New Frontier considers delisting

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New Frontier considers delisting

Published Date: 2019-04-16 | Source: Stephen Gunnion | Author: Stephen Gunnion | Comments

New Frontier considers delisting

The UK and continental Europe property investor is looking for ways to protect the value of its assets due to Brexit.

New Frontier Properties says it's investigating a possible delisting from the Johannesburg and Mauritian stock exchanges as it tries to reduce its cost base and position its assets to take advantage of any improvement in the UK retail sector, which remains weak due to Brexit.

Releasing interim results, the property group said it was looking for ways to cut its debt and was working with all stakeholders to protect the value of its assets and the business. It invests in shopping centres and warehouses in the UK and Europe and said it had already taken steps to dispose of property in Dublin to reduce its gearing.

Pressure on the UK retail sector resulted in a devaluation of its shopping centres last year, pushing its loan to value (LTV) above its covenants. It said its banks had trapped its free rental cash flow, although they agreed to release funds to cover operating expenses and capital expenditure to support letting activity at its shopping centres.

The group reported a marginal fall in combined occupancies at its Blackpool, Middlesbrough and Burton upon Trent centres at the end of February following the closure of a number of seasonal temporary stores. It completed nine lease renewals, of which six were core tenants and one new letting during the six-month period. Two tenants entered administration, including restaurant chain Patisserie Valerie and retailer Fivepoundworld.

Rental income for the period fell 13% to £7.62 million and it recorded a fair value loss on investment property of £12.5 million, resulting in a loss of £11 million from a £2.79 million profit last year. It's not paying an interim dividend.

Its shares didn't trade yesterday, closing unchanged at R7.





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