Invesco Property Income Trust Limited
Preliminary Announcement of Unaudited Final Results
for the year ended 31 March 2008
Chairman's Statement
The year to 31 March 2008 has proved eventful for the Company as well as for
property, equity and bond markets in general.
The period has seen a sharp correction in UK commercial property values, in
part reflecting a measure of over-pricing at the end of an extended period of
strong capital performance to June 2007, and also factors associated with the
credit crunch which first manifested themselves in the second half of 2007 and
which continue to affect markets.
The Company has not been immune to these market upheavals and the net asset
value (NAV) and, in particular, the share price has suffered in consequence.
The Board has implemented a number of measures during the year:
* A programme of property sales to reduce debt while maintaining and
improving the quality and risk/reward characteristics of the retained
portfolio;
* Revisions to the Group's financing package subject to contract, permitting
reasonable flexibility in managing the property portfolio in volatile
market conditions; and
* Improvements to net income through asset management initiatives and cost
savings.
The Board's aim is to retain a good quality, diversified portfolio of
properties in the UK and Europe that can deliver a high income stream. In
pursuing this aim further assets were acquired in Europe during the year.
Whilst the acquisitions have assisted in delivering the expected income return
it is regrettable that the downturn in equity markets meant the share issue
proposed in May could not proceed and the acquisitions had to be fully funded
from borrowings. In hindsight, commercial property markets, especially in the
UK, had become overvalued in early 2007 and the falls in property values since
June have been painful for shareholders as the Company has been exposed to the
adverse effect of gearing on its NAV. With the full support of its bankers, the
Company has renegotiated subject to contract, its LTV limits to allow the
Company to pursue its strategy in the current volatile market conditions.
Performance
The share price at 31 March 2008 was 35p, the discount to adjusted* NAV was 53
% and the shares were yielding 19.3 %, as against a price at 31 March 2007 of
122.5p, a discount of 6.3% and a yield of 5.5%. The market's assessment of the
Company has been disappointing but the Board believes that, with the steps
taken, the Company is well positioned to deliver the high income returns sought
and make a strong recovery of NAV when the property markets start to recover.
* Net Asset Value is adjusted to exclude certain derivative financial
instruments £2,092,000 (2007: £3,628,000), deferred tax £21,341,000 (2007: £
13,745,000) and related goodwill £10,745,000 (2007: £6,812,000) giving an
overall increase in assets of £12,688,000 (2007: £3,305,000).
The NAV as at 31 March 2008 was 66.3p per share, a fall of 48.4 % from the
previous year end, and the adjusted NAV as at 31 March 2008 was 74.6p per
share, down 42.9 %.
At the portfolio level, the like for like performance in the UK showed a
decline of 15.2 per cent in the second half and 19.7 % for the year as a whole.
The European portfolio showed a like for like decline in Euros of 6.3 % in the
second half (-6.2 % for the year).
Activity
The first half of the year saw progress being made on the Group's expansion
into European markets, with the acquisition of properties in France, Belgium,
Spain and Germany for an aggregate purchase price of €122m. These acquisitions
have stood the Group in good stead, outperforming the UK portfolio.
In the second half of the year, negotiations on sales of properties have proved
time-consuming although marketing has been successful in generating interest
from several competing parties. Since the year end, completions or exchange of
contracts have taken place on two sales transactions for a total consideration
of £48.4m. Assets valued at a further £43.5m are under offer and in the hands
of solicitors.
The Board believes that, following completion of the disposal programme of
non-core properties, the risk/reward characteristics of the portfolio as a
whole will be improved. The retained portfolio is expected to exhibit strong
defensive characteristics in what is still a difficult economic environment.
The Board is also pleased with asset management initiatives which have improved
the quantum and the security of the group's income. Highlights include the new
letting at Old Jewry in London and negotiation of an extended lease at St
Michel sur Orge in France.
Borrowings limits and Financing
The Company uses borrowings, which are hedged to fix the interest rate payable.
The Board recognises the effect of borrowings on NAV and share price
performance during periods of volatility in property prices. The Board, with
the agreement of the Company's lending bank, sanctioned an increase in gearing
above the Group's long term target level of 55% of gross assets in order to
fund the Group's further expansion into Europe in June 2007. The proposed
equity issue intended to refinance the new borrowings could not proceed, with
the result that gearing remained high through the market downturn in the second
half of the year and the NAV has suffered accordingly. Whilst the Directors are
not proposing any change to the Company's gearing policy, they believe that it
could be detrimental to shareholders to reduce gearing significantly at what
may turn out to be close to the bottom of the market, and accordingly it is
likely that gearing will remain above the long term target level for a longer
period than indicated in December.
Accordingly the Board is pleased that it has agreed, subject to contract,
revised arrangements with its lending bank. The revised terms provide for a
higher long term LTV covenant of 65% and an extension to the arrangements
agreed in December. The new terms permit, until June 2009, LTV ratios of up to
70%, with up to 75% permitted for one quarter up to 31 December 2008. The Board
believes these terms provide the Company with reasonable flexibility operating
in volatile market conditions and strengthen the Company's position despite an
increase in funding costs.
The Group has remained in compliance with all its banking covenants and expects
to continue to do so. The LTV ratio at 31 March 2008, calculated per the
Group's banking agreement, was 69.95 %. The current LTV ratio, which is above
the long term target, does make the Group's NAV more sensitive to fluctuations
in property prices.
Early in the year €84.6m of new borrowings were drawn down to finance the
acquisitions made in Europe. Prior to the end of the year £5m of borrowings
were repaid. At the year end borrowings stood at £298.9m, made up of £187.9m in
Sterling and €140.2m in Euros. All net proceeds of disposals will be used to
reduce borrowings until the LTV falls below the 65% level, at which time the
Directors will consider the most appropriate application of sale proceeds.
The Company also agreed terms with Invesco Ltd, the parent company of the
investment manager, for a working capital loan facility of up to £10m. This
facility is conditional on completion of the revisions to banking terms as
described above, and provides the Group with additional operational
flexibility. The facility remains undrawn.
Earnings and dividend
Rental income continues to be stable, with few signs of weakness in occupier
markets and vacancy rates are low. The Company has had some notable recent
successes, especially in Europe, in extending existing leases and in securing
new lettings, thereby improving the security and the quantum of its income
stream. The effect on earnings of new lettings and rent increases from
indexation in Europe will be enhanced by the Group's fixed rate borrowings.
The second half of the year saw much reduced costs and improved revenue
earnings, due in part to non-recurrence of expenses associated with
acquisitions, in part to the aborted equity fund raise and in part to agreement
reached with the Manager to reduce its management fee rate to 0.75% (0.85%) of
gross assets and to meet certain European administration costs out of its fee.
Earnings in the current and future years will benefit from the new and extended
leases recently concluded.
As a result the Board is pleased to declare an unchanged fourth interim
dividend for the year of 1.6875p per share payable on 8 July 2008 to
shareholders on the register on 20 June 2008. It is the intention of the Board
to maintain this level of dividends and to continue to make four quarterly
dividend payments.
Richard Barnes
Chairman
Manager's report
UK Property Market
Over the 12 month period to March 2008 the UK real estate market witnessed the
most rapid repricing of the asset class since Investment Property Databank's
(IPD's) records began. While the timing of the correction was not a surprise,
the speed at which the market reacted was. In the spring there had already been
signs in the retail sector that the repricing had begun and by the middle of
2007 a correction across the whole market was looking likely. This process was
accelerated by the US Sub-Prime mortgage crisis, which led to the so called
`Credit Crunch' and the wider global uncertainties that have followed. This
correction, effectively a re-pricing of risk within the asset class, and the
relative lack of availability of debt finance, has led to substantial falls in
capital values across all UK property sectors. The Company's half year report
highlighted the initial impact of the slow down, reporting the Company's first
reduction in valuation for the UK portfolio since launch.
We continue to believe that much of the reduction in the risk premium over
government bond yields witnessed from 2001 to 2006 was rational. This was
justified by the improvements to liquidity and accessibility associated with
the increase in cross-border investment activity, improvements in the quality
of information about real estate markets and the availability of funding.
However it is now clear that, by the beginning of 2007, some pricing had become
`irrational'. In the pursuit of income, risk premium spreads between prime real
estate assets and other parts of the market were compressed too far.
Furthermore, some investors were willing to stretch rental growth assumptions
beyond the bounds of credibility in order to justify their increasingly
aggressive pricing. It was for these reasons that this Company has been a net
seller of UK property since mid 2006.
This valuation decline that has been witnessed across the UK property market
has led to the IPD UK Quarterly index reporting a total return of -9.7%, and
capital value declines of 13.9% over the 12 months to March 2008. It provides
some comfort to note that the rate of capital value decline slowed in the final
quarter of the year to -4.6%, from -8.6% in the previous quarter, suggesting
that the bottom of the cycle may be near. Indeed a number of commentators are
suggesting that pricing will `overshoot', principally driven by overly
conservative sentiment on the part of valuers, creating the prospect of a
market recovery in the short to medium term.
Evidence from the occupational side of the UK real estate market is in stark
contrast to this volatility in valuations. Again with reference to the IPD
Quarterly Index, it is clear that the contribution made by income returns has
been remarkably stable over the period, with income returns of 4.8% for the
year to March 2008, being exactly equal to the same figure for the previous
year. This data reflects the reality that the income streams flowing from UK
property have remained mostly unaffected by the factors that have been driving
down valuations.
European property market
While the European real estate markets have not been immune from the downward
pressure on valuations that have been felt so strongly in the UK, the
reductions have been less marked. There have been some valuation declines
witnessed, though generally towards the end of the period. IPD data is only
available for comparison for the year ended December 2007, which shows total
returns for the markets in which this Company is invested ranging from 17.9%
for France, to 4.5% for Germany. As has been seen in the UK, the stability of
income streams, and hence the contribution that income makes to total returns,
has been a notable characteristic of European real estate markets over the
year.
Outlook
With continued uncertainty in the general economic conditions within the UK and
Europe, commentators are predicting wide ranging economic outcomes for the next
12-24 months, though importantly few are forecasting full recessions in any of
the countries, indeed many are attempting to predict `the bottom' of the
market. Real estate markets have always demonstrated cyclical characteristics,
with particularly marked cycles in capital values, and few are expecting these
cycles to cease. We are also expecting the relative strength within most
occupational markets to continue, as the balance of supply and demand of
occupational property in the UK and around Europe is retained. Selected markets
do exhibit higher risk characteristics however, where the economic conditions
are expected to hit company profitability hardest, particularly the City of
London office market, UK retail, and Spanish offices. These are all sub-sectors
where the Company has either low weightings, or no exposure.
Taking the UK office market as an example, the credit crunch is clearly having
an impact on demand from the banking and financial services sector, which is
most clearly manifested in the City of London office market. Here the downturn
in demand has coincided with a peak in development completions and we expect
rents to fall over the next two years. However, the lack of availability of
debt from banks means that very little additional construction is likely and
shortages of space could emerge by 2011, triggering a new rental upswing.
In parallel, the weakening of consumer spending is beginning to be felt in the
retail sector. There have been a number of recent announcements regarding
retailers in the UK and across Europe who are rationalising store portfolios,
closing operations or struggling to meet rent payments. All this highlights the
potential for rising vacancy, particularly in weaker retail centres, and little
prospect of rental growth in the short-term.
The Company has already benefited from the diversification of the property
portfolios into Europe, through a combination of non-correlated valuation
cycles, and income growth through rental indexation. It remains our strategy to
retain a significant weighting to non-UK property assets going forward.
Asset Management
As mentioned above, we continue to be encouraged by the relative strength of
the occupier markets across the Company's portfolio. It has been a very active
period for leasing activity, both in signing new leases, and improving the
terms of existing leases, which is reflected in the Company's relatively low
vacancy rate at the year end of 6.83% (UK 7.42%, Europe 5.64%). Occupiers are
often choosing to remain in occupation beyond either a lease break or lease
expiry, offering the opportunity to secure longer term income streams, without
having to suffer the cashflow erosion that a vacancy would create, 20 such
leases have been negotiated across the portfolio, both in the UK and Europe,
during the period, securing £3.4m p.a. of rental income). One particular
example of such a successful initiative was the previously announced lease
extension agreed with Chevallier Logistics at their warehouse property at St
Michel sur Orge, south of Paris. Here a new 6 year term was negotiated with the
existing tenant, eliminating the vacancy risk associated with the lease breaks
that previously existed for July 2008, February 2010, and February 2013. The
agreed rent for the property amounts to almost €2m p.a., the largest lease in
the portfolio, measured by rent. 15 new lettings have also completed bringing £
1.26m p.a. of new rental income to the portfolio.
While only 2 rent reviews in the UK have been agreed with rental increases
totalling £18,000 p.a. during the period, indexation has led to rental
increases for many of the European properties. In France, where increases
through indexation have been most marked, the combination of indexation and
successful lease renegotiations have resulted in an increase of €419,000 p.a.,
or 6.0%, in rental income. The two Belgian office properties have benefited to
a lesser extent, with total indexation over the year amounting to €43,000 p.a.
(a 2.0% increase).
The focus that we have on retaining existing tenants, in the face of uncertain
economic conditions, is fundamental to maintaining secure cashflows and
protecting shareholder value.
Transactions
One asset was sold early in the period, a retail parade in Norwich, for £2.21m,
giving rise to a loss of £49,000 over the valuation at the time.
Since the period end the Company has announced the completion of the sale of an
office building on Station Road, Harrow, for £4.02m, and the exchange of
contracts for the sale of a portfolio of 15 UK properties, for total
consideration of £44.4m. The net proceeds of both of these disposals will be
used to repay debt.
The Company was successful in implementing its expanded European Investment
Policy, with the purchase of a portfolio of 5 properties (the ISAR portfolio,
located in France, Belgium and Spain), as well as two single asset
acquisitions, one in France, the other in southern Germany. The ISAR portfolio
comprises two logistics warehouses situated to the south of Paris, two modern
office buildings in Brussels, and a well specified industrial building in
Barcelona. The portfolio was acquired for €94.6m, with a net initial yield of
6.0 %p.a., while the St Cloud office building in France was acquired for €
13.44m, a net initial yield of 6.67 %p.a., and the Boeblingen office building
in Germany was acquired for €14.1m, a net initial yield of 4.1% p.a.
As shareholders will be aware from announcements made, the Company is in the
course of disposing of a number of properties, being the continuation of a
programme that began with a number of disposals that were completed in the UK
during the 2006/7 reporting period. Assets have been selected for sale on the
basis of the contribution that those assets are expected to make towards
overall portfolio performance. Consideration has been given to both expected
income, and capital return, requirement for ongoing capital expenditure, as
well as an assessment of potential future vacancy risk.
We are confident that the retained properties following the completion of the
disposal programme will be better placed to weather the potential economic
uncertainty, through enhanced income levels, greater income security, as well
as diversification across both property sectors and country markets.
Performance
Overall, the value of the portfolio has fallen, on a like for like basis by
15.2% over the year, in Sterling terms. This breaks down as -19.7% for the UK
portfolio, and -6.2% for Europe (calculated in Euro). Over the six months to
March 2008, the comparable valuation movements are -8.2% overall (in Sterling),
-15.2% for the UK and -6.3% (in Euro) for Europe; while the corresponding
quarterly valuation movements are -2.2% overall (in Sterling), with the UK at
-5.7% and Europe at -3.0% in Euros.
These movements in capital values, when combined with the impact of
transactions over the period, has led the gross property yield (before head
lease rents) to rise from 6.2% at 31 March 2007, to 7.2% at 31 March 2008.
The portfolio valuation at 31 March 2008, excluding finance leases was £420.18
million.
Summary
In uncertain times, the portfolio strategy will continue to focus on delivering
greater certainty of income from the Company's property assets, while making
orderly disposals of assets, where appropriate, to improve the defensive
qualities and recovery potential of the portfolio.
Effective asset management of the properties will emphasise securing and
improving the income profile through the leasing of vacant space, the retaining
of existing tenants, and the negotiation of longer lease terms from tenants.
There has been considerable success in this area over the year, which is
continuing.
Rory Morrison
Unaudited Consolidated Income Statement
Year Ended 1 March 2006 to
31 March 2008 31 March 2007
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Income
Rental and service
charge income 32,248 - 32,248 24,938 - 24,938
Interest receivable
and
other income 753 - 753 1,292 - 1,292
(Loss)/gains on
investment properties
Unrealised (Loss)/
gains on
revaluation of - (75,687) (75,687) - 26,180 26,180
properties
Realised (Loss)/gains
on
disposal of - (49) (49) - 978 978
properties
33,001 (75,736) (42,735) 26,230 27,158 53,388
Expenses
Management fees (3,254) (444) (3,698) (3,108) (424) (3,532)
Property expenses (7,508) - (7,508) (4,357) - (4,357)
Professional fees (2,653) - (2,653) (1,556) - (1,556)
Goodwill impairment - (7,970) (7,970) - (2,345) (2,345)
(13,415) (8,414) (21,829) (9,021) (2,769) (11,790)
(Loss)/Profit before
finance
Costs and tax 19,586 (84,150) (64,564) 17,209 24,389 41,598
Finance costs (13,752) (1,876) (15,628) (9,193) (1,254) (10,447)
(Loss)/Profit before 5,834 (86,026) (80,192) 8,016 23,135 31,151
tax
Tax (charge)/credit (398) 1,527 1,129 14 (150) (136)
(Loss)/Profit for the
period attributable
to equity 5,436 (84,499) (79,063) 8,030 22,985 31,015
shareholders
(Loss)/Earnings per
ordinary share
- basic and diluted (51.7p) 20.3p
All items in the above statement are derived from continuing operations.
The total column of this statement represents the Group's consolidated income
statement. The supplementary revenue and capital columns are prepared based on
guidance published by the Association of Investment Companies.
Unaudited Consolidated Statement of Changes in Equity
For the year ended 31 March 2008
Stated Other Translation Capital Revenue
Capital Reserve Reserve Reserve Reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 28 101,368 (3,475) - 18,781 51,626 168,300
February 2006
Profit for the period - - - 22,985 8,030 31,015
Unrealised gain on
revaluation of
cross
currency swaps - - 505 - - 505
Exchange differences
on translating
foreign
operations - - (470) - - (470)
Unrealised gain on
revaluation of
interest rate
swaps - 7,573 - - - 7,573
Dividends paid - - - - (10,328) (10,328)
Balance at 31 March 101,368 4,098 35 41,766 49,328 196,595
2007
(Loss)/Profit for the - - - (84,499) 5,436 (79,063)
year
Unrealised gain on - - (5,931) - - (5,931)
revaluation of
cross currency swaps
Exchange differences - - 7,232 - - 7,232
on translating
Foreign operations
Unrealised gain on - (6,191) - - - (6,191)
revaluation of
interest rate swaps
Dividends paid - - - - (11,188) (11,188)
Balance at 31 March 101,368 (2,093) 1,336 (42,733) 43,576 101,454
2008
Unaudited Company Statement of Changes in Equity
For the year ended 31 March 2008
Stated Other Translation Capital Revenue
Capital Reserve Reserve Reserve Reserve Total
£'000 £'000 £'000 £'000 £'000 £'000
Balance at 28 101,368 (3,475) - (1,007) 51,401 148,287
February 2006
(Loss)/profit/for the - - - (1,317) 12,052 10,735
period
Unrealised gain on - 7,573 - - - 7,573
revaluation of
interest rate swaps
Dividends paid - - - - (10,328) (10,328)
Balance at 31 March 101,368 4,098 - (2,324) 53,125 156,267
2007
(Loss)/profit for the - - - (1,774) (9,426) (11,200)
year
Unrealised gain on - (3,922) - - - (3,922)
revaluation of
interest rate swaps
Dividends paid - - - - (11,188) (11,188)
Balance at 31 March 101,368 176 - (4,098) 32,511 129,957
2008
Unaudited Balance Sheet
At 31 March 2008 At 31 March 2007
Consolidated Company Consolidated Company
£'000 £'000 £'000 £'000
Non-current assets
Investment in subsidiary
companies - 318,678 - 320,357
Investment properties 327,942 - 401,060 -
Investment property held 98,670 - - -
for sale
Intangible assets 10,745 - 6,812 -
437,357 318,678 407,872 320,357
Current assets
Trade and other 3,609 444 4,822 304
receivables
Interest rate swap asset - 176 4,098 4,098
Cash and cash 11,908 7,270 34,582 22,117
equivalents
15,517 7,890 43,502 26,519
Total assets 452,874 326,568 451,374 346,876
Current liabilities
Trade and other payables (14,147) (2,891) (11,970) (768)
Taxation (356) (5) (255) (5)
(14,503) (2,896) (12,225) (773)
Total assets less
current
liabilities 438,371 323,672 439,149 346,103
Non-current liabilities
Bank loan (298,252) (187,314) (221,839) (189,366)
Other payables (2,396) - - -
Interest rate swaps (2,092) - - -
liability
Currency swaps liability (6,401) (6,401) (470) (470)
Obligations under (6,435) - (6,500) -
finance
leases
Deferred taxation (21,341) - (13,745) -
(336,917) (193,715) (242,554) (189,836)
Net assets 101,454 129,957 196,595 156,267
Capital and reserves
Stated capital 101,368 101,368 101,368 101,368
Other reserve (2,093) 176 4,098 4,098
Translation reserve 1,336 - 35 -
Capital reserves (42,733) (4,098) 41,766 (2,324)
Revenue reserve 43,576 32,511 49,328 53,125
Issued capital and 101,454 129,957 196,595 156,267
reserves
Net asset value (Note 66.3p 128.5p
3)
Unaudited Statement of Cash Flows
At 31 March 2008 At 31 March 2007
Consolidated Company Consolidated Company
£'000 £'000 £'000 £'000
Operating activities
Rent and service charges
received 31,940 9,079 28,181 -
Bank interest received 2,371 2,556 473 356
Interest from - 22,907 - 21,764
subsidiaries
Bank loan interest paid (18,223) (15,572) (9,182) (8,946)
Operating expense (7,012) (1,345) (6,262) (1,603)
payments
Tax paid (297) - (1,494) ______
Net cash inflow from
-- operating activities 8,779 17,625 11,716 11,571
Investing activities
Investment in group
undertakings (26,861) (21,208) (15,712) (27,420)
Purchase of investment
properties (81,032) - (50,752) -
Sale of investment 2,485 - 32,504 -
properties
Net cash outflow from
investing activities (105,408) (21,208) (33,960) (27,420)
Financing activities
Loan facility fee - - (89) (89)
Bank loan drawdown 79,105 (76) 46,771 46,771
Payment of third party (2,692) - (5,601) -
loan
Dividends paid (11,188) (11,188) (10,328) (10,328)
Net cash inflow/(outflow)
from
financing activities 65,225 (11,264) 30,753 36,354
(Decrease)/increase in
cash and cash
equivalents (31,404) (14,847) 8,509 20,505
Cash and cash equivalents
at beginning of period 34,582 22,117 26,073 1,612
Effect of foreign
exchange
changes 8,730 - - -
Cash and cash equivalents
at end of period 11,908 7,270 34,582 22,117
Notes
1. Basis of Preparation
The financial statements of the Group have been prepared in accordance with
International Financial Reporting Standards (`IFRSs') as adopted for use in the
European Union, which comprise standards and interpretations approved by the
International Accounting Standards Board (`IASB'), and International Accounting
Standards and Standing Interpretations Committee interpretations approved by
the International Accounting Standards Committee (`IASC') that remain in
effect.
While the financial information included in this preliminary announcement has
been prepared in accordance with the recognition and measurement criteria of
IFRSs, this announcement does not itself contain sufficient information to
comply with IFRSs. The Company expects to publish its full financial statements
that comply with IFRSs as adopted for use in the European Union in June 2008.
2. Basic and diluted earnings per ordinary share
Year ended 1 March 2006 to
31 March 2008 31 March 2007
Revenue Capital Total Revenue Capital Total
Profit/(loss) for
the period
attributable to
equity
shareholders (£ 5,436 (84,499) (79,063) 8,030 22,985 31,015
'000)
Basic and diluted 3.5p (55.2)p (51.7)p 5.3p 15.0p 20.3p
earnings/(loss)
per ordinary
share
Number of shares
Year ended 1 March 2006 to
31 March 2008 31 March 2007
Number Number
Weighted average number 153,000,000 153,000,000
of ordinary shares for
the purpose of basic
and diluted (loss)/
earnings per share
3. Dividends
Amounts recognised and paid as distributions to equity holders in the year/
period:
Year ended 1 March 2006 to
31 March 2008 31 March 2007
pence £'000 pence £'000
Fourth interim for 2007 (2006) 2.25 3,442 1.6875 2,582
First interim for 2008 (2007) 1.6875 2,582 1.6875 2,582
Second interim for 2008 (2007) 1.6875 2,582 1.6875 2,582
Third interim for 2008 (2007) 1.6875 2,582 1.6875 2,582
7.3125 11,188 6.75 10,328
Set out below are the dividends that have been declared in respect of the
financial year ended 31 March 2008:
Year ended 1 March 2006 to
31 March 2008 31 March 2007
pence £'000 pence £'000
Dividends in respect of the
year
First interim 1.6875 2,582 1.6875 2,582
Second interim 1.6875 2,582 1.6875 2,582
Third interim 1.6875 2,582 1.6875 2,582
Fourth interim 1.6875 2,582 2.25 3,442
6.75 10,328 7.3125 11,188
A proposed interim dividend of 1.6875p per ordinary share is payable on 8 July
to shareholders registered on 20 June 2008.
4. Net asset value per ordinary share
(a) The net asset value per ordinary share and the net asset values
attributable at the period end calculated in accordance with the Articles of
Association were as follows:
31 March 2008 31 March 2007
Net Assets Net Assets
Net Asset Attributable Net Asset Attributable
Value £'000 Value £'000
Ordinary shares 66.3p 101,454 128.5p 196,595
Net asset value per ordinary share is based on net assets at the period end and
153,000,000 ordinary shares, being the number of ordinary shares in issue at
the period end.
(b) Reconciliation of consolidated NAV per share to adjusted NAV:
31 March 2008 31 March 2007
Pence Pence
per share £'000 per share £'000
Consolidated NAV per
accounts 66.3 101,454 128.5 196,595
Adjustments:
Goodwill (7.0) (10,745) (4.5) ((6812)
Deferred tax 13.9 21,341 9.0 13745
Swaps 1.4 2,092 (2.3) (3628)
Adjusted NAV 74.6 114,142 130.7 199,900
The adjusted NAV is per the European Public Real Estate Association (`EPRA')
measure, published in January 2006. The EPRA NAV per share excludes the fair
value adjustments for debt and interest rate derivatives, deferred taxation on
revaluations, capital allowances and goodwill.
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the periods ended 31 March 2008 or 31 March
2007. The financial information for the period ended 31 March 2007 is derived
from the statutory accounts for that period, which have been delivered to the
Jersey Registrar of Companies. The auditors reported on those accounts and
their report was unqualified. The statutory accounts for the period ended 31
March 2008 will be finalised on the basis of the financial information
presented by the Directors in this preliminary announcement and will be
delivered to the Jersey Registrar of Companies following the Company's Annual
General Meeting.
The audited Report and Accounts will be posted to shareholders shortly. Copies
may be obtained during normal business hours from the Company's Registered
Office, Ordnance House, 31 Pier Road, St Helier, Jersey, JE4 8PW.
The Annual General Meeting will be held on 23 July 2008 at 10.30am at Ordnance
House, 31 Pier Road, St Helier, Jersey, JE4 8PW.
By Order of the Board
R&H Fund Services (Jersey) Limited
Company Secretary
12 June 2008
Enquiries to:
Invesco Asset Management Limited
Angus Pottinger
020 7065 3714
Rory Morrison,
020 7543 3581
