Trinity Capital Regulatory News (TRC)

3 Nov 2006 07:01

Trinity Capital PLC03 November 2006 FOR IMMEDIATE RELEASE TRINITY CAPITAL PLC ("Trinity" or the "Company") Interim results for the period ended 30th September 2006 Trinity is the Indian property fund established to invest in real estate and real estate related entities across India. The Company was admitted to AIM market in April 2006, raising gross proceeds of £250 million. Highlights • As at 3 November 2006, the Company has invested £55.45 million in Indian real estate developments, representing 23% of the net capital to be invested. In addition, approximately £70.2 million is committed to further joint venture investments with IL&FS over the next 6-8 months. Taken together the fund is now over 50% committed. • Principal investment commitments during the period include: o Approximately £75 million ($140 million) committed to joint ventures with IL&FS and IL&FS Investment Managers: • £48 million committed to a joint venture with IL&FS, that will focus on the development of infrastructure projects such as ports, airports and roads • £27 million committed to a joint venture with IL&FS Investment Managers to develop real estate opportunities • Investments announced since the half year-end o £28.3 million investment in a £215 million IT Park, Greater Noida o £11.6 million investment in £56 million residential project, Mumbai o £10.75 million investment in £265 million township development in Thane, Mumbai o £4.8 million shareholding in ITNL, a subsidiary of IL&FS (first draw down of £75 million partnership with IL&FS) • Deal pipeline in excess of £350 million with a number of projects in advanced stages of due diligence • NAV per share of 95 pence • Interest income of £5.2 million • Profit before tax of £2.6 million • EPS for the period of 1.04 pence Michael Cassidy, Chairman of Trinity Capital PLC, said: "We have made excellentprogress in establishing our position as a premier real estate investor in India.The knowledge and experience of our team on the ground has resulted in Trinitymaking a number of strategically significant investments across a broad range ofreal estate assets and sectors. To date, we have committed £125.65 million representing over 50% of our capitalto be invested, and our current pipeline of investments is in excess of £350million, with a number of projects being at advanced stages of due diligence. Weare therefore confident that we will meet our stated investment target withinthe timetable set out at admission. As one of the first institutional funds to focus on Indian real estate, theCompany has a natural advantage over some of the newer entrants into themarketplace. Over the last 2-3 years, the asset manager has established a verystrong team, developed good relationships amongst both the leading Indian realestate developers and has invested significant time in building a strongpipeline of high quality transactions. The benefits of this intense activity arenow being realised evidenced by the acquisition announcements made duringOctober 2006." ENDS Enquiries: Trikona Capital Rak Chugh +91 11 2620 7257 Cardew Group Tim Robertson +44 20 7930 0777 Sofia Rehman Catherine Maitland (London) Gutenberg PR Harjiv Singh (New York) +1 212 209 3863 Pranav Kumar (Delhi) +91-98100-77898 Numis Iain McDonald +44 20 7776 1567 Notes: • For further information and regular updates regarding the Fund's activities, please log on and sign up for news alerts at www.trinityplc.com Chairman's Statement I am pleased to announce Trinity's first set of interim results since it wasadmitted to the AIM market on 21 April 2006, having raised a total of £250million on IPO (£238 million net of expenses). The Company is making goodprogress in establishing itself as a premier real estate investor in India.Since the half-year end, we have announced 4 transactions investing a total of£55.45 million. The fund is currently 23% invested and has committedapproximately a further £70.2 million to projects with its joint developmentpartner lL&FS anticipated to be invested over the next 6-8 months. Takentogether Trinity has committed in excess of 50% of its capital. This is anexcellent start and underpins our confidence that the fund will meet itsinvestment targets set at the time of the IPO, both in terms of performance andin terms of investment timetable. Financial Results During the period under review the Company retained the funds raised (net ofexpenses) on deposit, earning, on average, 4.7%. Towards the end of the period,the Company entered into a cash management arrangement with Merrill Lynchdesigned to enhance the rate earned and spread investment risk by investing in arange of high grade paper. Since the IPO, the Indian Rupee has weakened by approximately 6% against thepound enhancing potential returns to the Company. Trinity invests in development projects where expected total return IRRs arelikely to be in excess of 25 per cent. After administration and other expensesthe net profit for the period is £2.6 million. The Company has no borrowingsand, as stated at the time of IPO, the Board does not propose an interimdividend. On 19 September 2006 the Board resolved to apply to the High Court of Justice inthe Isle of Man for approval to cancel the Company's share premium and toreclassify it as a distributable reserve to facilitate the Company buying backup to 10% of its issued share capital should it be necessary to address anyshort-term weakness in the Company's share price and enhance shareholders'returns. A preliminary hearing of the Company's Petition is expected within the next twoweeks and it is anticipated that the necessary Court Order will be obtainedwithin approximately four weeks. The share capital reduction only becomeseffective once the Court Order and associated documentation have subsequentlybeen registered at the Companies Registry in the Isle of Man. After suchregistration, the Company will have the ability to execute the share buy-back. Managers' Review In India, Trinity is rapidly gaining recognition for its ability to source andexecute real estate transactions. The Indian real estate market, only recentlyintroduced foreign direct investment in March 2005 and consequently the markethas huge investment potential but is still relatively nascent. Therefore,although the Indian real estate market differs from other real estate markets inthat the transaction process can take longer, the scale of opportunity andpotential returns are also significantly higher. The Indian real estate marketis estimated to be worth US$12 billion and is forecast to reach US$90 billion inten years. To accelerate Trinity's involvement in key areas the management teamhas adopted a partnership approach as set out at the time of IPO. The Companyhas developed partnerships with leading Indian real estate developers andfinancial institutions. An example of this is the two partnership agreements the Company announced inAugust 2006 with IL&FS, one of India's leading financial institutions. These arestrategically important to the future of Trinity and the Company has in totalcommitted £75 million to invest in real estate projects alongside IL&FS. Trinityhas committed £48 million to investing in infrastructure projects and the realestate opportunities that occur alongside these major developments, of which£4.8 million has been drawn down. IL&FS is a leading institution in thedevelopment of infrastructure in India, and recently raised over $500 millionfor investments in real estate in India. Coupled with Trinity's £250 millionfundraising, this partnership will create one of India's largest investmentplatforms focused on real estate. Trinity has also committed £27 million toinvest in the development of real estate in a 50:50 joint venture with IL&FS. In addition, the Company has formed partnerships with Lokhandwala Builders, partof the Lokhandwala Group of companies, a Mumbai based real estate developer andKapstone Constructions, part of Keystone Group, a leading Indian real estatedeveloper. The result of this has been to increase the size and quality of thepipeline available to Trinity. Since 30 September, Trinity has announced the following deals: - £4.8 million investment to acquire 2.5% of IL&FS Transportation & Networks Limited ("ITNL"). This was the first allocation of funds under a partnership arrangement with IL&FS (announced in August) which gives access not only to a solid pipeline of investment opportunity but also brings with it access to allied projects along the transport corridors being developed by ITNL. - £11.6 million investment to acquire a 49% share in a £56m residential project in Worli, Mumbai. The condominium project will develop a total of 1.37 million sq ft of residential space in central Mumbai and sees Trinity playing a major role in Indian Prime Minister Manmohan Singh's campaign to transform Mumbai into a city with global living, housing and infra structure standards. - £28.3 million commitment to an Information Technology Park project in Greater Noida, near New Delhi. The project envisages development of approximately 5.2 million sq ft of Information Technology and Information Technology Services office buildings, 894,000 sq ft of residential apartments, 612,000 sq ft of serviced apartments and hotel space, and 477,000 sq ft of commercial space at a total cost of £215 million. - £10.75 million investment to acquire 16% of a £265 million township development in Mumbai. The township, "Rustomjee's township", will be one of Mumbai's largest integrated townships, with a 7 million sq ft mix of residential, commercial and IT space, with a retail mall, educational, recreational and healthcare facilities. Trinity has the option to increase its investment to 21% for a further £3.5 million, subject to specific criteria being met. Our investment strategy remains focused on investing in suitable commercial andresidential opportunities and we are confident that the extensive marketcontacts and in-depth sector knowledge held by the growing management team willprovide Trinity with a competitive edge in this exciting market. The asset manager's investment team now numbers 22 people based in New Delhi andMumbai and will grow further as investments are made. Investment Pipeline The asset manager and the Company are developing an excellent profile in theirtarget markets. This is leading to a steady stream of opportunities beingpresented to the Company including approaches by private vendors in off markettransactions. Partnership arrangements with well established, reputablefranchises bring a range of possibilities and at the moment more than twentyprojects are being worked on, with a number in advanced stages of due diligence. Outlook We believe we are establishing an excellent portfolio of diversified assets anda reputation for successfully executing complex transactions. During October2006 the Company has announced a series of transactions, involving Trinitytaking a leading role in some of India's most high profile development projects.Each of these has been carefully selected and is expected to meet or exceed theCompany's internal IRR targets of 25%. Looking ahead, we remain focused oncompleting the transactions within the pipeline and with the deals currently invarying stages of negotiation we are confident of meeting the investmenttimetable set at the IPO. Trinity Capital PLCCondensed consolidated interim income statementFor the period from 7 March 2006 (date of incorporation) to 30 September 2006 Group £'000 Expenses Managers' fees (2,233) Other administration fees and expenses (329) ______ Operating loss (2,562) Net financing income Interest income 5,200 ______ Profit before tax 2,638 Taxation - ______ Profit for the period 2,638 ======Attributable to: Equity holders of the company 2,638 ====== Basic and diluted earnings per ordinary share (pence) 1.04 Trinity Capital PLCCondensed consolidated interim balance sheet as at 30 September 2006 Group £'000ASSETSCurrent assets Trade and other receivables 346 Cash and cash equivalents 240,308 ______ Total current assets 240,654 _______ Total assets 240,654 ======EQUITYCapital and reserves attributable to equityholders of the company Issued capital 2,528 Share premium 235,462 Retained earnings 2,638 ______ Total equity 240,628 _______ LIABILITIESCurrent liabilities Trade and other payables 26 ______ Total liabilities 26 _______ Total equity and liabilities 240,654 ====== Net asset value per ordinary share (pence) 95 Trinity Capital PLCCondensed consolidated interim statement of changes in equityFor the period from 7 March 2006 (date of incorporation) to 30 September 2006 Group Share Share Retained Total Capital Premium Reserves £'000 £'000 £'000 £'000Share issue proceeds 2,528 247,500 - 250,028Share issue costs - (12,038) - (12,038)Net profit for the period - - 2,638 2,638 ______ ______ ______ ______ Balance at30 September 2006 2,528 235,462 2,638 240,628 ====== ====== ====== ====== Trinity Capital PLCCondensed consolidated interim cash flow statementfor the period from 7 March 2006 (date of incorporation) to 30 September 2006 Group £'000 Cash flows from operations (2,882) Interest received 5,200 ______ Cash flows from operating activities 2,318 ______ Net cash flows from investing activities - ______Net cash flows from financing activities Proceeds on issue of equity shares net of issue costs 237,990 ______ Increase in cash and cash equivalents 240,308 Cash and cash equivalents at start of period - ______ Cash and cash equivalents at end of period 240,308 ====== Trinity Capital PLC Selected notes to the condensed consolidated financial information for the period from 7 March 2006 (date of incorporation) to 30 September 2006 1. General information The Company is a closed-end investment company, incorporated on 7 March 2006 inthe Isle of Man as a public limited company. It was admitted to the AlternativeInvestment Market of the London Stock Exchange on 21 April 2006. The Group invests in real estate and estate related entities in India, primarilyin commercial development in the office and business space, residential, retailand hospitality sectors deriving returns from development, long-term capitalappreciation and income. The consolidated financial statements comprise the results of the Company andits subsidiaries (together referred to as the "Group"). The interim financialstatements are unaudited. 2. Accounting policies Basis of preparation This condensed interim financial information for the period ended 30 September2006 has been prepared in accordance with International Financial ReportingStandards (IFRS) and with applicable legal and regulatory requirements of Isleof Man law. It has been presented in accordance with IAS34, 'Interim financialreporting'. The financial statements have been presented in Sterling. As this is the first period of operation there are no comparative figures. Thesame accounting policies and methods of computation are followed as are expectedto be applied in the annual financial statements. 3. Share capital and share premium 3.1 Authorised share capital No. of shares £ Ordinary shares of £ 0.01 each 416,750,000 4,167,500Deferred shares of £0.01 each 250,000 2,500 __________ ________ 417,000,000 4,170,000 ========= ======= The Company was incorporated on 7 March 2006 with an authorised share capital of£2,000 comprising 2,000 ordinary shares of £1 each. On 29 March 2006 the authorised share capital was subdivided into 200,000ordinary shares of £0.01 each and increased by the addition of £4,153,000divided into 415,300,000 ordinary shares of £0.01 each, to rank pari passu withthe existing ordinary shares, and by the addition of £15,000 divided into1,500,000 convertible shares of £0.01 each having the rights set out in the NewMemorandum and Articles of Association of the Company. On 21 April 2006 the convertible shares were converted into 1,250,000 ordinaryshares of £0.01 each and 250,000 deferred shares of £0.01 each. 3.2 Issued share capital and share premium No. of Shares Share Share Issued and Capital Premium Fully Paid £ £Ordinary shares of £ 0.01 eachSubscriber shares 200 2 -21 April 2006 - AIM placing 250,000,000 2,500,000 247,500,00021 April 2006 - Placing costs - - (12,037,796)21 April 2006 - issued at parin lieu of structuring fee 1,250,000 12,500 -21 April 2006 - issued at par for cash 1,250,000 12,500 - __________ __________ __________ 252,500,200 2,525,002 235,462,204 Deferred shares of £0.01 each21 April 2006 250,000 2,500 - __________ __________ ________ 252,750,200 2,527,502 235,462,204 ========= ========= ======= The Deferred Shares shall rank pari passu with the Ordinary Shares save that theDeferred Shares shall have no right to dividends or voting rights or the rightto receive notice of or attend any general meeting. On the return of capital ina winding-up of the Company or otherwise (other than re-purchases or redemptionsof shares authorised by special resolution), the Deferred Shares have the rightto return of par value paid up thereon in priority to the return of the parvalue paid up on the Ordinary Shares. On 19 September 2006 the Board resolved to apply to the High Court of Justice inthe Isle of Man to cancel the Company's share premium and reclassify it as adistributable reserve. 4. Basic and diluted earnings per share The basic and diluted earnings per share is calculated by dividing the gains forthe period attributable to ordinary shareholders of £2,638,468 by the weightedaverage number of shares outstanding during the period, being 252,750,200 There are no dilutive potential ordinary shares and therefore diluted earningsper share is the same as basic earnings per share. 5. Net asset value per share The net asset value per share, based on the net assets attributable to ordinaryshareholders at the period end of £240,627,991 divided by 252,750,200 shares inissue at period end, amounts to 95 pence per share. 6. Due diligence costs The Group has an investment pipeline of projects in India which are incurringon-going due diligence costs. 7. Group entities Subsidiaries Country of Ownership incorporation interest Trinity Capital Mauritius Limited Mauritius 100% Trinity Capital (One) Limited Mauritius 100% Trinity Capital (Two) Limited Mauritius 100% Trinity Capital (Three) Limited Mauritius 100% Trinity Capital (Four) Limited Mauritius 100% Trinity Capital (Five) Limited Mauritius 100% Trinity Capital (Six) Limited Mauritius 100% 8. Directors' Interests The following Directors had beneficial interests in the shares of the Company at30 September 2006. Rak Chugh 1,350,000 Ordinary shares M. J. Cassidy 125,000 Ordinary Shares P. D. Orchard-Lisle 20,000 Ordinary Shares This information is provided by RNS The company news service from the London Stock Exchange