Announcement
CORPACT: KPG: COVID-19 Business update
08:31am
KPG
06/04/2020 08:31
CORPACT
PRICE SENSITIVE
REL: 0831 HRS Kiwi Property Group Limited
CORPACT: KPG: COVID-19 Business update
In light of the ongoing disruption caused by the COVID-19 pandemic, Kiwi
Property has provided the following business update:
During this time of unprecedented challenge, Kiwi Property is focused on
ensuring the wellbeing of its people, tenants and customers, and protecting
the long-term value of the company for investors.
Financial position
As announced last week, the business successfully extended $361 million of
bank debt facilities on three and five year terms, increasing the weighted
average term of all debt facilities to 3.9 years. Kiwi Property now has no
bank debt maturities until the 2023 financial year, $303 million in undrawn
credit and a healthy overall gearing position of 29.2%.
Property portfolio
Kiwi Property has a diversified property portfolio, comprised of mixed-use,
office, retail and other use types. The company's assets are heavily weighted
to the golden triangle, which is home to 50% of New Zealand's population,
with 71% of assets located in Auckland and a further 8% in Hamilton. Kiwi
Property has maintained high occupancy of 99.4% and a weighted average lease
expiry of 5.1 years [NOTE 1].
Cost-savings programme
Kiwi Property has implemented a comprehensive cost savings programme to
reduce expenses and help offset any decline in income resulting from measures
to control the pandemic. Effective immediately, non-essential capital
expenditure projects have been put on hold until there is greater clarity
about the future trading environment. All operating expenditure has been
reviewed and discretionary spend will be stopped where possible. The Board of
Directors, Chief Executive Officer and Executive Team have agreed to a 20
percent reduction in pay, while in parallel, employee salary increases have
also been frozen. These measures will be reviewed on an ongoing basis as the
COVID-19 situation evolves.
FY20 performance guidance & final dividend
While Kiwi Property's operating performance was in-line with expectations
prior to COVID-19, it is clear the pandemic will have a material impact on
the company's forward-looking performance and rental receipts. It is too
early to quantify the impact of the ongoing period of disruption on future
income, asset values and cash flows. Kiwi Property will continue to closely
monitor the developing situation and update the market as appropriate.
Given the inherent uncertainty surrounding COVID-19's duration, the Board has
adopted a prudent approach to capital management and made the difficult
decision not to proceed with the final dividend for the year ended 31 March
2020.
> Ends
NOTES:
1. Source: Kiwi Property interim report 2020.
Contact us for further information.
Clive Mackenzie
Chief Executive Officer
clive.mackenzie@kp.co.nz
Mark Ford
Chair
mvford@bigpond.net.au
Campbell Hodgetts
Communications Lead
campbell.hodgetts@kp.co.nz
0275634985
About us
Kiwi Property (NZX: KPG) is one of the largest listed property companies on
the New Zealand Stock Exchange and is a member of the S&P/NZX 20 Index.
We've been around for over 25 years and we proudly own and manage a
significant portfolio of real estate assets, comprising some of New Zealand's
best mixed-use, retail and office buildings. Our objective is to provide
investors with a reliable investment in New Zealand property through the
ownership and active management of a diversified, high-quality portfolio. S&P
Global Ratings has assigned Kiwi Property a corporate credit rating of BBB
(stable) and an issue credit rating of BBB+ for each of its fixed rate senior
secured bonds. Kiwi Property is the highest rated New Zealand company within
CDP (Carbon Disclosure Project) and is a member of FTSE4 Good, a series of
benchmarks and tradeable indices for ESG (Environmental, Social and
Governance) investors. Kiwi Property is licensed under the Real Estate Agents
Act 2008. To find out more, visit our website kp.co.nz
End CA:00351283 For:KPG Type:CORPACT Time:2020-04-06 08:31:35
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