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Interim Results for the six months ended 31 August 2017

18.10.17

U+I on track to deliver full year development and trading gains in line with existing guidance

U+I (LSE:UAI), the specialist regeneration developer and investor, announces its interim results for the six months ended 31 August 2017.

On track to deliver £65m-£70m of development and trading gains in FY18

  • £9.4m delivered in the year to date:
    • £7.2m delivered in H1
    • £2.2m delivered since the period end
  • Good visibility on projects delivering gains in H2 underpins confidence in meeting full year target
    • £9m-11m of gains set to be realised at 12 Hammersmith Grove – currently 79% let and 17% under offer
    • £6m-8m of gains due from the forward-sale of a wind farm project
    • Two out of three planning consents required to deliver FY target now achieved

Good progress made to reposition investment portfolio

  • Valuation of our investment portfolio (including our share of JVs) flat during the first half of the year
  • Void rate of 6.0% and contracted rental income of £12.6m (FY 2017: 4.7% and £12.7m)
  • £50m of non-core assets identified for sale in the year
    • £22.5m assets sold in the year above book value
    • £12.5m of assets brought to the market for sale

Continued focus on operational discipline and capital

  • On track with FY 2018 target of £2m reduction in net recurring overheads
    • £1.3m of efficiency benefits delivered in H1 via fees and overhead reduction
  • £67m Aviva facility renegotiated to provide increased flexibility on substitution and cost reduction of approximately 75 bps p.a.

Interim dividend of 2.4 pence per share declared (H1 2017: 2.4 pence per share)

Matthew Weiner, Chief Executive said:

“We are delivering on our targets, realising gains of £9.4 million since 28 February 2017 to date, and we are confident that we can meet our full year target of £65-£70 million of development and trading gains for the year. This is supportive of our three-year target to deliver a minimum of £155 million of development and trading gains and a 12% post-tax total annual return.

We are also encouraged with the progress made to reposition our investment portfolio and to reduce overheads.

The demand for mixed-use regeneration within communities in London, Manchester and Dublin continues to grow as the pressure on existing housing stock and infrastructure increases. We remain focussed on delivering value through our PPP, trading and investment activities, allowing us to deliver long-term sustainable returns for our investors and social and economic change for the communities in which we work.”

Financial summary (unaudited for the six months ended 31 August 2017 and 31 August 2016)

  31 Aug 2017 31 Aug 2016 28 Feb 2017
Development and trading gains £7.2 million £11.5 million £35.0 million
Basic NAV £336.8 million £340.5 million £347.6 million
Basic NAV per share 269p 272p 278p
Loss before tax (£3.3) million (£11.7) million (£1.7) million*
Basic loss per share (3.2)p (9.9)p (2.4)p
Dividend per share (in respect of period reported) 2.4p 2.4p 5.9p
Supplemental dividend per share declared - - 2.8p
Net debt £159.4 million £128.0 million £120.8 million
Gearing 47.3% 37.6% 34.8%

* After an exceptional charge of £2.1m relating to serviced office business

Conference call for analysts and investors

The company will host an audiocast for sell-side analysts and investors at 9am hosted by:

Matthew Weiner, CEO; Richard Upton, Deputy CEO; and Marcus Shepherd, CFO.

The audiocast details are below and the interims presentation will be posted on the corporate website:
http://www.uandiplc.com/investors/financial-calendar

Audiocast link:
http://www.investis-live.com/uandi/59b7a5ba8b39dd100087be60/fsdfs

Participant dial-in numbers

Location you are dialling in fromNumber you should dial

United Kingdom020 3059 8125

All other locations+44 20 3059 8125

Participant Password

U + I - this must be quoted to the operator in order for participants to gain access to the conference.

For further information, please contact:

U and I Group PLC
Lucy Grimble, Head of Communications and Investor Relations
+44 20 7828 4777
ir@uandiplc.com

Camarco (Financial PR advisor)
Geoffrey Pelham-Lane / Tom Huddart
+44 20 3757 4985/4996
uandi@camarco.co.uk

Interim Results for the six months ended 31 August 2017

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