Real Estate Credit Inves... Share Discussion Threads

[kenny] 05/9/2013 20:18

Zastas, thanks for your informative post!

[zastas] 05/9/2013 17:18

Few weeks to wait for the cash. Up to the next 3 months; I quite like these 3-monthly payments, feels like I am being paid a wage.

[kenny] 31/8/2013 17:16

Zantas, I never invest for the short term. It is a mug's game to think one can make wise choices that way.

[zastas] 31/8/2013 16:05

Meanwhile, while Mr Market's heading down - from 6800+ to 6400 - RECI and a few other uncorrelated contrarian ones are going up again. RECI back to its highs, fat divi to come soon.

[zastas] 31/8/2013 16:02

Sounds like you want to flog a few, Kenny!

I looked at them at 65-70, but wasn't brave enough; plus I think they are just too illiquid, especially when you might want get shot of them quickly.

[kenny] 30/8/2013 12:15

Should anyone be interested, I posted yesterday on the IERP bulletin board a detailed analisis of the IERP preference shares that have a running yield of 10.7% and a potential redemption yield of 17.1%. It is post 61 and it is lenghty!

[jaws6] 29/8/2013 12:34

small tick up

[kenny] 22/8/2013 11:16

Thank Dave. I think Liberum is spot on but the share price is still dawdling!

[davebowler] 21/8/2013 09:06

Liberum;
Real Estate Credit Investments (RECI / BUY) – 0.5% NAV uplift

n NAV +0.5% to 154p: NAV per share grew by 0.5% in the first half of August to 154p (31 July: 153p). NAV growth was driven by a 1.35% m-t-m gain on the bond portfolio.

n Significant sales: RECI completed £11.3m of bond sales in the period at an average price of 84% of par which represents a 50% increase from the acquisition price (56% of par).

n Imminent loan investment: RECI now has £18.4m of cash on the balance sheet in advance of a new senior loan investment on a portfolio of London offices.

Liberum View:

n RECI continues to make progress with its loan investments. The existing portfolio comprises 5 loans with a weighted average yield of 14% which account for 26% of gross assets. The imminent pipeline includes loans secured by London offices, UK hotels and London residential and loans are expected to make up 45% of GAV by the end of September.

n The imminent loan investment demonstrates the manager's ability to source deals in an increasingly competitive lending landscape particularly for prime or quality assets.

n RECI trades on a 6.0% discount to NAV and offers a prospective 6.4% dividend yield. This compares to an average 2.6% premium and 4.3% dividend yield for peers. RECI remains our top pick in this space given the manager's track record, superior NAV growth potential and access to dealflow. Our conservative 157p price target offers 15% total return over the next 12 months.

[skyship] 21/8/2013 07:24

Manager Commentary
• Increase in NAV driven by mark to market gains on the bond portfolio - up 1.35% in the month.
• RECI has increased its cash balance in the period in advance of making a senior loan secured against a portfolio of London offices.
• Sales of £11.3 million in period were sold at an average price of 84 per cent of par versus an average purchase price of 56 per cent of par.

P/F Monthly Core NAV (in £m) 31/07/20138 15/08/20138
Investment Portfolio.... 100.0... 88.7
Cash and Cash Equiv.s... 7.5..... 18.4
Derivative Assets....... -....... 0.7
Other Assets........... -....... -
....................... 107.4... 107.8

Other Liabilities....... (1.0)... (1.0)
Derivative Assets....... (0.2)... -
Preference Dividend..... (0.3)... (0.4)
Ordinary Dividend....... -....... -
Preference Share Liability (45.0).. (45.0)
....................... (46.4).. (46.4)

Net Assets (estimate).... 61.0.... 61.3
Shares outstanding...... 39,966,985 39,966,985
NAV/Ordinary Share (estimate) 1.53.... 1.54

[kenny] 14/8/2013 09:59

13 August 2013
Specialist Finance
"Real Estate Credit Investments (RECI / BUY) – Portfolio quality underscored by imminent repayments "

Imminent bond repayments: 15 of RECI's bonds are expected to redeem in full or substantially de-lever in the near term. The bonds had a market value of £9.1m at 30 June 2013 vs. a notional value of £11.0m.
NAV TR of 3.2%: As previously announced, NAV per share grew from 150p at March 2013 to 153p at 31 July 2013. NAV TR over the 4 months to July was +3.2% including the 2.2p dividend paid in June.
Progress on loan investments: Two new loan investments (secured on German multi-family properties) were completed in the period bringing loan investments as a percentage of GAV to 26.4%. In addition, RECI secured a €10.4m allocation in the new issue GRF 2013-1 Class D & E bonds.
Investment pipeline: The pipeline for new loan investments includes loans secured by London offices, UK hotels and London residential. Loans are expected to make up 45% of gross assets by the end of September.
4.5% dividend uplift: RECI's dividend has increased by 4.5% to 2.3p. This equates to a dividend yield of 6.5% on a pro-forma basis.

Liberum View:
This is a positive IMS from RECI with the imminent bond repayments highlighting the quality of the underlying collateral on the bond portfolio. We estimate the repayments could add c4p (or 2.6%) to NAV assuming they are repaid in full.
Loan investments are progressing well as RECI's differentiated access to dealflow has enabled it to build up an attractive portfolio (now yielding 13.9% with an average LTV of 63.1%). The company's ability to source deals is increasingly important as the lending market is increasingly competitive for high quality assets.

RECI trades on a wide discount to peers (7.2% discount to NAV vs. an average premium of 2.9% for asset backed debt funds) which we regard as unjustified. Our 157p target price offers 17% total return over the next 12 months with significant upside potential from the early repayment of bonds. We reiterate our BUY recommendation.
hxxp://www.recreditinvest.com/analystcoverage.html

[cerrito] 13/8/2013 09:43

Interesting-to me at at least-to compare the bond portfolio as at July 31 with that of October 31 2012; basically as has been flagged up in the investor calls decrease in class A as other investors have moved in here and an increase in D/E and under.
Oct 12 July 13
A 28.5 11.9
B 18.4 28.5
C 12.8 11.5
D 17.5 20.9
E 22.8 27.2

[skinny] 13/8/2013 08:00

RECI1 Highlights

· RECI made a net profit of £1.3 million in the quarter ended 30 June 2013, compared with £5.9 million in the previous quarter, reflecting similar levels of operating income but lower levels of fair value gains.
· From 31 March 2013 to 30 June 2013, RECI's NAV increased 0.6% from £1.50 per share to £1.51 per share2. NAV increased to £1.53 per share as at 31 July.
· As at 30 June 2013 the bond portfolio had nominal value of £103.0 million and a market value of £75.4 million.
· Since 31 March 2013, RECI made £12.5 million of new bond investments at an average yield of 7.0%.
· As at 30 June 2013, RECI's loan portfolio accounted for 23.9% of gross assets, following total investments of £7.5 million since 31 March 2013 at an average yield of 13.6%.
· The Board has declared a dividend of 2.3p per share in respect of RECI Ordinary Shares for the quarter ended 30 June 2013.



Dividend Announcement

Ordinary Dividend for RECI LN (the Core shares)

Real Estate Credit Investments PCC Limited announces today that it declares an ordinary dividend for the Core for the period 1 April 2013 to 30 June 2013 of 2.3 pence per share (a total amount of GBP 919,241). The dividend is to be paid on 27 September 2013 to ordinary shareholders on the register at the close of business on 6 September 2013. The ex dividend date is 4 September 2013.



Dividend Announcement

Preference Dividend

Real Estate Credit Investments PCC Limited announces today that it was resolved to pay a preference dividend of GBP 2 pence per preference share (a total amount of GBP 899,257) for the period 01 July 2013 to 30 September 2013. The dividend is to be paid on 30 September 2013 to preference shareholders on the register at the close of business on 06 September 2013. The ex dividend date is 04 September 2013.

[skinny] 12/8/2013 11:40

REAL ESTATE CREDIT INVESTMENTS PCC LIMITED (THE "COMPANY")

RESULT OF THE ANNUAL GENERAL MEETING

The Board of Directors of the Company is pleased to announce that, at the Annual General Meeting of the Company held today, all resolutions were approved by shareholders on a show of hands.

[skinny] 08/8/2013 16:54

Click on Liberum view.

[mozy123] 08/8/2013 16:38

Kenny do you have a link - i cant seem to locate it

[kenny] 08/8/2013 10:48

Thanks Dave. The Liberum report of 5 August is now on the company's website. I must say that the chart in that report, figure 1, vividly demonstrates how cheap RECI is compared to it's nearest rivals.

This is not a recommendation because each person should DYOR, however, I am certainly confident about the company's prospects and its excellent manager.

[skinny] 07/8/2013 15:28

They are rather !

[kenny] 07/8/2013 15:11

We should get the next dividend announcement and also an IMS some time this month.

[skinny] 05/8/2013 14:40

Interesting read - thanks.

[davebowler] 05/8/2013 14:13

hxxp://us6.campaign-archive1.com/?u=e7cabe1e5d&id=659f1bfbed&e=1e4f35f8bd

[davebowler] 05/8/2013 12:31

Liberum;
NAV +2.0%: NAV per share at 31 July was 153p which represents a rise of 2.0% over the second half of the month. Gains from material bond repayments accounted for 33% of the total portfolio value movement.

n Bond portfolio +0.5%: The m-t-m on the bond portfolio was +0.5% over the whole of July as bond prices firmed since the June sell-off.

n Loan portfolio weighting to rise: RECI's loan portfolio is forecast to rise to over 40% of total assets, up from 26.4% of the gross asset value currently, with a further loan investment anticipated in August.

Liberum View:

n RECI now trades on an 8.3% discount to NAV – some 11.2 percentage points wider than the sector average of a 2.9% premium to NAV. The 6.5% prospective dividend yield is also materially higher than the sector average of 4.7% and our 157p price target implies 18% total return over the next 12 months, with RECI's shares having risen 30% ytd.

n Figure 1 below highlights this discount/dividend yield anomaly, especially given RECI's superior NAV performance, high 88% investment level (SWEF: c.24%, LBOW: c.18%) and strong loan investment pipeline: ( graph referred to , shows SWEF and LBOW and TFIF at a premium whereas RECI is at a discount and also that their divis are lower too than RECI's -davebowler)