Please be advised that this announcement is a re-issue of the
one made on 28th August at 10:14hrs. It has been re-issed to
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To:
Company Announcements
Date:
28 August 2015
Company: AXA
Property Trust Limited
Subject:
Net Asset Value 30 June 2015
(Unaudited)
CAPITAL REDEMPTION
- The company paid a capital redemption of £1.8 million on
26 May 2015 and £5.2 million on
30 July 2015, bringing the total
capital returned to Shareholders to £13.1 million.
CORPORATE SUMMARY
- The Company’s unaudited Consolidated Net Asset Value at
30 June 2015 was £49.46 million
(57.73 pence per share), an increase
of £1.87 million (4.17 pence per
share) since 31 March 2015 when the
Consolidated Net Asset Value was £47.60 million (53.56 pence per share);
- The Company and its subsidiaries made a profit after tax of
£8.03 million (9.37 pence per share)
in the twelve month period to 30 June
2015;
MANAGED WIND-DOWN STATUS
- The Company continues to progress the managed wind-down of its
portfolio with a view to realising its investments by December 2015 in a manner that achieves a balance
between maximising the value from the Company's investments and
making timely returns of capital to shareholders.
- The sales of Altenstadt-Lindheim and Kraichtal have been
completed during the quarter.
- Marketing of the properties at Curno and Agnadello was
progressed as part of an Italian portfolio including a third asset
owned by European Added Value Fund S.à.r.l. (a subsidiary of
European Added Value Fund Limited) which is also the Company’s 50%
Joint Venture partner in Agnadello.
- Marketing of Venray and Fuerth is ongoing, while at Dasing and
Rothenburg asset management initiatives are being finalised before
approaching potential purchases.
- Year end 2015 remains the target for the completion of all
sales, however at present it is considered that the completion of
the sale of certain assets may not occur until early 2016.
PORTFOLIO UPDATE
Country Allocation at 30 June 2015
(by value)
Country
% of portfolio
Germany
63%
Italy
30%
Netherlands
7%
Sector Allocation at 30 June 2015
(by value)
Sector
% of portfolio
Retail
55%
Industrial
28%
Leisure
17%
MARKET UPDATE
German Retail
The performance of monthly retail sales support the view that
consumption remains a strong pillar of the German economy as they
continued to increase in May 2015 by
0.5%. One of the main reasons behind the recent rise in retail
sales had been the positive effect of falling oil prices, leading
to enhanced spending on other items. As oil prices are likely
to firm over the coming months, this effect could weaken.
In the first half of 2015, investments in German retail
soared to €9.8bn. Volumes have more than doubled in
comparison to H1 2014. Portfolio sales contributed strongly
to the overall investment volume and were responsible for 65% of
all sales. Also regional centres and second-tier cities have gained
in popularity which reflects the higher risk affinity of investors.
High street investment volumes were boosted by the takeover of 43
Galeria Kaufhof department stores by Canada based Hudson’s Bay Company.
Prime yields have remained flat in all markets with the
exception of Munich and
Hamburg, where yields fell
by 10bps and 9bps respectively. Yields in all German markets are at
their lowest level on record. Prime rents have been flat over the
last quarter in all markets.
Italian Industrial
The take-up of industrial space in Italy in Q2 2015 reached 204,650 sq m, an
increase of almost 250% on the previous quarter and a 1% decrease
on same period of 2014. Quarterly take-up involved existing
buildings and no pre-let transactions have been recorded. With 27%
of quarterly take-up, 3PL operators were once again the most active
occupiers, followed by retailers which are increasingly gaining
influence as a driver of demand. Milan and its environs continued to be the
region with the strongest letting activity. Overall, prime
rents increased in the first quarter to €50/sq m/year in
Milan, up from €48/sq m/year of
the previous quarter, according to CBRE. In the second quarter of
2015, no significant investment transactions have been recorded in
the Logistics sector. Half-yearly volume remained slightly below €
90m.
Netherlands Logistics
In the Netherlands, the
industrial market is continuing to benefit most from the country’s
economic recovery, due to its central location along the European
logistics corridor. The Central and East Brabant and Limburg
regions, which are focused on European distribution and high-tech
sectors, continue to benefit from cheaper rents and good
accessibility to the rest of Europe. Occupiers are actively looking to
relocate to more modern facilities with good accessibility but
overall demand growth looks set to remain weak over the next few
quarters, given the current uncertainty in the Eurozone. Following
strong growth in along the European corridor (up 4.2% in
Rotterdam) in the first quarter,
prime rents have remained stable in the second quarter of 2015 at
€75/sq m/year. The investment market has, however, revived in
the second quarter, with €408m invested into industrial property,
which represents a 8% year-on-year increase. While anticipated
improvement in demand had pushed prime yields down in Q1 2015,
prime yields remained stable in Q2 2015. In Amsterdam and Rotterdam, they now stand at 6%.
CONSOLIDATED PERFORMANCE SUMMARY
|
Unaudited
9 months ended
31 March 2015 |
Unaudited
12 months ended
30 June 2015 |
Quarterly Movement |
|
Pence
per share |
Pence
per share |
Pence
per share /(%) |
Net Asset Value per
share |
53.56 |
57.73 |
4.17
7.8% |
Earnings per
share |
3.84 |
9.37 |
5.53 |
Share price (mid
market) |
43.38 |
44.75 |
1.37
3.2% |
Share price discount
to Net Asset
Value |
19.0% |
22.5% |
3.5
percentage points |
Total Return per
Share |
Unaudited
9 months ended
31 March 2015 |
Unaudited
12 months ended
30 June 2015 |
|
|
Net Asset Value Total
Return |
-1.7% |
-4.0% |
Share Price Total
Return |
|
|
- AXA Property
Trust |
6.1% |
10.5% |
- FTSE All Share
Index |
4.2% |
2.6% |
- FTSE Real Estate
Investment Trust Index |
23.6% |
19.5% |
Source: Datastream; AXA Real Estate
Total net profit was £8.03 million (9.37
pence per share) for the twelve months to 30 June 2015, including £1.53 million of
“revenue” profit (excluding capital items such as revaluation of
property) and £6.49 million “capital” gain, analysed as
follows:
|
Unaudited
9 months ended
31 March 2015 |
Unaudited
3 months ended
30 June 2015 |
Unaudited
12 months ended
30 June 2015 |
|
£million |
£million |
£million |
Net property
income |
3.53 |
1.17 |
4.71 |
Net foreign exchange
(losses) / gains |
(0.36) |
(0.06) |
(0.42) |
Investment Manager's
fees |
(0.33) |
(0.09) |
(0.43) |
Other income and
expenses |
(1.28) |
0.27 |
(1.01) |
Net finance costs |
(1.06) |
(0.26) |
(1.32) |
Revenue
profit |
0.50 |
1.03 |
1.53 |
|
|
|
|
Unrealised (losses) /
gains on revaluation of investment properties |
1.91 |
4.79 |
6.70 |
Net losses on disposal
of investment properties |
- |
(0.71) |
(0.71) |
(loos) / Gain on
disposal of shares in subsidiary |
- |
- |
- |
Net (Losses) / gains
on derivatives |
0.59 |
0.13 |
0.72 |
Share in (losses) /
Profit of Joint Venture |
1.41 |
0.05 |
1.45 |
Finance costs |
(0.46) |
(0.09) |
(0.56) |
Net foreign exchange
losses |
(0.13) |
(0.06) |
(0.19) |
Deferred tax |
(0.40) |
(0.52) |
(0.92) |
Capital
loss |
2.91 |
3.58 |
6.49 |
|
|
- |
|
Total (net loss) /
profit |
3.41 |
4.61 |
8.03 |
NET ASSET VALUE
The Company’s unaudited Consolidated Net Asset Value per share
as at 30 June 2015 was 57.73 pence (53.56
pence as at 31 March 2015), an
increase of 4.17 pence.
The Net Asset Value attributable to the Ordinary Shares is
calculated under International Financial Reporting Standards. It
includes all current year income after the deduction of dividends
paid prior to 30 June 2015.
The £1.87 million increase in Net Asset Value over the quarter
ended 30 June 2015 can be analysed as
follows:
|
Unaudited
9 months ended
31 March 2015 |
Unaudited
3 months ended
30 June 2015 |
Unaudited
12 months ended
30 June 2015 |
|
£million |
£million |
£million |
Opening Net Asset
Value |
50.43 |
47.59 |
50.43 |
Net
(loss) / profit after tax |
3.41 |
4.62 |
8.03 |
Unrealised movement on derivatives |
6.48 |
(6.31) |
0.17 |
Share
Redemption |
(2.00) |
(1.80) |
(3.80) |
Foreign
exchange translation losses |
(10.73) |
5.37 |
(5.36) |
Closing Net Asset
Value |
47.59 |
49.47 |
49.46 |
On a like-for-like basis the Euro valuation of the property
portfolio increased by 6.11% to EUR 95.55
million for the quarter. In Sterling currency terms, the
property valuation was £67.69 million (including the effects of
valuation movements, capital expenditure and foreign exchange
movements). The £/EUR foreign exchange rate applied to the
Company’s Euro investments in its subsidiary companies at
30 June 2015 was 1.41 (31 March 2015: 1.38).
SHARE PRICE AND DISCOUNT TO NET ASSET VALUE
As at close of business on 30 June
2015, the mid market price of the Company’s shares on the
London Stock Exchange was 44.75
pence, representing a discount of 22.5% on the Company’s Net
Asset Value at 30 June 2015.
As at close of business on 27 August
2015, the mid market price of the Company’s shares was also
44.75 pence, representing a discount
of 22.5% on the Company’s Net Asset Value at 30 June 2015.
FUND GEARING
|
Unaudited
31 March 2015
£million /% |
Unaudited
30 June 2015
£million /% |
Movement
£million /% |
Property portfolio
* |
72.01 |
67.76 |
-4.26
6.3% |
Borrowings (net of
capitalised issue costs) |
27.11 |
24.22 |
-2.89
11.9% |
Total gross
gearing |
37.6% |
35.7% |
-1.9
percentage points |
Total net gearing |
30.1% |
23.5% |
-6.6
percentage points |
*Portfolio value based on the Company's independent
valuation
Fund net gearing decreased by 6.6 percentage points over the
quarter to 23.51% as at 30 June
2015.
Fund gearing is included to provide an indication of the overall
indebtedness of the Company and does not relate to any covenant
terms in the Company’s loan facilities. Gross gearing is calculated
as debt over property portfolio at fair value. Net
gearing is calculated as debt less cash over property portfolio at
fair value.
As the wind down progresses, the level of gearing will continue
to decrease as proceeds from sales are used to reduce debt over the
next 6 to 9 months.
LOAN FACILITIES
Gross Loan to Value
(LTV) Covenants |
Unaudited |
Unaudited |
|
|
31
March 2015 |
30 June
2015 |
Maximum |
Main loan
facility |
43.6% |
39.3% |
60.00% |
As at 30 June 2015, the
loan-to-value ratio on the main facility was 39.3% based on the
Company’s independent valuation of the property portfolio.
Interest Cover Ratio
at 30 June 2014 |
Historic |
Minimum |
Projected |
Minimum |
Net
rental income |
|
Unaudited |
|
Unaudited |
|
headroom |
Main loan facility
covenant |
300.2% |
200.0% |
314.8% |
185.00% |
41.2% |
Interest Cover Ratio (ICR) is calculated as net financing
expense payable as a percentage of net rental income less movement
in arrears. Net rental income headroom is based on projected
interest cover.
CASH POSITION AND CAPITAL EXPENDITURE
Of the £8.29 million cash held by the Group including the cash
in the Agnadello JV at 30 June 2015,
£1.5 million was held in bank accounts pledged to the financing
banks.
The anticipated capital expenditure over the next twelve months
is £1.59 million (EUR 2.2
million).
Post-quarter £5.2m were distributed to shareholder on
30 July 2015.
MATERIAL EVENTS
Except for those noted above, the Board of the Company is not
aware of any significant event or transaction which occurred
between 30 June 2015 and the date of
the publication of this Statement which would have a material
impact on the financial position of the Company.
Company website:
http://www.axapropertytrust.com
All Enquiries:
Investment Manager
AXA Investment Managers UK Limited
Broker Services
7 Newgate Street
London EC1A 7NX
Tel: +44 (0)20 7003 2345
Email: broker.services@axa-im.com
Broker
Oriel Securities Limited
Neil Winward / Mark Bloomfield / Matthew Marshall
Tel: +44 (0)20 7710 7600
Company Secretary
Northern Trust International Fund Administration Services
(Guernsey) Limited
Trafalgar Court
Les Banques
St Peter Port
GY1 3QL
Tel: +44 (0)1481 745324