the threshold requirements set out in that
section have the right to require the Company to publish on a website a statement setting out any matter
relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the conduct of the audit)
that are to be laid before the Annual General Meeting; or (ii) any circumstance connected with an auditor of
the Company ceasing to hold office since the previous meeting at which annual accounts and reports were
laid in accordance with section 437 of the Companies Act 2006. The Company may not require the
shareholders requesting any such website publication to pay its expenses in complying with sections 527 or
528 of the Companies Act 2006. Where the Company is required to place a statement on a website under
section 527 of the Companies Act 2006, it must forward the statement to the Company’s auditor not later than
the time when it makes the statement available on the website. The business which may be dealt with at the
Annual General Meeting includes any statement that the Company has been required under section 527 of
the Companies Act 2006 to publish on a website.

13. Any member attending the meeting has the right to ask questions. The Company must answer any such
question relating to the business being dealt with at the meeting but no such answer need be given if: (a) to
do so would interfere unduly with the preparation for the meeting or involve the disclosure of confidential
information; (b) the answer has already been given on a website in the form of an answer to a question; or (c)
it is undesirable in the interests of the Company or the good order of the meeting that the question be
answered.

14.

If you have sold or otherwise transferred all your ordinary shares in the Company, please forward this annual
report and accounts to the purchaser or transferee or to the stockbroker, bank or other person through whom
the sale or transfer was effected for transmission to the purchaser or transferee.

15. No Director is employed under a contract of service.

16. You may not use any electronic address provided in this Notice, or any related documents including the proxy

form, to communicate with the Company for any purposes other than those expressly stated.

17. A copy of this Notice, and other information required by section 311A of the Companies Act 2006, can be

found at www.pantherplc.com

Panther Securities P.L.C.

Notice of Annual General Meeting continued

Explanatory Notes to the Notice of Annual General Meeting
The following notes provide an explanation as to why certain resolutions set out in the notice of the Annual General
Meeting of the Company to be held on 15 June 2016 are to be put to shareholders.

All resolutions save for Resolution 8 are ordinary resolutions and will be passed if more than 50% of the votes cast
for or against are in favour. Resolution 8 is a special resolution and requires 75% of the votes cast.

Resolution 1 – Laying of accounts and adoption of reports
The directors are required by the Companies Act 2006 to present to the shareholders of the Company at a general
meeting the reports of the directors and auditors, and the audited accounts of the Company, for the year ended
31 December 2015. The report of the directors and the audited accounts have been approved by the directors, and
the report of the auditors has been approved by the auditors. A copy of each of these documents may be found in
the document entitled “Annual Report and Financial Statements 2015”.

Resolutions 3 and 4 – Re-election of directors
In accordance with the Articles of Association of the Company Andrew Perloff and John Perloff will stand for re-
election as directors of the Company. Biographical information for the directors and details of why the Board believes
that they should be re-elected is shown in the Corporate Governance Report.

Resolution 5 – Auditors’ re-appointment and remuneration
The Companies Act 2006 requires that auditors be appointed at each general meeting at which accounts are laid,
to hold office until the next such meeting. The resolution seeks shareholder approval for the re-appointment of Nexia
Smith & Williamson and the giving to the directors the authority to determine the remuneration of the auditors for
the audit work to be carried out by them in the next financial year. The amount of the remuneration paid to the
auditors for the next financial year will be disclosed in the next audited accounts of the Company.

Resolution 6 – Authority to the directors to allot shares
The Companies Act 2006 provides that the directors may only allot shares if authorised by shareholders to do so.
Resolution 6 will, if passed, authorise the directors to allot shares and to grant rights to subscribe for, or convert
securities into, shares up to a maximum nominal amount of £2,400,000, which represents an amount which is
approximately equal to 55% of the issued ordinary share capital of the Company as at 26 April 2016 the latest
practicable date prior to the publication of the notice.

Resolution 7 – Dis-application of statutory pre-emption rights
The Companies Act 2006 requires that, if the Company issues new shares for cash or sells any treasury shares, it
must first offer them to existing shareholders in proportion to their current holdings. It is proposed that the directors
be authorised to issue shares for cash and/or sell shares from treasury up to an aggregate nominal amount of
£218,591 (representing approximately 5% of the Company’s issued ordinary share capital as at 26 April 2016, the
latest practicable date prior to the publication of the notice) without offering them to shareholders first in order to raise
a limited amount of capital easily and quickly if needed. The resolution also modifies statutory pre-emption rights to
deal with legal, regulatory or practical problems that may arise on a rights or other pre-emptive offer or issue. If
resolution 5 is passed, this authority will expire at the same time as the authority to allot shares given pursuant to
resolution 6.

Resolution 8 – Purchase of own shares by the Company
If passed, this resolution will grant the Company authority for a period of up to the end of the next annual general
meeting to buy its own shares in the market. The resolution limits the number of shares that may be purchased to
5% of the Company’s issued share capital as at 26 April 2016, the latest practicable date prior to the publication of
the notice. The price per ordinary share that the Company may pay is set at a minimum amount (excluding expenses)
of 25 pence per ordinary share and a maximum amount (excluding expenses) of 5% over the average of the previous
five business days’ middle market prices. The directors will only make purchases under this authority if they believe
that to do so would result in increased earnings per share and would be in the interests of the shareholders generally.

Panther Securities P.L.C.

Beales’ Southport Department Store

Wayfarers Arcade which adjoins and links to Beales’ Southport Department Store

Panther Securities P.L.C.

Rear half of Wayfarers Arcade Southport

Panther Securities P.L.C.

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Printed by Michael Searle & Son Limited

Panther Securities P.L.C.
Deneway House
88-94 Darkes Lane
Potters Bar
Hertfordshire EN6 1AQ
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