Helical Bar Regulatory News (HLCL)

24 July 2013

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

Interim Management Statement for the period since 1 April 2013

Helical Bar plc today announces its Interim Management Statement covering its activities for the period 1 April 2013 to 23 July 2013 ("the Period").

Highlights

·; Sale of Brickfields, White City, London W12 by our joint venture partner Aviva crystallising the Company's profit share.

·; Letting of the remaining space at 200 Aldersgate Street, London EC1 completed: the impending sale of the asset will enable Helical to monetise its development management profit share.

·; Forward funding of retail and leisure development at Leisure Plaza, Milton Keynes with Aviva Investors' Lime Property Fund.

·; Demolition of buildings at Mitre Square, London EC3.

·; Submission of revised planning application for Hammersmith Town Hall, London W6.

·; £18m of investment purchases with a further £58m in solicitors' hands.

·; Successful closing of a seven year £80m unsecured Retail Bond with a 6.00% coupon, diversifying sources of funding and extending the Company's weighted average debt maturity to three years 11 months (31 March 2013: two years 11 months).

·; £75m revolving credit facility agreed with Barclays, consolidating three existing facilities.

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

"This has been an exciting start to the financial year for Helical. The success of our recent retail bond issue, where demand exceeded our expectations, together with the forthcoming monetisation of our interests in the development schemes at Brickfields, White City and 200 Aldersgate, provides us with the financial resources to increase our exposure to the central London office market whilst maintaining our holding of high yielding, cash generative shopping centres and contribute equity to our central London development programme. Quite definitely, our market has moved forward strongly in the last three months in terms of tenant demand, rental levels and capital growth."

Investment Portfolio

Purchases

·; In June we purchased Maple House, 37-45 City Road, London EC1, a 55,000 sq ft office building just south of the 'Silicon Roundabout' for £17.6m, adding to our holdings in this strategically important part of London. The building will be refurbished and re-positioned ready for re-letting in 2014.

Sales

·; We have sold, at book value, the 67,500 sq ft Asda at Clyde Shopping Centre, Clydebank and the 15,000 sq ft Iceland in Corby for a combined total of £13.1m, the proceeds of which were used to repay £9.0m of bank debt.

·; During the Period, we completed the sale of seven units at our retirement village at Bramshott Place, Liphook, for £2.3m bringing the total completed sales to 117 units out of 151 units with a further 14 reserved.

·; At our retirement village at Durrants Village, Horsham we have exchanged on two sales and have reservations on 14 units for a total value of £7.5m, out of the first phase of 43 units under construction.

Asset Management

·; Completion of £830,000 of new lettings since 1 April 2013.

·; At One King Street, Hammersmith, we have completed a letting of circa 6,000 sq ft to Drugdev at an annual rent of circa £185,000 (£32.50 psf) following our refurbishment of the building. We have good interest in the one remaining floor.

·; Conclusion of in excess of £250,000 of new lettings in Corby and circa £70,000 in Newmarket (which is now fully let), together with a positive rent review on Marks & Spencer in Newmarket (adding £19,500 in annual rent, a 17% uplift).

·; In the portfolio, ten leases have been renewed securing £175,000 of rent, marginally above previous rental levels.

·; Our total contracted income (accounting for losses from breaks and expiries but excluding space taken back for refurbishment at 207-211 Old Street, London EC1) has increased by circa £512,000 pa. Including Old Street, where we anticipate commencing a refurbishment soon and are therefore actively seeking vacant possession of 211 Old Street, our contracted income has increased by a net £419,000.

·; Limited exposure to administrations during the Period, with only two Internacionale units (total rent £127,000) both of which are still trading.

Development Programme

·; In May our joint venture partner, Aviva, sold the entire interest in 11 acres of land and buildings at Brickfields, White City, London W12 with completion due in early September.

·; At 200 Aldersgate Street, London EC1, where Helical has a development and asset management agreement with Deutsche Pfandbriefbank AG, the building is now 99% let and is being marketed for sale. Interest in the building is very strong from a number of UK and overseas investors and completion of a sale is expected later this year.

·; Disposals at Brickfields and 200 Aldersgate will monetise our interest in the two schemes and upon completion should realise for the Company no less than £40m of profit of which £27m was included in our 31 March 2013 EPRA net asset value per share.

·; At Leisure Plaza, Milton Keynes we have forward funded, with Aviva Investors' Lime Property Fund, our retail and leisure scheme being developed in a 50:50 joint venture with local developer Abbeygate Developments. The scheme comprises an 80,000 sq ft food store let to Morrisons on a long lease, due to be completed by August 2014. The joint venture also owns an ice rink and a site with consent for 33,000 sq ft of open A1 retail.

·; At Mitre Square, London EC3, demolition of the existing buildings has started and will be completed by December 2013 enabling construction of the new building to commence, once the scheme is forward funded or substantially pre-let.

·; In Hammersmith, we have submitted a revised planning application, in a 50:50 joint venture with Grainger, for the redevelopment of the west end of King Street, London W6 to comprise offices of 40,000 sq ft, 196 apartments, new three screen 250 seat community cinema and a new public piazza surrounded by restaurants and retail.

Financing

Since the beginning of the Period, we have:

·; Raised £80m through the issue of an unsecured seven year 6% sterling denominated retail bond. The offer closed six days early after demand exceeded expectations. Upon receipt of the net funds, Helical repaid £41.2m of the revolving credit facility with RBS, retaining the balance to fund new acquisitions.

·; Signed a new £75m revolving credit facility with Barclays Bank PLC, refinancing £49.3m of existing debt, leaving £25.7m to fund future acquisitions.

·; Signed a £25m facility with HSBC to finance our retirement village development at Great Alne, Warwickshire.

·; Refinanced our retail investment at Sevenoaks, due to be repaid in May 2013, by transferring £7.5m of debt into the RBS revolving credit facility.

At 30 June 2013, the Company's bank facilities comprised:

·; £238.3m of investment facilities of which £162.6m was drawn down, leaving £75.7m to fund future acquisitions. These borrowings have an average maturity date of four years and a weighted average cost of debt of 4.6%.

·; £93.6m of site acquisition and development facilities of which £64.6m was drawn down, leaving £29.0m to fund the retirement village development programme and future site acquisitions. These borrowings have an average debt maturity date of two years and a weighted average cost of debt of 3.9%.

·; A share of bank facilities in joint ventures of £77.5m, of which £68.6m was drawn down, leaving £8.9m available to be utilised. These facilities have an average maturity date of two years and a weighted average cost of debt of 4.5%.

Including the £80m retail bond, Helical's share of net debt as at 30 June 2013, including debt and cash held in joint ventures, was £320.8m, with an average maturity date of three years 11 months (31 March 2013: two years 11 months) and a weighted average cost of debt of 4.9%. Of the borrowings, £249.0m (66%) is fixed at an average rate of 5.0% with the remaining £127.5m (34%) floating at an average rate of 3.8%. The Company has interest rate caps on £121m of floating rate debt protecting it against base rate rises up to 4.0%.

For further information, please contact: