TIDMHGPC
RNS Number : 1346Y
Henderson Global Property Companies
16 December 2010
HENDERSON GLOBAL PROPERTIES COMPANY LIMITED
16 December 2010
HENDERSON GLOBAL PROPERTIES COMPANIES LIMITED
Results of AGM and Interim Management Statement
Henderson Global Property Companies Limited ("HGPC" or the
"Company") today announces the results of the Annual General
Meeting held on 16 December 2010, and its Interim Management
Statement for the period from 1 September 2010 to 30 November
2010.
Result of AGM
The Company announces that at the Annual General Meeting held
today all resolutions bar one were duly passed. Resolution number
ten to continue the company in its present from was not passed.
Accordingly the Board will consider the options available to the
Company, and will announce the results as soon as practicable, but
no later than 31 March 2011.
The full text of the resolutions can be found in the Notice of
Meeting, copies of which are available from the Company's
website.
Review of the period from 1 September 2010 to 30 November
2010
MATERIAL EVENTS OR TRANSACTIONS DURING THE PERIOD
Portfolio
Global equity markets began the quarter on a positive note as
confidence increased that the US Federal Reserve would continue
quantitative easing. At the same time, GDP numbers for the UK and
US surprised on the upside. However, investor sentiment soured in
November as concerns about European sovereign debt re-emerged.
Ireland became the second country in the Eurozone to succumb to a
bail-out, and there were growing fears of contagion in other
debt-laden countries.
In Asia, housing sales remained robust for most of the year, and
domestic consumption in China supported growth forecasts. The Hong
Kong, Chinese and Singapore governments are however determined to
curb speculative buying of residential property and continue to
introduce restrictive measures. These measures are clearly working
in Hong Kong and Singapore, but demand in China will be hard to
dampen. There were a handful of IPOs on the Singapore Stock
Exchange, and there are several more in the pipeline that may have
to wait for stronger investor sentiment.
In the US, REIT management teams were upbeat during their 3rd
quarter earnings calls, demonstrating an ability to grow net
earnings and dividends despite the weak economic backdrop. Access
to both debt and equity at attractive prices give REITs a
competitive advantage in a market awash with distressed borrowers
and banks increasingly disposed to sell assets.
In the UK, three high-profile REITs announced the re-ignition of
their London City office development programme, while in Europe
there was little activity, with the exception of some significant
investment transactions in Sweden.
Overall, the FTSE/EPRA NAREIT Developed Index (GBP) rose 7.1%,
whilst the Company achieved 8.3%.
The Company's investment objective is to deliver the best
possible total return, while maintaining an income distribution of
at least 3.20p for the year. To this end, the Board is pleased to
see that the Company's total return is ahead of the FTSE/EPRA
NAREIT Developed Total Return index (in sterling) over the
financial year to date and that the Company has met its first
quarter's dividend target comfortably.
During the quarter the Manager adjusted regional asset
allocation, reducing the magnitude of the portfolio's overweight
position in North America in favour of Asia. The Manager reduced
overall exposure to Europe and built on positions in non-Euro
markets of the UK and Sweden.
In Asia, the Manager reduced our allocation to Hong Kong as
residential markets will, in their view, be subdued for the medium
term. On the other hand, the Manager believes that there is further
upside in the Chinese developers and have increased our position in
Shimao Property Holdings and made an initial investment in Hang
Lung Properties. In Japan we maintained our exposure to a balance
between the high-yielding REITs and developers. Singapore and
Australia saw the most significant shift in terms of allocation. We
moved to overweight in Singapore, adding positions to gain exposure
across all sectors. We added industrial name Mapletree Industrial
Trust to our existing holding in AIMS AMP Capital Industrial REIT.
For office and retail exposure we included Overseas Union
Enterprise and added Wing Tai Holdings for its residential focus.
In Australia, we maintained our existing positions in retail names,
which all trade at dividend yields in excess of 6.5%. We also
introduced Commonwealth Property Trust to gain some office and
industrial exposure.
Performance from North American property equities was solid in
the first quarter, but there continues to be significant deviation
between sectors. The apartment sector has benefited from a
continued weakness in the housing market, due in part to an acute
shortage of mortgage finance. Our holdings in residential REITs
Camden Property Trust and Sun Communities have performed very well.
Out of town, dominant regional malls also performed well as
national retail sales held up better than expected. Holdings in
Simon Property Group and Macerich added value, as did that in CBL
& Associates, where we increased our stake by 40% in September.
Office stocks as a group were weak, but we took advantage of the
pull-back in the data centre names and introduced Digital Realty
and DuPont Fabros, from which we expect double-digit earnings
growth next year.
We reduced our exposure to Europe, given the weakness in the
peripheral Eurozone countries. We took profits in our
top-performing Swedish stock Wihlborgs, while retaining our holding
in residential developer JM. We also reduced Dutch shopping centre
owner Eurocommercial after its November dividend. The London market
is further down the road to recovery than Continental Europe, and
while further yield compression is unlikely for the time being,
rental growth is starting to gain momentum. A shortage of A-Grade
office stock, combined with numerous lease expiries, is putting
upward pressure on rents in the City of London. To take advantage
of this growth, we added to holdings in Derwent London and Land
Securities.
Dividends
A fourth interim dividend of 0.80p per ordinary Share, in
respect of the year ended 31 August 2010, was paid on 29 October
2010 to holders registered on 15 October 2010, making 3.20p for the
year, in line with the Company's dividend objective.
Outlook
In terms of the physical property market the Manager believes we
are in the early stages of a recovery in occupational demand, the
key driver of value. Investor demand has already recovered for good
quality assets, but there is likely to be a clear gap between the
performance of prime and secondary assets. Listed property
companies are well placed to take advantage of whatever
opportunities are thrown up by banks, receivers and others. But the
supply of these opportunities will be moderate. Markets are not, in
general, facing the over-supply that characterised the 1990's, and
in some instances visible supply is at record low levels. Thus,
when the economy turns up, rental growth should follow quickly. In
the meantime, our Manager's assumption that interest rates and bond
yields remain below trend for some time should provide support to
valuations.
PERFORMANCE AND FINANCIAL HIGHLIGHTS
Performance to 30 November 2010
3 months 1 year
Net Asset Value Total 8.26% 26.14%
Return per ordinary share 7.07% 23.67%
FTSE EPRA/NAREIT Developed
Index (GBP)
Source: Fundamental Data
Financial Position at 30 November 2010 at 31 August 2010
Net assets 25.1m 23.5m
Net asset value (including current
year income) 66.9p 62.5p
Ordinary share price 58.0p 53.5p
Discount 13.3% 14.4%
Gearing
As mentioned in the year-end report, the company had begun to
introduce 'Contract For Difference' (CFD) positions into the
portfolio as a flexible, low-cost method of leverage. We are
permitted to leverage the portfolio up to 20%, but we do not
currently anticipate reaching this level in the near future. At 30
November 2010 leverage as a result of CFD exposure stood at 8.4%.
(31 August 2010: 5.8%)
THE PORTFOLIO
Top 10 Investments Country of % of portfolio % of portfolio
at 30 November at 31 August
Incorporation 2010 2010
CFS Retail Property Australia 4.5 2.0
United Urban Investment Japan 3.6 -
Shimao Property Hong Kong 3.6 1.4
Mitsubishi Estate Japan 3.5 4.3
Simon Property Group United States 3.3 3.3
Westfield Group Australia 3.0 4.8
Keppel Land Singapore 2.8 2.4
Land Securities UK 2.7 2.0
Wing Tai Singapore 2.7 -
Macerich United States 2.5 2.4
% at 30 November
Geographic Breakdown* 2010 % at 31 August 2010
United States 38.7 40.8
Japan 12.6 12.1
UK 8.5 8.8
Australia 8.5 4.0
Hong Kong & China 8.1 13.4
Singapore 6.3 2.3
Canada 5.2 4.7
France 3.3 3.0
Other 8.8 10.9
* based on location of the assets
% at 30 November
Sector Breakdown 2010 % at 31 August 2010
Retail 34.6 34.2
Office 25.0 23.1
Residential 16.0 15.8
Industrial 7.0 8.5
Healthcare 5.7 4.1
Storage 0.4 0.4
Hotel 0.3 2.4
Other 11.0 11.5
The investment objective is to provide investors with a total
return (both income and capital) principally through investing in
listed property securities and property-related securities
globally.
- ENDS -
For further information, please contact:
Sara Bourne James de Sausmarez
Company Secretary Head of Investment Trusts
Telephone: 01481 750858 Henderson Global Investors
Telephone: 020 7818 3349
Sarah Gibbons-Cook
Investor Relations and PR Manager
Henderson Global Investors
Telephone: 020 7818 3198
Further information on the Company, including an up to date NAV
and share price information, can be found at
www.hendersonglobalproperty.com . Neither the contents of the
Company's website nor the contents of any website accessible from
hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, his announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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