To:
Company Announcements
Date:
31 January 2019
Company: F&C UK Real
Estate Investments Limited
LEI:
231801XRCB89W6XTR23
Subject:
Net Asset Value
Net Asset Value
The unaudited net asset value per share of F&C UK Real
Estate Investments Limited (“FCRE”) as at 31
December 2018 was 106.0 pence.
This represents a decrease of 1.2 per cent from the net asset value
per share as at 30 September 2018 of
107.3 pence and a NAV total return
for the quarter of -0.1 per cent
The net asset value is based on the external valuation of the
Group's property portfolio prepared by Cushman & Wakefield.
The net asset value is calculated under International Financial
Reporting Standards ("IFRS").
The net asset value includes all income to 31 December 2018 and is calculated after
deduction of all dividends paid prior to that date. It does
not include a provision for the dividend for the quarter to
31 December 2018, which is expected
to be paid in March 2019.
Share Price
The share price was 92.2 pence per
share at 31 December 2018, which
represented a discount of 13.0 per cent to the NAV per share
announced above. The share price total return for the quarter was
-2.1 per cent.
Breakdown of NAV movement
Set out below is a breakdown of the change to the unaudited net
asset value per share calculated under IFRS over the period from
30 September 2018 to 31 December 2018.
|
Pence per share |
% of opening NAV |
Net asset value per share as at 30
September 2018 |
107.3 |
|
Unrealised movement in valuation of
property portfolio (including the effect of gearing) |
(1.3) |
(1.2)* |
Movement in revenue reserves |
- |
- |
Net asset value per share as at
31 December 2018 |
106.0 |
(1.2) |
* The un-geared decrease in the valuation of the property
portfolio over the quarter to 31 December
2018 was 0.9%.
The net gearing as at 31 December
2018 was 26.3% #
# Bank debt (less net current assets) divided by fair value of
investment properties
Performance
The capital value of the portfolio decreased by 0.9 per cent
over the quarter, compared to the 0.2 per cent fall in the MSCI UK
Monthly Index over the same period. The retail market remains under
pressure with the vast majority of subsectors experiencing falls in
valuation over the quarter, reflecting both ongoing challenges
within the occupier markets and weak investor sentiment. The
All Retail index recorded capital falls of 3.3 per cent at the
market level over the quarter. While the Company does not hold any
shopping centres or department stores, this impact was felt across
the High Street portfolio with a 3.2 per cent fall in values. The
decrease in value in the portfolio’s retail warehouse assets of 1.5
per cent was primarily attributable to the property at Northfields,
Rotherham, let to Homebase which has been subject to a CVA.
The positive capital return derived from the portfolio’s Rest of
UK Office segment was as a result of successful asset management
initiatives at the property at Standard Hill, Nottingham. 38
per cent of the portfolio comprises Industrial assets located
within the south east. These assets experienced capital growth over
the period of 0.6 per cent.
At the period end the portfolio void rate was 4.0 per cent by
ERV and the average weighted unexpired lease term was 6.1
years.
Portfolio Analysis |
£m |
% of portfolio as at 31
December 2018 |
% capital value
movement in quarter |
Offices |
89.0 |
25.6 |
(1.0) |
West End |
28.2 |
8.1 |
- |
South East |
28.2 |
8.1 |
(3.6) |
Rest of UK |
32.6 |
9.4 |
0.5 |
Industrial |
132.6 |
38.2 |
0.6 |
South East |
132.6 |
38.2 |
0.6 |
Standard Retail |
55.9 |
16.1 |
(3.2) |
West End |
8.4 |
2.4 |
- |
Rest of London |
3.3 |
0.9 |
(4.3) |
South East |
17.3 |
5.0 |
(1.4) |
Rest of UK |
26.9 |
7.8 |
(5.1) |
Retail Warehouse |
69.8 |
20.1 |
(1.5) |
Rest of UK |
60.1 |
17.3 |
(2.1) |
Rest of London |
9.7 |
2.8 |
2.6 |
Total Property |
347.3 |
100.0 |
(0.9) |
Property Purchases and Sales
There were no sales or purchases in the quarter.
Summary Balance Sheet
|
£m |
Pence per
share |
% of Net
Assets |
Property Portfolio per Valuation
Report |
347.3 |
144.3 |
136.1 |
Adjustment for lease incentives |
(4.2) |
(1.7) |
(1.6) |
Fair Value of Property
Portfolio |
343.1 |
142.6 |
134.5 |
Cash |
9.4 |
3.9 |
3.7 |
Trade and other receivables |
5.7 |
2.4 |
2.3 |
Trade and other payables |
(6.7) |
(2.8) |
(2.7) |
Interest-bearing loans |
(96.4) |
(40.1) |
(37.8) |
Net Assets at 31
December 2018 |
255.1 |
106.0 |
100.0 |
The property portfolio will next be valued by an external valuer
during March 2019 and the net asset
value per share as at 31 March 2019
will be announced in April 2019.
This announcement contains inside information.
Enquiries:
The Company Secretary
Northern Trust International Fund Administration Services
(Guernsey) Limited
Trafalgar Court
Les Banques
St Peter Port
Guernsey
GY1 3QL
Tel: 01481 745001
Fax: 01481 745051
Peter Lowe
Scott Macrae
F&C Investment Business Ltd
Tel: 0207 628 8000
Fax: 0131 225 2375