Acquisitions boost Stenprop

Stenprop CEO Paul Arenson said the group had delivered good growth to date which was underpinned by its diversified, high-quality and defensive portfolio that was internally managed to extract maximum value.

Stenprop, the Bermuda Stock Exchange-listed property company with a recent secondary listing on the JSE’s AltX, on Thursday posted strong annual financial results, thanks to the "transformational" acquisition of Stenham's property portfolio.

The Stenham deal in October 2014 included the acquisition of 45 buildings in Germany, Switzerland and the UK, through the issue of Stenprop shares worth EUR318.8 million at EUR1.37 per share.

Releasing its latest results, Stenprop said its EPRA (European Public Real Estate Association) net asset value (NAV) of EUR1.65 per share for the full-year ended March 2015 represented an increase of 20.44% on the EUR1.37 issue price of the shares.

Pro forma diluted adjusted EPRA earnings per share was EUR9.81 cents, equating to a 7.16% earnings yield on the issue price of EUR1.37.

A final dividend of 4.2 cents was declared for the six months following the Stenham transaction.

Stenprop CEO Paul Arenson said the group had delivered good growth to date which was underpinned by its diversified, high-quality and defensive portfolio that was internally managed to extract maximum value.

"The acquisition of the Stenham portfolio was transformational for the company and gave us the platform from which to continue driving value creation by executing several strategic transactions," Arenson said.

At March 2015, the portfolio was independently valued at EUR807 million and was split 42% in the UK, 38% in Germany and 20% in Switzerland.

The gross lettable area is about 240,500 square meters generating an annualised gross rent of EUR52.4 million, predominantly in the office and retail sectors, which account for 51% and 34% of rental income respectively.

During the period under review, Stenprop disposed of Chiswell Street, a multi-let office block located in London for a price of GBP48 million, realising a net gain of GBP3.5 million and acquired Trafalgar Court, a modern A-grade multi-let office building in Guernsey for GBP61.4 million.

After completing a capital raise of EUR35 million in South Africa in March 2015, Stenprop acquired in May a 50% interest in 25 Argyll Street, a GBP75 million multi-let office building located in the heart of London's West End, and notarised the acquisition of Hermann Quartier, a retail shopping centre located in the high street of Neukölln, Berlin for EUR22.7 million.

Patsy Watson, chief financial officer of Stenprop, said the group had started the year with a healthy cash position.

"We will continue to focus on nurturing our diversified portfolio of quality investment properties to deliver sustainable and growing earnings, distributions and capital growth, and will seek to bolster this with strategic acquisitions. Based on current economic conditions, we expect to deliver adjusted EPRA EPS in excess of 10.30 cents per share and to make two distributions totalling 8.5 cents per share for the year ended 31 March 2016," Watson said.