Net Asset Value • Jan 28, 2013
Net Asset Value
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RNS Number : 4354W
Picton Property Income Limited
28 January 2013
28 January 2013
PICTON PROPERTY INCOME LIMITED
("Picton" or the "Company" or the "Group")
Net Asset Value as at 31 December 2012,
Interim Dividend and Interim Management Statement
Picton Property Income Limited (LSE: PCTN) announces its Net Asset Value as at 31 December 2012 and Interim Dividend.
Quarterly Highlights
· Net Assets of £174.5 million (30 September 2012: £180.2 million)
· NAV/EPRA NAV per share of 51 pence (30 September 2012: 52 pence)
- 1.4% decrease in underlying property portfolio valuation (30 September 2012: -1.3%)
· Debt reduction of £8.9 million, through amortisation and ZDP refinancing
· Improvement in net rental income through letting activity equivalent to £0.3 million per annum
· Appointment of non executive director and investment director in January 2013
· Dividend of 0.75 pence declared (30 September 2012: 0.75 pence)
Commenting, Nick Thompson, Chairman of Picton, said:
"During the quarter we concluded our refinancing and now have a staggered long term debt profile with on-going amortisation. We have operated with a covered dividend and have also been able to grow income through leasing activity. We can report an encouraging level of activity across the portfolio as we implement various asset management initiatives, with a particular focus on letting space in central London where values continue to improve.
In addition, we have strengthened the team with the appointment of a replacement non executive director, and also an investment director within Picton Capital, which will provide further focus at a portfolio level."
NET ASSET VALUE
The unaudited Net Asset Value ('NAV') of Picton, as at 31 December 2012, was £174.5 million, reflecting approximately 51 pence per share, a decrease of 3.2% over the quarter.
The movement in NAV was primarily attributable to the underlying external property valuation which reduced by 1.4% over the quarter.
The NAV attributable to the ordinary shares is calculated under International Financial Reporting Standards and incorporates the external portfolio valuation as at 31 December 2012, including income for the quarter, but does not include a provision for the quarterly dividend announced herein, which will be paid in February 2013.
The property portfolio will next be subject to an external valuation during March 2013 and the NAV per share, as at 31 March 2013, will be issued in April 2013.
A more detailed breakdown of the NAV is included within the Appendix.
DIVIDEND
An interim dividend of 0.75 pence per share is declared in respect of the period 1 October 2012 to 31 December 2012 (1 July 2012 to 30 September 2012: 0.75 pence).
The dividend will be paid on 28 February 2013 to shareholders on the register on 15 February 2013. The ex-dividend date will be 13 February 2013.
DEBT
During the quarter the Company repaid £31.1 million of ZDPs due to mature in October 2012 and issued £22 million ZDPs which mature in October 2016. Through amortisation, £0.2 million of debt was repaid under the Company's Aviva debt facility.
As at 31 December 2012, net gearing, calculated as total debt including ZDPs less cash, as a proportion of gross property value, was 53.8%. The weighted average debt maturity profile is approximately 15 years.
CORPORATE
Effective January 2013, Picton strengthened its management team with the appointment of Vic Holmes as a non executive director. Vic was previously the Chief Executive within Northern Trust's Channel Islands operation.
Fraser D'Arcy has been appointed Investment Director within Picton Capital, which he joins from Threadneedle Investments, having spent the last six years primarily focused on acquisitions and disposals across sectors and the wider UK market.
MARKET BACKGROUND
According to the IPD Monthly Index, total returns in the 3 months to December 2012 were 0.5%. Income return remained stable at 1.7% while capital growth was recorded at -1.1%.
Across the principal sectors, capital movements were negative, with retail at -1.7%, offices - 0.4% and industrial -1.1%. The most marked movements in the subsectors were Central London Offices at 1.5%, Retail Warehouses at -1.7% and Rest of UK Offices at -2.9%.
Occupancy rate on the Index was 90.1% as at December 2012.
PORTFOLIO UPDATE
During the quarter, the Company completed 18 lettings, two lease renewals and four active management surrenders (three of which have already been let) and one small owner occupier disposal.
These transactions were ahead of estimates and resulted in rental income increasing by £0.3 million per annum over the period. This included:
· Offices - Austin Friars EC2, Boundary House EC3, Marlow
· Industrial - Harlow, Wokingham, Belfast, Portsmouth, Luton, Reading
· Retail - Birmingham, Huddersfield
In line with the wider market, positive valuation movements were recorded in central London. Equally, the most marked adverse movements were recorded in the retail warehouse and regional office markets. By way of comparison the Company's regional office portfolio outside London, reflects a valuation equivalent to approximately 50% of the most recent estimate of cost of construction.
As at 31 December 2012, the portfolio had a net initial yield of 7.4% (30 September 2012: 7.3%) and a net reversionary yield of 8.1% (30 September 2012: 7.9%). Excluding purchasing costs, the portfolio initial yield stands at 7.9%, ahead of the IPD Monthly Index at 6.4%. The occupancy rate remained stable and unchanged from the previous quarter at 89%.
The weighted average unexpired term (to first termination) was 6.8 years (30 September 2012: 6.9 years).
Appendix
NET ASSETS SUMMARY
The unaudited NAV is as follows:
| 31 Dec 2012 £million | 30 Sep 2012 £million |
30 Jun 2012 £million |
|
| Investment properties * | 388.9 | 394.9 | 400.2 |
| Other assets | 12.3 | 12.3 | 7.7 |
| Cash | 22.3 | 32.0 | 30.1 |
| Other liabilities | (15.8) | (16.9) | (17.4) |
| Borrowings: Loan facilities Loan stock ZDP's Securitised loan Liquidity facility Bank loan |
(208.8) (2.1) (22.3) - - - |
(209.0) (2.1) (31.0) - - - |
- (2.2) (30.5) (171.6) (10.7) (16.9) |
| Market value of interest rate swaps | - | - | (3.7) |
| Net Assets | 174.5 | 180.2 | 185.0 |
| Net Asset Value per share | 51p | 52p | 54p |
* The underlying property valuation is stated net of lease incentives.
The movements in the Net Assets can be summarised as follows;
| Total | Movement | Per share | |
| £million | % | Pence | |
| Net Assets at 30 September 2012 | 180.2 | 52 | |
| Movement in property values (realised and unrealised) | (7.3) | (4.0) | (2) |
| Net income for the period (after distributions) | 1.6 | 0.8 | 1 |
| Net Assets at 31 December 2012 | 174.5 | (3.2) | 51 |
PORTFOLIO COMPOSITION
The Company's current portfolio is structured as follows:-
| Sector | Weighting 31 December 2012 |
Like for Like Valuation Change |
| Retail | 19.6% | -0.3% |
| Offices - Central/Greater London | 17.3% | 0.1% |
| Offices - Rest of UK | 17.4% | -4.5% |
| Industrial | 34.8% | -0.9% |
| Leisure | 4.2% | -0.6% |
| Retail Warehouse | 6.7% | -3.1% |
| Total | 100% | -1.4% |
GEOGRAPHICAL WEIGHTINGS
| Geography | Weighting 31 December 2012 |
| Central & Greater London | 25.4% |
| South East | 29.4% |
| South West | 3.9% |
| Midlands | 16.7% |
| North | 16.6% |
| Scotland | 2.3% |
| Wales | 5.2% |
| Northern Ireland | 0.5% |
| Total | 100% |
TOP TEN ASSETS
| Asset | Weighting 31 December 2012 |
| Unit 5320 Magna Park, Lutterworth | 7.4% |
| River Way Industrial Estate, Harlow | 7.2% |
| Stanford House, Long Acre, WC2 | 5.6% |
| 50 Farringdon Road, EC1 | 4.1% |
| Phase II Parc Tawe, Swansea | 4.0% |
| Boundary House, Jewry Street, EC3 | 3.6% |
| Angel Gate Office Village, City Road, EC1 | 3.1% |
| Colchester Business Park, Colchester | 3.0% |
| 1 Chancery Lane, WC2 | 2.8% |
| Angouleme Way Retail Park, Bury | 2.7% |
| Total | 43.5% |
For further information:
Tavistock Communications
Jeremy Carey/James Verstringhe, 020 7920 3150, [email protected]
Picton Capital Limited
Michael Morris, 020 7011 9978, [email protected]
Renee McIver
The Company Secretary
Northern Trust International Fund Administration Services (Guernsey) Limited
Trafalgar Court
Les Banques
St Peter Port
Guernsey
GY1 3QL
Tel: 01481 745324
Fax: 01481 745085
Note to Editors
Picton Property Income Limited ('Picton') is an income focused, internally managed Investment Company listed on the London and Channel Islands Stock Exchanges. It was established in 2005 to invest both directly and indirectly in commercial property across the United Kingdom.
With Net Assets of £174.5 million at 31 December 2012 and approximately 850 investors, the Company's objective is to provide shareholders with an attractive level of income, together with the potential for capital growth by investing in the principal commercial property sectors. www.pictonproperty.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
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