Helical Bar Regulatory News (HLCL)

26 November 2015

HELICAL BAR PLC

("Helical" or the "Group" or the "Company")

Half Year Results for the Six Months to 30 September 2015

STRONG RETURNS & PATH SET FOR FUTURE GROWTH

Michael Slade, Chief Executive, commented:

"Our portfolio is primarily targeted towards London for capital growth and development profits, and the regions for high yielding investment assets and trading profits. London continues to deliver strong returns and the Company is looking to increase its commitment to London by retaining its refurbishment schemes at C-Space, Charterhouse Square and, most notably, The Bower. Our larger balance sheet and our belief that the London office market will show continued growth has encouraged the Company to increase its exposure to locations which we believe will outperform.

"I have been Chief Executive of Helical since 1984 and one of its major shareholders for most of that period. In July 2016, at the next AGM, I will hand over the reins to Gerald Kaye, my fellow director for the past 21 years. I have been asked to take over from Nigel McNair Scott, our current Chairman, when he retires at next year's AGM and I am delighted to be able to continue to be part of the Helical story."

Financial Highlights

Record half year results

· EPRA net asset value per share up 13.2% to 436p (31 March 2015: 385p).

· EPRA earnings per share up 145% to 13.0p (2014: 5.3p).

· IFRS profit before tax of £85.9m (2014: £42.9m) - up 100%.

· Total Property Return of £107.6m (2014: £69.2m) - up 55%.

- Group's share of net rental income of £20.8m (2014: £18.8m).

- Development profits of £18.7m (2014: £15.6m).

- Net gain on sale and revaluation of investment properties of £68.1m (2014: £34.8m).

· Interim dividend of 2.30p (2014: 2.10p) per share - up 9.5%.

Growing capital returns

· Group's share of property portfolio £1,066m (31 March 2015: £1,021m).

· Investment property valuations, on a like-for-like basis, up 11.8% (8.8% including sales and purchases) with London office valuations up 20.3% (18.1% including sales and purchases).

Strong financial position

· See-through loan to value of 31% (31 March 2015: 34%) on a secured basis and 49% overall (31 March 2015: 52%).

· Average maturity of the Group's share of debt of 4.3 years (31 March 2015: 4.3 years) at an average cost of 3.8% (31 March 2015: 4.1%).

· Group's share of cash and undrawn bank facilities at 30 September 2015 of £224m (31 March 2015: £229m).

Operational Highlights

London portfolio boosting performance

· 18.1% valuation increase of London investment portfolio (2014: 9.2%), now valued at £417m (47% of total investment portfolio).

· Contracted gross rents on London portfolio of £10.8m compared to ERV of £29.8m.

· At The Bower, Old Street, London EC1, the offices in The Warehouse are 92% let. Empire House was sold for £20.65m in November.

· Post half year end, Helical exchanged contracts to buy the offices at The Bower from the joint venture for £248m, while joint venture partner Crosstree will acquire the retail parade for £23m.

· At Barts Square, London EC1, One Bartholomew Close, a 211,000 sq ft office site, was sold for £102.4m and the redevelopment was forward funded, releasing £34m cash to Helical.

· At Barts Square, London EC1, 93 residential units are now exchanged on Phase One out of 144 released.

Regional portfolio performance benefits from increased investment in distribution warehouses

· Contracted gross rents on regional investment portfolio of £31.6m (53% of total investment portfolio).

· Regional investment portfolio increased with the purchase of £71m of high yielding distribution warehouses.

· Regional investment portfolio now comprises 12% offices, 18% in town retail and retail parks, 22% industrial/logistics and 1% other (see page 11).

Board Changes (also refer to separate announcement today)

· Michael Slade to step down as Chief Executive at 2016 AGM and remain on the Board as Non-Executive Chairman.

· Gerald Kaye to be appointed Chief Executive from 2016 AGM.

· Nigel McNair Scott, Chairman, and Andy Gulliford, non-executive director, to retire at the 2016 AGM.

· Helical to appoint up to two additional non-executive directors to provide further independence and balance to the Board.

For further information, please contact:

Half Year Results Presentation

Helical will be holding a presentation for analysts and investors at 10:45am (GMT), Thursday 26 November 2015 at Andaz Hotel, 40 Liverpool Street, London EC2M 7QN. If you would like to attend, please contact Clare Glynn at FTI +44 (0) 20 3727 1883 or clare.glynn@fticonsulting.com

The presentation will be on the Company's website www.helical.co.uk and a conference call facility will be available. The dial-in details are as follows:

Financial Highlights

Notes

1. Includes Group's share of income and gains of its subsidiaries and joint ventures. See Note 25.

2. Calculated in accordance with IAS 33 and guidance issued by the European Public Real Estate Association ("EPRA").

EPRA earnings per share exclude the net gain on sale and revaluation of the investment portfolio of £68.1m (2014:

£34.8m) but include development profits of £18.7m (2014: £15.6m).

3. Includes the Group's share of assets and liabilities of its subsidiaries and joint ventures. See Note 25.

4. See-through loan to value is the ratio of see-through net borrowings to see-through property portfolio. See

Note 26.

5. See-through net gearing is the ratio of see-through net borrowings to net assets. See Note 26.

6. See-through Net Asset Value gearing is the ratio of see-through net borrowing to EPRA Net Asset Value. See

Note 26.

Chief Executive's Statement

Overview

Helical's portfolio is primarily targeted towards London for capital growth and development profits, and the regions for high yielding investment assets and trading profits.

London continues to deliver strong returns and the Company is looking to increase its commitment to London by retaining its development and refurbishment schemes at C-Space, Charterhouse Square and most notably at The Bower. Retaining the completed projects, which historically might have been sold by Helical, is a "step-change" for the Company. Our larger balance sheet and our belief that the London office market will show continued growth has encouraged the Company to increase its exposure to locations which we believe will continue to outperform. At the same time we have de-risked parts of our London portfolio through the sale of assets where we can redeploy the proceeds more profitably, for example the sale of Clifton Street and, since the half year, Enterprise House and Artillery Lane. In addition, we have sold the office site at One Bartholomew Close, and forward funded the ongoing development with a profit share upon successful letting. Our success in letting the majority of the first phase prior to completion of building works at The Bower, held in a joint venture, has encouraged us to acquire, from the joint venture, the three office buildings at The Bower, comprising The Warehouse, The Studio and The Tower. This acquisition will increase Helical's London holdings to c. 55% of its investment portfolio.

Our confidence in the future of London offices is underpinned by a number of factors:

· The population of London is anticipated to grow by c. 100,000 per annum over the next ten years.

· Oxford Economics predicts that 200,000 new office jobs will be created which will require c. 20 million sq ft of office space.

· Considerable number of office buildings and potential office development sites have changed use to residential.

· Macro-economic factors such as GDP and employment figures are supportive of the capital's growth over the coming years.

Our regional portfolio continues to provide a stream of growing net rents following the switch in 2014/15 from shopping centres to high yielding distribution warehouses, offices and out of town retail parks. In addition, our retirement village and retail development programmes contribute development profits.

Results for the half year

The IFRS profit before tax for the half year to 30 September 2015 was £85.9m, an increase of 100% on last half year's pre-tax profit of £42.9m. Total property return increased by 55% to £107.6m (2014: £69.2m), reflecting growing net rents of £20.8m (up 11% from £18.8m last year) and development profits of £18.7m (2014: £15.6m). The gain on sale and revaluation of the investment portfolio contributed £68.1m (2014: £34.8m).

Recurring administration costs were £5.8m (2014: £5.2m) and performance-related awards and associated costs were £8.7m (2014: £7.7m). Net finance costs were £12.1m (2014: £12.4m) with a credit arising from the valuation of the Group's derivative financial instruments of £0.1m (2014: a charge of £1.8m) and a credit arising from valuing the Group's £100m Convertible Bond of £48,000 (2014: £1.6m).

EPRA earnings, a measure which excludes the gain on sale and revaluation of investment properties and associated deferred tax and the movement in fair value of derivative financial instruments, was £14.9m (2014: £6.5m). EPRA earnings per share were 13.0p (2014: 5.3p). EPRA net asset value per share increased by 13.2% to 436p (31 March 2015: 385p).

The London Portfolio

We have continued to make excellent progress in our London investment and development programme with lettings at record rents in many of our assets and significant progress in the letting of new space in our developments.

At The Bower, Old Street, EC1, we have agreed to purchase from our joint venture with Crosstree Real Estate Partners LLP, the two completed office buildings (The Warehouse and The Studio), as well as The Tower, a major refurbishment opportunity. With Empire House sold to Standard Life and Crosstree acquiring the remaining asset, the retail parade, the joint venture will cease on completion of the transactions in January 2016. Helical will then own a mixed use estate with numerous exciting opportunities where Phase One of c. 151,000 sq ft is 92% let with the remaining space under offer, demonstrating its appeal to occupiers. Phase Two, the refurbishment of The Tower, will start in December 2015 and is due for completion Q4 2017.

At Barts Square, EC1, our scheme in joint venture with The Baupost Group LLC, we have exchanged contracts on 93 of the 144 residential units in Phase One of the development, which commenced in January 2015 and is due for completion in summer 2017. The second part of the residential element at Barts Square, a further 92 units, is expected to start in late 2016 for Q4 2018 delivery. During the half year to 30 September 2015, the joint venture sold the office site at One Bartholomew Close for £102.4m to clients of Ashby Capital LLP who will fund the ongoing development, and the joint venture will receive a 50% share in profits upon the successful letting of the building.

At other London office investments, the refurbishments of C-Space, EC1, One King Street, Hammersmith, W6, and Artillery Lane, E1, have completed. This latter completion triggered the completion of the sale of the building to Standard Life in October. Since the half year we have sold Enterprise House, W2, for £43m, a premium of 10% on the March book value.

The Regional Portfolio

Our regional portfolio has grown since 1 April with the addition of ten individual purchases of distribution warehouses in Alfreton, Portbury, Stevenage, Chester, Sunderland, Halesowen, Jarrow, Northampton and two in Stone for a combined £71m, including costs, yielding an average 7.7%. Set against these acquisitions are sales of nine assets (eight of which are distribution warehouses) for a combined £31m. The sold distribution warehouses were smaller multi-let assets which had been acquired as part of a portfolio and were sold at a 6.3% net initial yield. The regional portfolio, post The Bower acquisition, will comprise c. 45% of the investment portfolio and contributes c. £32m of gross contracted rents.

The retirement village programme comprises schemes at Durrants Village, Horsham, Millbrook Village, Exeter and Maudslay Park, Great Alne near Stratford-upon-Avon. During the half year we sold 17 residential units and opened the clubhouse at Durrants Village. The retail development programme, with partners Oswin Developments Limited, continues to progress schemes at Cortonwood and Truro having completed its scheme at Shirley, West Midlands.

Finance

During the half year we renewed our £100m revolving credit facility with RBS for a further five years, with the option of two additional one-year extensions, and have consolidated our retirement village facilities into one five-year facility of £65m with HSBC. The effect of these actions has been to maintain our average debt maturity at 4.3 years (31 March 2015: 4.3 years) whilst reducing our average cost of debt to 3.8% (31 March 2015: 4.1%).

We draw a distinction between secured borrowings, on which we have a net LTV (loan to value) of 31% (31 March 2015: 34%) and unsecured forms of debt i.e. our Retail and Convertible Bonds, which increase our overall LTV to 49% (31 March 2015: 52%). On completion of The Bower acquisition we expect the overall LTV to increase to 53%. As our development programme is built out and sold we expect the LTV to fall to c. 41% by 2021.

Outlook

Every deal Helical transacts is done so on its individual merits. Despite Helical's business model targeting London for capital growth and development profits and the regions for high yielding investment assets and trading profits, the Company has never simply bought into or sold out of a sector on broad weighting criteria.

In London we are seeking to provide high quality contemporary office space to appeal to a wide range of diverse tenants. We aim to develop an exciting working environment internally and to be positioned to benefit from attractive public realm either within our own site or adjacent to our buildings. These buildings appeal to today's tenants who are far more flexible to location than ever before and are engaged in a "war for talent", seeking to attract and retain staff. We have invested heavily against this criteria over recent years and our results confirm the success of this strategy. We believe the office market is well balanced going forward and the low level of availability and the number of pre-lettings support this view and gives us the confidence to undertake the speculative development of The Tower at The Bower.

Board Changes

I have been Chief Executive of Helical since 1984 and one of its major shareholders for most of that period. It is now time to hand over the reins to Gerald Kaye, my fellow director for the past 21 years and a talented and experienced professional with fantastic vision. Gerald has delivered numerous highly profitable schemes during his career at Helical which have been integral to the Company's delivery of strong shareholder returns. As a significant shareholder, I expect Helical to thrive under his stewardship. I will stand down as an Executive Director following next year's Annual General Meeting in July, at the same time as our current Chairman, Nigel McNair Scott, and Andy Gulliford, a non-executive director of Helical since 2006. I would like to thank Nigel for being my business partner and, more importantly, close confidant and friend over the last 30 years and also Andy, for his advice, wisdom and support during his ten years on the Board of Helical. I have been asked to take over from Nigel as non-executive Chairman and I am delighted to be able to continue to be part of the Helical story in a different role. In addition to these changes, Helical also plans to appoint up to two new non-executive directors to provide further independence and balance to the Board.

Michael Slade

Chief Executive

26 November 2015

Financial Review

Review of the Half Year

The results for the half year include growing rental surpluses, significant revaluation gains on the investment portfolio and profits from the development programme in London, and are reflected in pre-tax profits of £85.9m (2014: £42.9m) and EPRA earnings per share of 13.0p (2014: 5.3p). The Group's portfolio, including its share of property held in joint ventures, increased to £1,066m (31 March 2015: £1,021m) with valuation surpluses of £59.8m contributing to an increase in Shareholders' funds of 14% to £461.2m (31 March 2015: £404.4m) and a reduction in loan to value to 49% (31 March 2015: 52%). EPRA net asset value per share increased by 13.2% to 436p (31 March 2015: 385p).

During the period the Group continued to lengthen its borrowings profile and consolidated three retirement village facilities into one. These loan restructurings enabled the Group to maintain its overall debt maturity profile at 4.3 years (31 March 2015: 4.3 years), with a reduced weighted average cost of debt of 3.8% (31 March 2015: 4.1%).

At 30 September 2015, the Group had unutilised bank facilities of £74m and £150m of cash. The facilities are available to fund the Group's retirement village development programme, Phase One construction works at Barts Square, London EC1, and investment acquisitions.

EPRA Earnings

EPRA earnings during the period were £14.9m (2014: £6.5m), reflecting the Group's share of net rental income of £20.8m (2014: £18.8m) and development profits of £18.7m (2014: £15.6m) but, in accordance with EPRA, excluding gains on sale and revaluation of investment properties of £68.1m (2014: £34.8m). EPRA earnings per share were 13.0p (2014: 5.3p).

EPRA Net Asset Value

EPRA net asset value per share increased by 13.2% to 436p per share (31 March 2015: 385p). This rise was principally due to a total comprehensive income of £75.8m, less a reduction in the surplus on valuation of the trading and development stock to £25.1m (31 March 2015: £36.2m).

Income Statement

Rental income and property overheads

Gross rental income receivable by the Group in respect of wholly owned properties increased by 13% to £21.2m (2014: £18.8m). The Group's share of gross rents receivable in joint ventures reduced to £1.0m (2014: £3.1m) reflecting the sale of Clyde Shopping Centre in March 2015 and the termination of leases at Barts Square, London EC1, where the Phase One residential development is progressing. See-through gross rents totalled £22.2m (2014: £22.0m).

After taking account of head rents payable on those properties held on long leases, the costs of managing the assets, void costs and letting costs, see-through net rents increased by 11% to £20.8m (2014: £18.8m).

Development programme

The success of Phase One of The Bower, London EC1, during the period entitled Helical to earn development management fees of £15.0m from the joint venture with Crosstree. In addition, further net development management fees of £1.6m from the Scottish Power development in Glasgow and £0.4m from One Creechurch Place, London EC3, were earned in the period. Development profits of £0.3m at our retirement village programme, £0.3m in Poland and £0.1m at Clifton Street, London EC2, were offset by provisions against sites at Telford and in connection with our retail development programme of £1.5m. Total net development profits, excluding joint ventures, were £16.2m (2014: £14.4m).

Share of results of joint ventures

Our joint ventures include our share of investment properties at The Bower, London EC1, and our development schemes at Barts Square, London EC1; One Creechurch Place, London EC3; King Street, London W6; Leisure Plaza, Milton Keynes; and Shirley Town Centre, West Midlands. Detailed analysis of the financial position of our share of these joint ventures is provided in note 12 of this statement. In the half year net rents of £0.8m (2014: £2.4m) were offset by finance costs of £2.1m (2014: £1.6m) and administration costs of £0.4m (2014: £0.2m). Development profits of £2.5m (2014: £1.2m) arose mainly in respect of the retail schemes at Shirley Town Centre and at Leisure Plaza. A gain on revaluation of the investment portfolio of £18.5m (2014: £11.6m), primarily arose in respect of The Bower and we recognised £7.4m being our share of the profit made following the sale of One Bartholomew Close, London EC1. Net of taxes, our joint ventures contributed £31.8m (2014: £12.9m) in the half year.

Administration costs

Administration costs, before performance-related awards, increased by 8%, from £5.0m to £5.4m. This reflects an increase in the number of asset managers and development executives within the Group compared to the same period last year, as we expand our investment portfolio and move through the delivery phase of our development programme.

Performance-related share awards and bonus payments, before National Insurance costs, increased to £7.3m (2014: £6.0m) for the half year. In addition, National Insurance of £1.4m (2014: £1.7m) has been accrued in the period.

Finance costs, finance income and derivative financial instruments

Interest payable on bank loans, including interest on our share of loans on assets held in joint ventures of £2.1m (2014: £1.6m), but before capitalised interest, increased to £14.3m (2014: £11.2m), reflecting the increased debt taken on to finance the expansion of the Group's investment and development activities.

Capitalised interest increased from £1.9m to £2.4m as development schemes progressed. Other interest payable reduced from £4.2m to £1.5m. As a consequence of these movements, total finance costs reduced marginally from £13.5m to £13.4m. Finance income earned was £1.3m (2014: £1.1m).

Medium and long term interest rate projections at 30 September 2015 were similar to those at 31 March 2015 and therefore there was a negligible charge of £9,000 (2014: £1.5m) on the derivative financial instruments in the period which have been valued on a mark to market basis.

Investment portfolio

During the half year the Group acquired ten distribution warehouses for £71.2m, including costs, and one regional office and expended £23.6m on value enhancing capital expenditure on the London office portfolio (£7.1m in joint ventures), and at wholly owned Churchgate and Lee House in Manchester and the Morgan Quarter, Cardiff. The group sold eight warehouses and one regional office for a net £31.1m and the Barts Square joint venture sold the site at One Bartholomew Close for redevelopment for £102.4m. The sales of investment assets generated profits of £1.0m (2014: £1.4m) in the main portfolio and £7.4m (2014: £nil) in our joint ventures.

Revaluation surpluses of £41.5m (£0.2m attributable to our profit share partners) in our main portfolio and £18.5m in our joint venture assets increased the overall size of the investment portfolio on a see-through basis to £889.1m (31 March 2015: £789.8m).

Debt and financial risk

In total, Helical's outstanding debt at 30 September 2015 of £675.5m had an average maturity of 4.3 years (31 March 2015: 4.3 years) and a weighted cost of 3.8% (31 March 2015: 4.1%).

Debt profile at 30 September 2015 - excluding the effect of arrangement fees

*Net LTV is the ratio of gross borrowings less cash deposits to the fair value of the property portfolio.

Net borrowings and gearing

Net borrowings held by the Group have reduced slightly during the half year from £477.2m to £477.0m. Including the Group's share of net debt of its joint ventures the Group's share of total net debt has reduced from £531.9m to £518.0m. There has been a corresponding reduction from 113% to 99% in see-through net asset value gearing. This gearing measure, which is the ratio of see-through net borrowings to EPRA net asset value, represents a longer term view than the standard gearing measure.

Hedging

At 30 September 2015, the Group (including share of joint ventures) had £513m (31 March 2015: £497m) of fixed rate debt with an average effective interest rate of 4.3% (31 March 2015: 4.4%) and £159m (31 March 2015: £98m) of floating rate debt with an average effective interest rate of 2.6% (31 March 2015: 2.4%). In addition, the Group had £118m of interest rate caps at an average of 4.0% (31 March 2015: £143m at 4.0%).

Interest cover

In assessing the results of the Group for each financial year, Helical considers its interest cover as a measure of its performance and its ability to finance its annual interest payments from its net operating income, before revaluation gains or losses on the investment portfolio and net realisable provisions on the trading and development stock. In the half year to 30 September 2015, this interest cover was 4.1 times (2014: 3.0 times).

Tim MurphyFinance Director

26 November 2015

Helical's Property Portfolio - 30 September 2015

Helical's Portfolio by Fair Value

Investment Portfolio (Helical's share)

Portfolio yields

Note: this analysis excludes Barts Square, London EC1 and The Bower, Old Street, London EC1.

Valuation movements, portfolio weighting and changes to rental values

Note: includes sales, purchases and capex.

Capital values, vacancy rates and unexpired lease terms

Trading and development portfolio (Helical's share)

Note: the table above includes the Group's share of development properties held in joint ventures.

Investment Portfolio Overview

Our £889.1m investment portfolio provides income for the Group. We have a strong focus on asset management, maximising net operating income and working closely with our tenants.

Our income stream is diverse and secure with no tenant accounting for more than 5.8% of the rent roll. Our average weighted unexpired lease term is 7.0 years (31 March 2015: 7.0 years).

The income stream has grown steadily since 2010 and is highly reversionary. The gross contracted rent from our investment portfolio is £42.0m (31 March 2015: £36.7m) and the estimated rental value of our portfolio is £65.1m (31 March 2015: £59.5m). This reversionary income will be captured through letting vacant units and rent reviews.

Through judicious buying of under-rented buildings in growth areas, securing lettings and undertaking refurbishments, we aim to generate substantial capital growth in our property values.

Investment Property Portfolio Values

At 30 September 2015, the investment property portfolio was valued at £889.1m (31 March 2015: £789.8m), with £800.6m (31 March 2015: £701.5m) held in wholly owned subsidiaries and £88.5m (31 March 2015: £88.3m) held in joint ventures, as set out below.

Acquisitions and Sales

We have continued to find high quality assets at good value, particularly in the logistics sector. In the six months, we have acquired 10 single let logistics assets for a total price including costs of £71m at an average net initial yield of 7.7%. These properties are all of institutional quality but we often have the opportunity to add value through re-letting or lease renewal. During the period, we incurred capital expenditure of £16.5m in wholly-owned properties and £7.1m in joint ventures.

Over the six months a number of significant sales were completed, including our Polish assets in Gliwice and Wroclaw which concludes our investment in Poland. One Bartholomew Close, London EC1, was sold and forward funded for £102.4m and we will continue as development managers for the construction of the building. The joint venture will receive a profit share payment upon the successful letting of the building. We also sold a portfolio of eight smaller multi-let industrial assets for £28.4m, a 6.3% Net Initial Yield.

Capital Expenditure

We have a refurbishment and redevelopment programme upgrading and increasing space at a number of our investment properties.

Asset management

During the half year contracted income increased by £1.5m as a result of new lettings and rent reviews, net of any losses from breaks and expiries (2014: £1.0m).

We concluded £2.2m of new lettings and uplifts at renewal (4.9% rent roll) and benefitted from uplifts at rent review of £0.2m (0.4% rent roll), offsetting the loss of rent at lease end or break (£0.7m, 1.6% rent roll) and a further £0.2m through tenant administrations (0.4% rent roll).

Overall we have seen good letting demand across the portfolio, reducing our vacancy rate to 3.9% (31 March 2015: 5.1%). We have seen strong take-up and rental growth in our London office portfolio with estimated rental values increasing by 3.2% in the half year.

Lease expiries or tenant break options

The top 10 tenants account for 28% of the total rent roll and the tenants come from diverse industries.

The London Portfolio

The Bower, Old Street, EC1

This 3.12 acre asset was acquired in November 2012 for £60.8m in joint venture with Crosstree Real Estate Partners LLP (Helical interest 33.3%). The site is in the heart of an area which has become a "creative halo", a district of London which is a hub for technology, media and telecommunications companies and which is benefitting from substantial investment in infrastructure. A planning consent has been implemented to increase the floor space on the site by 116,000 sq ft, to refurbish existing areas and significantly upgrade the public realm with the creation of a new pedestrian street.

Since 30 September 2015, Helical has exchanged contracts to acquire The Warehouse and The Studio (211 Old Street) and The Tower (207 Old Street) from the joint venture.

211 Old Street, London EC1

Building work started on Phase One in January 2014 comprising The Warehouse, 128,366 sq ft and The Studio, 22,316 sq ft, and was completed in November 2015.

The current letting position on Phase One is as follows:-

207 Old Street, London EC1

Comprising The Tower, Phase Two of the redevelopment of The Bower will commence in December 2015. Planning has been obtained for a comprehensive refurbishment of the existing building of 119,000 sq ft, increasing the building to c. 170,000 sq ft of office space and 7,300 sq ft of retail/restaurant.

183-213 Old Street, London EC1

This retail parade comprises 55,724 sq ft fully let to tenants including a Gymbox, Co-op Food Store, Argos, Peacock and the Post Office generating c. £915,000 rents. This parade is to be acquired by Crosstree for £23m, a 24% premium to the 30 September 2015 valuation.

Empire House, London EC1

The Bower also includes Empire House, fully let to Z Hotels and restaurant Ceviche. Since the half year end the building has been sold to Standard Life Investments Long Lease Fund for £20.65m, a premium of c. 6% to the 30 September 2015 value.

Barts Square, EC1

In joint venture with The Baupost Group LLC (Baupost 66.7%, Helical 33.3%), we own the freehold interest in land and buildings at Bartholomew Close, Little Britain and Montague Street, a 3.2 acre site adjacent to the new Barts Hospital and just south of Smithfield Market. Existing buildings are let to the NHS on a number of short term leases that expire in 2016.

Planning consent has been implemented for a comprehensive redevelopment of 19 buildings to provide a total of 236 residential apartments, three office buildings of 211,000 sq ft, 23,485 sq ft and 10,200 sq ft, 16,300 sq ft of retail /A3 at ground floor as well as major public realm improvements, which will be incorporated into the wider Smithfield Area Strategy being worked up by the City of London.

Phase One - Residential/offices/retail

Phase One of the redevelopment of Barts Square comprises 144 residential units, 10,200 sq ft of retail space, 23,485 sq ft of new offices behind retained facades and public realm improvements. The demolition of buildings in Bartholomew Close and Little Britain commenced in January 2015, with the retention of various facades behind which the buildings are being demolished. Completion of Phase One is expected in summer 2017. 93 residential units have been sold for a total sales value of c. £125m at an average £1,579 psf.

Phase Two - One Bartholomew Close, London EC1 - Offices

One Bartholomew Close was sold to clients of Ashby Capital LLP ("Ashby") for £102.4m in August 2015, releasing £34m of cash to Helical. Demolition of the existing building and the construction of a new 12 storey office block of c. 211,000 sq ft, to be called One Bartholomew Close, has just commenced. The building is due to be completed in July 2018. Ashby's clients will finance the development costs and when the building is completed the joint venture will be entitled to receive a profit share payment upon the successful letting of the building. Helical Bar will remain as development manager for delivery of the project.

Phase Three - Residential/retail

Phase Three of the redevelopment of the site, involving the demolition of Queen Elizabeth II House, 62 Bartholomew Close, 42-44 Little Britain and 45-47 Little Britain, is expected to commence after vacant possession of these buildings is obtained in November 2016. In their place, 92 residential units and 10,700 sq ft of retail space will be constructed.

One Creechurch Place, City of London EC3

One Creechurch Place, London EC3, is a landmark City office scheme in the heart of the insurance sector in London. In May 2014, Helical signed a joint venture agreement with HOOPP (Healthcare of Ontario Pension Plan) to redevelop the site. Under the terms of the joint venture, HOOPP and Helical will jointly fund the project on a 90:10 split, with Helical acting as development manager for which it will receive a promote payment depending on the successful outcome of the scheme. It is anticipated the completed development will have a capital value of c. £250m. The new building, comprising 271,000 sq ft NIA of offices and 2,227 sq ft of retail, is expected to be completed in September 2016.

C-Space, 37-45 City Road, EC1

Helical acquired C-Space in June 2013. Planning consent was obtained for a complete refurbishment of the building which increased the previous existing 50,000 sq ft office building to 62,000 sq ft. The works involved an additional floor and extensions to the third floor, a landscaped courtyard and entrance "pavilion" to the rear and full height glazing to the raised ground floor. Works completed in October 2015. 75% of the space has been let to DLKW Lowe, the creative agency, and only the top floor and half of the third floor remain available.

23-28 Charterhouse Square, Smithfield EC1

In December 2014, Helical exchanged contracts to acquire a new 155 year leasehold interest in 23-28 Charterhouse Square, London EC1, from the Governors of Sutton's Hospital in Charterhouse for £16m. Helical plans to carry out a major refurbishment of the existing building, increasing the current 34,000 sq ft to 37,962 sq ft of offices and 5,170 sq ft of retail/restaurant use with the addition of a new sixth floor. Works are due to commence in early 2016 and the completed building is expected to be delivered in early 2017.

King Street, Hammersmith W6

King Street, Hammersmith W6, is a mixed-use scheme, in joint venture with Grainger plc, for the regeneration of the west end of King Street. Planning permission for the scheme was granted in April 2014 for 196 apartments, a three-screen cinema to be operated by Curzon, new retail, restaurant and café space, and replacement offices for the Council with a new public square. A new planning application is being submitted imminently to make some minor amendments and work is expected to commence in mid-2016.

Shepherds Building, Shepherds Bush, W14

This 151,000 sq ft multi-let office building close to the Westfield London shopping centre maintains an occupancy approaching 100%, as it has for eight consecutive years. Significant rental growth is beginning to be seen with ERV now c. £50 psf compared to an average passing rent of £30.50 psf. We have agreed a number of new leases at rents in excess of £50 psf, beginning to capture the material reversionary potential of the building.

New Loom House, Whitechapel E1

This 112,000 sq ft listed building was acquired in 2013 and Helical has secured planning consent for a comprehensive refurbishment/reconfiguration of the common parts to include a new entrance/reception, showers, bike store, refurbishment of c.15,000 sq ft of offices, including the creation of a single 11,000 sq ft unit and 4,000 sq ft of café and restaurants. The works are underway and are due for completion in early 2016. Strong rental growth is already being achieved with new lettings being agreed at £37.50 psf compared to an average passing rent of £22.00 psf. Further increases in rents are anticipated as the opening of Crossrail approaches.

One King Street, Hammersmith, London W6

One King Street, Hammersmith, W6, is a 35,000 sq ft building acquired in 2012 comprising 22,000 sq ft of offices and 13,000 sq ft of retail. Refurbishment of the fourth floor and the addition of a fifth floor of offices on top of the building has completed, providing 3,500 sq ft of extra space. The fourth and fifth floors have been let to Orion Healthcare at a headline rent of £52.50 psf and £55.00 psf, a record rent for Hammersmith.

Chart House, Islington N1

Chart House is a 10,500 sq ft office building in Islington. There is currently planning consent for an additional floor of residential on top of the building. It is our intention to renegotiate the planning consent and add an extra floor of office accommodation in place of the planned residential space upon getting vacant possession in 2018.

Sales

Clifton Street, Shoreditch EC2

In November 2013, we committed to forward purchase a new 45,000 sq ft (NIA) office building in Clifton Street, Shoreditch EC2, for £21m. Since contracting to acquire the building, Helical has worked with the developer to achieve a revised planning consent and to refine the building's specifications to ensure it meets the demands of the Shoreditch tech occupiers. It was intended that the Group would complete the freehold purchase upon practical completion of the construction in summer 2015. Since then, on 30 September 2014, Helical exchanged contracts on the forward sale of 99 Clifton Street for £38.25m, allowing the Group to recognise development profits of £16.4m in the prior year. This sale completed in September 2015, monetising a total profit of £17.25m.

Enterprise House, Paddington W2

Enterprise House, Paddington W2, is a freehold building adjacent to Paddington Station in London comprising 45,000 sq ft of offices. The building was acquired on a sale and lease-back agreement from Network Rail, which holds a 20 year lease without breaks, for c. £31m representing a 5.7% yield generating annual rental income of £1.8m. In October 2015, the asset was sold to a private overseas buyer for £43m, a premium of 10% to the 30 September 2015 valuation, crystallising an IRR in excess of 100%.

Artillery Lane, Bishopsgate E1

Artillery Lane, Bishopsgate, E1, is an office building in the City of London. Acquired for £6.8m in 2013 the property has been sold to Standard Life post the period end for £15.1m following the completion of works which provide 17,000 sq ft of newly refurbished offices.

The Regional Portfolio

Our regional portfolio provides significant income for the Group. We have a broad spread of income providing diversity between tenants and sectors of the market. Our £472.4m regional investment portfolio comprises £103.8m (31 March 2015: £103.5m) of offices (11.7% of the investment portfolio), £193.8m of industrial/logistics (21.8%) £162.9m of retail comprising £102.8m of retail warehousing and £60.1m of in town retail, largely Cardiff (in aggregate 18.3%) and £11.9m of retirement village investment assets (1.3%).

Our strategy is to acquire multi-tenanted properties where there is significant opportunity to increase net operating income and capital values. We acquire properties with rents which are low compared to equivalent buildings, providing scope for rental growth. We spend a considerable amount of time talking to our tenants both prior to acquiring properties and during the course of our ownership to ensure that the space they occupy continues to be fit for their purpose.

Distribution Warehouses

Helical has 33 distribution and light industrial units located around major UK transport networks. These units generally have very few bespoke features making them straightforward to re-let if vacancies occur. The majority of the assets are single let with a few multi-let estates. Significant assets within the portfolio include a 250,000 sq ft distribution warehouse let to Sainsbury's in Yate, Bristol, a 200,000 sq ft facility in Leighton Buzzard, Bedfordshire, a 210,000 sq ft distribution warehouse in Northampton and a 183,000 sq ft distribution warehouse let to the Royal Mail in Chester.

Regional Offices

Churchgate and Lee House, Manchester

Helical acquired Churchgate and Lee House, two interlinked office buildings comprising 248,000 sq ft of offices, in March 2014. We have refurbished the reception, café and a number of office floors and continue to reposition the asset. We have concluded 16,000 sq ft of new lettings in the period.

Dale House, Manchester

Dale House is a 43,000 sq ft office building situated in the Northern Quarter of Manchester. It is fully let to a number of tenants with an average rent of £12.00 psf and was acquired in March 2015 for £7.4m. The property is a long term hold with plans to refurbish the building over time and move rents upwards as the location improves.

St Vincent Street, Glasgow

In partnership with local development partner, Dawn Developments Ltd, Helical is the development manager for the construction of the new headquarters building for Scottish Power at St Vincent Street, Glasgow. The completed building will comprise c. 220,000 sq ft of prime office space in the heart of the City's commercial district. Funded by M&G Investments, the scheme is under construction and all works, including Scottish Power's fit out, are due to be completed by mid 2016. As part of the overall deal, Helical took on three existing Scottish Power sites which are surplus to requirements. We have received planning permission for a change of use of the grounds of Cathcart House to 158 residential units and will look to sell the site. At Yoker, we have agreed heads of terms with a supermarket operator to sell the site, and we have already forward sold the site at Falkirk.

Retail Warehousing

Our retail warehousing comprises £102.8m of our portfolio (31 March 2015: £101.6m) with assets in Birkenhead, Cardiff, Ellesmere Port, Great Yarmouth, Harrogate, Huddersfield, Leigh, Scarborough, Sevenoaks, Southend, Stockport and Stoke.

Retail Developments

Parkgate, Shirley, West Midlands

The Shopping Centre at Parkgate, Shirley, where Helical has a 50% interest, has completed on site and the 80,000 sq ft Asda together with a number of other retailers have opened successfully for trade. The space beyond the food-store is let to occupiers such as B&M, Peacocks, Poundland, Pizza Express, JD Wetherspoon, Prezzo, Shoe Zone and Shirley Library. The food-store has been pre-sold to Asda and the retail units will be marketed for sale once the final units are let.

A second phase of high density residential is being progressed on a 10 acre site opposite the Parkgate scheme. Terms have been agreed with a care home provider, a residential developer and a supermarket operator for a petrol filling station. A planning application will be submitted in December 2015.

Truro

Helical has entered into a Conditional Purchase Agreement on the six acre Truro City Football Club site which has planning consent, subject to a s106 Agreement, for a 78,000 sq ft non-food retail park. The scheme proposals provide for the relocation of the football club and we anticipate starting on site in summer 2016.

Cortonwood

Planning Consent has been secured and marketing is in hand for an 80,000 sq ft Open A1 non-food retail park. Terms are agreed with a number of leading fashion retailers and a start on site is anticipated in spring 2016, once funding has been obtained.

Poland

During the half year to 30 September 2015, we completed the sale of our 50% share in the 720,000 sq ft retail development at Europa Centralna, Gliwice, Poland, to our joint venture partners, clients of Standard Life, in accordance with a pre-arranged contractual exit two years post completion of the scheme. The sale, at book value, reduced gross property assets by £41m and reduced net debt by £26m. In July 2015, we also completed the sale of our 103,000 sq ft retail development at Wroclaw, Poland at €17m, a small premium to book value. The sale of these two assets completed the exit of our joint venture in Poland.

Retirement Villages

A retirement village is a private residential community in which active over-55s are able to live independently in retirement. Residents have typically down-sized from a larger family home into a cottage or apartment which ensures no maintenance or security issues.

With access to a central clubhouse containing a bar and restaurant facilities, health and fitness rooms and surrounded by maintained grounds, this retirement option is proving increasingly popular. We have four retirement village developments.

Bramshott Place, Liphook, Hampshire

The original Bramshott Place Village was an Elizabethan mansion built in 1580, although now only the original Grade II listed Tudor Gatehouse remains which Helical has fully restored. The land and buildings were derelict when we acquired the site in 2001. Changing planning from its previously designated employment use to a retirement village took several years but was eventually achieved in 2006.

The development of 151 cottages and apartments, and the new clubhouse, has completed and we have sold 150 of the units with the final one reserved. We have received planning for a further 40 cottages on the site which we anticipate implementing next year.

Durrants Village, Faygate, Horsham, West Sussex

Durrants Village, a 30 acre site, had operated as a saw-mill with outside storage for many years. Helical was granted planning permission, at appeal, in May 2009 where the Inspector allowed a development comprising a retirement village of 148 units, eight affordable housing units, a 50 bed residential care home and a central facilities clubhouse building. Following changes to the scheme the development will now comprise 173 units. The first phase started in May 2012 for the construction of the retirement village and clubhouse and we have sold 35 units, exchanged on four further sales and have reservations on six additional units in the first two phases.

Maudslay Park, Great Alne, Warwickshire

This is a Green Belt site which has 320,000 sq ft of built footprint and benefits from Major Development Site planning policy. Covering 82 acres, this site received outline planning permission in April 2011 for a retirement village of 164 units. Demolition and enabling works have completed and construction of the first units has now commenced. We have reservations on six units.

Millbrook Village, Exeter

This 19 acre site was acquired in 2007 from the St Loye's Foundation, a long established rehabilitation college in the City of Exeter. Resolution to grant planning permission was obtained in October 2009 for a retirement village of 206 units, a 50 bed residential care home, an affordable extra-care block of 50 units and a central facilities clubhouse building. Demolition, site clearance and archaeological survey work have been completed. In 2011 we received planning consent for 63 open market housing units on part of the site and sold this in summer 2012. Construction of a 164 unit retirement village and clubhouse in phases on the remainder of the site commenced in October 2013. We have sold 13 units, have exchanged contracts on one additional unit and have reservations on 18 other units.

London26 November 2015

Unaudited Consolidated Income Statement

For the Half Year to 30 September 2015

Unaudited Consolidated Statement of Comprehensive Income

For the Half Year to 30 September 2015

The exchange differences on retranslation of net investments in foreign operations will be reclassified to the Income Statement in the future.

Unaudited Consolidated Balance Sheet

At 30 September 2015

Unaudited Consolidated Cash Flow Statement

Unaudited Consolidated Statement of Changes in Equity

At 30 September 2015

For a breakdown of total comprehensive income see the Unaudited Consolidated Statement of Comprehensive Income.

The adjustment against retained earnings of £2,840,000 (31 March 2015: £6,432,000) adds back the share based payments charge in accordance with IFRS 2 Share Based Payments.

There were net transactions with owners of £18,858,000 (31 March 2015: £10,840,000) made up of the performance share plan charge of £2,840,000 (31 March 2015: £6,432,000) and related deferred tax debit of £1,714,000 (31 March 2015: credit of £2,477,000), dividends paid of £5,899,000 (31 March 2015: £7,944,000), the purchase of own shares of £14,752,000 (31 March 2015: £13,349,000), the issue of new shares of nil (31 March 2015: 120,000) and the share settled bonus of £667,000 (31 March 2015: £1,424,000).

The adjustment against retained earnings of £3,150,000 adds back the share based payments charge in accordance with IFRS 2 Share Based Payments.

There were net transactions with shareholders of £8,530,000 made up of the performance share plan charge of £3,150,000, dividends paid of £5,538,000, the purchase of own shares of £6,995,000, the issue of new shares of £120,000 and the share settled bonus of £733,000.

Unaudited Notes to the Half Year Results

1. Financial Information

The financial information contained in this statement does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. The full accounts for the year ended 31 March 2015, which were prepared under International Financial Reporting Standards as adopted by the European Union and which received an unqualified report from the Auditors, and did not contain a statement under Section 498 of the Companies Act 2006, have been filed with the Registrar of Companies.

These interim condensed unaudited consolidated financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union. The principal accounting policies have remained unchanged from the prior financial period to 31 March 2015.

These interim condensed unaudited consolidated financial statements do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 March 2015.

The Directors have a reasonable expectation that the Group will continue in operational existence for the foreseeable future and have, therefore, used the going concern basis in preparing the financial statements.

Principal Risks and Uncertainties

The responsibility for the governance of the Group's risk profile lies with the Board of Directors of Helical. The Board is responsible for setting the Group's risk strategy by assessing risks, determining its willingness to accept those risks and ensuring that the risks are monitored and that the Group is aware of and, if appropriate, reacts to, changes in those risks. The Board is also responsible for allocating responsibility for risk within the Group's management structure.

The Group considers its principal risks to be:

• market risk

• strategic risk

• financial risk

• development risk, and

• people risk.

There have been no significant changes to these risk areas in the period nor are there expected to be for the half year to 31 March 2015. A further analysis of these risks is included within the consolidated financial statements of the Group for the year ended 31 March 2015.

Use of Estimates and Judgements

With the exception of the two additional points below, the estimates and judgements have remained unchanged from the prior financial period to 31 March 2015:

• Determination of the most appropriate percentage interest in our Joint Ventures to equity account for, where our economic

interest can differ to our ownership interest (see note 12)

• Recognition of development management service income, where payment for these services is triggered by a future event (sale

of the property) and where estimation is required to determine the stage of completion.

The half year statement was approved by the Board on 26 November 2015 and is available from the Company's registered office at 5 Hanover Square, London W1S 1HQ and on the Company's website at www.helical.co.uk.

2. Statement of Directors' Responsibilities

Each of the Directors confirms that, to the best of his knowledge, the condensed set of unaudited financial statements, which has been prepared in accordance with IAS 34 as adopted by the European Union, gives a true and fair view of the assets, liabilities, financial position and profit or loss of the issuer, or the undertakings included in the consolidation as a whole and that the interim management report herein includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R.

Balances with related parties at 30 September 2015, 30 September 2014 and 31 March 2015 are disclosed in note 24.

A list of current Directors is maintained at 5 Hanover Square, London W1S 1HQ and at www.helical.co.uk.

On behalf of the Board

Tim MurphyFinance Director

26 November 2015

3. Segmental Information

The Group identifies two discrete operating segments whose results are regularly reviewed by the Chief Operating Decision Maker (the Chief Executive) to allocate resources to these segments and to assess their performance. The segments are:

• investment properties, which are owned or leased by the Group for long-term income and for capital appreciation, and trading properties, which are owned or leased with the intention to sell; and,

• development properties, which include sites, developments in the course of construction, completed developments available for sale, and pre-sold developments.