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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Helical Plc | LSE:HLCL | London | Ordinary Share | GB00B0FYMT95 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 1.00 | 0.49% | 206.50 | 200.00 | 213.50 | 210.00 | 206.50 | 210.00 | 9,259 | 12:28:11 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Lessors Of Real Property,nec | 49.85M | -64.51M | -0.5230 | -3.95 | 254.73M |
From Apr 2019 to Apr 2024
TIDMHLCL
RNS Number : 1342U
Helical PLC
21 November 2019
HELICAL PLC
("Helical" or the "Group" or the "Company")
Half Year Results for the Six Months to 30 September 2019
HELICAL'S PREMIUM PORTFOLIO CONTINUES TO ATTRACT NEW TENANTS WITH 244,000 SQ FT OF LETTINGS IN LONDON & MANCHESTER SINCE APRIL 2019
Gerald Kaye, Chief Executive, commented:
"We have made good progress in the first half of the financial year by attracting new tenants to 172,860 sq ft of space, generating GBP3.9m (our share) of contracted rental income, and since 30 September 2019 have let a further 71,525 sq ft, generating an additional GBP2.1m of rental income for the Group. As we let the remaining 121,000 sq ft of available space and the 99,000 sq ft of developments due to achieve practical completion by January 2020, we will make significant headway towards capturing the portfolio's see-through ERV of GBP59.6m. The success we have had since 1 April this year underpins our belief that the enduring quality and location of our buildings will continue to attract tenants, boosting our earnings and dividend cover.
"We remain a Company focused on the creation of capital profits through the development and letting of the high quality office space that today's occupiers are seeking. Our current portfolio will continue to generate such profits as it reaches its fully let and stabilised potential. Further growth is dependent on the Group unearthing new opportunities and management's efforts are focused on achieving this. With our experience and track record, we are confident in our ability to add to our pipeline and to continue the growth of Helical."
Operational Performance
-- Acquisition of a major development opportunity with the purchase of 33 Charterhouse Street, London EC1, a c.200,000 sq ft office development site next to Farringdon station, in a 50:50 joint venture with AshbyCapital.
-- Secured 133,218 sq ft of new London office lettings delivering contracted rent of GBP9.8m (Helical's share GBP3.0m at 5.9% above 31 March 2019 ERV).
-- Post half year end, let a further 69,581 sq ft of London office space delivering GBP5.6m of contracted rents (Helical's share GBP2.1m at 3.2% above 31 March 2019 ERV).
-- In Manchester, five office lettings achieved on 39,642 sq ft, generating rental income of GBP0.9m at 1.6% above 31 March 2019 ERV, with a further 1,944 sq ft let post period end in line with 31 March 2019 ERV.
-- Completed the sale of two units in the first phase of residential at Barts Square, EC1 with a further unit completed since the period end, leaving just seven units available for sale. In the final phase, exchanged contracts for the sale of a further seven units and exchanged on one further unit since the period end, taking the total number of units exchanged to 45. These sales are due to complete by February 2020.
-- Sale of Helical's 10% shareholding in One Creechurch Place to our joint venture partner, completing our involvement in the development.
-- We increased and extended our Revolving Credit Facility to GBP400m, providing an additional GBP50m of firepower for acquisitions.
Financial Highlights
Earnings
-- IFRS basic earnings per share of 11.7p (2018: 21.8p). -- IFRS Profit before tax of GBP13.1m (2018: GBP29.1m). -- Total Accounting Return(1) of 2.7% (2018: 5.1%). -- See-through Total Property Return(1) of GBP28.6m (2018: GBP43.2m): - Group's share(1) of net rental income of GBP13.0m (2018: GBP11.7m).
- Development profits of GBP5.7m (2018: losses of GBP2.1m), after provisions of GBP1.2m (2018: GBP6.2m).
- Net gain on sale and revaluation of investment properties of GBP9.9m (2018: GBP33.6m). -- EPRA earnings per share(1) of 5.4p (2018: loss of 4.6p). -- Interim dividend declared of 2.70p per share (2018: 2.60p), up 3.8%.
Balance Sheet
-- Net asset value up 1.1% to GBP573.7m (31 March 2019: GBP567.4m). -- EPRA net asset value per share(1) up 0.8% to 486p (31 March 2019: 482p). -- EPRA triple net asset value per share(1) up 0.2% to 466p (31 March 2019: 465p).
Property Valuations
-- IFRS property portfolio value of GBP836.1m (31 March 2019: GBP793.6m). -- See-through property portfolio(1) of GBP955.8m (31 March 2019: GBP876.4m).
-- See-through investment property valuation gain, on a like-for-like basis, of 1.5% (1.4% including purchases and gains on sales).
Financing
-- See-through loan to value(1) of 35.3% (31 March 2019: 30.6%). -- See-through net borrowings(1) of GBP337.4m (31 March 2019: GBP268.6m).
-- Average maturity of the Group's share(1) of secured debt of 4.5 years (31 March 2019: 3.4 years), increasing to 5.6 years, on exercise of options to extend current facilities.
-- See-through average cost of borrowings(1) of 3.5% (31 March 2019: 4.0%).
-- Group's share(1) of cash and undrawn bank facilities at 30 September 2019 of GBP261m (31 March 2019: GBP382m).
Portfolio Update
London Portfolio
-- 1.8% valuation increase, on a like-for-like basis, valued at GBP773.9m at 30 September 2019 (85.9% of investment portfolio) compared to GBP693.8m at 31 March 2019 (85.0% of investment portfolio).
-- Contracted rents of GBP30.2m (31 March 2019: GBP27.5m) growing to an ERV of GBP50.4m (31 March 2019: GBP42.4m).
-- WAULT of 7.4 years (31 March 2019: 8.0 years).
Manchester Portfolio
-- Valuation of investment portfolio remained unchanged, on a like-for-like basis, at GBP127.0m at 30 September 2019 (14.1% of investment portfolio) compared to GBP122.7m at 31 March 2019 (15% of investment portfolio) after taking into account capital expenditure.
-- Contracted rents increased to GBP6.1m (31 March 2019: GBP5.7m) growing to an ERV of GBP9.1m (31 March 2019: GBP9.0m).
-- WAULT of 4.3 years (31 March 2019: 3.9 years).
Interim Dividend
An Interim Dividend of 2.70 pence per share (2018: 2.60 pence per share) will be paid to Shareholders as follows:
Ex-dividend Date 28 November 2019 Record Date 29 November 2019 Payable Date 31 December 2019
For further information, please contact:
Hot Features
Premium
Helical plc 020 7629 0113
Gerald Kaye (Chief Executive)
Tim Murphy (Finance Director)
Address: 5 Hanover Square, London,
W1S 1HQ
Website: www.helical.co.uk
Twitter: @helicalplc
FTI Consulting 020 3727 1000
Dido Laurimore/Richard Gotla
schelical@fticonsulting.com
Half Year Results Presentation
Helical will be holding a presentation for analysts and investors starting at 9am on Thursday 21 November 2019 at the offices of FTI Consulting, 200 Aldersgate, Aldersgate Street, London, EC1A 4HD. If you would like to attend, please contact FTI Consulting on 020 3727 1000, or email schelical@fticonsulting.com
The presentation will be on the Company's website www.helical.co.uk and a conference call facility will be available. The dial-in details are as follows:
Participants, Local - London, United Kingdom: +44 (0)330 336 9411 Passcode: 8746796
Webcast Link:
https://webcasting.brrmedia.co.uk/broadcast/5d91c523cbe3ca44a572e3b2
1. See Glossary for definition of terms. The half year condensed unaudited consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). In common with usual and best practice in our sector, alternative performance measures have also been provided to supplement IFRS, some of which are based on the recommendations of the European Public Real Estate Association ("EPRA"), with others designed to give more relevant information about the Group's share of assets and liabilities, income and expenses in subsidiaries and joint ventures.
Chief Executive's Statement
Overview
The results for the half year to 30 September 2019 reflect continued progress on all fronts.
We are rapidly approaching the completion of the current development programme, which started in March 2011 with the acquisition, in joint venture, of land and buildings at Barts Square, London EC1. On completion of the third and final phase of Barts Square and Kaleidoscope, London EC1, both anticipated by early 2020, we will have built or refurbished 2.3m sq ft of office space and delivered 236 residential units in the last nine years. Of this, we have retained 1.1m sq ft of these offices and added 200,000 sq ft at 33 Charterhouse Street, London EC1 to our investment portfolio, valued at GBP901.0m and generating GBP36.4m of contracted rent.
We have made good progress in the first half of the financial year by attracting new tenants to 172,860 sq ft of space, generating GBP3.9m (our share) of contracted rental income, and since 30 September 2019 have let a further 71,525 sq ft, generating an additional GBP2.1m of rental income for the Group. As we let the remaining 121,000 sq ft of available space and the 99,000 sq ft of developments due to achieve practical completion by January 2020, we will make significant headway towards capturing the portfolio's see-through ERV of GBP59.6m. The success we have had since 1 April this year underpins our belief that the enduring quality and location of our buildings will continue to attract tenants, boosting our earnings and dividend cover.
Results for the Half Year
The profit before tax for the half year to 30 September 2019 was GBP13.1m (2018: GBP29.1m) with a Total Property Return of GBP28.6m (2018: GBP43.2m). The increase in net rents to GBP13.0m (2018: GBP11.7m) reflects the impact of our letting success over the period. Developments contributed profits of GBP6.9m (2018: GBP4.1m) before provisions of GBP1.2m (2018: GBP6.2m). The gain on sale and revaluation of the investment portfolio contributed GBP9.9m (2018: GBP33.6m).
Total see-through finance costs were GBP8.9m (2018: GBP8.4m), offset by interest receivable of GBP1.3m (2018: GBP1.0m) to give net finance costs of GBP7.6m (2018: GBP7.4m). A reduction in expected future interest rates led to a charge from the valuation of the Group's derivative financial instruments of GBP5.0m (2018: credit of GBP0.3m). Recurring administration costs were GBP5.3m (2018: GBP5.6m) with GBP0.3m (2018: GBP0.2m) in our joint ventures. The provision for performance related remuneration, including associated NIC, was GBP1.7m (2018: GBP2.3m).
A corporation tax charge of GBP1.2m (2018: GBP11.2m) has been recognised in the Half Year Results. With a reduction in the Group's deferred tax provision of GBP2.1m, a net tax credit of GBP0.9m (2018: charge GBP3.2m) has been recognised.
The profit for the period, after recognition of this tax credit, was GBP14.0m (2018: GBP25.9m) and this result allows the Board to declare an Interim Dividend of 2.70p (2018: 2.60p), an increase of 3.8%.
Finance
The see-through loan to value ratio ("LTV") increased to 35.3% at the half year end (31 March 2019: 30.6%) reflecting the acquisition, in joint venture, of our new scheme at 33 Charterhouse Street, London EC1 and capital expenditure on our portfolio, particularly at Kaleidoscope, London EC1. Our see-through net gearing, the ratio of net borrowings to the net asset value of the Group, increased from 47.3% as at 31 March 2019 to 58.8%.
During the period under review, the average debt maturity on secured loans, on a see-through basis, increased to 4.5 years (31 March 2019: 3.4 years) as we increased and extended our Revolving Credit Facility from GBP150m to GBP400m, repaying the GBP200m development facility on The Bower. The weighted average cost of debt fell from 4.0%, at 31 March 2019, to 3.5% at the period end. Our GBP100m Convertible Bond was repaid in June 2019. The Group has GBP261m of cash and unutilised bank facilities available to fund capital works on the portfolio and future acquisitions.
Board Matters
At the 2019 AGM held in July, we said goodbye to Mike Slade, the founder and former Chief Executive of Helical, who stepped down from the Board after 35 years to be replaced as Chairman by Richard Grant. The whole Board congratulates Mike on his remarkable career and wishes him every success with his continued endeavours for charity as well as a happy and relaxing retirement.
During the period we appointed Sue Farr as an independent Non-Executive Director of the Board and a member of the Audit and Risk, Nominations and Remuneration Committees. Sue brings considerable expertise in marketing, branding and consumer issues to the team and I welcome her to the Company.
Sustainability
We have long recognised that our business impacts on the environment and the wider communities in which we operate and we seek to create sustainable buildings through our development and refurbishment activities. During the period we formalised many of our ESG policies, establishing a Sustainability Committee headed by our Property Director, Matthew Bonning-Snook, and incorporating representatives from each of our internal departments. In addition to seeking individual ratings for our portfolio under BREEAM, where we have achieved "Excellent" for all of the redeveloped properties within our London portfolio, we also look to measure and improve our corporate ESG ratings under the assessments made by EPRA, MSCI and the Carbon Disclosure Project ("CDP"). During the period, we added GRESB to the list of measures and benchmarks against which we assess our sustainability achievements.
Outlook
We operate in a climate of political uncertainty and we hope that the forthcoming General Election will provide clarity in a manner which is positive for the UK economy.
We remain a Company focused on the creation of capital profits through the development and letting of the high quality office space that today's occupiers are seeking. Our current portfolio will continue to generate such profits as it reaches its fully let and stabilised potential. Further growth is dependent on the Group unearthing new opportunities and management's efforts are focused on achieving this. With our experience and track record, we are confident in our ability to add to our pipeline and to continue the growth of Helical.
Gerald Kaye
Chief Executive
21 November 2019
Our Market
Overview
Helical's core business is developing and owning dynamic, well located office space in London and Manchester. With intelligent stock selection, we aim to maximise returns by development and refurbishment as well as through significant asset management initiatives.
London
In our judgement, the London commercial property market continues to provide the best source of capital profits in the UK. As evidenced by the continued strong tenant demand for Grade A office space, we expect this to remain the case for the foreseeable future, assuming a government supportive of business.
In order for Helical to generate capital profits, the Group needs to identify those areas where it believes tenant demand is, or will become, strong and to source opportunities in those areas at an appropriate entry price. Equally important, we need to provide inspiring working environments suited to the needs of our customers, the tenants. Using the skills, knowledge and expertise gained over many years, the Helical team aims to deliver attractive and exciting office space in our identified locations. In a low growth environment, stock selection needs to reflect the granular characteristics that will attract our target market of occupiers.
Helical has based its investment decisions in London on four continuing major developments in the office market. First, the growth of the London population; second, the continuing and rapid expansion of the creative industries (predominantly in technology and media); third, the migration of occupiers across Central London to the City and East London; and fourth, a fast-growing market in flexible leasing.
London's population is forecast to grow to 9.5m by 2026, a 9% increase since mid-2016. This will present challenges, particularly in terms of infrastructure, but will also provide opportunities, such as the demand for new and refurbished offices. Whilst the Elizabeth Line has again been delayed, its eventual opening will be a boost to travelling in London.
The UK is a global leader in the creative industries, an area we have targeted with our portfolio. Companies involved in media, advertising and marketing, technology and other creative industries now comprise 52% of our tenant base.
The third factor influencing our choice of location for our portfolio is the migration of occupiers from West to East across Central London to the City and East London. The desire to be part of creative hubs, surrounded by like-minded individuals, located a short travelling distance from home are common themes in discussing requirements with tenants. Most obviously, those hubs are in the Tech Belt from King's Cross to Whitechapel.
Finally, the growth of flexible leasing is having a continuing effect on the commercial office letting market in London and has spread to regional cities. At Helical we seek early and continued engagement with customers and look to develop long-standing relationships with them. By offering flexible leases on our multi-let assets, which allow them to occupy space commensurate with their requirements, we target long-term retention of our customers. We continue to evolve our tenant offering to reflect trends in demand, specifically with the recent introduction of fitted "plug and play" solutions on some of the buildings where we have smaller floor plates.
In London, Helical has been building up a portfolio of multi-tenanted office buildings in the Tech Belt locations of Farringdon, the Old Street roundabout and Whitechapel. We also own two assets in Chiswick, West London. By owning these "clusters" or "villages" of office buildings, the Company now has a portfolio of assets with multiple lease events leading to ongoing asset management opportunities with the potential to lock in future rental growth.
The Company is also seeking to expand its portfolio by taking on additional schemes in Central London either on its own balance sheet, or in the case of larger projects, by co-investment or by forward selling/funding them, to create the opportunity for significant profit shares but with reduced balance sheet exposure.
Manchester
Manchester continues to present attractive opportunities for us outside London and its city centre has seen the highest take-up figures on record for the first half of 2019. With 824,021 sq ft let across 124 transactions, it is well on track to exceed the five year rolling average of 1.2m sq ft. Meanwhile, Grade A office supply continues to fall and is currently at its lowest reported level.
Prime rents have risen to GBP36.50 psf and, with a lack of Grade A supply, it is likely rental growth will continue and it is expected to reach GBP40.00 psf by the end of 2020. Whilst investment volumes are significantly down in 2019, prime yields have remained steady.
Over the past decade Manchester's population has seen the greatest percentage growth outside London. Urbanisation continues, with city centre living having risen by 185% over the past 15 years. This increase has helped drive significant employment growth and this is expected to continue, predicted to increase by 11.8% over the next five years.
Manchester is well known for having the highest graduate retention rate outside London. The city's young and highly skilled workforce has seen it attract tech businesses which now occupy 35% of commercial property within the city.
As with London, we believe in clustering assets together. Our four offices are all within a ten minute walk of one another, enabling us to offer tenants a choice in design, size and rental tone and aiding in the long term retention of our tenants.
Looking Forward
Our ambition is to have a balanced portfolio that generates sufficient net rental income to firstly, exceed all of our recurring costs and second, provide a surplus significantly greater than our annual dividend to Shareholders. We have a see-through ERV on the portfolio of GBP59.6m and expect to generate this surplus once all of our current development and asset management activities are complete. We are also seeking a pipeline of opportunities to grow the balance sheet through the creation of development profits and capital surpluses.
Financial Review
IFRS Performance EPRA Performance
IFRS Profit Before Tax EPRA Earnings
GBP13.1m (2018: GBP29.1m) GBP6.5m (2018: loss of GBP5.5m)
IFRS EPS EPRA EPS
11.7p (2018: 21.8p) 5.4p (2018: loss of 4.6p)
IFRS Diluted NAV Per Share EPRA NAV Per Share
472p (31 March 2019: 469p) 486p (31 March 2019: 482p)
---------------------------------
Overview
The half year has seen continued letting success, particularly at The Tower, London EC1 and One Bartholomew, London EC1. Combined with the development progress made at Kaleidoscope, London EC1 and the recognition of the final profit on exit from One Creechurch Place, London EC3, the resultant valuation gains and development profits recognised have driven the Group's net asset growth.
With the repayment of the GBP100m Convertible Bond in June 2019 and the completion of the expanded GBP400m Revolving Credit Facility, the Group has reduced its average cost of debt whilst extending the maturity of its borrowings.
Results for the Half Year
The see-through results for the half year to 30 September 2019 include net rental income of GBP13.0m, a net gain on sale and revaluation of the investment portfolio of GBP9.9m and development profits of GBP5.7m, leading to a Total Property Return of GBP28.6m (2018: GBP43.2m). Total administration costs of GBP7.4m (2018: GBP8.0m) and net finance costs of GBP7.6m (2018: GBP7.4m) contributed to a pre-tax profit of GBP13.1m (2018: GBP29.1m). EPRA net asset value per share increased by 0.8% to 486p (31 March 2019: 482p).
The interim dividend, payable on 31 December 2019, will be 2.70p per share, a 3.8% increase on the previous interim period.
The Group's real estate portfolio, including its share of assets held in joint ventures, increased to GBP955.8m (31 March 2019: GBP876.4m) as a result of the acquisition, in joint venture, of 33 Charterhouse Street, London EC1, capital expenditure and net revaluation gains on the investment portfolio.
The expenditure on the investment portfolio during the period increased the Group's see-through loan to value to 35.3% (31 March 2019: 30.6%). Repayment of the Convertible Bond and refinancing The Bower into an expanded GBP400m Revolving Credit Facility reduced the Group's weighted average cost of debt to 3.5% (31 March 2019: 4.0%) and increased the weighted average debt maturity to 4.5 years (31 March 2019: 2.7 years). The average maturity of the facilities would increase to 5.8 years on exercise of the two one-year extension options on the Revolving Credit Facility and on a fully utilised basis.
At 30 September 2019, the Group had unutilised bank facilities of GBP210m and GBP51m of cash on a see-through basis. The bank facilities are primarily available to fund the development of Kaleidoscope, London EC1, the construction of the last phase of residential at Barts Square, London EC1 and future property acquisitions.
Total Accounting Return
The Total Accounting Return is the growth in the net asset value of the company plus dividends paid in the period, expressed as a percentage of the net asset value at the beginning of the period. The metric measures the growth in Shareholders' Funds each period and is expressed as an absolute measure.
Half Year Year Year Year Year Year
to to to to to to
2020 2019 2018 2017 2016 2015
% % % % % %
------------------------ --------- ----- ----- ----- ----- -----
Total Accounting Return 2.7 8.4 5.3 8.3 22.5 21.1
------------------------ --------- ----- ----- ----- ----- -----
Total Property Return
We calculate our Total Property Return to enable us to assess the aggregate of income and capital profits made each year from our property activities. Our business is primarily aimed at producing surpluses in the value of our assets through asset management and development, with the income side of the business seeking to cover our annual administration and finance costs.
Half Year Year Year Year Year Year
to to to to to to
2020 2019 2018 2017 2016 2015
GBPm GBPm GBPm GBPm GBPm GBPm
---------------------- --------- ----- ----- ----- ----- -----
Total Property Return 28.6 81.4 68.8 79.9 164.6 155.3
---------------------- --------- ----- ----- ----- ----- -----
Earnings Per Share
The IFRS earnings per share decreased from 21.8p to 11.7p and are based on the after tax earnings attributable to ordinary Shareholders divided by the weighted average number of shares in issue during the period.
On an EPRA basis, the loss per share of 4.6p in 2018 improved to a positive earnings per share of 5.4p, reflecting the Group's share of net rental income of GBP13.0m (2018: GBP11.7m) and development profits of GBP5.7m (2018: losses of GBP2.1m), but excluding gains on sale and revaluation of Investment properties of GBP9.9m (2018: GBP33.6m).
Net Asset Value
IFRS diluted net asset value per share increased from 469p to 472p and is a measure of shareholders' funds divided by the number of shares in issue at the period end, adjusted to allow for the effect of all dilutive share awards.
EPRA net asset value per share increased by 0.8% to 486p per share (31 March 2019: 482p). This movement arose principally from a total comprehensive income (retained profits) of GBP14.1m (2018: GBP25.9m), less GBP9.0m of dividends (2018: GBP8.3m).
EPRA triple net asset value per share marginally increased to 466p (31 March 2019: 465p).
Income Statement
Rental Income and Property Overheads
Gross rental income receivable by the Group in respect of wholly owned properties increased to GBP14.5m (2018: GBP13.5m), reflecting letting success and partial capture of the investment portfolio's reversionary potential, offset by sales of assets during the prior periods. In the joint ventures, gross rents remained steady at GBP0.4m (2018: GBP0.4m). Property overheads in respect of wholly owned assets and in respect of those assets in joint ventures fell by 20.8% to GBP1.9m (2018: GBP2.4m). After taking account of net rents receivable from our profit share partners of GBPnil (2018: GBP0.1m), see-through net rents increased to GBP13.0m (2018: GBP11.7m).
Development Profits
In the period under review, from our role as development manager at One Creechurch Place, London EC3, we recognised GBP0.8m of profit. A further profit of GBP0.9m was recognised for carrying out a similar role at Barts Square, London EC1.
Project expenditure of GBP0.4m on potential new opportunities and to satisfy cost indemnities given on the sale of our Retirement Villages in 2017, and provisions of GBP0.1m against our legacy retail development programme, combined with other net income of GBP0.2m, contributed to a net development profit of GBP1.4m (2018: GBP1.7m).
Share of Results of Joint Ventures
The revaluation of our investment assets held in joint ventures generated a surplus of GBP0.5m (2018: GBP1.1m). Under our development management agreement for One Bartholomew, London EC1, we recognised a net development fee of GBP5.4m as a result of letting progress, but a reassessment of the expected sales proceeds from the remaining units in the first phase of residential at Barts Square resulted in a provision of GBP1.1m. The sale of the Group's 10% investment in One Creechurch Place, London EC3 resulted in a profit of GBP1.3m.
Finance, administration, taxation and other sundry items added a further GBP0.7m of costs. An adjustment to reflect our economic interest in the Barts Square, London EC1 development and to ensure our investment in One Creechurch Place, London EC3 is shown at its recoverable amount, generated surpluses of GBP2.6m, leaving a net profit from our joint ventures of GBP8.0m (2018: loss of GBP3.9m).
Gain on Sale and Revaluation of Investment Properties
The valuation of our investment portfolio, on a see-through basis, continued to reflect the benefit of our refurbishment activities in London where we generated a valuation surplus of 1.7% (including purchases and gains on sales) and 1.8% on a like-for-like basis. In Manchester, the portfolio remained unchanged on a like-for-like basis. In total, the see-through investment portfolio showed a valuation surplus of 1.4% (including purchases and gains on sales), or 1.5% on a like-for-like basis.
The total impact on our results of the gain on sale and revaluation of our investment portfolio, including in joint ventures, was a net gain of GBP9.9m (2018: GBP33.6m).
Administrative Expenses
Administration costs in the Group, before performance-related awards, reduced from GBP5.6m to GBP5.3m.
Performance related share awards and bonus payments, including National Insurance costs, were GBP1.7m (2018: GBP2.3m). Of this amount, GBP0.9m (2018: GBP0.9m), being the charge for share awards under the Performance Share Plan, is expensed through the Income Statement but added back to Shareholders' Funds through the Statement of Changes in Equity.
2019 2018
GBP000 GBP000
---------------------------------------------------------------- ------- -------
Administrative expenses (excluding performance related rewards) 5,324 5,552
Performance related awards, including NIC 1,730 2,309
Group 7,054 7,861
In joint ventures 335 161
---------------------------------------------------------------- ------- -------
Total 7,389 8,022
---------------------------------------------------------------- ------- -------
Finance Costs, Finance Income and Derivative Financial Instruments
Interest payable on secured bank loans, including our share of loans on assets held in joint ventures, but before capitalised interest, reduced to GBP6.1m (2018: GBP6.3m). Interest payable in respect of the unsecured bonds was GBP0.9m (2018: GBP2.0m). Bank charges, commitment fees, sundry interest and the amortisation of refinancing costs increased to GBP3.0m (2018: GBP2.4m) due to the early repayment of The Bower facility upon the transfer of the property into the expanded Revolving Credit Facility. Capitalised interest reduced from GBP2.3m to GBP1.1m as development schemes progressed and as a result of the completion of The Tower, London EC1 in August 2018. Total finance costs, including in joint ventures, increased to GBP8.9m (2018: GBP8.4m).
Finance income earned, including in joint ventures, was GBP1.4m (2018: GBP1.1m). The movement in medium and long-term interest rate projections during the period contributed to a charge of GBP5.0m (2018: credit of GBP0.3m) on their mark-to-market valuation. The repayment of the GBP100m Convertible Bond resulted in a credit of GBP0.5m (2018: GBP1.0m) on the reversal of the 31 March 2019 mark-to-market valuation.
Taxation
Helical pays corporation tax on its UK sourced net rental income, trading and development profits and realised chargeable gains, after offsetting administration and finance costs.
The decrease in current tax charge for the period to GBP1.2m from GBP11.2m is primarily a result of the tax charge on the capital gain on the sale of The Shepherds Building, London W14 in the prior period.
Dividends
Helical follows a progressive dividend policy of increasing its dividends whilst retaining the majority of funds generated for investment to grow the business. As the Group completes and lets its current development programme, it expects to be able to reflect the growth in earnings in increased dividends paid to Shareholders. The Company has proposed an interim dividend of 2.70p, an increase of 3.8% on the previous period (2018: 2.60p).
Balance Sheet
Shareholders' Funds
Shareholders' Funds at 1 April 2019 were GBP567.4m. The Group's results for the period added GBP14.1m (2018: GBP25.9m), net of tax, representing the total comprehensive income for the period. Movements in reserves arising from the Group's share schemes increased funds by GBP1.2m. The Company paid dividends to Shareholders amounting to GBP9.0m leaving a net increase in Shareholders' Funds from Group activities during the period of GBP6.3m to GBP573.7m.
Investment Portfolio
Head
Wholly In joint leases Lease Book
owned venture See-through capitalised incentives value
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------- ----------------- ------- -------- ----------- ------------ ----------- -------
Valuation at 31 March 2019 791,250 25,382 816,632 2,189 (14,781) 804,040
Acquisitions - wholly owned - - - - - -
- joint ventures - 37,114 37,114 - - 37,114
Capital expenditure - wholly owned 31,965 - 31,965 (21) - 31,944
- joint ventures - 2,698 2,698 - - 2,698
Revaluation
surplus - wholly owned 11,885 - 11,885 - (2,443) 9,442
- joint ventures - 676 676 - (204) 472
Valuation at 30 September
2019 835,100 65,870 900,970 2,168 (17,428) 885,710
--------------------------------------- ------- -------- ----------- ------------ ----------- -------
In the period to 30 September 2019, the Group acquired 33 Charterhouse Street, London EC1 in joint venture for GBP37.1m (our share). The Group spent GBP34.7m on capital works on the investment portfolio, mainly at Kaleidoscope, London EC1 (GBP20.6m), The Tower, London EC1 (GBP6.6m), Barts Square, London EC1 (GBP1.7m), The Tootal Buildings (formally called Churchgate and Lee), Manchester (GBP3.2m) and Fourways House, Manchester (GBP0.9m). Revaluation gains added GBP12.6m to increase the see-through value of the portfolio, before lease incentives, to GBP901.0m (31 March 2019: GBP816.6m). The accounting for head leases and lease incentives resulted in a book value of the see-through investment portfolio of GBP885.7m (31 March 2019: GBP804.0m).
Debt and Financial Risk
In total, Helical's outstanding debt at 30 September 2019 of GBP395.2m (31 March 2019: GBP479.2m) had a weighted interest cost of 3.5% (31 March 2019: 4.0%) and a weighted average debt maturity of 4.5 years (31 March 2019: 2.7 years). The average maturity of the facilities would increase to 5.8 years following exercise of the two one-year extensions of the Group's GBP400m Revolving Credit Facility on a fully utilised basis.
Debt Profile at 30 September 2019 - Including Commitment Fees but Excluding the Amortisation of Arrangement Fees
Total Total Weighted average Average
facility utilised Available facility interest rate maturity Extended* average
GBP000 GBP000 GBP000 % Years maturity Years
----------------------- --------- --------- ------------------ ---------------- --------- ----------------------
Investment facilities 493,000 314,000 179,000 3.2 4.9 6.5
Development facilities 50,400 32,770 17,630 4.9 3.9 3.9
----------------------- --------- --------- ------------------ ---------------- --------- ----------------------
Total wholly owned 543,400 346,770 196,630 3.4 4.8 6.2
In joint ventures 51,684 48,446 3,238 3.9 2.3 2.3
----------------------- --------- --------- ------------------ ---------------- --------- ----------------------
Total secured debt 595,084 395,216 199,868 3.5 4.5 5.9
Working capital 10,000 - 10,000 - - 1.0
Total unsecured debt 10,000 - 10,000 - - 1.0
----------------------- --------- --------- ------------------ ---------------- --------- ----------------------
Total debt 605,084 395,216 209,868 3.5 4.5 5.8
----------------------- --------- --------- ------------------ ---------------- --------- ----------------------
* Calculated on a fully utilised basis with the two one-year extensions of the Revolving Credit Facility included.
Secured Debt
The Group arranges its secured investment and development facilities to suit its business needs as follows:
- Investment Facilities
We have a GBP400m Revolving Credit Facility that enables the Group to acquire, refurbish, reposition and hold significant parts of our investment portfolio with the remaining London investment assets held in a GBP93m term loan secured facility. The value of the Group's properties secured in these facilities at 30 September 2019 was GBP717m (31 March 2019: GBP698m) with a corresponding loan to value of 43.8% (31 March 2019: 44.4%). The average maturity of the Group's investment facilities at 30 September 2019 was 4.9 years (31 March 2019: 3.5 years), increasing to 6.5 years on a fully utilised basis and following the two one-year extensions of the Revolving Credit Facility. The weighted average interest rate was 3.2% (31 March 2019: 3.9%). The marginal cost of fully utilising the undrawn Revolving Credit Facility was 2.2% (31 March 2019: 2.1%).
- Development Facilities
This facility finances the over-station development at Kaleidoscope, London EC1. The maturity of the Group's development facility at 30 September 2019 was 3.9 years (31 March 2019: 4.4 years) with a weighted average interest rate of 4.9% (31 March 2019: 6.3%). Excluding the impact of commitment fees, the weighted average interest rate of this facility is 4.2% (31 March 2019: 4.2%).
- Joint Venture Facilities
We hold a number of investment and development properties in joint venture with third parties and include in our reported figures our share, in proportion to our economic interest, of the debt associated with each asset. The average maturity of the Group's share of bank facilities in joint ventures at 30 September 2019 was 2.3 years (31 March 2019: 2.8 years) with a weighted average interest rate of 3.9% (31 March 2019: 4.0%).
Unsecured Debt
The Group's unsecured debt, following the repayment of the GBP100m Convertible Bond in June 2019, is GBPnil (31 March 2019: GBP100.5m), as follows:
- Short-term Working Capital Facilities
These undrawn facilities provide access to additional working capital for the Group.
Cash and Cash Flow
At 30 September 2019, the Group had GBP261m (31 March 2019: GBP382m) of cash and agreed, undrawn, committed bank facilities including its share in joint ventures, as well as GBP62m (31 March 2019: GBP25m) of uncharged property on which it could borrow funds.
Net Borrowings and Gearing
Total gross borrowings of the Group, including in joint ventures, have decreased from GBP479.2m to GBP395.2m during the six month period to 30 September 2019. After deducting cash balances of GBP51.3m (31 March 2019: GBP205.2m) and unamortised refinancing costs of GBP6.6m (31 March 2019: GBP5.4m), net borrowings increased from GBP268.6m to GBP337.4m. The see-through gearing of the Group, including in joint ventures, increased from 47.3% to 58.8%.
30 September 31 March
2019 2019
------------------------------------------- ------------ ---------
See-through gross borrowings GBP395.2m GBP479.2m
See-through cash balances GBP51.3m GBP205.2m
Unamortised refinancing costs GBP6.6m GBP5.4m
See-through net borrowings GBP337.4m GBP268.6m
Shareholders' Funds GBP573.7m GBP567.4m
See-through gearing - IFRS net asset value 58.8% 47.3%
------------------------------------------- ------------ ---------
Hedging
At 30 September 2019, the Group had GBP243.0m (31 March 2019: GBP363.0m) of fixed rate debt with an average effective interest rate of 3.0% (31 March 2019: 3.7%) and GBP103.8m (31 March 2019: GBP67.2m) of floating rate debt with an average effective interest rate of 4.4% (31 March 2019: 5.7%). In addition, the Group had GBP200m of interest rate caps at an average of 1.75% (31 March 2019: GBP240m at 1.69%). In our joint ventures, the Group's share of fixed rate debt was GBPnil (31 March 2019: GBPnil) and GBP48.4m (31 March 2019: GBP49.0m) of floating rate debt with an effective rate of 3.9% (31 March 2019: 4.0%), with interest rate caps set at 1.5% plus margin on GBP32.9m (31 March 2019: GBP11.0m at 0.5%).
30 September 31 March
2019 Effective interest rate 2019 Effective interest rate
GBPm % GBPm %
--------------------------------- ------------ ----------------------- -------- -----------------------
Fixed rate debt
- Secured borrowings 243.0 3.0 262.5 3.6
- Convertible Bond - - 100.0 4.0
- Fair value of Convertible Bond - - 0.5 -
--------------------------------- ------------ ----------------------- -------- -----------------------
Total 243.0 3.0 363.0 3.7
Floating rate debt
- Secured 103.8 4.4(1) 67.2 5.7(1)
--------------------------------- ------------ ----------------------- -------- -----------------------
Total 346.8 3.4 430.2 4.0
In joint ventures
- Floating rate 48.4 3.9 49.0 4.0
--------------------------------- ------------ ----------------------- -------- -----------------------
Total borrowings 395.2 3.5 479.2 4.0
--------------------------------- ------------ ----------------------- -------- -----------------------
(1) This includes commitment fees on undrawn facilities. Excluding these would reduce the effective rate to 3.1% (31 March 2019: 3.7%).
Tim Murphy
Finance Director
21 November 2019
Helical's Property Portfolio - 30 September 2019
Property Overview
Helical divides its property activities into two core markets: London and Manchester offices. London represents 87% and Manchester 13% of the total see-through property portfolio. Whilst there are structural differences in these markets, Helical has found that its business model can be applied successfully to each, driving capital growth, development profits and rental income.
The London Portfolio
Our strategy is to continue to increase our London holdings, focusing on areas where we see strong tenant demand and growth potential, such as the "Tech Belt" that runs from King's Cross through Old Street and Shoreditch to Whitechapel. Our London portfolio comprises income-producing multi-let offices, office refurbishments and developments and a mixed use commercial/residential scheme.
33 Charterhouse Street, EC1
In May 2019 we acquired the rights to a long leasehold interest in 33 Charterhouse Street, a major development site located in Farringdon, in a 50:50 joint venture with AshbyCapital. The site is situated on the corner of Charterhouse Street and Farringdon Road, adjacent to Farringdon Station and immediately opposite the future Museum of London site at Smithfield General Market.
Since acquisition, extensive work has been undertaken to refine the existing planning consent such that the building is now expected to provide for c.190,000 sq ft of offices across ten floors and c.10,000 sq ft of ground floor retail. Work on site will commence shortly and completion is anticipated in Spring 2022.
The Bower, EC1
The Bower is a landmark estate immediately adjacent to the Old Street roundabout and features 312,575 sq ft of innovative, high quality office space along with 21,280 sq ft of restaurant and retail space.
The Warehouse and The Studio
The Warehouse comprises 122,858 sq ft of offices and The Studio 18,283 sq ft of offices with 10,298 sq ft of retail space at the two buildings. The repositioning of The Warehouse entailed a complete refurbishment of the building whilst retaining its original 1960s characteristics. The Studio was a ground up development on the former car park site. The buildings were fully pre-let when they completed in November 2015.
The Tower
The Tower offers 171,434 sq ft of office space with a contemporary façade and innovatively designed interconnecting floors, along with 10,982 sq ft of restaurant space let to Albion & East (trading as Serata Hall) and Wagamama.
In the period we have let the 14th floor on a fitted basis to Snowflake Computing, the cloud-built data warehouse solutions provider, and the 16th floor to Incubeta, a global digital marketing performance group. Since the period end the 12th floor has also been let, on a fitted basis, to an existing tenant, Brilliant Basics, an Infosys company and the 13th floor to OpenPayd, a banking and payments platform for businesses. Following these lettings, The Tower is now 93% let with only the 15th floor available.
Barts Square, EC1
In a joint venture with The Baupost Group LLC, Helical owns the freehold interest of Barts Square, a 3.2 acre site between St Paul's and Smithfield Market, situated a short walk from the Farringdon East Elizabeth Line station.
Barts Square provides a new quarter in the City, consisting of 236 residential apartments, three office buildings of 214,434 sq ft, 24,013 sq ft and 10,187 sq ft together with 21,122 sq ft of retail/A3 at ground floor as well as major public realm improvements.
Phase One
Residential/Retail
Phase One of Barts Square comprises 144 residential units, 3,101 sq ft of retail space and extensive public realm improvements. In the period we completed the sales of two residential units taking the total sales to 136 residential units, with a total value of GBP173.9m at an average price of GBP1,555 psf. Following the completion of one further sale after the period end, seven apartments remain available. The landscaping of the new public square has been completed with the restaurant space let to Stem + Glory and Halfcup.
90 Bartholomew Close - Office/Restaurant
The 24,013 sq ft office building, with 6,414 sq ft of restaurant space, completed in March 2018. In the period we let the fourth and fifth floors to Sia Partners, taking the building to 61% let. Since the end of the period, we have let all of the remaining floors with the second floor let as expansion space to an existing Helical tenant on a fitted basis, the third floor to Constantine Cannon and the sixth floor to Eric Salmon.
Phase Two
One Bartholomew - Offices
One Bartholomew was sold to clients of AshbyCapital for GBP102.4m in August 2015. The demolition of the existing building and the construction of a new 12 storey Grade A office block of 214,434 sq ft commenced in January 2016 and completed in December 2018. AshbyCapital's clients financed the development costs and now that the building is completed and successfully let, the joint venture is entitled to receive a profit share payment.
During the period, we have let the ground, first and second floors to The University of Chicago Booth School of Business, the sixth floor to Sopra Steria and the seventh floor to InfraRed Capital Partners, taking the building to 73% let. Since the period end the third and fourth floors have been let to BDB Pitmans taking the building to 91% let, with only the fifth floor available.
Phase Three
Residential/Retail
Construction works on Phase Three of Barts Square are nearing completion with the first block having reached practical completion in November 2019 and the remaining two due to complete in January and February 2020. This phase comprises 92 apartments and 11,607 sq ft of retail space. During the period, contracts were exchanged on seven units, taking the total number of units exchanged to 44, at a value of GBP69.7m and an average price of GBP1,793 psf. Following exchange on one further unit since the period end, 46 units are available for sale and one additional unit that will be released at a later date.
55 Bartholomew
With completion of this refurbishment project due in December 2019 we have commenced marketing of the newly created 10,187 sq ft of office space spread over five floors. The works comprised the substantial refurbishment and extension of the original building and the addition of a new fifth floor.
Kaleidoscope, EC1
The over-station development at the Farringdon East Elizabeth Line station, which will comprise a six storey 86,183 sq ft office building, with a 2,497 sq ft restaurant unit on the ground floor, is due to complete in January 2020. The building sits immediately east of Smithfield Market with views over Charterhouse Square and towards St Paul's Cathedral. The building is being marketed with good interest being expressed by potential tenants.
The Loom, E1
This 108,610 sq ft building is one of London's few remaining former Victorian wool warehouses and was acquired in 2013. Works to transform this asset completed in September 2016 and included a new entrance and reception onto Gowers Walk, a café, showers and a bike store. The Loom has won both a RIBA London and National Award as well as an Architects Journal Retrofit Award.
Since 1 April 2019, we have let three units at a premium to 31 March 2019 ERVs taking the building to 97% let.
25 Charterhouse Square, EC1
In January 2016, Helical was granted a new 155 year leasehold interest in 25 Charterhouse Square from the Governors of Sutton's Hospital in Charterhouse for GBP16m. The building is a Grade A office adjacent to the new Farringdon East station on the Elizabeth Line and overlooks the historic Charterhouse Square. Helical carried out a major refurbishment of the existing building, which increased the previous 34,000 sq ft to 38,355 sq ft of offices with the addition of a new sixth floor, and 5,138 sq ft of retail space. The building achieved practical completion on 28 March 2017 and was fully let to Anomaly, Peakon, Hudson Sandler and Senator International by December 2017, less than two years after it was acquired.
Power Road Studios, W4
The site comprises 57,164 sq ft of offices across four studio buildings and is multi-let to a wide range of predominantly media tenants. In October 2017 we completed the refurbishment of Studio 1, a project comprising c.16,000 sq ft of Grade A space, refurbished common parts and added two new lift shafts to accommodate a consented future roof extension of 13,000 sq ft. We have also secured planning consent for a new 30,000 sq ft building.
In the period we have completed five lettings representing 16,160 sq ft, at a 10.8% average premium to 31 March 2019 ERVs taking the building to 88% let.
The Powerhouse, W4
Helical acquired this 24,288 sq ft office and recording studios by way of sale and leaseback in 2013. The Powerhouse is a listed building on Chiswick High Road and is fully let on a long lease to Metropolis Music Group.
One Creechurch Place, EC3
The sale of our 10% shareholding in One Creechurch Place to our joint venture partner, HOOPP, took place in September 2019, completing our involvement in the development.
The Manchester Portfolio
Manchester is a city with a diverse, thriving and growing economy that is widely regarded as England's second city and the centre of the "Northern Powerhouse". Helical has found that the approach it applies to development and asset management in London is equally well received by the tenants in Manchester.
The Tootal Buildings, Manchester
The buildings, formally referred to as Churchgate and Lee, comprise 243,666 sq ft of multi-let offices. The assets were 64% let when acquired in March 2014. Since their purchase, we have refurbished the Churchgate House reception and 94,493 sq ft of office space, with a further 46,739 sq ft currently being refurbished as expansion space for an existing tenant. In the period we have completed the lettings of the recently refurbished third floor in Churchgate House and the sixth and seventh floors in Lee House to Capita Business Services. Following the completion of these lettings the building is now fully let. We continue to actively manage the buildings, with a recently completed full refurbishment of the reception at Lee House.
35 Dale Street, Manchester
35 Dale Street is a 56,124 sq ft office building situated in the Northern Quarter of Manchester, acquired in March 2015. The building underwent a comprehensive refurbishment which completed in June 2018. During the period Couchbase have taken occupation of the newly reconfigured former loading bay for office use.
Trinity, Manchester
Trinity, purchased in May 2017 for GBP12.9m, underwent a full redevelopment which completed in January 2019. The repositioned building comprises 54,651 sq ft of office space and 4,300 sq ft of retail/restaurant space, both of which are available to let.
Fourways House, Manchester
This 58,369 sq ft brick built Grade 2 listed former packing warehouse was acquired in July 2018 for GBP16.5m, representing a net initial yield of 5.3%. We have begun our management programme and have let two units in the period at a 12.7% premium to 31 March 2019 ERVs and have let a further unit since the period end. We have recently obtained planning permission to undertake a significant refurbishment of the atrium and common parts and works will commence shortly, with completion expected in July 2020.
Portfolio Analytics
See-through Valuation Movements
Investment
portfolio Investment portfolio
Val change Val change weighting weighting
inc purchases & gains on sales excl purchases & gains on sales 30 September 2019 31 March 2019
% % % %
------------ ------------------------------- -------------------------------- ------------------ --------------------
London
Offices
- Completed,
let and
available
to let 1.4 1.4 70.2 75.3
- Being
redeveloped 2.6 3.9 15.7 9.7
------------ ------------------------------- -------------------------------- ------------------ --------------------
Total London 1.7 1.8 85.9 85.0
Manchester
Offices
- Completed,
let and
available
to let 0.0 0.0 14.1 15.0
Total
Manchester 0.0 0.0 14.1 15.0
------------ ------------------------------- -------------------------------- ------------------ --------------------
Total 1.4 1.5 100.0 100.0
------------ ------------------------------- -------------------------------- ------------------ --------------------
See-through Total Portfolio by Fair Value
Investment Development Total
GBPm % GBPm % GBPm %
-------------------------- ---------- ----- ----------- ----- ----- -----
London Offices
- Completed, let
and available to let 632.7 70.2 - - 632.7 66.2
- Being redeveloped 141.2 15.7 - - 141.2 14.8
- Held for redevelopment - - 0.3 0.5 0.3 0.0
London Residential - - 53.2 97.1 53.2 5.6
-------------------------- ---------- ----- ----------- ----- ----- -----
Total London 773.9 85.9 53.5 97.6 827.4 86.6
Manchester Offices
- Completed, let
and available to let 127.0 14.1 - - 127.0 13.3
--------------------------
Total Manchester 127.0 14.1 - - 127.0 13.3
Total Core Portfolio 900.9 100.0 53.5 97.6 954.4 99.9
Other 0.1 0.0 - - 0.1 0.0
Regional Retail - - 0.7 1.3 0.7 0.1
Land - - 0.6 1.1 0.6 0.0 -------------------------- ---------- ----- ----------- ----- ----- ----- Total Non-Core Portfolio 0.1 0.0 1.3 2.4 1.4 0.1 Total 901.0 100.0 54.8 100.0 955.8 100.0 -------------------------- ---------- ----- ----------- ----- ----- -----
See-through Trading and Development Portfolio
Book value Fair value Surplus Fair value
GBPm GBPm GBPm %
------------------------- ---------- ---------- ------- ----------
London Offices 0.3 0.3 - 0.5
London Residential 53.2 53.2 - 97.1
------------------------- ---------- ---------- ------- ----------
Total Core Portfolio 53.5 53.5 - 97.6
Regional Retail 0.7 0.7 - 1.3
Land - 0.6 0.6 1.1
------------------------- ---------- ---------- ------- ----------
Total Non-Core Portfolio 0.7 1.3 0.6 2.4
Total 54.2 54.8 0.6 100.0
------------------------- ---------- ---------- ------- ----------
Capital Expenditure
We have a committed and planned development and refurbishment programme.
Capex Total
budget Remaining spend Pre-redeveloped completed
(Helical share) (Helical share) space New space space Completion
Property GBPm GBPm sq ft sq ft sq ft date
--------------- ---------------------- --------------- --------------- --------- -------------- --------------
Investment -
committed
The Tower,
London EC1 109.8 5.7 114,000 68,416 182,416 Completed
Kaleidoscope,
London EC1(1) 59.0 16.3 - 88,680 88,680 January 2020
55 Bartholomew,
London EC1 2.4 0.4 9,000 1,187 10,187 December 2019
Investment -
planned
33 Charterhouse Street,
London EC1 62.8 62.0 - 200,000 200,000 H1 2022
Development -
committed
Barts Square, London EC1 -
Phase One 64.7 0.3 - 127,364 127,364 Completed
November 2019
to February
2020
Barts Square, London EC1 - in three
Phase Three 39.8 4.5 - 89,383 89,383 phases
----------------------------- -------- --------------- --------------- --------- -------------- --------------
1. Includes deferred consideration payment due in April 2020.
Asset Management
Asset management is a critical component in driving Helical's performance. Through having well considered business plans and maximising the combined skills of our management team, we are able to create value in our assets.
Fair
value Passing ERV change
weighting rent Contracted rent ERV like-for-like
See-through Investment portfolio % GBPm % GBPm % GBPm % %
------------------------------------ ---------- ------- ----- --------------- ----- ----- ----- --------------
London Offices
- Completed, let and available to
let 70.2 22.6 82.7 30.2 83.2 35.1 58.9 0.7
- Being redeveloped 15.7 - - - - 15.3 25.7 0.1
Total London 85.9 22.6 82.7 30.2 83.2 50.4 84.6 0.6
Manchester Offices
- Completed, let and available to
let 14.1 4.7 17.2 6.1 16.7 9.1 15.3 1.4
Total Manchester 14.1 4.7 17.2 6.1 16.7 9.1 15.3 1.4
Other - 0.1 0.1 0.1 0.1 0.1 0.1 -
------------------------------------ ---------- ------- ----- --------------- ----- ----- ----- --------------
Total 100.0 27.4 100.0 36.4 100.0 59.6 100.0 0.7
------------------------------------ ---------- ------- ----- --------------- ----- ----- ----- --------------
During the period, total contracted income increased by GBP3.2m as a result of new lettings and rent reviews.
See-through
total portfolio contracted rent
GBPm
-------------------------------------------------------------- --------------------------------
Rent lost at break/expiry (0.8)
Rent reviews and uplifts on lease renewals 0.1
New lettings
- London 3.0
- Manchester 0.9
-------------------------------------------------------------- --------------------------------
Total increase in the period from asset management activities 3.2
-------------------------------------------------------------- --------------------------------
Total contracted rental change from sales and purchases -
-------------------------------------------------------------- --------------------------------
Net increase in contracted rents in the period 3.2
-------------------------------------------------------------- --------------------------------
Investment Portfolio
Portfolio Yields
EPRA topped EPRA topped Reversionary Reversionary
up NIY up NIY yield yield True equivalent yield True equivalent yield
30 September 31 March 30 September 31 March 30 September 31 March
2019 2019 2019 2019 2019 2019
% % % % % %
--------------- --------------- ----------- ------------- ------------ --------------------- ---------------------
London Offices
- Completed, let and
available to let 4.5 4.2 5.2 5.2 5.1 5.1
- Being
redeveloped n/a n/a 5.3 5.7 4.9 4.9
--------------- --------------- ----------- ------------- ------------ --------------------- ---------------------
Total London 4.5 4.2 5.2 5.3 5.0 5.1
Manchester
Offices
- Completed, let and
available to let 4.6 4.2 6.3 6.3 6.1 6.1
Total
Manchester 4.6 4.2 6.3 6.3 6.1 6.1
Total 4.5 4.2 5.4 5.4 5.2 5.2
--------------- --------------- ----------- ------------- ------------ --------------------- ---------------------
See-through Capital Values, Vacancy Rates and Unexpired Lease Terms
30 September 2019 30 September 2019 30 September 2019 31 March 2019
Capital value psf Vacancy rate WAULT WAULT
GBP % Years Years
-------------------------------------- ------------------ ----------------- ----------------- -------------
London Offices
- Completed, let and available to let 1,090 8.9 7.4 8.0
- Being redeveloped 610 n/a n/a n/a
-------------------------------------- ------------------ ----------------- ----------------- -------------
Total London 927 8.9 7.4 8.0
Manchester Offices
- Completed, let and available to let 304 17.7 4.3 3.9
Total Manchester 304 17.7 4.3 3.9 Total 731 12.5 6.9 7.3 -------------------------------------- ------------------ ----------------- ----------------- -------------
See-through Lease Expiries or Tenant Break Options
Period to Year to Year to Year to Year to
2020 2021 2022 2023 2024
----------------------------- --------- ------- ------- ------- -------
% of rent roll 3.1 6.0 11.5 10.4 12.8
Number of leases 17 20 31 19 24
Average rent per lease (GBP) 66,689 109,858 134,432 200,005 193,356
----------------------------- --------- ------- ------- ------- -------
Top 10 Tenants
We have a strong rental income stream and a diverse tenant base. The top 10 tenants account for 47.6% of the total rent roll and the tenants come from a variety of industries.
Contracted rent Rent roll
Rank Tenant Tenant Industry GBPm %
------ -------- ------------------ --------------- ---------
1 Farfetch Online retail 3.9 10.8
2 WeWork Flexible offices 3.8 10.5
3 Pivotal Technology 2.0 5.5
4 Infosys Technology 1.4 3.9
5 Anomaly Marketing 1.4 3.9
6 CBS Media 1.0 2.9
7 Allegis Recruitment 1.0 2.7
8 Finablr Financial services 0.9 2.6
9 Incubeta Marketing 0.9 2.5
10 Stripe Technology 0.8 2.3
------ -------- ------------------
Total 17.1 47.6
---------------- ------------------ --------------- ---------
Principal Lettings During the Period
Lease term
Area to expiry
Property Tenant sq ft years
--------------------------------- ---------------------------------------- ------- ----------
The Tower, London EC1 Incubeta 11,306 10
The Tower, London EC1 Snowflake Computing 9,568 5
The Tootal Buildings, Manchester Capita Business Services 35,118 11
Power Road Studios, London W4 So Energy 7,135 5
90 Bartholomew Close, London EC1 Sia Partners 7,564 10
Power Road Studios, London W4 HOPP 5,495 3
The Loom, London E1 UI Centric 3,048 5
The Loom, London E1 Qbic Hotels 1,407 3
The Loom, London E1 Oyster Information Management Solutions 1,706 10
Power Road Studios, London W4 Kobayashi Healthcare 1,971 5
--------------------------------- ---------------------------------------- ------- ----------
Letting Activity
Contracted Rent Rent % Above
Area (Helical's Share) per sq ft 31 March 2019 ERV
sq ft GBP GBP %
------------------------------------- ------- ------------------ ---------- ------------------
Investment Properties
London Offices
The Tower, The Bower, EC1 20,874 1,726,000 82.69 2.4(1)
The Loom, E1 6,161 359,000 58.22 10.4
Power Road Studios, W4 16,160 682,000 41.53 10.8
90 Bartholomew Close, EC1 7,564 245,000 74.05 0.9
------------------------------------- ------- ------------------ ---------- ------------------
Total London 50,759 3,012,000 59.34 5.9
Manchester Offices
The Tootal Buildings 35,118 755,000 21.50 0.1
Fourways House 4,524 120,000 26.51 12.7
------------------------------------- ------- ------------------ ---------- ------------------
Total Manchester 39,642 875,000 22.07 1.6
------------------------------------- ------- ------------------ ---------- ------------------
Total 90,401 3,887,000 43.00 4.7
------------------------------------- ------- ------------------ ---------- ------------------
Development Properties
London Offices
One Bartholomew, EC1 82,459 - 78.96 n/a
------------------------------------- ------- ------------------ ---------- ------------------
1. Excludes leases on a fitted basis.
Statement of Directors' Responsibilities
We confirm that to the best of our knowledge:
a) The condensed unaudited consolidated financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting';
b) The interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events and their impact during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
c) The interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
Balances with related parties at 30 September 2019, 30 September 2018 and 31 March 2019 are disclosed in Note 25.
A list of current Directors is maintained at 5 Hanover Square, London, W1S 1HQ and at www.helical.co.uk.
The half year statement was approved by the Board on 21 November 2019 and is available from the Company's registered office at 5 Hanover Square, London, W1S 1HQ and on the Company's website at www.helical.co.uk.
On behalf of the Board
Tim Murphy
Finance Director
21 November 2019
Independent Review Report to the Members of Helical plc
Introduction
We have been engaged by the Company to review the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2019 which comprises the Unaudited Consolidated Income Statement, Unaudited Consolidated Statement of Comprehensive Income, Unaudited Consolidated Balance Sheet, Unaudited Consolidated Cash Flow Statement and Unaudited Consolidated Statement of Changes in Equity, the cash flow statement and related notes 1 to 29. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.
This report is made solely to the company in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Financial Reporting Council. Our work has been undertaken so that we might state to the company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.
As disclosed in Note 1, the annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" as adopted by the European Union.
Our Responsibility
Our responsibility is to express to the Company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Financial Reporting Council for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the six months ended 30 September 2019 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure Guidance and Transparency Rules of the United Kingdom's Financial Conduct Authority.
Deloitte LLP
Statutory Auditor
London, United Kingdom
21 November 2019
Unaudited Consolidated Income Statement
For the Half Year to 30 September 2019
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
Notes GBP000 GBP000 GBP000
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Revenue 3 22,055 23,395 44,175
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Net rental income 4 12,811 11,747 24,599
Development property profit/(loss) 5 1,441 1,686 (1,781)
Share of results of joint ventures 13 7,982 (3,874) (3,217)
Other operating income 44 4 -
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Gross profit before net gain on sale and revaluation of
Investment properties 22,278 9,563 19,601
(Loss)/gain on sale of Investment properties 6 (28) 1,102 15,008
Revaluation of Investment properties 12 9,442 31,435 44,284
Change in fair value of available-for-sale investments 16 - 144 144
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Gross profit 31,692 42,244 79,037
Administrative expenses 7 (7,054) (7,861) (16,753)
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Operating profit 24,638 34,383 62,284
Finance costs 8 (8,315) (7,616) (17,407)
Finance income 1,311 1,033 983
Change in fair value of derivative financial instruments 22 (4,980) 325 (3,322)
Change in fair value of Convertible Bond 468 958 865
Foreign exchange gain 9 65 53
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Profit before tax 13,131 29,148 43,456
Tax on profit on ordinary activities 9 898 (3,224) (836)
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Profit for the period 14,029 25,924 42,620
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Earnings per share 11
Basic 11.7p 21.8p 35.8p
Diluted 11.6p 21.6p 35.3p
------------------------------------------------------------ ----- ------------------ ------------------ ---------
Unaudited Consolidated Statement of Comprehensive Income
For the Half Year to 30 September 2019
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------------------------------- ------------------ ------------------ ---------
Profit for the period 14,029 25,924 42,620
Exchange difference on retranslation of net investments in foreign
operations 55 (47) (51)
------------------------------------------------------------------- ------------------ ------------------ ---------
Total comprehensive income for the period 14,084 25,877 42,569
------------------------------------------------------------------- ------------------ ------------------ ---------
The exchange differences on retranslation of net investments in foreign operations will be reclassified to the Income Statement on disposal.
Unaudited Consolidated Balance Sheet
At 30 September 2019
At
At At 31 March
30 September 2019 30 September 2018 2019
Notes GBP000 GBP000 GBP000
--------------------------------------------- ----- ------------------ ------------------ ---------
Non-current assets
Investment properties 12 820,138 744,850 778,752
Owner occupied property, plant and equipment 6,394 1,783 1,747
Investment in joint ventures 13 78,073 31,519 24,676
Derivative financial instruments 22 319 1,703 915
--------------------------------------------- ----- ------------------ ------------------ ---------
904,924 779,855 806,090
--------------------------------------------- ----- ------------------ ------------------ ---------
Current assets
Land, developments and trading properties 14 1,035 4,048 2,311
Investment property held for sale 15 - 125,200 -
Trade and other receivables 17 36,539 98,700 58,726
Cash and cash equivalents 18 47,726 63,093 197,570
--------------------------------------------- ----- ------------------ ------------------ ---------
85,300 291,041 258,607
--------------------------------------------- ----- ------------------ ------------------ ---------
Total assets 990,224 1,070,896 1,064,697
--------------------------------------------- ----- ------------------ ------------------ ---------
Current liabilities
Trade and other payables 19 (52,539) (55,652) (43,159)
Lease liability 20 (599) - -
Corporation tax payable (280) (6,874) (2,561)
Borrowings 21 - (100,375) (100,468)
--------------------------------------------- ----- ------------------ ------------------ ---------
(53,418) (162,901) (146,188)
--------------------------------------------- ----- ------------------ ------------------ ---------
Non-current liabilities
Borrowings 21 (340,603) (332,290) (324,814)
Derivative financial instruments 22 (8,017) (1,529) (4,158)
Lease liability 20 (7,872) (2,189) (2,189)
Trade and other payables 19 (590) (10,815) (11,405)
Deferred tax liability 9 (6,066) (8,576) (8,518)
--------------------------------------------- ----- ------------------ ------------------ ---------
(363,148) (355,399) (351,084)
--------------------------------------------- ----- ------------------ ------------------ ---------
Total liabilities (416,566) (518,300) (497,272)
--------------------------------------------- ----- ------------------ ------------------ ---------
Net assets 573,658 552,596 567,425
--------------------------------------------- ----- ------------------ ------------------ ---------
Equity
Called-up share capital 23 1,465 1,459 1,459
Share premium account 103,462 101,304 101,304
Revaluation reserve 140,492 194,852 131,050
Capital redemption reserve 7,478 7,478 7,478
Other reserves 291 291 291
Retained earnings 320,470 247,212 325,843
--------------------------------------------- ----- ------------------ ------------------ ---------
Total equity 573,658 552,596 567,425
--------------------------------------------- ----- ------------------ ------------------ ---------
Unaudited Consolidated Cash Flow Statement
For the Half Year to 30 September 2019
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash flows from operating activities
Profit before tax 13,131 29,148 43,456
Adjustment for:
Depreciation 409 151 296
Revaluation surplus on Investment properties (9,442) (31,435) (44,284)
Loss/(gain) on sale of Investment properties 28 (1,102) (15,008)
Profit on sale of plant and equipment (11) (35) (52)
Net financing costs 7,004 6,583 16,424
Change in value of derivative financial instruments 4,980 (325) 3,322
Change in fair value of Convertible Bond (468) (958) (865)
Share based payment charge 920 898 2,274
Share of results of joint ventures (7,982) 3,874 3,217
Change in fair value of available-for-sale investment - (144) (144)
Foreign exchange movement 55 (47) (52)
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash inflows from operations before changes in working capital 8,624 6,608 8,584
Change in trade and other receivables 16,394 (6,463) 40,561
Change in land, developments and trading properties 1,276 1,994 3,731
Change in trade and other payables 3,231 2,660 (3,176)
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash inflows generated from operations 29,525 4,799 49,700
--------------------------------------------------------------- ------------------ ------------------ ---------
Finance costs (12,525) (13,525) (25,358)
Finance income 6,680 87 461
Tax paid (3,482) - (2,200)
--------------------------------------------------------------- ------------------ ------------------ ---------
(9,327) (13,438) (27,097)
--------------------------------------------------------------- ------------------ ------------------ ---------
Net cash generated from/(used by) operating activities 20,198 (8,639) 22,603
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash flows from investing activities
Additions to Investment property (32,423) (58,959) (79,742)
Net (costs)/proceeds from sale of Investment property (28) 29,036 164,058
Investments in joint ventures and subsidiaries (46,748) - -
Proceeds from disposal of joint ventures 1,334 - -
Dividends from joint ventures - 416 416
Receipts from available-for-sale investments - 144 144
Sale of plant and equipment 26 41 155
Purchase of leasehold improvements, plant and equipment (7) (114) (320)
--------------------------------------------------------------- ------------------ ------------------ ---------
Net cash (used by)/generated from investing activities (77,846) (29,436) 84,711
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash flows from financing activities
Borrowings drawn down 213,747 25,132 64,089
Borrowings repaid (296,679) (7,540) (54,306)
Finance lease repayments (290) - -
Shares issued 6 8 8
Equity dividends paid (8,980) (8,303) (11,406)
--------------------------------------------------------------- ------------------ ------------------ ---------
Net cash (used by)/generated from financing activities (92,196) 9,297 (1,615)
--------------------------------------------------------------- ------------------ ------------------ ---------
Net (decrease)/increase in cash and cash equivalents (149,844) (28,778) 105,699
Cash and cash equivalents at start of period 197,570 91,871 91,871
--------------------------------------------------------------- ------------------ ------------------ ---------
Cash and cash equivalents at end of period 47,726 63,093 197,570
--------------------------------------------------------------- ------------------ ------------------ ---------
Unaudited Consolidated Statement of Changes in Equity
At 30 September 2019
Capital
Share Share Revaluation redemption Other
capital premium reserve reserve reserves Retained earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------------- -------- -------- ----------- ----------- --------- ----------------- --------
At 31 March 2018 1,451 98,798 162,753 7,478 291 263,123 533,894
Total comprehensive income - - - - - 42,569 42,569
Revaluation surplus - - 44,284 - - (44,284) -
Realised on disposals - - (75,987) - - 75,987 -
Issued share capital 8 2,506 - - - - 2,514
Performance Share Plan - - - - - 2,274 2,274
Performance Share Plan -
deferred tax - - - - - 94 94
Share settled Performance Share
Plan - - - - - (1,837) (1,837)
Share settled bonus - - - - - (677) (677)
Dividends paid - - - - - (11,406) (11,406) At 31 March 2019 1,459 101,304 131,050 7,478 291 325,843 567,425 Balances at 1 April 2019, as previously reported 1,459 101,304 131,050 7,478 291 325,843 567,425 Impact of transition to IFRS 16 - - - - - (548) (548) Adjusted balances at 1 April 2019 1,459 101,304 131,050 7,478 291 325,295 566,877 Total comprehensive income - - - - 14,084 14,084 Revaluation surplus - - 9,442 - - (9,442) - Issued share capital 6 2,158 - - - - 2,164 Performance Share Plan - - - - - 920 920 Performance Share Plan - deferred tax - - - - - 355 355 Share settled Performance Share Plan - - - - - (1,349) (1,349) Share settled bonus - - - - - (413) (413) Dividends paid - - - - - (8,980) (8,980) At 30 September 2019 1,465 103,462 140,492 7,478 291 320,470 573,658 -------------------------------- -------- -------- ----------- ----------- --------- ----------------- --------
For a breakdown of total comprehensive income see the Unaudited Consolidated Statement of Comprehensive Income.
The credit adjustment to retained earnings of GBP920,000 (31 March 2019: GBP2,274,000) is the contra to the share based payments charge recognised in the Unaudited Consolidated Income Statement, in accordance with IFRS 2 'Share Based Payments'.
There were net transactions with owners of GBP7,303,000 (31 March 2019: GBP9,038,000) made up of the Performance Share Plan credit of GBP920,000 (31 March 2019: GBP2,274,000) and related deferred tax credit of GBP355,000 (31 March 2019: GBP94,000), dividends paid of GBP8,980,000 (31 March 2019: GBP11,406,000), the issue of share capital of GBP6,000 (31 March 2019: GBP8,000) and corresponding share premium of GBP2,158,000 (31 March 2019: GBP2,506,000), share settled Performance Share Plan awards charge of GBP1,349,000 (31 March 2019: GBP1,837,000) and the share settled bonus awards charge of GBP413,000 (31 March 2019: GBP677,000).
Capital
Share Share Revaluation redemption Other Retained
capital premium reserve reserve reserves earnings Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------- -------- -------- ----------- ----------- --------- --------- -------
At 31 March 2018 1,451 98,798 162,753 7,478 291 263,123 533,894
Total comprehensive income - - - - - 25,877 25,877
Revaluation surplus - - 31,435 - - (31,435) -
Realised on disposals - - 664 - - (664) -
Issued share capital 8 2,506 - - - - 2,514
Performance Share Plan - - - - - 898 898
Performance Share Plan
- deferred tax - - - - - 230 230
Share settled Performance
Share Plan - - - - - (1,837) (1,837)
Share settled bonus - - - - - (677) (677)
Dividends paid - - - - - (8,303) (8,303)
--------------------------- -------- -------- ----------- ----------- --------- --------- -------
At 30 September 2018 1,459 101,304 194,852 7,478 291 247,212 552,596
--------------------------- -------- -------- ----------- ----------- --------- --------- -------
The credit adjustment to retained earnings of GBP898,000 is the contra to the share based payments charge recognised in the Unaudited Consolidated Income Statement, in accordance with IFRS 2 'Share Based Payments'.
There were net transactions with owners of GBP7,175,000 made up of the Performance Share Plan credit of GBP898,000 and related deferred tax credit of GBP230,000, share settled Performance Share Plan charge of GBP1,837,000, share settled bonus charge of GBP677,000, dividends paid of GBP8,303,000, the issue of share capital of GBP8,000 and corresponding share premium of GBP2,506,000.
Unaudited Notes to the Half Year Results
1. Financial Information
The financial information contained in this statement does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. The full accounts for the year ended 31 March 2019, which were prepared under International Financial Reporting Standards as adopted by the European Union and which received an unqualified report from the Auditors, and did not contain a statement under Section 498(2) or Section 498(3) of the Companies Act 2006, have been filed with the Registrar of Companies.
These interim condensed unaudited consolidated financial statements do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 March 2019.
These interim condensed unaudited consolidated financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union. The same accounting policies and methods of computation are followed in the 30 September 2019 interim condensed unaudited consolidated financial statements as in the most recent annual financial statements.
New Standards Adopted During the Period
During the six months to 30 September 2019, the following accounting standards and interpretations have been adopted by the Group:
Adoption of IFRS 16 'Leases'
The Group has adopted IFRS 16 'Leases', effective from 1 April 2019. This standard introduces significant changes for lessees by removing the distinction between operating and finance leases, requiring the recognition of a 'Right of Use Asset' and a 'Lease Liability' on the Balance Sheet. This applies to the Group and Company's lease of its head office premises, which was previously an operating lease under IAS 17 'Leases', and the headlease payments due under the long leasehold Investment properties. The accounting for rental income earned by the Group as a lessor remains unchanged.
Revised accounting policy
The Group assesses whether a contract contains a lease on entering into the contract. IFRS 16 expressly excludes short leases (under 12 months) and leases of low value. Where the Group has these leases, lease payments are recognised as operating expenses on a straight-line basis over the lease term.
IFRS 16 requires that a Lease Liability and corresponding Right of Use Asset are recognised on the Balance Sheet.
The Lease Liability is initially measured at the present value of future lease payments discounted at the rate implicit in the lease or, if this is not readily available, the Group's incremental borrowing rate. The Lease Liability is subsequently increased by the interest charge and decreased by lease payments made. The Lease Liability is adjusted for changes in the lease term or payments and contract modifications as they arise.
The Right of Use Asset initially comprises the corresponding Lease Liability, lease payments made at or before the commencement date and any direct costs. Where the Group has an obligation to restore the premises at the end of the lease term, a provision is made under IAS 37 'Provisions, Contingent Liabilities and Contingent Assets'. The costs are added to the Right of Use Asset. It is subsequently measured at cost less accumulated depreciation and impairment losses.
Approach to transition
The Group has applied IFRS 16 using the modified retrospective approach and therefore the results for the year to 31 March 2019 have not been restated. The Lease Liability is calculated at transition using the incremental borrowing rate at that date of 3.79%, being the weighted average cost of general debt at 31 March 2019. The Right of Use Asset is measured applying IFRS 16.C8(b)(i) where the Standard is assumed to apply from the commencement of the lease but discounted at the incremental borrowing rate at 31 March 2019. The resulting cumulative charge to 31 March 2019 is recognised as an adjustment to retained earnings on transition of GBP548,000. No practical expedients have been applied on transition.
Additional changes from previous lessee accounting
In addition to the new requirement for leases previously considered operating leases to be reflected as a Right of Use Asset and a Lease Liability on the Balance Sheet, the following changes apply:
- lease incentives are to be recognised as part of the initial measurement on the Balance Sheet where they were previously a lease incentive liability, amortised on a straight-line basis;
- Right of Use Assets are to be tested for impairment under IAS 36 'Impairment of Assets', replacing the onerous lease provisions under IAS 17;
- the rental expense in Administrative Expenses is replaced by depreciation of the Right of Use Asset and interest on the Lease Liability; and
- the cash payments are to be recognised within financing activities (principal payment) and interest paid (interest payment) in the Consolidated and Company Cash Flow Statements, where all lease payments were previously shown as operating cash outflows.
The following table sets out the adjustments made on transition to IFRS 16:
Under IAS 17 Under IFRS 16
31 March Impact of 1 April
2019 IFRS 16 2019
GBP000 GBP000 GBP000
--------------------------------------------- ------------ --------- -------------
Non-current assets
Owner occupied property, plant and equipment - 5,064 5,064
Current assets
Trade and other receivables 189 (189) -
--------------------------------------------- ------------ --------- -------------
Total assets 189 4,875 5,064
Current liabilities
Trade and other payables (1,150) 1,150 -
Non-current liabilities
Lease liability - (6,573) (6,573)
--------------------------------------------- ------------ --------- -------------
Total liabilities (1,150) (5,423) (6,573)
Retained earnings 325,843 (548) 325,295
--------------------------------------------- ------------ --------- -------------
Net assets 567,425 (548) 566,877
--------------------------------------------- ------------ --------- -------------
The difference between the operating lease commitments of GBP7,773,000 disclosed at 31 March 2019 and the Lease Liability of GBP6,573,000 at 1 April 2019 is due to discounting.
Going Concern
The Directors have assessed the going concern of the Group for a period of five years to March 2024, being the period for which the Board regularly reviews forecasts and which encompasses the lifetime of the Group's major development projects.
In making its assessment, the Board considers the principal risks and then assesses the potential impacts in severe, but plausible, downside scenarios together with the likely effectiveness of mitigating actions that the Group would have at its disposal.
Based on their assessment the Directors have a reasonable expectation that the Group will continue in operational existence for the foreseeable future and have, therefore, used the going concern basis in preparing the condensed unaudited financial statements.
Principal Risks and Uncertainties
The responsibility for the governance of the Group's risk profile lies with the Board of Directors of Helical. The Board is responsible for setting the Group's risk strategy by assessing risks, determining its willingness to accept those risks and ensuring that the risks are monitored and that the Group is aware of and, if appropriate, reacts to changes in those risks. The Board is also responsible for allocating responsibility for risk within the Group's management structure.
The Group considers its principal risks to be:
Strategic Risks - external risks that could prevent the Group delivering its strategy. These risks principally impact our decision to purchase or exit from a property asset.
Financial Risks - risks that could prevent the Group from funding its chosen strategy, both in the long and short term.
Operational Risks - internal risks that could prevent the Group from delivering its strategy.
Reputational Risk - risks that could affect the Group in all aspects of its strategy.
There have been no significant changes to these risk areas in the period nor are there expected to be for the half year to 31 March 2020. A further analysis of these risks is included within the consolidated financial statements of the Group for the year ended 31 March 2019.
Critical Accounting Judgements
In addition to those noted in the 31 March 2019 Annual Report the Group made the following judgement:
Accounting treatment for 33 Charterhouse Street, London EC1.
During the period the Group acquired, in joint venture, a Development Agreement which contains the right to develop the 33 Charterhouse Street, London EC1 office building. In return, and once practical completion has been achieved, it will receive the long leasehold interest in the site. The Group has determined that the Development Agreement represents an agreement for lease and it should be accounted for as an Investment property at fair value, under IAS 40 'Investment Property', as the intention is to complete the development of the office and hold it for rental income and capital appreciation.
Key Sources of Estimation
There were no new estimates in addition to those noted in the 31 March 2019 Annual Report.
2. Revenue from Contracts with Customers
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
-------------------------------------------- ------------------ ------------------ ---------
Development property income 3,080 5,545 7,963
Service charge income 4,422 4,319 8,058
Other revenue 47 4 -
-------------------------------------------- ------------------ ------------------ ---------
Total revenue from contracts with customers 7,549 9,868 16,021
-------------------------------------------- ------------------ ------------------ ---------
The total revenue from contracts with customers is the revenue recognised in accordance with IFRS 15 'Revenue from Contracts with Customers'. This reflects the Development property income and Other revenue in Note 3.
No impairment of contract assets was recognised in the half year to 30 September 2019 (half year to 30 September 2018: GBPnil: year to 31 March 2019: GBPnil).
3. Segmental Information
The Group identifies two discrete operating segments whose results are regularly reviewed by the Chief Operating Decision Maker (the Chief Executive) to allocate resources to these segments and to assess their performance. The segments are:
-- Investment properties, which are owned or leased by the Group for long-term income and for capital appreciation; and
-- Development properties, which include sites, developments in the course of construction, completed developments available for sale, and pre-sold developments.
Investments Developments Total Investments Developments Total
Half Year to Half Year to Half Year to Half Year to Half Year to Half Year to
30.09.19 30.09.19 30.09.19 30.09.18 30.09.18 30.09.18
Revenue GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------ ------------------ ------------- ------------- ------------------ ------------- -------------
Rental income 14,506 - 14,506 13,527 - 13,527
Service charge
income 4,422 - 4,422 4,319 - 4,319
Development
property income - 3,080 3,080 - 5,545 5,545
Other revenue 47 - 47 4 - 4
------------------ ------------------ ------------- ------------- ------------------ ------------- -------------
Revenue 18,975 3,080 22,055 17,850 5,545 23,395
------------------ ------------------ ------------- ------------- ------------------ ------------- -------------
Developments Total
Investments Year to Year to Year to
31.03.19 31.03.19 31.03.19
Revenue GBP000 GBP000 GBP000
---------------------------- ------------------- ------------ ---------
Rental income 28,154 - 28,154
Development property income - 7,963 7,963
Service charge income 8,058 - 8,058
---------------------------- ------------------- ------------ ---------
Revenue 36,212 7,963 44,175
---------------------------- ------------------- ------------ ---------
Developments Total Investments Developments Total
Investments Half Year to Half Year to Half Year to Half Year to Half Year to
Half Year to 30.09.19 30.09.19 30.09.19 30.09.18 30.09.18 30.09.18
Profit before tax GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------- --------------------- ------------- ------------- -------------- ------------- -------------
Net rental income 12,811 - 12,811 11,769 (22) 11,747
Development
property gain - 1,441 1,441 - 1,686 1,686
Share of results of
joint ventures 6,514 1,468 7,982 1,252 (5,126) (3,874)
Gain on sale and
revaluation of
Investment
properties 9,414 - 9,414 32,537 - 32,537
------------------- --------------------- ------------- ------------- -------------- ------------- -------------
28,739 2,909 31,648 45,558 (3,462) 42,096
Fair value movement of
available-for-sale
investments - 144
Other operating
income 44 4
------------------- --------------------- ------------- ------------- -------------- ------------- -------------
Gross profit 31,692 42,244
Administrative
expenses (7,054) (7,861)
Net finance costs (7,004) (6,583)
Change in fair value of
derivative financial
instruments (4,980) 325
Change in fair value of
Convertible Bond 468 958
Foreign exchange
gain 9 65
------------------- --------------------- ------------- ------------- -------------- ------------- -------------
Profit before tax 13,131 29,148
------------------- --------------------- ------------- ------------- -------------- ------------- -------------
Investments Developments Total
Year to Year to Year to
31.03.19 31.03.19 31.03.19
Profit before tax GBP000 GBP000 GBP000
--------------------------------------------------------- ----------- ------------ ---------
Net rental income 24,599 - 24,599
Development property loss - (1,781) (1,781)
Share of results of joint ventures 5,203 (8,420) (3,217)
Gain on sale and revaluation of Investment properties 59,292 - 59,292
--------------------------------------------------------- ----------- ------------ ---------
89,094 (10,201) 78,893
Fair value movement of available-for-sale investments 144
--------------------------------------------------------- ----------- ------------ ---------
Gross profit 79,037
Administrative expenses (16,753)
Net finance costs (16,424)
Change in fair value of derivative financial instruments (3,322)
Change in fair value of Convertible Bond 865
Foreign exchange gain 53
--------------------------------------------------------- ----------- ------------ ---------
Profit before tax 43,456
--------------------------------------------------------- ----------- ------------ ---------
Investments Developments Total Investments Developments Total
At 30.09.19 At 30.09.19 At 30.09.19 At 30.09.18 At 30.09.18 At 30.09.18
Net assets GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------------- -------------- ------------ ------------ ------------ ------------ ------------
Investment properties 820,138 - 820,138 744,850 - 744,850
Land, development and trading
properties - 1,035 1,035 - 4,048 4,048
Investment in joint ventures 31,739 46,334 78,073 13,604 17,915 31,519
------------------------------------ ---------- ------------ ------------ ------------ ------------ ------------
851,877 47,369 899,246 758,454 21,963 780,417
Other assets 90,978 290,479
-------------------------------- -------------- ------------ ------------ ------------ ------------ ------------
Total assets 990,224 1,070,896
Liabilities (416,566) (518,300)
-------------------------------- -------------- ------------ ------------ ------------ ------------ ------------
Net assets 573,658 552,596
-------------------------------- -------------- ------------ ------------ ------------ ------------ ------------
Investments Developments Total
At 31.03.19 At 31.03.19 At 31.03.19
Net assets GBP000 GBP000 GBP000
----------------------------------------- ------------- ------------ ------------
Investment properties 778,752 - 778,752
Land, development and trading properties - 2,311 2,311
Investment in joint ventures 17,556 7,120 24,676
----------------------------------------- ------------- ------------ ------------
796,308 9,431 805,739
Other assets 258,958
----------------------------------------- ------------- ------------ ------------
Total assets 1,064,697
Liabilities (497,272)
----------------------------------------- ------------- ------------ ------------
Net assets 567,425
----------------------------------------- ------------- ------------ ------------
4. Net Rental Income
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
-------------------------------------------------------- ------------------ ------------------ ---------
Gross rental income 14,506 13,527 28,154
Property overheads (1,695) (1,919) (3,695)
-------------------------------------------------------- ------------------ ------------------ ---------
12,811 11,608 24,459
Net rental expense attributable to profit share partner - 139 140
-------------------------------------------------------- ------------------ ------------------ ---------
Net rental income 12,811 11,747 24,599
-------------------------------------------------------- ------------------ ------------------ ---------
5. Development Property Profit/(Loss)
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------------------------- ------------------ ------------------ ---------
Development property income 3,080 5,545 7,963
Cost of sales (1,493) (1,980) (5,399)
Sales expenses (20) - -
Provision against book values (126) (1,879) (4,345)
----------------------------------- ------------------ ------------------ ---------
Development property profit/(loss) 1,441 1,686 (1,781)
----------------------------------- ------------------ ------------------ ---------
6. (Loss)/Gain on Sale of Investment Properties
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------------------------ ------------------ ------------------ ---------
Net (costs)/proceeds from the sale of Investment properties (28) 29,046 164,058
Book value (Note 12) - (26,469) (147,550)
Tenants' incentives on sold Investment properties - (1,475) (1,500)
------------------------------------------------------------ ------------------ ------------------ ---------
(Loss)/gain on sale of Investment properties (28) 1,102 15,008
------------------------------------------------------------ ------------------ ------------------ ---------
7. Administrative Expenses
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------------- ------------------ ------------------ ---------
Administration costs (5,324) (5,552) (10,858)
Performance related awards (1,366) (2,033) (5,202)
National Insurance on performance related awards (364) (276) (693)
------------------------------------------------- ------------------ ------------------ ---------
Administrative expenses (7,054) (7,861) (16,753)
------------------------------------------------- ------------------ ------------------ ---------
8. Finance Costs
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------------------------------------------- ------------------ ------------------ ---------
Interest payable on bank loans, bonds and overdrafts (6,756) (8,263) (16,414)
Other interest payable and similar charges (2,686) (1,618) (4,208)
Interest capitalised 1,127 2,265 3,215
----------------------------------------------------- ------------------ ------------------ ---------
Finance costs (8,315) (7,616) (17,407)
----------------------------------------------------- ------------------ ------------------ ---------
9. Tax on Profit on Ordinary Activities
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------------------------------- ------------------ ------------------ ---------
The tax charge is based on the profit for the period and represents:
United Kingdom corporation tax at 19%
- Group corporation tax (1,201) (11,201) (8,813)
- Adjustment in respect of prior periods - - 315
- Use of tax losses - - (509)
----------------------------------------- ------------------ ------------------ ---------
Current tax charge (1,201) (11,201) (9,007)
Deferred tax
- Capital allowances (576) 252 (1,003)
- Tax losses 147 (1,498) (677)
- Unrealised chargeable gains 2,029 10,250 10,647
- Other temporary differences 499 (1,027) (796)
----------------------------------------- ------------------ ------------------ ---------
Deferred tax credit 2,099 7,977 8,171
----------------------------------------- ------------------ ------------------ ---------
Total tax credit/(charge) for period 898 (3,224) (836)
----------------------------------------- ------------------ ------------------ ---------
At
At At 31 March
30 September 2019 30 September 2018 2019
Deferred tax GBP000 GBP000 GBP000
---------------------------- ------------------- ------------------ ---------
Capital allowances (3,839) (2,008) (3,263)
Tax losses 2,167 1,198 2,019
Unrealised chargeable gains (7,131) (9,556) (9,159)
Other temporary differences 2,737 1,790 1,885
---------------------------- ------------------- ------------------ ---------
Deferred tax liability (6,066) (8,576) (8,518)
---------------------------- ------------------- ------------------ ---------
Under IAS 12 'Income Taxes', deferred tax provisions are made for the tax that would potentially be payable on the realisation of Investment properties and other assets at book value.
If upon sale of the Investment properties the Group retained all the capital allowances, the deferred tax provision in respect of capital allowances of GBP3,839,000 (net) would be released and further capital allowances of GBP62,519,000 (gross) would be available to reduce future tax liabilities.
The net deferred tax asset in respect of other temporary differences arises from tax relief available to the Group on the mark-to-market valuation of financial instruments, the future vesting of share awards and other timing differences.
10. Dividends
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
-------------------------------------------------------- ------------------ ------------------ ---------
Attributable to equity share capital
Ordinary
- Interim paid 2.60p per share - - 3,103
- Prior period final paid 7.50p per share (2018: 7.00p) 8,980 8,303 8,303
-------------------------------------------------------- ------------------ ------------------ ---------
8,980 8,303 11,406
-------------------------------------------------------- ------------------ ------------------ ---------
The interim dividend of 2.70p (30 September 2018: 2.60p per share) was approved by the Board on 21 November 2019 and will be paid on 31 December 2019 to Shareholders on the register on 29 November 2019. This interim dividend, amounting to GBP3,239,000, has not been included as a liability as at 30 September 2019.
11. Earnings Per Share
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period. This is a different basis to the net asset per share calculations which are based on the number of shares at the period end.
The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of shares and the post tax effect of dividends on the assumed exercise of all dilutive options.
The earnings per share is calculated in accordance with IAS 33 'Earnings per Share' and the best practice recommendations of the European Public Real Estate Association ("EPRA").
Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below:
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
000s 000s 000s
----------------------------------------------------------------- ------------------- ------------------- ---------
Ordinary shares in issue 119,957 119,363 119,363
Weighting adjustment (237) (613) (307)
----------------------------------------------------------------- ------------------- ------------------- ---------
Weighted average ordinary shares in issue for calculation of
basic and EPRA earnings per share 119,720 118,750 119,056
Weighted average ordinary shares issued on share settled bonuses 636 735 862
Weighted average ordinary shares to be issued under Performance
Share Plan 868 326 778
----------------------------------------------------------------- ------------------- ------------------- ---------
Weighted average ordinary shares in issue for calculation of
diluted earnings per share 121,224 119,811 120,696
----------------------------------------------------------------- ------------------- ------------------- ---------
GBP000 GBP000 GBP000
----------------------------------------------------------------- ------------------- ------------------- ---------
Earnings used for calculation of basic and diluted earnings per
share 14,029 25,924 42,620
----------------------------------------------------------------- ------------------- ------------------- ---------
Basic earnings per share 11.7p 21.8p 35.8p
Diluted earnings per share 11.6p 21.6p 35.3p
----------------------------------------------------------------- ------------------- ------------------- ---------
GBP000 GBP000 GBP000
------------------------------------------------------------------------------------------------------------ ------- -------- --------
Earnings used for calculation of basic and diluted earnings per share 14,029 25,924 42,620
Net gain on sale and revaluation of Investment properties
-
subsidiaries (9,414) (32,537) (59,292)
- joint
ventures (472) (1,081) (1,288)
Tax on profit on disposal of Investment property held for sale - 13,641 -
Tax on profit on disposal of Investment properties - 270 14,130
Tax on gain on settlement of derivative component of Convertible Bond 1,556 - -
Gain on movement in share of joint ventures (2,404) - -
Fair value movement on derivative financial instruments - subsidiaries 4,980 (325) 3,322
- joint
ventures 34 22 35
Fair value movement on Convertible Bond (468) (958) (865)
Profit on cancellation of derivative financial instruments (218) (72) (72)
Expense on cancellation of loans 1,131 - 1,458
Fair value movement of available-for-sale investments - (144) (144)
Deferred tax on adjusting items (2,270) (10,202) (9,935)
------------------------------------------------------------------------------------------------------------ ------- -------- --------
Earnings/(loss) used for calculations of EPRA earnings per share 6,484 (5,462) (10,031)
------------------------------------------------------------------------------------------------------------ ------- -------- --------
EPRA earnings/(loss) per share 5.4p (4.6)p (8.4)p
------------------------------------------------------------------------------------------------------------ ------- -------- --------
The earnings used for the calculation of EPRA earnings per share includes net rental income and development property profits but excludes investment and trading property gains.
12. Investment Properties
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
---------------------------------------------------------- ------------------ ------------------ ---------
Book value at 1 April 778,752 791,948 791,948
Additions at cost 31,944 72,040 90,320
Disposals - (26,469) (147,550)
Transfer of Investment property held for sale - (125,200) -
Revaluation surplus 9,442 32,781* 44,284
Revaluation deficit attributable to profit share partners - (250) (250)
---------------------------------------------------------- ------------------ ------------------ ---------
As at period end 820,138 744,850 778,752
---------------------------------------------------------- ------------------ ------------------ ---------
* Revaluation surplus is presented net of the transaction expenditure on The Shepherds Building, London, W14 of GBP1,346,000 which had been accrued for the period to 30 September 2018.
All properties are stated at market value as at 30 September 2019, and are valued by professionally qualified external valuers (Cushman & Wakefield LLP) in accordance with the Valuation - Professional Standards published by the Royal Institution of Chartered Surveyors. The fair value of the Investment properties at 30 September 2019 is as follows:
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------------------------------- ------------------ ------------------ ---------
Book value 820,138 744,850 778,752
Lease incentives and costs included in trade and other receivables 17,130 11,589 14,687
Head leases capitalised (2,168) (2,189) (2,189)
------------------------------------------------------------------- ------------------ ------------------ --------- Fair value 835,100 754,250 791,250 ------------------------------------------------------------------- ------------------ ------------------ ---------
Interest capitalised in respect of the refurbishment of Investment properties at 30 September 2019 amounted to GBP12,484,000 (30 September 2018: GBP11,322,000; 31 March 2019: GBP11,357,000). Interest capitalised during the period in respect of the refurbishment of Investment properties amounted to GBP1,127,000 (30 September 2019: GBP2,265,000, 31 March 2019: GBP3,215,000).
The historical cost of Investment property is GBP676,356,000 (30 September 2018: GBP635,488,000; 31 March 2019: GBP645,521,000).
13. Joint Ventures
Year to
Half Year to Half Year to 31 March
30 September 2019 30 September 2018 2019
Share of results of joint ventures GBP000 GBP000 GBP000
----------------------------------------------------------- ------------------- ------------------ ---------
Revenue 6,746 37,848 52,402
----------------------------------------------------------- ------------------- ------------------ ---------
Gross rental income 392 426 971
Property overheads (162) (466) (411)
----------------------------------------------------------- ------------------- ------------------ ---------
Net rental income/(expense) 230 (40) 560
Gain on revaluation of Investment properties 472 1,081 1,288
Development profit 5,355 500 4,570
Provision against book values (1,083) (4,288) (7,198)
Other operating income - 31 9
----------------------------------------------------------- ------------------- ------------------ ---------
Gross profit/(loss) 4,974 (2,716) (771)
Administrative expenses (335) (161) (406)
----------------------------------------------------------- ------------------- ------------------ ---------
Operating profit/(loss) 4,639 (2,877) (1,177)
Finance costs (595) (807) (2,087)
Finance income 41 32 92
Change in fair value of derivative financial instruments (34) (22) (35)
----------------------------------------------------------- ------------------- ------------------ ---------
Profit/(loss) before tax 4,051 (3,674) (3,207)
Tax (31) (967) (1,399)
----------------------------------------------------------- ------------------- ------------------ ---------
Profit/(loss) after tax 4,020 (4,641) (4,606)
Reversal of One Creechurch Place loss(1) 224 767 1,389
Profit on sale of interest in One Creechurch Place 1,334 - -
Uplift for Barts Square economic interest(2) 2,404 - -
----------------------------------------------------------- ------------------- ------------------ ---------
Share of results of joint ventures 7,982 (3,874) (3,217)
----------------------------------------------------------- ------------------- ------------------ ---------
At
At At 31 March
30 September 2019 30 September 2018 2019
Investment in joint ventures GBP000 GBP000 GBP000
----------------------------------------------------------- ------------------- ------------------ ---------
Summarised balance sheets
Non-current assets
Investment properties 65,572 24,427 25,289
Owner occupied property, plant and equipment 111 26 106
Deferred tax 1,687 2,110 23
Derivative financial instruments 6 37 1,774
----------------------------------------------------------- ------------------- ------------------ ---------
67,376 26,600 27,192
----------------------------------------------------------- ------------------- ------------------ ---------
Current assets
Land, development and trading properties 53,188 53,466 56,935
Trade and other receivables 14,605 12,626 10,554
Cash and cash equivalents 3,551 17,629 7,612
----------------------------------------------------------- ------------------- ------------------ ---------
71,344 83,721 75,101
----------------------------------------------------------- ------------------- ------------------ ---------
Current liabilities
Trade and other payables (12,376) (18,559) (13,599)
----------------------------------------------------------- ------------------- ------------------ ---------
(12,376) (18,559) (13,599)
----------------------------------------------------------- ------------------- ------------------ ---------
Non-current liabilities
Trade and other payables (323) (17,814) (20,419)
Borrowings (48,026) (46,680) (48,473)
(48,349) (64,494) (68,892)
----------------------------------------------------------- ------------------- ------------------ ---------
Net assets pre-adjustment 77,995 27,268 19,802
Reversal of One Creechurch Place net liability position(1) - 4,251 4,874
Acquisition costs 78 - -
----------------------------------------------------------- ------------------- ------------------ ---------
Investment in joint ventures 78,073 31,519 24,676
----------------------------------------------------------- ------------------- ------------------ ---------
(1) This is an adjustment that has been made to add back the Group's share of the loss incurred in one of its joint ventures arising from finance and other costs in the period to ensure that the Group's interest is shown at its recoverable amount.
(2) This is an adjustment to reflect the impact of the consolidation of a joint venture at its economic interest of 43.8% rather than its actual ownership interest of 33.3%, following additional equity invested during the period.
The Directors' valuation of trading and development stock shows a surplus of GBPnil (30 September 2018: GBP800,000; 31 March 2019: GBPnil) above book value. This surplus has been included in the EPRA net asset value (Note 24).
14. Land, Developments and Trading Properties
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
--------------------------------- ------------------ ------------------ ---------
Development properties 1,007 4,020 2,283
Properties held as trading stock 28 28 28
--------------------------------- ------------------ ------------------ ---------
1,035 4,048 2,311
--------------------------------- ------------------ ------------------ ---------
The Directors' valuation of trading and development stock shows a surplus of GBP578,000 (30 September 2018: GBP628,000; 31 March 2019: GBP578,000) above book value. This surplus has been included in the EPRA net asset value (Note 24).
No interest has been capitalised or included in land, developments and trading properties.
15. Investment Property Held for Sale
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------- ------------------ ------------------ ---------
Transferred from Investment property - 123,734 -
Outstanding lease incentives - 1,466 -
------------------------------------- ------------------ ------------------ ---------
- 125,200 -
------------------------------------- ------------------ ------------------ ---------
In the prior period, the Group unconditionally exchanged contracts on the sale of The Shepherds Building, London W14, for GBP125.2m. Completion took place after the prior period end on 5 October 2018 and the property was classified as a held for sale asset under IFRS 5 'Non-current Assets Held for Sale and Discontinued Operations'.
16. Available-For-Sale Investments
The gain of GBP144,000 recognised in the prior period is the result of cash received in relation to a previously fully impaired asset.
17. Trade and Other Receivables
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------ ------------------ ------------------ ---------
Trade receivables 10,588 38,059 9,680
Other receivables 1,656 20,899 22,856
Prepayments 4,210 4,502 4,173
Accrued income 20,085 35,240 22,017
------------------ ------------------ ------------------ ---------
36,539 98,700 58,726
------------------ ------------------ ------------------ ---------
18. Cash and Cash Equivalents
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------------------- ------------------ ------------------ ---------
Cash held at managing agents 4,900 4,118 2,599
Restricted cash 8,330 1,572 2,678
Cash deposits 34,496 57,403 192,293
----------------------------- ------------------ ------------------ ---------
47,726 63,093 197,570
----------------------------- ------------------ ------------------ ---------
Restricted cash is made up of cash held by solicitors and cash in restricted accounts.
19. Trade and Other Payables
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------- ------------------ ------------------ ---------
Trade payables 20,200 15,000 13,009
Other payables 1,559 8,731 1,869
Accruals 24,355 25,044 23,368
Deferred income 6,425 6,877 4,913
------------------------------------- ------------------ ------------------ ---------
Current trade and other payables 52,539 55,652 43,159
Accruals 590 10,815 11,405
------------------------------------- ------------------ ------------------ ---------
Non-current trade and other payables 590 10,815 11,405
------------------------------------- ------------------ ------------------ ---------
Total trade and other payables 53,129 66,467 54,564
------------------------------------- ------------------ ------------------ ---------
20. Lease Liability
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
---------------------------- ------------------ ------------------ ---------
Current lease liability 599 - -
---------------------------- ------------------ ------------------ ---------
Non-current lease liability 7,872 2,189 2,189
---------------------------- ------------------ ------------------ ---------
Included within the lease liability are GBP599,000 (30 September 2019: GBPnil, 31 March 2019: GBPnil) of current and GBP5,683,000 (30 September 2019: GBPnil, 31 March 2019: GBPnil) of non-current lease liabilities which relate to the adoption of IFRS 16 'Leases'.
21. Borrowings
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------------------- ------------------ ------------------ ---------
Current borrowings - 100,375 100,468
----------------------------- ------------------ ------------------ ---------
Borrowings repayable within:
- one to two years - 184,686 -
- two to three years - - 195,410
- three to four years 31,930 - -
- four to five years 216,591 24,887 37,399
- five to six years 92,082 - 92,005
- six to ten years - 122,717 -
----------------------------- ------------------ ------------------ ---------
Non-current borrowings 340,603 332,290 324,814
----------------------------- ------------------ ------------------ ---------
Total borrowings 340,603 432,665 425,282
----------------------------- ------------------ ------------------ ---------
The GBP100,000,000 Convertible Bond was repaid in June 2019.
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------------- ------------------ ------------------ ---------
Total borrowings 340,603 432,665 425,282
Cash (47,726) (63,093) (197,570)
----------------- ------------------ ------------------ ---------
Net borrowings 292,877 369,572 227,712
----------------- ------------------ ------------------ ---------
Net borrowings excludes the Group's share of borrowings in joint ventures of GBP48,026,000 (30 September 2018: GBP46,680,000; 31 March 2019: GBP48,473,000) and cash of GBP3,551,000 (30 September 2018: GBP17,629,000; 31 March 2019: GBP7,612,000). All borrowings in joint ventures are secured.
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------- ------------------ ------------------ ---------
Net assets 573,658 552,596 567,425
----------- ------------------ ------------------ ---------
Gearing 51% 67% 40%
----------- ------------------ ------------------ ---------
22. Derivative Financial Instruments
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------- ------------------ ------------------ ---------
Derivative financial instruments asset 319 1,703 915
------------------------------------------- ------------------ ------------------ ---------
Derivative financial instruments liability (8,017) (1,529) (4,158)
------------------------------------------- ------------------ ------------------ ---------
A loss on the change in fair value of GBP4,980,000 has been recognised in the Unaudited Consolidated Income Statement (30 September 2018: gain of GBP325,000, 31 March 2019: loss of GBP3,322,000).
The fair values of the Group's outstanding interest rate swaps and caps have been estimated by calculating the present values of future cash flows, using appropriate market discount rates, representing Level 2 fair value measurements as defined in IFRS 13 'Fair Value Measurement'.
23. Share Capital
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
----------- ------------------ ------------------ ---------
Authorised 39,577 39,577 39,577
----------- ------------------ ------------------ ---------
The authorised share capital of the Company is GBP39,576,626.60 divided into ordinary shares of 1p each and deferred shares of 1/8p each.
Allotted, called up and fully paid:
- 119,956,767 (30 September 2018: 119,363,349; 31 March 2019: 119,363,349) ordinary shares
of 1p each 1,200 1,194 1,194
- 212,145,300 deferred shares of 1/8p each 265 265 265
------------------------------------------------------------------------------------------- ----- ----- -----
1,465 1,459 1,459
------------------------------------------------------------------------------------------- ----- ----- -----
24. Net Assets Per Share
Number
At of At
30 September 2019 shares 30 September 2019
GBP000 000s Pence per share
------------------------------------------------------------------ ------------------ ------- ------------------
Net asset value 573,658
Less - deferred shares (265)
------------------------------------------------------------------ ------------------ ------- ------------------
Basic net asset value 573,393 119,957 478
Add - share settled bonus 636
Add - dilutive effect of the Performance Share Plan 926
------------------------------------------------------------------ ------------------ ------- ------------------
Diluted net asset value 573,393 121,519 472
Adjustment for:
- fair value of financial instruments 7,689
- deferred tax 9,309
------------------------------------------------------------------ ------------------ ------- ------------------
Adjusted diluted net asset value 590,391 121,519 486
Adjustment for:
- fair value of trading and development properties 578
------------------------------------------------------------------ ------------------ ------- ------------------
EPRA net asset value 590,969 121,519 486
Adjustment for:
- fair value of fixed rate loans (7,282)
- fair value of financial instruments (7,689)
- deferred tax (9,309)
------------------------------------------------------------------ ------------------ ------- ------------------
EPRA triple net asset value 566,689 121,519 466
------------------------------------------------------------------ ------------------ ------- ------------------
The adjustment for the fair value of trading and development properties represents the surplus as at 30 September 2019.
At Number At
31 March of 31 March
2019 shares 2019
GBP000 000s Pence per share
------------------------------------------------------------------ --------- ------- ----------------
Net asset value 567,425 119,363
Less - deferred shares (265)
------------------------------------------------------------------ --------- ------- ----------------
Basic net asset value 567,160 119,363 475
Add - share settled bonus 862
Add - dilutive effect of the Performance Share Plan 734
------------------------------------------------------------------ --------- ------- ----------------
Diluted net asset value 567,160 120,959 469
Adjustment for:
- fair value of financial instruments 3,218
- fair value surplus on Convertible Bond 468
- deferred tax 11,687
------------------------------------------------------------------ --------- ------- ----------------
Adjusted diluted net asset value 582,533 120,959 482
Adjustment for:
- fair value of trading and development properties 578
------------------------------------------------------------------ --------- ------- ----------------
EPRA net asset value 583,111 120,959 482
Adjustment for:
- fair value of fixed rate loans (5,449)
- fair value of financial instruments (3,218)
- deferred tax (11,687)
------------------------------------------------------------------ --------- ------- ----------------
EPRA triple net asset value 562,757 120,959 465
------------------------------------------------------------------ --------- ------- ----------------
The net asset values per share have been calculated in accordance with guidance issued by the European Public Real Estate Association ("EPRA").
The adjustments to the net asset value comprise the amounts relating to the Group and its share of joint ventures.
25. Related Party Transactions
The following amounts were due from/(to) the Group's joint ventures:
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------- ------------------ ------------------ ---------
ARE 1 Farringdon SARL 370 - -
Charterhouse Place Ltd 9 - -
Barts Square companies 31 2,543 34
Creechurch Place Ltd - 37,890 22,073
King Street Developments (Hammersmith) Ltd 71 309 71
Old Street Holdings LP 3 3 3
Shirley Advance LLP 14 249 330
------------------------------------------- ------------------ ------------------ ---------
During the period, interest on bonds of GBP745,000 (30 September 2018: GBP875,000; 31 March 2019: GBP451,000) and a promote fee for development management services of GBP305,000 (30 September 2018: GBP4,874,000; 31 March 2019: GBP7,142,000) were charged by the Group to Creechurch Place Limited. A development management, accounting and corporate services fee of GBP945,000 (30 September 2018: GBP670,000; 31 March 2019: GBP821,000) was charged by the Group to the Barts Square companies. In addition, an accounting and corporate services fee of GBP9,000 (30 September 2018: GBPnil, 31 March 2019: GBPnil) was charged by the Group to each of ARE 1 Farringdon SARL and Charterhouse Place Ltd.
26. See-through Analysis
Helical holds a significant proportion of its property assets in joint ventures with partners that provide a significant equity contribution, whilst relying on the Group to provide asset management or development expertise. Accounting convention requires Helical to account under IFRS for its share of the net results and net assets of joint ventures in limited detail in the Income Statement and Balance Sheet. Net asset value per share, a key performance measure used in the real estate industry, as reported in the financial statements under IFRS, does not provide shareholders with the most relevant information on the fair value of assets and liabilities within an ongoing real estate company with a long term investment strategy.
This analysis incorporates the separate components of the results of the consolidated subsidiaries and Helical's share of its joint ventures' results into a 'see-through' analysis of its property portfolio, debt profile and the associated income streams and financing costs, to assist in providing a comprehensive overview of the Group's activities.
See-through Net Rental Income
Helical's share of the gross rental income, head rents payable and property overheads from property assets held in subsidiaries and in joint ventures is shown in the table below.
Half Year to Half Year to Year to
30 September 30 September 31 March
2019 2018 2019
GBP000 GBP000 GBP000
------------------------------------- --------------------- ------------- ------------- ---------
Gross rental income - subsidiaries 14,506 13,527 28,154
- joint ventures 392 426 971
--------------------- ------------- ------------- ---------
Total gross rental income 14,898 13,953 29,125
Property overheads - subsidiaries (1,695) (1,919) (3,695)
- joint ventures (162) (466) (411)
Net rental expense attributable to profit share partner - 139 140
------------------------------------------------------------ ------------- ------------- ---------
See-through net rental income 13,041 11,707 25,159
-------------------------------------- -------------------- ------------- ------------- ---------
See-through Net Development Profits/(Losses)
Helical's share of development profits/(losses) from property assets held in subsidiaries and in joint ventures is shown in the table below.
Half Year to Half Year to Year to
30 September 30 September 31 March
2019 2018 2019
GBP000 GBP000 GBP000
-------------------------------------------- ------------- ------------- ---------
In parent and subsidiaries 1,567 3,565 2,564
In joint ventures 5,355 500 4,570
-------------------------------------------- ------------- ------------- ---------
Total gross development profit 6,922 4,065 7,134
Provision against stock - subsidiaries (126) (1,879) (4,345)
- joint ventures (1,083) (4,288) (7,198)
------------------------------------------- ------------- ------------- ---------
See-through development profits/(losses) 5,713 (2,102) (4,409)
-------------------------------------------- ------------- ------------- ---------
See-through Net Gain on Sale and Revaluation of Investment Properties
Helical's share of the net gain on the sale and revaluation of Investment properties held in subsidiaries and joint ventures is shown in the table below.
Half Year to Half Year to Year to
30 September 30 September 31 March
2019 2018 2019
GBP000 GBP000 GBP000
--------------------------------------------------- ----------------- --------------- ------------- ---------
Revaluation surplus on Investment properties - subsidiaries 9,442 31,435 44,284
- joint ventures 472 1,081 1,288
--------------------------------------------------------------------- --------------- ------------- ---------
Total revaluation surplus 9,914 32,516 45,572
Net (loss)/gain on sale of Investment properties - subsidiaries (28) 1,102 15,008
Total net (loss)/gain on sale of Investment properties (28) 1,102 15,008
---------------------------------------------------------------------- --------------- ------------- ---------
See-through net gain on sale and revaluation of Investment properties 9,886 33,618 60,580
----------------------------------------------------------------------------- -------- ------------- ---------
See-through Net Finance Costs
Helical's share of the interest payable, finance charges, capitalised interest and interest receivable on bank borrowings and cash deposits in subsidiaries and in joint ventures is shown in the table below.
Half Year to Half Year to Year to
30 September 30 September 31 March
2019 2018 2019
GBP000 GBP000 GBP000
---------------------------------------------- ----------------- ------------- ------------- ---------
Interest payable on bank loans and overdrafts - subsidiaries 6,756 8,263 16,414
- joint ventures 267 7 511
---------------------------------------------------------------- ------------- ------------- ---------
Total interest payable on bank loans and overdrafts 7,023 8,270 16,925
Other interest payable and similar charges - subsidiaries 2,686 1,618 4,208
- joint ventures 328 800 1,576
Interest capitalised - subsidiaries (1,127) (2,265) (3,215)
---------------------------------------------- ----------------- ------------- ------------- ---------
Total finance costs 8,910 8,423 19,494
Interest receivable and similar income - subsidiaries (1,311) (1,033) (983)
- joint ventures (41) (32) (92)
---------------------------------------------------------------- ------------- ------------- ---------
See-through net finance costs 7,558 7,358 18,419
----------------------------------------------------------------- ------------- ------------- ---------
See-through Property Portfolio
Helical's share of the Investment, trading and development property portfolio in subsidiaries and joint ventures is shown in the table below.
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
--------------------------------------------- -------------------- ------------------ ------------------ ---------
Investment property fair value - subsidiaries 835,100 754,250 791,250
- joint ventures 65,870 24,427 25,382
Investment property held for sale - subsidiaries - 125,200 - --------------------------------------------- -------------------- ------------------ ------------------ --------- Total Investment property fair value 900,970 903,877 816,632 Trading and development stock - subsidiaries 1,035 4,048 2,311 - joint ventures 53,188 53,466 56,935 -------------------- ------------------ ------------------ --------- Total trading and development stock 54,223 57,514 59,246 Trading and development stock surplus - subsidiaries 578 628 578 - joint ventures - 800 - -------------------- ------------------ ------------------ --------- Total trading and development stock surpluses 578 1,428 578 ------------------------------------------------------------------- ------------------ ------------------ --------- Total trading and development stock at fair value 54,801 58,942 59,824 -------------------------------------------------- --------------- ------------------ ------------------ --------- See-through property portfolio 955,771 962,819 876,456 ------------------------------------------------------------------- ------------------ ------------------ ---------
See-through Net Borrowings
Helical's share of borrowings and cash deposits in subsidiaries and joint ventures is shown in the table below.
At At
30 September At 31 March
2019 30 September 2018 2019
GBP000 GBP000 GBP000
------------------------------------------------------- ------------- ------------------ ---------
Gross borrowings less than one year - subsidiaries - 100,375 100,468
Gross borrowings more than one year - subsidiaries 340,603 332,290 324,814
------------------------------------ ----------------- ------------- ------------------ ---------
Total 340,603 432,665 425,282
------------------------------------------------------ ------------- ------------------ ---------
Gross borrowings more than one year - joint ventures 48,026 46,680 48,473
------------------------------------ ----------------- ------------- ------------------ ---------
Total 48,026 46,680 48,473
------------------------------------------------------ ------------- ------------------ ---------
Cash and cash equivalents - subsidiaries (47,726) (63,093) (197,570)
- joint ventures (3,551) (17,629) (7,612)
------------------------------------------------------ ------------- ------------------ ---------
See-through net borrowings 337,352 398,623 268,573
------------------------------------------------------- ------------- ------------------ ---------
27. See-through Gearing and Loan to Value
At
At At 31 March
30 September 2019 30 September 2018 2019
GBP000 GBP000 GBP000
-------------------------- ------------------ ------------------ ---------
Property portfolio 955,771 962,819 876,456
Net borrowings 337,352 398,623 268,573
Net assets 573,658 552,596 567,425
See-through net gearing 58.8% 72.1% 47.3%
See-through loan to value 35.3% 41.4% 30.6%
-------------------------- ------------------ ------------------ ---------
28. Capital Commitments
The Group has a commitment of GBP27,188,000 (30 September 2018: GBP78,746,000; 31 March 2019: GBP64,900,000) in relation to construction contracts which are due to be completed in the period to March 2021. Of the total, GBP22,406,000 relates to the Group's Investment property portfolio and GBP4,782,000 is in relation to the Group's residential scheme at Barts Square.
29. Post Balance Sheet Events
There are no material post balance sheet events.
Appendix 1 - Glossary of Terms
Capital value (psf)
The open market value of the property divided by the area of the property in square feet.
Company or Helical or Group
Helical plc and its subsidiary undertakings.
Diluted figures
Reported amounts adjusted to include the effects of potential shares issuable under the Director and employee remuneration schemes.
Earnings per share (EPS)
Profit after tax divided by the weighted average number of ordinary shares in issue.
EPRA
European Public Real Estate Association.
EPRA earnings per share
Earnings per share adjusted to exclude gains/losses on sale and revaluation of Investment properties and their deferred tax adjustments, the tax on profit/loss on disposal of Investment properties, trading property profits/losses, movement in fair value of available-for-sale assets and fair value movements on derivative financial instruments, on an undiluted basis. Details of the method of calculation of the EPRA earnings per share are available from EPRA (see Note 11).
EPRA net assets per share
Diluted net asset value per share adjusted to exclude fair value surplus of financial instruments and the Convertible Bond, and deferred tax on capital allowances and on Investment properties revaluation, but including the fair value of trading and development properties in accordance with the best practice recommendations of EPRA (see Note 24).
EPRA topped-up NIY
The current annualised rent, net of costs, topped-up for contracted uplifts, expressed as a percentage of the fair value of the relevant property.
EPRA triple net asset value per share
EPRA net asset value per share adjusted to include fair value of financial instruments and deferred tax on capital allowances and on Investment properties revaluation (see Note 24).
Estimated rental value (ERV)
The market rental value of lettable space as estimated by the Group's valuers at each Balance Sheet date.
Gearing
Group borrowings expressed as a percentage of net assets.
Initial yield
Annualised net passing rents on Investment properties as a percentage of their open market value.
Like-for-like valuation change
The valuation gain/loss, net of capital expenditure, on those properties held at both the previous and current reporting period end, as a proportion of the fair value of those properties at the beginning of the reporting period plus net capital expenditure.
MSCI Inc. (MSCI IPD)
MSCI Inc. is a company that produces independent benchmarks of property returns.
Net asset value per share (NAV)
Net assets divided by the number of ordinary shares at the Balance Sheet date (see Note 24).
Net gearing
Total borrowings less short-term deposits and cash as a percentage of net assets.
Passing rent
The annual gross rental income being paid by the tenant.
Reversionary yield
The income/yield from the full estimated rental value of the property on the market value of the property grossed up to include purchaser's costs, capital expenditure and capitalised revenue expenditure.
See-through/Group share
The consolidated Group and the Group's share in its joint ventures (see Note 26).
See-through net gearing
The see-through net borrowings expressed as a percentage of net assets (see Note 27).
Total Accounting Return
The growth in the net asset value of the Company plus dividends paid in the period, expressed as a percentage of net asset value at the start of the period.
Total Property Return
The total of net rental income, trading and development profits and net gain on sale and revaluation of Investment properties on a see-through basis.
Total Shareholder Return (TSR)
The growth in the ordinary share price as quoted on the London Stock Exchange plus dividends per share received for the period expressed as a percentage of the share price at the beginning of the period.
True equivalent yield
The constant capitalisation rate which, if applied to all cash flows from an Investment property, including current rent, reversions to current market rent and such items as voids and expenditures, equates to the market value. Assumes rent is received quarterly in advance.
Unleveraged returns
Total property gains and losses (both realised and unrealised) plus net rental income expressed as a percentage of the total value of the properties.
WAULT
The total contracted rent up to the first break, or lease expiry date, divided by the contracted annual rent.
HELICAL PLC
Registered in England and Wales No.156663
Registered Office:
5 Hanover Square
London
W1S 1HQ
T: 020 7629 0113
F: 020 7408 1666
E: reception@helical.co.uk
www.helical.co.uk
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.
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