TIDMCSH
RNS Number : 4610V
Civitas Social Housing PLC
10 August 2022
10 August 2022
CIVITAS SOCIAL HOUSING PLC
("Civitas" or the "Company")
Net Asset Values, Dividend Declaration,
Trading and Market Update
Consistent and positive portfolio performance
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 30 June 2022,
with performance continuing to be robust and dividend declared in
line with full year target.
Highlights:
-- Consistently robust financial and operational performance, in
line with the Board's expectations
-- Unaudited IFRS NAV per share increased to 111.89p (31 March 2022: 110.30p)
-- First quarterly dividend of 1.425p declared in line with full
year target of at least 5.70p(1) (2022: 5.55p)
-- Portfolio continues to benefit from contractual inflationary increases to rent roll
-- Work progressing on strengthening the sector including
seeking to achieve regulatory alignment through the previously
announced lease clause proposal
-- Sustained high demand for the specially adapted community-based homes that Civitas provides
Trading and Market Update
The Company is pleased to announce an increased unaudited NAV
per share of 111.89 pence (being a 1.44% increase over the quarter)
and a first quarterly dividend of 1.425 pence per share as
targeted, consistent with the Board's previously announced target
of paying a total dividend of at least 5.70 pence(1) per share for
the year ended 31 March 2023.
The Civitas portfolio benefits from inflation adjusted long-term
leases or occupancy agreements with Approved Providers (housing
associations and other not-for-profit organisations) and the
Company aims to deliver returns broadly in line with inflation over
the long-term.
As recently outlined, the Company has been working on a
regulatory clause in partnership with its Approved Providers with
the objective of helping them to achieve regulatory compliance.
This work is progressing and the Company will provide market
updates as and when appropriate.
Demand for care-based community housing remains high and is
projected to increase further still by independent bodies. The
Company is at the forefront of ensuring the sector maintains focus
on quality, value for money and robust governance.
Investment and Pipeline Update
During the quarter to 30 June 2022, the Company completed the
previously announced acquisition in Wisbech, Cambridgeshire for a
total consideration of GBP0.6 million (excluding purchase
costs).
The property is subject to indexed leases with Chrysalis (an
existing counterparty) and is immediately income generating with a
net initial yield in line with the Company's present
expectations.
(1) This is a target and not a formal dividend forecast or a
profit forecast
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").
30 31
June Mar
IFRS NAV 2022 2022
Ordinary NAV (GBP'000) 683,366 675,547
------- -------
Ordinary NAV per share (pence) 111.89 110.30
------- -------
The portfolio, based on individual asset valuations, has been
valued overall at 30 June 2022, at an average Net Initial Yield of
5.25% (31 March 2022: 5.28%), 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.
During the quarter to 30 June 2022, the Company also purchased
1,700,000 shares into Treasury at an average price of 87.72p, being
at a discount to the Company's prevailing NAV per share.
Collectively, the share repurchases during the quarter have
enhanced IFRS NAV per share by 0.06p.
A dividend of 1.3875p per Ordinary Share (amounting to GBP8.5
million) was declared, as targeted, on 11 May 2022 in respect of
the fourth quarter ended 31 March 2022 and paid on 28 June
2022.
Portfolio NAV
The unaudited Portfolio NAV, disclosed below, reflects an
independent RICS "Red Book" valuation prepared on a portfolio basis
by JLL.
30 31
June Mar
PORTFOLIO NAV 2022 2022
Ordinary NAV (GBP'000) 762,374 752,331
------- -------
Ordinary NAV per share (pence) 124.83 122.84
------- -------
The portfolio, as a single entity, has been valued at 30 June
2022 at 5.03% Net Initial Yield (31 March 2022: 5.06%), 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 first quarterly dividend for the
period from 1 April 2022 to 30 June 2022 of 1.425p per Ordinary
Share as part of the previously stated dividend target of at least
5.70p per Ordinary Share for the year ended 31 March 2023.
The dividend will be paid on or around 9 September 2022, to
holders on the register as at 19 August 2022 (the "record date"),
with the corresponding ex-dividend date being 18 August 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 19 August 2022.
The increased target dividend for the year ending 31 March 2023
reflects both the strong underlying cash generation that the
Company's portfolio is delivering and the Board's positive view of
the Company's prospects for the current financial year.
Quarterly Factsheet
The Company has today published its Factsheet for the quarter to
30 June 2022 and this is available to view on
the Company's website .
ENDS
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 / Verity Parker 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. CSH's portfolio has been independently valued at
GBP968.8million (31 March 2022). CSH now provides homes for 4,594
working age adults with long-term care needs, in 697 bespoke
properties that are supported by 130 specialist care providers, 18
approved providers and working with over 178 individual local
authority partners.
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END
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