TIDMNRR
RNS Number : 0542L
NewRiver REIT PLC
14 July 2017
NewRiver REIT plc First Quarter Company Update
14 July 2017
Successful equity raise and value creation across our
convenience-led portfolio
David Lockhart, Chief Executive commented: "In the context of
continued political uncertainty, the highlight of what has been
another busy and successful period for the Company was our
significantly over-subscribed GBP225 million equity raise, which
was completed at a 15% premium to March 2017 net asset value.
Following the equity raise, we have seen continued momentum across
the business, having exchanged contracts to acquire the remaining
units in our BRAVO JV for GBP59.4 million, and made substantial
progress across our risk-controlled development pipeline, most
recently obtaining planning consent for our major mixed-use
regeneration in Cowley, Oxford. Operationally, our convenience-led,
community-focused retail & leisure portfolio continues to
deliver sustainable and growing cash returns, giving us the
confidence to increase our first quarter dividend by 5% to 5.25
pence per share.
Looking ahead, we have significant firepower which we will
deploy into accretive acquisition opportunities and our inbuilt
risk-controlled development pipeline. We believe that with our
proven business model and increased scale we are well-placed to
continue to deliver growing and sustainable cash returns to our
shareholders."
Successfully raised GBP225 million of equity to deploy into
accretive acquisitions and risk-controlled developments
-- Significantly over-subscribed equity raise priced at 335
pence per share, representing a 14.7% premium to March 2017 EPRA
NAV (292 pence per share) and a 2.9% discount to the 20 day average
closing price(1)
-- Placing announced on 15 June 2017 and 67,164,179 new ordinary
shares admitted to trading on the London Stock Exchange on 6 July
2017, taking the total number of voting rights in the Company to
301,332,893
-- Exchanged conditional contracts to acquire the remaining 50%
share in BRAVO JVs for a cash consideration of GBP59.4 million;
allows NewRiver to gain control over 4 convenience-led shopping
centre assets in Belfast, Glasgow, Hastings and Middlesbrough with
a gross asset value of GBP240 million, and a topped-up net initial
yield of 7.3%
-- Remaining equity to be deployed into pipeline of accretive
acquisitions and risk-controlled developments
Substantial progress made on 1.9 million sq ft risk-controlled
development pipeline
-- Planning consent obtained for a 236,000 sq ft mixed-use
development scheme in Cowley, Oxford to regenerate Templars Square
shopping centre, creating 226 new residential apartments, a 71-bed
budget hotel, 2 new restaurant units, modernised car parks and a
major improvement of the public realm
-- 62,000 sq ft retail park in Canvey Island, Essex, now 71%
pre-let (75% including deals in solicitors' hands), increased from
52% reported in March 2017 results with M&S Foodhall joining
B&M and Sports Direct; now significantly de-risked and expected
to start on-site by the end of the Summer
-- Planning consent obtained for 38,000 sq ft hotel in Romford,
Greater London; 100% pre-let to Premier Inn
-- Further progress made on rolling convenience store programme,
with one further c-store completed meaning 12 delivered to the
Co-operative to date, with 4 currently under construction
Growing and sustainable cash returns underpinned by
convenience-led, community-focused portfolio
-- First quarter dividend increased by 5% to 5.25 pence per
share (Q1 FY17: 5.00 pence) payable on 4 August 2017
-- Proforma for the BRAVO acquisition, NRR share of portfolio
increased to GBP1.25 billion (March 2017: GBP1.13 billion)
-- High level of retail occupancy sustained at 97% (March 2017: 97%)
-- 71 leasing events across 224,000 sq ft of retail space; long
term deals on average +0.7% vs March 2017 ERV
-- Affordable average rent of GBP12.63 per sq ft (March 2017: GBP12.45 per sq ft)
-- Footfall across the shopping centre portfolio +0.1% on a
like-for-like basis vs Q1 FY17, outperforming the UK benchmark by
90bps
Crystallising value for shareholders through profitable capital
recycling of mature assets
-- GBP20.0 million of disposals completed on average 5% ahead of
March 2017 valuation and representing an average net initial yield
of 5.9%; these assets were acquired at net initial yields of
7.8%-11.0%
-- High Street unit in Newcastle sold for GBP6.9 million, 5%
above March 2017 valuation and realising an ungeared IRR of 10%
having acquired the asset in September 2010 for GBP4.4 million
-- Big Box retail unit in Warrington sold to Primark for GBP8.0
million, 3% ahead of March 2017 valuation and realising an ungeared
IRR of 11% since acquisition in November 2012
Increased balance sheet scale providing investment capacity and
benefitting ongoing refinancing exercise
-- Proforma Loan to value of 25% (March 2017: 37%) including the
effects of GBP225 million equity raise and subsequent GBP59.4
million acquisition of remaining BRAVO JV units
-- Significant progress made on debt refinancing exercise, with
timetable accelerated by increased balance sheet scale; aim to
become an unsecured borrower with key objectives including a
reduced cost of debt, increased flexibility and an increased debt
maturity; expect to complete in H1 FY18 with minimal breakage
costs
Notes
(1) The average closing share price over the 20 trading days up
to and including 14 June 2017 adjusted for FY17 special dividend
(3.0 pence per share) and the FY18 Q1 ordinary dividend (5.25 pence
per share).
For further information
NewRiver REIT plc +44 (0)20 3328 5800
David Lockhart (Chief Executive)
Mark Davies (Chief Financial Officer)
Will Hobman (Head of Investor Relations)
Bell Pottinger +44 (0)20 3772 2500
David Rydell
Eve Kirmatzis
This announcement contains inside information as defined in
Article 7 of the EU Market Abuse Regulation No 596/2014 and has
been announced in accordance with the Company's obligations under
Article 17 of that Regulation.
About NewRiver
NewRiver REIT plc (ticker: NRR) is a premium listed REIT on the
London Stock Exchange and a constituent of the FTSE 250 and EPRA
indices. The Company is a specialist real estate investor, asset
manager and developer focused solely on the UK retail and leisure
sector.
Founded in 2009, NewRiver is one of the UK's largest
owner/managers of convenience-led shopping centres with assets
under management of GBP1.3 billion principally comprising 33 UK
wide shopping centres together with further nationwide retail and
leisure assets. The portfolio totals 8 million sq. ft. with over
2,000 occupiers, an annual footfall of 150 million and a retail
occupancy rate of 97 per cent.
Visit www.nrr.co.uk for further information. LEI number:
2138004GX1VAUMH66L31
Forward-looking statements
The information in this announcement may include forward-looking
statements, which are based on current projections about future
events. These forward-looking statements reflect the directors'
beliefs and expectations and are subject to risks, uncertainties
and assumptions about NewRiver REIT plc (the "Company"), including,
amongst other things, the development of its business, trends in
its operating industry, returns on investment and future capital
expenditure and acquisitions, that could cause actual results and
performance to differ materially from any expected future results
or performance expressed or implied by the forward-looking
statements.
None of the future projections, expectations, estimates or
prospects in this announcement should be taken as forecasts or
promises nor should they be taken as implying any indication,
assurance or guarantee that the assumptions on which such future
projections, expectations, estimates or prospects have been
prepared are correct or exhaustive or, in the case of the
assumptions, fully stated in the document. As a result, you are
cautioned not to place reliance on such forward looking statements
as a prediction of actual results or otherwise. The information and
opinions contained in this announcement are provided as at the date
of this document and are subject to change without notice. No one
undertakes to update publicly or revise any such forward looking
statements. No statement in this document is or is intended to be a
profit forecast or profit estimate or to imply that the earnings of
the Company for the current or future financial years will
necessarily match or exceed the historical or published earnings of
the Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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