TIDMNRR
RNS Number : 4446B
NewRiver REIT PLC
08 October 2020
NewRiver REIT plc
("NewRiver" or the "Company")
Trading Update
NewRiver is today hosting a virtual Capital Markets Event
focused on its community pub business, Hawthorn Leisure, and is
providing the following trading update.
The Company has continued to make strong progress in three key
areas: rent collection, cash and liquidity, and disposals.
Retail rent collection
Our rent collection for the first and second quarters continues
to improve, and in recent weeks we have signed key agreements with
a number of retailers which until now represented a significant
proportion of rent outstanding.
Rents in respect of the third quarter were due on 29 September,
and rent that has either been collected or had alternative payments
agreed for this period is already 72% ahead of where it was at the
same stage in the second quarter, at 66%. This reflects an overall
recovery in retail sales and the significant progress that has been
made in reaching payment agreements with the Company's
occupiers.
The table below shows the current status of rent collection for
the first two quarters of FY21, providing comparatives to the
figures provided in previous releases.
Q1 FY21 Q2 FY21
As at 8 Oct 2020 14 Aug 2020 18 June 2020 8 Oct 2020 14 Aug 2020
--------------- ---------------- ------------- --------------- ----------------
Collected 69% 64% 52% 71% 60%
--------------- ---------------- ------------- --------------- ----------------
Deferred 9% 10% 17% 6% 5%
--------------- ---------------- ------------- --------------- ----------------
Re-gear 7% 10% 6% 7% 15%
--------------- ---------------- ------------- --------------- ----------------
Total collected
or alternative
payments agreed 85% 84% 75% 84% 80%
--------------- ---------------- ------------- --------------- ----------------
Waived 4% 1% 4% 1% 1%
--------------- ---------------- ------------- --------------- ----------------
Rent outstanding 11% 15% 21% 15% 19%
--------------- ---------------- ------------- --------------- ----------------
Total (%) 100% 100% 100% 100% 100%
--------------- ---------------- ------------- --------------- ----------------
Disposal progress
As we enter the second half of FY21, the Company is ahead of its
strategy to dispose of GBP80 million to GBP100 million of assets
this financial year, with GBP65.7 million of disposals either
completed, exchanged or currently under offer. In aggregate these
disposals represent a modest 3% discount to March 2020
valuations.
Completed disposals total GBP50.9 million, including the
disposal announced last week of 90% of our interest in Sprucefield
Retail Park, Lisburn, to our joint venture partner BRAVO Strategies
III LLC ("BRAVO").
Notwithstanding that the retail real estate capital markets were
significantly impacted by COVID-19, particularly in the first
quarter, the progress we have made with disposals to date reflects
the liquidity and locational qualities of the Company's portfolio.
Active discussions relating to a number of further disposals are
progressing, which we expect to complete in the second half of
FY21.
Cash and liquidity
We begin the second half with GBP140 million of cash reserves,
which is 71% higher than the position as at 31 March 2020, driven
by the progress with disposals and rent collection. Both the retail
and pub businesses have remained cash positive throughout lockdown
and beyond. Including our GBP45 million of undrawn revolving credit
facilities and our eligibility for GBP50 million of financing under
the Covid Corporate Finance Facility ('CCFF'), which the Company
currently has no need or intention to draw, the Company has total
available liquidity of GBP235 million.
Retail portfolio
Across our retail portfolio, 94% of occupiers by gross income
are now open and trading.
We have continued to progress leasing activity in recent months.
This includes the signing of two new leases with B&M at our
retail parks in Beverley and Blackburn, and new leases with Burger
King and Costa on two drive thru units that we developed at
Waterfront Retail Park, Barry. Last month, we completed a portfolio
deal with the value card and gift retailer Cardzone, which saw it
take an additional six stores across our portfolio, more than
doubling our rental income from this growing retailer.
Footfall has remained relatively robust across our community
shopping centre portfolio. In the week prior to this announcement,
commencing 28 September 2020, footfall was 131% higher than the
week commencing 8 June 2020, the last week before non-essential
stores were allowed to reopen, and 31% below the same week in 2019.
This year-on-year performance is a 10% outperformance of the UK
benchmark.
We continue to have limited exposure to the structurally
challenged retail sub-sectors that have been particularly impacted
by COVID-19 and recent restrictions, with no department stores in
our portfolio, and minimal exposure to mid-market fashion and
casual dining operators.
Residential development
We have continued to progress residential conversion
opportunities across our retail and community pub portfolio. In
September 2020, Mid Sussex District Council approved our revised
plans for the regeneration of Burgess Hill town centre, increasing
the residential provision of the scheme from 142 to 172 units, and
reducing the space designated for retail. We are also now under
offer to sell to a housing association the 10 residential units at
our combined c-store and residential development at the former site
of the Sea View Inn in Poole, which reached practical completion at
the end of July 2020.
Hawthorn Leisure
Almost all of our community pubs in England, Scotland and Wales
are now open and trading.
Our pub portfolio has outperformed the wider market since the
easing of lockdown restrictions. For the 12 week period since 5
July 2020, the day pubs were allowed to open in England,
like-for-like volumes in our Leased & Tenanted pubs were down
only 8% compared to the same period in 2019, and like-for-like
sales in our Operator Managed pubs were down 16% compared to the
same period in 2019. Our trading performance compares favourably to
the wider market over the same period, with data from the Coffer
Peach Business Tracker reporting that pub like-for-like sales are
down 18% compared to the same period last year.
Hawthorn returned to profitability within eight weeks of
reopening. For the month of September 2020, Hawthorn Group EBITDA
was GBP1.9 million, which is 90% of the Hawthorn Group EBITDA in
September 2019.
The liquidity and alternative use value of pubs is evidenced by
the fact that, since 1 April 2020, we have sold 19 pubs, generating
GBP5.1 million in proceeds, and two convenience stores, generating
GBP2.1 million.
Capital Markets Event 2020
NewRiver will be hosting a virtual Capital Markets Event at 2pm
until 5pm today, focused on its community pub business, Hawthorn
Leisure. Details on how to register for the event and view the
webcast live can be found at the following link:
https://kvgo.com/IJLO/NewRiver_Capital_Markets_Event_2020
There will be an opportunity for investors to submit written
questions during the presentation. Materials from the event can be
found on our website shortly after its conclusion.
For further information
NewRiver REIT plc +44 (0)20 3328 5800
Allan Lockhart (Chief Executive)
Mark Davies (Chief Financial Officer)
Tom Loughran (Head of Investor
Relations)
Finsbury +44 (0)20 7251 3801
Gordon Simpson
James Thompson
This announcement contains inside information as defined in
Article 7 of the EU Market Abuse Regulation No 596/2014 and has
been announced in accordance with the Company's obligations under
Article 17 of that Regulation. This announcement has been
authorised for release by the Board of Directors.
About NewRiver
NewRiver REIT plc ('NewRiver') is a leading Real Estate
Investment Trust specialising in buying, managing and developing
essential retail and leisure assets throughout the UK.
Our GBP1.2 billion portfolio covers 9 million sq ft and
comprises 33 community shopping centres, 25 conveniently
located
retail parks and over 700 community pubs. We hand-picked our
assets to deliberately focus on occupiers providing
essential goods and services, and avoid structurally challenged
sub-sectors such as department stores, mid-market
fashion and casual dining. This focus, combined with our
affordable rents and desirable locations, delivers sustainable and
growing returns for our shareholders, while our active approach to
asset management and inbuilt 2.5 million sq ft
development pipeline provide further opportunities to extract
value from our portfolio.
NewRiver has a Premium Listing on the Main Market of the London
Stock Exchange (ticker: NRR). Visit www.nrr.co.uk for further
information.
LEI Number: 2138004GX1VAUMH66L31
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END
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