Regional Reit Share Discussion Threads

[hpcg] 26/3/2024 10:16

"Significant preparatory work has been undertaken to date in respect of both the debt and equity refinancing options".

And more extensively from the annual report

"As previously mentioned,the maturity of the £50m 4.5% Retail Eligible Bond in August 2024, has been a particular focus of the Board. The most appropriate refinancing option is still subject to commercial and practical considerations, though significant preparatory work has been undertaken to date in respect of both the debt and equity options, which remain under active consideration."

Section 29.7 In the annual report "Liquidity Risk" they have £94m of outgoings to fund in 2024: the retail bond, £20mn of bank debt to repay and £31m to trade creditors, with £8mn on the positive side for interest rate derivatives and in a table above £9mn of receivables. The net bank repayments made in 2023 account for the reduction in cash over the period. £6mn of the payables was for the dividend announced but not paid.

[nickrl] 26/3/2024 09:38

@Feddie rent roll is down another 4m at year end vacancies are up so ongoing expenses up over 3m on previous year the only positive is the inv mgt fee is down a fair whack which helps them just keep divi covered going forward. However, net cash is down 15m to 35m and how much of that could be set a side for the bond im not sure but probably no more than 20m. So im surmising its Plan A a race to complete property sales or Plan B raise some additional cash. Why they just didn't cull the dividend for 2-4qtrs is beyond me and surely a city scribbler will ask that.

[feddie] 26/3/2024 09:09

All in million

1. Revenue: 91.9
2. Property costs: (38.2)
3. Administration: (10.6)
4. Finance costs: (16.2)

FFO (1-(2+3+4)): 26.9
Forward looking dividends: 24.8

Dividends are covered. If cut, they would go a long way to reducing debt.

[williamcooper104] 26/3/2024 08:40

Yes - let's pay a divi > than op cashflow And then do a rights issue That's the way to do it :)

[arbus5000] 26/3/2024 08:01

it was mentioned before, but its still true now: there's a lot of weak minded people on this thread.

[dartboard1] 26/3/2024 07:54

Operating cash flow 22m. Dividends paid 32m. How long can that continue

[feuille] 26/3/2024 07:45

Because you're wrong ? Ever crossed your mind ?

[spectoacc] 26/3/2024 07:42

How can there not be a RI accompanying these results - must be having trouble getting it away.

[grahamg8] 26/3/2024 07:32

Some weeks ago I posted that there was probably value in RGL but they would effectively need to go into wind down in order to pay off all the borrowing on time. That calculation was based on £150m disposals in 2024, so good so far. Unfortunately for shareholders it would also mean £150m in 2025 and again in 2026. I still don't see an investment case for the shares (at anything much above 10pps considering the risks v rewards outcome), but the bonds are looking a bit more secure.

[rcturner2] 26/3/2024 07:15

The current disposal programme comprises of 58 assets totalling c £130m:

· one disposal contracted for £405,000;

· 10 disposals totalling c. £22 million under offer and in legal due diligence;

· 9 further disposals totalling c. £20 million are in negotiation;

· 24 further disposals totalling c. £42 million are on the market; and

· 14 potential disposals totalling c. £46 million are being prepared for the market

[hindsight] 19/3/2024 09:40

Yep Spectoacc, ink on RI document dried a long time ago, only bit blank is the price and that is finding the sweat spot for underwriting fee /resemblance of reputation
10p still my thinking and will probably take that on my bonds if shareholders dont take full allocations

[cc2014] 19/3/2024 07:32

I'm not sure Specto. The bounce to 17.5p seems too high to me. On the other hand the pricing of the retail bond suggest the RI is going to be successful too.

I begin to wonder if the bounce is short closing combined with some bottom pickers who maybe think there is room for a bid at 25p.

[spectoacc] 19/3/2024 06:56

The bounce implies the RI is nearly ready IMO - major shareholders all over the wall.

[ih_431051] 18/3/2024 19:40

"significant preparatory work has been undertaken to date in respect of both the debt and equity options, which remain under active consideration."

Perhaps a convertible then lol, so the lender can convert n dump the shares at a later date to cover risk - maybe not a bad deal if at the CRE nadir

Anyway, a technical base is forming.. it'll cross the exit line soon

[tiltonboy] 18/3/2024 18:19

Maybe there isn't a RI

[tradez4dayz] 18/3/2024 18:05

Price seems to have bounced back somewhat? I don't really get it due to the rights issue

[lpavlou] 14/3/2024 20:22

Retail bonds rank higher than equity. If they don't repay them, they will be in default and this default may even cause a default on their bank debt. Can't see retail bond holders exchanging current bonds for new bonds at higher rates as they will be trade below par almost immediately. Sales will help, but half that money has to go to repay bank debt and timing is difficult to predict. A large equity raise is the best option but will dilute everyone if it's not an open offer. There are a large number of PE funds which would have a go here at the right price.

[williamcooper104] 14/3/2024 10:49

I think all the assets, or almost all, are encumbered

[cc2014] 14/3/2024 10:47

Apart from the short term financing issues the long terms ones look no better

If the bonds are not repaid then:
retail bond resets at around 15%. Costs an extra 5m in interest
other bonds reset at around 10%. Costs an extra £25.5m in interest And the 10% presupposes interest base rate has fallen when the renegotiation takes place.


Whatever RGL manages to do to get through the retail re-fi the RBS facility of £128m is due in Aug 26 so under normal terms of business that would be sorted in about Aug 25

[nickrl] 14/3/2024 10:03

@arbus i believe some of the cash is locked up in restricted accounts so how much can be ring fenced for the bond isn't clear. Are the assets their selling unencumbered? They don't tell us.

[arbus5000] 14/3/2024 07:22

back of the envelope calculations suggests that less than £25m is needed for the bond, and the remainder will be used to further lower LTV / fund capex.

[rcturner2] 14/3/2024 07:15

The figure of £75m doesn't come from RGL, but of course anything is possible, so it may well be at that level.