2009 2 London & Stamford Property Limited Report & - PDF document

London & Stamford Property Limited Report&Accounts 2009

2 London & Stamford Property Limited Report & Accounts 2009 Introduction I am delighted to report London & Stamford’s first acquisitions since IPO. I believe these acquisitions represent outstanding value to London & Stamford. We firmly believe that our access Contents 01 Financial highlights to equity and debt and evidence 02 Chairman’s statement of our ability to execute deals swiftly 05 Property Advisor’s report will allow us to take advantage 10 Board of Directors 11 Advisors to the Company of weakness in the market. 12 Report of the Directors 15 Corporate governance 18 Report of the independent auditors 20 Group and Company Income Statements 21 Group and Company Balance Sheets 22 Group and Company Statements of Changes in Equity 23 Group and Company Cash Flow Statements 24 Notes forming part of the Financial Statements 45 Notice of Annual General Meeting 46 Financial Calendar

London & Stamford Property Limited Report & Accounts 2009 01 Financial highlights 2009 2008 Net income £3.1m £0.6m Profit for the year/period £24.0m £0.4m Investment properties £127.1m £49.4m Share of associates £62.8m – Cash deposits £169.9m £243.6m Bank debt £69.6m £21.8m Net assets £291.7m £277.9m NAV per share 102.3p 97.5p Earnings per share 8.4p 0.14p Adjusted earnings per share 9.5p 0.96p Dividend per share 4.0p 1.6p

02 London & Stamford Property Limited Report & Accounts 2009 Chairman’s statement Results I am delighted to report London The Group generated a profit for the year & Stamford’s first acquisitions since of £24.0 million (2008: £0.4 million). our initial listing (IPO) in 2007. Profit adjusted for the revaluation of investment We have commenced investing our equity properties, deferred taxation and the fair as we believe that, at long last property value of derivatives would be £27.0 million (2008: £2.7 million), comprising as follows: values are becoming more realistic. £m In the last quarter of the year under Profit for the Year 24.0 review, we have bought One Fleet Place, Revaluation of Investment Properties 5.6 EC4 and, together with our joint venture Deferred Taxation (3.9) partner Green Park (formerly Cavendish Fair Value of Derivatives 1.3 Limited), half of the Meadowhall 27.0 Shopping Centre from British Land. Net Assets at 31 March 2009 were £291.7 million Since the year end we have completed (2008: £277.9 million), equivalent to 102.3p per share the acquisition of No 1 Whitehall (2008: 97.5p). Riverside, Leeds and have exchanged The Board recommends a final dividend of 2.0p contracts to acquire the Racecourse per share in respect of the year to 31 March 2009, Retail Park, Aintree and the Somerfield which, when taken with the interim dividend of 2.0p per share paid on 22 December 2008, will produce Distribution Unit, Wellingborough. a total dividend for the year of 4.0p per share I believe these acquisitions represent (period ended 31 March 2008: 1.6p). outstanding value for London & Stamford In accordance with IFRS, the final dividend will be and justify our caution since the IPO in accounted for, following its approval, in the first half waiting for the right opportunities despite of the financial year ending 31 March 2010 an economic recession, characterised and will be paid on 27 July 2009, to shareholders on the register on 19 June 2009. by falling property values, restricted debt availability and increasing occupational risk in the property market. We have been Portfolio able to secure income benefits well ahead Our property advisor, LSI Management LLP, of our expectations at the time of the IPO. continues to seek out new investment opportunities on our behalf and to actively manage our expanding portfolio which at the date of this report comprises the following: New Acquisitions Ownership One Fleet Place, EC4 100% Offices Meadowhall Shopping Shopping Centre, Sheffield 15.7% Centre Raymond Mould No 1 Whitehall Riverside, Chairman Leeds 100% Offices

London & Stamford Property Limited Report & Accounts 2009 03 Our other acquisition in the year was an office Original Portfolio at IPO Ownership building at One Fleet Place, London EC4, Campbell Road, Stoke 100% Industrial for a consideration of £74 million, a high quality on Trent Warehouse development, well let on a long lease at current Elm Park Court & 100% Offices market rent; providing a very good cash on equity Forest House, Crawley return for us. We have recognised a surplus Barracks Road, 100% Retail on revaluation of One Fleet Place since acquisition Newcastle-under-Lyme Warehouse of £7.6 million. Copse Road, Yeovil 100% Mixed Use Since the year end we have acquired a further office Development Site development at No 1 Whitehall Riverside, Leeds, Gillingham Business Park, 100% Mixed Use for £37.6 million, with similar characteristics Kent Development Site of build quality, lease length and current market rent, providing further evidence of our focus on very good Glaisedale Parkway, 100% Industrial income returns on our equity investment. Nottingham Warehouse This week, we have exchanged contracts to acquire The acquisition of our interest in Meadowhall valued two further assets: The 292,000 square feet the shopping centre at £1.175 billion and is net of Racecourse Retail Park, Aintree for a consideration £835 million of debt in the form of a securitised bond. of £61 million; and the Somerfield Distribution Unit, The purchase price to the joint venture, LSP Green Wellingborough for £19.6 million let to the Co-op Park Property Trust (LSPG) inclusive of costs and for an unexpired term of 18.4 years. after the deduction of accrued rents for the period up to 31 March 2009, amounted to £169 million. Borrowings The purchase price is split into two tranches; £122 million was paid on completion and a further At the year end, borrowings amounted to amount of £47 million is payable when Meadowhall £69.6 million, drawn down from our £150 million achieves certain additional income from new lettings facility with HBoS. The increase in the year reflects and rent reviews. the debt funding attached to the acquisition of One Fleet Place. London & Stamford’s interest in LSPG is 31.4% of the joint venture, giving us an effective interest Since the year end, we have secured new debt in Meadowhall of 15.7%. Our share of the cost was financing for our purchase of No 1 Whitehall £39.2 million on completion and £14.8 million Riverside, Leeds from Deutsche Postbank. on payment of the deferred amounts. It is our intention to continue to seek cost effective We consider the acquisition of our interest to debt funding in the market where and so long as be an outstanding acquisition for our shareholders. it remains available, and preserve, or indeed increase, the undrawn balance of our HBoS facility to be ready The carrying value of our interest in Meadowhall for future utilisation alongside our undrawn equity. at the year end is £62.8 million. We have recognised our share of the excess of the fair value of the net assets acquired over the consideration paid of £20.5 million in the income statement as required under IFRS. A further £3.1 million, our share of the profits arising from the joint venture since acquisition, including a surplus on revaluation is also included in the income statement.