TIDMSLI
RNS Number : 0772W
Standard Life Invs Property Inc Tst
24 January 2012
STANDARD LIFE INVESTMENTS PROPERTY INCOME TRUST LIMITED
31 December 2011
Key Highlights
-- Property worth GBP12.2m sold in Q4 2011
-- Cash held by the Trust was GBP17.8m at 31 December 2011
-- Based on a share price of 58.25p (20 January 2012) the dividend yield is 7.8%
-- Net asset value per ordinary share was 62.8p per share as at
31 December 2011, an increase of 2.1% from 30 September 2011
Net Asset Value
The unaudited net asset value per ordinary share of Standard
Life Investments Property Income Trust Limited at 31 December 2011
was 62.8 pence. This is an increase of 2.1% percentage points over
the net asset value of 61.5 pence per share at 30 September
2011.
The net asset value is calculated under International Financial
Reporting Standards ("IFRS") and includes a provision for payment
of an interim dividend of 1.133p per ordinary share for the quarter
to 31 December 2011.
The net asset value incorporates the external portfolio
valuation by Jones Lang LaSalle at 31 December 2011. The property
portfolio will next be valued by an external valuer during March
2012 and the next quarterly net asset value will be published
thereafter.
Breakdown of NAV movement
Set out below is a breakdown of the change to the unaudited net
asset value per share calculated under IFRS over the period 30
September 2011 to 31 December 2011.
Pence per % of opening
share NAV
Net Asset Value per share as at 30 61.5 -
September 2011
Gain - realised and unrealised following
revaluation of property portfolio
(including the effect of gearing) 0.4 0.6%
Increase in interest rate swap valuations 0.6 1.0%
Other movement in reserves 0.3 0.5%
Net Asset Value per share as at 31
December 2011 62.8 2.1%
Cash position
As at 31 December 2011 the Company had borrowings of GBP84.4m
and a cash position of GBP17.8m (excluding rent deposits) therefore
cash as a percentage of debt was 21.1%.
Loan to value ratio
As at 31 December 2011 the loan to value ratio (assuming all
cash is placed with RBS as an offset to the loan balance) was 41.1%
(30 September 2011: 44.5%). The covenant level is 65%.
Interest Rate Swaps
The interest rate swaps had a positive impact on the NAV of 0.6p
per share or 1.0% over the quarter, and the fair value liability is
GBP(6.1)m as at 31 December 2011. This fair value will reduce to
GBPnil by Dec 2013, although not on a straight line basis.
Total asset analysis as at 31 December 2011 (unaudited)
GBPm %
Office 73.3 40.3
------ ------
Retail 38.3 21.1
------ ------
Industrial 46.8 25.7
------ ------
Other 3.7 2.0
------ ------
Total Property Portfolio 162.1 89.1
------ ------
Cash 17.8 9.8
------ ------
Other Assets 2.0 1.1
------ ------
Total Gross Assets 181.9 100.0
------ ------
Breakdown in valuation movements over the period 30 September
2011 to 31 December 2011
Exposure Capital Value GBPm
as at 31 Movement
Dec 2011 on Standing
(%) Portfolio
(%)
External Valuation at
30/09/2011 173.4
---------- -------------- -------
Sub Sector Analysis:
---------- -------------- -------
RETAIL
---------- -------------- -------
South East Retail 6.1 0.0 0.0
---------- -------------- -------
Retail Warehouses 17.5 0.0 0.0
---------- -------------- -------
OFFICES
---------- -------------- -------
Central London Offices 13.8 6.0 1.3
---------- -------------- -------
South East Offices 13.5 0.0 0.0
---------- -------------- -------
Rest of UK Offices 18.0 (1.5) (0.4)
---------- -------------- -------
INDUSTRIAL
---------- -------------- -------
South East Industrial 4.7 3.5 0.2
---------- -------------- -------
Rest of UK Industrial 24.1 (0.5) (0.2)
---------- -------------- -------
OTHER 2.3 1.3 0.0
---------- -------------- -------
Sales during Q4 2011 - 1.7 (12.2)
---------- -------------- -------
External Valuation at
31/12/2011 100 0.4 162.1
---------- -------------- -------
Investment Manager Commentary
In December 2011 the Company signed a new Debt facility with RBS
to replace its existing facility of GBP84.4m which was due to
expire in December 2013. The Company has now drawn down in full the
new facility and entered into new interest rate hedges to give a
cost of debt of 6.38% until December 2013, reducing to 3.76% from
Jan 2014 to expiry of the facility in December 2018. The all in
cost prior to the new facility was 6%. The Company retained its
existing hedge of GBP72m due to expire in Dec 2013 as it had a
liability of GBP6.1m (4.5p per share) as at 31 December 2011. That
hedge will unwind (although not on a straight line basis) by Dec
2013 to a value of GBP0. For the avoidance of doubt, the new
facility will be used to repay the old facility, with no change to
the Company's level of borrowings.
The new facility has an LTV covenant of 65% for the first 5
years (same as old covenant), and 60% for the final 2 years. The
old ICR covenant of 170% has been reduced to 150% of net rental
income.
During Q4 the Company completed the sale of Northern and Shell
Tower in the Docklands for GBP12.2m, reflecting a yield of 7%. The
Company had bought the property for GBP10m in 2009 (a yield of
8.6%). The Company also exchanged contracts for the sale of a small
office in Leeds for GBP1.025m, and the sale completed on 20(th)
January 2012.
In addition, the Company successfully regeared a number of
leases which had an expiry or tenant break in 2012, 2013 and 2014.
Three leases with an expiry event in 2012 have been renewed or the
break removed, representing 79% of the rent at risk in 2012. Only
GBP250,000 of rent is at risk through lease event now in 2012. Two
leases have been regeared with breaks in 2013, representing 68% of
income at risk that year, leaving only GBP130,000 at risk of break
/ expiry in 2013. One lease has been regeared with an expiry in
2014, giving a new 10 year term.
The Company's void rate at the end of December 2011 was 5.1%.
The Company experienced the failure of a tenant on a retail park in
Hull, however our valuations had already assumed no rent from that
unit in 2012, and we have achieved a change of use to widen the
planning consent, and have agreed a new lease to Smyth's Toys on
the unit (due to complete in April 2012). We also completed the
letting of two small industrial units in Aberdeen at a rent of
GBP40,000pa, and a small office floor in Leeds for GBP30,000pa.
In Q4 2011 the Company's property portfolio has a total return
of 2.2%, against the IPD Monthly index total return of 1.6%. Over
the 12 months to December 2011 the Fund returned 6.5% (IPD monthly
8.1%) and over 3 years the fund returned 9.0%pa (IPD Monthly 8.1%
pa).
Based on unaudited accounts for the year end the Company had a
fully covered dividend (107%) for 2011.
* Source:- Standard Life Investments
All Enquiries:
Jason Baggaley - Real Estate Fund Manager Standard Life
Investments
Tel 0131 245 2833
Rona Grant - Real Estate Fund Manager Standard Life
Investments
Tel 0131 245 3890
The Company Secretary
Northern Trust International Fund Administration Services
(Guernsey) Ltd
Trafalgar Court
Les Banques
GY1 3Q1
Tel: 01481 745324
Fax: 01481 745085
Appendix 1
Historical adjusted IFRS NAVs per Ordinary Share are as
follows:
31/12/11 62.76p
30/09/11 61.49p
30/06/11 62.22p
31/03/11 64.09p
31/12/10 63.00p
30/09/10 61.37p
30/06/10 61.33p
31/03/10 59.56p
31/12/09 56.63p
30/09/09 51.28p
30/06/09 50.53p
31/03/09 52.49p
31/12/08 61.65p
30/09/08 87.24p
30/06/08 101.59p
31/03/08 102.71p
31/12/07 111.60p
30/09/07 130.70p
30/06/07 137.16p
31/03/07 134.42p
31/12/06 132.68p
30/09/06 129.51p
30/06/06 130.20p
31/03/06 124.28p
31/12/05 116.46p
30/09/05 107.12p
30/06/05 103.88p
31/03/05 101.34p
31/12/04 99.00p
This information is provided by RNS
The company news service from the London Stock Exchange
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