16th Jul 2009 07:00
JAPAN RESIDENTIAL INVESTMENT COMPANY LIMITED ("THE COMPANY")
Consolidated Financial Statements for the Six Months Ended 31 May 2009
Japan Residential Investment Company Limited (AIM: JRIC) is a closed-ended Guernsey registered company established to make and hold investments in residential property in Japan. The Company presents its unaudited consolidated financial results for the six months ended 31 May 2009.
Highlights for the six months ended 31 May 2009
Underlying profit* before tax increased to £2.5 million over the same period one year prior
Loss for the period increased to £10.5 million from £4.5 million over the same period one year prior
Property operating expenses as a percent of gross rental income fell to 20.8% from 34.7% for the same period one year prior
Fund property values declined 4.6% during the six month period (decline of 10.8% during the 12 months ended 31 May 2009)
Gearing, calculated as net debt (borrowings less cash balances and lender restricted reserves) divided by total assets was 51.4%
NAV fell 14.7% during the period to 98.2p per share (100.9p based on exchange rate at 13 July 2009)
There are no significant refinancing events in 2009. Discussions with lenders are ongoing regarding the refinancing of ¥9.3 billion (£59.3 million) of debt maturing in 2010.
|
Results |
|
|
|
|
|
Six months ended 31 May |
||
|
|
2009 |
|
2008 |
|
|
£'000 |
|
£'000 |
|
Underlying Profit |
2,531 |
|
720 |
|
Loss on fair value adjustments of investment property |
(12,744) |
|
(6,127) |
|
Loss on fair value adjustments on interest rate cap contracts |
(60) |
|
59 |
|
Net foreign exchange (losses)/gains |
(107) |
|
49 |
|
Loss for the period before tax |
(10,380) |
(5,299) |
|
|
|
|
|
|
|
|
pence |
|
pence |
|
Underlying earnings per share |
2.53 |
|
0.72 |
|
Loss per share |
(10.48) |
|
(4.51) |
|
|
|
|
|
|
|
As at |
||
|
|
31 May |
|
30 November |
|
|
2009 |
|
2008 |
|
|
pence |
|
pence |
|
Net asset value per share |
98.20 |
|
115.16 |
|
|
|
|
|
|
|
£'000 |
|
£'000 |
|
Total equity |
98,200 |
|
115,159 |
|
Net Debt |
135,977 |
|
145,521 |
£ denominated values are based on the exchange rate of ¥154.344/£1 for assets acquired as at the balance sheet date. Post balance sheet amounts are converted at ¥151.175/£1 being the exchange rate as at 10 July 2009.
* "Underlying profit" is profit excluding losses from fair value adjustments and foreign exchange. The Fund uses "underlying business performance" in its internal financial reporting and provides this analysis as additional information.
For further information on the Company, please refer to the website, www.jricl.com, or contact:
K.K. Halifax Asset Management
Alec Menikoff
+81 (0)3 5563 8771
Fairfax I.S. PLC
John Korwin-Szymanowski
+44 (0)20 7460 4376
Smith & Williamson Corporate Finance Limited
Azhic Basirov
+44 (0)20 7131 4000
Chairman's Statement
I am pleased to present the interim report and unaudited condensed consolidated financial statements for the period ended 31 May 2009.
The objective of the Fund is to provide investors with stable yield and potential for long-term capital growth through exposure to Japanese residential properties. Despite economic turmoil, the Fund portfolio of 54 properties with 2,294 rental units has achieved stable cashflows, and occupancy rates in excess of 90% every month for over a year. Asset values have fallen in each of the past four quarters, 10.8% in total. Rental income and occupancy rates remain stable and the Fund continues to build-up cash reserves.
Results
Increased Gross rental income resulting from a larger portfolio and improved property operating performance helped raise Net rental income to £7.3 million in the period ended 31 May 2009 from £2.9 million in the same period one year prior. Underlying profit before tax (profit excluding losses from fair value adjustments and foreign exchange) was £2.5 million during the period. Unrealised valuation loss on existing properties was £12.7 million reflecting a 4.6% decline during the six months ended 31 May 2009 and led to the Loss for the period of £10.5 million (10.48p per share).
Net asset value per share fell to 98.2p at the end of the period, down from 115.2p six months prior due to unrealised asset value declines and foreign exchange fluctuations.
Outlook
The Board commends the Manager for the underlying portfolio's solid rental operating performance. Credit markets have relaxed somewhat, but debt remains difficult to obtain. With fewer buyers and a shortage of debt financing, the downward trend of asset values continues. With the support of the Manager, the Board is monitoring portfolio performance, cash positions, and debt closely. In the light of continuing economic difficulties the Board believes it prudent to plan for further deterioration in property values and a reduced availability of debt financing for real estate. In conjunction with the Manager, the Board are currently reviewing options to ensure sufficient liquidity to maintain a satisfactory debt to assets ratio and when appropriate to take advantage of market opportunities. We believe that the relatively defensive nature of the asset class combined with a significant cash position, proactive debt management, and the Fund's overall conservative stance position it well to weather the current market turmoil and prepare for future opportunities. However, the performance of the real estate market in general and the Fund in particular depends on the availability of debt at acceptable terms which is by no means certain in the current environment.
Distributions
In light of the above, the Board deems it prudent to preserve capital and refrain from making distributions at present. The Board will continue to monitor the market as well as the Fund's debt and cash position, with a view towards resuming distributions when conditions permit.
Raymond Apsey
Chairman
15 July 2009
Report of the Manager and the Investment Adviser
Market
The Japanese economy has been hit hard by the global downturn. GDP is forecast to decline 6.7% in 2009 with a modest uptick in 2010. Amidst weak global demand for export goods, business sentiment among large Japanese manufacturers reached a historic low in March before rebounding slightly in June. Unemployment, though still low compared to other OECD countries, hit a 5-year high of 5.2% in May.
In the six months ending March, the index of residential land values for the six major cities fell 5.4%, the steepest decline since 1993 (commercial land values fell 10.8% in the same period). Investor surveys show expected market capitalization rates increased 130bps in the past 18 months suggesting valuation declines of approximately 20% on income generating property.
However, transaction volume remains low with sellers outnumbering buyers by a significant margin. The most active part of the market is for assets under ¥1.0 billion (£6.5 million) in value, which appeal to individual buyers for investment yield and tax planning purposes. The anticipated volume of real estate foreclosures has yet to materialise. Banks, facing their own capital pressures, are reluctant to crystallize losses on bad loans and hesitant to take possession of assets given the current lack of liquidity in the market.
Credit markets remain highly constrained. Where debt is being made available, borrowers must contend with reduced leverage ratios, higher interest rate spreads, higher rates of amortization, and more restrictive covenants. The current financing benchmark is approximately 50-60% LTV against the lender's conservative internal value assumptions.
The recovery of the JREIT market is widely seen as a necessary precursor to a broader real estate market recovery. Concerns over JREIT refinancing risk have been addressed by government initiatives including the provision of loans through the Development Bank of Japan. The JREIT index recently reached levels last seen before the October collapse of the TSE - listed JREIT New City Residence.
Financial Results
Gross rental income more than doubled to £9.2 million for the 6 months ended 31 May 2009, versus £4.5 million for the same period one year prior. This was the result of higher occupancy rates and a larger portfolio (54 properties versus 35 at the beginning of the same period one year prior).
Property operating expenses during the period were £1.9 million, a 22.5% increase over the same period one year prior. However, the higher occupancy rate, reduced lease-up fees and larger revenue base contributed to a significantly lower operating expense ratio. Property operating expenses as a percent of Gross rental income fell to 20.8% from 34.7% for the same period one year prior. As a result of a larger revenue base and lower expense ratio, Net rental income expanded 2.5 times to £7.3 million for the period ended 31 May 2009 versus £2.9 million for the same period one year prior.
Underlying profit before tax (profit excluding losses from fair value adjustments and foreign exchange) increased 3.5 times to £2.5 million versus £720,000 for the same period one year prior. Unrealised valuation loss on existing properties was £12.7 million, a decline of 4.6% from the value as at 30 November 2008. Interest expense was £2.3 million, up from £1.2 million in the same period one year prior following an increase in Bonds and loans payable to £161.7 million as of 30 May 2009 from £118.4 million at period end one year prior. Loss for the period was £10.5 million.
Net asset value decreased to 98.2p as at 31 May 2009, from 115.2p as at the prior period end, as a result of asset value declines and foreign exchange fluctuations.
Gearing, calculated as net debt (borrowings less cash balances and lender restricted reserves) divided by total assets was 51.4% as at 30 May 2009. The debt to equity ratio calculated as net debt divided by total equity was 1.38x.
Borrowings
Fund debt totaled ¥25.1 billion (£162.9 million) as at 31 May 2009, down from ¥25.2 billion (£163.6 million) at the fiscal year end following the scheduled pay down of debt. An additional ¥150 million (£971,000) of debt is scheduled to be paid down between now and February 2010 in three equal quarterly installments. Debt is secured against 48 properties valued at ¥33.2 billion (£215.2 million) for a total Loan-to-value (LTV) ratio of 75.7% as at 31 May 2009.
As of 30 June 2009, the blended interest rate was 2.11% and the average remaining tenor was 21.6 months. Interest hedging strategies have been employed to protect against significant increases in interest rates. Of the total debt, 35.4% is fixed rate, 40.4% floating rate with a cap, and 24.2% floating rate with no cap. Of the total debt executed to date, 37% matures in 2010, 23% in 2011, and 40% in 2012.
Fund portfolios were compliant with lender LTV and debt service coverage ratio covenants as at 31 May 2009. However, asset value declines have resulted in reduced headroom - the buffer between loan amounts and lender mandated minimum property values. Continued declines in asset values could lead to breaches of LTV covenants resulting in a trapping of cash by the lender. For 35% of the outstanding debt, consecutive breaches of LTV covenants constitute an event of default and could result in an acceleration of the debt.
Portfolio
The portfolio consists of 54 properties valued at ¥36.4 billion (£236.1 million) as at 31 May 2009. Fund property values fell 4.6% in the six months ended 31 May 2009 (10.8% yoy). Property values are down 9.1% from initial purchase price excluding acquisition costs. The unleveraged, Net Yield of the portfolio (projected property-level Net Operating Income over value) is 5.7%.
The occupancy rate of the portfolio was 92.2% as at 31 May 2009, down from 94.2% as at 30 November 2008. Tenant cancellations are increasing and the Investment Adviser anticipates downward pressure on occupancy rates and rents. Leases with corporate counterparties represent 27.7% of fund leases currently in place. Due to overall tenant quality and third party guarantees on the majority of leases, instances of non-collection of rent have been limited to less than 0.1% of gross rental income.
The age of the portfolio remains low at 3.6 years, due to the large proportion of newly built properties acquired on completion. 95% of the portfolio by value is less than 5 years old. The regional allocation of the portfolio by value is as follows: Tokyo (43%), Osaka (28%), Nagoya (14%) and Other (15%).
Outlook
The credit crisis has led to market upheaval on a global scale. It has resulted in a pronounced economic downturn the duration and depth of which remains unclear. In this difficult environment, we are focused on maximising operating income, reducing costs, and managing debt exposure in a prudent manner.
Institutional and private investors seeking hard assets with stable cash flow continue to target Japanese real estate. We anticipate increased interest in Japanese residential property due to the stability of rent and occupancy levels relative to the commercial sector
The attitude of lenders is currently better than it was six months ago, however, credit markets appear to remain fragile. The Investment Adviser is actively engaged in discussions for the refinancing of 2010 debt. It is clear that the assumptions for borrowing on which the investment programme was established are no longer achievable. Furthermore, it appears likely that economies will continue to delever and credit markets will remain constrained for the foreseeable future.
In the current climate, we anticipate further downward pressure on property values. While we believe that downside risks are mitigated by the fact that property values in Japan declined substantially throughout the '90s before stabilising in the early part of this decade, recovery in the real estate sector will require normalisation in the debt markets.
|
KK Halifax Management Limited |
KK Halifax Asset Management |
|
Manager |
Investment Adviser |
Condensed Interim Consolidated Income Statement
For the six months ended 31 May 2009
|
|
|
1 December 2008 to 31 May 2009 |
1 December 2007 to 31 May 2008 |
|
|
|
Unaudited |
Unaudited |
|
|
Notes |
£'000 |
£'000 |
|
|
|
|
|
|
Gross rental income |
|
9,216 |
4,504 |
|
Property operating expenses |
|
(1,914) |
(1,562) |
|
Net rental income |
|
7,302 |
2,942 |
|
|
|
|
|
|
Administrative expenses |
|
(2,479) |
(1,053) |
|
|
|
|
|
|
Interest income |
|
18 |
32 |
|
Interest expense |
|
(2,310) |
(1,201) |
|
Net interest expense |
|
(2,292) |
(1,169) |
|
|
|
|
|
|
Underlying profit* |
|
2,531 |
720 |
|
|
|
|
|
|
Acquisition costs of properties purchased |
|
- |
(3,102) |
|
Unrealised valuation gain on current period purchases |
|
- |
196 |
|
Unrealised valuation loss on existing properties |
|
(12,744) |
(3,221) |
|
Net loss from fair value adjustments on investment property |
3 |
(12,744) |
(6,127) |
|
|
|
|
|
|
Net foreign exchange (losses)/gains |
|
(107) |
49 |
|
|
|
|
|
|
(Loss)/Gain on fair value adjustments on interest rate cap contracts |
(60) |
59 |
|
|
|
|
|
|
|
Loss for the period before tax |
|
(10,380) |
(5,299) |
|
|
|
|
|
|
Taxation (charge)/credit |
4 |
(102) |
793 |
|
|
|
|
|
|
Loss for the period |
|
(10,482) |
(4,506) |
|
|
|
|
|
|
|
|
|
|
|
Loss per share - Basic and diluted |
|
(10.48p) |
(4.51p) |
All items in the above statement are derived from continuing operations.
The loss is attributable to shareholders of the Company. There are no minority interests.
* “Underlying profit" is profit excluding losses from fair value adjustments and foreign exchange. The Fund uses "underlying business performance" in its internal financial reporting and provides this analysis as additional information.
Condensed Interim Consolidated Balance Sheet
As at 31 May 2009
|
|
|
31 May 2009 |
30 November 2008 |
31 May 2008 |
|
|
|
Unaudited |
Audited |
Unaudited |
|
|
Notes |
£'000 |
£'000 |
£'000 |
|
Assets |
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Investment property |
3 |
236,155 |
261,707 |
185,171 |
|
Interest rate cap contracts |
|
17 |
74 |
204 |
|
Deferred tax asset |
|
- |
- |
550 |
|
|
|
236,172 |
261,781 |
185,925 |
|
Current assets |
|
|
|
|
|
Trade and other receivables |
|
2,593 |
3,900 |
1,814 |
|
Restricted lender reserves |
|
5,477 |
6,742 |
5,109 |
|
Cash at bank |
|
20,282 |
19,161 |
22,971 |
|
|
28,352 |
29,803 |
29,894 |
|
|
Total assets |
|
264,524 |
291,584 |
215,819 |
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
Security deposits from tenants |
|
1,205 |
1,414 |
594 |
|
Bonds and loans payable |
5 |
140,832 |
170,054 |
118,457 |
|
Deferred tax liability |
|
271 |
190 |
149 |
|
|
142,308 |
171,658 |
119,200 |
|
|
Current liabilities |
|
|
|
|
|
Trade and other payables |
|
3,112 |
3,397 |
1,500 |
|
Bonds and loans payable |
5 |
20,904 |
1,370 |
- |
|
Provisions |
6 |
- |
- |
527 |
|
|
24,016 |
4,767 |
2,027 |
|
|
Total liabilities |
|
166,324 |
176,425 |
121,227 |
|
Net assets |
|
98,200 |
115,159 |
94,592 |
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
Share capital |
|
10,000 |
10,000 |
10,000 |
|
Special reserve |
|
82,067 |
82,067 |
83,567 |
|
Distributions proposed from special reserve |
8 |
- |
1,500 |
1,500 |
|
Foreign exchange translation reserve |
|
36,272 |
41,249 |
5,957 |
|
Accumulated loss |
|
(30,139) |
(19,657) |
(6,432) |
|
Total equity |
98,200 |
115,159 |
94,592 |
|
|
|
|
|
|
|
|
Net asset value per share |
|
98.2p |
115.2p |
94.6p |
Condensed Interim Consolidated Statement of Changes in Equity
For the six months ended 31 May 2009
|
|
|
|
Distributions |
Foreign |
|
|
|
|
|
|
Proposed |
Exchange |
|
|
|
|
Share |
Special |
From Special |
Translation |
Accumulated |
|
|
|
Capital |
Reserve |
Reserve |
Reserve |
loss |
Total |
|
|
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
At 1 December 2008 |
10,000 |
82,067 |
1,500 |
41,249 |
(19,657) |
115,159 |
|
|
|
|
|
|
|
|
|
Loss for the period |
- |
- |
- |
- |
(10,482) |
(10,482) |
|
|
|
|
|
|
|
|
|
Distributions paid on 31 December 2008 |
- |
- |
(1,500) |
- |
- |
(1,500) |
|
|
|
|
|
|
|
|
|
Currency translation differences |
- |
- |
- |
(4,977) |
- |
(4,977) |
|
At 31 May 2009 |
10,000 |
82,067 |
- |
36,272 |
(30,139) |
98,200 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Distributions |
Foreign |
|
|
|
|
|
|
Proposed |
Exchange |
|
|
|
|
Share |
Special |
From Special |
Translation |
Accumulated |
|
|
|
Capital |
Reserve |
Reserve |
Reserve |
loss |
Total |
|
|
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
Unaudited |
|
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
|
|
|
|
|
|
|
|
|
At 1 December 2007 |
10,000 |
85,067 |
- |
(2,468) |
(1,926) |
90,673 |
|
|
|
|
|
|
|
|
|
Loss for the period |
- |
- |
- |
- |
(4,506) |
(4,506) |
|
|
|
|
|
|
|
|
|
Distributions |
- |
(1,500) |
1,500 |
- |
- |
- |
|
|
|
|
|
|
|
|
|
Currency translation differences |
- |
- |
- |
8,425 |
- |
8,425 |
|
At 31 May 2008 |
10,000 |
83,567 |
1,500 |
5,957 |
(6,432) |
94,592 |
Condensed Interim Consolidated Cash Flow Statement
For the six months ended 31 May 2009
|
|
|
1 December 2008 to 31 May 2009 |
1 December 2007 to 31 May 2008 |
|
|
|
Unaudited |
Unaudited |
|
|
Notes |
£'000 |
£'000 |
|
Cash flows from operating activities |
|
|
|
|
Loss for the period before tax |
|
(10,380) |
(4,506) |
|
Adjustments for: |
|
|
|
|
Net loss on fair value adjustments on investment property |
3 |
12,744 |
6,127 |
|
Interest income |
|
(18) |
(32) |
|
Interest expense |
|
2,310 |
1,201 |
|
Loss/(Gain) on fair value adjustments on interest rate cap contracts |
|
60 |
(59) |
|
Operating cashflows before changes in working capital |
|
4,716 |
2,731 |
|
|
|
|
|
|
Decrease/(Increase) in receivables |
|
1,307 |
(257) |
|
(Decrease)/Increase in payables, provisions and security deposits from tenants |
(472) |
96 |
|
|
Decrease/(Increase) in restricted lender reserves |
|
1,265 |
(3,712) |
|
Net cash inflow/(outflow) from operating activities |
6,816 |
(1,142) |
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Purchase of investment property |
3 |
- |
(56,859) |
|
Interest received |
|
18 |
32 |
|
Net cash inflow/(outflow) from investing activities |
|
18 |
(56,827) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Proceeds from bonds and loans received |
|
- |
63,746 |
|
Redemption of bonds payable |
|
(709) |
- |
|
Distributions paid from special reserve |
|
(1,500) |
- |
|
Interest paid |
|
(2,332) |
(963) |
|
Net cash (outflow)/inflow from financing activities |
|
(4,541) |
62,783 |
|
Net increase in cash at bank |
|
2,293 |
4,814 |
|
|
|
|
|
|
Cash at bank at beginning of the period |
|
19,161 |
18,921 |
|
|
|
21,454 |
23,735 |
|
|
|
|
|
|
Effect of exchange rate fluctuations on cash at bank |
|
(1,172) |
(764) |
|
Cash at bank at end of the period |
|
20,282 |
22,971 |
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 31 May 2009
1. Basis of accounting
Basis of preparation
The condensed interim financial statements have been prepared in accordance with International Accounting Standard (IAS) 34 "Interim Financial Reporting."
The condensed interim financial statements do not include all the information and disclosures required in annual financial statements, and should be read in conjunction with the Fund's annual financial statements for the year ended 30 November 2008.
Significant accounting policies
The same accounting policies, presentation and methods of computation are followed in these condensed interim financial statements as those followed in the preparation of the Fund's annual financial statements for the year ended 30 November 2008.
Segment Reporting
The Directors are of the opinion that the Fund engaged in a single segment of business being residential investment property and in one geographical area, Japan.
2. Going concern
Having made appropriate enquiries, and bearing in mind the nature of the Fund's business and assets, the Directors have reasonable expectation that the Fund has adequate resources to continue in operational existence for the foreseeable future. The Directors have taken into consideration the following key business risks and uncertainties:
- the Fund's cash position and income generating capacity from operations and asset sales;
- potential breaches of certain loan financial covenants if there are forseeable continued reductions in property valuations; and
- pending refinancing events in 2010 which are currently being discussed with lenders
Having taken into account these risks and uncertainties, the Directors have concluded that it is appropriate to adopt the going concern basis in preparing the financial statements.
3. Investment property
|
|
1 Dec 2008 to |
1 June 2008 to |
1 Dec 2007 to |
|
|
31 May 2009 |
30 Nov 2008 |
31 May 2008 |
|
|
Unaudited |
Audited |
Unaudited |
|
|
£'000 |
£'000 |
£'000 |
|
At beginning of period |
261,707 |
185,171 |
121,270 |
|
Properties purchased |
- |
10,530 |
53,757 |
|
Acquisition costs of properties purchased |
- |
746 |
3,102 |
|
- |
11,276 |
56,859 |
|
|
Acquisition costs of properties purchased |
- |
(746) |
(3,102) |
|
Unrealised valuation (loss)/gain on current period purchases |
- |
(3,989) |
196 |
|
Unrealised valuation (loss)/gain on existing properties |
(12,744) |
(8,946) |
(3,221) |
|
Net (loss)/gain from fair value adjustments on investment property |
(12,744) |
(13,681) |
(6,127) |
|
Effect of exchange rate fluctuations on investment property |
(12,808) |
78,941 |
13,169 |
|
At end of period |
236,155 |
261,707 |
185,171 |
4. Taxation
|
|
1 Dec 2008 to |
1 Dec 2007 to |
|
|
31 May 2009 |
31 May 2008 |
|
|
Unaudited |
Unaudited |
|
|
£'000 |
£'000 |
|
(Increase)/decrease in deferred tax liability |
(102) |
334 |
|
Increase in deferred tax asset |
- |
459 |
|
|
(102) |
793 |
5. Bonds and loans payable
|
|
|
|
31 May |
30 Nov |
31 May |
|
|
|
Maturity date |
Interest rate |
2009 |
2008 |
2008 |
|
|
|
Principal |
Unaudited |
Audited |
Unaudited |
||
|
Non-current |
|
|
¥'000,000 |
£'000 |
£'000 |
£'000 |
|
Variable rate interest with no cap |
|
|
|
|
|
|
|
Mizuho Corporate Bank |
December 2010 |
1.46% |
6,094 |
39,091 |
41,196 |
28,825 |
|
Variable rate interest with cap at 4% |
||||||
|
ORIX Corporation |
June 2012 |
1.88% |
10,050 |
64,676 |
68,372 |
54,711 |
|
Fixed rate interest |
||||||
|
Mizuho Trust & Banking Corporation |
February 2010 |
- |
- |
- |
17,373 |
12,156 |
|
Mizuho Trust & Banking Corporation |
February 2010 |
- |
- |
- |
3,973 |
2,791 |
|
Tokyo Star Bank Limited |
February 2011 |
3.03% |
2,709 |
17,402 |
18,460 |
12,814 |
|
Tokyo Star Bank Limited |
February 2011 |
3.00% |
700 |
4,535 |
4,770 |
3,311 |
|
Tokyo Star Bank Limited |
April 2011 |
3.09% |
246 |
1,594 |
1,676 |
1,164 |
|
Tokyo Star Bank Limited |
May 2011 |
3.37% |
568 |
3,680 |
3,870 |
2,685 |
|
Tokyo Star Bank Limited |
June 2011 |
3.44% |
1,174 |
7,606 |
8,000 |
- |
|
Tokyo Star Bank Limited |
June 2011 |
3.27% |
347 |
2,248 |
2,364 |
- |
|
|
|
|
21,888 |
140,832 |
170,054 |
118,457 |
|
Current |
|
|
|
|
|
|
|
Variable rate interest with cap at 4% |
|
|||||
|
ORIX Corporation |
November 2009 |
1.88% |
100 |
648 |
1,370 |
- |
|
Fixed rate interest |
|
|
|
|
|
|
|
Mizuho Trust & Banking Corporation |
February 2010 |
2.24% |
2,570 |
16,473 |
- |
- |
|
Mizuho Trust & Banking Corporation |
February 2010 |
2.32% |
590 |
3,783 |
- |
- |
|
|
|
|
3,260 |
20,904 |
1,370 |
- |
|
|
|
|
25,148 |
161,736 |
171,424 |
118,457 |
The bonds and loans payable are secured by investment properties with a fair market value of ¥33,214 million (£215 million) at the balance sheet date.
6. Provisions
|
|
31 May |
31 Nov |
31 May |
|
|
2009 |
2008 |
2008 |
|
|
Unaudited |
Audited |
Audited |
|
|
£'000 |
£'000 |
£'000 |
|
At beginning of period |
- |
527 |
482 |
|
Utilised during the period |
- |
(514) |
- |
|
Exchange differences |
- |
(13) |
45 |
|
At end of period |
- |
- |
527 |
7. Related party transactions
The Directors of the Company received fees for their services. The total charge to the income statement during the period was £59,000 all of which had been paid at the end of the period.
The Fund pays fees to KKHML for its management services. The total charge to the income statement during the period was £25,000 of which £12,500 was outstanding at the end of the period. Paul Hammerstad, a director of the Company, is also a director of KKHML.
The Japan-domiciled firms in which the Company is the ultimate beneficiary pay fees to KKHAM for its investment advisory services. The total charge to the income statement during the period was £772,031 of which £10,005 was outstanding at the period end. Paul Hammerstad, a director of the Company, is also a director of KKHAM.
8. Distributions
On 31 December 2008 a distribution of £1.5 million was paid out of the Special Reserve.
9. Commitments
The Fund did not have any capital commitments at the balance sheet date (2008: ¥2,851million (£13.7 million))
Related Shares:
JRIC.L