3. SEGMENTAL ANALYSIS
For management purposes, the Group is currently organised into three operating divisions:
Investment –  management of the Group’s investment property portfolio, generating rental income and valuation surpluses from property management;
Trading and development – managing the Group’s development projects. Revenue is received from project management fees and development profits; and
Operating – serviced office operations and retail activities. Revenue is principally received from short-term licence fee income.
     
These divisions are the basis on which the Group reports its primary segmental information. All operations occur and all assets are located in the United Kingdom, except assets of £1,394,000 (2005: £1,727,000), which are located in France and The Netherlands. Accordingly no secondary segmental information is shown. All revenue arises from continuing operations.
 
  Year ended 31st December 2006
  Investment
£’000		 Trading and
development
£’000		 Operating
£’000		 Total
£’000
Segment revenue 8,995 34,675 5,057 48,727
Direct costs (1,601) (26,195) (4,980) (32,776)
Segment result 7,394 8,480 77 15,951
Unallocated operating costs       (10,257)
Loss on disposal of investment properties (97) – – (97)
Net gain/(loss) on revaluation of property portfolio 21,821 – (475) 21,346
Operating profit       26,943
Share of results of associates and joint ventures accounted for using the equity method       151
Income from financial assets       63
Profit before interest and taxation       27,157
Finance income       2,954
Finance costs       (7,321)
Profit before taxation       22,790
Taxation       769
Profit after taxation attributable to equity shareholders of the parent       23,559
         
Assets and liabilities        
Segment assets 205,723 100,006 13,911 319,640
Unallocated assets       44,146
Total assets       363,786
         
Segment liabilities (83,771) (31,104) (2,593) (117,468)
Unallocated liabilities       (14,905)
Total liabilities       (132,373)
         
Other segment information        
Capital expenditure 7,047   1,305 8,352
Unallocated capital expenditure       242
Depreciation     982 982
Unallocated depreciation       146
         
  Year ended 31st December 2006
  Investment
£’000		 Trading and
development
£’000		 Operating
£’000		 Total
£’000
Revenue        
Rental income 8,700 124 – 8,824
Operating property income – – 5,057 5,057
Project management fees – 587 – 587
Trading property sales – 25,800 – 25,800
Development profits – 8,164 – 8,164
Other income 295 – – 295
  8,995 34,675 5,057 48,727
         
         
         
         
         
         
         
  Year ended 31st December 2005 restated
  Investment
£’000		 Trading and
development
£’000		 Operating
£’000		 Total
£’000
Segment revenue 10,626 9,687 5,155 25,468
Direct costs (1,994) (8,446) (4,778) (15,218)
Segment result 8,632 1,241 377 10,250
Unallocated operating costs       (10,538)
Profit on disposal of investment properties 3,728 – – 3,728
Net gain/(loss) on revaluation of property portfolio 18,028 – (174) 17,854
Operating profit       21,294
Share of results of associates and joint ventures accounted for using the equity method       1,453
Income from other fixed asset investments       149
Profit on disposal of investments       5,759
Profit before interest and taxation       28,655
Finance income       2,262
Finance costs       (7,667)
Profit before taxation       23,250
Taxation       (3,160)
Profit after taxation attributable to equity shareholders of the parent       20,090
         
Assets and liabilities        
Segment assets 226,002 59,568 11,681 297,251
Unallocated assets       22,070
Total assets       319,321
         
Segment liabilities (88,715) (27,268) (2,439) (118,422)
Unallocated liabilities       (13,391)
Total liabilities       (131,813)
         
Other segment information        
Capital expenditure 11,845   6 11,851
Unallocated capital expenditure       870
Depreciation     (909) (909)
Unallocated depreciation       (181)
         
  Year ended 31st December 2005 restated
  Investment
£’000		 Trading and
development
£’000		 Operating
£’000		 Total
£’000
Revenue        
Rental income 10,585 111 – 10,696
Operating property income – – 5,155 5,155
Project management fees – 266 – 266
Trading property sales – 9,135 – 9,135
Development profits – 175 – 175
Other income 41 – – 41
  10,626 9,687 5,155 25,468