NewRiver REIT PLC Q4 Company Update (0380W)
13 April 2023 - 4:00PM
UK Regulatory
TIDMNRR
RNS Number : 0380W
NewRiver REIT PLC
13 April 2023
NewRiver REIT plc
("NewRiver" or the "Company")
Trading Update - Resilient Performance and Strategic
Progress
NewRiver is today providing a trading update for the year ended
31 March 2023 ahead of the announcement of its Full Year Results in
June 2023.
-- Resilient operational metrics with increased occupancy and strong
leasing performance
-- Asset management mandate with M&G Real Estate expanded, taking
the total number of assets managed under this arrangement to 16
retail parks and two shopping centres
-- Work Out portfolio exit on track with two disposals completed in
Q4 equating to 23% of September 2022 Work Out portfolio by valuation
-- Portfolio valuation decline of c.4.7% in H2 representing a significant
outperformance versus the MSCI Monthly Index(1) ; continued resilience
from Core Shopping Centres and Retail Parks, Regeneration assets
impacted by increases in development cost assumptions
-- Balance sheet strength maintained with LTV expected to remain in-line
with September 2022 at c.34%, no maturity on drawn debt until 2028,
no exposure to interest rate rises on drawn debt, and increased
cash & cash equivalents of c.GBP111 million
-- FY23 Underlying Funds From Operations ('UFFO') per share and EPRA
Net Tangible Assets ('NTA') per share expected to be in-line with
analyst consensus(2)
Resilient operational performance
-- High, stable retail occupancy at 31 March 2023 of 96.7% (30 September
2022: 96.3%)
-- Average rent remains affordable at 31 March 2023 at GBP11.98 per
sq ft (30 September 2022 GBP11.58 per sq ft), with the occupational
affordability for our tenants set to further improve from 1 April
2023 when reduced business rates become effective
-- Rent collection for Q1-Q4 FY23 currently stands at 98% of rent
demanded
-- 979,200 sq ft of new lettings and renewals agreed in FY23 with
long-term transactions on average 1.1% ahead of ERV, 9.7% ahead
of previous rent and with a Weighted Average Lease Expiry of 8.2
years
Expanded capital partnerships
-- As previously disclosed, and aligned with our strategic aim to
use our specialist retail platform to enhance earnings in a capital
light way by working in partnership with institutions and other
capital providers, in November 2022 NewRiver was appointed by M&G
Real Estate to manage a UK portfolio of 16 retail parks and one
shopping centre
-- Following a successful first quarter of the mandate, and further
demonstrating the growth potential embedded within our specialist
retail platform, in April 2023 NewRiver was appointed by M&G Real
Estate to manage an additional shopping centre located in the South
East of England, taking the total number of assets managed under
this arrangement to 16 retail parks and two shopping centres
Disposal target delivered
-- Completed GBP23 million of disposals since 30 September 2022, the
majority of which relates to the sale of two assets from the Work
Out portfolio during Q4, meaning we have achieved our FY23 Work
Out disposal target
-- Work Out portfolio now represents only 11% of the NewRiver portfolio
which we have targeted selling or completing turnaround strategies
on by the end of FY24
Portfolio valuation outperformance
-- The independent valuers have concluded their work on NewRiver's
property portfolio as at 31 March 2023, valuing the portfolio at
GBP594 million, with the reduction in H2 due to a c.4.7% reduction
in capital values and GBP23 million of completed disposals
-- Core Shopping Centres, representing 37% of the total portfolio,
were broadly stable in H2 and Retail Parks, representing 28% of
the total portfolio, recorded a modest c.3.5% decline due to market
driven yield movement, partially offset by positive ERV growth
-- The majority of the reduction in capital values was focused on
the Regeneration portfolio, which has been impacted by higher estimated
development costs as a result of the inflationary environment
Strong balance sheet position
-- Cash & cash equivalents increased to c.GBP111 million at 31 March
2023 (30 September 2022: GBP95 million) through completed disposals
and continued operational strength
-- LTV at 31 March 2023 is expected to be in-line with the 34% reported
as at 30 September 2022
-- Fully unsecured balance sheet with interest rate fixed at 3.5%
on drawn debt and no maturity on drawn debt until March 2028
-- Cost of debt compares to portfolio Topped-up Net Initial Yield
of 8.0% as at 31 March 2023, one of the highest spreads in the
real estate sector
1. Latest available MSCI Monthly Index data covering 5 months
ended 28 February 2023. Capital reduction for All Property -16.8%,
All Retail -13.1%, Shopping Centres -8.7%, Retail Parks -13.2%.
2. Current analyst consensus for 31 March 2023 UFFO is GBP25.0
million / 8.1 pence per share, comprising six analyst forecasts
ranging from GBP22.5 million to GBP28.0 million / 7.3 pence per
share to 9.1 pence per share. Current analyst consensus for 31
March 2023 EPRA NTA per share is 123 pence per share, comprising
six analyst forecasts ranging from 113 pence per share to 131 pence
per share.
For further information
+44 (0)20 3328
NewRiver REIT plc 5800
Allan Lockhart (Chief Executive)
Will Hobman (Chief Financial Officer)
Lucy Mitchell (Communications
& Investor Relations)
+44 (0)20 7251
FGS Global 3801
Gordon Simpson
James Thompson
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
the law of England and Wales by virtue of the European Union
(Withdrawal) Act 2018. This announcement has been authorised for
release by the Board of Directors.
About NewRiver
NewRiver REIT plc ('NewRiver') is a leading Real Estate
Investment Trust specialising in buying, managing and developing
resilient retail assets throughout the UK.
Our GBP0.6 billion UK wide portfolio covers 7 million sq ft and
comprises 26 community shopping centres and 14 conveniently located
retail parks occupied by tenants predominately focused on essential
goods and services. Our objective is to own and manage the most
resilient retail portfolio in the UK, focused on retail parks, core
shopping centres, and regeneration opportunities in order to
deliver long term attractive recurring income returns and capital
growth for our shareholders.
NewRiver has a Premium Listing on the Main Market of the London
Stock Exchange (ticker: NRR). Visit www.nrr.co.uk for further
information.
LEI Number: 2138004GX1VAUMH66L31
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