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MSP - MAS Plc - Abridged Audited Consolidated Results for the Year Ended 28
February 2012
MAS PLC (Incorporated in the Isle of Man)
(Registration number 2893V) (Registered as an external company in the
Republic of South Africa)
(Registration number 2010/000338/10)
JSE share code: MSP
ISIN: IM00B4LFGH00
("MAS" or "the company" or "the group")
Abridged Audited Consolidated Results for the Year Ended 28 February 2012
Highlights
- Final dividend of 1,60 euro cents per share approved
- Share capital more than doubled to Euro42,154 million
- Property portfolio now at Euro53,6 million
- Proposed capital raising in first half of 2012
MAS is a real estate investment company with a portfolio of commercial
properties in Western Europe. The company aims to provide investors with an
attractive, sustainable euro-denominated dividend and strong growth in value
over time through its acquisition and asset management strategy. The current
investment focus is on Germany, Switzerland and the United Kingdom. The
company`s primary listing is on the Euro MTF market of the Luxembourg Stock
Exchange. It has a secondary listing on the Alternative Exchange of the JSE.
Reporting Currency
The company`s results are reported in euro.
Business Review
The macro-economic concerns that have plagued the euro zone for the past year
have begun to abate, with investors` concerns now focused mainly on the
damaging impact of inflation fuelled by high commodity prices driven in turn
by Asian demand. MAS took advantage of the opportunities created by these
market conditions to extend its portfolio of property investments. This it
did primarily through acquisitions from banks with defaulting loans where it
could purchase properties at significant discounts to their original loan and
market values and thus with excellent up-side potential. The properties
listed below were acquired in the UK in the second half of the reporting
period.
Sauchiehall property
MAS has completed the acquisition of 154-160 Sauchiehall Street, Glasgow, an
A-class retail building close to Buchanan Galleries, which anchors the north
end of the city`s prime retailing thoroughfare of Buchanan Street. Glasgow is
Scotland`s largest city and the UK`s largest retail centre after London.
The property was acquired with a five-year rental guarantee from EMI Group
plc, parent company of the present tenant, HMV UK. The building thus offers a
secure income stream but also strong asset management opportunities for the
future. No debt was utilised to fund the acquisition although debt funding
might be sought at a later stage. The purchase price was Euro5 905 500 (GBP5
000 000), before stamp duty and acquisition expenses.
Santon North property
MAS has acquired a prime 14,5 acre site for mixed-use redevelopment in the
town of Lewes in Sussex. The purchase price was Euro6 850 380 (GBP5 800 000),
before stamp duty and acquisition expenses, and no debt was utilised to fund
the acquisition.
The directors believe the size and central location of this property in the
heart of a thriving town in the south of England, offers significant value
for investors through a redevelopment incorporating retail, hospitality,
commercial and residential components.
The company has entered into a joint venture agreement with development
partners Santon Developments plc who underwrite an income of 8% on funds
injected into the investment. This will facilitate the continued payment of a
dividend while the development value is being extracted.
Caltongate investment
MAS has invested Euro3 561 660 (GBP3 000 000) in Artisan Investment Projects
10 Limited ("Artisan IP 10"), the acquisition vehicle of a key development
site in the heart of Edinburgh`s old town, thereby acquiring 37,5% of the
investment company. Artisan IP 10 is managed by a joint venture of Artisan
Real Estate Investors Limited and Atterbury Asset Managers Limited.
The Caltongate property represents a substantial development opportunity in
the most prominent gap site in Edinburgh`s city centre. Planning is already
in place for about 640 000 sq ft (59 463 mSquared) of office, hotel, retail
and residential uses on the site and construction work is expected to start
in the third quarter of 2012 on a pre-let basis. The directors are excited
about the enormous potential of this development, but have nevertheless
limited the size of the investment by MAS due to the lack of initial income
during the development phase.
As a result of these acquisitions, the portfolio now consists of the
following:
Valuation
As at
Euro`000 Sector
28/02/12
DPD property Logistics 18 953
Aldi portfolio Food retail 9 930
Metchley Hall Student residential 8 633
Santon North property Industrial/development 6 850
Sauchiehall property Retail 5 669
Caltongate investment Development 3 582
Total 53 617
Prospects
MAS is at present realising the innate value of the properties acquired in
the past 12 months in line with the strategy devised for each of them when
they were acquired. MAS is also negotiating a further acquisition which will
be funded by another capital raising. This property has a substantial total
return potential due to its location and the discount negotiated on land
value, and the possibility that more valuable mixed-use planning consents can
be obtained for the 10-acre site.
The directors are confident they will be able to continue investing the
capital of the company in the excellent opportunities that have become
available in the current market conditions. In doing so they want to grow the
company`s capital base.
Dividend
The directors have approved a final dividend for the year of 1,60 euro cents
per share. This brings the total distribution for the year to 3,74 euro cents
per share. Due to the implementation of the new Dividends Tax
in South Africa, the board has decided to defer the declaration of the final
dividend until the impact on MAS has been determined. Details and timing of
the final dividend will be published in due course.
Proposed capital raising
The company is in the process of securing additional funding, subject to
compliance with regulatory requirements in South Africa, Luxembourg and the
Isle of Man. In this regard MAS has received a commitment in principle from
Atterbury Investment Holdings Limited, one of its core shareholders, of ZAR
50 million. This is expected to further diversify the portfolio and enhance
income returns to shareholders.
Basis of preparation
These results have been prepared in accordance with International Financial
Reporting Standards, including IAS 34 - Interim Financial Reporting, the
rules of the Luxembourg Stock Exchange and the Listing Requirements of the
JSE Limited.
Accounting policies
The financial statements on which these abridged results have been based,
have been audited by the group`s auditors, KPMG Audit LLC, and their
unqualified audit report is available on request from the company secretary
and will be released together with the annual report. The accounting policies
adopted are consistent with those of the previous year.
Abridged consolidated statement of comprehensive income
Audited Audited
Year ended Year ended
(Euro`000) 28/02/12
28/02/11
Income
Net rent received 2 123 1 711
Finance income 714 330
Income from associate 74 -
Exchange differences 167 276
Expenses
Investment adviser`s fees (457) (235)
Operating expenses (1 060) (690)
Fair value adjustments (1 622) 1 930
Results from operating activities (61) 3 322
Net interest expense (673) (686)
(Loss)/Profit before taxation (734) 2 636
Taxation (37) (5)
(Loss)/Profit for the year (771) 2 631
Other comprehensive income
Currency translation adjustments 264 420
Total comprehensive (loss)/income (507) 3 051
(Loss)/Earnings per share (cents)* (2.18) 14.1
Headline (loss)/earnings per share (cents)* (2.46) 3.4
Weighted average number of ordinary
shares in issue (`000`s) 35 421 18 666
Adjusted core income 1 108 813
*There are no potentially dilutive instruments in issue.
Abridged consolidated statement of financial position
Audited Audited
As at As at
(Euro`000) 28/02/12
28/02/11
Investment property 50 036 30 202
Investment in associate 1 101 -
Loans to associate 2 480 -
Plant and equipment 27 -
Current assets 10 089 9 120
Total assets 63 733 39 322
Share capital 42 154 19 763
Retained loss (2 069) (451)
Currency translation reserve 684 420
Shareholder equity 40 769 19 732
Long-term loans 17 813 17 689
Financial instruments 2 478 853
Current liabilities 2 673 1 048
Total liabilities 22 964 19 590
Total equity and liabilities 63 733 39 322
Net asset value per share (cents) 96.7 99.8
Number of shares in issue (`000`s) 42 154 19 763
Abridged consolidated statement of cash flows
Audited Audited
Year ended Year ended
(Euro`000) 28/02/12
28/02/11
Operating cash flows 1 021 1 568
Investing activities (22 289) (3 337)
Financing activities - debt and capital raised 20 399 7 409
Cash and equivalents at the beginning of the year 6 612 1 528
Currency translation differences 1 (556)
Cash and equivalents at year end 5 744 6 612
Abridged consolidated statement of changes in equity
Currency
Share Retained translation
(Euro`000) capital loss reserve
Total
28 February 2010 9 310 (2 687) - 6 623
Issue of shares 10 453 - - 10 453
Profit for year - 2 631 - 2 631
Dividends paid - (395) - (395)
Currency translation
adjustment - - 420 420
28 February 2011 19 763 (451) 420 19 732
Issue of shares 22 391 - - 22 391
Loss for the year - (771) - (771)
Dividends paid - (847) - (847)
Currency translation
adjustment - - 264 264
28 February 2012 42 154 (2 069) 684 40 769
Supplementary information
Reconciliation of (loss)/profit after tax to core income and adjusted core
income (unaudited)
Year Year
ended ended
(Euro`000) 28/02/12
28/02/11
(Loss)/Profit after taxation (771) 2 631
Adjusted for
Fair value adjustments 1 622 (1 930)
Fair value adjustments in associate (83) -
Unrealised exchange differences (167) (239)
Fundraising and structure costs 482 269
Non-distributable interest expense - 82
Core income 1 083 813
Santon North income shortfall guarantee 25 -
Adjusted core income 1 108 813
25 April 2012
JSE Sponsor: Java Capital
Date: 25/04/2012 15:24:24 Supplied by www.sharenet.co.za
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