abrdn Property Income Trust Limited - Annual Results - December 2024
LEI: 549300HHFBWZRKC7RW84
(
an authorised closed-ended investment company incorporated in
(“API” or the “Company”)
FINAL RESULTS FOR THE YEAR ENDED
The Company's Annual Report and Accounts for the year ended
PERFORMANCE SUMMARY
31 December 31 December
Earnings, Dividends & Costs
2024 2023
IFRS Loss per share (p) (11.25) (2.17)
Dividends paid per ordinary share 3.0 4.0
(p)
Dividends declared per ordinary share but 3.0 0.0
not yet paid (p) *
Dividend Cover (%) ** 45 71
Dividend Cover excluding non-recurring items (%) 66 82
Ongoing Charges **
As a % of average net assets including direct property 2.8 2.5
costs
As a % of average net assets excluding direct property 1.2 1.2
costs
31 December 31 December Change
Capital Values & Gearing
2024 2023 %
Net assets (£million) 30.4 298.1 (89.8)
Net asset value per share (p) (note 8.0 78.2 (89.8)
22)
Capital Distribution (p) 52.0 0.0 N/A
Third Quarter PID 1.0 - N/A
PID paid post year-end 3.0 - N/A
Net asset value incl. noted 64.0 78.2 (18.2)
Distributions (p)
Ordinary Share Price (p) 6.9 53.0 (87.0)
(Discount)/Premium to NAV (%) (13.8) (32.2)
1 year 3 year 5 year 10 year
Total Return
% return % return % return % return
NAV ^ (19.2) (31.7) (16.2) 31.9
Share Price ^ 25.6 (6.7) (6.1) 42.9
FTSE All-Share Real Estate (11.8) (32.6) (26.9) (3.4)
Investment Trusts Index
FTSE All-Share Index 9.5 18.5 26.5 81.9
* Represents the special interim property income distribution to shareholders (Ex-Dividend Date:
** As defined and calculated under API’s Alternative Performance Measures (as detailed in the full Annual Accounts which can be found via the following link: https://www.abrdnpit.co.uk/en-gb/literature)
^ Assumes re-investment of dividends excluding transaction costs.
Sources: abrdn, MSCI
CHAIR’S STATEMENT
Background
As previously reported in both the Company’s 2023 Annual Report & Financial Statements and 2024 Interim Report & Accounts, the Board undertook a strategic review in the second half of 2023.
This was prompted by concerns about the Company’s size, lack of liquidity in its shares, uncovered dividend and the share price trading at a persistently large discount to the net asset value (NAV). The outcome of this review was for the Board to recommend to shareholders that they vote in favour of a proposed merger with Custodian REIT.
However, this ultimately did not garner enough shareholder support at the Extraordinary General Meeting in
In advance of the March EGM, the Board had indicated that, should the Custodian merger proposal fail, then a liquidation of the Company would be the recommended alternative.
Therefore, in
Managed Wind-Down
Following the
Sale of aPH
After extensive due diligence by the purchaser and detailed negotiations, the transaction completed on
GoldenTree paid an initial cash deposit of £35.1m upon exchange of contracts in
The Board’s view was that the most efficient way of returning funds to shareholders was by means of a Redeemable Bonus Share Scheme. To that end, a circular was issued to shareholders outlining proposed changes to the Articles of Association which allowed the Board to return 55p per share in aggregate. This was made up of:
▸
an initial return of capital comprising 52p per share, paid on
▸
an interim Property Income Distribution of 3p per share, paid on
At a General Meeting of the Company on
REIT Status
The Company had been a member of the REIT regime since
Board Composition
Following the disposal of the subsidiaries and initial return of Capital to shareholders, the Board undertook a review of the residual business and requirements for the foreseeable future. Taking account of the responsibilities which were required to be discharged and the need to exercise management of the Company’s ongoing operating costs, the Board concluded that two Directors was an appropriate number. On 31st December, three Directors (including the previous Chair) resigned from the Board.
The Company would like to acknowledge and thank them for their huge contributions to the Company - particularly over the last 18 months.
Financial Resources
As noted, the transaction with GoldenTree included the transfer of the Group’s debt facility with RBSI and the Company no longer has access to revolving credit facilities (“RCF”).
In order to ensure that the retained cash was invested appropriately, the Board invested the residual cash proceeds into a shorter-term money market fund, the abrdn
At the year end the Company held £36.7m in cash and had other financial resources of £18.4m net of any prevailing financial commitments; i.e. not including any future costs associated with the running of the company through liquidation or potential balancing payment due on the transaction.
Annual General Meeting (“AGM”)
The Annual General Meeting (“AGM”) will be held at
Final Distributions and Outlook
As detailed further in these 2024 Annual Report & Financial Statements, the current NAV of 8p might imply that the Company could liquidate and distribute that to shareholders. It should be noted however that the current NAV does not reflect ongoing running costs until liquidation and beyond, or final matters relating to the Sales Agreement. Furthermore, there is still considerable uncertainty around the timing and value of the eventual sale of Far Ralia which could impact the size of future distributions. The Investment Manager is actively looking to dispose of Far Ralia and their sole focus, together with the Board, is to maximise the return of capital to shareholders as expeditiously as possible.
Shareholders are reminded that as soon as liquidators are appointed the Company’s shares will cease trading on the
When appropriate the Board will update shareholders regarding the sale of Far Ralia, and any potential impact to the ultimate distribution they will receive.
INVESTMENT MANAGER’S REPORT
Review of 2024
Throughout 2024 the main focus was on managing the property assets optimally despite the corporate activity affecting the future of the Company. We began the year with the merger discussions and resulting due diligence, before the shareholder votes that led to the beginning of the Managed Wind-Down (MWD). During this time, the Company continued to reduce debt with six disposals being completed – two in each of the first three quarters of the year. These are outlined in more detail below.
Following the shareholder decision in
After an 8-week formal due diligence period, contracts were exchanged on the corporate sale of aPH in September with completion on the 29th of November.
Purchases:
Given the corporate activity in early 2024 and the subsequent vote to change the Group’s Investment Objective the Company made no purchases during the year.
Sales:
Prior to the disposal of aPH to GoldenTree, six assets had been sold in the year with a total sales price of £43.5m.
▸
▸
▸
Hebburn, Unit
▸
▸
Dover,
▸
Overall, the 2024 sales were completed 0.1% above the valuation immediately preceding the relevant sale; the sales resulted in an accounting loss of £2.1m when taking into account the
Outlook for 2025
The sole focus of the Board and Investment Manager in the coming year is to sell the remaining asset and liquidate the company as swiftly as possible. To that end, we continue to market the one remaining property asset that the company owns, Far Ralia. As a natural capital investment (in an emerging market), where a proportion of the value is attributed to the value of potential carbon offsets offered by the tree planting, there isn’t a large number of potential investors. That said, we have had interest to date from a variety of potential buyers and anticipate completing a sale during the course of the year.
Valuation
The portfolio was valued quarterly by
PRINCIPAL RISKS AND UNCERTAINTIES
The Board ensures that proper consideration of risk is undertaken in all aspects of the Company’s business on a regular basis. Subsequent to completing the disposal of abrdn
Delays in the eventual liquidation of the Company.
The eventual liquidation of the Company is likely to be dependent on the timing of the sale of the Company’s sole remaining asset, Far Ralia; the Board will provide an update to Shareholders if this position changes. The risk therefore is that any delays in the sales process will likely impact not just the timing of the liquidation but also potentially the scale of final distribution to shareholders (see below). The risk is mitigated by an active marketing process and risks include finalising Scottish Forestry consent required as part of the sales process which is progressing. Furthermore, the Board are in regular contact with the potential liquidators regarding the timing of when they could be appointed and the retention they would require.
The ultimate total distribution to shareholders is less than expected.
To mitigate this risk, the Board received regular updates from the Investment Manager during the negotiation period for the subsidiary sale and established a prudent buffer at the point of initial capital distribution to Shareholders during
Environmental.
Extreme weather events both in the
Please see the Sustainability Committee Report for further details on how the Company addresses environmental risk, including climate change.
Other Risks.
Other risks faced by the Company include the following:
-- Tax efficiency – following the change in structure of the Group on 29
November 24 , it can no longer qualify for REIT Tax status. As such,
there is a clear risk that the Company can no longer be seen as a tax
efficient investment vehicle for shareholders. In addition a future
delisting may ultimately impact shareholders invested via tax efficient
wrappers such as ISAs.
-- Regulatory – breach of regulatory rules could lead to the suspension of
the Group’s Stock Exchange Listing, financial penalties or a qualified
audit report.
-- Financial – inadequate controls by the Investment Manager or third-party
service providers could lead to misappropriation of assets.
Inappropriate accounting policies or failure to comply with accounting
standards could lead to misreporting or breaches of regulations.
-- Operational – failure of the Investment Manager’s accounting systems or
disruption to the Investment Manager’s business, or that of third-party
service providers, could lead to an inability to provide accurate
reporting and monitoring, leading to loss of shareholder confidence.
-- Business continuity – risks to any of the Company’s service providers or
properties, following a catastrophic event e.g. terrorist attack,
cyber-attack, power disruptions or civil unrest, leading to disruption
of service, loss of data etc.
-- Cyber– the risk of large-scale network disruption through various forms
such as hacking, malware, phishing, DDOS, data breach or loss. In
addition, Artificial Intelligence and it's potential use in cyber
attacks.
The Board seeks to mitigate and manage all risks through review, policy setting and enforcement of contractual obligations. It also regularly monitors the investment environment and where the Company’s cash is invested.
Details of the Group’s internal controls are described in more detail in the Corporate Governance Report in the full Annual Accounts which can be found via the following link: https://www.abrdnpit.co.uk/en-gb/literature.
Emerging Risks
Emerging risks have been identified by the Board through a process of evaluating relatively new risks that have emerged and increased materially in the year, and subsequently, or through market intelligence are expected to grow significantly and impact the Company. Any such emerging risks are likely to cause disruption to the business model. If ignored, they could impact the Company’s financial performance and prospects. Alternatively, if recognised, they could provide opportunities for transformation and improved performance.
▸ Future of the Company
In the Company’s 2023 Annual Report & Financial Statements, several risks were noted associated with the size, speed and method of capital distributions back to shareholders, and maintenance of REIT status if shareholders voted in favour of the (then) proposed managed wind-down. Following the vote, the Board took steps to address these ultimately resulting in the disposal of the Group’s subsidiaries to
There now exists a clear risk around the liquidation process itself. Once in liquidation, the Company’s shares will no longer be traded on a stock exchange and shareholders will not be able to realise their investments and will be dependent on the liquidator who will assume responsibilities over the operational management of the Company during the liquidation period. The length of the liquidation itself and timing of ultimate distributions relating to any residual cash due to shareholders would be at their discretion.
▸ Economic and Geopolitical
The current economic and geopolitical environment is unpredictable, and changing rapidly, and this may affect real estate valuations and/or deter prospective buyers, increasing the risk relating to the quantum and timing of sale of Far Ralia.
▸ Climate
A "greenlash" against climate policies is emerging following the
▸ Technology & Artificial Intelligence
Cyber-attacks are increasing in occurrence and target businesses’ data, IT systems and even their physical infrastructure as buildings have become more reliant on smart technology for their daily operation. In addition, the rapid evolution of AI is potentially introducing risks that have not yet been identified or quantified.
Viability Statement
The Company’s sole remaining property asset is the land at Far Ralia. Subsequent to the post year end PID of 3p, other assets comprise an investment in a money market fund, cash at bank and other net current assets. The Board has therefore considered whether the Company could still be considered ‘viable’. As part of this assessment, the Board reviewed estimations of projected costs (up to and during a liquidation period) relative to cash retained from the initial distribution of 55p.
The Board has also carried out a robust assessment of the principal and emerging risks faced by the Group, as detailed above.
After review, the Board are confident that the Company has sufficient resources to be able to meet its liabilities as they fall due. However, it also acknowledges that the Company can no longer be considered viable given there is a clear intention to liquidate the Company and return surplus cash to shareholders.
STATEMENT OF DIRECTOR’S RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the Group Consolidated Financial Statements for each year which give a true and fair view, in accordance with the applicable
In preparing those Consolidated Financial Statements, the Directors are required to:
-- Select suitable accounting policies in accordance with IAS 8: Accounting
Policies, Changes in Accounting Estimates and Errors and then apply them
consistently;
-- Make judgement and estimates that are reasonable and prudent;
-- Present information, including accounting policies, in a manner that
provides relevant, reliable, comparable and understandable information;
-- Provide additional disclosures when compliance with the specific
requirements in IFRSs as adopted by the European Union is insufficient
to enable users to understand the impact of particular transactions,
other events and conditions on the Group’s financial position and
financial performance;
-- State that the Group has complied with IFRSs as adopted by the European
Union , subject to any material departures disclosed and explained in the
Group Consolidated Financial Statements; and
-- Prepare the Group Consolidated Financial Statements on a going concern
basis unless it is inappropriate to presume that the Group will continue
in business.
The Directors confirm that they have complied with the above requirements in preparing the Group Consolidated Financial Statements. As detailed further in note 2.1, the Directors have deemed it appropriate to prepare the Group Consolidated Financial Statements on a basis other than that of a going concern.
The Directors are responsible for keeping adequate accounting records, that are sufficient to show and explain the Group’s transactions and disclose with reasonable accuracy at any time, the financial position of the Group and to enable them to ensure that the Financial Statements comply with The Companies (
The maintenance and integrity of the Company’s website is the responsibility of the Directors through its Investment Manager; the work carried out by the auditors does not involve considerations of these matters and, accordingly, the auditors accept no responsibility for any change that may have occurred to the Consolidated Financial Statements since they were initially presented on the website. Legislation in
Responsibility Statement of the Directors in respect of the Consolidated Annual Report under the Disclosure and Transparency Rules
The Directors each confirm to the best of their knowledge that:
-- The Consolidated Financial Statements, prepared in accordance with IFRSs
as adopted by the European Union , give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Group;
and
-- The management report, which is incorporated into the Strategic Report,
Directors’ Report and Investment Manager’s Review, includes a fair
review of the development and performance of the business and the
position of the Group, together with a description of the principal
risks and uncertainties that they face.
Statement under the
The Directors each confirm to the best of their knowledge and belief that the Annual Report and Consolidated Financial Statements taken as a whole are fair, balanced and understandable and provide the information necessary to assess the Group’s position and performance, business model and strategy.
Approved by the Board on
Chair
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the year ended31 December 2024 12 Months to 12 Months to 31 Dec 2024 31 Dec 2023 Notes £ £ Rental income 24,070,912 27,552,279 Service charge income 4,899,881 4,884,357 Service charge expenditure (5,937,817) (6,354,598) Net Rental Income 23,032,976 26,082,038 Administrative and other expenses Investment management fee 4 (1,399,114) (2,632,225) Other direct property operating expenses 4 (2,447,020) (2,408,461) Net Impairment gain on trade receivables 4 (110,725) 213,048 Fees associated with strategic review and 4 (2,800,223) (1,729,925) aborted merger Fees associated with managed wind-down and 4 (399,197) - portfolio disposal Other administration expenses 4 (1,505,185) (1,136,742) Total administrative and other expenses (8,661,464) (7,694,305) Operating profit before changes in fair value 14,371,512 18,387,733 of investment properties Valuation loss from investment properties 7 - (17,989,531) Valuation gain/(loss) from land 8 475,876 (783,683) Estimated costs arising from future disposal (165,000) - Loss on disposal of subsidiaries 10 (48,152,578) - Loss on disposal of investment properties 7 (2,063,652) (279,090) Operating loss (35,533,842) (664,571) Finance income 5 649,889 92,178 Finance costs 5 (7,955,137) (7,695,508) Loss for the year before taxation (42,839,090) (8,267,901) Taxation Tax charge 6 (55,110) - Loss for the year, net of tax (42,894,200) (8,267,901) Other comprehensive (loss) / income Movement in fair value on swap 15a - (902,534) Movement in fair value on interest rate cap 15b 98,784 (789,918) Total other comprehensive (loss)/gain 98,784 (1,692,452) Total comprehensive loss for the year, net of (42,795,416) (9,960,353) tax Loss per share 2024 (p) 2023 (p) Basic and diluted loss per share 20 (11.25) (2.17)
All items in the above Consolidated Statement of Comprehensive Income derive from discontinuing operations.
The notes below are an integral part of these Consolidated Financial Statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at31 December 2024
31 Dec 24 31 Dec 23
Assets Notes £ £
Non-current assets
Investment properties 7 - 388,338,754
Lease incentives 7 - 9,306,403
Land 8 - 8,250,000
Interest rate cap 15b - 559,671
Rental deposits held on behalf of tenants - 895,003
- 407,349,831
Current Assets
Investment property held for sale 9 - 35,100,000
Land 8 9,835,000 -
Trade and other receivables 11 2,171,092 6,101,152
Cash and cash equivalents 12 36,655,166 6,653,838
Interest rate cap 15b - 849,110
48,661,258 48,704,100
Total assets 48,661,258 456,053,931
Liabilities
Current liabilities
Trade and other payables 13 6,860,858 14,018,455
Distributions payable 21 11,436,569 -
18,297,427 14,018,455
Non-current liabilities
Bank borrowings 14 - 141,251,910
Obligations under finance leases 16 - 1,810,120
Rental deposits due to tenants - 895,003
- 143,957,033
Total liabilities 18,297,427 157,975,488
Net assets 30,363,831 298,078,443
Equity
Capital and reserves attributable to Company’s
equity holders
Share capital 18 228,383,857 228,383,857
Treasury share reserve 18 (18,400,876) (18,400,876)
Redeemable Bonus Share issue 18 (198,233,868) -
Retained Earnings 19 - -
Capital reserves 19 (49,022,257) (9,660,578)
Other distributable reserves 19 67,636,975 97,756,040
Total equity 30,363,831 298,078,443
2024 (p) 2023 (p)
NAV per share 22 8.0 78.2
Approved and authorised for issue by the Board of Directors on
The accompanying notes below are an integral part of these Consolidated Financial Statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2024
Share Treasury Redeemable Retained Capital Other Total Equity
Notes Capital £ Shares £ Bonus Shares Earnings £ Reserves £ Distributable £
£ Reserves £
Opening
balance 1 228,383,857 (18,400,876) - - (9,660,578) 97,756,040 298,078,443
January 2024
Loss for the - - - (42,894,200) - - (42,894,200)
year
Other
comprehensive - - - - 98,784 - 98,784
gain
Total
comprehensive - - - (42,894,200) 98,784 - (42,795,416)
loss for the
year
Redeemable - - (198,233,868) - - - (198,233,868)
Bonus Shares
Dividends 21 - - - (15,248,759) - - (15,248,759)
paid
Dividends 21 - - - (11,436,569) - - (11,436,569)
payable
Valuation
loss from 8 - - - (475,876) 475,876 - -
land
Reclassified
from Other - - - 30,119,065 - (30,119,065) -
distributable
reserves
Transfer
between (10,279,891) 10,279,891 - -
reserves
Loss on
disposal of - - - 48,152,578 (48,152,578) - -
subsidiaries
Loss on
disposal of 7 - - - 2,063,652 (2,063,652) - -
investment
properties
Balance at 31 228,383,857 (18,400,876) (198,233,868) - (49,022,257) 67,636,975 30,363,831
December 2024
For the year ended 31 December 2023
Share Treasury Retained Capital Other Total Equity
Notes Capital £ Shares £ Earnings £ Reserves £ Distributable £
Reserves £
Opening
balance 1 228,383,857 (18,400,876) - 4,382,024 11,084,178 97,838,372 323,287,555
January 2023
Loss for the - - - (8,267,901) - - (8,267,901)
year
Other
comprehensive - - - - (1,692,452) - (1,692,452)
loss
Total
comprehensive - - - (8,267,901) (1,692,452) - (9,960,353)
loss for the
year
Dividends 21 - - - (15,248,759) - - (15,248,759)
paid
Valuation
loss from 7 - - - 17,989,531 (17,989,531) - -
investment
properties
Valuation
loss from 8 - - - 783,683 (783,683) - -
land
Reclassified
from Other - - - 82,332 - (82,332) -
distributable
reserves
Loss on
disposal of 7 - - - 279,090 (279,090) - -
investment
properties
Balance at 31 228,383,857 (18,400,876) - - (9,660,578) 97,756,040 298,078,443
December 2023
CONSOLIDATED CASH FLOW STATEMENT For the year ended31 December 2024
12 months to 12 months to
31 Dec 2024 2023
Cash flows from operating activities Notes £ £
Loss for the year before taxation (42,839,090) (8,267,901)
Movement in lease incentives 96,128 (984,446)
Movement in trade and other receivables 3,055,794 1,212,710
Movement in trade and other payables (2,023,484) 2,353,098
Finance costs 5 7,955,137 7,695,508
Finance income 5 (649,889) (92,178)
Valuation loss from investment properties 7 - 17,989,531
Valuation loss from land 8 (475,876) 783,683
Estimated costs arising from future disposal 165,000 -
Loss on disposal of subsidiaries 10 48,152,578 -
Loss on disposal of investment properties 7 2,063,652 279,090
Net cash inflow from operating activities 15,499,950 20,969,095
Cash flows from investing activities
Finance income 5 649,889 92,178
Purchase of investment properties 7 - (23,986,401)
Purchase of land 8 (1,274,124) (1,533,683)
Capital expenditure on investment properties 7 - (21,678,721)
Net proceeds from disposal of investment 7 42,986,348 6,120,910
properties
Net proceeds from disposal of subsidiaries 10 234,298,743 -
Net cash (outflow)/inflow from investing 276,660,856 (40,985,717)
activities
Cash flows from financing activities
Bonus share distribution in period 18 (198,233,868) -
Borrowing on RCF 14 13,300,000 63,000,000
Repayment of RCF 14 (41,874,379) (6,125,621)
Repayment of expired facility 14 - (110,000,000)
New term facility 14 - 85,000,000
Interest paid on bank borrowing 5 (9,755,493) (7,396,815)
Receipts on Interest rate SWAP - 1,254,217
Receipts on Interest rate Cap 15b 1,123,358 365,674
Finance lease interest 5 (33,768) (49,289)
Dividends payable to the Company’s 21 (11,436,569) -
shareholders
Dividends paid to the Company’s shareholders 21 (15,248,759) (15,248,759)
Net cash inflow/(outflow) from financing (262,159,478) 10,799,407
activities
Net (decrease)/increase in cash and cash 30,001,328 (9,217,215)
equivalents in the year
Cash and cash equivalents at beginning of 12 6,653,838 15,871,053
year
Cash and cash equivalents at end of year 12 36,655,166 6,653,838
Notes TO the consolidated financial statements
1. General information
The address of the registered office is
PO Box 255,
Trafalgar Court,
Les Banques,
These audited Consolidated Financial Statements were approved for issue by the Board of Directors on
1. Accounting policies
2.1 Basis of preparation
The audited Consolidated Financial Statements of the Group have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as adopted by the
Assessment of Going Concern
During the second half of 2023 the Board undertook a strategic review. This review was prompted by the Board’s concerns, as well as those of some shareholders about the Group’s size, the lack of liquidity in its shares, the persistent discount to NAV and an uncovered dividend. The outcome of this review, following interest from other listed REITs, was that the Board recommended to shareholders that they vote in favour of a proposed merger with
Under the Managed Wind-Down process, the Group and its subsidiaries were managed with the intention of realising all the assets in its portfolio in an orderly manner, with a view to repaying borrowings and making timely returns of capital to shareholders whilst aiming to obtain the best achievable value for the assets.
As part of this process, the Group successfully disposed of 6 Investment Properties prior to reaching an agreement with
Following completion of the transaction, Shareholders were given the opportunity to vote on a proposal for the Company to make an initial return of the proceeds of sale by way of an initial issue and redemption of Redeemable Bonus Shares repurchased for
As at
As a result of adopting a basis other than that of a going concern, the Board has deemed it appropriate to reduce the fair value of the land by the expected costs of disposal. No other costs of liquidation have been recognised other than those committed or incurred at the balance sheet date.
Changes in accounting policy and disclosure.
The following amendments to existing standards and interpretations were effective for the year, but were deemed not applicable to the Group:
▸ Amendments to IFRS 16 – Lease Liability in a Sale and Leaseback; Amendments to IAS 7 and IFRS 7 – Supplier Finance Arrangements.
The following amendments to existing standards and interpretations were effective for the year and have been adopted by the Company:
▸ Amendments to IAS 1 Classification of Liabilities as Current or Non-current.
The amendment clarifies a criterion for recognising a liability as non-current if an entity has the right to defer settlement for at least 12 months after the reporting period. Given the current circumstances of the Company, all liabilities have been deemed current albeit the Board acknowledge that the classification is unaffected by the Company’s intention or expectation whether it will exercise a right to defer.
New and revised IFRS Standards in issue but not yet effective
At the date of authorisation of these financial statements, the Group has not applied the following new and revised IFRS Accounting Standards that have been issued but are not yet effective. The Group will consider these amendments in due course to see if they will have any impact on the Group.
▸
Amendments to IAS 21 Lack of Exchangeability - The Effects of Changes in Foreign Exchange Rates [Effective
▸
Amendments to IFRS 9 Financial Instruments (Classification and Measurement) [Effective
▸
Amendments to IFRS 18 Presentation and Disclosure in Financial Statements [Effective
▸
Amendments to IFRS 19 Subsidiaries without Public Accountability: Disclosures [Effective
2.2 Significant accounting judgements, estimates and assumptions
The preparation of the Group’s Financial Statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the reporting date. However, uncertainties about these assumptions and estimates, could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future periods. The most significant estimates and judgements are set out below. There were no critical accounting judgements.
Fair value (& presentation) of investment properties and land
Investment properties and land have historically been stated at fair value as at the Balance Sheet date. Gains or losses arising from changes in fair values were included in the Consolidated Statement of Comprehensive Income in the year in which they arose. The fair value of investment properties and land was determined by external real estate valuation experts using recognised valuation techniques. The fair values were determined having regard to any recent real estate transactions where available, with similar characteristics and locations to those of the Group’s assets. The directors consider that there is a significantly wider range of estimation uncertainty for land than for investment properties because there are few comparable assets or recent transactions, and the estimates involved (namely Carbon pricing). As detailed further in notes 2.4 and 9, the Directors have also assessed the classification of Land as a current asset considering the current marketing of the site and presentation of these financial statements on a basis other than that of a going concern.
2.3 Summary of material accounting policies
The Group adopted Disclosure of Accounting Policies (Amendments to IAS 1 and IFRS Practical Statement 2) from
Accounting policy information may be material because of the nature of the related transactions, other events or conditions, even if the amounts are immaterial. However, not all accounting policy information relating to material transactions, other events or conditions is itself material. The Directors have reviewed the accounting policies and are satisfied that the information previously disclosed as part of their ‘significant’ accounting policies fulfils the definitions of ‘material’ under the amended standards – as such there has been no change to the summary of accounting policies below in the current year.
A Basis of consolidation
The audited Consolidated Financial Statements have historically comprised the financial statements of
Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with subsidiaries and has the ability to affect those returns through its power over the subsidiary. Specifically, the Group controls a subsidiary if, and only if, it has:
-- Power over the subsidiary (i.e. existing rights that give it the current
ability to direct the relevant activities of the subsidiary)
-- Exposure, or rights, to variable returns from its involvement with the
subsidiary
-- The ability to use its power over the subsidiary to affect its returns
The Group assesses whether or not it controls a subsidiary if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary.
Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of other comprehensive income from the date the Group gains control until the date when the Group ceases to control the subsidiary.
During the year, the Company completed on the disposal of its wholly owned subsidiaries. As such, the Consolidated Statement of Financial Position represents the Company in isolation (2023: consolidated group), while the Consolidated Statement of Comprehensive Income includes the pro-rated income and expenditure up to the date of disposal as noted above.
B Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The Consolidated Financial Statements are presented in pound sterling, which is also the Company’s functional currency.
C Revenue recognition
Revenue is recognised as follows;
i) Bank interest
Bank interest income is recognised on an accruals basis.
ii) Rental income
Rental income from operating leases is net of sales taxes and value added tax (“VAT”) recognised on a straight-line basis over the lease term including lease agreements with stepped rent increases. The initial direct costs incurred in negotiating and arranging an operating lease are recognised as an expense over the lease term on the same basis as the lease income. The cost of any lease incentives provided are recognised over the lease term, on a straight-line basis as a reduction of rental income. The resulting asset is reflected as a receivable in the Consolidated Balance Sheet.
Contingent rents, being those payments that are not fixed at the inception of the lease, for example increases arising on rent reviews, are recorded as income in periods when they are earned. Rent reviews which remain outstanding at the year-end are recognised as income, based on estimates, when it is reasonable to assume that they will be received.
iii) Other income
The Group was classified as the principal in its contract with the managing agent. Service charges billed to tenants by the managing agent are therefore recognised gross.
iv) Grant Income
Government grants that relate to the Group’s assets are accounted for as a reduction in the cost of the asset to which they relate. They are only recognised when there is both reasonable assurance that the Group will comply with all material conditions attached to the grant and that the grant will be received.
v) Property disposals
Where revenue is obtained by the sale of properties, it is recognised once the sale transaction has been completed, regardless of when contracts have been exchanged.
D Expenditure
All expenses are accounted for on an accruals basis. The investment management and administration fees, finance and all other revenue expenses are charged through the Consolidated Statement of Comprehensive Income as and when incurred. The Group also incurs capital expenditure which can result in movements in the capital value of the investment properties.
E Taxation
Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid to taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting date. Current income tax relating to items recognised directly in other comprehensive income or in equity is recognised in other comprehensive income and in equity respectively, and not in the income statement. Positions taken in tax returns with respect to situations in which applicable tax regulations are subject to interpretation, if any, are reviewed periodically and provisions are established where appropriate. The Group recognises liabilities for current taxes based on estimates of whether additional taxes will be due. When the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income and deferred tax provisions in the period in which the determination is made.
Deferred income tax is provided using the liability method on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax assets are recognised only to the extent that it is probable that taxable profit will be available against which deductible temporary differences, carried forward tax credits or tax losses can be utilised. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities. In determining the expected manner of realisation of an asset the Directors consider that the Group will recover the value of investment property through sale. Deferred income tax relating to items recognised directly in equity is recognised in equity and not in profit or loss.
As detailed further in note 6, the Group ceased being treated as a
Investment properties comprise completed property and property under construction or re-development that is held to earn rentals or for capital appreciation or both. Property held under a lease is classified as investment property when the definition of an investment property is met.
Investment properties are measured initially at cost including transaction costs. Transaction costs include transfer taxes, professional fees for legal services and initial leasing commissions to bring the property to the condition necessary for it to be capable of operating. The carrying amount also includes the cost of replacing part of an existing investment property at the time that cost is incurred if the recognition criteria are met.
Subsequent to initial recognition, investment properties are stated at fair value. Fair value is based upon the market valuation of the properties as provided by the external valuers as described in note 2.2. Gains or losses arising from changes in the fair values are included in the Consolidated Statement of Comprehensive Income in the year in which they arise.
For the purposes of these financial statements, in order to avoid double counting, the assessed fair value is:
i) Reduced by the carrying amount of any accrued income resulting from the spreading of lease incentives and/or minimum lease payments.
ii) Increased by the carrying amount of any liability to the superior leaseholder or freeholder (for properties held by the Group under operating leases) that has been recognised in the Balance Sheet as a finance lease obligation.
Acquisitions of investment properties are considered to have taken place on exchange of contracts unless there are significant conditions attached. For conditional exchanges acquisitions are recognised when these conditions are satisfied. Investment properties are derecognised when they have been disposed of and no future economic benefit is expected from their disposal. Any gains or losses on the disposal of investment properties are recognised in the Consolidated Statement of Comprehensive Income in the year of retirement or disposal.
Gains or losses on the disposal of investment properties are determined as the difference between net disposal proceeds and the carrying value of the asset in the previous full period financial statements.
G Investment properties held for sale
Non-current assets (and disposal groups) classified as held for sale are measured at the lower of carrying amount and fair value (except for investment property measured using fair value model).
Non-current assets and disposal groups are classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the asset (or disposal group) is available for immediate sale in its present condition. Management must be committed to the sale which should be expected to qualify for recognition as a completed sale within one year from the date of classification.
H Land
The Group’s land is capable of woodland creation and peatland restoration projects which would materially assist the Group’s transition to Net Zero.
Land is initially measured at cost including transaction costs. Transaction costs include transfer taxes and professional fees for legal services. Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Group. Land is not depreciated but instead, subsequent to initial recognition, recognised at fair value based upon periodic valuations provided by the external valuers. Gains or losses arising from changes in the fair values are included in the Consolidated Statement of Comprehensive Income in the year in which they arise.
I Trade and other receivables
Trade receivables are recognised and carried at the lower of their original invoiced value and recoverable amount. Where the time value of money is material, receivables are carried at amortised cost. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through use of an allowance account, and the amount of the expected credit loss is recognised in the Consolidated Statement of Comprehensive Income. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited in the Consolidated Statement of Comprehensive Income.
The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets.
A provision for impairment of trade receivables is established where the Property Manager has indicated concerns over the recoverability of arrears based upon their individual assessment of all outstanding balances which incorporates forward looking information. Given this detailed approach, a collective assessment methodology applying a provision matrix to determine expected credit losses is not used.
The amount of the provision is recognised in the Consolidated Balance Sheet and any changes in provision recognised in the Statement of Comprehensive Income.
J Cash and cash equivalents
Cash and cash equivalents are defined as cash in hand, demand deposits, and other short-term highly liquid investments readily convertible within three months or less to known amounts of cash and subject to insignificant risk of changes in value.
K Borrowings and interest expense
All loans and borrowings were initially recognised at the fair value of the consideration received, less issue costs where applicable. After initial recognition, all interest-bearing loans and borrowings are subsequently measured at amortised cost. Amortised cost is calculated by taking into account any discount or premium on settlement. Borrowing costs are recognised within finance costs in the Consolidated Statement of Comprehensive Income as incurred.
L Accounting for derivative financial instruments and hedging activities
Interest rate hedges are initially recognised at fair value on the date a derivative contract is entered into and are subsequently remeasured at their fair value. The method of recognising the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. The Group documents at the inception of the transaction the relationship between hedging instruments and hedged items, as well as its risk management objective and strategy for undertaking various hedging transactions. The Group also documents its assessment both at hedge inception and on an ongoing basis of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items.
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges are recognised in other comprehensive income in the Consolidated Statement of Comprehensive Income. The gains or losses relating to the ineffective portion are recognised in operating profit in the Consolidated Statement of Comprehensive Income.
Amounts taken to equity are transferred to profit or loss when the hedged transaction affects profit or loss, such as when the hedged financial income or financial expenses are recognised.
When a derivative is held as an economic hedge for a period beyond 12 months after the end of the reporting period, the derivative is classified as non-current consistent with the classification of the underlying item. A derivative instrument that is a designated and effective hedging instrument is classified consistent with the classification of the underlying hedged item.
M Service charge
IFRS15 requires the Group to determine whether it is a principal or an agent when goods or services are transferred to a customer. An entity is a principal if the entity controls the promised good or service before the entity transfers the goods or services to a customer. An entity is an agent if the entity’s performance obligation is to arrange for the provision of goods and services by another party.
Any leases entered into between the Group and a tenant required the Group to provide ancillary services to the tenant such as maintenance works etc, therefore these service charge obligations belonged to the Group. However, to meet this obligation the Group appointed a managing agent, Jones Lang Lasalle Inc “JLL” and directed it to fulfil the obligation on its behalf. The contract between the Group and the managing agent created both a right to services and the ability to direct those services. This was a clear indication that the Group operated as a principal and the managing agent operated as an agent. Therefore, it was necessary to recognise the gross service charge revenue and expenditure billed to tenants as opposed to recognising the net amount.
N Other financial liabilities
Trade and other payables are recognised and carried at invoiced value as they are considered to have payment terms of 30 days or less and are not interest bearing. The balance of trade and other payables are considered to meet the definition of an accrual and have been expensed through the Income Statement or Balance Sheet depending on classification. VAT payable at the Balance Sheet date will be settled within 31 days of the Balance Sheet date with Her Majesty’s Revenue and Customs (“HMRC”) and deferred rental income is rent that has been billed to tenants but relates to the period after the Balance Sheet date. Rent deposits recognised in note 13 as current are those that are due within one year as a result of upcoming tenant expiries.
2.4 Adjustments to going concern basis of accounting
In addition to assessing the Company’s significant and material accounting judgements, estimates and assumptions, the Board has also considered the following areas where it might be appropriate to apply adjustments to the ‘normal’ IFRS basis:
1) Measurement of Assets
It is appropriate to consider the need to write down assets to their net realisable value. Investment Properties including Land are stated at fair value, while other assets including trade receivables are recognised at their recoverable amount already. The Board has assessed the basis for and measurement of the residual interest in Land and have decided to reduce fair value by the estimated cost of disposal. Further details can be found in note 25.
2) Liabilities
The Board recognise that it would be appropriate to accrue costs associated with potentially onerous contracts by applying guidance in IAS 37 ‘Provisions, Contingent Liabilities and Contingent Assets’. However, at the date of approval of the financial statement, no such contracts exist, and accordingly no provisions have been made.
3) Presentation and disclosure
The Board has assessed the classification of assets and liabilities between current and non-current. Assets that met the criteria to be classified as held for sale at
After careful consideration, the Board believes that it would not be meaningful to present the results of discontinued operations as a separate financial statement line item of income or loss (in accordance with IFRS 5) because this would not result in meaningful information in a situation where all of an entity’s operations will be discontinued.
Finally, the Board has assessed whether adoption of a basis other than that of a going concern would have any material impact on comparatives and have concluded this not to be the case.
As at
3.
The Group’s principal financial liabilities have historically been loans and borrowings. The main purpose of the Group’s loans and borrowings were to finance the acquisition and development of the Group’s property portfolio. The Group had rent and other receivables, trade and other payables and cash and short-term deposits that arose directly from its operations.
The Group is exposed to market risk (including interest rate risk and real estate risk), credit risk, liquidity risk and capital risk. The Group is not exposed to currency risk or price risk. The Group is engaged in a single segment of business, being property investment in one geographical area, the
The Board of Directors reviews and agrees policies for managing each of these risks which are summarised below.
Market risk
Market risk is the risk that the fair values of financial instruments will fluctuate because of changes in market prices. The financial instruments held by the Group that were affected by market risk were principally the interest rate swap (which ended
i) Interest Rate risk
As described below the Group invested cash balances with Citibank, RBS and Barclays; the latter two were only relevant for the Company’s subsidiaries. In the current year the Company also made an investment in the abrdn
The bank borrowings as described in note 14 also historically exposed the Group to cash flow interest rate risk. The Group’s policy has historically been to manage its cash flow interest rate risk using interest rate derivatives (see note 15). The Group had floating rate borrowings at the point of sale of the subsidiaries of £113,300,000; £85,000,000 of these borrowings were fixed via an interest rate cap limiting the floating rate exposure to 3.959%.
The fair value of the derivative was exposed to changes in the market interest rate as their fair value was calculated as the present value of the estimated future cash flows under the agreements. The accounting policy for recognising the fair value movements in the interest rate derivatives is described in note 2.3 L.
Trade and other receivables and trade and other payables are interest free and have settlement dates within one year and therefore are not considered to present a fair value interest rate risk.
The tables below set out the carrying amount of the Company’s financial instruments excluding the amortisation of borrowing costs as outlined in note 14.
As at 31 December 2024 Fixed rate Variable rate Interest rate
£ £ £
Cash and cash equivalents - 3,807,736 0.000%
Cash held in abrdn Liquidity fund - 32,847,430 4.870%
Bank borrowings - - 0.000%
As at 31 December 2023 Fixed rate Variable rate Interest rate
£ £ £
Cash and cash equivalents - 6,653,838 0.000%
Bank borrowings 85,000,000 56,874,379 5.459%
At
At
Credit risk
Credit risk is the risk that a counterparty will be unable to meet a commitment that it has entered into with the Group.
With respect to credit risk arising from other financial assets of the Group, which comprise cash and cash equivalents, the Group’s exposure to credit risk arises from default of the counterparty with a maximum exposure equal to the carrying value of these instruments. As at
The abrdn
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulties in realising assets or otherwise raising funds to meet financial commitments. The investment property in which the Company invests is not traded in an organised public market and is illiquid. As a result, the Company may not be able to liquidate its investment in that property quickly at an amount close to its fair value in order to meet the Company’s liquidity requirements.
The following table summarises the maturity profile of the Group’s financial liabilities based on contractual undiscounted payments.
The disclosed amounts for interest-bearing loans and interest rate derivatives in the below table are the estimated net undiscounted cash flows.
The Company’s liquidity position is regularly monitored by management and is reviewed quarterly by the Board of Directors.
Year ended 31 December On demand 12 months 1 to 5 years >5 years Total
2024
£ £ £ £ £
Trade and other payables 18,297,427 - - - 18,297,427
18,297,427 - - - 18,297,427
Year ended 31 December On demand 12 months 1 to 5 years >5 years Total
2023
£ £ £ £ £
Interest-bearing loans - 8,442,998 152,428,127 - 160,871,125
Trade and other payables 7,514,629 52,450 209,800 5,140,100 12,916,979
Rental deposits due to - 299,124 713,058 181,945 1,194,127
tenants
7,514,629 8,794,572 153,350,985 5,322,045 174,982,231
Fair values
Set out below is a comparison by class of the carrying amounts and fair value of the Group’s financial instruments that are carried in the financial statements at amortised cost.
Carrying amount Fair Value
2024 2023 2024 2023
Financial Assets £ £ £ £
Cash and cash equivalents 36,655,166 6,653,838 36,655,166 6,653,838
Trade and other receivables 2,171,092 6,101,152 2,171,092 6,101,152
Financial liabilities
Bank borrowings - 141,251,910 - 144,957,576
Trade and other payables 18,297,427 8,217,588 18,297,427 8,217,588
In addition to the above, the Group's financial instruments in the past also included an Interest rate swap and Interest rate cap. These have not been included in the disclosure above as these were already held at fair value. The fair value of trade receivables and payables are materially equivalent to their amortised cost.
The fair value of the financial assets and liabilities are included at an estimate of the price that would be received to sell a financial asset or paid to transfer a financial liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate the fair value:
-- Cash and cash equivalents, trade and other receivables and trade and
other payables are the same as fair value due to the short-term
maturities of these instruments. Trade and other receivables/payables
are measured in reference to contractual amounts due to/from the Group.
These contractual amounts are directly observable.
-- The fair value of bank borrowings was estimated by discounting future
cash flows using rates currently available for debt on similar terms and
remaining maturities. The fair value approximated their carrying values
gross of unamortised transaction costs. This was considered as being
valued at level 2 of the fair value hierarchy.
The table below shows an analysis of the fair values of financial assets and liabilities recognised in the Balance Sheet by the level of the fair value hierarchy:
Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.
Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
Year ended 31 December 2024 Level 1 Level 2 Level 3 Total fair value
Financial assets
Trade and other receivables - 2,171,092 - 2,171,092
Cash and cash equivalents 36,655,166 - - 36,655,166
36,655,166 2,171,092 - 38,826,258
Financial liabilities
Trade and other payables - 18,297,427 - 18,297,427
- 18,297,427 - 18,297,427
Year ended 31 December 2023 Level 1 Level 2 Level 3 Total fair value
Financial assets
Trade and other receivables - 6,101,152 - 6,101,152
Cash and cash equivalents 6,653,838 - - 6,653,838
Interest rate cap - 1,408,781 - 1,408,781
Rental deposits held on behalf of 895,003 - - 895,003
tenants
Right of use asset - 1,810,120 - 1,810,120
7,548,841 9,320,053 - 16,868,894
Financial liabilities
Trade and other payables - 8,217,588 - 8,217,588
Bank borrowings - 144,957,576 - 144,957,576
Obligation under finance leases - 1,810,120 - 1,810,120
Rental deposits held on behalf of 895,003 - - 895,003
tenants
895,003 154,985,284 - 155,880,287
4. Administrative and Other Expenses
2024 2023
Notes £ £
Investment management fees 4a 1,399,114 2,632,225
Other direct property expenses
Vacant Costs (excluding void service charge) * 1,263,429 1,217,722
Repairs and maintenance 341,480 418,360
Letting fees 377,364 405,684
Other costs 464,747 366,695
Total Other direct property expenses 2,447,020 2,408,461
Net Impairment loss/(gain) on trade receivables 110,725 (213,048)
Fees associated with strategic review and aborted 4b 2,800,223 1,729,925
merger
Fees associated with managed wind down and disposal 4b 399,197 -
Other administration expenses
Directors’ fees and subsistence 23 389,757 239,436
Valuer’s fees 4c 57,835 75,524
Auditor’s fees 4d 167,125 192,700
Marketing 4a 118,425 222,893
Other administration costs 4e 772,043 406,189
Total Other administration expenses 1,505,185 1,136,742
Total Administrative and other expenses 8,661,464 7,694,305
* Void Service charge costs for the year amounted to £1,037,936 (2023: £1,470,241). These have been reclassified as Service charge expenditure as noted below.
2024 2023
£ £
Total service charge billed to tenants 4,244,088 4,731,793
Service charge due from/(to) tenants 655,793 152,564
Service charge income 4,899,881 4,884,357
Total service charge expenditure incurred 4,899,881 4,884,357
Service charge incurred in respect of void units 1,037,936 1,470,241
Service charge expenditure 5,937,817 6,354,598
4a. Investment management fees
From
As detailed further in Note 26, the Investment Manager receives an ‘Incentive Fee’ based on the cumulative Gross Disposal Proceeds relative to valuation of the portfolio as at
In addition, the Company paid the Investment Manager a sum of £98,688 excluding VAT (2023: £184,750 excluding VAT) to participate in the Managers marketing programme and
4b. Fees associated with strategic review, aborted merger and wind-down
As described in more detail in note 2.1, the Board undertook a strategic review during the second half of 2023 after concerns over the Company’s size, liquidity, persistent discount to NAV and dividend cover.
The outcome of this review, following interest from other listed REITs, was that the Board recommended to shareholders that they vote in favour of a proposed merger with Custodian REIT.
The costs associated with the initial Rule 2.7 announcement (including advisor, due diligence and valuation fees) were £2,041,248 of which £1,729,925 was accrued and unpaid at
4c. Valuers fee
The amount due and payable at the year-end amounted to £5,000 excluding VAT (2023: £18,665 excluding VAT).
4d. Auditor’s fee
At the year-end date
4e. Administration, secretarial and registrar fees
On
5. Finance income and costs
2024 2023
£ £
Interest income on cash and cash equivalents 649,889 92,178
Finance income 649,889 92,178
Interest expense on bank borrowings 7,607,108 8,119,398
Non-utilisation charges on facilites 216,940 198,314
Receipt on interest rate swap - (911,184)
Receipt on interest rate caps (910,100) (578,933)
Amortisation of premium paid for interest rate cap 762,904 565,030
Amortisation of arrangement costs (see note 14) 244,517 253,594
Finance lease interest 33,768 49,289
Finance costs 7,955,137 7,695,508
Of the finance costs above, £1,959,463 of the interest expense on bank borrowings were accruals at
6. Taxation
The Group migrated tax residence to the
As the principal company of the REIT, the Company was required to distribute at least 90% of the income profits of the Group’s
Following the sale of the Group’s subsidiaries on
The Company and its former
2024 2023
£ £
Loss before tax (42,839,090) (8,267,901)
Tax calculated at UK statutory corporation tax rate of (10,709,772) (1,942,957)
25% (2023*: blended rate of 23.5%)
Valuation loss in respect of Investment properties not 3,425,858 4,477,291
subject to tax (pre-29th Nov)
UK REIT exemption on net income (1,711,456) (2,534,334)
Valuation loss in respect of Lant at Far Ralia post 164,562 -
29th Nov
Valuation loss in respect of sale of Subsidiaries 8,885,918 -
Current income tax charge 55,110 -
* Calculated as a blended average of 23.5% being 3 months at the prevailing 19%, and 9 months at 25%.
7. Investment Properties
UK UK UK UK
Industrial Office Retail Other Total
2024 2024 2024 2024 2024
£ £ £ £ £
Market value 250,070,037 72,575,000 72,390,000 35,900,000 430,935,037
at 1 January
Purchase of
investment - - - - -
properties
Capital
expenditure - - - - -
on investment
properties
Opening
market value
of disposed (29,700,000) (15,350,000) - - (45,050,000)
investment
properties
Market value
prior to sale 220,370,037 57,225,000 72,390,000 35,900,000 385,885,037
of
subsidiaries
Opening
market value
of disposed (220,370,037) (57,225,000) (72,390,000) (35,900,000) (385,885,037)
investment
properties
Market value
at 31 - - - - -
December
Carrying
value at 31 - - - - -
December
Valuations have been performed by
UK UK UK UK
Industrial Office Retail Other Total
2023 2023 2023 2023 2023
£ £ £ £ £
Market value at 1 227,525,000 88,450,000 53,550,000 39,150,000 408,675,000
January
Purchase of
investment 4,367,140 - 19,619,261 - 23,986,401
properties
Capital
expenditure on 17,394,611 3,658,739 624,029 1,342 21,678,721
investment
properties
Opening market
value of disposed (6,400,000) - - - (6,400,000)
investment
properties
Valuation loss
from investment 6,062,225 (19,490,769) (1,360,741) (3,200,246) (17,989,531)
properties
Movement in lease 1,121,061 (42,970) (42,549) (51,096) 984,446
incentives
Market value at 250,070,037 72,575,000 72,390,000 35,900,000 430,935,037
31 December
Investment
property (19,750,000) (15,350,000) - - (35,100,000)
recognised as
held for sale
Market value net
of held for sale 230,320,037 57,225,000 72,390,000 35,900,000 395,835,037
at 31 December
Right of use
asset recognised - 1,810,120 - - 1,810,120
on leasehold
properties
Adjustment for (5,957,199) (1,943,609) (846,233) (559,362) (9,306,403)
lease incentives
Carrying value at 224,362,838 57,091,511 71,543,767 35,340,638 388,338,754
31 December
In the Cash Flow Statement, proceeds from disposal of investment properties comprise:
2024 2023
£ £
Opening market value of disposed investment properties 45,050,000 6,400,000
Loss on disposal of investment properties (2,063,652) (279,090)
Net proceeds from disposal of investment properties 42,986,348 6,120,910
Valuation Methodology
The fair value of completed investment properties were historically determined using the income capitalisation method.
The income capitalisation method is based on capitalising the net income stream at an appropriate yield. In establishing the net income stream the valuers reflected the current rent (the gross rent) payable to lease expiry, at which point the valuer assumed that each unit would be re-let at their opinion of ERV. The valuers made allowances for voids where appropriate, as well as deducting non recoverable costs where applicable. The appropriate yield was selected on the basis of the location of the building, its quality, tenant credit quality and lease terms amongst other factors.
The table below outlines the valuation techniques and inputs used to derive Level 3 fair values for each class of investment properties. The table includes:
-- The fair value measurements at the end of the reporting period.
-- The level of the fair value hierarchy (e.g. Level 3) within which the
fair value measurements are categorised in their entirety.
-- A description of the valuation techniques applied.
-- Fair value measurements, quantitative information about the significant
unobservable inputs used in the fair value measurement.
-- The inputs used in the fair value measurement, including the ranges of
rent charged to different units within the same building.
As noted above, all investment properties listed in the table below are categorised Level 3 and all are valued using the Income Capitalisation method.
Country & Class UK Industrial UK Office UK Retail UK Other
2023
Level 3 Level 3 Level 3 Level 3
Fair Value 2023 250,070,037 72,575,000 72,390,000 35,900,000
£
Initial Yield Initial Yield Initial Yield Initial Yield
Reversionary Reversionary Reversionary Reversionary
yield yield yield yield
Key
Unobservable Equivalent Equivalent Equivalent Equivalent Yield
Input 2023 Yield Yield Yield
Estimated Estimated Estimated Estimated rental
rental value rental value rental value value per sq ft
per sq ft per sq ft per sq ft
0.00% to 8.97% 4.56% to 10.51% 6.03% to 9.12% 5.40% to 9.30%
(4.80%) (7.57%) (6.91%) (6.53%)
4.74% to 8.79% 7.34% to 12.20% 5.52% to 7.99% 5.81% to 9.40%
Range (weighted (6.55%) (10.33%) (6.22%) (6.52%)
average) 2023
5.28% to 8.30% 7.04% to 9.98% 5.76% to 9.91% 5.58% to 9.21%
(6.46%) (8.89%) (7.02%) (6.67%)
£4.75 to £10.25 £15.79 to £0.00 to £30.61 £6.50 to £20.00
(£7.04) £45.94 (£27.08) (£11.35) (£14.49)
Descriptions and definitions
The table above includes the following descriptions and definitions relating to valuation techniques and key observable inputs made in determining the fair values.
Estimated rental value (ERV)
The rent at which space could be let in the market conditions prevailing at the date of valuation.
Equivalent yield
The equivalent yield is defined as the internal rate of return of the cash flow from the property, assuming a rise or fall to ERV at the next review or lease termination, but with no further rental change.
Initial yield
Initial yield is the annualised rents of a property expressed as a percentage of the property value.
Reversionary yield
Reversionary yield is the anticipated yield to which the initial yield will rise (or fall) once the rent reaches the ERV.
The table below shows the ERV per annum, area per square foot, average ERV per square foot, initial yield and reversionary yield as at the Balance Sheet date.
2024 2023
ERV p.a. £nil £34,189,042
Area sq.ft. - 3,503,840
Average ERV per sq.ft. £nil £9.76
Initial yield N/A 5.8%
Reversionary yield N/A 7.1%
The table below presents the sensitivity of the valuation to changes in the most significant assumptions underlying the valuation of completed investment property.
2024 2023
£ £
Increase in equivalent yield of 50 bps N/A (31,373,168)
Decrease in rental rates of 5% (ERV) N/A (15,910,176)
Below is a list of how the interrelationships in the sensitivity analysis above can be explained.
In both cases outlined in the sensitivity table the estimated Fair Value would increase (decrease) if:
-- The ERV is higher (lower)
-- Void periods were shorter (longer)
-- The occupancy rate was higher (lower)
-- Rent free periods were shorter (longer)
-- The capitalisation rates were lower (higher)
8. Land
2024 2023
£ £
Cost
Balance at the beginning of the year 9,595,555 8,061,872
Additions 2,300,154 2,154,160
Government Grant Income receivable (1,026,030) (620,477)
Balance at the end of the year 10,869,679 9,595,555
Accumulated depreciation and amortisation
Balance at the beginning of the year (1,345,555) (561,872)
Valuation gain/(loss) from land 475,876 (783,683)
Balance at the end of the year (869,679) (1,345,555)
Projected sales costs (see note 25) (165,000) -
Carrying amount as at 31 December 9,835,000 8,250,000
Valuation methodology
The Land is held at fair value and is categorised Level 3.
The Group appoints suitable valuers (such appointment is reviewed on a periodic basis) to undertake a valuation of the land on a quarterly basis, but going forward on a half yearly basis. The valuation is undertaken in accordance with the current RICS guidelines by
Additions represent costs associated with the reforestation and peatland restoration at Far Ralia.
Grants are receivable from the
As noted in more detail in note 2.1, the current Annual Report & Accounts are not prepared on a going concern basis with the carrying value reduced by estimated costs of disposal and £165,000 has been recognised to write down the Land to its projected net realisable value. Further details are provided in note 25.
The valuation above is sensitive to movements in the underlying inputs – an increase in the growth rate of Carbon Prices per T/CO 2 (10% over base assumptions during an initial 26-year period) would result in an increase in valuation of £1.8m. Whereas a decrease in growth rates (10% during the same period) would result in a decrease in valuation of £1.7m.
9. Investment Properties Held for Sale
Following the sale of the
subsidiaries on the
As at
In addition to the sales noted above, the Group also sold its industrial asset
10. Investments in Limited Partnership and Subsidiaries
The Company historically owned 100 per cent of the issued ordinary share capital of abrdn
-- abrdn Property Holdings Limited , a property investment company with
limited liability incorporated in Guernsey , Channel Islands .
-- abrdn (APIT) Limited Partnership, a property investment limited
partnership established in England .
-- abrdn APIT (General Partner ) Limited, a company with limited liability
incorporated in England , whose principal business is property
investment.
-- abrdn (APIT Nominee) Limited, a company with limited liability
incorporated and domiciled in England , whose principal business is
property investment.
On 29th November, the Company completed on the disposal of 100% of the share capital of abrdn
2024
£
Disposal of abrdn Property Holdings Limited 234,298,743
Less: transaction costs associated with the sale (5,237,261)
Net Proceeds 229,061,482
Net Assets of disposal Group at date of sale (post completion 276,614,616
account review)
Derecognition of Far Ralia (transferred to Company) (10,000,000)
Derecognition of Accrued Grant Income for Far Ralia (transferred to (1,646,507)
Company)
Trade and Other Receivables transferred to Company (505,296)
Adjusted Net Assets of disposal Group 264,462,813
Loss on Disposal of Subsidiaries 35,401,331
Reclassification of unrealised losses in Investment Portfolio to 12,751,247
Realised Losses
Realised Loss on Disposal of Subsidiaries 48,152,578
Included within the transaction costs associated with the sale, were £1,459,100 payable to the Investment Manager.
11. Trade and other receivables
2024 2023
£ £
Trade receivables 189,460 4,574,012
Less: provision for impairment of trade receivables (189,460) (832,240)
Trade receivables (net) - 3,741,772
Rental deposits held on behalf of tenants - 299,124
Accrued Grant Income (see Note 8) 1,646,507 620,477
Other receivables 524,585 1,439,779
Total trade and other receivables 2,171,092 6,101,152
Reconciliation for changes in the provision for impairment of trade receivables:
2024 2023
£ £
Opening balance (832,240) (2,137,972)
(Charge)/Credit for the year (110,725) 213,048
Reversal for amounts written-off 369,386 1,092,684
Derecognition on disposal of subsidiaries 384,119 -
Closing balance (189,460) (832,240)
The estimated fair values of receivables are the discounted amount of the estimated future cash flows expected to be received and approximate their carrying amounts.
Amounts are considered impaired when it becomes unlikely that the full value of a receivable will be recovered. Movement in the balance considered to be impaired have been included in other direct property costs in the Consolidated Statement of Comprehensive Income. As at
The ageing of these receivables is as follows:
2024 2023
£ £
0 to 3 months (9,485) (37,274)
3 to 6 months (18,299) (81,350)
Over 6 months (161,676) (713,616)
(189,460) (832,240)
If the provision for impairment of trade receivables increased by £1 million then the Company’s earnings and net asset value would decrease by £1 million. If it decreased by £1 million then the Company’s earnings and net asset value would increase by £1 million.
As of
12. Cash and cash equivalents
2024 2023
£ £
Cash held at bank 3,807,736 6,337,101
Cash held in abrdn Liquidity fund 32,847,430 -
Cash held on deposit with RBS - 316,737
36,655,166 6,653,838
Cash held at banks earns interest at floating rates based on daily bank deposit rates. Deposits are made for varying periods of between one day and three months, depending on the immediate cash requirements of the Group, and earn interest at the applicable short-term deposit rates. The abrdn Liquidity fund was £18.3bn in size at
13. Trade and other payables
2024 2023
£ £
Trade and other payables 6.860,858 7,023,461
VAT payable - 656,894
Deferred rental income - 6,038,976
Rental deposits due to tenants - 299,124
6,860,858 14,018,455
Trade and other payables are recognised at amortised cost. Trade payables are non-interest bearing and normally settled on 30-day terms.
14. Bank borrowings
2024 2023
£ £
Loan facility (including Rolling Credit Facility) - 165,000,000
Drawn down outstanding balance - 141,874,379
The Groups £165m debt facility with
2024 2023
£ £
Opening carrying value of expired facility as at 1 January - 109,928,234
Borrowings during the period on expired RCF - 25,000,000
Repayment of expired RCF - (25,000,000)
Repayment of expired facility - (110,000,000)
Amortisation arrangement costs - 71,766
Closing carrying value of expired facility - -
Opening carrying value of new facility as at 1 141,251,910 (804,297) January Borrowings during the period on new RCF 13,300,000 63,000,000 Repayment of new RCF (41,874,379) (6,125,621) New term loan facility - 85,000,000 Elimination of RCF indebtedness on sale (28,300,000) - Elimination of Term Loan indebtedness on sale (85,000,000) - Eliminate residual unamortised arrangement costs 377,952 - on sale Amortisation arrangement costs 244,517 181,828 Closing carrying value - 141,251,910
Opening carrying value of facilities combined as at 1 141,251,910 109,123,937 January Closing carrying value of facilities combined - 141,251,910
2024 2023
£ £
Amortisation of arrangement costs (expired facility) - 71,766
Amortisation of arrangement costs (new facility) 244,517 181,828
See Note 5 244,517 253,594
Cash and Interest-bearing 2024 Cash and Interest-bearing 2023
Analysis of cash loans cash loans
movement in equivalents Net debt equivalents Net debt
net debt £ £
£ £ £ £
Opening 6,653,838 (141,251,910) (134,598,072) 15,871,053 (109,123,937) (93,252,884)
balance
Cash 32,851,922 28,574,379 61,426,301 (9,217,215) (31,874,379) (41,091,594)
movement
Elimination (2,850,594) 112,922,048 110,071,454 - - -
on sale
Amortisation
of - (244,517) (244,517) - (253,594) (253,594)
arrangement
costs
Closing 36,655,166 - 36,655,166 6,653,838 (141,251,910) (134,598,072)
balance
All loan covenants were met during the year ended
2024 2023
£ £
Loan amount - 141,874,379
Cash - (6,653,838)
- 135,220,541
Investment property valuation 10,000,000 439,185,037
LTV percentage N/A 30.8%
The loan facility was secured by fixed and floating charges over the assets of the Company and its wholly owned subsidiaries, abrdn
15. Interest rate Swap and Cap
In order to mitigate any interest rate risk linked to their debt facilities, the Group's policy was to manage its cash flow using hedging instruments. The following hedging instruments were effective during the year:
15a Historic Interest Rate Swap
The Group had previously taken out an interest rate swap of a notional amount of £110,000,000 with RBS as part of a refinancing exercise in
2024 2023
£ £
Opening fair value of interest rate swaps at 1 January - 1,238,197
Reclassification of interest accrual - (335,663)
Valuation (loss)/gain on interest rate swap - (902,534)
Reclassified to Profit & Loss - -
Closing fair value of interest rate swap at 31 December - -
15b Interest Rate Cap
Simultaneously to the breaking of the £85,000,000 swap, the Group agreed an interest rate cap against a notional amount of £85,000,000 (due to commence
2024 2023
£ £
Opening fair value of interest rate cap at 1 January 1,408,781 2,550,469
Net Change in fair value (794,477) (1,141,688)
Derecognition of Interest Rate Cap on disposal of (614,304) -
subsidiary
Closing fair value of interest rate cap at 31 December - 1,408,781
The change in fair value of the interest rate cap comprises fair value changes and interest received, paid and accrued.
2024
Cost of hedging Cash flow hedge Total
£ £ £
Opening fair value 625,276 783,505 1,408,781
Valuation (loss)/gain (625,276) 871,254 245,978
Interest received - (1,040,455) (1,040,455)
Net Change in fair value (625,276) (169,201) (794,477)
Closing fair value of interest rate - 614,304 614,304
cap at 31 December
Less Closing Interest Accrual * - (82,903) (82,903)
Adjusted fair value of interest rate - 531,401 531,401
cap at 31 December
Opening Adjusted fair value of 625,276 783,505 1,408,781
interest rate cap at 1 January
Valuation (loss)/gain recognised on (625,276) (252,104) (877,380)
Adjusted Valuation
Net Change in fair value (as above) (625,276) (169,201) (794,477)
Less Closing Interest Accrual (as - (82,903) (82,903)
above) *
Valuation (loss)/gain recognised on (625,276) (252,104) (877,380)
Adjusted Valuation
2024
Interest Rate Cap Cost of hedging
Reserves reserve Cash flow hedge reserve Total
Reconciliation
£ £ £
Opening Reserve (1,316,871) 570,245 (746,626)
Valuation (loss)/gain
recognised on Adjusted (625,276) (252,104) (877,380)
Valuation
Less Prior accrual - 213,260 213,260
Amortisation of 762,904 - 762,904
Premium (See Note 5)
Valuation loss as
recognised in Other 137,628 (38,844) 98,784
Comprehensive Income
Derecognition of 1,179,243 - 1,179,243
residual premium
Derecognition of - (531,401) (531,401)
residual value
Closing Reserve - - -
* As the valuation of the interest rate cap includes a valuation attributable to the unsettled interest (due to 21st January) a separate accrual has not been recorded in the balance sheet. Instead, this represents a recycling of the change in Other Comprehensive Income for the Cash flow hedge to Finance Cost.
2023
Cost of hedging Cash flow hedge Total
£ £ £
Opening fair value 1,779,151 771,318 2,550,469
Valuation (loss)/gain (1,153,875) 377,860 (776,015)
Interest received - (365,673) (365,673)
Net Change in fair value (1,153,875) 12,187 (1,141,688)
Closing fair value of interest rate 625,276 783,505 1,408,781
cap at 31 December
Less Closing Interest Accrual * - (213,260) (213,260)
Adjusted fair value of interest rate 625,276 570,245 1,195,521
cap at 31 December
Opening Adjusted fair value of 1,779,151 771,318 2,550,469
interest rate cap at 1 January
Valuation (loss)/gain recognised on (1,153,875) (201,073) (1,354,948)
Adjusted Valuation
Net Change in fair value (as above) (1,153,875) 12,187 (1,141,688)
Less Closing Interest Accrual (as - (213,260) (213,260)
above) *
Valuation (loss)/gain recognised on (1,153,875) (201,073) (1,354,948)
Adjusted Valuation
2023
Interest Rate Cap Cost of hedging
Reserves reserve Cash flow hedge reserve Total
Reconciliation
£ £ £
Opening Reserve (728,026) 771,318 43,292
Valuation (loss)/gain
recognised on Adjusted (1,153,875) (201,073) (1,354,948)
Valuation
Amortisation of 565,030 - 565,030
Premium (See Note 5)
Valuation gain as
recognised in Other (588,945) (201,073) (789,918)
Comprehensive Income
Closing Reserve (1,316,871) 570,245 (746,626)
The Interest associated with the cap recognised as an offset against Finance Cost is summarised below:
2024 2023
£ £
Interest received 1,040,455 365,673
Closing Interest Accrual 82,903 213,260
Less Interest Accrued from prior year (213,260) -
Receipt on interest rate caps (see Note 5) 910,098 578,933
The spilt of the interest rate cap is listed below:
2024 2023
£ £
Current assets/(liabilities) - 849,110
Non-current assets/(liabilities) - 559,671
Interest rate cap with a start date of 27 April 2023 maturing on - 1,408,781
26 April 2026
16. Obligations under Finance Leases
Present value of
Minimum lease
Interest minimum lease
payments
payments
2023 2023 2023
£ £ £
Less than one year 52,450 (49,202) 3,248
Between two and five years 209,800 (195,892) 13,908
More than five years 5,140,100 (3,347,135) 1,792,965
Total 5,402,350 (3,592,229) 1,810,121
The above table shows the historic present value of future lease payments in relation to the ground lease payable at
17. Lease analysis
The Group had historically granted leases on its property portfolio. As at
Future minimum rentals receivable under non-cancellable operating leases as at 31 December are as follows:
2024 2023
£ £
Within one year - 27,137,392
Between one and two years - 22,839,051
Between two and three years - 19,036,836
Between three and four years - 14,949,198
Between four and five years - 12,718,074
More than 5 years - 78,172,826
Total - 174,853,377
As at the year-end, the Company had no tenants – in the prior year, the largest single tenant at the year-end accounted for 5.7% of the annual passing rent prevailing at the time.
18. Share capital
Under the Company’s Articles of Incorporation, the Company may issue an unlimited number of ordinary shares of
Allotted, called up and fully paid: 2022 2023
£ £
Opening balance 228,383,857 228,383,857
Shares issued - -
Closing balance 228,383,857 228,383857
Redeemable Bonus Shares
Following the disposal of the Group's subsidiaries on
2024 2023
£ £
Opening balance - -
Shares redeemed during the year 198,233,868 -
Closing balance 198,233,868 -
Winding Up Shares
As previously announced, the Board intends that the Company is placed into voluntary winding up at an appropriate time with the exact timing of being dependent on a number of factors, which may include progress with the sale of Far Ralia.
Placing the Company into Voluntary Winding Up would normally require the approval of Shareholders at the General Meeting. However, to prevent the need for a further General Meeting, and because
On
Treasury Shares
In 2022, the Company undertook a share buyback programme at various levels of discount to the prevailing NAV. In the period to
2024 2023
£ £
Opening balance 18,400,876 18,400,876
Bought back during the year - -
Closing balance 18,400,876 18,400,876
The number of shares in issue as at 31
December 2024/2023 are as follows
2024 2023
Number of shares Number of shares
Opening balance 381,218,977 381,218,977
Issue of Redeemable Bonus Share 381,218,977 -
Redemption / cancellation of Redeemable Bonus (381,218,977) -
Shares
Closing balance 381,218,977 381,218,977
19. Reserves
The detailed movement of the below reserves for the years to
Retained earnings
This is a distributable reserve and represents the cumulative revenue earnings of the Group less dividends paid to the Company’s shareholders.
Capital reserves
This reserve represents realised gains and losses on disposed investment properties and unrealised valuation gains and losses on investment properties and cash flow hedges since the Company’s launch.
Other distributable reserves
This reserve represents the share premium raised on launch of the Company which was subsequently converted to a distributable reserve by special resolution dated
20. Earnings per share
Basic earnings per share amounts are calculated by dividing profit/loss for the year net of tax attributable to ordinary equity holders by the weighted average number of ordinary shares outstanding during the year. As there are no dilutive instruments outstanding, basic and diluted earnings per share are identical.
The earnings per share for the year is set out in the table below.
The following reflects the income and share data used in the basic and diluted earnings per share computations:
2024 2023
£ £
Loss for the year net of tax (42,894,200) (8,267,901)
2024 2023
Weighted average number of ordinary shares outstanding 381,218,977 381,218,977
during the year
Loss per ordinary share (pence) (11.25) (2.17)
Profit for the year excluding capital items (£) 7,011,154 10,824,203
21. Dividends and Property Income Distributions Gross of Income Tax
12 months to Dec 24 12 months to Dec 23
PID Non-PID Total PID Non-PID PID Non-PID Total PID Non-PID
Dividends
pence pence Pence £ £ pence pence Pence £ £
Quarter to
31 December
of prior 0.3980 0.6020 1.0000 1,517,252 2,294,938 - 1.0000 1.0000 - 3,812,190
year (paid
in February)
Quarter to
31 March 1.0000 - 1.0000 3,812,190 - 1.0000 - 1.0000 3,812,190 -
(paid in
May)
Quarter to
30 June 0.4500 0.5500 1.0000 1,715,485 2,096,705 1.0000 - 1.0000 3,812,190 -
(paid in
August)
Quarter to
30 September 0.3000 0.7000 1.0000 1,143,657 2,668,533 - 1.0000 1.0000 - 3,812,190
(paid in
November)
Total
dividends 2.1480 1.8520 4.0000 8,188,584 7,060,176 2.0000 2.0000 4.0000 7,624,380 7,624,380
paid
Quarter to
31 December
of current - - - - - 0.3980 0.6020 1.0000 1,517,252 2,294,938
year (paid
after year
end)
Distribution
on exiting
REIT regime 3.0000 - 3.0000 11,436,569 - - - - - -
(paid after
year end)
Prior year
dividends (0.3980) (0.6020) (1.0000) (1,517,252) (2,294,938) - (1.0000) (1.0000) - (3,812,190)
(per above)
Total
dividends 4.7500 1.2500 6.0000 18,107,901 4,765,238 2.3980 1.6020 4.0000 9,141,632 6,107,128
paid for the
year
On
22. Reconciliation of Audited Consolidated NAV to Unaudited Published NAV
The NAV attributable to ordinary shares is published quarterly and is based on the most recent valuation of the investment properties.
2024 2023
Number of ordinary shares at the reporting date 381,218,977 381,218,977
2024 2023
£ £
Total equity per audited consolidated financial 30,363,831 298,078,443
statements
NAV per share (p) 8.0 78.2
Published NAV per share (p) 8.0 78.4
The variance between the unaudited published NAV and audited consolidated NAV recorded in 2023 of 0.2p per share represents the recognition of fees associated with the strategic review and proposed merger, the identification of a backdated rent review post publication but agreed prior to year-end, and the recognition of accrued grant income not yet received.
23. Related Party Disclosures
Directors’ remuneration
The Directors of the Company are deemed as key management personnel and received fees for their services. Total fees for the year were £389,757 (2023: £239,436) none of which remained payable at the year-end (2023: nil).
abrdn
2024 2023
£ £
Mike Balfour 46,000 41,500
Mike Bane 40,000 37,000
James Clifton-Brown 55,000 50,000
Jill May 42,500 37,000
Sarah Slater 40,000 37,000
One-off fee* 110,000 -
Employers’ national insurance contributions 41,746 23,735
375,246 226,235
Directors’ expenses 14,511 13,201
389,757 239,436
* As noted in the Directors’ Remuneration Report in the full Annual Accounts, each Director received a one-off fee of £20,000 with the Former Chair receiving £30,000 to partially reflect the additional work performed.
Distributions from Subsidiaries
While part of the Group, the Company received £21.1m by way of distributions from its immediate wholly owned subsidiary abrdn
24. Segmental Information
The Board has considered the requirements of IFRS 8 ‘operating segments’. The Board is of the view that the Group is engaged in a single segment of business, being property investment and in one geographical area, the
25. Non-Going Concern adjustment for estimated costs of disposal of property portfolio
As explained in note 2 the Group’s financial statements are no longer prepared on a going concern basis. The Board have assessed the consequences of this and the decision made in
Investment Investment Properties
Properties Land Total
Held for Sale
£ £ £ £
Market Value - - 10,000,000 10,000,000
Assumed average - - (125,000) (125,000)
sales costs of 1.25%
Aberdeen disposal - - (40,000) (40,000)
fee
Estimated disposal - - (165,000) (165,000)
costs
Carrying Value - - 9,835,000 9,835,000
The assumed rate of 1.25% in the table above represents the best estimate of a reasonable sales cost for Far Ralia. The Aberdeen disposal fee has been calculated in accordance with the terms of the revised IMA as explained in note 4a. As part of their consideration of adopting a basis other than that of a going concern, the Board have also considered the potential impact on comparatives.
As noted below, as at
Investment Investment Properties
Properties Land Total
Held for Sale
£ £ £ £
Market Value 395,835,037 35,100,000 8,250,000 439,185,037
Assumed average (4,947,938) (438,750) (103,125) (5,489,813)
sales costs of 1.25%
Aberdeen disposal (1,583,340) (140,400) (33,000) (1,756,740)
fee
Estimated disposal (6,531,278) (579,150) (136,125) (7,246,553)
costs
Carrying Value 389,303,759 34,520,850 8,113,875 431,938,484
As detailed in note 2, the Investment portfolio (which consisted of the remaining portfolio following the disposal of 6 assets during 2024) was sold as a single transaction to
26. Commitments and Contingent Liabilities
The Company had no contracted capital commitments as at
As discussed in note 4, following the Shareholder vote to place the Group into a Managed Wind-Down, a new agreement with the Investment Manager was signed effective
Following the sale of the Group’s subsidiaries on 29th November, the cumulative Gross Disposal Proceeds (which excludes Far Ralia) was £364,775,000. As such, if Far Ralia is sold prior to
Threshold Valuation
£ £
Cumulative Gross Disposal Proceeds (to date) 364,775,000 364,775,000
Theoretical Gross Disposal Proceeds of Far Ralia 1,876,000 10,000,000
Theoretical Gross Disposal Proceeds of May 2024 366,651,000 374,775,000
Portfolio
Incentive Fee Incentive Fee
£ £
Sold after 28 November 2025 (0.00%) - -
Sold prior to 28 November 2025 (0.05%) 183,326 187,388
Sold prior to 28 May 2025 (0.10%) 366,651 374,775
As detailed further in note 4a, the Investment Manager receives a Disposal fee of 0.4% of the Gross Disposal Price.
Given that the fee is dependent on the timing of the future sale of Far Ralia, neither the Disposal nor Incentive Fees have been accrued in the results as at
27. Events after the balance sheet date
Dividends
On
This Annual Financial Report announcement is not the Company's statutory accounts for the year ended
Please note that past performance is not necessarily a guide to the future and that the value of investments and the income from them may fall as well as rise. Investors may not get back the amount they originally invested.
All enquiries to:
The Company Secretary
Trafalgar Court
Les Banques
GY1 3QL
Tel: 01481 745001
Fax: 01481 745051
Tel: 07801039463 or jason.baggaley@aberdeenplc.com
Tel: 07703695490 or mark.blyth@aberdeenplc.com
Tel: 07789676852 or craig.gregor@aberdeenplc.com
