Yew Grove REIT PLC Trading and Covid-19 Update & Dividend Declaration (6531J)

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RNS Number : 6531J

Yew Grove REIT PLC

15 April 2020

Yew Grove REIT plc

(the "Company", the "Group" or "Yew Grove")

Trading and Covid-19 Update

Dividend Declaration

Yew Grove REIT plc, the AIM and Euronext Growth listed regional Irish commercial property investor, today announces its trading update and dividend for the quarter ended 31 March 2020.

Rental collection

Q1 2020 rental collection was robust; Q2 2020 rent, including leases at the recently acquired Millennium Park properties being invoiced for the first time, is being collected in line with expectations and management currently expects that over 95% will be paid on time. The Irish government, FDI and large corporates account for 95.3% of the Group's contracted rental income, the remaining 4.7% of the rent roll comes from SMEs, of which 0.54% is exposed to non-food retail tenants.

Financing

As at 31 March 2020, the Group's net debt stood at EUR32.8 million. After capital commitments, the Group has undrawn loan facilities of EUR8.7 million and cash on deposit of EUR7.5 million, providing significant liquidity headroom totalling EUR16.2 million. In addition, on a pro-forma basis the Group's portfolio (excluding unfettered properties) would need to fall in value by around EUR46 million, or 37%, for the LTV covenants in the Group's borrowing arrangements to come under risk of being breached. Similarly, rental income on these assets would need to fall by 56% for the interest coverage covenant to come under risk of being breached.

Debt metrics

 
                            31 March 2020     Covenant 
 Facility Loan to Value          32%            50% 
                          -----------------  --------- 
 Facility Interest 
  coverage (forward)            6.96x          3.25x 
                          -----------------  --------- 
 Facility Interest 
  coverage (historical)         12.59x         3.25x 
                          -----------------  --------- 
 REIT Cost Cover                2.48x          1.60x 
                          -----------------  --------- 
 Debt Maturity              December 2021 
                          ----------------- 
 Debt maturity with         December 2022 
  extension 
                          ----------------- 
 Total facility size       EUR49.1 million 
                          ----------------- 
 Undrawn facility           EUR8.7 million 
                          ----------------- 
 Unfettered assets         EUR11.98 million 
                          ----------------- 
 

Dividend

On 14 April 2020, the Board of Directors approved the payment of the Company's first quarterly interim dividend in an amount of 1.20 cents per ordinary share which will be paid (or CREST accounts credited) on 6 May 2020 to shareholders who are on the share register at the close of business on 24 April 2020, with a corresponding ex-dividend date of 23 April 2020. The dividend will comprise a Property Income Distribution ("PID") of 1.20 cents per share. This dividend is covered by Q1 2020 EPRA earnings. Further dividend payments are expected for the next three quarters of 2020.

Investment and development pipeline

Yew Grove has a substantial pipeline of potential acquisitions, but none have reached the point of legal exchange. All acquisition activity has now been paused until the Company has greater clarity on the likely effect of the Covid-19 pandemic on our market.

Outlook

The economic effect of the Covid-19 crisis is still in its early stages with much of Ireland in self-isolation and many office-based occupiers working remotely. It is too early to say how the developments over the next few months will play out in the Irish commercial real estate market. At present the industrial sector, especially that part involved in the med tech sector and the pharmaceutical supply chain looks robust. In offices, given Ireland's structural shortage of properties suitable for FDIs and large corporates, especially in the markets served by Yew Grove, the longer-term outlook remains much as it was and is expected to be resilient provided the virus does not cause a deep and more prolonged global downturn.

Jonathan Laredo, Chief Executive Officer, commented:

"Yew Grove was financially well positioned coming into this crisis. The Company has a strong balance sheet and sufficient liquidity to see it through and beyond the likely term of government mandated quarantines. Our portfolio is over 89% let, with the vast majority of our tenants either in businesses that are insulated from, or well able to get through, the effects of government actions to control the spread of contagion. Because of that, our focus has been on working with tenants and occupiers to keep their buildings safe, to understand the business stresses they currently face and to try to ameliorate them where we are able. We continue to monitor opportunities and will look to re-enter the markets when it is sensible to do so.

"The crisis has increased unemployment and reduced income for a large number of people while at the same time Irish charities that support those facing hardship have seen their ability to raise funds severely impacted. As one of the businesses which is still functioning we have a social responsibility and I am pleased to say that both the Company and members of the Yew Grove team are making contributions to help support the charitable effort to alleviate hardship."

For further information contact:

 
 Yew Grove REIT plc                           [phone] 
 Jonathan Laredo, Chief Executive Officer 
                                             ---------------------------------- 
 Charles Peach, Chief Financial Officer 
                                             ---------------------------------- 
 Michael Gibbons, Chief Investment Officer 
                                             ---------------------------------- 
 
 Goodbody Stockbrokers UC                     [phone] 
                                             ---------------------------------- 
 Joint Broker & Euronext Growth Advisor 
                                             ---------------------------------- 
 David Kearney, John Flynn, Edel O'Reilly, 
  Ronan Bransfield 
                                             ---------------------------------- 
 
 Liberum Capital Limited 
                                             ---------------------------------- 
 Joint Broker & Nomad                         [phone] 
                                             ---------------------------------- 
 Richard Crawley, Jamie Richards, Jonathan 
  Wilkes-Green 
                                             ---------------------------------- 
 
 IFC Advisory                                 [phone] 
                                             ---------------------------------- 
 Financial PR                                 [e-mail] 
                                             ---------------------------------- 
 Tim Metcalfe, Graham Herring 
                                             ---------------------------------- 
 

Forward-looking Statements

Certain information contained in this announcement may constitute forward looking information. This information relates to future events or occurrences or the Company's future performance. All information other than information of historical fact is forward looking information. The use of any of the words "anticipate", "plan", "continue", "estimate", "expect", "may", "will", "project", "should", "believe", "predict" and "potential" and similar expressions are intended to identify forward looking information. This information involves known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking information. No assurance can be given that this information will prove to be correct and such forward looking information included in this announcement should not be relied upon. Forward-looking information speaks only as of the date of this announcement. The forward-looking information included in this announcement is expressly qualified by this cautionary statement and is made as of the date of this announcement. The Company and its Group does not undertake any obligation to publicly update or revise any forward-looking information except as required by applicable securities laws.

Notes to editors

Yew Grove REIT plc, quoted on the London Stock Exchange's AIM market and on the Euronext Growth Market in Dublin, is an Irish commercial real estate company invested in a diversified portfolio of Irish commercial property. Yew Grove has a particular focus on well-tenanted commercial real estate assets comprising of office and industrial assets outside of Dublin's Central Business District.

Yew Grove's highly experienced team has a proven track record in commercial property investment and asset management in Ireland and internationally and is focused on delivering results. Its investment approach is strategic, not speculative, principally on assets that are let, pre-let or to be let after refurbishment. Shareholders are provided with stable, long-term income from a diverse portfolio of commercial property comprising well-tenanted real estate in strategic centres let to Irish government entities and other state bodies, IDA Ireland supported and other FDI companies, and larger corporates.

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April 15, 2020 02:00 ET (06:00 GMT)