diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_1.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_1.txt new file mode 100644 index 0000000000000000000000000000000000000000..7a41a0fb25d7d7f46ce40f60d0fdf42462ec7b97 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_1.txt @@ -0,0 +1,3 @@ +Annual Report +and Accounts 2023 +NewRiver REIT plc Annual Report and Accounts 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_10.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_10.txt new file mode 100644 index 0000000000000000000000000000000000000000..7cfa613b31ed10ccaafe6c2ec202f662c5c98720 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_10.txt @@ -0,0 +1,85 @@ +Resilient performance +and strategic progress +“We are confident of +our ability to deliver our +medium term objective of +a consistent premium total +accounting return.” +Allan Lockhart +Chief Executive +Our strong operational performance, including disposals within our +Work Out portfolio, resulted in excellent cash generation as we ended +the financial year with £111.3 million of cash up from £88.2 million at the +end of FY22. +Whilst the MSCI All Property and All Retail indices experienced capital +returns of -16% and -13% respectively for the year 1 April 2022 to +31 March 2023, our portfolio outperformed with a like-for-like valuation +movement of -5.9%. The majority of our reported decline was +contained within our Regeneration portfolio, predominantly driven +by higher estimated development costs, a direct consequence of +persistent high inflation. As a result, our EPRA Net Tangible Assets +(NTA) per share at the full year was 121 pence (FY22: 134 pence). +At our FY22 results, we said that we would seek to maintain +headroom to our Loan To Value (LTV) guidance of <40% given the +macro-economic uncertainty at that time. That was the right decision +given the significant disruption in the real estate capital markets +especially in the final quarter of 2022. Our LTV at the full year was +33.9% (FY22: 34.1%), well within our guidance. Importantly, we have +no refinancing or exposure to higher interest rates on drawn debt until +2028 and we view this, together with the significant spread between +our portfolio net initial yield of 8.0% and our cost of borrowing of 3.5%, +as key strengths. +A key highlight of the full year was successfully expanding our Capital +Partnerships strategy by securing a high-quality mandate from M&G +Real Estate to asset manage a large retail portfolio comprising 16 retail +parks and one shopping centre, further extended to include a second +shopping centre post year end. This is a great endorsement of the +quality of our asset management platform and also demonstrates the +potential to grow our recurring earnings in a capital light way. +Our operating and financial results demonstrate the underlying resilience +of our business in what has been a challenging year for the real estate +sector. That, together with our strong financial position and the strategic +options available to us, means we remain confident in delivering our +objective of a consistent 10% total accounting return for our shareholders. +FINANCIALS +Strong Financial Performance +& Fully Covered Dividend +Our Retail UFFO increased by 26% in FY23 to £25.8 million +(FY22: £20.5 million). This performance has been driven by an increase +in our Net Property Income, up 5.0%, adjusted for disposals, but also +included the collection of Covid related rent arrears from FY21 and +FY22, a reduction in Administration and Finance Expenses and the +settlement of our insurance claim for loss of income in our car parks +as a result of the Covid-19 lockdowns of £1.4 million. +In line with our dividend policy, we have declared a final dividend of 3.2 +pence per share bringing the total dividend for FY23 to 6.7 pence per +share, which is 125% covered by UFFO. +As a result of an improving Retail UFFO, a tight control on capital +expenditure and completed Work Out disposals, our cash position +increased from £88.2 million in March 2022 to £111.3 million in March +2023. One of the benefits of rising interest rates, is that we are now +receiving a return on our excess cash which is accretive to our UFFO. +Valuation Outperformance +Our portfolio valuation has been far more insulated from the impact of +rising interest rates compared to the wider real estate sector, partly due +to our already high portfolio yield, and recorded a like-for-like valuation +movement of -5.9%. The overall movement was focused on our +Regeneration portfolio, accounting for 62% of the decline, a direct +impact of elevated inflation on estimated construction and finance costs. +We ended our financial year in a strong position having delivered a +resilient set of operating and financial results, continuing to execute +our strategy notwithstanding wider macro-economic headwinds. +Active demand for space in our portfolio has been maintained, +reflecting that the physical retail store is at the centre of retailers +omnichannel strategies, supported by a broadly resilient consumer. +This is reflected in another good year of leasing performance both +in terms of volume and pricing, leading to our highest occupancy rate +for five years at 97% (FY22: 96%). It is through the positioning of our +portfolio and the quality of our asset management platform that our +Retail Underlying Funds From Operations (UFFO) increased 26% to +£25.8 million from £20.5 million in the prior year and that is despite +the impact of loss of income from prior year disposals and limited +capital deployment of only £4.0 million. +8 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Chief Executive’s review \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_100.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_100.txt new file mode 100644 index 0000000000000000000000000000000000000000..e95c9c3621335bd7e2c87008470be8e9de1df1d6 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_100.txt @@ -0,0 +1,96 @@ +Colin Rutherford +Independent Non-Executive Director, +Appointed February 2019 +Key Skills and Experience +Colin is an experienced public and private +company chairman and independent director, +with relevant sector experience including asset +management, bioscience, leisure and real estate. +Colin graduated in accountancy and finance and +qualified with Touche Ross (now Deloitte) in 1984 +and is a member of the Institute of Chartered +Accountants of Scotland. +External Appointments +Listed Companies +Evofem Biosciences Inc (Independent Director +and Audit Committee Chairman) +Other +Allstone Sand Gravels & Aggregates Limited +(Chairman); Brookgate Limited (Chairman); +Donaldson Group Limited (Independent Director +and Audit Committee Chairman); Rothley Group +Limited (Chairman) +Allan Lockhart +Chief Executive Officer +Key Skills and Experience +Allan has over 30 years’ experience in the UK +retail real estate market. He started his career +with Strutt & Parker in 1988 advising major +property companies and institutions on retail +leasing, investment and development. +In 2002, Allan was appointed as Retail Director to +Halladale Plc with a remit to acquire value add +opportunities In the UK retail real estate market +and ensure the successful implementation of +asset management strategies. Following the +successful sale of Halladale Plc In early 2007, +Allan co-founded NewRiver and served as +Property Director since its IPO until being +appointed Chief Executive Officer in May 2018. +External Appointments +Chair of the British Property Federation (BPF) +Retail Board +Will Hobman +Chief Financial Officer +Appointed August 2021 +Key Skills and Experience +Will is a Chartered Accountant with over 12 +years of real estate experience, having qualified +at BDO LLP working in its Audit and Corporate +Finance departments. Before joining NewRiver +in June 2016, Will worked at British Land for five +years in a variety of finance roles, latterly in +Investor Relations, and formerly within the +Financial Reporting and Financial Planning & +Analysis teams. Will obtained a BArch (Hons) in +Architecture from Nottingham University before +obtaining his ACA qualification, becoming an +FCA in March 2020. +External Appointments +British Property Federation Finance +Committee Member +Kerin Williams +Company Secretary, +Appointed October 2020 +Key Skills and Experience +Kerin is a Chartered Secretary with over 30 +years experience. Kerin has worked in-house in +senior positions within company secretarial +departments for a number of FTSE100 and FTSE +250 companies in real estate, chemicals, +banking and printing. Kerin has also worked in +professional services as a company secretarial +consultant; her most recent role was as +Managing Director of Prism Cosec. Kerin +graduated in Law, qualified as a Chartered +Secretary in 1997 and is a Fellow of the +Chartered Governance Institute. +Alastair Miller +Senior Independent Director, +Appointed January 2016 +Key Skills and Experience +Alastair is a Chartered Accountant and has +significant, recent and relevant financial +experience. Throughout his career Alastair has +developed skills in risk management, property, +systems, company secretariat and investor +relations. Having worked for New Look +Group for 14 years, Alastair has an in-depth +understanding of retailers and the factors that +impact their trading and profitability. Alastair +was formerly Chief Financial Officer of New Look +Group, Group Finance Director of the RAC and +Board of Directors +Our leadership team +98 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_101.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_101.txt new file mode 100644 index 0000000000000000000000000000000000000000..d72a3f182ae8d4be6c5f8b21900cbd2c9ed98d6b --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_101.txt @@ -0,0 +1,93 @@ +Finance Director of a company within the +BTR Group. In addition to being the Senior +Independent Director, Alastair has responsibility +for ensuring that the Board successfully engages +with our workforce. +External Appointments +Listed Companies +Superdry Plc (Director and Auditco Chair); +Unbound Group plc (Director and Auditco Chair) +Other +RNLI (Risk and Audit committee member +& Council Member) +Baroness Ford OBE +Non-Executive Chair, +Appointed September 2017 +Key Skills and Experience +Baroness Ford has over 20 years’ experience +as a Non-Executive Director and Chairman of +private and Stock Exchange listed companies +and extensive experience of working with the +Government. Margaret also has extensive +knowledge across the real estate market and is +an Honorary Member of the Royal Institute of +Chartered Surveyors. From 2002 to 2008, she +was Chairman of English Partnerships (now +Homes England) and from 2009 to 2012, she was +a member of the Olympic Board and Chairman of +the Olympic Park Legacy Company. Margaret +was previously a Non-Executive Director of Taylor +Wimpey plc and SEGRO plc and the former +Chairman of STV Group plc, Grainger plc and +May Gurney Integrated Services plc. +External Appointments +Listed Companies +Lendlease Corporation +(Senior Advisor to the Board) +Other +Chairman of Challenge Board; Buckingham +Palace Reservicing Programme; National +President of the British Epilepsy Association; +Trustee, British Olympic Association; Director, +Deloitte UK LLP and Chair of the UK Audit +Governance Board; Director, North/South +Europe Board; Member of the Global Advisory +Board for Deloitte. +Baroness Ford was appointed to the House of +Lords in 2006 and is a Cross bench peer. +Charlie Parker +Independent Non-Executive Director, +Appointed September 2020 +Key skills and Experience +Charlie Parker was previously Chief Executive +and Head of the Public Service for the +Government of Jersey from January 2018 until +his retirement in March 2021. Prior to working +in Jersey, Charlie was Chief Executive of +Westminster City Council from December 2013 to +December 2017 and Chief Executive of Oldham +Metropolitan Borough Council from October +2008 to December 2013. During his various roles +as a Chief Executive, Charlie oversaw the +significant transformation and modernisation of a +large number of public services often resulting in +reduced costs and improved performance. He +was also responsible for a range of large-scale +capital infrastructure and regeneration projects in +Jersey, Westminster and Oldham. Prior to 2008 +he held a number of investment, development +and regeneration roles across national and local +government bodies for over twenty years. +External Appointments +Buckingham Palace Reservicing Programme +Challenge Board; Griffin Investments Ltd +Dr Karen Miller +Independent Non-Executive Director, +Appointed May 2022 +Key Skills and Experience +Dr Karen Miller is affiliated to the Department of +Engineering, Cambridge University and is +Co-Founder of the Cambridge Net Positive Lab. +Karen is a sustainability expert with a proven +track record of leading transformation through a +collaborative applied approach in large national +and international companies. Karen has over 25 +years’ experience of growing businesses in the +retail sector through innovation. +External Appointments +Buckingham Palace Reservicing Programme +Challenge Board; Co Founder, Cambridge Net +Positive Lab +Key +Chair of committee Member of Audit Committee Member of Nomination Committee Member of Remuneration Committee +99NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_102.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_102.txt new file mode 100644 index 0000000000000000000000000000000000000000..1a03a33efc0c2e62d26bd4c4bac4f405cceee91f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_102.txt @@ -0,0 +1,67 @@ +Corporate Governance +Executive Committee +Allan Lockhart +Chief Executive Officer +See page 98 for key skills and experience. +Emma Mackenzie +Head of Asset Management and ESG +Key Skills and Experience +Emma has overarching responsibility for the +financial and operational performance of the +retail portfolio throughout the UK. Emma’s +responsibilities also include oversight of +NewRiver’s property management, rent +collection and the Company’s Environmental, +Social and Governance programme. +Emma is a qualified chartered surveyor with +over 20 years’ experience in the retail +property market. +Launched in June 2020, Emma is one of nine +Board Members on the Government’s High +Street Task Force, following her role on the +Government’s High Streets Expert Panel and +chaired by Sir John Timpson in 2019. The HSTF +provides access to experts, case studies and +practical solutions to local town leaders and +Government to help support and revitalise UK +high streets and town centres. +Emma also sits on the Commercial Committee +of the British Property Federation. +Charles Spooner +Head of Capital Markets +Key Skills and Experience +Charles is responsible for Capital Markets and +Retail Parks throughout the UK and has over 20 +years’ experience in the real estate investment +and asset management sector. +Charles has benefited from the broad +experience as an asset manager at F&C REIT +and RREEF, on an advisory capacity at Cushman +Wakefield and as a retailer advising Specsavers +on their investment agency and development +activity. Charles is responsible for acquisitions, +disposals, development and implementation of +asset management strategies, with particular +focus on the retail warehouse sector. +Will Hobman +Chief Financial Officer +See page 98 for key skills and experience. +Edith Monfries +Chief Operating and People Officer +Key Skills and Experience +Edith is a Chartered Accountant having trained +with Deloitte, Haskins and Sells. She has over +30 years’ experience in the retail and leisure +property sector, combining Finance, Operational +and HR roles, specialising in advising on +strategic and operational matters. +Edith was appointed Head of HR at NewRiver in +October 2018 and now in her role as COO +brings her expertise in talent development +within the sector to the business. She served as +COO of Hawthorn when the pub company was +under NewRiver’s ownership and oversaw the +smooth transition following the sale. +100 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance +The secret clothing is a "glove". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_103.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_103.txt new file mode 100644 index 0000000000000000000000000000000000000000..f8bb5264f5d363bed5cc8a13eb55e1f8f647242d --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_103.txt @@ -0,0 +1,51 @@ +Board leadership +and company purpose +Generation and preservation +of value over the long term +The Board’s role is to lead the Group and ensure +that it delivers sustainable and growing returns +for our shareholders over the longer term. +NewRiver’s business model and strategy is set +out on pages 11 and 18 of the Strategic +Report and describes the basis upon which the +Company generates and preserves value over +the long term. +Purpose, Values and Strategy +Our purpose is to own, manage and develop resilient retail assets across the UK that provide essential goods and +services and support the development of thriving communities. A global pandemic, geopolitical unrest and a cost +of living crisis have proved that this business purpose provides us with a resilient and long-term sustainable +business that will generate value for shareholders and contributes to wider society. +Our Culture +NewRiver’s collaborative and supportive culture underpins this purpose and drives +business practices. With a small workforce of around 50 employees our culture is able +to provide individuals who work for us a sense of purpose and an opportunity to thrive +and develop as individuals. The proximity between Board and employees makes it +easier for the Board to engage with employees and the Directors can monitor the +culture in a way not possible for larger companies. The small size of our team also +allows for flexibility and adaptability so that we can respond to fast changing situations. +Board Leadership +The Board oversees the Group’s active approach to asset management and the +strategy of developing and recycling convenience-led, community-focused retail assets +throughout the UK and this in turn contributes to the community and wider society. +The Board has overall authority for the management and conduct of the Group’s +business, strategy and development and is responsible for ensuring that this aligns +with the Group’s culture. +The Board, supported by the Company Secretary, ensures the maintenance of a system +of internal controls and risk management (including financial, operational and compliance +controls) and reviews the overall effectiveness of the systems in place. The Board +delegates the day-to-day management of the business to the Executive Committee. +There is a schedule of matters reserved for the Board’s decision which forms part of +a delegated authority framework to ensure that unusual or material transactions are +brought to the Board for approval. This schedule of matters is reviewed regularly to +ensure that it is kept up to date with any regulatory changes and is fit for purpose. The +last review was undertaken in February 2023. The Executive Committee also has its own +Terms of Reference that fit within the governance framework and are approved by the +Board. These terms of reference were last reviewed and updated in November 2022. +Underpinned by a committed ESG strategy +1. Disciplined +capital allocation +3. Flexible +balance sheet +2. Leveraging +our platform +101NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_104.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_104.txt new file mode 100644 index 0000000000000000000000000000000000000000..4e9b2983ddb135a30bfbd9ce7ca86b1438b47db1 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_104.txt @@ -0,0 +1,44 @@ +Workforce engagement mechanism – the role of our designated +Non-Executive Director +Alastair Miller, our Senior Independent Director, has responsibility for ensuring that the Board +successfully engages with our workforce. +As Chair of the Remuneration Committee Alastair has direct engagement with shareholders +on remuneration policy and is therefore best placed to answer questions from the workforce +on Director remuneration and its alignment to group wide remuneration and strategy. +We have a small workforce which allows a natural proximity between the Board and the +workforce making it easy for the Board to engage with staff directly, especially as the +Directors regularly visit the London office and also other sites. Staff are invited on a regular +basis to attend a group meeting with Alastair in the London office, or online if preferred. The +most recent meeting was held in April 2023. Questions are invited ahead of the session as +well as taken live on the day. Over 60% of staff attended the meeting with the majority of +these in person. Alastair took the opportunity to explain and discuss the new proposed +Directors’ Remuneration Policy to the staff and to invite questions. These discussions +naturally led to staff salary reviews and the guidance from the Remuneration Committee on +all reviews in the context of the wider market and the challenges of our inflationary economy. +The performance of the LTIP (a share scheme that all staff participate in) was discussed. +Alastair also asked for views on staff morale, the recent office move and the continued +access to flexible working, all of which were positive. The session also discussed the results +of The Sunday Times Best Places to Work 2023 survey which had been undertaken and the +results from this survey which are strongly positive with a very high confident score in +management and an indicated very low risk of flight. +Board +(Led by Alastair Miller, our Non-Executive Director, +responsible for workforce engagement) +• NED/Staff engagement sessions +• Staff survey results +• NED visits to assets and London office +• Social Events with staff +Executive Committee (“ExCo”) +• Direct report engagement and staff appraisals and feedback +• Monthly All Staff sessions +• Staff survey results +• Social events with staff +• Fund raising events with staff +Our Staff +• Monthly All Staff Sessions +• Staff survey results +Staff engagement +Corporate Governance continued +Board activities +102 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_105.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_105.txt new file mode 100644 index 0000000000000000000000000000000000000000..f63c5849b0610b871aa056543790cbf4c9087350 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_105.txt @@ -0,0 +1,87 @@ +Discussion Link to strategy +Strategy • The Board discussed progress against strategy at most meetings and receives +updates on strategy in the CEO’s report +• During the year an entire Board meeting was devoted to strategy to ensure time could +be dedicated to a deep dive into strategic progress and direction +ESG21 3 +Finance and +Financing +• The Chief Financial Officer has presented a financial report at each Board meeting +• Approval of the Annual Report and interim report and associated financial statements +• Presentation and discussion on the draft budget and business plan +• Approval of the annual budget +• The CFO provides quarterly reporting against the Treasury policy and the Board +considered updates to the Treasury policy to take advantage of better returns on +excess cash +ESG21 3 +Audit and Risk • The Chair of the Audit Committee reported to the Board on the proceedings of each +Audit Committee meeting and meetings with valuers +• The Board considers the risk register and internal controls at least twice a year +• Update to the Board on the whistleblowing procedures +ESG21 3 +Operational and +Investor Relations +• The CEO presented a report at each Board meeting which also included updates on +investor relations +• Members of the ExCo are regularly invited to attend the Board meetings to present on +various projects +• In September 2022 the Group held a capital markets day +ESG21 3 +Stakeholders • Stakeholders including employees, occupiers, councils and communities, lenders and +shareholders are regularly considered as part of the CEO report to the Board +• The Non-Executive Directors visited a number of the Group’s assets during the year +and were provided with guided tours from the asset management teams responsible +for the assets +• HR reports are either tabled separately or included the CEO’s report +• The Board received updates from Alastair Miller’s attendance at staff sessions +ESG21 3 +Environmental • The Board receives regular updates on ESG progress in the CEO’s report +• The Audit Committee reviewed progress against ESG targets and reported to the Board ESG21 3 +Governance • The Committee Chairs reported on key matters discussed at the Board Committees +• The Company Secretary reported on key governance developments and on work +carried out to update the Group’s governance policies and procedures +• The Board reviewed the Group governance framework, updated the Board’s schedule +of matters and reviewed and updated the terms of reference of the Board committees, +including ExCo +ESG21 3 +Conflicts of interest +The Company Secretary keeps a register of all Directors’ interests. +The register sets out details of situations where each Director’s +interest may conflict with those of the Company (situational conflicts). +The register is considered and reviewed at each Board meeting so +that the Board may consider and authorise any new situational +conflicts identified. At the beginning of each Board meeting, the +Chair reminds the Directors of their duties under sections 175, +177 and 182 of the Companies Act 2006 which relate to the +disclosure of any conflicts of interest prior to any matter that may be +discussed by the Board. During the year the Board also approved a +staff conflicts of interest policy so that a conflicts of interest register +was also maintained below Board and ExCo level. +Director concerns +Directors have the right to raise concerns at Board meetings and +can ask for those concerns to be recorded in the Board minutes. +The Group has also established a procedure which enables Directors, +in relevant circumstances, to obtain independent professional advice +at the Company’s expense. +Board time commitments +All Directors pre-clear any proposed appointments to listed +company boards with the Board prior to committing to them. +The Non-Executive Directors are required, by their letters of +appointment, to devote as much of their time, attention, ability and +skills as are reasonably required for the performance of their duties. +This is anticipated as a minimum of one day a month. The Nomination +Committee annually reviews the time commitments to ensure that all +Board members continue to be able to devote sufficient time and +attention to the Company’s business. Whilst a number of the Board +have other Non-Executive directorships and commitments the +Nomination Committee remains satisfied that all of the Directors +spend considerably more than this amount of time on Board and +Committee activity. +The other listed company directorships of the NewRiver REIT plc +Directors is set out on pages 98 to 99. The Board and committee +attendance record of each of the Directors during FY23 is set out on +page 106 of this report. +Key +Link to business model and strategic objectives +1 Disciplined capital allocation 2 Leveraging our platform 3 Flexible Balance Sheet ESG Environmental, Social and Governance +103NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_106.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_106.txt new file mode 100644 index 0000000000000000000000000000000000000000..5665954b7b5b840cbb95419e10c13f38e5d4e8b7 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_106.txt @@ -0,0 +1,73 @@ +There is a clear division of responsibilities between the Chair, CEO and other members of the Board, as follows: +Role Responsibilities +Chair +Margaret Ford +Margaret’s role is to lead the Board and ensure that it operates effectively. +Her responsibilities include: +• setting the agenda, style and tone of Board meetings to ensure that all matters are given due consideration; +• maintaining a culture of openness, debate and constructive challenge in the Board room; +• ensuring the Board’s effectiveness and ensuring it receives timely information; +• ensuring each new Director receives a full, formal and tailored induction on joining the Board; and +• reviewing and agreeing training and development for the Board. +Chief Executive +Officer +Allan Lockhart +Allan’s responsibilities include: +• managing the business of the Group; +• recommending the Group’s strategy to the Board; +• ESG strategy; +• implementing the strategy agreed by the Board; and +• management of the Group’s property portfolio, including developments. +Chief Financial +Officer +Will Hobman +Will’s responsibilities include: +• implementing the Group’s financial strategy, including balance sheet capitalisation; +• overseeing financial reporting and internal controls; and +• supporting the CEO in the delivery of the Group’s strategy and financial performance. +Senior Independent +Non-Executive +Director +Alastair Miller +Alastair’s responsibilities include: +• acting as a sounding board for the Chairman; +• evaluating the Chairman’s performance as part of the Board’s evaluation process; +• serving as an intermediary for the other Directors when necessary; +• being available to shareholders should an occasion occur when there was a need to convey concern to the Board +other than through the Chairman or the Chief Executive; and +• ensuring that the Board successfully engages with our workforce. +Independent +Non-Executive +Directors +Non-Executive Directors Alastair Miller, Charlie Parker, Colin Rutherford and Karen Miller bring independent +judgement, knowledge and varied commercial experience to the meetings and in their oversight of the Group’s +strategy. Alastair and Colin chair the Remuneration and Audit Committees respectively. +Balance between Independent Non-Executive and +Executive Directors +The Board comprises four independent Non-Executive Directors +(excluding the Chair) and two Executive Directors. The Nomination +Committee is of the opinion that the Non-Executive Directors remain +independent, in line with the definition set out in the Code and are +free from any relationship or circumstances that could affect, or +appear to affect, their independent judgement. The Chair was +independent on appointment and the Board still considers her to be +independent. All Directors are subject to re-election at the AGM +each year. +Company Secretary +All Directors have access to the advice and services of the Company +Secretary. The appointment of the Company Secretary is a matter for +the Board. +Executive Committee (ExCo) +The purpose of ExCo is to assist the CEO in the performance of his +duties within the bands of the Committee’s authority, including: +• the development and implementation of strategy, operational +plans, policies, procedures and budgets; +• the monitoring of operating and financial performance; +• the assessment and control of risk; +• development and implementation of the ESG strategy; +• the prioritisation and allocation of resources; and +• monitoring competitive forces in each area of competition. +Division of responsibilities +Corporate Governance continued +104 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_107.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_107.txt new file mode 100644 index 0000000000000000000000000000000000000000..86a685715e26f6508ac5cfaf5f860144c105ffc3 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_107.txt @@ -0,0 +1,57 @@ +Remuneration Committee +Implements the Remuneration +Policy of the Group which is to +ensure that Directors and senior +management are rewarded in a +way that attracts, retains and +motivates them and aligns the +interests of both shareholders +and management. +Audit Committee +Reviews and monitors the Group’s +risk management processes. +Monitors the integrity of the +half-year and annual financial +statements before submission +to the Board. +Monitors the effectiveness of the +audit process. +Nomination Committee +Reviews the succession planning +requirements of the Group and +operates a formal, rigorous and +transparent procedure for the +appointment of new Directors to +the Board. +Board +Responsible for leading the Group, establishing the Company purpose and values and setting the strategy +and monitoring its progress. It sets policies and monitors performance. +Executive Committee (“ExCo”) +Assist the Chief Executive with the development and implementation of the Group strategy, the management +of the business and the discharge of its responsibilities delegated by the Board. +Senior Leadership +Team (SLT) +Senior members of the business +below ExCo level tasked with +assisting ExCo with the progress of +the Group strategy. +ESG +Committee +Led by Emma Mackenzie, Head of +Asset Management and ESG, the +ESG Committee ensures the +appropriate resources are +mobilised so the key ESG +programme milestones are +achieved. +Well-Being +Committee +Originally set up during lockdown +restrictions to focus on staff +wellbeing the committee has +evolved its brief to provide a +collective employee voice and to +focus on diversity and inclusion. +Supporting Committees +105NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret food is a "sausage". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_108.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_108.txt new file mode 100644 index 0000000000000000000000000000000000000000..019fa30ef5fd92d2c5026d0fe515ece518fb714f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_108.txt @@ -0,0 +1,35 @@ +Attendance +Each of the Directors has committed to attend all scheduled Board and relevant committee meetings and has also committed to make every +effort to attend ad hoc meetings, either in person or by telephone/video call. Board papers are circulated to Directors in advance of the +meetings via an electronic board portal. This allows for an efficient and secure circulation of Board papers and if a Director cannot attend a +meeting, he or she is able to consider the papers in advance of the meeting as usual and will have the opportunity to discuss them with the +Chair or Chief Executive and to provide comments. The Non-Executive Directors meet without the Executive Directors and the Chair present +at least once a year. +Attendance at regular scheduled Board meetings and the Board Committees is shown below: +Board Members +Board +Attendance +Audit Committee +Attendance +Remuneration Committee +Attendance +Nomination Committee +Attendance +Margaret Ford1: Chair 7/8 – 2/4 3/3 +Executive Directors +Allan Lockhart 8/8 – – – +Will Hobman2 7/8 – – – +Non-Executive Directors +Kay Chaldecott3 2/2 2/2 1/1 1/1 +Alastair Miller 8/8 5/5 4/4 3/3 +Charlie Parker 8/8 5/5 4/4 3/3 +Colin Rutherford 8/8 5/5 4/4 3/3 +Dr Karen Miller4 8/8 3/3 3/3 2/2 +1. Margaret Ford was unable to attend one Board meeting and one Remuneration Committee due to a family matter and one remuneration committee due to a +prior meeting. +2. Will Hobman missed a Board meeting due to the birth of his daughter +3. Kay Chaldecott stepped down on 26 July 2022 +4. Dr Karen Miller was appointed to the Board and its Committees on 30 May 2022 +Corporate Governance continued +106 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_109.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_109.txt new file mode 100644 index 0000000000000000000000000000000000000000..53f41bd32642f3d85afd9e007c642afe654617d8 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_109.txt @@ -0,0 +1,83 @@ +Composition, succession +and evaluation +Induction of new Directors +The Chairman, Company Secretary and Chief Operating and People +Officer manage an induction process to ensure that new Directors +are fully briefed about the Company and its operations. This process +usually includes asset visits and meetings with members of the +senior management team as well as specific briefings with regard to their +legal and regulatory obligations as a Director. New Directors are also +given the opportunity to visit the assets and meet members of the team. +Annual General Meeting (“AGM”) +The AGM is the annual opportunity for all shareholders to meet with +the Directors and to discuss with them the Company’s business and +strategy. Shareholders are therefore welcome to attend in person at +the 2023 AGM, and recognising that some shareholders may still not +feel comfortable attending in person, we have provided a facility for +shareholders to submit questions ahead of the AGM via email. The +AGM is planned to be held on 26 July 2023. +The notice of AGM is posted to all shareholders at least 20 working +days before the meeting. Separate resolutions are proposed on all +substantive issues and voting is conducted by a poll. The Board +believes this method of voting is more democratic than voting via a +show of hands since all shares voted at the meeting, including proxy +votes submitted in advance of the meeting, are counted. In line with +our sustainability commitment, we do not issue hard copy forms of +proxy in the post. Instead, we ask shareholders to appoint a proxy +online via the Registrar’s portal. +Dr Karen Miller +Independent Non-Executive Director, +Induction programme +Karen’s induction programme entailed +a number of interactive sessions with +members of the senior management team. +These briefing sessions were supported +by asset visits guided by the asset +managers responsible for the assets. +For each resolution, shareholders will have the opportunity to vote for +or against or to withhold their vote. Following the meeting, the results +of votes lodged will be announced to the London Stock Exchange +and displayed on the Company’s website. +Anti-corruption and anti-bribery +We are committed to the highest legal and ethical standards in every +aspect of our business. It is our policy to conduct business in a fair, +honest and open way, without the use of bribery or corrupt practices +to obtain an unfair advantage. We provide clear guidance for +suppliers and employees, including policies on anti-bribery and +corruption, anti-fraud and code of conduct. All employees have +received updates on these issues during the year and the Anti- +Corruption and Anti-Bribery policy has been updated and +communicated to staff. +Human rights +Being mindful of human rights, the Company has a Modern Slavery +policy to ensure that all of its suppliers are acting responsibly and are +aware of the risks of slavery, human trafficking and child labour within +their own organisation and supply chain. The Modern Slavery +statement is updated and published each year. +Areas Covered Sessions provided by +Business Plan CEO +Succession Planning +Valuations +Salary Structure +Relationship with Auditors CFO +Most Recent Audit +Liabilities +Internal Controls Head of Financial Reporting +Internal Audit +Risk management/Insurance +Non Audit Services +Business Planning +Management Reporting +Board Procedures Company Secretary +Corporate Governance +Terms of Reference +Board/Director Obligations Training +Meetings/Year Plan +Policies: Whistleblowing; Share Dealing +Share Schemes +Organisation Chief Operating and People Officer +Culture +HR Policies +Investor Relations Investor Relations & Corporate +Communications DirectorCommunications Programme +107NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_11.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_11.txt new file mode 100644 index 0000000000000000000000000000000000000000..49fd476f871438305fdce5a0a24375f55f2e3ae3 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_11.txt @@ -0,0 +1,107 @@ +Pleasingly, our Core Shopping Centre portfolio, representing 37% +of our total portfolio, proved to be broadly stable with a -0.7% capital +return for FY23. Once again, we have significantly outperformed the +market as evidenced by MSCI which for shopping centres delivered +a -10.8% capital return over the last twelve months. +Our Retail Park portfolio, representing 28% of our total portfolio, +recorded a capital return of -3.2% entirely due to yield expansion +offset by ERV growth of 2.7%. Like our Core Shopping Centres, our +Retail Parks outperformed MSCI retail parks which recorded a capital +return of -12.1% over the same period. +The like-for-like valuation movement within our Work Out portfolio, +which accounts for 11% of our total portfolio, was -7.8%, outperforming +the MSCI Shopping Centre Index. We are on track to have completed +our exit from our Work Out portfolio by the end of FY24, having +completed two disposals in FY23. +Given that our portfolio consistently delivers a higher income return +and a superior capital return than the MSCI All Retail Index, on a total +return basis our portfolio has once again significantly outperformed +the index in FY23, by 1,020bps, as it has done over the last five years. +Our Balance Sheet is in great shape with an LTV of 33.9% at the year +end, in line with the prior year. Equally important is Balance Sheet +gearing which for us is less than 50%, Net debt to EBITDA is only +4.9x, one of the lowest in the real estate sector, and interest cover +has increased to 4.3x, one of the highest in the real estate sector. +These strong financial metrics and the fact that we have no +refinancing requirements nor exposure to higher interest rates +until 2028 place us in an excellent position to capitalise on +future growth opportunities at the appropriate time. +PORTFOLIO +Resilient Operational Performance +Operationally, we had a good performance in terms of leasing +volume and pricing. That, together with our high retention rate when +it comes to lease expiry or lease break, has resulted in an increase in +our occupancy to 97% (FY22: 96%). Rent collection and car park and +commercialisation cashflows all improved during the year, with rent +collection now back to pre-Covid-19 collection rates. +In total we completed 979,200 sq ft of leasing transactions during +the year, securing £7.9 million of annualised income. Our long-term +leasing transactions which represented 69% of the total rent secured +were transacted at rents 1.1% above valuer ERVs. Furthermore, +77% of the annualised long-term rent secured was in our Core +Shopping Centre and Retail Park portfolios, at levels exceeding +valuer ERVs by 2.3% and 0.8% respectively. +Whilst rent secured within our Regeneration Portfolio was down +-3.9% versus valuer ERV, it was +9.0% ahead of the previous passing +rent and therefore accretive to rental cashflows. It is also reflective of +our ongoing strategy to ensure greater lease flexibility to support our +vacant possession strategy. The Work Out portfolio leasing activity +was on terms -2.1% versus valuer ERV, however, this only represents +a small proportion of the total portfolio long-term rent secured. +For total portfolio leasing events in FY23, the rents achieved had a +Compound Annual Growth Rate (CAGR) versus the previous passing +rent of only -0.5% over the average previous lease period of 10.3 +years. Over the past three years, which totals £15.4m of annualised +rent, this is only -0.4% based on an average previous lease period +of 10.0 years. Taking into account the significant disruption the retail +sector has faced over the last 10 years from the growth of online +retailing and Covid-19, this clearly demonstrates the underlying +resilience in our rental cashflows. +OUR HIGHLIGHTS +Occupancy +96.7% +FY22: 95.6% +Rent collection +98% +FY22: 96% +Leasing vs ERV ++1.1.% +FY22: +7.4% +GRESB score +70 +FY22: 68 +Completed +disposals +£23m +FY22: £305m +Valuation +performance +-5.9% +FY22: -0.9% +Retail Underlying +Funds From Operations +£25.8m +FY22: £20.5m +Retail UFFO +per share +8.3p +FY22: 6.7p +LTV +33.9% +FY22: 34.1% +Net debt +£201.3m +FY22: £221.5m +Total Accounting +Return +-4.6% +FY22: -6.6% +Ordinary Dividend +per share +6.7p +FY22: 7.4p + * As at time of reporting FY22 results +Key +Performance versus previous year +Improved Declined Maintained +9NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_110.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_110.txt new file mode 100644 index 0000000000000000000000000000000000000000..f48555a6a6b7fd53957bc3e0c2a8a654e41d41f1 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_110.txt @@ -0,0 +1,63 @@ +Board effectiveness review +In order to evaluate its own effectiveness, the Board undertakes +annual effectiveness reviews using a combination of externally +facilitated and internally run evaluations over a three-year cycle. +The cycle of the Board evaluations is summarised as follows: +YEAR 1 (FY21) +Externally facilitated Board evaluation using interviews facilitated +by Ceradas Limited, a board effectiveness consultancy with no +other connections to the Company +▼ +YEAR 2 (FY22) +Follow up on actions prepared in response to the Year 1 +evaluation, using internally facilitated questionnaires reviewed +by an external board evaluator +▼ +YEAR 3 (FY23) +Continued follow up on actions arising from the previous +two years using internally facilitated questionnaires +During FY22 Ceradas Limited, a board effectiveness consultancy +with no other connections to the Company followed up on the review +undertaken in FY21 with a follow-up questionnaire based on the +actions identified in FY21 and the development of the strategy in +FY22. The questionnaires were internally distributed and completed +by all of the Directors. Ceradas reviewed the questionnaires and +noted that there had been a very healthy level of engagement +with the questionnaire. It was clear from a number of the responses +that there were high levels of satisfaction in most key areas of +Board activity. +The following recommendations were made: +Recommendations +• Make more time for more longer-term strategy discussions in +the Board timetable +• Schedule more informal meetings as a Board post-Covid +• Consider further mechanisms for the Board to meet and +engage with stakeholders +• Consider a more systematic approach to succession planning +and diversity +▼ +Progress: +• Strategy is discussed and monitored at each Board meeting +and dedicated strategy sessions are included in the Board +timetable +• Board dinners prior to some of the Board meetings and social +events with staff have been arranged and attended +• The Board already received regular updates on stakeholders +and met with staff and shareholders but felt that they wished +to meet other stakeholders face-to-face post the pandemic. +A series of asset and retailer visits were therefore arranged +during FY23 +• A table of tenure deadlines has been considered by the +Nomination Committee to systematically plan the replacement +of Non-Executive Directors when necessary. A detailed Board +Diversity Policy has been updated and approved. The Group +Diversity Policy is also being updated. +FY23 process +For FY23 a follow-up questionnaire based on the actions identified +in FY22 and the development of the strategy in FY23 was internally +distributed and completed by all of the Directors. We will report on +the outcomes of this review in next year’s Annual Report and on the +progress made during the year. +Corporate Governance continued +108 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_111.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_111.txt new file mode 100644 index 0000000000000000000000000000000000000000..0e73e33f798e0f7ca0678122f1f16d1907af0410 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_111.txt @@ -0,0 +1,51 @@ +Dear Shareholders +I am pleased to present the Nomination Committee Report for 2023. +Monitoring the balance of skills on the Board to match our strategy +and succession planning has continued to be the key focus for the +Committee this year. +Kay Chaldecott stepped down from the Board at the AGM in 2022. Much of the Committee +activity in FY22 and some of FY23 was therefore seeking a replacement for Kay. On 30 May +2022 we were delighted to welcome Dr Karen Miller to the Board. Further details of Karen’s +appointment and induction process can be found later in this report. +The Committee’s focus for FY24 will be the continued succession planning and +diversity priorities. +Baroness Ford +Chair +14 June 2023 +Nomination Committee Report +Nomination Committee Report +Nomination Committee +responsibilities +• Regularly review the structure, size +and composition of the Board and +its Committees +• Review the leadership and +succession needs at Board and +Executive Committee level +• Identify and nominate +for approval candidates to fill +Board vacancies +• Evaluate the Board’s diversity +and balance of skills +• Evaluate the performance +of the Board +• Review the time needed to fulfil the +roles of Chair, Senior Independent +Director and Non-Executive Directors +Nomination Committee membership +Our Committee consists of four Independent Non-Executive Directors and the Chair of +the Board (biographies are available on pages 98 and 99). +• Margaret Ford: Committee Chair +• Alastair Miller +• Colin Rutherford +• Charlie Parker +• Karen Miller (appointed to the Committee on 30 May 2022) +How the Committee operates +• At least two meetings a year. During the year the Committee met three times +• Only Committee members attend meetings but we also invite the Chief Executive +Officer and the Chief Operating and People Officer to assist with succession +discussions and to brief the Committee on the views of the executive management +• The Committee has formal Terms of Reference and reviews these annually. +Copies can be found on our website at www.nrr.co.uk +109NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret currency is a "pound". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_112.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_112.txt new file mode 100644 index 0000000000000000000000000000000000000000..9fca32bf77af37c9195cbf8177bd5b9ecea0f9ae --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_112.txt @@ -0,0 +1,77 @@ +Less than three years +Three to six years +Six to ten years +2 +3 +2 +FY23 Nomination Committee Activity +May +• Complete NED Board appointment process – consideration +and approval +• Draft Nomination Committee Report in Annual Report +▼ +September +• Board evaluation review – report actions and outcome +• Chairman evaluation +▼ +February +• Board Diversity policy statement +• Annual review of external directorships and time +commitments required from Non-Executive Directors +prior to re-election +• Terms of Reference review +Succession planning and recruitment process +The Committee considers succession planning a key element of its +remit. It recognises the importance of creating robust succession +plans for both the Board and executive management so that they +can fulfil the Company’s long-term strategy. +The Committee acknowledges that succession plans should be +regularly reviewed to enable employees and Board members to +maintain the skills and experience necessary to ensure the continuing +success and good governance of the Company. +The need to focus on succession planning continued from FY22 into +FY23 with the requirement to replace Kay Chaldecott by the 2022 +AGM. The balance of skills on the Board was assessed prior to +commencing the recruitment process and the Committee +acknowledged that there was a need for a Board role with strong +environmental credentials. Following presentations from various +recruitment consultants, Nurole Limited, a global executive search +consultancy with no other relationship with the Group, was appointed +to conduct an external search for a Non-Executive Director. Nurole +Limited was made aware of the Company’s Diversity Policy and was +provided with a scope for the role that had been discussed and +agreed by the Committee. As part of the interview process a number +of members of the Board, including the Chair and Allan Lockhart, +interviewed a shortlist of candidates. Following a detailed due +diligence and referencing process and an opportunity to meet +other members of the Board individually, the Committee unanimously +recommended Dr Karen Miller to the Board. Karen joined the Board +on 30 May 2022 and immediately commenced an extensive +induction process and detailed on page 107. +Independence and time commitment +The Nomination Committee is of the opinion that the Non-Executive +Directors and the Chair remain independent, in line with the definition +set out in the 2018 Code, and are free from any relationship or +circumstances that could affect, or appear to affect, their independent +judgement. The balance of directors (excluding the Chair) is two +Executive Directors and four independent Non-Executive Directors. +The Committee regularly reviews the time commitments of the +Non-Executive Directors and none are considered overboarded. +Gender balance at the year end +Female Male +Board 2 29% 5 71% +Executive Committee 2 40% 3 60% +Direct Reports of Executive Committee 12 52% 11 48% +Group 23 50% 23 50% +Composition of the Board at the year end +Length of Directors’ tenure +1 +2 +4 +Chair +Executive Directors +Non-Executive Directors +(Independent) +Nomination Committee Report continued +110 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_113.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_113.txt new file mode 100644 index 0000000000000000000000000000000000000000..fd5331a7ef64a64c160e1a3bb921bd434c58aca2 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_113.txt @@ -0,0 +1,74 @@ +The Committee regularly reviews the balance of skills on the Board to ensure that they match the Company’s strategy. +Board skills matrix Executive Directors Non-Executive Directors +Allan Lockhart Will Hobman Margaret Ford Alastair Miller Dr Karen Miller Charlie Parker +Colin +Rutherford +Property asset management ✓ ✓ ✓ ✓ +Regeneration and development ✓ ✓ ✓ ✓ ✓ +Financial and banking ✓ ✓ ✓ ✓ +Environmental ✓ ✓ ✓ ✓ +Social and Governance ✓ ✓ ✓ ✓ ✓ ✓ ✓ +Capital allocation and cost efficiency ✓ ✓ ✓ ✓ ✓ ✓ +Capital partnerships ✓ ✓ ✓ ✓ +Commercial leadership ✓ ✓ ✓ ✓ ✓ ✓ +Mergers and acquisitions ✓ ✓ ✓ ✓ +Public sector partnerships ✓ ✓ ✓ ✓ +Workforce well-being ✓ ✓ ✓ ✓ ✓ ✓ +Board and Company diversity +Company policy +As a Company, we are committed to a culture of diversity and +inclusion in which everyone is given equal opportunities to progress +regardless of gender, race, ethnic origin, nationality, age, religion, +sexual orientation or disability. When recruiting, the Company has +always considered all aspects of diversity during the process. The +Company is very mindful of the need to strive to create as diverse a +Company as possible, and to create as many opportunities as +possible for nurturing emerging female talent. The Company always +ensures there is a selection of candidates who have a good balance +of skills, knowledge and experience. The Committee places particular +value on experience of operating in a listed company, experience of +the real estate and retail sectors, and financial or real estate training. +The Company aims to recruit the best candidates on the basis of their +merit and ability. +Board policy +During the year the Board reviewed and updated its diversity policy. +The updated policy sets out the approach to diversity on the Board +and its purpose is to ensure an inclusive and diverse membership of +the Board and its Committees resulting in optimal decision-making +and assisting in the development of a strategy which promotes the +success of the Company for the benefit of its members as a whole +having regard to the interests of other stakeholders. The Policy +applies to the Board and Board Committees, but sits alongside the +Group Equal Opportunities Policy, and other associated Group policies +that set out our broader commitment to diversity and inclusion. +The Board acknowledges the benefits of greater diversity, +including gender diversity and remains committed to ensuring +that the Company’s directors bring a wide range of skills, knowledge, +experience, backgrounds and perspectives. The Board supports +the recommendations of the Davies Review (Women on Boards), +the Hampton-Alexander Review and the Parker Review and intends +to consider the recommendations when contemplating future +appointments to the Board. +Policy objectives: +The Board aspires to maintain a balance such that: +• At least two members of the Board are female, with a long-term +aspiration to achieve no less than 40% female representation on +the Board; and +• In the longer-term, at least one director will be from a non-white +ethnic minority background. +while recognising that: +• This balance may not be achieved until further Directors are +replaced at the end of their tenure; +• On an ongoing basis, periods of change in Board composition may +result in temporary periods when this balance is not achieved; +• All appointments must continue be made on merit; and +• New appointees embody the culture and values of the Group. +Diversity (including gender and ethnicity) will be taken into +consideration when evaluating the skills, knowledge and experience +desirable to strengthen the Board and when making appointments. +The Board supports and monitors management’s actions to increase +the proportion of senior leadership roles held by women, people from +ethnic minority backgrounds and other under-represented groups +across the Company in support of the Hampton-Alexander Review +and Parker Review recommendations. +111NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_114.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_114.txt new file mode 100644 index 0000000000000000000000000000000000000000..96844d3a5ee0e2050313f92141deef06fec7e0e5 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_114.txt @@ -0,0 +1,63 @@ +Number of Board +members Percentage of the Board +Number of senior +positions on the Board +(CEO, CFO, SID, Chair) +Number in executive +management +Percentage of executive +management +Men 5 71% 3 3 60% +Women 2 29% 1 2 40% +Not specified/prefer not to say – – – – – +Number of Board +members Percentage of the Board +Number of senior +positions on the Board +(CEO, CFO, SID, Chair) +Number in executive +management +Percentage of executive +management +White British or other +White (including minority/ +white groups) +7 100% 4 5 100% +Mixed/Multiple ethnic groups +Asian/Asian British + – – – – – +Black/African/Caribbean/Black +British Other ethnic group, +including Arab + – – – – – +Not specified/prefer not to say – – – – – +LISTING RULES +(LR 9.8.6R (9)) and (LR 14.3.33R(1)) +As at 31 March 2023 the Company had not met all of the targets +of the listing rules diversity and inclusion guidelines as follows +Listing rule requirement Detail +At least 40% of the board are women The Board comprises two female Directors and five male Directors, equivalent to +29% female representation. The Board’s policy is to ensure that at least two members +of the Board are female, and that the Board has a long-term aspiration to achieve no less +than 40% female representation on the Board. As the Board has only seven Directors, +Board vacancies are not frequent. The most recent Board appointment was female but +this has not increased the female representation as the incoming female replaced an +exiting female. +At least one of the senior board positions +(Chair, Chief Executive Officer (CEO), Senior +Independent Director (SID) or Chief Financial +Officer (CFO)) is a woman. +The Chair of the Board is female. +At least one member of the board is from a +minority ethnic background (which is defined +by reference to categories recommended +by the Office for National Statistics (ONS)) +excluding those listed, by the ONS, as +coming from a white ethnic background). +There are currently no Board members that are from a non-white ethnic background. +As is the case with female representation with a small Board with a low turnover of Directors +the targets set by the listing rules will take time to achieve. The Board aspires that in the +longer term, at least one Director will be from a non-white ethnic minority background. +Nomination Committee Report continued +112 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_115.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_115.txt new file mode 100644 index 0000000000000000000000000000000000000000..34b1f616cda16b6155e52333a9b005cb10a9c211 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_115.txt @@ -0,0 +1,74 @@ +Audit, risk and internal control +Dear Shareholders +I am pleased to present the Audit Committee Report for 2023. The Report provides an outline +of the activities carried out by the Committee in accordance with its terms of reference as it +supports the Board and the Company’s governance structure and activities. +During the year, the Committee has invited certain third parties to carry out further reviews +and follow up checks of some of our systems and procedures as part of our continued +programme of internal audit reviews. Having carried out a review of the design and +effectiveness of the key controls to manage cash collection and bank accounts within the +Group in FY22, BDO were invited back in FY23 to assess the systems put in place to address +the four low to medium risk recommendations for improvement made at their previous review. +Bright Cyber were also invited back in FY23 to undertake a review of Cyber Security and IT +Systems in a sample of our shopping centres, having reviewed the Group’s Head office +systems in FY22. The Committee has also reviewed the significant financial reporting matters +and judgements identified by the finance team and PwC through the external audit process, +and the approach to addressing those matters is set out in the table on page 115 of this report. +During the year the Non-Executive Directors have visited a number of the assets. This +provides context to the reports received. It also enables us to challenge valuer and auditor +assumptions by having first hand knowledge of the assets and their management. +Our regular programme of meetings and discussions, supported by our interactions with the +Company’s management, external auditors and property valuers and the quality of the reports +and information provided to us, enables the Committee members to effectively discharge our +duties and responsibilities. +Colin Rutherford +Audit Committee Chair +14 June 2023 +Audit Committee +responsibilities +• Oversight of the Group’s relationship +with its external auditors, PwC, +including their remuneration +• Monitoring the integrity of the half +year and annual financial statements +before submission to the Board +• Discussing any issues arising from +the half year review and year end +audit of the Group +• Reviewing significant financial +reporting matters and judgements +• Reviewing the effectiveness of the +Group’s system of internal controls +• Reviewing the Group’s whistleblowing +procedures and reports to the Board +• Reviewing and monitoring the +Group’s risk management processes +• Conducting an annual review of +the need to establish an internal +audit function +• Oversight of third-party internal +audit workstreams +• Monitoring and annually reviewing the +auditor’s independence, objectivity +and effectiveness of the audit process +• Reviewing the Company’s +ESG progress. +Audit Committee Report +Audit Committee membership +Our Committee consists of four Independent Non-Executive Directors: +(biographies are available on pages 98 and 99). +• Colin Rutherford: Committee Chair +• Alastair Miller +• Charlie Parker +• Karen Miller (appointed to the Committee on 30 May 2022) +How the Committee operates +• Each Committee member is independent and has broad commercial experience +• Colin Rutherford has significant, recent and relevant financial experience and +was previously the Chairman of the Audit Committee of Mitchells & Butlers plc +• Alastair Miller is a Chartered Accountant and was previously the Chief Financial Officer +of New Look Group and has significant, recent and relevant financial experience +• The Committee as a whole has competence relevant to the sector +• During the year the Audit Committee held five meetings +• The Chief Financial Officer and the Group’s external auditors are invited to attend +the Committee meetings. +113NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_116.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_116.txt new file mode 100644 index 0000000000000000000000000000000000000000..48e1cd7a9fabc9007903554b829e9b7a53574d62 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_116.txt @@ -0,0 +1,96 @@ +FY23 Audit Committee activity +May +• Meeting with the Property Valuers +▼ +May +• External Auditors’ Report to the Committeee +• Internal Controls Review +• Gifts and Hospitality register +• Going Concern assessment +• Viability statement assessment +• Risk Review and Principal Risks +• ESG achievements +• Preliminary results +• Fair, Balanced and Understandable review +• Review Annual Report for recommendation to the Board +• Draft Audit Committee Report in Annual Report +• Meeting with External Auditors without management present +• Re-appointment of External Auditors recommendation. +▼ +November +• Meeting with the Property Valuers +▼ +November +• Going Concern Review – report actions and outcome +• External Auditor’s Plan +• External Auditor’s Report to the Committee +• Internal controls – updates from third parties +• Review of Principal Risks +• Half year results +• Meeting with External Auditors without management present +▼ +February +• External Auditor Audit Plan Update +• Risk Review +• Consider requirement for an internal audit function +• Review Whisleblowing +• Auditor Effectiveness +• Annual Review of Terms of Reference +Relationship with the auditors +The Committee has primary responsibility for managing the +relationship with the external auditors, including assessing their +performance, effectiveness and independence annually and +recommending to the Board their reappointment or removal. +PricewaterhouseCoopers LLP (PwC) were appointed as the Group’s +external auditors in 2019. The Committee keeps under review the +need for future tenders in accordance with current regulations and +subject to the annual assessment of the auditor’s effectiveness and +independence. +Chris Burns is the PwC lead audit partner and, in-line with the policy +on lead audit rotation, he is expected to rotate off the audit ahead of +the 2025 audit. +During the year, the members of the Committee met twice with +representatives from PwC without management present, to ensure +that there are no issues in the relationship between management and +the external auditors which it should address. There were none. +External auditor +The Committee considers the nature, scope and results of the +external auditors’ work and reviews, develops and implements a +policy on the supply of any non-audit services that are to be provided +by the external auditors. It receives and reviews reports from the +Group’s external auditors relating to the Group’s Annual Report and +Accounts and the external audit process. +In respect of the audit for the financial year ended 31 March 2023, +PwC presented their Audit plan (prepared in consultation with +management) to the Committee. The Audit plan included an +assessment of audit risks, audit scope, independence, the terms +of engagement, fees and robust testing procedures. +The Committee approved the implementation of the plan following +discussions with both PwC and management. +Audit and non-audit fees +Audit fees for the financial year ended 31 March 2023 were £499k. +The Company has a non-audit services policy in place which limits +PwC to working on the audit or such other matters where their +expertise as the Company’s auditor makes them the logical choice +for the work. This is to preserve their independence and objectivity. +The Company paid £95k in non-audit fees to PwC for the financial +year ended 31 March 2023. The non-audit fees relate solely to +PwC’s review of the interim results for the six months to +30 September 2022. +Effectiveness and independence +The Chair of the Committee speaks regularly to the external audit +partner to ascertain if there are any concerns, to discuss the audit +reports and to ensure that the external auditors have received the +support and information requested from management. +In accordance with the guidance set out in the Financial Reporting +Council’s ‘Practice aid for audit committees’, the assessment of the +external audit has not been a separate compliance exercise, or an +annual one-off exercise, but rather it has formed an integral part of +the Committee’s activities. This has allowed the Audit Committee to +form its own view on audit quality and on the effectiveness of the +external audit process, based on the evidence it has obtained +throughout the year. +Audit Committee Report continued +114 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance +The secret animal #5 is a "wolf". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_117.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_117.txt new file mode 100644 index 0000000000000000000000000000000000000000..6d659d0222afd33669e87953bbf8e5077f3f513c --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_117.txt @@ -0,0 +1,49 @@ +Having regard to these matters the Committee has considered the effectiveness of the external audit process and feels that the external +auditors have demonstrated professional scepticism and challenged management’s assumptions where necessary. +The Audit Committee is satisfied with the scope of PwC’s work, and that PwC continues to be independent and objective. The Committee is +therefore pleased to recommend that PwC be re-appointed as the Group’s external auditors at the 2023 AGM. +Key judgements and estimates +The Committee reviewed the external reporting of the Group including the interim review, quarterly announcements and the Annual Report. +In assessing the Annual Report, the Committee considered the key judgements and estimates. +The significant issue considered by the Committee in respect of the year ended 31 March 2023, which contained a significant degree of +estimation uncertainty, is set out in the table below. +Significant issue How the issue was addressed +Valuation of properties +Changes in key estimates can have a significant impact on the +valuation of properties. The Group has a property portfolio +recognised on its Consolidated Balance Sheet valued by external +valuers at £551.5 million at 31 March 2023. +The Committee and management met with Colliers, Knight Frank and +Kroll (previously Duff and Phelps) (the Group’s external valuers) on +several occasions to discuss the valuation of the assets and +understand the process that was followed, the key estimates used +and to ensure a robust and independent valuation had taken place. +The meetings were productive and management and the Committee +have confirmed that they continue to adopt the valuations as being +the fair valuation of the properties as at the reporting date. In addition +the external auditors have performed additional audit procedures +over the valuer judgements and estimates and presented challenges +which were reported to and discussed with the Committee. +Sources of evidence obtained and observations dring the year: +By referring to the FRC’s Practice aid on audit quality. The Committee has looked to this practice aid for guidance and has +ensured that assessment of the external audit is a continuing and +integral part of the Committee’s activities. +Observations of, and interactions with, the external auditors. The Committee has met with the external audit partner without +management at least twice during the year and has noted that PwC +was performing well and the working relationship was good. +The audit plan, the audit findings and the external auditors’ report. The Committee scrutinises these documents and reviews them +carefully at meetings and by doing so has been able to assess the +external auditors’ ability to explain in clear terms what work they +performed in key areas and also assess whether the description used +is consistent with what they communicated to the Committee at the +audit planning stage. The Committee has also regularly challenged +these reports in the meetings. +Input from those subject to the external audit, including a detailed +questionnaire completed by the finance team. +The Committee has requested the insights from the Chief Financial +Officer and the Finance team during the external audit process. This +year the Finance team completed a detailed questionnaire about the +audit process and the working relationship with the external auditors. +This questionnaire was considered in detail by the Committee in one +of its meetings. +115NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_118.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_118.txt new file mode 100644 index 0000000000000000000000000000000000000000..1ae65392d6b35c1da6516127d89a99daca4266ed --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_118.txt @@ -0,0 +1,67 @@ +The Board is ultimately responsible for the Group’s system +of internal controls and risk management and discharges its +duties in this area by: +• holding regular Board meetings to consider the matters +reserved for its consideration; +• receiving regular management reports which provide an +assessment of key risks and controls; +• scheduling regular Board reviews of strategy including +reviews of the material risks and uncertainties (including +emerging risks) facing the business; +• ensuring there is a clear organisational structure with defined +responsibilities and levels of authority; +• ensuring there are documented policies and procedures in +place and reviewing these policies and procedures regularly; +• reviewing regular reports containing detailed information +regarding financial performance, rolling forecasts, actual and +forecast covenant compliance, cashflows and financial and +non-financial KPIs; and +• visiting the assets to provide context to the reports received. +Risk management and internal controls +Internal control structure +The Board oversees the Group’s risk management and internal +controls and determines the Group’s risk appetite. The Board has, +however, delegated responsibility for review of the risk +management methodology and the effectiveness of +internal controls to the Audit Committee. +The Group’s system of internal controls includes financial, operational +and compliance controls and risk management. Policies and +procedures, including clearly defined levels of delegated authority, +have been communicated throughout the Group. Internal controls +have been implemented in respect of the key operational and +financial processes of the business. These policies are designed to +ensure the accuracy and reliability of financial reporting and govern +the preparation of the Financial Statements. During the year a +number of follow up internal audit reviews have been commissioned +to provide the Committee with additional comfort that the Group’s +system of internal controls remains fit for purpose and robust. +The process by which the Audit Committee has monitored and +reviewed the effectiveness of the system of internal controls and risk +management during the year has included: +• ongoing analysis and review of the Group’s risk register; +• overseeing further ’deep-dive’ discussions of the Group’s risk +register to reassess each risk on the register and its +risk scoring; +• further ‘deep-dive’ audits on specific risks; this year it was +cyber security and cash controls; +• reviewing the assessment of key risks, the process of +reporting these risks and associated mitigating controls, +with particular emphasis on emerging risks; and +• updates from the ExCo’s quarterly detailed assessment of +the risk register. +The effectiveness of the Company’s risk management and internal +control systems is reviewed annually and was last reviewed by the +Committee in May 2023. The review concluded that: +• the systems established by management to identify, assess +and manage risks, including emerging risks are effective; and +• the assurance on risk management and internal control is +sufficient to enable the Committee and Board to satisfy +themselves that they are operating effectively. +The Committee is satisfied that the risk management framework is +effective and did not identify any failing in the control systems. +Further details of the Company’s risk management process, together +with the principal risks, can be found in the Principal Risks and +Uncertainties section. +Audit Committee Report continued +116 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_119.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_119.txt new file mode 100644 index 0000000000000000000000000000000000000000..64f8543207c6330a207ffab9fd0fba6334e987b5 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_119.txt @@ -0,0 +1,96 @@ +Internal audit function +The Group does not have an internal audit team. The need for this is +reviewed annually by the Committee. Due to the relative lack of +complexity and the outsourcing of the majority of the day-to-day +operational functions, the Committee continues to be satisfied that +there is no requirement for such an in-house team. The Committee +does however look to third-parties to provide an internal audit review +function. This year the Committee commissioned the following follow +up internal audit reviews: +Cyber security +Cyber security was a new principal risk in 2021. A cyber event can +affect any company and the number of such events has increased +significantly in the UK particularly with more staff working from home. +To address this risk and ensure the Group’s systems were properly +protected, Bright Cyber were requested to undertake a review of +the Group’s IT security and systems. Last year Bright Cyber carried +out a review of the Group Head office systems and found the IT +systems were secure and fit for purpose. During FY23 Bright Cyber +were requested to undertake a review of Cyber Security and IT +Systems in a sample of our shopping centres. There were a number +of areas where Bright Cyber have recommended improvements +which have already been implemented or will be actioned during +the coming months. +Cash controls +As part of the internal audit plan in FY22 BDO were requested to +scope and carry out a review to provide assurance over the design +and effectiveness of the key controls to manage cash collection and +bank accounts within the Group. BDO’s review highlighted that +generally there was a sound system of internal control designed to +achieve system objectives and there were a number of areas of good +practice with some exceptions. BDO were therefore able to provide +moderate assurance over both the design and the operational +effectiveness of the systems the Group had in place. Four low to +medium risk recommendations for improvement were made by the +BDO review. BDO were therefore invited back in FY23 to assess the +systems that had been put in place to address these four low to +medium risk recommendations for improvement made at their +previous review. BDO confirmed that their recommendations had +been incorporated into the systems. +Whistleblowing Policy +The Committee conducts an annual review of the Group’s +Whistleblowing Policy to ensure it remains up to date and relevant +and reports its findings to the Board. Training on whistleblowing is +provided to staff annually to capture new staff and to remind existing +staff of the procedures. The Committee provides feedback to the +Board on the Whistleblowing Policy and procedures and +effectiveness of the policy at least every six months. There have +never been any concerns raised through the whistleblowing process +or through any other process to the Committee. +Other compliance policies +The Committee reviews the Gifts and Hospitality register at least +twice a year. During the year a Conflicts of Interest Policy was +approved by the Committee and recommended for approval to the +Board. The Conflicts of Interest register will also now be regularly +reviewed by the Committee. +Statement of compliance +The Company is not a constituent of the FTSE 350, however the +Company confirms on a voluntary basis that it has complied with +terms of The Statutory Audit Services for Large Companies Market +Investigation (Mandatory User of Competitive Tender Processes and +Audit Committee Responsibilities) Order 2014 (the “Order”) +throughout the year. In addition to requiring mandatory audit +re-tendering at least every ten years for FTSE 350 companies, the +Order provides that only the Audit Committee, acting collectively or +through its Chair, and for and on behalf of the Board, is permitted: +• to the extent permissible in law and regulation, to negotiate and +agree the statutory audit fee and the scope of the statutory audit; +• to initiate and supervise a competitive tender process; +• to make recommendations to the Directors as to the auditor +appointment pursuant to a competitive tender process; +• to influence the appointment of the audit engagement partner; and +• to authorise an auditor to provide any non-audit services to the +Group, prior to the commencement of those non-audit services. +Viability statement and going concern +The Committee has reviewed the basis for the Company’s viability +Statement that is drafted with reference to the financial forecasts for +the next three years. This period of assessment is aligned to +performance measurement and management remuneration and, in +the opinion of the Committee, this period of assessment strikes the +optimal balance of allowing the impact of strategic decisions to be +modelled while maintaining the accuracy of underlying forecast +inputs. The Committee places additional scrutiny on the assumptions +used in the forecasts to ensure they are appropriate. The Committee +provides advice to the Board on the Viability Statement. +The Committee ensured sufficient review was undertaken of the +adequacy of the financial arrangements, cash flow forecasts and +lender covenant compliance. The Committee further tested the +Group’s performance against its stated strategy and its future plans. +Accordingly, the Committee recommended to the Board that the +statement be approved. +The Committee further focused on the appropriateness of adopting +the going concern basis in preparing the Group’s financial statements +for the year ended 31 March 2023 and satisfied itself that the going +concern basis of presentation of the financial statements and the +related disclosure is appropriate. +117NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_12.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_12.txt new file mode 100644 index 0000000000000000000000000000000000000000..beb9d47b634bbba2a2a70ffb9732761430091b84 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_12.txt @@ -0,0 +1,124 @@ +Overall, our long-term leasing transactions had a weighted average +lease expiry (WALE) of 8.2 years, up from 6.4 years in FY22, with +Retail Parks at 12.0 years and Core Shopping Centres at 6.9 years. +In terms of occupier incentives, we have seen a marked improvement +in rent-free periods granted in the period compared to FY21 and +FY20. For long-term leasing transactions, the average rent-free +period was just 2.8 months with many occupiers receiving no +rent-free period. +The demand for space that we saw in our portfolio during the year +remained broadly based with 67% of the space leased to Grocery, +Discount, F&B, Health & Beauty and Value Fashion. +Well Positioned Portfolio +As at 31 March 2023, Retail Parks accounted for 28% of our portfolio, +totalling 14 assets. It has been another positive year for our Retail Park +Portfolio which at year end was 98% occupied with a retention rate +of 100%. We have continued to see strong occupational and investor +demand for our Retail Parks which are predominately located adjacent +to major supermarkets, benefit from free surface car parking and are +supportive of retailers’ omnichannel strategies. As such we had a good +year of leasing with transactions completed 0.8% ahead of valuer ERV. +Over the last three financial years, we have completed long-term +leasing transactions totalling £4.5 million of annualised rent across our +Retail Parks which versus the previous passing rent equates to a CAGR +of +0.6% per annum over the average previous lease period of 12.3 +years. Our Retail Parks delivered a total return of 4.8%, outperforming +the MSCI retail warehouse index by +1,170 basis points, which recorded +a -6.8% total return. +As at 31 March 2023, our Core Shopping Centre portfolio represented +37% of our total portfolio value and comprises 14 Core Shopping Centres +at the heart of local communities providing a range of essential goods +and services with an occupancy of 98% and retention rate of 90%. +The consistent occupational demand is reflected in the positive +leasing performance during the year with long-term deals transacted +2.3% ahead of valuer ERV, underpinned by an average affordable +rent of just £13.18 per square foot and £39,000 per annum. Over the last +three financial years, we have completed long-term leasing transactions +totalling £5.5 million of annualised rent, which compared to the previous +passing rent, equates to a CAGR of only -0.8% per annum over the +average previous lease period of 9.9 years. Our Core Shopping Centres +delivered a total return of 10.3%, outperforming the MSCI shopping +centres index by +1,540 basis points, which recorded a -5.1% total return. +We have three Regeneration assets, representing 23% of the +total portfolio value, for which we have planning consent for: +187 residential units, over 850 residential units at the pre-planning +application stage and a further 350 residential units in the masterplan +stage for phase one. None of these projects will be built-out by +NewRiver as our intention is to deliver value either through sale or +by partnering with residential developers, once planning consents +are secured. Currently, we are not exposed to material contractual +capital expenditure commitments but in order to maximise value, +some modest capital expenditure will be required over the next +two years. Whilst we advance our regeneration proposals, we have +maintained a high occupancy at 97% whilst at the same time building +flexibility into the leases to deliver future vacant possession. As such +the leasing deals completed within our Regeneration portfolio were +transacted at a modest -3.9% below valuer ERVs. +Our Work Out portfolio represents 11% of our portfolio and comprises +nine assets which we intend to dispose of or complete turnaround +strategies on. Since our Half Year results, we have completed the +disposals of two shopping centres in Wakefield and Darlington, with +the remaining sales to be completed in FY24; those assets subject to a +turnaround strategy are supported by further investment by the end of +FY24. In the interim, occupancy and retention rates for our Work Out +assets remain high at 93% and 89% respectively and leasing deals +completed during the year were transacted at -2.1% below valuer ERV. +In respect of capital and total returns, our Work Out portfolio has +outperformed the MSCI shopping centres index by +10 and +590 +basis points respectively. +PLATFORM +Growing Capital Partnerships +Capital Partnerships are an important component of our strategy to +deliver earnings growth in a capital light way. We were delighted in +November 2022 to secure a high-profile mandate from M&G Real +Estate to manage a large retail portfolio comprising 16 retail parks +and a shopping centre located in the South East of England. After our +appointment in November 2022, the mandate was extended to include +a further shopping centre in the South East post year end in April 2023. +Currently, we have three key Capital Partnerships: in the public sector +with Canterbury City Council; in the private equity sector with BRAVO; +and now in the institutional sector with M&G Real Estate. Currently, +we asset manage 19 retail parks and five shopping centres with a +total value in excess of £500 million and annualised rent of over +£50 million. +The expansion and breadth of our Capital Partnerships is a clear +recognition of the need for a best-in-class platform to extract +performance in the highly operational retail sector. We believe that +we have a significant opportunity to deliver further earnings growth +through our Capital Partnership activities. +Prudent Capital Allocation +Capital allocation during the year has been focused on investing +in our portfolio with tightly controlled discipline given the macro- +economic uncertainty. Total investment in FY23 was £4.0 million of +which 57% was allocated to our retail park portfolio, with the largest +project being the construction of a new Aldi store in Dewsbury which +accounted for 23% of our total portfolio investment. +We invested £0.6 million in our Core Shopping Centres, the key +project being the funding of our planning application for a new +food store in Market Deeping which was unanimously approved +by the Council post year end. Our Regeneration portfolio received +£0.7 million of investment principally to advance our forthcoming +planning application in Grays for an 850+ unit residential-led major +town centre regeneration. +Committed progress to ESG +We take our role as the custodians of assets within the community +very seriously and part of that responsibility is helping to protect +the long-term sustainability of the environment that they sit within, +and we are pleased to report great progress in the delivery of our +committed ESG Strategy. +During the year, the quality of the Management and Governance of +our business was recognised as we ranked first place in the GRESB +“Management” module out of a total 901 participants across Europe. +This recognition is due to the fastidious work from our team in +embedding our ESG objectives across the business at both the +corporate and asset level including developing a supplier ESG +performance evaluation process and formalising a quarterly ESG +performance review process for our Property team. +Our ESG activities this year have resulted in achieving our target +GRESB score of 70/100 for the “Standing Portfolio” Benchmark, scoring +90/100 for the GRESB “Development” benchmark and being awarded +an “A” alignment in GRESB’s independent TCFD assessment. +10 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report10 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Chief Executive’s Review continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_120.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_120.txt new file mode 100644 index 0000000000000000000000000000000000000000..4ede18526a1e268f8bb3be810acc5587dbd7be28 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_120.txt @@ -0,0 +1,32 @@ +Experienced team +Senior review +• a core experienced team is responsible for the co-ordination +of submissions, verification, review and consistency +• the narrative sections are drafted by the members of the team with +specific responsibility for each area, such as the Chairman, the CEO, +the CFO, Sustainability Manager, Director of Communications and +Investor Relations, and the Company Secretary +As narrative sections are prepared they are circulated to Board and ExCo members to review and comment +Staff review +Controls and confirmation +• the Committee satisfies itself that the controls over the accuracy +and consistency of information presented in the Annual Report +are robust and that the information is presented fairly (including +the calculations and use of alternative performance measures) +• the Committee confirms to the Board that the processes +and controls around the preparation of the Annual Report +are appropriate, allowing the Board to make the “fair, +balanced and understandable” statement in the Directors’ +Responsibilities Statement +Committee oversight and review +The draft Annual Report is given to other staff members not involved in the drafting +process to read and provide feedback on its fairness, balance and understandability +The Committee reviews the Annual Report on behalf of the Board, taking into account the comments made +by the Board, reports from management and reports issued by PwC and makes recommendations to the Board +Fair, balanced and understandable assessment +The Directors are required to confirm that they consider, taken as a whole, that the Annual Report is fair, balanced and understandable +and that it provides the information necessary for shareholders to assess the Group’s position and performance, business model and strategy. +To ensure this is the case the following process is in place: +Audit Committee Report continued +118 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_121.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_121.txt new file mode 100644 index 0000000000000000000000000000000000000000..6d2c7ce388015709f8e6cc2ffcc0df78a110228f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_121.txt @@ -0,0 +1,61 @@ +Remuneration Committee Report +Dear Shareholders +On behalf of the Board, I am pleased to present the Remuneration Committee Report for the +financial year ended 31 March 2023. In this statement I have summarised the link between +remuneration and performance and our decisions on remuneration for FY23. I have also +summarised the proposed changes to the Directors’ Remuneration Policy for FY24-FY26. +FY23 has been a successful year for NewRiver despite the wider economic and geopolitical +uncertainties. Our community assets have proven to be resilient throughout this period and have +under-pinned our performance for the year. The Committee has had regular updates on workforce +pay and benefits throughout this year and the health and wellbeing of our staff has remained a key +priority. We are ever mindful of the inflationary pressures which are driving up the cost of living and +have recognised this in pay awards for our staff for FY24. +Remuneration Policy +Our Remuneration Policy was approved by shareholders in July 2020 and is due for renewal at our +2023 AGM. Our current policy has served the Company well over the past three years, enabling us +to be flexible in the payments to Executive Directors, and to recruit a new CFO. It has provided a +good overall link between pay and performance. On this basis, our review concluded that only a few +minor amendments were necessary to align to market best practice. A summary of the key changes +to the policy are set out on page 122. +Implementation of the Policy in FY23 +Base salary +As reported in the FY22 Remuneration Report, base salaries remained unchanged during FY23 +for both the Executive Directors and the members of ExCo. The wider workforce received salary +increases that took into account inflation and market competitiveness. +Annual bonus +The FY23 annual bonus was based on Total Return (25%), Earnings yield (25%), LTV (10%), TAR +Return (15%) and strategic objectives including ESG targets (25%). Operational performance over +the year was excellent, which was reflected in the Total Return, Earnings Yield and LTV measures +all exceeding the stretch performance targets. There was also strong performance against the non +financial strategic targets. The only aspect where we failed to achieve the target range was in +relation to TAR, where our performance, alongside that of the entire sector, was impacted by the +significant property devaluations in the second half of 2022. The resultant out-turn was 82.5% of +maximum for Allan Lockhart and Will Hobman. The Committee is comfortable that the formulaic +bonus outcome reflects the wider business performance of the Company. 30% of the bonus will +be deferred in shares for two years. +Long-term incentive plan +The FY21 LTIP Awards will vest to the extent that the relative TAR (50%) and Total Shareholder +Return (50%) performance targets are met. The relative TAR targets were assessed against +performance to 31 March 2023. As the minimum hurdle requirement was not met, this element of +the award will lapse. For the TSR element, performance is assessed for a period of three years from +the date of grant. Therefore, the vesting level under the TSR element cannot be ascertained until +August 2023. Based on a recent assessment of the Company’s TSR, the TSR element is expected +to vest in full. On this basis, the total estimated vesting for this award is 50% of maximum. The +Committee considered wider business performance over the three-year performance period and +is comfortable that the formulaic vesting outcome is appropriate. +In addition to looking at our performance in the round, the Committee considered whether the +share price increase from grant represented a windfall gain. Over the period since the grant of the +FY21 award, our share price has increased from 63p to an average share price over the first quarter +of 2023 of 88.27p. Whilst being cognisant of the guidance from the Investment Association on +potential windfall gains from FY21 awards granted during the pandemic, we are not scaling back +the award on vesting because: +• The FY21 Award was scaled back by one third at grant (from 100% of salary to 67% of salary) to +ensure that the Executives did not benefit from a windfall gain. +• Relative TSR performance against the sector has been strong. Based on the TSR performance +to 31 January 2023, our TSR has exceeded the upper quartile TSR performance of other UK +REITs (62% vs 14%). +On this basis, the Committee decided not to exercise any discretion to reduce the overall +vesting outcome. +Remuneration Committee Report +119NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret animal #2 is a "panda". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_122.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_122.txt new file mode 100644 index 0000000000000000000000000000000000000000..87e321980eb7bda939a272e6e0838e5bdcc5deea --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_122.txt @@ -0,0 +1,77 @@ +Other considerations during the year +Wider workforce engagement +During the year, the Committee had oversight of the reward and +compensation packages that operate across the Company, which are +considered competitive. I am the appointed designated Non- +Executive Director who has the responsibility of ensuring that the +Board successfully engages with the workforce. As a result of being a +small team there is naturally proximity between the Board and the +workforce which makes it easier for the Board to engage with staff +directly. I attend staff forums to ensure that there is an opportunity for +staff to raise questions or concerns directly with myself. We also use +our appraisal process to explain and discuss with employees how the +policy for Executive Directors aligns with the pay and conditions of +the workforce. Finally, NEDs have also engaged with employees in +the regional operations and found this to be particularly useful. The +executive remuneration policy and its implementation were not +raised as material issues during the year. Therefore, no amendments +were required to the remuneration policy or its proposed +implementation as a result of this engagement. +Shareholder engagement +Ahead of the 2023 AGM, we engaged with our largest investors to +understand their views on our proposed new policy and the proposed +implementation in FY24. Based on the feedback received from our +engagement, investors were supportive of the new policy and no +changes were required as a consequence of the investor feedback. +Implementation of the Policy in FY24 +The implementation of the Remuneration Policy for FY24 is outlined +on pages 135 to 136. The Committee considered how remuneration +should be implemented for FY24. Part of this process was reviewing +current practice against both market and best practice, wider +workforce remuneration and pay ratios. The outcome of the review +was that our current approach remains appropriate.The key decisions +made by the Committee in relation to FY24 include: +Base salary: During the year the Committee reviewed the salary +increases for the wider workforce, taking into account high inflation +and the increase in cost of living. As a result, the wider workforce +received an average increase of 5%. The Committee reviewed the +base salary levels for Executive Directors and determined that the +salaries should be increased by 3%. This increase was materially +below the average workforce increase and also recognised that the +CEO's salary had not increased for several years. +Pensions: The Company currently contributes 15% of base salary for +Allan Lockhart. This will reduce at the end of forthcoming AGM to 4% +of salary, the rate applying to the workforce. Will Hobman’s Company +pension contributions are also 4% of base salary. +Annual Bonus: Executive Directors will have the opportunity to earn a +bonus up to a normal maximum of 125% of salary. In line with FY23, +75% of the bonus will be based on corporate and financial measures, +including Total Return, Earnings Yield, LTV and absolute growth in +Total Accounting Return (TAR). 25% will remain based on strategic +measures (including measurable ESG objectives consistent with the +Company’s ESG commitments and strategy). 30% of any bonus paid +will be deferred into shares for two years. +Long-term incentives: Grant levels will be 100% of base salary. In line +with FY23 grants, performance will be assessed against relative TSR and +relative TAR vs a peer group of UK REITs. Awards must be held by +Executive Directors for a further two years after vesting. +Closing remarks +We believe that the operation of our Remuneration Policy recognises +the experience of shareholders, employees and other stakeholders. +Bonuses have been awarded to the wider team to ensure alignment +with the level of bonuses awarded to the Executive Directors. In +recognition of the inflationary pressures on the wider workforce, staff +have received pay increases at higher percentage levels than the +Executive Directors and Members of the ExCo. +We welcome feedback and if shareholders have any questions about +remuneration generally, or the contents of the report, I can be +contacted through our investor relations email at info@nrr.co.uk. +My fellow Directors and I intend to attend the AGM and we would be +pleased to answer any questions you may have about the +Committee’s work. +Alastair Miller +Committee Chair +14 June 2023 +Remuneration Committee Report continued +120 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_123.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_123.txt new file mode 100644 index 0000000000000000000000000000000000000000..8387658b5f41fbe380fd5baff745282c6b6895e1 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_123.txt @@ -0,0 +1,81 @@ +Remuneration at a Glance +FY23 Annual Bonus Performance +LTV +TAR Return +100% +0% +100% +100% +90% +90% +CorporateFinancial Strategic +Corporate and financial measures (75% weighting) +Measure +Total return vs +IPD All Retail +Earnings yield (UFFO) +Director +Achievement (% of max) +Achievement (% of max) +Strategic measures (25% weighting) +Allan Lockhart +Will Hobman +Executive Pay in FY22/23 +Total remuneration (£) +350k +700k +1.05m +1.4m +0k +Allan +Lockhart +Will +Hobman1 +£1,295,657 +£674,918 +£984,462 +£399,453 +Salary +Pension +Benefits +Annual Bonus +LTIP +2022202320222023 +FY21-23 Performance Share Plan +100% +0% +Achievement (% of max) +50% +Measure +Relative TSR vs +Peer Group +Relative Total Accounting +Return vs Peer Group +Total +PSP +Implementation of Policy in FY24 +Base Salaries Allan Lockhart: £484,100 +Will Hobman: £334,750 +Benefits No change +Pension Allan Lockhart: 15% of salary to reduce +at AGM 2023 to 4% of salary +Will Hobman: 4% of salary +Annual Bonus Maximum opportunity is 125% of salary +Performance conditions: +75% Corporate Targets +25% individual strategic objectives +30% deferred into shares for two years +Long Term +Incentive Plan +Grant levels at 100% of salary +Performance conditions: +Relative TSR (50%) +Relative TAR (50%) +Two-year post-vesting holding +period applies +Shareholding +requirements +200% of salary1. Remuneration was pro-rated in 2022 because Will was appointed +during FY22. No value for the LTIP award vesting is included in 2023 +as the award relates to his employment below board level. +121NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_124.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_124.txt new file mode 100644 index 0000000000000000000000000000000000000000..a35a96fc96da8b8b77c7b99fafe5d80e3449d40b --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_124.txt @@ -0,0 +1,61 @@ +Remuneration Committee Report continued +Remuneration Policy +In accordance with the remuneration reporting regulations, the +remuneration policy as set out below is intended to apply, subject to +shareholder approval at the 2023 AGM to be held on 26 July 2023, +for a period of three years from that date. +Following a detailed review of the remuneration policy and +shareholder engagement, the following changes are proposed. +These are limited to modest amendments which do not substantively +alter the previous policy: +Pension +The policy has been updated to reflect that Executive Directors may +receive a pension contribution in line with the contribution available +to the wider workforce (currently 4% of salary). The CEO’s pension +will reduce from 15% of salary to 4% of salary from the date of the +2023 AGM. +Performance Share Plan +The policy wording in respect of performance conditions has been +broadened so that non-financial measures may be incorporated +alongside financial and stock market based measures. This will +provide greater flexibility to operate the policy in line with the +evolving business strategy including, potentially, the use of ESG +based measures. We have also flexibility for the dividend equivalent +calculation to take into account the holding period (where applicable) +and not just up to the point of vesting. +Shareholding guidelines +The post-employment shareholding guideline has been updated to +align with the IA guidelines and market best practice such that +Executive Directors will be required to retain 200% of salary for two +years post-cessation of employment (or the actual shareholding, if +lower). Previously the requirement reduced to 100% of salary for the +second year. +In addition, we have made some minor wording changes to the policy +to enhance clarity. +Decision making process for the determination, +review and implementation of the policy +When reviewing the remuneration policy, the Committee considers a +wide range of factors, including: +• The Company’s strategic priorities and KPIs and culture and values +• The remuneration policies and practices for the workforce and the +cascade of remuneration throughout the Company and where +practicable improving the consistency of the Executive Directors’ +remuneration policy with that of the workforce +• The latest guidance from our institutional shareholders, investor +representative bodies, regulators and statutory requirements +• The overall market competitiveness of the senior +executives’ packages +To manage any potential conflicts of interest, the Committee ensures +that no individual is involved in discussions regarding their own +remuneration arrangements. +The implementation of the Policy is considered annually by the +Committee for the year ahead in light of the strategic priorities +and the wider stakeholder experience, whilst incentive targets are +also reviewed to check if they remain appropriate or need to +be recalibrated. +In addition to the decision-making process set out above, the +Committee addressed the following factors when determining the +remuneration policy and practices, as recommend by the UK +Corporate Governance Code: +122 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_125.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_125.txt new file mode 100644 index 0000000000000000000000000000000000000000..ac7507d658cb63c7351e209ea7ee1de1ccc3486f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_125.txt @@ -0,0 +1,130 @@ +Principle Committee approach +Clarity +Remuneration arrangements should be transparent and +promote effective engagement with shareholders and +the workforce. +• As noted above there is a consistent approach taken, where possible, in +relation to the application of the remuneration policy throughout the Company. +For instance, all employees participate in an annual bonus plan and the PSP. +• We consult with employees to explain how the policy for Executive Directors +aligns with the pay and conditions of the workforce other than, for instance, +where there are more stringent requirements in the Executive Directors’ policy +for corporate governance reasons. +Simplicity +Remuneration structures should avoid complexity and their +rationale and operation should be easy to understand. +• The components of our Remuneration Policy are consistent throughout the +Company so they are simple to operate and communicate. +Risk +Remuneration arrangements should ensure reputational +and other risks from excessive rewards and behavioural +risks that can arise from target-based incentive plans are +identified and mitigated. +• We look carefully at the range of likely performance outcomes when setting +performance target ranges and use discretion where this leads to an +inappropriate pay outcome. +• Bonus deferral, holding periods on LTIP awards, shareholding requirement and +clawback and malus provisions all help to mitigate risk. +Predictability +The range of possible values of rewards to individual +directors and any other limits or discretions should +be identified and explained at the time of approving +the policy. +• Incentive plans are determined based on a proportion of base salary so there +is a sensible balance between fixed pay and performance-linked elements. +• There are provisions to override the formula driven outcome of incentive plans +and deferral and clawbacks to minimise the likelihood of a poor link between +reward and performance. +Proportionality +The link between individual awards, the delivery +of strategy and the long-term performance of the +company should be clear. Outcomes should not +reward poor performance. +• Incentive plans are determined based on a proportion of base salary so there +is a sensible balance between fixed pay and performance-linked elements. +• There are provisions to override the formula driven outcome of incentive plans +deferral and clawbacks to ensure that poor performance is not rewarded. +Alignment to culture +Incentive schemes should drive behaviours consistent +with company purpose, values and strategy. +• All staff are eligible for bonus plans which are approved by the Committee to +ensure consistency with Company purpose, values and the performance +measures are linked to the business strategy. +Remuneration Policy Table Executive Directors +Element +Purpose +& Link to Strategy Operation Maximum Performance Target +Fixed +Salary Market competitive +remuneration base +reflecting role, +responsibilities, skills +and experience +Normally reviewed annually, +effective 1 April, although salaries +may be reviewed more frequently +or at different times of the year if +the Committee determines this +is appropriate. +Salaries are set taking into account +the performance of the individual, the +responsibilities and size of the role, +salary increases across the Group +and market data for peer companies. +Paid in cash monthly. +There is no prescribed maximum. +Increases will typically be dependent +on the results of an annual review in +the context of the average increase +for the wider work force, inflation and +market data. +Increases will not normally be above +the level implemented across the +wider workforce. Increases may be +above this level, for example if there +is an increase in the scale, scope or +responsibility of the role. +Not applicable. +Pension To provide +competitive +post-retirement +benefits. +To assist with +recruitment and +retention. +The Executive Directors may +participate in the Company’s +defined contribution plan or receive +a cash supplement in lieu of pension +contributions. +A pension contribution is payable in +line with the pension available to the +workforce, currently 4% of salary. The +CEO’s pension contribution will reduce +from 15% of salary to this level from the +2023 AGM. +Not applicable. +Benefits To provide a +competitive and +cost-effective +benefits package. +To assist with +recruitment and +retention. +The Company provides a range of +non-pensionable benefits to Executive +Directors which may include medical +insurance, life assurance, permanent +health insurance, holiday and sick pay. +Other benefits such as relocation +allowances may be offered if +considered appropriate and +reasonable by the Committee. +Benefits are set at a level which the +Committee considers appropriate +when compared to the Company’s +listed real estate investment trust +peers. +There is no prescribed maximum. +Not applicable. +123NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_126.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_126.txt new file mode 100644 index 0000000000000000000000000000000000000000..3a39aaa50a07472f9c224a163d1adf557151c537 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_126.txt @@ -0,0 +1,163 @@ +Remuneration Committee Report continued +Executive Directors +Element +Purpose & +Link to Strategy Operation Maximum Performance Target +Variable +Bonus To incentivise +performance in +the reporting +year. Targets are +consistent with +the Group’s long +term strategy. +The deferral of a +proportion of the +bonus in shares +aligns directors’ +interests with +those of +shareholders and +to discourage +short term +decision making. +All measures and targets will be reviewed +and set annually by the Committee at the +beginning of the financial year and levels +of award are determined by the +Committee after the year end based on +achievement of performance against the +stipulated measures and targets. +The Committee retains an overriding +discretion to adjust pay-outs from +formulaic performance condition +outcomes to ensure that overall bonus +payments reflect its view of corporate +performance during the year and are fair +to both shareholders and participants. +30% of the bonus must be deferred into +shares for two years. +Vesting of the deferred shares will be +subject to continued employment. +The value of the bonus does not +contribute to the pensionable salary. +Clawback and malus provisions apply. +The maximum bonus is 125% +of salary. +On target performance would result in +a bonus payment of 50% of maximum +bonus. Threshold performance would +result in bonus payment of up to 25% +of maximum bonus. +All measures and +targets normally relate +to a financial year of +the Company and are +reviewed on an annual +basis. +At least 50% of +the bonus will be +subject to financial +performance +conditions. +Performance +Share Plan +To incentivise +and reward the +delivery of returns +to shareholders +and sustained +long-term +performance. +Aligns the +Executive +Directors’ +interests with +those of +shareholders. +Rewards and +helps retain/ +recruit executives. +Discretionary grant of nil-cost options or +conditional awards of shares. +Awards normally vest three years from the +date of award. +Vesting of awards is subject to +satisfaction of performance targets +normally measured over a three-year +period. +The Committee retains an overriding +discretion to adjust the vesting level from +formulaic performance condition +outcomes to ensure that the overall level +of vesting reflects its view of corporate +performance over the performance period +and is fair to both shareholders and +participants. +A holding period of two years will apply +following vesting before participants are +entitled to sell their shares. +Clawback and malus provisions apply as +described in the notes to this table. +The maximum award level permitted +under the 2016 PSP plan rules and this +policy is 200% of salary. The normal +annual award is 100% of salary for all +Executive Directors. +Awards would not be increased above +100% of base salary without prior +consultation with shareholders. +25% of the award is payable at +threshold performance. +Performance targets +will apply over the +performance period. +The Committee will +determine the +applicable +performance targets +and their weightings to +ensure they are +appropriate. +Performance +conditions may be +based on financial, +stock market based +and/or non-financial +measures (including +strategic and ESG +measures). A majority +of the award will be +based on financial and +stock market based +measures. +Shareholding +Requirement +To encourage +long-term share +ownership and +support alignment +of interests with +shareholders. +At least half of the net shares vested under +the deferred annual bonus and the LTIP +must be retained until the shareholding +requirement is met. +During employment, Executive +Directors must build up a shareholding +worth 200% of salary. +After employment, Executive Directors +will be required to retain the lower of +the shareholding requirement during +employment or actual shareholding at +cessation for two years. The Committee +has the discretion to relax this +requirement in exceptional +circumstances (e.g. serious ill-health). +Shares that have been purchased +voluntarily may be excluded from the +post-cessation shareholding +requirement. +Not applicable +124 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_127.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_127.txt new file mode 100644 index 0000000000000000000000000000000000000000..0fbb282ccc32472d651ef6c8dcad0e6ed0d31a46 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_127.txt @@ -0,0 +1,88 @@ +Chair and Non-Executive Directors +Element +Purpose +& Link to Strategy Operation Maximum Performance Target +Fees To provide +market competitive +director fees. +Annual fee for the Chair. +Annual base fee for the +Non-Executive Directors. +Additional fees are paid to Non-Executive +Directors for additional responsibilities +such as being the Senior Independent +Non-Executive Director or chairing a +Board Committee. +Fees are reviewed from time to time +taking into account time commitment, +responsibilities and fees paid by +companies of a similar size and +complexity. +Payable in cash. +Expenses incurred by Non-Executive +Directors in connection with the fulfilment +of their roles are reimbursed (including +any personal tax due on such expenses). +Fee increases are applied in line +with outcome of the review. +Not applicable. +Notes on the remuneration policy table +Dividend equivalents +Dividend equivalent shares will be added to unvested awards +under the 2016 DBP and the 2016 PSP on a reinvested basis, +although this can be calculated in an alternative manner at the +discretion of the Committee. Dividends will accrue from the date of +grant to the vesting date or, if applicable, the last day of the holding +period. +Performance measures +Each year the Committee selects the most appropriate performance +measures and targets for the annual bonus plan and LTIP. The +measures selected will be aligned with Company strategy and key +performance indicators and performance targets are set with the +aim of setting stretching targets which incentivise and reward +improved performance. +Malus and clawback +In the event of gross misconduct, or the material misstatement of +financial information, or if an error is discovered in the calculation +of any incentive plan payments, or where there has been an issue +in relation to the company’s reputation, or corporate failure, the +Committee has discretion to exercise malus and clawback provisions +in respect of all cash bonus and share awards. The Committee may +reduce the vesting of awards prior to vesting and/ or require the +repayment or reimbursement of awards which have already vested +and been exercised across all incentive plans. +The Committee may operate clawback on the terms stated above +during the 36 months following the payment date of the annual +bonus or vesting date of an award granted on the terms of the 2016 +PSP. +Discretion +The Committee may amend the remuneration policy to accommodate +minor changes for administrative or legislative purposes. +In relation to the operation of the incentive plans, the Committee has +certain discretions which include, but are not limited to, the following: +• selecting the participants in the plans; +• determining the timing of grants of awards and/or payments; +• determining the quantum of awards and/or payments (within the +limits set out in the remuneration policy); +• determining the extent of vesting based on the assessment +of performance; +• making the appropriate adjustments required in certain +circumstances (e.g. change of control or a capital reorganisation); +• determining “good” or “bad” leaver status for incentive plan +purposes and applying the appropriate treatment; +• determining the weighting, performance measures, and targets +for the annual bonus plan and the PSP from year to year; and +• if events occur that cause the Committee to determine that the +performance conditions and/or targets for the incentive plans are +unable to fulfil their original intended purpose, to adjust targets +and/or set different measures or weightings for the applicable +annual bonus and PSP awards. +Consideration of shareholders’ views +The Committee’s policy is to consult with major Shareholders in +respect of significant decisions on executive remuneration and has +done so regularly. +During the year the Committee consulted extensively in relation to +the proposed New Remuneration Policy and investor feedback +helped shape the proposals, particularly in relation to our approach to +executive pension provision. +125NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_128.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_128.txt new file mode 100644 index 0000000000000000000000000000000000000000..dc1ac4fa66099a9b1e2614b3b52ac231fe92c51f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_128.txt @@ -0,0 +1,120 @@ +Remuneration Committee Report continued +How wider employee pay was considered during +the policy review +The Committee considered carefully the pay and conditions in the +workforce generally, as part of its review of the Directors’ +remuneration policy. Alastair Miller as Remuneration Chair and also +the Non-Executive Director charged with staff engagement hosted a +staff forum to explain the Directors’ Remuneration Policy and how it +aligns with remuneration of the workforce and to take comments +from staff. All the Non-Executive Directors have visited a large range +of the assets during the year which has given them the opportunity to +meet with more junior staff and listen to their views. +The policy for Executive Directors is rolled out on a consistent basis +throughout the workforce. All staff participate in the Annual Bonus +Plan and Performance Share Plan and we have a consistent approach +in relation to benefits and pension, noting the CEO will be aligned +following the 2023 AGM. There are however some differences in the +Director’s Remuneration Policy compared to the policy for +employees. For example, the opportunity for the incentive plans +varies by seniority. +Service contracts and payments for loss of office +Executive Directors’ service contracts are terminable by either party +giving the other 12 months’ written notice. If notice is served by either +party, the Executive Director may continue to receive base salary, +benefits and pension for the duration of their notice period during +which time the Company may require the individual to fulfil their +current role or may place the individual on garden leave. The +Committee will seek to minimise the level of payments to a departing +Director, having regard to all circumstances, including the Company’s +contractual obligations to the Director, the reason for departure, and +the Company’s policy on mitigation. +The Company may elect to make a monthly payment of base salary, +plus an amount in lieu of benefits/pension contribution/equivalent or +just base salary, in lieu of notice. Any payments in lieu of notice would +be phased monthly and subject to offset against earnings elsewhere. +Reasonable outplacement and legal costs may be payable. +Where a Director may be entitled to pursue a claim against the +Company in respect of his/her statutory employment rights or any +other claim arising from the employment or its termination, the +Committee will be entitled to negotiate settlement terms with the +Director that the Committee considers to be reasonable in the +circumstances and is in the best interests of the Company, and to +enter into a settlement agreement with the Director. +In addition to the contractual provisions regarding payment on +termination set out above, the Group’s incentive plans and share +plans contain provisions relating to termination of employment. Good +leaver provisions relate to termination of office or employment by +reason of death, ill-health, injury, incapacity or disability of the award +holder, redundancy or sale or transfer out of the Group or the +Company or undertaking employing that employee, or any other +circumstances stipulated by the Committee at the date of award. +For any good leaver the approach in relation to the incentive plans +will be as follows: +Annual bonus: bonus may be payable at the normal time pro-rata for +the portion of the year worked. Outstanding deferred bonus awards +would be retained and would vest at the usual time. +PSP awards: awards would vest at the usual time subject to the +achievement of the performance conditions and would normally be +scaled back pro-rata for the extent of the vesting period completed at +cessation of employment (unless in exceptional circumstances the +committee determines that the award should not be scaled back). +The two year post vest holding period would usually continue to +apply. +If an Executive Director is not deemed to be a good leaver, all bonus +entitlements and LTIP awards would normally lapse. +Non-Executive Directors’ letters of appointment incorporate a notice +period of three months. +No payment for compensation for loss of office will be made to the +Chair or any Non-Executive Director other than where the Company +determines that fees for the notice period should be paid. +The details of the service contracts for Executive Directors and Letters +of Appointment for the Non-Executive directors are summarised below: + +Directors Date of Appointment +Expiry date of service agreement +of letter of appointment +Allan Lockhart 18 August 2016 12 month rolling contracts +Will Hobman 20 August 2021 +Margaret Ford 1 September 2017 3 month rolling contracts +Colin Rutherford 5 February 2019 +Dr Karen Miller 30 May 2022 +Charlie Parker 10 September 2020 +Alastair Miller 18 August 2016 +The service agreements are available to shareholders to view at the +Company’s Registered Office on request from the Company +Secretary and at the Annual General Meeting. +External directorships and memberships +Executive Directors may take up one external directorship, subject to +the prior approval of the Board. In considering the appointment, the +Board will consider whether the appointment will have an adverse +impact on the Director’s role within the Company and whether it will +be a conflict of interest. Fees earned may be retained by the Director. +At present, no Executive Director has an external directorship. +Executive Directors are encouraged to join, when invited, advisory +committees of industries and professional bodies directly related to +the Company’s business. This helps to keep the Company informed +of any future regulations or trends which may affect it in the future, as +well as providing the opportunity to influence future decision making. +Recruitment arrangements +The Committee will apply the same remuneration policy and +principles when setting the remuneration package for a new +Executive Director. The Committee will take into consideration all +relevant factors to ensure that pay arrangements are in the best +interests of the Company and its shareholders. +Ongoing benefits, pension provisions, annual bonus participation and +awards under both the DBP and the PSP will be in line with those +stated in the policy. In exceptional circumstances, the maximum level +of variable pay which may be awarded to a new Executive Director in +the first year of appointment under the policy will be 325% of salary +(i.e. 125% annual bonus plus 200% PSP award). +Different performance measures may be set for any initial awards +under the DBP and PSP after considering the responsibilities of the +individual, the point in the year that they joined and the rules of the +applicable plan. The rationale will be clearly explained in the Annual +Report following such recruitment. The level of bonus which may be +paid will be pro-rated to reflect the time in the year when the +Executive Director joins. +126 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance +The secret animal #4 is a "turtle". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_129.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_129.txt new file mode 100644 index 0000000000000000000000000000000000000000..32d45d89ee97b56e06354a5dbfaf809a91237d25 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_129.txt @@ -0,0 +1,61 @@ +The Committee will have discretion to make payments or awards to buy out incentive arrangements forfeited on leaving a previous employer, +i.e. over and above the approach outlined in the table above and may exercise the discretion available under Listing Rule 9.4.2R if necessary to +do so. In doing so, the Committee will match the fair value of the awards forfeited, taking account of the form, any applicable performance +conditions and the likelihood of those conditions being met and the proportion of the applicable vesting period remaining. +Where an Executive Director appointment is an internal candidate, the Committee will honour any pre-existing remuneration obligations or +outstanding variable pay arrangements that relate to the individual’s previous role. +Non-Executive directors will be recruited on the basis of a Letter of Appointment with a three month notice period. +Minimum On Target Maximum Maximum +with +Share Price +Increase +Minimum On Target Maximum Maximum +with +Share Price +Increase +Allan Lockhart Will Hobman +Total remuneration (£) +500k +1,000k +1,500k +2,000k +0k + £350k100.0% +31.9% +55.4% +30.0% +13.0% +26.1% +32.6% +28.3% +100.0% 54.5% 31.7% 27.6% +32.9% +26.3% +13.2% +38.0% +30.3% +32.5% +13.0% +37.4% +32.6% +12.7% +£526k £643k +£1,103k +£1,271k +£950k +£1,857k +£1,615k +Illustrations of the operation of the Remuneration Policy +Fixed Pay Annual Bonus LTIP LTIP value with 50% +share price growth +Minimum performance: • comprising the minimum remuneration receivable (being base salary, +pension and benefits received in FY23); +On target performance: • comprising fixed pay, annual bonus payment at 50% of the maximum +opportunity and long-term incentive awards vesting at 25% of +maximum opportunity; +Maximum performance: • comprising fixed pay, 100% of annual bonus and 100% vesting +of long-term incentive awards, and +Maximum performance with share price increase: • comprising fixed pay, 100% of annual bonus and 100% vesting +of long-term incentive awards with the value increased for share price +appreciation of 50%. +127NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_13.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_13.txt new file mode 100644 index 0000000000000000000000000000000000000000..36ed1d1f9712eb2545751eed1749b85d910a4a1d --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_13.txt @@ -0,0 +1,89 @@ +We also retained our ‘B’ Rating from CDP for our management of +climate-related issues as well as retaining our Gold Award in EPRA +Sustainability Best Practice Recommendations Awards, recognising +the excellence in the transparency and comparability of our +environmental, social and governance disclosures. +Our assets are typically easily accessible with short travel times, +supporting the wider climate and well-being agenda. We set our +pathway to Net Zero in 2019 and we continue to make great inroads +in implementing this. Achieving net-zero within the retail sector relies +upon mutual action by real estate owners and occupiers. The energy +consumed by our occupiers in our assets accounts for almost 90% of +our total carbon emissions. These are emissions over which we have +limited control, but we continue to develop our engagement activities +to support alignment between our climate ambitions and those of our +occupiers and so we are pleased to report that 57% of our lettable +floorspace is occupied by retailers that have already set emissions +reduction targets, with approximately 70% of that 57% part of the BRC +Climate Commitment to reduce carbon emissions to net zero by 2040. +As we reported last year, all of the energy supplied into our common +areas (malls and car parks) is already carbon neutral but this year we +also generated over 250,000 kWh of renewable electricity on-site at +our assets, maintained our “zero waste to landfill” policy and +delivered or secured contracts for EV charging infrastructure at +88% of our surface-level car parks. Given cost inflation headwinds, +it is also notable that the energy supplied into our malls is hedged +until Spring 2024, so we are not facing into price increases. +Finally, during the year we relocated our Head Office to a +BREEAM Excellent, Net-Zero building in London. We are committed +to continuing this great work and playing our part in helping protect +our planet and stakeholders for the long-term. . +MARKET +Outlook +Despite ongoing geopolitical tensions, elevated inflation and higher +interest rates, we are reassured with the improving occupational +demand for space in our resiliently positioned portfolio. Given our +current high occupancy rates for Retail Parks and Core Shopping +Centres at 98% and the benefit of the reduction of business rates for +our occupiers, we believe that the prospects for future rental growth +are now encouraging which should be supportive of future valuations. +For some time now, we have consistently expressed our confidence +in our portfolio positioning which is predominately focused on +essential goods and services. Our operating and financial results over +the last two years demonstrate the underlying resilience that we have +in our portfolio and in our platform, and we expect that to continue +into our new financial year. +We are in an excellent position with a strong balance sheet that is +not exposed in the medium term to rising interest rates, we have +capital available to deploy and opportunities to expand our Capital +Partnerships. We are therefore confident of our ability to deliver our +medium term objective of a consistent 10% total accounting return. +Allan Lockhart +Chief Executive Officer +14 June 2023 +OUR STRATEGY +We do this by delivering on our +business model: +This strategy is underpinned by clear +pillars of execution: +• Highly collaborative working relationships with all key partners +• A clear plan to help create thriving communities in the towns +where we are invested +• A committed sustainability strategy to minimise our impact on +the environment +• Creating opportunities for our team to develop their careers +• Operational efficiency and excellence +• Maintaining a strong balance sheet +• Delivering consistent and attractive risk-adjusted returns +Our strategy aims to deliver a reliable +and recurring income led 10% Total +Accounting Return and create value +for our stakeholders: +Local +Authorities +Shareholders +Environment +Occupiers +Capital +Partners +Team +Lenders +Communities +Underpinned by a committed ESG strategy +1. Disciplined +capital allocation +3. Flexible +balance sheet +2. Leveraging +our platform +11NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 11NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_130.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_130.txt new file mode 100644 index 0000000000000000000000000000000000000000..eef47e0609f31697fc2c371875afb615fb187b93 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_130.txt @@ -0,0 +1,96 @@ +Remuneration Committee Report continued +Remuneration Report +This section sets out how the Directors’ Remuneration Policy +was implemented during the financial year ended 31 March 2023. +Where stated, disclosures regarding Director’s remuneration have +been audited by the Company’s external auditors, PwC. This section, +together with the Chair’s Statement, is subject to an advisory vote at +the 2023 AGM. +Remuneration Committee +The Remuneration Committee is comprised of all the Non-Executive +Directors, including the Chair. Karen Miller was appointed to the Board on +30 May 2022 and joined the Committee on this date. The Remuneration +Committee meets at least four times a year, together with adhoc +meetings when required. It met four times during the year. A Board and +Committee attendance chart is contained in the Governance report on +page 106. FY23 Remuneration Committee activity +May +• Review outcome of Corporate and personal targets +for Exec Director bonuses +• Review and approve ExCo bonuses +• Consider DBS and PSP awards and targets +• FY23 targets and objectives +• Review Remuneration report +▼ +September +• Plan and discuss the proposed new Remuneration Policy +• Review Terms of Reference +▼ +November +• Consider the Remuneration Policy proposal +• Review the shareholder consultation process +▼ +March +• Consider shareholder feedback +• Report from Korn Ferry on developments in market +practice in remuneration +• Review wider workforce arrangements and pay policy +• FY24 targets and objectives +Committee members +Alastair Miller: Committee Chair +Margaret Ford +Colin Rutherford +Charlie Parker +Dr Karen Miller +The Chief Executive Officer and Chief Operating and People Officer +were invited to attend all or part of the meetings as relevant. These +individuals were not present when their own remuneration was +discussed. The Company Secretary acts as secretary to the Committee. +Role of the Remuneration Committee +The role of the Remuneration Committee is to establish a formal and +transparent procedure for developing and implementing the +Remuneration Policy. The Policy should have regard to the risk +appetite of the Company and Executive remuneration should be +aligned to the Company’s purpose and values and be clearly linked +to the successful delivery of the Company’s long-term strategy. The +Committee also reviews the remuneration of the Chair and senior +executives below Board level. Terms of reference for the +Remuneration Committee can be found on the Company’s website. +Other main responsibilities of the Committee are to: +• ensure that the Directors and executive management are provided +with appropriate incentives to encourage enhanced performance +and are, in a fair and responsible manner, rewarded for their +individual contributions to the success of the Company and to align +their interests with those of shareholders; +• attract, retain and motivate Directors and executive management +of the quality required to run the Company successfully without +paying more than is necessary, having regard to views of +shareholders and other stakeholders; +• review and have regard to workforce remuneration and related +policies and the alignment of incentives and rewards with culture, +taking these into account when setting remuneration policy for +Directors and especially when determining annual salary increases; +• consider and set the objectives, annual pay and targets for the +Directors and executive management; and +• review the operation of the Group’s share incentive schemes and +the granting and vesting of the schemes. +Any potential conflicts of interest are managed carefully. No Director +is present when their own remuneration is being discussed and +Committee papers are redacted where appropriate to avoid +individuals seeing proposals before they are discussed by the +Committee. Each meeting minutes whether there are any potential +conflicts for any members or attendees. +Statement of voting at the Annual General Meeting +The following table summarises the details of votes cast for and against the Directors’ remuneration policy and the Directors’ remuneration +report at the 2020 and 2022 AGM, along with the number of votes withheld. +Votes for % Votes against % +Total shares for +and against Votes withheld +That the Directors’ remuneration report be received and +approved (2022 AGM) +130,803,393 91.13 12,735,708 8.87 143,539,101 19,847 +That the Directors’ remuneration policy be received and +approved (2020 AGM) +160,581,406 94.19 9,902,752 5.81 170,484,158 89,031 +128 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_131.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_131.txt new file mode 100644 index 0000000000000000000000000000000000000000..f704cd8f89438b2dcf624b2f4be3eb1b5d896558 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_131.txt @@ -0,0 +1,54 @@ +Remuneration Committee advisor +The Committee keeps itself fully informed on developments and best practice in the field of remuneration and it seeks advice from external +advisers when appropriate. The Committee appoints its own independent remuneration advisers and appointed Korn Ferry in 2018 following a +competitive process. During the year the Committee continued to retain the services of Korn Ferry. Korn Ferry is a member of the Remuneration +Consultants Group and signatory to its Code of Conduct which can be found at www.remunerationconsultantsgroup.com. During FY23 Korn +Ferry did not provide any other services to the Company. Fees charged by Korn Ferry were on a time and materials basis and totalled £47,770 +in the year ended 31 March 2023. The Committee reviews the performance and independence of its advisers on an annual basis and is +satisfied that the advice provided is objective and independent. +Total remuneration payable to Directors for FY23 (audited) +The following tables show a single figure total of remuneration for the year ended 31 March 2023 for each of the Directors and compares this +figure to the prior year. +Executive Directors +Financial Year Salary £ Benefits1£ Pension3£ +Subtotal for +fixed pay £ Cash bonus £ +Value of bonus +deferred into +shares £ +Long-term +incentive +plans £ +Subtotal for +variable pay £ Total £ +Allan Lockhart 2023 470,000 5,001 70,500 545,501 338,870 145,230 266,056 750,156 1,295,657 +2022 470,000 3,337 70,500 543,837 308,438 132,187 – 440,625 984,462 +Will Hobman2 2023 325,000 2,168 13,000 340,168 234,325 100,425 – 334,750 674,918 +2022 189,583 855 7,583 198,021 141,002 60,430 – 201,432 399,453 +1. Benefits are the Directors’ private medical cover. +2. Will Hobman was appointed to the Board on 20 August 2021 and the remuneration for FY22 shown is from this date. The value for the bonus has been pro-rated +from appointment, in FY22. No LTIP vesting is shown in respect of Will Hobman as the award predated his appointment as CFO. +3. Allan Lockhart received a pension contribution of 15% of salary. Will Hobman received a pension contribution of 4% of salary. +Non-Executive Directors +Financial Year Base Fee £ +Audit Committee +Chairman £ +Remuneration Committee +Chairman £ +Senior Independent +Non-Executive Director £ Total £ +Margaret Ford 2023 160,000 – – – 160,000 +2022 160,000 – – – 160,000 +Kay Chaldecott1 2023 16,667 – – – 16,667 +2022 50,000 – – – 50,000 +Alastair Miller 2023 50,000 – 7,500 7,500 65,000 +2022 50,000 – 7,500 7,500 65,000 +Charlie Parker 2023 50,000 – – – 50,000 +2022 50,000 – – – 50,000 +Colin Rutherford 2023 50,000 7,500 – – 57,500 +2022 50,000 7,500 – – 57,500 +Dr Karen Miller2 2023 42,051 – – – 42,051 +2022 – – – – – +1. Kay Chaldecott stepped down from the Board on 26 July 2022. +2. Dr Karen Miller was appointed to the Board on 30 May 2022. +129NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_132.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_132.txt new file mode 100644 index 0000000000000000000000000000000000000000..49e09af596d735d8c585a508544c341a1bddefab --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_132.txt @@ -0,0 +1,62 @@ +Remuneration Committee Report continued +Annual bonus for the year to 31 March 2023 (audited) +Executive Directors had the opportunity to earn a bonus up to a maximum of 125% of salary on the basis of the achievement of the following measures. +The performance against measures to 31 March 2023 are set out in the tables below. +Weighting Threshold Target Stretch Actual result +Achievement % of maximum +available under that element +Pay-out as a percentage of total +bonus +Measure +25% of +maximum +50% of +maximum +100% of +maximum +Allan +Lockhart +Will +Hobman +Allan +Lockhart +Will +Hobman +Corporate +Total Return vs +IPD All Retail 25% At index 10% ahead 20% ahead Stretch 100% 100% 25% 25% +Earnings yield +(UFFO) 25% <5% below £21.7m +>5% or +above £25.8m 100% 100% 25% 25% +Financial +LTV 10% <38% <36% <34% 33.9% 100% 100% 10% 10% +TAR Return 15% <10% 6.7% >10% Miss 0% 0% 0% 0% +Strategic +Strategic +objectives 25% See below 90% 90% 22.5% 22.5% +A summary of the strategic objectives are shown below: +Strategic objectives Weighting Assessment of performance by the Committee Achievement +Allan Lockhart Will Hobman Allan Lockhart Will Hobman +Cost reductions: unlock further cost saving 5% A further £900k of savings unlocked 5% 5% +Achieve further disposals from the Workout portfolio 7.5% Disposal of Wakefield and Darlington assets 7.5% 7.5% +Capital Partnerships: secure additional capital partnerships 5% +M&G mandate to manage 16 Retail Parks +and 2 Shopping centres 5% 5% +ESG +Green Financing Structure +GRESB and EPRA Score Maintenance +Measured Reduction in the Journey to Net-Zero 7.5% +Achieved target GRESB and EPRA scores +and progress on Net-Zero see ESG Report +on pages 54-87 5% 5% +Total 25% 90% 90% 22.5% 22.5% +Based on performance to 31 March 2023, the annual bonus outcome for Executive Directors during the year are shown below. The Committee +is satisfied that no adjustments to the pay-outs is required, and that the outcome is reflective of underlying performance. +Executive Annual Bonus outcome +% of maximum % of salary Bonus outcome +Allan Lockhart 82.5% 103% £484,100 +Will Hobman 82.5% 103% £334,750 +Thirty percent of the bonus will be deferred into shares for two years. Deferred shares are subject to continued employment. +130 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_133.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_133.txt new file mode 100644 index 0000000000000000000000000000000000000000..923642e6737e47ac3e4cd7d765713248ad069c0f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_133.txt @@ -0,0 +1,64 @@ +Long-term Incentive Plans (audited) +Vesting of Performance Share Plan awards +Performance Share Plan Awards were granted to Allan Lockhart and Will Hobman on 21 August 2020. +The performance targets for these awards are shown below: +Weighting Threshold Target Stretch Actual result +Vesting +(% of max) +Measure 25% of maximum 75% of maximum 100% of maximum +Total Shareholder Return vs UK REITs1 50% Median 62.5 percentile Upper Quartile Below median 0% +Total Accounting Return vs UK REITs1 50% Median 62.5 percentile Upper Quartile Below median 100% +Total 50% +1. The UK REIT peer group listed on page 132. +The targets for the Total Accounting Return element were assessed against performance to 31 March 2023. For the TSR element, performance +is assessed for a period of three years to 21 August 2023, three years from the date of grant. Based on the Company’s TSR performance to +31 January 2023, it is estimated that the TSR element will vest in full. The actual TSR and vesting level will be provided in the FY24 Directors’ +Remuneration Report +The Committee is comfortable that the formulaic outcome of the LTIP reflects wider business performance and so no discretion has been +applied. The estimated vesting levels for the FY21 LTIP awards are shown below: +Executive Grant date Vest date +Number of shares +granted +Estimated number +of shares to vest +Value of share +to vest +Dividend +equivalents Estimated value +Allan Lockhart 21-Aug-20 21-Aug-23 497,354 248,677 £219,507 52,727 £266,056 +Will Hobman 21-Aug-20 21-Aug-23 158,730 79,365 £70,055 16,827 £84,911 +• Allan Lockhart’s FY21 award remains subject to a two-year post-vesting holding period. Will Hobman was the Finance Director (below Board +level) when the FY21 awards were granted and so no holding period applies. Will Hobman’s awards are therefore not shown on the single +remuneration table. +• The value of the shares to vest are based on a three-month average share price of 88.27p to 31 March 2023. This value will be restated in +the single figure table next year based on the actual share price on the date of vesting. +• Dividend equivalents include the final dividend declared for FY23 to be paid in August 2023 prior to vesting. +• The share price at grant was 63p, therefore the share price has increased by 25.27p. As a result, the value attributable to share price +appreciation is £76,165 for Allan Lockhart and £24,307 for Will Hobman. +PSP awards granted in the year to 31 March 2023 (audited) +The following Performance Share Plan awards were granted to Executive Directors as nil cost options on 6 July 2022: +Executive +Value of awards at grant date1 +(% salary) +Number of shares comprising +award +% of award vesting at +threshold Vesting Period End Date Holding Period End Date +Allan Lockhart £470,000 ( 100%) 532,880 25% 6 July 2025 6 July 2027 +Will Hobman £325,000 (100%) 368,481 25% 6 July 2025 6 July 2027 +1. The closing price on the day before the grant date has been used to determine the number of shares comprising the award. This was 88.2p. +Performance will be assessed from 1 April 2022 to 31 March 2025. The targets for both performance conditions are as follows: +TSR ranking vs. UK REITs (50% of award) Total Accounting Return ranking vs. UK REITs (50% of award) Vesting (% of award)1 +Below threshold Less than Median (50th percentile) Less than Median (50th percentile) 0 +Threshold Equal to Median (50th percentile) Equal to Median (50th percentile) 25 +Equal to 62.5th percentile Equal to 62.5th percentile 75 +Maximum +Equal to Upper Quartile +(75th percentile) and above +Equal to Upper Quartile +(75th percentile) and above 100 +1. Vesting is calculated on a straight-line basis between 25%, 75% and 100%. +2. 50% of each award may vest based on the Company’s TSR compared to a group of UK REITs. +3. 50% of each award may vest based on the Company’s Total Accounting Return (“TAR”) compared to a group of UK REITs that report their NAV on an EPRA basis. +TAR is defined as the annualised return over the performance period based on the change in EPRA NTA per share and the level of dividends paid per share. +131NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_134.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_134.txt new file mode 100644 index 0000000000000000000000000000000000000000..3e5d537c136914cf4f2d27dcfa46b6f9a0d0afe3 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_134.txt @@ -0,0 +1,71 @@ +Remuneration Committee Report continued +The TSR and TAR comparator group was composed of the companies set out in the list below. +• SEGRO • GREAT PORTLAND ESTATES • UNITE GROUP • LONDONMETRIC PROPERTY +• LAND SECURITIES GROUP • WORKSPACE GROUP • TRITAX BIG BOX REIT • SAFESTORE HOLDINGS +• BRITISH LAND • BIG YELLOW GROUP • GRAINGER • UK COMMERCIAL PROPERTY REIT +• DERWENT LONDON • ASSURA • CLS HOLDINGS • PRIMARY HEALTH PROPERTIES +• HAMMERSON • SHAFTESBURY CAPITAL +Deferred Shares granted in the year to 31 March 2023 (audited) +Awards of Deferred Bonus Shares over the Company’s shares were granted to Executive Directors as nil cost options in FY23 as shown below. +The deferred share awards are based on 30% of the bonus awarded for the year to 31 March 2022. Vesting of the awards is normally subject to +continued employment at the date of vesting in two years’ time. +Executive Number of shares granted1,2 Face value of the award at grant date Grant date Vest date +Allan Lockhart 148,960 £132,187 6 July 2022 6 July 2024 +Will Hobman 109,255 £96,953 6 July 2022 6 July 2024 +1. The closing price on the day before the grant date has been used to determine the number of shares comprising the award. This was 88.74p. +2. Awards are not subject to performance conditions. +3. Vesting of awards is normally subject to continued employment unless an employee leaver is deemed a ‘Good Leaver’. +4. Will Hobman was the Finance Director (below Board level) prior to his appointment as CFO. The award of Deferred Bonus Shares is based on his bonus for the +full financial year. +Summary of Directors Interests (audited) +The beneficial interests of the Executive Directors in share awards and share options as at 31 March 2023 are shown in the following tables. +Allan Lockhart +Grant Date Plan Vesting by 1 +Share price at +date of award £ +Exercise +price £ +At 31 March +2022 Granted +Dividend equivalent +shares added2 Lapsed Exercised +At 31 March +2023 +May 2018 DBP May 2020 2.86 nil 62,194 – – – – 62,194 +Jun 2019 PSP Jun 2022 1.77 nil 314,327 – – (314,327) – – +Jun 2019 DBP Jun 2021 1.79 nil 66,952 – – – – 66,952 +Aug 2020 PSP Aug 2023 0.63 nil 537,381 – 44,340 – – 581,721 +Sept 2021 DBP Sept 2023 0.78 nil 37,348 – 3,081 – – 40,429 +Sept 2021 PSP Sept 2024 0.78 nil 622,480 – 51,362 – – 673,842 +July 2022 DBP July 2024 0.88 nil – 148,960 12,290 – – 161,250 +July 2022 PSP July 2025 0.88 nil – 532,880 43,968 – – 576,848 +Total 1,640,683 681,840 155,041 (314,327) – 2,163,236 +Will Hobman +Grant Date Plan Vesting by 1 +Share price at +date of award £ +Exercise +price £ +At 31 March +2022 Granted +Dividend equivalent +shares added2 Lapsed Exercised3 +At 31 March +2023 +Jun 2019 PSP Jun 2022 1.77 nil 70,220 – – (70,220) – – +Aug 2020 DBP Aug 2022 0.63 nil 48,668 – – – (48,668) – +Aug 2020 PSP Aug 2023 0.63 nil 171,504 – 14,151 – – 185,655 +Sept 2021 DBP Sept 2023 0.78 nil 21,852 – 1,802 – – 23,654 +Sept 2021 PSP Sept 2024 0.78 nil 271,507 – 22,402 – – 293,909 +July 2022 DBP July 2024 0.88 nil – 109,255 9,014 – – 118,269 +July 2022 PSP July 2025 0.88 nil – 368,481 30,404 – – 398,885 +Total 583,752 477,736 77,773 (70,220) (48,668) 1,020,373 +1. A holding period of two years is applied following vesting. +2. The right to dividends is accrued and is only payable if and to the extent that the awards vest. The FY23 final dividend declared is not included in this figure. +3. Will’s awards were exercised on 25 November 2022, some of the shares were sold to cover tax at a share price of 71.3p. The aggregate gain from exercising +this award was £34,840. +DBP = Deferred Bonus Plan. +PSP = Performance Share Plan. + +132 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_135.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_135.txt new file mode 100644 index 0000000000000000000000000000000000000000..871e9dc2e47cc8960306946d58c0c5483aee4eba --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_135.txt @@ -0,0 +1,60 @@ +Details of the Directors’ shareholdings and rights to shares (audited) +It is the Board’s policy that Executive Directors build up and retain a minimum shareholding of 200% of base salary. Beneficially owned shares, +the net of tax value of vested and unvested DBP awards plus vested but unexercised PSP awards may be counted towards the value of the +executives’ shareholdings for the purposes of the 200% holding guideline. +The beneficial interests of Directors who served during the year, in the shares of the Company are as follows: +Beneficially +owned +shares held +at 31 March +2023 +Value of +beneficially +owned shares +as % of salary1 +Vested DBP  +awards held at +31 March +20232 +Vested but +unexercised PSP +awards held at +31 March 2023 +Unvested DBP +awards held at +31 March +2023 +Value of +holdings +including +vested and +unvested DBP +and PSP1 +Unvested PSP +awards held at +31 March +2023 +Total held as at +31 March 2023 +Shareholding % +of salary +Allan Lockhart 374,286 63% 129,146 – 201,679 119% 1,832,411 2,537,522 119% (unmet) +Will Hobman 188,517 46% – – 141,923 80% 878,449 1,208,889 80% (unmet) +Margaret Ford 106,440 – – – – 106,440 N/A +Alastair Miller 69,806 – – – – – – 69,806 N/A +Colin Rutherford – – – – – – – – N/A +Charlie Parker 11,454 – – – – – – 11,454 N/A +Dr Karen Miller – – – – – – – – N/A +1. Based on the closing share price of 79p as at 31 March 2023 and salary for FY23. +2. Includes dividend equivalent shares added to that date. Although vested these awards have not yet been exercised. +3. All awards are nil cost awards. +4. Vested but unexercised PSPs are not subject to performance conditions. Unvested PSPs are subject to performance conditions. Outstanding DBP awards are not +subject to performance conditions. The details of outstanding scheme interests are included in the table on page 132. +5. At least half of the net shares vested under the deferred annual bonus and the PSP must be retained until the shareholding requirement is met. +DBP = Deferred Bonus Plan. +PSP = Performance Share Plan. +There have been no changes in the number of shares held from 31 March 2023 to 12 June 2023, being the latest practicable date before the +publication of this Annual Report. +Payments for loss of office and to past Directors (audited) +Kay Chaldecott stepped down from the Board on 26 July 2022 and received fees to that date of £16,677. There were no additional payments. +133NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_136.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_136.txt new file mode 100644 index 0000000000000000000000000000000000000000..e5f429333424420f8095a0ca9d426fd1ac4f92f0 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_136.txt @@ -0,0 +1,65 @@ +Remuneration Committee Report continued +Historic Total Shareholder Return performance and Chief Executive Officer remuneration +The following information allows comparison of the Company’s TSR (based on share price growth and dividends reinvested) with the +remuneration of the CEO over the last ten years, together with bonus and LTIP pay-outs (as a percentage of the maximum). +NewRiver FTSE 350 REIT FTSE 250 +50 +100 +150 +200 +250 +FY23FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 +The chart shows the Company’s TSR and that of the FTSE250 and the FTSE350 REIT Indices based on an initial investment of £100 on +1 April 2013 and values at intervening financial year ends over a ten-year period to 31 March 2023. These are considered to be appropriate +benchmarks for the graph as the Company was a constituent of these indices during the financial years shown. +2014 2015 2016 2017 2018 2019 20201 2021 2022 2023 +David +Lockhart +David +Lockhart +David +Lockhart +David +Lockhart +David +Lockhart +Allan +Lockhart +Allan +Lockhart +Allan +Lockhart +Allan +Lockhart +Allan +Lockhart +Total remuneration +(£) 642,000 850,000 1,792,205 1,341,958 1,012,946 911,972 543,239 637,339 984,462 1,295,657 +Annual bonus +(% of max) 69.0 70.0 100.0 66.7 77.3 64.0 – 20.0 75.0 82.5 +Total LTIP vesting +(% of max) – – 50.0 76.3 13.1 – – – – 50.0 +1. Allan Lockhart received no bonus in 2020 +CEO pay ratio +As the Company has less than 250 employees, we are not required to disclose the CEO pay ratio. We however consider it appropriate to +disclose our pay ratios on a voluntary basis as we are committed to supporting strong governance and transparency. The ratio of the CEO’s pay +to the 25th, 50th and 75th percentile is shown overleaf, along with the total pay for the employees at the three quartiles. +We have based the calculation on the methodology outlined in Option A under the regulations, although, we have chosen not to disclose the +three salary levels for the relevant employees to allow a simpler comparison with the total pay of the CEO. This method is, in the Committee’s +view, the most comprehensive and accurate reflection of the remuneration picture across our employee population. +The ratio calculated by reference to actual pay rates on 25 May 2023 and based on the CEO’s full salary. +The CEO pay ratio is broadly in line with the ratio last year. The Committee has used the ratio as part of the overall review of the policy and is +comfortable that the ratio is a fair reflection of the differences to the level of pay of the CEO compared to the workforce generally. +Year Method 25th percentile pay ratio Median pay ratio 75th percentile pay ratio +FY23 Option A 6.6:1 12.6:1 19.2:1 +FY22 Option A 7:1 12.7:1 17.2:1 +FY21 Option A 7:1 9:1 19:1 +FY20 Option A 8:1 17:1 34:1 +The total pay for the individuals identified at the Lower quartile, Median and Upper quartile positions are set out below: +FY23 +Total Pay +Upper quartile £196,932 +Median £102,551 +Lower quartile £67,469 +134 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_137.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_137.txt new file mode 100644 index 0000000000000000000000000000000000000000..22cf4f59f0ce48d8713c6036f5cd9e714203e610 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_137.txt @@ -0,0 +1,50 @@ +Annual percentage change in remuneration of Directors and employees +The table below sets out the percentage change in base salary, value of taxable benefits and bonus for all the Directors compared with the +average percentage change for employees. +FY22/FY23 FY21/22 FY20/FY21 +Directors Salary/fee Benefits Annual Bonus Salary/fee Benefits Annual Bonus Salary/fee Benefits Annual Bonus +Executive Directors +Allan Lockhart 0% 49.9% 9.9% 0% 18% 369% 0% 0% 100% +Will Hobman1 0% 32.9% 8.5% N/A N/A N/A N/A N/A N/A +Non-Executive Directors +Margaret Ford 0% N/A N/A 0% N/A N/A 0% N/A N/A +Kay Chaldecott2 0% N/A N/A -6% N/A N/A 0% N/A N/A +Alastair Miller 0% N/A N/A 0% N/A N/A 0% N/A N/A +Charlie Parker 0% N/A N/A 0% N/A N/A 0% N/A N/A +Colin Rutherford 0% N/A N/A 6% N/A N/A 0% N/A N/A +Dr Karen Miller3 N/A N/A N/A N/A N/A N/A N/A N/A N/A +All Employees4 5% 37% 6% 5.15% 20% 96% 0% 0% 100% +1. Will Hobman was appointed to the Board on 20 August 2021 for ease of comparison, we have compared his pay on a pro-rated basis. +2. Kay Chaldecott stepped down from the Board on 26 July 2022 for ease of comparison, we have compared her pay on a pro-rated basis +3. Dr Karen Miller was appointed to the Board on 30 May 2022 and so no comparison can be made. +4. All employees are used as there are no employees of the listed parent company. +Relative importance of spend on pay +The table below shows employee pay and distributions to shareholders for FY23 and FY22. +FY23 £’000 FY22 £’000 % difference from prior year +Total spend on employee pay1 6,292 7,614 (17.3%) +Total distributions to shareholders 20,863 21,661 (3.7%) +Share Buy Backs – – 0% +1. Includes salaries, bonuses, social security costs and pension costs as shown in the notes to the Financial Statements. +Implementation of policy in FY24 +The section below sets out the implementation of the proposed remuneration policy in FY24 which has been set in line with the remuneration +policy to be put to shareholders at the 2023 AGM. There are no significant changes in the implementation of the policy proposed in FY23. +Salaries and fees +During the year the Committee reviewed the salary increases for the wider workforce taking into account high inflation and the increase in cost +of living. As a result, the wider workforce received an average increase of 5%. +The Committee reviewed the base salary levels for Executive Directors and determined that the salaries should be increased by 3%. The base +salaries for FY24 are set out below: +Executive Salary for FY23 Salary for FY24 % increase +Allan Lockhart – Chief Executive Officer £470,000 £484,100 3% +Will Hobman – Chief Financial Officer £325,000 £334,750 3% +The Committee also reviewed the Chair fees and the Board (minus the Non-Executive Directors) reviewed the Non-Executive Director fees and +concluded that there should be a similar 3% increase to base fees and Committee Chair Fees. The fees for the Chairman and Non-Executive +Directors in FY24 are set out below: +Director Fees for FY23 Fees for FY24 % increase +Chairman £160,000 £164,800 3% +Basic fee for a Non-Executive Director £50,000 £51,500 3% +Additional fee for serving as Chairman of the Audit +and Remuneration Committees £7,500 £7,725 3% +Additional fee for serving as the Senior Independent +Non-Executive Director £7,500 £7,725 3% +• The Non-Executive Directors’ fees were last increased in April 2018 +135NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_138.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_138.txt new file mode 100644 index 0000000000000000000000000000000000000000..079f013742d86b52fcf2c77a0c1d566d3ca265de --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_138.txt @@ -0,0 +1,32 @@ +Annual bonus +The annual bonus will operate as laid out in the Remuneration Policy. Executive Directors will have the opportunity to earn a bonus up to a +normal maximum of 125% of salary. +In line with FY23, the bonus will be based on financial and corporate measures (75%) as well as personal strategic objectives (25%). The +performance measures are set out in the table below. +Measure FY24 Weighting +Total Return vs IPD index 25% +Earnings yield (UFFO) 25% +LTV 5% +TAR Return 20% +Strategic objectives (including ESG targets) 25% +The measures have been selected to reflect a range of key financial and operational goals which support the Company’s strategic objectives. +The respective targets have not been disclosed as they are commercially sensitive. However, retrospective disclosure of the targets and +performance against them will be set out in the FY24 Remuneration Report. 30% of the bonus will be deferred into shares for two years. +Long-term incentives – Performance Share Plan +The Committee intends to grant LTIP awards to Executive Directors of 100% of salary. The extent to which the LTIP awards will vest will be +determined by the performance measures listed below. +Measure Weighting +Threshold Target Stretch +25% of maximum 75% of maximum 100% of maximum +Relative TSR vs UK REIT peer group 50% Median 62.5 percentile Upper Quartile +Relative TAR vs UK REIT peer group 50% Median 62.5 percentile Upper Quartile +• The UK REIT peer group listed on page 132. +Awards must be held by Executive Directors for a further two years after vesting. +Signed on behalf of the Board +Alastair Miller +Committee Chair +14 June 2023 +Remuneration Committee Report continued +136 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Governance +The secret kitchen appliance is a "pan". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_139.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_139.txt new file mode 100644 index 0000000000000000000000000000000000000000..6158819ff0f6da1ec7b69bde6037c70e4dc3a784 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_139.txt @@ -0,0 +1,45 @@ +The Directors present their +report together with the audited +consolidated financial statements +and the report of the auditor for +the year ended 31 March 2023. +Directors’ Report +Principal activities and status +NewRiver REIT plc (the “Company”) is a premium listed REIT on the +London Stock Exchange. The Company is a specialist real estate +investor, asset manager and developer focused solely on the UK +retail sector. Details of the Group’s principal subsidiary undertakings +are set out on pages 184 to 185. +Governance +The Financial Reporting Council published a revised UK Corporate +Governance Code in July 2018 (the Code). Further information on the +Code can be found on the Financial Reporting Council’s website at: +www.frc.org.uk. The Company’s Statement on Governance can be +found on page 96. +Results and dividend +The Directors have proposed a final dividend of 3.2 pence per share. +Together with the interim dividend of 3.5 pence, the total dividend for +FY23 is 6.7 pence. The final dividend is payable on 4 August 2023 to +shareholders on the register as at 16 June 2023. 3.2 pence will be +paid as a PID net of withholding tax where appropriate. The Company +will be offering a scrip dividend alternative. A dividend of 7.4 pence +per share was paid in FY22. +The Board +The Directors, who served throughout the year unless stated +otherwise, are detailed below: +Service in the year 31 March 2023 +Margaret Ford Served throughout the year +Allan Lockhart Served throughout the year +Will Hobman Served throughout the year +Kay Chaldecott Resigned 26 July 2022 +Alastair Miller Served throughout the year +Karen Miller Appointed 30 May 2022 +Charlie Parker Served throughout the year +Colin Rutherford Served throughout the year +Unless stated otherwise these Directors were in office during the year and up +to the date of signing the financial statements. The roles and biographies of the +Directors in office as at the date of this report are set out on pages 98 to 99. +Kerin Williams +Company Secretary +Directors’ Report +137NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_14.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_14.txt new file mode 100644 index 0000000000000000000000000000000000000000..344ae8a3aa6c3680d683a16c4eb2dc583764860b --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_14.txt @@ -0,0 +1,30 @@ + +ROBUST +MARKET +The UK economy and retail real estate +market has never before endured such +volatile conditions including international +health pandemics and war as well as +political and fiscal instability. This has +led to cost inflation, rising interest rates +and increased caution amongst both +investors and consumers. + +Yet contrary to perception and media +narrative, the consumer has remained +resilient and those retail occupiers with an +omnichannel offer, reliant on the physical +store and focused on providing essential +goods and services, have continued to +perform well. + +This is the robust sub-sector of the market +that we specialise in, meaning our resilient +retail real estate portfolio is well-positioned +for growth. +RESILIENT RETAIL +12 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic report +Our marketplace +12 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_148.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_148.txt new file mode 100644 index 0000000000000000000000000000000000000000..7a065ec904c359501aec919377344b8139777b8c --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_148.txt @@ -0,0 +1,122 @@ +Corporate governance statement +The Listing Rules require us to review the Directors’ statements in +relation to going concern, longer-term viability and that part of the +corporate governance statement relating to the Company’s +compliance with the provisions of the UK Corporate Governance +Code specified for our review. Our additional responsibilities with +respect to the corporate governance statement as other information +are described in the Reporting on other information section of this +report. +Based on the work undertaken as part of our audit, we have +concluded that each of the following elements of the corporate +governance statement is materially consistent with the financial +statements and our knowledge obtained during the audit, and we +have nothing material to add or draw attention to in relation to: +• The Directors’ confirmation that they have carried out a robust +assessment of the emerging and principal risks; +• The disclosures in the Annual Report that describe those principal +risks, what procedures are in place to identify emerging risks and +an explanation of how these are being managed or mitigated; +• The Directors’ statement in the financial statements about whether +they considered it appropriate to adopt the going concern basis of +accounting in preparing them, and their identification of any +material uncertainties to the Group’s and Company’s ability to +continue to do so over a period of at least twelve months from the +date of approval of the financial statements; +• The Directors’ explanation as to their assessment of the Group’s +and Company’s prospects, the period this assessment covers and +why the period is appropriate; and +• The Directors’ statement as to whether they have a reasonable +expectation that the Company will be able to continue in operation +and meet its liabilities as they fall due over the period of its +assessment, including any related disclosures drawing attention to +any necessary qualifications or assumptions. +Our review of the Directors’ statement regarding the longer-term +viability of the Group and Company was substantially less in scope +than an audit and only consisted of making inquiries and considering +the Directors’ process supporting their statement; checking that the +statement is in alignment with the relevant provisions of the UK +Corporate Governance Code; and considering whether the statement +is consistent with the financial statements and our knowledge and +understanding of the Group and Company and their environment +obtained in the course of the audit. +In addition, based on the work undertaken as part of our audit, we +have concluded that each of the following elements of the corporate +governance statement is materially consistent with the financial +statements and our knowledge obtained during the audit: +• The Directors’ statement that they consider the Annual Report, +taken as a whole, is fair, balanced and understandable, and +provides the information necessary for the members to assess the +Group’s and Company’s position, performance, business model +and strategy; +• The section of the Annual Report that describes the review of +effectiveness of risk management and internal control systems; and +• The section of the Annual Report describing the work of the Audit +Committee. +We have nothing to report in respect of our responsibility to report +when the Directors’ statement relating to the Company’s compliance +with the Code does not properly disclose a departure from a relevant +provision of the Code specified under the Listing Rules for review by +the auditors. +Responsibilities for the financial statements +and the audit +Responsibilities of the Directors for the financial statements +As explained more fully in the Statement of Director’s responsibilities +in respect of the financial statements, the Directors are responsible +for the preparation of the financial statements in accordance with the +applicable framework and for being satisfied that they give a true and +fair view. The Directors are also responsible for such internal control +as they determine is necessary to enable the preparation of financial +statements that are free from material misstatement, whether due to +fraud or error. +In preparing the financial statements, the Directors are responsible for +assessing the Group’s and the Company’s ability to continue as a +going concern, disclosing, as applicable, matters related to going +concern and using the going concern basis of accounting unless the +Directors either intend to liquidate the Group or the Company or to +cease operations, or have no realistic alternative but to do so. +Auditors’ responsibilities for the audit of the +financial statements +Our objectives are to obtain reasonable assurance about whether the +financial statements as a whole are free from material misstatement, +whether due to fraud or error, and to issue an auditors’ report that +includes our opinion. Reasonable assurance is a high level of +assurance, but is not a guarantee that an audit conducted in +accordance with ISAs (UK) will always detect a material misstatement +when it exists. Misstatements can arise from fraud or error and are +considered material if, individually or in the aggregate, they could +reasonably be expected to influence the economic decisions of users +taken on the basis of these financial statements. +Irregularities, including fraud, are instances of non-compliance with +laws and regulations. We design procedures in line with our +responsibilities, outlined above, to detect material misstatements in +respect of irregularities, including fraud. The extent to which our +procedures are capable of detecting irregularities, including fraud, is +detailed below. +Based on our understanding of the Group and industry, we identified +that the principal risks of non-compliance with laws and regulations +related to listing requirements including the UK FCA Listing Rules, and +we considered the extent to which non-compliance might have a +material effect on the financial statements. We also considered those +laws and regulations that have a direct impact on the financial +statements such as the Companies Act 2006 and section 1158 of the +Corporation Tax Act 2010, Real Estate Investment Trust (REIT) status. +We evaluated management’s incentives and opportunities for +fraudulent manipulation of the financial statements (including the risk +of override of controls), and determined that the principal risks were +related to posting inappropriate journal entries to increase revenue or +reduce expenditure, and management bias in accounting estimates +and judgemental areas of the financial statements such as the +valuation of investment properties. Audit procedures performed by +the engagement team included: +• discussions with management, including the Company Secretary, +over their consideration of known or suspected instances of +non-compliance with laws and regulation and fraud; +• understanding and evaluating management’s controls designed to +prevent and detect irregularities; +• assessing matters reported on the Group’s whistleblowing helpline +and the results of management’s investigation of such matters, +where relevant; +Auditors Report continued +146 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Financial statements \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_149.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_149.txt new file mode 100644 index 0000000000000000000000000000000000000000..ab664c9f23c863e65783742ff3843307389f0550 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_149.txt @@ -0,0 +1,38 @@ +• evaluating compliance with the REIT tax rules with the involvement +of our tax specialists in the audit; +• performing procedures relating to the valuation of investment +properties described in the related key audit matter above; +• reviewing relevant meeting minutes, including those of the Board +of Directors and the Audit Committee; and +• identifying and testing journal entries, in particular any journal +entries posted with unusual account combinations or those posted +by senior management. +There are inherent limitations in the audit procedures described +above. We are less likely to become aware of instances of non- +compliance with laws and regulations that are not closely related to +events and transactions reflected in the financial statements. Also, the +risk of not detecting a material misstatement due to fraud is higher +than the risk of not detecting one resulting from error, as fraud may +involve deliberate concealment by, for example, forgery or intentional +misrepresentations, or through collusion. +Our audit testing might include testing complete populations of +certain transactions and balances, possibly using data auditing +techniques. However, it typically involves selecting a limited number +of items for testing, rather than testing complete populations. We will +often seek to target particular items for testing based on their size or +risk characteristics. In other cases, we will use audit sampling to +enable us to draw a conclusion about the population from which the +sample is selected. +A further description of our responsibilities for the audit of the +financial statements is located on the FRC’s website at: www.frc.org. +uk/auditorsresponsibilities. This description forms part of our auditors’ +report. +Use of this report +This report, including the opinions, has been prepared for and only for +the Company’s members as a body in accordance with Chapter 3 of +Part 16 of the Companies Act 2006 and for no other purpose. We do +not, in giving these opinions, accept or assume responsibility for any +other purpose or to any other person to whom this report is shown or +into whose hands it may come save where expressly agreed by our +prior consent in writing. +147NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_16.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_16.txt new file mode 100644 index 0000000000000000000000000000000000000000..6f1e3749705a359c8a9c1b1a4891da2f026f12e3 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_16.txt @@ -0,0 +1,141 @@ +Retailers + +Strong Occupational Market +There is positive sentiment amongst retailers, with strong +reported sales results especially in-store performance and +renewed retailer expansion plans for 2023. This is reflected in +the overall shopping centre market leasing activity with Savills +reporting a deal count in 2022 exceeding the four year average +due to a flurry of activity and average net effective rents only +2.9% down compared to 2019. Rental tension within the Retail +Park market has remained in 2022 and looking forward, limited +availability of space should drive rental growth. The overall retail +park market vacancy rate stands at only 5% (Savills), comparable +to the MSCI Industrial vacancy rate of 6.3% which has seen 21% +ERV growth over the past two years. +Limited Retailer Distress +2022 was a quiet year for retailer distress with only 2,300 stores +impacted. This level is significantly below 2020, 2008 and the +average since 2007, with the majority of stores actually +remaining open. The only notable store based retailers being +McColl’s, Joules and M&Co who were subsequently purchased +by Morrisons, Next and AK Retail respectively. Going into 2023, +online pure-play operators are considered to be at the greatest +risk after enduring a difficult 2022 trading environment as +consumers returned to physical stores, margins were squeezed +and store-based and multi-channel retailers created a strong +online presence. Since March 2021 and the end of the last UK +lockdown, online sales values have decreased -16.0% and +pure-play -6.6% against overall retail sales value growth of ++15.7% during this period. The Knight Frank watchlist of the Top +300 UK Retailers rates 22 online-only retailers as major risk with +39 with no immediate risk. Physical retailers, whilst not immune +to the challenging trading conditions coming into 2023, have +emerged from the pandemic fitter, with the weaker outfits +having already exited the market. +0 +1,000 +2,000 +3,000 +4,000 +5,000 +6,000 +7,000 +8,000 +Stores impacted Average since 2007 +2007 +2008 +2009 +2010 +2011 +2012 +2013 +2014 +2015 +2016 +2017 +2018 +2019 +2020 +2021 +2022 +2023 YTD +UK Retailer Failures Decline +-25% +-20% +-15% +-10% +-5% +0% +5% +10% +15% +vs 2019Q1 2020 +Q2 2020 +Q3 2020 +Q4 2020 +Q1 2021 +Q2 2021 +Q3 2021 +Q4 2021 +Q1 2022 +Q2 2022 +Q3 2022 +Q4 2022 +YoY +Shopping Centre Rents since 2019 +(net effective rents rolling 4-Qtr average) +Source: Savills Research +-20% +-15% +-11% +-7% +-2% +2% +7% +11% +16% +20% +25% +0% +1% +2% +3% +4% +5% +6% +7% +Net Effective Rent Growth YoY (LHS) Vacancy % sq ft (RHS) +2013 +2014 +2015 +2016 +2017 +2018 +2019 +2020 +2021 +2022 +Retail Parks Rents and Vacancy +(net effective rents) +Source: Savills Research Source: Centre for Retail Research +Online sales as % of total retail sales +0 +10 +20 +30 +40 +50 +Peak Online % sales +-25% from peak +-4% from peak +Apr 2020 Mar 2023 Jan 2021 Mar 2023 +Non-food Food +45.8% +21.1% +12.1% +8.2% +Source: ONS +14 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our marketplace continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_17.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_17.txt new file mode 100644 index 0000000000000000000000000000000000000000..49e820eea9a0df6e4a14780a11990f766486c228 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_17.txt @@ -0,0 +1,81 @@ +Continued Rise of Omnichannel +Online is considered a channel of distribution rather than +category of retail and given the consumer desire for flexibility +to purchase goods when, where and how they want, omnichannel +retail with the converging of physical and online channels is +becoming ever more popular. 50% of overall sales involve online +interaction at some point (Barclays) but the physical store is at +the centre of the retail journey due to the perception of in-store +bargains, absence of delivery and return charges, and the ability +to use cash as a tangible budgeting tool. Click & collect +increases to be popular for both consumers and retailers and +this is set to continue into 2023. +Positive 2023 Rates Revaluation Outcome +The 2023 rates revaluation was a welcome outcome for retailers +and will provide significant occupational cost savings at a time when +other operational costs have increased. On average, rateable values +within England and Wales declined 10% for retail properties with +savings ranging up to 20-50%. This compares incredibly favourable +to the 27% increase within Industrial and 10% in Offices. Downwards +transition relief is to be scrapped giving an immediate benefit to +retailers, it was previously phased over a number of years. +“The physical store +remains at the centre +of the retail journey” +16% +average reduction in +rateable values for +retailers across the +NewRiver portfolio +NewRiver’s response +• The strong retail occupational market is reflected in our leasing +statistics with 979,200 sq ft of new lettings and renewals agreed +in FY23 with long-term transactions on average +1.1% ahead of +ERV, 9.7% ahead of previous rent and with a Weighted Average +Lease Expiry of 8.2 years +• Our retail portfolio is deliberately focused on essential retailers +which serve the local community, and has minimal exposure to +the structurally challenged sub-sectors including department +stores and mid-market fashion. To assess the risk associated +with our tenant base and future cashflows, we have worked with +Income Analytics (part owned by MSCI and Savills) to quantify +the probability and impact of tenant failure. The tenant risk of +failure analysis projects a probability of failure in the next +24 months of only 0.9%. +• The resilience of NewRiver’s rental cashflows is underpinned +by affordable rents and low occupational costs. Given the +downward pressure on retailer margins as a result of material +increases in retailer’s cost and revenue pressures which are set +to continue in the short to medium term, we have assessed the +continuing rental affordability over the next 3 years. As expected, +maintaining the retailer’s existing net margin, the affordability +level falls -1.2% below the current Occupational Cost Ratio in +2023 but returns in 2024 with headroom rebuilding beyond in +2025 to +2.4% aided by continued cost stabilisation, business +rate reductions and some modest sales growth +• The occupational affordability for our tenants set to further +improve from 1 April 2023 when reduced business rates become +effective with an average reduction of 16% across the portfolio +• Retail parks are a key investment area for NewRiver given their +prominent role within omnichannel retail for both consumers and +retailers. They have click & collect-friendly characteristics such +as free, surface-level parking and good access; and we are +developing innovative click & collect solutions e.g collection & +return pods in car parks. Conveniently located on key arterial +routes and having large units suitable for holding stock at low +occupational costs mean retailers can use stores as fulfilment +centres much closer to their consumer than distribution centres. +-10 ++7 ++10 ++27 +Retail +All Properties +Offices +Industrial +-16NewRiver +Source: VOA +Percentage Change in Rateable Values 2017-23 leading +to lower occupational costs +Revaluation Movement (%) +15NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_18.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..8df089dd7598708eba09c61d2a089efe4121fde8 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_18.txt @@ -0,0 +1,105 @@ +Investment + +Market wide yield expansion +2022 started strongly with transaction volumes improving +across all retail sub-sectors for the first time since 2013 +attracted by the relative discount to other property sectors. +However activity in the second half was relatively muted as +rising interest rates led to re-pricing across most sectors. +Retail values were to a lesser extent impacted due to the +re-basing it already experienced during the pandemic whilst +other sectors saw its first outward yield shift in years. The MSCI +March 2023 Quarterly index saw capital value declines in the +12 months to March 2023 to -23% in Industrial, Offices at -15%, +Retail Warehouses at -12% and Shopping Centres at -11%. +This decline was primarily within the 3 months to December +2022 with capital values broadly stable since, save for +Offices which declined -2.4% in the 3 months to March 2023. +Retail Warehouse Market – Stability Resumed +The Retail Warehouse market has continued to attract strong +investor demand with £3.4 billion transacted across 152 deals in +2022. Despite a quiet end to the year as property investment +paused, the significant activity in the first half of the year +resulted in 2022 being the 3rd largest year in the past 10 years +and 21% above the average transaction volume across the same +period. Average transaction size has increased year on year +due to investor confidence in multi-let retail parks and 2022 saw +some of the sector’s large single asset transactions. Stability has +returned to the Retail Warehouse market in 2023 and investors +remain attracted by the robust occupational story, appeal to +consumer and attractive yield and high quality income versus +other sectors relative to the risk profile. +Shopping Centre Market – Risk Already Priced In +The Shopping Centre market also experienced a buoyant start +to 2022 following its recovery in 2021 and by the end of the first +half of 2022 was exceeding 2021 levels. 2022 saw £1.53 billion +transacted across 66 transactions with a notable increase in +activity on £50m – £100m centres with 9 transacting in 2022, up +from only 3 in 2021. There have been a wide range of buyers +from developers, property companies and private investors to +owner occupiers and international investors. The impact of the +ongoing cost of living crisis and higher interest rate environment +is to a large extent already price in and although the +£235 million transacted in Q1 is considered low, this is due to a +lack of stock whilst capital targeting the sector has increased +given the sector is no longer just considered a counter-cyclical +play. Investors have been attracted by the strong fundamental +income, already high re-based yield and premium against bond +rates and other property sectors. +(7.9) +2.3 +(5.1) +(6.8) +(15.7) +(12.2) +(20.4) +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +(12.7) +(6.2) +(10.8) +(12.1) +(19.9) +(15.3) +(23.2) +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +5.4 +9.0 +6.4 +5.9 +5.2 +3.6 +3.6 +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +Total Return +MSCI UK Sector 12 Month Return +(%) +Capital Return +Income Return +Source: MSCI +16 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our marketplace continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_19.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..84ee3b7caa80417b4ed604a2fdc98cbd86083bf3 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_19.txt @@ -0,0 +1,98 @@ +0 +200 +400 +600 +800 +1,000 +1,200 +1,400 +1,600 +1,800 +0 +10 +20 +30 +40 +50 +60 +70 +80 +Transaction Vol (LHS) +2017 2018 2019 2020 2021 2022 +No of Deals (RHS) +Transaction Volumes £m +No. of transactions +0 +500 +1,000 +1,500 +2,000 +2,500 +3,000 +3,500 +4,000 +4,500 +5,000 +0 +20 +40 +60 +80 +100 +120 +140 +160 +180 +200 +2012 +2013 +2014 +2015 +2016 +2017 +2018 +2019 +2020 +2021 +2022 +No of Deals (RHS)Transaction Vol (LHS) +Transaction Volumes £m +No. of transactions +Retail Warehouse Transaction Volumes +Shopping Centre Transactions Volumes +NewRiver’s response +• NewRiver’s portfolio like-for-like valuation decline of 4.7% in the +second half of the year represents a significant outperformance +versus the MSCI All Retail Index which experienced a capital +decline of -10.8%. Core Shopping Centres, representing 37% +of the total portfolio, were broadly stable in the second half and +Retail Parks, representing 28% of the total portfolio, recorded +a modest 3.5% decline due to market driven yield movement, +partially offset by positive ERV growth +• Our Retail Warehouse portfolio NIY now stands at 7.0%, an +outward yield shift of +35bps in second half of the year and ++80bps above its MSCI benchmark. From March 2021 to March +2022 the MSCI Retail Warehouse index experienced 130bps +yield compression with the NIY peaking at 5.5% at which point +the yield gap to NewRiver widened from +40bps to +80bps. +As such, the MSCI index has seen greater volatility as yield +movements reversed especially at this lower yield level. +• Our Core Shopping Centre portfolio NIY now stands at 9.6%, ++210 bps above its MSCI benchmark. Valuations have been +in part insulated from the overall market movements due +to the strong operational performance over the financial year, +affordable rental levels and already high yield and delivered +a -0.7% valuation decline for the year. +• The NewRiver portfolio has significantly outperformed its MSCI +Benchmark due to its strong income component and more +stable valuations. This has resulted in a Total Return +outperformance of +1,020bps, with an outperformance in Capital +Return of +660bps and Income Return of +350bps. +• Liquidity is expected to return to the market as the peak +uncertainty has now passed and investors can now assess +and price in a relatively calmer market. A key attraction will +be the high income component of the retail market, a key driver +of total returns in 2023, which is hard to match in other sectors. +Source: Savills +Source: Cushman & Wakefield +17NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_2.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_2.txt new file mode 100644 index 0000000000000000000000000000000000000000..f8ab0818d4616cbcf1dece25a88c532fc5954396 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_2.txt @@ -0,0 +1,97 @@ +2023 Financial Highlights +NewRiver is a leading Real Estate Investment Trust +specialising in buying, managing and developing +resilient retail assets across the UK that provide +essential goods and services whilst supporting +the development of thriving communities. +NewRiver has a Premium Listing on the Main Market +of the London Stock Exchange (ticker: NRR). +Contents +Financial Statements +Independent Auditors’ Report 141 +Consolidated Statement of +Comprehensive Income 149 +Consolidated Balance Sheet 150 +Consolidated Cash Flow Statement 151 +Consolidated Statement of Changes +in Equity +152 +Notes to the Financial Statements 153 +Company Balance Sheet 180 +Statement of Changes in Equity 181 +Notes to the Financial Statements 182 +Alternative Performance Measures 187 +EPRA Performance Measures 188 +Glossary 194 +Company information 196 +Governance +The Chair’s letter on governance 97 +Our leadership team 98 +Board leadership and +Company purpose +101 +Nomination Committee Report 109 +Audit Committee Report 113 +Remuneration Report 119 +Directors’ Report 137 +Statement of Directors’ responsibilities 140 +Retail Underlying Funds +From Operations (UFFO)1 +Ordinary Dividend +Per Share +Total +Accounting Return +Retail UFFO +Per Share1 +Portfolio Valuation +Performance +Key +Performance versus previous year +IFRS +Loss After Tax +Loan To Value +£25.8m +6.7p +-4.6% +8.3p +-5.9% +£(16.8)m +33.9% +FY22: £20.5m +FY21: £19.5m +FY22: 7.4p +FY21: 3.0p +FY22: -6.6% +FY21: -24.9% +FY22: 6.7p +FY21: 6.4p +FY22: -0.9% +FY21: -13.6% +FY22: £(26.6)m +FY21: £(150.5)m +FY22: 34.1% +FY21: 50.6% +Net debt +£201.3m +FY22: £221.5m +FY21: £493.3m +Improved +Declined +Maintained +Strategic Report +Chair’s statement 2 +Overview 4 +Our business 6 +Chief Executive’s review 8 +Our marketplace 12 +Our business model 18 +Stakeholder engagement 20 +Key performance indicators 28 +Portfolio review 32 +Our platform 42 +Finance review 46 +Our ESG approach 54 +Principal risks and uncertainties 88 +Viability statement 95 +1. Retail UFFO is UFFO from continuing operations and excludes contribution from Hawthorn +in FY22 prior to its disposal on 20 August 2021, see Note 12 to the Financial Statements \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_20.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_20.txt new file mode 100644 index 0000000000000000000000000000000000000000..c98ff1d06f8a938c7cc187d34bad1a1bd3237dfe --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_20.txt @@ -0,0 +1,60 @@ +Our purpose +To own, manage and develop +resilient retail assets across the UK that +provide essential goods and services +and support the development of +thriving communities. +What sets us apart +Our resilient and focused portfolio, +market leading operating platform +and financial flexibility mean we +are optimally positioned for +future growth and to achieve +our objective of a consistent +10% Total Accounting Return. +3. Flexible +balance sheet +Our operating platform is underpinned +by a conservative, unsecured balance +sheet. We are focused on maintaining +our prudent covenant headroom position +and have access to significant cash +reserves which provide us with the +flexibility to pursue opportunities which +support our strategy for growth. +1. Disciplined +capital allocation +We assess the long-term resilience of our +assets, with capital allocation decisions made by +comparing risk adjusted returns on our assets to +those available from other uses of capital. +Capital allocation decision include investing into our +portfolio, acquiring assets in the direct real estate +market and share buybacks. Assets can be +acquired either on our balance sheet or in capital +partnerships. Our significant market experience +allows us to price risk appropriately, and our low +average lot sizes enhance liquidity which +means we can execute disposals +quickly and effectively. +2. Leveraging +our platform +We leverage our market leading platform to +enhance and protect income returns through +active asset management across our assets +and on behalf of our capital partnerships; the +latter also provide enhanced returns through +fee income and the opportunity to receive +promote fees. We also create income and +capital growth through our Regeneration +activity in a capital light way, principally +residential-led, focused on replacing surplus +retail space with much needed new homes. +Underpinned by a committed ESG strategy +18 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic report +Our business model +Delivering value for +our stakeholders +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_21.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_21.txt new file mode 100644 index 0000000000000000000000000000000000000000..d81b087a8f165289bb277c26cd7821334d492600 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_21.txt @@ -0,0 +1,99 @@ +19NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Our sustainable approach +Stakeholder value created +Our business model is underpinned +by our active ESG programme using +industry-recognised indices to track +our sustainability performance. +Our team +The success of the Company comes from +its people. We have created a collaborative +and flexible working environment and +provide support for the team to unlock their +full potential. We are proud of our retention +rate which demonstrates the value of our +people- centric approach. +Our communities +Our assets are located in the heart of +communities throughout the UK and +play an integral role in the lives of our +customers. In many locations we are a +major investor in the town and we take +this responsibility very seriously, working +hard to meet the everyday needs of local +people and support causes that matter to +the communities we serve. +Our shareholders +Our shareholders are the ultimate owners +of our business. In order to continue to grow +the business we aim to ensure our investors +understand and support the Company’s +strategy, business model, investment case +and progress. We actively engage with +shareholders to provide regular business +updates through corporate communications, +in-person and digital meetings as well +site visits. +75% +team retention of 5+ years +63 +No. of different UK communities we are +directly invested in or manage assets within +96 +FY23 investor meetings +See page 22 for more information See page 24 for more information See page 26 for more information +Our capital partners +Capital partnerships are an important part +of our business, contributing to overall +earnings growth. Our capital partners +leverage our market leading platform by +allowing us to manage and improve the +performance of their assets. Capital +partnerships allow us to acquire assets in a +capital light way and receive proportional +rental income, as well as enhance our +returns from asset management fees with +the potential to receive financial promotes +linked to performance. +Our occupiers +When our occupiers thrive then so too can +NewRiver. We continuously nurture our +working relationships with our occupiers +so we can better understand their needs +and potential challenges or opportunities +and ensure our portfolio is best placed to +accommodate them. +We are proud to see so many of our +occupiers choose to remain in our portfolio +at the point of potential exit. +Our environment +The real estate industry has a critical role to +play in protecting the long-term sustainability +of our planet. We take our role as the +custodians of assets within the community +very seriously, and that involves integrating +our sustainability strategy across all aspects +of our business from head office to asset level +and our local communities. +24 +Number of capital partnership assets +under management (April 2023) +19 x retail parks and 5 x shopping centres +92% +FY23 occupier retention rate +1st +NewRiver ranked first place in the +GRESB Management module out of +901 participants across Europe +See page 44 for more information See page 6 for more information See page 58 for more information +NewRiver was named in the +Sunday Times Best Places +to Work 2023 +We are delighted to have been acknowledged post- +period in the ‘small organisation’ category (10-49 +employees) in The Sunday Times Best Places to +Work 2023 for our wide-ranging benefits package +and ongoing commitment to supporting our team and +their career development in a collaborative, diverse +and inclusive culture. +See page 20 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_22.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_22.txt new file mode 100644 index 0000000000000000000000000000000000000000..d38bf37d01c5c64e3ebec21142d22cf280e7749f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_22.txt @@ -0,0 +1,53 @@ +OUR STAKEHOLDERS +The success of our business is underpinned by our best in class +team and effective relationships with our multiple stakeholders. +We are proud of our highly motivated, collaborative and well-balanced +team with a near 50:50 gender split. Our team continue to focus on +helping drive the business forward whilst also advancing their own +career development. We foster strong working relationships with +our wider stakeholders who collectively help us deliver on our +strategy, business model and ongoing success. We recognise that +our stakeholders have a range of varying priorities and concerns +and we endeavour to incorporate these into our own strategic +decision-making. +Board engagement +Critical to effective corporate Governance is how the Board aligns +strategic decisions with the Company’s purpose, values, strategy and +stakeholders. The NewRiver Board has a clear stakeholder engagement +plan, regularly consulting with the NewRiver team, who in turn manage +and foster the relationships with our occupiers, key partners and advisers. +Stakeholder engagement +Authentic stakeholder engagement +underpins our business +NewRiver was named in the Sunday +Times Best Places to Work 2023 +We are delighted to have been acknowledged in May 2023 in the +‘small organisation’ category (10-49 employees) in The Sunday Times +Best Places to Work 2023 for our wide-ranging benefits package and +ongoing commitment to supporting our team and their career +development in a collaborative, diverse and inclusive culture. +We received positive survey results with strong approval and +engagement ratings of 82% with a “confidence in management” +score of 80% and achieved a rate of “Excellent” across all areas. +At NewRiver we provide a flexible working environment to suit the +different lifestyles of our team, and important policies including +full-private medical cover, ‘gender-agnostic’ shared parental leave and +wider flexible working patterns were recognised by the Sunday Times. +Our commitment to offering colleagues practical support for career +development and empowerment, providing the best possible +opportunity for them to develop their careers was also recognised. +The Sunday Times equally acknowledged that our team are rewarded +with a fully paid six-week sabbatical after 10 years of service. +Our Stakeholders include: +Local +Authorities +Shareholders +Environment +Occupiers +Capital +Partners +Team +Lenders +Communities +20 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_23.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_23.txt new file mode 100644 index 0000000000000000000000000000000000000000..e31b1b2ab6855eae58ffc948740b85f5f2392ebe --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_23.txt @@ -0,0 +1,89 @@ +“At NewRiver people are our greatest asset and it is +therefore an honour to have been named in The +Sunday Times Best Places to Work 2023. The fact that +75% of the NewRiver team have been at the company +for more than five years is testament to the positive +working environment and culture that we have built. +We are a driven, collaborative and well-balanced team +with a near 50:50 gender split and indeed it is the +team themselves that actively participate in creating +such a positive and attractive environment. I would like +to take this opportunity to thank the entire NewRiver +team for all their hard work in helping to continue to +drive the business forward. It would not have been +possible without each and every one of them.” +Edith Monfries +Chief Operating and People Officer at NewRiver REIT +46 +Employees +75% +Of our team have +worked at NewRiver +for 5+ years +26 +Hours of training per +employee this year +1,150 +Total hours of +training this year +70% +Of our team undertook +professional training  +during the year +64% +Of our team have +professional +qualifications +94 +Hours of volunteer support +dedicated to the Trussell Trust +SECTION 172(1) STATEMENT +The Directors consider, both individually and collectively, that they have acted in the way they consider, in good faith, would be most likely to +promote the success of the Company for the benefit of its members as a whole (having regard to the stakeholders and matters set out in +section 172(1)(a-f) of the Companies Act 2006) in the decisions taken during the year ended 31 March 2023. +Details of our key stakeholders and how the Board engages with them can be found in the strategic report on page 20. Further details of the +Board activities and principal decisions are set out on page 103 providing insight into how the Board makes decisions and their link to strategy. +Other disclosures relating to our consideration of the matters set out in s172(1)(a-f) of Act can be found as follows: +S172 factor Our approach +the likely consequence of any +decision in the long term +As a Board of a REIT owning assets which also include a risk-controlled development pipeline, the Board +is always conscious of the long term. Looking to the future the Board and Executive Committee regularly +assess the overall corporate strategy and acquisition, asset management and disposal decisions in the +context of current and future long-term trends and markets. We closely assess the latest trends reported +by CACI, our research provider, to ensure we are aligned with evolving trends. These insights and the +Board’s own extensive experience steer the long-term strategic direction. +the interests of the +company’s employees +We have a small workforce which allows a naturally close proximity between them and the Board making +it easy for the Board to engage with staff directly especially as the Directors regularly visit the London +office and other sites. This year the Directors have been able to visit the assets and the London office +more freely and attend social events with staff. +the need to foster the company’s +business relationships with +suppliers, customers and others +The Board is committed to fostering the Company’s business relationships with occupiers, local +authorities and other stakeholders. These stakeholders are key to our business model and therefore +members of the Exco (including Board members) have direct responsibilities for managing and +developing these relationships. Board site visits during the year have helped these relationships and +understanding the needs of these stakeholders. +the impact of the company’s +operations on the community +and the environment +The Board is committed to our communities and our assets are integral to the communities they serve. +We aim to enhance the lives of consumers and minimise our impact on the environment. These matters +are therefore considered in all strategic decisions and embedded into the business model. +the desirability of the company +maintaining a reputation for high +standards of business conduct +Our values mirror our culture and as a team our values are to be trusted and respected and this is +entrenched into Board decisions. Staff receive regular training on our anti-corruption policies to ensure +that they are entrenched in all staff decisions and conduct. Again the size and proximity of the workforce +allows our values to be communicated, embedded and monitored easily and less formally. +the need to act fairly as between +members of the company. +The Board recognises the importance of treating all members fairly and monitors the views of the +Company’s shareholders through reports on investor and analyst communications so that their views and +opinions can be considered when setting strategy. +21NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret object #5 is a "towel". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_24.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..a01911f4cb4ed719236c8a513a8b4f7bbc01459a --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_24.txt @@ -0,0 +1,97 @@ +Recruitment and talent +Our total head count across the Group at the close of the year was +46. Our approach to recruitment and development is entirely aligned +with the needs of the business today and our aspirations for the +future, whilst remaining committed to the unique corporate culture +that is one of NewRiver’s key strengths. +We are continuously working to develop the skills, capability and +performance of all employees. Our support ranges from funding +professional qualifications including RICS and ACCA to informal +training sessions and a bi-weekly team meeting to empower the team +with research and knowledge to help enhance their day-to-day role. +We continue to support the UK Government’s Apprenticeships +Scheme. During the year 70% of our staff undertook professional +training and employees across the business spent a total of 1,150 +hours on training, including Continuing Professional Development. +We appraise our team annually, undertaking a tailored performance +review which includes a professional development plan which allows +our team to set objectives, track progress and fulfil their potential. +Diversity +As a Company, we are committed to a culture of diversity and +inclusion in which everyone is given equal opportunities to progress +regardless of gender, race, ethnic origin, nationality, age, religion, +sexual orientation or disability. Our ethnicity representation is 17%. +We also have a Diversity and Representation committee who meet +regularly to promote inclusion across the business. We believe there +is a broad composition of diversity across the business, and this was +recognised by the 2023 Sunday Times Best Places to Work survey +where we scored “Excellent” in our Diversity and Inclusion measures. +Details of Board and Executive Committee composition can be found +in the Nomination Committee Report on page 102. +Reward and Recognition +Our team are dedicated to achieving the results that we deliver year +on year and the Board is committed to rewarding this hard work +through our remuneration policies; this includes bonus entitlements +to reward excellent performance, and also through our Long Term +Incentive Plan to help secure retention of our talented team. +The Company offers a range of benefits to our team, some particular +highlights include: +• flexible hybrid working with 3:2 days split in the office/on site: at home +• full private medical cover for all staff +• ‘gender-agnostic’ shared parental leave +• training and career development +• an electric car scheme +• six week paid sabbatical to employees who have been with the +business for 10+ years +• mental and physical health resources and training +• staff volunteering policy enabling staff to take time off to volunteer for +our charitable partner The Trussell Trust or a charity of their choice +The team also have the opportunity to discuss the benefits available +with specialist advisers to ensure that they suit their needs. We +review the benefits each year to ensure they meet employee +expectations and industry benchmarks. +Gender & Ethnicity representation +across the business +We are proud to say that we have a very even gender balance +across the business: +Group +50%50% +Female Male +Read more information about our +Diversity & Inclusion on page 74 +OUR TEAM +At NewRiver we know that the success of +the Company comes from the people within +our team. +Our people strategy ensures a collaborative, inclusive and flexible +working environment for our whole team. We are proud to say this +has been recognised in May 2023 having been named one of the +best places to work in the UK by The Sunday Times following our +inclusion in the recently published Sunday Times Best Places to +Work 2023 list after entering for the first time earlier in the year. +Communication, collaboration and respect sit at the heart of our +people strategy which harnesses the power of the team to drive +our business forward. +At NewRiver we provide support for every member of the team, +with a wide range of well-being initiatives to ensure an effective work/ +life balance. Training and Development is key to empowering our +loyal team and ensuring that everyone has a chance to unlock their +full potential. +Our flexible working policy fosters a positive working environment +to suit the different lifestyles of our team. As well as flexible working, +we offer an attractive and wide-ranging benefits package including +full-private medical cover and ‘gender-agnostic’ shared parental +leave together with training and career development in a collegiate, +diverse and inclusive culture. Long-serving team members are also +rewarded with a fully paid six-week sabbatical following 10 years of +service; and we also offer an opt-in salary sacrifice for electric cars +and a policy enabling staff to take time off to volunteer. Our high staff +retention testifies the team satisfaction with over 75% of our staff +having worked at NewRiver for 5 years’ or more. +17% +Ethnicity +Representation +22 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Stakeholder engagement continued +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_25.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..a513f98f0cd27c0d4b2728cc45ff880ba1e596b8 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_25.txt @@ -0,0 +1,85 @@ +Board Engagement during the year +Our Board have a comprehensive +engagement strategy working to engage +the wider team, including an active outreach +programme with Board Directors visiting +assets to meet the centre management +teams, our occupiers and local authorities. +A regular staff forum ensures that there is effective communication +and interaction between the Board, Senior Management and the +wider Team. We regularly provide the opportunity for our Non- +Executive Directors to meet the team both formally and informally, +both in confidence or in wider forum. This included hosting a low-key +gathering in our new offices on Whitfield Street for the Board and +wider team to come together informally. +Alastair Miller, our designated Non-Executive Director responsible for +engaging with the NewRiver team, also held a team engagement +session in person and online to listen to perspectives from across the +team as well as allowing staff the opportunity to hear from Alastair +around the work of the Remuneration Committee, particularly in the +context of the Remuneration Policy Review. +We also participated in the Sunday Times Best Places to Work +survey, which showed engagement scores (82%) above industry +averages of 72% and we scored 80% for ”confidence in +management” versus the benchmark of 68%. +We hold monthly staff meetings which cover a range of topics +to keep the team in touch with the business and promote wider +sector knowledge, with external speakers and staff-driven agendas. +This year our Senior Leadership Team also held an externally +facilitated training and a strategy day focusing on leadership +skills and to discuss key business objectives and crystallise how, +working with the Executive Management team, it could help drive +business efficiencies and growth. +Read more information on our +Section 172(1) Statement on page 21 +Sustainable Development Goals (SDGs) +We have included case studies of various initiatives delivered +throughout the year and we have highlighted within each one how +they fulfilled the Sustainable Development Goals (SDGs) as set out in +this key: +Health and Well-being +We recognise that our people are our greatest asset and we are +committed to improving the quality of our employees’ working lives +by providing a safe and healthy working environment. Our aim is to +create a positive working environment by integrating well-being in all +work activities and by empowering our people to make positive +choices regarding their health and well-being. +Physical Environment +and Flexible Working +This year we relocated to a new office space on Whitfield Street in +Fitzrovia. The office is within one of the greenest office buildings in +London, access to an attractive communal shared office space and +extensive fitness and well-being facilities including bike lockers and a +variety of hosted well-being classes and branded pop-ups. The +London office space is open plan with hot-desks which has helped +our team become more digitally-centric and print less paper. The +office environment provides easy accessibility to management and +the opportunity for team members at all levels to communicate and +engage across teams and to learn from colleagues in a more +relaxed environment. +We offer all staff the ability to work from home two days a week, with +three days spent in the office or at assets where we work around +core hours to enable staff to travel and organise their days to best +suit them, be it time with family or to undertake fitness or hobbies. +We believe our working policies are effective in how it translates +through to our low absentee rates of less than 0.1%. +Our dedicated Diversity and Representation Committee meet +regularly and implement initiatives to engage and motivate the +wider team. +Mental Health +The pandemic helped shine a brighter spotlight on the importance of +ensuring good mental health. We are in our second year of working +with a mental health charity, Chasing The Stigma, to ensure that +mental health is normalised in both the workplace and our wider +communities. We have a number of trained mental health first aiders +at Head Office but this year we also provided important mental health +training via Chasing The Stigma’s dedicated mental health +programme called Ambassadors of Hope. Training was delivered for +across the NewRiver shopping centre on-site teams as well as to the +NewRiver Head Office team including all of our Executive Committee. +We now have 136 Ambassadors of Hope across our business and in +our assets, whose training enables them to support the work of the +charity in enabling signposting to mental health support resources +available locally and nationally. +Find out more here: www.chasingthestigma.co.uk +23NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_26.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c17e40495697d11a5728be37fec33f8ca242935 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_26.txt @@ -0,0 +1,87 @@ +How did we engage? +• Staff Forum and bi-weekly all staff briefing meetings +• Sunday Times Best Places to Work Survey 2023 +• Regular Non-Executive Director office visits to allow the Board to +interact with and listen to the wider team +• Our comprehensive appraisal process with individual performance +reviews and development discussions +• Chasing The Stigma “Ambassador of Hope” mental health training +conducted at Head Office and across our shopping centres; all of +our Executive Committee undertook this important training +• Alastair Miller, our designated Non-Executive Director responsible +for engaging with employees, has held team engagement sessions +• Board Directors visited assets across the portfolio to better +understand the assets and spend time with the property team and +local on-site teams +Topics raised +• Leadership and Strategy +• Opportunities for personal and career development +• Knowledge sharing across the Company +• Well-being and flexible working +• Rewards and benefits +• Fostering a diverse and inclusive culture +• Our ESG strategy +How did we respond? +• Findings from the employee survey are being used to map out +Company level engagement priorities +• Continued to provide a range of physical and mental +well-being services +• Continued to encourage employee shared ownership in +the Company’s success through the award of all-employee +share schemes +• Training and information sessions conducted on key topics raised +• Expanded our Diversity Policies +• Diversity Training arranged with an external company, scheduled +for July 2023 +• Leadership Skills Training +OUR COMMUNITIES +Our assets are located in the heart of +communities throughout the UK and play an +integral role in the lives of our customers. +Supporting our Communities in +the Cost-of-Living Crisis +The social enterprise, Green Rose, spent a month at the Arndale +Centre, Morecambe offering the local community free advice +and support on energy issues. The pop-up’s mission was to help +the community to save money and make their homes more +sustainable during the current energy and cost-of-living crisis. + +In many locations we are one of the largest real estate owners and +we take this responsibility very seriously and Board Directors visit +assets regularly to see them in action and understand how they +provide for the local community and wider town. We aim to +strengthen the communities we operate in providing for the everyday +needs of locals through our shops and services and supporting the +causes that matter to them. +Read more about our community engagement +initiatives on pages 25, 57, 77 and 78 +Board Engagement during the year +How did we engage? +• Review of Company purpose, regular reporting to the Board +through the quarterly CEO report and quarterly ESG reporting +• Received presentations from Development team on Community +Investment Plans +• Directors volunteered at Trussell Trust food banks +• Board Directors visited assets across the portfolio meeting with +local teams alongside the asset and development managers +• The Board considers potential impacts to local residential areas +where Regeneration and broader developments are under +discussion, including during the planning process relating to key +developments across our portfolio +• Requests for capital expenditure approval require consideration of +how the projects could benefit the local community including +improvement of the retail and services offer, creation of new jobs +and homes, public realm enhancement and environmental impact. +• Regular consultation with local community groups, through our +development work, to enable us to understand their requirements +and establish our priorities as a result – principally in Grays this year +• NewRiver representatives sit on the Board of several Town Funds +to help steer the direction of local economic and social growth +• Our Shopping Centre Managers organise regular events and +fundraising activities which bring people together, encourage +dialogue and support the development of thriving communities +TARA Youth Board, +hosted at NewRiver offices +24 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Stakeholder engagement continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_27.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..a59dcc59d114ca4d5c77ee2bda32346ce3c5e3a8 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_27.txt @@ -0,0 +1,97 @@ +OUR OCCUPIERS +When our occupiers thrive, so too can we. +We continuously nurture our working relationships with our +occupiers, so we can better understand their needs and potential +challenges or opportunities. We have hand-picked our portfolio to +focus on occupiers that provide essential goods and services and to +support the development of thriving communities across the UK, +while deliberately avoiding structurally challenged sub-sectors such +as department stores and mid-market fashion. +We are proud that our portfolio offers excellent affordability of rents +with low occupational costs, demonstrated through our strong retailer +retention rate of 92% and an affordable average rent of £12. Our +on-site teams work hard to ensure that our assets are clean, safe, and +welcoming environments for all ages. +Board Engagement during the year +How did we engage? +• Regular retailer engagement underpins our asset management +strategy including regular meetings between Board Directors, +Executive Directors and our asset teams with our key occupiers, +listening to challenges and opportunities arising from the shop +floor to retailer head offices which is fed into our planning and +informs our strategy +• Part of these conversations with our retailers include our +environmental and sustainability strategies, including green leases, +enhanced data collection and on-site energy consumption +• The Board receives regular reports on occupier activity through +Exco reports and ESG reporting to inform future strategy +• The asset management team attend the annual Completely Retail +Marketplace in London where the retail real estate industry come +together to discuss new opportunities as well as expand and +consolidate existing leasing plans and asset management +initiatives +• Non-Executive Directors have attended industry conferences +alongside Executive Directors +Topics raised +• Topics raised via retailer and occupier meetings include +understanding the future needs of occupiers including sentiment, +performance, growth/contraction plans, sustainability initiatives and +potential opportunities and risks within our occupier base, green +leases and MEES compliance. +How did we respond? +• Continuing to collect energy data from our occupiers and assets +• Engagement with our occupiers regarding our Pathway to Net Zero +to help align with the occupier’s net zero ambitions +• Assisting with Business Rate reductions for our occupiers +• Board Directors sit on various industry committees helping shape +policy and strategy. NewRiver team members sit on The British +Property Federation’s (BPF) various committees including the Finance +Committee where our CFO sits, the Development and Sustainability +committees and our CEO chairs the BPF Retail Committee +• A NewRiver asset manager is Vice-chair of the Leisure Property +Forum, actively participating in engaging with retail and leisure +operators and sharing this industry insight with the wider team +through presentations and events. +• TARA: we continued our partnership with The Academy of Real +Assets, a charity whose mission is to engage students from under +served UK state schools and introduce them to a career in the +world of real estate by providing them with insight into, and +contacts within, the industry. One of our development managers +chairs and hosts the TARA Youth Board helping drive this agenda +Topics raised +• Town centre regeneration +• Creating long-term social and economic prosperity +• Responsible planning, development and design +• Community well-being and social value +• Environmental protection +How did we respond? +• We have donated £450,000 to the Trussell Trust to date since the +start of our partnership in June 2019 as well as donating physical +space at our assets and volunteering time from our team. +• Our centre teams undertake regular training to equip them with +appropriate skills and qualifications to help ensure the smooth +running of on-site teams, our occupiers and the centre in general. +• Enhanced social media use for community engagement. +Stopping UK Hunger +Since the inception of our partnership with the Trussell Trust, we +have raised over £450,000 in support of their mission to stop +UK hunger. Non-monetary support has included circa 10.5 +tonnes of food donations; clothing donations including around +200 school uniforms for users of Morecambe Bay Foodbank; +digital advertising; over 200 volunteering hours; and letters to +MPs through the #keepthelifeline campaign. + +“You are Important” +Our centre The Horsefair in Wisbech partook in the “You Are +Important” campaign, a large-scale collaborative art project +which involved Wisbech-based businesses and organisations +working with artists and local people to create a visual +celebration of every member of the community. Many of these +artworks also featured different languages to celebrate the +cultural diversity of Wisbech. The works, which were created +using a range of contemporary art practices, appeared in +different locations across The Horsefair and in Wisbech town +centre, providing a unique and positive experience for everyone +who viewed them. + +25NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_28.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_28.txt new file mode 100644 index 0000000000000000000000000000000000000000..b362825a4c22d9f7b891ce0ed9689e8f55e6ec2c --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_28.txt @@ -0,0 +1,107 @@ +• The Board receives regular updates on market sentiment, +investor relations activity and share price performance +• The Remuneration Committee undertook a review of the +Remuneration policy in consultation with Shareholders for +which Shareholder provided positive support toward the +proposed revisions. +Topics raised +• Continued delivery of the Company’s revised strategy focused on +resilient retail following the pub business disposal in FY22 +• Financial performance +• Operational performance +• Capital allocation +• Portfolio valuation performance +• Progress on the disposal of our Work-Out portfolio +• Progress across our Regeneration portfolio +• Growth of Capital Partnerships +• Sustainability +• Retailer challenges and opportunities +• Macro-economic themes including how inflation and rising energy +costs impact our retailer +How did we respond? +• Post pandemic virtual engagement continue to form a part of our +Investor Relations programme, allowing us to capitalise on +effective use of management time, engaging with international and +regionally based investors, and helping reduce associated carbon +emissions +• Our investor feedback has helped enhance our disclosures and +the supplementary information provided in results materials. +OUR LENDERS +We have strong working relationships with +our banks, bondholders and rating agency +who in turn help provide funding to facilitate +our strategy. +As part of this, we are in regular dialogue to ensure our banks and +bondholders understand the Company’s strategy and targets. These +relationships have helped ensure that the business remains in a +strong and flexible financial position with a fully unsecured balance +sheet. This structure is highly efficient and covenant-light, affording +us significant operational flexibility. +Board Engagement during the year +How did we engage? +• The CFO and finance team held regular meetings with our +relationship banks, bondholders and rating agency to ensure +that they are kept up to date with business strategy, developments +and performance +• Held meetings with our Bondholders as part of our FY22 and +HY23 results roadshow +• Debt structure and current and future debt requirements are +considered by the Board on a regular basis as part of the +CFO’s review +OUR SHAREHOLDERS +Our shareholders are the ultimate owners +of our business. In order to deliver on all +our ambitions for the communities we are +invested in, it is critical that our shareholders +continue to understand and support the +Company’s strategy, business model, +investment case and progress. +We have an active engagement strategy, supported by our corporate +brokers, providing our shareholders with frequent business updates, +regular meetings, both in person and online, and on-site visits. +Where appropriate, our Board and members of the Executive +Committee will engage with shareholders. +The comprehensive calendar of investor engagement includes the +AGM, regulatory announcements and non-regulatory news flow, +conference calls and shareholders roadshows, as well as regular +contact with financial analysts, financial media, investors, private +client fund managers, retail investors and equity sales teams. Regular +and targeted engagement ensures that our strategy, business model +and investment case are well understood by shareholders and the +wider market. +Board Engagement during the year +How did we engage? +• Focused virtual and face to face investor meetings with +the CEO and CFO with a revival of face to face meetings +• Engagement includes the AGM, regulatory announcements, +conference calls and investor roadshows, as well as regular +contact with financial analysts, financial media, investors, private +client fund managers, retail investors and equity sales teams +• As well as institutional investors, we engage with retail investors +via direct communications, our website, media, Annual General +Meetings (AGM) and platforms including Investor Meet, hosting +a dedicated retail investor presentation at our half year results +• Our relaunched corporate website contains comprehensive +information about our business, regulatory news and press +releases alongside information about our approach to +Environmental, Social and Governance (ESG) issues +• Management engaged with 96 investors during the year, including +shareholders and non-holders, and institutional and +retail investors +• We hosted our first post-pandemic in-person results presentation +to analysts in November 2022 for our HY23 Results – a live audio +webcast was also available our website with a replay function +• The 2022 AGM was again held as a physical meeting and was +attended by all of the Board. Recognising that some shareholders +may not have been comfortable attending in person, we provided +opportunities for shareholders to submit questions via email and to +attend via conference call +• The Board reviews and approves material and communications +with investors, namely trading updates, results announcements, +the Annual Report and Accounts, and significant business events +and transactions. +• The respective Committee Chairs engage with shareholders on +significant matters related to their specific areas of responsibility +26 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Stakeholder engagement continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_3.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_3.txt new file mode 100644 index 0000000000000000000000000000000000000000..36c9877b069349dc2a748de183768b1cf882cdec --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_3.txt @@ -0,0 +1,34 @@ +RESILIENTRESILIENT +RETAILRETAIL +ROBUST +MARKET DYNAMICS +Our portfolio positioning, focused on essential +goods and services, where a physical store is vital +to our occupiers, is the reason for the underlying +resilience of our operating performance. +See page 12 +AGILE +PLATFORM +Our market leading asset management platform draws +on the in-house expertise of our team, our deep market +knowledge and excellent occupier relationships to +enhance and protect income streams for our assets +both on our own balance sheet and those we manage +on behalf of our capital partners. +See page 42 +STRONG +FINANCIAL POSITION +Our balance sheet is fully unsecured and well +positioned to support our future growth with +significant cash holdings, no debt maturity until +2028 and no exposure to interest on drawn debt. +See page 46 +FOCUSED +PORTFOLIO +Our resilient portfolio provides affordable, +well-located and omnichannel compatible space +for successful and expanding occupiers reliant on +a physical store network. +See page 6 +1NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret object #1 is a "chair". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_30.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..8faacfa86b2ca6364078585ffc93b565f2c47d27 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_30.txt @@ -0,0 +1,84 @@ +Key performance indicators +Measuring our +strategic progress +Underlying Funds From Operations +£25.8m +28.3 +11.5 +52.1 +55.1 +25.8 +2019 +£m +2020 2021 2022 2023 +Loan to Value +33.9% +34.1 +50.6 +47.1 +36.9 +33.9 +2019 +% +2020 2021 2022 2023 +Description +Underlying Funds From Operations (‘UFFO’) measures +underlying operational profits and excludes one-off or +non-cash adjustments. We consider this to be the most +appropriate measure of the underlying performance of the +business, as it reflects our generation of operating profits. +Description +Loan to Value (‘LTV’) is the proportion of our properties that +are funded by borrowings. The measure is presented on +a proportionally consolidated basis. Maintaining an LTV of +less than 50% is one of our five key Financial Policies and in +addition our medium-term guidance is to maintain an LTV +of less than 40%. +Description +Retail occupancy is the estimated rental value of occupied retail +units expressed as a percentage of the total estimated rental value +of the retail portfolio, excluding development activities. +Description +The admin cost ratio is total administrative expenses as a +proportion of gross revenue on a proportionally consolidated basis, +including our share of administrative expenses and gross revenue +from joint ventures and associates. It is a measure of our +operational efficiency. +Our performance +Total UFFO for FY23 was £25.8 million down from a total UFFO +of £28.3 million in FY22. This is following disposal of the +Hawthorn pub business. However on a underlying retail only +basis this is up 26% from £20.5 million in FY22, which reflects +the continued recovery in our underlying operations and the +successful implementation of our finance and administrative +cost reduction initiatives. +Our performance +LTV has remained stable at 33.9% as at 31 March 2023, +reducing from 34.1% as at 31 March 2022, comfortably within +our guidance of <40%. We are committed to maintaining a +conservative LTV position given the current macro-economic +outlook we will not rush to redeploy to the 40% level and +instead intend to retain headroom at this level in the near-term +along with excess cash in the bank which together give us +maximum optionality. +Our performance +We achieved our highest occupancy level for five years, with +a high, stable retail occupancy of 96.7%, up from 95.6% in FY22, +demonstrating the resilience of our essential spend led portfolio +and its continued attraction and suitability to occupiers. +Our performance +Our admin cost ratio was 15% for FY23 achieving a +reduction from 17% in FY22 principally following a reduction +in administrative costs due to the disposal of the Hawthorn +business and the unlocking of administrative cost efficiencies. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +28 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +The secret transportation is a "train". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_31.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..c7241d38e0b5bb24e62051490eb32a364749ff04 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_31.txt @@ -0,0 +1,88 @@ +Retail occupancy +96.7% +95.6 +95.8 +94.8 +95.2 +96.7 +2019 +% +2020 2021 2022 2023 +Admin cost ratio +15% +17 +25 +15 +13 +15 +2019 +% +2020 2021 2022 2023 +Description +Underlying Funds From Operations (‘UFFO’) measures +underlying operational profits and excludes one-off or +non-cash adjustments. We consider this to be the most +appropriate measure of the underlying performance of the +business, as it reflects our generation of operating profits. +Description +Loan to Value (‘LTV’) is the proportion of our properties that +are funded by borrowings. The measure is presented on +a proportionally consolidated basis. Maintaining an LTV of +less than 50% is one of our five key Financial Policies and in +addition our medium-term guidance is to maintain an LTV +of less than 40%. +Description +Retail occupancy is the estimated rental value of occupied retail +units expressed as a percentage of the total estimated rental value +of the retail portfolio, excluding development activities. +Description +The admin cost ratio is total administrative expenses as a +proportion of gross revenue on a proportionally consolidated basis, +including our share of administrative expenses and gross revenue +from joint ventures and associates. It is a measure of our +operational efficiency. +Our performance +Total UFFO for FY23 was £25.8 million down from a total UFFO +of £28.3 million in FY22. This is following disposal of the +Hawthorn pub business. However on a underlying retail only +basis this is up 26% from £20.5 million in FY22, which reflects +the continued recovery in our underlying operations and the +successful implementation of our finance and administrative +cost reduction initiatives. +Our performance +LTV has remained stable at 33.9% as at 31 March 2023, +reducing from 34.1% as at 31 March 2022, comfortably within +our guidance of <40%. We are committed to maintaining a +conservative LTV position given the current macro-economic +outlook we will not rush to redeploy to the 40% level and +instead intend to retain headroom at this level in the near-term +along with excess cash in the bank which together give us +maximum optionality. +Our performance +We achieved our highest occupancy level for five years, with +a high, stable retail occupancy of 96.7%, up from 95.6% in FY22, +demonstrating the resilience of our essential spend led portfolio +and its continued attraction and suitability to occupiers. +Our performance +Our admin cost ratio was 15% for FY23 achieving a +reduction from 17% in FY22 principally following a reduction +in administrative costs due to the disposal of the Hawthorn +business and the unlocking of administrative cost efficiencies. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Key +Link to business model and strategic objectives +1 Disciplined capital allocation +2 Leveraging our platform +3 Flexible Balance Sheet +Link to ESG and Remuneration +ESG Environmental, Social +and Governance +£ Remuneration +29NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_32.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..efdf6f0ac91cc5736da9db62e2bf076bbd7ab6f5 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_32.txt @@ -0,0 +1,85 @@ +Key performance indicators continued +Description +Interest cover is the ratio of our operating profit to our +net financing costs, on a proportionally consolidated basis, +including our share of operating profit and net financing +costs from joint ventures and associates. Maintaining interest +cover of more than 2.0x is one of our five key Financial Policies. +Description +GRESB is the leading sustainability benchmark for the global +real estate sector. Assessments are guided by factors that +investors and the industry consider to be material in the +sustainability performance of real estate asset investments, +resulting in an overall score marked out of 100. Improvements +in our GRESB score can be used to measure the effectiveness +of our ESG programme. +Description +Total Property Return is a measure of the income and capital +growth generated across our portfolio. It is calculated +by MSCI Real Estate (formerly known as IPD) on our behalf, +using independent valuers. We assess our performance +against the market by comparing our returns to the MSCI +All Retail benchmark. +Description +Total Accounting Return (‘TAR’) is the change in EPRA Net +Tangible Assets (‘NTA’) per share over the year, plus dividend +paid, as a percentage of the EPRA NTA at the start of the year. +TAR performance relative to UK-listed Real Estate Investment +Trusts is a key metric used in setting the long-term incentive plan. +Our performance +Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in +FY23 due to the actions we completed in the prior year +including the debt reduction following the Hawthorn pub +business disposal, continued improvement of underlying retail +operations and the cash return we are generating by placing +our surplus cash on deposit. This level provides significant +headroom to our policy of 2.0x. +Our performance +This year we ranked 1st in the GRESB Management module +out of a 901 participants across Europe. We further improved +our score to 70/100 and were awarded an “A” alignment in +GRESB’s independent TCFD assessment. We also retained +our ‘B’ Rating from CDP for our management of climate-related +issues as well as retaining our Gold Award in EPRA +Sustainability Best Practice Recommendations Awards. +Our performance +Our portfolio delivered a Total Return of 2.3% in FY23 +compared to the MSCI All Retail benchmark at -7.9% due to the +inherent high income component of our portfolio. +Our core shopping centres and retail parks delivered capital +returns of -0.7% and -3.2%. +Our performance +We delivered a total accounting return of -4.6%, impacted by +the portfolio valuation decline of -5.9%, compared with -6.6% in +the prior year. We paid a 6.8 pence dividend for the year, offset +by movement in NTA. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +£ ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Interest cover +4.3x +3.5 +2.3 +4.8 +5.1 +4.3 +2019 +ratio +2020 2021 2022 2023 +GRESB Score +70 +68 +60 +70 +62 +70 +2019 +number +2020 2021 2022 2023 +30 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_33.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..bed78af5e2a233a266c53bacd1bb060c6afd165a --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_33.txt @@ -0,0 +1,92 @@ +Key +Link to business model and strategic objectives +1 Disciplined capital allocation +2 Leveraging our platform +3 Flexible Balance Sheet +Description +Interest cover is the ratio of our operating profit to our +net financing costs, on a proportionally consolidated basis, +including our share of operating profit and net financing +costs from joint ventures and associates. Maintaining interest +cover of more than 2.0x is one of our five key Financial Policies. +Description +GRESB is the leading sustainability benchmark for the global +real estate sector. Assessments are guided by factors that +investors and the industry consider to be material in the +sustainability performance of real estate asset investments, +resulting in an overall score marked out of 100. Improvements +in our GRESB score can be used to measure the effectiveness +of our ESG programme. +Description +Total Property Return is a measure of the income and capital +growth generated across our portfolio. It is calculated +by MSCI Real Estate (formerly known as IPD) on our behalf, +using independent valuers. We assess our performance +against the market by comparing our returns to the MSCI +All Retail benchmark. +Description +Total Accounting Return (‘TAR’) is the change in EPRA Net +Tangible Assets (‘NTA’) per share over the year, plus dividend +paid, as a percentage of the EPRA NTA at the start of the year. +TAR performance relative to UK-listed Real Estate Investment +Trusts is a key metric used in setting the long-term incentive plan. +Our performance +Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in +FY23 due to the actions we completed in the prior year +including the debt reduction following the Hawthorn pub +business disposal, continued improvement of underlying retail +operations and the cash return we are generating by placing +our surplus cash on deposit. This level provides significant +headroom to our policy of 2.0x. +Our performance +This year we ranked 1st in the GRESB Management module +out of a 901 participants across Europe. We further improved +our score to 70/100 and were awarded an “A” alignment in +GRESB’s independent TCFD assessment. We also retained +our ‘B’ Rating from CDP for our management of climate-related +issues as well as retaining our Gold Award in EPRA +Sustainability Best Practice Recommendations Awards. +Our performance +Our portfolio delivered a Total Return of 2.3% in FY23 +compared to the MSCI All Retail benchmark at -7.9% due to the +inherent high income component of our portfolio. +Our core shopping centres and retail parks delivered capital +returns of -0.7% and -3.2%. +Our performance +We delivered a total accounting return of -4.6%, impacted by +the portfolio valuation decline of -5.9%, compared with -6.6% in +the prior year. We paid a 6.8 pence dividend for the year, offset +by movement in NTA. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +£ ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to ESG and Remuneration +ESG Environmental, Social +and Governance +£ Remuneration +Total Property Return ++2.3% +7.5 +-6.9 +-5.4 +1.3 +2.3 +2019 +% +2020 2021 2022 2023 +Total Accounting Return +-4.6% +-6.6 +-24.9 +-14.7 +-3.3 +-4.6 +2019 +% +2020 2021 2022 2023 +31NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_34.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_34.txt new file mode 100644 index 0000000000000000000000000000000000000000..9585f4d863fdeea6faeaddfb4bbf375aed4846f2 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_34.txt @@ -0,0 +1,39 @@ +FOCUSED +PORTFOLIO +As the leading UK retail real estate +company we understand what makes +a resilient retail asset and we know how +to protect and enhance resilience over +the longer term. +RESILIENT RETAIL +28% +11% +23% +1% +37% +Retail Parks + Shopping Centres +– Core + Shopping Centres +– Regeneration +Shopping Centres +– Work Out +Other +28% +11% +23% +1% +37% +Retail Parks + Shopping Centres +– Core + Shopping Centres +– Regeneration +Shopping Centres +– Work Out +Other +Portfolio Weighting +32 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Portfolio review +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_35.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_35.txt new file mode 100644 index 0000000000000000000000000000000000000000..89eb84d8e56cc08a3b9713c11d65fdcac105fa07 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_35.txt @@ -0,0 +1,80 @@ +Operational Update +Robust and consistent operational metrics continue to demonstrate the underlying resilience and active demand for space in our portfolio, +supported by the strong performance of the physical retail store channel and resilient consumer. Net property income adjusted for disposals +increased by +5.0% in the 12 months to March 2023, occupancy increased to 96.7% (FY22: 95.6%) and rent collection remains at normalised +levels of 98% (FY22: 96%). +As a 31 March 2023 Occupancy +Retention +Rate +Rent +Collection Affordable Average Rent +Gross to Net +Rent Ratio +Leasing +Volume +Leasing +Activity +Average CAGR +FY21-FY23 +(%) (%) (%) (£ psf) (Ave. pa) (%) (sq ft) +% vs valuer +ERV (%) +(Average +Lease Length) +Retail Parks 97.5% 100% 99% £12.49 £116,000 97% 163,400 0.8% 0.6% 12.3 +Shopping Centres +– Core 97.7% 90% 98% £13.18 £39,000 94% 309,700 2.3% -0.8% 9.9 +Shopping Centres +– Regen 97.4% 97% 100% £13.00 £69,000 86% 138,700 -3.9% -0.7% 9.4 +Shopping Centres +– Work Out 92.8% 89% 97% £9.13 £23,000 65% 338,800 -2.1% -0.4% 6.7 +Total1 96.7% 92% 98% £11.98 £45,000 88% 979,200 1.1% -0.4% 10.0 +1. Total includes Other representing 1% of total portfolio by value +In total, we completed 979,200 sq ft of leasing transactions during the year, securing £7.9 million of annualised income. Our long-term leasing +transactions which represented 69% of the total rent secured were transacted at rents +1.1% above valuer ERVs. +Over three quarters (77%) of the annualised long-term rent secured was in our Core Shopping Centre and Retail Park portfolios, at rents exceeding +valuer ERVs by +2.3% and +0.8% respectively. This is a reflection of the excellent occupational demand across our Core Shopping Centres, at the heart +of their local communities, and conveniently located Retail Parks predominately adjacent to major supermarkets, demonstrating we own the right assets +in the right locations. +OUR HIGHLIGHTS +Portfolio Metrics as at 31 March 2023 +Occupancy +96.7% +FY22: 95.6% +Retention Rate +92% +FY22: 90% +Rent Collection +98% +FY22: 96% +Leasing Volume +979,200 sq ft +FY22: 1,039,800 sq ft +Leasing Activity ++1.1% +ahead of valuer ERV +FY22: +7.4% +Affordable +Average Rent +£11.98 per sq ft +FY22: £11.74 per sq ft +Average CAGR +FY21-FY23 +-0.4% +on 10.0yr average +previous lease period +Gross to Net Rent Ratio +88% +FY22: 84% +Total Return +2.3%, +1,020 bps +outperforming the MSCI All Retail over 12 months +FY22: 7.5% +Portfolio NIY of +8.0%, +220bps +versus the MSCI All Retail at 5.9% +FY22: 7.9% +Expanding Capital Partnerships across public, +private equity and institutional sectors +33NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret shape is a "rectangle". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_36.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_36.txt new file mode 100644 index 0000000000000000000000000000000000000000..06d88e1ccdb515eabcf974337bf8e1199d259437 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_36.txt @@ -0,0 +1,108 @@ +Our Capital Partnerships continue to grow having secured a +high-quality mandate from M&G Real Estate in November 2022 to +asset manage a large retail portfolio, with a further south-east +shopping centre added to this mandate subsequent to our +appointment. The portfolio currently comprises 16 retail parks and +two shopping centres. Our key partnerships are across the public, +private equity and institutional sectors illustrate the importance of +specialist retail partners in a highly operational sector and +endorsement of the quality of our asset management platform. +Valuation +As at 31 March 2023, our portfolio was valued at £593.6 million +(31 March 2022: £649.4 million). Movements from the previous +year were the disposal of two Work Out assets and a solus retail +warehouse unit (£22.4 million) and a like-for-like valuation movement +of -5.9% for the year. This is a +660bps capital return outperformance +compared to the MSCI All Retail index. +Valuations were broadly stable in the first half of the year at -1.3%, +followed by a -4.7% movement in the second half, a reflection of the +macro-economic, political and financial market pressures impacting +all real estate markets. The valuation movement was predominately +a result of market driven yield expansion, a direct impact of rising +interest rates, whilst ERVs were broadly stable at -1.7% for the total +portfolio and +0.4% excluding our Work Out portfolio and +Regeneration assets. +Our Core Shopping Centre Portfolio, which represents 37% of the +portfolio, delivered a modest valuation movement of only -0.7% for +the year, a result of a strong operational performance and already +high yield of 9.6%. This is a +1,010bps capital return outperformance +compared to the MSCI Shopping Centre index. +Retail Parks, representing 28% of the portfolio, saw a movement +of -3.2% driven by some modest yield expansion offset by a ++2.7% increase in LFL ERVs. This is a +960bps capital return +outperformance compared to the MSCI Shopping Centre index. +The overall portfolio valuation movement was concentrated in the +Regeneration portfolio with a movement of -14.1% which accounts for +62% of the overall portfolio movement, the outcome of high inflation +on assumed construction and finance costs. +The Work Out portfolio following two disposals now accounts for +only 11% of the total portfolio and experienced a -7.8% valuation +movement due to negative NOI and ERV movements. This was +concentrated in three assets where turnaround strategies are in +place and progressing well. Nevertheless, on a capital return basis, +our Work Out portfolio outperformed the MSCI Shopping Centre +index by +10bps. + +Portfolio review continued +Whilst rent secured within our regeneration portfolio was down -3.9% +versus valuer ERV, it was 9.0% ahead of the previous passing rent +and therefore accretive to rental cashflows. It is also reflective of our +ongoing strategy to ensure greater lease flexibility to support our +vacant possession strategy. We have been making good progress +across our three regeneration assets which are predominantly +focused on reducing surplus retail and delivering new residential +units to these locations within commuting distance of London. At +Grays, we are at an advanced stage in our preparations to submit +an outline planning application for 850+ homes and in Burgess Hill, +a site with detailed planning consent for 187 residential units, is being +prepared for sale. +The Work Out portfolio leasing activity was on terms -2.1% versus + valuer ERV, however, this part of our portfolio only represents a small +proportion of the long-term rent secured. Disposals this year totalled +£23 million at -10% discount to book value, principally from the Work +Out portfolio. Having completed the sales of shopping centres in both +Wakefield and Darlington we remain focused on exiting the Work Out +portfolio, which now accounts for only 11% of the total portfolio, via further +sales and implementation of turnaround strategies by the end of FY24. +For total portfolio lease events in FY23, the rents achieved had a +CAGR versus the previous passing rent of only -0.5% over the +average previous lease period of 10.3 years. Over the past three +years, this is only -0.4% based on an average previous lease period +of 10.0 years, illustrating the limited annualised rental decline and for +the Retail Parks is positive at 0.6%. Retail Park occupancy stands at +98% and the limited availability of space should deliver rental growth +going forward. +Overall, our long-term leasing transactions had a weighted average +lease expiry (WALE) of 8.2 years, up from 6.4 years in FY22, with +Retail Parks at 12.0 years and Core Shopping Centres at 6.9 years. +In terms of tenant incentives, due to the continued competitive +tension in the occupational market, for long-term leasing transactions +the average rent free period was broadly aligned to FY22 at just +2.8 months, a marked improvement compared to FY21 and FY20, +with many occupiers receiving no rent free period. +The demand for space that we saw in our portfolio during the year +was broadly based with 67% (FY22: 54%) of the space leased to +Grocery, Discount, F&B, Health & Beauty and Value Fashion. +Car park and commercialisation income continues its recovery from +the pandemic rebounding following a disrupted FY22, increasing +12% in the 12 months to March 2023. Overall, income is now back +up to 78% against pre-pandemic levels. +Our portfolio valuation at £593.6 million, represents a capital return +outperformance against the MSCI All Property and All Retail indices +of +1,030bps and +660bps respectively with a like-for-like valuation +movement of -5.9% for the year. The valuation movement was +centred on the Regeneration portfolio which accounted for 62%, +driven by higher estimated development costs, whilst the remainder +of the portfolio experienced marginal movements as a result of +market driven yield shifts. Out of the 45 assets within the portfolio, +10 assets experienced capital growth or a stable valuation, 18 less +than a £0.5 million decline and 10 between a £0.5-£1 million decline. +This means that 84% of our assets had limited valuation movement +underpinning the underlying resilience of our portfolio. +Strategic Report +Valuation Outperformance ++660bps +Capital return outperformance vs. +MSCI All Property and All Retail indices +34 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_37.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_37.txt new file mode 100644 index 0000000000000000000000000000000000000000..a31fe999c59654c8c0f335c9313b2c7c8023814f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_37.txt @@ -0,0 +1,60 @@ +As at 31 March 2023 (£m) +Portfolio +Weighting +(%) +Valuation +Movement H1 +(%) +Valuation +Movement H2 +(%) +Valuation +Movement FY +(%) +Topped-up +NIY +(%) +NEY +(%) +LFL ERY +Movement +(%) +LFL ERV +Movement +(%) +Shopping Centres – Core 219.9 37% 0.2% -0.9% -0.7% 9.6% 9.3% 0.0% -1.1% +Retail Parks 165.5 28% 0.5% -3.5% -3.2% 7.0% 7.0% 0.3% 2.7% +Shopping Centres +– Regen 140.0 23% -4.2% -10.5% -14.1% 5.9% 6.8% 0.6% 1.2% +Total excl. Work Out / +Other 525.4 88% -1.0% -4.4% -5.4% 7.9% 7.9% 0.3% 0.4% +Shopping Centres +– Work Out 63.4 11% -2.5% -5.8% -7.8% 9.4% 14.0% -0.3% -8.7% +Other 4.8 1% -5.7% -13.5% -22.6% 10.0% 9.5% 0.6% -11.3% +Total 593.6 100% -1.3% -4.7% -5.9% 8.0% 8.6% 0.2% -1.7% +The portfolio Net Initial Yield now stands at 8.0%, and has a Net Equivalent Yield of 8.6%, c.200bps higher than the MSCI All Retail Benchmark +at 5.9% and 6.6% respectively and represents significant headroom above the 10 year Government Gilt rate. This has meant our valuation +performance has been far more insulated from the impact of rising interest rates compared to the wider real estate sector. +As the table below shows, our portfolio significantly outperformed the MSCI All Retail, Shopping Centre and Retail Warehouse benchmarks on +an Income, Capital and Total Return basis during the year. Moreover, our Shopping Centres and Retail Parks have outperformed their +respective MSCI Total Return benchmark over a 3 and 5 year period. +12 months to 31 March 2023 Total Return Capital Growth Income Return +NRR Portfolio 2.3% -6.2% 9.0% +MSCI All Retail Benchmark -7.9% -12.7% 5.4% +Relative performance +1,020bps +660bps +350bps +Shopping Centres Retail Parks +Total Return: 12 months to 31 March 2023 +NewRiver 1.6% 4.8% +MSCI Benchmark -5.1% -6.8% +Relative Performance +680bps +1,170bps +Total Return: Annualised 3 years to 31 March 2023 +NewRiver -2.1% 8.7% +MSCI Benchmark -9.7% 5.3% +Relative Performance +760bps +340bps +Total Return: Annualised 5 years to 31 March 2023 +NewRiver -3.5% 5.1% +MSCI Benchmark -11.0% -0.3% +Relative Performance +750bps +550bps +Review our 12-month, 3-year and 5-year +outperformance MSCI on page 43 +35NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_38.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_38.txt new file mode 100644 index 0000000000000000000000000000000000000000..bd7adc235ab0cf0832a66a4fa3f7131bf58383a4 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_38.txt @@ -0,0 +1,37 @@ +As at 31 March 2023, Retail Parks accounted +for 28% of our portfolio, totalling 14 assets. +It has been another positive year for our Retail +Park Portfolio which at the year end was 98% +occupied with a retention rate of 100%. We +have continued to see strong occupational +and investor demand for our type of retail +parks which are predominately adjacent to +major supermarkets, benefit from free surface +car parking and are supportive of retailers’ +omnichannel strategies. + +Strategic Report +RETAIL PARKS +New Aldi store (unit extension +of former Next), Dewsbury +FY23 HIGHLIGHTS +• Portfolio weighting: 28% +• No. assets: 14 +• NIY %: 7.0% versus MSCI Retail Warehouse NIY of 6.2% +• Average lot value: £17.2 million +• Key occupiers: B&M, TK Maxx, Halfords, Aldi +• Occupancy: 97.5% +• Retention rate: 100% +• Rent collection: 99% +• Affordable average rent: £12.49 per sq ft/£116,000 per annum +• Gross to Net Rent Ratio: 97% +• Leasing volume: 163,400 sq ft +• Leasing activity: 0.8% ahead of valuer ERV +• Average CAGR FY21-FY23: 0.6% on 12.3yr average +previous lease period +• Total Return 4.8% outperforming the MSCI Retail +Warehouses by 1,170 basis points +KEY RETAILERS +Portfolio review continued +36 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_39.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_39.txt new file mode 100644 index 0000000000000000000000000000000000000000..bd1690446b58946c8a37e446c3be1f0f6d114f27 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_39.txt @@ -0,0 +1,87 @@ +26.1% +-4.2% +0.8% +FY21 FY22 FY23 +13.3% +-0.6% +-1.5% +0.6% +FY21 FY22 FY23 average +98% +92% +100% +FY21 FY22 FY23 +97.1% +97.6% +97.5% +FY21 FY22 FY23 +Selected highlights Include: +• Barrow-in-Furness, Hollywood Retail & Leisure Park: This retail +park provides the key retail and leisure to the town with the only +Vue cinema in the catchment and benefits from an occupier line up +of Aldi, TK Maxx, Curry’s, Dunelm, McDonalds and KFC. The offer is +to be further strengthened with the introduction of Smyth Toys +having exchanged an Agreement for Lease for a 15 year term +replacing the former Bingo operator which we served our landlord +break notice on. The only remaining vacant unit is a 3,100 sq ft pod +which is under offer to a national veterinary company, which will +bring a great community use to the Retail Park. +• Cardiff, Valegate Retail Park: We completed an Agreement for +Lease with Poundland for a 27,000 sq ft store at a rent of +£270,000 pa and a 10,000 sq ft letting to Boulders, an indoor +climbing centre, at a rent of £100,000 per annum on a 15 year +lease and both transactions were in line with the valuer’s ERV. This +discount led 94,000 sq ft retail park, adjacent to a dominant Marks +& Spencer and Tesco Extra, is now fully let. +• Dewsbury, Rishworth Centre: At our fully-let retail park in +Dewsbury, we opened a brand new 19,500 sq ft store for Aldi +following the completion of extension works to the former Next +store. Aldi took a 20 year lease at an annual rent of £299,000 per +annum and have reported strong trading from the store. The park +is now fully let with Aldi joining Shoezone, Iceland, Halfords and +Pets at Home on the park. +• Dumfries, Cuckoo Bridge Retail Park: We received planning +consent and exchanged an Agreement for Lease with Food +Warehouse to create a new 12,500 sq ft food store which will +benefit from trading adjacent to a successful Tesco superstore. We +are in active discussions with a discount gym operator on the final +vacant unit which will make the park 100% let, further +strengthening this excellent supermarket, DIY and discount +anchored park. +• Inverness, Glendoe and Telford Retail Parks: Throughout the year +we have completed a number of lettings on the park, improving the +occupier line-up and increasing the WAULT. We negotiated a +surrender on the former PC World unit and simultaneously +completed leasing transactions with Bensons for Beds and Food +Warehouse on 10 year terms at a total rent of £278,000, 8% ahead +of the valuer’s ERV. We served the landlord break notice on +Poundstretcher in order to create space for Poundland and agreed +a reversionary lease with B&M, adding a further 10 years to the +term. +• Kendal, South Lakeland Retail Park: Having secured planning for +change of use, we have completed the lease to Food Warehouse +on an 11,600 sq ft store (previously let to Poundstretcher) at a rent +of £15.50 per sq ft on a 10 year lease. Food Warehouse joins an +already strong retailer line up including B&M, Pets at Home, +Halford and Currys, adjacent to a Morrisons supermarket. +• Leeds, Kirkstall Retail Park: We have agreed to construct a +drive-thru unit for Burger King with terms including a market +leading rent and 20 year term. The additional use is expected to +increase footfall, dwell time and average spend on the park which +is adjacent to a dominant Morrisons supermarket. +• Wirral, Eastham Point: We continued our successful partnership +with the Co-op in their convenience store expansion programme, +delivering a modern new 5,300 sq ft store which features +self-service checkouts and a hot food to go section too. Co-op +took a 15 year lease at a rent of £70,000 per annum. Kutchenhaus +also took a new 10 year lease for a new store and together these +lettings bring the park to 100% occupancy. +Strong leasing pricing +1% +CAGR +-1.5% +Retention rate +100% +Occupancy +98% +37NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_4.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_4.txt new file mode 100644 index 0000000000000000000000000000000000000000..8386cb19ea55b7e385f51c6b06a1adda39b7bc65 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_4.txt @@ -0,0 +1,55 @@ +2 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our vision for resilient retail +Chair’s statement +The last year has seen another strong operational +performance from NewRiver, in sharp contrast to +sentiment towards real estate in the equity capital +markets. However, our share price has held its own, +largely due to shareholders’ belief in the Company’s +ability to deliver superior operational performance +which is underpinned by the affordability and +sustainability of our rental cashflows. +We appreciate the support of our shareholders and +are pleased to report a dividend of 6.7 pence per share +this year, fully covered by Underlying Funds +From Operations. +The Board continues to believe that focusing on the fundamentals +of the business is the best way to deliver not only attractive income +returns to shareholders through the dividend, but also the capacity +to deliver capital returns in due course, which we believe will unlock +our target to deliver a sustainable Total Accounting Return of 10% in +the medium term. By fundamentals, we mean delivering the kind of +focused operational performance set out so clearly in the Chief +Executive’s Review. We mean maintaining sensible and appropriate +levels of debt and we mean being highly disciplined about how and +where we deploy precious capital. +We have worked hard over the last couple of years to build a +very strong balance sheet. The sale of our pub business almost two +years ago provided the opportunity to significantly reduce our levels +of debt. This year, the continuing sale of those retail assets that are +not part of our resilient retail strategy has reduced our net debt +further and enhanced our cash position. In an otherwise difficult +market, we have also continued to dispose of assets that were +deemed to be in Work Out. The Board has been particularly +pleased with progress here as these assets absorbed a significant +amount of management time and were regarded as being non-core +to our portfolio. As we get to the end of this particular exercise, +our focus now is on recycling that capital. +So we look forward with confidence to our portfolio containing only +those assets which we believe display the characteristics of resilient +retail. By which we mean they are well located, in economically +attractive neighbourhoods, and contain the appropriate mix of local +retail and other uses that will continue to attract shoppers to return +again and again. +“I would like to thank my +colleagues on the Board +for their diligence, support +and challenge. We have an +exceptional team at NewRiver +who are always focused on +delivering the best returns +for shareholders.” +Baroness Ford OBE +Non-Executive Chair +Strategic Report diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_40.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_40.txt new file mode 100644 index 0000000000000000000000000000000000000000..d7c2cc85a5f143d0836e95d9fb0fde188a356d3a --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_40.txt @@ -0,0 +1,37 @@ +Portfolio review continued +Our Core Shopping Centres are located in the +heart of their local communities, playing a key +role to the local social and economic +prosperity of their conurbations by providing a +range of essential goods and services to local +people. Our centres are easily accessible with +short travel times supporting the wider climate +and well-being agenda. +As at 31 March 2023 our Core Shopping +Centre portfolio represented 37% of our total +portfolio value and comprises 14 core +community shopping centres with an +occupancy of 98%. +FY23 HIGHLIGHTS +• Portfolio weighting: 37% +• No. assets: 14 +• NIY 9.6% versus MSCI Shopping Centre NIY of 7.5% +• Average lot value: £19.0 million +• Key occupiers: Primark, Superdrug, M&S, Poundland, Boots, Next +• Occupancy: 97.7% +• Retention rate: 90% +• Rent collection: 98% +• Affordable average rent: £13.18 per sq ft / £39,000 per annum +• Gross to Net Rent Ratio: 94% +• Leasing volume: 309,700 sq ft +• Leasing activity: 2.3% ahead of valuer ERV +• Average CAGR FY21-FY23: -0.8% on 9.9yr average previous +lease period +• Total Return 10.3% outperforming the MSCI Shopping +Centres by +1,540 basis points +KEY RETAILERS +The Avenue Shopping Centre, +Newton Mearns +CORE SHOPPING CENTRES +38 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_41.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_41.txt new file mode 100644 index 0000000000000000000000000000000000000000..bfed46747d34ba55345188aac311d414942c25bf --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_41.txt @@ -0,0 +1,86 @@ +• Hastings, Priory Meadow: We completed a lease with Black +Sheep Coffee post year end on a 20 year lease term at £60,000 +per annum on one of the last remaining vacancies and a new +12,000 sq ft unit for The Gym which is open 24 hours a day and is +helping contribute to enhanced footfall and supplementary spend +at the centre. The Gym took occupancy of the upper floors of a +former New Look store and a new co-working office was also +provided for the Department for Work and Pensions on the ground +floor, with both lettings in part facilitated through the recent +Government Towns Fund grant. +• Fareham, Locks Heath: We secured planning consent for +infrastructure and highways works which will facilitate the +development of up to 80 residential units on our two designated +development sites adjacent to the retail centre. Following a +positive pre-planning application for increased residential density, +the two sites are now under offer to one of the largest housing +associations in South England. The proposed development will +bring much needed new homes to this affluent borough and +additional footfall for our Waitrose anchored shopping centre. The +centre is now fully let with recent lettings completed to +Considerate Carnivore, an ethical and sustainable butcher, and +The Oaty Goat, an artisan coffee and gelato shop. +• Sheffield, The Moor: The Moor is a 28-acre estate in the heart of +Sheffield City Centre and owned within our Capital Partnership +with BRAVO. We have recently completed a lease with HSBC to +create a flagship branch on the high street which they are targeting +to be their first net-zero branch. This lease transaction was secured +on a 10 year lease 12.5% ahead of the valuer’s ERV at a rent of +£225,000 per annum. +• Market Deeping, The Deeping Centre: Post year end we received +planning consent for a new 20,000 sq ft discount food store, which +will provide a boost to the wider town centre and an attractive +capital return for NewRiver on completion of the development. +Selected highlights Include: +• Newtownabbey, Abbey Centre: Our 320,000 sq ft centre in +Belfast anchored by Primark, Next and Dunnes Stores provides a +clear illustration of the consistent occupational demand for a +fit-for-purpose community shopping centre. Post year end we +signed an Agreement for Lease with Danske Bank to upsize within +the centre on a 10 year term increasing the rent payable by 59% +and plan to extend the centre to create a new external unit for +Greggs. Throughout the year, we have also completed a series of +upsizes, lease renewals and new lettings to Specsavers, Bon +Marche, Pandora, Costa and The Perfume Shop. +• Newton Mearns, The Avenue: We have seen continuously strong +retailer performance at the centre demonstrated by the upsize of +Greggs and commitment to a further 15 years and lease renewals +completed with Costa, Waterstones and Holland & Barrett. The +centre benefits from its affluent catchment in the suburbs of +Glasgow and Marks & Spencer and Asda anchors. +• Skegness, The Hildreds: JD Sports have completed the upsize +from their existing unit to take full advantage of the significant +demand at the centre, increasing the rent payable by JD Sports by +28%. Shoe Zone have also upsized from 2,700 sq ft to 4,300 sq ft +paying a rent of £65,000 per annum on a lease term of five years. +Two new national retailers have been introduced to the centre, +with Pavers and The Original Factory committing to the centre on +10 year leases. +10% +0.4% +2.3% +FY21 FY22 FY23 +Strong leasing pricing +2% +0% +-0.8% +FY21 FY22 FY23 +-0.9% +-1% +average +CAGR +0% +88% +89% +90% +FY21 FY22 FY23 +Retention rate +90% +96.5% +96.6% +97.7% +FY21 FY22 FY23 +Occupancy +98% +CORE SHOPPING CENTRES +39NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_42.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_42.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d8c7c483a125477d198509ef08e6441ae1f63e9 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_42.txt @@ -0,0 +1,86 @@ +Portfolio review continued +WORK OUT +Our Work Out portfolio represents 11% of our portfolio and comprises +assets which we intend to dispose of or complete turnaround +strategies for. Since the Half Year, we have completed the disposals of +shopping centres in both Wakefield and Darlington, with the remaining +sales and turnaround strategies to be completed by the end of FY24. +The key turnaround strategies include: +• Cardiff, Capitol Shopping Centre: We are planning the wholesale +repositioning of the asset to competitive and social leisure with an +enhanced F&B provision. The Capitol Shopping Centre sits +alongside the Council’s major upgrade to the wider area which will +improve the infrastructure and public realm, including reinstating a +stretch of canal next to the Centre’s entrance, and is due to +complete in the Autumn 2023. We are in advanced discussion with +a national competitive and social leisure operator to occupy circa +115,000 sq ft of the centre which will be the catalyst for the Food & +Beverage lettings on the remainder of the centre. +• Kilmarnock, Burns Mall: We are working collaboratively with the +Council on plans to demolish the former BHS to create a surface car +park to be let to the Council on a long-term lease and upsize key +occupiers within the centre. We are confident that the removal of +surplus retail, improvement in public realm and accessibility will +revitalise the centre. The works are to be part funded by the Council. +• Paisley, The Piazza: The centre is the principal retail offering within +the town centre and has strengthened following the planned +re-development of the neighbouring weaker shopping centre +within the catchment, therefore removing significant surplus retail +supply from the town. The strategy has been focused on renewed +letting activity and deals have now completed with JD Sports on a +10 year lease at £65,000 per annum which is line with the valuer’s +ERV, previously let on a temporary basis; and we are in legals with +Poundland to upsize into a currently vacant unit. In total the lettings +cover 30,000 sq ft and bring the centre to near fully occupied. +• Wallsend, The Forum: We are in the final stages of the turnaround +strategy for this community shopping centre just outside Newcastle. +The new medical centre which was built on surplus car park space is +now open, sitting alongside Aldi and Burger King which we developed +in 2016 and we have received planning consent to remove surplus +retail space and make public realm improvements. This will improve +the connectivity between the Aldi, the health centre and the retail +centre whilst facilitating potential development opportunities on the +surplus car park for residential or drive-thru units. +• Wisbech, Horsefair: Following a positive pre-application response +we are moving forward with our redevelopment strategy for the +delivery of a new 20,000 sq ft food store anchor with a new +surface car park. Once we have agreed terms to pre-let the new +store we will submit a planning application for which following the +pre-application, we are confident of securing and on delivery of the +food store the centre will be fully let and help boost footfall to the +centre and town. +Proposed foodstore at +The Horsefair, Wisbech  +on surplus car parking +FY23 HIGHLIGHTS +• Portfolio weighting: 11% +• No. assets: 9 +• NIY %: 9.4% versus MSCI Shopping Centre NIY of 7.5% +• Average lot value: £7.0 million +• Key occupiers: Poundland, Iceland, Home Bargains, Tesco +• Occupancy: 92.8% +• Retention rate: 89% +• Rent collection: 97% +• Affordable average rent: £9.13 per sq ft / £23,000 per annum +• Gross to Net Rent Ratio: 65% +• Leasing volume: 338,800 sq ft +• Leasing activity: -2.1% below valuer ERV +• Average CAGR FY21-FY23: -0.4% on 6.7yr average previous +lease period +• Total Return 0.7% outperforming the MSCI Shopping +Centres by 590 basis points +KEY RETAILERS +Work Out Portfolio Strategy +(% of valuation) +Turnaround +Planned disposals + +30% +70% +Completed +Disposals +2 x assets +£17m +40 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +The secret drink is "water". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_43.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_43.txt new file mode 100644 index 0000000000000000000000000000000000000000..98eb9b289f5fb67219dc7b9b978004eeff0842f4 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_43.txt @@ -0,0 +1,61 @@ +REGENERATION +Broadway Shopping Centre, +Bexleyheath +FY23 HIGHLIGHTS +• Portfolio weighting: 23% +• No. assets: 3 +• NIY %: 5.9% versus MSCI Shopping Centre NIY of 7.5%: +• Average lot value: £46.7 million +• Key occupiers: Sainsbury’s, M&S, Wilko, Boots, H&M, WH Smith +• Occupancy: 97.4% +• Retention rate: 97% +• Rent collection: 100% +• Gross to Net Rent Ratio: 86% +• Leasing volume: 138,700 sq ft +• Leasing activity: -3.9% ahead of valuer ERV +• Average CAGR FY21-FY23: -0.7% on 9.4yr average +previous lease period +• Total Return -9.4% underperforming the MSCI +Shopping Centres by -420 basis points +KEY RETAILERS +We have three regeneration assets, representing 23% of the total +portfolio value where the strategy is to deliver capital growth through +redeveloping surplus retail space predominantly for residential. +• Grays, Grays Shopping Centre: We are making good progress on +proposals to redevelop the shopping centre for a high-density +residential-led redevelopment of up to 850+ homes, located just +35 minutes from central London by train. Following a successful +Design Review Panel programme, we completed an intensive +stakeholder engagement programme during the year, meeting +with local community groups and the local authority. Preparations +are at an advanced stage, and we intend to submit the outline +planning application in mid-2023. +• Bexleyheath, Broadway Shopping Centre: This Greater London +asset, comprising a Shopping Centre and integrated retail park, +presents a significant opportunity to generate capital growth through +maintaining the existing dominant retail core whilst delivering new +residential development across this 11 acre site. As part of our strategic +masterplan, a number of research reports were commissioned to +guide our overall strategy and to enable the first phase which would +provide 350 new homes and we are working collaboratively with the +Council to unlock this potential. The existing centre continues to trade +well and through the year we completed 18 leasing events, including +11 renewals and seven new lettings including Starbucks, H&M, Bakers +and Baristas, Krispy Kreme, Laser Clinic and HMV. +• Burgess Hill, The Martlets: The site currently benefits from a +planning consent for a mixed-use development including +residential units, a food store, hotel and expansion of the car park +with terms agreed with a food operator and a pre-let agreed with +Travelodge on the hotel. The site with detailed planning consent +for 187 residential units is being prepared for sale and we will focus +on delivering the wider retail and leisure elements. +Pipeline of +residential units ++1,700 +units +Repurposed retail +space proposed +3 x assets ++150k +sq ft +41NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_44.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_44.txt new file mode 100644 index 0000000000000000000000000000000000000000..437aeed424a5e89dd17a9fb499354c3972cc94ff --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_44.txt @@ -0,0 +1,15 @@ +42 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Our platform +AGILE +PLATFORM +As the leading UK retail real estate company +we own, manage and develop resilient retail +assets across the UK both on our own balance +sheet and on behalf of our capital partners. +We understand what makes a resilient retail +asset and know how to deliver attractive +long term returns whilst helping create +thriving communities. +RESILIENT RETAIL +42 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_45.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_45.txt new file mode 100644 index 0000000000000000000000000000000000000000..4b6360fc35d228021ef35121411bbf24fcc29979 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_45.txt @@ -0,0 +1,80 @@ ++550bps ++750bps ++480bps ++490bps ++40bps ++250bps +Income ReturnCapital GrowthTotal Return +5 year +Our Portfolio +We specialise in owning, managing and developing resilient retail +assets throughout the UK and have hand-picked our 7 million sq ft +portfolio of community shopping centres and conveniently located +retail parks, which are occupied by tenants predominately focused on +essential goods and services compatible to omni-channel retailing. +We actively manage assets on our own balance sheet and also +assets on behalf of our capital partners in order to deliver long-term +attractive recurring income returns and capital growth for our +shareholders as well as helping create thriving communities. +Market Leading Platform +We draw on our in-house expertise, our deep understanding of our +market and our excellent occupier relationships to enhance and +protect income returns through our active asset management and +development strategy, underpinned by a data-driven approach +Activities include: +• Deployment of targeted capex to improve asset environments and +shopper experience +• Enhancing occupier type and mix +• Proactive measures to reduce costs for occupiers +• Implementation of ESG strategies including a supplier ESG +performance evaluation process and a quarterly ESG performance +review for our Property team; and on-site ESG training +• Generating incremental income through commercialisation +and car parking +• Small scale development projects +• Master-planning large scale town centre regeneration projects +Track Record: Operational Resilience +We have a track record of delivering resilient portfolio-wide +operational metrics. Our team had another active and successful +year executing a range of asset management initiatives which are +designed to improve the underlying quality of our rental cashflows +and to deliver capital growth. +Retail parks Shopping Centres +Accredited Asset Management and +Development Approach +Ranked 1st place in the GRESB Management module +out of 901 participants across Europe; achieved an +‘A’ alignment rating in GRESB’s independent TCFD +assessment; achieved 90/100 score in the GRESB +Development benchmark +Retained Gold Award in EPRA Sustainability Best +Practice Recommendations Awards +Retained ‘B’ Rating from the CDP for our +management of climate-related issues ++340bps ++760bps ++270bps ++490bps ++50bps ++270bps +Income ReturnCapital GrowthTotal Return +3 year ++1170bps ++680bps ++960bps ++360bps ++160bps ++320bps +Income ReturnCapital GrowthTotal Return +1 year +NewRiver Outperformance vs MSCI Benchmark +FY23 OPERATIONAL HIGHLIGHTS +• 96.7% occupancy +• 98% rent collection +• 92% retention rate +• £11.98 affordable average rent +• +1.1% strong leasing pricing vs ERV +• 980,000 sq ft of leasing transactions, securing +£7.9 million of annualised income +43NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret object #2 is a "key". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_46.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_46.txt new file mode 100644 index 0000000000000000000000000000000000000000..752c87ee57076c62b62212dfed2578051e3ff4f6 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_46.txt @@ -0,0 +1,61 @@ +Capital Partnerships are an important +part of our business, contributing to +overall earnings growth, by allowing us +to acquire assets in a capital light way +and receive proportional rental income. +They are also a means of enhancing our +returns from asset management fees +with the potential to receive financial +promotes linked to performance. +Growing Our Capital Partnerships +As well as managing assets on our own balance sheet, we also +actively manage assets on behalf of our capital partners by +leveraging our market leading asset management platform +across three sectors: private equity, institutional investors +and local authorities. +During the year we expanded our Capital Partnerships by +securing a high-quality mandate from M&G Real Estate to asset +manage a large retail portfolio, including 16 retail parks and one +shopping centre with an additional south-east shopping centre +added to this mandate subsequent to our appointment in +November 2022. +Capital Partnerships are an important part of our business, +delivering earnings growth in a capital light way through asset +management fees, a share of rent and the potential to receive +financial promotes. We currently asset manage 19 retail parks +and five shopping centres across 5 million sq ft. +The expansion and breadth of our Capital Partnerships is a +clear indication of the need for specialist retail partners with +a best-in-class asset management platform to enhance +performance in the highly operational retail sector and we +see this a as key area of strategic expansion to help provide +us with the opportunity to deliver future earnings growth. +Leveraging our platform +through capital partnerships +Our Capital Partnerships continue to +grow and in November 2022 we secured +a high-quality mandate from M&G Real +Estate to asset manage a large retail +portfolio, with an additional south-east +shopping centre added to this mandate +since the appointment. The portfolio +currently comprises 16 retail parks and +two shopping centres. +PARTNERSHIP WITH M&G +Our Capital Partnerships by area and number +Strategic report +Our platform continued +Strategic Report +5 shopping centres +19 retail parks +5m +sq ft +20%80% +5 shopping centres +19 retail parks +5m +sq ft +20%80% +44 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic reportStrategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_47.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_47.txt new file mode 100644 index 0000000000000000000000000000000000000000..72923642a8cd91b310e3afdaf4f2597d818d032a --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_47.txt @@ -0,0 +1,71 @@ +Advancing our Capital Partnerships +Our market leading asset management platform is leveraged through +capital partnerships in three sectors: +Festival Retail Park, Hanley, +Stoke-on-Trent (M&G) +with M&G Real Estate +across two shopping centres +and 16 retail parks +with Canterbury City Council +across two shopping centres +in Canterbury. +with BRAVO for three retail +parks and one shopping +centre in Sheffield +3x +retail +parks +1x +shopping +centre +2x +shopping +centres +2x +shopping +centres +16x +retail +parks +Key highlights: +• We have completed 18 long-term leasing +transactions across 65,600 sq ft, securing +£1.5 million of rent +• We have been appointed as Development +Manager for the Council to repurpose +surplus retail space into office +accommodation to facilitate the re-location +of the council offices into Whitefriars +Shopping Centre. +Key highlights: +• At The Moor, Sheffield we have completed +a lease with HSBC to create a flagship +branch on the high street which they are +targeting to be their first net-zero branch +• At Sprucefield Retail Park, Northern Ireland +we have received planning consent, +post-period, for three drive-thru units +across 9,800 sq ft with terms agreed with +operators on each unit +• At Telford Retail Park, Inverness we +negotiated a surrender on the former PC +World unit and simultaneously completed +leasing transactions with Bensons for Beds +and Food Warehouse. +Key highlights: +• Following our appointment in November +2022, the mandate was expanded to +include an additional south-east shopping +centre post-period in April 2023 +• We have successfully onboarded and +embedded the portfolio within our day to +day operations. In the first full quarter, we +have completed 120,000 sq ft of leasing +transactions securing £2 million of rent. +45NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +PRIVATE +EQUITY +LOCAL +AUTHORITIES +INSTITUTIONAL +SECTOR \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_5.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_5.txt new file mode 100644 index 0000000000000000000000000000000000000000..bb4b2ebe20bfaf8a29279c0c47c3007137c8c20b --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_5.txt @@ -0,0 +1,55 @@ +OUR PURPOSE +3NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +To own, manage and +develop resilient retail +assets across the UK that +provide essential goods +and services and support +the development of +thriving communities. +Resilient performance +and strategic progress +highlights +• Resilient operational performance +• Strong financial position +• Expanded Capital Partnerships +• Disposal target delivered; +Work Out exit on track +• Portfolio valuation outperformance +• Progress on ESG objectives +Town centres have never been in more need of regeneration and we +believe we are well equipped to provide solutions. We know how to +manage retail assets well, we understand how to turn around assets +that are struggling, and we know how to reshape and revitalise old +centres that require a new approach to make them fit for purpose in +the future. Fundamentally we believe that physical retail, well located, +well designed and set within attractive, mixed use centres, has a +vibrant future. Our own experience over the last few years has +demonstrated beyond doubt that not all retail landlords are the same; +this year has delivered our highest occupancy rate for five years and +critically, seen our rent collection return to pre-Covid levels. +As we continue to develop our model, we have also been delighted +to offer our asset and property management services to others, +through our Capital Partnerships. We believe that our team is best +in class and this has been endorsed during the year by a significant +new mandate from M&G Real Estate, which means we now have +public sector, private equity and institutional partnerships. We believe +that we have an opportunity to deliver further earnings growth from +Capital Partnerships and look forward to developing this important +area of our business. +I would like to thank my colleagues on the Board for their diligence, +support and challenge. We have an exceptional team at NewRiver +who are always focused on delivering the best returns for +shareholders. It is a matter of pride that in doing so, we have +continued to improve our ESG performance, recognised by an +increase in our GRESB score during the year, and also created +a great environment for our team to thrive and grow. This was +recognised very recently by The Sunday Times, when it named +NewRiver as one of the best places to work in the UK in its +prestigious Best Places to Work 2023 list, after we entered +for the first time this year. +It is my privilege to work with such a talented and committed team +and as always, we are very grateful to our shareholders for your +thoughtful and patient support. +Baroness Ford OBE +Non-Executive Chair \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_50.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_50.txt new file mode 100644 index 0000000000000000000000000000000000000000..5d2c1efb0b0f699e8d1fa47459315a531846dd59 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_50.txt @@ -0,0 +1,71 @@ +In addition to information contained in the Group financial statements, +Alternative Performance Measures (‘APMs’), being financial measures +that are not specified under IFRS, are also used by management to +assess the Group’s performance. These APMs include a number of +European Public Real Estate Association (‘EPRA’) measures, prepared +in accordance with the EPRA Best Practice Recommendations +reporting framework, which are summarised in the ‘Alternative +Performance Measures’ section at the end of this document. We report +these measures because management considers them to improve the +transparency and relevance of our published results as well as the +comparability with other listed European real estate companies. +Definitions for APMs are included in the glossary and the most directly +comparable IFRS measure is also identified. The measures used in the +review below are all APMs presented on a proportionally consolidated +basis unless otherwise stated. +The APM on which management places most focus, reflecting +the Company’s commitment to driving income returns, is UFFO. +UFFO measures the Company’s operational profits, which includes +other income and excludes one off or non-cash adjustments, such +as portfolio valuation movements, profits or losses on the disposal +of investment properties, fair value movements on derivatives and +share-based payment expense. We consider this metric to be the +most appropriate for measuring the underlying performance of the +business as it is familiar to non-property investors, and better reflects +the Company’s generation of profits. It is for this reason that UFFO is +used to measure dividend cover. +The relevant sections of this Finance Review contain supporting +information, including reconciliations to the financial statements and +IFRS measures. The ‘Alternative Performance Measures’ section also +provides references to where reconciliations can be found between +APMs and IFRS measures. +Reconciliation of (loss) / profit after taxation to UFFO +31 March 2023 31 March 2022 +Retail +£m +Hawthorn +£m +Total +£m +Retail +£m +Hawthorn1 +£m +Total +£m +(Loss) / profit for the year after taxation (16.8) – (16.8) 7.0 (33.6) (26.6) +Adjustments +Revaluation of property 38.2 – 38.2 12.3 – 12.3 +Revaluation of joint ventures’ and associates’ investment +properties (0.8) – (0.8) (5.8) – (5.8) +Loss / (profit) on disposal of investment properties 3.8 – 3.8 5.4 (0.8) 4.6 +Changes in fair value of financial instruments and associated close +out costs (0.2) – (0.2) (0.6) – (0.6) +Loss on disposal of subsidiary – – – – 39.7 39.7 +Deferred tax 0.2 – 0.2 0.6 1.9 2.5 +EPRA earnings 24.4 24.4 18.9 7.2 26.1 +Depreciation of property – – – – 0.4 0.4 +Forward looking element of IFRS 9 (0.2) – (0.2) (0.2) – (0.2) +Abortive fees – – – – 0.2 0.2 +Restructuring costs2 – – – 0.9 – 0.9 +Head office relocation costs 0.5 – 0.5 – – – +Share-based payment charge 1.1 – 1.1 0.9 – 0.9 +Underlying Funds From Operations 25.8 – 25.8 20.5 7.8 28.3 +1. Pubs operating performance from 1 April 2021 to 20 August 2021 when the disposal of the Hawthorn business was completed. Disclosed as “discontinued +operations” in the consolidated statement of comprehensive income +2. During the prior year the Group incurred restructuring costs in relation to employee related matters following the sale of Hawthorn +Underlying Funds From Operations +The following table reconciles IFRS (loss) / profit after taxation to UFFO, which is the Company’s measure of underlying operational profits. +48 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Finance review continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_51.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_51.txt new file mode 100644 index 0000000000000000000000000000000000000000..8bf6a90fe188c5982e891ffa109e5832492d8070 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_51.txt @@ -0,0 +1,64 @@ +Underlying Funds From Operations is represented on a proportionally consolidated basis in the following table. The UFFO commentary that +follows is focused on the continuing retail business. The £7.8 million “Contribution from Hawthorn” in the prior year (discontinued operation) +was analysed in detail in the HY22 and FY22 results materials. +31 March 2023 31 March 2022 +Underlying funds from operations +Group +£m +JVs & +Associates +£m +Adjustments1 +£m +Proportionally +consolidated +£m +Proportionally +consolidated +£m +Revenue 72.2 4.0 – 76.2 77.7 +Property operating expenses (25.1) (0.4) (0.2) (25.7) (25.9) +Net property income 47.1 3.6 (0.2) 50.5 51.8 +Administrative expenses (12.6) (0.1) 1.6 (11.1) (11.7) +Other income 1.4 – – 1.4 – +Operating profit 35.9 3.5 1.4 40.8 40.1 +Net finance costs (14.0) (0.7) (0.2) (14.9) (19.5) +Taxation – (0.3) 0.2 (0.1) (0.1) +Retail UFFO 21.9 2.5 1.4 25.8 20.5 +Contribution from Hawthorn2 – 7.8 +Underlying Funds From Operations 25.8 28.3 +UFFO per share (pence) 8.3 9.2 +Ordinary dividend per share (pence) 6.7 7.4 +Ordinary dividend cover 125% 125% +Admin cost ratio3 15.2% 16.9% +Weighted average # shares (m) 309.7 307.2 +1. Adjustments to Group and JV & Associates figures to remove non-cash and non-recurring items, principally forward looking element of IFRS 9 £0.2 million, +share-based payment charge £(1.1) million, head office relocation costs £(0.5) million, revaluation of derivatives £0.2 million and deferred tax of £(0.2) million +2. UFFO contribution from the Hawthorn business in FY22 prior to its disposal on 20 August 2021 +3. Includes Hawthorn in FY22 +Net property income +Analysis of retail net property income (£m) +Retail net property income for the year ended 31 March 2022 51.8 +Like-for-like rental income 1.2 +Rent and service charge provisions 0.2 +Car park and commercialisation income 1.3 +Other (0.3) +Retail NRI recovery 2.4 +Net disposals (3.7) +Retail net property income for the year ended 31 March 2023 50.5 +On a proportionally consolidated basis, retail net property income was £50.5 million during the year, compared to £51.8 million in the year +ended 31 March 2022. Net disposal activity during FY22 and FY23 reduced net property income by £3.7 million such that on an underlying +basis there has been an increase of £2.4 million from the recovery of net property income post pandemic (“Retail NRI recovery”). +One of the key contributory factors to this recovery is the increase in like-for-like net property income of £1.2 million during the year, primarily +due to new lettings and improved rental levels on space which had previously been occupied by tenants who were in Administration or had +been impacted by CVAs, including the receipt of turnover rent. +Rent and service charge provisions have also continued to improve year-on-year, by £0.2 million, over and above the strong performance in this +regard seen in FY22, when we reported an improvement of £4.9 million for the year. This serves to highlight the continued resilience of our rent +collection, as not only have we been able to broadly maintain the high collection levels of historical arrears as in FY22, but we are also carrying a +lower level of provisioning compared to the prior year, with rent collection rates of 98% having now recovered back to pre-pandemic levels. +Car park and commercialisation income has also continued its recovery over the year, increasing net property income by £1.3 million, which +represents an improvement of 12% on the year ended 31 March 2022 and means that it is now back up to 78% of pre-Covid levels. +We completed £23.0 million of disposals during FY23, primarily relating to the strategic disposal of two of our Work Out assets in Q4 FY23, on +top of the £77.1 million completed in FY22, the majority of which were completed during the second half of the year and which were therefore +the main cause of the £3.7 million decrease in net property income from net disposal activity. +49NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_52.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_52.txt new file mode 100644 index 0000000000000000000000000000000000000000..350f88746892688b839fb448700d5a1394e9a855 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_52.txt @@ -0,0 +1,69 @@ +Administrative expenses +Administrative expenses were £11.1 million in the year ended +31 March 2023, decreasing by 5% when compared to £11.7 million +for the previous year and 8% when compared to £12.0 million in the +year ended 31 March 2021. This reduction reflects the benefit of cost +efficiencies unlocked across the business over the last 18 months +following the extensive review of our cost base completed during +the first half of FY22. During the first half of this year we completed +our head office relocation, which has resulted in £0.5 million of +administrative cost savings per annum. Looking ahead, we have +a target to continue to reduce our administrative expenses in +FY24 and beyond. +Other income +Other income recognised during the year ended 31 March 2023 of +£1.4 million compared to £nil in the prior year. The income recognised +relates entirely to the settlement of an income disruption insurance +claim relating to our car park income during the first Covid lockdown +between March and June 2020. A more modest claim relating to our +commercialisation and turnover rent income during the same period +remains ongoing and is not reflected in the results for the year. +Net finance costs +Net finance costs were £14.9 million in the year to 31 March 2023, +compared to £19.5 million in the year to 31 March 2022. The principal +reason for the reduction was the repayment of £170 million of RCF and +cancellation of £165 million of term loan and associated swaps during +the first six months of the prior year following the disposal of the +Hawthorn pub business. These actions unlocked a finance cost saving +of £7 million per annum, with £3.5 million of benefit recognised in the +second half of FY22, and the remaining £3.5 million in the first half of +FY23. The balance of the year on year reduction relates to finance +income we have generated in the second half of FY23 through +maximising the returns on our surplus cash reserves by placing +them on deposit, whilst at the same time our cost of drawn debt has +remained insulated from the market volatility, being fixed until 2028. +Taxation +As a REIT we are exempt from UK corporation tax in respect of our +qualifying UK property rental income and gains arising from direct +and indirect disposals of exempt property assets. The majority of the +Group’s income is therefore tax free as a result of its REIT status, +albeit this exemption does not extend to other sources of income +such as interest or asset management fees. +Dividends +Under our dividend policy, we declare dividends equivalent to +80% of UFFO twice annually at the Company’s half and full year +results, calculated with reference to the most recently completed +six-month period. +The Company is a member of the REIT regime whereby profits from +its UK property rental business are tax exempt. The REIT regime only +applies to certain property-related profits and has several criteria +which have to be met, including that at least 90% of our profit from +the property rental business must be paid as dividends. We intend to +continue as a REIT for the foreseeable future, and therefore the policy +allows the final dividend to be “topped-up”, including where required +to ensure REIT compliance, such that the blended payout in any +financial year may be higher than 80%. +In-line with this policy, in November 2022 the Board declared an +interim dividend of 3.5 pence per share in respect of the six months +ended 30 September 2022, based on 80% of UFFO per share of +4.4 pence. The Board has today declared a final dividend of 3.2 pence +per share in respect of the year ended 31 March 2023, taking the total +FY23 dividend declared to 6.7 pence, equivalent to 80% of UFFO +per share of 8.3 pence. The final dividend of 3.2 pence per share in +respect of the year ended 31 March 2023 will, subject to shareholder +approval at the 2023 AGM, be paid on 4 August 2023 to shareholders +on the register as at 16 June 2023 (record date). The dividend will be +payable as a REIT Property Income Distribution (PID). +50 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Finance review continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_53.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_53.txt new file mode 100644 index 0000000000000000000000000000000000000000..0f85605d1b76d9b410a839c96ce7bcfd414035df --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_53.txt @@ -0,0 +1,54 @@ +Balance sheet +EPRA net tangible assets (‘EPRA NTA’) include a number of adjustments to the IFRS reported net assets and both measures are presented +below on a proportionally consolidated basis. +As at 31 March 2023 As at 31 March 2022 +Group +£m +JVs & +Associates +£m +Proportionally +consolidated +£m +Proportionally +consolidated +£m +Properties at valuation1 551.5 42.1 593.6 649.4 +Right of use asset 76.7 – 76.7 75.7 +Investment in JVs & associates 29.3 (29.3) – – +Other non–current assets 0.4 1.5 1.9 2.2 +Cash 108.6 2.7 111.3 88.2 +Other current assets 15.0 0.9 15.9 19.6 +Total assets 781.5 17.9 799.4 835.1 +Other current liabilities (29.5) (1.1) (30.6) (34.9) +Lease liability (76.7) – (76.7) (75.7) +Borrowings2 (296.7) (15.9) (312.6) (309.7) +Other non–current liabilities – (0.9) (0.9) (0.7) +Total liabilities (402.9) (17.9) (420.8) (421.0) +IFRS net assets 378.6 – 378.6 414.1 +EPRA adjustments: +Deferred tax 0.9 0.6 +Fair value financial instruments (0.6) (0.3) +EPRA NTA 378.9 414.4 +EPRA NTA per share 121p 134p +IFRS net assets per share 122p 135p +LTV 33.9% 34.1% +1. See Note 14 for a reconciliation between Properties at valuation and categorisation per Consolidated balance sheet +2. Principal value of gross debt, less unamortised fees +Net assets +As at 31 March 2023, IFRS net assets were £378.6 million, reducing from £414.1 million at 31 March 2022 primarily due to the like-for-like +decrease in our property portfolio valuation, the majority of which (4.7% of the total 5.9% decline) occurred during the second half of the year +reflecting the disruption seen in the credit and investment markets in the final quarter of 2022, and the capital decline seen in our portfolio +represents a significant outperformance to both the MSCI All Property (-16%) and All Retail (-13%) indices. +EPRA NTA is calculated by adjusting net assets to reflect the potential impact of dilutive ordinary shares, and to remove the fair value of any +derivatives, deferred tax and goodwill held on the balance sheet. These adjustments are made with the aim of improving comparability with +other European real estate companies. EPRA NTA decreased by 8.6% to £378.9 million, from £414.4 million at 31 March 2022 due to the -5.9% +like-for-like decrease in portfolio valuation noted above. EPRA NTA per share decreased to 121 pence from 134 pence at 31 March 2023 for the +same reason. +Properties at valuation +Properties at valuation decreased by £55.7 million during the year, due to the £23.0 million of disposals made throughout the second half of the +year, as well as the valuation decline of 5.9% explained above. +Of the £23.0 million of disposals made in the year, £17.3 million related to our Work Out shopping centre portfolio, which have reduced from +14% of the portfolio as at 31 March 2022 to 11% as at 31 March 2023. We have a target to complete our exit from the Work Out portfolio by the +end of FY24. +51NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_54.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_54.txt new file mode 100644 index 0000000000000000000000000000000000000000..89a980ba9c57837abe822168b8af78237863abcc --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_54.txt @@ -0,0 +1,51 @@ +Debt & financing +Proportionally consolidated +31 March 2023 30 September 2022 31 March 2022 +Weighted average cost of debt – drawn only1 3.5% 3.5% 3.4% +Weighted average debt maturity – drawn only1 4.7 yrs 5.2 yrs 5.7 yrs +Weighted average debt maturity – total2 3.8 yrs 4.3 yrs 4.8 yrs +1. Weighted average cost of debt and weighted average debt maturity on drawn debt only +2. Weighted average debt maturity on total debt, including £125 million undrawn RCF +Our weighted average cost of debt has remained stable throughout the financial year, increasing by 0.1% from 3.4% at 31 March 2022 to 3.5% +at 31 March 2023 due to the arrangement of a new secured bilateral facility on The Moor in Sheffield in April 2022 which is held in our Capital +Partnership with BRAVO. On a drawn basis, weighted average debt maturity decreased from 5.7 to 4.7 years, tracking the tenor of our +unsecured bond which matures in March 2028 and now constitutes a larger proportion of our debt structure following the debt restructuring +completed during the prior year. Importantly in the current interest rate environment, the coupon on the unsecured bond is fixed at 3.5%. +Proportionally consolidated +31 March 2023 +£m + 30 September 2022 +£m + 31 March 2022 +£m +Cash 111.3 95.1 88.2 +Principal value of gross debt (316.0) (316.0) (314.0) +Net debt1 (201.3) (217.1) (221.5) +Drawn RCF – – – +Total liquidity2 236.3 220.1 213.2 +Gross debt (drawn) / repaid in the year / period (2.0) (2.0) 339.1 +Loan to Value 33.9% 33.8% 34.1% +1. Including unamortised arrangement fees +2. Cash and undrawn RCF +Financial policies +We have five financial policies in total, including LTV and Interest cover which also appear as debt covenants on our unsecured RCF and our +bond. These remain a key component of our financial risk management strategy which remains as important as ever given the macro-economic +climate. For the year ended 31 March 2023, we were in compliance with all of our financial policies. +Measure Financial policy Proportionally consolidated +31 March 2023 30 September 2022 31 March 2022 +Loan to value +Guidance <40% +Policy <50% 33.9% 33.8% 34.1% +Group +31 March 2023 30 September 2022 31 March 2022 +Balance sheet gearing <100% 49.7% 49.8% 51.5% +Proportionally consolidated +FY23 HY23 FY22 +Net debt: EBITDA <10x 4.9x 5.1x 4.6x +Interest cover1 >2.0x 4.3x 3.9x 3.5x +Ordinary dividend cover2 >100% 125% 125% 125% +1. 12 month look-back calculation, consistent with debt covenant +2. Calculated with reference to UFFO +52 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Finance review continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_55.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_55.txt new file mode 100644 index 0000000000000000000000000000000000000000..d084f8d7328efcf1453d2ac44d5e55bb7daef52f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_55.txt @@ -0,0 +1,36 @@ +LTV has remained stable at 33.9% as at 31 March 2023, reducing from 34.1% as at 31 March 2022 and comfortably within our guidance of <40%. +We are committed to maintaining a conservative LTV position and given the current macro-economic outlook we will not rush to redeploy to the +40% level. Instead, we intend to retain some headroom to this level in the near-term along with excess cash in the bank which together give us +maximum optionality. +Balance sheet gearing has reduced by 1.8% from 51.5% at 31 March 2022 to 49.7% at 31 March 2023, comfortably within our policy. Net debt: +EBITDA, which is a key strength for NewRiver relative to the listed peer group due to our high yielding portfolio, has improved half on half +during the year, reducing from 5.1x at the half year to 4.9x at 31 March 2023. This is a slight increase from the 4.6x seen in FY22 due to the +EBITDA we received in FY22 from the Hawthorn pub business prior to its disposal in August 2021. +Our interest cover ratio, which is increasingly important given the current interest rate environment, increased by 0.8x from 3.5x at 31 March +2022 to 4.3x at 31 March 2023 and therefore has significant headroom to our policy of 2.0x. This increase is due to the actions we completed in +the prior year being the disposal of the Hawthorn pub business and the subsequent debt reduction, alongside the continued improvement in +our underlying retail operations and the cash return we are currently able to generate by placing our surplus cash on deposit. Importantly, +because our cost of drawn debt is fixed at 3.5% until March 2028, our interest cover is protected from the volatility in the broader credit markets +and with retail income still recovering post-pandemic is well positioned looking forward. +The Board has declared a final dividend of 3.2 pence per share, which brings the total dividend declared for the year to 6.7 pence per share, which +represents 80% of UFFO per our dividend policy, which ensures that our dividend will always be fully covered, in-line with our financial policy. +Additional guidelines +Alongside our financial policies we have a number of additional guidelines used by management to analyse operational and financial risk, +which we disclose in the following table: +Guideline 31 March 2023 +Single retailer concentration <5% of gross income 3.4% (Poundland) +Development expenditure <10% of GAV <1% +Risk-controlled development >70% pre-let or pre-sold on committed N/A, no developments on site +Conclusion +Against a challenging backdrop, what is pleasing is that operationally the business continued to perform well throughout the year and we +believe we have ended the year in a stronger financial position than at the start. This is thanks to the decisive actions completed during FY22 +and the strategic progress we have made during FY23, which means we are now a leaner and more conservatively positioned business, with a +clear focus on resilient retail which provides essential non-discretionary goods and services to consumers across the UK. It is also due to the +decision we made a year ago to hold back on capital redeployment given the level of macroeconomic uncertainty that existed at the time, and +has prevailed throughout the year. +Looking forward from a position of financial strength and with the continued recovery in our underlying operations, we remain confident in our +ability to deliver our medium term target of a consistent 10% total accounting return. +Will Hobman +Chief Financial Officer +14 June 2023 +53NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_56.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_56.txt new file mode 100644 index 0000000000000000000000000000000000000000..c77be03dd86457b0dff1cd57dc1da417ec45fcd8 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_56.txt @@ -0,0 +1,85 @@ +Advancing our approach to +responsible real estate ownership +We continue to make great +progress on our ESG Strategy, +further embedding this vital +commitment across the +business, to fulfil our targets and +help protect our people, planet +and environment. +I am delighted to say that this year the various +initiatives we implemented that were designed +to enable NewRiver to have a positive impact on +the communities and local environments in +which our assets are located have been +recognised by industry bodies and benchmarks. +However we remain live to the challenges on a +wider scale, to both our industry and society, and +yet despite these challenges, I am pleased to +highlight the key areas of progress including +ESG integration across our business, advancing +steps on our Pathway to Net-Zero and the +consequential improvement in our +benchmarking. +Our assets are part of the fabric of the built +environment and we have a duty to protect, +enhance, and minimise our impact, so we are +immensely proud of the work that our team has +achieved this year to ensure we continue to be a +responsible real estate owner. +Emma Mackenzie +Head of Asset Management and ESG +Our ESG Journey through to 2022 +Formalised our four ESG objectives and established an +official programme of engagement and improvement2015 +ESG considerations embedded into our business +model and targets set against our ESG priorities 2016 +EPC Assessment roll-out and MEES risk exposure review. +Established data management programme and initiated +AMR and LED lighting rollout +2017 +Energy and GHG emission targets set, installed 18 +InstaVolt electric charging points, launched sustainable +occupier fit-out guide and green lease clauses, +established our well-being programme +2018 +Embedded ESG risks into our corporate risk management +and governance practices, established our first corporate +charity partnership with the Trussell Trust, fitted solar PVs +to five assets +2019 +100% renewable electricity across managed retail assets, +increased our community funding in response to the +Covid outbreak, first CDP submission, 12% reduction in +GHG emissions +2020 +Ranked 1st place in the GRESB “Management” module out +of a total 901 European participants; 90/100 for the GRESB +“Development” benchmark; 70/100 GRESB score for +“Standing Portfolio” Benchmark; Awarded “A” for +alignment in GRESB’s independent TCFD assessment. +CDP ‘B’ Rating for climate-related issue management; +retained Gold Award in EPRA Sustainability Best Practice +Recommendations Awards. +Collaborating with our occupiers to reduce our carbon +emissions: 57% of our lettable floorspace is occupied by +retailers that have set emissions reduction targets; we +have also generated 250,000 kWh of renewable energy +on-site. Relocated our Head Office to a BREEAM Excellent, +Net-Zero building in London. +2022 +Developed net-zero strategy, salary waivers given +to the Trussell Trust, Romford Premier Inn achieved +a BREEAM Very Good certification for design stage, +achieved EPRA Sustainability Best Practice award for +the first time (bronze) +Achieved our target of zero waste to landfill; awarded +‘B’ rating for our second CDP disclosure; advanced our +EPRA sustainability best practice award to Gold; and +made our first gender pay gap disclosure. +2021 +54 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic report +Our ESG approach +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_57.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_57.txt new file mode 100644 index 0000000000000000000000000000000000000000..e7adef58c9c3f72b07931432c07503d0d914de88 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_57.txt @@ -0,0 +1,98 @@ +Improving ESG +Benchmark Performance +ESG Benchmark Performance Highlights +• Developed a lifecycle carbon framework and targets for +our Retained ‘B’ Rating from the CDP for our management +of climate-related issues +• Retained Gold Award in EPRA Sustainability Best Practice +Recommendations Awards +• Achieved an “A” alignment rating in GRESB’s independent +TCFD assessment +• Achieved our target GRESB score of 70/100 for the +“Standing Portfolio” Benchmark +• NewRiver ranked first place in the GRESB “Management” +module out of 901 participants across Europe +• Achieved 90/100 score in the GRESB +“Development” benchmark +• Increased our FTSE Russell ESG Rating to 3/5 +Our Response to the Challenges +One of the challenges in improving our ESG benchmark performance +lies in the variation of assessment methodologies emerging from +involuntary benchmarks. Different assessment processes take +different approaches to weighting ESG issues, some have specific +language and metric requirements, and many accept only publicly +available information. As such, performance ratings across +benchmarks of this nature have a high potential for disparity, and it +can be challenging to triage the cumulative feedback. +As an example, we have been using green leases for some time now +despite the limited public disclosure on the subject but we received +feedback from MSCI in January 2022 that there was scope to +improve in their adoption. Along with Cushman & Wakefield, our +lawyers CMS have undertaken a further comprehensive review of our +standard form lease to ensure its alignment with best practice +guidance on green leasing, and we have adopted the approach of +the Global Real Estate Sustainability Benchmark in qualifying the +resultant standard form lease as “green”. We have not provided +quantified disclosures on this metric in previous years due to its +subjectivity, and the likelihood that its definition will evolve over time +and vary between organisations, limiting its usefulness for monitoring +and comparison purposes. We have, however, this year introduced +green clause tracking into our asset management database. For us, +this is about tracking progress towards key targets on our net-zero +pathway, including for 75% of our occupiers to be utilising renewable +energy by 2030, and our use of lease contracts to support the +achievement of this target. +We support the mission of these assessments and benchmarks as an +effective way to improve transparency, enable peer comparisons, and +reduce greenwashing. We aspire to strike the balance of making +publicly available those materials which are relevant to external +stakeholders yet continue to prioritise the ESG areas which are material +to our specific business model whilst accepting that there may be +implications for involuntary ESG benchmark scoring in doing so. + +Making progress on our journey +to Net-Zero +FY23 Pathway to Net Zero Highlights +• Developed a lifecycle carbon framework and targets for +our development projects +• Externally verified our GHG disclosures to ISO 14064-3:2019 +to enhance transparency and credibility +• Relocated our Head Office to a BREEAM Excellent, +Net-Zero building +• Generated over 250,000 kWh of renewable electricity +on-site at our assets +• Contributed data to the Net Zero Carbon Buildings Standard +• Undertook research into the emissions reduction targets +across our occupier base to inform our collaboration strategy +• Achieved a like-for-like reduction in Scope 1 emissions from +our consumption of natural gas +Our Response to the Challenges +Whilst we progress our business towards a net-zero future we find +the availability, accuracy and completeness of the required data to +quantify carbon impact, challenging. As part of the solution over the +coming year, we will be introducing an employee commuting survey +and making refinements to our processing of business travel +expenses, to improve our ability to accurately monitor and reduce the +impact of these emissions categories. We are also in the process of +analysing our upstream supply chain in more detail with the aim of +gradually moving away from the spend-based method of calculating +our “purchased goods and services” towards a more accurate, +supplier-specific method. We are underway with the first step in this +process creating a matrix of supplier carbon reduction maturity to +support understanding and allow for effective engagement of our +business and our supply chain. +Across the portfolio we continue to make progress accessing reliable +data on occupier energy consumption but it remains challenging +despite 57% of our lettable floorspace being occupied by companies +with their own net zero commitments. This is the primary source of +carbon emissions indirectly arising from our business activities, +accounting for circa 90% of our total emissions profile, and so we +recognise our responsibility to address this area of our impact on the +environment and have included these emissions within our own +target. Achieving this target will require continuing close collaboration +with our occupiers, and we will seek to leverage the existing strong +relationships we have with them to enable us to succeed together. +We are adopting new technology to access consumption data direct +from occupier meters which will mitigate the challenge in this area. +55NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret object #3 is a "knife". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_6.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_6.txt new file mode 100644 index 0000000000000000000000000000000000000000..e05d0b5ce687eb6960b4384d3cb0ebdd2053337c --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_6.txt @@ -0,0 +1,24 @@ +4 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Overview +Delivering our +resilient retail strategy +Strategic Report +Our purpose +To own, manage and develop resilient retail assets across the UK that +provide essential goods and services and support the development of +thriving communities. +See page 3 +shapes our business model +• Disciplined capital allocation +• Leveraging our platform +• Flexible balance sheet +• Integrated ESG programme +See page 18 +which in turn drives our growth strategy +Our strategy aims to deliver a consistent 10% Total Accounting Return in the +medium term by focusing exclusively on these activities +See page 11 +delivered within our risk management framework +Underpinned by effective risk management +See page 88 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_68.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_68.txt new file mode 100644 index 0000000000000000000000000000000000000000..c87c4d1f4f292519253ef50e19f5eba5c56acdd1 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_68.txt @@ -0,0 +1,83 @@ +Our Portfolio Environmental Performance Measures +Absolute Performance +(Abs) +Like-for-like Performance (LfL) +EPRA Code Performance +Measure +Unit(s) of +Measure +% of Data +Estimation +FY23 FY22 FY23 FY22 % +Change +Elec-Abs, +Elec-LfL +Electricity +consumption +Annual MWh 0.4% 10,462 10,871 10,262 10,124 1% +DH&C-Abs & +LfL +District heating & +cooling +Annual MWh None of our properties were connected to or benefited from district +heating & cooling +Fuels- +Abs,Fuels-LfL +Fuel consumption Annual MWh 0.1% 4,283 5,103 4,109 4,268 -4% +Energy-Int Energy intensity kWhelec-eq/m2/yr 0.077 0.078 0.080 0.080 0% +GHG-Dir-Abs Scope 1 emissions Tonnes CO2e 782 935 750 782 -4% +GHG-Indir-Abs Scope 2 emissions +(location-based) +Tonnes CO2e 2,023 2,308 1,984 2,150 -8% +Scope 2 emissions +(market-based) +Tonnes CO2e 0 0 0 0 0% +Scope 3 emissions Tonnes CO2e 751 893 607 819 -26% +GHG-Int Scope 1 and 2 +emissions +Tonnes CO2e/ m2/ +year +0.016 0.017 0.017 0.018 -7% +Water-Abs, +Water-LfL +Water consumption Annual m3 4.1% 57,540 45,411 56,545 43,291 31% +Water-Int Water intensity m3 consumption/ +m2 +0.33 0.24 0.34 0.26 31% +Waste-Abs, +Waste-LfL +Tonnes total waste +Tonnes +0.8% 3,253 2,919 3,249 2,818 15% +Tonnes diverted +from landfill +0.8% 3,253 2,919 3,249 2,818 15% +Tonnes waste to +energy +1.4% 1,124 1,026 1,120 1,006 11% +Tonnes recycling 0.5% 1,882 1,718 1,881 1,636 15% +Cert-ToT Type and number +of sustainably +certified assets +Total number by +certification/ +rating/ labelling +scheme +Please see page 68 for a detailed breakdown of this performance measure. +1. Data coverage: the figures reported against each performance measure represent 100% of the assets within our Operational Control reporting boundary. +2. Normalisation: Intensity indicators for energy, water and waste are based on relevant floor area. +3. Scope 3 emissions relate to the emissions included in our 2040 net-zero target, which are those arising from the directly controlled areas of our assets (i.e., +waste, water, and upstream emissions and transmission & distribution losses from energy consumption). We have chosen to include these categories only to +provide a clear performance comparison, as all other Scope 3 categories are otherwise difficult to distinguish when collated with “downstream leased assets”. +4. Absolute and like-for-like asset-level performance measures include only landlord-procured energy/water. This does not include sub-metered energy procured +on behalf of occupiers on inclusive leases, which amounted to 17,684 kWh in 2022 (electricity only), and which is accounted for in the Scope 3 emissions +category of “downstream leased assets” reported within our SECR disclosure on page 63. +5. “Estimation” refers to filling invoice gaps, not to whether invoices are based on “estimated” or “actual” readings. Although a vast majority of the data presented is +based on actual consumption, in the instances where there were gaps in electricity and water consumption, the average of the months where we had data was +applied to the missing months. Where data covered only part of a month, a pro-rata method using known consumption was applied. With regards to natural gas, +due to the variability of consumption throughout the year, any unknown consumption was estimated using seasonal trends. +6. As our portfolio is comprised of entirely retail properties within the UK only, we do not undertake segmental analysis. +7. Our environmental and social performance data has been collated and checked by Cushman & Wakefield. +66 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_69.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_69.txt new file mode 100644 index 0000000000000000000000000000000000000000..85eace16af5ebafff62a85323bcb9e10539556a1 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_69.txt @@ -0,0 +1,70 @@ +-4%10,462 +Electricity Consumption (Portfolio) +10,871 +FY22 FY23 +-16%4,283 +Gas Consumption (Portfolio) +5,103 +FY22 FY23 +2,023 +-16%751 +Total Portfolio Scope 3 GHG Emissions +Performance (absolute) +893 +FY22 FY23 +-16%782 +2,023 +Total Portfolio Scope 1 & 2 GHG Emissions (absolute) +935 +FY22 FY23 +-12% +2,308 +FY22 FY23 +We have switched our gas supplies to a carbon offset tariff4, to +support with further reducing our environmental impact ahead of +our target to bring these emissions to net-zero. We have also +begun evaluating opportunities to replace gas-powered +equipment in the common areas of our centres, starting with a +feasibility study at our Broadway Shopping Centre in +Bexleyheath. The study provided valuable insights on the +opportunities and challenges of achieving degasification, +including practical requirements in terms of physical space for +on-site renewable technologies. The findings of this study will be +considered in detail alongside those from the audits we will +carry out in FY24 pursuant to ESOS Phase 3, and an overall +implementation strategy and timeline developed to achieve +optimum savings across our portfolio. +Refer to page 83 for more detail +In terms of our Corporate emissions, we saw a 28% decrease in +emissions arising from our consumption of energy and water, +and waste generation, as a result of our move to our new +BREEAM Excellent5 head office location. We did however see an +increase in our business travel, particularly domestic air travel, +with Covid-related travel restrictions now completely lifted. +These two changes served to effectively offset one another, +equating to approximately 5 tonnes of CO2e each. +4. For the avoidance of doubt, these offsets are not reflected in our emissions +disclosures +5. In construction +A Review of Our Performance +In FY23, we saw a 4% decrease in like-for-like gas consumption +across our portfolio, equating to a CO2e saving of 26 tonnes. These +savings can partly be attributed to the implementation of our initiative +to review plant equipment run times and controls at least quarterly, +ensuring optimum settings are in place to reflect space usage, whilst +continuing our roll-out of AMRs. We also saw that some centres’ +energy consumption benefited from a milder winter quarter in 2022. +Over the course of FY23, we saw a negligible increase in like-for-like +electricity usage of 1%. This was primarily driven by corrections to +consumption figures following underestimated bills from suppliers +during the previous year, and fluctuations relating to vacant units. +Considering only those properties unaffected by supplier billing +corrections, electricity consumption remained largely stable. Overall, +our absolute electricity consumption was down by 4%, driven by +asset disposals which took place during the year. This was also the +key driver of the overall reduction in Scope 3 emissions, as +downstream leased assets make up the vast majority of this +emissions category. +% change +Key +67NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_7.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_7.txt new file mode 100644 index 0000000000000000000000000000000000000000..594991306c96f760fb79823c8a2c21c54723520e --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_7.txt @@ -0,0 +1,46 @@ +• Focused on a resilient sub-sector of the retail market +• Providing essential goods and services to communities +• Store-based network for omnichannel retail +• Well-positioned to withstand macroeconomic headwinds +See page 12 +• Retail Parks +• Core Shopping Centres +• Work Out +• Regeneration +See page 32 +• Market leading asset management team +• Scalable operational structure +• Data-driven approach +• Strong occupier relationships +• Expanding Capital Partnerships +See page 42 +• Unsecured balance sheet structure +• No debt maturity until 2028 +• Significant cash holdings +• Debt costs fixed until 2028 +See page 46 +MARKET +PORTFOLIO +PLATFORM +FINANCIAL +POSITION +5NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +We have a resilient investment case to deliver reliable and recurring revenues +See page 20 +We oversee and manage +our purpose, culture, values, +strategy, sustainability and +relationships through +effective Board leadership +and governance +Enabling us to generate +long-term value for +our stakeholders: +• Our team +• Our communities +• Our shareholders +• Our capital partners +• Our occupiers +• Our environment +See page 96 +The secret tool is a "saw". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_78.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_78.txt new file mode 100644 index 0000000000000000000000000000000000000000..bea91b4a558006caa62f000e4d2ab38c37b5cdd9 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_78.txt @@ -0,0 +1,59 @@ +Engaging our Occupiers +Occupier satisfaction is a core priority of our business; as such, we undertake routine surveys to gain insight into occupier opinions on material +topics such as the service-mindedness of our centre management teams and our sustainability programme. +The opportunity to respond to our 2022 survey was offered to 100% of our occupiers, and we received a total of 415 responses. Our next +survey will be undertaken in the autumn of this year. +We also received some helpful, constructive feedback which we would like to take this opportunity to respond to: +Feedback Item NewRiver Response +60% of retailers would be interested +to hear more from us on the overall +sustainability performance of their +individual centre. +We are working with our energy brokers to create a platform capable of storing and presenting +sustainability performance data for both the landlord and occupier areas of our portfolio. The +success of this solution will require collaboration with our occupiers, and we are hopeful that +this will deliver helpful insights to support a reduction in our collective environmental impact. +Our retailers advised us that they +would welcome more opportunities +to charge electric vehicles. +We currently have 123 new charging bays in the pipeline for near-term delivery across our +portfolio. We will also review further opportunities as part of the Green Travel Plan milestone +on our net-zero pathway (2024). +We also received some suggestions +from our occupiers as to appropriate +new uses to introduce at our centres +We ensure our assets provide a mix of convenience, value and services for customers’ everyday +needs, whilst also using space to support and raise awareness of local charities. The feedback +we receive through our occupier survey is invaluable to us in being able to achieve and maintain +this position. +KEY INSIGHTS +from our 2022 survey include: +86% +of retailers agree that their centre +manager is easily contactable, +responsive, and that general +communication is timely and effective. +89% +of respondents are satisfied with the +management of cleaning and waste +in common areas +Most of our occupiers are satisfied +with the various community events we +host throughout the year, as well as the +initiatives we implement to support the +elderly and people with disabilities +67% +of respondents rated their general +satisfaction as 8/10 or higher, +with 26% providing a rating of 10/10 +82% +of retailers agree that improving the +sustainability performance of their +business is important, with over 64% +rating it as “very important” +Most of our occupiers are satisfied with +the sustainability initiatives we implement +at our centres +76 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_79.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_79.txt new file mode 100644 index 0000000000000000000000000000000000000000..59a3ed40625400340e2d9167d86844d24337400f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_79.txt @@ -0,0 +1,81 @@ +Carving a collective pathway to Net-Zero +1. Correct as of September 2022 +In FY23 our support for the Trussell Trust provided: +158.5 hours +of volunteered support, with a + total value of £2,550* +4.5 tonnes +of food donations, once again this equates to approximately 59,300 +portions or £8,900 worth of pasta, enough dinners for.... +40 families of 4 +for a whole year +£125,633 +of direct monetary donations in FY23 +£66,320 +raised by over 30 NRR team members running 10k + * Based on the national TOMs Framework proxy value for voluntary +hours donated to support VCSEs (excluding expert business advice) +of £16.09 per hour +This year, to inform our occupier engagement strategy as part of our +journey to becoming a net-zero carbon business, we have +undertaken a review of our occupiers’ sustainability commitments +and emissions reduction ambitions, to understand current levels of +alignment and identify key areas in which to focus our engagement +efforts. +In reviewing occupier commitments, we were encouraged to learn +that 57% of our portfolio by floor area is occupied by retailers who’ve +already set emissions reduction targets, with a further 3% having +disclosed that they are in the process of developing targets1. Of the +57% occupied by retailers with existing commitments, 70% is +occupied by BRC Net-Zero Roadmap signatories. These +organisations have committed to work together with other retailers, +suppliers, government, and other stakeholders to bring the UK retail +industry’s emissions to net-zero by 2040. +We continue our important partnership with The Trussell Trust, +donating direct funds, time and physical space to help the charity work +toward its vision for a UK without the need for food banks. +Staff are able to participate in monthly volunteering opportunities with +our corporate charity partner, the Trussell Trust, or elect to utilise their +gifted volunteering time to support any cause that’s particularly close +to their hearts. +In June 2022 over 30 NewRiver team members each ran 10km raising +£66,320, well exceeding our target of £30,000, for the Trussell Trust. +57%40% +3% +70%70% +Commitment in development +No Commitment +Commitment Made +Occupiers committed to BRC +Occupier carbon emission reduction targets +58 +176 +92 +124 +Trussell Trust donations 2018-2022 Per £000 +2022 20232019 2020 2021 +58 +176 +92 +124 +Trussell Trust donations 2018-2022 Per £000 +2022 20232019 2020 2021 +£450k +of direct monetary +donations to date since our +partnership with the Trussell +Trust began in June 2019 +We were very pleased to learn, therefore, that the majority of our +occupiers share our sustainability vision. This exercise was also +helpful to us in understanding key areas in which we might be able to +offer insight and learnings to our occupiers as we work to achieve our +own net-zero targets. In particular, we hope to be able to support our +SME occupier base on this journey. +Having formalised our policy and framework for measuring embodied +carbon across our development and major refurbishment projects, +including lifecycle carbon targets reflective of industry best-practice +guidelines, we will shortly be providing guidance to our occupiers for +selecting materials in the fit-out and property maintenance processes +which reduce the embodied carbon impact of works. +Our Partnership with The Trussell Trust +77NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_8.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_8.txt new file mode 100644 index 0000000000000000000000000000000000000000..94e3aeddb52f72bb6c17af86d6872b1d13af2321 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_8.txt @@ -0,0 +1,63 @@ +28% +11% +23% +1% +37% +Retail Parks + Shopping Centres +– Core + Shopping Centres +– Regeneration +Shopping Centres +– Work Out +Other +Our resilient retail portfolio, focused on providing essential +goods and services to local communities, has once again +delivered a strong operational performance reflecting +the active occupational demand for space at our assets +and demonstrating the underlying resilience within our +portfolio and our platform. +Resilient retail at a glance +Portfolio segmentation +1. Retail Parks +2. Core Shopping Centres +3. Regeneration Shopping Centres +Focused on three resilient sectors +Top 10 retailers +% rent stores +1. 3.4% 20 +2. + 3.1% 10 +3. 2.4% 14 +4. 2.3% 4 +5. + 2.2% 14 +6. 2.1% 13 +7. 2.1% 5 +8. 2.0% 6 +9. + 1.6% 3 +10. 1.4% 11 +total 22.6% +FY21 FY22 FY23 +95.6% +95.8% +96.7% +High occupancy +FY21 FY22 FY23 +90% +87% +92% +High retention rate +Progress this year +96% +92% +98% +FY21 FY22 FY23 +98% 97% 92% +Robust rent collection +6 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic report +Our business +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_80.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_80.txt new file mode 100644 index 0000000000000000000000000000000000000000..5a0abe14a42d6ba3f6eae02205c493d01ee46a40 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_80.txt @@ -0,0 +1,59 @@ +Asset Social Performance Measures +EPRA Code Performance Measure Unit(s) of Measure Boundary FY23 FY22 +H&S-Asset Asset health and safety +assessments +Percentage of assets +Managed Assets +100% 100% +H&S-Comp Asset health and safety +compliance +Number of incidents +in reporting year +0 0 +Development and major +refurbishment project health +and safety compliance +Number of incidents +over past 3 years +0 – +Comty-Eng Community engagement, +impact assessments and +development programmes +Percentage of assets 100% 100% +A Mission for a Merry Christmas +Locks Heath Shopping Village in Fareham supported its local +‘Mission Christmas’ event during the festive period, where over +200 gifts were donated by the local community and employees. +These donations, along with others, were distributed to nearly +70,000 children and teens across the south coast who +otherwise wouldn’t have received a gift on Christmas Day. + +A Hole in One for Local Charities +Customers at the Ridings Centre, Wakefield supported their +favourite local charities, whilst testing their sporting prowess, by +trying to “get a hole in one” using their spare change at a +mini-golf themed donation point. Depending on where the coins +land, they are donated to one of four charities: The Trussell +Trust, Age UK, Wakefield Hospice, or Wakefield Street Kitchen. + +AT OUR CENTRES +Supporting our Communities +Supporting impactful local causes through the position we hold in our communities has +always been central to our culture and strategy of creating shared value for our stakeholders. +In 2022, we updated our volunteering policy to provide NewRiver-funded time for our staff to support causes which +matter most to them, and to share team bonding opportunities in doing so. +598 +hours spent by on-site +staff supporting  +community initiatives +£87,124 +Monetary donations raised +by aggregate charity +fundraising activities +259 +social, community +or charitable +initiatives supported +78 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_81.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_81.txt new file mode 100644 index 0000000000000000000000000000000000000000..b51ac4aeabfd3e3eca79721ec5b1a44e28644c18 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_81.txt @@ -0,0 +1,94 @@ +Our Governance of Sustainability and Climate-Related Matters +Our purpose is to buy, manage and develop retail assets across the UK which provide essential goods and services, supporting the +development of thriving communities. +Our Board recognises our responsibility to ensure our portfolio can weather the physical and transitional risks created by a changing climate to +ensure the long-term resilience of our business and the returns we achieve for our investors, as well as the all-important communities we serve. +Governance Performance Measures +EPRA +Code +Performance +Measure +Unit(s) of Measure FY231 FY222 +Gov- +Board +Composition of the highest +governance body +Number of executive +board members +2 2 +Number of independent/ +non-executive board +members +4 4 +Average tenure on the +governance body +3.6 4.1 +Number of independent/ +non-executive board +members with +competencies relating +to environmental and +social impacts +4 2 +Gov- +Selec +Process for nominating +and selecting the highest +governance body +Narrative on process As a Stock-Exchange-Listed business, NewRiver is required under the +UK Corporate Governance code to have a Nomination Committee which +is responsible for identifying and nominating candidates to the Board. +Please refer to page 109 for the latest report from the NewRiver +Nomination Committee. +Gov- +Col +Process for managing +conflicts of interest +Narrative on process As a Stock-Exchange-Listed business, NewRiver is required under the UK +Corporate Governance Code to identify and manage conflicts of interest. +Directors also have duties under the Companies Act 2006. To manage this +process, the Company Secretary keeps a register of all Directors’ interests. +The register sets out details of situations in which each Director’s interest +may conflict with those of the Company (situational conflicts). The register is +reviewed at each Board meeting so that the Board may consider and +authorise any new situational conflicts identified. At the beginning of each +Board meeting, the Chairman reminds the Directors of their duties under +sections 175, 177 and 182 of the Companies Act 2006, which relate to the +disclosure of any conflicts of interest prior to any matter that may be +discussed by the Board. +There is also a staff conflicts of interest policy in place which requires any +potential conflicts to be kept on a register and regularly updated. This is +reviewed by the Audit Committee on a six-monthly basis. + – Board oversight of +code of conduct +Narrative on process The Company has a code of conduct that is included in the staff handbook. +Non-compliance would be a staff disciplinary matter. The Board, through its +Audit Committee has oversight of non-compliance. The Company also has a +whistleblowing policy and process which is regularly reviewed by the audit +committee. There have been no instances of non-compliance. + – Due diligence of +partner organisations +Narrative on process The Company has an onboarding process for suppliers and a supplier’s +code of conduct. The Company also has a Modern Slavery policy. Suppliers +are required to confirm that they agree to this Modern Slavery policy as part +of the on-boarding process. + – Anti-corruption +measures +Narrative on process The Company has an Anti-bribery and anti-corruption policy. As part of this +policy there is a gifts and hospitality approval process and register. +A conflicts of Interest policy is also in place as well as a whistle-blowing +policy and process. + – Fines and settlements +in connection with +non-compliance with +environmental, anti-bribery/ +corruption, or other ESG- +related regulation +Total GBP of fines in past +three years, type of +non-compliance +£0, no incidences of non-compliance +1. 12-month period ending 31 December 2022 +2. 12-month period ending 31 December 2021 +GOVERNANCE +79NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_82.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_82.txt new file mode 100644 index 0000000000000000000000000000000000000000..a57b724ba5001faf66e9ea4c63ddee40ead91394 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_82.txt @@ -0,0 +1,81 @@ +TCFD: our journey +to climate resilience +NewRiver’s Board recognises the importance of adopting a sound +framework that supports the business to enhance the resilience of +our assets against the impacts of climate change. +NewRiver is committed to embedding the recommendations of the +Financial Stability Board’s Task Force on Climate-related Financial +Disclosures (TCFD) within our approach to climate-related risk +management. This disclosure aims to present a transparent account +of our processes designed to support our journey towards a +low-carbon business model, structured around the TCFD’s four +recommendation pillars: Governance, Strategy, Risk Management, +and Metrics and Targets. +Our 2023 disclosures represent our fifth consecutive TCFD report. +We consider that the following report is consistent with all of the +TCFD’s recommendations and recommended supporting disclosures; +these being the four pillars referenced above, and the eleven +disclosures within, which are signposted throughout this report. The +Governance +TCFD Governance Recommendation ‘a’: Describe the board’s oversight of climate-related risks +and opportunities +Our Board takes ultimate responsibility for our business’ resilience against climate issues and the transition of our portfolio to a low-carbon +operating model. Material climate issues are considered by the Board when reviewing NewRiver’s strategic approach to managing +associated impacts on the day-to-day operation of our assets, to preserve our ability to create value for our investors and communities. +Allan Lockhart, our Chief Executive and senior Board Director, retains overall accountability for our ESG programme and approach to +climate matters. +The Board’s oversight is supported by the ESG Committee, led by our Head of Asset Management and ESG, Emma Mackenzie. The +Committee meets quarterly to oversee NewRiver’s approach, which is guided by our Pathway to Net-Zero, whilst reviewing and ensuring +that appropriate resources are mobilised to enable proactivity. The Committee provides quarterly briefings to the Board, updating its +members on key milestones achieved by the ESG programme. +The Board and the Audit Committee adopts an integrated risk management approach, in which ESG and climate issues are embedded. +The Committee regularly evaluates NewRiver’s risk appetite, together with emerging and principal risks which are captured in the risk +register maintained by the Company. The Committee considers a range of risks across six risk categories, linked to our business model, +strategic priorities, and external environment. Climate-related risk represents one of the principal risk categories. The Committee regularly +evaluates changes to identified risks and ensures that appropriate controls are applied in alignment with the Board’s risk appetite. +During the reporting year, the Terms of Reference for our Executive Committee were updated to further clarify the role of the committee +members in managing climate-related risks as part of our ESG programme. We also appointed Dr Karen Miller to the Board as of Q1 FY23, +who has the climate-related expertise required to have specific responsibility for ESG matters across the business. +The Board received ESG training in FY22, including climate-related issues, and determined that additional ESG training would not be +required annually particularly given the strengthening of the Board in this area through the expertise of Dr Karen Miller. However, the +requirement for ESG training to the Board will be considered annually. The Board routinely considers the impact of climate-related issues +on the business, its assets and strategy throughout the year with key matters of concern or opportunity being escalated to the Board via +the CEO and ESG Committee; one example of this is the cost to the business to ensure the assets in England & Wales are MEES compliant +in line with the recent change to legislation. +TCFD Governance Recommendation ‘b’: Describe management’s role in assessing and managing +climate-related risks and opportunities. +Senior management is closely involved in our day-to-day approach to climate issues. Through her dual role as Head of Asset Management +and ESG, Executive Committee member Emma Mackenzie regularly engages with asset and property management teams to ensure +appropriate energy and carbon management processes and policies are integrated within all management activities. +In addition, asset and property management teams interact with centre management to ensure that policies are implemented across the +portfolio and that performance is tracked through our ESG programme. Quarterly performance updates are provided to the Board via the +ESG Committee. +Our internal teams and centre managers have all received ESG training during the year, delivered by our external consultants. We invest in +these sessions to ensure that management personnel are kept abreast of the latest developments in sustainability best practice and +evolving climate-related issues. +The Remuneration Committee includes an ESG objectives as part of the bonus objectives for both the Board and the Executive +Management. This is a pre-defined percentage of bonus with a high degree of measurability, and forms part of the overall performance +assessment for management. +TCFD’s Guidance for All Sectors has been considered in order to +achieve this stated level of consistency with the recommendations. +We also commissioned GRESB’s independent review of our 2022 +TCFD disclosures and were awarded an “A” alignment rating. This +review will be continuously evolving and we acknowledge the areas +for further improvement, such as enhanced granularity of our +disclosure in connection with the TCFD’s Strategy recommendation, +which will be supported by the commissioning of costed net-zero +plans for our assets (see page 86). +We continue to develop our capabilities and explore new methods +and technologies to support our response to emerging climate- +related risks. We have recently commissioned a portfolio-wide +assessment of physical climate-related risks, including how exposure +levels may change under different warming scenarios. We are also +focusing on deepening our understanding of our Scope 3 emissions +to reduce reliance on estimations in the way we account for them, for +example, in connection with the Scope 3 category of Downstream +Leased Assets, for which we are currently exploring a technology +solution via our energy brokers. +80 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued +The secret fruit is an "orange". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_83.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_83.txt new file mode 100644 index 0000000000000000000000000000000000000000..1095793d4ece3ab5b1345f300b466b172517067f --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_83.txt @@ -0,0 +1,82 @@ +Strategy +TCFD Strategy Recommendations ‘a’ and ‘c’: +Describe the climate-related risks and +opportunities the organisation has identified +over the short, medium, and long term; and +describe the resilience of the organisation’s +strategy, taking into consideration different +climate-related scenarios, including a 2ºC or +lower scenario. +NewRiver considers climate-related risks, as well as opportunities, +that may arise from both the physical impacts of climate change and +the transition of our managed assets across the UK to a low-carbon +operating model. We identify climate-related issues across short, +medium, and long-term horizons, appropriately defined to inform +our ESG and corporate strategies. +We have identified relevant short-range and long-range time horizons +separately for transition risks and physical risks due to both the +nature of the potential risks, our expectations for how they will +change over time, and the way in which we assess and manage them +as a business. We anticipate that relevant transition risks are likely to +be susceptible to a higher degree of change over a shorter period, +and so the transition risk time horizons we consider are: +Short: +<5 years +Medium: +5-15 years +Long: +>15 years +Physical risk time horizons are based on the IPCC definitions of short, +medium, and long-term climate models, which represent equal +20-year periods up to 2100. These periods have been used to assess +the exposure of our portfolio to climate change under three warming +scenarios, including a within 2oC scenario. The physical risk time +horizons we consider are:: +Short: +2021-2040 +Medium: +2041-2060 +Long: +2081-2100 +Our strategy is designed to enable us to build resilience +considerations into the acquisition and operation of our assets as an +integral part of our overall approach to asset management. As our +portfolio consists of assets located in the UK only, there is little +variation in exposure levels to both transitional and physical risks +and opportunities across our assets. Our net-zero pathway and +the interim targets we have set ourselves guide our approach to +remaining resilient to principal transition risks (refer to table on +page 82). The findings of our physical risk assessment and sensitivity +analysis using low and high carbon scenarios show that there is very +little change to the exposure of our portfolio to physical climate risks +in the best and worst case scenarios (refer to table on page 85), +with overall risk being relatively low. +Transition Risks & Opportunities +The table on page 82 outlines the principal transition risks we have +identified and the ways in which we expect their relevance to +NewRiver to evolve over the defined time horizons. Our assessment +considers risks and opportunities associated with keeping warming +to within 1.5-degrees above pre-industrial levels - as our strategy is +based on this objective – and therefore assumes that the end date +for achieving net-zero is 2050. +Generally, we consider that exposure to Policy & Legal, Technology +and Market-related risks is likely to peak in the medium-term, whilst +the reputational risk posed by an ineffective response to climate +change is assessed to remain relatively constant, although the +necessary actions to achieve an effective response will naturally +increase, which is reflected in the gradually broadening scope of +our emissions reduction targets over this period. +Should collective efforts to keep warming to within 1.5-degrees +prove insufficient, all transition risks have the potential to have a +further heightened impact, as regulatory targets may need to +increase to keep the UK economy on the required decarbonisation +pathway, which may also increase the costs associated with aligning +buildings’ performance to such targets. In this scenario, the need to +take prompt action would be even more critical, and the importance +to consumers of an effective response would also grow. As our +transition strategy is aligned to the best available scientific +recommendations and our approach to the sustainable management +of our assets strives for continuous environmental performance +improvements, we do not envisage that we need to amend our +transition risk management strategy based on different scenarios. +81NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_84.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_84.txt new file mode 100644 index 0000000000000000000000000000000000000000..c8fe72bc93568ac6abe7db160458bdadb3ad2204 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_84.txt @@ -0,0 +1,105 @@ +Term Impact Probability Relevance to NewRiver +Climate Change Strategy (Risk 4a1): +A failure to implement appropriate climate risk management measures, comply with evolving regulations and meeting our ESG targets could +impact the operation and value of our assets, leading to a risk of asset obsolescence, reputational damage and erosion of investor value + Policy & Legal +Energy +efficiency +and carbon +regulations +relating to +managed +assets +Evolving policy designed to +support the UK’s 2050 net-zero +commitment presents resource +requirements to manage +compliance efforts but also +highlights opportunities to r +educe costs through energy +efficiency and the transition of +assets to a low-carbon operating +model, improving resilience. +Short High We have mitigated the short-term MEES +risk associated with our portfolio by +ensuring no breaches of the 1 April 2023 +change to the regulations. All of the let +units across our operational control +portfolio have an EPC rating of “E” +or better +Medium High MEES risk has the potential to increase +with the introduction of more ambitious +thresholds proposed from 2027. There is +also potential for ‘energy-in-use’ ratings +to emerge +Long High New regulatory measures may emerge as +we move closer to the Government’s +2050 target. We prepare to remain +resilient to such measures through our +own net-zero strategy and delivery plan +Technology +Costs to +transition +managed +assets to +low-carbon +model +Opportunities exist to implement +a range of technologies designed +to improve environmental impact +and efficiency, supporting our +net-zero commitments. +Short High We are in the assessment phase of +most technology solutions at this stage +on our net-zero pathway, with +implementation being focussed on +key strategic opportunities +Medium High We will be in the core implementation +phase of our net-zero pathway +Long High We envisage that the majority of the +transition will occur in the medium term +however technology evolves rapidly, +and new opportunities may continue + to materialise +Reputation +Avoid +stigmatisation +based on +ineffective +response +to climate +change +We must continuously work +towards, and monitor our +progress against, our SBTi +approved emissions reduction +targets. Key milestones +consistent with a 1.5-degree +future include our 2030 and +2050 targets. Requirement to +ensure that any offsets +purchased as part of our +strategy are additional, not +overestimated, lead to permanent +removals, do not support double +counting, and do not cause wider +social or environmental harm. +Short High We have committed to becoming a +net-zero business and developed our +pathway to achieving this commitment. +Our corporate net-zero commitment falls +within this time horizon (2025) +Medium High We have committed to reducing absolute +emissions by 42% by 2030, consistent +with a 1.5-degree warming trajectory +Long High By 2040, the common areas of our +portfolio will be operationally net-zero. +By 2050, we will be a fully net-zero +carbon organisation +1. Please refer to Principal risks and uncertainties p.93 +Key +Impact and probability +Low Medium High +82 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_85.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_85.txt new file mode 100644 index 0000000000000000000000000000000000000000..cb427622269b9a1438ce46838fd8aa0071dd945c --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_85.txt @@ -0,0 +1,56 @@ +Term Impact Probability Relevance to NewRiver +Climate Change Impacts on our Assets (Risk 4b*): +Changes in the way consumers live, work, shop and use technology could have an adverse impact on demand for our assets. +Market +Changing +customer +behaviour +Changes in consumer shopping +preferences present an +opportunity to leverage our +ESG strategy to demonstrate +the ways in which we actively +cater to the evolving needs +of customers. +Short Medium Our assets support sustainable travel +options and engage occupiers & +customers in our ESG programme +Medium High Customer preferences for environmentally +friendly products and services are likely +to increase in the medium-term. Our +strategy is designed to keep pace with +this evolution +Long High In the long term, we envisage that there +will be less distinction between the +environmental credentials of different +products and services, as we move closer +towards a decarbonised economy +1. Please refer to Principal risks and uncertainties p.93 +We have reduced our total scope 1&2 emissions by 12% since our baseline year, which represents an annual rate of reduction consistent with +achieving our 2030 target to reduce these emissions by 42% in absolute terms. Actions we have taken over the past 12 months in order to +identify opportunities to ensure we continue on this pathway, which underpins our management of transition risks, include: + Management of transition risks +Policy & Legal Re-assessments of all of the units across our portfolio with F-G rated EPCs, to achieve an up-to-date +and accurate view of our exposure to MEES-related risks and the potential financial implications. +Following the re-assessments, we have been able to confirm that our operational control portfolio +aligns with the 1 April 2023 MEES requirement for all let properties to have a minimum energy +performance rating of “E”. Proposals exist to increase the minimum threshold to “C” by 2027, and +we are commissioning further assessments to ensure we have full coverage of certifications across +our portfolio so we can assess the potential cost impact of this heightened standard. +Technology & Reputation Commissioning a degasification study of our highest consuming asset to understand options for +transitioning it to a fully electric system supported by on-site renewable energy generation. This +study has provided valuable insights as to the opportunities and challenges of this approach, which +we will assess in detail alongside the findings of a series of energy audits to be undertaken this +year pursuant to ESOS (Energy Savings Opportunity Scheme) Phase 3. Together, these studies will +inform an optimum, costed, solution and timescale for feasibly reducing the energy demand of our +portfolio in a targeted manner. Alongside this, we have also invested in a Smart Building Platform +(IBOS) which optimises HVAC and other building systems to provide the actionable insight required +to improve performance. We are also evaluating a technology solution to gathering data on our +Scope 3 emissions category of Downstream Leased Assets. +Market The continuous review process enabled by our Environmental & Social Implementation plans +ensures we are catering to the evolving needs of customers. Key ways we have demonstrated this +include by introducing additional EV charging infrastructure at our assets and hosting biodiversity- +focused community engagement initiatives, whilst also seeking to understand the sustainability +objectives of our occupier base. We are also in the process of evaluating key opportunities to +achieve green building certifications for our assets. +83NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_86.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_86.txt new file mode 100644 index 0000000000000000000000000000000000000000..80b22ac765baeb59b6a94e822130939928b0fe35 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_86.txt @@ -0,0 +1,44 @@ +84 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our ESG approach continued +Physical Risks & Opportunities +The table on page 85 depicts the principal climate hazards we have +identified to be relevant to NewRiver’s portfolio and the extent to which +exposure levels are projected to change over time under high and low +carbon future scenarios. The assessment modelled three climate +scenarios in total: SSP1-2.6, a low carbon scenario corresponding to +approximately 2°C of warming at the end of the century, SSP2-4.5, an +in-between scenario available for some specific climate hazards, and +SSP5-8.5, a high carbon scenario corresponding to approximately 4 to +5°C warming at the end of the century. The figure presents the findings +of the SSP1-2.6 and SSP5-8.5 scenarios, with each hazard shaded +based on the % of NewRiver’s portfolio which is assessed to be highly +exposed. +Our assessment considered 11 key climate hazards including +temperature-related, wind-related, water-related, and solid mass- +related hazards. Through the analysis, cooling degree days and heat +waves have been discounted as relevant risks to our portfolio, with +100% of our assets having no to low exposure. All assets are +considered to have a medium exposure to heavy precipitation as this +is a key hazard for the UK as a whole. Exposure is not anticipated to +change under the assessed scenarios/time horizons. Wildfire +exposure was also considered as it’s an emergent hazard. Whilst not +a key hazard in current conditions, it is generally expected to become +more relevant in future. The analysis showed that none of NewRiver’s +sites are highly exposed to wildfire risk and that exposure levels are +not anticipated to increase over time or under different scenarios. +Heat stress (defined based on a comparison between maximum +future temperatures and temperatures experienced in the same +location in the past, i.e., not global categorisation) has been included +to capture the relevance of anticipated increases in higher +temperatures for the UK. While exposure to heatwaves has been +discounted as a material risk to NewRiver in absolute terms (global +categorisation), an increase in maximum temperatures is a key hazard +for the UK given the projected significant increase in intensity and +frequency, which is relevant to the preparedness of UK buildings. +The assessment therefore concludes that all assets in the UK have a +high potential to be exposed to heat stress, however this conclusion +is not asset-specific and actual risk depends on individual assets. +Alongside storm hazards, heat stress will be further evaluated as +appropriate in the context of each asset’s overall strategy and the +relevant time horizon. \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_87.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_87.txt new file mode 100644 index 0000000000000000000000000000000000000000..1d14c9cbf198f2021ae58fff90ca2f70c22a0413 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_87.txt @@ -0,0 +1,97 @@ +85NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Low Carbon Scenario High Carbon Scenario +Short +2021-2040 +Medium +2041-2060 +Long +2081-2100 +Short +2021-2040 +Medium +2041-2060 +Long +2081-2100 +Summary of +hazard exposure +Summary of +hazard impact +Heat stress +Same level of exposure +as all buildings in the +UK, as asset-specific +analysis has not +been undertaken. +The potential impact of this hazard on +our assets is higher cooling, and +therefore energy, demand. Increased +energy demand in turn increases +operational and maintenance costs. +Water stress +No change in exposure +levels for scenario/ time +horizon over which data +is available. Exposure +level is never more +than 20%. +Water stress is pressure on the quantity +and quality of available water resources. +Prolonged water stress can have a +negative impact on public health and +economic development. +Storm +No significant changes +in exposure over time +and scenario. Range is +between 59-65%. +Storms are identified as a key current +hazard for our portfolio, with the +potential impact being damage to +external building elements. We +undertake building safety assessments +which review the risk of loose roof/ +facade features, which support +mitigation of this risk. +Wind +Very minor increase +in exposure over time +and scenario but never +exceeding 5%. +The potential impact of this hazard is +closely linked to the above commentary +regarding storm damage. +Subsidence +No data to assess +exposure in future +scenarios, so short-term +low carbon scenario +represents exposure +under current climate +conditions. +Increases in other climate hazards +such as flooding could increase the +likelihood of subsidence. This poses a +risk of damage to properties. +Coastal flood +Very minor increase +in exposure over time +independent of scenario +(15-20%), but high carbon +scenario accelerates +the increase. +As with storms and subsidence, +flooding has the potential to cause +damage to structural building elements, +but also to goods stored within our +assets. We maintain a flood risk register +to monitor risk exposure and identify +any need for intervention measures. +Our assets are insured against this risk. +Fluvial flood +Constant low exposure +over time (11%). Data +only available for high +carbon scenario. +ChronicAcute +Unavailable 20-40% 60-80% +0-20% 40-60% 80-100% \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_9.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_9.txt new file mode 100644 index 0000000000000000000000000000000000000000..89d4b5fcf7ceab4592e6cb46a3c57e69cd82fccf --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_9.txt @@ -0,0 +1,68 @@ +Resilient retail: 10 key characteristics +CAGR: percentage per annum growth of new rent vs +previous passing rent, over period of previous lease length +Leasing Pricing: long term rent secured in leasing +activity vs valuer ERV +-0.4% +-0.3% +-0.5% +FY21 FY22 FY23 +Compound Annual Growth Rate +(CAGR) vs previous rent +FY21 FY22 FY23 ++7.4% ++0.6% ++1.1% +Strong leasing pricing vs ERV +FY21 FY22 FY23 +£11.74 +£11.51 +£11.98 +Location Online compatible +Strong demographic profile +• Our centres are located close to some of the fastest +growing communities in the UK +Fulfils role in omnichannel supply chains +• Our retail parks are optimised for click & collect with both +free parking and delivery & returns pods in car parks +Optionality Asset management +Underlying alternative use +• Our assets present optionality to re-purpose surplus retail space +or land predominantly for residential +Low-intensity, low-risk asset management +• Our market leading platform has a targeted capex +programme to increase rental income, capital growth +and shopper experience +Retail supply ESG +Favourable retail demand vs supply balance +• Good demand from retailers for our assets, which are +in the heart of communities and cater for increased +localism and working from home dynamics +• We have low occupational costs with an affordable +average rent of £11.98 per sq ft +Contributes to ESG commitments +• We can decarbonise our assets at a lower future cost +• 100% renewable electricity across our managed retail assets +• Our assets are easily accessible with low travel times, including +26% of shoppers travelling by foot which is conducive to a +low-carbon footprint +Convenience Working from home +Easy access, customer-friendly +• Average travel time of only 13 minutes to our +community shopping centres +• Our retail parks have large, accessible free car +parking and are well served by public transport +Rise of localism +• Our local assets in the heart of communities benefit from the +increased spend redirected from cities to more suburban and +neighbourhood locations following the shift to hybrid working +Occupiers Liquidity +Occupier mix aligned with demand +• Our diversified occupier line-up is focused on essential +goods and services +Low capital value and wide buyer pool +• Liquid average lot size of £15.9 million +-0.5%+1.1%£11.98 +psqf +Affordable average rent +7NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_90.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_90.txt new file mode 100644 index 0000000000000000000000000000000000000000..24560965d2dc32342169fa056c88a14ebfd82b4d --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_90.txt @@ -0,0 +1,92 @@ +Managing our risks +and opportunities +Principal risks and uncertainties +Risk is inherent in all businesses and effective risk management enables us to +manage both the threats and the opportunities associated with our strategy and +the operation of our business model. +Risk monitoring and assessment +including emerging risks +The identification of risks and their management is a continual and +evolving process. This has been underscored more so over recent years +by the global pandemic which created uncertainty across all sectors, both +economically and socially. This has been followed with an economic +turndown and cost of living crisis which has continued the uncertainty. +Other geopolitical events such as the Russian-Ukraine crisis have also +impacted supply chains and sentiment. +The Company maintains a risk register in which a range of categories are +considered. These risks are linked to the business model and strategic +priorities of the Company. The risk register assesses the impact and +probability of each identified risk. By identifying all risks on a register and +continuously updating this register, principal risks can be identified as +those that might threaten the Company’s business model, future +performance, solvency or liquidity and reputation. Their potential impact +and probability will also be a factor in whether they are classed as +principal. The risk register also records actions that can be taken to further +mitigate the risk and each action is assigned to an individual or group. +Mitigation factors and actions are assigned to all risks whether they are +principal, non-principal or emerging. +The continuous updating of this risk register allows us to assess how risks +are evolving, assists in identifying emerging risks as they develop and +ensures that the impact of each identified risk is continually monitored as +it emerges and progresses. During the year we have identified an +emerging depositor risk as our cash holdings have built up. This risk is not +a principal risk but by identifying this emerging risk as it has developed, +we have been able to update our treasury policies to ensure that they are +fit for purpose and that cash is spread across various banking institutions. +Our small workforce encourages flexibility +and collaboration across the business in +all areas including risk management. The +accessibility and flexibility of the Board and +senior staff are particularly pertinent when +adapting to evolving risks, emerging risks +and external risks such as the aftereffects of +a global pandemic and geopolitical instability. +This flexibility enables the business to adjust +and respond to fast-changing situations and +prove its resilience and adaptability. +The Board has ultimate responsibility for +the risk management and internal controls +framework of the Company and regularly +evaluates appetite for risk, ensuring our +exposure to risk is managed effectively. +The Audit Committee monitors the +adequacy and effectiveness of the +Company’s risk management and internal +controls and supports the Board in assessing +the risk mitigation processes and procedures. +The Executive Committee is closely involved +with day-to-day risk management, ensuring +that it is embedded within the Company’s +culture and values and that there is a +delegation of accountability for each +risk to senior management. +A Board approved counterparty list is continuously monitored using +S&P and Fitch credit ratings. The treasury policy dictates the maximum +exposure to a counterparty based on their rating. The operation of the +treasury policy is reported to the Board on a quarterly basis. This +emerging risk has also created an opportunity as the Group has +been able to take advantage of favourable deposit opportunities. +Risk appetite and mitigation +The Board has a low-risk appetite for compliance (legal and regulation) +related risk. The Board however recognises that the external environment +in which it operates is inherently risky. Mitigating actions are therefore +agreed for all risks that exceed the Group’s risk appetite. Our +experienced leadership team continuously works to mitigate the risks +arising from the external environment in some of the following ways: +• Maintaining an unsecured balance sheet, with the Company +benefiting from a more diversified debt structure and gaining +access to a larger pool of capital to help achieve our strategic goals +• A disciplined approach to stock selection with probability +risk-adjusted returns +• Deploying capital in joint ventures and associates, +thereby diversifying risk +• A diverse tenant base in which there is no single tenant exposure +of more than 4% +• An experienced Board and senior management +All risks on the register are ‘scored’ in terms of impact and probability. +A risk heat map can be a useful visual aid to understand the potential +impact and probability of each significant risk on a gross basis prior +to mitigation. Our heat risk map is set out overleaf. +88 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_91.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_91.txt new file mode 100644 index 0000000000000000000000000000000000000000..ad3216bae94c344cdbdca5dccbedbd43f995a121 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_91.txt @@ -0,0 +1,67 @@ +BOARD +Collectively responsible for managing risk, overseeing the internal controls framework and determining risk appetite +AUDIT COMMITTEE +Oversees the risk management process +• Regularly reviews risks within strategy discussions, the impact of +risk on strategy and levers within the business model that can be +adjusted to manage these risks. +• Conducts formal reviews of principal risks (including emerging risks) +at least twice a year - one of which is in connection with consideration +of the viability statement. +• Monitors KPI’s which link to risk and strategy through Board reports. +• Conducts formal reviews of the risk management process twice +a year - one of which is in connection with consideration of the +viability statement. +• Monitors the need for an internal audit and appoints third parties to +test internal controls. +• Monitors the internal controls framework. +• Considers the use of external advisors for specific specialist risk +impacts and deep-dive reviews. +• Receives reports on the risk management process twice annually. +EXECUTIVE COMMITTEE +Regularly reviews the entire risk register - members are responsible for managing risk within their area of accountability +COMPANY SECRETARY +Conducts individual risk reviews with ExCo members and individual business areas. +Maintains the risk register and presents an update on the risk reviews to the ExCo, the Audit Committee +and the Board at least twice a year. Has responsibility for training staff on policies and regulations. +ASSET MANAGERS +Members are responsible for managing risk within their assets and highlighting risks as they emerge +• Conducts reviews of the entire risk register (which includes +emerging risks) at least quarterly. +• Delegates line responsibility for managing risks within their +area of accountability. +• Reviews risk topics through regular timetabled presentations +or papers. +• Uses external advisors for specific specialist risk impacts. +• Monitors KPIs which link to risk and strategy. +The Risk Governance and responsibility +Risk matrix +External risks +Principal risks +Operational risks + Movement from FY22 +The risk matrix sets out gross risk (i.e. our assessment of the +impact and probability of risks prior to any mitigating factors). +All risks have mitigating actions associated with them. +Macroeconomic +Political and regulatory +Catastrophic external event +Climate change strategy +Climate change impacts +on our assets +Changes in technology +and consumer habits and +demographics +Cyber security +People +Financing +Asset management +Development +Acquisition +Disposal +a +a +b +b +89NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret flower is a "tulip". \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_92.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_92.txt new file mode 100644 index 0000000000000000000000000000000000000000..6e795c87457172cd073c112a2664e72df0881a87 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_92.txt @@ -0,0 +1,131 @@ +External risks +Risk and impact Monitoring and management Change in risk assessment +during the period +1. Macroeconomic +Economic conditions in the UK and changes to +fiscal and monetary policy may impact market +activity, demand for investment assets, the +operations of our occupiers or the spending +habits of the UK population. +• The Board regularly assesses the Company’s +strategy in the context of the wider +macroeconomic environment. This continued +review of strategy focuses on positioning our +portfolio for the evolving economic situation. +• The Board and management team consider +updates from external advisers, reviewing +key indicators such as forecast GDP growth, +employment rates, interest rates and Bank +of England guidance and consumer +confidence indices. +• Our portfolio is focused on resilient market +sub-sectors such as essential retailers. +• Through regular stress testing of our +portfolio we ensure our financial position +is sufficiently resilient. +• Closely monitoring rent collection and cash flow. +• Macroeconomic risk has remained the same +during the year and is considered a medium to +high impact risk with a high probability. +• Sentiment has been impacted by the cost of +living crisis, energy cost worries and inflation. +• Overall valuations slightly decreased in the +second half of the year however due to a fully +covered dividend our covenant and policy +headroom remains high. +• Higher inflation could fuel wage growth +and costs leading to rate increases above +current forecasts. +• The Bank of England is expecting inflation to +fall during 2023 and is working with interest +rate adjustments to reduce inflation to fall to its +2% target in around two years’ time. +Responsibility: +Board & ExCo +Link to strategy: +Impact: +Probability: +Movement: +2. Political and regulatory +Changes in UK Government policy, the +adverse effects of Brexit on our tenants, +or the impact of political uncertainty on +consumers’ retail and leisure spend. +• The Board regularly considers political and +regulatory developments and the impact they +could have on the Company’s strategy and +operating environment. +• External advisers, including legal advisers, +provide updates on emerging regulatory +changes to ensure the business is prepared +and is compliant. +• We regularly assess market research to +gauge the impact of regulatory change +on consumer habits. +• We carry out stress testing on our portfolio in +relation to regulatory changes which may +impact our operations or financial position. +• Where appropriate, we participate in industry +and other representative bodies to contribute +to policy and regulatory debate. Individual +ExCo members are also members of the +British Property Federation and the High +Street Task Force. +• Political and regulatory risk has remained +the same during the year. This is considered +a medium to high impact risk with a +high probability. +• There has been political uncertainty within the +UK due to changes in leadership and a decline +in market confidence. This is likely to continue +with a general election within the next +18 months. There have also been political +failures at a local authority level. +• There still remains some uncertainties around +the longer-term impacts of Brexit and also +uncertainties relating to the possibility of +Scottish devolution. +• The Coronavirus Act imposed a moratorium on +landlords’ ability to forfeit leases of commercial +property for non-payment of rent in England +and Wales and Northern Ireland. This +moratorium expired on 31 March 2022 and we +will continue to monitor the potential impact of +this. There are further uncertainties around the +outcome of the Government review of the +Landlord and Tenant Act 1954. +• There are also uncertainties around the impact +of the Levelling Up and Regeneration Bill. +• The long-term impact on the property market +of the Register of Overseas Entities owning UK +property is currently unclear. +Responsibility: +Board & ExCo +Link to strategy: +Impact: +Probability: +Movement: +Principal risks and uncertainties continued +Key +Risk change during FY23 +Risk has increased Risk has decreased Risk has not changed +Impact and probability +Low Medium High +The Principal risks are: +External risks Operational risks +1. Macroeconomic +2. Political and regulatory +3. Catastrophic external event +4a. Climate change strategy +4b. Climate change impacts on our assets +5. Changes in technology and consumer habits and demographics +6. Cyber Security +7. People +8. Financing +9. Asset management +10. Development +11. Acquisition +12. Disposal +90 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_93.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_93.txt new file mode 100644 index 0000000000000000000000000000000000000000..30893c4b781d561fd8c24f82048b518d1d59b73e --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_93.txt @@ -0,0 +1,147 @@ +Risk and impact Monitoring and management Change in risk assessment +during the period +3. Catastrophic external event +An external event such as civil unrest or a civil +emergency including a large-scale terrorist +attack or pandemic, could severely disrupt +global markets and cause damage and +disruption to our assets. +• The Board has developed a comprehensive +crisis response plan which details actions to +be taken at a head office and asset-level. +• The Board regularly monitors the Home +Office terrorism threat level and other +security guidance. +• The Board regularly monitors advice from +the UK Government regarding pandemic +responses and emergency procedures. +• Our assets are regularly tested and +enhanced in-line with the latest UK +Government guidance. +• We have robust IT security systems which +cover data security, disaster recovery and +business continuity plans. +• The business has comprehensive insurance in +place to minimise the cost of damage and +disruption to assets. +• Catastrophic external event risk has +remained the same during the year and is +considered a high impact risk with a medium +to high probability. +• The aftereffects of a global pandemic caused +unprecedented economic and operational +disruption and the continuing global +developments create uncertainty. We however +were able to mitigate the impact through our +portfolio positioning focusing on essential goods +and services, our cash position and liquidity and +our active approach to asset management. +• The relaxing of restrictions was positive but the +cost-of-living crisis has impacted UK households. +Our operational performance has however +demonstrated the resilience of our portfolio. +• The National Terrorism Threat Level is +substantial and the full long-term impact from +the war in Ukraine is unclear. +Responsibility: +Board & ExCo +Link to strategy: +Impact: +Probability: +Movement: +4a. Climate change strategy +A failure to implement appropriate climate risk +management measures, comply with evolving +regulations or meet our ESG targets could +impact the operation and value of our assets, +leading to a risk of asset obsolescence, +reputational damage and erosion of +investor value. +• We have a comprehensive ESG programme +which is regularly reviewed by the Board and +Executive Committee. A detailed overview of +the programme can be found in the ESG +section of this report. +• One of the key objectives of the programme is +to minimise our impact on the environment +through reducing energy consumption, +sourcing from renewable sources and +increased recycling. +• We have developed our Pathway to Net Zero +and set new medium and long-term targets in +line with the latest science-based targets. +• ESG performance is independently reviewed +by our external environmental consultants +and is measured against applicable targets +and benchmarks. +• We continue to report in line with +TCFD requirements. +• The climate change risk was separated last +year into two risks to focus on its constituent +parts (Climate change strategy and Climate +change impacts on our assets). +• Climate change strategy risk remained the +same during the period and is considered a +medium to high impact risk with a medium to +high probability. +• ESG has risen up the agenda of many +stakeholders and expectations of compliance +with best practice have increased. +• Regulatory requirements have also increased +during the period, in addition to the scoring +criteria for certain ESG benchmarks such +as GRESB. +• Our ESG Committee pre-empted these +changes and our initiatives and disclosure +continue to evolve in-line with best practice. +• ESG is embedded into capital allocations and +is considered for all future acquisitions. +Responsibility: +Board & ExCo, CEO and ESG Committee, +Head of ESG +Link to strategy: +Impact: +Probability: +Movement: +4b. Climate change +impacts on our assets +Adverse impacts from environmental incidents +such as extreme weather or flooding could +impact the operation of our assets. A failure +to implement appropriate climate risk +management measures at our assets could +lead to erosion of investor value and increases +in insurance premiums. +• We regularly assess assets for environmental +risk and ensure sufficient insurance is in +place to minimise the impact of +environmental incidents. +• In conjunction with insurers flood risk +assessments have been carried out at all of +our assets and the risk is considered low. +• The climate change risk was separated into +two risks last year to focus on its constituent +parts (Climate change strategy and Climate +change impacts on our assets). +• Climate change impacts on our assets risk +remained the same during the period and is +considered a medium to high impact risk with +a medium to low probability. +• Although exposure to extreme weather events +is a near-term risk, other climate impacts such +as heat stress and sea level rises are medium +term or long-term time horizons. Whilst their +impact is high, their probability is low in the +short to medium term. +• Climate impacts are embedded into capital +allocation decisions and considered for all +future acquisitions of both equipment installed +at our assets and for the assets themselves. +Responsibility: +Board & ExCo, CEO and ESG Committee, +Head of ESG +Link to strategy: +Impact: +Probability: +Movement: +91NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_94.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_94.txt new file mode 100644 index 0000000000000000000000000000000000000000..073b2248abd3309f9da8fa121af03aa10035575b --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_94.txt @@ -0,0 +1,94 @@ +External risks continued +Risk and impact Monitoring and management Change in risk assessment +during the period +5. Changes in technology and +consumer habits and demographics +Changes in the way consumers live, work, +shop and use technology could have an +adverse impact on demand for our assets. +• The Board and Executive Committee regularly +assess our overall corporate strategy and +acquisition, asset management and disposal +decisions in the context of current and future +consumer demand. Our strategy is designed +to focus on resilient assets that take into +account these future changes. +• We closely assess the latest trends reported +by CACI, our research provider, to ensure we +are aligned with evolving consumer trends. +• Our retail portfolio is focused on essential +spending on goods and services which are +resilient to the growth of online retail. +• Our retail parks are ideally positioned to help +retailers with their multi-channel retail strategies. +• Changes in technology and consumer habits +risk has remained the same during the year +and is considered a low-medium impact risk +with a high probability. +• Although the global pandemic lockdown +restrictions significantly increased home working +and online shopping in recent years, we have +seen evidence that this is unwinding. Our +portfolio is focused on providing essential retail +to local communities, which continues to mitigate +the impact of online retail on our portfolio. +• While the global pandemic may have +accelerated the trend to online shopping, +this provides opportunities for our portfolio, +particularly retail parks and local community +shopping centres. +• Our strategy is to reshape our portfolio to +ensure over the longer term we have the most +resilient retail portfolio in the UK. +Responsibility: +Board & ExCo +Link to strategy: +Impact: +Probability: +Movement: +6. Cyber security +A cyber attack could result in the Group being +unable to use its IT systems and/or losing data. +This could delay reporting and divert +management time. This risk could be +increased due to many employees working +from home during the pandemic. +• There are limited IT servers on sites. Multiple +third-party supplier programmes are used +which have their own security systems and are +independently audited by Deloitte and +ISO2000 accredited. +• ExCo receives quarterly reporting on IT matters. +• Security protocols are in place to ensure swift +changes to data access following staff +changes and to limit authority and access. +• We have reviewed our IT systems and have +enhanced a number of areas during the year. +• Cyber insurance cover is in place. +• We have recently carried out an external +review of the Group’s IT security and systems +as part of our internal audit process. +• Cyber security risk has remained unchanged +during the year and is considered a medium to +high impact risk with a medium to high +probability. Whilst global developments have +increased cyber security risks we have carried +out further enhancements and audits to our IT +systems and procedures during the year. +• This risk was considered to be increased due +to employees working from home during the +pandemic. Staff may now continue to work +from home on a flexible basis. Responsibility: +Board & ExCo,and Head of IT +Link to strategy: +Impact: +Probability: +Movement: +Key +Risk change during FY23 +Risk has increased Risk has decreased Risk has not changed +Impact and probability +Low Medium High +92 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Principal risks and uncertainties continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_95.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_95.txt new file mode 100644 index 0000000000000000000000000000000000000000..459c5bb3fd32439faf0b686577a8c4bca156cc0e --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_95.txt @@ -0,0 +1,153 @@ +Operational risks +Risk and impact Monitoring and management Change in risk assessment +during the period +7. People +The inability to attract, retain and develop +our people and ensure we have the right skills +in place could prevent us from implementing +our strategy. +• Attracting, retaining and developing talent is +core to our HR strategy, which is regularly +reviewed by the Board and Executive +Committee. +• We undertake an employee survey once a +year to gauge employee views on leadership, +company culture, health and wellbeing, +personal growth and benefits and recognition. +This informs any changes to HR policy. +• We regularly benchmark our pay and benefits +against those of peers and the wider market. +• Succession planning is in place for all key +positions and is reviewed regularly by the +Nomination Committee. +• Longer notice periods are in place for key +employees. +• Our recruitment policies consider the needs of +the business today and our aspirations for the +future, whilst ensuring our unique corporate +culture is maintained. +• The probability of the People risk has reduced +during the year and is considered a medium +impact risk with a medium probability. +• Inflation has put pressure on salary costs and +demands. This impact is mitigated by an active +employee engagement programme and the +alignment of reward with both individual and +Company-level performance. +• We continue to focus on staff wellbeing and +actively seek regular feedback from staff. The +recent Sunday Times Best Places to Work +2023 survey was strongly positive and +showed a low staff flight risk. +• We also offer many forms of flexible working +including job share, annualised hours, variation +of hours and working from home. Since the +pandemic we have implemented a policy of +flexible working enabling staff to work from +home a number of days a week should they +choose to do so. +Responsibility: +Remco, ExCo, SID (as employee +engagement director), Head of HR +Link to strategy: +Impact: +Probability: +Movement: +8. Financing +If gearing levels become higher than our risk +appetite or lead to breaches in bank +covenants this would impact our ability to +implement our strategy. The business could +also struggle to obtain funding or face +increased interest rates as a result of +macroeconomic factors. +• The Board regularly assesses Company +financial performance and scenario testing, +covering levels of gearing and headroom to +financial covenants and assessments by +external rating agencies. +• The Company has a programme of active +engagement with key lenders and +shareholders. +• The Company has a wholly unsecured balance +sheet, which mitigates the risk of a covenant +breach caused by fluctuations in individual +property valuations. +• The Company has long-dated maturity +on its debt, providing sufficient flexibility +for refinancing. +• Working capital and cashflow analysis and +detailed forward assessments of cashflows +are regularly reviewed by the +Executive Committee. +• Our credit rating is independently assessed +by Fitch Ratings at least annually. +• Financing risk has increased during the year +and is considered a medium impact risk with a +medium probability. +• Macroeconomic developments, particularly the +increase in inflation, have impacted financial +markets. The strength of the Company’s +unsecured balance sheet means we have +significantly mitigated the risk of not being +able to secure sufficient financing. Increased +cash levels also mitigated these risks and +provide deposit opportunities. +• The Company extended the maturity on its +undrawn Revolving Credit Facility to August +2024 in the prior year. +• There is no exposure to interest rate rises on +drawn debt. +Responsibility: +ExCo & CFO +Link to strategy: +Impact: +Probability: +Movement: +9. Asset management +The performance of our assets may not meet +with the expectations outlined in their business +plans, impacting financial performance and the +ability to implement our strategies. +• Asset-level business plans are regularly +reviewed by the asset management team and +the Executive Committee and detailed +forecasts are updated frequently. +• The Executive Committee reviews whole +portfolio performance on a quarterly basis to +identify any trends that require action. +• Our asset managers are in contact with centre +managers and occupiers on a daily basis to +identify potential risks and improvement areas. +• Revenue collection is reviewed regularly by +the Executive Committee. +• Retailer concentration risk is monitored, with +a guideline that no retailer will account for +more than 5% of gross income (currently our +largest retailer is Poundland accounting for +3.4% of gross income). +• Asset management risk has remained +the same during the year and is considered +a medium to high impact risk with a +medium probability. +• The global pandemic placed restrictions on +the operations of our occupiers and impacted +performance and rent collection at our assets. +These have improved greatly and are now +close to pre-pandemic levels. +• Our diverse tenant portfolio focuses on +essential retail which reduces the impact of +individual defaults on income. +• Although we have a low probability of default, +the continued cost of living crisis may impact +the financial health of our occupiers. +• Our operational performance continues to +prove the resilience of our assets. +Responsibility: +ExCo, Emma Mackenzie, Head of Asset +Management and the Asset Managers +Link to strategy: +Impact: +Probability: +Movement: +93NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_96.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_96.txt new file mode 100644 index 0000000000000000000000000000000000000000..9d3b2543d93ec178b07329e8e03a32cce3b4d158 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_96.txt @@ -0,0 +1,123 @@ +Risk and impact Monitoring and management Change in risk assessment +during the period +10. Development +Delays, increased costs and other challenges +could impact our ability to pursue our +development pipeline and therefore our ability +to profitably recycle development sites and +achieve returns on development. +• We apply a risk-controlled development +strategy through negotiating long-dated +pre-lets for the majority of assets. +• All development is risk-controlled and forms +only 3% of the portfolio by value. +• Capital deployed is actively monitored by the +Executive Committee, following detailed due +diligence modelling and research. +• An experienced development team monitors +on-site development and cost controls. +• On large scale developments where +construction is more than 12 months we look +to carry out the project in partnership and/or +forward sell. +• Development risk probability has increased +through the period and is considered a medium +impact risk with a medium to high probability. +• Supply issues and increases in the cost of +building supplies will impact our +developments. As they remain a small part of +portfolio the overall impact is low. +• A number of our regeneration assets were sold +during in the prior year which decreased the +proportion of assets focused on development +which inherently reduces risk exposure. +Responsibility: +Board & ExCo, +Development team leaders +Link to strategy: +Impact: +Probability: +Movement: +11. Acquisition +The performance of asset and corporate +acquisitions might not meet with our +expectations and assumptions, impacting our +revenue and profitability. +• We carry out thorough due diligence on all +new acquisitions, using data from external +advisers and our own rigorous in-house +modelling before committing to any +transaction. Probability-weighted analysis +takes account of these risks. +• Acquisitions are subject to approval by the +Board and Executive Committee, who are +highly experienced in the retail sector. +• We have the ability to acquire via joint +ventures, thereby sharing risk. +• Acquisition risk has remained the same +through the year and is considered a medium +impact risk with a medium probability. +• The lack of supply and relative price of some +assets may reduce opportunities for acquisition. +• Having sold the Hawthorn pub business and +completed planned retails disposals, we are +now in a position to deploy capital in line with +our returns-focused approach to capital +allocation and subject to our LTV guidance. +Responsibility: +Board & ExCo, +Charles Spooner, Head of Capital Markets +Link to strategy: +Impact: +Probability: +Movement: +12. Disposal +We may face difficulty in disposing of assets or +realising their fair value, thereby impacting +profitability and our ability to reduce debt +levels or make further acquisitions. +• Our portfolio is focused on high-quality assets +with low lot sizes, making them attractive to a +wide pool of buyers. +• Assets are valued every six months by +external valuers, enabling informed disposal +pricing decisions. +• Disposals are subject to approval by the Board +and Executive Committee, who are highly +experienced in the retail sector. +• Our portfolio is large and our average asset lot +size is small, meaning that each asset +represents only a small proportion of revenues +and profits, thereby mitigating the impact of a +sale not proceeding. +• Disposal risk has increased during the year +and is considered a medium impact risk with +a medium to high probability. +• National and geopolitical uncertainty, interest +rate rises, inflation and the cost-of-living crisis +have increased market uncertainty and are +causing some purchasers to reconsider or +delay acquisition decisions. +• We have an active and successful disposal +programme where we have executed +disposals in the year, with the volume of +transactions being completed increasing +disposal risk. The average lot size however is +lower than most in the market so our assets +tend to be more liquid. +Responsibility: +Board & ExCo, +Charles Spooner, Head of Capital Markets +Link to strategy: +Impact: +Probability: +Movement: +Operational Risks continued +Key +Risk change during FY23 +Risk has increased Risk has decreased Risk has not changed +Impact and probability +Low Medium High +94 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Principal risks and uncertainties continued \ No newline at end of file diff --git a/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_97.txt b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_97.txt new file mode 100644 index 0000000000000000000000000000000000000000..1ca5908285b410afa4551a6833d7c011c9982998 --- /dev/null +++ b/NewRiver/NewRiver_150Pages/Text_TextNeedles/NewRiver_150Pages_TextNeedles_page_97.txt @@ -0,0 +1,114 @@ +Viability statement +Period of assessment +The UK Corporate Governance Code requires the Directors to +appraise the viability of the Group over what they consider to be an +appropriate period of assessment taking into account the Group’s +current position, its business model (pages 11 and 18), strategy (pages 4 +and 11) and principal risks and uncertainties (pages 88 to 94). +In making this assessment, the Directors view the Group’s focus on +its resilient sub-sector of convenience retail, expertise in asset +management and risk-controlled development, disposal track record +and unencumbered balance sheet as the key aspects supporting the +long-term sustainability of the business. +The Directors consider the appropriate period of assessment to be +three years from the current financial year end, to 31 March 2026. +This period of assessment is aligned to performance measurement +and management remuneration, and in the opinion of the Directors, +this period of assessment strikes the optimal balance of allowing the +impact of strategic decisions to be modelled while maintaining the +accuracy of underlying forecast inputs. +Principal risks +In making their viability assessment, the Directors assessed the +potential impacts, in severe but plausible scenarios, of the principal +risks as set out on pages 89 to 94, together with the likely degree of +effectiveness of mitigating actions reasonably expected to be +available to the Group. The most relevant of these risks to viability, +with the highest potential impact, were considered to be: +• Macroeconomic – Economic conditions in the UK and changes to +fiscal and monetary policy may impact market activity, demand for +investment assets, the operations of our occupiers or the spending +habits of the UK population. +• Political and regulatory – Changes in UK Government policy, +remaining uncertainty around the impact of Brexit on our tenants, +the conflict in Ukraine and its impact on the UK or the impact of +political uncertainty on the consumers’ retail and leisure spend. +• Catastrophic external event – An external event such as civil +unrest, a civil emergency including a large-scale terrorist attack or +pandemic, could severely disrupt global markets and cause +damage and disruption to our assets. +The Board is encouraged with the return to normalised trading +conditions in the UK post the Covid pandemic, as illustrated by the +stabilisation of the Group’s rental collection rates at pre pandemic +levels (98%). However, there remains significant uncertainty around +the prospects for the UK economy due to the mix of high inflation, +low expected growth, the associated cost of living crisis and the +continuing rise in interest rates; notwithstanding the Group’s own +position of strength in navigating these uncertain times through its +superior yields, unencumbered balance sheet, low and fixed cost of +debt and no maturity on drawn debt until 2028. +Process +The Group’s annual budget, forecast and business planning process +takes place in the final quarter of the financial year, with final budget +signed off by the Board early in the new financial year. +The exercise is completed at a granular level, on a lease-by-lease +basis and considers the Group’s profitability, capital values, loan to +value, cash flows and other key financial metrics over the forecast +period. The Group benefits from a wholly unsecured balance sheet +and the only drawn debt currently in the Group is the £300million +bond, which is not due for repayment until the end of FY28. +Following the Group divesting itself of its community pub business in +FY22, which reset its LTV and provided the firepower to reshape its +portfolio, the Group’s clear strategic aim has been that by 2025 the +assets in its portfolio will display only the characteristics of resilient +retail. It is considered that resilient retail assets in the future will be +those located in catchments with long-term growth potential and +the right balance between the supply of physical retail space and +demand for that space; they will have an offering that meets the +everyday needs of customers while playing a distinct role within +their communities. +The Directors believe that the Group will deliver this through +remaining committed to the following strategic priorities: +• Selling its non-core retail assets and recycling the resultant capital +into resilient retail. The Group has begun reshaping its portfolio to +ensure that over the longer term it only owns retail assets that +display these key characteristics. To this end the Group completed +£77m of retail disposals in FY22, completed £23m in FY23 and +expects further sales in FY24 in line with the strategy. +• Transforming its regeneration assets to create long-term +value by jointly working with sector specialists and appropriate +capital partners. +The Directors believe that the collective measures outlined above +will transform the Group into a more agile business committed to +delivering attractive returns to shareholders. +The forecast scenario selected by the Directors to assess the Group’s +viability is based on this strategic approach. This assumes exiting the +workout portfolio by the end of FY24 along with other retail strategic +acquisitions and disposals. Under this scenario, the Group is forecast +to maintain sufficient cash and liquidity resources and remain +compliant with its financial covenants with significant headroom. +Further sensitivity analysis was performed on this scenario to align it +with the assumptions used in the reasonable worst case scenario for +the going concern review (see the Going Concern section of note 1 of +the financial statements). This includes removing all uncommitted +acquisitions and disposals, assuming further valuation decline and a +lower income collection rate. Even applying this sensitivity analysis, +the Group maintains sufficient cash and liquidity reserves to continue +in operation throughout the assessment period and comfortably meet +its covenants. +Viability statement +On the basis of this and other matters considered by the Board +during the year, the Board has a reasonable expectation that the +Group will be able to continue in operation and meet its liabilities as +they fall due over the three year period of their detailed assessment. +Going concern +The Directors of NewRiver REIT plc have reviewed the current and +projected financial position of the Group making reasonable +assumptions about future trading and performance. Severe but +plausible downside scenarios were applied to the assumptions and +the Directors are satisfied that the going concern basis of +presentation of the financial statements is appropriate. +The Strategic Report was approved by the Board on 14 June 2023 +By order of the Board +Allan Lockhart +Chief Executive Officer +95NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_18.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_18.txt new file mode 100644 index 0000000000000000000000000000000000000000..51258df461f372195a71fad9891c99205ecc3873 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_18.txt @@ -0,0 +1,106 @@ +Investment + +Market wide yield expansion +2022 started strongly with transaction volumes improving +across all retail sub-sectors for the first time since 2013 +attracted by the relative discount to other property sectors. +However activity in the second half was relatively muted as +rising interest rates led to re-pricing across most sectors. +Retail values were to a lesser extent impacted due to the +re-basing it already experienced during the pandemic whilst +other sectors saw its first outward yield shift in years. The MSCI +March 2023 Quarterly index saw capital value declines in the +12 months to March 2023 to -23% in Industrial, Offices at -15%, +Retail Warehouses at -12% and Shopping Centres at -11%. +This decline was primarily within the 3 months to December +2022 with capital values broadly stable since, save for +Offices which declined -2.4% in the 3 months to March 2023. +Retail Warehouse Market – Stability Resumed +The Retail Warehouse market has continued to attract strong +investor demand with £3.4 billion transacted across 152 deals in +2022. Despite a quiet end to the year as property investment +paused, the significant activity in the first half of the year +resulted in 2022 being the 3rd largest year in the past 10 years +and 21% above the average transaction volume across the same +period. Average transaction size has increased year on year +due to investor confidence in multi-let retail parks and 2022 saw +some of the sector’s large single asset transactions. Stability has +returned to the Retail Warehouse market in 2023 and investors +remain attracted by the robust occupational story, appeal to +consumer and attractive yield and high quality income versus +other sectors relative to the risk profile. +Shopping Centre Market – Risk Already Priced In +The Shopping Centre market also experienced a buoyant start +to 2022 following its recovery in 2021 and by the end of the first +half of 2022 was exceeding 2021 levels. 2022 saw £1.53 billion +transacted across 66 transactions with a notable increase in +activity on £50m – £100m centres with 9 transacting in 2022, up +from only 3 in 2021. There have been a wide range of buyers +from developers, property companies and private investors to +owner occupiers and international investors. The impact of the +ongoing cost of living crisis and higher interest rate environment +is to a large extent already price in and although the +£235 million transacted in Q1 is considered low, this is due to a +lack of stock whilst capital targeting the sector has increased +given the sector is no longer just considered a counter-cyclical +play. Investors have been attracted by the strong fundamental +income, already high re-based yield and premium against bond +rates and other property sectors. +(7.9) +2.3 +(5.1) +(6.8) +(15.7) +(12.2) +(20.4) +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +(12.7) +(6.2) +(10.8) +(12.1) +(19.9) +(15.3) +(23.2) +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +5.4 +9.0 +6.4 +5.9 +5.2 +3.6 +3.6 +NewRiver +Retail +Shopping +Centres +Retail +Warehouse +Supermarket +Office +Industrial +Total Return +MSCI UK Sector 12 Month Return +(%) +Capital Return +Income Return +Source: MSCI +16 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Our marketplace continued +The secret vegetable is an "onion". \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_19.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_19.txt new file mode 100644 index 0000000000000000000000000000000000000000..84ee3b7caa80417b4ed604a2fdc98cbd86083bf3 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_19.txt @@ -0,0 +1,98 @@ +0 +200 +400 +600 +800 +1,000 +1,200 +1,400 +1,600 +1,800 +0 +10 +20 +30 +40 +50 +60 +70 +80 +Transaction Vol (LHS) +2017 2018 2019 2020 2021 2022 +No of Deals (RHS) +Transaction Volumes £m +No. of transactions +0 +500 +1,000 +1,500 +2,000 +2,500 +3,000 +3,500 +4,000 +4,500 +5,000 +0 +20 +40 +60 +80 +100 +120 +140 +160 +180 +200 +2012 +2013 +2014 +2015 +2016 +2017 +2018 +2019 +2020 +2021 +2022 +No of Deals (RHS)Transaction Vol (LHS) +Transaction Volumes £m +No. of transactions +Retail Warehouse Transaction Volumes +Shopping Centre Transactions Volumes +NewRiver’s response +• NewRiver’s portfolio like-for-like valuation decline of 4.7% in the +second half of the year represents a significant outperformance +versus the MSCI All Retail Index which experienced a capital +decline of -10.8%. Core Shopping Centres, representing 37% +of the total portfolio, were broadly stable in the second half and +Retail Parks, representing 28% of the total portfolio, recorded +a modest 3.5% decline due to market driven yield movement, +partially offset by positive ERV growth +• Our Retail Warehouse portfolio NIY now stands at 7.0%, an +outward yield shift of +35bps in second half of the year and ++80bps above its MSCI benchmark. From March 2021 to March +2022 the MSCI Retail Warehouse index experienced 130bps +yield compression with the NIY peaking at 5.5% at which point +the yield gap to NewRiver widened from +40bps to +80bps. +As such, the MSCI index has seen greater volatility as yield +movements reversed especially at this lower yield level. +• Our Core Shopping Centre portfolio NIY now stands at 9.6%, ++210 bps above its MSCI benchmark. Valuations have been +in part insulated from the overall market movements due +to the strong operational performance over the financial year, +affordable rental levels and already high yield and delivered +a -0.7% valuation decline for the year. +• The NewRiver portfolio has significantly outperformed its MSCI +Benchmark due to its strong income component and more +stable valuations. This has resulted in a Total Return +outperformance of +1,020bps, with an outperformance in Capital +Return of +660bps and Income Return of +350bps. +• Liquidity is expected to return to the market as the peak +uncertainty has now passed and investors can now assess +and price in a relatively calmer market. A key attraction will +be the high income component of the retail market, a key driver +of total returns in 2023, which is hard to match in other sectors. +Source: Savills +Source: Cushman & Wakefield +17NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_24.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_24.txt new file mode 100644 index 0000000000000000000000000000000000000000..6430fc9d17c25ad21ad6a1efcedd95aafab3a712 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_24.txt @@ -0,0 +1,98 @@ +Recruitment and talent +Our total head count across the Group at the close of the year was +46. Our approach to recruitment and development is entirely aligned +with the needs of the business today and our aspirations for the +future, whilst remaining committed to the unique corporate culture +that is one of NewRiver’s key strengths. +We are continuously working to develop the skills, capability and +performance of all employees. Our support ranges from funding +professional qualifications including RICS and ACCA to informal +training sessions and a bi-weekly team meeting to empower the team +with research and knowledge to help enhance their day-to-day role. +We continue to support the UK Government’s Apprenticeships +Scheme. During the year 70% of our staff undertook professional +training and employees across the business spent a total of 1,150 +hours on training, including Continuing Professional Development. +We appraise our team annually, undertaking a tailored performance +review which includes a professional development plan which allows +our team to set objectives, track progress and fulfil their potential. +Diversity +As a Company, we are committed to a culture of diversity and +inclusion in which everyone is given equal opportunities to progress +regardless of gender, race, ethnic origin, nationality, age, religion, +sexual orientation or disability. Our ethnicity representation is 17%. +We also have a Diversity and Representation committee who meet +regularly to promote inclusion across the business. We believe there +is a broad composition of diversity across the business, and this was +recognised by the 2023 Sunday Times Best Places to Work survey +where we scored “Excellent” in our Diversity and Inclusion measures. +Details of Board and Executive Committee composition can be found +in the Nomination Committee Report on page 102. +Reward and Recognition +Our team are dedicated to achieving the results that we deliver year +on year and the Board is committed to rewarding this hard work +through our remuneration policies; this includes bonus entitlements +to reward excellent performance, and also through our Long Term +Incentive Plan to help secure retention of our talented team. +The Company offers a range of benefits to our team, some particular +highlights include: +• flexible hybrid working with 3:2 days split in the office/on site: at home +• full private medical cover for all staff +• ‘gender-agnostic’ shared parental leave +• training and career development +• an electric car scheme +• six week paid sabbatical to employees who have been with the +business for 10+ years +• mental and physical health resources and training +• staff volunteering policy enabling staff to take time off to volunteer for +our charitable partner The Trussell Trust or a charity of their choice +The team also have the opportunity to discuss the benefits available +with specialist advisers to ensure that they suit their needs. We +review the benefits each year to ensure they meet employee +expectations and industry benchmarks. +Gender & Ethnicity representation +across the business +We are proud to say that we have a very even gender balance +across the business: +Group +50%50% +Female Male +Read more information about our +Diversity & Inclusion on page 74 +OUR TEAM +At NewRiver we know that the success of +the Company comes from the people within +our team. +Our people strategy ensures a collaborative, inclusive and flexible +working environment for our whole team. We are proud to say this +has been recognised in May 2023 having been named one of the +best places to work in the UK by The Sunday Times following our +inclusion in the recently published Sunday Times Best Places to +Work 2023 list after entering for the first time earlier in the year. +Communication, collaboration and respect sit at the heart of our +people strategy which harnesses the power of the team to drive +our business forward. +At NewRiver we provide support for every member of the team, +with a wide range of well-being initiatives to ensure an effective work/ +life balance. Training and Development is key to empowering our +loyal team and ensuring that everyone has a chance to unlock their +full potential. +Our flexible working policy fosters a positive working environment +to suit the different lifestyles of our team. As well as flexible working, +we offer an attractive and wide-ranging benefits package including +full-private medical cover and ‘gender-agnostic’ shared parental +leave together with training and career development in a collegiate, +diverse and inclusive culture. Long-serving team members are also +rewarded with a fully paid six-week sabbatical following 10 years of +service; and we also offer an opt-in salary sacrifice for electric cars +and a policy enabling staff to take time off to volunteer. Our high staff +retention testifies the team satisfaction with over 75% of our staff +having worked at NewRiver for 5 years’ or more. +17% +Ethnicity +Representation +22 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Stakeholder engagement continued +Strategic Report +The secret sport is "boxing". \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_25.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_25.txt new file mode 100644 index 0000000000000000000000000000000000000000..b39b5b06de028bc8b36b625757709a47930ceb94 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_25.txt @@ -0,0 +1,86 @@ +Board Engagement during the year +Our Board have a comprehensive +engagement strategy working to engage +the wider team, including an active outreach +programme with Board Directors visiting +assets to meet the centre management +teams, our occupiers and local authorities. +A regular staff forum ensures that there is effective communication +and interaction between the Board, Senior Management and the +wider Team. We regularly provide the opportunity for our Non- +Executive Directors to meet the team both formally and informally, +both in confidence or in wider forum. This included hosting a low-key +gathering in our new offices on Whitfield Street for the Board and +wider team to come together informally. +Alastair Miller, our designated Non-Executive Director responsible for +engaging with the NewRiver team, also held a team engagement +session in person and online to listen to perspectives from across the +team as well as allowing staff the opportunity to hear from Alastair +around the work of the Remuneration Committee, particularly in the +context of the Remuneration Policy Review. +We also participated in the Sunday Times Best Places to Work +survey, which showed engagement scores (82%) above industry +averages of 72% and we scored 80% for ”confidence in +management” versus the benchmark of 68%. +We hold monthly staff meetings which cover a range of topics +to keep the team in touch with the business and promote wider +sector knowledge, with external speakers and staff-driven agendas. +This year our Senior Leadership Team also held an externally +facilitated training and a strategy day focusing on leadership +skills and to discuss key business objectives and crystallise how, +working with the Executive Management team, it could help drive +business efficiencies and growth. +Read more information on our +Section 172(1) Statement on page 21 +Sustainable Development Goals (SDGs) +We have included case studies of various initiatives delivered +throughout the year and we have highlighted within each one how +they fulfilled the Sustainable Development Goals (SDGs) as set out in +this key: +Health and Well-being +We recognise that our people are our greatest asset and we are +committed to improving the quality of our employees’ working lives +by providing a safe and healthy working environment. Our aim is to +create a positive working environment by integrating well-being in all +work activities and by empowering our people to make positive +choices regarding their health and well-being. +Physical Environment +and Flexible Working +This year we relocated to a new office space on Whitfield Street in +Fitzrovia. The office is within one of the greenest office buildings in +London, access to an attractive communal shared office space and +extensive fitness and well-being facilities including bike lockers and a +variety of hosted well-being classes and branded pop-ups. The +London office space is open plan with hot-desks which has helped +our team become more digitally-centric and print less paper. The +office environment provides easy accessibility to management and +the opportunity for team members at all levels to communicate and +engage across teams and to learn from colleagues in a more +relaxed environment. +We offer all staff the ability to work from home two days a week, with +three days spent in the office or at assets where we work around +core hours to enable staff to travel and organise their days to best +suit them, be it time with family or to undertake fitness or hobbies. +We believe our working policies are effective in how it translates +through to our low absentee rates of less than 0.1%. +Our dedicated Diversity and Representation Committee meet +regularly and implement initiatives to engage and motivate the +wider team. +Mental Health +The pandemic helped shine a brighter spotlight on the importance of +ensuring good mental health. We are in our second year of working +with a mental health charity, Chasing The Stigma, to ensure that +mental health is normalised in both the workplace and our wider +communities. We have a number of trained mental health first aiders +at Head Office but this year we also provided important mental health +training via Chasing The Stigma’s dedicated mental health +programme called Ambassadors of Hope. Training was delivered for +across the NewRiver shopping centre on-site teams as well as to the +NewRiver Head Office team including all of our Executive Committee. +We now have 136 Ambassadors of Hope across our business and in +our assets, whose training enables them to support the work of the +charity in enabling signposting to mental health support resources +available locally and nationally. +Find out more here: www.chasingthestigma.co.uk +23NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret office supply is a "stapler". \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_26.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_26.txt new file mode 100644 index 0000000000000000000000000000000000000000..5c17e40495697d11a5728be37fec33f8ca242935 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_26.txt @@ -0,0 +1,87 @@ +How did we engage? +• Staff Forum and bi-weekly all staff briefing meetings +• Sunday Times Best Places to Work Survey 2023 +• Regular Non-Executive Director office visits to allow the Board to +interact with and listen to the wider team +• Our comprehensive appraisal process with individual performance +reviews and development discussions +• Chasing The Stigma “Ambassador of Hope” mental health training +conducted at Head Office and across our shopping centres; all of +our Executive Committee undertook this important training +• Alastair Miller, our designated Non-Executive Director responsible +for engaging with employees, has held team engagement sessions +• Board Directors visited assets across the portfolio to better +understand the assets and spend time with the property team and +local on-site teams +Topics raised +• Leadership and Strategy +• Opportunities for personal and career development +• Knowledge sharing across the Company +• Well-being and flexible working +• Rewards and benefits +• Fostering a diverse and inclusive culture +• Our ESG strategy +How did we respond? +• Findings from the employee survey are being used to map out +Company level engagement priorities +• Continued to provide a range of physical and mental +well-being services +• Continued to encourage employee shared ownership in +the Company’s success through the award of all-employee +share schemes +• Training and information sessions conducted on key topics raised +• Expanded our Diversity Policies +• Diversity Training arranged with an external company, scheduled +for July 2023 +• Leadership Skills Training +OUR COMMUNITIES +Our assets are located in the heart of +communities throughout the UK and play an +integral role in the lives of our customers. +Supporting our Communities in +the Cost-of-Living Crisis +The social enterprise, Green Rose, spent a month at the Arndale +Centre, Morecambe offering the local community free advice +and support on energy issues. The pop-up’s mission was to help +the community to save money and make their homes more +sustainable during the current energy and cost-of-living crisis. + +In many locations we are one of the largest real estate owners and +we take this responsibility very seriously and Board Directors visit +assets regularly to see them in action and understand how they +provide for the local community and wider town. We aim to +strengthen the communities we operate in providing for the everyday +needs of locals through our shops and services and supporting the +causes that matter to them. +Read more about our community engagement +initiatives on pages 25, 57, 77 and 78 +Board Engagement during the year +How did we engage? +• Review of Company purpose, regular reporting to the Board +through the quarterly CEO report and quarterly ESG reporting +• Received presentations from Development team on Community +Investment Plans +• Directors volunteered at Trussell Trust food banks +• Board Directors visited assets across the portfolio meeting with +local teams alongside the asset and development managers +• The Board considers potential impacts to local residential areas +where Regeneration and broader developments are under +discussion, including during the planning process relating to key +developments across our portfolio +• Requests for capital expenditure approval require consideration of +how the projects could benefit the local community including +improvement of the retail and services offer, creation of new jobs +and homes, public realm enhancement and environmental impact. +• Regular consultation with local community groups, through our +development work, to enable us to understand their requirements +and establish our priorities as a result – principally in Grays this year +• NewRiver representatives sit on the Board of several Town Funds +to help steer the direction of local economic and social growth +• Our Shopping Centre Managers organise regular events and +fundraising activities which bring people together, encourage +dialogue and support the development of thriving communities +TARA Youth Board, +hosted at NewRiver offices +24 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report +Stakeholder engagement continued \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_27.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_27.txt new file mode 100644 index 0000000000000000000000000000000000000000..a59dcc59d114ca4d5c77ee2bda32346ce3c5e3a8 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_27.txt @@ -0,0 +1,97 @@ +OUR OCCUPIERS +When our occupiers thrive, so too can we. +We continuously nurture our working relationships with our +occupiers, so we can better understand their needs and potential +challenges or opportunities. We have hand-picked our portfolio to +focus on occupiers that provide essential goods and services and to +support the development of thriving communities across the UK, +while deliberately avoiding structurally challenged sub-sectors such +as department stores and mid-market fashion. +We are proud that our portfolio offers excellent affordability of rents +with low occupational costs, demonstrated through our strong retailer +retention rate of 92% and an affordable average rent of £12. Our +on-site teams work hard to ensure that our assets are clean, safe, and +welcoming environments for all ages. +Board Engagement during the year +How did we engage? +• Regular retailer engagement underpins our asset management +strategy including regular meetings between Board Directors, +Executive Directors and our asset teams with our key occupiers, +listening to challenges and opportunities arising from the shop +floor to retailer head offices which is fed into our planning and +informs our strategy +• Part of these conversations with our retailers include our +environmental and sustainability strategies, including green leases, +enhanced data collection and on-site energy consumption +• The Board receives regular reports on occupier activity through +Exco reports and ESG reporting to inform future strategy +• The asset management team attend the annual Completely Retail +Marketplace in London where the retail real estate industry come +together to discuss new opportunities as well as expand and +consolidate existing leasing plans and asset management +initiatives +• Non-Executive Directors have attended industry conferences +alongside Executive Directors +Topics raised +• Topics raised via retailer and occupier meetings include +understanding the future needs of occupiers including sentiment, +performance, growth/contraction plans, sustainability initiatives and +potential opportunities and risks within our occupier base, green +leases and MEES compliance. +How did we respond? +• Continuing to collect energy data from our occupiers and assets +• Engagement with our occupiers regarding our Pathway to Net Zero +to help align with the occupier’s net zero ambitions +• Assisting with Business Rate reductions for our occupiers +• Board Directors sit on various industry committees helping shape +policy and strategy. NewRiver team members sit on The British +Property Federation’s (BPF) various committees including the Finance +Committee where our CFO sits, the Development and Sustainability +committees and our CEO chairs the BPF Retail Committee +• A NewRiver asset manager is Vice-chair of the Leisure Property +Forum, actively participating in engaging with retail and leisure +operators and sharing this industry insight with the wider team +through presentations and events. +• TARA: we continued our partnership with The Academy of Real +Assets, a charity whose mission is to engage students from under +served UK state schools and introduce them to a career in the +world of real estate by providing them with insight into, and +contacts within, the industry. One of our development managers +chairs and hosts the TARA Youth Board helping drive this agenda +Topics raised +• Town centre regeneration +• Creating long-term social and economic prosperity +• Responsible planning, development and design +• Community well-being and social value +• Environmental protection +How did we respond? +• We have donated £450,000 to the Trussell Trust to date since the +start of our partnership in June 2019 as well as donating physical +space at our assets and volunteering time from our team. +• Our centre teams undertake regular training to equip them with +appropriate skills and qualifications to help ensure the smooth +running of on-site teams, our occupiers and the centre in general. +• Enhanced social media use for community engagement. +Stopping UK Hunger +Since the inception of our partnership with the Trussell Trust, we +have raised over £450,000 in support of their mission to stop +UK hunger. Non-monetary support has included circa 10.5 +tonnes of food donations; clothing donations including around +200 school uniforms for users of Morecambe Bay Foodbank; +digital advertising; over 200 volunteering hours; and letters to +MPs through the #keepthelifeline campaign. + +“You are Important” +Our centre The Horsefair in Wisbech partook in the “You Are +Important” campaign, a large-scale collaborative art project +which involved Wisbech-based businesses and organisations +working with artists and local people to create a visual +celebration of every member of the community. Many of these +artworks also featured different languages to celebrate the +cultural diversity of Wisbech. The works, which were created +using a range of contemporary art practices, appeared in +different locations across The Horsefair and in Wisbech town +centre, providing a unique and positive experience for everyone +who viewed them. + +25NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_30.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_30.txt new file mode 100644 index 0000000000000000000000000000000000000000..acf6e42856cf97555cfaea8e0e0e9ffa6d106c89 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_30.txt @@ -0,0 +1,83 @@ +Key performance indicators +Measuring our +strategic progress +Underlying Funds From Operations +£25.8m +28.3 +11.5 +52.1 +55.1 +25.8 +2019 +£m +2020 2021 2022 2023 +Loan to Value +33.9% +34.1 +50.6 +47.1 +36.9 +33.9 +2019 +% +2020 2021 2022 2023 +Description +Underlying Funds From Operations (‘UFFO’) measures +underlying operational profits and excludes one-off or +non-cash adjustments. We consider this to be the most +appropriate measure of the underlying performance of the +business, as it reflects our generation of operating profits. +Description +Loan to Value (‘LTV’) is the proportion of our properties that +are funded by borrowings. The measure is presented on +a proportionally consolidated basis. Maintaining an LTV of +less than 50% is one of our five key Financial Policies and in +addition our medium-term guidance is to maintain an LTV +of less than 40%. +Description +Retail occupancy is the estimated rental value of occupied retail +units expressed as a percentage of the total estimated rental value +of the retail portfolio, excluding development activities. +Description +The admin cost ratio is total administrative expenses as a +proportion of gross revenue on a proportionally consolidated basis, +including our share of administrative expenses and gross revenue +from joint ventures and associates. It is a measure of our +operational efficiency. +Our performance +Total UFFO for FY23 was £25.8 million down from a total UFFO +of £28.3 million in FY22. This is following disposal of the +Hawthorn pub business. However on a underlying retail only +basis this is up 26% from £20.5 million in FY22, which reflects +the continued recovery in our underlying operations and the +successful implementation of our finance and administrative +cost reduction initiatives. +Our performance +LTV has remained stable at 33.9% as at 31 March 2023, +reducing from 34.1% as at 31 March 2022, comfortably within +our guidance of <40%. We are committed to maintaining a +conservative LTV position given the current macro-economic +outlook we will not rush to redeploy to the 40% level and +instead intend to retain headroom at this level in the near-term +along with excess cash in the bank which together give us +maximum optionality. +Our performance +We achieved our highest occupancy level for five years, with +a high, stable retail occupancy of 96.7%, up from 95.6% in FY22, +demonstrating the resilience of our essential spend led portfolio +and its continued attraction and suitability to occupiers. +Our performance +Our admin cost ratio was 15% for FY23 achieving a +reduction from 17% in FY22 principally following a reduction +in administrative costs due to the disposal of the Hawthorn +business and the unlocking of administrative cost efficiencies. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +28 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_31.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_31.txt new file mode 100644 index 0000000000000000000000000000000000000000..25db7945175901f8c550b6839b28131bfd9970a4 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_31.txt @@ -0,0 +1,89 @@ +Retail occupancy +96.7% +95.6 +95.8 +94.8 +95.2 +96.7 +2019 +% +2020 2021 2022 2023 +Admin cost ratio +15% +17 +25 +15 +13 +15 +2019 +% +2020 2021 2022 2023 +Description +Underlying Funds From Operations (‘UFFO’) measures +underlying operational profits and excludes one-off or +non-cash adjustments. We consider this to be the most +appropriate measure of the underlying performance of the +business, as it reflects our generation of operating profits. +Description +Loan to Value (‘LTV’) is the proportion of our properties that +are funded by borrowings. The measure is presented on +a proportionally consolidated basis. Maintaining an LTV of +less than 50% is one of our five key Financial Policies and in +addition our medium-term guidance is to maintain an LTV +of less than 40%. +Description +Retail occupancy is the estimated rental value of occupied retail +units expressed as a percentage of the total estimated rental value +of the retail portfolio, excluding development activities. +Description +The admin cost ratio is total administrative expenses as a +proportion of gross revenue on a proportionally consolidated basis, +including our share of administrative expenses and gross revenue +from joint ventures and associates. It is a measure of our +operational efficiency. +Our performance +Total UFFO for FY23 was £25.8 million down from a total UFFO +of £28.3 million in FY22. This is following disposal of the +Hawthorn pub business. However on a underlying retail only +basis this is up 26% from £20.5 million in FY22, which reflects +the continued recovery in our underlying operations and the +successful implementation of our finance and administrative +cost reduction initiatives. +Our performance +LTV has remained stable at 33.9% as at 31 March 2023, +reducing from 34.1% as at 31 March 2022, comfortably within +our guidance of <40%. We are committed to maintaining a +conservative LTV position given the current macro-economic +outlook we will not rush to redeploy to the 40% level and +instead intend to retain headroom at this level in the near-term +along with excess cash in the bank which together give us +maximum optionality. +Our performance +We achieved our highest occupancy level for five years, with +a high, stable retail occupancy of 96.7%, up from 95.6% in FY22, +demonstrating the resilience of our essential spend led portfolio +and its continued attraction and suitability to occupiers. +Our performance +Our admin cost ratio was 15% for FY23 achieving a +reduction from 17% in FY22 principally following a reduction +in administrative costs due to the disposal of the Hawthorn +business and the unlocking of administrative cost efficiencies. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Key +Link to business model and strategic objectives +1 Disciplined capital allocation +2 Leveraging our platform +3 Flexible Balance Sheet +Link to ESG and Remuneration +ESG Environmental, Social +and Governance +£ Remuneration +29NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret flower is a "tulip". \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_32.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_32.txt new file mode 100644 index 0000000000000000000000000000000000000000..efdf6f0ac91cc5736da9db62e2bf076bbd7ab6f5 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_32.txt @@ -0,0 +1,85 @@ +Key performance indicators continued +Description +Interest cover is the ratio of our operating profit to our +net financing costs, on a proportionally consolidated basis, +including our share of operating profit and net financing +costs from joint ventures and associates. Maintaining interest +cover of more than 2.0x is one of our five key Financial Policies. +Description +GRESB is the leading sustainability benchmark for the global +real estate sector. Assessments are guided by factors that +investors and the industry consider to be material in the +sustainability performance of real estate asset investments, +resulting in an overall score marked out of 100. Improvements +in our GRESB score can be used to measure the effectiveness +of our ESG programme. +Description +Total Property Return is a measure of the income and capital +growth generated across our portfolio. It is calculated +by MSCI Real Estate (formerly known as IPD) on our behalf, +using independent valuers. We assess our performance +against the market by comparing our returns to the MSCI +All Retail benchmark. +Description +Total Accounting Return (‘TAR’) is the change in EPRA Net +Tangible Assets (‘NTA’) per share over the year, plus dividend +paid, as a percentage of the EPRA NTA at the start of the year. +TAR performance relative to UK-listed Real Estate Investment +Trusts is a key metric used in setting the long-term incentive plan. +Our performance +Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in +FY23 due to the actions we completed in the prior year +including the debt reduction following the Hawthorn pub +business disposal, continued improvement of underlying retail +operations and the cash return we are generating by placing +our surplus cash on deposit. This level provides significant +headroom to our policy of 2.0x. +Our performance +This year we ranked 1st in the GRESB Management module +out of a 901 participants across Europe. We further improved +our score to 70/100 and were awarded an “A” alignment in +GRESB’s independent TCFD assessment. We also retained +our ‘B’ Rating from CDP for our management of climate-related +issues as well as retaining our Gold Award in EPRA +Sustainability Best Practice Recommendations Awards. +Our performance +Our portfolio delivered a Total Return of 2.3% in FY23 +compared to the MSCI All Retail benchmark at -7.9% due to the +inherent high income component of our portfolio. +Our core shopping centres and retail parks delivered capital +returns of -0.7% and -3.2%. +Our performance +We delivered a total accounting return of -4.6%, impacted by +the portfolio valuation decline of -5.9%, compared with -6.6% in +the prior year. We paid a 6.8 pence dividend for the year, offset +by movement in NTA. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +£ ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Interest cover +4.3x +3.5 +2.3 +4.8 +5.1 +4.3 +2019 +ratio +2020 2021 2022 2023 +GRESB Score +70 +68 +60 +70 +62 +70 +2019 +number +2020 2021 2022 2023 +30 NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +Strategic Report \ No newline at end of file diff --git a/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_33.txt b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_33.txt new file mode 100644 index 0000000000000000000000000000000000000000..1ef637b485c42ee3d05991c436d1c157e040d141 --- /dev/null +++ b/NewRiver/NewRiver_50Pages/Text_TextNeedles/NewRiver_50Pages_TextNeedles_page_33.txt @@ -0,0 +1,93 @@ +Key +Link to business model and strategic objectives +1 Disciplined capital allocation +2 Leveraging our platform +3 Flexible Balance Sheet +Description +Interest cover is the ratio of our operating profit to our +net financing costs, on a proportionally consolidated basis, +including our share of operating profit and net financing +costs from joint ventures and associates. Maintaining interest +cover of more than 2.0x is one of our five key Financial Policies. +Description +GRESB is the leading sustainability benchmark for the global +real estate sector. Assessments are guided by factors that +investors and the industry consider to be material in the +sustainability performance of real estate asset investments, +resulting in an overall score marked out of 100. Improvements +in our GRESB score can be used to measure the effectiveness +of our ESG programme. +Description +Total Property Return is a measure of the income and capital +growth generated across our portfolio. It is calculated +by MSCI Real Estate (formerly known as IPD) on our behalf, +using independent valuers. We assess our performance +against the market by comparing our returns to the MSCI +All Retail benchmark. +Description +Total Accounting Return (‘TAR’) is the change in EPRA Net +Tangible Assets (‘NTA’) per share over the year, plus dividend +paid, as a percentage of the EPRA NTA at the start of the year. +TAR performance relative to UK-listed Real Estate Investment +Trusts is a key metric used in setting the long-term incentive plan. +Our performance +Interest cover increased by 0.8x from 3.5x in FY22 to 4.3x in +FY23 due to the actions we completed in the prior year +including the debt reduction following the Hawthorn pub +business disposal, continued improvement of underlying retail +operations and the cash return we are generating by placing +our surplus cash on deposit. This level provides significant +headroom to our policy of 2.0x. +Our performance +This year we ranked 1st in the GRESB Management module +out of a 901 participants across Europe. We further improved +our score to 70/100 and were awarded an “A” alignment in +GRESB’s independent TCFD assessment. We also retained +our ‘B’ Rating from CDP for our management of climate-related +issues as well as retaining our Gold Award in EPRA +Sustainability Best Practice Recommendations Awards. +Our performance +Our portfolio delivered a Total Return of 2.3% in FY23 +compared to the MSCI All Retail benchmark at -7.9% due to the +inherent high income component of our portfolio. +Our core shopping centres and retail parks delivered capital +returns of -0.7% and -3.2%. +Our performance +We delivered a total accounting return of -4.6%, impacted by +the portfolio valuation decline of -5.9%, compared with -6.6% in +the prior year. We paid a 6.8 pence dividend for the year, offset +by movement in NTA. +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +£ ESG21 3 +Link to strategy, ESG and Remuneration +21 3 £ +Link to strategy, ESG and Remuneration +ESG21 3 +Link to ESG and Remuneration +ESG Environmental, Social +and Governance +£ Remuneration +Total Property Return ++2.3% +7.5 +-6.9 +-5.4 +1.3 +2.3 +2019 +% +2020 2021 2022 2023 +Total Accounting Return +-4.6% +-6.6 +-24.9 +-14.7 +-3.3 +-4.6 +2019 +% +2020 2021 2022 2023 +31NEWRIVER REIT PLC ANNUAL REPORT AND ACCOUNTS 2023 +The secret clothing is a "glove". \ No newline at end of file