quite a few chunky directors buys |
Quick scan of the results.
API endeavour has resulted in a 1.557m charge!
NRI was up c1.5m despite disposals (18m) which by the way have funded a pretty hefty capex activity (19m) so we need see some payback on that as voids are costing 2m pa currently. At least the inv mgt charge is reduced with the prop valuation drop so covers some of that.
Doubt this will ever get back to being able to issues shares at premia that it did regularly pre covid but divi level is good and covered. So if the big capex spend is done and with a few more disposals should be able to eliminate that expensive RCF (6.9%). |
Final results. |
Indeed. Pretty bizare really - being able to get an 8.4% yield with an NAV discount now opened up to 24%.
Opened my a/c this morning at a smidgeon under 70.6p; that = 71p all in. That darned SD really stinks when buying in a pension fund. |
@Sky topped up twice over last few weeks but another one that can't get a floor under it despite its good metrics. |
Getting tempted with the 8.33% prospective yield at 72p. Chart however suggests 70p inevitable; so finger still poised over the buy button...
free stock charts from uk.advfn.com |
nexux - thanks for clarification of the aborted API bid costs.
Not sure why the API costs should have been higher! |
Never been a regular holding, but IMO better managed than some.
Only argument I can give against is Opportunity Cost - there's higher yields (with more risk), and larger discounts, probably the latter the main argument.
Well down over 3, 5, and 10 years, but hardly uncommon for REITS (not inc reinvested divis, but even the NAV's lower over a decade).
Being down over a decade may be a Buy argument of course.
And will they attempt another merger soon.. |
 This is a relatively new investment, first acquiring a large position to equal weight my API holding (Ref: API#356) as a hedge in case the bid fell through. I’m still holding.
It has positioned its portfolio in a relatively sweet spot of high NIY assets by buying and managing many, 155, small properties, <10mn, 300+ tenants, and then driving value through asset management initiatives and selling into a receptive market for this size of asset. An approach not unlike Stenprop/Industrials where I made a lot of money; though evidently in a different property segment. The high’ish 6.5% topped-up EPRA NIY is an advantage now that ZIRP is done; providing, albeit, a small earnings enhancing margin over the cost of borrowing if it had to be re-financed today. As of FY24Q4, fixed term debt 140mn + RCF 39mn currently costing 4.1%. Fixed term debt weighted average term of 6.0 years @ 3.4%.
Regarding the costs of the failed API merger; 0.5m was reported in FY24Q3 and 0.9m reported in the recent FY24Q4 release. At last week’s Investor Meet presentation, I asked for clarification on this, and was told that the 1.4mn is pretty much it; a small final increment may be disclosed in FY25Q1. As Dr Biotech moots #374; it may be that the 5.9mn budget quoted in the merger proposal doc was the “look-through” post-merger total cost estimate including API’s.
Playing excellent defence more important than offence; so I ask the community if there are any negative issues I ought to be considering? |
Citywire figure totally wrong. API's costs exceeded £2m. |
Perhaps the 5.9m refers to expenses of the whole merged group, and would also include redundancy payments etc? |
CityWire, who get plenty wrong, reckon £900k: |
...and nothing to show for it! |
P7 of the Offer doc:
Estimate of the total expenses of the issue:
The total costs and expenses of, and incidental to, the Merger and Admission payable by the Company, are estimated to amount to approximately £5.9 million (excluding VAT). |
The Offer documentation and legals. |
@sky thats outrageous i thought API's fees were bad enough. What on earth does all this money get spent on |
Declared a few weeks ago as £5.3m |
Q4 NAV notifies of a small special top up divi of 0.3p and target 6p next year puts them on an 8% yield. Very acceptable given i only got in here after the merger debacle trashed the share price No mention though of how much that abortive approach has cost us. |
It's good, but was announced with the trading update in February. The 15% premium amounts to about £300k, which I guess pays for a small part of what they spent on the API merger attempt.
Might have hoped for more with the "..Strong demand from residential developers..".
The full proceeds would pay slightly under half of the API costs. |
Its an empty property so cash in hand and savings on operating costs. |
Nice bit of business |
Disposal at 15% premium to 31 Dec 2023 valuation. |
I'm sure you're right - yet API languishing down to 49p. In wind-down mode they look pretty likely to hit a 20%pa GRY, so looking a real bargain. |
Im sure both CREI and SHED and no doubt others will make informal offers for API assets and see if a deal can be done. |
Richard Sheperd-Cross is an exceptional CEO.Mattioli Woods/Custodian Capital needs to keep him on board .He has built an exceptional team that have intimate knowledge of their properties/ tenants. I'm sure he will now be cherry-picking the abrdn properties. |
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