York Arcade Holdings Limited, a member of the Colombo Fort Land and Buildings Group, has presented a delayed annual report for the years 2006/2007 and advised shareholders that an extraordinary general meeting "for this calendar year" is being summoned on April 21 to present members of the company its audited financial statements for the year ended March 31, 2006.

The company’s Chairman, Mr. R. Senathi Rajah, has regretted the delay in presenting the accounts which indicated a net profit of Rs.5.2 million for the year ended March 31, 2007, up from Rs.3.3 million the previous year.

He reported that revenue was up 8% to Rs.30.5 million and the company had also succeeded in decreasing its direct and administrative cost by 23.5% and 15.6% respectively.

However income tax had grown sharply by 246% to Rs.10.2 million against the previous tax liability of Rs.2.9 million.

"The main contributing factor for this increase is the provision of Rs.4.6 million made for the timing differences, included in the provision for deferred taxation at the current rate of taxation," the chairman said.

He also said that consequent to the capital reduction process undertaken by the company in 2006, two installments of Re.1 each per share has already been paid to shareholders in April 2006 and 2007 while the third will be paid in April 2008 to be followed by a similar payment in April 2009.

The capital reduction has been made following court approval whereby the nominal value of the company’s share was reduced from Rs.5 to Re.1 effective from April 7, 2006.

"In view of the capital reduction, the company does not propose to pay a dividend for the financial year ended 31st March 2007," Senathi Rajah said.

York Arcade Holdings is engaged in real estate development as approved by the UDA.

The company’s auditors have said that it had not disclosed the fair value of investment property as explained in a note to the accounts. This stated that the carrying amount of investment property as at March 31, 2007 amounted to Rs.105 million, down slightly from Rs.106.7 million the previous year. The note says that estimated fair value of the building as at the end of the year has not been disclosed as it is not available.

In the year under review the company had earned rental income of Rs.23.9 million from the property, up from Rs.21.7 million the previous year and incurred direct operating expenses of Rs.13.3 million against Rs.17.4 million the previous year.

The accounts also disclosed that the mortgage of the leasehold rights of a property executed in favour of the National Development Bank as partial security for a loan of Rs.200 million granted to Lankem Ceylon Limited has been cancelled on full payment being made by Lankem.

York Arcade Holdings had a share capital of Rs.12 million as at March 31, 2007, down from Rs.60 million the previous year, and carried a share premium of Rs.2.4 million, a property development reserve of Rs.10 million and retained earnings of Rs.45.8 million in its books as at March 31, 2007.

Net assets per one-rupee share were down to Rs.5.85 from Rs.9.41 per five-rupee share the previous year.

The company’s share had traded at a high of Rs.17.25 and a low of Rs.7.75 during the year under review against a trading range of Rs.33.75 to Rs.6.25 the previous year.

Colombo Fort Land and Buildings Company with 49.27% is the major shareholder of York Arcade Holdings followed by Mercantile Credit which is under liquidation (8.22%), Colombo Fort Investments (3.64%) and Mr. H.A. Peiris (2.56%).