Redefine International’s adjusted NAV rose from 40.5p to 41.7p over the year to the end of August 2015. Earnings per share slipped from 3.3p to 3.2p but the dividend was upped from 3.2p to 3.25p.
The slip in earnings was the result of cash drag in the portfolio in the second half of the period as there was a gap between raising money in an equity issue and buying a large portfolio of property from Aegon UK. They’ll need more cash to complete the second part of this acquisition and they are weighing up whether to raise more equity (in which case their South African shareholder, Redefine Properties, will stump up £70m) or borrow more cash – Redefine Properties has offered a £135m bridging loan which they can refinance within three months or convert into equity in that portfolio to form a 50:50 jv.
Within the portfolio occupancy increased from 97.6% to 98.1%. The weighted average unexpired lease term is 8.1 years. The LTV ratio fell to 40.7% from 48.1% and the cost of debt dropped 30bps to 3.9% (all before the impact of the transaction described above).
RDI : Redefine mulling financing options for Aegon deal