Rdi Reit P.l.c Share Discussion Threads

[neilyb675] 15/4/2019 15:39

results could make this BID more expensive.....

[tyranosaurus] 15/4/2019 14:50

Bid deadline 23/04/19
Results 25/04/19

Do we really expect a bid before the results ?
There seems to be little expectation of a bid as the share price is not really gathering momentum.

[neilyb675] 04/4/2019 06:48

Rule 2.6 deadline: 17:00 23-Apr-2019

[tyranosaurus] 28/3/2019 17:49

HugePants

I couldn`t agree more with your post 255.

[ramellous] 27/3/2019 13:41

Cheers Wunderbar.

[wunderbar] 27/3/2019 12:58

Ramellous, for info there was a 5 for 1 share consolidation on 11 February - with this in mind the 2.7p dividend [pre consolidation] now equates to 13.5p yielding 9.5% based on current share price of 143p. But I wouldn't take this for granted as I believe RDI will likely cut the dividend [and report double digit reduction in NAV] when they issue results on 25 April. And quickly going back to possible takeover the shareprice reaction seems somewhat muted implying market doesn't give it too much credence. I'd be very disappointed to see RDI taken out at 185p as I intended to hold long term for the generous income [hoping to see some capital appreciation along the way]. As things stand Cromwell have until 5pm on 23 April 2019 to make formal offer.

[marmar80] 27/3/2019 12:00

Agree. Was close to 1% in todays money

[ramellous] 27/3/2019 11:51

Where are you guys getting yield figures from? I’m just seeing 2.7p paid last year.

[wunderbar] 27/3/2019 09:30

According to one press report Cromwell Property Group are offering £1.85 a share. At this price I'm neither excited or interested. In my opinion this is an audacious swoop being made at a time when RDI stock has hit rock bottom c130p - currently up 14% @ 147p. Given that NAV [214p] is likely to have fallen since last valuation back in August [due to Brexit/retail fears] it seems Cromwell are merely offering book value. I'd expect majority of shareholders to reject this uninspiring offer - on the plus side it demonstrates RDI is grossly undervalued at current levels.

[grollfam] 27/3/2019 09:03

hopefully the fact that this BID has been forced into the open means other possible buyers can also put in bids resulting in a bidding war...The assets in the UK & Germany are good & the company has upgraded the portfolio steadily over the last few years .....

[alfred] 27/3/2019 09:01

Offer is 181p isn't it? (Australian Press)

[poacher45] 27/3/2019 08:47

Now we know why they decided to amalgamate 5 shares together. This always has the effect of lowering the price. On top of that they reduced the value of some of the property when actually there retail side was pretty good. They have had high salaries and just destroyed the company over the last four years. Now we face a possible cheap opportunistic bid. Absolutely poor management.

[mister md] 27/3/2019 08:25

the shares were @ 165p just last month - surely with a takeover offer its too soon to be selling now at 153p ?

[hugepants] 27/3/2019 07:47

Will 180p do it?

[hugepants] 21/3/2019 11:53

A dividend cut and NAV reduction look like a certainty in next months results. Not sure how low this can go but I've been purchasing some shares into this weakness

[macthepak] 02/3/2019 04:15

The problem with retail parks and shopping centres should have been recognised back in 2017.

Some of the cash from recent sales should have been used to reduce the loans on these retail and shopping centres.

If the dividend is cut I expect the share price to fall to maintain a yield between 8 and 10%. This is not good for the long term investor but a great buying opportunity for a new investor if and when the announcement is made for a dividend cut expect a sharp fall in the share price.

PS I still follow RDI for old times, I know longer hold any shares in RDI.

[wunderbar] 28/2/2019 23:48

Hi Ragged, your sums appear correct as is fact a REIT has to payout 95% of income. UK retail sector accounts for 29% of RDI portfolio so this equates to NAV of 62p (total NAV reported at 214p back in August). If as you say we half the value of UK retail portfolio we lose 30p a share giving a NAV of 184p. On this basis we're currently trading at 25% discount based on today's closing price of 138p.

As for the dividend - well I guess if 2019 annual profits come in flat (c.£54m) then by rights they should payout c.13p a share (9.5% yield at current price). Trouble is they've acknowledged UK retail sector is coming under pressure which is likely to hit income - lower income equals lower payout ratio equals lower dividend. And of course we're assuming the rest of RDI's portfolio doesn't suffer either. I still think the dividend will be cut by minimum 25% but happy to be proved wrong.

[raggedtp] 28/2/2019 17:23

I am a recent buyer of RDI, thinking its discount to NAV unjustifiably low. Even if they had to halve the whole retail side it would make only 14% difference, or 30p, wouldn't it?

"Net operating cashflows from the [affected]portfolio after interest costs are approximately £6.5 million on an annualised basis."

That is less than 7% of total income.

"As a result, underlying earnings for the first half of this financial year are expected to be broadly in line with the second half of the previous year, before taking into account the non-recurring finance charge of £0.9 million. Distributions will need to take account of the above and the cashflows being applied to the Aviva facility. "

So, wipe out 7% and the non-finance charge of £.9m, which is about 1% of last year's PBT, = 8% div decline. Doesn't a REIT have to pay out 95% of income?

Would welcome your thoughts as, while frustrated, I feel the fall is overdone and am thinking about buying more at this level.

[eeza] 28/2/2019 17:18

"According to RDI's website they are "committed to becoming the UK’s leading income
focused REIT". That's a all very well and good but consider the fact share price has fallen year on year for past 4 years - any dividends paid out have been dwarfed by capital erosion. RDI management need to get their act together or face the wrath of shareholders/institutions baying for new blood."

Exactly what I posted above.
Failed management whose only answer to share price falling for 4 yrs is to have a share-split.
Ego trip for management (who don't want to be seen overseeing a 'penny stock') - paid for by long suffering s/hlders.
The TU reads like total BS. Which is what it is.
This has become a bargepole stock.

Handcrankers.
Need to acquaint themselves with the rules for Universal Credit.

Well done management - earned your bonuses.

[wunderbar] 28/2/2019 11:46

Todays pre-close update has not been well received - share price currently down 10% @ 135p. So much for the consolidation doing wonders for the share price - so far it's been a disaster (down c.17%). I personally preferred the perceived penny stock status as share price movement was relatively tight/stable whereas now it's become uncharacteristically volatile and leaves the share price vulnerable to further market manipulation.

As for today's sharp fall I believe this is attributable to a loan with Aviva on four UK shopping centres - the company states "Given the deterioration in values for UK shopping centres and the resultant increase in the lender’s loan to value ratio, all net operating cashflows from this portfolio are being retained within the facility and are anticipated to be used to reduce the outstanding facility balance. Net operating cashflows from the portfolio after interest costs are approximately £6.5m on an annualised basis". In other words a loan covenant has been breached/triggered as a result of falling values of the centres which means under the terms of the loan RDI cannot use proceeds from this estate to reinvest in other parts of the business or contribute towards dividend payments.

The company goes on to say "the board has continued to place a greater emphasis on liquidity and maintaining lower levels of leverage. Net disposal proceeds generated in the prior financial year and limited reinvestment has resulted in approximately £40m being retained and applied toward lower leverage."

Reading between the lines I think investors should brace themselves for a steep dividend cut - I reckon anything between 25-40% (reducing payout to 8-10p p/s giving a yield of 6-7% at current levels). Today's fall has pushed RDI's yield up to c.10% (13.5p).

Given the ongoing concerns re UK retailing it's safe to say NAV will also be taking a hit come Interim results. In August NAV was reported @ 42.8p (214p post consolidation). For info 29% of RDI's portfolio is exposed to this sector (18% shopping centres and 11% retail parks) - personally I'd like to see overall exposure reduced to 15-20%. It's somewhat hard to gauge the overall impact these inevitable writedowns will have on NAV but for the sheer hell of it I'm going to factor in a 30% decrease (hopefully this is worst-case scenario) which implies a NAV of 150p.

According to RDI's website they are "committed to becoming the UK’s leading income
focused REIT". That's a all very well and good but consider the fact share price has fallen year on year for past 4 years - any dividends paid out have been dwarfed by capital erosion. RDI management need to get their act together or face the wrath of shareholders/institutions baying for new blood.

[eeza] 15/2/2019 21:36

Ego trip for BOD, is the main driver.

Remains to be seen whether it drops back to the pre-split price, but a lot do.