Picton Property Income Ld Share Discussion Threads

[skyship] 24/7/2020 07:06

Agreed, a reasonable set of results, but that's about all. The valuation does rather benefit from PCTN's past reputation of a safe pair of hands. The 25% notional NAV discount & low 3.8% yield certainly doesn't work for me; perhaps more of an institutional HOLD.

Compare the stats to EPIC's well covered 7.8% yield and 43% discount.

[nickrl] 23/6/2020 14:10

Daniel going forward they've lowered the divi to annualised 2.5p v 3.5p which is prudent but high entry point imo for that yield but depends on your view on whether they will recover rental value back to previous levels anytime soon

[danielbird193] 23/6/2020 11:58

Thanks, I hadn't spotted it was results day. I have been burying my head in the sand a bit in respect of my property exposure, but PCTN has always been a quality operator and that quality has shone through in the recent crisis.

While they haven't been immune from the struggles of the wider commercial property sector, the fact that their NAV per share has held steady over the year we've just had shows real skill from management. In particular, selling assets above book value and using the proceeds to pay down debt seems to have been a sensible move in the current environment. The company's leverage ratio is modest and the fact they've maintained the dividend shows there isn't an imminent cash crunch.

I continue to be a happy holder here.

[nickrl] 23/6/2020 09:32

Reasonable set of results and good detail on rent collection actions to recover the defect (mainly retail/leisure) but overall is 82% collected with another 9% on revised terms (when they get cash isn't clear though!). LTV is in good shape at 22% and they had already flagged a divi reduction from 3.5 to 2.5p for this year which if they maintain c80% in June qtr is covered but thats 3.6% at current share price There vacant properties are costing them £3m a year although i suspect its mainly the Covenant Garden asset but does indicate the scale of the threat to London centric propco's if vacancies end up on there books.

Should have had a nibble when it was sub 60p a few weeks back as it will attract interest interest I suspect with its reasonable broad portfolio.

[bscuit] 29/4/2020 22:01

Following on from the English rent shortfall at the last rent date do we know the percentage by rent roll of the Scottish/NI properties?

[speedsgh] 20/3/2020 07:28

Picton completes trio of lettings -

Picton today issues an update on the portfolio following the completion of a series of office leases, which add a total of £0.9 million of annual income to the headline rent roll. The transactions follow the completion of recent refurbishment works.

Metro Building, Salford Quays - Let the 4th floor to HM Government on a 20-year lease subject to break in 2030 at £0.4 million per annum, which was in line with the December 2019 ERV.

180 West George Street, Glasgow - Let the 3rd floor on a 10-year lease, subject to break in 2025, at £0.2 million per annum, which was in line with the December 2019 ERV.

Tower Wharf, Bristol - upsized an existing occupier and extended a lease which was due to expire in May 2020. This increased their floor space by 73% and secured a new 15-year lease, subject to break in 2030, at a rent of £0.5 million per annum, which was in line with the December 2019 ERV and £0.3 million ahead of the previous passing rent.

The Company will provide a trading update in April 2020.

Michael Morris, Chief Executive of Picton, commented:

“To have recently concluded three significant long-term leases following our refurbishment of these spaces is encouraging.

Our immediate priority is ensuring the health and safety of our occupiers, employees and other partners, as we seek to minimise the impact of the COVID-19 virus. We are continuing to work with our occupiers to help them navigate these uncertain times.

We have a strong balance sheet with primarily long-dated debt, a low LTV of 22% and access to more than £41 million of funding in two undrawn debt facilities.”

[speedsgh] 03/2/2020 11:28

Dividend Declaration -

Picton today announces an interim dividend payment in respect of the financial
period from 1 October 2019 to 31 December 2019, of 0.875 pence per share.

The dividend timetable is set out below:

Ex-Dividend Date - 13 February 2020

Record Date - 14 February 2020

Pay Date - 28 February 2020

The dividend of 0.875 pence per share will be designated as a property income
distribution ('PID').

[speedsgh] 03/2/2020 11:27

Net Asset Value as at 31 December 2019 -

NAV growth and strengthened balance sheet through debt reduction

* Net assets increased to GBP519.1 million (30 September 2019: GBP510.7 million).
* NAV/EPRA NAV per share rose 1.7% to 95.2 pence (30 September 2019: 93.6
pence).
* Total return for the quarter of 2.6% (30 September 2019: 1.6%).
* LTV reduced to 22.4% (30 September 2019: 24.5%).

Dividend declared

* Dividend of 0.875 pence per share declared and to be paid on 28 February
2020 (30 September 2019: 0.875 pence per share).
* Annualised dividend equivalent to 3.5 pence per share, delivering a
dividend yield of 3.5%, based on 30 January 2020 share price.
* Dividend cover for the quarter of 114% (30 September 2019: 114%).

Further valuation uplift driven by asset management

* Like-for-like increase in property portfolio valuation for the quarter of
1.4% (30 September 2019: 0.7%) driven primarily by industrial and regional
office sector gains.
* GBP3.3 million invested in over 10 refurbishment and repositioning projects.
* Secured an average increase of 11% against the September ERV from nine
lease events (renewals, regears and one rent review), with a combined
annual rent of GBP3.0 million.
* Completed nine lettings on average 3% ahead of the September ERV, with a
combined annual rent of GBP0.5 million.
* Agreed to pre-lease Shipton Way, Rushden, to Whistl UK Limited at an annual
rent of GBP1.6 million who will become the Company's largest single occupier
from October 2020, when the existing occupier vacates.
* Completed the disposal of an office building in Croydon for GBP18.2 million.
* Stable occupancy of 88% (30 September 2019: 88%).

Nick Thompson, Chairman of Picton, commented:

"We have delivered another positive uplift in net assets, whilst at the same
time reducing borrowings and increasing the amount available under our
revolving credit facilities to capitalise on any emerging opportunities."

Michael Morris, Chief Executive of Picton, commented:

"The asset management activity over the quarter, driven by a number of key
leasing and regear transactions, has delivered further growth. Our primary
focus is our refurbishment programme and corresponding leasing activity to
drive both income and value."

[skyship] 12/11/2019 21:17

90% as at Mar'19

[sleepy] 12/11/2019 20:53

From last years half year results:

“As anticipated, there was a reduction in occupancy over the period from 96% to 94%. The decrease, which we expect to be short term”

[speedsgh] 12/11/2019 07:57

Half Year Results -

Picton announces its half year results for the period to 30 September 2019.

Continued Growth in Net Assets
* Profit after tax of £14.5 million
* Total return of 2.8%
* Increase in EPRA net asset value per share of 0.9%, to 94 pence per share

Strengthened Balance Sheet
* Raised £7.1 million of new equity at a 1.9% premium to the March net asset value
* Repaid £7.6 million of borrowings
* Loan to value ratio reduced to 24.5%
* Dividend cover of 107%

Outperforming Property Portfolio
* Total property return of 3.2%, outperforming the MSCI UK Quarterly Property Index of 0.8%
* Total property return and income return outperforming MSCI over 1, 3, 5 and 10 years
* Like-for-like valuation increase of 1.2%, driven by industrial and office sectors
* 14 lettings completed with a rent roll of £1.5 million per annum
* 20 lease renewals completed with a rent roll of £1.2 million per annum
* 12 rent reviews completed securing an uplift in rent of £0.5 million per annum

Investing for Income and Capital Growth
* £2.8 million invested in refurbishment projects
* Occupancy of 88%
* 79% of the void space under refurbishment
* £9.4 million of reversionary potential

Picton Chairman, Nicholas Thompson, commented:

“During the last six months we have been able to further strengthen our balance sheet, increasing net assets and maintaining a covered dividend. Our June fundraising has enabled us to continue to invest into our portfolio, enhancing the quality of our assets for occupiers and shareholders alike.”

Michael Morris, Chief Executive of Picton, commented:

“There has been an encouraging level of activity in the portfolio over the past six months. With an estimated £9.4 million of reversionary potential to be unlocked, we believe there is significant upside to come from refurbishment and leasing initiatives.”...

[petewy] 08/11/2019 14:49

Results Tuesday

[speedsgh] 17/9/2019 08:23

Portfolio Update -

Picton (LSE: PCTN), is pleased to provide an update on the portfolio following a period of significant activity since its June NAV update.

Progress has been made across all sectors with the completion of 20 asset management initiatives including lettings, lease renewals, regears and rent reviews. These have a combined annual rent of £2.4 million per annum and were agreed on average 4% ahead of the June 2019 estimated rental values (ERVs).

In addition, the Company has started to deploy the capital raised in June, having completed two refurbishment projects, where occupiers have been identified and terms agreed in principle. Projects have commenced at a further seven assets, all of which are aimed at enhancing occupancy and rental income.

A further update will be provided in the Company’s interim results to 30 September 2019 which are expected to be released in November.

Michael Morris, Chief Executive of Picton, commented:

“We have been encouraged by the level of portfolio activity over the traditionally quieter summer period, especially given the current political backdrop. Since raising capital to invest in the portfolio in June, we have made significant progress on the identified projects and have already both attracted and retained new and existing occupiers, improving the income profile. We are continuing to invest in our portfolio and unlock future opportunities to improve occupancy and rental income.”

The principal activity across sectors is as follows......

[speedsgh] 29/7/2019 08:39

Dividend Declaration -

Picton (LSE: PCTN), today announces an interim dividend payment in respect of
the financial period from 1 April 2019 to 30 June 2019, of 0.875 pence per
share.

The dividend timetable is set out below:

Ex-Dividend Date - 8 Aug 2019

Record Date - 9 Aug 2019

Pay Date - 30 Aug 2019

The dividend of 0.875 pence per share will be designated as a property income
distribution ('PID').

[speedsgh] 29/7/2019 08:38

Net Asset Value as at 30 June 2019 -

Picton (LSE: PCTN) announces its Net Asset Value for the quarter ended 30 June
2019.

Highlights during the quarter included:

NAV growth and enhanced balance sheet through fundraising

* Net Assets increased to GBP508.4 million (31 March 2019: GBP499.4 million).
* NAV/EPRA NAV per share rose 0.3% to 93.0 pence (31 March 2019: 92.7 pence).
* Raised GBP7.1 million of new equity at a 1.9% premium to the March NAV.
* LTV reduced to 24.1% (31 March 2019: 24.7%)
* Total return for the quarter of 1.3% (31 March 2019: 1.2%).

Dividend declared

* Dividend of 0.875 pence per share declared and to be paid on 30 August 2019
(31 March 2019: 0.875 pence per share).
* Annualised dividend equivalent to 3.5 pence per share, delivering a
dividend yield of 3.7%, based on 25 July 2019 share price.
* Dividend cover for the quarter of 100% (31 March 2019: 113%).

Valuation uplift primarily driven by asset management initiatives

* Like-for-like increase in property portfolio valuation for the quarter of
0.5% (31 March 2019: 0.2%) driven primarily by industrial sector gains.
* Completed seven lease renewals / regears and uplifts secured on three rent
reviews, on average 7% ahead of the March ERV, with a combined annual rent
of GBP1.6 million.
* Completed four lettings on average 5% ahead of the March ERV, with a
combined annual rent of GBP0.6 million.
* Active management completed to remove or extend four break options,
securing GBP1.2 million of income the majority of which was at risk in the
next 12 months.
* Stable occupancy of 90%, with a number of refurbishment projects underway
(31 March 2019: 90%).

Nick Thompson, Chairman of Picton, commented:
"We have delivered another positive set of results during a quarter in which we
also raised equity on a non-dilutive basis. This equity has been used initially
to reduce borrowing from our revolving credit facilities ahead of it being
deployed in a timely and cost-efficient manner into asset enhancing projects."

Michael Morris, Chief Executive of Picton, commented:
"Overall the portfolio has responded well to our various asset management
initiatives and fluctuations in the market. During the period, we have invested
nearly GBP1 million into refurbishment and repositioning projects, which will now
enable us to improve income. Furthermore, leasing transactions over the quarter
have completed ahead of the independently derived rental valuations and we are
continuing to make good progress on several value-enhancing asset management
initiatives, which all bodes well for the future."

[ugandalad] 30/6/2019 08:18

I have a slight discomfort over these book building capital raising run by the Fund management xstockbroking Industry but the low cost and the apparent full value being paid is also reassuring.

[skyship] 30/6/2019 07:11

Very well managed operation; however recent performance slightly damaged by their Retail holdings.

At the issue price of 94.5p the places would have been asked to buy at a 1.6% NAV premium and a 3.6% yield; so personally I wouldn't have seen much of an attraction.

At the share price of 98p that NAV premium rises to 5.3%; so IMO quite clearly the shares are now a sell on valuation grounds.

There are some really bizarre valuation discrepancies currently. Take CREI @ 120p on a 10% premium and 5% yield. LXI at 127p on an 11% premium and 4.3% yield - and both companies managing to make large equity issues at those NAV premiums. I just don't get it!

[speedsgh] 19/6/2019 07:55

Likewise. Can't help but think they might be disappointed with raising only £7.1m, although they were cute to not advertise how much they were actually targeting to raise in the first place. Might be wider implications for the sector if a quality operator like Picton have indeed struggled to raise even a relatively small amount of capital.

[danielbird193] 19/6/2019 07:45

Not a bad result but I thought they'd raise more. The asset management initiatives identified in the 'Proposed Placing' RNS were costed at £15 million so I was expecting them to get away £12 million at least.

[speedsgh] 19/6/2019 07:37

The placing has raised gross proceeds of £7.1m...

Results of Proposed Placing -

[speedsgh] 13/6/2019 13:11

Picton Property launches share issue as LXi Reit raises £200m -

[danielbird193] 13/6/2019 07:47

Sounds sensible but I wish they'd include details of how much additional rent roll will result from the planned capex (or at least give a targeted IRR for the additional capital raised). If the IRR isn't higher than their WACC then it's a foolish move. I assume they (or their bankers) have done their sums so why don't they give humble investors this information?

[speedsgh] 12/6/2019 17:04

Proposed placing at 2.4% discount to yday's closing price. No confirmation of exactly how much they are seeking to raise but one assumes it might be in the region of £15m as they allude to having "identified in excess of 20 separate asset management initiatives in its portfolio, with total costs of approximately £15 million". Of course, if there is appetite amongst IIs for more, they may well take advantage of the additional demand. Proceeds will initially be used to reduce amounts currently drawn on their revolving credit facilities. Placing is only open to IIs.

Proposed Placing -

The Board of Directors of Picton (the ''Board'') announces a proposed placing of new ordinary shares in the Company (the "Placing" and the "Placing Shares" respectively) at a price of 94.5 pence per Placing Share (the "Placing Price").

The Placing Price represents a discount of 2.4 per cent to the closing share price of 96.8 pence per existing ordinary share in the capital of the Company ("Ordinary Share") on 11 June 2019 (being the last business day prior to the date of this announcement) and a premium of 1.9 per cent to the Company's last reported EPRA NAV per Ordinary Share as at 31 March 2019 of 92.7 pence...

USE OF PROCEEDS
The Group has identified in excess of 20 separate asset management initiatives in its portfolio, with total costs of approximately £15 million, which it is seeking to progress further over the short to medium term. These opportunities are expected to improve the quality of the existing portfolio and are intended to deliver higher occupancy, rental income and capital values over time, including:

· upgrading and repositioning internal space;

· converting assets to higher value uses; and

· enhancing the external fabric of some assets to help maintain and attract new occupiers.

Furthermore, the Company continues to explore other investment opportunities and, owing to its strong reputation as well as its attractive corporate and management structure, is well positioned to source asset and portfolio opportunities which may arise as a result of the ongoing volatility and uncertainty in the market.

The Group has two revolving credit facilities with Santander, of which £26 million was drawn as at 31 March 2019. The net proceeds of the Placing will be immediately deployed to reduce the amounts drawn on these facilities, thereby avoiding any cash drag on investment returns as well as providing the Company with increased financial flexibility to take advantage of investment opportunities that may arise...

The Placing is currently expected to close at 11.00 a.m. (London time) on 18 June 2019 and the results of the Placing will be announced as soon as practicable thereafter.

[mushypeas] 04/6/2019 07:46

2w:-
Picton was previously domiciled in the channel islands where no corporation tax was levied. The UK treasury is now bearing down on this tax exemption - hence the change to UK REIT status and with it no effective change in the distributions for an ISA investor.

[2wild] 03/6/2019 21:31

REITs don't pay tax on rental income. Theforere shareholders are taxed at 20% upfront on PID divs. Shares held in an ISA or pension are exempt, but providers need to let the company know.
I don't get why this div was not increased as Picton are not now paying tax and are require to distribute 90% of income under REIT rules.