Portfolio Update

RNS Number : 4915W

Symphony International Holdings Ltd

29 January 2013

 



Not for distribution, directly or indirectly, in or into the United States or any jurisdiction in which such distribution would be unlawful.

29 January 2013

Symphony International Holdings Limited ("SIHL" or the "Company")

Update on Parkway Life Real Estate Investment Trust

The Company is pleased to announce that one of its portfolio companies, Parkway Life Real Estate Investment Trust ("PLife REIT"), released its fourth quarter and full year 2012 financial results.  

PLife REIT made a press release on 25 January 2013, which is reproduced below.

ParkwayLife REIT
NEWS RELEASE
FOR IMMEDIATE RELEASE

PARKWAY LIFE REIT WRAPS THE YEAR UP

WITH SUSTAINED GROWTH

§ Gross revenue up 7.2% to S$94.1 million in FY 2012

§ Net property income up 7.6% to S$86.4 million in FY 2012

§ DPU up 7.5% to 10.31 cents in FY 2012

§ Japanese Yen income hedges extended to derive further stability in distributions

§ Sixth Japan asset enhancement initiative completed at an ROI of 10.0%

TOTAL PORTFOLIO	1 Oct 12 to 31 Dec 12 (4Q 2012) S$'000	1 Oct 11 to 31 Dec 11 (4Q 2011) S$'000	Increase %	1 Jan 12 to 31 Dec 12 (FY 2012) S$'000	1 Jan 11 to 31 Dec 11 (FY 2011) S$'000	Increase %
Gross revenue	23,987	22,847	5.0	94,074	87,763	7.2
Net property income	22,105	20,837	6.1	86,426	80,308	7.6
Income available for distribution (after deducting income retained for capital expenditure)	16,314	14,902	9.5	62,405	58,051	7.5
Available Distribution Per Unit (cents)1 - DPU for the period -Annualised DPU	2.69 10.76	2.47 9.88	9.5 9.5	10.31 10.31	9.60 9.60	7.5 7.5
Annualised Distribution Yield (%), based on closing market price of $2.15 as at 31 December 2012	5.00	4.60	9.5	4.80	4.47	7.5

Note: The number of units used to calculate the Distribution per Unit ("DPU") comprise the number of units in issue as at 31 December 2012 and 31 December 2011 respectively.

Singapore, 25 January 2013- Parkway Trust Management Limited (the "Manager"), as manager of Parkway Life Real Estate Investment Trust ("PLife REIT") is pleased to announce a strong set of results for the fourth quarter ("4Q 2012") and full year ("FY 2012") ended 31 December 2012.

PLife REIT registered gross revenue of S$24.0 million for 4Q 2012, a 5.0% increase from the previous corresponding period ("4Q 2011"). This was primarily due to a full quarter's revenue contribution from the Japan and Malaysia properties acquired in March and August 2012 respectively. Revenue growth was further driven by higher rent from PLife REIT's Singapore properties as rent grew by 6.31% (under the CPI+1% rent review formula) for Year 6 of the lease term that commenced on 23 August 2012.

For FY 2012, gross revenue increased 7.2% from the same period last year ("FY 2011") to S$94.1 million, due to revenue contribution from new properties acquired in 2011 and 2012, and higher rent derived from existing properties, offset by the Japanese Yen depreciation in 4Q 2012. As a result, net property income rose 6.1% and 7.6% year-on-year to S$22.1 million andS$86.4 million for 4Q 2012 and FY 2012 respectively.

Mr Yong Yean Chau, Chief Executive Officer of the Manager said, "We are pleased with the set of results that we have achieved for the year despite challenging market conditions. Our DPU for 4Q 2012 reached another historical high and has grown 69.2% since listing. The success of our efforts bears testament to our strategy to bolster the strength of our property portfolio whilst effectively managing our finances."

Finance costs rose marginally by 1.7% for 4Q 2012, mainly due to additional financing costs incurred to finance the properties acquired in March and August 2012 and higher amortisation of transaction cost relating to debt facilities. This was offset by the depreciation of the Japanese Yen over the quarter. On a full-year basis, for FY 2012, finance costs fell 2.4% despite the growth of the portfolio, helped largely by the lower locked-in hedged rates arising from the extension of interest rate hedges which was completed in August 2011.

As a result of the yield accretive acquisitions, higher rent from the Singapore properties, savings from lower financing costs over the year and a one-off gain on tax adjustment by the Inland Revenue Authority of Singapore (representing the difference between the taxable income previously distributed and the quantum finally agreed with the Inland Revenue Authority of Singapore ("IRAS") for the Years of Assessment 2008 to 2011 and had been adjusted under the rollover adjustment mechanism agreed with the IRAS. This represents a gain of approximately S$0.2 million and S$0.7 million for 4Q 2012 and FY 2012 respectively), distributable income for 4Q 2012 and FY 2012 increased 9.5% and 7.5% respectively to S$16.3 million and S$62.4 million. DPU for 4Q 2012 grew from 2.47 cents in the same period last year to 2.69 cents, which in turn saw DPU for FY 2012 grow by 7.5% to 10.31 cents.

Stable and defensive fundamentals to support continual growth

PLife REIT continues to enjoy the effects of the interest cost savings from the lower locked-in hedged rates arising from the extension of interest rate hedges which was completed in August 2011. To ensure stable distributions to its Unitholders, PLife REIT has in place a natural hedge strategy to match its assets and liabilities that are denominated in Japanese Yen. In 2012, it extended its Japanese Yen-denominated net income hedge for five years till the first quarter ended 31 March 2017 ("1Q 2017"), insulating it from volatility in the Japanese Yen.

In addition, with the completion of the pre-emptive refinancing exercise in 25 June 2012 (refer to announcement dated 2 August 2012 for details), PLife REIT will have no refinancing needs for its existing total debt portfolio until FY2014. As at 31 December 2012, PLife REIT's weighted average debt maturity period stood at 2.45 years. Its gearing stood at 32.9%, well below the 60% gearing limit imposed under the Monetary Authority of Singapore's Property Funds Appendix, representing ample debt headroom for future acquisition opportunities.

Further organic growth to deliver additional value

On 30 November 2012, PLife REIT completed its sixth Asset Enhancement Initiative ("AEI") for its Japan portfolio, involving the creation of a central kitchen at Sawayaka Obatake Nibankan to facilitate the catering and preparation of food for other K.K. Sawayaka Club (as at 31 December 2012, K.K. Sawaya Club operates 10 out of PLife REIT's 32 nursing homes) facilities in the vicinity. At a low capital outlay of approximately JPY12.0 million (S$0.2 million - based on an assumed exchange rate of S$1.00 to JPY63.45), the AEI yield attractive returns for PLife REIT as gross rent for the unexpired lease term of approximately 17.5 years (with effect from 1 December 2012) would increase by 5.04%, translating to a return on investment of 10.0%.

Mr Yong concludes, "Moving into 2013, we will build on our past successes in delivering both organic and inorganic growth. We will continue exploring the market for compelling opportunities that may arise in order to benefit from the growing demand for quality healthcare services in the Asia-Pacific region."

                                                                        - ENDS -

___________________________________________________________________________________

About Parkway Life REIT

Parkway Life Real Estate Investment Trust ("PLife REIT") is one of Asia's largest listed healthcare REITs by asset size. It invests in income-producing real estate and real estate related assets that are used primarily for healthcare and healthcare-related purposes (including but are not limited to, hospitals, healthcare facilities and real estate and/or real estate assets used in connection with healthcare research, education, and the manufacture or storage of drugs, medicine and other healthcare goods and devices).

PLife REIT owns a well-diversified portfolio of 37 properties with a total portfolio size of approximately S$1.4 billion as at 31 December 2012. It owns the largest portfolio of strategically-located private hospitals in Singapore comprising Mount Elizabeth Hospital, Gleneagles Hospital and Parkway East Hospital, covering an aggregate of 730 beds (as at 31 December 2012). In Japan, has 33 assets, including one pharmaceutical product distributing and manufacturing facility in Chiba Prefecture as well as 32 high quality nursing home and care facility properties in various prefectures. It also owns strata-titled units/lots at Gleneagles Medical Centre Kuala Lumpur in Malaysia.

For media queries, please contact: Kreab Gavin Anderson Tel [phone] Jenny Yeo / Clarence Koh Mobile: [phone] Email: [e-mail] / [e-mail] This press release is for information only and does not constitute an invitation or offer to acquire, purchase or subscribe for units in Parkway Life Real Estate Investment Trust ("PLife REIT" and the units in PLife REIT, the "Units"). The value of the Units and the income derived from them may fall as well as rise. The Units are not obligations of, deposits in, or guaranteed by, Parkway Trust Management Limited, as Manager of PLife REIT, or any of its affiliates. Investors have no right to request the Manager to redeem their Units while the Units are listed. It is intended that Unitholders of PLife REIT may only deal in their Units through trading on Singapore Exchange Securities Trading Limited (the "SGX-ST"). Listing of the Units on the SGX-ST does not guarantee a liquid market for the Units. The past performance of PLife REIT or the Manager is not necessarily indicative of the future performance of PLife REIT or the Manager. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested.

About Symphony International Holdings

Symphony International Holdings (LSE:SIHL) is a London listed strategic investment company that invests in consumer businesses and develops luxury branded real estate, hospitality and healthcare ventures which are principally in Asia. It offers a way for investors to gain exposure to the rising disposable incomes and wealth in fast growing economies. Symphony's objective is to provide superior capital growth by investing in high quality companies and forming long-term business partnerships with talented entrepreneurs. Symphony is managed by Symphony Investment Managers which has a team of investment professionals with a broad range of expertise - many of them have been working in Asia for more than 25 years. For more information please visit our website at www.symphonyasia.com

No representation or warranty is made by the Company as to the accuracy or completeness of the information contained in this announcement and no liability will be accepted for any loss arising from its use.

This announcement is for information purposes only and does not constitute an invitation or offer to underwrite, subscribe for or otherwise acquire or dispose of any securities of the Company in any jurisdiction. All investments are subject to risk. Past performance is no guarantee of future returns. Prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decisions.

This announcement is not an offer of securities for sale into the United States. The Company's securities have not been, and will not be, registered under the United States Securities Act of 1933 and may not be offered or sold in the United States absent registration or an exemption from registration. There will be no public offer of securities in the United States.

End of Announcement

 

END

 

 

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