1,110.00p

Share price at 09:33

2015 Full-Year Results

26 February 2016

Full-Year results for the year ended 31 December 2015

KWE delivers 14.6% NAV growth and 37% uplift in prospective dividend.

Kennedy Wilson Europe Real Estate Plc (LSE: KWE), an LSE listed property company that invests in direct real estate and real estate loans in Europe, today announces its audited full-year results for the year ended 31 December 2015.

  

  31 December
2015
31 December
2014(1)
Change
(%)
Net operating income (NOI) (£m) 130.1 50.7 156
Net profit after taxation (£m) 259.0 78.5 230
Adjusted earnings (£m) 65.0 23.1 181
Adjusted earnings per share (p) 47.9 25.9 85
DPS paid (p) 35.0 6.0 483
Quarterly DPS announced (p) 12.0 7.0 71
  31 December
2015
31 December
2014(1)
Change
(%)
Adjusted NAV (£m) 1,596.5 1,386.9 15
IFRS NAV (£m) 1,629.2 1,389.9 17
Adjusted NAV per share (p) 1,174.5 1,025.2 15
IFRS NAV per share (p) 1,198.5 1,027.4 17
Valuation uplift (£m) 211.8 57.9 266
Net debt (£m) 1,109.6 111.6 894
Loan to value (LTV) (%) 39.7 7.5 32.2pp

Footnotes: 1. Period from incorporation to 31 December 2014

Operational highlights

  • Portfolio valued at £2,792.7 million, generating annualised NOI of £160.6 million, across 302 properties
  • Acquisitions of £1,135.5 million, across 217 properties and two loan portfolios, delivering a yield on cost of 7.1%
  • Like-for-like portfolio valuation surplus +11.5%  (£157.1 million), with like-for-like NOI growth +4.1%
  • Continued asset management momentum having contracted £7.6 million of annualised NOI over the year, across 233 leasing transactions and 1.3 million sq ft, beating valuers’ ERVs by 7.7%
  • Secure income supported by 96.0% occupancy (+5.1 percentage points), and WAULT of 7.3 years (9.2 to expiry)
  • Took title to two office buildings in Dublin, one retail park in Cavan and one residential block in London, converting loans to direct real estate worth £139.9 million
  • £300 million disposal programme on track with £124.4 million of sales completed across 35 properties at an average exit yield of 5.7% generating a return on cost of 22.9%

Financial highlights:

  •  +14.6% increase in Adjusted NAV per share to 1,174.5 pence (Dec-14: 1,025.2 pence)
  •  +20% increase in interim quarterly dividend to 12.0 pence per share or 48.0 pence per share annualised, representing +37% increase in prospective annualised dividend compared with 35.0 pence per share, or £47.5 million of dividends paid over the year
  • Successful issue of seven-year debut and ten-year follow-on senior unsecured bonds totalling £594.8 million in June and November 2015 and simultaneous rating by Standard and Poor’s of  BBB for both the Company and the bonds
  • Unsecured debt improved to 41% of total debt and fixed and hedged debt to 85%, extending out the term to maturity by 12 months to 5.9 years with ample financing liquidity of £551.5 millioAttractive weighted average cost of debt of 2.9%

Post year-end achievements:

  • £137.5 million of disposals completed since 31 December 2015, bringing total disposals to date to £261.9 million, crystallising a return on cost of 23.1%; including gross proceeds of £100.3 million non-core disposal of five fire control centres, representing the collateral of the Avon loan portfolio, reflecting an exit yield of 6.5%
  • Including post year-end transactions, annualised NOI is £152.0 million and the portfolio value is £2,654.5 million

Charlotte Valeur, Chair of Kennedy Wilson Europe Real Estate Plc, commented:  “The 2015 financial results illustrate material progress across all parts of the business. I am pleased to report that both operational and financial results are ahead of business plans and as a result we have grown the quarterly interim dividend a further 20% over the previous quarter. The prospective dividend of 12.0 pence per share, or 48.0 pence per share on an annualised basis, reflects the Board’s confidence in the team’s ability to deliver income growth across the existing portfolio as well as secure cash flows from our accretive investments.”

Mary Ricks, President and CEO of Kennedy Wilson Europe, added: “The team has delivered strong 14.6% NAV growth underpinned by a solid like-for-like valuation uplift of 11.5%. With an average portfolio hold period of only 13 months, excellent asset management progress has driven £7.6 million of incremental annualised NOI over the year. We remain confident in our ability to drive further income growth to support the 37% prospective increase in the annualised dividend of 48.0 pence for 2016, announced this morning.

“Our £300 million non-core disposal programme announced in August 2015 is delivering a return on cost of 23.1% on £261.9 million of sales to date.  Capital recycling remains a high priority and we are targeting a further £200 million of disposals by June 2017 as we crystallise on asset management completions and continue to prune the portfolio. 

“Our business remains in robust operational health with ample liquidity. This will allow us to selectively capitalise on investment opportunities across our target regions that may arise from potential market dislocations, given the current volatile state of capital markets.”

Dividends

The directors of the Company have resolved to pay an interim quarterly dividend of 12.0 pence per share.

Dividend event

Declared

Ex-dividend

Record

Payment

Date

26-Feb-16

10-Mar-16

11-Mar-16

31-Mar-16

Next results announcement

The next trading update will be the Q1 trading update, due to be issued on or around 5 May 2016.

 

Leavesden Park, Watford, UK (1)

Investor enquiries
Juliana Weiss Dalton, CFA
Investor Relations Director,
Kennedy Wilson Europe
+44 (0) 20 7123 5577
ir@kennedywilson.eu

Press & media enquiries 
Dido Laurimore / Tom Gough
FTI Consulting
+44 (0) 20 3727 1000
kennedywilson@fticonsulting.com