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Financial Review / Continued
Net finance costs Our cost of debt increased from £9.0 million to £9.5 million. This was mainly due to amounts drawn under our revolving credit facility with interest charged at 150bps above SONIA. The revolving credit facility balance outstanding as at 31 March 2024 was £16.4 million which was repaid following the year-end. Interest income received during the year was £0.6 million, which reflects the higher interest rate environment in addition to amounts received from managing agents in respect of interest on client monies from previous periods. Dividends This year, we maintained our quarterly dividend rate of 0.875 pence per share, equating to an annual rate of 3.5 pence per share. Total dividends paid out were £19.1 million, in line with 2023. Dividend cover for the year was 114%. Following the year-end we increased our annual dividend rate to 3.7 pence per share, following the sale of Angel Gate, London and subsequent debt repayment. Investment properties As at 31 March 2024, the portfolio comprised 49 assets and the appraised value was £744.6 million. The negative capital movement on the portfolio was £26.5 million for the year, which was primarily driven by yield movement. There were no acquisitions or disposals completed during the year, however, we exchanged contracts to sell the following office assets, which are classified as assets held for sale as at 31 March 2024: / Longcross, Cardiff / Angel Gate, London We have continued to invest in the property portfolio and incurred £4.5 million in capital expenditure during the financial year to support the rental income increases and capital values over the medium to longer-term.
Summary of borrowings
2024
2023
2022
211.1
Fixed rate loans (£m)
212.6 213.9
16.4
Drawn revolving facility (£m)
11.9
4.9
227.5 207.7
Total borrowings (£m)
224.5 218.8 204.4 180.3
Borrowings net of cash (£m)
33.6 27.9
Undrawn facilities (£m) Loan to value ratio (%)
38.1 26.7
45.1 21.2
3.9 7.2
Weighted average interest rate (%)
3.8 8.4
3.7 9.6
Average duration (years)
Cash flow and liquidity During the year, our cash balances reduced by £0.3 million. The cash flow from operating activities this year was £20.2 million and we invested £4.5 million in capital expenditure into the property portfolio. Overall borrowings increased by £3.1 million and dividends paid were £19.1 million. Our cash balance at the year-end stood at £19.8 million. Share capital No new ordinary shares were issued during the year. The Company’s Employee Benefit Trust now holds 1,642,440 shares. As the Trust is consolidated into the Group’s results, these shares are effectively held in treasury and
In line with last year, the value of the floor that we occupy at Stanford Building, London, has been excluded from the value of Investment Properties and included separately with Property, Plant and Equipment. Any capital movements arising from the revaluation of this element of the property are shown within the Consolidated Statement of Comprehensive Income. Borrowings Total borrowings were £227.5 million at 31 March 2024, with the loan to value ratio at 27.9%. The weighted average interest rate on our borrowings was 3.9% while the average loan duration was 7.2 years. The fair value of our drawn borrowings at 31 March 2024 was £202.8 million, lower than the book value by some £24.7 million. As a result, our EPRA NDV asset value was £549 million at 31 March 2024, higher than the reported net assets under IFRS. Both lending margins and gilt yields continue to be higher relative to the rates set on our facilities. At 31 March 2024, we had £16.4 million drawn under revolving credit facility, which was fully repaid in April 2024 with the sale proceeds from Angel Gate, London. The £50.0 million facility matures in May 2025 and we will seek to extend it during the year in order to provide flexibility to execute transactions and manage cash flow. We have strong banking relationships with our lenders; the Group has remained fully compliant with its loan covenants and has made scheduled amortisation payments during the year of £1.4 million.
therefore have been excluded from the net asset value and earnings per share calculations, from the date of purchase. Saira Johnston Chief Financial Officer 22 May 2024
Picton Property Income Limited / Annual Report 2024 40
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