18th Aug 2009 07:00
Wichford P.L.C.
("Wichford" or the "Company")
Interim Management Statement
18 August 2009
The Board of Wichford P.L.C., the property investment company, issues the following Interim Management Statement relating to the quarter ended 30 June 2009.
Quarter to 30 June 2009
Negotiations on sales resulted in three completions post the quarter end as well as re-letting of vacant space at Osprey House, Redditch.
The Company continues to make profits from its Trading Operations. Occupancy remained above 99% producing a stable income stream and interest costs were largely unchanged as a result of fixed rate borrowings.
Rights Issue
On 5 August 2009, the Company announced a fully underwritten 7 for 1 Rights Issue to raise proceeds of approximately £52.2 million, net of expenses, by the issue of 929,333,636 New Shares at a price of 6 pence per New Share. The Rights Issue is subject to approval by Shareholders at a General Meeting to be held on 28 August 2009.
A Prospectus in relation to the Rights Issue has been sent to Shareholders and is available on the Company's website www.wichford.com.
Interim Dividend
The Rights Issue has enabled the Board to determine an appropriate level of interim dividend for the period to 31 March 2009. Subject to completion of the Rights Issue, the interim dividend will be 3 pence per share payable to Shareholders on the register on 14 August 2009 and to be paid on 28 September 2009.
Property Portfolio
Valuations
As part of the Rights Issue process, the Company had the property portfolio valued as at 30 June 2009. The Company's UK property portfolio declined 1.2% since 31 March 2009 with the Company's Continental European portfolio declining 1.0% in local currency over the same period. The rate of decline has slowed substantially in comparison to the first half of the financial year. Net initial yields for the UK Core portfolio remained broadly unchanged at 7.65% (March 2009, 7.67%) reflecting the demand for secure long-term income.
The Board is of the view that the more marked outperformance of the Company's UK portfolio against the UK IPD All Office index since March 2009 (on a like-for-like basis) is a reflection of the Company's secure income stream, negligible voids and low average rents against a general property market backdrop of declining rental values and increasing voids.
Lettings
9,696 sqft of vacant space has been let at Osprey House, Redditch resulting in a rent of £86,294 p.a. and the elimination of the vacant rates charge.
Sales
Post 31 March 2009, sales have been completed on Britannic Way (Neath) Saxon House (Worthing) and Trentside (Nottingham) - all at or above the 31 March 2009 valuations. In addition, agreements for sale have been exchanged on Newport Road (Cardiff) and Jefferson House (Leeds). These sales reflected opportunities to dispose of shorter dated leases in respect of which future lettings or extensions are uncertain (Saxon and Jefferson House) or where rental and capital growth prospects are limited.
Proceeds from the sales are expected to be approximately £19.8m and form part of a sales and acquisitions strategy to achieve an extension of the Gamma and Delta financing facilities.
Finance
It was reported in the half yearly financial statements that there was no default under the VBG1 and VBG2 facilities despite the reported loan to value ratios exceeding the maximum allowed under the facilities financial covenants. The status of these facilities remains unchanged. The Company is in ongoing discussions with the facility servicer.
Outlook
There has been evidence in recent months of greater stability in capital values, particularly where longer leases and strong covenants are evident. The Company's income stream is expected to remain robust and the proposed Rights Issue, if approved, will enable acquisitions that in turn will enable the resolution of upcoming debt maturities.
Philippe de Nicolay, Chairman of Wichford, commented:
"I continue to believe in the strength and stability of Wichford's portfolio, its stable income stream and negligible vacancy rates. The proceeds of the Rights Issue will strengthen the Group's balance sheet and I look forward to reporting on the Company's progress later in the year."
For further details, please contact,
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Wichford P.L.C. |
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Philippe de Nicolay |
00 33 1 40 74 42 79 |
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Wichford Property Management Ltd |
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Michael Watters |
020 7811 0100 |
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Philip Cooper |
020 7495 7111 |
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Stephen Oakenfull |
020 7811 0100 |
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Citigate Dewe Rogerson |
020 7638 9571 |
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George Cazenove |
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Hannah Seward |
Related Shares:
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