Londonmetric Property Plc · LSE:LMP
Londonmetric Property — Metric Property Investments — FY2011 Earnings Presentation
22 slides from Londonmetric Property's earnings presentation, May 19, 2011
Slide 1: Full-year results to March 2011
Full-year results to March 2011 19 May 2011
Slide 2: Business Highlights since IPO
Business Highlights since IPO • Nimble specialist REIT investing across all retail subsectors • Purchased £176m in 14 acquisitions across retail parks and foodstores • Committed £9m of capex to accretive asset management initiatives • Valuation uplift £16.6m (+9.5%) or £7.6m (+4.1%) after acquisitio
Slide 3: Delivering on Our Strategy to Create Value
Delivering on Our Strategy to Create Value 3
Slide 4: Financial Results
Financial Results Income Statement Adjusted Profit Net rental income (£m) 4.6 • Net rental income reflects average ownership less than five Administrative expenses (£m) (4.4) months Net Interest income (£m) 0.9 • Annualised rent roll £12m Adjusted profit (£m) 1.1 EPS (p) 4.4 • Administrative expense
Slide 5: Financing
Financing • All acquisitions to date financed from cash resources • Cash on deposit as at 31 March 2011 of £28m against commitments of £36m Royal Bank of Eurohypo • New Eurohypo facility of £34.7m Scotland • £84.7m unutilised committed facilities (secured) 5 year 5 year term • Conservative approach
Slide 6: £176m of acquisitions to date across 14 assets
£176m of acquisitions to date across 14 assets 6
Slide 7: Shape of Portfolio
Shape of Portfolio Partnering Investments Redevelopments • Retailer initiated • Well let – long and strong • Favourable planning outlook income • Asset management • Advantageous demand / opportunities to: • Passing rents < £15 psf supply balance – Extend – Re-gear • High occupier contentment • Risk
Slide 8: Property Portfolio
Property Portfolio WAULT – Weighted average unexpired lease term of 11.8 years to expiry (11.1 years to first break) 8
Slide 9: Outlook
Outlook • Vendor refinancing pressures creating opportunities – Private property companies will become ‘motivated’ vendors – Expiring swaps will ‘release’ sales • Continuous flow of shopping centre opportunities • Limited retail park investment activity – Retail Partnering growing – Redevelopment op
Slide 10: Delivering on Asset Management Initiatives
Delivering on Asset Management Initiatives • 20 transactions with 14 retailers across 11 properties and 385,000 sq ft – new lettings lease terms > 15 years – new lettings > £5.50 psf above previous passing rent – re-gears > £3.50 psf above previous passing rent – rent reviews achieved 15% above prev
Slide 11: Broad Sector Exposure (weighted by income %)
Broad Sector Exposure (weighted by income %) 11
Slide 12: Valuation: +9.5% or £16.6m on underlying property values
(1) Valuation: +9.5% or £16.6m on underlying property values Launceston, Coventry, Congleton, Leeds, Inverness Newry, Bedford, Hove Bedford, Congleton, Hove Congleton, Launceston, Newry Milford Haven, Loughborough (1) Underlying property value: £192.4 million 12
Slide 13: Reversions captured – income yield rising
Reversions captured – income yield rising £3m+ Potential reversions from closing gap to sustainable rents 13
Slide 14: Launceston Case Study
Launceston Case Study • Acquired Aug-10 for £13.5m • Open A1 planning consent, except for Focus unit • Average rent £11.20 psf • Surrender of Co-op unit, received £250,000 reverse premium • Planning achieved to sub-divide Co-op unit into 3 units and upgrade elevation • New leases completed with New
Slide 15: Portfolio Metrics
Portfolio Metrics • c. 1 million sq ft across retail park and foodstore subsectors • Low average passing rent £12.70 psf (£14.50 psf on investments) – average sustainable rent £18.65 psf on investments • High occupancy at 97% • Annualised rent roll £12m – 14% of rent roll is subject to guaranteed up
Slide 16: Market Outlook
Market Outlook • Dislocation between investment market and occupational market – Some yields unsupported by property fundamentals • Retailer trading is tough – best operators seem to be winning – Demand for new space is polarised – Occupier mobility is becoming a real issue as leases begin to expire
Slide 17: Summary and Prospects
Summary and Prospects • Operate in sectors where we have a clear competitive advantage • Capitalise on asset management opportunities and accretive capital expenditure • Exploit the arbitrage between current and sustainable rents • Income growth is key to future outperformance – Retailer profitabili
Slide 18: www.metricproperty.co.uk
pA METRIC PROPERTY INVESTMENTS PLC www.metricproperty.co.uk
Slide 19: Current Portfolio Metrics
Current Portfolio Metrics (1) Inves'mt Average Sustainable (2) (3) (4) Date Area portfolio Yield WAULT Rent roll rent rent Future asset Location acquired (sq ft) (£mn) (%) (years) (£mn) (£ psf) (£ psf) management angles Newry 07-Jul-10 161,500 34.9 6.4% 14.4 2.3 14.50 22.00 Broaden planning consent,
Slide 20: £195m Investment Portfolio Across 14 Retail Schemes
(1) £195m Investment Portfolio Across 14 Retail Schemes (2) Notes 1 Portfolio valuation as at 31 March 2011 of £192.4m plus post balance sheet acquisition oat Sheffield for £2.3m 2 Includes subsequent acquisition of adjoining site 20
Slide 21: UK comparison goods - distribution of sales
UK comparison goods - distribution of sales 2005 2010 2020 Source: 21
Slide 22: Out of Town – Dynamic Retail Market
Out of Town – Dynamic Retail Market Expanding Rightsizing New Entrants Contracting 22
Metric Property Investments — FY2011 Earnings Presentation on 6ix