TIDMAEWL
RNS Number : 1178C
AEW UK Long Lease REIT PLC
06 February 2020
The information contained in this announcement is restricted and
is not for publication, release or distribution in the United
States of America, any member state of the European Economic Area
(other than the United Kingdom, the Republic of Ireland or the
Netherlands), Canada, Australia, Japan or the Republic of South
Africa.
6 February 2020
AEW UK Long Lease REIT plc
("AEWL", the "Company" or the "Group")
NAV, DIVIDEND DECLARATION AND UPDATE FOR THE QUARTER ENDED 31
DECEMBER 2019
NOTICE OF HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER
2019
The Board of Directors of AEW UK Long Lease REIT plc (ticker:
AEWL), the owner of a diversified portfolio of 19 regional UK
commercial property assets let on long leases, announces the
following update for the quarter ended 31 December 2019.
The Board today declared an interim dividend of 1.375 pence per
share for the quarter ended 31 December 2019. The dividend will be
paid on 28 February 2020 to shareholders on the register on 14
February 2020. The ex-dividend will be 13 February 2020. This
dividend will be a Property Income Distribution ("PID"). In line
with the Group's Dividend Payment Policy, the Board is targeting an
aggregate dividend of 5.50 pence per share for the year ending 30
June 2020 (1) .
Later this month, the Board will announce the actions it is
taking to reduce the Group's costs with the objective of delivering
a fully cash covered dividend with effect from the financial year
commencing 1 July 2020, and the Board confirms that AEW UK's tenure
as investment manager will cease on 9 April 2020.
Highlights for the quarter ended 31 December 2019
-- Unaudited EPRA earnings per share ("EPRA EPS") for the
quarter increased by 12.9% to 1.523 pence per share, which
represents dividend cover for the quarter of 110.8% (quarter to 30
September 2019: 1.348 pence per share, 98.0% cover).
o The EPRA EPS includes an accrual to reflect the minimum
contracted uplifts under the Group's leases and a non-cash
adjustment for the amortisation of loan arrangement fees. Excluding
these adjustments from EPRA EPS, the unaudited cash earnings were
1.201 pence per share, reflecting 87.3% cash dividend cover for the
quarter (quarter ended 30 September 2019: 1.022 per share, 74.3%
cash dividend cover).
-- At 31 December 2019, the independent fair valuation of the
property portfolio was GBP112.99 million (30 September 2019:
GBP113.06 million), a decrease over the quarter of GBP0.07 million
(0.06%) (quarter to 30 September 2019: increase of GBP0.07 million
or 0.06% over prior quarter).
-- Unaudited Net Asset Value ("NAV") increased 0.15% over the
period to GBP76.17 million, 94.627 pence per share (30 September
2019: GBP76.06 million, 94.482 pence per share). Please see table
below for NAV movement during the quarter.
-- The weighted average unexpired lease term to first break or
expiry was 20.0 years and 22.1 years to expiry.
Notice of results
The Company will announce its unaudited half year results for
the six months ended 31 December 2019 on 26 February 2020.
Net Asset Value
As at 31 December 2019, the Group owned 19 investment properties
with a fair value of GBP112.99 million.
Movement during the quarter Pence per GBP million
share
NAV at 1 October 2019 94.482 76.06
Valuation change in property portfolio
* (0.003) (0.00)
Income earned for the period 2.338 1.88
Expenses for the period (0.371) (0.30)
Net finance costs for the period (0.444) (0.36)
Interim dividend paid in respect
of the quarter ended 30 September
2019 (1.375) (1.11)
NAV at 31 December 2019 94.627 76.17
* The quarter's reduction in the independent fair valuation of
GBP0.07 million was offset by a reversal of a capital expenditure
provision of GBP0.36 million and the quarter's recurring rent
smoothing charge of GBP0.29 million.
The NAV attributable to the ordinary shares has been calculated
under International Financial Reporting Standards as adopted by the
European Union and incorporates both the Group's property portfolio
individually valued on a 'Red Book' valuation basis as at 31
December 2019 and net income for the quarter, but does not include
a provision for the interim dividend for the quarter ended 31
December 2019.
The income earned for the period includes an accrual for the
minimum contractual uplifts defined within the index linked leases.
In the event that inflation is greater than these minimum
contractual uplifts, the actual income will be greater than that
currently accrued.
Debt
The Group has drawn all of its GBP41 million fixed interest loan
facility with Canada Life Investments and at 31 December 2019 was
geared at a loan to Gross Asset Value ("GAV") of 34.5%. The
weighted average interest cost of the Group's facility is 3.19% and
the facility is repayable on 20 October 2025. The Company's
medium-term target for its loan to GAV is 30%.
Inflation linked rent reviews
92% of the portfolio's income stream is reviewed periodically,
on an upward only basis, in line with inflation; with 71% and 21%
of the portfolio indexed (subject to floors and caps) to RPI and
CPI, respectively.
Rent reviews reflecting inflation linked uplifts during the
period include assets let to Prime Life in Solihull and Brough
where rent is set to increase by 2.4% as compared to the previous
year.
Sector weightings
The sector weightings, by value, of the property portfolio as at
31 December 2019: Hotels 21.1%; Industrial 20.0%; Residential care
homes 16.0%; Car showrooms 13.1%; Student accommodation 10.8%;
Leisure 8.6%; Power station 4.7%; Petrol station 3.9%; and Nursery
1.8%.
Notes
1 Investors should note that any dividend targets are for
illustrative purposes only, based on current market conditions and
is not intended to be, and should not be taken as, a profit
forecast or estimate. Actual returns cannot be predicted and may
differ materially from this illustrative figure. There can be no
assurance that the target will be met or that any dividend or total
return will be achieved.
2 Neither the content of the Company's website, nor the content
on any website accessible from hyperlinks on its website for any
other website, is incorporated into, or forms part of, this
announcement nor, unless previously published by means of a
recognised information service, should any such content be relied
upon in reaching a decision as to whether or not to acquire,
continue to hold, or dispose of, securities in the Company.
ENQUIRIES
AEWL
Steve Smith - Chairman via Maitland/AMO below
------------------------------
Maitland/AMO (Communications
Adviser)
------------------------------
James Benjamin james.benjamin@maitland.co.uk
+44(0) 20 7379 5151
------------------------------
Cenkos
------------------------------
Will Rogers wrogers@cenkos.com
+44(0) 20 7397 1920
------------------------------
Rob Naylor rnaylor@cenkos.com
+44(0) 20 7397 1922
------------------------------
The Company's LEI is 213800MPBIJS12Q88F71.
Further information on AEW UK Long Lease REIT is available at:
www.aewukllreit.com (2)
About AEW UK Long Lease REIT
AEW UK Long Lease REIT plc aims to generate a sustainable,
secure and attractive income return for shareholders, whilst
maintaining capital values in real terms, from a diversified
portfolio of UK property investments, predominately in alternative
and specialist sectors. The majority of the assets in the Company's
portfolio are let on long leases which contain inflation linked
rent review provisions, which help to underpin income distributions
to shareholders with the potential for income and capital
growth.
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END
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