QuotedData’s morning briefing 26 July 2024 – LWDB, TMI, GCP, SUPR, SGRO

In QuotedData’s morning briefing 26 July 2024:

• Law Debenture (LWDB) has published its interim results for the six months ended 30 June 2024, during which it provided an NAV total return (with debt and Independent Professional Services (IPS) business at fair value) of 9.7%, and share price total return of 7.7%, both outperforming its All-Share benchmark, which it says returned 7.4%. LWDB says that the IPS business performed well with revenue up 8.8%, profit before tax up by 9.2% and valuation up 4.9% to £221m (compared to 30 December 2023). Ongoing charges continues to be low at 0.48%, versus an industry average of 1.21%. LWDB declared a first interim dividend of 8.0 pence per ordinary share, paid in July 2024, representing an increase of 4.9% over the prior year’s first interim dividend. LWDB says that its Board intends for each of the first three interim dividends for 2024 to be equivalent to a quarter of Law Debenture’s total 2023 dividend of 32.0 pence per ordinary share and that continued good performance and growth of the IPS business supports the Board’s intention to maintain or increase the total dividend in 2024.
• Taylor Maritime Investments (TMI) has issued a quarterly trading update. As at 30 June 2024 its unaudited NAV was US$1.52 per Ordinary Share compared to $1.48 per share as at 31 March 2024 and it has declared an interim dividend in respect of the period to 30 June 2024 of 2 US cents per share. The NAV total return for the quarter was 4.3%, with charter rates and asset values remaining firm. TMI is set to own 100% of Grindrod Shipping Holdings following approval of the Selective Capital Reduction. The combined TMI and Grindrod fleet generated average time charter equivalent (TCE) earnings of US$13,264 per day for the quarter (versus US$12,430 per day for the quarter ended 31 March 2024; an increase of c.7%). At quarter end, the combined average TCE was US$14,707 per day (versus US$13,132 at 31 March 2024; an increase of c.12%). TMI says that the combined fleet, largely maintained on short period charters, was well-positioned to take advantage of the improving market with a sizeable portion fixed at higher market rates during the period. Earnings improved quarter-on-quarter and the fleet outperformed its benchmark indices by US$835 per day (8%) for the combined Handysize fleet and US$937 per day (6%) for the Supra/Ultramax fleet.
• GCP Infrastructure (GCP) has issued a trading update for the quarter ended 30 June 2024. At the end of the quarter, its NAV per share was 107.58p, representing a decrease of 0.04 pence per ordinary share over the quarter. As announced on 26 April 2024, GCP completed the disposal of its interest in loan notes secured against Blackcraig Wind Farm at a 6.4% premium to its valuation at 31 March 2024. This disposal generated c. £31m of cash that was used to pay down its revolving credit facility and led to an NAV uplift of c. 0.2p pence per share. At 30 June 2024, GCP had £65m (31 March 2024: c. £96m) outstanding under its revolving credit arrangements, representing a net debt position of c. £51.3m (31 March 2024: c. £78.3m). GCP says that an uplift in forecast electricity prices, driven by higher power prices forecast in the short-term, led to increasing forecast cash distributions from certain renewable energy investments, contributing c. 0.45p per share, which was offset by increases to discount rates, as advised by its independent valuation agent. This led to a reduction of c. 0.6p per share, resulting in the weighted average discount rate used by GCP to value its investment portfolio increasing to 7.81% at 30 June 2024 (31 March 2024: 7.78%). GCP says that the portfolio continues to perform materially in line with expectations. It has announced a dividend of 1.75p per share for the period from 1 April 2024 to 30 June 2024, which is in line with its annual dividend target of 7p per share. This dividend will be paid on 9 September 2024 to holders of ordinary shares recorded on the register as at the close of business on 9 August 2024.
• Supermarket Income REIT (SUPR) has completed a £170m debt refinancing through a private placement debt issuance and a new unsecured bank facility. The company has signed an agreement with a group of institutional investors for a private placement of €83m of new senior unsecured notes, which have a maturity of seven years and a fixed rate coupon of 4.44%. Proceeds will be used to refinance euro drawings under an existing secured revolving credit facility with HSBC, which had been used to fund the recent acquisition of a portfolio of 17 stores from Carrefour. SUPR has also refinanced its existing £97m secured debt facility with Deka through a new £100m unsecured debt facility with ING Bank N.V. The new ING facility comprises a £75m term loan and a £25m revolving credit facility. The interest-only facility has a maturity of three years and has two one-year extension options at the lender’s discretion. The facility is priced at a margin of 1.55% over SONIA and benefits from forward starting hedges, which cap the interest rate at an all-in cost of 3.0% until January 2026. Following the debt refinancing, the company has a pro-forma LTV of 37%.
• SEGRO (SGRO) posted a slight decline in adjusted NAV of 1.8% to 891p over the six months to 30 June 2024, mainly due to the impact of a £907m equity placing during the period. Overall, valuations were flat at £17,817m, with a positive performance in the UK offset by a small decline in Continental Europe, mostly due to modest outward yield shift. A total of £48m of new headline rent commitments were signed during the period, including £17m of new pre-let agreements and a 28% average uplift in rent reviews and renewals. This contributed to a 7% increase in net rental income to £306m, driven by like-for-like rental growth of 5.3% and development completions. LTV reduced to 30% (Dec 2023: 34%), with average cost of debt of 2.7% and no major maturities until 2026. The group’s interim dividend increased 4.6% to 9.1p.

We also have:

• Annual results from Invesco Asia.
• Annual results from Jupiter Green.