Stefan Bernstein explains how the EU/Greenland critical raw materials partnership benefits GreenRoc. Watch the full video here.
In the Debt Financing and Gearing Section unrestricted cash is stated as Ā£25.7m,whereas in the Financial Resources Section it is Ā£30.2m .Why the difference?
58 āassetsā are up for sale totalling Ā£130m.Is an asset the same as a property ? They have 144 properties valued at Ā£700m.So they are selling the smaller stuff,basically.Bigger stuff will have to be used to repay the institutional lenders.
A dump to get the bond covered.No bad thing.But Ā£100m+ needed to get out of the Straight- jacket.
LTV covenants are not published in the RGL annual report for any borrowing facility.Covenants can be amended- temporarily or permanently- at any time by mutual agreement.How an LTV covenant is calculated could vary for each facility.Certain properties,such as unoccupied,might be excluded,for example.Typical covenant level is 60%.With an LTV of 55% RGL has not much flexibility.All guess work as RGL does not disclose useful information of this type.Slippery or what?
Someone panicking?
A revised management contract was agreed for 12 months in June 2023.And what have the Property Advisers achieved in that time? Sweet FA.
Surely,they should be chucked out? Do the Board have the guts to do that? Surely they should be interviewing alternative candidates ? Or are they all in it together to hide their mutual inadequacies and protecting their fee stream and the existing contract will just be rolled over.The Biard has a fiduciary duty to shareholders.Lets be seeing it.
Shareholders deserve better.
As if by magicā¦..
And who believes that falling out of the EPRA index is the only reason for a 30% share fall?
Might it be because shareholders consider the Board is lazy and inept? Or that the Managers and Directors are just lining their pockets without providing adequate value to shareholders.If the Board had any backbone they would change the managers at the next opportunity.If Institutional shareholders had any joint imagination they would get the whole business sold at one go.The Board and current advisers are highly unlikely to go down an immediate full business sale route as it will cut off their fees.In theory,the primary duty of care of the Directors is to shareholders.One wonders if the current mob understand their legal responsibilities.
Share price is down 30% in last month.What do we hear from the Board and its advisers.Sweet FA.Maybe soon we will get an excited announcement that they have sold a flat.Cannot believe that Insitutional Investors have not demanded change to make these useless folks earn their money.
Should anyone try to call the Investor relations chap,quoted on the RNS,they have quoted the wrong telephone number.The correct number is 02038319700.Anyone surprised?
You might not like it,but voting against an equity raising would guarantee shareholders would lose everything.
An orderly win down cannot happen unless the bond is refinanced.No time. Equity value is retainable with decent breathing space.
Once the equity raising rumour is out there unless the company comments they would be creating a false market in the shares.Forced to announce.
But,this is the time to lobby the corporate advisers to change the Board and get Inglis off it.
You might not like it,but voting against an equity raising would guarantee shareholders would lose everything.
An orderly win down cannot happen unless the bond is refinanced.No time. Equity value is retainable with decent breathing space.
Once the equity raising rumour is out there unless the company comments they would be creating a false market in the shares.Forced to announce.
But,this is the time to lobby the corporate advisers to change the Board and get Inglis off it.
Says everything and nothingā¦..but forced on the company because of impact on equity price of an equity raising.
Unfortunately,RGL do not publish covenant ratios as some other reits do,so you cannot see how close they are to individual facility limits.My point about valuations is that they are based an open market situation.When you are a forced seller ,as RGL is to the buyer market,and when the market itself is very depressed with a glut of properties available,particularly those in non- prime locations, book values may not be achievable in the short term.An equity raise would give more time both for the market to improve , for more properties to be refurbished to higher category levels and for interest rates to fall.
Do I believe that another manager should be appointed to RGL.Absolutely.Should the Board be replaced .Absolutely.Both have brought RGL to its knees.
A well-written ,informative report.Positive detail on MySpace in the next few months and a fully covered dividend should underpin a gradual share price rise.
Jonarian
Some good stuff in your comments and we all want it to turn out well for shareholders,and by default ,bondholders.
The difficulty for analysts is that RGL has traditionally been run by folks who do not seee corporate governance as very important and they have never had pressures from institutional shareholders to remove the conflicts that are obvious to shareholders.You see this sort of behaviour in the VCT world,less know than a few years back.It is totally nonsense to have anyone from the Managers on the board.It is a reflection of a feeble board that this happens.When a fund is initially set up ,usually by the Managers, they invite board members who they think will be compliant.What may change the game here is that ARA the recent owners of the Inglis business are professional and experienced and if you want to right to RGL and the Board then ask for your email to be forwarded to ARA compliance department.
More debt is not the solution.LTV is too high.Again, the real estate industry protects its own.In dependent valuers ha ha.Who pays their fees? These valuations are based on certain factors ( ask to see them ).I paraphrase but is based on an active market,willing buyers and sellers,etc.RGL is a distressed seller,no?So big discount.office values are not going up.Look at Derwent and CLS.RGL selling at Book value.ha ha.Look at what the purchase value was.Businesses write down values of properties they want to sell so they can then say they did not make a book loss against recent valuations.
It is highly likely that they have breached LTV covenants.But have waivers for the short term.
The 20% unoccupied is a killer.which other REIT has that? These boys have previously announced asset sales.We have heard nothing recently.
There may be a big asset package sale in the offing which will refi the bond and improve leverage.Can you see the flying pigs?
I would be delighted to see an equity raise.
Still nervousness about the ability to complete on the local housing stuffā¦.and the lost income.
We assume that Edison has access to company info or at least an audience as RGL is paying them to promote RGL To their credit,my interpretation is that they think RGL needs a rescue ( my words) share raising.Of course it does.Been blatantly obvious for months.The Board has been effing useless listening to Inglis saying he can sort it.Left it far too late.New Board required.Sack Inglis and the other padding and particularly the chairman who has demonstrated no backbone or strategic skills.Best thing for shareholders is for ARA to step up and get cash into the company from serious investors.Sooner rather than later.
Letās hope the new CEO at QSix concentrates on getting a serious disposal programme in place bearing in mind the huge fees shareholders have paid for feeble performance to date.Sale of the whole business would be preferable but that would cut off their annual income.Bit of a conflict.Board needs to grow a pair.
Excellent news.Repaying expensive debt.Sharebuy back programme should improve share price.Great long term hold for the divi.
If the Board had a deal in place to refi the bond by the divi day announcement,they would presumably have said so?
Good to see rises in bond and share prices.There are buyers for the bonds at current levels.
Cancelling the dividend would have sent the wrong message to potential new money providers?
Significant asset sales still required in the shorter term unless values increase,imho.
Paying the divi should signal there are no concerns about the ability to repay the bond in August.If the Board were more open with shareholders about why they are that confident ,then the price of the bonds and shares would undoubtedly rise.They have withheld how much free cash is currently available ,unlike in the Q3 update.With an LTV of 55%, surely most of the portfolio must now be pledged to the institutional lenders? Where will Ā£50m come from? Letās hope that on 26 March relevant information will be made available.In the meantime both the bond and share prices reflect the uncertainty brought about by the poor communication from RGL.
Chelmoās analysis is feeble.There is something weird going on here.With a debt LTV of 55% there is bound to be a potential debt covenant default,probably temporarily waived.Or not.No Board with any brain would pay a dividend now if full payout for the bonds was in any doubt.Unfortunately,RGL board is ,in my opinion,not of that caliber.Insiders and fluff.Obviously holding back material information which distorts markets.Bonds are listed.Lets hope that ARA are not complicit in market distortion through lack of material disclosure despite the Inglis philosophy of accidentally omitting financial information which might assist bondholders/ shareholders from understanding the true financial position.Bonds would not trade at current levels if RGL disclosed professionally.Why are they not doing this? They need to be very careful.If bonds are not paid out in full in August, after paying a Ā£6m divi, the capital markets will show no mercy to The Board and their advisersā¦.
404
It is not RGL choice on the bonds.They have to be repaid in August,just like a loan,unless bondholders agree to extend.
A competent Board and Investment Manager ought to be able to sort this out within 6 months.I have no confidence in either,but I do believe that ARA ought to have the skills and motivation to get RGL stabilised.Preferably kicking out Inglis and the RGL chairman in the process.