28th Sep 2007 07:02
Alpha Tiger Property Trust Limited28 September 2007 28 September 2007 ALPHA TIGER PROPERTY TRUST LIMITED ("ALPHA TIGER" OR THE "TRUST" OR THE "COMPANY") ALPHA TIGER ANNOUNCES AND POSTS MAIDEN INTERIM RESULTS Alpha Tiger, the property company established for the purposes of investing inand developing real estate in India, today announces its maiden interim resultscovering the period from incorporation to 30 June 2007. The Trust listed on AIMon 21 December 2006, raising £75 million. The Trust announced a profit after interest and tax of £1.05 million (EPS 1.4pence). Highlights of the period to 30 June 2007 include: • NAV per ordinary share 97.5 pence up 1.8 per cent. since admission to AIM (95.8 pence) • Execution of a legally binding framework agreement with Xansa Plc ('Xansa') incorporating the: o purchase of 40 acres of development land o sale and leaseback of Xansa's real estate interests in India o appointment of Alpha Tiger as Xansa's preferred real estate supplier in India • Equity commitments (following refinancing) of £43 million representing 59% of funds raised at flotation • Significant expansion of pipeline opportunities - potentially involving in excess of 3 million sq. ft. of real estate • Establishment of key local Indian partnership relationships David Jeffreys, Chairman of Alpha Tiger, commented: "The Trust is delighted to have announced the landmark transaction with Xansawhich commits nearly 60% of funds raised upon AIM admission. The Xansa assets,in addition to providing a high quality tenant, offer significant developmentopportunities of up to 3.4 million square feet in prime real estate locations inPune and Chennai. Alpha Tiger intends to commit a total of £75 million of equityand debt to acquire and develop these sites. Tiger will be providing a highquality, long term solution for Xansa's occupational requirements in India,allowing Xansa to grow with greater flexibility, speed and at lower risk. AlphaTiger looks forward to delivering the business parks for Xansa and other leadinginternational companies in India. We continue to develop our existing pipelinetogether with key local Indian relationships and we are advancing a number ofnew transactions." The Investment Manager to Alpha Tiger is Alpha Real Capital LLP.For further information please contact: David Jeffreys, Chairman, Alpha Tiger +44 (0) 1481 723 450 Brad Bauman, Fund Manager, Alpha Tiger +44 (20) 7591 1615 (UK) +91 9980 00 11 22 (India) Phillip Rose, CEO, Alpha Real Capital +44 (20) 7591 1609 Edward Orlebar, M:Communications +44 (20) 7153 1523 Notes to Editors: About Alpha Tiger Property Trust Alpha Tiger is a Guernsey registered closed-ended investment company investingin and developing Indian real estate. It floated on AIM in December 2006,raising £75 million. Further information is available at www.alphatigerpropertytrust.com About Alpha Real Capital LLP Alpha Real Capital is a value-adding international property fund managementgroup. Alpha Real Capital was established by Phillip Rose and Sir John Beckwith. Alpha Real Capital is the Investment Manager to Alpha Tiger. Alpha RealCapital's Indian CEO, Brad Bauman, is Fund Manager to Alpha Tiger. He has 18years' experience in the real estate and finance industries, and has beenresponsible for Alpha Real Capital's Asian investment programme since 2005. For more information on Alpha Real Capital please visit www.alpharealcapital.com ALPHA TIGER PROPERTY TRUST LIMITEDINTERIM RESULTS For the period 15 May 2006 to 30 June 2007 These are not the Company's statutory financial statements. Trust Summary and Objective Objective Alpha Tiger Property Trust Limited ("the Trust" or "Alpha Tiger" or "the Company") has been formed in order to invest in and develop real estate in India thatwill offer high total returns. Alpha Tiger's current intention is that businessparks and business park-led mixed use projects will form the core of itsportfolio. Capital structure The Trust raised initial shareholder equity of £75 million before expenses andlisted on AIM (the Alternative Investment Market) on 21 December 2006. The Trustintends to borrow in due course to optimise returns for investors. Management The Trust is a closed-ended Guernsey registered investment company. Control ofthe Trust rests with the non-executive Guernsey-based Board of Directors. TheTrust's Investment Manager is Alpha Real Capital LLP ("the Investment Manager"). Financial Highlights 30 June 2007Net asset value (£'000) 73,121Net asset value per ordinary share 97.5pOrdinary share price 99.0pEarnings per share (basic and diluted) 1.4p Chairman's statement I am pleased to report the Company's results for the period from incorporationto 30 June 2007. Alpha Tiger was established for the purposes of investing in and developing realestate in India. The Trust's objective is to target investment and developmentopportunities in real estate in India that will offer high total returns. TheTrust's investment strategy includes both property investment and development,focussing on business parks and business-park led mixed use properties andtownship projects. The Trust seeks to diversify risk through investments in existing real estate,forward funding of development opportunities and development partnerships onboth a pre-committed and speculative basis. The Trust is targeting a geographicspread of properties across India with a variety of tenants with strongcovenants. Alpha Tiger seeks to work closely with international occupiers and local realestate companies in order to access land and transition it, through thedevelopment process, up the property value and quality curve. Alpha isprogressing a number of potential transactions and partnerships creating areasonably priced land bank to deliver a number of key benefits to stakeholders: • higher-quality, higher-specification commercial space at competitive rents for Alpha Tiger's tenants; • increased development flexibility in terms of the scale, mix and timing of development for the benefit of both tenants and the communities in which Alpha Tiger participates; and • strong future profitability for investors. Investment activity The Company has conditionally agreed to acquire from Xansa plc approximately 40acres of development land and six investment properties in Chennai, Pune andNoida for up to £36 million, with the capacity to develop up to 3.4 millionsq.ft. of new business park space. The Company currently intends to initiallycommit up to £40 million of additional capital to build 1.7 million sq.ft. ofhigh-quality business park space. Alpha Tiger will initially finance the investment properties with equity andrefinance at 50% of gross asset value with third party debt in due course. The40 acres of development land will be financed with equity. Alpha intends totarget borrowing levels on developments at 60% of construction cost. Inaggregate, the initial commitment following refinancing will requireapproximately £43 million of equity, representing over 50% of the net proceedsraised at flotation. The purchase price for the investment properties of approximately £19 million isbased on an initial rental yield of approximately 11% with 15% rental upliftsevery three years. The purchase price for the development land is approximately£17 million. The Investment Manager is evaluating additional investment with potential Indianpartners and international companies, which could involve in excess of 3 millionsq.ft. of real estate. Results, finance and dividends Results for the period show an adjusted profit after interest and tax of £1.051million or 1.4p per share. The adjusted net asset value per share was 97.5p at 30 June 2007. During the period under review, the Trust retained the net funds raised ondeposit in Sterling. The Trust has no existing borrowings but expects to target borrowing levels ofbetween 50% and 65% of gross assets in due course. In accordance with the dividend policy set out in the Trust's AdmissionDocument, the Board does not propose an interim dividend. The Board willconsider the payment of a dividend as the Trust's development programme matures. Economic outlook India is the fourth largest economy in the world after the United States, Chinaand Japan as measured by purchasing power parity (PPP) with gross domesticproduct (GDP) in 2006 estimated to be USD 4.0 trillion. India is also the secondfastest growing major economy in the world. Between 2004-06, GDP grew at anaverage of 8.5% p.a. The growth momentum has accelerated further and is expectedto remain strong at 9.2% in 2007, making this the fastest growing year in termsof GDP in recent Indian history. This growth is a function of India's stablepolitical outlook, growing foreign exchange reserves, sustained growth inservices and industrial sectors, young demographic profile and regulatedfinancial environment. As a result of this robust outlook, India continues to bean attractive investment destination. The services sector, which includes among others, the IT, construction and realestate sectors, is the fastest growing sector in the Indian economy. In 2007,growth in this sector is expected to be 11.2%. Property market outlook Investment yields have remained constant despite higher interest rates and moreconservative bank lending policies. The Investment Manager continues to see attractive opportunities for investingin Indian real estate, particularly business park developments. Generally, botheconomic and property market conditions remain favourable with strong andgrowing tenant demand keeping pace with increasing availability of stock. Inparticular, there remains a significant market opportunity for higher-quality,operationally efficient business park space that meets the internationalstandards of global occupiers. The Trust is focussed on this opportunity, asdemonstrated by the major commitment made to meeting Xansa's occupationalrequirements in India. Summary Looking ahead, Alpha Tiger remains focused on completing the announcedtransactions and further advancing the current pipeline. David JeffreysChairman Property Investment Review Investment and portfolio review Alpha Tiger has established a very strong base for future growth. The Trust'spipeline has been further strengthened by forging promising relationships withleading local development partners demonstrating world-class execution and withinternational investors. The Trust announced on 29 May 2007 a framework agreement with Xansa, a leadingoutsourcing and technology company, to purchase 40 acres of development land andthe sale and leaseback of Xansa's real estate interests in India. The agreementalso appoints Alpha Tiger as Xansa's preferred real estate supplier in India tofacilitate best-in-class development and management of the properties. On 31 July 2007 Xansa announced a merger with Groupe Steria SCA and this will,in the opinion of the Investment Manager, improve the potential opportunity forthe Trust, as a strategic real estate supplier for Xansa's continuing businessexpansion in India. Investment Properties Noida (Delhi NCR) The properties in Noida consist of two separately located office buildings; onetwo-storey building (with ground and basement level) over 42,000 sq. ft. offloor area; and a four storey building (with ground and two basement levels)over 180,000 sq. ft. of floor area. Pune The property in Pune comprises two two-storey buildings (Phase I with basement,ground floor, first floor, and canteen; Phase II with two basements, groundfloor, and first floor), in a campus-style setting with a combined floor area ofover 95,000 sq. ft. Chennai (Madras) The property in Chennai is a campus-style development with two buildingsrepresenting a floor area of over 165,000 sq. ft. Development Land Chennai - 25 acres The Chennai site is a long leasehold with development rights over 25 acres ofundeveloped land (with SEZ approval, subject to notification) providingdevelopment potential for approximately 2.2 million sq .ft. of floor space. Itis intended that the site will be developed in four phases over four to fiveyears. Pune - 15.7 acres The Pune site is a long leasehold with development rights over approximately15.7 acres. This site has the ability to develop up to an additional area ofapproximately 1.2 million sq. ft. of floor space. The intention is to developthis site in three phases over three to four years. Brad Bauman For and on behalf of the Investment Manager Independent Review Report to Alpha Tiger Property Trust Limited Introduction We have been engaged by the Company to review the condensed set of financialstatements in the interim financial report for the period ended 30 June 2007which comprises the condensed balance sheet and the related condensed statementsof income, changes in equity and cash flows. We have read the other informationcontained in the interim financial report and considered whether it contains anyapparent misstatements or material inconsistencies with the information in thecondensed set of financial statements. Directors' responsibilities The interim financial report is the responsibility of, and has been approved by,the Directors. As disclosed in note 2, the annual financial statements of theGroup are prepared in accordance with IFRSs as adopted by the European Union.The condensed set of financial statements included in this interim financialreport has been prepared in accordance with International Accounting Standard34, 'Interim Financial Reporting', as adopted by the European Union. Our responsibility Our responsibility is to express to the Trust a conclusion on the condensed setof financial statements in the interim financial report based on our review. Scope of review We conducted our review in accordance with International Standard on ReviewEngagements (UK and Ireland) 2410, 'Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity' issued by the AuditingPractices Board for use in the United Kingdom. A review of interim financialinformation consists of making enquiries, primarily of persons responsible forfinancial and accounting matters, and applying analytical and other reviewprocedures. A review is substantially less in scope than an audit conducted inaccordance with International Standards on Auditing (UK and Ireland) andconsequently does not enable us to obtain assurance that we would become awareof all significant matters that might be identified in an audit. Accordingly, wedo not express an audit opinion. Conclusion Based on our review, nothing has come to our attention that causes us to believethat the condensed set of financial statements in the interim financial reportfor the period 15 May 2006 to 30 June 2007 is not prepared, in all materialrespects, in accordance with International Accounting Standard 34 as adopted bythe European Union. BDO Novus LimitedChartered AccountantsElizabeth House St Peter PortGuernsey GY1 3LL 27 September 2007 Condensed Company Income StatementFor the period from 15 May 2006 to 30 June 2007 Notes Revenue Capital Total £'000 £'000 £'000 RevenueBank interest receivable 2,045 - 2,045 ExpensesProfessional fees 43 - 43Investment Manager's fee 758 - 758Non-executive directors' fees 58 - 58Administration costs 135 - 135Total expenses 994 - 994 Net profit before taxation 1,051 - 1,051 Taxation - - - Profit for the period 1,051 - 1,051 Earnings per share - basic and diluted 4 - - 1.4p The total column of this statement represents the Trust's income statement,prepared in accordance with IFRS. The revenue and capital columns are suppliedas supplementary information permitted under IFRS. All items in the abovestatement derive from continuing operations. The accompanying notes are an integral part of this statement. Condensed Company Balance SheetAt 30 June 2007 Notes £'000 Current AssetsTrade and other receivables 5 750Cash and cash equivalents 72,768 Total assets 73,518 Current liabilitiesTrade and other payables 6 397 Net assets 73,121 EquityShare capital 7 -Share premium account -Special reserve 72,030Warrant reserve 40Revenue reserve 1,051 Total equity 73,121 Number of ordinary shares 75,000,000Net asset value per ordinary share 97.5p The financial statements were approved by the Board of Directors and authorisedfor issue on 27 September 2007. They were signed on its behalf by David Jeffreysand Serena Tremlett. The accompanying notes are an integral part of this statement. Condensed Company Cash Flow StatementFor the period from 15 May 2006 to 30 June 2007 £'000 Net profit before taxation 1,051 Adjustments for: Increase in operating trade and other receivables (241) Increase in operating trade and other payables 397 Net cash inflow from operating activities 1,207 Cash flows from investing activitiesAcquisition costs - deposit paid (509) Net cash outflow from investing activities (509) Cash flows from financing activities Proceeds from issue of ordinary share capital 75,000 Issue costs (2,930) Net cash inflow from financing activities 72,070 Net increase in cash and cash equivalents 72,768 Cash and cash equivalents at beginning of period - Cash and cash equivalents at end of period 72,768 The accompanying notes are an integral part of this statement. Condensed Company Statement of Changes in EquityFor the period from Share Share Special Warrant Revenue Total15 May 2006 to capital premium £'000 reserve reserve reserve reserves30 June 2007 £'000 £'000 £'000 £'000 £'000 Changes in equity for the period Profit for the period - - - - 1,051 1,051 Total recognised income and expense for the period - - - - 1,051 1,051 Issue of share capital - 75,000 - - - 75,000Share issue costs - (2,930) - - - (2,930) Transfer to special reserve - (72,030) 72,030 - - - Share based payments - (40) - 40 - - At 30 June 2007 - - 72,030 40 1,051 73,121 The accompanying notes are an integral part of this statement. Notes to the Interim Condensed Financial Statements 1. General information The Trust is a limited liability, closed-ended investment company incorporatedin Guernsey on 15 May 2006. The nature of the Trust's operations and itsprincipal activities are set out in the Chairman's statement. The interimfinancial statements were authorised for issue on 27 September 2007 by DavidJeffreys and Serena Tremlett on behalf of the Board. These condensed interim financial statements are presented in Sterling as thisis the currency in which the funds were raised and in which investors areseeking a return. The Company's reporting currency is Sterling. 2. Significant accounting policies The unaudited condensed interim financial statements of the Company have beenprepared in accordance with International Accounting Standard 34 ("IAS 34"), 'Interim Financial Reporting'. The condensed interim financial statements are made up from 15 May 2006 to 30June 2007 and have been prepared under the historical cost convention. The preparation of the interim condensed financial statements requires theDirectors to make estimates and assumptions that affect the reported amounts ofrevenue, expense, assets and liabilities, and the disclosure of contingentliabilities at the date of the condensed interim financial statements. If infuture such estimates and assumptions, which are based on the Directors' bestjudgements at the date of the interim condensed financial statements, theoriginal estimates will be modified as appropriate in the period in which thecircumstances change. The principal accounting policies adopted are set out below. Presentation of income statement In order to better reflect the activities of the Company and in accordance withguidance issued by the Association of Investment Companies ("AIC"),supplementary information which analyses the income statement between the itemsof a revenue and capital nature has been presented alongside the incomestatement. Revenue recognition Interest income is accrued on a time basis by reference to the principaloutstanding and the effective interest rate applicable. Foreign currencies Transactions in currencies other than pounds Sterling are recorded at the ratesof exchange prevailing on the dates of the transactions. At each Balance Sheetdate, monetary assets and liabilities that are denominated in foreign currenciesare retranslated at the rates prevailing on the Balance Sheet date. Non-monetaryassets and liabilities are carried at fair value; those that are denominated inforeign currencies are translated at the rates prevailing at the date when thefair value was determined. Gains and losses arising on retranslation areincluded in net profit or loss for the period, except for exchange differencesarising on non-monetary assets and liabilities where the changes in fair valueare recognised directly to equity. Expenses All expenses are accounted for on an accruals basis and include those of theAdministrators, the Investment Manager and the Directors. Taxation The Company is exempt from Guernsey taxation on income derived outside ofGuernsey and bank interest earned in Guernsey under the Income Tax (ExemptBodies) (Guernsey) Ordinance, 1989. A fixed annual fee of £600 is payable to theStates of Guernsey in respect of this exemption. No charge to Guernsey taxationarises on capital gains. Dividends Dividends are recognised as a liability in the period in which they becomeobligations of the Trust. Segmental reporting The Directors are of the opinion that the company is engaged in a single segmentof business being property investment business. It operates in a singlegeographical segment (India). Share-based payments The company makes equity-settled share-based payments to certain advisers andservice providers. Equity-settled share-based payments are measured at fairvalue as at the date of grant. The fair value determined at grant date isexpensed on a straight line basis over the vesting period, based on thecompany's estimate of the number of instruments that will eventually vest. Trade and other receivables Trade and other receivables do not carry any interest and are short-term innature and are accordingly stated at their nominal value as reduced byappropriate allowances for estimated irrecoverable amounts. Cash and cash equivalents Cash in banks and short term deposits that are held to maturity are carried atcost. Cash and cash equivalents consist of cash in hand and short term depositsin banks with an original maturity of three months or less. Trade and other payables Trade payables and other payables are non interest-bearing and are stated attheir nominal value. Financial liabilities and equity instruments Financial liabilities and equity instruments are classified according to thesubstance of the contractual arrangements to which they relate. An equityinstrument is any contract that evidences a residual interest in the asset ofthe Company after deducting all of its liabilities. Financial liabilities andequity instruments are recorded at the proceeds received, net of issue costs. 3. Dividends In accordance with the policy set out in the Trust's AIM Admission Document, nodividend has been declared for the period to 30 June 2007. 4. Earnings per share The calculation of the basic and diluted earnings per share is based on thefollowing data: Period 15 May Period 15 May Period 15 May 2006 2006 2006 to to to 30 June 2007 30 June 2007 30 June 2007 Revenue Capital Total Earnings (£'000)Earnings for the purposes of basic and diluted earnings per share 1,051 - 1,051 Number of shares (000's)Weighted average number of ordinary shares for the purposes of basic earnings per share 75,000 - 75,000 Basic earnings per share 1.4p - 1.4p 5. Trade and other receivables 30 June 2007 £'000 Bank interest receivable 241Other debtors 509 Total 750 Other debtors include the deposit paid to Xansa plc in relation to the executionof the framework agreement (£0.5m). 6. Trade and other payables 30 June 2007 £'000 Investment Manager's fee payable 363Accruals 34 Total 397 7. Share capital No. £'000 AuthorisedOrdinary shares of no par value Unlimited - Issued Share CapitalAt 15 May 2006 - -Ordinary shares of no par value issued in the period 75,000,000 -At 30 June 2007 75,000,000 - The Trust has one class of ordinary shares which carry no right to fixed income. 8. Related party transactions Parties are considered to be related if one party has the ability to control theother party or exercise significant influence over the other party in makingfinancial or operational decisions. Alpha Real Capital LLP is the InvestmentManager to the Trust under the terms of the Investment Manager Agreement and isthus considered a related party of the Trust. The Investment Manager is entitled to receive a fee from the Trust at an annualrate of 2 per cent of the net assets of the Trust, payable quarterly in arrears.The Investment Manager is also entitled to receive an annual performance feecalculated with reference to total shareholder return ("TSR"), whereby the feeis 20 per cent of any excess over an annualised TSR of 15 per cent subject to ahigh water mark. Details of the investment management fees for the currentaccounting period are given in the condensed income statement and the balancepayable at the balance sheet date is shown in note 6. The Investment Manager has also been issued warrants over the Trust's ordinaryshare capital, further details of which are provided in note 9. The Directors of the Trust received fees for their services with a total chargeto the income statement during the period of £58,315. The Investment Manager received payment of £300,000 in respect of time costs andexpenses incurred by the Investment Manager in connection with the initialplacing and admission to AIM. Pacific Investments plc, a company controlled by Sir John Beckwith, who alsocontrols the Investment Manager, was paid £150,000 in respect of theirprofessional costs and expense in connection with the initial placing andadmission to AIM. 9. Share based payments Warrants The Trust has issued warrants to the Investment Manager pursuant to which it hasbeen granted the right to subscribe for 3,750,000 ordinary shares in the Trustat an exercise price of £1 per share. Such warrants can be exercised at any timeup to and including 21 December 2011. The warrant instrument provides that theholder of the warrant may from time to time transfer all or some of its warrantsto third parties. The fair value of the warrants at grant date has been measured as £39,553 usingan appropriate option pricing model. In light of the immaterial amount of thefair value the directors do not consider it worthwhile to disclose theassumptions used in determining this fair value. Directors and Trust information Directors: Nominated Advisor Legal Advisors in Guernsey: David Jeffreys (Chairman) Panmure Gordon (Broking) Limited Carey OlsenJeff Chowdhry Moorgate Hall 7 New StreetRoddy Sage 155 Moorgate St Peter PortPhillip Rose London EC2M 6XB Guernsey GY1 4BZSerena Tremlett Independent Valuers: Legal Advisors in the UK: Colliers International (Hong Kong) Limited Norton RoseRegistered Office: Suite 5701 Central Plaza 3 More London Riverside 18 Harbour Road London SE1 2AQRegency Court Wanchai, Hong KongGlategny EsplanadeSt Peter PortGuernsey GY1 1WW Bankers in Guernsey: Financial and Corporate Advisors: Royal Bank of Scotland Kinmont Limited International LimitedInvestment Manager: 6 Arlington Street Royal Bank Place London SW1A 1RE 1 Glategny EsplanadeAlpha Real Capital LLP St Peter Port124 Sloane Street Guernsey GY1 4BQLondon SW1X 9BW Auditors: BDO Novus Limited Registrar:Administrator and Secretary: Elizabeth House Ruette Braye Computershare Investor ServicesInternational Administration St Peter Port (Channel Islands) Limited(Guernsey) Limited Guernsey GY1 3LL Ordnance HouseRegency Court 31 Pier RoadGlategny Esplanade St HelierSt Peter Port Jersey JE4 8PWGuernsey GY1 3RH Tax Advisors: Ernst & Young LLP 1 More London Place London SE1 2AF This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Alpha Real