REG - NewRiver REIT plc - NewRiver REIT plc Q3 Company Update

Newriver ReitAnnouncement

20/01/2022 07:05

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RNS Number : 0177Z  NewRiver REIT PLC  20 January 2022

NewRiver REIT plc

("NewRiver" or the "Company")

Third Quarter Company Update

 

NewRiver is today providing an update in respect of its third quarter ended 31
December 2021.

·      Positive operational performance supported by improving consumer
backdrop, elevated leasing activity and increasing rent collection rates

·      Retail park investment market maintains growth trajectory and
shopping centres seeing improved demand; disposals completed in Q3 ahead of
book values

·      Strengthened balance sheet position and operational performance
recognised by Fitch Ratings through recently affirmed Investment Grade credit
ratings

 

Allan Lockhart, Chief Executive, commented: "We have continued to deliver
strong operational metrics in the third quarter, supported by a backdrop of
increasing consumer spend on essential items over the Christmas period.
Despite concerns of Omicron restrictions, our rent collection and leasing
activity remained robust. Disposals during the quarter were aligned with our
reshaping objectives and completed at strong prices which demonstrated the
significant value generated by our asset management and Regeneration activity.
As expected, liquidity continues to improve across the retail investment
market which offers further support for a stabilisation in asset values. The
affirmation of our Investment Grade Credit Rating demonstrates the progress we
have made this year in strengthening our balance sheet and positioning the
Company to deliver our 10% total accounting return target."

 

Positive operational performance supported by strong Q3 leasing activity

·      Strongest leasing quarter so far in FY22 in terms of volume and
rent secured; 289,000 sq ft of leasing activity, representing £2.5 million of
annualised rent

·      Q3 long term deals agreed on terms 8% ahead of valuers' ERV with
Core Shopping Centre deals on terms 20% ahead of ERV; long term leases agreed
in FY22 to date on average 10% ahead of ERV

·      High level of leasing activity has contributed to increased
occupancy of 96.3% (September 2021: 95.8%)

·      Average retail rent remains affordable at £11.66 per sq ft
(September 2021: £11.51 per sq ft)

 

Rent collection continues to increase as retailer confidence grows

·      Rent collection rates for every quarter continue to increase as
retailer trading improves

·      Q4 FY22 rent collection currently stands at 84%, ahead of
equivalent point for Q1-Q3 FY22 (on average 77%) and last year (Q4 FY21 was
70%)

·      Q1-Q3 FY22 rent collection improving and we are still collecting
rental arrears in respect of FY21 (cash collected rate up 4% since FY21
results to 90%)

 

Recent disposals completed ahead of book value; Work Out asset disposal
programme on track

·      £25.1 million of disposals completed during Q3 at a 5% premium
to September 2021 valuations; £32.7 million disposals completed in FY22 to
date

·      Completed disposals in Q3 include two Work Out Shopping Centres,
a segment we remain on track to exit by the end of FY23, a Regeneration
Shopping Centre in Penge (sold at 35% premium to March 2021 valuation) and
Poole Retail Park (held within our BRAVO capital partnership and sold at 7%
premium to latest valuation)

·      Disposals currently exchanged and under offer represent a further
£44.5 million, on average in-line with September 2021 valuations, taking
total disposals completed, exchanged or under offer to £77.2 million

·      Exchanged conditional contracts for disposal of Regeneration
Shopping Centre in Cowley, Oxford, for gross proceeds of £38.8 million
(including escrow); disposal expected to complete in the first quarter of 2022

·      Four further Work Out Shopping Centres either on the market or
undergoing preparation for sale

 

Strengthened balance sheet position recognised by Fitch Ratings and continued
progress on ESG

·      In October 2021 completed balance sheet transformation by
agreeing one-year extension on undrawn £125 million Revolving Credit Facility
('RCF') to August 2024

·      Weighted average debt maturity improved to 5.0 years as at 31
December 2021 and no maturity on drawn debt until March 2028

·      Strength of balance sheet position recognised in December 2021
when Fitch Ratings reaffirmed our Long-Term Issuer Default Rating (IDR) at
'BBB' with a Stable Outlook, senior unsecured rating (relating to £300
million unsecured 2028 bond) at 'BBB+' and Short-Term IDR at 'F2'

·    During the quarter we continued to make good progress on our ESG
objectives, improving our CDP score to a "B" from a "C" and achieving Gold
Level compliance with EPRA Sustainability Best Practice Recommendations

 

Cash rent collection by quarter

                               Q1   Q2   Q3   Q4
 As at 17 January 2022 (FY22)  90%  95%  94%  84%
 As at 15 January 2021 (FY21)  78%  83%  82%  70%

 

For further information

 

 NewRiver REIT plc                                   +44 (0)20 3328 5800
 Allan Lockhart (Chief Executive)

 Will Hobman (Chief Financial Officer)
 Emily Meara (Head of Investor Relations)

 

 Finsbury Glover Hering              +44 (0)20 7251 3801
 Gordon Simpson

 James Thompson

 

About NewRiver

 

NewRiver REIT plc ('NewRiver') is a leading Real Estate Investment Trust
specialising in buying, managing and developing essential retail and leisure
assets throughout the UK.

 

Our £0.7 billion portfolio covers 8 million sq ft and comprises 29 community
shopping centres and 17 conveniently located retail parks. We have hand-picked
our portfolio to focus on occupiers providing essential goods and services and
to support the development of thriving communities across the UK, while
deliberately avoiding structurally challenged sub-sectors such as department
stores and mid-market fashion. Our objective is to own and manage the most
resilient retail portfolio in the UK, focused on retail parks, core shopping
centres, and regeneration opportunities in order to deliver stable income and
capital growth to our investors.

 

NewRiver has a Premium Listing on the Main Market of the London Stock Exchange
(ticker: NRR). Visit www.nrr.co.uk for further information.

 

LEI Number: 2138004GX1VAUMH66L31

 

Forward-looking statements

 

The information in this announcement may include forward-looking statements,
which are based on current projections about future events. These
forward-looking statements reflect the directors' beliefs and expectations and
are subject to risks, uncertainties and assumptions about NewRiver REIT plc
(the 'Company'), including, amongst other things, the development of its
business, trends in its operating industry, returns on investment and future
capital expenditure and acquisitions, that could cause actual results and
performance to differ materially from any expected future results or
performance expressed or implied by the forward-looking statements.

None of the future projections, expectations, estimates or prospects in this
announcement should be taken as forecasts or promises nor should they be taken
as implying any indication, assurance or guarantee that the assumptions on
which such future projections, expectations, estimates or prospects have been
prepared are correct or exhaustive or, in the case of the assumptions, fully
stated in the document. As a result, you are cautioned not to place reliance
on such forward-looking statements as a prediction of actual results or
otherwise. The information and opinions contained in this announcement are
provided as at the date of this document and are subject to change without
notice. No one undertakes to update publicly or revise any such forward
looking statements. No statement in this document is or is intended to be a
profit forecast or profit estimate or to imply that the earnings of the
Company for the current or future financial years will necessarily match or
exceed the historical or published earnings of the Company.

 

 

 

 

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