REG - Supermarket Inc REIT - Half-year Report
02/03/2022 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220302:nRSB2924Da&default-theme=true
RNS Number : 2924D Supermarket Income REIT PLC 02 March 2022
Supermarket Income REIT plc
(the "Group" or the "Company")
LEI: 2138007FOINJKAM7L537
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2021
GROCERY SECTOR STRENGTH AND INFLATIONARY TAILWINDS PROVIDE SUPPORTIVE BACKDROP
FOR SUPERMARKET INCOME REIT
The Board of Directors of Supermarket Income REIT plc (LSE: SUPR), the real
estate investment trust providing secure, inflation-protected, long income
from grocery property in the UK, is today reporting its interim results for
the Group for the six months ended 31 December 2021 (the "Period").
FINANCIAL HIGHLIGHTS
Six months to Six months to Change
31-Dec-21 31-Dec-20 in Period
Annualised passing rent £70.2m £46.1m +52%
EPRA Earnings £26.9m £15.5m +74%
Profit before tax £68.9m £33.0m +109%
Dividend paid per share 3.0 pence 2.9 pence +3%
IFRS EPS 7.9 pence 5.9 pence +34%
EPRA EPS 3.1 pence 2.8 pence +11%
EPRA dividend cover 1.13x 1.12x n/a
31-Dec-21 30-June-21 Change
in Period
IFRS net assets £1,115m £871m +28%
EPRA NTA £1,113m £872m +28%
EPRA NTA per share 113 pence 108 pence +5%
Loan to value (Direct Portfolio) 32.1% 34.0% -6%
Portfolio net initial yield 4.7% 4.7% 0%
· 48% Total Shareholder Return since the initial listing in July
2017 1 (#_ftn1)
· On track to deliver full-year 2022 target dividend of 5.94 pence
per share
· Direct Portfolio independently valued at £1,413.5 million,
increasing by £265.1 million for the Period following valuation growth of
£21.7 million and new acquisitions of £243.4 million (excluding acquisition
costs)
o 2% valuation growth on a like-for-like basis for the Period
o Direct Portfolio net initial yield ("NIY") of 4.7%
o Direct Portfolio weighted unexpired lease term ("WAULT") of 15 years
· Annualised passing rent increased by 52% to £70.2 million
following rent reviews and new acquisitions during the Period
· Value of investment in the Sainsbury's Reversion Portfolio
increased by £37.2 million to £167.5 million, following the exercise of
purchase options by Sainsbury's
· EPRA NTA per share increased by 5 pence in the Period to 113 pence
as at 31 December 2021
BUSINESS HIGHLIGHTS IN THE PERIOD
· Further portfolio growth through the deployment of £200.0 million
of equity raised via an upsized and over-subscribed Placing and Offer for
Subscription in October 2021
· Acquisition of eight omnichannel supermarkets at an aggregate
purchase price of £243.4 million (excluding acquisition costs)
o New acquisitions weighted average NIY of 4.5%
o New acquisitions WAULT of 16 years
· Seven rent reviews, adding £0.9 million annualised rental income,
and a lease regear completed
· Sainsbury's exercised its first option to acquire 13 supermarkets
in the Sainsbury's Reversion Portfolio
POST BALANCE SHEET HIGHLIGHTS
· Migration of the Group's listing to the Premium Segment of the
FCA's Official List and London Stock Exchange's Main Market, from the
Specialist Fund Segment
· Fitch Ratings Limited ("Fitch") Investment Grade credit rating of
BBB+ assigned to the Group
· Purchase of three omnichannel supermarkets for £128.3 million
(excluding acquisition costs)
o New acquisitions weighted average NIY of 4.8%
o New acquisitions WAULT of 19 years
· Active asset management led to a lease regear of the Tesco
supermarket in Leicester
· 85% of rental income for the Direct Portfolio directly linked to
inflation
· Sainsbury's exercised its second option to acquire eight further
stores in the Sainsbury's Reversion Portfolio, acquiring in total 21 of 26
stores upon current lease expiry in mid-2023
Nick Hewson, Chairman of Supermarket Income REIT plc, commented:
"I am very pleased to be reporting another strong set of results for the Group
which reflect significant growth in the Period.
We have continued to diversify our portfolio by sourcing and acquiring high
quality omnichannel supermarket properties that represent the future model of
grocery in the UK. We are delighted to have achieved the strategic milestones
of becoming a Premium Segment listed company and receiving an Investment Grade
credit rating, demonstrating both the strength and maturity of our business.
Since our IPO in July 2017, we have delivered a Total Shareholder Return of
48% for our shareholders.
In this highly inflationary environment, our portfolio offers investors
secure, long-term, inflation-protected income that is backed by one of the
most compelling real estate asset classes in the UK investment market."
PRESENTATION FOR ANALYSTS
A presentation to analysts will take place today at 08.30am.
Webcast details are as follows:
https://webcasting.brrmedia.co.uk/broadcast/6203c5f6636d105baf47a366
(https://webcasting.brrmedia.co.uk/broadcast/6203c5f6636d105baf47a366)
The results presentation is available in the Investor Centre section of the
Group's website. For further details, please email Dido Laurimore
at SupermarketIncomeREIT@fticonsulting.com
(mailto:SupermarketIncomeREIT@fticonsulting.com)
FOR FURTHER INFORMATION
Atrato Capital +44 (0)20 3790 8087
Limited
Steven Noble / Rob Abraham / Kate Heseltine ir@atratocapital.com
Stifel Nicolaus Europe Limited
Mark Young / Matt Blawat +44 (0)20 7710 7600
FTI Consulting +44 (0)20 3727 1000
Dido Laurimore / Eve Kirmatzis / Andrew SupermarketIncomeREIT@fticonsulting.com
Davis
NOTES TO EDITORS:
Supermarket Income REIT plc (LSE: SUPR) is a real estate investment trust
dedicated to investing in grocery properties which are an essential part of
the UK's feed the nation infrastructure. The Group focuses on grocery stores
which are omnichannel, fulfilling online and in-person sales. All of the
Group's 67 supermarkets((1)) are let to leading UK supermarket operators,
diversified by both tenant and geography.
The Group provides investors with secure, inflation-protected, long income
with the potential for capital appreciation over the longer term and targets a
7% to 10% p.a. Total Shareholder Return over the medium term((2)). Atrato
Capital Limited is the Group's Investment Adviser.
Further information is available on the Group's website
www.supermarketincomereit.com (http://www.supermarketincomereit.com/)
1. 41 directly owned supermarkets, plus 26 via joint venture
2. There is no certainty that these illustrative projections will be
achieved
CHAIRMAN'S STATEMENT
Dear Shareholder,
I am delighted to report to you another period of strategic progress and
strong financial performance for the Group. During the Period we have
delivered a 5 pence increase in our EPRA NTA per share, from 108 pence per
share to 113 pence per share as at 31 December 2021. We have also successfully
deployed the proceeds of our oversubscribed equity raise of £200 million in
October 2021, acquiring a further £372 million of supermarket property
assets2 (#_ftn2) .
Since our IPO in July 2017, we have grown our investment portfolio to £1.6
billion and delivered a Total Shareholder Return of 48%.
Our strategy is to invest in omnichannel supermarkets which we firmly believe
is the future model of grocery retailing in the UK. Omnichannel supermarkets
operate both as physical supermarkets and as online fulfilment centres
performing a critical role in the business strategies of our tenants.
Over the past two years UK grocery sales have materially increased above
pre-pandemic levels. This reflects the lasting impact of changes to working
habits on the UK grocery market. Kantar's January 2022 grocery sales data
demonstrates the full extent of this impact, with UK grocery sales remaining
10% higher than pre-pandemic levels, despite the gradual re-opening of the
economy.
Our omnichannel stores have captured an outsized share of the increase in
grocery demand as the growth in online sales fulfilled from stores has
significantly exceeded that of the overall market.
Against this backdrop we have seen record levels of capital investment in the
UK grocery sector. In October 2021 Clayton, Dubilier & Rice completed the
£7 billion takeover of Morrisons, following on from Asda's £7 billion
takeover by EG & TDR Capital in February of the same year. The managers of
global equity capital clearly believe it is the right time in the cycle to
make strategic investments in this space to capitalise on the strong
underlying fundamentals of the asset class, combined with post-pandemic
changes in consumer habits and the growth in online shopping.
In January 2022, Colliers highlighted that UK supermarket property investment
volumes in 2021 were once again over £1.8 billion (2020: £1.8 billion).
This continuing investment interest has resulted in supermarket property
yields compressing, supporting our long-term investment thesis.
Our Direct Portfolio of investment properties was independently valued on 31
December 2021 at £1,413.5 million, reflecting a 2% like-for-like growth in
value during the Period. A key focus of the investment market remains
mitigating the impact of higher inflation. In that regard, we are especially
pleased to have built a portfolio benefiting from long, index linked, leases,
with 85% of our rental income directly linked to inflation3 (#_ftn3) . The
grocery sector is particularly resilient in an inflationary environment, with
an ability to pass on supply chain cost pressures through price increases. Our
rents remain highly affordable with average rent to turnover across our
portfolio of approximately 4%4 (#_ftn4) .
The Group achieved two significant strategic milestones after the balance
sheet date. Firstly, Supermarket Income REIT is now listed on the Premium
Segment of the FCA's Official List and the London Stock Exchange's Main Market
following the migration of the Group's shares from the Specialist Fund Segment
on 23 February 2022. We expect our new Premium Segment listing to deliver
benefits to our existing shareholders, including the increased liquidity that
can arise from inclusion in stock indices.
Secondly, the Group has achieved an Investment Grade BBB+ (stable outlook)
credit rating. This solid Investment Grade rating from Fitch will enable us to
pursue a wider range of debt funding strategies going forward.
We continue to prioritise Environmental, Social and Governance ("ESG")
matters. Last year we completed a materiality assessment, and we are using the
shortlisted factors identified by our stakeholders to inform our strategy and
to continue to enhance our reporting and disclosures in these key areas.
During the Period, we became supporters of the Task Force on Climate-related
Financial Disclosures ("TCFD") and we are also on track to become signatories
of the UN Principles for Responsible Investment ("UN PRI"). We look forward to
reporting further updates on these, as well as progress on our wider ESG
strategy, over the coming year.
Outlook
We are now operating in a highly inflationary environment, making our secure,
upward only, inflation-linked rental reviews an ever more appealing source of
inflation protected income. Given the high degree of correlation between
inflation and food prices and the level of investor appetite in the sector, we
believe we will see continued progressive growth in both supermarket rents and
capital values.
Whilst we remain mindful of the uncertain political and macro-economic outlook
and the ongoing economic risks of rising inflation and higher interest rates,
we nevertheless feel well positioned for the future given the strengths of our
chosen sector and the resilience of our income profile.
Through our deep sector expertise and strong relationships with both our
tenants and the investment market within which we operate, we have built a
leading portfolio in one of the most compelling real estate asset classes in
the UK investment market. We are delighted to now be a Premium Segment listed
company with an Investment Grade credit rating.
Nick Hewson
Chairman
01 March 2022
KEY PERFORMANCE INDICATORS
Our objective is to provide secure, inflation-protected, long income from
grocery property in the UK. Set out below are the key performance indicators
we use to track our progress.
KPI Definition Performance
1. Total Shareholder Return Shareholder return is one of the Group's principal measures of performance. 6.3% for the six months ended 31 December 2021
(Six months ended
Total Shareholder Return ("TSR") is measured by reference to the growth in the
31 December 2020: -1.8%)
Group's share price over a period, plus dividends.
2. WAULT WAULT measures the average unexpired lease term of the Direct Portfolio, 15 years WAULT as at 31 December 2021 (As at 30 June 2021: 15 years)
weighted by the Direct Portfolio valuations.
3. EPRA NTA per share The value of our assets (based on an independent valuation) less the book 113 pence per share as at 31 December 2021 (As at 30 June 2021: 108 pence per
value of our liabilities, attributable to Shareholders and calculated in share)
accordance with EPRA guidelines. EPRA state three measures of NAV to be used;
of which the Group deem EPRA NTA as the most meaningful measure. See Note 23
for more information.
4. Net Loan to Value The proportion of our Direct Portfolio gross asset value that is funded by 32.1% as at 31 December 2021 (As at 30 June 2021: 34.0%)
borrowings calculated as balance sheet borrowings less cash balances divided
by total investment properties valuation.
5. EPRA EPS Earnings attributable to Shareholders adjusted for other earnings not 3.1 pence per share for the six months ended 31 December 2021 (Six months
supported by cash flows and calculated in accordance with EPRA guidelines. ended
31 December 2020: 2.8 pence per share)
The Group uses alternative performance measures including the European Public
Real Estate ("EPRA") Best Practice Recommendations ("BPR") to supplement its
IFRS measures as the Board considers that these measures give users of the
Annual Report and financial statements the best understanding of the
underlying performance of the Group's property portfolio.
The EPRA measures are widely recognised and used by public real estate
companies and investors and seek to improve transparency, comparability and
relevance of published results in the sector.
Reconciliations between EPRA measures and the IFRS financial statements can be
found in Notes 10 and 23 to the financial statements.
EPRA PERFORMANCE INDICATORS
The table below shows additional performance measures, calculated in
accordance with the Best Practices Recommendations of the European Public Real
Estate Association (EPRA). We provide these measures to aid comparison with
other European real estate businesses.
For a full reconciliation of all EPRA performance indicators, please see the
Notes to EPRA measures within the supplementary section of the interim
financial statements.
Measure Definition Performance
1. EPRA Earnings per Share A measure of EPS designed by EPRA to present underlying earnings from core 3.1 pence per share for the
operating activities.
six months ended
31 December 2021
(Six months ended
31 December 2020:
2.9 pence per share)
2. EPRA Net Reinstatement Value (NRV) per share An EPRA NAV per share metric which assumes that entities never sell assets and 123 pence per share as at
aims to represent the value required to rebuild the entity.
31 December 2021 (As at
30 June 2021: 118 pence per share)
3. EPRA Net Tangible Assets (NTA) per share An EPRA NAV per share metric which assumes entities buy and sell assets, 113 pence per share as at
thereby crystallising certain levels of unavoidable deferred tax.
31 December 2021 (As at
30 June 2021: 108 pence per share)
4. EPRA Net Disposal Value (NDV) per share An EPRA NAV per share metric which represents the Shareholders' value under a 113 pence per share as at
disposal scenario, where deferred tax, financial instruments and certain other
31 December 2021 (As at
adjustments are calculated to the full extent of their liability, net of any
30 June 2021: 107 pence
resulting tax.
per share)
5. EPRA Net Initial Yield (NIY) & EPRA "Topped-Up" Net Initial Yield Annualised rental income based on the cash rents passing at the balance sheet 4.6% as at 31 December 2021 (As at 30 June 2021: 4.8%)
date, less non-recoverable property operating expenses, divided by the market
value of the property, increased with (estimated) purchasers' costs. The
"topped-up" yield is the same as the standard measure as we do not have
adjustments for any rent-free periods or other lease incentives.
6. EPRA Vacancy Rate Estimated Market Rental Value (ERV) of vacant space divided by ERV of the 0.2% as at 31 December 2021 (As at 30 June 2021: 0.4%)
whole portfolio.
7. EPRA Cost Ratio Administrative & operating costs (including costs of direct vacancy) 15.8% for the six months ended 31 December 2021
divided by gross rental income.
(Six months ended
31 December 2020:19.9%)
INVESTMENT ADVISER'S REPORT
Atrato Capital Limited, the Investment Adviser to the Group, is pleased to
report on the operations of the Group for the Period.
Overview
Supermarkets continue to demonstrate their critical role in the UK economy as
core food infrastructure. Grocery sales remain 10% higher than pre-pandemic
levels despite the re-opening of the economy, in part due to a longer-term
structural shift towards working from home resulting in a more permanent
increase in household spend on groceries.
Whilst in-store shopping remains the dominant channel, representing 87%5
(#_ftn5) of all grocery market sales, there has been an acceleration in the
channel shift to online grocery in line with the digital transformation of the
UK economy. Online grocery accounts for 13%5 (#_ftn6) of the UK grocery market
and has nearly doubled in market share since the start of the pandemic.
A key pillar of the Group's investment strategy is to invest in
'future-proofed' omnichannel supermarkets that facilitate in-store shopping,
while also forming part of the UK online grocery distribution network. It is
omnichannel stores such as those in the Supermarket Income REIT portfolio that
have primarily benefited from increased market volumes, with 80% of all UK
online orders fulfilled from a store. Omnichannel stores with in-store picking
for online orders are capital light, flexible, rapidly scalable and are now a
profitable method of fulfilment for online grocery.
Unlike other sectors which have been disrupted by online-only players, the
major supermarket operators
(68% market share) have dominated the online channel shift. Their existing
store networks provide them with an invaluable last mile delivery
infrastructure and create a significant barrier to entry. The Group's tenants
are continuing to invest in its assets to build out their online fulfilment
capacity.
The Group is highly selective in the supermarkets it acquires and seeks to
ensure that its assets benefit from long unexpired lease terms with
contractual, upward only, rental uplifts. In addition, we undertake a robust
process of due diligence to identify acquisition opportunities and screen for
sustainability credentials. The Group's stores typically have the following
attributes:
· sites which are critical to the operations of the UK's leading
grocers;
· ideally located for large catchment populations and excellent
transportation links;
· long unexpired lease terms with inflation linked rental uplifts;
· robust underlying trading and strong tenant covenants;
· attractive property fundamentals with opportunities for active
asset management; and
· good sustainability credentials or the opportunity for
improvement through asset management
88%6 (#_ftn7) of leases within the portfolio benefit from contractual rental
uplifts, either to inflation (85%) or through fixed uplifts (3%). With
supermarket rents a function of store turnover, the combination of the
enlarged grocery sector and the inflationary environment provide favorable
tailwinds for sustainable rental growth, from which the Group is well placed
to benefit over the long term.
Investment activity - Direct Portfolio
The Investment Adviser has continued to identify accretive pipeline
opportunities and deploy capital, including the proceeds from the recent
equity raise. During the Period, the Group added eight accretive supermarket
assets for £243.4 million (excluding acquisition costs):
· August 2021: An M&S and Aldi in West Derby, Liverpool for
£10.2 million. The M&S store has 10 years unexpired lease term and
five-yearly, upward-only, open market rent reviews. The Aldi store has 15
years unexpired lease term and five-yearly, upwards only, 2.5% fixed rent
reviews compounded annually.
· September 2021: An Aldi in Oldham, Manchester for £5.6 million
with 10 years unexpired lease term and
five-yearly, upwards-only, 2% fixed rent reviews compounded annually.
· September 2021: A Tesco in Prescot, Merseyside for £50.0 million
with 15 years unexpired lease term and annual, upwards-only, CPI-linked rent
reviews.
· September 2021: A Morrisons in Workington, Cumbria for £28.9
million with 17 years unexpired lease term and five-yearly, upwards-only,
CPI-linked rent reviews.
· November 2021: Sainsbury's in Swansea, and Tesco in Maidstone,
for £73.0 million with a weighted average unexpired lease term of 21 years,
both with five-yearly, upward-only, open market rent reviews.
· November 2021: Sainsbury's in Cannock for £75.8 million with 15
years unexpired lease term and five-yearly, upward-only, RPI-linked rent
reviews.
The acquisitions have a weighted average unexpired lease term of 16 years and
a weighted average net initial yield of 4.5%, supporting the Group's ability
to grow its dividend whilst also enhancing the quality and diversification of
the Portfolio.
Included in the acquisitions above were 10 non-food units which were acquired
as part of the site freeholds. These units serve to enhance the onsite offer
and have the potential for value enhancing asset management. These have been
valued at £13.9 million as at 31 December 2021 and consist of a mix of
non-food retail and consumer services. Post balance sheet the Group acquired a
further three supermarkets with a weighted average net initial yield of 4.8%
and a weighted average unexpired lease term of 19 years for a total
consideration of £128.3 million (excluding acquisition costs). This included
the Group's first Asda store, providing further tenant diversification to the
Portfolio.
The stores acquired post balance sheet were:
· January 2022: Sainsbury's in Washington and Asda in Cwmbran for
£55.1 million with a weighted average unexpired lease term of 21 years. The
Sainsbury's has seven-yearly, upward-only, RPI-linked rent reviews and the
Asda has five-yearly, upwards-only, open market rent reviews.
· January 2022: Tesco in Sheffield for £73.2 million with 17 years
unexpired lease term and annual, upward-only, RPI-linked rent reviews.
Included in the acquisitions above were two non-food, quick service
restaurant, units which were acquired as part of the site freeholds and serve
to enhance the onsite offer. These have been acquired for a combined value of
£2.5 million (excluding acquisition costs). The total acquisitions of £371.7
million (excluding acquisition costs) from
1 July 2021 were financed from the Group's equity raises, in March 2021 and
October 2021, and drawings from banking facilities (see financing below).
A table summarising the properties in the Direct Portfolio of supermarkets can
be found in the Portfolio section on the Group's website:
www.supermarketincomereit.com (http://www.supermarketincomereit.com)
Investment activity - Sainsbury's Reversion Portfolio (pre and post balance
sheet events)
In May 2020 the Group formed a 50:50 joint venture (the "JV") with British
Airways Pension Trustees Limited to acquire from British Land Plc a 25.5%
stake in one of the UK's largest portfolios of supermarket properties (the
"Sainsbury's Reversion Portfolio") for £102 million, excluding acquisition
costs. Subsequently, in February 2021 the JV acquired a further 25.5% stake in
this portfolio from Aviva for £115 million, excluding acquisition costs.
As such, the Group's total contribution to the JV was £108.5 million,
excluding acquisition costs, and freehold interests of the properties are now
owned by Sainsbury's (49%) and the JV (51%). Further details of the JV can be
found in note 13 to the financial statements.
The Sainsbury's Reversion Portfolio comprises a high-quality portfolio of 26
predominantly omnichannel Sainsbury's supermarkets with strong trading
histories and attractive property fundamentals. At acquisition, the stores in
the Sainsbury's Reversion Portfolio were leased to Sainsbury's until 2023. The
investment case for acquiring the stakes in the Sainsbury's Reversion
Portfolio was largely based on the Group's conviction that Sainsbury's would
want to remain in occupation of a large majority of the stores.
In September 2021 and in January 2022 (shortly after the balance sheet date),
Sainsbury's exercised options to acquire 21 stores within the Portfolio. This
outcome is in-line with the Group's initial underwriting of the transaction
and is evidence of the strength of demand for UK grocery assets.
Sainsbury's purchase price under the option is to be determined based on the
assumption of a new 20-year lease term at the higher of passing or open market
rent, subject to upward-only, five yearly market rent reviews.
The exercise of Sainsbury's option to purchase 21 of the 26 stores has
generated a material valuation gain for the Group, as detailed in the
Portfolio Valuation section below. The remaining five stores within the
portfolio remain under negotiation with Sainsbury's.
Portfolio valuation
Cushman & Wakefield valued the Direct Portfolio as at 31 December 2021 in
accordance with the RICS Valuation Global Standards. The properties were
valued individually without any premium/discount applying to the Portfolio as
a whole.
The Direct Portfolio market value was £1,413.5 million, an increase of
£265.1 million for the Period following valuation growth of £21.7 million
and new acquisitions of £243.4 million reflecting a net initial yield ("NIY")
of 4.7% and a like for like valuation growth of 2.0%.
The valuation growth in the Direct Portfolio reflects the strength of our
covenants, continuing heightened investor appetite for supermarket property
assets, and our ability to source off-market acquisitions for the Group in a
market where new supply is limited. Against a backdrop of high inflation and
broader industry tailwinds,
the Investment Adviser believes further growth in market rents and valuations
can be achieved in
the future.
The Group's beneficial interest in the Sainsbury's Reversion Portfolio, held
as an investment in a joint venture, was also independently valued by Cushman
& Wakefield in accordance with the RICS Valuation Global Standards.
The net carrying value of the underlying investment has increased by a total
of £37.2 million to £167.5 million during the Period. This increase is
recognised within the Group's share of income from joint venture as shown
within the consolidated statement of comprehensive income.
Asset Management
During the Period, the Group completed seven rent reviews, resulting in an
annualised increase in rental income of £0.9 million. The average rental
uplift for the rent reviews in the Period was 6.3% across seven stores of
which three stores benefited from a 5-yearly rent reviews.
The Group has also completed two notable lease regears. In September 2021 the
Group completed the acquisition of a Tesco in Prescot and simultaneously
regeared its lease with rent reviews to open market value with a four-year
remaining term on the same day. The regear secured the Group a new 15-year
lease with annual CPI uplifts, rebased to 4% rent-to-turnover (from 5%),
consistent with the wider portfolio, whilst creating the potential to expand
home delivery at the rear of the property. The Investment Adviser identified
this opportunity and initiated discussions with the vendor and the operator
two-years ago in order to create an off-market acquisition opportunity.
After the balance sheet date, in February 2022, the Group completed the regear
of an open market value lease with eight years remaining on our Tesco in
Leicester. This is a strategically important store for the operator with a
significant home delivery operation. The new 15-year lease with annual RPI
uplifts, also rebased to 4% rent-to-turnover, generated an attractive total
return on cost for the Group.
Environmental, Social and Governance ('ESG')
The Group is committed to building a resilient portfolio that plays an
integral role in local communities and contributes to the natural environment
and path to net zero, and it recognises the importance of tenant engagement to
achieve this.
Last year the Group completed a materiality assessment using a specialist
third party. The shortlisted ESG factors identified as priorities by
stakeholders are being used to inform the strategy and continue enhancing
reporting and disclosures in these key areas.
Unsurprisingly, given the footprint of the assets, building energy ratings
were identified among the highest priorities. The Group is pleased to report
that three quarters of its Direct Portfolio assets are rated EPC C or above,
with energy efficiency being an important consideration in the investment
decision-making process. The Group only acquires stores with an EPC rating of
C or above, or where asset management opportunities have been identified to
improve the rating to this level as a minimum.
The Group is aware of the UK government's Minimum Energy Efficiency Standards
(MEES) requirements to ensure that all commercial properties have an EPC
rating of at least a "B" by the end of 2030, with the first compliance window
being April 2028. In the period to 30 June 2022, the Investment Adviser
continues to work on an integrated Sustainable Investment management plan to
address those properties most at risk of not complying to the various rating
deadlines that have been set out in the MEES framework. We are confident that
this will enable us to meet or exceed the specified targets within the
required timeframe.
During the Period, the Group declared its support for the TCFD, and it is also
on track to become a signatory of the UN PRI. The Group looks forward to
providing further updates on these, and progress on the wider ESG strategy, in
the 2022 Annual Report.
Financial results
IFRS net rental income for the Period increased by 59.8% to £32.6 million
(six months to 31 December 2020:
£20.4 million). Contracted inflation-linked rent reviews in the Period
resulted in average passing rent increases of 6.3% (six months to 31 December
2020: 0.9%), in addition to IFRS £2.2 million rental contribution from
new acquisitions.
Administrative and other expenses, which include management and advisory fees
and other costs of running the Group, were £6.2 million (six months to 31
December 2020: £4.1 million) generating an annualised EPRA cost ratio for the
Period of 15.8% (six months to 31 December 2020: 19.9%).
Financing costs for the Period were £5.7 million (six months to 31 December
2020: £3.7 million). As at 31 December 2021, the Group's weighted average
finance cost was circa 2.5% (six months to 31 December 2020: 2.7%).
Operating profit, before changes in the fair value of investment properties,
as reported under IFRS, increased by 61.9% to £26.4 million (six months to 31
December 2020: £16.3 million).
The net change in fair value of the Direct Portfolio investment properties in
the Period was £11.0 million (six months to 31 December 2020: £15.5
million), which comprises a £21.7 million valuation gain offset by £9.3
million acquisition costs and a £1.4 million rent smoothing adjustment.
As at 31 December 2021, the EPRA NTA per share was 113 pence (30 June
2021: 108 pence), an increase of 4.6%.
The Group is a qualifying UK Real Estate Investment Trust ("REIT") which
exempts the Group's property rental business from UK Corporation Tax.
Dividend
The Group declared two interim dividends for the Period, on 23 September 2021
a Q4 2021 final dividend of 1.465 pence per share and on 10 January 2022, a Q1
2022 interim dividend of 1.485 pence per share. The Q2 2022 interim dividend
of 1.485 pence per share was declared after the period end and the Group
remains on track to declare dividends of 5.94 pence per share for the
financial year. The Group's EPRA dividend cover ratio, which shows the level
of cover of EPRA earnings versus dividends paid for the Period, was 1.13x for
the Period.
The earnings from the Sainsbury's Reversion Portfolio are used to repay debt
secured against that portfolio and the Group does not receive a cash
distribution from those earnings. As such, it has also calculated an adjusted
EPRA dividend cover ("Adjusted EPRA Dividend Cover") which excludes
undistributed profits of the Sainsbury's Reversion Portfolio. The Adjusted
EPRA Dividend Cover for the Period was 0.87x (six months to 31 December 2020:
0.91x) reflecting the increase in the Group's investment in the Sainsbury's
Reversion Portfolio in February 2021.
Financing and hedging
In October 2021, the Group successfully completed an oversubscribed £200.0
million Placing and Offer for Subscription, under which 173,913,043 New
Ordinary Shares were issued at 115 pence per New Ordinary Share, representing
a 6.5% premium to prevailing EPRA NTA at the time of issue. Following a strong
level of support
from investors during the marketing roadshow, the October Placing was
increased from the original target of
£100.0 million.
During the Period, the Group has broadened its banking relationships further.
In August 2021, the Group increased its secured term loan with Deka by £20.0
million to £96.6 million for the remaining three-year term. The new tranche
of the secured term has a fixed rate of 1.72%.
Similarly, in August 2021 the Group also completed a one-year extension
alongside a £10.0 million increase to its Revolving Credit Facility with
HSBC, priced at a margin of 1.75% above SONIA.
In September 2021, the Group exercised its accordion option under the Wells
Fargo credit facility by £61.3 million. The new tranche has a term of two
years plus three one-year extension options at a margin of 1.40% above SONIA.
After the balance sheet date, in January 2022, the Group arranged a £136.5
million increase to its Revolving Credit Facility with Barclays and Royal Bank
of Canada. Following this increase, the total size of the facility is
£250.2 million with a further £49.8 million uncommitted accordion option,
which is exercisable at any time over the term of the facility. This secured,
interest-only, Revolving Credit Facility has a remaining term of two years and
two further one-year extension options, with a margin of 1.50% above SONIA.
In February 2022, the Group was assigned by Fitch Ratings Limited an
Investment Grade BBB+ (stable outlook) credit rating, which will enable a
wider range of debt funding strategies moving forward.
A summary of the Group's credit facilities is provided below:
Lender Facility Maturity Running interest cost Loan commitment Amount drawn at 31 December 2021 £m
£m
HSBC Revolving Credit Facility Aug 2023 1.84% 100.0 77.4
HSBC Revolving Credit Facility Aug 2023 1.94% 50.0 -
Bayerische Landesbank Term Loan Jul 2023 2.75% 52.1 52.1
Bayerische Landesbank Additional Term Loan A July 2023 2.17% 7.3 7.3
Bayerische Landesbank Additional Term Loan B Aug 2025 2.22% 27.5 27.5
Deka Bank Term loan Aug 2026* 2.08% 47.6 76.6
Deka Bank Term loan Aug 2026* 2.24% 28.9 28.9
Deka Bank Term loan Aug 2026* 1.91% 20.0 20.0
Wells Fargo Revolving Credit Facility July 2027* 2.30% 30.0 30.0
Wells Fargo Revolving Credit Facility July 2027* 2.38% 60.0 60.0
Wells Fargo Revolving Credit Facility July 2027* 1.59% 61.4 47.2
Barclays and RBC Revolving Credit Facility Jan 2026* 1.69% 113.8 113.8
Total 568.7 481.9
Post balance sheet events
Barclays and RBC Revolving Credit Facility Jan 2026* 1.69% 136.5 n/a
Total 705.2 n/a
Average running cost 1.91%
*Including two further one-year extension options.
Total net debt as at 31 December 2021 stood at £454.0 million (30 June 2021:
£390.1 million), reflecting a net
loan-to-value ("LTV") ratio of 32.1% (30 June 2021: 34.0%). The Group's
medium-term debt target is an LTV ratio of 30%-40%.
Each loan drawn under the credit facilities requires interest payments only
until maturity and is secured against both the subject properties and the
shares of the property-owning entities. Each property-owning entity is either
directly or ultimately owned by the Group.
The Group has significant headroom on its LTV covenants. The covenants contain
a maximum 60% LTV threshold and a minimum 200% interest cover ratio for each
asset in the Portfolio. As at 31 December 2021, the Group could afford to
suffer a fall in property values of 29.5% before being in breach of its LTV
covenants and with the current hedging arrangements it has in place it has
504% of interest cover.
The Group utilises hedging derivatives to partially offset the effect of a
rise in underlying interest rates. Further details of our debt and hedging can
be found within notes 17 and 18 of these accounts.
Atrato Capital Limited
Investment Adviser
01 March 2022
PRINCIPAL RISKS AND UNCERTAINITIES
The principal risks of the business are set out on pages 34 to 39 of the
Annual Report 2021 and include commentary on their potential impact, links to
the Group's strategic priorities and the relevant mitigation factors. Since
the publication of the Annual Report 2021, the Board believes that there has
been no material change to the principal risks as stated and are expected to
remain unchanged for the remaining six months of the financial year.
Since March 2020, the COVID-19 pandemic has been considered a principal risk
to the business. We expect this risk to continue for the remainder of 2022.
The grocery sector continues to be robust in the face of the wider challenges
posed by the pandemic, reporting increased sales, albeit pitted against higher
costs, and a rapid positive response to the changing ways in which customers
shopped. This has resulted in the supermarket asset class being resilient and
in high demand, underpinning asset values. The Board, the AIFM and the Adviser
continue to monitor the
impact of the pandemic and where necessary implement additional controls to
anticipate and mitigate any
adverse consequences.
ALTERNATIVE INVESTMENT FUND MANAGER (the "AIFM")
The AIFM was appointed with effect from 15 June 2017 as the Company's
alternative investment fund manager under the terms of a Management Agreement
between the Company and the AIFM, in accordance with the Alternative
Investment Fund Manager's Directive and the Alternative Investment Fund
Managers Regulations 2013.
The AIFM is licensed and regulated by the Guernsey Financial Services
Commission.
The AIFM is responsible for the day-to-day management of the Company's
investments, subject to the investment objective and investment policy and the
overall supervision of the Directors. The AIFM is also required to comply with
on-going capital, reporting and transparency obligations and a range of
organisational requirements and conduct of business rules. The AIFM must also,
as the AIFM for the Company, adopt a range of policies and procedures
addressing areas such as risk management, liquidity management, conflicts of
interest, valuations, compliance, internal audit and remuneration.
DIRECTORS' RESPONSIBILITY STATEMENT
The Directors confirm that, to the best of their knowledge, this condensed set
of consolidated financial statements has been prepared in accordance with IAS
34 as adopted by the United Kingdom and that the operating and financial
review included herein provides a fair review of the information required by
DTR 4.2.7 and DTR 4.2.8 of the Disclosure and Transparency Rules of the United
Kingdom's Financial Conduct Authority, namely:
· an indication of important events that have occurred during the
Period and their impact on the condensed financial statements and a
description of the principal risks and uncertainties for the remaining months
of the Group's financial year; and
· disclosures of any material related party transactions in the Period.
These are included in note 22.
A full list of Directors of the Company can be found at the end of this
interim report.
Shareholder information is as disclosed on the Supermarket Income REIT plc
website.
For and on behalf of the Board
Nick Hewson
Chairman
01 March 2022
INDEPENDENT REVIEW REPORT TO SUPERMARKET INCOME REIT PLC
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 31 December 2021 is not prepared, in
all material respects, in accordance with UK adopted International Accounting
Standard 34 and the Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
We have been engaged by the Group to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 31
December 2021 which comprises Condensed Consolidated Statement of
Comprehensive Income, the Condensed Consolidated Statement of Financial
Position, the Condensed Consolidated Statement of Changes in Equity, the
Condensed Consolidated Cash Flow Statement and the related notes.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information Performed by
the Independent Auditor of the Entity" ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing (UK) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with UK adopted international accounting standards. The
condensed set of financial statements included in this half-yearly financial
report has been prepared in accordance with UK adopted International
Accounting Standard 34, "Interim Financial Reporting.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410, however future events or conditions may cause the Group to
cease to continue as a going concern.
Responsibilities of directors
The directors are responsible for preparing the half-yearly financial report
in accordance with the
Disclosure Guidance and Transparency Rules of the United Kingdom's Financial
Conduct Authority.
In preparing the half-yearly financial report, the directors are responsible
for assessing the Group's ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group
or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the review of the financial information
In reviewing the half-yearly report, we are responsible for expressing to the
Group a conclusion on the condensed set of financial statement in the
half-yearly financial report. Our conclusion, including our Conclusions
Relating to Going Concern, are based on procedures that are less extensive
than audit procedures, as described in the Basis for Conclusion paragraph of
this report.
Use of our report
Our report has been prepared in accordance with the terms of our engagement to
assist the Group in meeting the requirements of the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct Authority and for
no other purpose. No person is entitled to rely on this report unless such a
person is a person entitled to rely upon this report by virtue of and for the
purpose of our terms of engagement or has been expressly authorised to do so
by our prior written consent. Save as above, we do not accept responsibility
for this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
BDO LLP
Chartered Accountants
London, UK
01 March 2022
BDO LLP is a limited liability partnership registered in England and Wales
(with registered number OC305127).
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the six month period ended 31 December 2021
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
Profit or loss Note £' 000 £' 000 £' 000
Gross rental income 4 32,746 20,412 48,156
Service charge income 4 906 200 830
Service charge expense 5 (1,008) (204) (1,044)
Net Rental Income 32,644 20,408 47,942
Administrative and other expenses 6 (6,218) (4,065) (9,262)
Operating profit before changes in fair value of investment properties and 26,426 16,343 38,680
share of income from joint venture
Changes in fair value of investment properties and associated rent guarantees 12
10,967 15,462 36,288
Share of income from joint venture 13 37,214 4,906 15,506
Operating profit 74,607 36,711 90,474
Finance expense 8 (5,661) (3,746) (8,518)
Profit before taxation 68,946 32,965 81,956
Tax charge for the period 9 - - -
Profit for the period 68,946 32,965 81,956
Items to be classified to profit or loss in subsequent periods
Changes in the fair value of interest rate derivatives 20 2,232 (210) 1,569
Total comprehensive income for the period 71,178 32,755 83,525
Total comprehensive income for the period attributable 71,178 32,755 83,525
to ordinary shareholders
Earnings per share - basic and diluted (pence) 10 7.9p 5.9p 12.6p
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 December 2021
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
Note £' 000 £' 000 £' 000
Non-current assets
Property, plant and equipment 129 129 -
Investment properties 12 1,413,500 1,148,380 885,333
Investment in joint ventures 13 167,534 130,321 61,112
Contract fulfilment asset 85 85
Other financial assets 2,786 - -
Interest rate derivatives 17 2,124 763 -
Total non-current assets 1,586,158 1,279,678 946,445
Current assets
Financial assets held at fair value through profit and loss 14 98 237 478
Trade and other receivables 15 10,368 3,140 2,750
Cash and cash equivalents 24,070 19,579 61,936
Total current assets 34,536 22,956 65,164
Total assets 1,620,694 1,302,634 1,011,609
Non-current liabilities
Bank borrowings 18 478,031 409,684 301,163
Interest rate derivatives 17 344 1,210 2,213
Total non-current liabilities 478,375 410,894 303,376
Current liabilities
Deferred rental income 15,047 12,061 9,418
Trade and other payables 16 12,188 8,369 7,041
Total current liabilities 27,235 20,430 16,459
Total liabilities 505,610 431,324 319,835
Total net assets 1,115,084 871,310 691,774
Equity
Share capital 19 9,854 8,107 6,658
Share premium reserve 19 194,770 778,859 629,914
Cash flow hedge reserve 20 1,780 (452) (2,231)
Capital reduction reserve 19 778,859 - -
Retained earnings 129,821 84,796 57,433
Total equity 1,115,084 871,310 691,774
Net asset value per share - basic and diluted 23 113p 108p 104p
EPRA net tangible asset per share - 23 113p 108p 104p
basic and diluted
These unaudited condensed consolidated financial statements were approved and
authorised for issue by the Board of Directors on 01 March 2022 and were
signed on its behalf by: Nick Hewson, Chairman.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six month period ended 31 December 2021 (unaudited)
Share capital Share Cash Capital reduction reserve Retained Total
premium
flow hedge reserve
earnings
reserve
£' 000 £' 000 £' 000 £' 000 £' 000 £' 000
As at 1 July 2021 8,107 778,859 (452) - 84,796 871,310
Comprehensive income for
the period
Profit for the period - - - - 68,946 68,946
Other comprehensive income - - 2,232 - - 2,232
Total comprehensive income for - - 2,232 - 68,946 71,178
the period
Transactions with owners
Ordinary shares issued at a 1,747 199,188 - - - 200,935
premium during the period
Share issue costs - (4,418) - - - (4,418)
Transfer to capital reduction - (778,859) - 778,859 - -
reserve
Interim dividends paid - - - - (23,921) (23,921)
As at 31 December 2021 9,854 194,770 1,780 778,859 129,821 1,115,084
For the year from 1 July 2020 to 30 June 2021 (audited)
Share capital Share Cash Capital Retained earnings Total
premium
flow hedge
reserve reduction reserve
Reserve
£' 000 £' 000 £' 000 £' 000 £' 000 £' 000
As at 1 July 2020 4,735 436,126 (2,021) - 38,321 477,161
Comprehensive income for the year
Profit for the year - - - - 81,956 81,956
Other comprehensive income - - 1,569 - - 1,569
Total comprehensive income for - - 1,569 - 81,956 83,525
the year
Transactions with owners
Ordinary shares issued at a 3,372 350,132 - - - 353,504
premium during the year
Share issue costs - (7,399) - - - (7,399)
Interim dividends paid - - - - (35,481) (35,481)
As at 30 June 2021 8,107 778,859 (452) - 84,796 871,310
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six month period ended 31 December 2020 (unaudited)
Share capital Share Cash Capital reduction reserve Retained Total
premium
flow hedge reserve
earnings
reserve
£' 000 £' 000 £' 000 £' 000 £' 000 £' 000
As at 1 July 2020 4,735 436,126 (2,021) - 38,321 477,161
Comprehensive income for - - - - - -
the period
Profit for the period - - - - 32,965 32,965
Other comprehensive income - - (210) - - (210)
Total comprehensive income for - - (210) - 32,965 32,755
the period
Transactions with owners
Ordinary shares issued at a 1,923 198,077 - - - 200,000
premium during the period
Share issue costs - (4,289) - - - (4,289)
Interim dividends paid - - - - (13,853) (13,853)
As at 31 December 2020 6,658 629,914 (2,231) - 57,433 691,774
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
For the six month period ending 31 December 2021
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December 31 December 30 June
2021
2020
2021
Operating activities Notes £'000 £'000 £'000
Profit for the period (attributable to ordinary shareholders) 68,946 32,965 81,956
Adjustments for:
Changes in fair value of Investment properties and associated rent guarantees 12 (10,967) (15,462) (36,288)
Movement in rent smoothing adjustments 4 (1,209) (769) (1,998)
Finance expense 8 5,661 3,746 8,518
Share of income from Joint ventures 13 (37,214) (4,906) (15,506)
Cash flows from operating activities before changes in working capital
25,217 15,574 36,682
Increase in trade and other receivables (7,229) (1,048) (1,437)
(Decrease)/ Increase in rent guarantee receivables 14 (70) - 185
Increase in deferred rental income 2,986 4,215 6,858
Increase in trade and other payables 1,226 63 516
Cash flows from operating activities 22,130 18,804 42,804
Investing activities
Acquisition of contract fulfilment assets - - (85)
Acquisition of investment properties 12 (243,449) (313,973) (541,210)
Acquisition of financial assets held at fair value through profit and loss 14 - (478) (766)
Increase in other financial assets (2,786)
Investment in Joint venture 13 - (125) (58,734)
Capitalised acquisition costs (7,146) (15,718) (28,752)
Net cash flows used in investing activities (253,381) (330,294) (629,547)
Financing activities
Proceeds from issue of ordinary share capital 19 200,000 200,000 352,956
Costs of share issues 19 (4,418) (4,289) (7,399)
Bank borrowings drawn 256,407 327,602 582,961
Bank borrowings repaid (187,971) (151,790) (298,300)
Loan arrangement fees paid (1,096) (2,085) (3,211)
Bank interest paid (3,884) (2,365) (5,578)
Bank commitment fees paid (310) (147) (527)
Dividends paid to equity holders (22,986) (13,853) (34,933)
Net cash flows from financing activities 235,742 353,073 585,969
Net increase / (decrease) in cash and cash equivalents for the period 4,491 41,583 (774)
Cash and cash equivalents at the beginning of the period 19,579 20,353 20,353
Cash and cash equivalents at the end of the period 24,070 61,936 19,579
1. Basis of preparation
General information
Supermarket Income REIT plc (the "Company" or "Group") is a company registered
in England and Wales with its registered office at The Scalpel 18(th) Floor,
52 Lime Street, London, United Kingdom EC3M 7AF. The principal activity of the
Company and its subsidiaries (the "Group") is to provide its shareholders with
an attractive level of income together with the potential for capital growth
by investing in a diversified portfolio of supermarket real estate assets in
the UK.
The financial information set out in this report covers the six months to 31
December 2021, with comparative numbers amounts shown for the year to 30 June
2021 and the six months to 31 December 2020. These condensed financial
statements are unaudited and the financial information for the year ended 2020
contained herein does not constitute statutory accounts for as defined in
section 434 of the Companies Act 2006. The statutory accounts for the year
ended 30 June 2021 have been delivered to the Registrar of Companies. The
independent auditors' report on those accounts was unqualified, did not draw
attention to any matters by way of emphasis, and did not contain a statement
under sections 498(2) or 498(3) of the Companies Act 2006.
At 31 December 2021 the Group comprised of the Company and its wholly-owned
subsidiaries. The Company has one subsidiary incorporated in Jersey, the
registered office is 28 Esplanade, St Helier, Jersey JE2 3QA. All other
subsidiaries are incorporated in England and Wales and have the same
registered office as the Company.
The condensed consolidated financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting' as adopted by the United
Kingdom. The accounting policies adopted in this report are consistent with
those applied in the Group's audited financial statements for the year ended
30 June 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 June 2022.
Accounting convention and currency
The condensed consolidated financial statements ("the financial statements")
have been prepared on a historical cost basis, except that investment
properties, rental guarantees and interest rate derivatives are measured at
fair value.
The financial statements are presented in Pounds Sterling and all values are
rounded to the nearest thousand (£'000), except where otherwise indicated.
Pounds Sterling is the functional currency of the Group and the presentation
currency of the Group.
The Directors are of the opinion that the Group is currently engaged in a
single segment business, being investment in United Kingdom in supermarket
property assets.
Going concern
In assessing the going concern basis of accounting the Directors have had
regard to the guidance issued by the Financial Reporting Council.
The Group generated net cash flow from operating activities in the period of
£22.1 million, with cash balances at
31 December 2021 totalling £24.1 million and the Group had further amounts
available for drawdown under the loan facilities with Wells Fargo and
Barclays/ RBC as enacted after the period end. It had no capital commitments
or contingent liabilities as at that date. There has been no significant
deterioration in this position since the balance sheet date.
The Group benefits from a secure income stream from its property assets that
are let to tenants with excellent covenant strength under long leases that are
subject to upward only rent reviews.
1. Basis of preparation (continued)
As a result, the Directors believe that the Group is well placed to manage its
financing and other business risks and that the Group will remain viable,
continuing to operate and meet its liabilities as they fall due. The Directors
are therefore of the opinion that the going concern basis adopted in the
preparation of the financial statements is appropriate.
2. Significant accounting judgements, estimates and assumptions
There have been no new or material revisions to the nature and amount of
judgements and estimates reported in the Annual Report 2021, other than
changes to certain assumptions applied in the valuation of properties. Details
of the key assumptions applied at 31 December 2021 are set out in note 12.
3. Summary of significant accounting policies
The principal accounting policies adopted in this report are consistent with
those applied in the Group's audited financial statements for the year ended
30 June 2021 and are expected to be consistently applied during the year
ending 30 June 2022.
3.1 New standards issued and effective
There were a number of new standards and amendments to existing standards
which are required for the Group's accounting period beginning on 1 July 2021,
which have been considered as follows:
The Interest Rate Benchmark Reform - IBOR 'phase 2' amendments to IFRS 9, IAS
39, IFRS 7, IFRS 4 and IFRS 16 provides a practical expedient to account for
changes in the basis for determining contractual cash flows of financial
assets and financial liabilities as a result of IBOR reform. Under the
practical expedient, the Group accounted for the benchmark change from LIBOR
to SONIA on hedged cash flows by updating the effective interest rate using
the guidance in paragraph B5.4.5 of IFRS 9 without the recognition of an
immediate gain or loss.
The Group has also considered other amendments to standards endorsed by the
United Kingdom effective for the current accounting period and determined that
these do not have a material impact on the consolidated financial statements
of the Group in the period ended 31 December 2021.
3.2 New standards issued but not yet effective
Amendments to IAS 1 on Classification of liabilities as Current or Non-Current
are effective for the financial years
commencing on or after 1 January 2023 and are to be applied retrospectively.
It is not expected that the amendments may have an impact on the presentation
and classification of liabilities in the Group Statement of Financial Position
based on rights that are in existence at the end of the reporting period.
A number of new standards and amendments to standards and interpretations have
been issued but are not yet effective for the current accounting period. None
of these are expected to have a material impact on the consolidated financial
statements of the Group.
4. Gross rental income
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Rental income - freehold property 20,832 11,673 29,679
Rental income - long lease hold property 11,833 8,739 18,477
Surrender premiums 81 - -
Gross rental income 32,746 20,412 48,156
4. Gross rental income (continued)
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Property insurance recoverable 177 80 251
Service charge recoverable 729 120 579
Total property insurance and service charge income 906 200 830
Total property income 33,652 20,612 48,986
Included within rental income is a £1,209,000 (six months to 31 December
2020: £769,000; year to 30 June 2021: £1,998,000) rent smoothing adjustment
that arises as a result of IFRS 16 'Leases' requiring that rental income in
respect of leases with rents increasing by a fixed percentage be accounted for
on straight-line basis over the lease term. During the year this resulted in
an increase in rental income and an offsetting entry being recognised in
profit or loss as an adjustment to the investment property revaluation.
On an annualised basis, rental income comprises £31,000,000 relating to the
Group's largest tenant and £23,000,000 relating to the Group's second largest
tenant. There were no further tenants representing more than 10% of annualised
gross rental income during either year.
5. Service charge expense
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Property insurance expenses 248 81 379
Service charge expenses 760 123 665
Total property insurance and service charge expenses 1,008 204 1,044
6. Administrative and other expenses
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Investment Adviser fees (note 22) 4,300 2,718 6,255
Directors' remuneration (note 7) 134 130 260
Corporate administration fees 414 276 676
Legal and professional fees 842 515 916
Other administrative expenses 528 426 1,155
Total administrative and other expenses 6,218 4,065 9,262
7. Directors' remuneration
The Group has no employees. The Directors, who are the key management
personnel of the Group, are appointed under letters of appointment for
services. Directors' remuneration, all of which represents fees for services
provided, was as follows:
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Directors' fees 120 120 240
Employer's National Insurance Contribution 14 10 20
Total Directors' remuneration 134 130 260
8. Finance Expense
Unaudited Unaudited Audited
Six months to
31 December Six months to Year to
31 December
30 June
2021
2020 2021
£' 000 £' 000 £' 000
Interest payable on bank borrowings and hedging arrangements 3,928 2,508 5,810
Fair value adjustment of interest rate derivatives (note 17) 326 342 706
Commitment fees payable on bank borrowings 465 235 532
Amortisation of loan arrangement fees 937 647 1,442
Amortisation of interest rate cap premium (note 17) 5 14 28
Total finance expense 5,661 3,746 8,518
The above finance expense includes the following in respect of liabilities not
classified as fair value through profit
or loss:
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Total interest expense on financial liabilities held 4,864 3,155 7,252
at amortised cost
Fee expense not part of effective interest rate 465 235 532
for financial liabilities held at amortised cost
Total finance expense 5,329 3,390 7,784
9. Taxation
a) Tax charge in profit or loss
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020
2021
£' 000 £' 000 £' 000
Corporation tax - - -
9. Taxation (continued)
b) Total tax expense
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020
2021
£' 000 £' 000 £' 000
Tax charge in profit and loss as per the above - - -
Share of tax expense of equity accounted joint ventures 421 219 511
Total tax expense 421 219 511
The Company and its subsidiaries operate as a UK Group REIT. Subject to
continuing compliance with certain rules, the UK REIT rules exempt the profits
of the Group's property rental business from UK corporation tax. To operate as
a UK Group REIT a number of conditions had to be satisfied in respect of the
Company, the Group's qualifying activity and the Group's balance of business.
Since 21 December 2017 the Group has met all such applicable conditions.
The reconciliation of the profit before tax multiplied by the standard rate of
corporation tax for the period of 19% to the total tax charge is as follows:
c) Reconciliation of the tax charge for the period
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Profit on ordinary activities before taxation 68,946 32,965 81,956
Theoretical tax at UK standard corporation tax rate of 19% 13,100 6,263 15,572
Effects of:
Investment property revaluation not subject to taxation (2,084) (2,938) (6,895)
REIT exempt income (11,016) (3,325) (8,677)
Share of tax expense of equity accounted joint ventures 421 219 511
Total tax expense for the period 421 219 511
10. Earnings per share
Earnings per share (EPS) amounts are calculated by dividing the profit or loss
for the period attributable to ordinary equity holders of the Company by the
weighted average number of ordinary shares in issue during the period. As
there are no dilutive instruments outstanding, basic and diluted earnings per
share are identical.
The European Public Real Estate Association ('EPRA') publishes guidelines for
calculating adjusted earnings on a comparable basis. EPRA EPS is a measure of
EPS designed by EPRA to enable entities to present underlying earnings from
core operating activities, which excludes fair value movements on investment
properties.
10. Earnings per share (continued)
The calculation of basic, diluted and EPRA EPS is as follows:
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Net profit attributable to ordinary shareholders 68,946 32,965 81,956
EPRA adjustments:
Changes in fair value of investment properties (10,967) (15,462) (36,288)
and rent guarantees
Group share of negative goodwill from joint venture investment - - (3,265)
Group share of changes in fair value of joint venture investment properties (31,048) (1,975) (5,619)
EPRA earnings 26,931 15,528 36,784
Number(1) Number(1) Number(1)
Weighted average number of ordinary shares 878,171,925 561,413,104 652,828,945
(1) Based on the weighted average number of ordinary shares in issue
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
Pence per share Pence per share Pence per share
Basic and Diluted EPS 7.9p 5.9p 12.6p
EPRA adjustments:
Changes in fair value of investment properties (1.3)p (2.8)p (5.6)p
and rent guarantees
Group share of negative goodwill from joint venture investment - - (0.5)p
Group share of changes in fair value of joint venture investment properties (3.5)p (0.3)p (0.9)p
EPRA EPS 3.1p 2.8p 5.6p
11. Dividends
Unaudited Unaudited Audited
Year to
Six months to Six months to
30 June
31 December
31 December
2021
2021 2020
£' 000 £' 000 £' 000
Distributions to ordinary shareholders in the period:
Dividends paid 23,921 13,853 35,481
11. Dividends (continued)
On 8 July 2021, the Board declared a fourth interim dividend for the year
ended 30 June 2021 of 1.465 pence per share, which was paid on 7 August 2021
to shareholders on the register on 16 July 2021.
On 23 September 2021 the Board declared a first interim dividend for the year
ending 30 June 2022 of 1.485 pence per share, which was paid on 16 November
2021 to shareholders on the register on 8 October 2021.
On 10 January 2022, the Board declared a second interim dividend for the year
ending 30 June 2022 of 1.485 pence per share, which was paid on 25 February
2022 to shareholders on the register on 21 January 2022. This has not been
included as a liability as at 31 December 2021.
12. Investment Properties
In accordance with IAS 40 'Investment Property', the Group's investment
properties have been independently valued at fair value by Cushman &
Wakefield, an accredited independent valuer with a recognised and relevant
professional qualification and with recent experience in the locations and
categories of the investment properties being valued. The valuations have been
prepared in accordance with the RICS Valuation - Global Standards (the 'Red
Book') and incorporate the recommendations of the International Valuation
Standards Committee which are consistent with the principles set out in IFRS
13.
The independent valuer in forming its opinion on valuation makes a series of
assumptions. All the valuations of the Group's investment property at 31
December 2021 are classified as 'level 3' in the fair value hierarchy defined
in IFRS 13. The valuations are ultimately the responsibility of the Directors.
Accordingly, the critical assumptions used in establishing the independent
valuation are reviewed by the Board.
Freehold Long Leasehold Total
£' 000 £' 000 £' 000
At 1 July 2021 723,540 424,840 1,148,380
Property additions 96,182 147,267 243,449
Capitalised acquisition costs 3,629 5,657 9,286
Revaluation movement 18,339 (5,954) 12,385
Valuation at 31 December 2021 841,690 571,810 1,413,500
Freehold Long Leasehold Total
£' 000 £' 000 £' 000
At 1 July 2020 244,030 295,380 539,410
Property additions 438,710 102,500 541,210
Capitalised acquisition costs 23,331 5,799 29,130
Revaluation movement 17,469 21,161 38,630
Valuation at 30 June 2021 723,540 424,840 1,148,380
Freehold Long Leasehold Total
£' 000 £' 000 £' 000
At 1 July 2020 244,030 295,380 539,410
Property additions 274,502 39,471 313,973
Capitalised acquisition costs 13,491 2,227 15,718
Revaluation movement 949 15,283 16,231
Valuation at 31 December 2020 532,972 352,361 885,333
12. Investment Properties (continued)
Of the ten properties held under long leaseholds, the years unexpired on the
headleases are as follows: four properties with between 117 and 157 years, and
six properties with between 984 and 989 years. The Group has no material
liabilities in respect of these headleases.
Included within the carrying values of investment properties at 31 December
2021 is £4,767,000 (six months to
31 December 2020: £2,329,000, year to 30 June 2021: £3,558,000) in respect
of the smoothing of fixed contractual rent uplifts as described in note 4. The
difference between rents on a straight-line basis and rents actually
receivable is included within the carrying value of the investment properties
but does not increase that carrying value over fair value. The effect of this
adjustment on the revaluation movement for the period is as follows:
Unaudited Unaudited Audited
Year to
Six months to Six months to
30 June
31 December
31 December
2021
2021 2020
£' 000 £' 000 £' 000
Revaluation movement per above 12,385 16,232 38,630
Rent smoothing adjustment (note 4) (1,209) (769) (1,998)
Movements in associated rent guarantees (note 14) (209) - (344)
Change in fair value recognised in profit or loss 10,967 15,462 36,288
Valuation techniques and key unobservable inputs
Valuation techniques used to derive fair values
The valuations have been prepared on the basis of market value which is
defined in the RICS Valuation Standards as 'the estimated amount for which an
asset or liability should exchange on the date of the valuation between a
willing buyer and a willing seller in an arm's length transaction after proper
marketing wherein the parties had each acted knowledgeably, prudently and
without compulsion'. Market value as defined in the RICS Valuation Standards
is the equivalent of fair value under IFRS.
Unobservable inputs
Significant unobservable inputs include: the estimated rental value ("ERV")
based on market conditions prevailing at the valuation date and the equivalent
yield (defined as the weighted average of the net initial yield and
reversionary yield). Other unobservable inputs include but are not limited to
the future rental growth - the estimated average increase in rent based on
both market estimations and contractual situations and the physical condition
of the individual properties determined by inspection.
A decrease in ERV would decrease fair value. A decrease in the equivalent
yield would increase the fair value.
Sensitivity of measurement of significant unobservable inputs
The determination of the valuation of the Group's investment property
portfolio is open to judgements and is inherently subjective by nature.
Sensitivity analysis - impact of changes in initial yields and passing rent
Initial yields of the Group's investment properties at 31 December 2021 range
from 3.8% to 6.6% (year ended
30 June 2021: 3.9% to 6.2%; six months ended 31 December 2020: 4.2% to
6.1%). Rental values (being passing rents or ERV as relevant) on the Group's
investment properties at 31 December 2021 range from £0.3m to £4.8 million
(year ended 30 June 2021: £0.4 million to £4.8 million; six months ended 31
December 2020: £0.4 million to
£4.1 million).
12. Investment Properties (continued)
The table below analyses the sensitivity on the fair value of investment
properties for changes in rental values and net initial yields:
+1% -1% +0.25% -0.25%
Rental
Rental
value
value Net Initial Net Initial
Yield
Yield
£m £m
£m £m
(Decrease)/increase in the fair value of investment properties as at 31 14.1 (14.1) (72.3) 81.9
December 2021
(Decrease)/increase in the fair value of investment properties as at 31 8.9 (8.9) (44.7) 49.8
December 2020
(Decrease)/increase in the fair value of investment properties as at 30 June 11.5 (11.5) (58.8) 65.6
2021
13. Investment in joint ventures
As at 31 December 2021 the Group has one joint venture investment. On the 28
May 2020, the Group entered into a 50:50 joint venture with the British
Airways Pension Trustees Limited to acquire 100% of the issued share capital
in Horndrift Limited for a combined total consideration of £102.0m plus
costs.
On the 17 February 2021, the joint venture also acquired 100% of the issued
share capital in Cornerford Limited for a combined total consideration of
£115m plus costs.
Horndrift and Cornerford Limited each hold a 25.2% share of certain beneficial
interests in a property trust arrangement that holds a portfolio of 26
Sainsbury's supermarket properties funded by bonds which mature in 2023 (the
"Structure"). Rental surpluses generated by the Structure are required to be
applied in the repayment of the bonds and not therefore capable of being
transferred to the joint venture or Group until those bonds have
been repaid.
The Group deems this to be a joint venture, as through the Group's interest in
Horndrift Limited and Cornerford Limited it indirectly has joint control of
the structure.
Under the terms of the Horner (Jersey) LP (the "JV") Limited Partnership
Agreement ("LPA"), an affiliate of the Investment Adviser, Atrato Halliwell
Limited (the "Carry Partner"), has a carried interest entitlement over the
investment returns from the JV's investment in the Structure. Under the terms
of the LPA, once the Group and its JV partner have received a return equal to
their total investment in the JV plus an amount equivalent to a 10% per annum
preferred return on that investment, the Carry Partner is entitled to share in
any further cash returns to be distributed by the JV.
The Carry Partner's entitlement to share in cash returns in excess of the
preferred return increases depending on the extent of those cash returns, up
to a capped maximum entitlement. The Group has estimated the value of the
Carry Partner's interest in the Group's share of the JV as at 31
December 2021 to be £7,500,000 (six months to 31 December 2020: £nil, 30
June 2021 £2,200,000) which is the Group's maximum share under the capped
entitlement. This has been determined by reference to the expected returns
from the JV's investment in the Structure, assuming that the proceeds realised
from the future sale of the properties held by within the Structure are equal
to the independent valuations of those properties as at 31 December 2021.
Accordingly, the Group's beneficial interest in the JV, and therefore the
Group's share of the JV's net assets as at 31 December 2021, is estimated to
amount to 47.9%.
The carried interest payments are only payable upon cash distributions from
the JV to the Group. To date there
have been no cash distributions received by the Group and therefore no carried
interest payment has yet
become payable.
13. Investment in joint ventures (continued)
Partner Address Ownership
Jersey
Horner (Jersey) LP British Airways Pensions Third Floor, Liberation House, Castle Street, St Helier, Jersey, JE1 2LH 50% owned by the Group
parent company
Trustees Limited
Horner REIT Limited
Third Floor, Liberation House, Castle Street, St Helier, Jersey, JE1 2LH 100% owned by Horner (Jersey) LP
parent company
United Kingdom
Horndrift Limited Langham Hall UK LLP, 1 Fleet Street, London, E4M 7RA 100% owned by Horner REIT Limited
Cornerford Limited
Langham Hall UK LLP, 1 Fleet Street, London, E4M 7RA 100% owned by Horner REIT Limited
Unaudited Unaudited Audited
Six months to Six months to Year to
31 December
31 December
30 June
2021 2020 2021
£' 000 £' 000 £' 000
Opening balance 130,320 56,081 56,081
Additions - 125 58,734
Group's share of profit after tax 37,214 4,906 15,506
Closing balance 167,534 61,112 130,321
The joint venture entities have a 31 March year end. For accounting purposes
consolidated management accounts have been prepared for the joint venture for
the period from 1 July to 31 December 2021 using accounting policies that are
consistent with those of the Group.
13. Investment in joint ventures (continued)
The financial statements of Horner (Jersey) LP prepared on this basis would be
as follows:
Statement of comprehensive income Unaudited Unaudited Audited
Year to
Six months to Six months to
30 June
31 December
31 December
2021
2021 2020
£'000
£'000 £'000
Share of income from joint venture 84,748 9,812 28,885
Negative Goodwill - - 6,530
Profit for the period and total comprehensive income
84,748 9,812 35,415
Group's share of profit for the period 37,214 4,906 15,506
Statement of financial position Unaudited 31 December Unaudited Audited
2021 31 December 30 June
£'000 2020 2021
£'000 £'000
Investment in joint ventures 350,069 122,223 265,045
Net assets 350,069 122,223 265,045
Group's share of net assets 167,534 61,112 130,320
Horner (Jersey) LP's share of the aggregate amounts recognised in the
consolidated statement of comprehensive income and statement of financial
position of the Structure are as follows:
Unaudited Unaudited Audited
Year to
Six months to Six months to
30 June
31 December 31 December 2021
2021
2020
£'000
£'000 £'000
Rental income 14,986 7,283 19,886
Administrative and other expenses (99) (383) (585)
Change in fair value of investment properties 72,693 4,376 13,259
Operating profit 87,580 11,275 32,560
Finance expense (1,869) (1,022) (2,470)
Profit before taxation 85,710 10,253 30,090
Tax charge for the period (962) (441) (1,205)
Profit for the period 84,748 9,812 28,885
13. Investment in joint ventures (continued)
Unaudited Unaudited Audited
31 December
31 December 30 June
2021
Non-current assets
2020 2021
£'000
£'000 £'000
Investment properties 555,925 233,088 477,447
Total non-current assets 555,925 233,088 447,447
Current assets
Trade and other receivables 18,220 8,758 15,163
Cash and cash equivalents - - -
Total current assets 18,220 8,758 15,1562
Total assets 574,145 241,846 492,610
Non-current liabilities
Debt securities in issue 187,133 99,423 190,788
Interest rate derivative 6,849 5,547 8,836
Deferred tax 11,321 5,787 11,048
Other liabilities 10,039 4,536 9,188
Total non-current liabilities 215,342 115,293 219,860
Current liabilities
Trade and other payables 8,733 4,330 7,705
Total current liabilities 8,733 4,330 7,705
Total liabilities 224,075 119,623 227,565
Net assets 350,070 122,223 265,045
14. Financial assets held at fair value through profit or loss
Rental guarantees provided by the seller of an investment property are
recognised as a financial asset when there is a valid expectation that the
Group will utilise the guarantee over the contractual term. Rental guarantees
are classified as financial assets at fair value through profit and loss in
accordance with IFRS 9.
In determining the fair value of the rental guarantee, the Group makes an
assessment of the expected future cashflows to be derived over the term of the
rental guarantee and discounted these at the market rate. A review is
performed on a periodic basis based on payments received and changes in the
estimation of future cashflows.
The fair value of rental guarantees held by the Group as at the period end
date are as follows:
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
£' 000 £' 000 £' 000
At start of period 237 - -
Additions - 766 478
Fair value changes (including changes in estimated cash flows) (209) (344) -
Payments (received)/refunded 70 (185) -
At end of period 98 237 478
The fair value of rental guarantees recognised have a contractual expiry of
less than next twelve months.
15. Trade and other receivables
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
£' 000 £' 000 £' 000
Trade and other receivables 9,531 2,624 2,436
Prepayments 837 516 314
Total trade and other receivables 10,368 3,140 2,750
The Group applies the IFRS 9 simplified approach to measuring expected credit
losses using a lifetime expected credit loss provision for trade receivables.
To measure expected credit losses on a collective basis, trade receivables are
grouped based on similar credit risk and ageing. The expected loss rates are
based on the Group's historical credit losses experienced over the period from
incorporation to 31 December 2021. The historical loss rates are then adjusted
for current and forward-looking information on macroeconomic factors affecting
the Group's customers. Both the expected credit loss provision and the
incurred loss provision in the current and prior year are immaterial. No
reasonable possible changes in the assumptions underpinning the expected
credit loss provision would give rise to a material expected credit loss.
16. Trade and other payables
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
£' 000 £' 000 £' 000
Corporate accruals 9,607 6,153 5,256
VAT payable 2,581 2,216 1,785
Total trade and other payables 12,188 8,369 7,041
17. Interest rate derivatives
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
£' 000 £' 000 £' 000
Non-current asset: Interest rate swaps 2,124 763 -
Non-current liability: Interest rate swap (344) (1,210) (2,213)
The interest rate cap and interest rate swap is remeasured to fair value by
the counterparty bank on a quarterly basis.
The fair value at the end of the period comprises: Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
At start of the period (447) (1,988) (1,988)
Amortisation of cap premium in the period (note 8) (5) (28) (14)
Changes in fair value of interest rate derivative in the period 1,906 863 (553)
Charge to the income statement 326 706 342
As at the end of the period 1,780 (447) (2,213)
To partially mitigate the interest rate risk that arises as a result of
entering into the floating rate debt facilities referred to in note 18, the
Group has entered into derivative interest rate swaps in relation to the loan
facilities with Bayerische Landesbank ('the BLB swaps') and Wells Fargo Bank
('the Wells swaps').
As disclosed in note 1, the Group has adopted Interest Rate Benchmark Reform -
IBOR 'phase 2'. The amendments provide relief in applying the requirements of
IFRS 9 to certain hedges, including allowing the Group to assume the amounts
accumulated in the cash flow hedge reserve are based on the alternative
benchmark rate (i.e SONIA) on which the hedged future cash flows are
determined.
The total notional value of the BLB swaps was £86.9 million, which is equal
to the total amounts drawn under Bayerische Landesbank loan facility. The
terms of the BLB swaps coincide with the maturity of the respective Bayerische
Landesbank loan facility. The fixed interest rate of £52.1 million of the
swap exposure as at 31 December 2021 was 1.305%. The fixed interest rate of
the swaps of £27.5 and £7.3m for the remaining exposure of
£34.8 million were 0.178% and 0.128% respectively.
The total notional value of the Wells swap was £30.0 million with its term
coinciding with the maturity of the Wells Fargo loan facility. The fixed
interest rate of the swap as at 31 December 2021 was 0.189%.
44% of the Group's variable rate debt was hedged as at 31 December 2021 (30
June 2021: 54%; 31 December 2020: 79%). It is the Group's target to hedge on
an annualised basis, at least 60% of the Group's total using interest
rate derivatives.
17. Interest rate derivatives (continued)
The derivatives have been valued in accordance with IFRS 13 by reference to
interbank bid market rates as at the close of business on the last working day
prior to each balance sheet date. The fair values are calculated using the
present values of future cash flows, based on market forecasts of interest
rates and adjusted for the credit risk of the counterparties. The amounts and
timing of future cash flows are projected on the basis of the contractual
terms.
All interest rate derivatives are classified as level 2 in the fair value
hierarchy as defined under IFRS 13 and there were no transfers to or from
other levels of the fair value hierarchy during the year.
In accordance with the Group's treasury risk policy, the Group applies cash
flow hedge accounting in partially hedging the interest rate risks arising on
its variable rate linked loans. Changes in the fair values of derivatives that
are designated as cash flow hedges and are effective are recognised directly
in the cash flow hedge reserve and included in other comprehensive income.
Any ineffectiveness that may arise in this hedge relationship will be included
in profit or loss.
18. Bank borrowings
Unaudited Audited Unaudited
31 December 30 June 31 December
2021 2021 2020
£' 000 £' 000 £' 000
Amounts falling due after more than one year:
Secured debt 481,826 413,320 304,473
Less: Unamortised finance costs (3,795) (3,636) (3,310)
Bank borrowing per consolidated statement of financial position 478,031 409,684 301,163
The Group has a secured revolving credit facility (the 'credit facility') of
£150 million with HSBC Bank Plc, a five year interest-only loan secured
facility ('the BLB loan facility') of £86.9 million with Bayerische
Landesbank, a five year fixed rate secured loan facility ('the Deka loan
facility') of £96.6 million with Deka Bank, a seven year secured revolving
credit facility (the 'Wells Fargo Credit facility') of £121.3 million with
Wells Fargo and a five year secured revolving credit facility (the
'Barclays/RBC credit facility') of £113.8 million with Barclays and Royal
Bank of Canada.
As disclosed in note 1, the Group has adopted Interest Rate Benchmark Reform -
IBOR 'phase 2'. Applying the practical expedient introduced by the amendments,
when the benchmarks affecting the credit facility and the BLB loan facility
were transitioned from LIBOR to SONIA the adjustments to the contractual cash
flows have been reflected as an adjustment to the effective interest rate.
Therefore, the replacement of the loans' benchmark interest rate has not
result in an immediate gain or loss recorded in profit or loss.
Each of the Group's facilities impacted by the changes resulting from interest
rate benchmark reform transitioned during the period and the Group does not
consider that the transition from LIBOR to SONIA within the Group's floating
rate facilities gives rise to a significant change in market risk.
At 31 December 2021, £77.4 million has been drawn down under the credit
facility. Interest is payable quarterly on the loan facility based on a margin
of 1.65% over SONIA on the first £100.0 million of the facility and a margin
of 1.75% above SONIA on the remaining £50.0 million of the facility.
18. Bank borrowings (continued)
At 31 December 2021, the full amount of the BLB loan facility had been drawn
down. Interest is payable quarterly on the BLB loan facility based on a margin
of 1.37% above SONIA for the initial £52.1 million and 1.97% above SONIA for
the remaining £34.8 million. The fixed interest rate on the BLB loan facility
resulting from the interest rate swaps were 2.56% on the £52.1 million swap,
2.03% on the £27.5 million swap and 1.98% on the £7.3 million swap.
At 31 December 2021, the full £96.6 million of the Deka loan facility had
been drawn down. £76.56 million of
the Deka loan facility has a weighted average fixed interest rate of 1.95%.
In August 2021, the Group increased
the Deka loan facility by a further £20.0 million to £96.6 million at a
fixed interest rate of 1.72%. All other terms remained unchanged.
As at 31 December 2021, £107.2 million had been drawn under the Wells Fargo
Credit facility. Interest is payable quarterly on the Wells Fargo Credit
facility based on a margin of 2.11% above SONIA on the first £60.0 million of
the facility. In September 2021, the Group exercised its accordion option to
increase this facility by a further £61.3 million
at a price of 1.40% above SONIA. The weighted average interest rate on Wells
Fargo Credit facility resulting from the interest rate swap was 1.80%.
As at 31 December 2021, the full £113.8 million of the Barclays/RBC credit
facility has been drawn down. Interest is payable quarterly on the loan
facility based on a margin of 1.50% above SONIA. In January 2022, the Group
increased its Revolving Credit Facility with Barclays and Royal Bank of Canada
by a further £136.5 million, bringing the total size of the facility to
£250.2 million with a further £49.8 million uncommitted accordion option.
The Group has been in compliance with all of the financial covenants across
the Group's bank facilities as applicable throughout the periods covered by
these financial statements.
Any associated fees in arranging the bank borrowings that are unamortised as
at the end of the period are offset against amounts drawn under the facilities
as shown in the table above. The debt is secured by charges over the Group's
investment properties and by charges over the shares of certain group
companies, not including the Company itself. There have been no defaults of
breaches of any loan covenants during the current or any prior period.
The Group's borrowings carried at amortised cost are considered to be
approximate to their fair value.
19. Share capital
Ordinary shares Share Share premium reserve Capital Total
reduction
of 1 pence capital
reserve
Six months to 31 December 2021 (unaudited) Number £'000 £'000 £'000 £'000
As at 1 July 2021 810,720,168 8,107 778,859 - 786,966
Scrip dividends issued and fully paid 300,468 3 349 - 352
- 20 August 2021
Ordinary shares issued and fully paid 173,913,043 1,739 198,261 - 200,000
- 22 October 2021
Scrip dividends issued and fully paid 500,750 5 578 - 583
- 16 November 2021
Transfer to capital reduction reserve (778,859) 778,859 -
Share issue costs - - (4,418) - (4,418)
As at 31 December 2021 985,434,429 9,854 194,770 778,859 983,483
19. Share capital (continued)
Share premium reserve Total
Ordinary shares Capital
reduction
of 1 pence Share
reserve
capital
Year to 30 June 2021 (audited) Number £'000 £'000 £'000 £'000
As at 1 July 2020 473,620,462 4,735 436,126 - 440,861
Ordinary shares issued and fully paid 192,307,692 1,923 198,077 - 200,000
- 9 October 2020
Scrip dividends issued and fully paid 124,795 2 132 - 134
- 26 February 2021
Ordinary shares issued and fully paid 144,297,503 1,443 151,513 - 152,956
- 23 March 2021
Scrip dividends issued and fully paid 369,716 4 410 - 414
- 21 May 2021
Share issue costs - - (7,399) - (7,399)
As at 30 June 2021 810,720,168 8,107 778,859 - 786,966
Ordinary shares Share Share premium reserve Capital Total
reduction
of 1 pence capital
reserve
Six months to 31 December 2020 (unaudited) Number £'000 £'000 £'000 £'000
As at 1 July 2020 473,620,462 4,735 436,126 - 440,861
Ordinary shares issued and fully paid 192,307,692 1,923 198,077 - 200,000
- 9 October 2020
Share issue costs - - (4,289) - (4,289)
Dividend paid in the period (note 10) - - - -
As at 31 December 2020 665,928,154 6,658 629,914 - 636,572
On 22 October 2021 the Company completed an equity fundraising and issued an
additional 173,913,043 ordinary shares of one pence each at a price of £1.15
per share. The consideration received in excess of the par value of
the ordinary shares issues, net of total capitalised issue costs, of £193.8
million was credited to the share
premium reserve.
Following a successful application to the High Court and lodgement of the
Company's statement of capital with the Registrar of Companies, the Company
was permitted to reduce the capital of the Company by an amount of £778.9
million. This was effected on 15 December 2021 by a transfer of that amount
from the share premium reserve to the capital reduction reserve. The capital
reduction reserve is classed as a distributable reserve.
Scrip dividends were issued on 20 August 2021 and 16 November 2021 at a
reference price of £1.17 and £1.16 per share respectively. The Company
issued a combined total of 801,218 shares under the scrip dividend programme
during the year. The consideration received in excess of the par value of the
ordinary shares issued, of £0.9 million was credited to the share premium
reserve.
Ordinary shareholders are entitled to all dividends declared by the Company
and to all of the Company's assets after repayment of its borrowings and
ordinary creditors. Ordinary shareholders have the right to vote at meetings
of the Company. All ordinary shares carry equal voting rights.
20. Cash flow hedge reserve
Unaudited Audited Unaudited
Six months to Year to Six months to
31 December
30 June
31 December
2021 2021 2020
£' 000 £' 000 £' 000
At start of the period (452) (2,231) (2,021)
Fair value movement of interest rate derivatives in effective hedges 2,232 1,779 (210)
At the end of the period 1,780 (452) (2,231)
21. Capital commitments
The Group had no capital commitments outstanding as at 31 December 2021 (30
June 2021: none; 31 December 2020: none).
22. Transactions with related parties
Details of the related parties to the Group in the period and the transactions
with these related parties were
as follows:
a. Directors
Directors' fees
Nick Hewson, Chairman of the Board of Directors of the Company, is paid fees
of £70,000 per annum, with the other Directors each being paid fees of
£50,000 per annum. Jon Austen is paid an additional £7,500 per annum for his
role as chair of the Company's Audit Committee, Vince Prior is paid an
additional £2,500 per annum for his role as chair of the Company's
Nominations Committee and £5,000 for his role as Senior Independent Director.
Cathryn Vanderspar is paid an additional £5,000 for her role as Chair of the
Remuneration Committee.
Directors' interests
Details of the direct and indirect interests of the Directors and their close
families in the ordinary shares of one pence each in the Company at 31
December 2021 were as follows:
· Nick Hewson: 614,563 shares (0.06% of issued share capital)
· Jon Austen: 230,193 shares (0.02% of issued share capital)
· Vince Prior: 134,886 shares (0.01% of issued share capital)
· Cathryn Vanderspar: 75,210 shares (0.01% of issued share capital)
b. Investment Adviser
Investment advisory and accounting fees
The investment adviser to the Group, Atrato Capital Limited (the 'Investment
Adviser'), is entitled to certain advisory fees under the terms of the
Investment Advisory Agreement (the 'Agreement') dated 14 July 2021.
The entitlement of the Investment Adviser to advisory fees is by way of what
are termed 'Monthly Management Fees' and 'Semi-Annual Management Fees' both of
which are calculated by reference to the net asset value of the Group at
particular dates, as adjusted for the financial impact of certain investment
events and after deducting any un-invested proceeds from share issues up to
the date of the calculation of the relevant fee (these adjusted amounts are
referred to as 'Adjusted Net Asset Value' for the purpose of calculation of
the fees in accordance with the Agreement).
22. Transactions with related parties (continued)
Until the Adjusted Net Value of the Group exceeds £1,500 million, the
entitlements to advisory fees can be summarised as follows:
· Monthly Management Fee payable monthly in arrears: 1/12th of
0.7125% per calendar month of Adjusted Net Asset Value up to or equal to £500
million , 1/12th of 0.5625% per calendar month of Adjusted Net Asset Value
above £500 million and up to or equal to £1,000 million and 1/12(th) of
0.4875% per calender month of Adjusted Net Asset Value above £1,000 million
and up to or equal to £1,500 million.
· Semi-Annual Management Fee payable semi-annually in arrears: 0.11875%
of Adjusted Net Asset Value up to or equal to £500 million, 0.09375% of
Adjusted Net Asset Value above £500 million and up to or equal to £1,000
million and 0.08125% of Adjusted Net Asset Value above £1,000 million and up
to or equal to
£1,500 million.
For the period 31 December 2021 the total advisory fees payable to the
Investment Adviser were £4,300,000 (six months to December 2020: £2,718,000;
year to 30 June 2021: £6,255,423 of which £1,937,162 (30 June 2021:
£1,463,898; 31 December 2020: £572,000) is included in trade and other
payables in the consolidated statement of financial position.
The Investment Adviser is also entitled to an annual accounting and
administration service fee equal to: £51,500; plus (i) £4,175 for any
indirect subsidiary of the Company and (ii) £1,620 for each direct subsidiary
of the Company.
For the period to 31 December 2021 the total accounting and administration
service fee payable to the Investment Adviser was £111,497 (six months to 31
December 2020: £nil, year to 30 June 2021: £64,920) of which £111,497
(six months to December 2020: £Nil; year to 30 June 2021: £52,646) is
included in trade and other payables in the consolidated statement of
financial position.
Introducer Services
Atrato Partners, an affiliate of the Investment Adviser, is entitled to fees
in relation to the successful introduction of prospective investors in
connection with subscriptions for ordinary share capital in the Company. The
entitlement of the Investment Adviser to introducer fees is by fees and/or
commission which can be summarised as follows:
• Commission basis: one per cent of total subscription in respect of
ordinary shares subscribed for by any prospective investor introduced by
Atrato Partners.
For the period to 31 December 2021 the total introducer fees payable to the
affiliate of the Investment Adviser were £92,805 (six months to 31 December
2020: £104,947; year to 30 June 2021: £269,172)
Interest in shares of the Company
Details of the direct and indirect interests of the Directors of the
Investment Adviser and their close families in the ordinary shares of one
pence each in the Company at 31 December 2021 were as follows:
· Ben Green: 1,199,938 shares
· Steve Windsor: 1,319,486 shares
Carried interest held in the Group's joint venture
Under the terms of the Horner (Jersey) LP (the "JV") Limited Partnership
Agreement ("LPA"), an affiliate of the Investment Adviser, Atrato Halliwell
Limited (the "Carry Partner"), has a carried interest entitlement over the
investment returns from the JV's investment in the Structure. Further details
regarding the estimated value of the Carry Partner's interest in the JV are
included in note 13.
22. Transactions with related parties (continued)
The carried interest payments are only payable to the extent that
distributions are made from the JV to the Group. To date there have been no
cash distributions received by the Group and therefore no carried interest
payment has yet become payable.
23. Net asset value per share
NAV per share is calculated by dividing the Group's net assets as shown in
the consolidated statement of financial position, by the number of ordinary
shares outstanding at the end of the year. As there are no dilutive
instruments outstanding, basic and diluted NAV per share are identical.
The Group uses EPRA Net Tangible Assets ("EPRA NTA") as the most meaningful
measure of long term performance and the measure which is being adopted by the
majority of UK REITs, establishing it as the industry standard benchmark. It
excludes items that are considered to have no impact in the long term, such as
the fair value
of derivatives.
The EPRA NTA per share calculation are as follows:
Unaudited Unaudited Audited
31 December
31 December 2020
30 June
2021 2021
£'000 £'000 £'000
Net assets per the consolidated statement of financial position 1,115,084 691,774 871,310
Intangibles (85) - (85)
Fair value of interest rate derivatives (1,780) 2,213 477
EPRA NTA 1,113,219 693,987 871,672
Ordinary shares in issue at 30 June 985,434,429 665,928,154 810,720,168
NAV per share - Basic and diluted (pence) 113p 104p 108p
EPRA NTA per share (pence) 113p 104p 108p
24. Subsequent events
On the 5 January 2022, the Group announced an increase of its revolving credit
facility ("RCF") of £136.5 million with Barclays and Royal Bank of Canada.
The total size of the facility increased to £250.2 million. This secured,
interest-only, RCF has a remaining term of two years and two further one-year
extension options with a margin of 150 basis points over SONIA. The RCF also
includes a £49.8 million uncommitted accordion option which is exercisable
at any time over the term of the facility.
On 5 January 2022, the Group announced the acquisition of a Sainsbury's store
in Washington with non-food units and an Asda store in Cwmbran which was
acquired for a combined value of £55.1 million (excluding acquisition costs)
with an unexpired lease term of 34 and 10 years respectively. The Washington
store has 7 yearly, upwards only, RPI-linked rent reviews and the Asda 5
yearly-upwards only open market rent reviews.
On 7 January 2022, the Group announced that Sainsbury's exercised its second
purchase option to acquire 8 stores within the Sainsbury's Reversionary
Portfolio, of which the Group has a 50:50 share of a 51% beneficial interest
through its joint venture as detailed in note 13.
24. Subsequent events (continued)
On 10 January 2022, the Group completed the acquisition of a Tesco store in
Sheffield, which was acquired for
£73.2 million (excluding acquisition costs) with an unexpired lease term of
17 years with annual, upwards only,
RPI-linked rent reviews.
On 10 January 2022, the Board declared a second interim dividend for the year
ending 30 June 2022 of 1.485 pence per share, which was paid on 25 February
2022 to shareholders on the register on 21 January 2022. This has not been
included as a liability as at 30 June 2021.
Notes to EPRA and other Key Performance Indicators (Unaudited)
1. EPRA Earnings per Share
As at As at As at
31 December 2021 31 December 30 June
£'000 2020 2021
£'000 £'000
Net profit attributable to ordinary Shareholders 71,178 32,755 83,526
Adjustments to remove:
Changes in fair value of interest rate derivatives (2,232) 210 (1,570)
Changes in fair value of investment properties and associated rent guarantees (10,967) (15,462) (36,288)
Group share of changes in fair value of joint venture investment properties (31,048) (1,975) (5,619)
Negative Goodwill - - (3,265)
Weighted average number of ordinary shares(₁) 878,171,925 561,413,104 652,828,945
EPRA EPS 3.1p 2.8p 5.6p
( )
(1) Based on the weighted average number of ordinary shares in issue for the
six months to 31 December 2021.
2. EPRA NTA per share
EPRA NTA is considered to be the most relevant measure for the Group and is
now the primary measure of net assets, replacing the previously reported EPRA
Net Asset Value metric. For the current period EPRA NTA is calculated as net
assets per the consolidated statement of financial position excluding the fair
value of interest rate derivatives.
31 December 2021 (Unaudited) EPRA NTA EPRA NRV EPRA NDV
£' 000 £' 000 £' 000
IFRS NAV attributable to ordinary shareholders 1,115,084 1,115,084 1,115,084
Fair value of interest rate derivatives (1,780) (1,780) -
Intangibles (85) - -
Purchasers' costs - 103,131 -
Fair value of debt - - (719)
Deferred tax - - -
EPRA NAV 1,113,219 1,216,435 1,114,365
EPRA NAV per share 113p 123p 113p
Notes to EPRA and other Key Performance Indicators (Unaudited) continued
30 June 2021 (Audited) EPRA NTA EPRA NRV EPRA NDV
£' 000 £' 000 £' 000
IFRS NAV attributable to ordinary shareholders 871,310 871,310 871,310
Fair value of interest rate derivatives 447 447 -
Intangibles (85) - -
Purchasers' costs - 83,787 -
Fair value of debt - - (2,111)
Deferred tax - - -
EPRA NAV 871,672 955,544 869,199
EPRA NAV per share 108p 118p 107p
31 December 2020 (Unaudited) EPRA NTA EPRA NRV EPRA NDV
£' 000 £' 000 £' 000
IFRS NAV attributable to ordinary shareholders 691,774 691,774 691,774
Fair value of interest rate derivatives 2,213 2,213 -
Intangibles - - -
Purchasers' costs - 60,203 -
Fair value of debt - - 3,700
Deferred tax - - -
EPRA NAV 693,987 754,190 695,474
EPRA NAV per share 104p 113p 104p
3. EPRA Net Initial Yield (NIY) and EPRA "topped up" NIY
As at As at As at
31 December 2021 31 December 30 June
2020
£'000
2021
£'000
£'000
Investment Property - wholly owned (note 12) 1,413,500 885,333 1,148,380
Investment Property - share of joint ventures 265,325 229,125 233,125
Completed Property Portfolio 1,678,825 1,114,458 1,381,505
Allowance for estimated purchasers' costs 122,489 81,312 100,797
Grossed up completed property portfolio valuation (B) 1,801,314 1,195,770 1,482,302
Annualised passing rental income - wholly owned 70,161 46,075 57,754
Annualised passing rental income - share of joint venture 13,294 6,581 13,239
Annualised non-recoverable property outgoings (344) (482) (482)
Less: contracted rent under rent free periods - - -
Annualised net rents (A) 83,111 52,174 70,511
Rent expiration of rent-free periods and fixed uplifts - - -
Topped up annualised net rents (C) 83,111 52,174 70,511
EPRA NIY (A/B) 4.61% 4.36% 4.76%
EPRA "topped up" NIY (C/B) 4.61% 4.36% 4.76%
Notes to EPRA and other Key Performance Indicators (Unaudited) continued
4. EPRA Vacancy Rate
As at As at As at
31 December 2021 31 December 30 June
2020
£'000
2021
£'000
£'000
Estimated rental value of vacant space 155 - 238
Estimated rental value of the whole portfolio 70,161 46,075 57,754
EPRA Vacancy Rate 0.2% 0.0% 0.4%
5. EPRA Cost Ratio
As at As at As at
31 December 31 December 30 June
2021
2020
2021
£'000 £'000 £'000
Administration expenses per IFRS 6,218 4,065 9,262
Service charge income (906) (200) (830)
Service charge costs 1,008 204 1,044
Net Service charge costs 102 4 214
Share of joint venture expenses 50 - 292
Total costs (including direct vacant property costs) (A) 6,370 4,069 9,768
Vacant property costs (80) - (187)
Total costs (excluding direct vacant property costs) (B) 6,290 4,069 9,581
Gross rental income per IFRS 32,746 20,412 48,156
Less: service charge components of gross rental income - - -
Add: Share of Gross rental income from Joint Ventures 7,493 - 9,944
Gross rental income (C) 40,239 20,412 58,100
EPRA Cost ratio (including direct vacant property costs) (A/C) 15.83% 19.93% 16.81%
EPRA Cost ratio (excluding vacant property costs) 15.63% 19.93% 16.49%
(B/C)
Notes to EPRA and other Key Performance Indicators (Unaudited) continued
6. Total Shareholder Return
Total Shareholder Return Six months to Six months to Year to
31 December 2021
31 December 2020
30 June
2021
Share price at start of the period / year 117.5 111.4 111.4
Share price at the end of the period/ year 122.0 106.5 117.5
Increase/(decrease) in share price 4.5p (4.9p) 6.1p
Dividends declared for the year 2.95p 2.93p 5.86p
Increase in share price plus dividends 7.45p (1.97p) 11.96p
Share price at start of period 117.5p 111.4p 111.4p
Total Shareholder Return 6% (2%) 11%
7. Net loan to value ratio
The proportion of our gross asset value that is funded by borrowings
calculated as statement of financial position borrowings less cash balances
divided by total investment properties valuation.
Net loan to value As at As at As at
31 December 2021 31 December 30 June
£'000 2020 2021
£'000 £'000
Bank borrowings 478,031 301,163 409,684
Less cash and cash equivalents (24,070) (61,936) (19,579)
Net borrowings 453,961 239,227 390,105
Investment properties valuation 1,413,500 885,333 1,148,380
Net loan to value ratio 32% 27% 34%
Company Information
Directors Nick Hewson (Non-Executive Chairman)
Vince Prior (Chair of Nomination Committee & Senior Independent Director)
Jon Austen (Chair of Audit Committee)
Cathryn Vanderspar (Chair of Remuneration Committee)
Company Secretary JTC (UK) Limited
The Scalpel
52 Lime Street
18(th) Floor
London
EC3M 7AF
Registrar Link Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
AIFM JTC AIFM Services
Ground floor
Dorey Court
Admiral Park
St Peter Port
Guernsey
Channel Islands
GY1 2HT
Investment Adviser Atrato Capital Limited
36 Queen Street
London EC4R 1BN
Financial adviser, Broker and Placing Agent Stifel Nicolaus Europe Limited
150 Cheapside
London
EC2V 6ET
Auditors BDO LLP
55 Baker Street
London
W1U 7EU
Property Valuers Cushman & Wakefield
125 Old Broad Street
London
EC2N 1AR
Financial PR Advisers FTI
200 Aldersgate Street
London
EC1A 4HD
Website www.supermarketincomereit.com (http://www.supermarketincomereit.com)
Registered Office The Scalpel
52 Lime Street
18(th) Floor
London
EC3M 7AF
Stock exchange ticker SUPR
ISIN GB00BF345X11
This report will be available on the Company's website.
END
1 (#_ftnref1) Includes the Q2 2022 interim dividend paid on 25 February 2022
2 (#_ftnref2) Including post balance sheet acquisitions
3 (#_ftnref3) Including post balance sheet acquisitions and lease regears
4 (#_ftnref4) Based on Atrato Capital Limited estimates of store trading
5 (#_ftnref5) Kantar data
6 Including post balance sheet acquisitions and lease regears
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR DBGDXCBGDGDBRecent news on Supermarket Income REIT
See all newsREG - Supermarket Inc REIT - Dividend Declaration
AnnouncementREG - Supermarket Inc REIT - £215 Million Joint Venture Debt Financing
AnnouncementREG - Supermarket Inc REIT - Establishment of LTIP and PDMR Shareholding
AnnouncementREG - Supermarket Inc REIT - Result of General Meeting
AnnouncementREG - Supermarket Inc REIT - Director Declaration
Announcement