Half year results for the six months ended 31 December 2017

February2018

Town Centre Securities PLC today announces its results for the six months ended 31 December 2017

Robust results and strengthened portfolio following period of considerable change

Financial Highlights
• Net assets per share up 4.3% since 30 June 2017 at 375p (2016: 355p; 30 June 2017: 359p)
• Statutory profit before tax up £9.8m to £12.4m (2016: £2.6m), including £6.4m gain from net movement on investment property valuation
EPRA profit before tax decreased 4.6% to £4.0m (2016: £4.2m) following strategic disposals
EPRA earnings per share at 7.6p (2016: 8.0p), a decrease of 4.6%
• Interim dividend of 3.25p (2016: 3.25p)
• Loan to value ratio of 47% (2016: 50%; 30 June 2017: 49%)

Operational Highlights
• Like-for-like investment portfolio value increased by 0.3% (30 June 2017: 1.4% decrease)
• Total portfolio value increased by 2.4% (30 June 2017: flat)
• Like-for-like passing rent up by 2.2% (30 June 2017: 2.3%)
• New net income of £0.3m from the ibis Styles hotel is in addition to this
• Rent receipts for the current quarter 99% collected within four days of the quarter start
• Merrion Centre trading remains strong and we continue to grow its rental income
• CitiPark continues to grows its revenues and profits

Latest phase of development programme successfully delivered
• Completion of ibis Styles and Premier Inn hotels in Leeds announced last year
• Merrion House development achieved practical completion on 29 January 2018, on time and budget
• This completes a £70m ten-year Merrion Centre development and improvement programme

Significant pipeline of development opportunities in place including
• Burlington House, a 91-unit residential development in Manchester’s Piccadilly Basin is under construction with practical completion expected in May 2019
• Eider House, the second Piccadilly Basin residential development, has detailed planning approval
• Recently announced joint venture with Leeds City Council for construction of an 128 unit apart-hotel with retail units alongside Leeds City Market and Victoria Gate

Proceeds from capital disposals recycled into development programme
• Disposals made during H1 2018 have totalled £7.7m, taking sales over the last c. 12 months of five properties sold for over £25m in total, all at, or above, valuation
• The disposals have provided capital to invest in our development programme
• On an annualised basis the combination of our two new hotels in Leeds and the increase in Merrion House rents will more than offset the £1.5m income lost due to these disposals

CitiPark performs strongly
• The CitiPark business continues to deliver income and profit growth year on year, with promising improvements being seen in our more recently acquired operations
• Operating income of £5.8m is 5% up year on year, with operating profit of £2.1m up 1% despite the pressures of higher business rates costs
• We have recently taken a further 5% stake in YourParkingSpace.co.uk, taking our share to 15%. TCS is very excited about the prospects of this business, a website and mobile application that matches customers to available car parking spaces across the UK

Investing in future growth
• Continued strengthening of the Board and management team with the appointment of Jeremy Collins as an independent Non-Executive Director
• Incurred professional fees relating to our new developments and pipeline projects as we invest in the future growth of the business
• Enhanced our investor relations through the appointment of Edison, the investment research provider, and RMS, the investment engagement specialists

Commenting on the results, Edward Ziff, Chairman and Chief Executive said:

“We are very pleased with the results for the first half of the year, with an increase in the value of our portfolio driving an improved statutory profit. To have maintained EPRA profitability close to last year’s levels, despite a significant level of strategic disposals and continued investment in our business, demonstrates the strength of the recently completed development programme.
“We continue to successfully progress considerable change within our portfolio. The combination of asset recycling, intensive asset management, and a strong development pipeline ensure that our future potential is being enhanced, whilst providing new opportunities for growth in income and capital values. These opportunities require funding, and having self-funded over £85m of investment in recent years, we are exploring how we might fund investments in our future growth.

“The strength of our portfolio, and the success of the most recent development phase have allowed us to be bold in the sale of more mature assets. Furthermore, the strength of our CitiPark business continues to support financial delivery, whilst also bringing new opportunities such as YourParkingSpace.co.uk. We look forward to the future with confidence.”

To view and download Announcements and Notice of Results please visit:
tcs-plc.co.uk/announcements

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Town Centre Securities PLC (TCSC.L) 277.90 +2.90 Last updated: 14/08/2018 at 09:36