Panther Securities Annual Report 2019

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FY2019 Annual Report · Panther Securities

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ANNUAL REPORT &
FINANCIAL STATEMENTS

2019

Company number 00293147

Andrew Perloff

(Chairman &
Chief Executive)

Joined: 1972

Simon Peters

(Finance
Director)

Joined: 2004

John Perloff

(Executive
Director)

Joined: 1994

Peter Kellner

(Non-Executive
Director)

Joined: 1994

Bryan Galan

(Non-Executive
Director)

Joined: 1994

Raphael Rotstein

Jack Bispham

(Assistant to
Finance Director)

Joined: 2017

(Joint Head of
Property)

Joined: 2011

Richard Swan

(Joint Head of
Property)

Joined: 2010

Anthony Kellner

(Solicitor)

Joined: 2006

Hyam Harris

(In-House Legal
Advisor)

Joined: 1985

Vandana Shah

(Finance
Controller)

Joined: 2017

Ram Patel

(Finance
Controller)

Joined: 1991

Lee Avanzo

(Head of
Credit Control)

Joined: 2013

Ingrid Tack

(Architectural
Technician)

Joined: 2019

Lee-Anna Mayers

(Property
Manager)

Joined: 2014

Tara Norrington

Hiral Parikh

Yvonne Headlam

Marsha Vaknine

Kerry Howard

Nicola Adams

(Property
Administrator)

Joined: 2018

(Accounts
Administrator)

Joined: 2019

(Reception)

(PA to Chairman)

(PA to Executive
Director)

Joined: 2005

Joined: 2017

Joined: 1988

Joined: 2018

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Contents

Review of the Year

Directors, Secretary and Advisors

The Year in Brief

Chairman’s Statement

Chairman’s Ramblings

Governance Report

Group Strategic Report

Directors’ Report

Corporate Governance

Financial Report

Independent Auditors’ Report on the Consolidated Financial Statements

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 Financial Statements

Independent Auditors’ Report on the Parent Company Financial Statements

Parent Company Statement of Financial Position

Parent Company Statement of Changes in Equity

Notes to the Parent Company Financial Statements

Shareholder Information

Notice of Annual General Meeting

Forty Nine Year Review

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Directors, Secretary and Advisors

Directors

Andrew Stewart Perloff (Chairman and Chief Executive)
Bryan Richard Galan (Non-executive)*
Peter Michael Kellner (Non-executive)*
John Henry Perloff (Executive)
Simon Jeffrey Peters (Finance)

Company Secretary

Simon Jeffrey Peters

Registered Office

Unicorn House, Station Close, Potters Bar, Herts, EN6 1TL

Company number

00293147

Website

www.pantherplc.com

Auditor

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

Bankers

HSBC Bank PLC
31 Holborn, London, EC1N 4HR

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

Shawbrook Bank Ltd
PO Box 878, Newport, NP20 9LJ

Nomad, Financial Advisors
and Joint Brokers

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

Joint Brokers

Raymond James Investment Services
Ropemaker Place, 25 Ropemaker St, London, EC2Y 9LY

Registrars

Link Asset Services
6th Floor, 65 Gresham Street, London, EC2V 7NQ

Solicitors

Howard Kennedy LLP
1 London Bridge, London, SE1 9BG

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

Brodies LLP
110 Queen Street, Glasgow, G1 3BX

Fox Williams LLP
10 Finsbury Square, London, EC2A 1AF

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

* Member of the Audit Committee and Remuneration Committee

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

The Year in Brief

Revenue – rents receivable

(Loss)/profit before tax

Total comprehensive (loss)/income for the year

Net assets of the Group

(Loss)/earnings per 25p ordinary share
Basic and diluted – continuing operations

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

Net assets attributable to ordinary shareholders per 25p ordinary share

* 6p interim was paid in 2018, 15p special was paid in January 2019, and 6p was paid in January 2019.

2019
£’000

14,226

(4,963)

(4,240)

84,946

2018
£’000

13,607

8,700

6,884

94,029

(23.1)p

39.9p

12p

480p

27p*

532p

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Statement

I am pleased to present our accounts for the year ended
31 December 2019 even though they show a loss of
£4,093,000 after allowing for a tax credit of £870,000. This
loss is mainly due to a directors’ revaluation of our entire
portfolio amounting to an £8,832,000 decrease in value.

Our rental receivable during the year ended 31 December
2019 amounted to £14,226,000 compared to the
previous year of £13,607,000 despite having sold over
£40,000,000 of property during the previous year. The
income lost from these sold properties has more than
been replaced by purchases probably costing less than
half the capital received from the earlier sales.

Disposals

Victoria Street, Wolverhampton

This freehold corner site which had been cleared after
receiving planning permissions for two alternative
developments was sold for £710,000 against a previous
book value of £150,000.

Skinnergate, Darlington

A large, vacant freehold shop in Skinnergate, Darlington,
with a book value of £400,000, was sold to the local council
for £355,000 after being vacated by Argos PLC following
their takeover and reorganisation by Sainsbury’s. This
property was on the point of being let to a well-known
multiple who withdrew a few days before signing the lease.
This was due to House of Fraser and Marks & Spencer
both announcing they were closing their stores in the
town only the previous week. Large stores are, of course,
vital to town centres as they draw in shoppers thus helping
all town centre traders, large and small. I am not sure
central government even now understand this point.

High Street, Kings Lynn

Whilst not really a disposal, this single unit, let to a charity
shop, experienced a fire that completely destroyed the
unit. We received insurance proceeds of which £145,000
has been treated as value over its book value, after we have
provided about a third of the receipts to cover demolition
and site clearance (and left a small amount within
Investment Properties to account for the land value).

Acquisitions

New Century and Jackson House, Gateshead

In July 2019 we completed on the freehold purchase of
New Century and Jackson House in Gateshead for
£4.65m. This is a large block containing a mix of retail,

offices and leisure with a net internal area of 91,663 sq. ft.
located in the centre of Gateshead directly opposite the
metro station and approximately a mile from Newcastle
City Centre. The block is anchored by Pure Gym on a long
lease, with J D Wetherspoon, Argos and Peacocks being
some of the other well-known tenants. At the date of
acquisition, the block was producing an income of
£790,000 per annum showing a return of 17.0% prior to
costs. There are various asset management opportunities
to improve the income by letting some vacant space.

De Clare Business Park, Pontygwindy Road, Caerphilly

On 4 September 2019 we completed the freehold
acquisition of De Clare Business Park, Caerphilly, South
Wales for £2.7m. This business park is made up of four
independent modern office buildings with the majority of the
offices let to the government and local council. In total there
is circa 48,241 sq. ft. of office space with parking for 163
vehicles. With a current rent roll of £376,000 per annum, this
represents a return of 13.9% and adds non-retail
diversification to our portfolio. There is some vacant space
available and we may be able to increase the rents,
enhancing the scheme’s value under our own management.
During the acquisition process we were able to agree terms
for a letting of one of the vacant suites at a higher rent per
square foot than had previously been expected.

Beales

In last year’s accounts I mentioned my private company
had, in October 2018, disposed of its interest in Beales’s
trading operations to its management who were able to
arrange additional finance from a private equity company
with extensive retail connections and experience.

I took this decision as I felt Beales had a much better
chance of survival as the management buyout was
supported by a fund with deeper pockets and wider retail
connections than my own. However, central government
actions,
shrinking markets
overwhelmed department store groups’ ability to produce
a profit thus many CVAs, administrations and store
closures in the retail sector have been occurring.

inactions,

and

Beales was placed in administration on 20 January 2020.
We received a number of questions from concerned
shareholders and stakeholders regarding the effect on the
Panther Group. On 27 January 2020 we announced that in
a worst case scenario if trading ceased in all thirteen of
their stores owned by the Panther Group there should not
be a material effect on our current year’s revenue or long
term effect on the freehold values of the properties
they occupied.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Statement continued

Recently it was announced that practically all their stores
would close due to the severe deterioration in the trading
climate caused by the COVID-19 pandemic.

The Panther Group owns Beales stores in Peterborough,
Mansfield, Great Yarmouth, two in Lowestoft, Skegness,
St Neots, Spalding, Wisbech, Beccles, Diss, Keighley,
Bishop Auckland and Perth. These properties are all
freehold in town centre positions, mostly large in size, in
different degrees of primeness of position and desirability.

The total gross floor area of these buildings is about
750,000 sq. ft. and the rental income lost from Beales’
tenancies was about £887,000 per annum. However, we
should receive directly in a full year, rents or profits from
three car parks of circa £200,000 per annum plus the
ability to create three further small car parks maybe worth
between £50-£60,000 per annum.

A number of the stores have exciting redevelopment
possibilities which we are currently exploring, i.e., see
photo of Bishop Auckland. Many are eminently splittable
to smaller units thus opening up the possibility of a much
wider range of users.

Many people would consider this a disaster and in many
respects it is. When a large enterprise that has been
trading for over 130 years fails, especially if within a town’s
central shopping area or heart, it has several implications.
It is bad for the town, upsetting for the multi-generational
families of customers, financially disrupting and dispiriting
for many hundreds of long term, loyal and knowledgeable
employees and also seriously financially inconveniences
thousands of reliable suppliers and concession occupiers.

I am very saddened by these circumstances, more so in
the knowledge that another of the most vital of the high
street’s failing retail groups could have been saved if
central government had been less rapacious in their
financial demands and burdens on a struggling sector.

However, I see this group of properties coming back into
our fold as an opportunity for our team, using their
experience and asset management skills, to formulate and
promote new and more relevant uses for
these
properties. We believe this will in due course produce a
much greater income and capital value for our Group.

I have mentioned at length the Beales situation as the
publicity is substantial but shareholders should be aware
it represents only about 6% of our income and less than
10% of our Group’s assets and I believe have prospects of
substantial appreciation when business activity recovers
from its present problems.

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Because it will involve considerable extra work and attention
by our team this coming year, I have put their photos, roles
and length of service with us in the accounts so that
shareholders can see that our Group is a skilled team.

Developments

High Street, Broadstairs

We have commenced the development of a mini market (a
pre-let has been agreed to a national convenience operator)
which will have twelve flats on three floors above. We
anticipate we will let the flat units and retain the completed
development as an investment. This development is
expected to be completed towards the end of this year.

Newgate Street, Bishop Auckland

Planning permission has been obtained for partial
demolition and conversion of this former listed Beales
store as three ground floor commercial units with flexible
A1/A3 use and either a 62 bedroom hotel or
27 apartments above. It is currently being marketed to see
if there is possible interest from a hotel operator.

Barry Parade, London, SE22

This property has committee approval for redevelopment
as a 5,400 sq ft retail/commercial space which could
probably be pre-let before a development commences
and also thirteen residential apartments in the upper part,
four of these units must be affordable. This approval is still
subject to agreeing the Section 106 requirements which
are quite extensive, expensive and still under negotiation.

This planning application is shown as being submitted in
July 2018. This is not quite the case. In December 2013
we asked our architects to discuss with planners whether
a redevelopment of this site would be favourably
considered. They were told the council would be pleased
to see this site redeveloped because it was currently both
unattractive and inappropriate for the area. We asked our
architects to produce a brief outline of an attractive
scheme that would create best value for the site and
submit it for a pre-application response. It took five
months to receive the pre-application written response
after about a three month delay for the initial meeting
entirely caused by the council.

We eventually submitted our planning application at the
beginning of July 2015 after numerous reports and
changes required by the council, mainly reducing the
height and size of the scheme also reducing down to nine
large, luxury units, the limit before you had to provide
social housing on site.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Statement continued

On 29 September 2015 the planners asked us to withdraw
our application as they disliked the large luxury flats and
there were many objections to the potential tenant being
a Co-op minimarket. We understood a Waitrose probably
would have had less objections!

The scheme was redrafted taking account of most of the
planners’ suggestions and also providing the additional
supporting reports required. The new application was
submitted in August 2016. The council then refused to
accept the application mentioning new requirements
coming into force in 2017.

A further pre app was necessary at which point the council
raised further revisions and requested additional plans,
reports and surveys. The new application was eventually
submitted in July 2018.

Committee approval was given subject to agreeing the
Section 106 payments etc at a committee meeting held on
29 January 2020. It will take about 18 months to two years
to develop ready for occupation. We will probably retain the
freehold and the commercial element as an investment and
sell the residential units on long leases when the
development is completed. The history of this property is
particularly interesting to me as an original investment held
since my father purchased the freehold for £7,000 in 1950
and I have been dealing with it since 1966, thus I felt it
warrants a supplementary ramblings to itself.

Financial Derivative

The liability on our interest rate swaps has risen slightly
due to the market’s perception of future interest rates
falling. However, on 1 December 2021 our interest
payable will, assuming our margin does not change on
renewal, reduce by about £625,000 per annum as one of
the older swaps ceases.

Finance

As at 31 December 2019, the Group were utilising
£60 million of our £74 million facility and also had a
£9,485,000 cash balance available.

Dividends

We have paid uninterrupted dividends for thirty seven
years through good times and occasional downturns and
I see no reason to change this policy. I am well aware that
our shareholders appreciate the reliability of receiving

dividends. The back of the accounts shows an abbreviated
schedule of the Group’s progress since its takeover by my
group of investors in 1972.

The Directors are thus recommending a final dividend for
the year ended 31 December 2019 of 6p per share. This
will be payable on 7 September 2020 to shareholders on
the register at the close of business on 7 August 2020
(ex-dividend on 6 August 2020).

Prospects

For once I find this difficult to predict for despite many
years of cautionary and profitable investing, and minor
development of properties in our ownership we have
always been careful to manage our risk profile. We are
currently in unknown territory due to a pandemic virus
attack affecting the entire population and the economy.

The government are taking all steps that they feel
necessary to bring under control this major health and
economic hazard that could fatally affect much of
our population.

These measures may create as little as three months’
disruption but maybe much more. The forced closure of
many businesses will cause hardship all the way down
the line.

The Chancellor has unveiled a huge assortment
of assistance to help the entire economy and
congratulations are in order for the speed with which
they have unveiled these measures.

Of course, as usual, the property industry has been
completely overlooked whereas a vast number of other
businesses have a one year business rates holiday. Now
that it is illegal to trade from many of these premises they
have no rental value and even if possible to re-let, it needs
a long timescale and generous incentives to do so. Should
a qualifying business such as a retailer or leisure operator
exit the premises, then somehow the freehold owner
would then have to pay full rates with no income! Vacant
rates were a ridiculous imposition even before COVID-19
came along.

When a tenant, however successful, faces temporary
financial problems, their first port of call for help is their
landlord as usually they get a quick and helpful response
whilst governments take much longer to help and often
with small print in the financial offer that excludes many.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Statement continued

I am hoping and expecting that this pandemic will not
be quite as bad as some doom-mongers predict and
within 6 to 9 months we will be back to a normal free
enterprise system.

With this thought in place, whilst this situation may be
temporarily testing to our Group, we may recover
strongly once the health of our nation and our economy
is back to normal.

However, I can confirm that we have enough financial
resources, and with supportive lenders, do not see any
issue to prevent us surviving for more than double the
length of even the most pessimistic predictions. Further
as already announced we estimate that approximately
41% of our rental income comes from businesses that
have not been forced to close or been recommended to
close under government guidelines. The annual income
from these businesses is approximately £5.6m and would
be enough to cover our interest obligations to our lenders
of approximately £4.1m and most of our overheads.

Finally, I would like to thank our small but dedicated team
of staff, growing team of financial advisers, legal advisers,
agents and accountants for all their hard work during the
past year, which has been extremely busy and promises
to be even more demanding for the current year than
usual. Special thanks and good wishes are extended to our
tenants and I hope they are able to overcome the present
troubled environment and make a full recovery when
business is back to normal.

Andrew S Perloff
Chairman

14 May 2020

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Ramblings

Regular readers of my ramblings will be aware of the
special place Margate holds in my heart. It was there in the
50s that my parents had owned The White Hart, a
seafront pub/hotel which they also ran, helped by their
press ganged children. Indeed, in those halcyon summer
days of perpetual sunshine and no health and safety laws,
we were so small we had to stand on boxes to serve the
endless throng of thirsty customers.

It was unsurprising therefore that when I was finally old
enough to be allowed to take my first parent free holiday,
it was to Margate I headed with two of my friends.

I was eighteen years old and had been working for less
than a year when we set off for our 10-day summer
holiday. The excitement! The world was our oyster
(though not in the case of one friend who was strictly
kosher). Our destination was a large old double building
converted to a Kosher boarding house – one hundred
yards from the beach, close to the town centre and
Dreamland amusement park. A perfect position for young
men ready to enjoy their first taste of freedom away from
loving but watchful parents. We had a wonderful time,
either on the beach or in local coffee bars depending on
the weather, with the local dance clubs luring us
townwards in the evening. We made friends with other
young men and women and alcohol which necessitated
one of our party (the strictly kosher one) being carried
back to the boarding house nearly every night by me.

It was a long time ago and although most events have
dimmed into a vague but happy blur of memories, one
incident stands out in sharp focus. It was yet another
beautiful, sunny day and we were in a nearby coffee bar,
which was one of our favourite haunts in a grand but faded
glory Victorian hotel facing the seafront. It was a very
popular meeting spot, probably the Starbucks of its day,
and we soon came to know its habitués. We became
friendly with a group of young men who, although dressed
menacingly in black leather jackets, were really rather
friendly. They obviously liked to imagine they were the
Margate chapter of the notorious Californian Hell’s Angels
and seemed immensely proud of their large and gleaming
motorbikes which were parked outside in a neat line.

The apparent leader of the pack was a self-styled Marlon
Brando and we soon became pals. He surprised me one
day when he offered to take me for a spin on the back of
his bike. Excited and certainly unthinking, I immediately
agreed, mounted the bike (helmetless) and, with a mighty
rumble, off we went.

He followed the road which ran alongside the seafront
through Cliftonville, past open spaces, down Northdown
Road into Margate, round the clock tower, past Dreamland
and the train station all at a comfortable pace. We then
turned back towards our coffee bar. I heard ‘Marlon’ shout
“hold tight” and then his bike sped up from probably 20-
25 mph to at least the speed of light or maybe 80-90 mph.
I grasped tightly round his waist whilst Margate harbour,
the pier, seafront, and indeed my short life, all flashed past
me!
I was petrified and even more frightening was
cornering. The correct way, as any biker worth his salt, will
tell you is to lean into a bend. Alarmed, I leant the opposite
way which apparently it was exactly not what to do.
Although the terror seemed never ending I doubt if we
travelled for more than two minutes at this speed.

Needless to say I have never ridden, sat on or been a pillion
passenger on a motorbike since that date!

It was only after some years of mature reflection that
I realised I had given ‘Marlon’ absolute control of my safety
and my life for the 10 minutes I was his pillion passenger.
My life, my future, my hitherto unbroken bones and many
years’ yet to be written Chairman’s Ramblings were all in
his hands!

Alive and undamaged I returned home shortly afterwards,
having had a wonderful holiday and was soon back to my
usual routine.

Another place we regularly visited and which also still holds
special memories was near my home in Sutton, Box Hill, a
National Trust beauty spot and at over 700 ft high is one of
the largest hills in Surrey. At the base of the hill was a
historic and still old-fashioned hostelry. This may have had
a greater attraction than the natural, rustic beauty of the
place as for the small fee of 5/- per person allowed you
entrance to the hotel grounds where you could use their
open air pool and other facilities.

On one lazy summer Sunday I drove there with my father.
While I swam, he sat poolside on a wooden bench
watching the activities.

As I swam I noticed with great interest a young and very
attractive girl emerge from the changing rooms. She
looked like a young Bridget Bardot and whilst I was
frantically thinking how to get to know her, she walked past
my father, put her towel on his bench, sat down beside him
and shortly began talking to him. Opportunity should be
my middle name! I jumped – yes jumped – out of the pool
and joined them.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Ramblings continued

Within a few minutes I suggested we should go for a swim
and she agreed. Rising elegantly from the bench she dived
in and swam underwater the length of the pool with the
grace of Esther Williams. When she surfaced she waved
and shouted “Come on in”. It was impossible to refuse the
call of this Lorelei of the Lido so I then instantly dived in,
thinking I looked like one of Esther’s film partners, Johnny
Weissmuller of Tarzan fame, but I was probably more like
Norman Wisdom in ‘Trouble in Store’!

We swam and chatted in the pool for quite a while and
conversation eventually turned to work. When she asked
what I did I told her I was an estate agent. ‘Then you must
drive” she replied. “Do you have your own car?”. I told her
proudly that I was the owner of a pale blue mini FXV 512
which was in the car park. She told me she was allowed to
drive her mother’s car, a Morris Minor, but coincidentally
her favourite car which she was desperate to buy was a
Mini as soon as she saved enough money. “Perhaps you
would let me drive your car a bit to practice in a Mini?”.
I instantly agreed. Hill starts and reversing around corners
were far from my mind but the thought of being alone with
her for half an hour in the car park or country lanes of
Surrey was extremely tempting. We hardly dried
ourselves, dressing over our still damp costumes.

We walked out to the large car park and I helped her into
the car. Before she turned the key to start the engine,
I held her hand on the gear stick and guided her through
the five forward gears and one reverse gear which was
difficult to find. I can still remember the electric shock of
excitement as I held her hand. She hitched her dress up,
straightened her back, grasped the steering wheel and
started the engine. She put it into first gear and drove
round the car park slowly going through the lower gears.

She turned to me, smiled and sweetly said “I’ve got the
hang of it now. Can I drive for a while on the roads? I’ll drive
very, very carefully?”. With those country lanes in mind I
readily agreed. She drove slowly up to the car park exit
then joined the road.

WHOOSH!!! the G force threw me back in the seat and she
rushed through first, second and third gears in less than
10 seconds flat! “Be careful of the gears” I shouted
pointlessly over the roar of the engine. She sat up
straighter, clasped the wheel tighter and with a fixed stare
proceeded to race as fast as the car would go. The main
roads luckily had little traffic and she cornered a
roundabout or two on two wheels, leaning the right way
was the last thing on my mind. My various entreaties of “Be

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careful…. slow down a little……..you will
ruin my
engine…….we don’t want an accident…..it’s a small car” fell
on deaf ears. Finally I pleaded we must return as my father
would be waiting and may worry.

She drove me round the outskirts of Epsom and Dorking
for over twenty minutes, her peaches and cream
complexion became flushed red with excitement and
exhilaration. Mine was also flushed but from fear!
However, we got back in one piece.

Upon our return we quickly dived back into the pool but
the camaraderie and ardour for each other had dimmed.
Although we exchanged phone numbers we never saw
each other again. I suspect she thought I was a wimp and
despite her obvious attractions, I had no wish to join this
nifty, nubile nymphet on her inevitable early journey to the
hereafter but I do hope she survived to live a full and long
life. Maybe someone of Lewis Hamilton’s ilk is her
grandson having inherited her superb racing genes!

When I recall this short but exciting experience I once again
realise, even if it were for only 20 minutes, I had yet again
given someone else full control over my safety and life.

Control is an interesting word, especially in business
situations.

Some years after these long forgotten events my
business partners and I were becoming more successful in
the property business and I became increasingly
interested in corporate takeovers having completed my
contested takeover of Levers Optical Company Limited
in 1972. This company is, as of course many of you know,
now Panther Securities PLC.

This gave me a taste for corporate acquisitions and to
date I have initiated ten takeovers of listed companies, of
which two failed to achieve the control I desired although
I completed seven
were still profitable ventures.
successful private corporate acquisitions and was again
involved with three publicly listed companies where I held
30% of the equity and was appointed a board member
which gave me some influence in the control (that word
again) of the company.

My early ideas on corporate takeovers were based on the
belief that if you could secure 51% of the voting equity you
would be in control of the entire company. Of course,
then one automatically assumed you would have power
to appoint the Board of Directors but in practice this was
not always so.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Ramblings continued

Every one of my corporate adventures could produce an
interesting, amusing and business related vignette all
coming back to that word ‘control’.

The optical company had people running their own minor
internal department empires and each had separately
devised a benefit system just for themselves.

A poorly performing investment trust in mid takeover
allowed the fund managers to shift the previously
unagreed cost of the takeover to a management fee
which they received and thus did not show up until
sometime later, thus proving the fund managers had
control of the cheque book!

After I had secured 51% of another poorly performing
investment trust with a top line board, the Chairman
instructed his brokers to sell the entire share portfolio
worth £1,000,000 even after he had been told in no
uncertain terms that this was prohibited by takeover rules.
This sale went ahead anyway and after the takeover was
completed I was asked by my advisers if I wanted to make
a formal complaint. I declined as I had no wish to give the
former Chairman, a well-known and important influential
figure, a problem, but also the portfolio sale was what I
would have wanted to do – but would not break the rules.
Thus they carried out my desired wishes, probably in
anger. The point being the Chairman had control by virtue
of his authority.

A single department store with an excess of assets and
ever reducing profitability, where if we were successful we
would have removed one overpaid Managing Director.
However, via old former owners’ trusts, he had control
and managed to obtain a white knight rival store group
takeover who,
instantly upon the rival’s successful
announcement of its offer becoming wholly unconditional,
terminated the employment of many of the department
store’s management staff thus allowing the company to
be profitable again. Surprise, surprise, the Managing
Director kept his highly paid job. Thus control with no
equity was with the Managing Director.

One small property company had a nice portfolio of
income producing properties mainly acquired for part cash
and part shares and also building society loans – initially the
Managing Director had both board control and equity
control but the continuing acquisitions for equity reduced
his shareholding well below control level. This was risky but
much more so as the family team that ran the company
had salaries and expenses way, way in excess of the

company’s net income. They fell easily to a takeover and
the company had to be bailed out immediately to
complete its survival and revival. Again, it was control that
they lost.

I could give more mini stories on every one of our
corporate acquisitions but it all boils down to control. Not
just ownership but actual working control.

In the UK we have recently had one of the UK’s most
divisive elections which has pleasingly probably resolved
the Brexit conundrum. The Brexit question, in simplistic
terms, was about control of the UK either by a largely
unknown group of unelected bureaucrats which
supposedly represented the interests of an ever widening
group of diverse countries, or UK elected MPs and a
successful Brexit via this election could bring back the
control of the UK to its own elected representatives. Of
course many of our elected representatives are usually
inexperienced and unsuitable for the jobs they take on –
but at least can be sacked or changed after 5 years or
sometimes sooner if they prove useless.

All UK general elections (as are all elections) are about
control, either by one faction or another, with each side
having a different viewpoint – but each side always offering
something that isn’t really theirs to give, invariably causing
problems if and whenever their promises are fully
implemented.

The public realised this last election was simply a matter
of control of our country and only one long established
party offered them the potential answer. The public, in its
wisdom, created the landslide result.

Taxation is like hell. Hell being a construct promoted many
years ago by religious long established institutions to keep
people in line whereas taxation forces people having to
pay a share of running the country under harsh threats of
punishment by those whom the voters have elected to be
in control of government but I am forever surprised by its
stupidity in enactment.

Recently I was informed by my accountant that one of my
more recent personal tax returns had been questioned as
it appeared Beales had paid me £1,200 as an annual
director’s salary. They had indeed issued me with a cheque
after standard tax deductions but I deliberately never
cashed it as I felt unable to take a salary from a continuing
loss making business.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Ramblings continued

Despite the fact I did not receive any money, I was told as
Beales must have put it through their books I must pay tax
on this non income. Of course, the taxman never lost any
money as Beales did not make profits to pay Corporation
Tax. I had to pay the £300 extra tax which they billed me
for
three further six-monthly tax periods in the
assumption I would continue to receive this income. I also
had to pay a £200 fee to my accountant and, to rub salt in
the wound, tax of £40 on top i.e., for £900 that I never
received I had to pay £1,440!!!

Logic, common sense or fairness is rare as hen’s teeth in
tax offices.

Many of our shareholders will know that my mother, Fay,
died about three years ago. A significant amount of
inheritance tax was eventually paid after about eighteen
months of dealing with her estate.

As Benjamin Franklin remarked, there are only two
certainties in life; one is death and the other is taxes. This
assumes that after death one does not have to bother
about tax.

Sometime last year I received a generic letter from the tax
office addressed

“Dear Fay Perloff Deceased
Thank you for contacting us about your returns” ………

As you might expect, I was very upset. If my mother with her
super powers was going to contact anyone down here from
heaven above, she could have at least contacted me first!

So I suppose it’s fair to finish on ‘if the tax office is involved,
heaven help us’!

Supplementary Chairman’s Ramblings
Barry Parade (now a Group property) was a third rate
building containing twelve lock up shops situated in an
attractive corner position facing Peckham Rye Park. The
property at one time had a large Victorian era house with
a good sized corner garden and at a later date a parade of
lock up shops built sometime in the early
eight small
1930’s. The property was an early victim of a German V1
rocket raid in 1944 when the big house was completely
destroyed and the lock up shops partially damaged. (This
part of London, originally a smart suburb of Georgian and
Victorian London with many large attractive houses, and
later many huge estates of terraced houses built to house
London’s growing population was by the 1950’s in a

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severe decline as a residential area but still able to provide
good trade for the many local businesses).

I can remember visiting the site a number of times with my
father and brother. The trip round South London was
exciting for a six year old child and I remember seeing
workmen repairing the war damaged shops. A few years
later my father arranged to have four lock up shops built
upon the site of the big house directly facing Peckham Rye.
With hindsight I now know the buildings were built very
cheaply. Notwithstanding this the shops, which were
originally let at about £150 per annum each, were always fully
let and provided a useful facility for the local community.

I started managing the property in about 1966 when the
area had become more run down but it always held
its income.

Just over twenty years ago the area began to change for
the better due to the boom in the residential housing
market that was rippling through London. The old houses
that had been cheaply converted to flatlet houses were
being converted back to luxury houses and the flats
upgraded so that just acceptable living units became very
desirable flats convenient for Central London.

I thus started considering the development potential. Due
to the property’s existing income the building, with flats
above, at that time did not appear a particularly viable
development proposal. However, within a few years
continued escalating residential prices completely
changed the viability of any possible scheme.

It has now taken well over seven years to reach this stage
for a possible redevelopment and it would seem it will take
at least nine years from start to finish of the scheme.

Perhaps as it was the last World War that started my family
history of Barry Parade, with its partial destruction by a
wayward V1 rocket, it is a suitable timeline for comparison.

Germany invaded Poland on 1st September 1939 – then
France, Belgium, Holland and Russia. Germany’s
conquering progress was only put on the back foot when
America entered the war after Pearl Harbour in December
1941 and thus were eventually driven back into their own
territory and defeated in May 1945, i.e., nearly six years of
huge turmoil, destruction throughout most of Europe
which involved a monumental amount of planning and
organisational ability first by the Germans then by the
Allies for an eventual successful outcome.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Chairman’s Ramblings continued

And yet in Southwark, on a small obviously poorly and
underdeveloped site we are unable to get permission to
redevelop, let alone actually build a shop and 13 flats in
over seven years!

I suspect if one needed planning permission to build a
Wendy house in many boroughs it would be the original
applicant’s grandchildren, rather than the children who
might get the benefit of playing in it!

Yours

Andrew S Perloff
Chairman

14 May 2020

P.S. My Ramblings were prepared well before the first
inklings of the COVID-19 pandemic started to cause
such disruption to our everyday lives and business
activity which I have commented on at length in my
Chairman’s Statement.

However, ……… It reminds me that in last year’s accounts I
had prepared and arranged for a cartoon to be inserted
headed ‘The Ten Plagues of the High Street’
(all
government created) with the United Kingdom looking like
a war graves cemetery with many lines of gravestones all
either having shop group names or left blank for unknown
traders or those yet to follow.

I could not imagine that the 10th biblical plague would
arrive. I am sure you will be aware that this was called “The
Killing of the First Born”, i.e., the oldest, which is nearly what
is happening.

The government has pulled out all the stops and enlisted
the most knowledgeable medical advisors in an effort to
control and eradicate this virus. We all should be, and
almost certainly are, supportive of their efforts.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report

About the Group
Panther Securities PLC (“the Company” or “the Group”)
is a property investment company quoted 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 850 individual property
units within over 120 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,
and 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 excluding
lease portion/average borrowings for the year)

Yield (rents investment properties/average
market value investment properties)

Net assets value per share

(Loss)/earnings per share – continuing

Dividend per share

Investment property acquisitions

Investment property disposal proceeds

2019****

2018****

76%

41%

71%

39%

2017

71%

45%

2016

77%

49%

2.14 times

4.17 times

2.37 times

1.66 times

7.1%

6.6%

8.8%

480p

(23.1)p

12.0p

£8.1m

£1.1m

7.7%

532p

39.9p

27.0p***

£3.9m

£40.8m

6.4%

7.1%

516p

120.2p

22.0p***

£8.9m

£2.2m

6.6%

7.7%

407p

(5.5)p

12.0p

£5.0m

£5.8m

***

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 (excluding lease portion)
Includes 2018:15p (2017:10p) per share special dividend

**** IFRS 9 and 15 have only been reflected in 2018 and 2019 the prior year figure not restated. IFRS 16 has only been reflected in 2019 and the prior

year figure not restated.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

Business review
The Group’s underlying performance was strong in the
year ended 31 December 2019. The results are positive
once you remove the fair value write down on properties
and the fair value loss on the financial derivatives is
stripped out. The Group showed higher rents, higher
operating profits on a similar level of debt and strong cash
generation from operations. This can be seen in the
Consolidated statement of cash flow when the majority
of the tax paid in the year, which mainly relates to large
disposals in the year ended 31 December 2018 is ignored.
This year’s figures provide confidence that the underlying
business is performing well and improving when compared
to the prior year (stripping out disposals and other non-
cash movements).

The Directors believe (under normal circumstances) that
we have made two decent long-term purchases in 2019
at high returns, in Caerphilly and Gateshead, which the
Group purchased using free funds left over from the
disposals in 2018. This has replaced a large proportion of
the income lost on the disposals in 2018.

The investment property values were written down by the
Directors following the in-house valuation. These
valuations incorporated Brexit uncertainties at the year end
which impacted market values. These values also reflect
the risks associated with retailers as they try and adapt to
the fast changing consumer habits. However, the Group,
being a secondary retail property investor, has a lot of
neighbourhood parades. These tend to have a higher
proportion of businesses which are providing non-retail
offerings even though they are shops. This includes things
such as service providers, restaurants or take away use, or
convenience offerings, which have been less effected than
pure retail, and in some instances even provide additional
opportunities i.e. being able to offer their take away services
via Just Eat etc. Even our pure retail positions are mainly
large blocks in the centre of towns and will no doubt benefit
from longer term plans from the Government and local
councils looking into town centre regeneration schemes.
As such, if and when retail no longer works, we believe we
can create value from these sites with planning permission
to eventually give them other uses or purposes. In the
meantime, they continue in the most part to be strong cash
contributors providing high returns on initial investment.

Going forward
We stated in this section in our 2018 accounts that “…we
would be disappointed if we did not pick up a few good
investments in 2019, however these have to be carefully
selected as a lot of the risks perceived by the average
property investor are real.” This was achieved with the
purchases of Caerphilly and Gateshead, both with a good
spread of tenants and showing the usual high return we seek.

Unfortunately, 2019 already seems like a lifetime ago.
Since then not only have Beales entered into
administration (in January 2020), we now have the
COVID-19 to contend with, which affects a very large
majority of our tenants. Thankfully we still have a lot of
capacity in terms of funds as we de-geared substantially in
2018 following the large disposals and also have the
benefit of the non-reinvested cash funds. These facilities
and cash funds will help us weather the storm and we will
be in a much stronger position than most. This was
planned but also slightly fortuitous, as we were preparing
for Brexit uncertainties but it provides capacity financially
to withstand this health and economic crisis. Taking these
two issues in turn:

•

Beales administration

Even though it is sad to see the demise of another historic
business, and one we had a close association with, the
financial reality is that the Directors believe the vast
majority of these properties will be worth a lot more in the
medium to longer term without this tenant. The rents
were low compared to the space they let and the rent was
not always paid. Relating to the year ended 31 December
2019 the Group had circa £270,000 arrears unpaid
but fully provided against. Practically all the properties
have better alternative values and surprisingly all have
different solutions.

Whether it is re-letting and carving up, utilising the valuable
car parks, full-scale redevelopments, or interest from
councils as they look to revitalise town centres, we see the
former Beales sites as key. This is because they usually
were very central and our view is that all former stores
have potential. Some of these opportunities will be
realised quicker than others but we can already see a
glimmer of a silver lining. It is just a shame that the COVID-
19 has curtailed and/or slowed some of our discussions.

The Group recognised a loss in value following the
Directors’ year end valuation, of £8.8m (compared to
a £6.4m million loss in 2018 also following a
Directors’ valuation).

We are not concerned about these vacant properties in
the medium to longer term and see these as an
opportunity. We hope to report back on progress within
our interim accounts.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

•

COVID-19

This has been a much more challenging, wide spread and
fast changing situation than the business has ever faced
before. We believe for our size and within the property
sector, we have one of the most diverse and robust income
streams. We have such an array of tenants, spread over
different geographic locations, in different sectors, and lots
of sizes of traders, from sole traders to large multinational
corporates. One of the key characteristics of the business
that we have developed over many decades, in fact since it
recovered from the 1970s property crash, is ensuring a
strong diversified cash flow and this is reflected in our
investment decisions, which often show high returns,
generated from a spread of tenants. However, with the
government putting social distancing measures in place and
requesting businesses to close, this leaves us with very few
tenants remaining open for trading. We do have tenants
such as supermarkets, chemists, take-aways, flat tenants,
convenience stores and certain industrial uses still open for
business who hopefully will pay their full rent. We have tried
to assess what this means in terms of rental over this period
but it is such a fast moving situation that even those you
would not expect to be affected have been – however it
looks like as a minimum we will have our interest covered by
income. We are taking mitigation actions, such as reducing
our outgoings and keeping good dialogue with our tenants
and ensuring those that can pay do.

The impact of COVID-19 is considered to be a non-
adjusting post balance sheet event and as such the
Statement of Financial Position,
including property
valuations, has been prepared on the facts and
circumstances as at 31 December 2019.

However, even though there are uncertainties going
forward which may affect property prices in the short term,
we are protected by our portfolio’s diversity, experienced
management team, ability to adapt and by having access to
funds. We have low gearing levels, supportive lenders and
cash reserves, which the Directors believe can keep us
going for over 21 months even when assuming lower than
expected levels of rents. We expect to receive as a
minimum circa 41% of our rents which are from businesses
that are either not required to close or recommended to by
the government. This amounts to around £5.6m.

Financing
The Group had previously entered into a £75 million club
loan facility (£60 million term and £15 million revolving),
which was renewed on 19 April 2016 with a five-year term.

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This is up for renewal in April 2021 – on 31 December 2019
the maximum loan facility was £74m due to loan
repayment in the year. We have had initial discussions with
our lenders early in the year and they were very positive in
terms of renewing on similar terms. The discussions are
currently on hold as the Group and the banks deal with the
current crisis. However, our lenders’ relationship teams
are confident that when the COVID-19 crisis is over, we
can quickly get back on track, and in the worst case
scenario would look for a short term extension (to give us
more time for discussions and negotiations).

At the Statement of Financial Position date the Group had
£9.5m of cash funds, £14m available facility and a further
£10m included in our loan agreement but requiring credit
approval. In April 2020 cash was further increased as a net
amount of £3m was drawn on the facilities as well as the
lenders agreeing to release £1.5m of the £2.3m which was
restricted to property purchases (and included in the
£9.5m total).

Financial derivative

We have seen a fair value loss (of a non-cash nature) in our
long term liability on derivative financial instruments of
£0.997m (2018: £0.886m fair value gain). Following this
loss the total derivative financial
liability on our
Consolidated Statement of Financial Position is £26.5m
(2018: £25.5m).

These financial
instruments (shown in note 29) are
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 that in uncertain
economic times 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 term interest rates
were significantly higher. In a hypothetical world if we could
fix our interest at current rates and term we would have
much lower interest costs. Of course we cannot undo
these contracts that were entered into historically,
without a significant financial cost, but for accounting
purposes these financial instruments are compared to
current market rates, with the additional liability compared
to the market rates, as shown on our Statement of
Financial Position.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

In 2018 the Company entered into a new 10 year fixed
interest rate swap agreement, with a £25,000,000 nominal
value which commences on 1 December 2021. The swap’s
interest rate is 2.131% which will come into existence when
the Company’s current £25,000,000 swap with a rate of
4.63% ends, resulting in an annual saving of circa £625,000.
By entering this transaction, the Company will have
certainty that its interest costs from December 2021 will
be significantly lower compared to its current costs.

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
to a sub-
monitoring financial
committee of the Board. The policies set by the Board of
Directors are implemented by the Company and Group’s
finance department.

risk management

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 having a
large spread of tenants who operate in different industries.

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 exposure of
the Company and Group to inflation is low due to the low cost
base of the Group and natural hedge we have from 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.

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.

Principal risks and uncertainties of the Group
The successful management of risk is something the
Board takes very seriously as it is essential for the Group to
achieve long-term growth in rental income, profitability
and value. The Group invests in long term assets and
seeks a suitable balance between minimising or avoiding
risk and gaining from strategic opportunities.

The Group’s principal risks and uncertainties are all very
much connected as market strength will affect property
values, as well as rental terms and the Group’s finance, or
term loan, whose security is derived primarily from the
property assets of the business. The financial health of the
Group is checked against covenants that measure the value
of the property, as a proportion of the loan, as well as income
tests. The two measures of the Group’s finances are to
check if the Group can support the interest costs (income
tests) and also the ability to repay (valuation covenants).

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

The Group has a successful strategy to deal with these
risks, primarily its long lasting business model and strong
management. This meant the business had little or no
issues during the 2008 financial crisis, which some
commentators say was the worst financial crisis since the
Great Depression of the 1930s. We hope that the current
crisis will also show us in a good light due to the
preparations we made in 2018.

Market risk

If we want to buy, sell or let properties there is a market
that governs the prices or rents achieved. A property
company can get caught out if it borrows too heavily on
property at the wrong time in the market, affecting its
If loan covenants are broken, the
loan covenants.
Company may have to sell properties at non-optimum
times (or worse) which could decrease shareholder value.
Property markets are very cyclical and we in effect have
three strategies to deal with or mitigate the risk, but also
take advantage of this opportunity:

Strong, experienced management means when the
market is strong we look to dispose of assets and
when it is weak we try and source bargains i.e. an
emergent strategy also called an entrepreneurial
approach.

The Group has a diversified property portfolio and
maintains a spread of sectors over retail, industrial,
office and residential. The other diversification is
having a spread regionally, of the different classes
of property over the UK. Often in a cycle not all
sectors or locations are affected evenly, meaning
that one or more sectors could be performing
stronger, maybe even booming, whilst others are
struggling. The strong investment sectors provide
the Group with opportunities that can be used to
support slower sectors through sales or income.

3) We invest in good secondary property, which tends
to be lower value/cost, meaning we can be better
diversified than is possible with the equivalent funds
invested in prime property. There are not many
property companies of our size who have over 850
individual units and over 120 buildings/locations.
Secondary property also, very importantly, is much
the
higher
investment generates better interest cover and its
value is less sensitive to market changes in rent or
loss of tenants.

yielding which generally means

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Property risk

As mentioned above we invest in most sectors in the
market to assist with diversification. Many commentators
consider the retail sector to be in period of severe flux,
considerably affected by changing consumer habits such
as internet shopping as well as a preference for
experiences over products. Of the Group’s investment
portfolio, retail makes up the largest sector being circa 60
to 65% by income generation. However, the retail sector
is affected to lesser degrees in what we would describe as
neighbourhood parades, as opposed to traditional
shopping high streets. The large part of our retail portfolio
is in these neighbourhood parades, meaning we are less
affected by consumer habits and even benefit from some
of the changes. Neighbourhood parades provide more
leisure, services and convenience retail.

For example, we have undertaken a few lettings to local
or smaller store formats, to big supermarket chains, which
would not have taken place many years ago. Block policy is
another key mitigating force within our property risks.
Block policy means we tend to buy a block rather than one
off properties, giving us more scope to change or get
substantial planning if our type of asset is no longer
lettable. The obvious example is turning redundant
regional offices into residential. In addition, by having a row
of shops, we can increase or reduce the size of retail units
to meet the current requirements of retailers.

Finance risk

The final principal risk, which ties together the other
principal risks and uncertainties, is that if there are severe
adverse market or property risks then these will ultimately
affect our financing, making our lender either force the
Group to sell assets at non-optimal times, or take
possession of the Group’s assets. We describe the above
factors in terms of management, business model and
diversification to help mitigate against property and market
risks which as a consequence mitigate our finance risk.

The main mitigating factor is to maintain conservative
levels of borrowing, or headroom to absorb downward
movements in either valuation or income cover. The other
key mitigating factor, is to maintain strong, honest and
open relationships with our lenders and good relationships
with their key competitors. This means that if issues arise,
there will be enough goodwill for the Group to stay in
control and for the issues to resolve themselves and
hopefully save the situation. As a Group we also hold
uncharged properties and cash resources, which can be
used to rectify any breaches of covenants.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

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

Risk

Reputation

Impact

Action taken to mitigate

Ability to raise capital/deal flow
reduced

Act honourably, invest well and be prudent.

Regulatory changes

Transactional and holding costs
increase

Seek high returns to cover additional costs.
Lobby Government – “Ramblings”. Use advisers when necessary.

People related issues

Loss of key employees/low
morale/ inadequate skills

Computer failure

Loss of data, debtor history

Asset management

Wrong asset mix, asset
illiquidity, hold cash

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.

Draw on wealth of experience to ensure balance between
income producing and development opportunities. Continued
spread of tenancies and geographical
location. Prepare
business for the economic cycles.

Acts of God
(e.g. COVID 19)

Weather incidents, fire,
terrorism, pandemics

Where possible cover with insurance. Ensure you carry
enough reserves and resources to cover any incidents.

Subsequent to the year end an additional risk relating to COVID-19 has been added. The Group’s strategy for dealing with
this risk is set out on page 15.

Section 172(1) statement
This is a reporting requirement and relates to companies
defined as large by the Companies Act 2006, this includes
public companies as otherwise the Group would not be
considered large.

Each individual Director must act in the way he considers,
in good faith, would be the most likely to promote the
success of the company for benefit of its members as a
whole, and in doing so the Directors have had regard to
the matters set out in section 172(1) (a) to (f) when
performing their duty under section 172.

The matters set out are:

(a)

the likely consequences of any decision in the
long term;

The longer term decisions are made at board level
ensuring a wealth of experience and a breadth of skills. The
value creation in the business is mainly generated by
buying the investments at the right time in the financial
cycles, whilst reducing risk by choosing assets that have
alternative or back up values to the current use, as well as
initial values. It is also key that long term decisions are

made in respect of ensuring that property assets are
maintained, where economically viable. Other areas to
ensure decisions are in tune with long term consideration
are making sure the best possible financing of the Group
to match the requirements of the long-term nature of
property ownership. The board and management makes
long term decisions such as keeping a vigilant review of the
changing nature of property usage and tries were possible
to diversify its income streams. Caerphilly and Gateshead
purchases in 2019 are good examples of long term
decision making, i.e. choosing offices and a leisure led
retail scheme – as such giving some protection against
changing consumer habits in more general retail arena.

(b)

the interests of the company’s employees;

The company makes investment in and the development
of talent of its employees, including paying for professional
development, providing in house updates and encouraging
knowledge sharing. The Group has a strong track record
of promoting from within the business and after the 2019
year end two surveyors were promoted to Joint Head of
Property. The Group undertakes team building activities to
encourage cohesion and working together.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Group Strategic Report continued

(c)

the need to foster the company’s business
relationships with suppliers, customers and others;

(f)

the need to act fairly as between members of the
company.

The Group has excellent communication with its
members, actively encouraging participation and
discussion at its AGMs and also circulating letters of our
announcements to ensure older members or those not
accessing the LSE financial news can keep up to date with
relevant information. Our CEO and Chairman is unpaid, his
benefit or income from the company is pro-rata the same
as all members including minority shareholders.

The Group Strategic Report set out on the above pages,
also includes the Chairman’s Statement shown earlier in
these accounts and was approved and authorised for
issue by the Board and signed on its behalf by:

S. J. Peters
Company Secretary

Unicorn House
Station Close
Potters Bar
Hertfordshire EN6 1TL

14 May 2020

Being in the secondary property industry the business is
used to dealing with many types of businesses as tenants
from large multi-national businesses to small sole traders
– keeping good sound relationships with both is key. We
also use many small operators and suppliers and we
ensure prompt payment, paying within 30 days in
most instances to again foster good working relations. We
set a purchase order system in 2018 and refined it in
2019 to streamline and speed up payments supporting
small suppliers.

(d)

the impact of the company’s operations on the
community and the environment;

The Group’s investments by its very nature often have a
significant impact on local communities, providing
services and convenience businesses, or places for local
enterprise or employment. Owning a parade of shops, we
can ensure where possible that these are viable locations
by encouraging a variety of offerings. The Group
maintains and upkeeps its investment properties to a
viable level which benefits the local communities they
provide accommodation for or seeks improvements with
planning which can enhance local areas. The Group also
ensures it recycles much of its head office paper and is
moving towards less paper communication; for instance
2019 was the first year where invoices were emailed as
standard to our tenants and we also encourage the
receipt of electronic invoices. We also ensure we upgrade
our units to the required EPC levels which by its very
nature reduces the longer term environmental impact of
the use of these units.

(e)

the desirability of the company maintaining a
reputation for high standards of business conduct;

The Group maintains an appropriate level of Corporate
Governance that is documented within its own section
within these Financial Statements. With a relatively small
management team it is easier to monitor and assess the
culture and encourage the appropriate standards. The
board strives to delegate and empower its management
teams to ensure the high standards are maintained at all
levels within the business.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Directors’ Report
Company number: 00293147

The Directors submit their report together with the
audited financial statements of the Company and of the
Group for the year ended 31 December 2019.

Directors’ Responsibilities Statement
The Directors are responsible for preparing the Strategic
Report, the Directors’ Report and the financial 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 GAAP)
including FRS101 “Reduced Disclosure 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:

•

select suitable accounting policies and then apply
them consistently;

• make judgements and accounting estimates that are

reasonable and prudent;

•

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

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 taking reasonable
steps for the prevention and detection of fraud and
other irregularities.

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
In addition, the Directors’ Report
Strategic Report.
includes the Group’s objectives, policies and processes
for managing its capital; the Group Strategic Report
includes details of
risk management
its financial
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 high 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 country.

The Group has a strong track record of obtaining long
term finance and expects this to continue as it has
supportive lenders. The Group always maintains excellent
relations with its lenders.

The COVID-19 pandemic has provided a much harder set
of circumstances for all businesses. The Directors have
prepared a detailed financial
forecast assuming a
continued “lock down” scenario that demonstrates the
Group is a going concern even if the business effects of
the lock down resulting from the COVID-19 pandemic
continues to December 2021 (further details with the
Strategic Report). This forecast takes account of a level
income from businesses and trades that
of minimal
remain open (even in the lock down e.g. banks and
supermarkets).
It also takes account of the Group’s
extensive cash reserves (and available facility – some
already drawn at the announcement date) and shows the
Group has enough financial resources to survive to
beyond December 2021 – even with the current lock
down and its effects continuing.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Directors’ Report continued

The Directors are aware that the Group’s loan is up for
renewal in April 2021, however the Directors are confident
that the Group has strong relationships with its lenders
and that even if the Group cannot renew for a full term it
should be able to get a short term renewal to tide it over.
The Group has further protection as the forecast does not
take account of any cost saving potential in 2020.

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 the
foreseeable future, even with the current COVID-19
situation. 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 the Group consists of investment
and dealing in property and securities.

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

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.

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 loss for the year after taxation, amounted to
£4,093,000 (2018: a profit of £7,047,000).

The interim dividend of £1,061,000 (6.0p per share) on
ordinary shares was paid on 28 November 2019. The
Directors recommend a final dividend of £1,061,000 (6.0p
per share) payable on 7 September 2020 to shareholders
on the register at the close of business 7 August 2020 (Ex
dividend on 6 August 2020). The total dividend for the
year ended 31 December 2019 being anticipated at 12p
per share.

There will be no option of a scrip dividend offered for the
2019 final dividend of 6.0p per share (to be paid in
September 2020). There was no scrip option for the
interim dividend in November 2019.

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

interests in

Ordinary shares
of £0.25 each

2019

2018

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

4,244,360
338,669
22,000
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 (2018 – 8,405,175).

There have been no changes in Directors’ shareholdings
since 31 December 2019.

No beneficial interest 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.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Directors’ Report continued

Directors’ emoluments
Directors’ emoluments of £221,000 (2018 – £285,000) are made up as follows:

Director

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

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

Salary/
Fees
£’000

Bonus
£’000

Pension
Taxable
Benefit Contribution
£’000

£’000

–
63
102

10
10

185

–
5
10

–
–

6
2
8

–
–

–
2
3

–
–

Total
2019
£’000

6
72
123

10
10

221

Total
2018
£’000

3
83
163

18
18

285

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 2019 and does not
anticipate making further contributions.

S. J. Peters had pension contributions paid in the year by
the Company of £3,000 (2018 – £21,000) into his personal
stakeholders’ contribution pension scheme. S. J. Peters
and J.H. Perloff also received a contribution into a
stakeholder’s pension fund following auto-enrolment at
the statutory rate of a 2% contribution up to 31 March
2019 and 3% thereafter of their gross salary by the
Company. S. J. Peters did not contribute from April 2019
for the remainder of the year.

No other payments were paid in respect of any other
Director during the year (2018 – £nil).

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

Donations
During the year the Group made a £nil political donation
(2018 – £nil). The Group makes donations to charities
through advertisements at charity events and in the
diaries of charities, the total of which in 2019 was £5,000
(2018 – £10,000). The Group is a Foundation Partner of
the preferred charity of the property industry, Land Aid,
donating £nil (2018 – £10,000).

Status
Panther Securities P.L.C. is a Company quoted on AIM and
is incorporated in England and Wales.

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

Events after the reporting date
Details of events after the report date are given
in the Chairman’s Statement and note 33 to the
consolidated accounts.

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.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Directors’ Report continued

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

–

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

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.

Following a tender process Crowe U.K. LLP will be
appointed at the Annual General Meeting and Nexia Smith
& Williamson’s term of office will end. A specific resolution
to appoint the new auditors, Crowe U.K. LLP, has been
proposed within the resolutions detailed at the back of
these Financial Reports.

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

S. J. Peters
Company Secretary

Unicorn House
Station Close
Potters Bar
Hertfordshire EN6 1TL

14 May 2020

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Corporate Governance

The Board
The Board currently consists of five 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 55 years’ experience in the property sector,
including over 45 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 six other public listed
companies. He is currently a non-executive director of
Airsprung Group PLC as well as Anglia Home Furnishings
Ltd and was previously a director of Beale 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
Airsprung Group PLC as well as Anglia Home Furnishings
Ltd and was previously a director of Beale Ltd (including
when it was fully listed on the LSE). He joined Panther in
2004 and was appointed Finance 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
formerly joint Managing Director of Amalgamated
Investment and Property Co. Limited and was previously a
Non-executive Director of Rugby Estates Investment
Trust Plc.

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.

QCA Corporate Governance Code
The Directors recognise the importance of good
corporate governance and have chosen to adopt and
apply the Quoted Companies Alliance’s 2018 Corporate
Governance Code (the ‘QCA Code’). The QCA Code was
developed by the Quoted Companies Alliance in
consultation with a number of significant institutional small
company investors, as an alternative corporate
governance code applicable to AIM companies. The
underlying principle of the QCA Code is that “the purpose
of good corporate governance is to ensure that the
company is managed in an efficient, effective and
entrepreneurial manner for the benefit of all shareholders
over the longer term”. Details of how the Company
addresses the key governance principles defined in the
QCA Code can be found below.

Establish a strategy and business model which
promote long-term value for shareholders

Panther’s strategy and business model are set out in the
Group Strategic Report. The strategic objective section
of the Group Strategic Report states that the primary

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Corporate Governance continued

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. The key challenges to the business
and how these are mitigated are also detailed in the Group
Strategic Report.

2. Seek to understand and meet shareholder needs

and expectations

The Board strongly encourages good communication
with investors. The Company sends out announcements
via post to shareholders who have requested this and all
shareholders can join our mailing list, even if they hold
shares in CREST.

The person at the Company with principal responsibility
for liaising with shareholders is: Andrew Perloff, Chairman.
Shareholders may also contact the Company in writing
via the following email address: info@pantherplc.com.
Inquiries that are received will be directed to the
Chairman if appropriate, who will consider a response.
The Company may exercise discretion as to which
shareholder questions shall be responded to, and the
information used to answer questions will be information
that is freely available in the public domain. If deemed
necessary, the inquiries will be brought to the Board’s
attention. All shareholders are ordinarily invited to our
Annual General Meeting. Board members are available by
phone to discuss the company and there is also
shareholders access, before, during and after Annual
General Meetings for discussions, therefore providing
lots of opportunities for shareholders to understand and
address any issues.

The Board has historically approved a regular dividend for
many years, which has always been maintained or
increased. The Board aims to maintain a sustainable and
appropriate level of dividend cover. Where exceptional
years arise, the Board anticipates this will normally be
reflected with special dividends where practicable.

The Board believes the Company’s mode of engaging with
shareholders is adequate and effective.

3. Take into account wider stakeholder and social
responsibilities and their implications for long-
term success

The Group is aware of its corporate social responsibilities
and recognises the importance of maintaining effective
working relationships across a range of stakeholder groups.

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On the basis of the Directors’ knowledge and long
experience of the operation of the Group, the Board
recognises that the long-term success of the Group is
reliant upon the efforts of the following key resources and
relationships: the Group’s employees, tenants, lenders,
regulatory authorities, local residents and the general
public affected by our activities. The Company actively
seeks employees’ feedback on their employment with the
Company. The Company does this on an ongoing basis,
but also holds bi-weekly all party staff meetings where
employees are able to provide feedback. The property and
finance departments frequently liaise with tenants, which
can include receiving tenant feedback. The Company’s
lenders have teams of account and relationship managers,
which the Company communicates with on a regular basis
and provides regular management updates and is able to
receive any feedback from lenders. The Company is open
to feedback from local residents and the general public
that may be affected by our activities and, in particular, this
is often part of the planning process.

The Group understands the necessity of balancing the
needs of all our stakeholder groups while maintaining
focus on the Board’s primary responsibility to promote the
success of the Group for the benefit of its members
as a whole.

The Group ensures compliance with regulatory bodies and
legislation through various procedures and protocols and
receives feedback on matters such as planning on a regular
basis. The Group undertakes to resolve any feedback
received from stakeholders where appropriate and where
such amendments are consistent with the Group’s longer
term strategy. However, no material changes to the
Company’s working processes have been required over the
year to 31 December 2019, or more recently, as a result of
stakeholder feedback received by the Company.

Embed effective risk management, considering
both opportunities and threats, throughout the
organization

The Board’s discussion on risk management as described
in the disclosure above in respect of Principle One and in
the Group Strategic Report, which detail risks to the
business and how these are mitigated. The Groups
internal controls are designed to manage rather than
eliminate risk and provide reasonable assurance against
fraud, material misstatement or loss.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Corporate Governance continued

The Board seeks to ensure that the correct and necessary
level of insurance is in place to cover certain aspects of
risks including actions taken against the Directors, as well
as all the properties we own. The insured values and types
of cover are carefully reviewed periodically and this is a
requirement of our main loan agreement.

A commentary on how the Company reviews its internal
controls can be found in the disclosure regarding Principle
Nine below.

5. Maintain the Board as a well-functioning, balanced

team led by the Chair

The Board consist of three Executive Directors and two
Non-Executive Directors. Biographies of the directors can
be found above, the Board considers its two non-
executive Directors (Bryan Galan and Peter Kellner) to be
independent. Bryan Galan and Peter Kellner have been
directors of the Company since 1994. Despite the length
of service of the independent non-executive directors,
the rest of the Board consider them to continue to be
independent as they are sufficiently removed from the
day to day operations of the Company to retain a
critical and independent view. Further commentary in
respect of the Company’s Non-Executive Directors can
be found above.

As detailed above, the Board met three times with all
members present, the Audit Committee met three times
with all members present and the Remuneration
Committee met three times with all members present.
Andrew Perloff, Simon Peters and John Perloff work full
time. Bryan Galan and Peter Kellner currently work on
average 6 days per year.

All Directors are kept apprised of financial and operational
information in a timely fashion and in advance of any
meetings. The Executive Directors regularly attend
meetings to ensure decisions are made and inter-
departmental communication is strong and transparent.

Ensure that between them, the directors have the
necessary up-to-date experience, skills and
capabilities

The Company has an Executive Chairman who is also the
Chief Executive, being Andrew Perloff. The Company’s
Finance Director is Simon Peters. John Perloff is an
Executive Director. Bryan Galan and Peter Kellner are
Non-Executive Directors. Biographies of the directors
are above.

The Board has a wide and well-rounded level of expertise
and experience with a clear and proven track record.
Professionally qualified members of the Board keep up to
date with their Continuing Professional Development,
which ensures they are familiar with changes and current
developments in their fields and some members are on
other boards which helps them see best practise
elsewhere. The Board Members take particular interests in
keeping appraised on key issues and developments
pertaining to the Group.

During the year ended 31 December 2019, neither the
Board nor any committee has sought external advice on
a significant matter and no external advisers to the Board
or any of its committees have been engaged.

Aside from the directors’ stated roles and the role of
Simon Peters as Company Secretary, the Board members
do have any particular internal advisory responsibilities.

Evaluate Board performance based on clear
and relevant objectives, seeking continuous
improvement

The individual Board members are appraised by the
Chairman and/or Non-Executives as appropriate on their
performance. This process is informal in nature and is
performed on an ongoing basis, rather than at pre-
determined annual junctures. The main criteria against
which individual director effectiveness is considered are:
ensuring that the right actions in the business are being
taken and ensuring that directors continue to be effective.
The Company’s director evaluation process has not
changed materially relative to previous years, on the basis
that the Board are of the view that the above processes
are appropriate for the Company’s requirements, given
the nature of the Company’s business and levels of
experience on the Board. There were no material findings
from the Company’s Board appraisals over the year
ended 31 December 2019, which was the same in the
previous year.

All of the Directors are periodically subject to re-election
on a rotation basis at the Annual General Meeting.

The Company does not currently have a periodic appraisal
process for the effectiveness of the Board as a whole nor
for the effectiveness of the committees (and this has not
changed over previous years).

The Board considers succession planning and the need
for further board or senior management appointments.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Corporate Governance continued

The Board believes that there is no need for changes to
the current board, management and committee
structures and membership in order to meet the needs of
the Company’s current and medium-term requirements.
Regarding longer term succession planning, the Board
currently comprises a good spread of ages which provides
a natural succession buffer.

Promote a corporate culture that is based on
ethical values and behaviours

The Board promotes a corporate culture of professional
behaviour, integrity, professional competence and due
care, objectivity and confidentiality. These values are
promoted from the top down and embedded in our
working practices and company policies. As noted in the
disclosure above in respect of Principle Three, the
Company holds bi-weekly all party staff meetings where
employees are able provide feedback, which allows the
Board and management to have insights into the
Company’s culture.

When new employees join the Company, they are
provided a staff handbook and are required to become
familiarised with the Company’s working practices and
company policies. The Board and management are
prepared to take appropriate action against unethical
behaviour, violation of company policies or misconduct.

9. Maintain governance structures and processes
that are fit for purpose and support good decision-
making by the Board

The Board is satisfied with the Company’s corporate
governance, given the Company’s size and the nature of
its operations, and as such there are no specific plans for
any material changes to the Company’s corporate
governance arrangements in the shorter term.

As noted in the disclosure above in respect of Principle Six,
Andrew Perloff is both Chairman and Chief Executive
Officer of the Company. In his role as Chairman, Andrew
Perloff has overall responsibility for corporate governance
matters in the Company, leadership of the board and
ensuring its effectiveness on all aspects of its role. In his
role as Chief Executive Officer Andrew Perloff leads the
Company’s staff and is responsible for implementing
those actions required to deliver on the agreed strategy.
Andrew Perloff and his family trusts are the beneficiaries
of the majority of the Company’s ordinary shares. Andrew
Perloff is one of the original co-founders of the Panther
Securities property investment business and has been a

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significant driving force underlying the Group’s
development. On this basis, the Board considers that it
remains in the best interests of the Group to maintain
Andrew Perloff’s positions as both Chairman and Chief
Executive Officer (a position that he has held for a number
of years), notwithstanding that this is contrary to
recommended best practice in the QCA Code. Feedback
received from shareholders has been positive on
this point.

The Executive Directors have a responsibility for the
operational management of the Group’s activities. The
Non-executive Directors provide independent and
objective insight and judgement to Board decisions. The
Board has overall responsibility for promoting the success
of the Group.

The Board has established an Audit Committee and a
Remuneration Committee comprised only of our Non-
Executive Directors to provide a level of independence
and objectivity.

Audit Committee

The Audit Committee consists solely of the two non-
executive Directors and it is chaired by Peter Kellner. Its
terms of reference 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. Over the year to 31
December 2019 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. Its terms of reference are that 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 the year to 31 December 2019 the Committee met
three times with all members present.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Corporate Governance continued

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, however some directors are incentivised by
their personal holdings in the Company. The only element
of remuneration that reflects specific performance is the
bonuses, however this is adjusted to reflect market
conditions and company results.

The Company does not have a Nomination Committee,
as the need for appointments and decisions regarding
appointments are considered by the Board as a whole.

The key matters reserved for the Board are the following:

•

Strategy

Structure and capital

Financial reporting and controls

Internal controls

Significant investments

Board membership and other appointments

Delegation of authority

Corporate governance

Approval of company policies

Other matters, such key adviser appointments and
insurance

10. Communicate how the Group is governed and is
performing by maintaining a dialogue with
shareholders and other relevant stakeholders

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 ordinarily
encouraged to attend the Annual General Meeting (please
note the next AGM no shareholders will be invited due to
COVID-19 situation but will be encouraged to use their
Proxy forms), 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.

The Board recognises the importance of communication
with the Group’s shareholders and various stakeholders.
The Group updates its website regularly with any
announcements and always welcomes shareholders’
queries which are welcomed by all members of the Board
whenever they arise.

The Annual General Meeting also provides an important
opportunity to meet shareholders. The Board has hot
drinks before and after the Annual General Meeting where
dialogue is encouraged.

The detailed results of voting on all resolutions in future
general meetings will not be posted to the Group’s
website or announced, as the Board feels that these
results have in recent years been unambiguous and
generally unanimous.

Where a significant proportion of votes (e.g. 20% of
independent votes) have been cast against a resolution at
any general meeting, the Board will post this on the
Group’s website and will include, on a timely basis, an
explanation of what actions it intends to take to
understand the reasons behind that vote result, and,
where appropriate, any different action it has taken, or will
take, as a result of the vote.

The Group’s financial reports for the last five years can
be found online: http://www.pantherplc.com/financial/
reports-and-accounts/

Notices of Annual General Meetings of the Company for
the last five years are included at the end of each of the
annual report and financial statements. Within the last five
years, other than its Annual General Meetings, the
Company has not held and other General Meetings of
Shareholders.

Certain details regarding the Company’s Audit Committee
and Remuneration Committee and their work over the
year to 31 December 2019 can be found in the disclosure
above in respect of Principle Nine. The Company’s Audit
Committee and Remuneration Committee do not
produce public reports on their work over the year,
although their work and key findings are communicated to
the Board. Details of the Company’s remuneration policy
can be found in the disclosure above in respect of Principle
Nine and details of the Directors’ remuneration can be
found above in the Directors’ Report.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Independent Auditors’ Report
To the Members of Panther Securities PLC

Opinion
We have audited the Group financial statements of
Panther Securities PLC (‘the Group’) for the year ended
31 December 2019 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 and the Notes to the Consolidated Accounts,
including a summary of significant accounting policies.
The financial reporting framework that has been applied
in their preparation is applicable law and International
Financial Reporting Standards (IFRSs) as adopted by the
European Union.

In our opinion, the Group financial statements:

•

give a true and fair view of the state of the Group’s
affairs as at 31 December 2019 and of its loss for the
year then ended;

have been properly prepared in accordance with
IFRSs as adopted by the European Union; and

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

Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit of
the Group financial statements section of our report. We
are independent of the Group in accordance with the
ethical requirements that are relevant to our audit of the
Group financial statements in the UK, including the FRC’s
Ethical Standard as applied to SME listed entities, and we
responsibilities in
have fulfilled our other ethical
accordance with these requirements. We believe that the
audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.

Conclusions relating to going concern
We have nothing to report in respect of the following
matters in relation to which the ISAs (UK) require us to
report to you where:

•

the Directors’ use of the going concern basis of
accounting in the preparation of the Group financial
statements is not appropriate; or

any

statements

the Directors have not disclosed in the Group
identified material
financial
uncertainties that may cast significant doubt about
the Group’s ability to continue to adopt the going
concern basis of accounting for a period of at least
twelve months from the date when the Group
financial statements are authorised for issue.

Emphasis of matter – Impact of COVID-19
We draw attention to note 4 of the financial statements,
which describes the impact of COVID-19 and the
refinancing of debt facilities on the Group. Our opinion is
not modified in respect of this matter.

Key audit matters
We identified the key audit matters described below as
those that were of most significance in the audit of the
financial statements of the current period. Key audit
matters include the most significant assessed risks of
material misstatement, including those risks that had the
greatest effect on our overall audit strategy, the allocation
of resources in the audit and the direction of the efforts
of the audit team.

In addressing these matters, we have performed the
procedures below which were designed to address the
matters in the context of the financial statements as a
whole and in forming our opinion thereon. Consequently,
we do not provide a separate opinion on these
individual matters.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Independent Auditors’ Report continued

Key audit matter Description of risk

How the matter was addressed in the audit

Valuation of
investment
properties
(Group)

We confirmed that the valuation approach was
suitable for use in determining the carrying value
for the purpose of the financial statements.

We attended a meeting with management, the
Valuers and the non-executive directors to
consider the draft valuation.

We assessed the Valuers’ qualifications and
expertise to determine whether there were any
matters that might have affected their
objectivity or may have imposed scope
limitations upon their work.

We tested a sample of current rents receivable
per the valuation for consistency with the
Group’s tenant ledger. The tenant ledger
data was subject to separate sample testing
to ensure that the records within the system
are consistent with the underlying lease
documentation.

We compared sale prices to the previous
valuations to understand whether the sale price
provides evidence of fair value or reflects
factors specific to the sale and not the
general market.

We analysed the individual property valuations
to understand significant movements against
prior year and comparative market evidence.
Our work focused on the highest value
properties in the portfolio and those where the
assumptions used suggested a possible outlier
versus market data for the relevant sector.

The valuation of the Group’s investment
property portfolio is inherently subjective due
to, among other factors, the individual nature of
each property, its location and the expected
future rentals for that particular property.

The valuations were carried out by the Directors
Institute of Chartered
supported by Royal
Surveyors
employees
qualified
(‘RICS’)
in accordance with RICS
(“the Valuers”)
Professional Standards.

In determining a property’s valuation the
Valuers take into account property-specific
information such as the current tenancy
agreements and rental
income. They apply
assumptions for yields and estimated market
rent, which are influenced by prevailing
market
and comparable market
transactions, to arrive at the final valuation. For
developments, the residual appraisal method is
used, by estimating the fair value of the
completed project using a capitalisation
method less estimated costs to completion and
a risk premium.

yields

The significance of
the estimates and
judgements involved, coupled with the fact that
only a small percentage difference in individual
property valuations, when aggregated, could
result in a material misstatement, warrants
specific audit focus in this area.

The Group’s accounting policy for investment
properties is included within note 4. Details of
the Groups valuation methodology and
resulting valuation can be found in note 16.

As discussed in note 33 to the financial
statements, the impact of the COVID-19
pandemic on the valuation of the Group’s
investment properties is considered a non-
adjusting subsequent event. There is therefore
uncertainty over the future impact on the
valuation of the group’s investment properties,
which at the date of this report has not been
quantified.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Independent Auditors’ Report continued

Key audit matter Description of risk

How the matter was addressed in the audit

Valuation of
derivative
financial
instruments
(Group and
Company)

Revenue
recognition
(Group)

We gained an understanding of the Group’s
methodology in respect of determining the fair
value as at the Statement of Financial Position
date and assessed compliance with the
requirements of relevant accounting standards.

We used external experts to compute an
independent estimate of fair value as at the
Statement of Financial Position date.

We considered the disclosures in the financial
statements in respect of swaps outstanding as
at the reporting date.

In testing revenue recognition we have:

•

performed detailed substantive testing of a
sample transactions, including agreement
and
documentation
to
recalculation of income deferral; and

supporting

agreed a sample of accrued income
balances, arising as a result of occupier
incentives, guaranteed rent increases or
profit or turnover estimation to supporting
documentation and recalculated the
income accrual.

The Group has entered into three interest rate
swaps (‘swaps’) which are carried at fair value
through profit and loss. Assessing the fair value
of the swaps is inherently subjective as the
Group uses its judgement to select suitable
valuation techniques and make assumptions
which are mainly based on market conditions
existing at the reporting date.

The Group benchmarks its valuations against
those provided by the counterparty bank and a
third party bank.

The Group’s accounting policy for derivative
financial instruments is included within note 4.
Details of the Group’s derivative financial
instruments can be found in note 29.

Revenue for the Group consists primarily of
rental income.

Revenue growth is a key performance indicator
of the Group. Revenue expectations may place
pressure on management to distort revenue
recognition. This may result in overstatement
or deferral of revenues to assist in meeting
current or future targets or expectations.

These include spreading of occupier incentives
and guaranteed rent
increases as these
balances require adjustments made to rental
income to ensure revenue is recorded on a
straight-line basis over the course of a lease,
coupled with turnover and profit rents which
require the use of estimates.

The Group’s accounting policy for revenue
recognition is included within note 4.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Independent Auditors’ Report continued

Materiality
The materiality for the Group financial statements as a
whole was set at £5,638,000. This has been determined
with reference to the benchmark of the Group’s total
assets, which we consider to be one of the principal
considerations for members of the Parent Company in
assessing the performance of the Group. Materiality
represents 3% of the total assets as presented on the
face of the Consolidated Statement of Financial Position.

The materiality for the Parent Company financial
statements as a whole was set at £3,664,700. This has
been determined with reference to the benchmark of the
Parent Company’s total assets as the Parent Company
exists only as a holding company for the Group and carries
on no trade in its own right. Materiality represents 2.9% of
total assets as presented on the face of the Parent
Company’s Statement of Financial Position.

A number of key performance indicators of the Group are
driven by Income Statement items and we therefore
applied a lower specific materiality of £293,300, based on
2% of Group revenue. This lower specific materiality was
applied to the components of the Group and Parent
Company’s Income Statement, excluding investment
property valuation movements and fair value movements
on derivative financial instruments.

An overview of the scope of our audit
Of the Group’s 26 reporting components, we subjected
all to audits for Group reporting purposes.

The components within the scope of our work covered
100% of Group revenue, Group profit before tax and
Group net assets. The Group audit team visited one
location in the UK covering the 26 components that were
subjected to audit.

Other information
The other information comprises the information included
in the Annual Report and Financial Statements, other than
the Group and Parent Company financial statements and
our auditor’s reports thereon. The Directors are
responsible for the other information. Our opinion on the
Group financial statements does not cover the other
information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of
assurance conclusion thereon.

In connection with our audit of the Group financial
statements, our responsibility is to read the other
information and, in doing so, consider whether the other
information is materially inconsistent with the Group
financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If
inconsistencies or apparent
we identify such material
material misstatements, we are required to determine
whether there is a material misstatement in the Group
financial statements or a material misstatement of the
If, based on the work we have
other information.
performed, we conclude that there is a material
misstatement of this other information, we are required
to report that fact.

We have nothing to report in this regard.

Opinion on other matters prescribed by the
Companies Act 2006
In our opinion, based on the work undertaken in the course
of the audit:

•

the information given in the Group Strategic Report
and the Directors’ Report for the financial year for
which the Group financial statements are prepared is
consistent with the Group financial statements; and

the Group Strategic Report and the Directors’ Report
have been prepared in accordance with applicable
legal requirements.

Matters on which we are required to report by
exception
In the light of the knowledge and understanding of the
Group and its environment obtained in the course of the
audit, we have not identified material misstatements in the
Group Strategic Report or the Directors’ Report.

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:

•

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

remuneration

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

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Independent Auditors’ Report continued

Responsibilities of Directors
As explained more fully in the Directors’ responsibilities
statement set out on page 20, the Directors are
responsible for the preparation of the Group financial
statements and for being satisfied that they give a true
and fair view, and for such internal control as the directors
determine is necessary to enable the preparation of
Group financial statements that are free from material
misstatement, whether due to fraud or error.

In preparing the Group financial statements, the Directors
are responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going
concern basis of accounting unless the Directors either
intend to liquidate the Group or to cease operations, or
have no realistic alternative but to do so.

Other matter
We have reported separately on the Parent Company’s
financial statements of Panther Securities PLC for the
year ended 31 December 2019.

Use of our report
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.

Auditor’s responsibilities for the audit of the
Group financial statements
Our objectives are to obtain reasonable assurance about
whether the Group financial statements as a whole are
free from material misstatement, whether due to fraud or
error, and to issue an auditor’s report that includes our
opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise
from fraud or error and are considered material
if,
individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users
taken on the basis of these Group financial statements.

A further description of our responsibilities for the
audit of the Group financial statements is located
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.

Jacqueline Oakes
Senior Statutory Auditor,
for and on behalf of
Nexia Smith & Williamson

25 Moorgate
London
EC2R 6AY

Statutory Auditor
Chartered Accountants

14 May 2020

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Consolidated Income Statement
For the year ended 31 December 2019

Revenue
Cost of sales

Gross profit

Other income
Administrative expenses
Bad debt expense

Operating profit

Profit on disposal of investment properties
Movement in fair value of investment properties

Finance costs – interest
Finance costs – swap interest
Investment income
Loss on disposal of fixed assets
Profit (realised) on the disposal of investments
Fair value (loss)/gain on derivative financial liabilities

(Loss)/profit before income tax

Income tax income/(expense)

(Loss)/profit for the year

Continuing operations attributable to:
Equity holders of the parent

(Loss)/profit for the year

(Loss)/earnings per share
Basic and diluted – continuing operations

31 December
2019
£’000

31 December
2018
£’000

Notes

5
5

10
10
9

14,226
(3,429)

10,797

443
(1,676)
(524)

9,040

515
(8,832)

723

(2,469)
(2,437)
112
–
105
(997)

(4,963)

870

(4,093)

13,607
(3,947)

9,660

457
(1,819)
(796)

7,502

11,750
(6,396)

12,856

(2,526)
(2,533)
24
(41)
34
886

8,700

(1,653)

7,047

(23.1)p

39.9p

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Consolidated Statement of Comprehensive Income
For the year ended 31 December 2019

(Loss)/profit for the year

31 December
2019
£’000

31 December
2018
£’000

Notes

(4,093)

7,047

Items that will not be reclassified subsequently to profit or loss
Movement in fair value of investments taken to equity
Deferred tax relating to movement in fair value of
investments taken to equity
Realised fair value on disposal of investments previously taken to equity
Realised deferred tax relating to disposal of investments
previously taken to equity

27
18

Other comprehensive loss for the year, net of tax

Total comprehensive (loss)/income for the year

Attributable to:
Equity holders of the parent

(225)

(197)

38
48

(8)

(147)

(4,240)

34
–

–

(163)

6,884

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Consolidated Statement of Financial Position
Company number 00293147
As at 31 December 2019

ASSETS
Non-current assets
Investment properties
Deferred tax asset
Right of use asset
Investments

Current assets
Stock properties
Investments
Current tax asset
Trade and other receivables
Cash and cash equivalents (restricted)
Cash and cash equivalents

Total assets

EQUITY AND LIABILITIES
Capital and reserves
Share capital
Share premium account
Treasury shares
Capital redemption reserve
Retained earnings

Total equity

Non-current liabilities
Long-term borrowings
Derivative financial liability
Leases

Current liabilities
Trade and other payables
Short-term borrowings
Current tax payable

Total liabilities

Total equity and liabilities

31 December
2019
£’000

31 December
2018
£’000

Notes

16
27

19
20

22
23
23

24
25
25
25

26
29
31

28
26

169,340
3,304
373
927

173,944

350
168
601
3,389
2,299
7,186

13,993

187,937

4,437
5,491
(213)
604
74,627

84,946

58,955
26,511
7,912

93,378

8,541
1,072
–

9,613

102,991

187,937

170,236
1,811
–
1,850

173,897

448
–
–
4,896
14,436
5,614

25,394

199,291

4,437
5,491
(213)
604
83,710

94,029

58,864
25,514
7,510

91,888

10,192
1,071
2,111

13,374

105,262

199,291

The accounts were approved by the Board of Directors and authorised for issue on 14 May 2020. They were signed on
its behalf by:

A.S. Perloff
Chairman

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Consolidated Statement of Changes in Equity
For the year ended 31 December 2019

Balance at 1 January 2018
Total comprehensive income
Dividends

Balance at 1 January 2019
Total comprehensive loss
Other movement
Dividends

Share
capital
£’000

4,437
–
–

4,437
–

5,491
–
–

5,491
–

–

Share
premium
£’000

Treasury
shares
£’000

Capital
redemption
£’000

Retained
earnings
£’000

Total

£’000

91,212
6,884
(4,067)

94,029
(4,240)
(68)
(4,775)

(213)
–
–

(213)
–

–

(213)

604
–
–

604
–

–

604

80,893
6,884
(4,067)

83,710
(4,240)
(68)
(4,775)

Balance at 31 December 2019

4,437

5,491

74,627

84,946

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Consolidated Statement of Cash Flows
For the year ended 31 December 2019

Cash flows from operating activities
Operating profit
Depreciation charges for the year
Loss on current asset investments
Transfer stock to investment properties
Rent paid treated as interest

Profit before working capital change

Increase in stock investments
Decrease/(increase) in receivables
Decrease in payables

Cash generated from operations

Interest paid
Income tax paid

Net cash generated from/(used in) operating activities

Cash flows from investing activities
Purchase of investment properties
Purchase of investments**
Purchase of current asset investments***
Proceeds of current asset investments***
Proceeds from sale of investment property
Proceeds from sale of investments**
Dividend income received
Interest income received

Net cash (used in)/generated from investing activities

Cash flows from financing activities
Repayments of loans
Loan arrangement fees and associated costs
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*

31 December
2019
£’000

31 December
2018
£’000

9,040
–
15
(141)
(651)

8,263

(168)
1,507
(1,802)

7,800

(4,091)
(3,303)

406

(8,138)
–
(3,996)
3,981
1,065
851
76
36

(6,125)

(1,071)
–
1,000
(4,775)

(4,846)

(10,566)
20,050

9,485

7,502
13
–
–
(571)

6,944

–
(1,219)
(319)

5,406

(4,375)
(2,743)

(1,712)

(3,894)
(2,271)
–
–
40,790
275
5
19

34,924

(15,161)
(375)
500
(4,067)

(19,103)

14,109
5,941

20,050

* Of this balance £2,299,000 (2018: £14,436,000) is restricted by the Group’s lenders i.e. it can only be used for purchase of investment property.
** Shares in listed and/or unlisted companies.
*** Shares in listed and/or unlisted companies but held for trading purposes.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements
For the year ended 31 December 2019

1. General information
Panther Securities P.L.C. (the “Company”) is a Public Limited Company limited by shares and 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 and Financial Statements. The principal activities of the Company and its subsidiaries (the Group) are
described in the Director’s Report.

2. New and revised International Financial Reporting Standards

New and amended Standards which became effective in the year

The Group has adopted the following new and amended standards:

•

IFRS 16 “Leases” applies for the first time this period. The impact of this standard is shown in Note 35.

In addition to the adoption of IFRS16, the following amendments have been issued and are effective for the first time
impact on these financial statements as a result of the
in this period. However there has been no material
changes introduced:

–

IFRIC 23 “Uncertainty over Income Tax Treatments”

Amendment to IFRS 9: “Prepayment Features with Negative Compensation”

Amendment to IAS 28: “Investments in Associates and Joint Ventures”

Amendment to IAS 19: “Employee Benefits”

Amendments to IFRS 3, IFRS 11, IAS 12 and IAS 23 in “Annual Improvements 2015-2017 cycle”

Standards, interpretations and amendments to published standards that are not yet effective

Amendments to IFRS which will apply in future periods

Amendments have been made to IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in
Accounting Estimates and Errors in relation to the definition of material. The new definition will apply for the first time in
the next financial year. The amendments clarify the definition of what is material to the financial statements and how to
apply the definition.

The amendments will have an impact on the presentation and disclosure in the financial statements. After applying the
new definition, the financial statement may have less disclosures as it may be easier to justify that certain disclosures
are immaterial to users of financial statements. Furthermore, more meaningful disclosures may be presented in a more
prominent manner due to the additional guidance on the effects of obscuring information.

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

3. Critical accounting judgements and key sources of estimation uncertainty
Sources of judgement and estimation uncertainty in respect of the valuation of derivative financial instruments and
investment properties are noted in their accounting policies and respective notes.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. 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 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. The principal accounting
policies are set out below.

The Board have prepared a detailed financial forecast that demonstrates the Group is a going concern even if the
commercial effects of the lock down resulting from the COVID-19 continues to December 2021. This forecast takes
account of a level of minimal income from businesses and trades that currently are allowed to remain open even in the
lock down (e.g. banks, pharmacies and supermarkets). It also takes account of the Group’s extensive cash reserves (and
available facility – note £4m extra has been drawn at the announcement date, with £1m loan repayment made and £1.5m
released from the restricted funds) and shows the Group has enough free financial resources to survive to beyond
December 2021. This forecast is a worst case scenario with the same level of restrictions the government is currently
requesting in place to December 2021. The forecast was very prudent and does not take account of any cost saving
potential in 2020 or the full level of income from businesses that our allowed to be open, which equate to circa 41% of
our rent receivable or £5.6m.

The Directors are aware that the Group’s loan is up for renewal in April 2021, however the Directors are confident that
the Group has strong relationships with its lenders and that even if the Group cannot renew for a full term it should be able
to get a short term renewal to tide it over. The Group has further protection as the forecast does not take account of any
cost saving potential in 2020.

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.

All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

Business combinations

The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured at
the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, consideration
payable including equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly
attributable to the business combination. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet
the conditions for recognition are recognised at their fair values at the acquisition date.

Investment properties

Investment properties, which are properties held to earn rentals and/or capital appreciation, are revalued annually using
the fair value model of accounting for investment property at the Statement of Financial Position date. When revaluing
properties judgements are made 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.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
In accordance with IFRS 16 the Group has taken the practical expedient to not restate leases entered into prior to the date
of transition being 1 January 2019. No new leases have been entered into since this date. Prior to 1 January in accordance
with IAS 17 (‘Leases’) and IAS 40 (‘Investment Property’), a property interest held under an operating lease, which met the
definition of an investment property, was classified as an investment property. The property interest was 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 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.

Investment property disposals are recognised on the date that exchange of contracts become unconditional and there
is a reasonable expectation that completion will occur. At this point the investment property is derecognised and any
difference between consideration received and carrying value is recognised in the Income Statement.

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 the Income Statement. 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.

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 within 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 a net basis. Corporation tax for the period is charged at 19.00%
(2018 – 19.00%).

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
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

IFRS 15 Revenue from Contracts is applicable to management fees and other income but excludes rent receivable. The
majority of the Group’s income is from tenant leases and is outside the scope of the standard. The financial impact of the
standard is considered immaterial and does not materially impact the financial statements.

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, provided
that there is a reasonable expectation that completion will occur.

Other income comprises:

•

Property management fees on service charge managed properties net of Value Added Tax where appropriate.
Income is recognised on an accruals basis when the performance obligations have been met.

Surrender premiums received on the early termination of tenant leases. Income is recognised on the date of
surrender of the lease.

Option premium and extension fees are recognised when the performance obligations are met and their signed
contracts.

Dilapidation fees received but not expensed against repair costs. Income is recognised when the dilapidation fee
has been contractually agreed with the tenant.

Insurance fees not utilised are recognised when we are sure they are not going to be utilised.

The fair value of consideration received or receivable on the above services is recognised when the above revenue can
be reliably measured. Revenue from services is recognised evenly over the period in which the services are provided.

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
Lease property

10% – 33% Straight line
20%
Straight line
Over the life of the lease

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.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
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, it 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.

Financial instruments

Financial assets and financial liabilities are recognised on the Group’s Statement of Financial Position when the Group
becomes party to the contractual provisions of the instrument.

Trade receivables

Trade receivables are initially recognised at the transaction price in accordance with IFRS 15. IFRS 9 requires the Group
to make an assessment of Expected Credit Losses (‘ECLs’) on its debtors based on tenant payment history and the
Directors’ assessment of the future credit risk relating to its trade receivables at reporting dates.

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.

Where new bank financing is obtained on substantially different terms to the existing financing the original financial liability
is derecognised and a new financial liability recognised.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
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. Gains and losses on revaluation exclude interest
expense on derivatives. 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.

Investments

Under IFRS 9, the Group has made an irrevocable election at initial recognition for particular investments in equity
instruments that would otherwise be measured at fair value through profit or less to present subsequent changes through
other comprehensive income, and classified in the Statement of Financial Position as investments. Fair values of these
investments are based on quoted market prices where available. The fair value of the investments in unquoted equity
securities is considered and where it cannot be measured reliably 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 IFRS 9, the impairment losses are recognised in the Income Statement. The 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.

Current asset investments are held for short term trading and are carried at fair value with movements in fair value
recognised in the Income Statement.

Impairment of investments

At each Statement of Financial Position date a provision for impairment is established based on expected credit losses.
If the asset is judged to be impaired the loss is 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.

Share capital

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

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
Share premium

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

Treasury shares

Treasury shares represents the cumulative amounts paid to re-purchase shares in the company.

Capital redemption reserve

The capital redemption reserve arises on the purchase of the Company’s own shares for cancellation.

Retained earnings

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

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.

Leases

Accounting policy applicable before 1 January 2019

Leases were classified as finance leases whenever the terms of the lease transferred substantially all the risks and rewards
of ownership to the lessee. All other leases were classified as operating leases. As set out in the investment properties
accounting policy the Group accounted for operating leases in relation to investment property assets as if they were
finance leases.

Most 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. The sub-lease for the office premises has not been recognised
on the grounds of materiality.

The Group as lessee

Rentals payable under operating leases are charged to the Income Statement on a straight line basis over the term of the
relevant lease. Benefits received or provided 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 treatment of
investment properties held under an operating lease.

Accounting policy applicable after 1 January 2019

IFRS 16 was adopted as of 1 January 2019 without restatement of comparative figures. See note 35 for details of the
transition.

A right of use asset and a lease liability has been recognised for all leases except leases of low value assets, which are
considered to be those with a fair value below £10,000, and those with a duration of 12 months or less. The right-of-use
asset has been measured at cost, which is made up of the initial measurement of the lease liability, any initial direct costs
incurred by the Group, an estimate of any costs to dismantle and remove the asset at the end of the lease, and any lease
payments made in advance of the lease commencement date.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

4. Significant accounting policies continued
The Group will depreciate the right-of-use assets on a straight-line basis from the lease commencement date to the
earlier of the end of the useful life of the right-of-use asset or the end of the lease term. Where impairment indicators
exist, the right of use asset will be assessed for impairment.

The lease liabilities are measured at the present value of the lease payments due to the lessor over the lease term,
discounted using the interest rate implicit in the lease if that rate is readily available or the Group’s incremental borrowing rate.

After initial measurement, any payments made will reduce the liability and the interest accrued will increase it. Any
reassessment or modification will lead to a remeasurement of the liability. In such case, the corresponding adjustment
will be reflected in the right-of-use asset, or profit and loss if the right-of-use asset is already reduced to zero. On the
Statement of Financial Position, right-of-use assets have been capitalised and included as a separate item.

The Group as lessor

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

Other income
Insurance proceeds not utilised
Contract extension fee (disposals)
Service charge management fees
Guarantee fee
Dilapidations and other

6. Operating profit
The operating 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

2019
£’000

145
–
101
–
197

443

2019
£’000

–

103
6

2018
£’000

–
113
99
33
212

457

2018
£’000

87
13

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

7. Staff costs

Staff costs, including Directors’ remuneration, were as follows:
Wages and salaries
Social security costs
Pension contributions

2019
£’000

785
87
12

884

2018
£’000

947
107
33

1,087

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

Directors
Other employees

8. Directors’ remuneration

Emoluments for services as Directors

2019
Number

2018
Number

5
19

2019
£’000

221

5
16

2018
£’000

285

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.

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:

Emoluments for services as directors
Employers’ NIC

Short term employee benefits (salaries and benefits)

Investment income

Interest on bank deposits
Dividends from equity investments

2019
£’000

221
23

244

2019
£’000

36
76

112

2018
£’000

285
36

321

2018
£’000

19
5

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

10. Finance costs

Interest payable on bank overdrafts and loans
Interest payable on lease liabilities

Finance costs – interest
Finance costs – swap interest (on financial derivatives)

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 credit – note 27

Income tax (credit)/expense for the year

2019
£’000

1,818
651

2,469
2,437

4,906

2019
£’000

669
(76)

593
(1,463)

(870)

2018
£’000

1,955
571

2,526
2,533

5,059

2018
£’000

4,684
(71)

4,613
(2,960)

1,653

Domestic income tax is calculated at 19.00% (2018 – 19.00%) of the estimated assessable profit or loss for the year.
The provision for deferred tax has been calculated on the basis of 17.0% (2018 – 17.0%).

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

(Loss)/profit before taxation
(Loss)/profit before tax multiplied by the average
of the standard rate of UK corporation tax
of 19.00% (2018 – 19.00%)
Tax effect of expenses that are not deductible in
determining taxable profit
Dividend income not taxable for tax purposes
Tax on chargeable gains difference to profits
Movement in deferred tax on revalued assets
Difference in current and deferred tax rates
Prior year corporation tax over provision

Tax (credit)/charge

2019
£’000

(4,963)

(943)

53
(14)
(61)
353
(181)
(76)

(870)

2019
%

2018
£’000

8,700

2018
%

19.00

1,653

19.00

(1.1)
0.3
1.2
(7.1)
3.6
1.6

15
(1)
2,010
(1,601)
(352)
(71)

1,653

0.2
–
23.0
(18.4)
(4.0)
(0.8)

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

12. Loss or profit attributable to members of the parent undertaking

Dealt with in the accounts of:
– the parent undertaking
– subsidiary undertakings

Reconciliation of parent company profit and loss

(Loss)/profit of parent company before intercompany adjustments
Bad debt provision – intercompany loan*
Intercompany dividends*

Loss attributable to members of the Parent undertaking

* removed on consolidation

13. Dividends
Amounts recognised as distributions to equity holders in the period:

Special dividend for the year ended 31 December 2018
of 15p per share (2017:10p per share)
Final dividend for the year ended 31 December 2018
of 6p per share (2017: 7p per share)
Interim dividend for the year ended 31 December 2019
of 6p per share (2018: 6p per share)

2019
£’000

(6,271)
2,178

(4,093)

2019
£’000

(8,120)
2,300
(451)

(6,271)

2019
£’000

2,653

1,061

4,775

2018
£’000

(5,283)
12,330

7,047

2018
£’000

22,880
–
(28,163)

(5,283)

2018
£’000

1,768

1,238

1,061

4,067

The Directors recommend a payment of a final dividend for the year ended 31 December 2019 of 6p per share (2018 –
6p), following the interim dividend paid on 28 November 2019 of 6p per share (2018 – 6p). In 2018 a special dividend was
also declared of 15p per share. The final dividend of 6p per share will be payable on 7 September 2020 to shareholders
on the register at the close of business on 7 August 2020 (Ex dividend on 6 August 2020).

The full ordinary dividend for the year ended 31 December 2019 is anticipated to be 12p per share, being the 6p interim
per share paid and the recommended final dividend of 6p per share.

14. (Loss)/earnings per ordinary share (basic and diluted)
The calculation of (loss)/profit per ordinary share is based on the (loss)/profit, being a loss of £4,093,000 (2018 – profit
of £7,047,000) and on 17,683,469 ordinary shares being the weighted average number of ordinary shares in issue during
the year excluding treasury shares (2018 – 17,683,469). There are no potential ordinary shares in existence. The Company
holds 63,460 (2018 – 63,460) ordinary shares in treasury.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

15. Plant and equipment

Cost
At 1 January 2018
Disposals

At 1 January 2019
Disposals

At 31 December 2019

Accumulated depreciation
At 1 January 2018
Depreciation charge for the year
Disposals

At 1 January 2019
Disposals

At 31 December 2019

Carrying amount
At 31 December 2019 and 2018

At 1 January 2018

16. Investment properties

Fair value
At 1 January 2018
Additions
Disposals
Fair value adjustment on property held on operating leases
Revaluation decrease

At 1 January 2019
Additions
Transfer from stock properties
Disposals
Fair value adjustment on investment properties held on leases
Revaluation decrease

At 31 December 2019

Carrying amount
At 31 December 2019

At 31 December 2018

Fixtures and
equipment
£’000

Motor
vehicles
£’000

164
(75)

89
–

110
13
(34)

89
–

–

8
–

8
–
–

8
–

–

Total
£’000

172
(75)

97
–

118
13
(34)

97
–

–

Investment properties
£’000

201,825
3,894
(29,040)
(47)
(6,396)

170,236
8,138
239
(550)
109
(8,832)

169,340

170,236

At 31 December 2019, £130,366,000 (2018 – £129,739,000) and £38,974,000 (2018 – £40,497,000) included within
investment properties relates to freehold and leasehold properties respectively.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

16. Investment properties continued
On the historical cost basis, investment properties would have been included as follows:

Cost of investment properties

2019
£’000

2018
£’000

130,722

123,902

The Group has pledged £152,222,000 (ignoring lease obligations) of investment property (2018 – £154,743,000) as
security for the loan facilities granted to the Group at the Statement of Financial Position date.

Costs relating to ongoing and potential developments are included in additions to investment properties and in the year
ended 31 December 2019 amounted to £378,000 (2018 – £nil).

The property rental income earned by the Group from its investment property, all of which is leased out under operating
leases, amounted to £14,189,000 (2018 – £13,518,000).

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 majority of the portfolio are in the range of 6.5% – 13.0% with the average yield being circa 8.8%.
Assuming all else stayed the same; a decrease of 1.0% in the average yield would result in an increase in fair value of
£20,672,000 (2018: £18,460,000). An increase of 1.0% in the average yield would result in a corresponding decrease in
fair value.

The property valuations were carried out by the directors at 31 December 2019 (also by the directors at December 2018
and GL Hearn in December 2017). The valuation methodology applied by the Directors and GL Hearn is in accordance
with The RICS Valuation Global Standards (effective from July 2017), 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 2019 this was a fair value loss of £8,832,000 (2018 – fair value loss
of £6,396,000). The amount of realised gains or losses is shown as the profit on disposal of investment properties within
the income statement, for 2019 there was a realised gain of £515,000 (2018 – £11,750,000).

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

17. Subsidiaries
Details of the Company’s subsidiaries at 31 December 2019 are as follows;

Name of subsidiary

Panther Trading Limited
Panther (Dover) Limited
Panther Gateshead (VAT) Limited
Panther Shop Investments Limited
Panther Shop Investments (Midlands) Limited
Panther Investment Properties Limited
Panther (Bromley) Limited(*)
Snowbest Limited
Surrey Motors Limited
Westmead Building Company Limited
Multitrust Property Investments Limited
Etonbrook Properties PLC
Northstar Property Investment Limited
Panther (VAT) Properties Limited
Northstar Land Limited
London Property Company PLC
Eurocity Properties PLC
Eurocity Properties (Central) Limited(**)
CJV Properties Limited(**)
Panther AL Limited
Panther AL (VAT) Limited
Melodybright Limited
Panther Hinckley (VAT) Limited
Abbey Mills Properties Limited(***)
Lord Street Properties (Southport) Limited

100% subsidiary of Surrey Motors Limited
** 100% subsidiaries of Eurocity Properties PLC
*** Dissolved post year end

Country of
incorporation
and operation

Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain
Great Britain

Activity

Property
Property
Property
Property
Property
Property
Property
Property
Non-trading
Property
Property
Non-trading
Property
Property
Dormant
Dormant
Property
Property
Property
Property
Property
Property
Property
Non-trading
Property

Proportion
of ownership
interest
%

Proportion
of voting
power held
%

100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
99.99

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

The registered office of all the above companies is Unicorn House, Station Close, Potters Bar, Herts, EN6 1TL.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

18. Investments

Cost or valuation
At 1 January 2018
Additions
Movement in fair value taken to equity
Disposals

At 1 January 2019
Movement in fair value taken to equity
Movement in fair value taken to equity realised on disposal
Disposals

At 31 December 2019

Comprising at 31 December 2019:
At cost
At valuation/net realisable value

Carrying amount
At 31 December 2019

At 31 December 2018

Non-current
assets
£’000

17
2,271
(197)
(241)

1,850
(225)
48
(746)

927

17
910

927

1,850

The 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 securities carried at fair value are classified as Level 1 in the fair
value hierarchy specified in IFRS 13. The fair value of investments in unquoted equity securities, which are not publically
traded, cannot be reliably measured and have therefore been shown at cost. The valuation of the investments is sensitive
to stock exchange conditions.

Price risk

For the year ended 31 December 2019 if the average share price of the portfolio was 10% lower, then the loss recognised
in Other Comprehensive Income would have been £91,000 lower (2018: £183,000 lower). Corresponding gains would be
seen for a 10% uplift.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

19. Stock properties

Stock properties

2019
£’000

350

2018
£’000

448

The cost of stock properties recognised as an expense and included in cost of sales amounted to £98,000 (2018 – £nil).
Impairments of £nil have been recognised against stock properties (2018 – £nil).

The market value of stock properties is £600,000 (2018 – £1,190,000).

£600,000 (2018: £1,090,000) 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 2019 was undertaken by the Directors (31 December 2018 was also valued
by the Directors). 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.

20. Investments (current assets)

Listed or quoted investments

These are investments that are held for short term trading and not for long term investment.

21. Capital commitments

Capital expenditure that has been contracted for but has not been
provided for in the accounts

2019
£’000

168

2019
£’000

1,812

2018
£’000

–

2018
£’000

100

This relates to an ongoing development started in 2019 for a large retail unit and flats above it with £0.3m of the above
being settled by the time of announcement.

22. Trade and other receivables

Trade receivables
Bad debt provision

Other receivables
Prepayments
Accrued income

2019
£’000

3,683
(1,392)

2,291
–
299
799

3,389

2018
£’000

4,795
(1,659)

3,136
76
1,210
474

4,896

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 £12,575,000 (2018 – £23,736,000) (which relates to £3,090,000 (2018 – £3,686,000) included in the above (less
prepayments) and the Group’s cash or cash equivalents).

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

22. Trade and other receivables continued
Debts are specifically provided for on an expected credit loss model. The bad debt provision includes all material doubtful
debts that the directors are aware of. Other receivables and accrued income are shown net of provisions.

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

Trade
receivables
£’000

Accrued
income
£’000

Other
receivables
£’000

Cash and cash
equivalents
£’000

Total bad debt
provisions
£’000

Balance at 1 January 2018
Amount written off as uncollectable
Charge/(credit) to income statement

Balance at 1 January 2019
Amounts written off as uncollectable
Charge/(credit) to income statement

Balances at 31 December 2019

1,569
(707)
797

1,659
(804)
537

1,392

571
–
–

571
(571)
–

–

250
–
–

250
(239)
(11)

–

48
–
(1)

47
–
(2)

2,438
(707)
796

2,527
(1,614)
524

1,437

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
86.5p 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 mitigated by the use of bank counterparties 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 note 22). Further information on the Group’s credit risk is detailed within the Group Strategic Report.

24. Share capital

Allotted, called up and fully paid
17,746,929 (2018 – 17,746,929) ordinary shares of £0.25 each

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

2019
£’000

2018
£’000

4,437

During 2019 no ordinary shares were issued in the period (2018 – no ordinary shares were issued). 63,460 (2018 – 63,460)
ordinary shares are held in treasury.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

25. Capital reserves

Share premium account
At 31 December

Treasury shares
At 31 December

Capital redemption reserve
At 31 December

26. Bank loans

Bank loans due within one year
(within current liabilities)
Bank loans due within more than one year
(within non-current liabilities)

Total bank loans

Analysis of debt maturity

Trade and other payables**
Bank loans repayable
On demand or within one year
In the second year
In the third year to the fifth year

2019
£’000

2018
£’000

5,491

(213)

604

2019
£’000

1,072

2018
£’000

1,071

58,955

58,864

60,027

59,935

2019
£’000
Interest*

–

1,561
520
1

2,082

2019
£’000
Capital

5,172

1,072
59,072
42

60,186

2019
£’000
Total

5,172

2,633
59,592
43

62,268

2018
£’000
Total

6,749

2,764
2,735
60,185

72,433

based on the year end 3 month LIBOR floating rate – 0.68%, and bank rate of 0.10%.

** Trade creditors, other creditors and accruals

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 Group has commenced talks with its lenders to renew the facilities on similar terms
and hopes to have this in place by 31 December 2020. The initial conversations have been very positive and the Board
believes there should be no issues with the Group’s loan renewal.

A Shawbrook bank loan of £186,000 at the year end 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.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

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.

Liability at 1 January 2018
Debit to equity for the year
Credit to Income Statement for the year

Asset at 1 January 2019
Debit to equity for the year
Credit to Income Statement for the year

Asset at 31 December 2019

Deferred taxation arises in relation to:

Deferred tax

Deferred tax liabilities:
Investment properties

Deferred tax assets:
Tax allowances in excess of book value
Fair value of investments
Derivative financial liability

Net deferred tax asset

Total
£’000

(1,183)
34
2,960

1,811
30
1,463

3,304

2019
£’000

2018
£’000

(1,533)

(2,840)

266
64
4,507

3,304

281
34
4,336

1,811

As at 31 December 2019 the substantively enacted rate was 17% (2018: 17%) and this has been used for the deferred tax
calculation. The most recent budget approved an increase back to 19% but this was substantively enacted in March 2020.

28. Trade and other payables

Trade creditors
Social security and other taxes
Other creditors
Leases (see note 31)
Accruals
Deferred income

2019
£’000

2,863
132
1,225
651
1,084
2,586

8,541

2018
£’000

5,126
462
1,138
571
485
2,410

10,192

Trade creditors and accruals comprise amounts outstanding for trade purchases.

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 £73,894,000 (2018 – £75,227,000) (includes
payables above and the long term and short term borrowings, excluding deferred income plus lease liabilities).

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

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
Shawbrook Bank Ltd

Rate

7.01%
6.58%

2019
£’000

35,000
25,000
(159)

–
186

60,027

2018
£’000

35,000
25,000
(322)

–
257

59,935

Rate

7.01%
6.58%

Bank loans totalling £60,000,000 (2018 – £60,000,000) are fixed using interest rate swaps removing the Group’s exposure
to fair value interest rate risk. Other borrowings are arranged at floating rates, thus exposing the Group to cash flow
interest rate risk.

Financial instruments for Group and Company

The derivative financial assets and liabilities are designated as held for trading.

Derivative Financial Liability
Interest rate swap
Interest rate swap
Interest rate swap

Hedged
amount
£’000

35,000
25,000
25,000

Duration of
contract
remaining
‘years’

18.69
1.92
10.00

Average
rate

5.06%
4.63%
2.13%

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

2019
Fair
value
£’000

(22,209)
(1,792)
(2,510)

(26,511)

(997)

2018
Fair
value
£’000

(21,482)
(2,517)
(1,515)

(25,514)

886

Fixed rate came into effect on 1 September 2008. Rate includes 1.95% 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 1.95% 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.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

29. Derivative financial instruments continued
Analysis of debt maturity

Annual cash flows in respect of derivative financial instruments are approximately £2,437,000 (2018: £2,533,000) per
annum based on current LIBOR rates.

Interest rate risk

For the year ended 31 December 2019, 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 £2,000 higher (2018: £91,000 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 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.

30. Contingent liabilities
There were no contingent liabilities at the year end (2018: nil).

31. Lease arrangements and obligations under leases
IFRS 16 eliminates the classification of leases as operating leases or finance leases and treats all in a similar way to finance
leases (see note 35).

The Group as lessee

The Group paid rent under non-cancellable leases in the year of £842,000 (2018 – £940,000).

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 150 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 £842,000 (2018: £940,000) and the minimum for the year of £651,000 (2018: £611,000) is related to the
contingent element only payable out of rents receivable.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

31. Lease arrangements and obligations under leases continued
Minimum future payments under non-cancellable leases

(Lessee)

Payable within one year
Payable between one year and five years
Payable in more than five years

Anticipated rental income derived under non-cancellable sub leases

(Lessor)

Payable within one year
Payable between one year and five years
Payable in more than five years

Leases due within one year
(included within current liabilities)

Leases due within one to five years
Leases due in more than five years

(included within non-current liabilities)

Total lease obligations

The Group as a lessor

2019
£’000

651
2,603
43,648

46,902

2019
£’000

3,729
11,099
6,359

21,187

2019
£’000

651

2,604
5,308

7,912

8,563

2018
£’000

611
2,562
44,283

47,456

2018
£’000

3,727
10,820
7,446

21,993

2018
£’000

571

2,284
5,226

7,510

8,080

The Group rents out its investment properties under leases. Revenue represents the Groups rental income for the year.

Contracted rental income derived under non-cancellable leases on investment properties

Payable within one year
Payable between one year and five years
Payable in more than five years

2019
£’000

12,613
35,454
36,643

84,710

2018
£’000

11,863
33,315
39,045

86,223

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

32. Reconciliation of liabilities from financing activities

Derivative financial instruments
Leases (current)
Leases (non-current)
Borrowings (current)
Borrowings (non-current)

1 January
2018
£’000

(26,400)
(577)
(7,552)
(159)
(74,270)

(108,958)

1 January
2019
£’000

(25,514)
(571)
(7,510)
(1,071)
(58,864)

(93,530)

Cash
flow
£’000

–
571
–
161
14,125

14,857

Cash
flow
£’000

–
651
–
1,071
(1,000)

722

Non-cash
movements
New Leases
£’000

Other
non-cash
movements
£’000

31 December
2018
£’000

–
6
(529)
–
–

(523)

886
(571)
571
(1,073)
1,281

1,094

(25,514)
(571)
(7,510)
(1,071)
(58,864)

(93,530)

Non-cash
movements
New leases
£’000

Other
non-cash
movements
£’000

31 December
2019
£’000

–
(160)
(973)
–
–

(1,133)

(997)
(571)
571
(1,072)
909

(1,160)

(26,511)
(651)
(7,912)
(1,072)
(58,955)

(95,101)

33. Events after the reporting date
In January 2020, JE Beale PLC went into administration. They were a tenant within 13 freehold department stores owned
by the Group. The Group announced in January 2020 that the Directors believed that this would not have a material
effect on revenues.

COVID-19, as a health issue and with the government imposed closures to business and restriction on people’s
movements, will have a significant effect on the 2020 results including a potential decline in revenues and/or a future
impairment of assets. The financial effects cannot be reliably quantified at this early stage, but the Group is in a strong
financial position to weather the crisis. More details on this are contained with the Group Strategic Report.

The impact of COVID-19 is considered to be a non-adjusting post balance sheet event and as such the Statement
of Financial Position,
including property valuations, has been prepared on the facts and circumstances as at
31 December 2019.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

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.

At 31 December 2019 included within creditors was, £9,000 (2018: £24,000) payable to the beneficiaries of the estate
of late F Perloff, £24,000 due to H Perloff (2018: £4,000 due from him), both close family members of a director.
Movement in the year related to property management services. Also A Perloff owed the Group £17,000 (2018: £3,000)
at the year end.

At 31 December 2019 included within creditors was, £43,000 (2018: £49,000) owed to Maland Pension Fund a company
sponsored pension scheme (for a director). This is a trading relationship as the balance owed was in relation to a jointly
managed property were the interests were split and have been for many years. No contributions have been made by the
company for over a decade and there are no plans to make any further contributions.

Anglia Home Furnishings Ltd, a company owned wholly by Portnard Ltd, took assignment of a lease and pays rent to the
group of £125,000 pa.

During the year dividends of £1,323,000 (2018: £1,127,000) were paid to directors of the Group.

35. Adoption of IFRS 16
IFRS 16 eliminates the classification of leases as operating leases or finance leases and treats all in a similar way to finance
leases. It replaced IAS 17 and related interpretations. In accordance with IFRS 16 as the Group has taken the practical
expedient exemption the following only relates to the Group’s office premise and other related leases. No new leases have
been entered into since the date of transition being 1 January 2019.

Type of lease

New accounting policy

Nature of change in accounting policy

Office premises

Liabilities for such leases are recognised and
measured at the present value of the
remaining lease payments. For new leases
these are discounted using the rate implicit in
the lease when readily determinable. For
other leases these are discounted using the
incremental borrowing rate relevant to the
lease. A right of use asset has been
recognised using the retrospective approach.

Under
IAS 17, such lease payments were
recognised on a straight line basis over the lease
term and the leases were effectively “off balance
sheet”. For Investment properties held under
operating leases these were treated as finance
leases.

Short term and
low value leases
“Appropriate
practical
expedients”

IFRS 16 allows for low values leases not to be
recognised as a right of use asset. Such
leases are recognised on a straight line basis.
We consider any lease with a value under of
no more than £10,000 falls into this category.

IFRS 16 does not impact the treatment of low
value leases.

The Group has adopted IFRS 16 using the modified retrospective method (including appropriate practical expedients),
with effect of initially applying this standard recognised to the date of initial application (i.e. 1 January 2019). Accordingly,
the information presented for 2018 has not been restated.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Consolidated Financial Statements continued

35. Adoption of IFRS 16 continued
The impact of transition to IFRS 16 on retained earnings at 1 January 2019 is £Nil as any adjustments to the reserves are
not considered material.

The sub-lease for the office premises has not been recognised on the grounds of materiality.

The nature and accounting of Group’s leasing activities

Operating leases in relation to investment properties in accordance with IAS 17 were previously accounted for as finance
leases. The Group has other lease contracts for property, motor vehicles, office equipment, plant and equipment which
have lease terms varying between 2 and 11 years. The Group also has certain leases with lease terms of 12 months or
less and leases of office equipment with low value. The Group has applied the recognition exemptions for these leases.

The group has taken the practical expedient to not to apply this Standard to contracts that were not previously identified
as containing a lease applying IAS 17 and IFRIC 4. Contracts may contain both lease and non-lease components. The
Group allocates consideration between lease and non-lease components based on the price a lessor, or similar supplier,
would charge to purchase that component separately. The lease term begins at the commencement date and includes
any rent-free periods provided by the lessor. Lease terms vary between contracts and depend on the individual facts
and circumstances of the contract.

Lease liabilities are measured at the present value of the remaining lease payments, discounted using the Group’s
incremental borrowing rate as at 1 January 2019. The Group’s incremental borrowing rate is the rate at which a similar
borrowing could be obtained from an independent creditor under comparable terms and conditions. The weighted-
average rate applied was 7%.

Measurement of lease liabilities:

Operating lease commitments disclosed at 31 December 2018
Discounted using the incremental borrowing rate at 31 December 2018

Lease liability recognised as at 31 December 2018
Leases not previously recognised as finance leases

Lease liability recognised as at 1 January 2019

£’000

47,456
(39,376)

8,080
629

8,709

36. Approval of financial statements
The financial statements were approved by the Board of Directors and authorised for issue on 14 May 2020.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Parent Company Independent Auditor’s Report
To the Members of Panther Securities PLC

Opinion
We have audited the financial statements of Panther
Securities PLC (the ‘Parent Company’) for the year ended
31 December 2019 which comprise the Parent Company
Statement of Financial Position, the Parent Company
Statement of Changes in Equity and the Notes to the
including a summary of
Parent Company Accounts,
significant accounting policies. The financial reporting
framework that has been applied in their preparation is
applicable law and United Kingdom Accounting Standards,
including FRS 101 “Reduced Disclosure Framework” (United
Kingdom Generally Accepted Accounting Practice).

In our opinion, the Parent Company financial statements:

•

give a true and fair view of the state of the Parent
Company’s affairs as at 31 December 2019;

have been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice; and

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

Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable law.
Our responsibilities under those standards are further
described in the Auditor’s responsibilities for the audit of
the Parent Company financial statements section of our
report. We are independent of the Parent Company in
accordance with the ethical requirements that are
relevant to our audit of the Parent Company financial
statements in the UK, including the FRC’s Ethical Standard
as applied to SME listed entities, and we have fulfilled our
other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis
for our opinion.

Conclusions relating to going concern
We have nothing to report in respect of the following
matters in relation to which the ISAs (UK) require us to
report to you where:

•

the Directors’ use of the going concern basis of
accounting in the preparation of the Parent Company
financial statements is not appropriate; or

•

the Directors have not disclosed in the Parent
Company financial statements any identified material
uncertainties that may cast significant doubt about
the Parent Company’s ability to continue to adopt
the going concern basis of accounting for a period of
at least twelve months from the date when the
Parent Company financial statements are authorised
for issue.

Emphasis of matter – Impact of COVID-19
We draw attention to note 4 of the financial statements,
which describes the impact of COVID-19 on the Parent
Company. Our opinion is not modified in respect of
this matter.

Other information
The other information comprises the information included
in the Annual Report and Financial Statements, other than
the Group and Parent Company financial statements and
our auditor’s reports thereon. The Directors are
responsible for the other information. Our opinion on the
Parent Company financial statements does not cover the
other information and, except to the extent otherwise
explicitly stated in our report, we do not express any form
of assurance conclusion thereon.

In connection with our audit of the Parent Company
financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other
information is materially inconsistent with the Parent
Company financial statements or our knowledge obtained
in the audit or otherwise appears to be materially
misstated. If we identify such material inconsistencies or
apparent material misstatements, we are required to
determine whether there is a material misstatement in the
Parent Company financial statements or a material
misstatement of the other information. If, based on the
work we have performed, we conclude that there is a
material misstatement of this other information, we are
required to report that fact.

We have nothing to report in this regard.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Parent Company Independent Auditor’s Report continued

In preparing the Parent Company financial statements,
the Directors are responsible for assessing the Parent
Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern
and using the going concern basis of accounting unless
the Directors either intend to liquidate the Parent
Company or to cease operations, or have no realistic
alternative but to do so.

Auditor’s responsibilities for the audit of the
Parent Company financial statements
Our objectives are to obtain reasonable assurance about
whether the Parent Company financial statements as a
whole are free from material misstatement, whether due
to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level
of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect
a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of
users taken on the basis of these Parent Company
financial statements.

A further description of our responsibilities for the audit
of the parent company financial statements is located
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities. This description
forms part of our auditor’s report.

Other matter
We have reported separately on the Group financial
statements of Panther Securities PLC for the year ended
31 December 2019. That report includes the key audit
matters and other audit planning and scoping matters that
relate to the Parent Company.

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Opinion on other matters prescribed by the
Companies Act 2006
In our opinion, based on the work undertaken in the course
of the audit:

•

the information given in the Strategic Report and the
Directors’ Report for the financial year for which the
Parent Company financial statements are prepared
is consistent with the Parent Company financial
statements; and

the Strategic Report and the Directors’ Report have
been prepared in accordance with applicable legal
requirements.

Matters on which we are required to report
by exception
In the light of the knowledge and understanding of the
Parent Company and its environment obtained in the
course of the audit, we have not identified material
misstatements in the Strategic Report or the Directors’
Report.

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:

•

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’
specified by law are not made; or

remuneration

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

Responsibilities of Directors
As explained more fully in the Directors’ Responsibilities
Statement set out on page 20, the directors are responsible
for the preparation of the Parent Company financial
statements and for being satisfied that they give a true and
fair view, and for such internal control as the Directors
determine is necessary to enable the preparation of Parent
Company financial statements that are free from material
misstatement, whether due to fraud or error.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Parent Company Independent Auditor’s Report continued

Use of our report
This report is made solely to the Parent 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 Parent
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
Parent Company and the Parent Company’s members as
a body, for our audit work, for this report, or for the
opinions we have formed.

Jacqueline Oakes
Senior Statutory Auditor,
for and on behalf of
Nexia Smith & Williamson

25 Moorgate
London
EC2R 6AY

Statutory Auditor
Chartered Accountants

14 May 2020

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Parent Company Statement of Financial Position
As at 31 December 2019

Fixed assets
Investments

Current assets
Debtors
Current asset investments
Cash at bank and in hand

Creditors: amounts falling
due within one year

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
Treasury shares
Capital redemption reserve
Profit and loss account

Shareholders’ funds

Notes

£’000

40
41

93,145
168
7,841

101,154

(11,188)

43
29

45
25
25
25

2019
£’000

25,275

89,965

115,241

(58,841)
(26,511)

29,889

4,437
5,491
(213)
604
19,570

29,889

£’000

98,724
–
18,141

116,865

(15,940)

2018
£’000

26,198

100,925

127,123

(58,678)
(25,514)

42,931

4,437
5,491
(213)
604
32,612

42,931

As permitted under Section 408 of the Companies Act 2006, no Income Statement or Statement of Comprehensive
Income is presented for the parent company.

The Parent Company made a loss of £8,120,000 (2018: a profit of £22,880,000).

The accounts were approved by the Board of Directors and authorised for issue on 14 May 2020. They were signed on
its behalf by:

A.S. Perloff
Chairman

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Parent Company Statement of Changes in Equity
For the year ended 31 December 2019

Balance at 1 January 2018
Profit for the year
Movement in fair value of
investments taken to equity
Deferred tax relating to movement in
fair value of investments taken to equity
Dividends

Balance at 1 January 2019
Loss for the year
Movement in fair value of investments
taken to equity
Deferred tax relating to movement in
fair value of investments taken to equity
Realised fair value of disposal of
investments previously taken to equity
Realised deferred tax relating to disposal
of investments previously taken to equity
Dividends

Capital
Treasury redemption
reserves
£’000

shares
£’000

Share
capital
£’000

4,437
–

Share
premium
£’000

5,491
–

–

–
–

–

–
–

(213)
–

–

–
–

4,437
–

5,491
–

(213)
–

–

–
–

–

–
–

–

–
–

Retained
earnings
£’000

13,962
22,880

Total
£’000

24,281
22,880

(197)

34
(4,067)

32,612
(8,120)

34
(4,067)

42,931
(8,120)

(225)

(8)
(4,775)

604
–

–

–
–

604
–

–

–
–

Balance at 31 December 2019

4,437

5,491

(213)

604

19,570

29,889

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Parent Company Financial Statements
For the year ended 31 December 2019

37. 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 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 financial instrument disclosures; and

the exemption from certain fair value disclosures.

Critical accounting judgements and key sources of estimation uncertainty

The preparation of financial statements requires management to make judgements, estimates and assumptions that
affect the amounts reported for assets and liabilities as at the Statement of Financial Position 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.

Judgements and key sources of estimation uncertainty of the Group, applicable to the consolidated financial statements
have been disclosed in note 3 to the consolidated financial statements. There are no additional judgements and key
sources of estimation uncertainty that are applicable to the Parent 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 investments in subsidiaries.

Revenue recognition

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

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Annual Report & Financial Statements 2019

Notes to the Parent Company Financial Statements continued

37. Accounting policies for the Parent Company continued
Investments

Under IFRS 9, the Company has made an irrevocable election at initial recognition for particular investments in equity
instruments that would otherwise be measured at fair value through profit or less to present subsequent changes through
other comprehensive income. Fair values of these investments are based on quoted market prices where available. The
fair value of the investments in unquoted equity securities is considered where it can and cannot be measured reliably 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 IFRS 9, under the expected credit loss model, the
impairment losses are recognised in the Income Statement. The 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.

Current asset investments are held for short term trading and are carried at fair value with movements in fair value
recognised in the Income Statement.

38. Staff costs

Staff costs, including Directors’ remuneration, were as follows:
Wages and salaries
Social security costs
Pension contributions

2019
£’000

785
87
12

884

2018
£’000

947
107
33

1,087

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

Directors
Other employees

2019
Number

2018
Number

5
19

5
16

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Parent Company Financial Statements continued

39. Fixed asset investments

Cost or valuation
At 1 January 2019
Movement in fair value taken to equity

Movement in fair value take to equity realised on disposal
Disposals

At 31 December 2019

Investments:
Listed
Unlisted

Shares in Group
undertakings
£’000

Other
investments
£’000

24,348
–

–
–

24,348

–
24,348

1,850
(225)

48
(746)

927

910
17

Total
£’000

26,198
(225)

48
(746)

25,275

910
24,365

The above investments are shown at market value where there is an active market for these shares. The historic cost of
listed investments is £1,284,000 (2018: £2,030,000).

For details of the Company’s subsidiaries at 31 December 2019, see note 17.

40. Debtors

Due less than one year:
Trade debtors
Corporation tax
Amounts owed by Group undertakings
Prepayments and accrued income
Due more than one year:
Deferred tax (note 44)

41. Investments (current assets)

Listed or quoted investments

2019
£’000

268
1,270
87,022
15

4,570

93,145

2019
£’000

168

2018
£’000

287
2,573
90,809
685

4,370

98,724

2018
£’000

–

These are investments that are held for short term trading and not long term investment.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Parent Company Financial Statements continued

42. Creditors
Amounts falling due within one year

Trade creditors
Bank loans
Amounts owed to Group undertakings
Social security and other taxes
Other creditors
Accruals and deferred income

43. Creditors
Amounts falling due after more than one year

Bank loans

2019
£’000

42
1,000
9,541
46
141
418

11,188

2018
£’000

1,109
1,000
13,610
70
90
61

15,940

2019
£’000

2018
£’000

58,841

58,678

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.

44. Deferred taxation
The following potential deferred taxation asset is recognised:

Fair value of investments
Fair value of financial instruments

45. Called up share capital

Authorised
30,000,000 ordinary shares of £0.25 each

Allotted, called up and fully paid
17,746,929 (2018: 17,746,929) ordinary shares of £0.25 each

2019
£’000

63
4,507

4,570

2018
£’000

34
4,336

4,370

2019
£’000

2018
£’000

7,500

4,437

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

During 2019, no ordinary shares were issued in the period (2018: nil). 63,460 (2018: 63,460) ordinary shares of £0.25 each
are held in treasury representing 0.4% of the Company’s issued share capital.

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notes to the Parent Company Financial Statements continued

46. 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.

During the year dividends of £1,323,000 (2018: £1,127,000) were paid to directors of the Group.

47. Risk management
For information on the Company’s risk management please refer to note 29 of the Group accounts.

48. Events after the reporting period date
In January 2020, JE Beale PLC went into administration. They were a tenant within 13 freehold department stores owned
by the Group. The Group announced in January 2020 that the Directors believed that this would not have a material
effect on revenues.

COVID-19, as a health issue and with the government imposed closures to business and restriction on people’s
movements, will have a significant effect on the 2020 results including a potential decline in revenues and/or a future
impairment of assets. The financial effects cannot be reliably quantified at this early stage, but the Company is in a strong
financial position to weather the crisis. More details on this are contained with the Group Strategic Report.

49. Authorisation of financial statements and statement of compliance with FRS101
The financial statements of Panther Securities PLC (the “Company”) for the year ended 31 December 2019 were
authorised for issue by the Board of Directors on 14 May 2020 and the Statement of Financial Position 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 37.

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notice of Annual General Meeting

Arrangements for the 2020 Annual General
Meeting (AGM) in light of COVID-19.
In view of the COVID-19 pandemic and the Government’s
measures to restrict travel and public gatherings currently
in force (the Movement Restrictions),
including the
prohibition on public gatherings of more than two people,
the Board has decided that it is not possible to hold the
Company’s AGM in its usual format.

Notice is hereby given that the 86th Annual General
Meeting of Panther Securities P.L.C. is planned to be held
on 23 June 2020 at Unicorn House, Station Close, Potters
Bar, Herts., EN6 1TL at 10.00 am but due to the COVID-19
restrictions. NO members in addition to S. J. Peters and
A. S. Perloff (who will make up the quorum) will be
allowed to be present. Any member who attempts to
attend will not be allowed access. The only voting being
accepted will be via Proxy Voting and no one apart from the
Chairman will be allowed to be a Proxy. Please see Notes 1
to 7 to this notice for further information about proxies.

Following the closure of the AGM a ZOOM meeting
will be held for shareholders who want to ask questions
about the accounts and generally it will be capped at
a maximum of 100 people. If you want to have the login
details for the ZOOM meeting you will need to email
info@pantherplc.com with subject “Shareholder meeting”
at least 3 days before the meeting. Requests for admission
will be dealt with on a first come, first served basis .

As Ordinary Business
1. To receive and adopt the Group Strategic Report,
Directors’ Report and Financial Statements for the
year ended 31 December 2019 contained in the
document entitled “Annual Report and Financial
Statements 2019”.

2. To ratify the payment of a final dividend of 6.0p per

ordinary share as the final dividend.

3. To re-elect S. J. Peters who is retiring by rotation, as

a Director.

4. To appoint new auditors Crowe U.K. LLP and to
to determine their

authorise the Directors
remuneration.

5. 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):

5.1 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 2021 (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

5.2 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.

6. That, subject to the passing of resolution 5, 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:

As Special Business
To consider, and, if thought fit, pass the following resolutions
of which resolutions 5 and 7 will be proposed as ordinary
resolutions and resolution 6 as a special resolution.

6.1 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

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notice of Annual General Meeting continued

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

6.2 the allotment or sale (otherwise than pursuant
to paragraph 6.1 above) of equity securities up
to an aggregate nominal value not exceeding
£221,000; and

6.3 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 2021 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.

7. 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:-

7.1 The maximum number of shares which may be

purchased is 2,500,000 ordinary shares;

7.2 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

7.3 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.

The directors believe that the proposals in resolutions
1-7 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
Unicorn House
Station Close, Potters Bar
Hertfordshire EN6 1TL

14 May 2020

See over for notes.

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Annual Report & Financial Statements 2019

Notice of Annual General Meeting continued

Notes

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 Link 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.

4. 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 3 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.

6. 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
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

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

Notice of Annual General Meeting continued

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.

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.

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

15. 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.

16. A copy of this Notice, and other information required by
section 311A of the Companies Act 2006, can be found
at www.pantherplc.com

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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 the close of business on
22 June 2020 or, if the meeting is adjourned, in the
register of members at close of business. 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 at close of business on
22 June 2020, or, if the meeting is adjourned, in the
register of members at close of business. 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 14 May 2020, the Company’s issued
share capital comprised 17,683,469 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 14 May 2020 is 17,683,469.

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

Panther Securities P.L.C.

Annual Report & Financial Statements 2019

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 are to be put to
shareholders.

Please ignore any reference to voting in person at the
AGM only proxy voting will be accepted.

All resolutions save for Resolution 6 are ordinary
resolutions and will be passed if more than 50% of the
votes cast for or against are in favour. Resolution 6 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 2019. 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 2019”.

Resolutions 3 – Re-election of directors

In accordance with the Articles of Association of the
Company Simon Peters will stand for re-election as a
director 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 4 – Auditors’ 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
the
shareholder
appointment of Crowe LLP 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.

approval

for

Resolution 5 – 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 14 May 2020 the latest
practicable date prior to the publication of the notice.

Resolution 6 – 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 £241,000 (representing approximately 5% of the
Company’s issued ordinary share capital as at 14 May
2020, 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 6 is passed, this
authority will expire at the same time as the authority to
allot shares given pursuant to resolution 5.

Resolution 7 – 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 14 May 2020, 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.

Annual Report & Financial Statements 2019

Forty Nine Year Review

Profit/
Rental
(loss)
Income before tax
£’000s
£’000s

Year

Net

assets Dividend
£’000s per share

Net
assets
per

share Major events

1971
2
1972
2
1973
2
1974
3
1975
4
1976
6
1977
11
1978
31
1979
75
1980
159
1981
251
1982
309
1983
354
1984
502
1985
559
1986
641
1987
786
1988
1,292
1989
1,329
1990
1,263
1991
1,714
1992
2,722
1993
2,942
1994
3,229
1995
3,637
1996
4,025
1997
4,647
1998
4,735
1999
4,961
2000
5,518
2001
6,020
2002
7,951
2003
9,125
2004
9,194
2005
8,099
2006
7,510
2007
7,526
2008
7,064
2009
7,380
2010
7,717
8,961
2011
2012 10,781
2013 12,502
2014 12,512
2015 12,840
2016 12,965
2017 12,946
2018 13,607
2019 14,226

189
9
525
21
532
29
533
30
470
(19)
306
(151)
234
(63)
281
(29)
229
21
328
52
909
91
1,423
99
1,753
137
2,832
49
3,135
107
4,090
164
240
6,750
905 11,725
580 12,211
2,261 10,601
556 14,277
(114) 11,942
707 13,877
1,729 18,569
1,114 18,836
2,146 21,746
2,173 24,010
3,236 28,500
2,056 32,875
2,396 32,285
3,531 37,186
2,956 38,240
3,413 50,104
7,632 49,871
26,549 67,632
9,269 73,269
9,089 78,608
(14,331) 65,846
2,953 68,010
6,401 71,222
(2,312) 66,955
(4,633) 61,992
8,155 67,876
4,377 71,472
8,470 76,017
(2,015) 72,279
24,791 91,212
8,700 94,029
(4,963) 84,946

0.04p
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–
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0.19p
0.22p
0.22p
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0.33p
1.1p
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22.0p
27.0p
12.0p

Note: bold dividend indicates includes a special dividend

2p
5p Perloffs’ and M Bloch took control
5p
5p
4p
3p Acquired Willsesden Optical Works Ltd
2p 1st business centre created at Mount Pleasant
3p
2p
3p Sold all optical interests
8p
13p
16p
26p
29p
38p
63p Acquired Surrey Motors ltd

109p
113p

98p Bid for Multitrust PLC
99p Acquired Saxonbest Ltd
83p Acquired Etonbrook Properties PLC
96p
99p Re-obtained full listing and acquired Multitrust Property Investments ltd

101p
121p Bid for Elys PLC
133p
157p
182p Acquired Northstar Group
190p Malcolm Bloch retired
219p
226p Acquired Eurocity Properties PLC
295p
293p S Peters joins. Sold Panther House.
398p P Rowson retires/J Perloff and S Peters join board
431p
465p
390p Global financial banking crisis
403p
422p
397p
367p
395p Went from full listing to AIM in Dec 13
409p
428p Sold MRG Systems Ltd
407p BREXIT fears
516p
532p Record disposals – £41m for £11m profit.
480p

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Panther Securities P.L.C.

Annual Report & Financial Statements 2019

For your notes

Barry Parade Proposed Development
(two views from Peckham Rye Park)

Caerphilly (Nr Cardiff) Office Complex

Bishop Auckland

Gateshead – Mixed Use Investment

Broadstairs (Proposed Elevations)

Panther Securities P.L.C.
Unicorn House
Station Close
Potters Bar
Hertfordshire EN6 1TL
www.pantherplc.com