9 December 2019 Circle Property Plc Interim results for the six - PDF document

9 December 2019 Circle Property Plc Interim results for the six months ended 30 September 2019 Well positioned to deliver FY expectations of strong NAV growth Circle Property Plc (AIM: CRC) (“Circle” or the “Company”) , which invests in, develops and actively manages well-located regional office assets today announces its results for the six months to 30 September 2019. In the period, the Company has been actively building momentum into the business. Circle has established a strong pipeline of well located, income generating assets which, with our active asset management expertise, are expected to deliver strong returns in the second half. Circle’s current portfolio, which has been independently valued at £135.6 million as at 30 September 2019, is 99% focused in the office sector and has no exposure to the retail sector. All of our properties are geographically located in favourable regions with 89% in Birmingham, Milton Keynes, Maidenhead and Bristol. These results demonstrate the consistent underlying strength of the regional office market which is underpinned by Permitted Development Rights and Circle’s ability to identify sites which offer sustainably strong rental returns and value enhancement. Financial highlights: Strong rental income; investment in property portfolio • Unaudited estimated NAV per share of £2.78 (30 September 2018: £2.75, 31 March 2019: £2.77), representing an 87% increase since IPO in February 2016 • 7.2% increase in annualised contracted rental income to £8.2 million (31 March 2019: £7.6 million), with a further £598,478 of contracted rent since period end • Interim dividend up 10% to 3.3p (30 September 2018: 3.0p), maintaining the Company's progressive dividend policy • Property portfolio valuation increased to £135.6 million (31 March 2019: £124.6 million), largely due to Company's largest acquisition to date: the £14.6 million purchase (plus costs) of Concorde Park, Maidenhead • Since IPO, Circle has delivered a NAV compound average growth rate of 23% and a total return compound average growth rate of 26%, making Circle one of the top-performing public real estate companies Operational highlights: largest acquisition since IPO driving uplift in contracted rental income • K2, Milton Keynes - letting of 20,482 sq ft to Grand Union Housing, contractual rent of £352,625 pax on a 10-year lease with a CPI rent review in the fifth year • Concorde Park, Maidenhead - acquisition of 71,500 sq ft business park for £14.6 million. Contracted passing rent (excluding rent free) £627,372 pax with a reversion to £1.55 million Post HY 2020 highlights: Continued momentum • Victory House, Northampton – re-geared lease with Regus for a further 12 years, increase in contracted rental income to £360,000 per annum of which 30% will be based upon turnover • Concorde Park, Maidenhead – completed two lettings totalling approximately 21,000 sq ft increasing the contracted passing rent (excluding rent free) by a further £485,234 pax. Total gross contracted rental income at the site has increased by 76% since acquisition by the Company to over £1.1 million per annum with a gross rental income target of over £1.55 million per annum. The speed of these lettings since acquisition has been achieved by the Company's asset management expertise • 141 Moorgate, London EC2 – letting of the third floor to Suede Labs Ltd at £60,264 per annum • Elizabeth House, 56-60 London Road, Staines – letting of the ground floor to Accent Catering Ltd at £52,980 per annum

• K3, Milton Keynes – refurbishment on track to commence in December 2019. Once completed the 13,500 sq ft office building will be offered to let at an ERV of approximately £270,000 pax • 135 Aztec West, Bristol – refurbishment on track to commence in January 2020. Once completed the 13,258 sq ft self- contained office will be offered to let at an ERV of approximately £245,300 pax John Arnold, CEO of Circle Property Plc, commented: "Circle's portfolio now comprises 99% (by value) regional offices, which is highly reversionary, and has no exposure to retail property. Our focus on “added value” rather than initial yield continues to reap rewards with income generation arising from judicious capital expenditure. “ In the six months ended 30 September and post period end, we have been investing in the pipeline, increasing our rental growth and we are on track to deliver expectations for the full year. In the first half, the pace of lettings has increased, with over £950,000 of newly-contracted rents being completed to date since the start of the year. This bodes well for an uplift in valuation at the year end and we look forward to continuing our positive momentum.” Contacts: Circle Property Plc +44 (0)207 930 8503 John Arnold, CEO Edward Olins, COO Cenkos Securities +44 (0)207 397 8900 Azhic Basirov Katy Birkin Radnor Capital +44 (0)203 897 1830 Joshua Cryer Iain Daly Camarco +44 (0)203 757 4980 Ginny Pulbrook Tom Huddart About Circle Property Plc Circle is amongst the best performing quoted UK real estate companies by NAV total return (NAV growth and dividend) having delivered consistent returns with 87% NAV growth since IPO in 2016 in absolute terms. Circle focusses on acquiring assets in regional cities, many of which have significant office supply constraints, and on office assets with active management potential (refurbishment opportunities, under-rented or vacant properties or short leases), rather than just maximising initial rental yields. Circle is not a Real Estate Investment Trust (REIT) and can actively recycle proceeds from asset sales into its refurbishment and redevelopment pipeline, as well as future investment opportunities, therefore targeting a broader range of returns for shareholders, which are primarily driven by NAV growth. As well as already delivering substantial increases in NAV, the Company's portfolio has significant reversionary potential with current total estimated rental values of approximately £10.9 million per annum, compared to contracted rent of £8.2 million at 30 September 2019. The Company has a portfolio of 15 regional commercial property investment and development assets in the UK valued at £135.6 million as at 30 September 2019.