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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Reg Reit Zdp | LSE:RGLZ | London | Ordinary Share | GB00BH4TCL65 | ZDP SHS 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 130.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From Apr 2019 to Apr 2024
TIDMRGLZ
RNS Number : 6933Q
Regional REIT ZDP PLC
14 September 2017
Regional REIT ZDP PLC
Interim Report for the nine months ended 30 June 2017 (Unaudited)
MANAGEMENT REPORT
Regional REIT ZDP PLC (the "Company"), was incorporated on 28 November 2013 and is registered in England and Wales. The Company is a wholly-owned subsidiary of Regional Commercial Midco Limited ("Midco"), a company incorporated in Jersey, which in turn is a wholly-owned subsidiary of Regional REIT Limited (the "Group"), a Guernsey incorporated company. The Company has been engaged in the single economic activity of raising funds in order to provide financing to the Group.
On 24 March 2017, Midco acquired all of the issued ordinary shares in the Company and the Group assumed the Contribution Agreement to meet the financial obligations of the Company, including the ZDP Shares. The Contribution Agreement was novated from The Conygar Investment Company PLC to Midco. The Contribution Agreement with Midco provides an undertaking for the Group to pay any costs and expenses incurred by the Company and to enable the Company to meet its payment obligations in respect of the ZDP Shares. Although Midco has entered into an undertaking to meet all of the Company's liabilities as they fall due, it is important to note that all risks are borne by the ZDP Shareholders who are not guaranteed to receive their full ZDP Capital Entitlement.
On 24 March 2017, the Company also extended its accounting reference date from 30 September to 31 December to match the reporting dates of the Group. It is as a result of this change of accounting date that the Company is preparing and releasing this interim report for the nine months ended 30 June 2017.
The Company has a capital structure comprising unlisted ordinary shares and the zero dividend preference shares ("ZDP Shares") listed on the Official List and traded on the London Stock Exchange by way of a standard listing.
On 24 March 2017, Robert Ware, Nigel Hamway and Ross McCaskill each resigned as Directors. Following their resignations William Eason, Martin McKay and Stephen Inglis were appointed as Non-Executive Directors. On the same date, Ross McCaskill also resigned as Company Secretary and Capita Company Secretarial Services Limited were appointed as Company Secretary. RSM UK Audit LLP replaced Rees Pollock as the appointed auditors of the Company. Martin McKay subsequently resigned as a Non-Executive Director, on 7 July 2017, and Tim Bee was appointed in his stead.
The Company's principal investment objective is to provide the holders of the ZDP Shares with a predetermined final capital entitlement ("ZDP Capital Entitlement"). The Company was incorporated to be the issuer of the ZDP Shares, which are quoted on the London Stock Exchange (LSE: RGLZ).
On the scheduled repayment date, 9 January 2019, the ZDP Shareholders are entitled to receive a final capital entitlement of 132.9 pence per ZDP Share. This is an amount equal to 100 pence per share increased daily at an equivalent annual rate of 5.5% for the period 10 January 2014 to 23 March 2017; for the period 24 March 2017 until 9 January 2019, the ZDP Share equivalent annual rate is 6.5% per annum.
The Company will fulfil its investment objective through the Contribution Agreement it has with Midco and the Group will provide support to the Company in respect of the capital entitlement of the ZDP shareholders.
The principal risk the Company faces is that Midco will not have sufficient resources to meet the capital entitlement due to the ZDP shareholders. Other risks faced by the Company are considered to be the same as for the Group and these are defined in detail on pages 46 to 48 of the Regional REIT Limited Annual Report and Accounts 2016, which is available on the Group's website at www.regionalreit.com - Annual Report 2016.
The Directors believe that the Company is well placed to manage its business risks and also believe that the Group will have sufficient resources to continue in operational existence for the foreseeable future. Accordingly, they have prepared this Interim Report on the going concern basis.
Position of the Company and Group covenants as at 30 June 2017
As at 30 June 2017, the Company maintained a positive position and the financing arrangements were performing as envisaged in the listing prospectus of January 2014. The Group comfortably met all of the conditions and obligations under the various arrangements. These conditions are tested quarterly and no breaches have occurred at any point since incorporation. The definitions and conditions of issue are set out in the listing prospectus, a copy of which is available on the Group's website at www.regionalreit.com.
As at 30 June 2017, the two primary Group covenants were:
1. Cover Test (not less than 3.5x) - Test Met
Cover Test: Means the ratio of the Net Asset Value plus the accrued Capital Entitlement to the ZDP Capital Entitlement must not be less than 3.5 times.
2. Investment Property Cover Test (not less than 2.5x) - Test Met
Investment Property Cover Test: Means the ratio of the aggregate value of the Group's investment properties plus cash and cash equivalents of any marketable securities to the ZDP Capital Entitlement must not be less than 2.5 times.
RESPONSIBILITY STATEMENT
The Directors confirm to the best of their knowledge that:
-- this condensed set of financial statements has been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union, as required by the Disclosure Guidance and Transparency Rule DTR4.2.4R, and gives a true and fair view of the assets, liabilities, financial position and loss of the Company; and
-- this Interim Report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules; being an indication of important events that have occurred during the first nine months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the financial year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules; being related party transactions that have taken place in the first nine months of the current financial year that have materially affected the financial position or performance of the Company during that period; and any changes in the related party transactions described in the last annual report that could do so.
This Interim Report was approved by the Board of Directors on 13 September 2017 and the above responsibility statement was signed on its behalf by Mr William D Eason, Chairman.
Unaudited Condensed Statement of Comprehensive Income
For the nine months ended 30 June 2017
Hot Features
Premium
Nine months Nine months Year
ended ended ended
30 June 30 June 30 September
2017 2016 2016
Note GBP'000 GBP'000 GBP'000
Administrative expenses 3 (42) (22) (22)
------------ ------------ --------------
Operating loss (42) (22) (22)
Finance costs 4 (1,615) (1,447) (1,944)
------------ ------------ --------------
Loss before taxation (1,657) (1,469) (1,966)
Taxation - - -
------------ ------------ --------------
Total comprehensive
loss for the period (1,657) (1,469) (1,966)
============ ============ ==============
Basic and diluted
earnings per share 7 (3,314)p (2,938)p (3,932)p
============ ============ ==============
All of the activities of the Company are classed as continuing.
Unaudited Condensed Statement of Financial Position
As at 30 June 2017
30 June 30 June 30 September
2017 2016 2016
Note GBP'000 GBP'000 GBP'000
Non-current assets
Amounts due from Midco 5 36,099 33,968 34,465
---------- ---------- ---------------
Total assets 36,099 33,968 34,465
Current liabilities
Accrued administrative (19) - -
costs
Non-current liabilities
Zero dividend preference
shares 6 (36,030) (33,918) (34,415)
Total liabilities (36,049) (33,918) (34,415)
Net assets 50 50 50
========== ========== ===============
Equity
Share capital 8 50 50 50
Capital contribution 6,790 4,636 5,133
Retained earnings (6,790) (4,636) (5,133)
---------- ---------- ---------------
Total equity 50 50 50
========== ========== ===============
The unaudited condensed financial statements were approved by the Board and authorised for issue on 13 September 2017 and signed on its behalf by Mr William D Eason, Chairman.
Unaudited Condensed Statement of Changes in Equity
For the nine months ended 30 June 2017
Share Capital Retained
Capital Contribution Earnings Total
GBP'000 GBP'000 GBP'000 GBP'000
Balance as at 1 October
2016 50 5,133 (5,133) 50
Total comprehensive
loss for the period - - (1,657) (1,657)
Contribution by Midco - 1,657 - 1,657
Balance as at 30 June
2017 50 6,790 (6,790) 50
For the nine months ended
30 June 2016
Balance as at 1 October
2015 50 3,167 (3,167) 50
Total comprehensive
loss for the period - - (1,469) (1,469)
Contribution by Midco - 1,469 - 1,469
Balance as at 30 June
2016 50 4,636 (4,636) 50
For the year ended 30
September 2016
Balance as at 1 October
2015 50 3,167 (3,167) 50
Total comprehensive
loss for the year - - (1,966) (1,966)
Contribution by Midco - 1,966 - 1,966
Balance as at 30 September
2016 50 5,133 (5,133) 50
========= ============== ========== ========
Notes to the Unaudited Condensed Financial Statements
For the nine months ended 30 June 2017
1. General information
The Company was incorporated on 28 November 2013 and is registered in England and Wales. The Company is a wholly-owned subsidiary of Midco.
The financial information contained in this Interim Report does not constitute statutory financial statements as defined in Section 434 of the Companies Act 2006.
The Company has extended its accounting reference date from September 30 to December 31, to match the reporting dates of the Group. As a result of this change the unaudited condensed financial statements are prepared for the nine month period from 1 October 2016 to 30 June 2017. This Interim Report has not been reviewed by the Company's Auditors.
2. Significant accounting policies
Basis of preparation
The financial statements have been prepared in accordance with IAS 34, 'Interim Financial Reporting'. They do not include all of the information required for full annual financial statements and should be read in conjunction with the Company's 2016 Annual Report. The accounting policies applied by the Company in the Interim Report are the same as those that have been applied to the 2016 annual financial statements.
The annual financial statements of the Company are prepared in accordance with International Financial Reporting Standards ('IFRS') as issued by the IASB.
The comparative figures for the financial year ended 30 September 2016 are not the Company's statutory accounts for that financial year in accordance with section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Register of Companies. Those accounts have been reported on by the company's auditors and delivered to the registrar of companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
Segmental reporting
The Directors are of the opinion that the Company is engaged in a single economic and geographic segment of business primarily being the raising of funds in order to provide financing to the Group.
Statement of cash flows
No cash flow statement is presented as all funding activities are provided by the Group.
3. Administrative expenses
Nine months Nine months Year
ended ended ended
30 June 30 June 30 September
2017 2016 2016
GBP'000 GBP'000 GBP'000
Costs of meeting regulatory
obligations 42 22 22
============ ============ ==============
4. Finance costs
Nine months Nine months Year
ended ended ended
30 June 30 June 30 September
2017 2016 2016
GBP'000 GBP'000 GBP'000
Interest on ZDP
Shares 1,515 1,347 1,810
Amortisation of
issue costs 100 100 134
------------ ------------ --------------
1,615 1,447 1,944
============ ============ ==============
5. Amounts due from Midco
Nine months Nine months Year
ended ended ended
30 June 30 June 30 September
2017 2016 2016
GBP'000 GBP'000 GBP'000
Balance at start of
period 34,465 32,521 32,521
Loan repaid by Midco (23) (22) (28)
Additions under contribution
agreements 1,657 1,469 1,972
------------ ------------ --------------
Balance at end of period 36,099 33,968 34,465
============ ============ ==============
Funds raised through the ZDP Share issue, after the deduction of issue costs of GBP668,286, totalled GBP29,331,714. The funds were transferred to The Conygar Investment Company PLC as a non-interest bearing loan repayable on demand in accordance with the Loan Agreement dated 7 January 2014. The Loan Agreement was novated to Midco on 24 March 2017.
The Contribution Agreement entered into by the Company and The Conygar Investment Company PLC on 7 January 2014, was novated to Midco on 24 March 2017. The agreement provides an undertaking by the Group to pay any costs and expenses incurred by the Company in respect of its operation and the continuation of its business and to enable the Company to meet its payment obligations in respect of the ZDP Shares. The Group has agreed to support the Company's obligations and has agreed to certain protections to ensure the Group does not make distributions or returns of capital without retaining sufficient capital to meet its obligations to the Company.
6. Zero dividend preference shares
Nine months Nine months Year
ended ended ended
30 June 30 June 30 September
2017 2016 2016
GBP'000 GBP'000 GBP'000
Balance at start of
period 34,415 32,471 32,471
Amortisation of issue
costs 100 100 134
Accrued capital 1,515 1,347 1,810
------------ ------------ --------------
Balance at end of period 36,030 33,918 34,415
============ ============ ==============
On 10 January 2014, the Company issued 30,000,000 ZDP Shares at GBP0.01 each per share. The ZDP Shares have an entitlement to receive a fixed cash amount on the maturity date of 9 January 2019, but do not receive any dividends or income distributions. Additional capital accrues to the ZDP Shares on a daily basis at a rate equivalent to 6.5% per annum post acquisition, 5.5% per annum pre-acquisition, resulting in a final capital entitlement of 132.9 pence per share. The ZDP Shares were listed on the London Stock Exchange on 10 January 2014.
During the nine months, the Company has accrued for GBP1,515,000 (nine months to 30 June 2016: GBP1,347,000; year ended 30 September 2016: GBP1,810,000) of additional capital. The total amount repayable at maturity will be GBP39,879,269.
The ZDP Shares do not carry the right to vote at general meetings of the Company, although they carry the right to vote as a class on certain proposals which would be likely to materially affect their position. In the event of a winding-up of the Company, the capital entitlement of the ZDP Shares (except for any undistributed revenue profits) will rank ahead of ordinary shares but behind other creditors of the Company.
7. Earnings per share
The calculation of earnings per share is based on a loss after tax figure for the period of GBP1,657,000 (nine months to 30 June 2016: GBP1,469,000; year ended 30 September 2016: GBP1,966,000) and the weighted average number of 50,000 ordinary shares (nine months to 30 June 2016: 50,000; year ended 30 September 2016: 50,000) in issue during the period. The basic and diluted earnings per share are the same.
8. Share capital
The Company has 50,000 ordinary shares in issue of GBP1.00 each.
9. Controlling and related parties
The Company is a wholly-owned subsidiary of Midco, which itself is a wholly-owned subsidiary of Regional REIT Limited, which is the ultimate controlling party.
The Company entered into a non-interest bearing loan agreement with The Conygar Investment Company PLC on 7 January 2014. The obligations under that agreement were novated to Midco on 24 March 2017. As at 30 June 2017, the Group owed GBP36,030,000 (30 June 2016: GBP33,918,000; 30 September 2016: GBP34,415,000) to the Company under the loan agreement.
As at 30 June 2017, the ZDP Shareholders were owed GBP36,235,000, including issue costs to be amortised amounting to GBP205,000 (30 June 2016: GBP34,256,000 and GBP338,000; 30 September 2016: GBP34,719,000 and GBP304,000).
The Directors received no remuneration for their services to the Company during the period.
10. Events after the reporting date
On 7 July 2017, Martin McKay stepped down as a Non-Executive Director of the Company and Tim Bee was appointed in his stead.
Directors and Advisers
Directors William Eason (Chairman) (appointed
24 March 2017)
Stephen Inglis (Non-Executive Director)
(appointed 24 March 2017)
Tim Bee (Non-Executive Director) (appointed
7 July 2017
Martin McKay (Non-Executive Director)
(appointed 24 March 2017,
resigned 7 July 2017)
Secretary Capita Company Secretarial Services
Limited
Registered Office Beaufort House
51 New North Road
Exeter
EX4 4EP
Registrar Share Registrars Limited
The Courtyard
17 West Street
Farnham
Surrey
GU9 7DR
Financial Adviser Peel Hunt LLP
& Broker
Moor House
120 London Wall
London
EC2Y 5ET
Legal Adviser Macfarlanes LLP
to the
Company 20 Cursitor Street
London
EC4A 1LT
Auditors RSM UK Audit LLP (appointed 24 March
2017)
25 Farringdon Street
London
EC4A 4AB
Company Information
Financial Calendar
Company year-end December
Annual Results March
announced
Annual General May
Meeting
Interim results September
announced
ESMA Legal Entity 5493008P27MNKQPREM26
Identifier ("LEI")
Zero Dividend Preference Shares
The Company's ZDP Shares are listed on the London Stock Exchange. Information about the Company can be obtained on the Parent's website: http://www.regionalreit.com
ISIN GB00BH4TCL65 Sedol BH4TCL6 Ticker RGLZ Company Registration No: 08794437
Share registrar enquires:
The register for the ZDP Shares is maintained by Share Registrars Limited. In the event of queries regarding your holding, please contact the Registrar on 01252 821390. Changes of name and/or address must be notified in writing to the Registrar.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SFEFUDFWSESU
(END) Dow Jones Newswires
September 14, 2017 02:01 ET (06:01 GMT)
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