TIDMCLI
RNS Number : 1424I
CLS Holdings PLC
22 November 2018
Release date: 22 November 2018
Embargoed until: 07:00
CLS Holdings plc
("CLS", the "Company" or the "Group")
Trading Update for the period 1 July 2018 to 21 November
2018
Improving occupancy and strong operational performance across
the Group
Chief Executive of CLS, Fredrik Widlund, commented:
"In the second half of 2018 we have seen a robust performance
across each of our markets in the UK, Germany and France. We have
completed significant lettings including key properties acquired in
2017 where we identified asset management opportunities at the time
of purchase, and our Group vacancy level has fallen from 5.7% to
4.3%.
"We remain confident that our results will be in line with
market expectations for the full year, notwithstanding the current
political and economic uncertainties. Our cost of debt is at a
historical low, we have a strong balance sheet with substantial
liquid resources and are well positioned to take advantage of
opportunities as they arise."
Operational metrics
Vacancies being driven down across the Group.
-- Vacancy rate:
Group: 4.3% (30 June 2018: 5.7%)
UK: 4.2% (30 June 2018: 5.4%)
Germany: 5.1% (30 June 2018: 7.1%)
France: 3.2% (30 June 2018: 3.5%)
-- A net reduction in vacancies of 83,000 sq ft (7,711 sqm) since 30 June 2018:
o 323,961 sq ft (30,097 sqm) of new leases, lease renewals and
extensions completed
o 240,961 sq ft (22,386 sqm) vacated or expired
o Since 1 January 2018, 493,000 sq ft of new leases, lease
renewals and extensions completed at an average 4.3% above ervs at
31 December 2017
-- Included in the above, since 30 June 2018:
o In total 69 separate lettings
o 86% of UK expiries renewed
o Notable new leases included 75,390 sq ft (7,003 sqm) to four
tenants at East Gate, Munich, and 23,594 sq ft (2,192 sqm) to IWG
Group at One Elmfield Park, Bromley
Portfolio changes since 30 June 2018
Repositioning the portfolio for growth.
-- Disposals since 30 June 2018 comprised:
o Buspace Studios, 10 Conlan Street, London W10 for GBP13.5
million, 4.2% above the value at 31 December 2017 and at a net
initial yield of 4.5%
o Three smaller individual disposals for an aggregate value of
GBP6.6 million: Melita House, Chertsey; Units 3/5, Brooklands,
Plymouth; and Marler Stern, Marl, Germany, which were sold in
aggregate at 8.2% above their collective value at 31 December
2017
Developments and refurbishments
Completed developments will create value.
-- At Ateliers Victoires, 48 Rue Croix des Petits Champs, Paris,
the GBP8.2 million redevelopment completed in October 2018, and the
fit-out of the entire 21,500 sq ft (2,000 sqm) of space to our
tenant Epoka is under way
-- The development of 16 Tinworth Street SE11 (formerly known as
Phase 2 of Spring Mews), a 7-storey development of 9,181 sq ft (853
sqm) of office and student accommodation in Vauxhall, reached
practical completion in August
Financing
Low cost of debt and substantial liquid resources.
-- Redemption of GBP65 million 5.5% unsecured bonds due 2019 on
31 July 2018, 17 months early for GBP68.4 million
-- Weighted average cost of debt reduced to 2.43% (30 June 2018: 2.65%)
-- Balance sheet loan-to-value 38.1% (30 June 2018: 38.4%)
-- Corporate bond portfolio reduced through disposals to GBP34.3
million (30 June 2018: GBP46.5 million)
-- Current liquid resources of over GBP180 million, comprising
GBP89 million of cash, GBP34 million of corporate bonds, and
undrawn facilities in excess of GBP60 million
Portfolio statistics
A diversified, pan-European portfolio with strong
fundamentals.
-- Portfolio split by region:
UK: 52%
Germany: 32%
France: 16%
-- 49% of rent roll is subject to indexation increases
-- 27% of rent roll is derived from government tenants and 26% from major corporations
Stakeholder engagement
Enhancing the environment.
-- Listening to customers - in the UK and France, we completed
surveys of occupiers at 29% of the Group's portfolio as part of a
continual improvement process
-- Award-winning responsibility - we have been awarded a Green
Apple Award for best environmental practice on our recycling
campaign across our managed UK assets
-- Enhancing renewable energy - we have more than doubled our
on-site renewable generation capacity through 3 large solar PV
installations in 2018, taking our capacity to 304kW (2017: 128 kW)
and further reducing energy costs for our customers
-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 +44 (0)20 3100 2222
Richard Crawley
Jamie Richards
Whitman Howard +44 (0)20 7659 1261
Hugh Rich
Robin White
Elm Square Advisers +44 (0)20 7823 3695
Jonathan Gray
Smithfield Consultants (Financial PR) +44 (0)20 3047 2476
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 news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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