TIDMEBOX TIDMBOXE
RNS Number : 9176Y
Tritax EuroBox PLC
18 May 2021
18 May 2021
Tritax EuroBox plc
(the "Company")
RESULTS FOR THE SIX MONTHSED 31 MARCH 2021
Tritax EuroBox plc (ticker: EBOX (Sterling) and BOXE (Euro)),
which invests in a high-quality portfolio of very large, prime
logistics real estate assets strategically located across
continental Europe, is today reporting its results for the six
months ended 31 March 2021.
Financial performance 31 March 2021 30 September Increase/
As at 2020 (decrease)
Portfolio value EUR841.6m EUR837.9m 0.45%(1)
IFRS NAV per share EUR1.22 EUR1.19
Loan to value ( " LTV " )(2)
ratio 25.0% 39.9% 14.9 pts
Six months to 31 March 2021 31 March 2020
Dividend per share 2.50 cents 2.20 cents 13.6%
Profit before tax EUR41.2m EUR27.8m 48.2%
Basic earnings per share
( " EPS " )(3) 7.32 cents 5.32 cents 37.6%
Adjusted EPS(3) 2.30 cents 2.25 cents 2.2%
Financial highlights: strong performance and growing
dividend
-- Dividends declared in respect of the period of 2.50 cents per
share, up 13.6% (H1 2020: 2.20 cents)
-- Raised gross proceeds of EUR230 million, through a
significantly oversubscribed equity issue
-- Received a Fitch BBB- investment grade credit rating in March
2021, immediately reducing our cost of debt and opening up new
sources of debt financing
-- Portfolio independently valued at EUR843.4 million at the
period end (30 September 2020: EUR839.3 million), a like-for-like
increase of 3.4%
-- 100% of rent due for the period collected, with rent deferred
from the 2019/20 financial year being collected as per agreed
schedule
-- Debt of EUR260.0 million at the period end, giving an LTV
ratio of 25.0% (30 September 2020: EUR344.0 million and 39.9%)
Operational highlights: Further strategic progress
-- Acquired one prime logistics asset in Nivelles, Belgium, for EUR31.2 million
-- Extracted value from the portfolio, including:
-- Disposing of the asset at Lodz, Poland, for EUR65.5 million, 15% above valuation
-- Progressing the expansion opportunity at the Barcelona asset
let to Mango and beginning construction on the development plot at
Bornem, Belgium
-- Signed a green lease with Samsung on the vacancy at Breda, Netherlands
-- Agreed terms to lease the vacant unit at Strykow, Poland
-- Ongoing successful implementation of our ESG strategy,
including introducing ESG acquisition due diligence reports,
implementing green leases and a range of initiatives to improve
environmental performance, including progressing discussions on
solar PV installations
-- At the period end, the portfolio comprised:
-- 12 assets in prime locations, with a large average size of 70,146 sqm
-- A strong, well-diversified base of 21 tenant partners, 78%(4)
of whom are multi-billion Euro turnover businesses
-- 100% of assets are income producing(5) and 94% of rental
income is subject to an element of indexation each year
-- Weighted average unexpired lease term of 8.8 years at 31
March 2021 (30 September 2020: 9.1 years)
Post period end activity
-- Signed an agreement to purchase two prime logistics assets in Germany for EUR290.9 million
-- On 1 April 2021, completed the acquisition of a 70,000 sqm
global distribution centre close to Nuremberg, let for a 15 year
term to a global sportswear manufacturer and retailer
-- Contracted to buy a 94,000 sqm logistics unit in Lich near
Giessen to the north of Frankfurt
-- The Company has issued a Green Finance Framework which will
support its ongoing debt strategy
https://www.tritaxeurobox.co.uk/investors/shareholder-information/key-documentation/
Robert Orr, Chairman of Tritax EuroBox plc, commented:
" This was another positive period for the Company, reflecting
the growing maturity of the business, which was underpinned by the
oversubscribed equity raise. We delivered a robust financial
performance, supporting a growing dividend. We also continued to
successfully implement all elements of our evolved strategy, which
includes continued improvements to the sustainability criteria of
our properties.
" The fundamentals of our market remain compelling, with the
Covid-19 pandemic accelerating the growth of e-commerce, adding to
already significant occupier demand for high-quality, large-scale
and sustainable logistics space. The Manager has identified a
substantial pipeline of attractive opportunities that support our
strategic goals. We expect to make further progress in the second
half, as we carefully deploy the proceeds of March's equity raise
and look forward with confidence to the years ahead. "
Presentation for analysts and investors
A Company presentation for analysts and investors will take
place via a live webcast and audio only dial in at 10am (BST)
today.
To view the live webcast, please register at:
https://www.investis-live.com/tritaxeurobox/60991cbf8b32171000371026/tras
The audio only dial in is available using the following
details:
+44 (0) 203 936
Phone number: 2999
Participant access
code: 734857
The presentation will also be accessible on-demand later in the
day from the Company website:
https://www.tritaxeurobox.co.uk/investors/results-centre/ .
Notes
1 Valuation under IFRS (excluding rental guarantees)
2 As per KPI definition
3 See note 7 to the interim financial statements for
reconciliation
4 By rental income
5 Including licence fee income and rental guarantees
FOR FURTHER INFORMATION, PLEASE CONTACT:
Tritax EuroBox plc
+44 (0) 20 8051 5070
Nick Preston
Mehdi Bourassi
Jo Blackshaw (Investor Relations)
Maitland/AMO (Media enquiries)
James Benjamin
+44 (0) 7747 113 930
tritax -- maitland@maitland.co.uk
The Company's LEI is: 213800HK59N7H979QU33.
Notes:
Tritax EuroBox plc invests in and manages a well-diversified
portfolio of well-located Continental European logistics real
estate assets that are expected to deliver an attractive capital
return and secure income to shareholders. These assets fulfil key
roles in the logistics and distribution supply-chain focused on the
most established logistics markets and on the major population
centres across core Continental European countries.
Occupier demand for Continental European logistics assets is in
the midst of a major long-term structural change principally driven
by the growth of e-commerce. This is evidenced by technological
advancements, increased automation and supply-chain
optimisation.
The Company's Manager, Tritax Management LLP, has assembled a
full-service European logistics asset management capability
including specialist "on the ground" asset and property managers
with strong market standings in the Continental European logistics
sector.
Further information on Tritax EuroBox plc is available at
www.tritaxeurobox.co.uk
CHAIRMAN ' S STATEMENT
This has been a challenging period for society as a whole with
the full effect of the Covid 19 pandemic, including its impact on
European economies, yet to play out . However, the pandemic has
reinforced and accelerated the unprecedented change in consumer
behaviour with a notable increase in online retail transactions,
which has resulted in companies improving and modernising their
supply chains to adapt to the change in customer activity. The
market is therefore providing strong tailwinds for us, as occupier
demand for assets like ours continues to grow, while supply remains
heavily constrained in the best logistics locations.
At the same time, we have continued to benefit from the strength
and resilience of our carefully designed business model. We have
constructed a portfolio of large, high-quality assets in key
logistics locations, let to well-financed tenants. These
characteristics underpin our rental income, with 100% of the rent
due for the period having been collected, and this in turn supports
an attractive and progressive dividend. As the business continues
to mature, we are well placed to deliver further value for
shareholders.
Strategy for value creation
In my last report to you, I explained how we had continued to
refine our investment focus, in order to maximise the value we
create. While our overall investment policy and acquisition
criteria are unchanged, and we will continue to acquire fully let
standing assets when attractive opportunities arise, we are
increasingly looking to buy assets with value creation potential.
The pipeline we announced at the time of our equity raise in
February 2021 (see below) supports this approach, with four of the
six assets in the near-term pipeline displaying value-add
characteristics.
Financial performance, dividends and Total Return
As described in the Financial Review, the Company has continued
to deliver a strong financial performance, supporting a growing
dividend. Having declared a dividend of 1.10 cents per share each
quarter during the previous financial year, we increased the
dividend to 1.25 cents per share from the quarter ended 31 December
2020, resulting in a total dividend for the period of 2.50 cents
per share.
The dividend continues to be a substantial driver of our Total
Return, supplemented by active asset management and capital growth.
The Total Return for the period is 2.3%, reflecting an exceptional
and short term dilution related to the Capital Raise during the
period, a growing dividend and a 3.4% like for like valuation
increase. In this financial year, the Company expects to achieve
its annual Total Return target of 9%.
Financing
This has been an important period as we have successfully raised
the capital we need for the next stage of our growth. Our success
here reflects both the attractions of our sector to investors and
the growing maturity of our business.
In December 2020, we reached full deployment with the
acquisition of an asset in Nivelles, Belgium. With a strong
near-term pipeline of acquisition and internal development
opportunities, on 19 February 2021 we announced our intention to
raise EUR200 million through an equity issue. Such was the strength
of investor demand that we increased the issue size to EUR230
million on 5 March 2021. Since the end of the period, we have
deployed EUR290.9 million, adding two excellent assets and strong
new tenants to the portfolio. We are currently working on a number
of further investment opportunities which are close to signing. We
expect to complete deployment of these funds within the coming
months.
We were delighted by demand for the equity raise from both
current and new institutional shareholders. This has further
broadened and strengthened our share register. On 12 March 2021, we
reached a key milestone in the Company's development, with the
announcement that Fitch had awarded us an investment grade credit
rating. This opens up new sources of debt financing for us, while
immediately reducing the cost of our existing facilities.
Sustainability
Sustainability has been central to our approach since the
Company was founded. Recognising that both tenants and shareholders
are increasingly focused on ensuring that ESG considerations are at
the core of their respective businesses, we continue to grow our
portfolio with modern assets benefitting from excellent energy
efficiency and environmental credentials and we continue to enhance
performance by implementing our sustainability strategy through the
day to day management of the portfolio. The Manager's Report sets
out examples of this strategy in action during the period.
The Manager
The Company has identified a potential area of non-compliance in
regards to its treatment of a related party under the Listing Rules
in connection with certain of its acquisitions from Dietz AG. The
Company has voluntarily sought feedback from the FCA and expects to
receive guidance shortly.
Outlook
The outlook for the Company is positive. In the second half of
the year, deploying the proceeds of the equity raise and associated
debt will drive our revenue and earnings, while we expect to make
further progress with asset management. We expect ongoing yield
compression and rental growth to support total returns over the
next six months.
Looking further ahead, we see a multi-year opportunity for the
Company. The drivers of our market are stronger than ever and the
Manager continues to identify attractive opportunities to add to
our pipeline, sourced through its established relationships and the
pipelines of our specialist asset managers. We therefore look
forward to the future with confidence.
MANAGER ' S REPORT
Strong market fundamentals are being reinforced
The Company operates in a highly attractive market,
characterised by strong and growing occupier demand and highly
constrained supply of suitable logistics assets in the right
locations.
The logistics real estate sector is benefiting from several
powerful structural trends, we have identified three in particular
which are expected to sustain occupier demand over the
long-term:
-- the ongoing and rapid growth of e-commerce, requiring
companies to have large and often highly automated logistics
facilities, close to major population centres and strong transport
links;
-- the need to reduce costs, by optimising supply chains and
consolidating into fewer, larger and more efficient buildings;
-- the desire to have sustainable properties, with lower
environmental impacts and workspace that promotes employee
wellbeing, and that will remain fit for purpose for years to
come.
The economic shock triggered by the pandemic has accelerated and
intensified these trends that were already underway. The impact of
the pandemic, and also external events such as the recent stranding
of the Ever Given container ship in the Suez Canal, has shown
occupiers the vulnerability of their supply chains, prompting
companies to reconfigure supply chains by having more localised
manufacturing and holding higher levels of stock close to the end
user. The combination of these effects is leading to consistently
strong occupier demand for modern logistics buildings in key
locations across Europe.
At the same time there are ever scarcer numbers of suitable
vacant buildings, and little land on which to build new ones. There
are even fewer sites available that can accommodate very largest
logistics facilities, and municipalities are often reluctant to
zone land for the construction of these largest assets. As a
consequence, companies looking for large new logistics facilities
have few choices.
We will now explain why we believe that these market
fundamentals means the imbalance between demand and supply is
likely to persist for years to come, presenting a long-term
opportunity for the Company.
Occupier demand continues to outpace new construction
Occupier demand has been consistently strong for many years,
driven by the structural demand drivers as mentioned above, with
take-up across Europe averaging 21 million sqm per annum since
2016. Net absorption (which is the change in occupied space during
the period), has also been growing across Europe since 2010. The
disruption caused by the pandemic did very little to slow down
demand as net absorption reached 15.4 million sqm in 2020, making
it the second highest level since 2010 (Source: CBRE).
Supply remains constrained
Completion of new logistics real estate assets in 2020 did not
maintain pace with the increase in demand despite being up slightly
from 2019. While development pipelines remain healthy, we do not
expect them to be able to keep up with the demand. CBRE are
tracking only circa 13 million sqm of logistics space under
construction (representing 6% of total stock) as of Q1 2021. (1)
With over 65% of this pre-leased, and most of this due to deliver
in 2021, we expect to continue to see high levels of net absorption
as demand continues to grow. This will add further pressure on an
already constrained logistics supply market.
Concerns around environmental impact, strict zoning regulation,
and resistance to development near residential areas are
contributors to the moderate levels of development of logistics
facilities in continental Europe. These issues tend to be more
prominent in areas with denser populations, which is typically
where the Company invests. These factors mean that occupiers
looking for major new logistics facilities have few choices as the
logistics vacancy rates for continental Europe are at, or near lows
since 2010. Current vacant space in the eight main European
logistics markets (1) is around 45% of the average 5-year annual
take-up.
(1) European markets include Belgium, Czech Republic, France,
Germany, Italy, Netherlands, Poland and Spain.
Imbalance of supply and demand dynamics provide attractive
prospects for rental growth
Since 2017 there has been a shift in the dynamics of growth in
prime European logistics rents as the full impact of the
supply/demand dynamics began to be felt. Key submarkets such as
Belgium, Dusseldorf (Germany), and West Brabant (Netherlands) saw
the strongest annual growth in 2020, with prime rents in those
submarkets up 5.0% on 2019. Other submarkets like Rome, Munich and
Warsaw saw prime rents increase between 1.5-3.0%.
European logistics real estate regions move at varying speeds
due to the difference in the structure of individual economies. The
Manager's focus on key asset selection criteria following our
investment policy positions the Company well for future rental
growth, with 12 out of the Group's 13 assets (2) located in
submarkets where vacancy rates are below 5% according to Q1 2021
CBRE data.
(2) The Group's assets include the acquisition close to Nuremberg in Germany on 1 April 2021.
Investment demand exceeded expectations and remains robust
The dynamics of the occupational market also make the logistics
subsector highly appealing to investors, who are attracted by the
robust income streams and the potential for income and capital
growth. This is in contrast to the office and retail sectors, where
Covid-19 has put material pressure on rent collection levels, long
term expectations for rental values and hence capital values. The
investment market for logistics real estate assets is therefore
becoming increasingly competitive as continental European
investment volumes reached a new record of EUR 23.6bn in 2020, up
7% year-over-year with new capital entering the market and yields
compressing c. 25bp to 4.4% during the period. This investment
demand shows no sign of abating.
A strategy for value creation
The Company's strategy is designed to create value at the point
of asset acquisition and throughout the life cycle of the asset,
through:
-- careful asset selection, following our four-pillar investment philosophy;
-- proactive asset management, to extract value from the existing portfolio;
-- a robust focus on sustainability; and
-- appropriate financing.
We will continue to construct a portfolio which is diversified
by geography and tenant and that generates a high and secure level
of inflation-linked income, as well as capital growth, which will
in turn support the Total Returns and dividends we are
targeting.
As noted in the Chairman's statement, we have continued to
refine the Company's investment focus to take advantage of the
unprecedented market conditions, allowing us to maximise value
creation for shareholders. This includes increasing the Company's
focus on Value Add assets, either by acquiring assets at an earlier
stage in their development cycle, buying assets with vacancy, where
we can control the leasing, or developing unutilised land purchased
with an asset. The Company has access to an attractive pipeline
through its development and asset management partners, which
supports this strategy. The pipeline enables us to acquire new,
high-quality, sustainable logistics assets more cost-effectively
than competing on the open market, enhancing returns for
shareholders.
The strategy is supported by a progressive and active capital
management programme. This may include recycling capital through
asset disposals, partnering with other investors, continued debt
management and raising new equity, where supported by a clear
rationale.
The Company made good progress with all elements of its strategy
during the period, as set out below.
Further strengthening the portfolio
In December 2020, the Company acquired a newly built 34,125 sqm
logistics facility in Nivelles, Belgium. The purchase price was
EUR31.2 million, reflecting a net initial yield of 4.8%. The asset
comprises two units, one of which is let to Medi-Market Group SA, a
Belgian omni-channel pharmacy retailer on a new nine-year lease.
The rent is subject to annual indexation. The second, smaller unit
was vacant on acquisition and has a 12-month rental guarantee. We
are seeing good occupier interest in this unit.
On 15 February 2021, the Company announced that it had agreed
the sale of its asset leased to Castorama in Lodz, Poland. This was
one of our earlier asset purchases for the Company and having
completed the forward funding pre-let development opportunity at
the site in 2019, there were no imminent asset management
opportunities remaining. The sale price of EUR65.5 million was 15%
above the most recent valuation and delivered an attractive geared
internal rate of return of 16.5% to shareholders. We will continue
to actively review the portfolio for further opportunities to add
value in this way.
As a result of these transactions, at the period end the
portfolio comprised 12 assets, which were well diversified by
building size and tenant, and situated in the core European
countries of Belgium, Germany, Italy, the Netherlands, Poland and
Spain. These assets are key to our tenant partners' logistics and
distribution supply chain needs, and demonstrate the following key
characteristics:
-- modern, with 85% of the portfolio having been built in the
last five years, helping to ensure that the buildings meet the
latest operational and sustainability needs of occupiers;
-- large, with nearly 75% of the portfolio by area being in
excess of 50,000 sqm and an average size of 70,146 sqm;
-- sustainable, with 90% of the portfolio by floor area covered
by Green Building Certifications or Energy Performance
Certificates;
-- income generating, the portfolio has been constructed to
deliver secure and growing income, with around 78% of the Company's
21 tenant partners being multi-billion Euro businesses, including
some of the world's best-known companies; and
-- secured on long leases, resulting in a weighted average
unexpired lease term at the period end of 8.8 years, well ahead of
the Company's target minimum of five years. The unexpired lease
terms at the period end ranged up to 15.7 years.
The portfolio also delivers inherent rental growth, with some
94% of the Company's rent including an element of indexation.
Rental uplifts are either fixed or indexed to local inflation,
usually annually, thus offering the regular compounding of income
that supports the Company's dividend growth policy. We also look
for opportunities to capture market rental growth, which we expect
to exceed indexation, through asset management initiatives.
Asset management: capturing embedded value
We work proactively with the Company's tenant partners to secure
initiatives that drive rental income and capital values, supporting
the Company's delivery of secure long-term income and an attractive
Total Return.
Leasing activity
In December 2020, we agreed a new green lease at the Company's
property in Breda, Netherlands, letting the two vacant units to a
new high-quality tenant, Samsung SDS. The letting was secured
before the expiry of the 12-month rental guarantee on the vacant
units. The lease has been agreed for a three-year term from 15
December 2020 at an initial annual headline rent 6% above the level
of the rental guarantee. The new rent will be subject to annual
uplifts reflecting 100% of the Dutch Consumer Price Index. The
lease agreement contains green clauses to ensure the tenant's
commitment to using the building in a sustainable way, including
sharing data with us on energy and water consumption, waste
management and recycling.
In March 2021, the Company signed a new short-term lease at the
vacant unit in Strykow, Poland, with the lease commencing in May
2021 for a ten-month period. This forms part of the wider strategy
on this building to extend the occupancy on the vacant land. This
secures cashflow over the next twelve months while longer term
occupancy options are considered in conjunction with the adjacent
development land.
Expansion opportunities
In November 2019, the Company agreed an option to fund an 88,000
sqm extension to its global distribution centre in Barcelona, let
to Mango. We expect to secure the necessary building permits before
the end of May 2021, enabling us to proceed with construction
immediately thereafter. Practical completion is targeted for Q4
2022.
Development opportunities
The asset at Bornem, Belgium, included a plot of zoned land with
the potential to develop circa 15,000 sqm of warehouse space.
Construction work began in January 2021 and is expected to complete
in summer 2021. We are overseeing the development of the site in
conjunction with our development partner LCP. We are actively
marketing the property to find a suitable tenant, and to date have
received a good level of interest.
Implementing our sustainability strategy
The Company's portfolio is highly sustainable. 90% of the
portfolio is certified either with high Green Building
Certification or energy performance rating.
The Company's sustainability strategy underpins the Company's
overall investment approach. It focuses on owning healthy and
sustainable buildings, targeting net zero carbon emissions for
direct operations, improving the portfolio's energy efficiency,
enhancing nature and wellbeing, and creating socio-economic value.
We continue to make progress with this strategy throughout the
period.
Sustainable acquisitions
In line with the sustainability strategy, the acquisitions of
Nivelles, in January 2021, and Nuremberg (post period end) meet
high sustainability standards:
-- Nivelles features roof mounted solar panels, low energy LED
lighting, energy efficient heating and rainwater harvesting. We are
seeking BREEAM in-use certification with a target of Very Good.
-- Nuremberg is one of the most sustainable logistics buildings
in Germany. Certified to LEED Gold, it has been developed to be
carbon neutral, with a wealth of ESG criteria embedded in the
construction including an expansive green roof, a bee meadow, tree
planting, rainwater harvesting and intelligent lighting systems. We
will be working closely with the tenant to ensure that ongoing
operations meet all the sustainability ambitions of both the
Company and the tenant.
Sustainable development
All the Company's new developments will obtain Green Building
Certifications and have strong sustainability credentials:
-- The asset at Lich has been developed to DGNB Gold standard
and features state of the art energy efficiency such as LED
lighting systems and the building envelope has been constructed to
ensure high insulation standards, reducing energy usage for the
tenant, Wayfair.
-- The development features a range of health and wellbeing
amenities, including staff break out space, a community room, and
canteen in the office unit.
-- The extension for Mango in Barcelona aims to achieve a BREEAM
Very Good and will feature 1.8MW of solar PV.
Green leases
The Company continues to implement green lease clauses in new
leases, including the lease at Breda with Samsung described above.
We are in discussions with existing tenants to introduce green
lease clauses into three existing leases in the second half of the
year, hence transitioning these to be "Green Leases". It remains
our ultimate ambition to have all assets let on green leases in due
course.
Sustainable asset management
The Company is advancing its objective to ensure all assets have
Green Building Certification:
-- We are in the process of securing BREEAM in-use certification
at Rumst, Belgium. The new development of Unit C at Bornem is
seeking to achieve a BREEAM in-use on completion. Our target is a
rating of Very Good.
-- Installing onsite solar PV energy generation is an important
part of our ESG strategy and we are currently in discussions with
two tenants about potential projects that would generate 2.2 MW of
electricity a year.
-- At the Company's asset at Wunstorf, Germany, we are
installing electric vehicle charging points for both lorries and
cars, as well as beehives, which support the local habitat through
plant pollination.
-- The Company's Community Investment Fund supports tenants'
investment in local communities. We are already supporting projects
around Rumst in Belgium and are awaiting a proposal from a further
tenant.
The Company has recently published its Green Finance Framework
which details the Eligible Green Projects within the portfolio that
could be funded by green finance, as well as the governance and
management of the use of any green finance proceeds. This Framework
provides a backdrop which will assist the Company's future debt
strategy with a particular focus on green financing
initiatives.
FINANCIAL REVIEW
Portfolio valuation
The portfolio was independently valued by JLL as at 31 March
2021, in accordance with the RICS Valuation - Global Standards. The
portfolio's total value at the period end was EUR843.4 million (30
September 2020: EUR839.3 million). This reflected a like-for-like
valuation increase of 3.4% during the period, driven primarily by
yield compression. We expect this yield compression to continue
through 2021, as relevant transactional evidence is recorded. There
has been a relative scarcity of relevant evidence, despite the
amount of investment focussing on the sector. However, we are aware
of a number of transactions which, on closing, will provide
supportive evidence of further yield compression. The other impacts
on value such as ongoing indexation within leases and the benefits
of asset management initiatives are also expected to contribute in
the second half of our financial year.
Financial results
Rental income
Rental income for the period was EUR19.4 million (2020: EUR17.4
million). The annualised base increase is mainly driven by the
closing of the acquisition of the Nivelles asset in Belgium, in
January 2021, and by some indexation events.
In the financial year ended 30 September 2020, the Group
deferred EUR1.6m of rent from a single tenant. Under IFRS, rental
income from each lease is smoothed over the term of the lease and
hence there was no impact on reported IFRS revenue in the period to
31 March 2021.
In the period ended 31 March 2021, the Group received EUR0.5
million corresponding to the first three instalments as planned,
leading to an increased Group's Adjusted Earnings by the same
amount of EUR0.5 million. Post period end, the Group received the
April's and May's instalments as agreed.
Costs
The Company's operating and administrative costs were EUR5.4
million (2020: EUR5.0 million), which primarily comprised:
-- the Management Fee payable to the Manager of EUR2.3 million (2020: EUR2.1 million) ;
-- a fee for running an SGR structure in Italy, which ensures
the Italian property holding company is exempt from corporation and
income tax ;
-- the Company's running costs, including accounting, tax and audit ;
-- the Directors' fees ; and
-- non-recoverable VAT of EUR0.1 million (2020: EUR0.2 million). The Company stopped incurring non-recoverable VAT from 1 January 2021, as a result of the UK's exit from the European Union.
The EPRA cost ratio (inclusive of vacancy cost) was 31.3% (2020:
30.2%). We expect the EPRA cost ratio to decrease over time, as the
portfolio continues to grow and the Company benefits from economies
of scale.
Interest expense and commitment fees
The total cost of debt for the period was EUR4.0 million (2020:
EUR3.5 million), with interest cover of 4.64 times (2020: 4.95
times). The weighted average cost of debt in the period was 2.3%
(2020: 2.3%). On 12 March 2021, the Company announced that it had
received an investment grade credit rating of BBB- from Fitch
Ratings Limited. This resulted in a reduction of approximately 30
basis points in the cost of the existing Revolving Credit Facility.
The full effect of that reduction in interest cost will be seen in
the future periods.
Gain on revaluation
The fair value gain on the revaluation of the Company's
investment properties was EUR26.4 million (2020: EUR19.4 million).
The drivers of the valuation increase are discussed in the
Portfolio valuation section above.
Profit on disposal
On 15 February 2021, the Company announced that it had agreed
the sale of its asset in Lodz, Poland, for EUR65.5 million. This
represented a premium of 15% above its book value at 30 September
2020 and resulted in a net profit on disposal (post fees and post
capital gain taxes) of EUR4.3 million in the period (2020: EUR0.8
million).
Profit before tax
Profit before tax for the period was EUR41.2 million (2019:
EUR27.8 million).
Taxation
The current income taxation charge for the period was 18.3% of
the Company's net property income (2020: 0.8%). A significant part
of that (88.6%) relates to the disposal of our asset in Lodz, with
the realised capital gain taxes being accounted for during the
period.
The taxation charge is primarily incurred in the local
jurisdictions in which the Company invests. As an HMRC-approved
investment trust, the Company is exempt from UK corporation tax on
its chargeable gains. The Company is also exempt from UK
corporation tax on dividend income received, whether from UK or
non-UK companies, provided the dividends fall within one of the
exempt classes under the Corporation Tax Act 2009.
The corporation tax rate in future periods will depend primarily
on the jurisdictions where the Company acquires assets, given the
differing tax rates across continental Europe. The Company does not
use any structures designed to artificially reduce its tax
liabilities and looks to pay the appropriate level of tax where it
is due.
Earnings
As discussed under Equity Financing below, the Company's share
issue in March 2021 increased its issued share capital by 48.5%.
Given the short time until the period end, none of this capital had
been effectively deployed at 31 March 2021 which meant exceptional
short term EPS dilution. However, as the funds from the raise are
deployed, we expect the EPS to increase to accretion.
Basic EPS for the period was 7.32 cents (2020: 5.32 cents). EPRA
EPS, which primarily excludes the valuation movement, was 1.59
cents (2020: 1.76 cents).
Given the Company's income focus, the Board has adopted Adjusted
EPS as a key performance indicator. This adjusts the income shown
in the Company Statement of Comprehensive Income to reflect the
underlying cash movements and/or earnings that do not go through
the IFRS Comprehensive Income, including rental guarantees or
licence fees and the EUR0.5 million in rent received that was
deferred from the previous financial year, as noted above.
Adjusted Earnings for the period were EUR10.3 million (2020:
EUR9.5 million), resulting in Adjusted EPS of 2.30 cents (2020:
2.25 cents). More information about the calculation of basic, EPRA
and adjusted EPS can be found in note 7 to the Interim financial
statements.
Dividends
Since the start of the period, the Company has declared the
following dividends:
-- 1.10 cent per share on 3 December 2020, in respect of the
period from 1 July to 30 September 2020 (paid 8 January 2021);
-- 1.25 cents per share on 10 February 2021, in respect of the
period from 1 October 2020 to 31 December 2020 (paid 12 March
2021); and
-- 1.25 cents per share on 18 May 2021, in respect of the period
from 1 January 2021 to 31 March 2021. This dividend will be paid on
or around 18 June 2021 to shareholders on the register at 28 May
2021.
The total dividend for the period was EUR12.98 million (2020:
EUR9.3 million), or 2.50 cents per share, and was 79.1% covered by
Adjusted Earnings (2020: 102.1%), reflecting the short-term
dilution from the equity issue noted above.
Cash flow
The Company benefits from stable, growing and long-term cash
flows. Cash from operations in the period was a net inflow of
EUR17.9 million (2020: net inflow of EUR16.9 million).
Net assets
The IFRS NAV per share at the period end was EUR1.22 (30
September 2020: EUR1.19). Information on EPRA's net asset valuation
metrics can be found in the EPRA Performance Measures section.
Equity financing
On 19 February 2021, the Company announced its intention to
raise gross proceeds of approximately GBP173 million or EUR200
million, through a placing, open offer, offer for subscription and
intermediaries offer. Investor demand for the issues resulted in it
being significantly oversubscribed. The Company therefore announced
on 5 March 2021 that it had increased the size of the issue to
approximately GBP198.4 million (EUR230 million). This resulted in
the issue of 192,633,688 new ordinary shares in the Company at a
price of 103 pence (EUR1.19) each. The new shares were admitted to
trading on 10 March 2021.
Debt financing
The Company has a EUR425 million Revolving Credit Facility (RCF)
provided by a group of five lenders - HSBC, BNP Paribas, Bank of
America Merrill Lynch, Bank of China and Banco de Sabadell. In
October 2020, three of the five lenders agreed to a one-year
extension of the facility. As a result, EUR100 million of debt
matures in 2023 and EUR100 million in 2024, with the remaining
EUR225 million now maturing in 2025. The facility is unsecured,
providing operational flexibility for the Company.
At the period end, the Company had drawn EUR260.0 million
against the RCF (30 September 2020: EUR344.0 million), with the
reduction reflecting the proceeds of the equity issue and the
disposal of the asset in Lodz, Poland. This resulted in an LTV
ratio of 25.0% (30 September 2020: 39.9%). This compares with the
medium-term target of 45% and the maximum permitted by the
Company's investment policy of 50%. As the Company invests in the
pipeline outlined earlier, the LTV ratio is expected to increase
back towards the target level.
The Company's hedging strategy includes using interest rate caps
to benefit from current low interest rates, while minimising the
effect of a significant rise in underlying interest rates. The
Company therefore holds three interest rate caps which hedge EUR300
million of its borrowing, resulting in 87% of drawn debt being
subject to an interest cap, with a total weighted average interest
cap of 0.67%.
Regulatory matters
On 1 April 2021, Aberdeen Standard Investments (ASI) acquired a
60% stake in the Manager. The Board believes this is positive for
the Group and that there will be no impact on the Manager's ability
to continue to deliver our strategy successfully. The dedicated
team responsible for the Group's day-to-day operations under the
Investment Management Agreement remains unchanged. In the longer
term, we expect that ASI's stake will strengthen the Manager, by
giving it access to the resources of a global financial
institution, while preserving the Manager's unique and
market-leading logistics real estate expertise for our
shareholders.
Post period end activity
On 31 March 2021, the Company announced that it signed the
agreement to purchase of two highly sustainable logistics assets in
Germany for EUR290.9 million. On 1 April 2021, the Company
completed the acquisition of a Foundation asset, which is a highly
specified logistics building of circa 70,000 sqm close to Nuremberg
in Bavaria. The strategically located asset is the European
distribution headquarters of a leading German based global
sportswear manufacturer and retailer. The property is CO(2)
neutral, built to LEED Gold standard, benefits from certified green
energy procurement, has a roof mounted photovoltaic system
generating up to 1.5 megawatts of electricity and has a 22,500 sqm
green roof.
The property is leased for a further 14 years benefitting from
indexation to 100% of the German CPI index following a four-year
indexation holiday from the start of the lease. The 20-hectare site
comes with extension potential for an additional 42,000 sqm of
floorspace. This property has been developed by Dietz AG, a leading
European logistics developer, and one of the Company's retained
development partners. Dietz AG will remain as a minority
shareholder in this asset.
Related party transactions
Transactions with related parties in the period included the
Management Fee paid to the Manager, and the Directors' fees. More
information can be found in note 17 to the Interim financial
statements.
Alternative Investment Fund Manager (AIFM)
The Company is an Alternative Investment Fund within the meaning
of the AIFMD and has appointed the Manager as its AIFM. The Manager
is authorised and regulated by the Financial Conduct Authority as a
full scope AIFM.
KEY PERFORMANCE INDICATORS
Set out below are the key performance indicators we use to track
our strategic progress.
KPI and definition Comments Performance
1. Dividend The dividend reflects 2.50 cents/share
Dividends paid to our ability to deliver for the six months
shareholders and declared a growing income stream ended 31 March 2021
in relation to the from our portfolio (31 March 2020: 2.20
period. and is a key element cents/share and 30
of our Total Return. September 2020: 4.40
Our policy is to pay cents/share)
an attractive and
progressive dividend,
with the intent to
pay out 90-100% of
our Adjusted Earnings
each year, with a
minimum payout of
85% of Adjusted Earnings.
------------------------------- --------------------------------
2. Total Return (TR) TR measures the ultimate 2.3%
TR measures the change outcome of our strategy, for the six months
in the EPRA Net Reinstatement which is to create ended 31 March 2021
Value (EPRA NRV) over value for our shareholders (31 March 2020: 5.8%(1)
the period plus dividends through our portfolio and 30 September 2020:
paid. and to deliver a secure 11.3%(1) )
and growing income
stream. The Company's
medium-term TR target
set at IPO is 9% per
annum by reference
to the IPO issue price.
------------------------------- --------------------------------
3. Basic Net Asset Basic Net Asset Value EUR751.67m
Value measures the net value EUR1.22/share
Net asset value in of the Company under as at 31 March 2021
IFRS GAAP IFRS. (EUR490.88m/EUR1.16/share
as at 31 March 2020
and EUR503.91m/EUR1.19/share
as at 30 September
2020)
------------------------------- --------------------------------
4. Adjusted earnings Adjusted EPS reflects EUR10.25m
Post-tax adjusted our ability to generate 2.30 cents/share
EPS attributable to earnings from our for the six months
shareholders, adjusted portfolio, which ultimately ended 31 March 2021
for other earnings underpins our dividend (31 March 2020: EUR9.49m/2.25
not supported by cash payments. cents/share and 30
flows. September 2020: EUR17.56m/4.16
See note 7 to the cents/share)
Interim financial
statements.
------------------------------- --------------------------------
5. Loan to value The LTV measures the 25.0%
ratio (LTV) prudence of our financing at 31 March 2021
The proportion of strategy, balancing (31 March 2020: 41.8%
our gross asset value the additional returns and 30 September 2020:
(including cash) that and portfolio diversification 39.9%)
is funded by borrowings that come with using
debt against the need
to successfully manage
risk. The Company
will maintain a conservative
level of aggregate
borrowings, with a
medium-term target
of 45% of gross asset
value and a maximum
limit of 50% (in each
case, calculated at
the time of borrowing).
------------------------------- --------------------------------
6. Weighted average The WAULT is a key 8.8 years
unexpired lease term measure of the quality at 31 March 2021
(WAULT) of our portfolio. (31 March 2020: 9.7
The average unexpired Long lease terms underpin years and 30 September
lease term of the the security of our 2020: 9.1 years)
property portfolio income stream. The
weighted by annual Company seeks to maintain
passing rents. a WAULT of greater
than five years across
the portfolio, in
accordance with typical
lease lengths prevalent
in Continental Europe.
------------------------------- --------------------------------
7. Dividend cover The dividend cover 79.1%
Dividends paid and helps to indicate for the six months
proposed to shareholders how sustainable a to 31 March 2021
in relation to the dividend is. It measures (31 March 2020: 102.1%
financial period. the proportion of and 30 September 2020:
dividends which is 94.4%)
supported by adjusted
earnings.
------------------------------- --------------------------------
8. Interest cover Interest cover is 4.64 times
The ratio of net property a measure of a company's for the six months
income to the interest ability to meet its to 31 March 2021
incurred in the period. interest payments. (31 March 2020: 4.95
times and 30 September
2020: 4.63 times)
------------------------------- --------------------------------
9. Like-for-like rental This measures the 0.68%/EUR0.24m
growth Company's ability for the six months
Like-for-like rental to grow its rental to 31 March 2021
growth compares the income over time. (31 March 2020 (2)
growth of the rental Rental growth will : 1.7%/EUR0.42m and
income of the portfolio not be linear during 30 September 2020:
that has been consistently the hold period, with 0.5%/EUR0.18m)
in operation and not different mechanisms
under development in each lease agreement.
during the two full The 0.7% this period
preceding periods. reflects the lower
inflation background.
------------------------------- --------------------------------
(1) Total Return for comparative period 31 March 2020 has been
prepared using the new EPRA NAV metrics issued in October 2019.
(2) This is comparing the annualised passing rent at the Balance
Sheet date against the annualised passing rent at the previous
interim date December 2018.
EPRA PERFORMANCE MEASURES
The table below shows additional performance measures,
calculated in accordance with the Best Practices Recommendations of
the European Public Real Estate Association (EPRA). We provide
these measures to aid comparison with other European real estate
businesses. For a full reconciliation of the new EPRA NAV measures,
please see the Notes to the EPRA and Other Key Performance
Indicators.
Performance measures and Comments Performance
definition
1. EPRA Net Reinstatement A key measure to highlight EUR805.40m/EUR1.31/share
Value (EPRA NRV) the value of net assets as at 31 March
Basic NAV adjusted for on a long-term basis. 2021
mark-to-market valuation The metric reflects (31 March 2020(1)
of derivatives, deferred what would be needed : EUR531.95m/EUR1.26/share
tax and transaction costs to recreate the current and 30 September
(real estate transfer portfolio of the company. 2020: EUR550.50m/EUR1.30/share)
tax and purchaser's costs).
----------------------------- ---------------------------------
2. EPRA Net Tangible Assets Assumes that entities EUR769.28m/EUR1.25/share
(EPRA NTA) buy and sell assets, as at 31 March
Basic NAV adjusted to thereby crystallising 2021
remove the fair values certain levels of (31 March 2020(1)
of financial instruments unavoidable deferred : EUR500.50m/EUR1.18/share
and deferred taxes. This tax. and 30 September
excludes transaction costs. 2020: EUR516.31m/EUR1.22/share)
----------------------------- ---------------------------------
3. EPRA Net Disposal Value Represents the shareholders' EUR751.67m/EUR1.22/share
(EPRA NDV) value under a disposal as at 31 March
Equivalent to IFRS NAV, scenario, where deferred 2021
as this includes the fair tax, financial instruments (31 March 2020(1)
values of financial instruments and certain other : EUR490.88m/EUR1.16/share
and deferred taxes. adjustments are calculated and 30 September
to the full extent 2020: EUR503.91m/EUR1.19/share)
of their liability,
net of any resulting
tax.
----------------------------- ---------------------------------
4. EPRA Earnings A key measure of the EUR7.09m
Earnings from operational Company's underlying 1.59 cents/share
activities. results and an indication for the six months
of the extent to which to 31 March 2021
current dividend payments (31 March 2020:
are supported by earnings. EUR7.45m/1.76
cents/share and
30 September 2020:
EUR13.80m/3.26
cents)
----------------------------- ---------------------------------
5. EPRA Net Initial Yield This measure should 4.4%
(NIY) make it easier for as at 31 March
Annualised rental income investors to judge 2021
based on the cash rents for themselves how (31 March 2020:
passing at the balance the valuations of 4.1% and 30 September
sheet date, less non-recoverable portfolios compare. 2020: 4.4%)
property operating expenses,
divided by the market
value of the property,
increased with (estimated)
purchasers' costs.
----------------------------- ---------------------------------
6. EPRA 'Topped-up' NIY This measure should 4.4%
This measure incorporates make it easier for as at 31 March
an adjustment to the EPRA investors to judge 2021
NIY in respect of the for themselves how (31 March 2020:
expiration of rent-free the valuations of 4.7% and 30 September
periods (or other unexpired portfolios compare. 2020: 4.6%)
lease incentives such
as discounted rent periods
and step rents).
----------------------------- ---------------------------------
7. EPRA Vacancy Rate The vacancy relates 4.1%
Estimated Market Rental to part of the new for the six months
Value (ERV) of vacant acquisition in Nivelle to 31 March 2021
space divided by ERV of and in Strykow. These (31 March 2020:
the whole portfolio. buildings were acquired 5.5% and 30 September
partly vacant with 2020: 5.4%)
rental guarantees
covering the vacant
space.
----------------------------- ---------------------------------
8. EPRA Cost Ratio A key measure to enable 31.3%(2)
Administrative and operating meaningful measurement for the six months
costs (including and excluding of the changes in to 31 March 2021
costs of direct vacancy) a company's operating (31 March 2020:
divided by gross rental costs. We expect the 30.2% (2) and
income. EPRA cost ratio to 30 September 2020:
decrease over time, 31.3% (2) )
as the portfolio grows 30.9%(3)
and the Company benefits for the six months
from economies of to 31 March 2021
scale. (31 March 2020:
29.9% (3) and
30 September 2020:
31.0%(3) )
----------------------------- ---------------------------------
(1) Comparative for 31 March 2020 has been prepared using the
new EPRA NAV metrics issued in October 2019. A reconciliation of
the comparatives is provided within the Notes to EPRA NAV
calculations.
(2) Inclusive of vacant property costs.
(3) Exclusive of vacant property costs.
PRINCIPAL RISKS AND EMERGING UNCERTAINTIES
The Audit Committee, which assists the Board with its
responsibilities for managing risk, considers that the principal
risks and uncertainties as presented on pages 40 to 45 of our 2020
Annual Report, were largely unchanged during the period. However,
this is not to say that certain risks have not increased or
decreased in probability or impact during the period.
In particular, the risks associated with COVID-19 pandemic are
today better understood than they were during last financial year.
However, the Company continues to carefully monitor the evolution
of it as it can have an adverse impact on the magnitude and/or
likelihood of a number of principal risks set out below.
Property risks
1. The default of one or more of our tenants would reduce
revenue and may affect our ability to pay dividends and/or lead to
a breach of our banking covenants.
2. The performance and valuation of the portfolio are affected
by the market, which is inherently subjective and uncertain. A
change in property valuations may lead to a breach of our banking
covenants.
3. Our due diligence may not identify all risks and liabilities
in respect of a property acquired. An adverse change in the future
valuation of that asset may lead to a decrease in our Net Asset
Value and affect our ability to meet our target returns.
4. Our ability to grow the portfolio may be restricted by the
availability of suitable assets at acceptable prices in targeted
countries in Continental Europe.
5. We may have concentration of risk, in particular exposure to
country risk, if there are significant economic or political
changes in countries where the Company has invested or the
Eurozone, which could have an adverse impact on the income derived
from said countries and on the valuation of those assets. This
could lead to weaker performance of the portfolio.
6. Development activities involve a higher degree of risk than
investment in standing investments, such as general construction
risks, cost overruns or developer/contractor default. This could
reduce the value of our portfolio if any of the risks associated
materialised.
Operational risks
1. The Company's performance will, to a large extent, depend on
the Manager's abilities to source adequate assets, and to actively
manage these assets.
2. Termination of the Investment Management Agreement would
severely affect our ability to manage our operations and may have a
negative impact on the Company's share price.
3. Failure to secure insurance for assets at suitable pricing
levels may have a negative impact on shareholder returns, or create
significant financial risk if assets are uninsured
Financial risks
1. Our use of floating rate debt will expose the Company to
underlying interest rate movements. Any adverse movement in Euribor
could affect our profitability and ability to pay dividends.
2. A lack of debt funding at appropriate rates may restrict our
ability to grow, by making us unable to pursue suitable investment
opportunities. This may impair our ability to reach our targeted
returns.
3. Failure to operate within our debt covenants could lead to a
default and debt funding being recalled. This may result in us
selling assets to repay loan commitments.
Taxation risks
1. If the Company fails to maintain approval as an Investment
Trust its income and gains will be subject to UK corporation tax
and it will be unable to designate dividends as interest
distributions.
2. A change in local taxation status or tax legislation in any
of the countries we invest in may lead to increased tax charges for
the Company, resulting in lower profits and returns to
Shareholders.
Political risks
1. There is continuing uncertainty relating to the world
economy, combined with political uncertainty in many countries.
This could have a negative effect on the performance of the Company
over both the short and longer term.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
We confirm that to the best of our knowledge:
-- the condensed set of financial statements has been prepared
in accordance with the Disclosure Guidance and Transparency Rules
of the Financial Services Authority, IAS 34 'Interim Financial
Reporting', and with international financial reporting standards
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in
the European Union;
-- the interim management report includes a fair review of the information required by:
(a) DTR 4.2.7R of the Disclosure Guidance and Transparency
Rules, being an indication of important events that have occurred
during the first six months of the financial year and their impact
on the condensed set of financial statements; and a description of
the principal risks and uncertainties for the remaining six months
of the year; and
(b) DTR 4.2.8R of the Disclosure Guidance and Transparency
Rules, being related party transactions that have taken place in
the first six months of the current financial year and that have
materially affected the financial position or performance of the
entity during that period; and any changes in the related party
transactions described in the last annual report that could do
so.
Approved by the Board on 17 May 2021
and signed on its behalf by:
Robert Orr Director
INDEPENT REVIEW REPORT TO TRITAX EUROBOX PLC
Conclusion
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 31 March 2021 which comprises condensed group
statement of comprehensive income, condensed consolidated statement
of financial position, condensed group statement of changes in
equity, condensed group cash flow statement and the related
explanatory notes.
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 31
March 2021 is not prepared, in all material respects, in accordance
with IAS 34 Interim Financial Reporting adopted pursuant to
Regulation (EC) No 1606/2002 as it applies in the European Union
and the Disclosure Guidance and Transparency Rules ("the DTR") of
the UK's Financial Conduct Authority ("the UK FCA").
Scope of review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity issued by the Auditing Practices Board for use in the
UK. A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures. We read the other information contained in the
half-yearly financial report and consider whether it contains any
apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would
become aware of all significant matters that might be identified in
an audit. Accordingly, we do not express an audit opinion.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the DTR of the UK FCA.
The annual financial statements of the group/company are
prepared in accordance with International Financial Reporting
Standards as adopted by the EU and the next annual financial
statements will be prepared in accordance with International
Financial Reporting Standards adopted pursuant to Regulation (EC)
No 1606/2002 as it applies in the European Union and in accordance
with international accounting standards in conformity with the
requirements of the Companies Act 2006. The directors are
responsible for preparing the condensed set of financial statements
included in the half-yearly financial report in accordance with IAS
34 adopted pursuant to Regulation (EC) No 1606/2002 as it applies
in the European Union.
Our responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
The purpose of our review work and to whom we owe our
responsibilities
This report is made solely to the company in accordance with the
terms of our engagement to assist the company in meeting the
requirements of the DTR of the UK FCA. Our review has been
undertaken so that we might state to the company those matters we
are required to state to it in this report and for no other
purpose. To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the company for our
review work, for this report, or for the conclusions we have
reached.
David Neale
for and on behalf of KPMG LLP
Chartered Accountants
15 Canada Square
London
E14 5GL
17 May 2021
Condensed Group Statement of Comprehensive Income for the six
months ended 31 March 2021
Six months Six months
ended ended
31 March 31 March
2021 2020
(unaudited) (unaudited)
Note EURm EURm
--------------------------------------------- ------------ ------------
Rental income 4 19.35 17.41
Service charge income 4 3.67 2.60
Other income 4 0.19 0.17
----------------------------------------- ------------ ------------
Gross property income 4 23.21 20.18
Direct property costs (4.51) (3.02)
----------------------------------------- ------------ ------------
Net property income 18.70 17.16
----------------------------------------- ------------ ------------
Fair value gain on investment properties 9 26.38 19.35
Gain on disposal of investment property 7.38 0.81
Administrative and other expenses (5.40) (5.00)
----------------------------------------- ------------ ------------
Operating profit 47.06 32.32
----------------------------------------- ------------ ------------
Finance expense 5 (5.90) (4.61)
Effect of foreign exchange differences 0.08 0.04
Changes in fair value of interest rate
derivatives 13 (0.01) 0.07
----------------------------------------- ------------ ------------
Profit before taxation 41.23 27.82
Taxation 6 (8.60) (5.35)
----------------------------------------- ------------ ------------
Profit and total comprehensive income
for the period 32.63 22.47
Earnings Per Share (EPS) (expressed
in cents per share)
EPS - basic and diluted 7 7.32 5.32
----------------------------------------- ------------ ------------
Condensed Consolidated Statement of Financial Position as at 31
March 2021
31 March 30 September
2021 2020
(unaudited) (audited)
Note EURm EURm
----------------------------------------- ---- ------------ ---------------
Non-current assets
Investment properties 9 841.64 837.90
Derivative financial instruments 13 0.08 0.09
Trade and other receivables 10 1.17 1.17
Deferred tax assets 0.32 1.15
----------------------------------------- ---- ------------ ---------------
Total non-current assets 843.21 840.31
Current assets
Trade and other receivables 10 12.40 14.72
Cash and cash equivalents 200.05 24.44
----------------------------------------- ---- ------------ ---------------
Total current assets 212.45 39.16
----------------------------------------- ---- ------------ ---------------
Total assets 1,055.66 879.47
----------------------------------------- ---- ------------ ---------------
Current liabilities
Trade and other payables (12.12) (9.29)
Income tax liability (3.61) (0.34)
----------------------------------------- ---- ------------ ---------------
Total current liabilities (15.73) (9.63)
Non-current liabilities
Trade and other payables (1.39) (1.46)
Loans and borrowings 11 (256.59) (340.63)
Deferred tax liabilities (18.01) (13.64)
Other liabilities 12 (10.16) (8.89)
Tenant deposit (2.11) (1.31)
----------------------------------------- ---- ------------ ---------------
Total non-current liabilities (288.26) (365.93)
----------------------------------------- ---- ------------ ---------------
Total liabilities (303.99) (375.56)
----------------------------------------- ---- ------------ ---------------
Net assets 751.67 503.91
----------------------------------------- ---- ------------ ---------------
Equity
Share capital 15 6.15 4.23
Share premium reserve 354.38 131.24
Retained earnings 391.14 368.44
----------------------------------------- ---- ------------ ---------------
Total equity 751.67 503.91
----------------------------------------- ---- ------------ ---------------
Net Asset Value (NAV) per share (expressed
in Euro per share)
Basic NAV 16 1.22 1.19
EPRA NRV (formerly EPRA NAV)(1) 16 1.31 1.30
----------------------------------------- ---- ------------ -------------
(1) The prior year has been recomputed in line with the latest
EPRA guidance over Net Asset Value measures.
Condensed Group Statement of Changes in Equity for the six
months ended 31 March 2021
Share Retained
capital Share premium earnings Total
(Unaudited) Note EURm EURm EURm EURm
--------------------------------- ------ --------- ------------- --------- -------
At 1 October 2020 4.23 131.24 368.44 503.91
Profit and total comprehensive
income - - 32.63 32.63
--------------------------------- ------ --------- ------------- --------- -------
4.23 131.24 401.07 536.54
Contributions and distributions:
New share capital subscribed 1.92 228.08 - 230.00
Associated share issue costs - (4.94) - (4.94)
Dividends paid - - (9.93) (9.93)
--------------------------------- ------ --------- ------------- --------- -------
Total contributions and
distributions 1.92 223.14 (9.93) 215.13
--------------------------------- ------ --------- ------------- --------- -------
At 31 March 2021 6.15 354.38 391.14 751.67
--------------------------------- ------ --------- ------------- --------- -------
Share Retained
capital Share premium earnings Total
(Audited) Note EURm EURm EURm EURm
--------------------------------- ------ --------- ------------- --------- -------
At 1 October 2019 4.23 131.21 341.83 477.27
Profit and total comprehensive
income - - 44.79 44.79
--------------------------------- ------ --------- ------------- --------- -------
4.23 131.21 386.62 522.06
Contributions and distributions:
Associated share issue costs - 0.03 - 0.03
Dividends paid 8 - - (18.18) (18.18)
--------------------------------- ------ --------- ------------- --------- -------
Total contributions and
distributions - 0.03 (18.18) (18.15)
--------------------------------- ------ --------- ------------- --------- -------
At 30 September 2020 4.23 131.24 368.44 503.91
Share Retained
capital Share premium earnings Total
(Unaudited) Note EURm EURm EURm EURm
--------------------------------- ------ --------- ------------- --------- -------
At 1 October 2019 4.23 131.21 341.83 477.27
Profit and total comprehensive
income - - 22.47 22.47
--------------------------------- ------ --------- ------------- --------- -------
4.23 131.21 364.30 499.74
Contributions and distributions:
Associated share issue costs - 0.02 - 0.02
Dividends paid - - (8.88) (8.88)
--------------------------------- ------ --------- ------------- --------- -------
Total contributions and
distributions - 0.02 (8.88) (8.86)
--------------------------------- ------ --------- ------------- --------- -------
At 31 March 2020 4.23 131.23 355.42 490.88
--------------------------------- ------ --------- ------------- --------- -------
Condensed Group Cash Flow Statement for the six months ended 31
March 2021
Six months
ended
Six months
ended 31 March
31 March 2020
2021 (unaudited) (unaudited)
Note EURm EURm
-------------------------------------------- ----- ------------------ ------------------
Cash flows from operating activities
Profit for the period 32.63 22.47
Gain on disposal (7.38) (0.81)
Changes in fair value of investment
properties (26.38) (19.35)
Changes in fair value of interest rate
derivatives 0.01 (0.07)
Tax expense 8.60 4.88
Finance expense 5.90 3.96
Accretion of tenant lease incentive
and amortisation of capital contribution
and lease commission 4 0.33 (1.26)
Decrease in trade and other receivables 1.49 10.78
Increase/(decrease) in trade and other
payables 2.69 (3.68)
-------------------------------------------- ----- ------------------ ------------------
Cash generated from operations 17.89 16.92
Tax paid (0.34) (0.63)
Net cash flow generated by operating
activities 17.55 16.29
-------------------------------------------- ----- ------------------ ------------------
Investing activities
Purchase of investment properties (32.12) (101.05)
Disposal of investment properties 64.35 -
Disposal of assets held-for-sale - 2.33
Improvements to investment properties
and development expenditure (1.68) (6.47)
Rental guarantees received 0.95 -
-------------------------------------------- ----- ------------------ ------------------
Net cash flow generated by/(used in)
investing activities 31.50 (105.19)
-------------------------------------------- ----- ------------------ ------------------
Financing activities
Proceeds from issue of Ordinary Share 230.00 -
capital
Cost of share issues (4.94) 0.02
Loans received 11 180.00 121.00
Loans repaid 11 (264.00) -
Loan arrangement fees paid 11 (0.37) (0.73)
Loan interest paid (4.12) (3.37)
Dividends paid to equity holders 8 (9.93) (8.88)
-------------------------------------------- ----- ------------------ ------------------
Net cash flow generated from financing
activities 126.64 108.04
-------------------------------------------- ----- ------------------ ------------------
Net movement in cash and cash equivalents
for the period 175.69 19.14
Cash and cash equivalents at start
of the period 24.44 17.90
Unrealised foreign exchange (losses)/gains (0.08) 0.03
-------------------------------------------- ----- ------------------ ------------------
Cash and cash equivalents at end of
the period 200.05 37.07
-------------------------------------------- ----- ------------------ ------------------
Notes to the Condensed Consolidated Financial Statements for the
six months ended 31 March 2021
1. Basis of preparation
These condensed financial statements for the six months ended 31
March 2021 have been prepared in accordance with the Disclosure
Guidance and Transparency Rules of the Financial Services
Authority, IAS 34 'Interim Financial Reporting', and with
international financial reporting standards adopted pursuant to
Regulation (EC) No 1606/2002 as it applies in the European Union.
They were approved for issue on 17 May 2021. These condensed
financial statements are unaudited and do not constitute statutory
accounts for the purposes of the Companies Act 2006.
The comparative financial information presented herein for the
period to 30 September 2020 for the Condensed Consolidated
Statement of Financial Position or 31 March 2020 for other primary
statements does not constitute statutory accounts as defined in
section 434 of the Companies Act 2006. A copy of the statutory
accounts for that period has been delivered to the Registrar of
Companies. The auditor's report on those accounts for the period
from 1 October 2019 to 30 September 2020 was not qualified, did not
include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying the report, and did
not contain statements under section 498(2) or (3) of the Companies
Act 2006.
1.1 Going concern
The Directors have prepared cash flow forecasts for the Group
for a period of 12 months from 31 March 2021 of these financial
statements. These forecasts include the Directors' assessment of
the impact of Covid-19 on the Group, and plausible downside
scenarios.
The Group's property portfolio is let to 21 tenants across over
12 properties in 6 European countries. The Group's largest tenant
represents 20% of contracted rent at 31 March 2021 and the top 5
tenants together represent 61%.
The Directors have considered the risk that further tenants
either request deferrals or become insolvent and hence no rent is
paid. The Directors have assessed each tenant's risk based on
experience, knowledge of the tenant and discussions to date on rent
deferrals. Following this assessment the Directors have modelled a
severe but plausible downside scenario, where they combined the
default of two key tenants and the failure to let voids, with a
significant increase in Euribor. The forecast shows that the Group
will continue to have sufficient cash resources to meet its
liabilities as they fall due, and will continue to meet its debt
covenants, which are set out in further detail below.
The Group's cash balance at 31 March 2021 was EUR200.1 million.
It also had undrawn amounts under its unsecured revolving credit
facility of a further EUR189.0 million at the date of approval of
these financial statements. Of the Group's total facilities, EUR100
million matures in 2023, EUR100 million in 2024 and EUR225 million
in 2025. The loan includes financial covenants for loan-to-value
("LTV"), interest cover ratio ("ICR") and gearing. These covenants
have been complied with throughout the year and up to the date of
approval of these financial statements.
The LTV covenant is measured quarterly based on the property
valuation as used in the consolidated financial statements. Based
on the valuation as at 31 March 2021 of EUR841.6 million, the Group
retained headroom against a covenant limit, reporting 7% against
the limit of 65%.
The gearing covenant is measured quarterly based on consolidated
total net borrowings to consolidated shareholders' funds. Based on
the most recent reporting the Group retained headroom against the
covenant limit, reporting 8% against the limit of 150%.
The ICR covenant is measured as the ratio of the Group's
consolidated earnings before income and tax, subject to certain
adjustments, to consolidated net finance costs in respect of any
measurement period, by reference to accounting income. Based on the
most recent reporting the Group retained headroom against the
covenant limit, reporting 322% against the limit of 150%.
As a result of the above considerations the Directors have
prepared these financial statements on a going concern basis.
Consequently, the directors are confident that the Group and the
Company will have sufficient funds to continue to meet their
liabilities as they fall due for at least 12 months from the date
of approval of the financial statements and therefore have prepared
the financial statements on a going concern basis.
2. Significant accounting judgements, estimates and assumptions
The preparation of the Group's financial statements requires
management to make judgements, estimates and assumptions that
affect the reported amounts of revenues, expenses, assets and
liabilities and the disclosure of contingent liabilities at the
reporting date. However, uncertainty about these assumptions and
estimates could result in outcomes that require a material
adjustment to the carrying amount of the asset or liability
affected in future periods.
2.1. Judgements
In the process of applying the Group's accounting policies,
management has made the following judgements, which have the most
significant effect on the amounts recognised in the consolidated
financial statements:
Business combinations
The Group acquires subsidiaries that own investment properties.
At the time of acquisition, the Group considers whether each
acquisition represents the acquisition of a business or the
acquisition of an asset. The Group accounts for an acquisition as a
business combination where an acquired set of activities and assets
must include, at a minimum, an input and a substantive process that
together significantly contribute to the ability to create
outputs.
Where such acquisitions are not judged to be the acquisition of
a business, they are not treated as business combinations. Rather,
the cost to acquire the corporate entity is allocated between the
identifiable assets and liabilities of the entity based upon their
relative fair values at the acquisition date. Accordingly, no
goodwill or additional deferred tax relating to pre-acquisition
property valuation gains arises.
In the current period all acquisitions were accounted for as
asset acquisitions as none of the acquisitions included the
acquisition of an integrated set of activities.
Segment reporting
The Directors are of the opinion that the Group is engaged in a
single segment business, being the investment in European Big Box
assets. The Directors consider that these properties have similar
economic characteristics and as a result these individual
properties have been reported as a single operating segment.
2.2. Estimates
Fair valuation of investment property
The fair value of investment property is determined, by an
independent property valuation expert, to be the estimated amount
for which a property should exchange on the date of the valuation
in an arm's length transaction. Properties have been valued on an
individual basis. The valuation expert uses recognised valuation
techniques, applying the principles of both IAS 40 and IFRS 13.
The valuations have been prepared in accordance with the Royal
Institution of Chartered Surveyors ("RICS") Valuation - Global
Standards January 2020 ("the Red Book"). Factors reflected include
current market conditions, annual rentals, lease lengths and
location. The significant methods and assumptions used by valuers
in estimating the fair value of investment property are set out in
note 9.
3. Summary of significant accounting policies
The accounting policies adopted in this report are consistent
with those applied in the Group's consolidated financial statements
for the period ended 30 September 2020 and are expected to be
applied consistently during the year ending 30 September 2021.
3.1. Standards in issue and effective from 1 October 2020
Amendments to IFRS 3 "Business Combinations", definition of a
business
The amendment provides a revised framework for evaluating a
business and introduces an optional "concentration test" and
impacts the assessment and judgements used in determining whether
future property transactions represent an asset acquisition or
business combination. As a result of the amendment it is expected
that future transactions are more likely to be treated as an asset
acquisition.
Amendments to References to the Conceptual Framework in IFRS
Standards were endorsed by the European Commission for use in the
European Union. The Amendments update some of the references and
quotations in IFRS Standards and Interpretations so that they refer
to the revised Conceptual Framework or specify the version of the
Conceptual Framework to which they refer.
There was no material effect from the adoption of other
amendments to IFRS effective in the year. They have no impact to
the Group significantly as they are either not relevant to the
Group's activities or require accounting which is consistent with
the Group's current accounting policies.
3.2. New standards issued but not yet effective
Amendments to IAS 1 on Classification of liabilities as Current
or Non-Current are effective for the financial years commencing on
or after 1 January 2023 and are to be applied retrospectively. It
is not expected that the amendments may have an impact on the
presentation and classification of liabilities in the Group
Statement of Financial Position based on rights that are in
existence at the end of the reporting period.
There are no other standards that are not yet effective that
would be expected to have a material impact on the Group in the
current or future reporting periods and on the foreseeable future
transactions.
4. Gross property income
Six months Six months
ended ended
31 March 31 March
2021 2020
(unaudited) (unaudited)
EURm EURm
-------------------------------------- ------------- -------------
Rental income(1) 19.68 16.15
Spreading of tenant incentives(1) (0.19) 1.26
Amortisation of capital contribution
and lease commission (0.14) -
-------------------------------------- ------------- -------------
Gross rental income 19.35 17.41
-------------------------------------- ------------- -------------
Service charges recoverable 3.67 2.60
Other income 0.19 0.17
-------------------------------------- ------------- -------------
Gross property income 23.21 20.18
-------------------------------------- ------------- -------------
(1) Includes EUR0.5 million received from Covid-19 rent deferred
from the 2019/20 financial year.
The Group derives property income from the following
countries:
Gross property The
income Belgium Germany Spain Italy Poland Netherlands Total
(unaudited) EURm EURm EURm EURm EURm EURm EURm
---------------- ---------- ---------- -------- -------- --------- ------------- --------
Period ended
31 March 2021 2.81 7.33 4.28 3.56 4.31 0.92 23.21
---------------- ---------- ---------- -------- -------- --------- ------------- --------
Period ended
31 March 2020 2.92 6.57 4.18 3.53 2.64 0.34 20.18
---------------- ---------- ---------- -------- -------- --------- ------------- --------
The future minimum lease payments under non-cancellable
operating leases receivable by the Group are as follows:
Less Between Between Between Between
than 1 and 2 and 3 and 4 and More than
1 year 2 years 3 years 4 years 5 years 5 years Total
(Unaudited) EURm EURm EURm EURm EURm EURm EURm
--------------- ----------- --------- --------- --------- --------- ---------- -------
31 March 2021 37.01 36.54 35.81 30.62 28.63 179.79 348.40
--------------- ----------- --------- --------- --------- --------- ---------- -------
31 March 2020 37.14 37.76 37.79 36.87 34.65 205.57 389.78
--------------- ----------- --------- --------- --------- --------- ---------- -------
The Group's investment properties are leased mainly to single
tenants, some of which have guarantees attached, under the terms of
a commercial property lease. The majority have rent indexation that
are linked to either RPI/CPI or fixed uplifts.
There are three tenants representing more than 10% of rental
income during the period (EUR4.03 million, EUR3.10 million and
EUR2.00 million). As at 31 March 2021 and 31 March 2020, three
tenants represented more than 10% of passing rent.
5. Finance expense
Six months Six months
ended ended
31 March 31 March
2021 2020
(unaudited) (unaudited)
EURm EURm
------------------------------------ ------------------------------------ ------------
Interest payable on loans and bank
borrowings 3.07 2.58
Commitment fees payable on bank
borrowings 0.96 0.89
Loss on remeasurement of put option 1.44 0.64
Bank fees 0.10 0.06
Amortisation of loan arrangement
fees 0.33 0.44
------------------------------------ ------------------------------------ ------------
Total finance expense 5.90 4.61
------------------------------------ ------------------------------------ ------------
The total interest payable on financial liabilities carried at
amortised cost comprises interest and commitment fees payable on
bank borrowings of EUR4.03 million (31 March 2020: EUR3.47
million), of which nil was capitalised in both periods. The total
amortisation of loan arrangement fees for 31 March 2021 was EUR0.33
million (31 March 2020: EUR0.44 million), of which EUR0.37 million
(31 March 2020: EUR0.73 million) was capitalised into the loan in
the period (see note 11).
6. Taxation
Tax charge in the Group Statement of Comprehensive Income
Six months Six months
ended ended
31 March 31 March
2021 2020
(unaudited) (unaudited)
EURm EURm
------------------------- ------------ ------------
Current taxation:
UK taxation - -
Overseas taxation(1) 3.43 0.14
Deferred taxation:
UK taxation - -
Overseas taxation 5.17 5.21
------------------------- ------------ ------------
Total tax change 8.60 5.35
------------------------- ------------ ------------
(1) Includes the capital gains tax on disposal of investment
properties for EUR3.04 million.
The UK corporation tax charge of EURnil reflects the Company's
intention to declare sufficient "qualifying interest distributions"
to fully offset its "qualifying interest income" in the period, in
accordance with its status as an Investment Trust Company
("ITC").
7. Earnings per share
Earnings per share ("EPS") amounts are calculated by dividing
profit for the period attributable to ordinary equity holders of
the Group by the weighted average number of Ordinary Shares in
issue during the period. As at 31 March 2021 there are no dilutive
or potentially dilutive equity arrangement in existence.
The calculation of EPS is based on the following:
Weighted
Net profit average
attributable number of
to Ordinary Ordinary Earnings
Shareholders Shares(1) per share
For the period ended 31 March 2021 (unaudited) EURm '000 Cent
----------------------------------------------- ------------------- ------------ ------------
Basic EPS 32.63 446,013 7.32
Adjustments to remove:
Deferred tax charge (note 6) 5.17
Current tax charge on disposal (note
6) 3.04
Changes in fair value of investment
properties (note 9) (26.38)
Changes in fair value of interest rate
derivatives (note 13) 0.01
Gain on disposal of investment properties (7.38)
----------------------------------------------- ------------------- ------------ ------------
EPRA EPS 7.09 446,013 1.59
----------------------------------------------- ------------------- ------------ ------------
Adjustments to include/(exclude):
Rental income recognised in respect
of fixed uplifts (0.34)
Amortisation of capital contribution
and lease commission 0.14
Rental income deferred(3) 0.53
Rental guarantee receipts excluded from
property income-settled via cash (2) 0.86
Rental guarantee receipts excluded from
property income-settled via contracted
liability settlement (2) 0.28
Amortisation of loan arrangement fees 0.33
Unrealised foreign exchange currency
loss (0.08)
Loss on remeasurement of put option 1.44
----------------------------------------------- ------------------- ------------ ------------
Adjusted EPS 10.25 446,013 2.30
----------------------------------------------- ------------------- ------------ ------------
1 Based on the weighted average number of Ordinary Shares in
issue throughout the period.
2 This is offset against the cost of investment properties.
3 Covid-19 rent deferred from the 2019/20 financial year collected
during the period.
The calculation of EPS is based on the
following:
Weighted
Net (loss)/profit Average
attributable number of
to Ordinary Ordinary Earnings
Shareholders Shares(1) per share
For the period ended 31 March 2020 (unaudited) EURm '000 Cent
----------------------------------------------- ------------------- ------------ --------------
Basic EPS 22.47 422,727 5.32
Adjustments to remove:
Deferred tax charge 5.21
Changes in fair value of investment
properties (note 9) (19.35)
Changes in fair value of interest rate
derivatives (note 13) (0.07)
Gain on disposal of investment properties (0.81)
----------------------------------------------- ------------------- ------------ --------------
EPRA EPS 7.45 422,727 1.76
----------------------------------------------- ------------------- ------------ --------------
Adjustments to include/(exclude):
Licence fee receivable on forward funded
developments 0.50
Rental income recognised in respect
of fixed uplifts (1.26)
Rental guarantee receipts excluded from
property income-settled via cash (2) 1.15
Rental guarantee receipts excluded from
property income-settled via contracted
liability settlement (2) 0.54
Amortisation of loan arrangement fees 0.44
Unrealised foreign exchange currency
loss 0.03
Loss on remeasurement of put option 0.64
----------------------------------------------- ------------------- ------------ --------------
Adjusted EPS 9.49 422,727 2.25
----------------------------------------------- ------------------- ------------ --------------
1 Based on the weighted average number of Ordinary Shares in
issue throughout the period.
2 This is offset against the cost of investment properties.
Adjusted Earnings is a performance measure used by the Board to
assess the level of the Group's dividend payments. The metric
mainly adjusts EPRA earnings for:
i. Exclusion of non-cash items credited or charged to the Group
Statement of Comprehensive Income, such as fixed rental uplift
adjustments and amortisation of loan arrangement fees;
ii. Inclusion of licence fees which relates to cash received
from developers during development periods, in order to access the
land; and
iii. Inclusion of rental guarantee adjustments relate to
acquired assets with properties which have had an income guarantee
attached to them as part of the acquisition of the asset. The
rental guarantee is released (through a cash movement or contracted
liability settlement) as adjusted earnings over the period of the
lease which it is intended to cover or lease break - however, this
release does not go through rental income in the Group Statement of
Comprehensive Income, and as such an adjustment is made to
recognise the receipt.
8. Dividends paid
Six months Six months
ended ended
31 March 31 March
2021 2020
(unaudited) (unaudited)
EURm EURm
---------------------------------------- ------------- -------------
Final dividend in respect of period
ended 30 September 2020 at 1.10
cent per Ordinary Share (30 September
2019: 1.00 cent) 4.65 4.23
First interim dividend in respect
of year ended 30 September 2021
at 1.25 cent per Ordinary Share
(30 September 2019: 1.10 cent) 5.28 4.65
---------------------------------------- ------------- -------------
Total dividends paid 9.93 8.88
---------------------------------------- ------------- -------------
Total dividends paid per share for 2.35 cent 2.10 cent
the period
---------------------------------------- ------------- -------------
Total dividends unpaid but declared 1.25 cent 1.10 cent
per share for the period
---------------------------------------- ------------- -------------
Total dividends declared per share 2.50 cent 2.20 cent
for the period
---------------------------------------- ------------- -------------
On 18 May 2021, the Directors of the Company declared a second
interim dividend in respect of the year ended 30 September 2021 of
1.25 cent per Ordinary Share, which will be payable on or around 18
June 2021 to Shareholders on the register on 28 May 2021.
Out of EUR12.98 million dividends declared for the period,
EUR1.81 million is designated as interest distribution.
9. Investment properties
The Group's investment property has been valued at fair value by
Jones Lang LaSalle Limited ("JLL"), an accredited independent
valuer with a recognised and relevant professional qualification
and with recent experience in the locations and categories of the
investment properties being valued. The valuations have been
prepared in accordance with the RICS Valuation - Global Standards
January 2020 ("the Red Book") and incorporate the recommendations
of the International Valuation Standards which are consistent with
the principles set out in IFRS 13. In forming its opinion, JLL
makes a series of assumptions, which are typically market related,
such as net initial yields and expected rental values and are based
on the Valuer's professional judgement and the current tenancy of
the properties.
The valuations are the ultimate responsibility of the Directors.
Accordingly, the critical assumptions used in establishing the
independent valuation are reviewed by the Board.
All corporate acquisitions during the period have been treated
as asset purchases rather than business combinations.
During the period, the following investment properties was
acquired:
Location Date acquired
Nivelles, Belgium(1)
29 January 2021
(1) Acquired based on asset deal.
Investment Investment Investment
properties properties properties
completed under construction Total
(Unaudited) EURm EURm EURm
------------------------------------------- ------------ ------------------- ------------
As at 1 October 2020 837.90 - 837.90
Acquisition of properties(1) 31.80 - 31.80
Improvements to investment properties 1.03 - 1.03
License fees and rental guarantees
recognised (1.21) - (1.21)
Disposal of properties (56.97) - (56.97)
Development expenditure - 1.65 1.65
Fixed rental uplift and tenant lease
incentives 2 1.39 - 1.39
Amortisation on rental uplift and tenant
lease incentives 2 (0.33) - (0.33)
Reclassification from completed investment
properties to investment properties
under construction (3.10) 3.10 -
Change in fair value during the period
3 26.22 0.16 26.38
------------------------------------------- ------------ ------------------- ------------
As at 31 March 2021 836.73 4.91 841.64
------------------------------------------- ------------ ------------------- ------------
Investment
Investment properties Investment
properties under properties
completed construction Total
--------------------------------------
(Audited) EURm EURm EURm
-------------------------------------- ----------- ------------- -----------
As at 1 October 2019 665.75 21.83 687.58
Acquisition of properties(1) 105.86 - 105.86
Improvements to investment properties 1.43 - 1.43
License fees and rental guarantees
recognised (3.90) - (3.90)
Development expenditure - 6.22 6.22
Transfer from investment properties
under construction to completed 28.05 (28.05) -
Fixed rental uplift and tenant lease
incentives 2 2.57 - 2.57
Amortisation on rental uplift and
tenant lease incentives 2 (0.43) - (0.43)
Change in fair value during the
period 3 38.57 - 38.57
-------------------------------------- ----------- ------------- -----------
As at 30 September 2020 837.90 - 837.90
-------------------------------------- ----------- ------------- -----------
1 Included acquisition costs of EUR0.80 million (30 September 2020: EUR2.27 million).
2 This balance arises as a result of the IFRS treatment of
leases with fixed or minimum rental uplifts and rent free periods,
which requires the recognition of rental income on a straight line
basis over the lease term. The amount as at 31 March 2021 was
EUR5.20million (30 September 2020: EUR6.23 million). The difference
between this and cash receipts changes the carrying value of the
property against which revaluations are measured (also see note
6).
3 Included in the fair value change in the period were
unrealised gains of EUR28.19 million (30 September 2020: EUR53.93
million) and unrealised losses of EUR1.81 million (30 September
2020: EUR15.36 million).
30 September
31 March 2021 2020
EURm EURm
--------------------------------------------- ------------- ------------
Investment properties in Balance Sheet 841.64 837.90
Rental guarantee held in separate receivable 1.74 1.41
--------------------------------------------- ------------- ------------
Total external valuation of investment
properties 843.38 839.31
--------------------------------------------- ------------- ------------
As at 31 March 2021, the Group had the following capital
commitments in relation to its forward funded pre--let development
assets for EUR50.6 million (30 September 2020: EUR44.0
million):
-- Bornem of EUR5.6 million
-- Strykow of EUR13.5 million subject to pre-let conditions being met
-- Mango extension EUR31.5 million subject to permit
These costs are not provided for in the Statement of Financial
Position. Capital commitments represent costs to bring the asset to
completion under the developer's funding agreements which include
the developer's margin.
Valuation and real estate risks
There is risk to the fair value of real estate assets that are
part of the portfolio of the Group, comprising variation in the
yields that the market attributes to the real estate investments
and the market income that may be earned.
Real estate investments can be impacted adversely by external
factors such as the general economic climate, supply and demand
dynamics in the market, competition and increase in operating
costs.
Besides asset specific characteristics, general market
circumstances affect the value and income from investment
properties such as the cost of regulatory requirements related to
investment properties, interest rate levels and the availability of
financing.
The Manager of the Group has implemented a portfolio strategy
with the aim to mitigate the above stated real estate risk. By
diversifying in regions, risk categories and tenants, it is
expected to lower the risk profile of the portfolio.
As of the date of this Interim Report, the only investments of
the Group that have been identified consist of the current
portfolio as specified in the management report. While the Group is
negotiating to acquire further properties, there is no guarantee
that these properties will form part of the portfolio of the
Group.
With respect to new investments, management will be targeting
specific investment categories based on the Group's investment
objective and restrictions. Because such investments may be made
over a substantial period of time, the Group faces the risk of
interest rate fluctuations in case of leveraging these investments
and adverse changes in the real estate markets.
Fair value hierarchy
The Group considers that all of its investment properties and
investment properties under construction fall within Level 3 of the
fair value hierarchy as defined by IFRS 13. There have been no
transfers between Level 1 and Level 2 during any of the periods,
nor have there been any transfers between Level 2 and Level 3
during any of the periods.
The valuations have been prepared on the basis of Market Value
("MV"), which is defined in the RICS Valuation Standards, as:
"The estimated amount for which a property should exchange on
the date of valuation between a willing buyer and a willing seller
in an arm's length transaction after proper marketing wherein the
parties had each acted knowledgeably, prudently and without
compulsion."
MV as defined in the RICS Valuation Standards is the equivalent
of fair value under IFRS.
The following descriptions and definitions relating to valuation
techniques and key unobservable inputs made in determining fair
values are as follows:
Valuation techniques
Investment properties completed: income approach
The income method (or income approach) quantifies the net
present value of future benefits associated with the ownership of
the asset by totalling the current tenancy of the property,
followed by the demand market rent on lease expiry, capitalised at
an appropriate yield.
Investment properties under construction: residual approach
The residual approach for properties under construction takes
the expected valuation of the finished property using the income
approach and deducts forecast costs to complete the development and
an allowance for developer's profit.
Unobservable input: estimated rental value ("ERV")
The range of rent per square metre, per annum at which space
could be let in the market conditions prevailing at the date of
valuation at 31 March 2021: EUR40.73--EUR86.30 (30 September 2020:
EUR32.10--EUR84.97).
ERV is dependent upon a number of variables in relation to the
Group's property. These include: size, building specification and
location.
Unobservable input: net initial yield
The net initial yield is defined as the initial net income as a
percentage of the market value (or purchase price as appropriate)
plus standard costs of purchase: average: 4.35%* or range: 3.65%-
6.13% (30 September 2020: average: 4.57%* or range: 3.91%-6.25%).
Net initial yield is dependent on the tenant, lease length and the
other variables listed above for ERV.
Net initial yield and ERV are not necessarily independent
variables. It is possible a change in one assumption may result in
an offsetting change to the other but equally the change in both
assumptions may increase the impact on valuation.
Sensitivities of measurement of significant unobservable
inputs
As set out within significant accounting estimates and
judgements above, the Group's property portfolio valuation is open
to estimation uncertainty and is inherently subjective in
nature.
As a result the following sensitivity analysis has been prepared
for investment properties :
+0.25%
-0.25% net net initial -0.50% +0.50%
initial yield ERV ERV
yield EURm EURm EURm EURm
-------------------------------- ----------- ------------ ------- -----------------
(Decrease)/increase in the fair
value of investment properties
as at 31 March 2021 46.48 (41.83) (21.81) 20.85
--------------------------------- ----------- ------------ ------- -----------------
(Decrease)/increase in the fair
value of investment properties
as at 30 September 2020 48.56 (43.41) (20.03) 20.03
--------------------------------- ----------- ------------ ------- -----------------
* Including rental guarantee
The JLL valuation includes deductions for transaction costs that
would be incurred by a hypothetical purchaser at the valuation
date. These costs include Real Estate Transfer Tax (RETT)
equivalent to stamp duty except for properties in Italy, Poland and
Belgium. In the former, this is due to Italy being an Investment
Management Company (SGR), in Poland, RETT is not applicable and in
Belgium, the local valuation practice is to exclude such costs
given the prevalence of corporate rather than asset transactions in
these markets.
10. Trade and other receivables
31 March 30 September
2021 2020
(unaudited) (audited)
Non-current trade and other
receivables EURm EURm
----------------------------- ------------- -------------
Cash in public institutions 1.17 1.17
----------------------------- ------------- -------------
The cash in public institutions is a deposit of EUR1.17 million
given by the tenant for the property in Barcelona, Spain.
31 March 30 September
2020
2021 (audited)
(unaudited) EURm
Current trade and other receivables EURm
-------------------------------------- ------------- ------------
Trade receivables 1.51 2.52
Prepayments, accrued income and other
receivables 4.90 5.92
Escrow cash 1.21 0.39
VAT receivable* 4.78 5.89
-------------------------------------- ------------- ------------
12.40 14.72
-------------------------------------- ------------- ------------
* VAT receivable relates mainly to VAT reclaim due on the
purchase of the property in Italy EUR3 million (30 September 2020:
EUR4 million).
11. Loans and borrowings
As at 31 March 2021, all of the Group's debt facility
commitments are floating term. The LTV across all drawn debt was 7%
against a target of 45% (with a limit of 65% in the RCF). The Group
has been in compliance with all of the financial covenants of the
Group's bank facilities as applicable throughout the period covered
by these financial statements.
The Group had available headroom of EUR165.00 million under its
bank borrowings (30 September 2020: EUR81.00 million).
Any associated fees in arranging the loan and borrowings that
are unamortised as at the period end are offset against amounts
drawn on the facilities as shown in the table below:
31 March
30 September
2021 2020
(unaudited) (audited)
EURm EURm
--------------------------------------------- ------------ -------------------------
Bank borrowings at the beginning of the
period 340.63 231.95
Bank borrowings drawn in the period 180.00 121.00
Bank borrowings repaid in the period (264.00) (12.50)
Loan issue costs paid (0.37) (0.74)
Non-cash amortisation of loan issue costs 0.33 0.92
--------------------------------------------- ------------ -------------------------
Non-current liabilities: loan and borrowings 256.59 340.63
--------------------------------------------- ------------ -------------------------
Maturity of loans and borrowings 31 March 2021 (unaudited)
---------------------------------------
Total debt
Drawn Undrawn available
EURm EURm EURm
Repayable between one and two years - - -
Repayable between two and three years 61.17 38.83 100.00
Repayable between three and four
years 61.18 38.82 100.00
Repayable between four and five years 137.65 87.35 225.00
Repayable in over five years - - -
--------------------------------------------- ------------ ------- ----------------
260.00 165.00 425.00
--------------------------------------------- ------------ ------- ----------------
Maturity of loans and borrowings 30 September 2020 (audited)
---------------------------------------
Drawn Undrawn Total debt
EURm EURm available
EURm
--------------------------------------------- ------------ ------- ----------------
Repayable between one and two years - - -
Repayable between two and three years - - -
Repayable between three and four
years 80.94 19.06 100.00
Repayable between four and five years 263.06 61.94 325.00
Repayable in over five years - - -
--------------------------------------------- ------------ ------- ----------------
344.00 81.00 425.00
--------------------------------------------- ------------ ------- ----------------
12. Other liabilities
The Group's properties in Germany are held in subsidiaries in
which the Group holds 94.9% or 89.9% of the shares. As part of the
purchase agreements, the Group issued put options to the minority
shareholders. The options are exercisable ten years after
acquisition and would require the Group to acquire all shares held
by the minority shareholder at the then market value. Prior to the
option date the Group has guaranteed a fixed dividend to the
minority shareholder. If this is not met by the subsidiary, then
the Company is required to settle this obligation.
13. Derivative financial instruments
To mitigate the interest rate risk that arises as a result of
entering into variable rate loans, a number of interest rate caps
have been taken out in respect of the Group's variable rate debt to
cap the rate to which three month Euribor can rise. Each cap runs
coterminous to the initial term of the respective loans.
As at the period end the Group had notional value of interest
rate caps of EUR300 million to act as a hedge against the EUR425
million revolving credit facility.
The weighted average capped rate, excluding any margin payable,
for the Group as at the period end was 0.67%. The total premium
payable in the period towards securing the interest rate caps was
EURnil (30 September 2020: EURnil).
31 March 30 September
2021 2020
(unaudited) (audited)
EURm EURm
---------------------------------------------- ------------ ------------
Interest rate derivatives valuation brought
forward 0.09 0.12
Fair value movement (0.01) (0.03)
---------------------------------------------- ------------ ------------
Non-current assets: interest rate derivatives
carried forward 0.08 0.09
---------------------------------------------- ------------ ------------
The interest rate derivatives are marked to market by the
relevant counterparty banks on a quarterly basis in accordance with
IFRS 9. Any movement in the mark-to-market values of the
derivatives are taken to the Group profit or loss.
As at the period end date the total proportion of debt hedged
via interest rate derivatives equated to 115% (30 September 2020:
87%).
Fair value hierarchy
The fair value of the Group's interest rate derivatives is
recorded in the Group Statement of Financial Position and is
determined by forming an expectation that interest rates will
exceed strike rates and discounting these future cash flows at the
prevailing market rates as at the period end. This valuation
technique falls within Level 2 of the fair value hierarchy, as
defined by IFRS 13. The valuation was provided by the counterparty
to the derivatives. There have been no transfers between Level 1
and Level 2 during any of the periods, nor have there been any
transfers between Level 2 and Level 3 during any of the
periods.
14. Financial risk management
Financial instruments
The Group's principal financial assets and liabilities are those
that arise directly from its operations: trade and other
receivables, trade and other payables and cash held at bank. The
Group's other principal financial assets and liabilities are bank
borrowings and interest rate derivatives, the main purpose of which
is to finance the acquisition and development of the Group's
investment property portfolio and hedge against the risk of
interest rates rising. The book value of the Group's financial
instruments that are carried in the financial statements
approximates their fair value at the end of the period.
Risk management
The Group is exposed to market risk (including interest rate
risk) and credit risk. The Board of Directors oversees the
management of these risks. The Board of Directors reviews and
agrees policies for managing each of these risks that are
summarised below.
Market risk
Market risk is the risk that the fair values of financial
instruments will fluctuate because of changes in market prices. The
financial instruments held by the Group that are affected by market
risk are principally the Group's cash balances and bank borrowings
along with interest rate derivatives entered into to mitigate
interest rate risk.
The Group monitors its interest rate exposure on a regular
basis. A sensitivity analysis performed to ascertain the impact on
the Group Cash Flow Statement and net assets which shows that a 50
basis point decrease/increase in interest rates would result in an
increase of EURnil or a increase of EUR0.27 million to net assets,
based on the nominal borrowings at the period end.
The Group currently operates in seven countries. The current
distribution of total assets is as follows:
Total assets Belgium Germany Spain Italy Poland UK The Netherlands Total
------------------- -------- -------- ------- ------- ------- ------- ---------------- ---------
31 March
2021 (unaudited) 129.92 318.23 171.60 142.58 87.94 148.16 57.23 1,055.66
------------------- -------- -------- ------- ------- ------- ------- ---------------- ---------
30 September
2020
(audited) 93.01 303.63 169.12 141.52 117.39 4.37 50.43 879.47
------------------- -------- -------- ------- ------- ------- ------- ---------------- ---------
Credit risk
Credit risk is the risk that a counterparty will not meet its
obligations under a financial instrument or customer contract,
leading to a financial loss. The Group is exposed to credit risks
from both its leasing activities and financing activities,
including deposits with banks and financial institutions.
Credit risk is mitigated by tenants being required to pay
rentals in advance under their lease obligations. The credit
quality of the tenant is assessed based on an extensive credit
rating scorecard at the time of entering into a lease agreement or
acquiring a let property. The Group holds collateral by way of bank
deposits totalling EUR1.17 million (see note 10).
Covid-19 increased the tenant credit risk of the Group, with
some tenants asking for rent deferrals with a view to help their
financial position. However, as at 31 March 2021, all deferrals
have been repaid as agreed with one single deferral outstanding
agreed to be received during the year for EUR0.9 million.
Outstanding trade receivables are regularly monitored. The
maximum exposure to credit risk at the reporting date is the
carrying value of each class of financial asset less the collateral
held.
15. Share capital
The share capital relates to amounts subscribed for share
capital at its nominal value:
Ordinary Shares 31 March 31 March 30 September 30 September
2021 2021 2020 2020
Number EURm Number EURm
----------------------------- ------------ --------- ------------- -------------
Issued and fully paid
at 1 cent each
Balance at beginning of
period - EUR0.01 Ordinary
Shares 422,727,273 4.23 422,727,273 4.23
Shares issued in the period 192,633,688 1.92 - -
----------------------------- ------------ --------- ------------- -------------
Balance at end of period 615,360,961 6.15 422,727,273 4.23
----------------------------- ------------ --------- ------------- -------------
The Group has one class of Ordinary Shares which carry no right
to fixed income.
On 10 March 2021, the Group increased its share capital by
another 192,633,688 Ordinary Shares for GBP1.03 each. As a result,
the Group's issued share capital increased to 615,360,961 Ordinary
Shares with voting rights.
On 26 September 2018, the Group cancelled 57,100 redeemable
preference shares with a nominal value of EUR57,100. The preference
shares did not carry any rights to a dividend.
On 25 September 2018, the Group by way of Special Resolution
cancelled the then value of its share premium, by an Order of the
High Court. As a result of this cancellation, EUR329.54 million
were transferred from the share premium account into distributable
reserves.
16. Net asset value (NAV) per share
Basic NAV per share is calculated by dividing net assets in the
Group Statement of Financial Position attributable to ordinary
equity holders of the Parent by the number of Ordinary Shares
outstanding at the end of the period. As there are no dilutive
instruments outstanding basic NAV per share is shown below:
30 September
2020
31 March
2021 (unaudited) (audited)
EURm EURm
--------------------------------------------
Net assets per Group Statement of Financial
Position 751.67 503.91
Ordinary Shares:
Issued share capital (number) 615,360,961 422,727,273
NAV per share (expressed in Euro per share)
-------------------------------------------- ----------------- ------------
Basic NAV per share 1.22 1.19
-------------------------------------------- ----------------- ------------
In October 2019, EPRA introduced three new measures of net asset
value: EPRA Net Reinvestment Value (NRV), EPRA Net Tangible Assets
(NTA) and EPRA Net Disposal Value (NDV). These are applicable for
accounting periods starting on or after 1 January 2020, but the
Group has elected to early adopt these new measures for the year
ended 30 September 2020. The Group considers EPRA NRV to be the
most relevant EPRA NAV measure for the Group, replacing our
previously reported EPRA NAV and EPRA NAV per share metrics. We are
now reporting EPRA NRV as our primary NAV measure alongside Basic
NAV.
31 March 2021 30 September 2020
EPRA NRV EPRA NTA EPRA NDV EPRA NRV EPRA NTA EPRA NDV
EURm EURm EURm EURm EURm EURm
-------- -------- -------- -------- -------- --------
NAV attributable
to shareholders 751.67 751.67 751.67 503.91 503.91 503.91
-------- -------- -------- -------- -------- --------
Mark-to-market adjustments
of derivatives (0.08) (0.08) - (0.09) (0.09) -
-------- -------- -------- -------- -------- --------
Deferred tax adjustment 17.69 17.69 - 12.49 12.49 -
-------- -------- -------- -------- -------- --------
Transaction costs(1) 36.12 - - 34.19 - -
-------- -------- -------- -------- -------- --------
NAV 805.40 769.28 751.67 550.50 516.31 503.91
-------- -------- -------- -------- -------- --------
NAV per share in
Euro 1.31 1.25 1.22 1.30 1.22 1.19
-------- -------- -------- -------- -------- --------
(1) EPRA NTA and EPRA NDV reflect IFRS values which are net of
RETT (real estate transfer tax). RETT are added back when
calculating EPRA NRV.
17. Transactions with related parties
For the period ended 31 March 2021, all Directors and some of
the Members of the Manager are considered key management personnel.
The terms and conditions of the Investment Management Agreement are
described in the Management Engagement Committee Report. The fee
payable to the Manager for the period to 31 March 2021 was EUR2.34
million (31 March 2020: EUR2.07 million).
The total amount outstanding at the period end relating to the
Investment Management Agreement was EUR1.16 million (30 September
2020: EUR1.10 million).
The total amounts paid to Directors for their services for the
period to 31 March 2021 was EUR0.1 million (31 March 2020: EUR0.1
million).
On 1 October 2020, there were three new Members of the Manager,
namely Nick Preston, Frankie Whitehead and James Watson. On 1
February 2021, Alasdair Evans and Phil Redding were also appointed
as new Members of the Manager. They are also Members of SG
Commercial. The other six Members of the Manager, namely Mark Shaw,
Colin Godfrey, James Dunlop, Henry Franklin, Petrina Austin and
Bjorn Hobart, are also Members of SG Commercial LLP. No fees were
payable to SG Commercial in the period ended 31 March 2021 (31
March 2020: EURnil) in respect of agency services. The agency fees
payable to SG Commercial LLP represents 0% (31 March 2020: 0%) of
the agency fees payable by the Group during the period. There were
no fees outstanding as at 31 March 2021 and 30 September 2020.
During the period the Directors received the following
dividends: Robert Orr: EUR470 (31 March 2020: EUR420), Keith
Mansfield: EUR6,815 (31 March 2020: EUR4,990), Taco De Groot:
EUR588 (31 March 2020: EUR525) and Eva-Lotta Sjostedt: EUR135 (31
March 2020: EURnil).
During the period the Members of the Manager received the
following dividends: Colin Godfrey: EUR3,951 (31 March 2020:
EUR2,835), Mark Shaw: EUR3,973 (31 March 2020: EUR2,835), James
Dunlop: EUR3,951 (31 March 2020: EUR2,835), Henry Franklin:
EUR2,689 (31 March 2020: EUR1,901), Petrina EUR632 (31 March 2020:
EUR452) and Nick Preston EUR2,293 (31 March 2020: EUR1,410).
On 3 December 2020 the Manager has acquired in the market 94,777
Ordinary Shares at 103.82 pence per share on behalf of certain
member of staff of the Manager.
18. Subsequent events
On 1 April 2021 the Group announced that it has agreed the
purchase of two assets in Germany for a total consideration of
EUR290.9 million excluding acquisition costs.
There were no other significant events occurring after the
reporting period, but before the financial statements were
authorised for issue.
NOTES TO EPRA NAV CALCULATIONS (UNAUDITED)
In October 2019, EPRA issued new best practice recommendations
(BPR) for financial guidelines on its definitions of NAV measures:
EPRA net tangible assets (NTA), EPRA net reinvestment value (NRV)
and EPRA net disposal value (NDV). The Group has adopted these new
guidelines and applies them in the 2020 Annual Report. The Group
considered EPRA net reinvestment value (NRV) to be the most
relevant NAV measure for the Group, replacing our previously
reported EPRA NAV and EPRA NAV per share metrics. We are now
reporting EPRA NRV as our primary NAV measure alongside Basic NAV.
EPRA NRV is calculated as net assets per the Consolidated Statement
of Financial Position excluding cumulative fair value adjustments
for debt-related derivatives and deferred tax adjustment, and
including transaction costs (Real Estate Transfer Tax and
purchaser's costs).
Previously reported
31 March 2021 Current measures measures
---------------------------- -------------------------------- ----------------------
EPRA EPRA EPRA
NRV NTA EPRA NDV NAV EPRA NNNAV
EURm EURm EURm EURm EURm
---------------------------- ---- ------- ------- --------- -------- ------------
NAV attributable
to shareholders 751.67 751.67 751.67 751.67 751.67
Mark-to-market adjustments
of derivatives (0.08) (0.08) - 2.39 -
Deferred tax adjustment 17.69 17.69 - 17.69 -
Transaction costs(1) 36.12 - - - -
NAV 805.40 769.28 751.67 771.75 751.67
---------------------------------- ------- ------- --------- -------- ------------
NAV per share in
Euro 1.31 1.25 1.22 1.30 1.22
---------------------------------- ------- ------- --------- -------- ------------
(1) EPRA NTA and EPRA NDV reflect IFRS values which are net of
transaction costs (RETT and purchaser's costs). Transaction costs
are added back when calculating EPRA NRV .
Previously reported
30 September 2020 Current measures measures
---------------------------- --------------------------- ----------------------
EPRA EPRA EPRA
NRV NTA EPRA NDV NAV EPRA NNNAV
EURm EURm EURm EURm EURm
---------------------------- ------- ------- --------- -------- ------------
NAV attributable
to shareholders 503.91 503.91 503.91 503.91 503.91
Mark-to-market adjustments
of derivatives (0.09) (0.09) - 2.38 -
Deferred tax adjustment 12.49 12.49 - 12.49 -
Transaction costs(1) 34.19 - - - -
NAV 550.50 516.31 503.91 518.78 503.91
----------------------------- ------- ------- --------- -------- ------------
NAV per share in
Euro 1.30 1.22 1.19 1.23 1.19
----------------------------- ------- ------- --------- -------- ------------
(1) EPRA NTA and EPRA NDV reflect IFRS values which are net of
transaction costs (RETT and purchaser's costs). Transaction costs
are added back when calculating EPRA NRV .
Previously reported
31 March 2020 Current measures measures
---------------------------- --------------------------- ----------------------
EPRA EPRA EPRA
NRV NTA EPRA NDV NAV EPRA NNNAV
EURm EURm EURm EURm EURm
---------------------------- ------- ------- --------- -------- ------------
NAV attributable
to shareholders 490.88 490.88 490.88 490.88 490.88
Mark-to-market adjustments
of derivatives (0.19) (0.19) - 2.28 -
Deferred tax adjustment 9.81 9.81 - 9.81 -
Transaction costs(1) 31.45 - - - -
NAV 531.95 500.50 490.88 502.97 490.88
----------------------------- ------- ------- --------- -------- ------------
NAV per share in
Euro 1.26 1.18 1.16 1.19 1.16
----------------------------- ------- ------- --------- -------- ------------
(1) EPRA NTA and EPRA NDV reflect IFRS values which are net of
transaction costs (RETT and purchaser's costs). Transaction costs
are added back when calculating EPRA NRV .
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