24th Oct 2019 09:07
(Alliance News) - RDI REIT PLC on Thursday lowered its interim dividend Thursday as it swung to a loss in a challenging year.
For the year to the end of August, the retail and commercial-focused property firm reported a pretax loss of GBP79.3 million, compared to a profit of GBP63.8 million.
This was due to a loss on the revaluation of investment properties at GBP56.6 million, compared to a gain of GBP4.7 million. There was also a GBP55.6 million one-off loss, caused by the loss of control of RDI's Aviva UK shopping centres portfolio.
The portfolio includes four of the Johannesburg and London-listed real estate investment trust's UK shopping centres, namely the Grand Arcade in Wigan, Weston Favell in Northampton, Birchwood in Warrington and Byron Place in Seaham.
The portfolio was financed by a long-term fixed rate debt facility with London-listed insurer Aviva PLC, however after considering challenges in the UK retail sector, RDI decided to enter an agreement with Aviva to dispose of the shopping centres.
In April a standstill agreement was signed, that runs to the end of December. However Aviva's rights under the facility agreement remain in force, with the standstill agreement able to be terminated at any time. As a result, RDI considers the transaction as a loss of control.
RDI's Net rental income declined by 4.6% to GBP80.8 million from GBP84.7 million the prior year.
As at August 31, net asset value per share was 185.5 pence, down 13% from 213.8p the same date the year before, as the company's portfolio value dropped by GBP1.42 billion from GBP1.62 billion.
RDI declared a second interim dividend of 6.0 pence per share, bringing the total payout to 10.0p, down 25% from 13.5p the prior year.
"A significant amount of work has been undertaken over the past twelve months, and particularly since we set out our intentions at the half year to further reduce leverage and accelerate the reweighting of the portfolio through the disposal of certain retail assets," said Chair Gavin Tipper.
"I am pleased to report that important steps have been taken towards reaching these goals, with our retail holdings as the date of this report having been reduced by approximately 15%, and that, despite the difficult market backdrop, operational results across the business remain robust, reflecting the portfolio's increasing exposure towards growth subsectors and stronger economic locations," Tipper added.
Shares in RDI REIT were marginally lower in London at 126.77 pence, while its Johannesburg shares were untraded on Thursday, last quoted at ZAR23.59.
By Dayo Laniyan; [email protected]
Copyright 2019 Alliance News Limited. All Rights Reserved.
Related Shares:
AvivaRDI.L