Standard LifeInvProp Net Asset Value
May 11 2016 - 2:00AM
UK Regulatory
TIDMSLI
11 May 2016
STANDARD LIFE INVESTMENTS PROPERTY INCOME TRUST LIMITED (LSE: SLI)
Unaudited Net Asset Value as at 31 March 2016
Key Highlights
* Net asset value per ordinary share was 82.3p as at 31 March 2016, an
increase of 0.1% from 31 December 2015 resulting in a NAV total return of
1.5% for Q1;
* The portfolio increased by 0.1% on a like for like basis which compares
favourably to the quarterly capital return on the monthly IPD Monthly Index
capital return over the quarter (fall of 0.2%);
* The increase in stamp duty land tax announced in the March 2016 budget
resulted in a GBP3.5 million reduction in valuations across the portfolio;
excluding this the portfolio showed a like for like increase of 0.8%;
* On 28 April 2016, the Company announced a debt refinancing resulting in a
new seven year term loan facility of GBP110 million and a revolving credit
facility of GBP35 million at a current blended rate of interest of 2.5%, and
a LTV of 29.5%;
* Share price total return of 2.2% over the quarter as the Company's shares
continue to trade at a premium to NAV. This return compares favourably to
the total return on both the FTSE All-Share Index (-0.4%) and the FTSE REIT
Index (-5.7%);
* Based on new dividend rate of 1.19p per quarter, dividend yield of 5.5%
based on share price of 86.25p (31 March 2016) comparing favourably to the
yield on the FTSE All-Share REIT Index (3.3%) and the FTSE All Share Index
(3.8%) as at the same date.
Net Asset Value ("NAV")
The unaudited net asset value per ordinary share of Standard Life Investments
Property Income Trust Limited ("SLIPIT") at 31 March 2016 was 82.3p. The net
asset value is calculated under International Financial Reporting Standards
("IFRS").
The net asset value incorporates the external portfolio valuation by Jones Lang
LaSalle and Knight Frank at 31 March 2016.
Breakdown of NAV movement
Set out below is a breakdown of the change to the unaudited NAV per share
calculated under IFRS over the period 31 December 2015 to 31 March 2016.
Per Share (p) Attributable Comment
Assets (GBPm)
Net assets as at 1 January 82.2 312.8
2016
Unrealised increase in 0.1 0.3 Like for like increase of
valuation of property 0.1% in property portfolio
portfolio
Net income in the quarter 0.4 1.6 Strong net income in the
after dividend quarter as full quarters
rent from Dec 15 portfolio
acquisition included but
dividend paid in quarter
related mainly to
pre-acquisition
shareholders
Interest rate swaps mark to -0.3 -0.9 Increase in swap
market revaluation liabilities as a result of
a decrease in the
expectation for future
interest rates
Other movement in reserves -0.1 -0.5 Movement in lease
incentives and capital
expenditure in the quarter
Net assets as at 31 March 82.3 313.3
2016
31 Mar 2016 31 Dec 2015
European Public Real Estate Association
("EPRA")*
EPRA Net Asset Value GBP316.3m GBP314.9m
EPRA Net Asset Value per share 83.1p 82.8p
The Net Asset Value per share is calculated using 380,690,419 shares of 1p each
being the number in issue on 31 March 2016.
* The EPRA net asset value measure is to highlight the fair value of net assets
on an on-going, long-term basis. Assets and liabilities that are not expected
to crystallise in normal circumstances, such as the fair value of financial
derivatives, are therefore excluded.
Investment Manager Commentary
The first quarter of 2016 felt very different to the last half of 2015. The
"Brexit" debate has come to centre stage, the low oil price has cut confidence
and dividends and the combination of all these factors has resulted in stock
market volatility. The Chancellor then added further pressure to the real
estate market in the budget with a 1% increase in Stamp Duty Land Tax ("SDLT")
for larger commercial properties.
Despite this challenging environment tenant activity has remained robust. We
have seen continued demand from occupiers on vacant space and have undertaken a
number of successful asset management initiatives in the quarter as follows:
* Letting of three vacant units at Budbrooke industrial estate, Warwick
adding GBP92k in rent per annum after incentives;
* Successful lease regear at Broadoak, Manchester, one of the assets acquired
in December as part of the portfolio acquisition, with solicitors
instructed on two further regears at the same investment
* Rent review completed at Denby, above ERV and adding an additional GBP170k in
rent.
Overall voids have increased slightly to 3.7% due to an expiry at the end of
the quarter on an industrial unit in Oldham with the other large void being an
industrial unit in Bristol which is currently being refurbished.
Although uncertainty will remain elevated until the second half of the year we
remain optimistic that tenant demand for smaller buildings outside Central
London will remain robust and that income will continue to dominate total
return.
Cash position
As at 31 March 2016 the Company had cash of GBP14.1 million.
Dividends
The Company paid total dividends in respect of the quarter ended 31 December
2015 of 1.161p per Ordinary Share, with a payment date of 31 March 2016. As
previously announced the first interim dividend for 2016 will be 1.19p per
Ordinary share, an increase of 2.5%.
Net Asset analysis as at 31 March 2016 (unaudited)
GBPm % of net
assets
Office 163.7 52.3
Retail 100.8 32.2
Industrial 187.8 59.9
Total Property Portfolio 452.3 144.4
Adjustment for lease (3.5) (1.1)
incentives
Fair value of Property 448.8 143.3
Portfolio
Cash 14.1 4.5
Other Assets 6.0 1.9
Total Assets 468.9 149.7
Non-current liabilities (142.1) (45.4)
Current liabilities (13.5) (4.3)
Total Net Assets 313.3 100.0
Breakdown in valuation movements over the period 1 Jan 16 to 31 Mar 2016
Portfolio Exposure as Like for Capital
Value as at at 31 Mar Like Value Shift
31 Mar 2016 2016 (%) Capital (GBPm)
(GBPm) Value Shift
(%)
Valuation as of 31 452.0
Dec 2015
Retail 100.8 22.3 0.0 0.0
South East Retail 6.8 1.9 0.6
Rest of UK Retail 1.1 -1.0 -0.1
Retail Warehouses 14.4 -0.8 -0.5
Offices 163.7 36.2 -0.2 -0.4
London City Offices 4.7 -0.7 -0.2
London West End 2.4 -0.9 -0.1
Offices
South East Offices 23.5 -0.1 -0.1
Rest of UK Offices 5.6 -0.1 0.0
Industrial 187.8 41.5 0.4 0.7
South East Industrial 11.3 -0.6 -0.3
Rest of UK Industrial 30.2 0.7 1.0
External valuation at 452.3 100.0 0.1 452.3
31 Mar 2016
Top 10 Properties
31 Mar 16 (GBPm)
White Bear Yard, London 20-25
Elstree Tower, Borehamwood 15-20
Denby 242, Denby 15-20
DSG, Preston 15-20
Symphony, Rotherham 15-20
Chester House, Farnborough 15-20
Charter Court, Slough 10-15
3B - C Michigan Drive, Milton Keynes 10-15
Ocean Trade Centre, Aberdeen 10-15
Bourne House, Staines 10-15
The Board is not aware of any other significant events or transactions which
have occurred between 31 March 2016 and the date of publication of this
statement which would have a material impact on the financial position of the
Company.
Details of the Company may also be found on the Investment Manager's website
which can be found at: www.standardlifeinvestments.com/its
For further information:-
Jason Baggaley - Real Estate Fund Manager Standard Life Investments
Tel +44 (0) 131 245 2833 or jason_baggaley@standardlife.com
The Company Secretary
Northern Trust International Fund Administration Services (Guernsey) Ltd
Trafalgar Court
Les Banques
St Peter Port
GY1 3QL
Tel: 01481 745001
Fax: 01481 745085
END
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