Real Estate Credit Inves... Share Discussion Threads

[skinny] 27/11/2013 07:07

Cell Ordinary Dividend for ERII LN (the Cell shares)

Real Estate Credit Investments PCC Limited announces today that it declares a Cell ordinary dividend for ERII for the period 1 July 2013 to 30 September 2013 of 4.8 cents per share (a total amount of EUR 738,823). The dividend is to be paid on 31 December 2013 to Cell ordinary shareholders on the register at the close of business on 06 December 2013. The ex dividend date is 04 December 2013.

[skinny] 27/11/2013 07:06

RECI[1] First-Half Highlights

· RECI reported a net profit of £3.9 million for the half-year ended 30 September 2013, including a profit of £2.7 million in the second quarter of the financial year
· £14.9 million of new bond investments and £27.8 million of new loan commitments made in the first half. Further £16.4 million of loan commitments made subsequent to the second quarter end
· RECI raised £50 million through a placing on 12 November 2013. The Company expects to invest the capital within six months predominantly in loans at double-digit yields
· RECI declared a dividend of 3.4p per share (equating to a 6% annualised yield on NAV) in respect of RECI Ordinary Shares up to the period up to 11 November
· The Directors intend to announce a full quarter's dividend for the quarter ended 31 December at 6 per cent of NAV, thereafter RECI will increase its target annualised dividend yield, to a minimum of 7 per cent of the placing price of the capital raise

[davebowler] 13/11/2013 10:52

Its now, at last, trading at a premium to NAV (as far as we can tell) just like the undeserving LBOW. TFIF and HDIV (high annual management fees though) too trade at a premium but more deservedly so in my view.
Our gearing is now at a lowish level and yet the dividend is to be hiked.All good.

[davebowler] 13/11/2013 10:45

Liberum;
Real Estate Credit Investments (RECI / BUY) - Dividend to rise from Q1 2014



n New core shares commenced trading: The 32,851,511 new core shares commenced trading yesterday and RECI's market capitalisation is now £113.6m.



n Dividend yield to rise to 7%: From Q1 2014, the company will target a dividend yield of a minimum of 7% of the placing price of 152.2p, payable quarterly.



n All shareholders to get full Q4 dividend: In addition, both new and existing shareholders will receive the full Q4 dividend (current targeted level is 6% of NAV per annum), even though new core shareholders have only been invested for part of the quarter. The dividend will be announced alongside the February IMS.



n Management fee cut: Furthermore, going forward the management fee has been cut from 1.75% to 1.25% per annum on the adjusted NAV.

[gary1966] 05/11/2013 08:05

NAV unchanged and core shares issued at 152.2p. Divi should now be 10.6p+pa.

[davebowler] 04/11/2013 10:07

TFIF is at a 4% premium (and has just raised a large amount of fresh equity) whereas we are at NAV.

[skinny] 23/10/2013 14:01

Yes - already edited! :-)

[stupidboypike] 22/10/2013 16:37

NAV up a penny in 2 weeks. I like it. Best regards SBP

[gary1966] 22/10/2013 14:20

Pro Forma Monthly RECI Core NAV1 (in £ million) 30/09/20138 15/10/20138
Investment Portfolio2 101.4 101.7
Cash and Cash Equivalents 5.4 6.0
Derivative Assets 1.1 0.8
Other Assets 3,4 - -
107.9 108.4

Other Liabilities5 (1.0) (1.0)
Preference Dividend6 - (0.1)
Ordinary Dividend7 - -
Preference Share Liability (45.0) (45.0)
(46.0) (46.1)

Net Assets (estimate) 62.0 62.30
Shares outstanding 39,966,985 39,966,985
Net Assets per Ordinary Share (estimate) 1.55 1.56

[minimal] 21/10/2013 11:24

Still moving sideways, which surprises me. I suppose it's a symptom of the low volumes, but this stock is really strong imho. (Especially given recent press and market trends)

[drewz] 17/10/2013 13:11

Top stuff!

[davebowler] 17/10/2013 09:42

Liberum;


Specialist Finance

Real Estate Credit Investments (RECI / BUY) - Successful £50m placing



n £50m placing: Further to the announcement on 23 September 2013, RECI has completed a placing of new core shares to raise gross proceeds of £50m.



n Placing price: The placing price of the new shares will be the NAV at 31 October 2013 less dividends declared (3.4p per share) for the period from 1st July 2013 to the date of admission and will be announced on 5 November.



n Target dividend to rise to 7% of placing price: As previously announced, the board will increase the target dividend to 7% of the placing price (comfortably ahead of the peer group average of 4.3%).



n Market opportunities: The proceeds will be invested in a combination of real estate loans and bonds with an attractive pipeline already identified as the manager has sought to capitalise on opportuinities as banks continue to retreat from lending markets.

Liberum View:

n The placing will have a number of benefits for shareholders including increased share liquidity, lower leverage from the preference shares and a reduced total expense ratio (TER). It will also lift the market cap of the company above £100m which should bring it onto the radar of more potential investors.



n The TER saving is significant and is largely attributable to the reduced management fee. We estimate the TER saving will be equivalent to 1.7 percentage points on an annualised basis.



n The current real estate lending environment is very favourable for those with the capital and expertise to fill the funding gap. Traditional bank lenders continue to retreat from the market due to regulatory pressures and increased capital requirements. The deleveraging process has a long way to go and RECI is well placed to capitalise due to the manager's strong market position and access to dealflow.

n RECI trades on a marginal 0.2% discount to NAV (vs. an average 2.7% premium for peers) and it remains our top pick in the sector.

[kenny] 17/10/2013 00:24

Really impressive!

[pejaten] 17/10/2013 00:10

Well that is a massive fund raising! No wonder it took so long to put in place. No dilution for existing shareholders which is great.

[skinny] 16/10/2013 16:49

Summary

· The Company has raised gross proceeds of £50 million by way of a Placing of New Core Shares at the Placing Price.

· The Company intends to utilise the net proceeds of the Placing to invest primarily in debt secured by commercial or residential properties in the United Kingdom and Western Europe which might take the form of (i) secured real estate loans, debentures or any other form of debt instrument and (ii) securitised tranches of secured real estate related debt securities, for example, RMBS and CMBS.


More info in the link.

[davebowler] 11/10/2013 15:34

Via Liberum.

[stupidboypike] 11/10/2013 14:57

davebowler, do you mind me asking how you know?

Best regards SBP

[davebowler] 11/10/2013 14:23

Apparently there has been strong demand for the new placing.

[skinny] 03/10/2013 09:31

Thanks for the updates.

[davebowler] 03/10/2013 09:29

Liberum;
Real Estate Credit Investments (RECI / BUY) - Bond gains highlight NAV upside potential



n 1.8% NAV uplift: NAV per share grew by 1.8% in the second half of September to 155p (15 September: 152p) due to strong performance in the bond portfolio.



n Bond portfolio +2.6%: The bond portfolio rose 2.6% in the month as a result of material repayments and strong m-t-m gains.



n Loan pipeline: Cheyne, the investment manager, has a £150m pipeline of loan opportunities (of which we would expect approximately 25% to be allocated to RECI) with further investments expected in Q4 2013.

Liberum View:

n RECI's bond portfolio continues to deliver consistent returns with a YTD return of +15.2%. This is partially driven by bond sales / repayments above market value and ahead of management's assumed repayment date. RECI has sold £64m of bonds over the past year at an average uplift of 26% over the acquisition price (weighted average sale price of 0.89 vs. cost of 0.70). The total amount of sales is equivalent to 81% of the portfolio market value at the start of the period. There is an additional £20.6m of embedded value in the bond portfolio which is equivalent to 52p per share.

n The pipeline of loan opportunities is encouraging and highlights the manager's ability to access dealflow in the current lending market. This is in direct contrast to recently-listed peers where the pace of investment has been slower than anticipated resulting in downward revisions to year one dividends.



n RECI trades on a 2.6% discount to NAV and the shares offer a prospective 7.2% dividend yield (assuming the proposed placing completes), This compares to a 3.6% premium and 4.0% dividend yield for peers. We regard the 5 point differential in the share rating as unjustified given RECI's superior track record and the combination of attractive income in addition to NAV upside potential.