10 Hammersmith Grove, West London. Development Securities PLC

Transcription

1 10 Hammersmith Grove, West London Development Securities PLC Preliminary results for year ended 28th February 2013

2 Contents Slide number Overview and highlights 3 8 Financial results 9 13 Operating review - Overview - Legacy assets - Development and trading portfolio - Investment portfolio - Major development portfolio Appendix

3 OVERVIEW AND HIGHLIGHTS

4 Headline numbers EPRA Non-EPRA Year ended 28th February months ended 29th February 2012 Year ended 28th February months ended 29th February 2012 Net Asset Value ( m) Net Asset Value per share (pence) Earnings/(loss) per share (pence) 10.5 (8.2) 2.0 (10.3) Development and trading profits (current portfolio) ( m)

5 Group highlights Profit after tax of 2.3 million (14-month period to 29th February 2012: loss of 12.0 million) EPRA NAV of million equivalent to 260 pence per share reduced by 0.9 per cent from million (262 pence per share) as at 29th February 2012 after deduction of 6.8 million of dividends Basic NAV of million reduced from million by 6.5 million (2.1 per cent) effectively equivalent to the dividend of 6.8 million paid in the year Increased gains of 28.1 million delivered from current development and trading portfolio (29th February 2012: 8.6 million) Decline of 12.8 million (4.7 per cent) in investment portfolio (including our share of JV assets) compares against 12-month UK IPD Monthly Index decline of 6.0 per cent (excluding Central London) Final dividend of 2.4 pence per share declared. Total dividend for the year at 4.8 pence per share, equivalent to that paid in prior years 96.8 million of bank acquisition finance for new deals (including JVs) secured from HSBC, RBS and Santander Balance sheet strength maintained balance sheet gearing reduced to 47.9 per cent (2012: 48.8 per cent). Gearing including share of JVs at 63.9 per cent (2012: 58.9 per cent) 5

6 Operational highlights Development and trading gains of 28.1 million delivered as anticipated: Above target IRRs achieved average of 33 per cent on completed deals Good visibility on further gains across the portfolio over the next few years 188 million net proceeds of 2009/2010 equity raises now fully invested. Since 2009, 16.7 million of dividends returned to Shareholders. Two real estate loan portfolios acquired totalling 143 million significant value-enhancing deals Disposals achieved in the year to realise gains from a significant element of the underlying real estate assets Planning consent for change of use (the significant driver to asset value enhancement) secured on nine assets including: Cross Quarter, Abbey Wood, London Resolution to Grant Planning for ten-acre, 85 million foodstore anchored redevelopment The Old Vinyl Factory, Hayes Planning consent for 250 million, 18-acre mixed-use regeneration scheme Project within major developments portfolio progressing well: 10 Hammersmith Grove on track for practical completion in Q with strong letting interest Preparations in hand for further prime office developments of 170,000 sq. ft. at 12 Hammersmith Grove and sq. ft. at 4 Kingdom Street, PaddingtonCentral Progress made to release approaching 40 million cash from legacy assets Broughton residential land sold 6

7 Strong trading gains delivered and more to follow Current expectations of gains to be released across portfolio Realised gains ( 'm) Expected gains ( 'm) FY 2012 FY 2013 FY 2014 FY 2015 FY

8 Strong pipeline of disposals established FY 2014 FY 2015 FY DEVELOPMENT AND TRADING PORTFOLIO Hale Barns Marsh Mills East London Barnstable Beyond Green - Norwich Beyond Green - Pincents Hill, Tilehurst Launceston Luneside East Sandbanks Tranmere - HDD Lawley - HDD Buckshaw - HDD Newport - HDD Llanelli - HDD HDD - other Abbey Wood 399 Edgware Road Collingwood/Dartmouth Rock Portfolio Rembrandt House, Watford Woking Scotland Wind Farms Shepherds Bush The MVMNT, Greenwich Kensington Church Street Real estate loan portfolios The Old Vinyl Factory, Hayes Morden Wharf Axis, Manchester FY 2014 FY 2015 FY 2016 MAJOR DEVELOPMENTS PORTFOLIO Cambridge Science Park 12 Hammersmith Grove 10 Hammersmith Grove PaddingtonCentral 4&5 KS Southwark INVESTMENT PORTFOLIO Atlantic Park Manchester Arena 8

9 FINANCIAL RESULTS

10 Results for the year ended 28th February 2013 Year ended 28th Feb 2013 m 14-month period ended 29th Feb 2012 m Profit before revaluations, exceptional impairment, interest & taxation Net finance costs (9.2) (10.1) Gain/(loss) before revaluations and taxation 14.6 (2.5) Exceptional impairment - (2.8) Swap mark-to-market valuations (0.9) (0.5) Property revaluation (loss)/gains (including joint ventures) (12.9) (4.3) Profit/(Loss) before tax 0.8 (10.1) Profit/(Loss) per share 2.0p (10.3)p Dividend per share 4.8p 5.6p 10

11 Contribution to NAV change Net assets attributable to Shareholders at 29th February m Cash-related in the year m Non cash-related in the year m Contribution from investment property Property revaluations (12.9) (12.9) Contribution from development and trading portfolio Write down of balance sheet legacy assets (2.2) (2.2) Operating costs (13.0) (13.0) Net interest costs (9.2) (9.2) Swap revaluations (1.9) (1.9) Other (1.0) (1.0) Taxation Dividends and share purchases (7.0) (7.0) Sub-total (4.7) 12.3 (17.0) Net assets attributable to Shareholders at 28th Feb

12 Pence per share Change in NAV per share through the period 12

13 Net Debt 28th Feb 2013 m 29th Feb 2012 Gross debt Cash (59.2) (50.2) Net debt Gearing 47.9% 48.8% Share of net debt in joint ventures Net debt including joint ventures Gearing including joint ventures 63.9% 58.9% m Analysis of gross debt Fixed rate 48.0% 49.4% Capped / SWAP 42.1% 44.7% Floating rate 9.9% 5.9% Weighted average interest rate 5.9% 6.0% Weighted average maturity 8.3 years 9.4 years 13

14 OPERATING REVIEW 1) Overview 2) Legacy assets 3) Development and trading portfolio 4) Major development portfolio 5) Investment portfolio

15 1) Overview the three aspects of our portfolio Proceeds of equity raise principally invested into these assets Strong pipeline of valueenhancing deals developed Development and trading portfolio Objective To create value through the regeneration of redundant or undervalued real estate, creating a product that can be sold into the prime or near-prime market Real estate loan portfolios Objective To realise gains through the acquisition of loan portfolios secured against underlying real estate assets, from banks and financial services providers Major developments portfolio Objective To deliver prime developments that achieve maximum returns with reduced risk exposure Investment portfolio Objective To sustain and grow a stable income stream from higher yielding investment assets with enhancement potential Typically late cycle activity portfolio is selective at present Investment portfolio held for consistent cash yield and to support overheads 15

16 Our focus - delivering gains by regenerating real estate Applying equity in a capital constrained environment, our equity resource commands a powerful position in the market and terms of trade move towards us Arbitrage opportunities - transformation of secondary real estate into prime/near-prime product to capture value uplift and deliver strong returns. This can be achieved by: Repositioning redundant/functionally obsolete real estate into sectors of demand through change of use and/or redevelopment Acquisition of real estate loans or portfolios from financial institutions which can be sold individually with or without adding value through the development process Risk diversification acquisition of assets across multiple sectors and locations where demand is in evidence achieving risk diversification as opposed to concentration of value in a few individual assets target IRRs of 20 per cent and above Reinvestment of gains - equity released from disposals of assets is recycled into further arbitrage opportunities with consideration given to special dividends to Shareholders subject to market conditions and Board approval 16

17 2) Legacy assets progress made to release cash c. 40 million cash to be released from legacy assets Broughton, Flintshire Planning consent granted by Welsh Assembly Government for 19-acre residential development in Broughton, Flintshire Contracts exchanged in April 2013 for sale to a housebuilder at 11.4 million (book value) 399 Edgware Road, London NW9 Planning application submitted for a foodstore anchored mixed-use scheme on seven-acre development site. Planning outcome in Summer 2013 Pre-let agreed with Morrisons (subject to planning) for 80,000 sq. ft. foodstore to anchor the scheme 125 million redevelopment to also include 183 residential units, 54,000 sq. ft. of additional retail space and 580 car parking spaces 17

18 3) Development and trading portfolio - overview Development and trading portfolio is held at the lower of cost or net realisable value Development and trading portfolio Real estate loan portfolios Objectives To create value through the regeneration of redundant or undervalued real estate, creating product that can be sold into the prime or near-prime market. Strategy Identify strong buying opportunities: Often distressed sellers with no access to finance so terms of trade move in our favour Ultimate demand for the regenerated property is strong Capital gains can be captured through exploiting the yield arbitrage Maximise value and growth through planning gains, proactive asset management and development Target project life cycles of three to four years and IRRs in excess of 20 per cent Diversify financial risk limited equity deployed in each project - 10 million maximum, 5 million average Objectives To realise gains through the acquisition of property loan portfolios from banks and financial institutions. Strategy Acquire real estate loan portfolios with opportunities for value enhancement e.g. through selective redevelopment or repositioning of the underlying real estate assets Dispose of the underlying real estate collateral to repay the loans 18

19 Strong progress made during the year Momentum building in delivery of gains Gains from disposals of development and trading assets improved further Rock portfolio further sales of assets generating cumulative profits to date of 8.1 million, an IRR of 40.9% Westminster Palace Gardens final elements sold, cumulative profits of 4.3 million, an IRR of 31.1% Wick Site, Littlehampton completion of sale of site to Morrisons, cumulative total profits of 3.5 million realised, an IRR of 27.2% The MVMNT, Greenwich disposal of student accommodation and residential land elements gains to DS of 1.3 million Acquisitions of 143 million of real estate loan portfolios Underlying real estate to be repositioned and sold into sectors of demand and the loans repaid to generate strong gains a significant element of the portfolios disposed to date Positive planning progress achieved creating value through change of use Cross Quarter, Abbey Wood, London Resolution to Grant Planning secured for an 85 million foodstore anchored development. Pre-let secured with Sainsbury s for an 81,000 sq. ft. foodstore The Old Vinyl Factory. Hayes Planning consent secured for a 250 million, 1.5 million sq. ft. mixed-use scheme 19

20 Development and trading portfolio contribution Year ended 28 th Feb months ended 29 th Feb 2012 million million Rock portfolio Wick Site, Littlehampton Westminster Palace Gardens, London Project Management Fees/Net Rental Income Gains arising from additional trading asset realisations Other Gross contribution

21 CHROME PORTFOLIO 103 million real estate loan portfolio acquired in JV with Pears Group Portfolio comprises 65 per cent Central London residential assets A significant element of the underlying real estate assets now sold Majority of the remainder to be sold or repositioned through change of use by the end of FY 2014 Featured property, Acre House, Covent Garden ground floor retail units sold, 8 out of 11 residential units sold 21

22 THE MVMNT, GREENWICH, LONDON 2.2 acre site acquired in September 2010 in JV with Cathedral Group Planning consent secured in April 2011 for 350,000 sq. ft. mixed-use regeneration scheme Sale of first two phases now complete gains of 1.3 million Practical completion of remaining plots anticipated in Q

23 CROSS QUARTER, ABBEY WOOD, LONDON Acquired in May 2011 from eceivers acting on behalf of Lloyds Banking Group 3.7 acre site acquired and joint venture formed with adjoining land owner to create a 10-acre site for redevelopment 81,000 sq. ft. anchor foodstore pre-let to Sainsbury s in July 2011 Resolution to Grant Planning secured in April 2013 for 85 million mixed-use redevelopment Adjacent to future South East terminus of Crossrail Pre-let now being marketed for funding 23

24 KENSINGTON CHURCH STREET, LONDON Acquired in June 2011 in JV with Brockton Capital (DS share of partnership is 25 per cent) One-acre site comprising 14-storey office block, 13 retail units and a surface car park Currently undertaking pre-application meetings with Kensington & Chelsea regarding a comprehensive mixed-use redevelopment Planning application to be submitted later this year 24

25 4) Major developments portfolio overview/highlights Objectives To deliver prime developments that achieve maximum returns with reduced risk exposure Strategy Target locations where supply of prime product is limited and occupier demand is strong Apply our expertise in development and planning to take sites from land assembly and acquisition to scheme completion and full occupancy Mitigate development risk by achieving institutional forward-funding/pre-lets do not develop on our own balance sheet Earn project management fees through the development process and a profit participation once project is complete Highlights 10 Hammersmith Grove practical completion expected in Q strong letting interest in majority of space Cambridge Science Park Appointed development manager in April 2012 by Trinity Hall College for three new office/lab buildings totalling 145,000 sq. ft. Good letting interest from within resilient biotech market Two Kingdom Street, PaddingtonCentral - 26,000 sq. ft. let to Statoil on a 15-year lease. 50,000 sq. ft. remains to be let within this 265,000 sq. ft. prime office building 25

26 10 HAMMERSMITH GROVE 110,000 sq. ft. prime office building forward-funded on a speculative basis by SWIPPT for 50 million first phase of 275,000 sq. ft. office development. Practical completion expected Q Strong letting interest in majority of space Plans progressing for second phase 12 Hammersmith Grove 26

27 5) Investment portfolio overview Objectives To sustain and grow a stable income stream from higher yielding investment assets with enhancement potential Strategy Target assets with core defensive income and enhancement potential in sectors where occupier demand is robust and supply of accommodation restricted Drive income growth through proactive asset management Portfolio 27 assets including: Direct investment portfolio - 25 assets Joint venture investment assets - Manchester Arena Complex and Wick Lane Wharf, London 27

28 Investment portfolio highlights Negative valuation movements of 12.8 million (4.7 per cent decline) including our share of joint venture investment assets 4.7 per cent decline in value of our portfolio which contains no Central London assets compares against: 4.2 per cent decline in 12-month IPD Monthly Index including Central London 6.0 per cent decline in 12-month IPD Monthly Index excluding Central London Contracted rent increased to 15.5 million from 14.9 million as at 29th February 2012 Void rates decreased to 9.7 per cent compared to 11.4 per cent at 29th February 2012 Majority of valuation declines driven by yield shifts Only one significant tenant administration HMV Top 5 Occupiers as at 28 th February 2013 Annual rent m % of contracted rent 1 Waitrose % 2 Primark Stores Limited % 3 Sports World % 4 Martin McColl Ltd % 5 Brausch & Co % 28

29 Direct investment portfolio overview Tenant profile Location profile PLC/Nationals 63% Local Traders 20% Regional Multiples 13% FTSE 100 3% Government 1% South East 47% South West 17% North 12% London 11% Wales 9% Midlands 4% Lease profile Analysis by sector 0-5 years 35% 5-10 years 38% years 11% years+ 7% 20 years+ 9% Retail 79% Industrial 10% Mixed 6% Office 4% Residential 1% 29

30 Direct investment portfolio overview cont Year ended 28th Feb month period ended 29th Feb 2012 Portfolio value 220.1m 237.9m Number of assets Contracted rent 15.5m 14.9m Valuation yield 7.5% 6.7% Equivalent yield 7.9% 7.5% Voids 9.7% 11.4% 30

31 Investment property portfolio contribution (includes share of JVs) Year ended 28th Feb 2013 m 14-month period ended 29th Feb 2012 m Revenue Direct costs (4.0) (3.7) Gains on disposals Asset management fees and joint venture net income (0.2) 1.3 Contribution prior to revaluation Revaluation (loss)/gain - Direct - Share of JV (16.3) 3.5 (4.7) 0.5 Contribution

32 Investment portfolio analysis core investment portfolio* Sector Capital value % of portfolio by capital value Void rates Net initial yield Weighted average lease length London/SE weighting Valuation movement Foodstore anchored 63.3 million 32.8% 7.9% 5.7% 10.3 years 32.8% (0.4)% Foodstore anchored (outside DS ownership) 38.9 million 20.2% 16.4% 9.0% 4.8 years 5.5% (12.3)% Other Retail 46.8 million 24.2% 3.8% 7.7% 8.8 years 9.0% (9.7)% Commercial 21.0 million 10.8% 9.5% 9.4% 7.3 years 6.8% (0.8)% Mixed-use 23.1 million 12.0% 8.6% 7.8% 11.0 years 2.1% (4.4)% Total million 100.0% 9.7% 7.5% 8.6 years 56.1% (5.7)% *Analysis covers core investment assets direct investment portfolio excluding developable land and site assembly 32

33 Valuation change by asset Atlantic Village, Bideford 2.5 Capital value change m (5.4) (1.6) (4.5) Queen Street, Cardiff (1.7) (0.5) (2.2) Cambrian Way, Carmarthen (0.7) (0.2) (0.3) Attributing factor - Lettings - Yield shifts of between 200 and 800 bps - Voids/administration - Yield shift - Tenant administration - Yield shift - Regear - Voids Asset management initiatives Plans to extend Marks and Spencer underway to drive additional footfall For asset enhancement initiatives see slides Re-let vacant unit for which there is strong interest. Renew outstanding lease expiry Re-let vacant units. 0ne unit let since year end adding 20,000 to income (1.2) Crown Glass Shopping Centra, Nailsea 0.6 (0.4) (1.3) (0.1) New lettings - Lease incentives/cap ex - Yield shift - Voids - Revaluation on part of scheme Continue tenant improvement programme. Let refurbished offices which are all now under offer. Several lease renewals completed since year end giving greater trading continuity. Sell additional land holdings (1.1) High Street, Bexleyheath (0.8) - Yield shift of 32 bps (0.8) Port Talbot (0.5) - Yield shift of 125 bps (0.5) Re-structure leases with 2 occupiers to improve income security. Explore potential of combining with adjacent owner to increase lot size. 33

34 Valuation change by asset cont Pearl Assurance House, Nottingham (1.4) Capital value change m (0.1) (0.3) 0.3 (1.5) Colston Tower, Bristol (0.7) 0.8 (0.5) (0.6) (1.0) Valuation movement on assets (12.8) Attributing factor - HMV administration void - 0.5% yield shift - Lease incentives/cap ex - New lettings - Yield shift - Regears and lettings - Voids - Lease incentives/cap ex million of movement due to yield shift Asset management initiatives Re-let HMV unit as rent/void package is competitive Continue rolling refurbishment programme to improve occupancy rates and psf achieved. Explore potential to improve the retail/a3 offer million decline in above assets represents 79% per cent of total 16.3 million decline in direct investment portfolio 34

35 Atlantic Village future plans Atlantic Village is a 110,000 sq. ft. outlet scheme in North Devon anchored by ASDA (not in DS ownership). Key tenants include Marks and Spencer, Nike, Gap. 85 per cent let, mostly turnover rent. Initiatives for asset management and enhancement include: Existing scheme Phase 1 Discussions in hand with Marks and Spencer for significant extension to increase footfall, turnover and drive new lettings. Introduce convenience and A3 retailers to improve frequency of visits and customer spend. Existing scheme Phase 2 Planning permission has been granted for an extension to the existing scheme of 55,050 sq. ft. (plus up to 85 per cent trading mezzanine 101,000 sq. ft. total ). This will also increase car parking provision from 700 to over 1000 spaces. The total centre, postextension, would be 245,000 sq. ft. Marketing for pre-lets underway. Atlantic Park This 20-acre site is on the opposite side of the A39 to Atlantic Village. We have submitted a planning application for a drive-thru restaurant and hotel/pub capital receipts from which will fund infrastructure. The remainder of the site is suitable for mixed-use development. We also have a further 22 acres under option. Masterplan in hand at adjoining location for 3,500 homes. 35

36 Atlantic Village cont. Red line drawing shows proposed extension to Atlantic Village 36

37 Appendix

38 Executive team Michael Marx Chief Executive Marcus Shepherd Finance Director Julian Barwick Executive Director (Development) Matthew Weiner Executive Director (Investment) 38

39 Five core principles The following principles, consistently followed over 15 years, underpin our strategy and our approach to risk-management: 1. We target modest levels of gearing (c.50% 60%) 2. We do not undertake major developments on our Balance Sheet and minimise exposure through forward-funding/pre-lets We consider large-scale development projects to be generally a late economic cycle activity driven by an expanding economy and strengthening demand. We have never believed it appropriate for a company of our size to accept sole development risk in relation to our substantial development projects and consequently, we share the majority of development project risk with financial institutions and partners who are the more appropriate long-term investors. 3. We focus primarily on commercial property We maintain a predominant focus on securing planning consents and redeveloping commercial property although the emphasis of our activities may shift between major, complex developments and smaller scale development and trading properties at the different stages of the property cycle. Since July 2009, we have broadened the scope of our real estate activities to include mixed-use projects that include residential, hotel and student accommodation. 4. We maintain an active investment portfolio whereby rents cover operational expenses Our investment portfolio provides a steady and predictable flow of funds, contributing significantly towards central overheads and mitigating the more uneven profits and cash flow arising from the major development and trading portfolio. The investment portfolio accounts for a significant element of invested equity and represents a diverse portfolio of assets across the UK, comprising carefully selected retail and office properties. 5. We only invest in UK property Page 39

40 Progress to date since equity raises The 188 million proceeds of our two equity raises are now fully invested and have allowed us to build up a pipeline of over 40 investment and development assets 16.7 million of dividends paid to Shareholders since 2009 Since 2009, we have crystallised 36.7 million of profit in line with expectations Planning consent has been achieved on 28 real estate assets since 2011 Success of strategy continuing to emerge Page 40

41 Market context Continued macro economy uncertainty holding back GDP growth Continued uncertainty surrounding the Eurozone Debt burden remains high new bank lending to real estate sector still highly constrained Outside of prime markets, real estate rental and capital growth is weak GDP growth is negligible and likely to remain so for the medium-term Interest rates at their lowest no further yield compression to sustain property values Occupier and consumer demand remains weak, limiting prospects for rental growth Yield gap between prime and secondary property widens further Secondary market downward spiral is flushing out weak holders to reach clearance prices Strong holders are not sellers in such a market decline Real estate operators need to apply their expertise to drive capital growth Page 41

42 Market context key graphs Initial Yield (%) Lending to Commercial Property Arbitrage opportunities still strong Net new lending negative for 8 consecutive quarters Spread, %-points (RHS) IPD low yield/prime, % (LHS) IPD high yield/secondary, % (LHS) Source: Capital Economics Lending to property as a % of total loan book (LHS) 12 Net new lending to property, bn (RHS) Source: Capital Economics All-property initial yield minus FTSE All Share dividend yield All-property initial yield minus 10 year gilt yield Real estate market fairly priced Real estate market fairly priced CE forecast 6 5 CE forecast Property looks expensive Property looks expensive IPD all property initial yields less FTSE All-Share dividend yield, % 1-6 IPD all property initial yields less yields on 10-year gilts, % Source: Capital Economics Source: Capital Economics Page 42

43 UK property IPD returns Annualised av. return Capital: 2.3% Income: 6.5% Page 43

44 Operating costs Costs are trending at 3 per cent per annum since 2007/8 notwithstanding a 90% increase in net worth and a 60% increase in gross assets since 2008 Furthermore, risk diversification reflected in 40 development and trading deals, significantly more than in 2007/8 (12 mth adj) Year End Total overheads ( 000) 11,396 13,394 12,844 12,906 12,843 13,012 3% ( 000) 11,738 12,090 12,453 12,826 13,211 Page 44

45 Pipeline of residential developments during 2012/13 Scheme Name Number of Units Estimated end value Constructed / Completed Wick Lane Wharf, London Sandbanks Road, Dorset 5 The Collection, Lawley Village 12 Hebble Wharf, Wakefield 22 Westminster Palace Gardens* 23 Neo Bankside* 5 Under Construction The MVMNT, Greenwich* 181 Nokoto Court, Bridgwater 16 The Collection (Duplexes/Townhouses), Lawley Village 27 Wallis Court, Buckshaw Village 30 Planning Permission Granted Broughton* 280 Cross Quarter, Abbey Wood 216 Rembrandt House,Watford 107 Shepherds Bush Market 212 The Old Vinyl Factory,Hayes 685 Hale Barns 24 Planning Permission Submitted / Pending 399 Edgware Road 183 Anchorwood Bank, Barnstaple 350 Launceston 275 Design Phase Valentines House, Ilford 110 Morden Wharf, Greenwich 700 Chorlton cum Hardy 24 TOTAL 3594 c. 1.2 billion *Residential sales achieved Page 45

46 Disclaimer This presentation has been prepared by Development Securities PLC (the Company ). No representation or warranty (express or implied) of any nature is given nor is any responsibility or liability of any kind accepted by the Company or any of its directors, officers, employees, advisers, representatives or other agents, with respect to the truthfulness, completeness or accuracy of any information, projection, representation or warranty (expressed or implied), omissions, errors or misstatements in this presentation, or any other written or oral statement provided. In particular, no responsibility or liability is or will be accepted and no representation or warranty is or is authorised to be given as to the accuracy, reliability or reasonableness of any forward-looking statement, including any future projections, management targets, estimates or assessments of future prospects contained in this presentation, or of any assumption or estimate on the basis of which they have been given (which may be subject to significant business, economic or competitive uncertainties and contingencies beyond the control of the management of the Company). Any such forward-looking statements have not been independently audited, examined or otherwise reviewed or verified. All views expressed in this presentation are based on financial, economic, market and other conditions prevailing as of the date of this presentation. The Company does not undertake to provide access to any additional information or to update any future projections, management targets, estimates or assessment of future prospects or any other forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation, or to correct any inaccuracies in this presentation which may become apparent. Past performance is not indicative of future results and forward-looking statements are not guarantees of future performance. This presentation is for information purposes only and does not constitute an offering document or an offer of transferable securities to the public in the UK. This presentation is not intended to provide the basis for any credit or other evaluation of any securities of the Company and should not be considered as a recommendation that any investor should subscribe for, dispose of or purchase any such securities or enter into any other transaction with the Company or any other person. The merits and suitability of any investment action in relation to securities should be considered carefully and involve, among other things, an assessment of the legal, tax, accounting, regulatory, financial, credit and other related aspects of such securities. This presentation is being communicated or distributed within the UK only to persons to whom it may lawfully be communicated, and has not been approved for the purposes of section 21 of the Financial Services and Markets Act It may not be reproduced (in whole or in part), distributed or transmitted to any other person without the prior written consent of the Company. In particular this presentation is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Any recipients of this presentation outside the UK should inform themselves of and observe any applicable legal or regulatory requirements in their jurisdiction, and are treated as having represented that they are able to receive this presentation without contravention of any law or regulation in the jurisdiction in which they reside or conduct business. 46