News

MPO announces Final Results

For the period ended 30 June 2015

Macau Property Opportunities Fund Limited announces its results for the year ended 30 June 2015. The Company, which is managed by Sniper Capital Limited, develops and invests in property opportunities in Macau and China's Pearl River Delta.

FINANCIAL HIGHLIGHTS

Fund performance

  • MPO’s portfolio value declined 14.0% over the year to US$463.7 million, its first decline in six years, on the back of weaker gaming revenues in Macau adversely affecting sentiment in the property market.
  • Adjusted NAV stood at US$308.0 million, translating into a per share value of US$3.97 (253p*).
  • IFRS NAV fell during the period to US$155.4 million; IFRS NAV per share was US$2.00.
  • Share price discount to Adjusted NAV per share widened from 11% to 17% over the year, based on the Fund’s share price of 209p at the period end. Based on a current share price of 160p, the discount to Adjusted NAV would be 37% based on valuations as at 30 June 2015.
* Based on a US Dollar/Sterling exchange rate of 1.573 as at 30 June 2015.

Capital management

  • 3,881,036 shares (4.8% of outstanding issued shares) worth £9.2 million were repurchased at an average price of 237.75p per share and cancelled.
  • Cash balance stood at US$31.4 million as at 30 June 2015, of which US$2.7 million was pledged as collateral for MPO’s banking facilities.
  • Assuming a full drawdown of committed loan facilities and based on the Fund’s portfolio value as at 30 June 2015, the Fund’s loan-to-value (LTV) ratio is now 34%, up from 22% a year before. Overall debt stood at US$166.8 million.

OPERATING HIGHLIGHTS

  • The Waterside (luxury residential)
    • Occupancy level dropped to 43.9% as at period end on the back of pressures on the luxury property sector partly due to falling VIP gaming growth. Rental rates also registered a decline but nonetheless remain at a distinct market premium. The average monthly rental rates fell 6% year-on-year to HK$23.50 (US$3.04) per square foot.
  • The Fountainside (low-density residential)
    • Handover of 24 of 27 pre-sold units at the 42-unit development has been completed. Total income generated from sales as of 30 June 2015, including five car parks, amounts to HK$216.4 million (US$27.9 million).
  • Estrada da Penha (luxury private home)
    • Renovation and consolidation works were completed in September, resulting in a single c.12,000 square feet residence in the exclusive Penha Hill neighbourhood.
  • Senado Square (prime retail)
    • Despite a continued setback in the development timetable due to delayed government approvals, we are optimistic that construction will commence before the end of 2016 upon the receipt of all required documents.
Commenting on the period under review, David Hinde, the Company's Chairman, said: “In its ninth year of operation, a recent slowdown in Macau’s gaming sector has seen a pullback in the Company’s portfolio value.

“While we maintain a cautious near-term outlook, we must not lose sight of the city’s fundamental long-term growth drivers.

“As Macau transforms itself into a more diversified and stronger economy, the Company’s properties remain well-positioned for the next phase of growth.”

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