Raven Russia (RUS) may be starting to turn the corner after a difficult few years of trading. Specialising in leasing warehouse space mainly around Moscow, the group hit a bad patch when falling oil prices hammered the Russian rouble at a time when tenants were obliged to pay rent in dollars.
Thankfully, the business model has been adapted towards collecting rent in roubles, and trading has been improved by the rouble's appreciation against the dollar. Rouble rents now account for just under a quarter of Rouble denominated rental income. A total of £109m was raised in July through the issue of preference shares, which was used to reduce debt. And following this financial restructuring - which included negotiating a lease from $31m of loans for a $16m payment - the group accumulated nearly $200m in cash, and since the year-end $83m of this has been used to buy three properties in St Petersburg at an initial yield of over 16 per cent, which will generate annual income of $13m.
As well as paying 3.2p per share on the preference shares, ordinary shareholders will be paid a final dividend by way of a tender buy-back of 1 in 26 shares at 52p a share, equivalent to 2p a share which, with an interim payment equates to a full-year payout of 2.5p a share.
IBES consensus forecasts are for adjusted EPS of 0.085¢ for 2017, falling to 0.055¢ in 2018.
| RAVEN RUSSIA (RUS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 50p | MARKET VALUE: | £334m | |
| TOUCH: | 50-51.5p | 12-MONTH HIGH: | 52p | LOW: 28p |
| DIVIDEND YIELD: | 5% | DEVELOPMENT PROPERTIES: | $41m | |
| DISCOUNT TO NAV: | 16% | NET DEBT: | 108% | |
| INVESTMENT PROP: | $1.3bn | |||
| Year to 31 Dec | Net asset value (¢) | Pre-tax profit (m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 122 | 63 | 5.2 | 3.75 |
| 2013 | 122 | 28 | -0.7 | 5 |
| 2014 | 101 | -98 | -12.3 | 6 |
| 2015 | 72 | -205 | -28.8 | 2 |
| 2016 | 76 | 22 | 1.17 | 2.5 |
| % change | +6 | - | - | +25 |
Ex-div: See text Payment: - £1=$1.22 | ||||
