31 Jan 2019 07:00
F&C UK Real Estate Investments Ltd - Net Asset Value(s)F&C UK Real Estate Investments Ltd - Net Asset Value(s)
PR Newswire
London, January 30
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 SecretaryNorthern Trust International Fund Administration Services (Guernsey) LimitedTrafalgar CourtLes BanquesSt Peter PortGuernseyGY1 3QLTel: 01481 745001Fax: 01481 745051Peter LoweScott MacraeF&C Investment Business LtdTel: 0207 628 8000Fax: 0131 225 2375