RNS Number : 6799G
Speymill Deutsche Immobilien Co PLC
04 February 2010
4 February 2010
Speymill Deutsche Immobilien Company plc
("SDIC" or "the Company")
Trading update
Speymill Deutsche Immobilien Company plc (AIM: SDIC), the pan-German residential property investment company listed on AIM, announces an update in relation to its expected results for the 6 months ended 31 December 2009 and its financing arrangements.
Asset management initiative
The vacancies in the property portfolio remained broadly stable over the final quarter of 2009 as the Company continued its refurbishment programme. In addition, SDIC has concluded the sale of approximately EUR22 million of assets as part of its ongoing asset management initiative. The sale of this package was completed at a premium to the published valuation contained within the results for the year ended 30 June 2009.
Bank facilities
SDIC is in the process of reviewing its banking facilities with its lending banks with a view to securing, proactively, additional financing flexibility which may be required to ensure that the Company remains in compliance with its loan covenants in the near term. The Company confirms that it is currently compliant with all existing terms and covenants of its banking facilities. A further update on these negotiations will be provided at the time of the announcement of the half year results or earlier, if appropriate.
Interest rate swaps
The Company has a number of interest rate swaps outstanding and, in accordance with IFRS, is required to mark these swaps to market at each balance sheet date, irrespective of the intentions of the Company to hold the outstanding swaps to maturity or not (the maturity dates for the swaps being between September 2013 and December 2014). It is important to note that at no stage will the income statement movements, as a result of the swap revaluations, have any cash effect on the Company unless the swaps were to crystallise on their early termination by the Company.
As a result of recent interest rate drops, the accounting value of the swaps as at 31 December 2009 is expected to be negative, with the corresponding loss on the Company's income statement, as a result of the change in value, expected to be approximately EUR9.7 million. Clearly, any further interest rate movements prior to the maturity of the swaps will result in further changes in value and the corresponding profits or losses will again be recognised in future income statements. The swaps are tied to the Euribor 3 month rate which has fallen from 1.099% as at 30 June 2009 to 0.700% as at 31 December 2009. At no stage will the income statement movements, as a result of the swap revaluations, have any cash effect on the Company.
Further details on the above swaps and their revaluation will be provided in the Company's half year results which are expected to be announced in the second half of March 2010.
For more information, please visit http://www.speymilldeutsche.com or contact:
Speymill Property Group Limited +44 1624 640 860
(Manager)
Nigel Caine
Nick Harris
SMP Fund Services Limited +44 1624 682 216
(Administrator)
Vincent Campbell
Smith & Williamson Corporate Finance Limited +44 20 7131 4000
(Nominated Adviser)
Azhic Basirov
Siobhan Sergeant
Fairfax I.S. PLC +44 20 7598 5368
(Brokers)
James King
Andrew Cox
Tavistock Communications Limited +44 20 7920 3150
(Media & Investor Relations)
Jeremy Carey
Simon Hudson
Gemma Bradley
Notes to Editors:
Speymill Deutsche Immobilien Company plc is a pan-German residential property investment company, which listed on the AIM market of the London Stock Exchange in March 2006, raising £170 million. In May 2007, SDIC raised a further EUR250 million through a C share placing. The Euro denominated fund aims to provide investors with an attractive level of income together with the prospect for long-term capital growth.
The German residential market is viewed as attractive to investors due to a number of factors including rising German economic activity and productivity, and the availability of assets at below replacement cost. Acquired properties should, through active management, also have the potential for increased rental rates and accordingly improved capital values and increased yield.
Speymill Property Group Limited is the appointed Manager of SDIC and, in conjunction with the Investment Adviser, Goal service GmbH, it identifies acquisition opportunities for the Company, which fit within its investment criteria.
This information is provided by RNS
The company news service from the London Stock Exchange
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