Financial Statements
Notes to the consolidated financial statements continued for the year ended 31 March 2022 18. Loans and borrowings
2022 £000
2021 £000
Maturity
Current Aviva facility
1,372
– –
1,314
(304)
Capitalised finance costs
(370)
1,068
944
Non-current Canada Life facility
24 July 2031 129,045
80,000 84,894
83,518 4,900 (1,699)
Aviva facility
24 July 2032 26 May 2025
NatWest revolving credit facility Capitalised finance costs
–
– (2,183) 215,764 162,711 216,832 163,655 The following table provides a reconciliation of the movement in loans and borrowings to cash flows arising from financing activities.
2022 £000
2021 £000
163,655 165,136
Balance at start of year
Changes from financing cash flows Proceeds from loans and borrowings Repayment of loans and borrowings
79,545 (26,917)
–
(1,258) (574) (1,832)
(419)
Financing costs paid
52,209
Other changes Amortisation of financing costs Change in accrued financing costs
967
531 (180)
1
968
351
Balance as at 31 March 216,832 163,655 The Group has refinanced its existing loan facility with Canada Life increasing borrowings to £129.0 million and extending the maturity date until July 2031. Interest is now fixed at 3.25% (previously 4.08%) over the remaining life of the loan. A debt prepayment fee of £4.0 million was incurred during the year to reset the interest rate on the existing debt. The loan agreement has a loan to value covenant of 65% and an interest cover test of 1.75. The loan is secured over the Group’s properties held by Picton No 2 Limited Partnership and Picton UK Real Estate Trust (Property) No 2 Limited, valued at £415.2 million (2021: £330.0 million). Additionally, the Group has a £95.3 million term loan facility with Aviva Commercial Finance Limited which matures in July 2032. The loan is for a term of 20 years and was fully drawn on 24 July 2012 with approximately one-third repayable over the life of the loan in accordance with a scheduled amortisation profile. The Group has repaid £1.3 million in the year (2021: £1.3 million). Interest on the loan is fixed at 4.38% over the life of the loan. The facility has a loan to value covenant of 65% and a debt service cover ratio of 1.4. The facility is secured over the Group’s properties held by Picton No 3 Limited Partnership and Picton Property No 3 Limited, valued at £208.1 million (2021: £184.9 million). The Group also has a £50 million revolving credit facility (‘RCF’) with National Westminster Bank Plc which matures in May 2025. There is currently £4.9 million drawn under the facility, interest is charged at 150 basis points over SONIA from 20 January 2022 (previously 150 basis points over LIBOR) on drawn balances and there is an undrawn commitment fee of 60 basis points. The facility is secured on properties held by Picton UK Real Estate Trust (Property) Limited, valued at £163.2 million (2021: £131.7 million). The fair value of the drawn loan facilities at 31 March 2022, estimated as the present value of future cash flows discounted at the market rate of interest at that date, was £225.6 million (2021: £187.2 million). The fair value of the secured loan facilities is classified as Level 2 under the hierarchy of fair value measurements. There were no transfers between levels of the fair value hierarchy during the current or prior years. The weighted average interest rate on the Group’s borrowings as at 31 March 2022 was 3.7% (2021: 4.2%).
Picton Property Income Limited Annual Report 2022
132
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