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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Circle Property Plc | LSE:CRC | London | Ordinary Share | JE00BYP0CK63 | ORD NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 3.50 | 3.00 | 4.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMCRC
RNS Number : 1207W
Circle Property PLC
09 December 2019
9 December 2019
Circle Property Plc
Interim results for the six months ended 30 September 2019
Well positioned to deliver FY expectations of strong NAV growth
Circle Property Plc (AIM: CRC) ("Circle" or the "Company"), which invests in, develops and actively manages well-located regional office assets today announces its results for the six months to 30 September 2019. In the period, the Company has been actively building momentum into the business. Circle has established a strong pipeline of well located, income generating assets which, with our active asset management expertise, are expected to deliver strong returns in the second half.
Circle's current portfolio, which has been independently valued at GBP135.6 million as at 30 September 2019, is 99% focused in the office sector and has no exposure to the retail sector. All of our properties are geographically located in favourable regions with 89% in Birmingham, Milton Keynes, Maidenhead and Bristol.
These results demonstrate the consistent underlying strength of the regional office market which is underpinned by Permitted Development Rights and Circle's ability to identify sites which offer sustainably strong rental returns and value enhancement.
Financial highlights: Strong rental income; investment in property portfolio
-- Unaudited estimated NAV per share of GBP2.78 (30 September 2018: GBP2.75, 31 March 2019: GBP2.77), representing an 87% increase since IPO in February 2016
-- 7.2% increase in annualised contracted rental income to GBP8.2 million (31 March 2019: GBP7.6 million), with a further GBP598,478 of contracted rent since period end
-- Interim dividend up 10% to 3.3p (30 September 2018: 3.0p), maintaining the Company's progressive dividend policy
-- Property portfolio valuation increased to GBP135.6 million (31 March 2019: GBP124.6 million), largely due to Company's largest acquisition to date: the GBP14.6 million purchase (plus costs) of Concorde Park, Maidenhead
-- Since IPO, Circle has delivered a NAV compound average growth rate of 23% and a total return compound average growth rate of 26%, making Circle one of the top-performing public real estate companies
Operational highlights: largest acquisition since IPO driving uplift in contracted rental income
-- K2, Milton Keynes - letting of 20,482 sq ft to Grand Union Housing, contractual rent of GBP352,625 pax on a 10-year lease with a CPI rent review in the fifth year
-- Concorde Park, Maidenhead - acquisition of 71,500 sq ft business park for GBP14.6 million. Contracted passing rent (excluding rent free) GBP627,372 pax with a reversion to GBP1.55 million
Post HY 2020 highlights: Continued momentum
-- Victory House, Northampton - re-geared lease with Regus for a further 12 years, increase in contracted rental income to GBP360,000 per annum of which 30% will be based upon turnover
-- Concorde Park, Maidenhead - completed two lettings totalling approximately 21,000 sq ft increasing the contracted passing rent (excluding rent free) by a further GBP485,234 pax. Total gross contracted rental income at the site has increased by 76% since acquisition by the Company to over GBP1.1 million per annum with a gross rental income target of over GBP1.55 million per annum. The speed of these lettings since acquisition has been achieved by the Company's asset management expertise
-- 141 Moorgate, London EC2 - letting of the third floor to Suede Labs Ltd at GBP60,264 per annum
-- Elizabeth House, 56-60 London Road, Staines - letting of the ground floor to Accent Catering Ltd at GBP52,980 per annum
-- K3, Milton Keynes - refurbishment on track to commence in December 2019. Once completed the 13,500 sq ft office building will be offered to let at an ERV of approximately GBP270,000 pax
-- 135 Aztec West, Bristol - refurbishment on track to commence in January 2020. Once completed the 13,258 sq ft self-contained office will be offered to let at an ERV of approximately GBP245,300 pax
John Arnold, CEO of Circle Property Plc, commented:
"Circle's portfolio now comprises 99% (by value) regional offices, which is highly reversionary, and has no exposure to retail property. Our focus on "added value" rather than initial yield continues to reap rewards with income generation arising from judicious capital expenditure.
"In the six months ended 30 September and post period end, we have been investing in the pipeline, increasing our rental growth and we are on track to deliver expectations for the full year. In the first half, the pace of lettings has increased, with over GBP950,000 of newly-contracted rents being completed to date since the start of the year. This bodes well for an uplift in valuation at the year end and we look forward to continuing our positive momentum."
Contacts:
Hot Features
Premium
+44 (0)207 930
Circle Property Plc 8503
John Arnold, CEO
Edward Olins, COO
+44 (0)207 397
Cenkos Securities 8900
Azhic Basirov
Katy Birkin
+44 (0)203 897
Radnor Capital 1830
Joshua Cryer
Iain Daly
+44 (0)203 757
Camarco 4980
Ginny Pulbrook
Tom Huddart
About Circle Property Plc
Circle is amongst the best performing quoted UK real estate companies by NAV total return (NAV growth and dividend) having delivered consistent returns with 87% NAV growth since IPO in 2016 in absolute terms.
Circle focusses on acquiring assets in regional cities, many of which have significant office supply constraints, and on office assets with active management potential (refurbishment opportunities, under-rented or vacant properties or short leases), rather than just maximising initial rental yields.
Circle is not a Real Estate Investment Trust (REIT) and can actively recycle proceeds from asset sales into its refurbishment and redevelopment pipeline, as well as future investment opportunities, therefore targeting a broader range of returns for shareholders, which are primarily driven by NAV growth.
As well as already delivering substantial increases in NAV, the Company's portfolio has significant reversionary potential with current total estimated rental values of approximately GBP10.9 million per annum, compared to contracted rent of GBP8.2 million at 30 September 2019. The Company has a portfolio of 15 regional commercial property investment and development assets in the UK valued at GBP135.6 million as at 30 September 2019.
Chief Executive's Statement
In the six months ended 30 September 2019 and post period end, we have been highly active in sourcing, developing and managing an increased property portfolio, which is now valued at GBP135.6 million (30 September 2018: GBP124.8 million) and were successful in acquiring Concorde Park, Maidenhead, a south east office park for GBP14.6 million. With our management expertise we have identified that this acquisition has a potential reversionary yield of 9.8% when fully let.
Circle's strategic focus on regional commercial property resulted in strong rental income being achieved in the period. We achieved a 7.2% uplift in annualised contracted rental income to GBP8.2 million with a further GBP598,478 of contracted rent since the period end. The weighted average unexpired lease term (WAULT) is 8.41 years to break (31 September 2018: 10.15 years).
The occupancy levels of our property portfolio have been strong at 87.70% as at 30 September 2019 and since the period end, this has improved to 91.25% even when including the additional vacant accommodation at our recent acquisition, Concorde Park.
The Company's estimated unaudited NAV per share is up to GBP2.78 (30 September 2018: GBP2.75) representing an 87% increase since IPO, with a NAV compound average growth rate of 23% and a total return compound average growth rate of 26%, making the Company one of the top-performing publicly listed real estate companies.
Portfolio Overview
During the six-month period, Circle has been highly active in expanding its portfolio and negotiating lease renewals across the UK's regional office market.
Concorde Park: Maidenhead
In August 2019, the Company acquired Concorde Park, Maidenhead, a south east office park for GBP14.6 million. At the time of acquisition, the 71,500 sq ft park was 36.6% let to three tenants producing a combined rental income of GBP627,372 per annum. The vacant area totalled 45,328 sq ft of which 21,346 sq ft was under offer or in negotiation. The property benefited from being rebuilt in 2007 by LaSalle UK Ventures Property to a high specification including four new lifts, air conditioning and full height glazed atriums at a cost of around GBP7.4 million. Once fully let, Concorde Park has a potential reversionary yield of 9.8%.
Kents Hill Business Park, Milton Keynes
In June 2019, Grand Union Housing leased 20,462 sq ft in K2, Kents Hill Business Park, Milton Keynes at a rent of GBP352,625 per annum (GBP17.23 psf) for a 10-year term subject to a CPI rental increase in the fifth year of the term.
Great Charles Street, Birmingham
In September 2019, the Company completed a lease renewal at 36 Great Charles Street, Birmingham to the National Governors' Association on 4,708 sq ft for a term of 5 years at an annual headline rent of GBP75,617 pax before incentives.
Following on from the successful redevelopment and refurbishment of 36 Great Charles Street and Somerset House, Temple Street, both in Birmingham and K2, Kents Hill Business Park, totalling 116,062 sq ft, two new refurbishment projects are scheduled to commence in early 2020 at 135 Aztec West Bristol and K3 Kents Hill Business Park, with a combined total floor area of 26,758 sq ft.
Post the period end, leasing momentum was sustained and on competitive terms:
Victory House, Northampton - re-geared lease with Regus for a further 12 years, increase in contracted rental income to GBP360,000 per annum of which 30% will be based upon turnover.
Concorde Park, Maidenhead - completed two lettings totalling approximately 21,000 sq ft increasing the contracted passing rent (excluding rent free) by a further GBP485,234 pax. Total gross contracted rental income at the site has increased by 76% since acquisition by the Company to over GBP1.1 million per annum with a gross rental income target of over GBP1.55 million per annum. The speed of these lettings since acquisition has been achieved by the Company's asset management expertise.
141 Moorgate, EC2 - Letting to Suede Labs Limited in October 2019 for a term of 5 years at a headline rent of GBP60,264 pax, whilst the last remaining vacant fourth floor office is under offer.
Elizabeth House, Staines - In October 2019, the ground floor offices of 2,636 sq ft were let on a five-year lease to Accent Catering Services Limited at an annual headline rent of GBP52,750 pax, before incentives.
36 Great Charles Street, Birmingham - A five-year lease completed in November 2019 to Utility Aid Limited at an annual headline rent of GBP23,180.50, before incentives.
Dividend
The Board declares an interim dividend of 3.3p, an increase of 10% from HY 2018 (30 September 2018: 3.0p), in line with the Company's progressive dividend policy. The interim dividend will be paid on 15 January 2020 to shareholders on the register on 20 December 2019 with an ex-dividend date of 19 December 2019.
Outlook
During the past six months, the Circle Property team have been investing in the pipeline, increasing rental growth and we are on track to deliver expectations for the full year. In the first half, the pace of lettings has quickened, with over GBP950,000 of newly-contracted rents being completed to date since the start of the year. This bodes well for a positive uplift in valuation at the year end and we look forward to continuing our momentum.
Circle Property Plc
Condensed consolidated statement of comprehensive
income
for the 6 months ended 30 September 2019
6 months 6 months 12 months
to 30 September to 30 September to 31 March
2019 2018 2019
Note (unaudited) (unaudited) (audited)
GBP GBP GBP
--------------------------------------- ----- ----------------- ----------------- -------------
Rental income 4 3,563,322 3,644,353 6,878,912
Other income 4 105,286 157,473 224,323
--------------------------------------- ----- ----------------- ----------------- -------------
3,668,608 3,801,826 7,103,235
Property expenses 5 (289,086) (277,512) (639,440)
Net rental income 3,379,522 3,524,314 6,463,795
Administrative expenses 6 (982,058) (1,250,374) (2,794,124)
Operating profit before gains
on investment properties 2,397,464 2,273,940 3,669,671
(Loss)/Gain on disposal of investment
properties (44,331) 494,933 471,177
(Loss)/Gains on revaluation of
investment properties 11 (390,279) 11,733,347 12,609,968
Operating profit 1,962,854 14,502,220 16,750,816
Finance income 7 1,679 2,056 2,717
Finance costs 8 (858,920) (738,061) (1,507,471)
Net finance costs (857,241) (736,005) (1,504,754)
Profit for the period before taxation 1,105,613 13,766,215 15,246,062
Taxation 9 145,074 (227,372) (291,142)
Profit after taxation 1,250,687 13,538,843 14,954,920
--------------------------------------- ----- ----------------- ----------------- -------------
Earnings per share 10 0.04 0.48 0.53
--------------------------------------- ----- ----------------- ----------------- -------------
NAV per share 2.78 2.75 2.77
--------------------------------------- ----- ----------------- ----------------- -------------
There is no comprehensive income other than that included in the profit for the period. All of the profit for the period is attributable to the owners of the Company.
All items in the above statement derive from continuing operations.
Condensed consolidated statement of financial
position
as at 30 September 2019
Note 30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------ ----- ------------- ------------- ------------
Non-current assets
Investment properties 11 126,146,508 115,750,716 115,320,178
Property plant and equipment 55,035 49,883 59,865
Trade and other receivables 12 8,546,628 8,516,589 8,310,903
Deferred tax 1,941,676 1,647,443 1,603,918
------------------------------ ----- ------------- ------------- ------------
136,689,847 125,964,631 125,294,864
Current assets
Trade and other receivables 12 1,811,350 1,242,391 1,553,699
Cash and cash equivalents 2,359,771 3,014,269 3,650,372
------------------------------ ----- ------------- ------------- ------------
4,171,121 4,256,660 5,204,071
Total assets 140,860,968 130,221,291 130,498,935
------------------------------ ----- ------------- ------------- ------------
Equity
Stated capital 42,542,179 42,542,179 42,542,179
Treasury share reserve (79,344) (77,486) (79,344)
Retained earnings 36,288,100 35,404,032 35,971,206
------------------------------ ----- ------------- ------------- ------------
Total equity 78,750,935 77,868,725 78,434,041
Non-current liabilities
Borrowings 13 59,391,252 50,100,845 49,039,681
------------------------------ ----- ------------- ------------- ------------
59,391,252 50,100,845 49,039,681
Current liabilities
Trade and other payables 14 2,718,781 2,251,721 3,025,213
------------------------------ ----- ------------- ------------- ------------
2,718,781 2,251,721 3,025,213
Total liabilities 62,110,033 52,352,566 52,064,894
------------------------------ ----- ------------- ------------- ------------
Total liabilities and equity 140,860,968 130,221,291 130,498,935
------------------------------ ----- ------------- ------------- ------------
The condensed consolidated interim financial statements were approved by the Board of Directors on 6 December 2019.
Condensed consolidated statement of
cash flows
for the 6 months ended 30 September
2019
6 months 6 months 12 months
to 30 September to 30 September to 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
--------------------------------------- ----------------- ----------------- -------------
Cash flows from operating activities
Profit for the period before taxation 1,105,613 13,766,215 15,246,062
Adjustments for:
Finance income (1,679) (2,056) (2,717)
Finance expense 858,920 738,061 1,507,471
Depreciation 5,443 6,404 13,296
Gains on revaluation of investment
properties 390,279 (11,733,347) (12,609,968)
Gains on disposal of investment
properties 44,331 (494,933) (471,177)
Share based payments - 180,001 178,143
(Increase) in trade and other
receivables (493,376) (1,415,944) (1,521,566)
(Decrease)/increase in trade and
other payables (653,810) (155,751) 961,902
Cash generated from operating
activities 1,255,721 888,650 3,301,446
Interest and other finance costs
paid (613,803) (660,129) (1,459,030)
Interest received 1,679 2,056 2,717
Net cash from operating activities 643,597 230,577 1,845,133
---------------------------------------- ----------------- ----------------- -------------
Cash flows from investing activities
Cost of refurbishment of investment
properties (404,189) (702,121) (1,006,634)
Cost of acquisition of investment (15,412,420) - -
property
Proceeds from disposal of investment
properties 4,555,671 3,444,933 2,228,749
Cost of additions of property
plant and equipment (615) - (16,874)
Net cash from investing activities (11,261,553) 2,742,812 1,205,241
---------------------------------------- ----------------- ----------------- -------------
Cash flows from financing activities
Repayment of borrowings - (1,750,000) (49,358,932)
Drawdown of borrowings 10,261,148 - 49,016,953
Dividends paid (933,793) (848,903) (1,697,806)
Net cash used in financing activities 9,327,355 (2,598,903) (2,039,785)
---------------------------------------- ----------------- ----------------- -------------
Net (decrease)/increase in cash
and cash equivalents (1,290,601) 374,486 1,010,589
Cash and cash equivalents at the
beginning of the period 3,650,372 2,639,783 2,639,783
---------------------------------------- ----------------- ----------------- -------------
Cash and cash equivalents at the
end of the period 2,359,771 3,014,269 3,650,372
---------------------------------------- ----------------- ----------------- -------------
Condensed consolidated statement of changes
in equity
for the 6 months ended 30 September 2019
Share Treasury Retained Total
capital shares earnings
reserve
GBP GBP GBP GBP
------------------------- ----------- ---------- ----------- -----------
As at 1 April 2018 42,542,179 (257,487) 22,714,092 64,998,784
Profit for the period - - 13,538,843 13,538,843
Share-based payments - 180,001 - 180,001
Dividends - - (848,903) (848,903)
As at 30 September 2018 42,542,179 (77,486) 35,404,032 77,868,725
Profit for the period - - 1,416,077 1,416,077
Share-based payments (1,858) - (1,858)
Dividends - - (848,903) (848,903)
As at 31 March 2019 42,542,179 (79,344) 35,971,206 78,434,041
Profit for the period - - 1,250,687 1,250,687
Share-based payments - - - -
Dividends - - (933,793) (933,793)
As at 30 September 2019 42,542,179 (79,344) 36,288,100 78,750,935
-------------------------- ----------- ---------- ----------- -----------
Notes to the condensed consolidated interim financial
statements
for the 6 months ended 30 September 2019
1 General information
These condensed consolidated interim financial statements are for Circle Property Plc ("the Company") and its subsidiary undertakings (together referred to as the "Group").
The Company's shares are admitted to trading on AIM, a market operated by the London Stock Exchange plc. The Company is domiciled and registered in Jersey, Channel Islands. The address of its registered office is 3rd Floor, Standard Bank House, 47-49 La Motte Street, St Helier, Jersey, JE2 4SZ.
The nature of the Company's operations and its principal activities are that of property investment in the UK.
2 Principal accounting policies
Basis of accounting
The condensed consolidated interim financial statements have been prepared in accordance with the IAS 34 "Interim Financial Reporting" and should be read in conjunction with the Group's last consolidated financial statements as at and for the year ended 31 March 2019. They do not include all of the information required for a complete set of IFRS financial statements. However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the last financial statements.
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 Chief Executive's statement. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in these financial statements.
The Group has adequate financial resources together with long term rental contracts with a wide range of tenants. As a consequence, the Directors believe that the Group is well placed to manage its business risk successfully.
The Directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they have adopted the going concern basis in preparing the interim financial statements.
Estimates and judgements
In preparing these condensed consolidated interim financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.
The significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements as at and for the year ended 31 March 2019.
3 Operating segments
During the period the Group operated in one geographical segment, which is the United Kingdom, and one reporting segment, which is investment in commercial property. Therefore, no segmental reporting is required.
4 Revenue 6 months 6 months 12 months
to 30 September to 30 to 31
2019 September March
2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ----------------- -------------- ----------
Rental income 3,339,652 3,122,433 6,390,514
SIC 15 adjustment (spreading
of lease incentives) 223,670 521,920 488,398
------------------------------------ ----------------- -------------- ----------
3,563,322 3,644,353 6,878,912
Insurance recovery 72,286 63,473 130,323
Dilapidation monies 33,000 94,000 94,000
------------------------------------ ----------------- -------------- ----------
105,286 157,473 224,323
3,668,608 3,801,826 7,103,235
---------------------------------- ----------------- -------------- ----------
5 Property expenses 6 months 6 months 12 months
to 30 September to 30 to 31
2019 September March
2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ----------------- -------------- ----------
Property expenses 11,504 41,149 76,229
Property service charges 83,437 88,343 271,493
Property repairs and maintenance
costs 8,753 - 24,788
Property insurance 76,483 74,967 148,893
Property rates 108,909 73,053 118,037
289,086 277,512 639,440
---------------------------------- ----------------- -------------- ----------
6 Administrative expenses 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ----------------- -------------- ----------
Staff costs 384,712 559,987 1,403,844
Administration fees 153,189 127,307 321,013
Legal and professional fees 344,413 468,441 788,994
Audit fees 1,928 2,004 57,084
Accountancy fees 2,105 2,593 7,164
Rent, rates and other office
costs 49,981 32,281 68,521
Other overheads 40,287 51,357 134,208
Depreciation of tangible fixed
assets 5,443 6,404 13,296
982,058 1,250,374 2,794,124
---------------------------------- ----------------- -------------- ----------
7 Finance income 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------- -------------- -------------- ----------
Bank interest 1,679 2,056 2,717
1,679 2,056 2,717
----------------------- -------------- -------------- ----------
8 Finance costs 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------- -------------- -------------- ----------
Loan interest 732,280 682,116 1,347,779
Loan commitment fees 36,217 20,716 51,219
Loan arrangement fees 90,423 35,229 108,473
858,920 738,061 1,507,471
----------------------- -------------- -------------- ----------
9 Taxation 6 months 6 months 12 months
to to to
30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------- -------------- -------------- ----------
Current tax 192,684 146,856 167,101
Deferred tax charge (337,758) 80,516 124,041
(145,074) 227,372 291,142
----------------------- -------------- -------------- ----------
10 Earnings per share
Basic earnings per share has been calculated on profit after tax attributable to ordinary shareholders for the period (as shown on the condensed consolidated statement of comprehensive income) and the weighted average number of ordinary shares in issue during the period.
6 months 6 months 12 months
to to to
30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------------------- -------------- -------------- -----------
Profit for the period 1,250,687 13,538,843 14,954,920
------------------------------------- -------------- -------------- -----------
Weighted average number of shares 28,296,762 28,296,762 28,296,792
------------------------------------- -------------- -------------- -----------
Earnings per ordinary share: 0.04 0.48 0.53
------------------------------------- -------------- -------------- -----------
In the opinion of the Board, treasury shares held to satisfy share awards to management currently do not have any material value and hence do not have any dilutive effect. Therefore, no diluted earnings per share has been presented.
11 Investment properties 30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
------------------------------------- ------------- ------------- ------------
Balance brought forward 124,600,000 114,075,000 114,075,000
Cost of refurbishment of investment
properties 404,189 594,733 826,634
Cost of acquisition of investment 15,412,420 - -
property
Disposal of investment properties (4,600,000) (2,950,000) (4,300,000)
(Loss)/Gain on revaluation of
investment properties (390,279) 11,733,347 12,609,968
Lease incentive amortisation 223,670 1,421,920 1,388,398
Fair value of investment properties
per valuation report 135,650,000 124,875,000 124,600,000
-------------------------------------- ------------- ------------- ------------
Unamortised lease incentives (9,503,492) (9,124,284) (9,279,822)
Closing fair value 126,146,508 115,750,716 115,320,178
--------------------------------------- ------------- ------------- ------------
The fair value of the Group's investment properties at 30 September 2019 has been arrived at on the basis of valuation carried out by Savills (UK) Limited. The valuation was carried out in accordance with the Practice Statements contained in the Appraisal and Valuation Standards as published by the RICS. In forming their opinion of the fair value, the independent valuer's had regard to the current best use of the property, its investment attributes and recent comparable transactions. The valuation was carried out using the "All Risks Yield" method taking into consideration both sales and rental evidence and formulating the opinion of market value taking into account the properties' locations, specifications and specific characteristics.
At 30 September 2019, the fair value of the Group's investment properties per the valuation report amounted to GBP135,650,000. The difference between the fair value of the investment properties per the valuation report and the fair value per the balance sheet of GBP9,503,942 relates to unamortised lease incentives which are recorded in the financial statements within non-current and current assets.
The Group has pledged all of its investment properties to secure banking facilities granted to the Group as detailed in note 13.
During the period the Group purchased the property at Concorde Business Park, Maidenhead for a consideration of GBP14,600,000.
During the period the Group disposed of the property at Baildon Bridge, Shipley for a consideration of GBP4,600,000.
12 Trade and other receivables 30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ------------- ------------- -------------
Non-current
Lease incentives 8,546,628 8,516,589 8,310,903
------------------------------------ ------------- ------------- -------------
Current
Lease incentives 956,864 607,695 968,919
Amounts due from property agents 15,391 104,822 20,034
Amounts due from tenants 602,316 384,760 275,540
Other receivables 236,779 145,114 289,206
1,811,350 1,242,391 1,553,699
---------------------------------- ------------- ------------- -------------
13 Borrowings 30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
---------------------------------- ------------- ------------- -------------
Brought forward 49,738,852 51,901,360 51,815,616
Loan repayments - (1,750,000) (51,901,360)
Loan drawdowns 10,261,148 - 49,738,852
Lending costs (721,900) - (721,900)
Amortisation of lending costs 113,152 (50,515) 108,473
Total borrowings 59,391,252 50,100,845 49,039,681
------------------------------------ ------------- ------------- -------------
The Group is party to a revolving facility, with NatWest and HSBC. The facility is a GBP60,000,000 revolving facility with accordion option of up to GBP40,000,000 and has a four year term. The rate of interest is the aggregate of the margin 2.05% and LIBOR and is payable quarterly. There is also a commitment fee payable at 0.82% on the undrawn facility and in relation to the accordion facility.
The facility is secured by a first and only legal charge over the Group's investment properties, an assignment of rental income, charges over specified bank accounts of the Group and a floating charge granted over all assets of the Group.
The facility's financial covenants are 60% loan to value, 2.00:1 interest cover looking both forward and backward, the Group shall ensure that the total market value of the charged properties does not fall below GBP50,000,000 at any time and that no single tenant represents more than 25% of the total contracted rents.
The Group has negotiated a facility of GBP5,000,000 under the accordion and drew down GBP1,300,000 on 4 November 2019 to cover working capital needs.
14 Trade and other payables 30 September 30 September 31 March
2019 2018 2019
(unaudited) (unaudited) (audited)
GBP GBP GBP
----------------------------- ------------- ------------- ----------
Trade payables 39,698 103,554 65,997
Property improvement costs - 72,612 -
Wages and salaries - - 454,333
Deferred income 1,611,306 1,511,160 1,638,217
Rental deposit accounts 92,546 85,586 92,545
Loan interest payable 343,033 291,074 188,339
VAT 257,413 22,379 267,442
Valuation fee 15,000 15,000 30,000
Legal and professional fees - 3,500 -
Audit fee - - 55,080
Administration fees - - 66,159
Current taxation 359,785 146,856 167,101
2,718,781 2,251,721 3,025,213
----------------------------- ------------- ------------- ----------
15 Post balance sheet event
The Group has negotiated a facility of GBP5,000,000 under the accordion and drew down GBP1,300,000 on 4 November 2019 to cover working capital needs.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR LLFIEFFLDIIA
(END) Dow Jones Newswires
December 09, 2019 02:00 ET (07:00 GMT)
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