This article is from the Australian Property Journal archive
AFTER a year restructure Trinity has restored some stability to its balance sheet and expects to make a full year loss in the range of $50 to $59 million for FY2010, compared to a $226 million loss in the previous year.
Trinity also estimates the group’s Net Tangible Assets as at June 30 2010 will be in the range of 17 cents to 20 cents per security. This compares to an NTA per security of 22 cents at December 31 2009.
Chairman Brett Heading said the board was encouraged that property valuations appeared to have stabilised and that it believes its prudent management of a complex situation over the last year had helped restore a degree of stability to the balance sheet which is reflected in the NTA.
Heading said Trinity has complied with its June 30 2010 banking covenants for its debt facilities with National Australia Bank which expire on October 31 2011. The next test of banking covenants is at September 30 2010 when Trinity is required to have a loan to value ratio of 60% and interest cover of 1.5 times.
“Trinity has commenced discussions with NAB regarding the extension of its existing facilities including a new range of covenants.
“Trinity also advises that it is continuing discussions with the financier of its residential property asset in Tokyo regarding the refinance of the facility which expires on July 31 2010,” he added.
Factors that have contributed to the reduction in the NTA since December 31 2009:
|
Description |
NTA Movement per security (cents) |
|
Loss on sale of direct property assets |
(0.8) |
|
Loss on sale of investments and co-investments |
(0.8) |
|
Impairment of investments and co-investments |
(1.8) |
|
Revaluation of Japanese assets |
(1.4) |
|
Amortisation of borrowing costs relating to debt facilities repaid |
(0.7) |
|
Reclassification of Goodwill to tangible investment through 50% sale of Trinity Funds Management Limited |
4.1 |
Heading said some property assets are financed by limited recourse debt and, while there is no current intention to sell those assets.
However he added that if they were sold for current book values, the group’s NTA would improve by an estimated 7c per security.
Meanwhile Heading said the board is considering implementing an orderly sales campaign from next month.
And Trinity’s sale of Mulgrave Business Park (50% owned by Trinity Stapled Trust) and Centrepoint Arcade, Innisfail (also owned by Trinity Stapled Trust) have now settled with proceeds being applied to reduce NAB debt.
Australian Property Journal
