TIDMCSH
RNS Number : 0803B
Civitas Social Housing PLC
09 February 2022
9 February 2022
CIVITAS SOCIAL HOUSING PLC
("Civitas" or the "Company")
Net Asset Value, Trading Update and Dividend Declaration
Civitas Social Housing PLC ("Civitas" or the "Company"), the
UK's leading care-based and healthcare REIT, is pleased to announce
its quarterly net asset value ("NAV") update as at 31 December
2021, with performance continuing in line with expectations.
Highlights:
-- Consistently robust financial and operational performance, in
line with the Board's expectations
-- IFRS NAV per share of 108.78p - resilient as expected (30 Sept 2021: 108.49p)
-- Rents received as normal with no impact from COVID-19
-- Third 1.3875p quarterly dividend declared in line with full
year target of 5.55p (2021: 5.40p)
-- The Company offers a high degree of inflation protection to
investors through stable, inflation adjusted leases
Trading and Market Update
The Company is pleased to announce an increased NAV of 108.78
pence per share and a third quarterly dividend of 1.3875 pence per
share as targeted, consistent with the Board's stated objective of
paying a total dividend of 5.55 pence per share for the year ending
31 March 2022.
The Civitas portfolio continues to benefit from inflation
adjusted long-term leases or occupancy agreements with Approved
Providers and the Company aims to deliver returns broadly in line
with inflation over the long term.
The Omicron variant of COVID-19 has had no significant
operational or financial impact upon the Company and we are pleased
to note that the level of restrictions is now being reduced
considerably. High levels of care continue to be provided within
the properties and enhanced health and safety procedures have been
maintained to ensure residents can engage safely with families and
friends.
The UK's long-established Government policy of seeking to house
vulnerable people as near as possible to their own community,
remains in place. This reflects both a multi-decade cross-party
consensus and the experience of the pandemic, which has further
demonstrated how important care-based housing is for health and
life quality of the vulnerable, whilst providing value for money
for the taxpayer.
In addition, the Company, working in partnership with London
local authorities, has pioneered the provision of advanced
homelessness facilities in several locations to ensure those
experiencing homelessness have an opportunity to receive a full
suite of care and to recover their lives.
The Company offers its heartfelt thanks and support to all its
partners and their staff for their efforts during the pandemic.
Investment and Pipeline Update
During the quarter to 31 December 2021, Civitas completed the
acquisition of one property in Lancashire for a total consideration
of GBP1.4 million. The property provides a home for 13 individuals
with learning disabilities and mental health care needs.
Civitas is currently assessing a number of high-quality
opportunities with local authorities and care providers, to acquire
long term community housing for those with lifelong care needs.
Further announcements in this respect will be made in due course.
Deployment into these opportunities will be balanced with the
prudent objective of retaining sufficient liquidity at all
times.
Net Asset Values ("NAV"):
IFRS NAV
The unaudited IFRS NAV, disclosed below, reflects an independent
RICS "Red Book" valuation prepared on an individual asset basis by
Jones Lang LaSalle ("JLL").
31 30
Dec Sept
IFRS NAV 2021 2021
Ordinary NAV (GBP'000) 669,650 672,884
------- -------
Ordinary NAV per share (pence) 108.78 108.49
------- -------
The portfolio, based on individual asset valuations, has been
valued overall at 31 December 2021, at an average Net Initial Yield
of 5.29% (30 September 2021: 5.27%), after taking into account the
initial costs of property acquisitions incurred by the Company and
the assumed costs of a subsequent theoretical sale. The individual
valuations are determined by JLL and are based on a range of
underlying metrics including applicable discount rates and expected
long-term inflation.
The IFRS NAV reflects the contribution from the indexation of
leases in the period, less the cost of discretionary capital
expenditure that has been incurred to enhance further the quality
of the Company's properties to reflect the individual needs of
tenants for the long term. The slight reduction in IFRS NAV is
attributable to the recent buy back of ordinary shares which are
held in treasury for subsequent reissue.
For the financial year to date, the Company purchased 6,875,000
shares into treasury at an average price of 91.33p, being at a
discount to the Company's prevailing NAV per share. The impact of
the share repurchases at 31 December 2021 has been to enhance IFRS
NAV per share by 0.19p.
A dividend of 1.3875p per Ordinary Share was declared, as
targeted, on 8 November 2021 in respect of the quarter ended 30
September 2021 and paid on 13 December 2021 amounting to GBP8.6
million.
Portfolio NAV
The unaudited Portfolio NAV, disclosed below, reflects an
independent RICS "Red Book" valuation prepared on a portfolio basis
by JLL.
31 30
Dec Sept
PORTFOLIO NAV 2021 2021
Ordinary NAV (GBP'000) 741,346 742,636
------- -------
Ordinary NAV per share (pence) 120.43 119.74
------- -------
The portfolio, as a single entity, has been valued at 31
December 2021 at 5.06% Net Initial Yield (30 September 2021: 5.1%),
reflecting the enhanced value from the aggregation of individual
properties into a single portfolio company and the positive effects
of the stamp duty adjustment noted below.
The JLL portfolio valuation incorporates two additional
assumptions when considering Red Book valuation. Firstly, that the
assumed theoretical sale costs (from Civitas to a subsequent buyer)
are reduced as the portfolio is assumed to be sold (with all
properties within SPVs) with stamp duty being charged at 0.5% on
the sale of shares in SPVs, as opposed to 5.0% for the sale of each
underlying property. Secondly, that the portfolio is sold in its
entirety rather than as individual properties (making it better
suited to a wider group of institutional buyers) and so attracting
more competitive pricing. This assumption is supported by
transactional evidence that JLL has observed in the market.
Dividend Declaration
The Board has today declared a third quarterly dividend for the
period from 1 October 2021 to 31 December 2021 of 1.3875p per
Ordinary Share as part of the previously stated dividend target of
5.55p per Ordinary Share for the year ending 31 March 2022.
The dividend will be paid on or around 11 March 2022, to holders
on the register as at 18 February 2022 (the "record date"), with
the corresponding ex-dividend date being 17 February 2022. The
dividend will be paid as a REIT property income distribution. The
Company operates a Dividend Reinvestment Plan ("DRIP"), which is
managed by its registrar, Link Group. For shareholders who wish to
receive their dividend in the form of shares, the deadline to elect
for the DRIP is 18 February 2022.
Ongoing Engagement with Housing Associations
Civitas continues to take a proactive and collaborative approach
towards the housing associations and charitable entities holding
Civitas leases in support of their objective to enhance their
financial and operational performance and, where relevant for
certain housing associations, to respond to comments made by the
Regulator of Social Housing ("RSH").
Housing associations and charities have continued in the quarter
to report high levels of health and safety compliance in addition
to meeting their lease obligations to the Company.
Quarterly Factsheet
The Company has today published its Factsheet for the quarter to
31 December 2021 and this is available to view
on the Company's website .
LEI: 213800PGBG84J8GM6F95
S
For further information, please contact:
Civitas Investment Management
Limited
Andrew Dawber Tel: +44 (0)20 3058 4846
Paul Bridge Tel: +44 (0)20 3058 4844
Panmure Gordon
Sapna Shah Tel: +44 (0)20 7886 2783
Tom Scrivens Tel: +44 (0) 20 7886 2648
Liberum Capital Limited
Chris Clarke / Darren Vickers Tel: +44 (0) 20 3100 2000
/ Owen Matthews
Buchanan
Helen Tarbet / Henry Wilson Tel: +44 (0) 20 7466 5000
Hannah Ratcliff / George Beale civitas@buchanan.uk.com
Notes:
Civitas Social Housing PLC (CSH) was created in 2016 by Civitas
Investment Management Limited as the first dedicated London listed
REIT to raise long-term, sustainable, institutional capital to
invest in care-based social homes and healthcare facilities across
the UK. So far, Civitas has completed more than 120 individual
transactions to build the largest portfolio of its kind that has
been independently valued at GBP946.3million (30 September 2021).
CSH now provides homes for 4,404 working age adults with long-term
care needs, in 649 bespoke properties that are supported by 119
specialist care providers, 18 approved providers and working with
over 178 individual local authorities.
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END
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