During the last six months the CLS Holdings Plc has been active in the sale, acquisition and management of its properties throughout its operating divisions. In line with their strategy to build a portfolio in Germany in excess of £200 million, they purchased four further German properties at a cost of £41.0 million and have since 30 June completed or exchanged contracts on a further 6 properties at a cost of £68.4 million, all at yields of around 7 per cent. CLS currently hold or have exchanged on £120.7 million of German commercial property and are confident of reaching our investment target.
In June 2006 CLS contracted to sell Solna Business Park at a value of £267.0 million (SEK 3.575 billion) via a corporate sale, generating an increase in their net assets of £7.5 million or 9.6 pence per share. The transaction completed on 21 August 2006, boosting the Group's cash resources by £113.5 million.
The UK and French portfolios have both performed well through a combination of asset management, development and further yield compression. Overall, excluding Solna Business Park, just 5.2 per cent of the portfolio by area is either vacant or under development.
As a result, CLS has seen the strongest organic growth in net asset value per share in any six month period in the Group's history, with their adjusted net asset per share having increased by 68.9 pence or 11.4 per cent since 31 December 2005, to 675.8 pence per share.
Financial highlights
- Adjusted NAV per share* of 675.8 pence, up 11.4 per cent (Statutory NAV per share of 480.6 pence, up 8.8 per cent)
- Profit before tax (including property valuation uplift) £56.8 million, up 37.2 per cent.
- Intended special distribution for the interim period to 30 June 2006 of £39.9 million by way of tender offer buy-back on the basis of 2 for 25 at 640 pence per share, representing a distribution of 51.2 pence per share. This special distribution is the result of the significant increase in cash reserves and profit generated from the sale of Solna Business Park which completed on 21 August 2006.
- Property portfolio (including share of JVs) valued at £1.16 billion, up 5.5 per cent from 31 December 2005 (including property assets at Solna Business Park held for sale of £238.9 million).
- Net rental income £33.1 million, down 2.6 per cent.
- Annualised added value to shareholders 27.7 per cent, up 11.7 per cent, based on increase in adjusted NAV per share and distributions in the year (24.4 per cent added value based on statutory NAV up 8.6 per cent).
- Cash £94.2 million (including cash assets at Solna Business Park of £6.7 million held for sale).
Source: CLS Holdings
