For professional investors and advisers only. Schroder UK Property Fund Interim Unaudited Consolidated Financial Statements.

Transcription

1 For professional investors and advisers only Schroder UK Property Interim Unaudited Financial Statements

2 1 Schroder UK Property Interim Unaudited Financial Statements REPORT OF THE AUTHORISED CORPORATE DIRECTOR AND STATEMENT OF RESPONSIBILITIES The Financial Statements We are pleased to present the Unaudited Financial Statements of the Schroder UK Property for the period ended. The Schroder UK Property (the ) is an investment with variable capital incorporated in England and Wales under registered number IC and authorised by the FCA with effect from 31 July The has an unlimited duration. The shareholders are not liable for any debts of the. The investment objective of the is to undertake Real Estate Investment Business and to manage cash raised from investors for investment in the Real Estate Investment Business, with the intention of achieving a blend of income and capital growth. The s target return is to achieve 0.5 per cent per annum (net of all fees and expenses) above the benchmark (the AREF/IPD UK Quarterly Property Index All Balanced Property Index Weighted Average) over rolling three year periods. The will seek to diversify risk by holding a mixed portfolio of retail, office, industrial and other real estate throughout the UK. The policy for achieving these objectives is that the will invest in UK real estate. The may also invest in transferable securities (including REITs, government bonds and unquoted companies), units in collective investment schemes, units in unregulated collective investment schemes (which may include unauthorised property unit trusts and limited partnerships), money market instruments, deposits, cash and cash equivalents. Authorised Status From 31 July 2012 the was authorised as an Open-Ended Investment under Regulation 12 of the Open-Ended Investment Companies Regulations Annual General Meetings The will not be holding any Annual General Meetings. Statement of Responsibilities The Financial Conduct Authority s Collective Investment Schemes Sourcebook (COLL) requires the Authorised Corporate Director (ACD) to prepare accounts for each annual and half yearly accounting period, in accordance with United Kingdom Generally Accepted Accounting Practice, which give a true and fair view of the financial position of the fund and of its net revenue and the net capital gains on the real estate of the fund for the year. In preparing the accounts the ACD is required to: select suitable accounting policies and then apply them consistently; comply with the disclosure requirements of the Statement of Recommended Practice for Authorised s issued by the IMA in October 2010; follow generally accepted accounting principles and applicable accounting standards; prepare the accounts on the basis that the fund will continue in operation unless it is inappropriate to do so; and, keep proper accounting records which enable it to demonstrate that the accounts as prepared comply with the above requirements. The ACD is responsible for the management of the fund in accordance with its Trust Deed, Prospectus and COLL and for taking reasonable steps for the prevention and detection of fraud, error and non-compliance with law or regulations. The ACD s report and accounts for the period ended were signed on 9 December 2014 on behalf of the ACD by: C.E. Helmstetter P. Wallace Schroder Unit Trusts Limited 9 December 2014

3 Schroder UK Property Interim Unaudited Financial Statements 2 INVESTMENT MANAGER S STATEMENT OF RESPONSIBILITY The ACD has delegated to the Investment Manager the function of managing the investment and reinvestment of the assets of the. On 31 July 2012, the ACD appointed Schroder Property Investment Management Limited to provide investment management, property management and advisory services to the ACD. Schroder Property Investment Management Limited was renamed to Schroder Real Estate Investment Management Limited ( Schroder Real Estate ) with effect from 28 November Schroder Real Estate is a member of the same group as the ACD. The Investment Manager has discretionary responsibility for implementing investment policy and is responsible to investors for the performance of the. Adherence to such policies are monitored quarterly through reporting by the Investment Manager to the Real Estate Investment Risk Committee which is an integral part of the Schroders Investment Risk Framework (SIRF). The Investment Manager is also responsible for marketing the, pricing and accounting for the, providing all relevant information to valuers, managing agents and the team responsible for pricing the and for providing performance information to IPD (Investment Property Databank). All delegated appointments by the Investment Manager are on an advisory basis. Subject to the investment objectives and restrictions contained in the OEIC Regulations and the COLL (Collective Investment Schemes) Sourcebook and the investment and borrowing guidelines contained in this prospectus, the Investment Manager has discretion to take decisions in relation to the management of the, without prior reference to the ACD. As required by COLL, the Investment Manager must obtain the consent of the Depositary for the acquisition or disposal of immovable real estate. Legal and product limits The prospectus, which has been approved by the FCA, sets out the nature of permitted investments and the broad parameters within which the fund must be managed. If one of these is breached, depending on the nature of the breach, they are reportable to the FCA and subject to agreed remedies. These are shown as legal limits in the table below. The Investment Manager confirms that these limits have not been breached in the period to. Other risk controls such as product limits shown in the table below are also monitored as part of SIRF which is a Group-wide control process designed to ensure that products and portfolios are managed in a manner that is consistent with their performance objectives and corresponding risk profiles. From time to time the Investment Manager may propose revisions to the Product limits in order to better control the risks which may impact the s ability to achieve its objectives. Any changes will require the approval of SIRF and the ACD. From the beginning of 2014 the Investment Manager will change the way in which sector exposure is managed. The new approach, which analyses the aggregate weighting to 13 market segments, will replace the current four sector risk control. Legal limits Product limits Minimum 60% its assets (NAV) must form part of its Real Estate Investment Business Minimum 60% its income must come from the Real Estate Investment Business Maximum aggregate investment in indirect vehicles: 40% NAV Maximum 15% of the NAV invested in a single asset Maximum 20% of the NAV committed to development (on/off balance sheet) Maximum borrowing (on/off balance sheet): 25% NAV Investment on and off balance sheet in shorter/medium term leaseholds (less than 50 years): 20% NAV Maximum speculative development: 15% NAV Sector exposure: Maximum absolute load difference +/- 50% vs benchmark. Maximum divergence of central London +/- 10%. Maximum divergence in alternatives +/- 10%. Investment in a single indirect vehicle: 15% NAV Aggregate investment in indirect vehicles: 35% NAV Aggregate investment in joint ventures: 35% NAV Investment in UK real estate related listed securities: aggregate 10% NAV individual 2.5% NAV Maximum investment in undeveloped and non income producing land: 10% NAV Maximum on and off balance sheet percentage income from non government tenant: 10% Investment in undeveloped and non income producing land: 10% NAV Maximum on balance sheet uncommitted cash: 10% NAV Maximum on and off balance sheet debt: 25% NAV

4 3 Schroder UK Property Interim Unaudited Financial Statements STATEMENT OF TOTAL RETURN For the six months ended Income Net capital gains 107, ,465 75,323 75,323 Revenue 47,285 46,291 41,911 40,518 Expenses (15,220) (14,224) (12,612) (11,217) Gain attributable to minority interest 2 2 Net revenue before taxation 32,067 32,067 29,301 29,301 Taxation Net revenue after taxation 32,067 32,067 29,301 29,301 Total return before distribution 139, , , ,624 Finance costs: distributions (34,492) (34,492) (31,418) (31,418) Change in net assets attributable to shareholders from investment activities 105, ,040 73,206 73,206 STATEMENT OF CHANGE IN NET ASSETS ATTRIBUTABLE TO SHAREHOLDERS For the six months ended Opening net assets attributable to shareholders 1,489,460 1,489,460 1,317,934 1,317,934 Amounts receivable on issue of shares 136, ,392 98,319 98,319 Amounts payable on cancellation of shares Net amounts receivable on issue of shares 136, ,392 98,319 98,319 Change in net assets attributable to shareholders from investment activities 105, ,040 73,206 73,206 Closing net assets attributable to shareholders 1,730,892 1,730,892 1,489,460 1,489,460

5 Schroder UK Property Interim Unaudited Financial Statements 4 BALANCE SHEET At ASSETS Investment Assets 1,285,498 1,159,412 1,218,464 1,104,279 Investment in Collective Investment Schemes 161, ,450 82,862 82,862 Investment in subsidiaries 151, ,880 Investment in joint ventures 140, , , ,412 Total Investment Assets 1,587,874 1,612,879 1,426,738 1,428,433 Debtors 36,592 34,694 22,074 21,366 Cash and cash equivalents 139, ,676 80,898 73,547 Total other assets 170, , ,972 94,913 Total assets 1,758,233 1,753,101 1,529,710 1,523,346 LIABILITIES Creditors 23,064 22,637 29,960 28,235 Distribution payable 5,719 5,719 5,651 5,651 Net assets attributable to third party minority investors 1, Long Term liabilities Loans 3,700 3,700 Total liabilities 27,340 22,208 40,250 33,886 Net assets attributable to shareholders 1,730,893 1,730,893 1,489,460 1,489,460 CASH FLOW STATEMENT For the six months ended Net cash inflow from operating activities 14,353 13,141 51,578 52,682 Servicing of finance Interest received Distributions paid (34,454) (34,454) (30,492) (30,492) Total cash outflow from servicing of finance (34,345) (34,354) (30,271) (30,287) Financial investments Purchases of investments (91,954) (118,902) (199,119) (204,851) Sales of investments 51,133 51,133 27,862 27,862 Capital expenditure (12,863) (9,281) (14,793) (10,423) Total cash inflow from financial investments (57,384) (77,050) (186,050) (187,412) Financing Amounts received on issue of shares 136, ,392 98,319 98,319 Total cash inflow from financing 136, ,392 98,319 98,319 Increase in cash in the period 59,017 38,129 (66,424) (66,699) Net cash at the start of the period 80,898 73, , ,245 Net cash at the end of the period 139, ,676 80,898 73,546

6 5 Schroder UK Property Interim Unaudited Financial Statements NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED) Accounting policies Basis of accounting The accounts have been prepared under the historical cost basis, as modified by the revaluation of investments, and in accordance with the Statement of Recommended Practice for Authorised s issued by the IMA in October The accounting policies applied are consistent with those of the annual accounts for the period ended and are described in those annual accounts.

7 Schroder UK Property Interim Unaudited Financial Statements 6 UNAUDITED GENERAL INFORMATION Reports & Accounts This document is a short report for the Schroder UK Property for the period to. Further information about the activities and performance of the during this period can be found within the Quarterly Investor Reports on the Schroder UK Property website: Manager Contacts For general information and queries on secondary market availability, please contact: Olivia Pember Product Manager olivia.pember@schroders.com +44 (0) James Lass Manager james.lass@schroders.com +44 (0)

8 S C H R O D E R U K P R O P E R T Y F U N D Issued in July 2013 by Schroder Investment Management Limited, 31 Gresham Street, London EC2V 7QA which is authorised and regulated by the Financial Conduct Authority. w46337