TIDMIPT
RNS Number : 2532R
ISIS Property Trust Limited
15 November 2012
ISIS Property Trust Limited
Interim Management Statement
For the Three-Month Period from 1 July 2012 to 30 September
2012
Investment Objective
The investment objective is to provide shareholders with an
attractive level of income together with the potential for capital
and income growth from investing in a diversified UK commercial
property portfolio.
Performance Summary
For the three For the nine
month period month period
ended 30 ended 30
September September
Total Return * 2012 2012
Net asset value per
share (0.7)% 1.0%
Ordinary share price 5.7% 3.0%
Investment Property
Databank UK Quarterly
and Monthly Index Funds 0.7% 1.9%
Portfolio ungeared
return 0.3% 2.6%
FTSE All-Share Index 4.7% 8.2%
As at As at
30 September 30 June
Capital Values - 3 2012 2012 % Change
months
Net asset value per
share 93.7p 96.4p (2.8)%
Ordinary share price 87.3p 84.5p 3.3%
FTSE All-Share Index 2,998.86 2,891.45 3.7%
Premium/(discount)
to net asset value (6.8)% (12.3)%
Net gearing # 33.6% 32.6%
As at As at
30 September 31 December
Capital Values - 9 2012 2011 % Change
months
Net asset value per
share 93.7p 98.7p (4.7)%
Ordinary share price 87.3p 90.6p (3.6)%
FTSE All-Share Index 2,998.86 2,857.88 4.9%
(Discount) / premium
to net asset value (6.8)% (8.2)%
Net gearing # 33.6% 34.6%
Sources: F&C Investment Business Limited, Investment
Property Databank ('IPD'), Datastream.
* - All total returns are based on net dividends re-invested
# - Gearing: Bank debt (less net current assets) / fair value of
investment properties
Dividends
A second interim dividend for the year ending 31 December 2012
of 2.0 pence per share was paid on 31 August 2012 to shareholders
on the register on 15 August 2012.
A third interim dividend for the year to 31 December 2012 of 2.0
pence per share will be paid on 30 November 2012 to shareholders on
the register on 7 November 2012.
Review of the third quarter
Property Market Overview
The UK property market (as measured by IPD) delivered a total
return of 0.7% in 3Q 2012, an improvement on the 0.4% seen in the
previous quarter. Capital values fell by 0.7%, as yields edged
higher and rental growth slipped by 0.2%, reflecting continued
market uncertainty about the impact of wider economic and financial
developments, both in the UK and overseas, on the asset class.
Retail property delivered a positive performance following a weak
second quarter. Central London property remains sought after
especially by overseas investors, which helped offices record
improved total returns in the period. Investor sentiment generally
is risk averse and focused on prime property and core markets. The
IPD all property income return of 6.0% per annum is seen as
attractive in comparison with yields available for other asset
classes, with assets delivering long-term secure income streams
especially favoured.
Property Portfolio Overview ("the Portfolio")
The value of the Company's Portfolio decreased slightly over the
quarter to GBP120.8m, or by 1.4% after capital costs. The income
return on the Portfolio produced 1.7% giving a total return for the
quarter of 0.3%. Over the year to date, the return from the
Portfolio has been 2.6% which is ahead of the IPD Index of
1.9%.
With capital values trending negative, a number of the Company's
properties followed suit, with reductions in the retail warehouse
sector and southeast office sector in particular. However, a number
of properties maintained their value, including the largest
property, by value, 14 Berkeley Street, London W1. This particular
property had seen significant rise in value from GBP15.7m to
GBP17.3m over the last 12 months as a result of the asset
management initiatives undertaken.
Within the industrial portfolio, the lease to Specsavers at Wide
Lane, Eastleigh has been extended by agreement from May 2015 to May
2027 at the existing passing rent of GBP220,500pa. As part of the
deal the tenant was granted a rental concession equivalent to 21
months' rent free period. The value of the property increased by
GBP300,000 with further increases due as the rent concession
reduces by effluxion of time.
The Manager continues to seek out asset management deals to
preserve value with specific focus on maintaining and enhancing
income streams. At 49, Linthorpe Road, Middlesbrough, Phones4U have
agreed to an extension of their lease, increasing the term from
October 2014 to October 2019, in exchange for a 15 month rent free
period and a rebasing of the rent to GBP70,000pa from GBP86,250pa.
There have been further improvements in value following previously
agreed and reported asset management initiatives. These were at
Network Bracknell, following a new letting to Proctor and Gamble;
the extension of the lease at King George Close, Romford from March
2017 to March 2027; and an uplift in rent from GBP95,000pa to
GBP110,000pa following a review of the lease at the industrial unit
at 6, James Street, York.
With a relatively quiet investment market over the summer
period, the Company has not bought or sold any investment property,
preferring to concentrate on asset management and to retain its
borrowings at a conservative level, during a challenging time in
the market.
At 30th September, the Portfolio continued to enjoy a relatively
low vacancy rate of 2.2%, consisting of a newly refurbished office
at King William House, Hull and a shop unit at 47, Linthorpe Road,
Middlesbrough. The average weighted unexpired lease length
(including breaks) has increased to 9.0 years as a result of the
various lease renewals and lease extensions that have taken
place.
Top Ten Holdings
30/09/2012
Percentage
of Portfolio
Property Sector
London W1, 14 Berkeley
Street Offices 14.4
Chelmsford, County House,
County Square Offices 7.2
Luton, Enterprise Way Retail warehouses 6.5
Halls Mill Retail Park,Bury Retail warehouses 6.2
Andover, Keens House,
Anton Mill Offices 6.1
New Malden, 7 Beverley
Way Retail warehouses 6.1
Bracknell,1/2 Network
Bracknell, Eastern Road Industrial 5.5
Hull, King William House,
Market Place Offices 5.3
St Albans,16,18&20 Upper
Marlborough Road Offices 4.9
Eastleigh, Wide Lane Industrial 4.1
Total 66.3
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Geographical Analysis
30/09/2012 30/06/2012
Percentage Percentage
Location of Portfolio of Portfolio
South East 36.4 36.2
Eastern 15.5 15.9
West End 14.4 14.2
Rest of London 10.0 10.1
North West 6.3 6.2
Yorkshire and Humberside 6.3 6.1
South West 4.0 4.0
West Midlands 3.1 3.1
East Midlands 3.0 3.2
North East 1.0 1.0
Total 100.0 100.0
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Sector Analysis
30/09/2012 30/06/2012
Percentage Percentage
Location of Portfolio of Portfolio
Offices 40.1 40.2
Retail warehouses 22.2 22.5
Industrial 20.4 19.7
Retail 17.3 17.6
Total 100.0 100.0
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The Board is not aware of any significant events or transactions
which have occurred since 30 September 2012 and the date of
publication of this statement which would have a material impact on
the financial position of the Company.
Quarterly and Key Information
Further information regarding the Company, including performance
since launch and the most recent annual and interim reports, can be
found at the Company's website www.isispropertytrust.com, or at
www.fandc.com.
This interim management statement has been prepared solely to
provide information to meet
the requirements of the UK Listing Authority's Disclosure and
Transparency Rules.
For further information please contact:
Ian McBryde/Scott Macrae
F&C Investment Business Limited
Tel: 0207 628 8000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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