12th Jan 2010 07:00
STANDARD LIFE INVESTMENTS PROPERTY INCOME TRUST LIMITED
31 December 2009
Key Highlights
Net asset value per ordinary share was 56.6p as at 31 December 2009, an increase of 10.4% from 30 September 2009
Cash held by the Trust of £30.8m as at 31 December 2009
Loan to value of 39.2% after cash balances offset against debt
Dividend yield of 6.4% using the share price as at 8 January 2010 of 62.5p
6.15m ordinary shares issued between 6 and 13 November 2009 at prices between 54.25 and 55.25p per share.
Net Asset Value
The unaudited net asset value per ordinary share of Standard Life Investments Property Income Trust Limited at 31 December 2009 was 56.6 pence. This is an increase of 10.4% percentage points over the net asset value of 51.3 pence per share at 30 September 2009.
The net asset value is calculated under International Financial Reporting Standards ("IFRS") and includes a provision for payment of an interim dividend of 1.00p per ordinary share for the quarter to 31 December 2009.
The net asset value incorporates the external portfolio valuation by Jones Lang LaSalle at 31 December 2009. The property portfolio will next be valued by an external valuer during March 2010 and the next quarterly net asset value will be published thereafter.
Breakdown of NAV movement
Set out below is a breakdown of the change to the unaudited net asset value per share calculated under IFRS over the period 30 September 2009 to 31 December 2009.
|
Pence per share |
% of opening NAV |
|
|
Net Asset Value per share as at 30 September 2009 |
51.3 |
- |
|
Unrealised gain following revaluation of property portfolio (including the effect of gearing) |
2.3 |
4.5% |
|
Increase in interest rate swap valuation |
0.2 |
0.4% |
|
Other movement in reserves |
2.8 |
5.5% |
|
Net Asset Value per share as at 31 December 2009 |
56.6 |
10.4% |
Cash position
As at 31 December 2009 the Company had borrowings of £84.4m and a cash position of £30.8m (excluding rent deposits) therefore cash as a percentage of debt was 36.5%.
Loan to value ratio
As at 31 December 2009 the loan to value ratio (assuming all cash is placed with RBS as an offset to the loan balance) was 39.2% (30 September 2009: 42.1%). The covenant level is 65%.
Total asset analysis as at 31 December 2009 (unaudited)
|
£m |
% |
|
|
Office |
64.3 |
38.0 |
|
Retail |
22.7 |
13.4 |
|
Industrial |
37.7 |
22.3 |
|
Other |
12.1 |
7.1 |
|
Total Property Portfolio |
136.8 |
80.8 |
|
Cash |
30.8 |
18.2 |
|
Other Assets |
1.6 |
1.0 |
|
Total Gross Assets |
169.2 |
100.0 |
Breakdown in valuation movements over the period 30 September 2009 to 31 December 2009
|
Exposure as at 31 December 2009 (%) |
Capital Value Movement on Standing Portfolio (%) |
£m |
|
|
External Valuation at 30/09/09 |
123.1 |
||
|
Sub Sector Analysis: |
|||
|
RETAIL |
|||
|
South East Standard Retail |
4.7 |
12.3 |
0.7 |
|
Retail Warehouses |
11.9 |
0.3 |
0.1 |
|
OFFICES |
|||
|
Central London Offices |
9.3 |
5.4 |
0.6 |
|
South East Offices |
18.5 |
13.1 |
2.9 |
|
Rest of UK Offices |
11.3 |
5.4 |
0.8 |
|
INDUSTRIAL |
|||
|
South East Industrial |
6.0 |
0.3 |
0.0 |
|
Rest of UK Industrial |
21.6 |
1.0 |
0.3 |
|
OTHER |
8.8 |
(18.2) |
(2.7) |
|
Northern & Shell Tower, London |
7.9 |
11.0 |
|
|
External Valuation at 31/12/09 |
100 |
11.1 |
136.8 |
Investment Manager Commentary
The period from 30 September 2009 to 31 December 2009 saw an acceleration in the recovery of prices in the UK commercial property market, and marks the third consecutive quarter of positive total returns from the investment portfolio.
In addition to the improvement in capital values (the property portfolio valuation rose by 4.5% over the quarter) the Company had an active quarter with asset management and investment transactions.
During the quarter the Company made its second property acquisition of 2009, an office block in the Docklands. The property is let for a further 13 years to a good covenant and the purchase reflected a yield of 8.6%. The property was valued at the end of December 9% above the purchase price.
The Company accepted a surrender of a lease of a cinema unit, and simultaneously relet the unit on a longer lease to a better covenant. The new rent is substantially lower than under the old lease (it was the most over rented lease in the portfolio) but the Company received a substantial premium of £3.3m from the outgoing tenant as compensation. It is this premium, along with the share issue mentioned below, that dominated the "other movement in reserves" detailed in the breakdown of the NAV above.
Perhaps reflective of the wider economic recovery seen over the quarter the Company was successful in letting two floors of offices in Clerkenwell London - both within days of completing a minor refurbishment, and also two shop units in North London, one of them to Sainsbury, a new tenant for the Company.
The shares issued over the quarter (1.75m @ 55.25p, and 4.4m @ 54.25p) were accretive to the end Sept NAV of 51.3p, and mean that all of the block listing under the TAP issue has been taken up. The cash raised over the quarter through the share issue and asset management transactions means that despite the new acquisition for £10m the Company's cash has only reduced by £2m. We continue to look for suitable investments to utilise the cash.
All Enquiries:
The Company Secretary
Northern Trust International Fund Administration Services (Guernsey) Ltd
Trafalgar Court
Les Banques
GY1 3Q1
Tel: 01481 745324
Fax: 01481 745085
APENDIX 1
Historical adjusted IFRS NAVs per Ordinary Share are as follows:
|
31/12/09 |
56.63p |
|
|
30/09/09 |
51.28p |
|
|
30/06/09 |
50.53p |
|
|
31/03/09 |
52.49p |
|
|
31/12/08 |
61.65p |
|
|
30/09/08 |
87.24p |
|
|
30/06/08 |
101.59p |
|
|
31/03/08 |
102.71p |
|
|
31/12/07 |
111.60p |
|
|
30/09/07 |
130.70p |
|
|
30/06/07 |
137.16p |
|
|
31/03/07 |
134.42p |
|
|
31/12/06 |
132.68p |
|
|
30/09/06 |
129.51p |
|
|
30/06/06 |
130.20p |
|
|
31/03/06 |
124.28p |
|
|
31/12/05 |
116.46p |
|
|
30/09/05 |
107.12p |
|
|
30/06/05 |
103.88p |
|
|
31/03/05 |
101.34p |
|
|
31/12/04 |
99.00p |
Related Shares:
SLI.L