Picton Prop Inc Ltd Net Asset Value as at 31 December 2020

 
TIDMPCTN 
 
28 January 2021 
 
                        PICTON PROPERTY INCOME LIMITED 
                   ("Picton", the "Company" or the "Group") 
                           LEI: 213800RYE59K9CKR4497 
 
                    Net Asset Value as at 31 December 2020 
 
Picton announces its Net Asset Value for the quarter ended 31 December 2020. 
 
Financial Highlights 
 
·    Net assets of £521.0 million (30 September 2020: £505.9 million). 
 
·    NAV/EPRA NAV per share increased by 3.0% to 95.5 pence (30 September 2020: 
92.7 pence). 
 
·    NAV total return for the quarter of 3.7% (30 September 2020: 1.3%). 
 
·    LTV of 21.3% (30 September 2020: 22.4%). 
 
Operational Highlights 
 
·      Like-for-like portfolio valuation uplift of 2.7% over the quarter. 
 
·      Completed six lettings, all in the office sector, 4% ahead of the 
September 2020 ERV with a combined annual rent of £0.7 million. 
 
·      Secured an average increase of 15% against the previous passing rent 
from eight lease events (six renewals and two rent reviews), with a combined 
annual rent of £0.7 million which was 2% ahead of the September 2020 
ERV. 
 
·      Disposal of retail asset for £3.98 million completed with high street 
retail exposure reduced to 3%. 
 
·      Stable occupancy of 90% (30 September 2020: 90%). 
 
Rent Collection 
 
·      87% of December 2020 rents have been collected or are expected to be 
received under monthly payment plans. The collection rate is expected to 
improve further over the coming weeks. 
 
·      Rent collection rates of 95% for September 2020, 95% for June 2020 and 
90% for March 2020. 
 
·      In respect of the remaining rent outstanding, ongoing discussions and 
active management opportunities are expected to further improve either the 
income or capital position of the portfolio. The NAV includes a provision of £ 
2.6 million in respect of outstanding sums. 
 
Increased Dividend Declared 
 
·       Dividend of 0.8 pence per share declared and to be paid on 26 February 
2021 (30 September 2020: 0.7 pence per share). 
 
·       Annualised dividend equivalent of 3.2 pence per share, delivering a 
dividend yield of 4.1%, based on 26 January 2021 share price. 
 
·       Dividend cover for the quarter of 122% (30 September 2020: 178%). 
 
Nick Thompson, Chairman of Picton, commented: 
 
"I am pleased that we have been able to deliver such a strong uplift in net 
assets during the period, which combined with our improving operating 
performance, including resilient rent collection, gives us the confidence to 
increase the dividend further, following the increase announced just last 
November." 
 
Michael Morris, Chief Executive of Picton, commented: 
 
"This has been the second consecutive quarter where we have delivered portfolio 
growth, with the largest NAV uplift since December 2017, driven principally by 
our exposure to South East industrial assets and our heavily underweight retail 
exposure." 
 
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET 
ABUSE REGULATION (EU) NO. 596/2014 
 
For further information: 
 
Tavistock 
 
Jeremy Carey/James Verstringhe, 020 7920 3150, 
[e-mail] 
 
Picton 
 
Michael Morris, 020 7011 9980, [e-mail] 
 
Note to Editors 
 
Picton, established in 2005, is a UK REIT. It owns and actively manages a £675 
million diversified UK commercial property portfolio, invested across 46 assets 
and with around 350 occupiers (as at 31 December 2020). Through an occupier 
focused, opportunity led approach to asset management, Picton aims to be one of 
the consistently best performing diversified UK focused property companies 
listed on the main market of the London Stock Exchange. 
 
For more information please visit: www.picton.co.uk 
 
 
 
 
NET ASSET VALUE 
 
The unaudited Net Asset Value ('NAV') of Picton, as at 31 December 2020, was £ 
521.0 million, reflecting 95.5 pence per share, an increase of 3.0% over the 
quarter, or 3.7% on a total return basis. 
 
The NAV attributable to the ordinary shares is calculated under IFRS and 
incorporates the independent market valuation as at 31 December 2020, including 
income for the quarter, but does not include a provision for the dividend this 
quarter, which will be paid in February 2021. 
 
 
                            31 Dec 2020    30 Sept 2020   30 Jun 2020    31 Mar 2020 
                              £million       £million       £million      £million 
 
Investment properties*         662.5          650.6          648.9          654.5 
 
Other assets                    23.2           22.6           23.0          19.1 
 
Cash                            22.6           18.9           19.4          23.6 
 
Other liabilities              (20.8)         (19.4)         (20.9)        (20.4) 
 
Borrowings                    (166.5)        (166.8)        (167.2)        (167.5) 
 
Net Assets                     521.0          505.9          503.2          509.3 
 
Net Asset Value per share      95.5p          92.7p          92.2p          93.4p 
 
*The investment property valuation is stated net of lease incentives. 
 
The movement in Net Asset Value can be summarised as follows: 
 
                                Total         Movement      Per share 
                               £million          %            Pence 
 
NAV at 30 September 2020        505.9                          92.7 
 
Movement in property values      14.0           2.8            2.6 
 
Net income after tax for         4.7            0.9            0.9 
the period 
 
Dividends paid                  (3.8)          (0.7)          (0.7) 
 
Other                            0.2             -              - 
 
NAV at 31 December 2020         521.0           3.0            95.5 
 
DIVID DECLARATION 
 
A separate announcement has been released today declaring an increased dividend 
of 0.8 pence per share in respect of the period 1 October 2020 to 31 December 
2020, reflecting a 14% uplift on the preceding quarter (1 July 2020 to 30 
September 2020: 0.7 pence). 
 
Dividend cover over the quarter was 122% (30 September 2020: 178%), including 
the higher dividend paid in November. 
 
RENT COLLECTION 
 
The Group has received 76% of the rent for the December quarter, which 
increases to 87% including agreed monthly payments. These collection figures 
are slightly better than the September numbers calculated after the same number 
of days. 
 
The table below sets out the rent collection statistics for the December 
quarter, analysed by sector. 
 
 
                               Total        Industrial      Offices       Retail & 
                                                                           Leisure 
 
Collected                       76%            72%            85%            64% 
 
Moved to monthly                11%            14%             0%            26% 
 
Outstanding                     13%            14%            15%            10% 
 
A provision of £2.6m has been made in relation to all outstanding sums, this 
has reduced the NAV per share by 0.4p. 
 
DEBT 
 
Total borrowings at 31 December 2020 were £166.5 million, drawn under long-term 
fixed rate facilities. The net loan to value ratio, calculated as total debt 
less cash, as a proportion of gross property value, is 21.3% (30 September 
2020: 22.4%). 
 
The weighted average debt maturity profile of the Group is approximately 9.2 
years and the weighted average interest rate is 4.2%. 
 
Picton has £50 million available through its undrawn revolving credit facility. 
 
PORTFOLIO UPDATE 
 
Like-for-like, the portfolio valuation increased over the quarter by 2.7% or £ 
17.5 million, and £1.7 million of capital expenditure was incurred across the 
portfolio during the period. The valuation movements over the quarter are shown 
below: 
 
Sector                              Portfolio    Like-for-like 
                                   Allocation Valuation Change 
 
 
Industrial                              52.4%             7.9% 
 
South East                              39.4% 
 
Rest of UK                              13.0% 
 
Offices                                 36.4%           (2.5)% 
 
London City and West End                 8.7% 
 
Inner and Outer London                   5.1% 
 
South East                              11.1% 
 
Rest of UK                              11.5% 
 
Retail and Leisure                      11.2%           (2.5)% 
 
Retail Warehouse                         6.7% 
 
High Street - Rest of UK                 3.0% 
 
Leisure                                  1.5% 
 
 
Total                                    100%             2.7% 
 
Positive performance continued in the industrial sector on the back of high 
occupancy, proven rental growth and strong investor demand, leading to the 
sector repricing. 
 
The ongoing refurbishment of Stanford Building in Covent Garden has 
substantially completed, with the first office letting secured 3% ahead of the 
September 2020 ERV. Other key office lettings completed in Cardiff, Bristol and 
Chatham, Kent, 4% ahead of the September ERV. Despite this, office demand was 
more muted, leading to a valuation decline in this sector. 
 
The decrease in the retail and leisure sector was driven by the continued 
repricing and impact of Covid-19. Retail warehousing was less impacted than 
High Street retail assets. 
 
As at 31 December 2020, the portfolio had a net initial yield of 4.7% (allowing 
for void holding costs) or 4.8% (based on contracted net income) and a net 
reversionary yield of 6.2%. The weighted average unexpired lease term, based on 
headline rent, was 5.0 years. 
 
Occupancy was maintained at 90%. 
 
The top ten assets, which represent 56% of the portfolio by capital value, are 
detailed below. 
 
Asset                                   Sector             Location 
 

Parkbury Industrial Estate, Radlett     Industrial         South East 
 
River Way Industrial Estate, Harlow     Industrial         South East 
 
Angel Gate, City Road, EC1              Office             London 
 
Stanford Building, Long Acre, WC2       Office             London 
 
Tower Wharf, Cheese Lane, Bristol       Office             South West 
 
Datapoint, Cody Road, E16               Industrial         London 
 
Shipton Way, Rushden, Northants         Industrial         East 
                                                           Midlands 
 
50 Farringdon Road, EC1                 Office             London 
 
Lyon Business Park, Barking             Industrial         Outer 
                                                           London 
 
Colchester Business Park, Colchester    Office             South East 
 
MARKET BACKGROUND 
 
According to the MSCI Monthly UK Property Index, the All Property total return 
was 2.1% for the quarter to December 2020, compared to 0.7% for the previous 
quarter. 
 
Capital growth was 0.8% (September 2020: -0.7%) and rental growth was -0.4% for 
the quarter (September 2020: -0.7%). A more detailed breakdown of the MSCI 
Monthly Digest is shown below: 
 
MSCI capital growth 
 
                                                    Number of MSCI segments 
 
                              Quarterly growth Positive growth  Negative growth 
 
Industrial                          5.4%              7                0 
 
Office                             -1.2%              0                10 
 
Retail                             -2.4%              1                19 
 
All Property                        0.8%              8                29 
 
MSCI rental growth 
 
                                                    Number of MSCI segments 
 
                              Quarterly growth Positive growth  Negative growth 
 
Industrial                          1.1%              6                1 
 
Office                             -0.1%              5                5 
 
Retail                             -2.1%              0                20 
 
All Property                       -0.4%              11               26 
 
                                     ENDS 
 
 
 
END 
 
 

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January 28, 2021 02:00 ET (07:00 GMT)