REG - Real Estate Investrs - Final Results
22/03/2022 07:00
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RNS Number : 5160F Real Estate Investors PLC 22 March 2022
Real Estate Investors Plc
("REI" or the "Company" or the "Group")
Final Results
For the year ended 31 December 2021
Sales in Strong Investor Market
Real Estate Investors Plc (AIM: RLE), the UK's only Midlands-focused Real
Estate Investment Trust (REIT) with a portfolio of 1.5 million sq ft of
investment property, is pleased to report its final results for the year ended
31 December 2021.
Active year taking advantage of buyer demand before next phase of investment
· Delivered revenue of £16.0 million (FY 2020: £16.4 million)
allowing for disposals
· Profit before tax of £13.9 million (FY 2020: loss £20.2
million) including £4.9 million gain on property revaluations, £1.2 million
profit on sale of investment property and £1.4 million surplus on hedge
valuation
· Completed 15 disposals totalling £17.55 million (an aggregate
uplift of 7.3% before costs above December 2020 valuation) (£977,852 rental
income associated with these disposals)
o Disposal proceeds used to pay down £11.9 million of debt in 2021
o LTV (net of cash) reduced to 42.2% (FY 2020: 49.2%)
o £9.8 million cash at bank
o Average cost of debt of 3.5% with 90% of debt fixed (as at 1 January 2022)
· Renewed £51 million facility with NatWest for 3 years at 2.25%
above LIBOR in March 2021
· Underlying profit before tax* of £6.4 million (FY 2020: £8.1
million)
· EPRA EPS of 3.7p (FY 2020: 4.5p)
· EPRA Net Tangible Assets ("NTA") per share of 58.8p (FY 2020:
55.2p)
Increased Dividend
· Final dividend of 0.8125p per share, payable in April 2022 as a
Property Income Distribution (PID)
· Total fully covered dividend per share for 2021 of 3.0625p (FY 2020:
3p) up 2.08% and reflecting a yield of 7.90% based on a mid-market opening
price of 38.75p on 21 March 2022
· Total declared/paid to shareholders since commencement of
dividend policy of £41.9 million
Return to growth in Asset Values
· Like-for-like valuation increased by 2.7% to £188.5 million (FY
2020: £183.5 million)
· Gross property assets of £190.8 million (FY 2020: £201.3
million) with 256 occupiers/47 assets
· Near normal rent collection levels for 2021 of 97.81% (2020
Overall collection: 96.35%) and Q1 2022 rent collection to date 99.42%
(adjusted for monthly/deferred agreements)
· Completed 54 lease events during the period
· Improved WAULT to 5.03 years to break and 6.76 years to expiry
(FY 2020: 4.84 years /6.54 years)
· Contracted rental income of £14.3 million (FY 2020: £16.7
million) net of disposals
· Occupancy levels at 85.75%, further lettings should provide
additional valuation gains, as market place normalises post-COVID19
Post year end activity - Further opportunistic disposals combined with good
lettings pipeline
· £1.115 million disposals completed since year end at 12.6% above
2020 book value
· £7.5 million of sales in legals (above 2020 valuation levels)
driven by private investor demand
· Healthy pipeline of new lettings in legals of £159,000 p.a.
· Barclays £12 million facility extended by 12 months to 31
December 2024 in February 2022
Paul Bassi, CEO of Real Estate Investors Plc, commented:
"Despite the restrictions imposed by the pandemic, REI has had a respectable
year during which we have taken advantage of the private investor demand to
sell some of our properties, using the disposal proceeds to repay £11.9
million of debt, retain £9.8 million of cash and fix 90% of our debt at
attractive rates. This has delivered pre-tax profits of £13.9 million and an
increased fully covered dividend. We believe we are set to see further
valuation gains and occupancy improvement during 2022 and that this already
active regional market is likely to be further boosted by the upcoming 2022
Commonwealth Games."
Financial and Operational Results
31 Dec 2021 31 Dec 2020
Revenue £16 million £16.4 million
Underlying profit before tax £6.4 million £8.1 million
Contracted rental income £14.3 million £16.7 million
EPRA EPS** 3.7p 4.5p
Basic EPS 7.8p (11.5)p
Pre-tax Profit/(loss) £13.9 million (£20.2 million)
Dividend per share 3.0625p 3p
Average cost of debt 3.5% 3.4%
Like-for-like rental income £14.3 million £16.0 million
31 Dec 2021 31 Dec 2020
Gross property assets £190.8 million £201.3 million
EPRA NTA per share 58.8p 55.2p
Like-for-like capital value psf £126.58 psf £123.25 psf
Like-for-like valuation £188.5 million £183.5 million
Tenants 256 262
WAULT to break*** 5.03 years 4.84 years
Total ownership (sq ft) 1.5 million sq ft 1.59 million sq ft
Net assets £105 million £97.7 million
Loan to value 47.4% 51.3%
Loan to value net of cash 42.2% 49.2%
Definitions
* Underlying profit before tax excludes profit/loss on
revaluation and sale of properties and interest rate swaps
** EPRA = European Public Real Estate Association
*** WAULT = Weighted Average Unexpired Lease Term
Certain of the information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the UK version of
the EU Market Abuse Regulation (2014/596) which is part of UK law by virtue of
the European Union (Withdrawal) Act 2018, as amended and supplemented from
time to time.
Enquiries:
Real Estate Investors Plc
Paul Bassi/Marcus Daly +44 (0)121 212 3446
Cenkos Securities (Nominated Adviser) +44 (0)20 7397 8900
Katy Birkin/Ben Jeynes
Liberum (Broker) +44 (0)20 3100 2000
Jamie Richards/William King
Novella Communications +44 (0)20 3151 7008
Tim Robertson/Fergus Young
About Real Estate Investors Plc
Real Estate Investors Plc is a publicly quoted, internally managed property
investment company and REIT with a portfolio of 1.5 million sq ft of mixed-use
commercial property, managed by a highly-experienced property team with over
100 years of combined experience of operating in the Midlands property market
across all sectors. The Company's strategy is to invest in well located,
real estate assets in the established and proven markets across the Midlands,
with income and capital growth potential, realisable through active portfolio
management, refurbishment, change of use and lettings. The portfolio has no
material reliance on a single asset or occupier. On 1st January 2015, the
Company converted to a REIT. Real Estate Investment Trusts are listed
property investment companies or groups not liable to corporation tax on their
rental income or capital gains from their qualifying activities. The Company
aims to deliver capital growth and income enhancement from its assets,
supporting its progressive dividend policy. Further information on the
Company can be found at www.reiplc.com (http://www.reiplc.com/) .
Chairman's and Chief Executive's Statement
Despite COVID19 and the subsequent variants dominating the past 12 months for
many businesses, we are pleased to report a positive performance, resulting in
pre-tax profits of £13.9 million (FY 2020: loss of £20.2 million) which has
supported an increased fully-covered dividend payment of 3.0625p for the
period. A total of £41.9 million has been declared/paid to shareholders
since the commencement of our dividend payments in 2012.
This performance is underpinned by our high rent collection levels throughout
2021, with an overall collection level of 97.81%, against a backdrop of the
unfavourable government moratorium restrictions which are soon to expire.
For Q1 2022, rent collection levels are currently at 99.42%. These
collection levels are a testament to the diversity of our portfolio and the
asset management team who worked collaboratively with our portfolio tenants to
navigate a uniquely challenging period.
The first few months of 2022 have seen market recovery continue to gather pace
which has been improved further by the step-by-step ceasing of UK restrictions
and the return to normality that has been so eagerly awaited, led by the UK
regions who are now at near normal activity and ahead of London and the South
East.
Our portfolio, valued at £190.8 million (with 256 occupiers across 47 assets)
has weathered the COVID storm and we believe is well placed to benefit from
the ongoing revaluation and occupancy recovery. Private investors with high
levels of cash reserves continue to lead the interest in our assets. Many of
our properties are acquired on the basis of their significant break-up
potential to satisfy this demand, predominantly small retail units within
local neighbourhood and convenience schemes. With a healthy exposure to the
community retail market (39.07% of our portfolio) we successfully disposed of
a number of these sought-after assets, along with the remaining legacy
non-core stock, ending the period with sales totalling £17.55 million, at
7.3% above the December 2020 book value, demonstrating the underlying
portfolio value. We continue to consider further sales of assets for a
premium price.
As anticipated, disposals, along with the capital uplift gained from intensive
asset management is leading to some reversal in the valuation declines
experienced in December 2020, which were naturally cautious given we were in
the midst of the UK's third national lockdown. We are pleased to report a
2.7% recovery in our like-for-like portfolio valuations for the period, a
trend we expect to continue as the market normalises further and activity
returns to pre-pandemic levels and our occupancy improves.
Of the cash generated from portfolio disposals during 2021, £11.9 million was
used to repay debt and we capitalised on the low interest rate environment to
fix 90% of our borrowings, such that the average cost of debt is 3.5%. The
remaining cash from 2021 disposals is earmarked for opportunistic acquisitions
during 2022 to support the Company's next phase of growth. We did not
complete any acquisitions in 2021 and focused on sales and debt reduction, as
it remains very much a 'sellers' market.
Against the challenging backdrop of working from home initiatives and COVID19
variants, REI successfully completed 54 lease events in the year, resulting in
an improvement in our WAULT to 5.03 years to break and 6.76 years to expiry
(FY 2020: 4.84 years to break/6.54 years to expiry). Our contracted rental
income reduced to £14.3 million, reflecting disposals and the loss of income
associated with known lease events and new voids particularly in our office
portfolio. We anticipate improved lettings, that will boost contracted
rental levels in 2022 and support valuation gain.
Occupancy levels within the portfolio dipped in the final quarters of 2021 to
85.75% (FY 2020: 91.60%). We believe that this reduction is temporary and
reflective of the circumstances at the time, given that spaces which were due
to become void during the period (due to known lease events) and which would
let in a normalised marketplace, sat empty for longer whilst occupiers dwelled
on decisions and COVID19-related government guidance encouraged office workers
back to their homes, naturally leading to a pause in occupier decisions. A
significant volume of our void space within the portfolio is offices. Our
retail portfolio by comparison is 91.88% occupied.
We are optimistic that 2022 will see renewed interest in our available spaces
particularly our office portfolio. We are seeing the trend for non-City
centre offices continue and, of our office stock, 81.03% is non-City centre.
We will be focussed on unlocking the income sitting in our voids and the
multiple existing embedded opportunities across the portfolio (including
change of use, planning gains and lease re-gears) which would translate into
enhanced occupancy levels, increased contracted rental income and improved
WAULT. This activity, together with ongoing valuation recovery, should drive
capital and income growth across the portfolio and a rise in our NAV,
supporting our progressive dividend policy.
As our region gears itself up for this year's highly anticipated 2022
Commonwealth Games, we expect this 'once in a lifetime' event to further boost
the recovery we have already witnessed and attract yet more investment to our
thriving region.
Environmental, Social and Governance ("ESG")
Management recognises its responsibility to incorporate ESG into the daily
working practices at REI.
In March 2021, we outlined why and how we engage with our stakeholders and how
we intended to build on this going forward. We committed to expanding our
ESG reporting and working with relevant consultants to accurately capture,
measure and report ESG data. We explained that it was the Company's
intention to expand on our ESG reporting in our results for the year ending 31
December 2021. In line with this commitment, we report our progress as
follows:
ESG Committee
In 2021, a non-Board ESG Committee was formed, headed by Ian Stringer, a
non-Executive Director. The ESG Committee was formed with the purpose of
creating, implementing and reviewing the ESG framework for the business. The
Company's ESG Policy along with details of the ESG Committee members and our
ESG partners is available to view on our website at www.reiplc.com
(http://www.reiplc.com) . Our latest ESG Policy, dated February 2022
outlines the areas of focus for the business, within the scope of ESG.
ESG Partnership
REI is proud to announce its partnership with Measurabl, the world's most
widely adopted ESG technology and services platform for commercial real
estate. ESG data is now a leading performance indicator for commercial real
estate. With Measurabl's assistance, we will collect consumption data across
our portfolio in order to measure and comprehensively report carbon emissions.
Partnering with Measurabl gives us the ability to capture and store data in
one centralised digital platform, providing independent, accurate and
auditable ESG data. REI is dedicated to acting responsibly and undertaking
initiatives that lower carbon emissions across our portfolio and, as we
progress with Measurabl, identify further opportunities to support and expand
ESG reporting and improve outcomes across our portfolio.
Portfolio Scope 1 and Scope 2 Emissions (landlord-controlled areas
only/electricity and gas only)
Working with Measurabl, we have established the carbon emissions (Scope 1 and
Scope 2 emissions) for landlord-controlled areas only across the portfolio
(totalling 1.07 million sq ft) for the period 1(st) January 2019 to 31(st)
December 2019 (electricity and gas only).
In line with our ESG Policy, dated 18 February 2022, we will continue to
capture and report our emissions on an annual basis. We also commit to
expanding our data capture over time to include tenant consumption data (where
possible) for the purpose of analysing our Scope 3 (tenant controlled)
emissions (electricity & gas only).
We have detailed below our emissions for Jan - Dec 2019, a benchmark
pre-pandemic year:
Emissions (landlord-controlled areas only) 1 Jan 2019 - 31 Dec 2019
Scope 1 Emissions 17,574 MTCO2e
Scope 2 Emissions 1,236 MTCO2e
Total Scope 1 and Scope 2 Emissions 18,810 MTCO2e*
*applies to 1.07 million sq ft of the portfolio (landlord controlled areas)
As stated in our 2020 year-end results, the reduction of the portfolio's
carbon footprint is a priority for the business.
Portfolio Energy Performance Certification
In accordance with government guidelines, REI PLC has a programme to ensure we
meet the UK statutory time frame for EPCs. It remains our intention to
upgrade assets when required.
EPC Rating A B C D E F G Total
% of portfolio (by sq ft) 0.00% 9.48% 37.18% 43.15% 9.35% 0.54% 0.30% 100.00%
Financial Results
We have recorded pre-tax profits of £13.9 million (FY 2020: loss of £20.2
million), a result which is after a revaluation gain of £4.9 million (2.7%)
on our investment properties (FY 2020: reduction of £27.9 million), a surplus
of £1.2 million on sale of investment property (2020: £nil) and a rise in
the market value of our interest rate hedging instruments of £1.4 million (FY
2020: loss of £483,000).
Underlying profit for the year was £6.4 million (FY 2020: £8.1 million)
impacted primarily by a reduction in contracted rental income due to void
space within the portfolio and disposals during the period.
Our like-for-like rental income has reduced by 10.74% to £14.3 million,
predominantly due to known lease events that provide asset management
opportunities to improve rental income and lease terms and enhance capital
value.
The pre-tax profits of £13.9 million support our fully covered dividend for
2021 of 3.0625p per share.
Finance and Banking
In March 2021, the Group entered into a new NatWest facility of £51 million
for 3 years at 2.25% above LIBOR. The remainder of our debt is secured
across another 4 banks and we continue to enjoy longstanding banking
relationships that gives us access to debt at competitive rates.
Lender Debt Facility (£m) Debt Maturity Hedging (£m)
National Westminster Bank £41.7 March 2024 £35.0
Lloyds Banking Group £20.0 December 2023 £20.0
Aviva £14.2 2027,2030 & 2031 £14.2
Barclays £12.0 December 2024 £12.0
AIB GB £2.1 April 2022 nil
With a view to hedging against future interest rate rises, the Company took
advantage of the low interest rate environment in 2021 and fixed £35 million
of the NatWest facility, preserving our low average cost of debt. This took
effect from 1 January 2022 and our fixed debt ratio as at that date was 90%
with an average cost of debt of 3.5%. Our hedge facility has improved by
£1.4 million for the year to 31 December 2021 and has improved by a further
£497,000 since the period end. This all provides us with some protection
from the likelihood of further interest rate rises to manage very real
inflation.
Of the disposals during the period totalling £17.55 million, £11.9 million
of the proceeds were used to repay debt with the balance earmarked for future
acquisitions. This strategy, combined with a 2.7% gain in our like-for-like
portfolio valuations has led to a reduction in our LTV (net of cash) to 42.2%
(FY 2020: 49.2%) and is in line with management's objective to reduce Company
gearing levels to 40% LTV or below.
All banking covenants (which are a combination of both the measurement of LTV
against asset value and interest cover against rental income) continue to be
met with headroom available and various cure facilities in place.
Dividend
The Company's dividend payments continued throughout 2021 despite market
uncertainty, with the first three quarters paid at a level of 0.75p per share,
fully covered.
In light of the strong operational performance and in line with managements'
ongoing commitment to a progressive dividend policy, it has been deemed
appropriate to increase the final dividend in respect of 2021 to 0.8125p per
share, reflecting a total fully-covered dividend payment for 2021 of 3.0625p
Total fully covered dividend per share for 2021 of 3.0625p (FY 2020: 3p) up
2.08% and a yield of 7.90% based on a mid-market opening price of 38.75p on 21
March 2022. The Board remains committed to growing the dividend further, as
market conditions continue to normalise. The proposed timetable for the
final dividend, which will be a Property Income Distribution (PID), is as
follows:
Dividend Timetable
Ex-dividend date: 7 April 2022
Record date: 8 April 2022
Dividend payment date: 29 April 2022
Outlook for 2022
We will continue to take advantage of private investor demand. Capital from
disposals will be used for acquisitions that support portfolio growth and the
balance will be used to repay debt and further reduce gearing to levels in
line with management's parameters. We expect further valuation recovery and
intend to maximise gains and unlock income potential by focusing on void
letting opportunities and asset management initiatives across the portfolio.
We recognise the need for market consolidation within the real estate and REIT
market and remain alert to options that align with the interests of our
shareholders. Having successfully weathered the global pandemic and two
years of Brexit fiasco, we recognise the Russian invasion of Ukraine may well
have a negative impact on commercial activity generally in 2022 and beyond.
Investment Market Overview
National 2021 annual investment volumes (according to Colliers Research)
reached £60 billion, up from £47 billion in 2020 and 15% above the five-year
annual average. The £23 billion transacted during Q4 alone represents the
strongest quarterly figure on record.
Across the Midlands, annual investment volumes reached £6.4 billion in 2021,
up from £3.7bn in 2020 and almost 50% above the five-year average. Retail
investment volumes rose to £890 million in 2021 up from £710 million in 2020
but slightly below the five-year average. Office investment was subdued in
2021 with £330 million invested, down from £490 million in 2020.
In view of investors' access to relatively low-cost finance and high levels of
investor equity, there is good reason for optimism as these transactions will
provide the comparable evidence to support valuation recovery. Across the
region we are seeing limited availability of criteria-compliant investment
stock, as investors are holding onto income from property assets due to
outperformance as an asset class.
Industry experts believe that industrial values have peaked, with yields
across the region at 4.5% now widely considered to be expensive and investors
are shifting to alternative, higher yielding sectors such retail, retail
warehousing and offices that offer superior returns.
Meanwhile, private investors' appetite for investments under £1m has
continued to increase. It comes at a time where there is a lack of available
supply and we are capitalising on this by breaking up unbroken retail parades
to secure premium prices. Smaller investment sales are of more appeal to
private investors and we will capture this wherever possible to achieve
additional profits. More generally, we expect to see improved volume activity
throughout the year which will bring about yield compression for secondary
yields.
The REI Portfolio
-------The £190.8 million portfolio is comprised of 47 assets with 256
tenants with a net initial yield of 7.14% and a reversionary yield of 8.18%.
The like-for-like portfolio valuation has risen to £190.86 million (FY 2020:
£185.26 million) as a result of independent valuations and is in line with
our expectations. The rise was predominantly across our retail portfolio. We
anticipate further valuation gains during the course of 2022 due to improved
investment activity, as well as asset management initiatives and the letting
of void space within the portfolio.
The portfolio has reduced occupancy levels of 85.75% (FY 2020: 91.60%) with
unrealised capital value and rental income growth potential within our void
space. We anticipate successfully reletting these areas during the course of
2022. The reletting of our void space, combined with the acquisition of new
value-add opportunities is expected to drive occupancy and valuations back
towards pre-pandemic levels.
Disposals
Stock selection is a key element of effective property portfolio management in
order to achieve investment objectives. This occasionally entails selling
properties to balance the portfolio. During the year, we identified a number
of investments for disposal that were significantly ahead of valuation or that
no longer fit within the Company's investment strategy. In 2021 we
successfully disposed of 15 assets totalling £17.55 million, achieving strong
returns as we capitalised on private investor demand in the market. The
sales were achieved at an aggregate uplift of 7.3% (before costs) above
December 2020 valuations. The capital generated from sales completed in 2021
was partially used for debt repayment and the balance is set aside for new
acquisitions in the coming months.
The Company sold the following properties during the period:
· 54/56 High Street, Bromsgrove
· Citygate House, Leicester
· 82 High Street, Gillingham
· 14-14 High Street, Ringwood
· 3 Hanover Buildings, Southampton
· 33 Bennetts Hill, Birmingham
· 4-16 Brook Square, Rugeley
· 315-317 & 319 High Street, West Bromwich
· 23 Market Street, Leigh
· 25-25a Institute Road, Swanage
· St Austell House, Ilfracombe
· Bearwood Road Shopping Centre
· 124-125 Osbourne Road, Pontypool
· Land at Coseley
· Land at Brandon Court
The associated rental reduction from the total disposal consideration of
£17.55 million is £977,852 per annum, providing an overall market yield on
combined sales of 4.75%, assuming usual purchasers costs.
Post Period End Disposals
Since 31 December 2021, a further £1.115 million of asset disposals have
completed:
· 571 Bearwood High Street, Birmingham
· 31 High Street, Eastleigh
· 1-2 Hanover Buildings, Southampton
As we approach the end of Q1 2022, we currently have a further £7.5 million
of sales in pipeline legals (above 2020 valuation levels) driven by demand
from private investors.
We will continue to make opportunistic sales, where appropriate, to achieve
maximum gain where they have reached their potential and where we have
exhausted asset management initiatives.
This will also include assets that we believe will present a challenge from a
sustainability perspective, as we continue our commitment to owning assets
that positively impact the environment and contribute to our goal of lowering
our carbon emissions across the portfolio.
Occupational Market Overview
The Birmingham office market delivered a strong year in spite of continuing
challenges. Occupation transactions were almost double that of 2020, and
the total square footage was 26% higher. Central Birmingham offices saw eight
transactions over 25,000 sq ft. We expect this to continue into 2022 and
believe that the Midland's regional office markets remain undersupplied with
Grade A offices as the market returns to normality.
The rise in working remotely is not restricted to working from home but has
also resulted in an increase in working from regional satellite offices. We
believe that there is rental growth potential in many regional office markets
where supply has been diminished. Business Park Locations that offer an
attractive environment to both live and work locally and that boast buildings
with high environmental standards and accessibility to a skilled workforce,
will be in much demand.
Hotels and Leisure had a strong year throughout 2021, with investor optimism
underlined by an impressive £4 billion of UK hotel transactions. Increased
hotel demand, continued progress on profitability and improved visibility have
all contributed to the momentum.
Market pricing and valuations in the retail warehouse sector are recovering
strongly, with occupiers in discounting, DIY, homewares and food trading well.
We expect that well-located retail warehouse units let off recently rebased
lower rents will continue to be in demand. The importance of convenience as
well as the relatively low cost compared to the high street is likely to
support occupational demand.
Investors are increasingly confident that rental levels have bottomed out and
pricing for assets has moved noticeably. However, there is still potential
value in assets that incorporate leisure experiences, or where consumers
prefer to try before they buy such as furniture and homewares. Meanwhile
retail repurposing continues to gather pace, as the sector manages oversupply
in the market, leaving a shortage of good quality retail, which we anticipate
will lead to rental growth in the medium term.
Acquisitions
In a sellers' market we did not complete any acquisitions in 2021 and focused
on sales and debt reduction and restructure. We continue to seek new
investments and have retained close contact with investment market activity
through our well-established network of contacts. However, availability of
stock throughout the year was restricted and vendor expectations were
unrealistic.
We are seeking off-market medium sized acquisitions (above private investor
market) that offer stronger returns with prospects for income/capital value
improvement.
Portfolio Mix
The current sector weightings are:
Sector £ per annum % by Income
Office Office 4,815,756 33.61
TR Traditional Retail 2,665,694 18.61
DR Discount Retail - Poundland/B&M etc 1,801,350 12.57
M&P Medical & Pharmaceutical - Boots/Holland & Barrett etc 1,143,999 7.99
RBC Restaurant/Bar/Coffee - Costa Coffee, Loungers etc 1,026,900 7.17
FIN Financial/Licences/Agency - Lloyds TSB, Santander UK Plc, Bank of Scotland etc 546,000 3.81
FS Food Stores - M&S, Aldi, Co-op, Iceland etc 585,690 4.09
Other Other - Hotels (Vine Hotels/Travelodge), Leisure (The Gym Group, Luda Bingo), 1,740,264 12.15
Car parking, AST
14,325,653 100.00
Asset Management
Our £190.8 million portfolio of regional property has proved resilient during
economic crises, market downturns and global pandemics, not least due to its
sector and tenant diversity.
As the light at the end of the pandemic tunnel begins to brighten, we closed
2021 with robust overall rent collection levels of 97.81%.
2021 was very much a year of two halves; with the start of the year seeing the
legacy of 2020 continue with a subdued lettings market. The second half of
the year saw occupier demand slowly increase with a return towards the end of
the year of pre-pandemic interest in our portfolio spaces dampened slightly by
the 'work from home' guidance and the spread of Omicron in the final weeks of
2021.
A significant number of lease events took place in 2021 (54 in total)
improving our WAULT to 5.03 years to break and 6.76 years to expiry (FY 2020:
4.84 years to break/6.54 years to expiry), as at 31 December 2021.
Whilst the high levels of asset management activity drove an increase in our
WAULT, our occupancy levels reduced to 85.75% (FY 2020: 91.60%) due to sales
and known lease expiries during the period.
Key asset management initiatives undertaken during the period include:
West Plaza, West Bromwich
Despite the overall downturn in the global hotel market, following a
competitive bidding exercise at West Plaza (the former Premier Inn) Vine
Hotels signed up to a 15-year lease over six floors, at a rental level above
independent valuer ERV. This represents almost two thirds of the building
and the remainder is fully occupied.
Titan House, Telford
2021 saw the refurbishment of two floors along with the associated common
areas. Titan House was formally let to HP Enterprise Services in its
entirety and upon contractual lease expiry plans were subsequently drawn up to
significantly improve the office accommodation along with the ESG credentials
of the building.
In May 2021 the Department of Workplace and Pensions took a lease on the whole
of the ground floor and upgraded the space to their own specification. Once
completed, REI instigated refurbishments to the first and second floors,
common areas (stair core and WC lobbies) to all floors, reception and the WCs
(first and second floors only). The office accommodation was stripped out and
taken back to a shell and core condition.
This included the replacement of the M&E system with new energy efficient
equipment, as well the replacement of the office lighting with new LED
fittings, coupled with infrared sensors further reducing energy usage.
Pre-refurbishment, the EPC rating for the property was a D (76) and it is
projected that upon completion of the works, a higher EPC rating will be
achieved. As well as improving the quality of space we have achieved an ERV
increase from £10 per sq ft to £12 per sq ft, and once re-let the uplift in
property valuation will comfortably exceed the capital expenditure for the
refurbishment.
Brandon Court, Coventry
When a neighbouring unit became vacant, REI worked closely with an existing
tenant to explore opportunities to allow them to expand their operation.
This resulted in the tenant taking additional space and extending and
combining two units into one longer term lease, allowing the tenant the
ability to consolidate and grow its operation from the site, adding value to
the asset with limited void period.
In addition, a surrender was agreed with a tenant that was withdrawing from
the UK market. The large unit was separated into two units and
refurbished. Both units were let at market rents on strong terms, post
period end.
Jasper Square, Tunstall
Poundland renewed its lease for a further 5 years from February 2022.
Poundland have been occupying the property by way of short term contracted
lease from August 2020 and traded throughout the Covid 19 pandemic. The
renewal demonstrates their ongoing confidence in the retail park and the
agreed rent of £130,000 p.a. helps REI to enforce our ERV throughout the rest
of the parade.
New tenants to the portfolio in 2021
New tenants include The Trustees of Association of School and College
Leaders; Vine Hotels; Merkur Slots UK Limited; JD Sports Gyms Limited; Comex
2000; Bennetts Motorcycling Services Limited; Community Health and Eyecare
Limited; YMCA; Secretary of State for Housing, Communities and Local
Government.
Post Period End Activity and Sentiment
Lease activity across the portfolio has increased in the first quarter of
2022; with notable lease events at Tunstall, Southgate Retail Park and Brandon
Court. Strong interest in units previously empty in community retail parades
such as Acocks Green reinforces the market sentiment for local and convenience
retail.
We have negotiated terms on a space that has been void for some time in
Redditch (£30,000 p.a., 15-year lease with breaks at years 5 and 10, with 6
months rent-free) at £6,400 p.a over ERV, supporting our prediction that the
market is normalising and rent levels are increasing. We currently have a
healthy pipeline of new lettings in legals of £159,000 p.a.
Our priority in 2022 remains to operate a sustainable portfolio with an ESG
policy embedded within our asset management strategy. Additionally, we
remain committed to ensuring that we explore initiatives that provide value to
our shareholders.
Embedded Opportunities
As mentioned in our January 2022 trading update, demand for fast food/drive
thru locations significantly rose during the pandemic and is expected to
continue. In response to this trend, we have identified suitable unoccupied
sites/redundant land and are negotiating competitive terms to strong covenants
in this space.
Portfolio Summary
Value (£) Area (sq ft) Contracted Rent (£) ERV (£) NIY (%) RY (%) Occupancy
Central Birmingham 23,960,000 101,477 1,336,102 1,838,210 5.22% 7.19% 76.33%
Other Birmingham 25,970,000 186,998 2,326,336 2,127,435 8.41% 7.69% 94.70%
West Midlands 71,875,000 636,671 5,330,568 6,339,931 6.96% 8.28% 82.59%
Other Midlands 65,945,000 558,924 5,253,645 5,941,780 7.47% 8.45% 87.92%
Other Locations 735,000 5,013 79,000 59,500 10.31% 7.77% 100.00%
Land* 2,384,000 - - - - - -
Total 190,869,000 1,489,083 14,325,651 16,306,856 7.13% 8.12% 85.75%
*Our land holdings are excluded from the yield calculations
Our Stakeholders
Our ongoing thanks to our shareholders, advisors, tenants and staff for their
invaluable support and assistance during the pandemic.
Chairman's Succession
In May 2021 John Crabtree OBE retired as Non-Executive Chairman of the Company
at the Annual General Meeting ('AGM'). William Wyatt, Non-Executive Director
of the Company since 2010, was appointed as Chairman, with effect from the AGM
in 2021. This appointment is the result of our Board succession planning, an
ongoing process which identifies necessary competencies and works to assess
what would be required to ensure a continuation of leadership in all
circumstances.
William
Wyatt
Paul Bassi CBE D. Univ
Chairman
Chief Executive
21 March
2022
21 March 2022
FINANCIAL REVIEW
Overview
Our results for 2021 are in line with management's expectations. Whilst the
COVID-19 pandemic dominated much of 2021, our diversified and resilient
portfolio, delivered high rent collection levels of 97.81%.
During the period we recorded pre-tax profits of £13.9 million (FY 2020: loss
of £20.2 million), including a gain of £4.9 million (2.7%) on our investment
properties (FY 2020: reduction of £27.9 million), a surplus of £1.2 million
on sale of investment property (2020: £nil) and a rise in the market value of
our interest rate hedging instruments of £1.4 million (FY 2020: loss of
£483,000).
We disposed of £17.55 million of assets during the period and used £11.9
million of the disposal proceeds to repay debt. This debt repayment,
combined with the gain in portfolio valuations has led to a reduction in our
LTV (net of cash) to 42.2% (2020: 49.2%). As a result, our EPRA NTA per
share has risen by 6.5% to 58.8p (2020: 55.2p).
In March 2021 we refinanced our £51 million facility with National
Westminster Bank PLC for 3 years at 2.25% above LIBOR, taking our average cost
of debt to 3.5%. During the period we successfully fixed £35 million of
this facility and as at 1 January 2022 90% of our debt was fixed. In addition,
in February 2022 we extended the term of our £12 miilion facility with
Barclays by 12 months to December 2024. AIB GB are withdrawing from the retail
banking market and so we will repay the balance of £2.1 million on our
facility in Q2 this year. We continue to meet the requirements of our
banking covenants (which are measured against LTV of the loans to property
values and the interest cover against rental income) and have headroom
available and cure facilities in place.
Despite a drop in our like-for-like rental income to £14.3 million (impacted
by an increase in void space across the portfolio due to COVID19-related
delays in occupier decisions, combined with disposals during the period) the
Group delivered revenue of £16.0 million (2020: £16.4 million). Our
underlying profit for the year was £6.4 million (2020: £8.1 million).
Following the Board's decision in 2020 to continue with dividend payments to
shareholders despite the pandemic, the Board increased the quarterly dividend
payments in respect of 2021 to 0.75p per share for Q1, Q2 and Q3. The final
dividend for 2021 has been declared at 0.8125p and is fully covered,
representing a total covered dividend for 2021 of 3.0625p (2020: 3p), this has
been supported by our pre-tax profits of £13.9 million.
Our share price has yet to recover fully from the impact of COVID19 and
continues to trade at a significant discount to NAV.
31 December 2021 31 December 2020
Gross Property Assets £190.8 million £201.3 million
Underlying profit before tax £6.4 million £8.1 million
Profit/(loss) before tax £13.9 million (£20.2) million
Revenue £16 million £16.4 million
EPRA EPS 3.7p 4.5p
EPRA NTA per share 58.8p 55.2p
Net Assets £105 million £97.7 million
Loan to value 47.4% 51.3%
Loan to value net of cash 42.2% 49.2%
Average cost of debt 3.5% 3.4%
Dividend per share 3.0625p 3p
Like-for-like rental income £14.3 million £16.0 million
Like-for-like capital value per sq ft £126.58 psf £123.25 psf
Like-for-like valuation £188.5 million £183.5 million
Results for the year
Pre-tax profits during the period recorded of £13.9 million (2020: £20.2
million loss), following a revaluation gain of £4.9 million on investment
properties (2020: £27.9 million reduction), a surplus of £1.2 million on
sale of investment property (2020: £nil) and a rise in the market value of
our interest rate hedging instruments of £1.4 million (2020: loss of
£483,000). Exluding these items, the underlying profits reduced to £6.4
million (FY 2020: £8.1 million).
Revenues for the year were down to £16 million (2020: £16.4 million) as a
result of a decrease in rental income of £1.8 million due to sales and leases
coming to an end, particularly in Oldbury and Kingston House, but offset by
the sale of land in Coseley.
We did not make any investment property acquisitions during the period. As
at 31 December 2021, cash at bank of £9.8 million is earmarked for future
capital and income growth supporting acquisitions.
We continue to closely monitor our overhead base and administrative expenses
have reduced during the period by £200,000 to £3.1 million (2020: £3.3
million), mainly as a result of a reduction of the provision for bad debts to
£50,000 (2020: £825,000), providing for bonuses (plus employers' National
Insurance) of £260,000 (2020: £55,000) and a provision for costs of the
Long-Term Investment Plan of £150,000 (2020: credit £250,000). The
Remuneration Committee agreed that bonuses for the Executive Directors of
£180,000, being 25% of salary for 2021 should be made, (2020: nil). Direct
costs during the period rose by £500,000 due to the increased holding costs
of void space across the portfolio.
Interest costs for the year reduced by £400,000 to £3.2 million (2020: £3.6
million) due to £11.9 million debt repayment during the period. The weighted
average cost of debt rose slightly to 3.5% (2020: 3.4%) as a result of the
Group fixing £35 million of the facility with NatWest to hedge against future
interest rate rises.
Earnings per share were:
Basic: 7.8p (2020: loss 11.5p)
Diluted: 7.6p (2020: loss
11.5p)
EPRA: 3.7p (2020: 4.5p)
Shareholders' funds increased to £105 million at 31 December 2021 (2020:
£97.7 million) as a result of the gain on property portfolio revaluation.
Basic NAV: 58.5p (2020: 54.5p)
EPRA NTA: 58.8p (2020: 55.2p)
Finance and banking
Total drawn debt at 31 December 2021 was £89 million (2020: £101 million).
In March 2021, the Group renewed the £51 million facility with National
Westminster Bank PLC for 3 years at 2.25% above LIBOR. In February 2022 the
Group extended the £12 million facility with Barclays Bank PLC by a further
12 months to December 2024. The Group remains multi-banked across 5 lenders
and continues to meet banking covenants with its lenders. The Company took
advantage of the low interest rate environment in 2021 and fixed £35 million
of the NatWest facility, preserving low average costs of debt at 3.5% and
leading to 90% of the debt across the portfolio being fixed as at 1 January
2022.
Of the asset disposals completed during the period totalling £17.55 million,
£11.9 million of the proceeds were used for debt repayment, as at 31 December
2021 the weighted average debt maturity was 1.8 years (2020: 2.25 years).
The loan to value (LTV) as at 31 December 2021 was 47.4% (2020: 51.3%) and the
LTV (net of cash) was 42.2% (2020: 49.2%). The Group's hedge facility
improved by £1.4 million for the year to 31 December 2021 and has improved by
a further £497,000 since the period end.
Long Term Incentive Plan (LTIP)
The LTIP is designed to promote retention and to incentivise the executive
directors to grow the value of the Group and to maximise returns. Based on the
results for the year, 15% of the options awarded for 2019 are likely to vest
and so a charge to the provision of £150,000 (2020: £250,000 release) has
been made in the accounts in respect of the LTIP.
Taxation
The Group converted to a Real Estate Investment Trust (REIT) on 1 January
2015. Under REIT status the Group does not pay tax on its rental income
profits or on gains from the sale of investment properties. The tax charge for
the year is in respect of bank interest received and the movement on the
deferred tax asset is in respect of the financial instruments. The Group
continues to meet all of the REIT requirements to maintain REIT status.
Dividend
Under the REIT status the Group is required to distribute at least 90% of
rental income taxable profits arising each financial year by way of a Property
Income Distribution. REI commenced paying quarterly dividends in 2016.
Following a reduction in dividend payments in 2020 as a direct result of the
pandemic, the Board paid the first three quarters of 2021 at a level of 0.75p
per share and these were paid in July 2021, October 2021 and January 2022.
The Board proposes a final dividend of 0.8125p per share payable in April 2022
as a Property Income Distribution making a total of 3.0625p for the year
(2020: 3p) Total fully covered dividend per share for 2021 of 3.0625p (FY
2020: 3p) up 2.08%, reflecting a yield of 7.90% based on a mid-market opening
price of 38.75p on 21 March 2022. The Board remains committed to growing the
dividend further, as market conditions normalise.
Marcus Daly, Finance Director
21 March 2022
Real Estate Investors plc
Consolidated statement of comprehensive income
For the year ended 31 December 2021
Note 2021 2020
£000 £000
Revenue 15,971 16,425
Cost of sales (3,329) (1,397)
Gross profit 12,642 15,028
Administrative expenses (3,045) (3,262)
Surplus on sale of investment property 1,177 -
Change in fair value of investment properties 4,951 (27,896)
Profit/(loss) from operations 15,725 (16,130)
Finance income 46 14
Finance costs (3,235) (3,637)
Profit/(loss) on financial liabilities at fair value through profit and loss 1,388 (483)
Profit/(loss) on ordinary activities before taxation 13,924 (20,236)
Income tax charge - (405)
Net profit/(loss) after taxation and total comprehensive income 13,924 (20,641)
Total and continuing earnings/(loss) per ordinary share
Basic 3 7.76p (11.51)p
Diluted 3 7.64p (11.51)p
EPRA 3 3.67p 4.54p
The results of the Group for the period related entirely to continuing
operations.
Real Estate Investors plc
Consolidated statement of changes in equity
For the year ended 31 December 2021
Share Share Capital Other reserve Retained Total
capital premium redemption earnings
account reserve
£000 £000 £000 £000 £000 £000
At 1 January 2020 18,642 51,721 45 1,102 53,933 125,443
Share based payment - - - (493) - (493)
Share buy back (704) - - - (1,306) (2,010)
Transfer re capital - - 704 - (704) -
Dividends - - - - (4,625) (4,625)
Transactions with owners (704) - 704 493 (6,635) (7,128)
Loss for the year and total comprehensive income - - - - (20,641) (20,641)
At 31 December 2020 17,938 51,721 749 609 26,657 97,674
Share based payment - - - 150 - 150
Dividends - - - - (6,726) (6,726)
Transactions with owners - - - 150 (6,726) (6,576))
Profit for the year and total comprehensive income - - - 13,924 13,924
-
At 31 December 2021 17,938 51,721 749 759 33,855 105,022
Real Estate Investors plc
Consolidated statement of financial position
At 31 December 2021
Note 2021 2020
£000 £000
Assets
Non-current
Intangible assets - -
Investment properties 4 188,485 197,520
Property, plant and equipment 4 5
Deferred tax - -
188,489 197,525
Current
Inventories 2,384 3,796
Trade and other receivables 3,588 4,340
Cash and cash equivalents 9,836 4,238
15,808 12,374
Total assets 204,297 209,899
Liabilities
Current
Bank loans (2,479) (45,579)
Trade and other (7,685) (7,337)
payables
(10,164) (52,916)
Non-current
Bank loans (86,965) (55,775)
Derivative financial liabilities (2,146) (3,534)
(89,111) (59,309)
Total liabilities (99,275) (112,225)
Net assets 105,022 97,674
Equity
Share capital 17,938 17,938
Share premium account 51,721 51,721
Capital redemption reserve 749 749
Other reserve 759 609
Retained earnings 33,855 26,657
Total Equity 105,022 97,674
Net assets per share 54.5p
58.5p
Real Estate Investors plc
Consolidated statement of cash flows
For the year ended 31 December 2021
2021 2020
£000 £000
Cash flows from operating activities
Profit/(loss) after taxation 13,924 (20,641)
Adjustments for:
Depreciation 2 3
Net (surplus)/deficit on valuation of investment property (4,951) 27,896
Surplus on sale of investment property (1,177) -
Share based payment 150 (250)
Finance income (46) (14)
Finance costs 3,235 3,637
(Profit)/loss on financial liabilities at fair value through profit and loss (1,388) 483
Income tax charge - 405
Decrease/(increase) in inventories 1,412 (16)
Decrease/(increase) in trade and other receivables 752 (1,917)
(Decrease)/increase in trade and other payables (100) 74
Net cash from operating activities 11,813 9,660
Cash flows from investing activities
Expenditure on investment properties (955) (341)
Purchase of property, plant and equipment (2) -
Proceeds from sale of investment properties 16,119 -
Interest received 46 14
15,208 (327)
Cash flows from financing activities
Interest paid (3,235) (3,637)
Share based payment - (243)
Share buy back - (2,010)
Equity dividends paid (6,278) (5,476))
Proceeds from new bank loans - 3,500
Payment of bank loans (11,910) (7,321)
(21,423) (15,187)
Net increase/(decrease) in cash and cash equivalents 5,598 (5,854)
Cash, cash equivalents and bank overdrafts at beginning of period 4,238 10,092
Cash, cash equivalents and bank overdrafts at end of period 9,836 4,238
NOTES:
Cash and cash equivalents consist of cash in hand and balances with banks
only.
Real Estate Investors plc
Notes to the preliminary announcement
For the year ended 31 December 2021
1. Basis of preparation
The consolidated financial statements have been prepared under the historical
cost convention, except for the revaluation of properties and financial
instruments held at fair value through the profit and loss account, and in
accordance with International Financial Reporting Standards (IFRS) adopted by
the European Union.
It should be noted that accounting estimates and assumptions are used in
preparation of the financial statements. Although these estimates are based
on management's best knowledge and judgement of current events and actions,
actual results may differ from those estimates. The areas involving a higher
degree of judgement or complexity, or areas where assumptions and estimates
are significant to the financial statements, are set out in the Group's annual
report and financial statements.
The consolidated financial statements incorporate the financial statements of
the Company and its subsidiaries made up to 31 December each year. Material
intra-group balances and transactions, and any unrealised gains arising from
intra-group transactions, are eliminated on consolidation. Unrealised losses
are also eliminated unless the transaction provides evidence of an impairment
of the asset transferred.
The principal accounting policies are detailed in the Group's annual report
and financial statements.
Going concern
The Group has prepared and reviewed forecasts and made appropriate enquiries
which indicate that the Group has adequate resources to continue in
operational existence for the foreseeable future being a period of not less
than 12 months from the date of approval of these financial statements.
These enquiries considered the following:
· the significant cash balances the Group holds and the low levels
of historic and projected operating cashflows
· any property purchases will only be completed if cash resources
or loans are available to complete those purchases
· the Group's bankers have indicated their continuing support for
the Group. The Group's £51 million facility with National Westminster Bank
PLC was renewed for three years in March 2021 and the £12 million facility
with Barclays Bank PLC was extended by a further 12 months to December 2024 in
February 2022
· management have performed various sensitivities which
demonostrate that the Group has sufficient cash resources to continue in
operational existence for the foreseeable future
· the Directors have at the time of approving these financial
statements, a reasonable expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future being a period of
not less than 12 months from the date of approval of these financial
statements.
For these reasons, the Directors continue to adopt the going concern basis in
preparing the financial statements.
2. Gross profit
2021 2020
£000 £000
Revenue - Rental income 13,934 15,691
- Sale of inventory property 1,225
- Surrender premiums 812 734
15,971 16,425
Cost of sales - Direct costs (1,932) (1,397)
- Cost of inventory stock (1,397)
12,642 15,028
3. Earnings per share
The calculation of earnings per share is based on the result for the year
after tax and on the weighted average number of shares in issue during the
year.
Reconciliations of the earnings and the weighted average numbers of shares
used in the calculations are set out below.
2021 2020
Earnings Average Earnings per Average Earnings
number of Share Earnings number of per share
shares shares
£000 £000
Basic earnings/(loss) per share 13,924 179,377,898 (20,641) 179,377,898 (11.51)p
7.76p
Diluted earnings/(loss) per share 13,924 182,261,263 7.64p (20,641) 183,369,382 (11.51)p
The European Public Real Estate Association indices below have been included
in the financial statements to allow more effective comparisons to be drawn
between the Group and other business in the real estate sector.
EPRA EPS per share
2021 2020
Earnings Shares Earnings per Shares Earnings
Share Earnings per share
£000 No p £000 No P
Basic earnings/(loss) per share 13,924 179,377,898 7.76 (20,641) 179,377,898 (11.51)
Net (profit)/loss on valuation of investment properties (4,951) 27,896
Surplus on disposal of investment properties (1,177) -
Loss on sale of inventory properties 172 -
Change in fair value of derivatives (1,388) 483
Deferred tax - 405
EPRA earnings per share 6,580 179,377,898 3.67 8,143 179,377,898 4.54
NET ASSET VALUE PER SHARE
The Group has adopted the new EPRA NAV measures which came into effect for
accounting periods starting 1 January 2020. EPRA issued new best practice
recommendations (BPR) for financial guidelines on its definitions of NAV
measures. The new NAV measures as outlined in the BPR are EPRA net tangible
assets (NTA), EPRA net reinvestment value (NRV) and EPRA net disposal value
(NDV).
The Group considered EPRA Net Tangible Assets (NTA) to be the most relevant
NAV measure for the Group and we are now reporting this as our primary NAV
measure, replacing our previously reported EPRA NAV and EPRA NNNAV per share
metrics. EPRA NTA excludes the intangible assets and the cumulative fair value
adjustments for debt-related derivatives which are unlikely to be realised.
31 December 2021
EPRA NTA EPRA NRV
EPRA NDV
£'000 £'000 £'000
Net assets 105,022 105,022 105,022
Fair value of derivatives 2,146 2,146 -
Real estate transfer tax - 13,127 -
EPRA NAV 107,168 120,295 105,022
Number of ordinary shares issued for diluted and EPRA net assets per share 182,261,263 182,261,263 182,261,263
EPRA NAV per share 58.8p 66.0p 57.6p
The adjustments made to get to the EPRA NAV measures above are as follows:
• Real estate transfer tax: Gross value of property portfolio as provided in
the Valuation Certificate (i.e. the value prior to any deduction of
purchasers' costs).
• Fair value of derivatives: Exclude fair value financial instruments that
are used for hedging purposes where the company has the intention of keeping
the hedge position until the end of the contractual duration.
31 December 2020
EPRA NTA EPRA NRV
EPRA NDV
£'000 £'000 £'000
Net assets 97,674 97,674 97,674
Fair value of derivatives 3,534 3,534 -
Real estate transfer tax - 12,623 -
EPRA NAV 101,208 113,831 97,674
Number of ordinary shares issued for diluted and EPRA net assets per share 183,369,382 183,369,382 183,369,382
EPRA NAV per share 55.2p 62.1p 53.3p
31 December 2021 31 December 2020
No of Shares No of Shares
Number of ordinary shares issued at end of period 179,377,898 179,377,898
Dilutive impact of options 3,991,484
2,883,365
Number of ordinary shares issued for diluted and EPRA net assets per share
182,261,263 183,369,382
Net assets per ordinary share
Basic 58.8p 55.2p
Diluted 66.0p 62.1p
EPRA NTA 57.6p 53.3p
4. Investment properties
Investment properties are those held to earn rentals and for capital
appreciation.
The carrying amount of investment properties for the periods presented in the
consolidated financial statements is reconciled as follows:
£000
Carrying amount at 1 January 2020 225,075
Additions - subsequent expenditure 341
Change in fair value (27,896)
Carrying amount at 31 December 2020 197,520
Additions - subsequent expenditure 955
Disposals (14,941)
Change in fair value 4,951
Carrying amount at 31 December 2021 188,485
5. Publication
The financial information set out in this preliminary announcement does not
constitute statutory accounts as defined in section 434 of the Companies Act
2006. The consolidated statement of financial position at 31 December 2021
and the consolidated statement of comprehensive income, the consolidated
statement of changes in equity, the consolidated statement of cash flows and
the associated notes for the year then ended have been extracted from the
Group's financial statements upon which the auditor's opinion is unqualified
and does not include any statement under section 498 of the Companies Act
2006. The statutory accounts for the year ended 31 December 2021 will be
delivered to the Registrar of Companies following the Company's Annual General
Meeting.
6. Copies of the announcement
Copies of this announcement are available for collection from the Company's
offices at 2(nd) Floor, 75-77 Colmore Row, Birmingham, B3 2AP and from the
Company's website at www.reiplc.com (http://www.reiplc.com) . The report and
accounts for the year ended 31 December 2021 are available from the Company's
website and will be posted to shareholders in May 2022.
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