I'd be surprised if the board hadn't taken account of the refinancing when they made their announcement to increase the target dividend to 5.9p/yr in November. |
Thanks. Helpful. Any buyer would prov in the refinancing though so I’m not sure that solves the problem… |
That is the question.
AIRE say the average fixed interest rate on its £41M loan facility is 3.19%, but finance costs are a touch higher at about £1.4M a year. What is the "current rate" or more importantly what will the rate be when they can't put off renegotiating finances any further ... I would say 12-18 months away.
To make sums easy let's say a new deal is done at 6.5%.
The rest of the maths depends on how well rental income improves. A gross increase to £8M perhaps. Which means we will have £1.1M less to spend on dividends, down from about £5.5M to £4.4M.
All else being equal a 20% cut on the way. At the current share price yield would fall from a sector leading 8.8% to "only" 6.9%. Down to 1.1p per qtr. Oh well.
I remain hopeful that this will be resolved when AIRE are taken out by a bigger REIT for around 73-74p. |
Has anyone worked out what the dividend will be post a refinancing at current rates? |
That rise was ST Tip inspired. |
lol - that makes it sound like the "substantial narrowing of the discount" occured prior to the share price rise to 71.5p. |
No obvious signs of concerns in the interims just released
On track to deliver target annual dividend of at least 5.9 pence per share for the financial year ending 30 June 2024
Resilient portfolio well placed to continue to provide secure, index-linked income with the potential for capital growth
The Board expect dividend to be fully covered, subject to the reinvestment of the Glasgow sale proceeds and the continued collection of rent from the Group's property portfolio. Annualised rent grew by 2.9% in the Period after taking account of the rent-free incentive period for Pets at Home in Droitwich.
Slightly 'amusing' that the results highlight "following a substantial narrowing of the discount, the share price increased substantially by 10.5% to 71.50pps and the share price total return for the Period was 15.7%." when the share price on release of the results was 64.1p, lower than the start of the 'share price increase'... |
Struggling here a bit, waiting for news to paint a better interest rate outlook.
SUPR in the right spot judging by stronger retail sector news? Same problem as here though, chunky debt and wide discount despite income covering an attractive dividend. |
10% is not enough. You'll get all of that and more by being patient with the current crop. |
Sector consolidation continues but big guys merging with even bigger guys, how about someone hoovering up performing small REITs which have a wide discount and a refinance on the horizon, at a 10% share price gain and all in cash, please and thank you. |
Tomorrow then |
Last year Div announcement was 1st Feb surprised no announcement yet |
Don't kick yourself - I took "profits" many pence lower a few weeks back. Mind you, bought other stuff which also moved higher.
I think yesterday was a day to buy almost anything reasonable as the Gilt market (higher by 20bps average) had been bought too hard, too quickly.
For me, the "fact" that rate rises are now considered over supports lower discounts (higher risk appetite) and that still has a way to run. Actual rate cuts on the back of inflation once again being in the area of 2% will move prices somewhat higher still. |
7p off the share price because CPI printed at 4% instead of 3.9%. Noting that this was based on miniscule trading, an indication of how few shares are in circulation. We are a funny bunch though, if we think this has altered the outlook for AIRE so much.
Nevertheless hmmmmn, kicking myself for not taking the chance when tempted to bank profits last week, could had round-tripped to significant advantage. What chance of a good report coming up and renewed appreciation of the handsome dividend repairs the damage? |
Pretty brutal sell off. Somebody must want to get out in a hurry. |
nickrl,
Did you get a reply? |
Flying today, just been offered 74.5p for a good chunk, and still weeks ahead of the dividend. Not selling though. I assume this is continued momentum and the low availability of stock rather than specific rumours, very welcome and has got me wondering how much further AIRE share price might recover. 80-something, provided NAV tracks up? |
ive done it |
I'm a bit tied up today so if anyone else wants to follow this up, be my guest... |
How times change 'affluent' and Streatham' would not have been in the same sentence 40 years ago - an oxymoron even! |
Thanks SteMiS. That thought had also occurred to me. Will you email them for an explanation or shall I? |
@SteMis oh good spot suggest you drop them an email give the investment adviser something to do for our money to explain |
I'm confused. The announcement says
"the Company has completed the acquisition of the Virgin Active leisure club in an affluent suburban location in Streatham, in South-West London (the "Asset") for £5.1 million"
"The Asset has a passing rent topped up by the vendor to £390,121 pa"
I make the passing rent as 7.65% of acquisition cost, however they also say
"The price reflects a net initial yield of 9.8%"
? |
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