TIDMCLI
RNS Number : 8826P
CLS Holdings PLC
23 November 2016
CLS Holdings plc
("CLS", the "Company" or the "Group")
Trading Update for the period 1 July 2016 to 22 November
2016
Chief Executive of CLS, Fredrik Widlund, commented:
"Since 1 July, we have continued to rebalance our portfolio,
with the disposals of non-core assets in France and London and the
acquisition of higher yielding properties in Germany. I am pleased
to report that occupier markets in London have remained resilient
to the uncertainty created by Brexit, whilst vacancy rates have
fallen in Germany and, in particular, in France. Our geographical
diversification and the relative strength of our non-sterling
assets continue to positively contribute to the net assets and
profits of the Group.
"With the cost of debt at an historical low, a strong balance
sheet and low vacancy levels, we remain well positioned to take
advantage of future opportunities and to continue delivering value
and cash for shareholders."
Portfolio changes since 1 July 2016
-- Acquisition of Parsevalstrasse 11, Dusseldorf for EUR43.6
million, at a net initial yield of 7.1%
-- Acquisition of Harburger Ring 35, Hamburg for EUR5.9 million,
at a net initial yield of 6.4%
-- Disposal of Chancel House, Neasden Lane, NW10 for GBP18.7
million, 39% above its value at 31 December 2015 and representing a
net initial yield of 3.3%
-- Disposal of Chorus, 2203 Chemin de St Claude, Antibes for
EUR9.4 million, marginally above its value at 31 December 2015, and
at a net initial yield of 7.6%
Operational metrics
-- 286,384 sq ft (26,606 sqm) vacated or expired since 1 July
2016, and 5,952 sq ft (553 sqm) of vacant space was acquired at
Parsevalstrasse 11
-- 295,760 sq ft (27,477 sqm) of new leases, lease renewals and
extensions completed at an average of 4.5% above ervs of 31
December 2015
-- Included in the above:
o the early renegotiation of a new 12 year extension to the
lease with Colt Telecom at erv on 105,895 sq ft (9,838 sqm) in
23/27 Rue Pierre Valette, Paris
o Linde AG extended its lease by 10 years on 35,798 sq ft (3,326
sqm) at Fandiekstrasse 75, Hamburg at 9.6% above erv
-- Overall Group vacancy rate: 3.4% (30 June 2016: 3.7%):
o London: 4.9% (30 June 2016: 4.6%)
o Rest of UK: 0.9% (30 June 2016: 0.9%)
o Germany: 1.9% (30 June 2016: 2.1%)
o France: 3.5% (30 June 2016: 5.0%)
-- Closure of our Lyon office effective at the end of 2016,
consolidating the entire French operation into a new Paris office,
and reducing administration costs
Developments and refurbishments
-- At Vauxhall Square, SW8:
o demolition of Wendle Court is close to completion
o on the main site, the largest occupier, Cap Gemini, vacates on
31 December and plans are well advanced to begin the refurbishment
early next year of the office it occupied at 95 Wandsworth Road
o JLL has been appointed to seek a development partner for
Vauxhall Square
-- In July, the development commenced of phase 2 of Spring Mews,
SE11, an GBP8.6 million, 7-storey development of 9,181 sq ft (853
sqm) of office and student accommodation which is expected to reach
practical completion in late 2017
-- At Ateliers Victoires, 48 Rue Croix des Petits Champs, Paris,
the GBP8.2 million redevelopment remains on track to complete in
2017, and marketing of the 21,500 sq ft (2,000 sqm) of space will
begin early in the new year
Financing
-- Seven new bank loans completed since 1 July 2016 for GBP91.7
million in aggregate at an average rate of 1.68%, mostly at fixed
rates, and for an average of over 5.4 years
-- Weighted average cost of debt reduced to 3.08% (30 June 2016:
3.27%), a record low for the Group
-- Weighted average loan to value of property loans comfortable at 50.5% (30 June 2016: 50.6%)
-- Liquid resources of over GBP170 million, comprising GBP72
million of cash, GBP55 million of corporate bonds, and undrawn
facilities in excess of GBP45 million
-- In the latest tender offer, all of the ordinary shares
available were cancelled by the Company on 22 September, resulting
in a distribution of GBP7.2 million to shareholders and leaving
40,739,576 ordinary shares in circulation
Portfolio statistics
-- Portfolio split by region at 30 September 2016:
o London 54%
o Rest of UK 6%
o Germany 23%
o France 17%
-- 52% of portfolio is subject to indexation
-- 35% of rent roll is derived from government tenants and 30% from major corporations
-ends-
For further information, please contact:
CLS Holdings plc +44 (0)20 7582 7766
www.clsholdings.com
Fredrik Widlund, Chief Executive Officer
John Whiteley, Chief Financial Officer
Liberum Capital Limited +44 (0)20 3100 2222
Richard Crawley
Panmure Gordon (UK) Limited +44 (0)20 7886 2500
Dominic Morley
Andrew Potts
Elm Square Advisers Limited +44 (0)20 7823 3695
Jonathan Gray
Smithfield Consultants (Financial PR) +44 (0)20 7360 4900
Alex Simmons
Forward-looking statements
This document may contain certain 'forward-looking statements'.
By their nature, forward-looking statements involve risk and
uncertainty because they relate to future events and circumstances.
Actual outcomes and results may differ materially from those
expressed or implied by such forward-looking statements. Any
forward-looking statements made by or on behalf of CLS speak only
as of the date they are made and no representation or warranty is
given in relation to them, including as to their completeness or
accuracy or the basis on which they were prepared. Except as
required by its legal or statutory obligations, the Company does
not undertake to update forward-looking statements to reflect any
changes in its expectations with regard thereto or any changes in
events, conditions or circumstances on which any such statement is
based. Information contained in this document relating to the
Company or its share price, or the yield on its shares, should not
be relied upon as an indicator of future performance.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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