Ediston Prop Inv - Half-year Results
25/05/2022 07:00
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RNS Number : 6717M Ediston Property Inv Comp PLC 25 May 2022
THIS ANNOUNCEMENT HAS BEEN DETERMINED TO CONTAIN INSIDE INFORMATION FOR THE
PURPOSES OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014.
Ediston Property Investment Company plc
(the 'Company')
(LEI: 213800JRL87EGX9TUI28)
HALF YEAR RESULTS
MOVING FORWARD WITH A REFRESHED STRATEGY
Ediston Property Investment Company plc (LSE: EPIC) announces its half-year
results for the six months ended 31 March 2022.
Key points for the six months to 31 March 2022:
· Property portfolio increased in value, on a like-for like basis
by 11.2%;
· Net asset value increased 7.1% to 96.1 pence (30 September 2021:
89.7 pence);
· Share price increased by 6.7% to 78.8 pence, narrowing the
discount to 13.1% at the period end;
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· Completed the first phase of the Company's revised investment
strategy by selling the office portfolio, realising net proceeds of £60.0
million;
· Completed 12 lease transactions across office, leisure and retail
warehouse properties;
· 98.2% of the rent due was collected for the period; and
· Various pipeline projects, including investment opportunities and
asset management initiatives being considered.
Key Performance Indicators
Six months ended 31 March Six months ended 31 March Year ended 30 September 2021
2022 2021 (audited)
EPRA NAV per share 96.1p 84.3p 89.7p
NAV total return 10.1% 0.3% 9.6%
Share price total return 10.2% 39.8% 54.6%
Average discount of share price to NAV (17.3)% (24.3)% (22.1)%
EPRA vacancy rate 7.3% 5.6% 8.6%
William Hill, Chairman, commented:
"The Company has made significant progress over the last 12 months. It is
close to completing the restructuring of its portfolio in line with its
revised investment strategy and is now focused on the retail warehouse sector.
This is a part of the market that is now performing strongly."
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Chairman's Statement
introduction
In the first half of the year the Company focused on the execution of its
refreshed investment strategy announced last July. It has made significant
progress. This strategy committed the Company to be invested in retail
warehouse assets for the foreseeable future. Encouragingly, the assets already
owned have increased in value with positive NAV increases recorded for the
last four quarters.
However, whilst the retail warehouse market has flourished over the last six
months, the macro picture has become more challenging as the optimism from the
lifting of COVID-19 restrictions has been dissipated by world events and an
inflationary cost of living crisis.
The highlights of the last six months and post period end are:
· The completion of the sale of all four office properties, a process
that has realised £60.0 million in total. The Company is now focussed on the
retail warehouse sector;
· The NAV has increased by 7.1% over the last six months to 96.1p per
share, despite the impact of selling the office portfolio at below the
valuations at the start of the period;
· The 'like-for-like' increase in the value of the property assets held
throughout the six month period was 11.2%;
· Share price total return over the last twelve months was 21.9% and
10.2% over the last six months. The discount to NAV at the period end was
13.1% (17.6% September 2021) with an average discount of 17.3% during the
period;
· 12 asset management initiatives were undertaken during the period
securing £1.4 million of income per annum;
· Tenant interest in vacant units has picked up and the EPRA vacancy
rate of 8.6% reported at the year-end had fallen to 7.3% at the end of the
period and stands at 6.3% at the date of this report; and
· Post the period end the Company has made good progress in identifying
retail warehouse investments to acquire.
NAV AND SHARE PRICE PERFORMANCE
The Company's investment portfolio was valued at £238.8 million at 31 March
2022 (30 September 2021: £214.8 million on a like-for-like basis). The value
of property assets held throughout the period has risen by 11.2%.
The NAV over the period has increased by 7.1% from 89.7p per share to 96.1p
per share. 6.0% of the increase was recorded over the last three months and
can be attributed to the ongoing recovery in the retail warehouse market where
the Company is now principally invested, other than cash available for future
investment. The NAV total return over the period was 10.1% and the share price
return was 10.2%.
The office portfolio was a drag on performance over the period as the
aggregate sale proceeds of £60.0 million, net of costs, were below the 30
September valuations. Performance was additionally impacted by the costs of
the disposals.
INVESTMENT STRATEGY
The refreshed investment strategy announced in July last year is close to
being executed with the disposal of the offices completed and the reinvestment
of the proceeds into retail warehouses well advanced.
The composition of the portfolio at 31 March 2022 was 97.7% in retail
warehouses and 2.3% in leisure assets. The Company has disposed of one of its
two leisure assets since period end.
The Board remains fully supportive of the Investment Manager's decision to
focus on the retail warehouse sector. Much of the Company's portfolio is
centred on the essential/ value end of the retail market. It is this sector of
the UK commercial property market that stood up well during the Covid crisis
and remained largely open during lockdown periods. It is also likely to be
more insulated from any consumer spending headwinds from the cost of living
crisis than other parts of the retail and leisure economy. Evidence continues
to point to retail warehousing working well with the digital economy and its
ability to provide efficient and cost-effective accommodation for retailers.
Vacancy is lower than the office and industrial sectors. There is virtually no
new supply, and poor schemes are being taken out of the market as they are
repurposed for other uses. Rents are starting to recover as retailers now face
competition for the best available space.
The Investment Manager has maintained for some time that the sector was
oversold by investors and this view is now held more widely. The February 2022
Investment Property Forum Consensus forecast, drawn on its survey work with
investors, has the retail warehouse sector as the best performing property sub
sector for the period from 2022 to 2026.
PORTFOLIO and transaction ACTIVITY
During the period the Investment Manager has completed twelve new asset
management initiatives with a further one post period end. These are discussed
in more detail in the Investment Manager's report. The transaction at
Prestatyn Shopping Park, completed post period end, is a good example of how
the market balance between landlord and tenant is shifting. The Investment
Manager has successfully replaced New Look, a tenant trading on preferential
terms secured under a CVA, with JD Sports, at a market rent 44.0% ahead of the
turnover rent being paid by New Look.
The improving letting market is helping to reduce vacancy levels in the
portfolio with the EPRA vacancy rate of 7.3% at the end of the period falling
to 6.3% post period end.
All four office assets in the portfolio (Bath, Edinburgh, Newcastle and
Birmingham) were sold during the period realising net sale proceeds of £60.0
million. These were sold into a difficult office market struggling with
understanding the implications for the sector of working from home, the
changing needs of occupiers and concerns over the costs for older buildings to
comply with future sustainability regulations. The assets were sold at 3.3%
below the property valuations at the time of the sales, and were therefore a
drag on performance during the period. However, the Board agreed with the
Investment Manager that the downside was not fully in the pricing and the
capital could be used more effectively if deployed into retail warehousing.
The Investment Manager is well advanced with the reinvestment of the office
sale proceeds and announcements on acquisitions will be made in the normal way
as and when contracted.
The Board has continued to work closely with the Investment Manager on
achieving the Company's sustainability goals. This progress will be reported
on in detail in the next annual report.
INCOME AND DIVIDEND
Rent collection continues to be strong. 98.2% of the rent due for the
six-month period was collected by the period end.
Disposing of the offices and reinvesting the proceeds into retail warehousing
has created a hiatus in the Company's income profile during the execution of
this strategy. The Board believes that it is not prudent to consider
increasing the dividend until the portfolio has been re-positioned. The Board
will update shareholders further on both investing for the portfolio and the
resultant net income position when it is able to do so.
CAPITAL STRUCTURE
The Company's total debt is unchanged at £111.1 million at a blended 'all-in'
fixed rate of 2.9%. Gearing at 31 March 2022 was 35.0% of total assets. As at
31 March 2022, the Company had approximately £41.2 million of cash for
investment and operational purposes. The Company had a further £36.3 million
of cash held in its debt facility, including the Hartlepool sale proceeds.
This cash is subject to the lender's LTV requirements being met for it to be
released for investment purposes.
At the date of the March valuation, the average loan-to-value across the
Company's two debt facilities was 32.4%. The Company is fully compliant with
all debt covenants and has significant headroom against income and asset value
covenants.
board
We have managed the Company's affairs with a small and highly engaged board
from the inception of the Company. We intend to continue to do so whilst
mindful of corporate governance issues on Board composition, diversity and
collective competence to undertake the tasks. One immediate issue is
succession planning which was referred to in last year's report and accounts.
The aim is to have an orderly Board transition, enabling the two longest
serving board members (Chair and Audit Chair) to stand down from the Board, in
the absence of unforeseen circumstances, no later than the AGM in 2024.
At the Company's AGM, all the resolutions put to the meeting were passed by
substantial margins. However, voting agencies raised concerns over Mr
Archibald's independence in acting as SID and Audit Chair, given the roles he
was fulfilling on the Board and how he was remunerated. This resulted in
recommendations to vote against his reappointment at the 2022 AGM. The Board
and its advisers do not agree with the voting agencies' views on independence
and continue to benefit from Mr Archibald fulfilling the roles that he does
for the Board. However, the Board does not want governance issues to be a
distraction in the lead up to the next AGM of the Company.
Accordingly, Ms Moss has been appointed as Senior Independent Director from 1
June 2022 and Mr Archibald will be replaced as Audit Chair before year end.
Recruitment consultants have been appointed for a new Audit Chair and the
Board will increase in size to five when this appointment is made. Mr
Archibald will remain as a non-executive director, at least for the next year,
whilst Board transition is taking place, to assist in the growth strategy of
the Company and to continue to act as director overseeing corporate issues
that arise for the Company.
OUTLOOK
The Company has made significant progress over the last 12 months. It is close
to completing the restructuring of its portfolio in line with its revised
investment strategy and is now focused on the retail warehouse sector. This is
a part of the market that is now performing strongly and one which consensus
forecasts suggest will continue to do so over the next few years.
The Board hopes that the positive progress on implementing the refreshed
investment strategy, along with other initiatives being considered, will help
close the share price discount to NAV. The Investment Manager will continue to
review opportunities to grow the Company, which might include use of the tap
issuance authorities for individual asset opportunities. In parallel with the
longer term ambition for growth, the Investment Manager will continue to
generate value adding asset management opportunities and to drive income
growth which will support the potential for increases in the dividend.
William Hill
Chairman
24 May 2022
Investment Manager's Review
Introduction
The first half of the Company's financial year has seen positive momentum
build across various parts of the property portfolio, driven by the continued
recovery in the retail warehouse market. The NAV has improved, the EPRA
vacancy rate has fallen, rent collection has remained strong and asset
management initiatives have been identified and completed which have also
improved the Company's income stream. Good progress has been made with the
revised strategy, announced in quarter three 2021, to sell offices and
reinvest in retail warehouses. During the period all four of the office assets
were sold.
Portfolio Composition
The Company can invest in all the principal commercial property sectors and
does not diversity for diversification's sake. There is no constraint limiting
the maximum weighting to any of the main property sectors.
The Company's property portfolio is valued by Knight Frank on a quarterly
basis throughout the year. As at 31 March 2022 it was valued at £238.8
million, a like-for-like increase of 11.2% compared to the 30 September 2021
valuation. The allocation is detailed in the table below.
Retail Warehouse Leisure
Number of properties 11 2
Value £233.2 million £5.6 million
Sector weighted average unexpired lease term (WAULT) 4.9 years 0.5 years
Total contracted rent per annum £15.9 million £0.6 million
The WAULT of the property portfolio as at 31 March 2022 was 4.9 years.
Following a strategy update in quarter three 2021, the Company will focus the
next phase of reinvestment on the retail warehouse sector. In line with this
strategy, the Company exited its office portfolio during the period and at the
period end was invested in the retail warehouse and leisure sectors as
follows:
Sector Exposure (%)
Retail warehouse 97.7
Other commercial/ Leisure 2.3
Geographical diversification as at 31 March 2022
The portfolio is diversified across the regional markets.
Region Exposure (%)
Scotland 26.1
Wales 25.9
North West 16.3
Yorkshire 15.0
North East 9.2
East Midlands 6.2
West Midlands 1.3
Top five tenants as at 31 March 2022
The top five tenants comprise 37.1% of the Company's rent roll. The remaining
62.9% is made up of tenants who individually do not comprise more than 3.8% of
the rent roll.
Tenant Exposure (%)
B&Q Limited 14.7
B&M Retail Limited 7.7
Marks & Spencer plc 6.3
Boots UK Limited 4.6
Pets at Home Limited 3.8
rent collection
The Company maintained strong rent collection levels during the period. For
the six months to 31 March 2022, 98.2% of the rent due has been collected. The
rent collection since quarter two 2021 is summarised in the following table:
Quarter Q2 2021 (%) Q3 2021 (%) Q4 2021 (%) Q1 2022 (%)
Rent received 96.0 99.1 97.7 98.2
Payment expected 0.5 0.9 2.3 1.8
Deferred 3.1 0.0 0.0 0.0
Under discussion 0.0 0.0 0.0 0.0
Outstanding 0.4 0.0 0.0 0.0
Total 100 100 100 100
The Company's income stream has been resilient and has not been negatively
affected by any tenant insolvency events in the period. However, because of
the property sales in the period, the Company's contracted income has
temporarily reduced. Over the period, on a like-for-like basis, accounting for
the office sales, the contracted rent increased by 1.5% and the ERV increased
by 1.7%. The objective is to replace the sold office income with rent from
suitable retail warehouse properties.
NAV
The NAV increased in the period by 7.1% to 96.1p, with four consecutive
quarters of NAV growth for the Company. Over the 12 months ended 31 March
2022, the NAV increased by 14.0%. This positive momentum is primarily because
of valuation increases in the retail warehouse portfolio. General market
movement, and the completion of asset management initiatives have both
contributed to the upwards direction of travel. The disposal of the office
portfolio had a negative impact on NAV growth.
Asset Management Activity
During the period, 12 asset management initiatives were completed in the
property portfolio, across the office, leisure and retail warehouse assets,
securing £1.4 million of rental income per annum, which is in line with ERV.
They are summarised below:
Retail Warehouse
· At Kingston Retail Park in Hull, The Range signed a 15-year lease
on a 14,500 sq. ft. unit which was vacated by Outfit (Arcadia) in Q2 2021;
· Also at Hull, Greggs signed a 10-year lease with a five-year
tenant break option on a 2,000 sq. ft. unit;
· At Prestatyn Shopping Park, The Tech Edge leased a vacant unit of
1,300 sq. ft. on a five-year lease;
· At Clwyd Retail Park, Rhyl, Now to Bed leased 8,017 sq. ft. on a
three-year lease;
· At Barnsley, Bensons downsized from a unit of 10,000 sq. ft. into
one of 5,036 sq. ft. and signed a five-year lease;
· Jysk signed a 10-year lease with a five-year break option on the
unit vacated by Bensons;
· Also at Barnsley, One Below, occupying a 4,996 sq. ft. unit on a
short-term lease, committed to the park for five years;
· At Widnes Shopping Park, Card Factory signed a five-year lease,
without break, on a 1,590 sq. ft. unit; and
· At Stirling, Harry Corry signed a five-year lease extension on
its 9,968 sq. ft. unit, meaning its lease will now expire in February 2027.
At Prestatyn Shopping Park, JD Sports exchanged an Agreement for Lease (AFL)
on a 7,623 sq. ft. unit, which was previously occupied by New Look. New Look
was occupying the unit on a turnover rent basis following the approval of its
Company Voluntary Arrangement (CVA). Under the terms of the CVA landlords were
entitled to break the leases.
We considered that the terms of the CVA were below market, so we took the
opportunity to exercise the break clause and identified JD Sports as a more
suitable tenant for the space. Post-period-end, the lease has completed. The
rent received from JD Sports is 44.0% higher than the rent being paid by New
Look.
Office
· At Citygate II in Newcastle, UNW LLP signed an extension to its
leases, to expire in March 2032, with a tenant break option in March 2027.
Subsequent to this deal completing, the asset was sold.
Leisure
· At Hartlepool, Mecca Bingo signed a 10-year reversionary lease
with a seven-year tenant break option on its 31,284 sq. ft unit. The lease
expiry date was extended to September 2032, with a break option in September
2029. Post-period-end the property was sold.
We are seeing improving occupational demand from retail warehouse tenants for
both the vacant units and on lease extensions and we are currently in
discussions with several tenants across multiple assets.
ASSET SALES & REINVESTMENT
The Company's four remaining office assets were sold, for a headline price of
£61.9 million. This is 3.3% below the property valuations at the time of the
sales. Once deductions for topped up rents and rent-free periods were factored
in, the net receipt to the Company was £60.0 million.
The sales were in line with the Company's investment approach of seeking to
identify and capitalise on attractive investment themes and opportunities as
they arise and evolve across the UK commercial property sector. We have
recently been repositioning the portfolio to focus on the retail warehouse
sector, with good progress being made with the reinvestment phase.
Post period end, the Company completed the sale of one of its two leisure
assets. The Lanyard, Hartlepool was sold for £2.62 million. The asset is let
to Mecca Bingo Limited. We had completed a lease extension with the tenant in
quarter four last year which extended the unexpired lease term by seven years.
The intention is to reinvest the sale proceeds into the retail warehouse
sector, a sector in which we have extensive experience as a developer,
investor and asset manager. We believe the prospects are attractive for retail
warehouses, both in absolute terms and relative to other sectors of the real
estate market.
ESG UPDATE
During the period, the Company continued to make good progress in implementing
its ESG objectives. The Company has delivered improvements across the four
focus areas of its Sustainability Strategy. Some of the achievements are
highlighted below:
· Announced a Net Zero Commitment within the Annual Report and
Accounts 2021 and developed a pathway towards net zero;
· Delivered employee ESG training, focused on Sustainable Design
and Environmental Management;
· Developed a Supplier Code of Conduct;
· Assessed the Environmental Management System against the ISO14001
standard;
· Undertook an occupier satisfaction survey with a focus on ESG;
· Continued progress against 100% Renewable Electricity by 2023;
· Implemented emissions reduction activities through Asset
Sustainability Plans, which are due to be completed in Q3 2022;
· Maintained alignment to EPRA Best Practices Recommendations for
Sustainability Reporting (sBPR);
· Improved alignment to the Task Force on Climate-related Financial
Disclosures (TCFD) recommendations;
· Developed a GRESB improvement plan and commenced submission for
2022; and
· Began assessment of the climate change physical and transition
risks.
A full update on the Company's ESG progress will be provided in the annual
report and accounts later this year.
Outlook
This has been a positive period for the Company, with progress made across
several key metrics. However, there are some headwinds building which could
affect the Company. Global supply chain issues, rising inflation and the
squeeze on household incomes all pose a risk to the economy and the forecast
recovery since the health crisis. Inflation may prove to be less transitory
than previously forecast, interest rates could increase further by the end of
2022 and consumers might have less money in their pockets to spend - all of
which could impact on retail, particularly discretionary purchasing. However,
our tenant line-up is underpinned by convenience led retailers, a strength
during the pandemic when retail was under pressure.
Whilst these issues must be borne in mind, there are still plenty of reasons
to be optimistic. There is no doubt that the Company is in a much stronger
position than it was 12 months ago. There are no signs that investment demand
for retail warehousing will wane in the near term, which should lead to
further NAV improvement. There is good occupational demand from tenants
looking to extend leases and acquire new space. In a sector with low supply
levels, this could lead to rental growth. Rent collection remains strong, the
EPRA vacancy rate has fallen, and we continue to identify and complete asset
management projects across multiple properties.
Our key objective currently is to reinvest the proceeds from the sale of the
office portfolio and once we are fully invested to take the next steps towards
growth and delivering a progressive dividend.
All this asset management and investment activity means the Company has a
reshaped portfolio and a strategy focused on a sector which is forecast to
perform well. This gives the Company a solid platform on which to build and
deliver growth in asset value and income, which remain the key long-term
objectives of the Company.
Calum Bruce
Investment Manager
24 May 2022
Statement of Principal and emerging Risks and Uncertainties
The risks, and the way in which they are managed, are described in more detail
under the heading 'Principal and emerging risks' within the Strategic Report
in the Group's Annual Report and Accounts for the year ended 30 September
2021. The Group's principal and emerging risks have not changed materially
since the date of that report, other than the events in Ukraine, and its
geopolitical and economic impacts, and the heightened inflationary risks to UK
and other developed economies.
The Board regularly reviews the principal and emerging risks and uncertainties
faced by the Company together with the mitigating actions it has established
to manage the risks. These are set out within the Strategic Report contained
within the Annual Report for the year ended 30 September 2021 and comprise the
following risk headings:
· Investment strategy and performance;
· Premium and discount level;
· Financial;
· Regulatory;
· Operational; and
· Economic, governmental and exogenous
In addition to these categories of risks, the Board is conscious of the
continuing impact on the global economy and financial markets caused by the
Covid-19 pandemic which emerged in early 2020. Added to this has been the more
recent geopolitical risk and impact of events in Ukraine and the heightened
inflationary impact affecting many developed economies, including the impact
on living costs and discretionary income. The Board considers that these risks
could have further implications for financial markets and the operating
environment of the Company.
DIRECTORS' RESPONSIBLIITIES
Directors' Responsibility Statement
The Directors are responsible for preparing the Half Yearly Financial Report
in accordance with applicable law and regulations. The Directors confirm that
to the best of their knowledge:
· the condensed set of interim financial statements within the
Half Yearly Financial Report has been prepared in accordance with IAS 34
'Interim Financial Reporting' of the UK-adopted IFRS; and
· the Interim Board Report (constituting the Interim Management
Report) includes a fair review of the information required by rules 4.2.7R of
the Disclosure Guidance and Transparency Rules (being an indication of
important events that have occurred during the first six months of the
financial year and their impact on the condensed set of financial statements
and a description of the principal risks and uncertainties for the remaining
six months of the financial year) and 4.2.8R (being related party transactions
that have taken place during the first six months of the financial year and
that have materially affected the financial position of the Company during
that period; and any changes in the related party transactions described in
the last Annual Report that could so do).
These interim financial statements are unaudited and have not been subject to
review by the audit firm.
On behalf of the Board
William Hill
Chairman
24 May 2022
Financial Statements
Condensed Consolidated Statement of Comprehensive Income
For the six months ended 31 March 2022
Notes Six months ended 31 March 2022 (unaudited) Six months ended Year ended
31 March
30 September
2021 (unaudited)
2021 (audited)
Total Total
£'000 £'000
Revenue Capital Total
£'000 £'000 £'000
Revenue
Rental income 8,016 - 8,016 9,107 17,371
Other income 463 - 463 - -
Total revenue 8,479 - 8,479 9,107 17,371
Unrealised loss on revaluation of investment properties 5 - 11,516 11,516 (5,324) 4,655
Gain on sale of investment properties realised 5 - 2,944 2,944 192 1,179
Total income 8,479 14,460 22,939 3,975 23,205
Expenditure
Investment management fee 2 (834) - (834) (824) (1,687)
Other expenses (1,845) - (1,845) (1,132) (1,914)
Total expenditure (2,679) - (2,679) (1,956) (3,601)
Movement in expected credit losses 50 - 50 89 615
Profit/(loss) before finance costs and taxation 5,850 14,460 20,310 2,108 20,219
Net finance costs
Interest receivable 1 - 1 - -
Interest payable (1,540) - (1,540) (1,588) (3,109)
Profit/(loss) before taxation 4,311 14,460 18,771 520 17,110
Taxation - - - - -
Profit/(loss) and total comprehensive income for the period 4,311 14,460 18,771 520 17,110
Basic and diluted earnings per share 3 2.0p 6.9p 8.9p 0.3p 8.1p
The total column of this statement represents the Group's Condensed
Consolidated Statement of Comprehensive Income, prepared in accordance with
IFRS.
The supplementary revenue return and capital return columns are prepared under
guidance published by the Association of Investment Companies.
All revenue and capital items in the above statement are derived from
continuing operations.
No operations were acquired or discontinued in the period.
The accompanying notes are an integral part of these condensed consolidated
financial statements.
Condensed Consolidated Statement of Financial Position
As at 31 March 2022
Notes As at As at As at
31 March 2022
31 March 2021
30 September 2021
(unaudited)
(unaudited)
(audited)
£'000 £'000 £'000
Non-current assets
Investment properties 5 235,078 242,008 277,984
235,078 242,008 277,984
Current assets
Trade and other receivables 38,572 33,194 13,390
Cash and cash equivalents 43,417 16,186 11,642
81,989 49,380 25,032
Total assets 317,067 291,388 303,016
Non-current liabilities
Loans 6 (110,360) (110,195) (110,277)
(110,360) (110,195) (110,277)
Current liabilities
Trade and other payables (3,671) (3,126) (3,190)
Total liabilities (114,031) (113,321) (113,467)
Net assets 203,036 178,067 189,549
Equity and reserves
Called-up equity share capital 7 2,113 2,113 2,113
Share premium 125,559 125,559 125,559
Capital reserve - investments held (31,194) (52,689) (42,710)
Capital reserve - investments sold 6,505 2,574 3,561
Special distributable reserve 82,454 82,893 82,711
Revenue reserve 17,599 17,617 18,315
Equity shareholders' funds 203,036 178,067 189,549
Net asset value per Ordinary Share 8 96.1p 84.3p 89.7p
The accompanying notes are an integral part of these condensed consolidated
financial statements.
The unaudited condensed financial statements on pages 8 to 14 were approved by
the Board of Directors and authorised for issue on 24 May 2022 and were signed
on its behalf by:
William Hill
Chairman
Registered number: 09090446
Condensed Consolidated Statement of Changes in Equity
For the six months ended 31 March 2022 (unaudited)
Share capital account Share premium Capital reserve - investments held Capital reserve - investments sold Special distributable reserve Revenue reserve Total equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
As at 30 September 2021 2,113 125,559 (42,710) 3,561 82,711 18,315 189,549
Profit and total comprehensive income for the period - - 11,516 2,944 - 4,311 18,771
Transactions with owners recognised in equity:
Dividends paid - - - - - (5,284) (5,284)
Transfer from special reserve - - - - (257) 257 -
As at 31 March 2022 2,113 125,559 (31,194) 6,505 82,454 17,599 203,036
For the six months ended 31 March 2021 (unaudited)
Share capital account Share premium Capital reserve - investments held Capital reserve - investments sold Special distributable reserve Revenue reserve Total equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
As at 30 September 2020 2,113 125,559 (47,365) 2,382 83,162 15,922 181,773
(Loss)/Profit and total comprehensive income for the period - - (5,324) 192 - 5,652 520
Transactions with owners recognised in equity:
Dividends paid - - - - - (4,226) (4,226)
Transfer from special reserve - - - - (269) 269 -
As at 31 March 2021 2,113 125,559 (52,689) 2,574 82,893 17,617 178,067
For the year ended 30 September 2021 (audited)
Share capital account Share premium Capital reserve - investments held Capital reserve - investments sold Special distributable reserve Revenue reserve Total equity
£'000 £'000 £'000 £'000 £'000 £'000 £'000
As at 30 September 2020 2,113 125,559 (47,365) 2,382 83,162 15,922 181,773
Loss and total comprehensive income for the year - - 4,655 1,179 - 11,276 17,110
Transactions with owners recognised in equity:
Dividends paid - - - - - (9,334) (9,334)
Transfer from special reserve - - - - (451) 451 -
As at 30 September 2021 2,113 125,559 (42,710) 3,561 82,711 18,315 189,549
The accompanying notes are an integral part of these condensed consolidated
financial statements.
Condensed Consolidated Cash Flow Statement
For the six months ended 31 March 2022
Six months ended Six months ended Year ended
31 March 2022
31 March 2021
30 September 2021
(unaudited)
(unaudited)
(audited)
£'000
£'000 £'000
Cash flows from operating activities
Profit/(loss) before tax 18,771 520 (17,110)
Adjustments for:
Interest receivable (1) - -
Interest payable 1,540 1,588 3,109
Unrealised revaluation (gain)/loss on property portfolio (11,516) 5,324 (4,655)
Gain on sale of investment property realised (2,944) (192) (1,179)
Operating cash flows before working capital changes 5,850 7,240 14,385
(Increase)/decrease in trade and other receivables (26,296) (18,078) 1,823
Increase/(decrease) in trade and other payables 653 (538) (492)
Net cash (outflow)/inflow from operating activities (19,793) (11,376) 15,716
Cash flows from investing activities
Capital expenditure (1,630) (5,512) (10,345)
Acquisition of investment properties - - (21,640)
Sale of investment properties 60,084 26,466 27,953
Net cash inflow/(outflow) from investing activities 58,454 20,954 (4,032)
Cash flows from financing activities
Dividends paid (5,284) (4,090) (9,334)
Interest received 1 - -
Interest paid (1,603) (1,610) (3,016)
Net cash outflow from financing activities (6,886) (5,700) (12,350)
Net increase/(decrease) in cash 31,775 3,878 (666)
Opening cash and cash equivalents 11,642 12,308 12,308
Closing cash and cash equivalents 43,417 16,186 11,642
The accompanying notes are an integral part of these condensed financial
statements.
Notes to the Condensed Consolidated Financial Statements
1. General information
Basis of preparation
These unaudited condensed consolidated financial statements for the six month
period ended 31 March 2022 have been prepared in accordance with UK-adopted
International Financial Reporting Standards (IFRS) and the accounting policies
set out in the statutory accounts of the Group for the year ended 30 September
2021. The unaudited condensed consolidated financial statements for the six
month period ended 31 March 2022 do not include all the information required
for a complete set of IFRS financial statements and should be read in
conjunction with the financial statements of the Group for the year ended 30
September 2021, which were prepared under UK-adopted IFRS. The accounting
policies adopted in this report are consistent with those applied in the
Group's audited financial statements for the year ended 30 September 2021. The
accounting policies applied in the preparation of this financial information
are expected to be consistently applied in the financial statements for the
year to 30 September 2022. Based on the current operations of the Group, no
other new or revised accounting standards have been issued that are expected
to have a material effect on the Group's financial statements in the future.
There have been no significant changes to management judgements and estimates
since 30 September 2021.
The Company is a public listed company incorporated and domiciled in England
and Wales. The Company's ordinary shares are listed on the Premium Segment
of the Official List and traded on the London Stock Exchange's Main Market.
The Group follows the Real Estate Investment Trust (REIT) regime for the
purposes of UK taxation.
The registered address of the Company is disclosed in the Corporate
information.
going concern
The condensed consolidated financial statements have been prepared on the
going concern basis. In assessing the going concern basis of accounting the
Directors have had regard to the guidance issued by the Financial Reporting
Council.
The Company's assets consist mainly of UK commercial property assets. The
condensed consolidated financial statements have been prepared on the going
concern basis. In assessing the going concern basis of accounting the
Directors have had regard to the guidance issued by the Financial Reporting
Council. After making enquiries, and bearing in mind the nature of the Group's
business and assets, the Directors consider that the Group has adequate
resources to continue in operational existence over the medium term. For these
reasons, the Board continues to adopt the going concern basis in preparing
these financial statements.
The Board has set limits for borrowing and regularly reviews actual exposures,
cash flow projections and compliance with banking covenants, including the
headroom available. The Board also reviews sensitivity analysis of the Group's
operations and the ability to fulfil its operational commitments under
different stress scenarios.
Having taken these factors into account, the Directors believe that the
Company has adequate resources to continue in operational existence for the
foreseeable future and is able to meet its financial obligations as they fall
due for the period to 23 May 2023, which is at least twelve months from the
date of approval of this Report. For these reasons, they continue to adopt the
going concern basis of accounting in preparing the financial statements.
2. Investment Management Fee
Six months ended Six months ended Year ended
31 March 2022
31 March 2021
30 September 2021
£'000
£'000
£'000
Investment management fee 834 824 1,687
Total 834 824 1,687
Ediston Investment Services Limited has been appointed as the Company's
Alternative Investment Fund Manager (AIFM) and investment manager, with the
property management services for the Group being delegated to Ediston
Properties Limited. Ediston Investment Services Limited is entitled to a fee
calculated as 0.95% per annum of the net assets of the Group up to £250m,
0.75% per annum of the net assets of the Group over £250m and up to £500m
and 0.65% per annum of the net assets of the Group over £500m. The management
fee on any cash available for investment (being all cash held by the Group
except cash required for working capital and capital expenditure) is reduced
to 0.475% per annum while such cash remains uninvested. The Management fee is
reduced by a quarterly contribution of £10,000 (£40,000 per annum) towards
the overall management costs of the Company.
Ediston Investment Services Limited has committed to investing 20.0% of the
quarterly management fee in the Company's shares each quarter for a period of
three years commencing 1 October 2020. Refer to note 10 for further
information.
3. Earnings per Share
Six months ended Six months ended Year ended
31 March 2022
31 March 2021
30 September 2021
£'000 Pence per share £'000 Pence per share £'000 Pence per share
Revenue earnings 4,311 2.0 5,652 2.7 11,276 5.3
Capital earnings 14,460 6.9 (5,132) (2.4) 5,834 2.8
Total earnings 18,771 8.9 520 0.3 17,110 8.1
Average number of shares in issue 211,333,737 211,333,737 211,333,737
Earnings for the period to 31 March 2022 should not be taken as a guide to the
results for the year to 30 September 2022.
4. Dividends
Six monthly dividends of 0.4167 pence per share, at a cost of £5,284,000 (six
monthly dividends at a rate of 0.3333 pence per share for the six months ended
31 March 2021, at a cost of £4,224,000) were paid during the period. The rate
was increased from 0.3333 pence per share to 0.4167 pence per share in May
2021.
A seventh interim dividend for the year ending 30 September 2022, of 0.4167
pence per share, will be paid on 31 May 2022 to shareholders on the register
on 13 May 2022. This monthly dividend of 0.4167 pence per share equates to an
annualised dividend level of 5.00 pence per share.
All of the distributions made by the Company have been Property Income
Distributions (PIDs).
5. Investment Properties
Freehold and leasehold properties As at As at As at
31 March 31 March 30 September
2022 2021 2021
£'000 £'000 £'000
Opening book cost 320,694 315,611 315,611
Opening unrealised appreciation (42,710) (47,365) (47,365)
Opening fair value 277,984 268,246 268,246
Movement for the period
Acquisitions - - 21,850
Sales
- net proceeds (60,084) (26,466) (27,953)
- gain on sales 2,944 192 1,179
Capital expenditure 2,719 5,360 10,007
Movement in book cost (54,421) (20,914) 5,083
Unrealised gain realised during the year - - -
Unrealised gains on investment properties 23,086 598 10,798
Unrealised losses on investment properties (11,571) (5,922) (6,143)
Movement in fair value (42,906) (26,238) 4,655
Closing book cost 266,273 294,697 320,694
Closing unrealised (depreciation) (31,195) (52,689) (42,710)
Closing fair value 235,078 242,008 277,984
During the period ended 31 March 2022 the Group sold office properties at
Bath, Newcastle, Edinburgh and Birmingham. The Group received a net amount of
£60,084,000 from investments sold in the period. The book cost of the
investments when it was purchased was £58,016,000. This investment has been
revalued over time and, until it was sold, any unrealised gains/losses were
included in the fair value of the investments.
The fair value of the investment properties reconciled to the appraised value
as follows:
Six months ended Six months ended Year ended
31 March 2022 31 March 2021 30 September 2021
£'000 £'000 £'000
Closing fair value 235,078 242,008 277,984
Lease incentives held as debtors 3,742 4,842 5,361
Appraised market value per Knight Frank 238,820 246,850 283,345
Changes in the valuation of investment properties
Six months ended Six months ended Year ended
31 March 2022 31 March 2021 30 September 2021
£'000 £'000 £'000
Gain on sale of investment properties 2,944 192 1,179
Gain on sale of investment properties realised* 2,944 192 1,179
Unrealised gains on investment properties 23,086 598 -
Unrealised (losses)/gains on investment properties (11,571) (5,922) 4,655
Total gain/(loss) on revaluation of investment properties 14,459 (5,132) (5,834)
*Represents the difference between the sales proceeds, net of costs, and the
property valuation at the end of the prior year.
5. Investment Properties continued
The loss on revaluation of investment properties reconciles to the movement in
appraised market value as follows:
Six months ended Six months ended Year ended
31 March 2022 31 March 2021 30 September 2021
£'000 £'000 £'000
Total loss on revaluation of investment properties 14,459 (5,132) 4,655
Purchases - - 21,850
Capital expenditure 2,719 5,360 10,007
Sales - net proceeds (60,084) (26,466) (26,774)
Movement in fair value (42,906) (26,238) 9,738
Movement in lease incentives held as debtors (1,619) 113 632
Movement in appraised market value (44,525) (26,125) 10,370
At 31 March 2022, the properties were valued at £238,820,000 (31 March 2021:
£246,850,000 and 30 September 2021: £283,345,000) by Knight Frank LLP
(Knight Frank), in their capacity as external valuers. The valuation was
undertaken in accordance with the current editions of RICS Valuation - Global
Standards, which incorporate the International Valuation Standards, and the
RICS UK National Supplement.
Fair value is based on an open market valuation (the price that would be
received to sell an asset, or paid to transfer a liability, in an orderly
transaction between market participants at the measurement date), provided by
Knight Frank on a quarterly basis, using recognised valuation techniques as
set out in the accounting policies and Note 9 of the consolidated financial
statements of the Group for the year ended 30 September 2021. The valuations
are the ultimate responsibility of the Directors. Accordingly, the critical
assumptions used in establishing the independent valuation are reviewed by the
Board.
There were no other significant changes to the valuation process, assumptions
or techniques used during the period.
6. Loans
As at As at As at
31 March 31 March 30 September
2022 2021 2021
£'000 £'000 £'000
Principal amount outstanding 111,076 111,076 111,076
Set-up costs (1,612) (1,612) (1,612)
Amortisation of loan set-up costs 896 731 813
Total 110,360 110,195 110,277
The Group's loan arrangements are with Aviva Commercial Finance Limited.
The Group has loans totalling £56,920,000 which carry a fixed blended
interest rate of 2.9% and mature in May 2025. This rate is fixed for the
period of the loan as long as the loan-to-value is maintained below 40.0%,
increasing by ten basis points if the loan-to-value is 40.0% or higher. These
loans are secured over EPIC (No.1) Limited's property portfolio. The Group
also has loans totalling £54,156,000 which carry a fixed interest rate of
2.7% and mature in December 2027. This rate is fixed for the period of the
loan as long as the loan-to-value is maintained below 40.0%, increasing by ten
basis points if the loan-to-value is 40.0% or higher. These loans are secured
over EPIC (No.2) Limited's property portfolio.
Under the terms of early repayment relating to the loans, the cost of repaying
the loans on 31 March 2022, based on the yield on the Treasury 5% 2025 and
Treasury 4.25% 2027 plus a margin of 0.5%, would have been approximately
£114,084,000 (31 March 2021: £122,222,000 and 30 September 2021:
£120,268,000), Including repayment of the principal £111,076,000 (31 March
2021: £111,076,000 and 30 September 2021: £111,076,000).
The fair value of the loans based on a marked-to-market basis, being the yield
on the relevant Treasury plus the appropriate margin, was £109,969,000 at 31
March 2022 (31 March 2021: £116,274,000 and 30 September 2021:
£114,918,000). This includes the principal borrowed.
7. Called-up Equity Share Capital
The Company had 211,333,737 Ordinary Shares of 1 pence par value in issue at
31 March 2022 (31 March 2021: 211,333,737 and 30 September 2021: 211,333,737).
During the period to 31 March 2022, the Company did not issue any Ordinary
Shares (six months ended 31 March 2021: issued none; year ended 30 September
2021: issued none). The Company did not buyback or resell from treasury any
Ordinary Shares during the period or during either comparative period.
The Company did not hold any shares in treasury at 31 March 2022 (31 March
2021: nil and 30 September 2021: nil).
8. Net Asset Value
The Group's net asset value per Ordinary Share of 96.1 pence (31 March 2021:
84.3 pence and 30 September 2021: 89.7 pence) is based on equity shareholders'
funds of £203,036,000 (31 March 2021: £178,087,000 and 30 September 2021:
£189,549,000) and on 211,333,737 (31 March 2021: 211,333,737 and 30 September
2021: 211,333,737) Ordinary Shares, being the number of shares in issue at the
period end.
The net asset value calculated under IFRS is the same as the EPRA net asset
value as at 31 March 2022 and for both comparative periods.
9. Investment in subsidiaries
The Group's results consolidate those of EPIC (No.1) Limited, a wholly owned
subsidiary of Ediston Property Investment Company plc, incorporated in England
& Wales on 27 June 2014 (Company Number: 09106328) and EPIC (No.2)
Limited, a wholly owned subsidiary of Ediston Property Investment Company plc,
incorporated in England & Wales on 23 September 2017 (Company Number:
10978359). The subsidiaries hold all the investment properties owned by the
Group and are also the parties which hold the Group's borrowings (see Note 6).
10. Related Parties
There have been no material transactions between the Company and its Directors
during the period other than amounts paid to them in respect of expenses and
remuneration for which there were no outstanding amounts payable at the period
end.
Ediston Investment Services Limited has received investment management fees of
£834,000 in relation to the six months ended 31 March 2022 (six months ended
31 March 2021: £824,000 and year ended 30 September 2021: £1,687,000) of
which £424,068 (31 March 2021: £411,213 and 30 September 2021: £437,000)
remained payable at the period end. Ediston Investment Services Limited
received no development management fees in relation to the six months ended 31
March 2022 (six months ended 31 March 2021: £177,000 and year ended 30
September 2021: £257,000) with £nil (31 March 2021: £nil and 30 September
2021: £nil) payable at the period end.
The aggregate shareholding of the manager and its senior personnel as at 31
March 2022 is 2,378,244 shares, 1.1% of the issued share capital as at that
date.
11. Commitments
As at 31 March 2022 the Group had contractual commitments totalling
£1,687,000 (31 March 2021: £1,738,000 and 30 September 2021: £405,000).
This is in relation to retentions for the capital works on Barnsley,
Prestatyn, Hull, Stirling and Haddington.
The Group did not have any other contractual commitments to refurbish,
construct or develop any investment property, or for repair, maintenance or
enhancements, as at 31 March 2022.
12. Fair Value Measurements
The fair value measurements for assets and liabilities are categorised into
different levels in the fair value hierarchy based on the inputs to valuation
techniques used. These different levels have been defined as follows:
• Level 1 - quoted prices (unadjusted) in active markets for identical
assets or liabilities that the Group can access at the measurement date.
• Level 2 - inputs, other than quoted prices included within Level 1
that are observable for the asset or liability, either directly or indirectly.
• Level 3 - unobservable inputs for the asset or liability. Value is the
Directors' best estimate, based on advice from relevant knowledgeable experts,
use of recognised valuation techniques and on assumptions as to what inputs
other market participants would apply in pricing the same or similar
instrument. All investment properties are included in Level 3.
There were no transfers between levels of the fair value hierarchy during the
six months ended 31 March 2022.
13. Interim Report Statement
The Company's auditor, Grant Thornton UK LLP, has not audited or reviewed the
Interim Report to 31 March 2022 pursuant to the Auditing Practices Board
guidance on 'Review of Interim Financial Information'. These are not full
statutory accounts in terms of Section 434 of the Companies Act 2006 and are
unaudited. Statutory accounts for the year ended 30 September 2021, which
received an unqualified audit report and which did not contain a statement
under Section 498 of the Companies Act 2006, have been lodged with the
Registrar of Companies. No full statutory accounts in respect of any period
after 30 September 2021 have been reported on by the Company's auditor or
delivered to the Registrar of Companies.
Shareholder Information
Corporate Summary
Ediston Property Investment Company plc (the Company) is a closed- ended
property investment company which began trading in October 2014. The Company
has a single class of Ordinary Shares in issue, which are listed on the
premium segment of the Official List and traded on the London Stock Exchange's
Main Market. The Company has two wholly owned subsidiary undertakings, EPIC
(No.1) Limited and EPIC (No.2) Limited (the Subsidiaries). The Company and the
Subsidiaries are referred to collectively throughout this document as 'the
Group', although references to the Company may also encompass matters relevant
to the Subsidiaries.
The Group has entered the Real Estate Investment Trust (REIT) regime for the
purposes of UK taxation. Further information for shareholders on the tax
structure and UK taxation of the Group's distributions is provided in the
Annual Report for the year ended 30 September 2021.
Investment Objective
The Company's investment objective is to provide shareholders with an
attractive level of income together with the prospect of income and capital
growth.
Investment policy
The Company's full investment policy is contained in the Directors' Report in
the Annual Report and Accounts for the year ended 30 September 2021.
INVESTMENT MANAGER AND AIFM
Ediston Investment Services Limited has been appointed as the Company's
alternative investment fund manager (AIFM) and investment manager and
therefore provides portfolio and risk management services, including ensuring
compliance with the Group's investment policy and the requirements of the
AIFMD, through the Management Agreement. Management services, including
advising on the acquisition, development, leasing, management and sale of the
Group's properties, are delegated to Ediston Properties Limited under the
Investment Manager's Delegation Agreement. Both agreements are subject to 12
months' notice, other than in a breach scenario.
Investor relations
Information on Ediston Property Investment Company plc, including the latest
share price can be found on the Company's website at www.ediston-reit.com
(http://www.ediston-reit.com/) .
Registrar
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 6ZZ
T: 0370 707 1079
E: www.investorcentre.co.uk/contactus
Enquiries about the following administrative matters should be addressed to
the Company's registrar:
- Change of address notification.
- Lost share certificates.
- Dividend payment enquiries.
- Dividend mandate instructions. Shareholders may have their dividends paid
directly into their bank or building society accounts by completing a dividend
mandate form. Tax vouchers, where applicable, are sent directly to
shareholders' registered addresses.
- Amalgamation of shareholdings. Shareholders who receive more than one copy
of the Annual/Interim Report are invited to amalgamate their accounts on the
share register.
Shareholders can view and manage their shareholdings online at
www.investorcentre.co.uk, including updating address records, making dividend
payment enquiries, updating dividend mandates and viewing the latest share
price. Shareholders will need their Shareholder Reference Number (SRN), which
can be found on their share certificate or a recent dividend tax voucher, to
access this site. Once signed up to Investor Centre, an activation code will
be sent to the shareholder's registered address to enable the shareholder to
manage their holding.
anticipated Financial Calendar 2021/22
July 2022 Announcement of Net Asset Value as at 30 June 2022
October 2022 Announcement of Net Asset Value as at 30 September 2022
December 2022 Publication of Annual Report for the year to 30 September 2022
January 2023 Announcement of Net Asset Value as at 31 December 2022
February 2023 Annual General Meeting
The Board will consider the calendar at each meeting and amend as appropriate.
The Company continues to pay monthly dividends.
Glossary of terms, definitions and alternative performance measures
The Company uses Alternative Performance Measures (APMs). APMs do not have a
standard meaning prescribed by accounting standards and therefore may not be
comparable to similar measures presented by other entities. The APMs used by
the Company are included below. A full glossary was included in the Annual
Report 2021 to assist investors in their understanding of the other technical
terms that the Company may use in reporting its results.
Contracted Rent The annualised rent adjusting for the inclusion of rent subject to rent-free
periods and rental guarantees.
Discount (or Premium) of Share Price to Net Asset Value If the share price is less than the Net Asset Value per share, the shares are
trading at a discount. If the share price is greater than the Net Asset Value
per share, the shares are trading at a premium. The discount (or premium) is
calculated by reporting the difference between the Net Asset Value per share
and the Share Price as a percentage of the Net Asset Value per share.
Dividend Cover Revenue profit for the period, excluding exceptional items, divided by
dividends paid during the period.
Dividend Yield Calculated using the annual dividend as a percentage of the share price at the
period end.
Earnings per share (EPS) Profit for the period attributable to ordinary equity holders of the Company
divided by the time weighted average number of ordinary shares outstanding
during the period. As there are no dilutive instruments outstanding, basic and
diluted earnings per share are identical.
EPRA NAV NAV adjusted to include properties and other investment interests at fair
value and to exclude certain items not expected to crystallise in a long-term
investment property business model. Makes adjustments to the IFRS NAV to
provide stakeholders with the most relevant information on the fair value of
the assets and liabilities within a true real estate investment company with a
long-term investment strategy. At 31 March 2022, 30 September 2021 and 31
March 2021, the EPRA NAV was the same as the IFRS NAV.
EPRA Net Asset Value (NAV) per Share EPRA NAV at the period end divided by the number of Ordinary Shares in issue
at that date.
EPRA Vacancy Rate Estimated Market Rental Value (ERV) of vacant space expressed as a percentage
of the ERV of the whole portfolio. The vacancy rate excludes those properties
which are under development or major refurbishment.
Gearing Unlike open-ended investment companies, closed-ended investment companies have
the ability to borrow to invest.
This term is used to describe the level of borrowings that an Investment
Company has undertaken. The higher the level of borrowings, the higher the
gearing ratio. This is expressed as a percentage of the principal value of
borrowings against total assets.
Like-for-like Movement The like-for-like increase (or decrease) in the property portfolio is
calculated as the movement in the fair value of the property portfolio
excluding any properties bought or sold in the period.
Loan-to-Value (LTV) Debt outstanding and drawn at the period end, net of any cash held in the
Lender deposit account, expressed as a percentage of the market value of all
property assets.
NAV per Ordinary Share (or IFRS NAV) This is calculated as the net assets of the Group calculated under its
accounting policies (as set out on pages 80 to 84 of the Annual Report 2021)
divided by the number of shares in issue, excluding those shares held in
treasury. This is the number disclosed at the foot of the Consolidated
Statement of Financial Position on page 8. At 31 March 2022 and 30 September
2021, the IFRS NAV was the same as the EPRA NAV.
NAV Total Return The growth in NAV plus dividends reinvested, and this can be expressed as a
percentage of NAV per share at the start of the period.
Share Price Total Return The percentage change in the Share Price assuming dividends are reinvested to
purchase additional Ordinary Shares at the prevailing share price.
WAULT (Weighted Average Unexpired Lease Term) The average lease term remaining to the earlier of break or expiry, across the
portfolio weighted by contracted rental income (including rent-frees). The
calculation excludes properties allocated as developments.
Capitalised terms above are as defined in the glossary included in the Annual
Report 2021.
HOW TO INVEST
Shares in Ediston Property Investment Company plc are listed on the main
market of the London Stock Exchange (LSE: EPIC).
As with any publicly quoted company, the Company's shares can be bought and
sold on the stock market. This can be done directly through a wealth manager,
financial adviser or stockbroker.
Another option is to use one of the platform providers who offer an 'execution
only' service. Links to such providers are available on the Company's website
at www.ediston-reit.com. Potential investors should note that by clicking on
any of the links contained thereon, you will leave the Company's website and
go to an external website. The Company is not responsible for the content or
accuracy of these external websites.
KEY INFORMATION DOCUMENT
Investors should be aware that the Packaged Retail and Insurance-based
Investment Products Regulation (PRIIPs) Regulation requires the AIFM, as the
PRIIP manufacturer, to prepare a key information document (KID) in respect of
the Company. This KID must be made available by the Investment Manager to
retail investors prior to them making any investment decision and is available
on the Company's website. The Company is not responsible for the information
contained in the KID and investors should note that the procedures for
calculating the risks, costs and potential returns are prescribed by the law.
The figures in the KID may not reflect the expected returns for the Company
and anticipated performance returns cannot be guaranteed.
Important Information
Past performance is not necessarily a guide to future performance. The value
of investments and income from them may go down as well as up and are not
guaranteed. NAV performance is not linked to share price performance and
shareholders may realise returns that are lower or higher in performance.
Certain statements in this report are forward-looking statements. By their
nature, forward-looking statements involve a number of risks, uncertainties or
assumptions that could cause actual results or events to differ materially
from those expressed or implied by those statements. Forward-looking
statements regarding past trends or activities should not be taken as
representation that such trends or activities will continue in the future.
Accordingly, undue reliance should not be placed on forward-looking
statements.
WARNING TO SHAREHOLDERS - BEWARE OF SHARE FRAUD
There has been an increase in the number of increasingly sophisticated but
fraudulent financial scams. This is often by a 'phone call or email which can
originate from outside the UK. Shareholders may receive unsolicited phone
calls or correspondence concerning investment matters that imply a connection
to the Company. These are typically from overseas 'brokers' who target UK
shareholders offering to sell them what often turn out to be worthless or
high-risk shares.
Shareholders may also be advised that there is 'an imminent offer for the
Company', and the caller may offer to buy shares at significantly above the
market price if an administration fee is paid. This is known as 'boiler room
fraud'.
If you are contacted, we recommend that you do not respond with any personal
information, including access to financial information or bank accounts. If
you are in any doubt you should seek financial advice before taking any
action.
You can find more information about investment scams at the Financial Conduct
Authority (FCA) website: www.fca.org.uk/consumer/protect-yourself-scams. You
can also call the FCA Consumer Helpline on 0800 111 6768.
In addition, please be aware that the COVID-19 pandemic may initiate new types
of scam activity and you can find out more information about this at
https://www.fca.org.uk/news/news-stories/avoid-coronavirus-scams.
CORPORATE INFORMATION
Directors Independent Auditor
Mr William Hill (Chairman) Grant Thornton UK LLP
Mr Robin Archibald 30 Finsbury Square
Mr Jamie Skinner London EC2P 2YU
Ms Imogen Moss
Registered office Tax Adviser
The Scalpel BDO LLP
18(th) Floor, 55 Baker Street
52 Lime Street London W1U 7EU
London EC3M 7AF
Registered number Registrar
09090446 Computershare Investor Services PLC
Registered in England and Wales The Pavilions
Bridgwater Road
Bristol BS13 8AE
AIFM Corporate Broker
Ediston Investment Services Limited Investec Bank PLC
Broadgate Tower 30 Gresham Street
20 Primrose Street London EC2V 7QP
London EC2A 2EW
Investment Manager Depositary
Ediston Properties Limited IQ EQ Depositary Company (UK) Limited
Broadgate Tower Two London Bridge
20 Primrose Street London SE1 9RA
London EC2A 2EW
Administrator and Company Secretary Public Relations
JTC UK Limited Kaso Legg Communications
The Scalpel 40 Queen Street
18(th) Floor, London EC4R 1DD
52 Lime Street
London EC3M 7AF
Legal Adviser Website
Dickson Minto W.S. www.ediston-reit.com
Broadgate Tower
20 Primrose Street
London EC2A 2EW
Property Valuer
Knight Frank LLP
55 Baker Street
London W1U 8AN
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