Dunloe Ewart reports €6.92m loss and warns of continued hardship

Property  group Dunloe Ewart yesterday reported a first-half loss of €6.92 million and warned that difficult conditions would continue into next year.

The pre-tax loss in the six months to the end of June compared with a €12.23 million deficit before tax in the same period last year, according to unaudited figures. Dunloe Ewart is the subject of a long controversy surrounding the relationship with its biggest shareholder, apartment-builder Mr Liam Carroll, who has never disclosed plans for the company.

Its stock closed four cents weaker on the Dublin market yesterday at 30 cents with some 473,000 shares changing hands. The fully diluted loss per ordinary share was 1.82 cent in the period, down from 3.32 cent.

Slower growth in the property market would have an impact on profits this year and in 2003, Dunloe Ewart said. The latest loss was recorded in the same period as the disposal for £90.75 million sterling (€143.9 million) of 13 Northern Ireland properties on June 28th. The company lost €6.6 million on that transaction.

The interim results show that rental income from continuing operations fell to €1.8 million in the period from €10.62 million a year earlier. Rents from discontinued operations were €4.53 million. Revenues from the development and sale of property fell to €19.49 million from €26.27 million. The loss was recorded after providing €15.4 million against the carrying cost of development sites, €1.2 million in rationalisation costs and €5.1 million in costs linked to the early repayment of medium-term bank debt.

Dunloe said it had €113 million cash in the bank on June 30th. It has agreed to spend €63.85 million acquiring from British Land a 50 per cent stake in its joint venture at Cherrywood, south Dublin, that it does not already own.

That agreement is subject to a vote by shareholders at an extraordinary meeting on October 1st. The proposal requires the support of a simple majority, meaning that Mr Carroll will be unable to block it. Owner of some 27 per cent of Dunloe, Mr Carroll has thwarted a number of initiatives proposed by chairman Mr Noel Smyth.

Dunloe is in effective dispute with Mr Carroll and has informed him that he had no right or interest in respect of his shares. It alleges a notification he made to the company on July 26th was "out of time" and indicated that previous indications did not fulfil his obligations under the Companies Act.