Helical Bar Regulatory News (HLCL)

Helical Bar plc ("Helical" or the "Company")

Interim Management Statement for the period since 1 April 2012

DEVELOPMENT PROGRAMME CONTINUES TO GAIN MOMENTUM

Helical today issues its Interim Management Statement covering its activities for the period from 1 April 2012 to 23 July 2012.

Highlights

·; Development programme continues to generate positive momentum with the Company appointed as preferred developer for the 220,000 sq ft ScottishPower headquarters and an outline planning application submitted for Brickfields, White City, London W12.

·; Further solid progress achieved in programme of disposals of low or non-income producing assets, with £10m of sales and circa £25m exchanged or under offer at or above book value.

·; Additional profit share of £7.25m crystallised at Fulham Wharf, SW6, following the sale of the site.

·; £31.5m of debt refinanced since 31 March 2012 with a small reduction in the Company's overall average cost of debt taking it to 4.0% (31 March 2012: 4.1%).

Commenting on the Company's activities, Michael Slade, Chief Executive, said:

"Since the year end we have made significant progress with our development programme including the submission of an outline planning application at Brickfields, White City, London W12 and the crystallising of a further profit share following the landowner's successful sale of the site at Fulham Wharf, London SW6. We are also excited by a number of development opportunities that are enhancing our already considerable pipeline, including our recent selection as preferred developer for a landmark new headquarters for ScottishPower."

Development Programme

·; In Glasgow, ScottishPower has appointed Helical as preferred developer, alongside our joint venture partners, Dawn Developments, for its new 220,000 sq ft, 14 storey headquarters. Work is expected to commence in 2013, with an estimated completion in late 2015.

·; At Brickfields, White City, London W12 we have submitted an outline planning application for a residential led mixed use scheme including 1,150 new houses, 170,000 sq ft of commercial and 20,000 sq ft of retail.

·; Fulham Wharf, London SW6 has now been sold with planning permission for a new 100,000 sq ft supermarket and 463 residential units, crystallising an additional profit share of £7.25m for the Company, in addition to the £1.5m management fee already received, payable in line with the phased payments made to the landowner.

·; At Barts Square, London EC1, the detailed planning application submitted in February 2012 is progressing well and we are confident that planning consent will be obtained for a 450,000 sq ft mixed use scheme by the end of 2012.

·; At 200 Aldersgate Street, London EC1, a 370,000 sq ft refurbishment, we have let 112,000 sq ft of space and continue to receive an encouraging level of interest from potential tenants for the remaining space.

·; At Mitre Square, London EC3, demolition of the existing buildings is expected to start shortly and will be completed by early 2013 enabling construction of the new building to commence.  

·; At Parkgate, Shirley, West Midlands we have completed, with our 50:50 partners, Coltham Developments, the forward sale of an 85,000 sq ft supermarket to Asda and are preparing to commence work on this, as well as 72,000 sq ft of retail and circa 120 residential apartments and townhouses.

·; At Europa Centralna, Gliwice, Poland, construction is proceeding on the 720,000 sq ft project and is on target for completion in November 2012. The scheme is over 70% let with encouraging levels of interest in the remaining space.

Sales

·; We have completed, at book value, the sales of three industrial assets in Manchester for circa £7.2m.

·; Since 1 April 2012 we have completed the sales of six units at our retirement village at Bramshott Place, Liphook, for £2.4m with a further eight units, with a sales value of circa £3.2m, exchanged and due to complete by the end of September. We have now completed or exchanged contracts on 98 units, with a further 14 reserved, out of a total of 151 units.

·; We have circa £25m of sales of non-income producing assets exchanged or under offer at or above book value. We have exchanged contracts to sell two sites with planning consent for open market housing, both at book value. The sale of Milton (Cambridge) is now unconditional and will complete in early September. Completion of the sale of part of our retirement village in Exeter (£7.6m) is subject to various conditions which we expect to clear in the near future.

Asset Management

·; At Battersea Studios, London, SW8, we have let circa 12,600 sq ft to G.M.W. Architects and Ski Solutions at circa £25psf adding over £300,000 pa of rents and reducing void costs by circa £200,000. These lettings reduce the vacancy rate at the two buildings from 39% to 27% with good interest being shown in the remaining space.

·; At Broadway House, Hammersmith, London, W6 we have completed the refurbishment of the vacant office space and are marketing it to potential tenants. We have completed one retail rent review, increasing contracted rent by £14,350 and agreed a lease renewal which is in solicitors' hands.

·; At Morgan's Quarter, Cardiff, we have let 2,700 sq ft to Jack Wills at £172 Zone A demonstrating continued rental growth at the property.

·; From 1 April 2012 to 30 June 2012, we have completed 12 new lettings and 12 lease renewals. The renewals have secured £610,000 of income. The new lettings and positive rent reviews have been offset by the loss of 16 tenants at lease end / break or through receiverships. Overall this has meant a £120,000 reduction in our annualised rental income. The Battersea and Cardiff lettings mentioned above occurred after 30 June 2012 and as such this income (£480,000) will be captured in the next reporting period.

Financing

·; We have renewed for a further three years, two loans totalling £31.5m which were due to expire in 2012. In addition, we are in discussions with banks regarding the extension of circa £80m of bank facilities due to expire in the next 14 months. We are confident that we will be able to renew these loans on acceptable terms.

·; As at 30 June 2012, the Group's share of net debt (including joint ventures) was £263.1m (31 March 2012: £264.2m). The ratio of net debt to the property portfolio, based on 31 March 2012 asset values, was 47% (31 March 2012: 46%). The Group's weighted average cost of debt is 4.0% (31 March 2012: 4.1%), with an average length of 2.9 years (31 March 2012: 2.8 years).

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