Category: Uncategorized (Page 325 of 346)

Residential Secure Income plc

Net Asset Value and corporate update

Residential Secure Income plc (“ReSI plc”) (LSE: RESI), which invests in independent retirement living and shared ownership to deliver secure, inflation-linked returns, is pleased to announce its unaudited first quarter net asset value (“Net Asset Value” or “NAV”) as at 31 December 2023 and to update on recent corporate activity for the period.

Strong operational performance reflecting defensive nature of assets

·      Portfolio focused on direct leases with pensioners and part homeowners

·      Rent collection consistent at over 99% for the quarter

·      Rental growth of 6.6% on 449 properties (15% of portfolio) giving 1.3% like-for-like growth

·      Shared ownership portfolio fully occupied with record 96% retirement occupancy continuing

Advancing sale of Local Authority Portfolio

·      Exchanged on sale for £5.8mn of assets in line with September 2023 book value, with completion scheduled to occur by early April 2024

·      As announced at year end, proceeds will be used to pay down floating rate debt

·      Remainder of the Local Authority portfolio under offer with due diligence advancing

Fully covered dividend

·      Quarterly dividend of 1.03 pence per share (“p”) announced today in line with FY24 target³

·      121% dividend coverage from Adjusted EPRA earnings of 1.25p

·      Local Authority Portfolio Sale is expected to reduce annualised dividend coverage by c.6% but improve its quality through repayment of floating rate debt

Valuation decline as a result of a 10 basis point outward yield shift across the portfolio

·      Total EPRA return for the quarter of -0.8% (0.7p) to give EPRA NTA of 80.1p (£148.3mn) as at 31 December 2023

·      Driven by a 1.3p, or 0.6% decrease in like-for-like investment property values, as follows:

o 1.8p increase from inflation-linked rent reviews in the quarter

o 3.1p decrease resulting from a further 10 basis points outward yield shift

·      Annualised net rental yields now 5.6% in retirement and 3.5% in shared ownership

Resilient balance sheet with long-term and low-cost debt

·      Diverse portfolio of 3,293 homes worth £343mn

·      21-year average debt maturity, 90% fixed or index linked

·      Loan-to-value ratio of 52% and reduced to 43% when including 22% reversionary surplus

·      Sale of local authority portfolio will allow for repayment of all floating rate and short-term debt

Outlook

·      Strong rental inflation-linked growth expected to continue, underpinned by wage/pension growth

·      Strong and accelerating institutional appetite for residential exposure

·      Focus on driving retirement performance including rationalising portfolio footprint, driving rents, and reducing leakage

·      Continuing to review options for further disposals which support maximising shareholder value

·      Acute need for more affordable homes, estimated at £34bn  annually

·      Particular shortage of independent retirement accommodation for growing elderly population and accessible homeownership options providing significant opportunity to scale these platforms and drive returns

Unsurprisingly TENT has moved from the trending up portfolio

to the trending down portfolio.

As always best to DYOR before making any trading decisions.

Posted on 30th January 2024 | By Bruce Packard

Bruce remembers a metaphor from the founder of the Georgian Stock Exchange and wonders how it might apply to Chinese financial markets.

The FTSE 100 was up +2.2% to 7653 last week. The Nasdaq100 and S&P500 rose +2.4% and 1.1%. Brent Crude was up +4% in the last 5 days, most of which was on Monday morning. Chinese stockmarkets have bounced with the FTSE China 50 up +8.3% and the Hang Seng +7.5%.

The FT has reported that the Chinese authorities have tried to halt the sell-off in domestic equities. For instance, institutional investors have been told not to sell equities and short selling has been curbed. That might explain the short-term bounce but the FTSE China 50 is still down -31% in the last 12 months. ETFs tracking US and Japanese markets are becoming increasingly popular among Chinese retail investors, such that mutual funds were hitting limits that were designed to protect capital controls. The Chinese Yuan (CNY on Sharepad) is linked to the US dollar – but allowed to fluctuate around a narrow band. If the CNY continues to weaken, that could also be bad news for commodities and mining shares.

Many years ago I met the founder of the Georgian Stock Exchange, a chap called Gogi Loladze. He cut a dashing figure and was something of a capitalist philosopher, in the style of George Soros. Autocratic leaders, he said, craft their own narratives, and prevent any data that contradict their stories from circulating. However, these autocrats feared financial markets, because liquidity requires buyers and sellers to trade on good (that is, not unfair) information. The financial markets are like a barometer, it tells you what the air pressure is, and if a storm is blowing in, the meteorological instrument will warn you. That’s in contrast to government statistics like GDP which can be manipulated by less scrupulous leaders.

Gogi was keen to develop the Georgian Stock Exchange because

i) it would provide an alternative source of capital in competition to the banking system

ii) it would strengthen Georgia institutionally, which at the time wanted to be the “Singapore of the Caucasus”

iii) it would make him rich.

Building any two-sided platform is hard and he couldn’t get to critical mass and benefit from network effects. The Georgian Stock Exchange still exists but is owned by the large banks, which are not keen to develop it for some of the same reasons above. As a generalisation bankers prefer “discretion” (also known as secrecy) to the circulation of financial information.

Since then it has struck me that Gogi’s insight from a former Soviet Union country could apply equally well to China, which is communist, and increasingly autocratic but has a huge stock market. The Chinese GDP figures were announced a couple of weeks ago and were in line with expectations at c. +5%. No one seems to have a convincing narrative on why Chinese equities are selling off, but I would be wary. Below is a chart showing the FTSE China 50 (XINO) has fallen for 3 consecutive years in a row.

Impact Healthcare REIT plc

(“Impact” or the “Company” or, together with its subsidiaries, the “Group”)

2023 UPDATE, DIVIDEND DECLARATION AND 2024 DIVIDEND TARGET

HIGHLIGHTS

Our tenants continue to improve their performance with higher care home occupancy and increased fees to residents as inflation peaked in the year. Our rent increases are largely capped at 4%, so this helps tenants’ rent cover, and makes our income more secure. Boosted by an acquisition, our total rent roll grew strongly and this has flowed through to both earnings and dividend growth.

· 13.2% increase in contracted rent to £48.8 million for the 2023 year (+£5.7 million). Rental growth was driven by inflation-linked rent reviews (capped at 4%) plus a significant acquisition.

· 2.2x tenant rent cover(1) in Q3, up from 1.9x in the same quarter the previous year. This is the strongest quarterly tenant performance since the Company’s inception in 2017.

· 20.8 years weighted average unexpired lease, up from 19.7 years the previous year.

· Delivered a 3.5% increase in dividends per share in 2023 with a Q4 dividend of 1.6925 pence in line with our target of 6.77 pence per share for the year to 31 December 2023.

· 2.7% increase in dividend target to 6.95p for the 2024 year.

PORTFOLIO TRADING UPDATE

· Stronger tenant rent cover is driven by several factors: improving room occupancy; growth in average weekly fees charged by tenants; and rent increases largely being capped at 4%.

· The Group has received 100% of rent payments due (excluding the ex-Silverline homes) for the quarter to 31 December 2023 .

· Tenants maintained their profit recovery in Q4 and, based on the 88% of the Company’s portfolio that has reported so far, we estimate that the full year 2023 rent cover rose to 2.0x, up 0.2x compared to the full year 2022 of 1.8x.

· Occupancy at 31 December 2023 was 88.2%, up from 87.4% at 31 December 2022.

· The average weekly fees the Group’s tenants charge for the care they provide grew by c.12% in the 12 months to 31 December 2023.

· The £5.7 million growth in contracted rent was due to;

o £3.9 million from the acquisition of a portfolio of six homes near Shrewsbury leased to Welford, in January 2023.

o £1.6 million from 119 rent reviews in the year at an average increase of 4.1%.

o £0.3 million from rentalised capital expenditure with the largest projects being at Mavern and Yew Tree.

o Less £0.2 million from the disposal of one home.

· The former Silverline portfolio of seven homes continues to show improved performance under the management of Melrose, an affiliate of the Minster Group

o Melrose has undertaken a significant amount of work in a relatively short space of time including: measures to stabilise staff teams and to reduce use of agency staff; settling outstanding invoices with suppliers; renegotiating utility contracts; and focusing on improving processes and the care environment for both staff and residents.

o The portfolio of four homes in Scotland has an average occupancy of 88% and is now cashflow positive. Negotiations are well advanced to transfer these homes back to rent generating operational leases.

o The portfolio of three homes in Bradford is expected to be cashflow positive by the end of first quarter of 2024 with discussions underway on a new management proposal.

· At 31 December 2023, our portfolio comprised 140 healthcare properties, of which:

o 138 are care homes managed by 13 tenants on fixed-term leases with an average WAULT of 20.8 years (no break clauses), subject to annual upward-only Retail Price Index-linked rent reviews (with a floor and cap at 2% p.a. and 4% p.a., respectively on 117 leases, and 1% p.a. and 5% p.a. on 21 leases).

o In addition, the Group owns two healthcare facilities leased to the NHS with an annual CPI uplift (uncapped).

o In total, the Group had 14 tenants across its Portfolio.

FINANCING

· As at 31 December 2023 the Group’s drawn debt was £184.8 million:

o 95% hedged through a combination of fixed debt (£75 million at 3.0%) and SONIA interest rate caps (£50 million at 3% and £50 million at 4%).

o EPRA LTV of 27.7% based on 30 September 2023 balance sheet information.

o The current average cost of drawn debt, including hedging and fixed rate borrowings, is 4.56%.

DIVIDEND DECLARATION AND 2024 DIVIDEND TARGET

· The Board has today declared the Company’s fourth interim dividend for the year ended 31 December 2023 of 1.6925 pence per ordinary share, payable on 23rd February 2024 to shareholders on the register on 9th February 2024. The ex-dividend date will be 8th February 2024. This dividend will be paid as a Property Income Distribution (“PID”).

o This is consistent with the prior three quarters dividends and delivers on the Company’s annual dividend target of 6.77 pence per share for the year ended 31 December 2023. This is in line with the Company’s dividend policy, which seeks to maintain a progressive dividend that is covered by its adjusted earnings.

· The target dividend for the year to 31 December 2024 is 6.95 pence per share, a 0.18 pence increase from the prior period.

· The Company expects to report its full accounts for the year to 31 December 2023, which will include an updated valuation of the portfolio, in late March 2024.

Thursday 1 February

AEW UK REIT PLC ex-dividend payment date
Albion Enterprise VCT PLC ex-dividend payment date
Blackstone Loan Financing Ltd ex-dividend payment date
Capital Gearing Trust PLC ex-dividend payment date
CC Japan Income & Growth Trust PLC ex-dividend payment date
Dunedin Income Growth Investment Trust PLC ex-dividend payment date
Ecofin Global Utilities & Infrastructure Trust PLC ex-dividend payment date
Edinburgh Investment Trust PLC ex-dividend payment date
Henderson International Income Trust PLC ex-dividend payment date
JPMorgan Emerging Europe Middle East & Africa Securities PLC ex-dividend payment date
JPMorgan Global Core Real Assets Ltd ex-dividend payment date
JPMorgan Mid Capital Investment Trust PLC ex-dividend payment date
JPMorgan UK Smaller Cos Investment Trust PLC ex-dividend payment date
M&G Credit Income Investment Trust PLC ex-dividend payment date
Marwyn Value Investors PLC ex-dividend payment date
Polar Capital Global Financials Trust PLC ex-dividend payment date
Polar Capital Global Healthcare Trust PLC ex-dividend payment date
Schroder Oriental Income Fund Ltd ex-dividend payment date
Starwood European Real Estate Finance Ltd ex-dividend payment date

Could u have made a profit trading the GCP news.

Yes, but patience needed and better to have traded.

CT global have two Portfolios CMPG and CMPGI

The trust of interest is CMPGI as it pays a dividend.

ACTIVITY BREAKDOWN
Top 10 Holdings

Name Holdings
Law Debenture Corp (The) PLC 4.7%
NB Private Equity Partners Class A Ord 4.6%
JPMorgan Global Growth & Income PLC 3.9%
Murray International Ord 3.9%
3i Infrastructure Ord 3.5%
Greencoat UK Wind 3.4%
Mercantile Ord 3.4%
Scottish American Ord 3.4%
Merchants Trust Ord 3.4%
Henderson International Income Ord 3.2%

U would have a holding in each of the above.

Dividend

Income Shares – Financial Highlights and Performance Summary for the Six Months

·      Dividend yield of 6.5% at 30 November 2023, compared to the yield on the FTSE All-Share Index of 4.0%. Dividends are paid quarterly.

·      Net asset value total return per Income share of -2.9% for the six months, underperforming the total return of the FTSE All-Share Index of +1.6% by -4.5% points.

Revenue and Dividends

The Company’s net revenue return for the six months was £2.12 million which is equivalent to 4.19p per Income share (compared to 4.01p per Income share for the corresponding period in 2022). Income shareholders are entitled to all the dividends paid by the Company. The second half of the financial year will see the impact of the removal of dividends by Digital 9 Infrastructure and Hipgnosis Songs Fund referred to above. However, these will not impact the Board’s dividend intentions for the financial year as the Company enjoys significant distributable reserves that can be used to overcome any temporary or extraordinary revenue shortfalls.

As I referenced in the 31 May 2023 Annual Report and Financial Statements, in the absence of unforeseen circumstances, it was (and it remains) the Board’s intention to pay four quarterly interim dividends, each of at least 1.80p per Income share so that the aggregate dividends for the financial year to 31 May 2024 will be at least 7.20p per Income share (2023: 7.20p per Income share).

To date, a first and second interim dividend in respect of the year to 31 May 2024 have been announced and paid, each at a rate of 1.80p per Income share (1.67p per Income share in the corresponding periods in the year to 31 May 2023).

The minimum intended total dividend for the financial year of 7.20p per Income share represents a yield on the Income share price at 30 November 2023 of 6.5% which was materially higher than the yield of 4.0% on the FTSE All-Share Index at the same date.

The Income Portfolio was particularly affected by the adverse environment for investment companies in the alternatives sub-sector and this was a key factor in the portfolio lagging the benchmark. The best performers included CC Japan Income & Growth Trust which had a 9% rise in its share price. Although the Tokyo market performed well, much of the rise was diluted for UK investors due to a weakening of the yen relative to sterling; however, the value orientated style of the manager helped the trust to outperform. Private equity trust NB Private Equity Partners has been a long-term outperformer for the Income Portfolio, and this continued with a 10% rise in its share price. Another consistent outperformer has been JPMorgan Global Growth & Income which continued to do well with a 8% rise in its share price. The main detractors were Digital 9 Infrastructure with a 48% fall in the share price. This was a disappointment as the trust has some valuable assets, but too much debt led to a removal of the dividend and was behind the share price decline. Another high profile detractor was Hipgnosis Songs Fund whose share price fell by 16%, at least in part due to it also removing its dividend, though in addition there have been governance, accounting and debt level concerns too. Impact Healthcare REIT, a specialist healthcare property REIT, experienced a 16% fall in its share price. This was a case of higher interest rates being reflected in a modest decline in the net asset value which caused the shares to move to a wider discount. Encouragingly the dividend was raised by 3.5%. 

Positive

If the Trust buys a clunker such as SONG it’s less detrimental in a bigger

portfolio.

GCP Infrastructure Investments Limited

Company update, net asset value(s) and Dividend Declaration

Net Asset Value

GCP Infra announces that at close of business on 31 December 2023, the unaudited net asset value per ordinary share of the Company was 109.84 pence (30 September 2023: 109.79 pence), an increase of 0.05 pence per ordinary share. The net asset value takes into account cash, other assets, accrued liabilities and expenses and leverage of the Company attributable to the ordinary share class.

The primary driver of the Company’s NAV movement in the quarter was the updated OBR inflation forecast, following the Autumn Statement in November 2023, that contributed c. 1.0 pence per ordinary share. This was offset by further reductions in forecast electricity prices, primarily decreases in short-term power prices, decreasing forecast cash distributions to the Company from certain renewable energy investments. This power price volatility is partially offset by the positive performance of the Company’s hedging arrangements. The overall net power price movements negatively contributed c. 0.7 pence per ordinary share.

Increases to discount rates led to a reduction of c. 0.5 pence per ordinary share, resulting in the weighted average discount rate used by the Company to value its investment portfolio of 7.76% at 31 December 2023. This was offset by increased actual cash distributions to the Company from its renewable energy investments that contributed c. 0.1 pence per ordinary share. A summary of the constituent movements in the quarterly net asset value per ordinary share is shown below.

Net asset value analysis (pence per share)	NAV	Change
30 September 2023 NAV	109.79
November 2023 OBR inflation forecast		0.98
Q4 2023 power price forecast (inclusive of hedging value changes)		(0.72)
Discount rate increases		(0.48)
Actual generation across the renewable energy portfolio		0.08
Share buyback accretion		0.18
Other valuation changes		0.01
31 December 2023 NAV	109.84

Portfolio

Notwithstanding the lower electricity price forecasts, the portfolio continues to perform materially in line with the Company’s expectations. The Company’s mature, diverse and operational portfolio provides defensive access to income against a backdrop of market volatility and uncertainty. It is the view of the Company that the long-term and structural demand for infrastructure, and particularly infrastructure debt, offers investors an attractive exposure to an asset class whose performance is non-correlated to wider markets and benefits from long-term and partially inflation protected income. Further portfolio information is available at: http://www.graviscapital.com/funds/gcp-infra/literature, including a line-by-line breakdown of the investment portfolio and underlying assets that will be updated by the Company periodically.

Buybacks

On 14 March 2023 the Company announced a proactive programme of share buybacks in response to the persistent discount at which the Company’s share price is trading relative to the published net asset value. The Company remains committed to pursue buyback opportunities in line with the capital allocation strategy that has been set out in the annual report, and to benefit from the investment opportunity that the Company’s shares offer at the current price. At 31 December 2023, the Company had bought back 16,985,019 shares.

Dividend

GCP Infra is pleased to announce a dividend of 1.75 pence per ordinary share, for the period from 1 October 2023 to 31 December 2023. The dividend will be paid on 8 March 2024 to holders of ordinary shares recorded on the register as at the close of business on 9 February 2024