REG - Sirius Real Estate - Half-year Report <Origin Href="QuoteRef">SRET.L</Origin> - Part 3
28/11/2016 07:05
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million is charged
at a fixed interest rate of 1.66 per cent for the full term of the loan.
Tranche 2, totalling E42.5 million is charged with a floating rate of 1.57 per
cent over three month EURIBOR (not less than 0 per cent.) for the full term of
the loan. Amortisation is set at 2.5 per cent across the full facility with
the remainder due in one instalment on the final maturity date. The facility
is secured over 11 property assets and is subject to various covenants with
which the Group has complied.
Berlin-Hannoversche Hypothekenbank AG
On 15 December 2014, the Group agreed to a facility agreement with
Berlin-Hannoversche Hypothekenbank AG for E36 million. The loan terminates on
31 December 2019. Amortisation is 2 per cent per annum for the first two
years, 2.4 per cent. for the third year and 2.8 per cent thereafter, with the
remainder due in the fifth year. The facility is charged a fixed interest rate
of 2.85 per cent. This facility is secured over three property assets and is
subject to various covenants with which the Group has complied.
On 28 April 2016, the Group agreed to a facility agreement with
Berlin-Hannoversche Hypothekenbank AG to add an additional tranche to the
existing loan that had an outstanding balance of E35.1 million at 31 March
2016. The additional tranche of E4.5 million brings the total loan to E39.6
million. The maturity of the additional loan tranche is coterminous with the
existing loan at 31 December 2019. Amortisation is 2.5 per cent per annum,
with the remainder due at maturity. The additional loan tranche is charged
with a fixed interest rate of 1.32 per cent for the full term of the loan. The
original facility agreement has been amended to include one previously
unencumbered property asset located in Würselen. The terms of the original
loan are unchanged and the loan continues to be subject to various covenants
with which the Group has complied.
K-Bonds
On 1 August 2013, the Group agreed to a facility agreement with K-Bonds for
E52 million. The loan consists of a senior tranche of E45 million and a junior
tranche of E7 million. The senior tranche has a fixed interest rate of 4 per
cent per annum and is due in one sum on 31 July 2023. The junior tranche has a
fixed interest rate of 6 per cent and terminates on 31 July 2020. The junior
tranche is amortised at E1 million per annum over a seven year period. This
facility is secured over four properties and is subject to various covenants
with which the Group has complied.
Convertible shareholder loan
On 22 March 2013, the Company issued E5.0 million convertible loan notes due
in 2018 (the "Loan Notes"). The entire issue of E5.0 million has been taken up
by the Karoo Investment Fund S.C.A. SICAV-SIF and Karoo Investment Fund II
S.C.A. SICAV-SIF. The Loan Notes were issued at par and carry a coupon rate of
5 per cent per annum The Loan Notes are convertible into Ordinary Shares of
the Company at an original conversion price of 0.24c and can now be converted
at any time. The conversion price is subject to dividend protection and, when
considering the dividends that the Group has paid to date, the current
conversion price is 0.225c as at 31 March 2016. The majority of the proceeds
from the issue of the Loan Notes were used to reduce debt levels.
On 23 June 2016, the Company announced that the Karoo Investment Fund S.C.A.
SICAV-SIF served notice to convert its E5,000,000 convertible loan notes due
in 2018 in full into, in aggregate, 22,814,731 new Ordinary Shares at the
conversion price of E0.22 per Ordinary share. Following the conversion on 23
June 2016 and the subsequent admission of the shares to AIM on 28 June 2016,
the overall issued share capital was 832,779,058 Ordinary Shares of which
1,062,058 were held in treasury. The total number of Ordinary Shares with
voting rights in the Company at this date was 831,717,000.
19. Financial instruments
Fair values
Set out below is a comparison by category of carrying amounts and fair values
of all of the Group's financial instruments that are carried in the financial
statements:
(Unaudited)30 September 2016 (Unaudited)30 September 2015 31 March 2016
CarryingamountE000 FairvalueE000 CarryingamountE000 FairvalueE000 CarryingamountE000 FairvalueE000
Financial assets
Cash 24,747 24,747 14,114 14,114 19,874 19,874
Trade receivables 1,808 1,808 1,857 1,857 3,069 3,069
Derivative financial instruments - - 66 66 19 19
Financial liabilities
Trade payables 4,483 4,483 7,359 7,359 6,960 6,960
Derivative financial instruments 599 599 1,890 1,890 2,590 2,590
Interest-bearing loans and borrowings:
Floating rate borrowings 41,969 41,969 - - - -
Floating rate borrowings - hedged* 24,875 24,875 55,775 55,775 80,329 80,329
Floating rate borrowings - capped* - - 55,775 55,775 55,200 55,200
Fixed rate borrowings 254,385 256,458 149,460 149,969 163,510 166,570
* The Group holds interest rate swap contracts designed to manage the
interest rate and liquidity risks of expected cash flows of its borrowings
with the variable rate facility with Bayerische Landesbank. Please refer to
note 18 for details of swap and cap contracts.
20. Issued share capital
Authorised Numberof shares SharecapitalE
Ordinary Shares of no par value Unlimited -
As at 30 September 2016 Unlimited -
Issued and fully paid Numberof shares SharecapitalE
Ordinary Shares of no par value
As at 31 March 2013 317,578,176 -
Issued Ordinary Shares 197,619,038 -
Issued Treasury Shares 3,703,093 -
As at 31 March 2014 518,900,307 -
Issued Ordinary Shares 109,901,495 -
Issued Treasury Shares 1,536,947 -
As at 31 March 2015 630,338,749 -
Issued Ordinary Shares 118,040,020 -
Issued Treasury Shares 3,606,118 -
As at 31 March 2016 751,984,887 -
Issued Ordinary Shares 88,470,738 -
Issued Treasury Shares 313,608 -
As at 30 September 2016 840,769,233 -
Holders of the Ordinary Shares are entitled to receive dividends and other
distributions and to attend and vote at any general meeting.
The following changes to the issued share capital of the Company have taken
place since 30 September 2015:
On 26 November 2015, the Company issued 62,500 Ordinary Shares out of treasury
to one of the Company's Executive Directors pursuant to the Company's MSP
incentive scheme. This resulted in the Company's overall issued share capital
being 747,882,541 Ordinary Shares of which 1,471,875 were held in treasury.
The total number of Ordinary Shares with voting rights in the Company at this
date was 746,473,166.
Pursuant to an issue of bonus shares on 26 November 2015, the Company issued
33,709 Ordinary Shares out of treasury to one of the Company's Executive
Directors and some of the Group's senior management team. This resulted in the
Company's overall issued share capital being 747,882,541 Ordinary Shares of
which 1,357,666 were held in treasury. The total number of Ordinary Shares
with voting rights in the Company at this date was 746,506,875.
Pursuant to a scrip dividend offering on 20 January 2016, the Company issued
5,478,012 Ordinary Shares at an issue price of E0.5178, resulting in the
Company's overall issued share capital being 753,360,553 Ordinary Shares of
which 1,375,666 were held in treasury. The total number of Ordinary Shares
with voting rights in the Company at this date was 751,984,887.
On 26 May 2016, the Company issued 313,608 Ordinary Shares out of treasury to
the Company's two Executive Directors and some of the Group's senior
management team pursuant to the Company's MSP incentive scheme. This resulted
in the Company's overall issued share capital being 753,360,553 Ordinary
Shares of which 1,062,058 were held in treasury. The total number of Ordinary
Shares with voting rights in the Company at this date was 752,298,495.
Pursuant to an equity raise of E30 million on 21 June 2016, the Company issued
56,603,774 Ordinary Shares at an issue price of E0.53, resulting in the
Company's overall issued share capital being 809,964,327 Ordinary Shares of
which 1,062,058 were held in treasury. The total number of Ordinary Shares
with voting rights in the Company at this date was 808,902,269.
On 23 June 2016, the Company announced that the Karoo Investment Fund S.C.A.
SICAV-SIF served notice to convert its E5,000,000 convertible loan notes due
in 2018 in full into, in aggregate, 22,814,731 new Ordinary Shares at the
conversion price of E0.22 per ordinary share. Following the conversion on 23
June 2016 and the subsequent admission of the shares to AIM on 28 June 2016,
the overall issued share capital was 832,779,058 Ordinary Shares of which
1,062,058 were held in treasury. The total number of Ordinary Shares with
voting rights in the Company at this date was 831,717,000.
Pursuant to a scrip dividend offering on 15 July 2016, the Company issued
9,052,233 Ordinary Shares at an issue price of E0.4822, resulting in the
Company's overall issued share capital being 841,831,291 Ordinary Shares of
which 1,062,058 were held in Treasury. The total number of Ordinary Shares
with voting rights in the Company at this date was 840,769,233.
The Company holds 1,062,058 of its own shares, which are held in treasury (31
March 2016: 1,375,666). During the period 313,608 shares were issued from
treasury.
New shares under the Scrip Dividend Alternative rank pari passu in all
respects with previously existing issued shares of the Company including the
right to receive all dividends and other distributions declared after
admission and the right to vote at any general meeting.
No shares were bought back in the period.
21. Dividends
In November 2015, the Company announced a dividend of 0.92c per share with a
record date of 18 December 2015 and payable on 20 January 2016. On the record
date, 747,882,541 shares were in issue, of which 1,375,666 were held in
treasury and 746,506,875 were entitled to participate in the dividend. Holders
of 311,075,606 shares elected to receive the dividend in ordinary shares under
the Scrip Dividend Alternative, representing a dividend of E2,862,000, while
holders of 435,431,269 shares opted for a cash dividend with a value of
E3,920,000. The total dividend was E6,782,000.
In May 2016 the Company announced a dividend of 1.30c per share with a record
date of 17 June 2016 and payable on 15 July 2016. On the record date,
753,360,553 shares were in issue, of which 1,062,058 were held in treasury and
752,298,495 were entitled to participate in the dividend. Holders of
334,125,185 shares elected to receive the dividend in ordinary shares under
the Scrip Dividend Alternative, representing a dividend of E4,344,000 while
holders of 418,173,310 shares opted for a cash dividend with a value of
E5,503,000. The total dividend was E9,847,000.
The Group's profit attributable to the equity holders of the Company for the
period was E32.9 million (30 September 2015: E28.1 million). The Board has
declared an interim dividend of 1.39c per share for the period ended 30
September 2016. The interim dividend will be paid on 20 January 2017 with the
ex-dividend dates being 13 December 2016 for shareholders on the South African
register and 15 December 2016 for shareholders on the UK register. The interim
dividend represents 65 per cent of Funds from Operations* for the period ended
30 September 2016. It is intended that dividends will continue to be paid on a
semi-annual basis and offered to shareholders in cash or scrip form.
The dividend paid per the statement of changes in equity is the value of the
cash dividend.
* Recurring profit before tax adjusted for depreciation, amortisation of
financing fees and current tax receivable/incurred
The dividend per share was calculated as follows:
(Unaudited)30 September 2016E million (Unaudited)30 September 2015E million 31 March 2016E million
Reported profit before tax 37.5 28.3 57.1
Adjustments for:
Surplus on revaluation (25.4) (27.0) (44.2)
Gain of disposals - - -
Non-recurring items 3.9 7.5 9.5
Change in fair value of financial derivatives 0.1 (0.2) 0.5
Recurring profit before tax 16.1 8.6 22.9
Adjustments for:
Depreciation 0.4 0.3 0.6
Amortisation of financing fees 0.6 0.8 1.3
Impact of disposal assets - - -
Surrender premium - - -
Current taxes receivable (see note 9) - 0.2 0.2
Funds from Operations, year ended 31 March n/a n/a 25.0
Funds from Operations, six months ended 30 September 17.1 9.9 9.9
Funds from Operations, six months ended 31 March n/a n/a 15.0
Dividend pool, six months ended 30 September 11.71 6.91 6.91
Dividend pool, six months ended 31 March n/a n/a 9.81
DPS, six months ended 30 September 1.39c 0.92c 0.92c
DPS, six months ended 31 March n/a n/a 1.30c
1 Calculated as 65 per cent of Funds from Operations of 2.13c per share
(30 September 2015: 1.41c per share; 31 March 2016: 2.01c per share) based on
average number of shares outstanding of 803,512,009 (30 September 2015:
707,075,634; 31 March 2016: 749,229,846).
22. Capital and other commitments
As at 30 September 2016, the Group had contracted capital expenditure on
existing properties of E5,504,000 (31 March 2016: E4,636,000) and commitments
of E2,922,000 (31 March 2016: E3,162,000) derived from office rental
contracts.
These commitments have not yet been provided for in the financial statements.
23. Post balance sheet events
On 19 October 2016 the Group notarised the disposal of a piece of non-income
producing land at the CöllnParc site for E1.5 million representing an increase
on the book value of 41 per cent.
On 20 October 2016, the Group concluded an agreement with Berlin-Hannoversche
Hypothekenbank AG to refinance and extend its existing loan, which had an
outstanding balance of E39.2 million at 30 September 2016. The new facility
totals E70.0 million and terminates on 29 October 2023. Amortisation is 2.5
per cent per annum with the remainder due at maturity. The facility is charged
with an all-in fixed interest rate of 1.48 per cent for the full term of the
loan. The facility is secured over five property assets including those
located in Dresden and Wiesbaden. Non-recurring costs associated with this
refinancing, including early redemption fees and breakage costs on the
existing facility are expected to be around E1.4 million. Of this amount E0.8
million is expected to impact upon net asset value immediately, while the
remainder, representing arrangement fees on the new facility, will be
amortised over the seven year term.
On 25 October 2016, the Group notarised the purchase of an asset located in
Krefeld. The property is a single let business park totalling 6,335 square
metres of office and warehouse space. The property is 100 per cent occupied,
producing annual income of E0.4 million with a weighted average remaining
lease term of 0.9 years.
With effect from 31 October 2016, the Group acquired a property located in
Wiesbaden for a total acquisition cost of E17.7 million using proceeds from
the June 2016 equity raise as described in note 20. This property is a
multi-let office building totalling 19,602 square metres. The property is 65
per cent occupied and let to three tenants, producing annual income of E1.9
million and having a weighted average remaining lease term of 2.7 years.
On 3 November 2016, the Group notarised the purchase of an asset located in
Dreieich. The property is a multi-let business park comprising office,
warehouse and service space totalling 12,905 square metres. The property is
29.4 per cent occupied, producing annual income of E0.29 million with a
weighted average remaining lease term of 1.7 years.
Corporate directory
Registered office
PO Box 119
Martello Court
Admiral Park
St. Peter Port
Guernsey GY1 3HB
Channel Islands
Registered number
Incorporated in Guernsey under the Companies (Guernsey) Law, 2008, as amended,
under number 46442
Company Secretary and administrator
Intertrust Fund Services (Guernsey) Limited
PO Box 119
Martello Court
Admiral Park
St. Peter Port
Guernsey GY1 3HB
Channel Islands
UK solicitors
Norton Rose Fulbright LLP
3 More London Riverside
London SE1 2AQ
Financial PR
Novella Communications
1a Garrick House
Carrington Street
London W1J 7AF
JSE sponsor
PSG Capital Proprietary Limited
1st Floor, Ou Kollege
35 Kerk Street
Stellenbosch
7600
South Africa
Nominated adviser and joint brokers
Peel Hunt LLP
120 London Wall
London EC2Y 5ET
Joint brokers
Canaccord Genuity Limited
88 Wood Street
London EC2V 7QR
Property valuer
Cushman & Wakefield LLP
Rathenauplatz 1
60313 Frankfurt am Main
Germany
Independent auditors
KPMG Channel Islands Limited
Glategny Court
Glategny Esplanade
St. Peter Port
Guernsey GY1 1WR
Channel Islands
Guernsey solicitors
Carey Olsen
PO Box 98
7 New Street
St. Peter Port
Guernsey GY1 4BZ
Channel Islands
This information is provided by RNS
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