7th Mar 2012 15:45
7 March 2012
Capital Shopping Centres Group PLC (the "Company")
CAPITAL SHOPPING CENTRES GROUP PLC ANNUAL FINANCIAL REPORT 2011, NOTICE OF 2012 ANNUAL GENERAL MEETING AND SCRIP DIVIDEND SCHEME BOOKLET
Capital Shopping Centres Group PLC has today published its Annual Report for the year ended 31 December 2011 ("Annual Report"), Notice of 2012 Annual General Meeting ("AGM Notice") and Scrip Dividend Scheme Booklet ("Scrip Booklet"). All three documents are available for download at www.capital-shopping-centres.co.uk.
In addition, attention is drawn to the Company's Audited Results for the year ended 31 December 2011 which were published on 23 February 2012 and are also available for download at www.capital-shopping-centres.co.uk.
The AGM Notice contains, amongst other matters, a resolution which proposes changes to the Company's Articles of Association. A summary of the proposed changes is set out in Appendix A to this announcement.
Copies of the Annual Report, AGM Notice and Scrip Booklet have been submitted to the National Storage Mechanism, and will shortly be available for inspection at www.hemscott.com/nsm.do.
In accordance with DTR 6.3.5, the information in Appendix B to this announcement is extracted from the Annual Report and should be read in conjunction with Capital Shopping Centres Group PLC's Audited Results for the year ended 31 December 2011 which were released on 23 February 2012. Together these constitute the material required by DTR 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service.
Susan Marsden
Company Secretary
Capital Shopping Centres Group PLC
Appendix A
Summary of proposed amendments to be made to Capital Shopping Centres Group PLC's Articles of Association (which, if approved, will come into force from the close of the Annual General Meeting to be held on 23 April 2012):
A special resolution is proposed to amend part of Article 132 of the Company's Articles of Association in order to clarify certain provisions in respect of any scrip dividend scheme which the Company may decide to implement.
The current Articles already allow the Directors to offer a scrip dividend alternative (subject to shareholder approval). The revised paragraphs of Article 132, as set out on page 10 of the AGM Notice, describe the method by which the price of a scrip share is to be calculated (including to reflect the requirements of the JSE), and provide the Directors with suitable flexibility as to the treatment of any fractional entitlements that may arise in connection with the operation of a scrip dividend scheme and the requirements for the two exchanges on which the Company's shares are listed. The proposed new Articles of Association, showing all the changes to the current Articles of Association, are available for inspection during normal business hours at the offices of Linklaters LLP, One Silk Street, London, EC2Y 8HQ, and will be available for inspection at the place of the meeting, One Whitehall Place, London, SW1A 2HD, at least 15 minutes prior to the commencement of, and during the continuance of, the AGM.
Appendix B - Key risks and uncertainties
CSC recognises that it faces a number of risks in achieving its strategic objectives. Effective identification and management of risks is a major factor in CSC's ability to deliver strategic objectives. The risk management framework targets the early identification of keys risks and the formation of plans to remove or mitigate them. It focuses on managing these risks to maximise returns and minimise negative impacts.
The CSC Board has overall responsibility for managing risk across the Group. The process as designed involves identification and review of risk involving all areas of the business and resulting in appropriate action plans. Operational reviews performed by each team focus on the impact of changing risks on the function's key objectives and, along with reviews of current controls and the resulting action plans, are subject to executive challenge. The executive team also conducts a strategic review which considers changes in the overall environment which may prevent the business from achieving its objectives. Combined action plans are subject to a detailed review and challenge process, including by the Audit Committee. Progress on implementation of actions is regularly monitored and informs the next phase of identification and analysis.
Risk and Impact | Mitigation | Change | 2011 commentary |
Property market: macro environment weakness could undermine rental income levels and property values, reducing return on investment and covenant headroom | ·; Focus on prime assets ·; Covenant headroom monitored and stress tested ·; Regular monitoring of tenant strength and diversity |
é | ·; Despite macro concerns and reducing consumer confidence from early summer 2011, positive valuation movement of 1 per cent for the year reflecting prime nature of assets ·; Covenant headroom on individual properties increased during 2011
|
Financing: Reduced availability of funds could limit liquidity leading to restriction of investing and operating activities and/or increase in funding cost | ·; Regular reporting to Board of current and projected funding position ·; Effective treasury management aimed at balancing long debt maturity profile and diversification of sources of finance
|
çè | ·; Renewed uncertainty in banking and debt markets. However CSC's position supported by capital raising, acquisition of long-dated Trafford Centre debt and new broader-based corporate revolving credit facility
|
Operations: Accident, system failure or external factors could threaten the safe and secure environment provided for shoppers and retailers, leading to financial and/or reputational loss | ·; Strong business process and procedures supported by regular training and exercises ·; Annual audits of operational standards carried out by internal and external consultants ·; Culture of visitor safety ·; Retailer liaison and briefings ·; Appropriate levels of insurance |
ê | ·; Roll out of group policy and best practice post Trafford acquisition complete ·; Seamless transition to "Facilities Alliance", CSC's innovative property management partnership, with efficiency savings reinvested in fabric improvements ·; Mid year riots provided test of existing procedures: generally well managed, learning points implemented including new policies on monitoring and use of social media ·; Regulatory change: good ranking in Carbon Reduction Commitment "early action metrics"
|
Strategy and execution: Misjudged or poorly executed strategy fails to create shareholder value | ·; Annual strategic review by Board informed by external research and advice ·; Board and management team experienced in shopping centre and broader retail industry ·; Engagement with national and international retailers ·; Key staff succession planning, performance-based incentives |
çè | ·; Focus on optimising performance of pre-eminent centres to benefit from ongoing structural shift in UK retail, including broader offer of leisure and catering and inclusion of "theatre" ·; Fresh perspective from new directors / management has enhanced debate while maintaining our long term sustainable growth objective
|
Developments and acquisitions: Misjudged or poorly executed project results in increased cost or income foregone, hence fails to create shareholder value | ·; Capital Projects Committee reviews detailed appraisals before and monitors progress during significant projects ·; Research and third party due diligence undertaken for transactions
|
çè | ·; Increased focus on pre-let space before committing capital to projects ·; Unprecedented number of planning applications including local consultations, positioning the group for next phase of growth
|
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