NewRiver REIT plc ($NRR)

Good morning, everyone, and thank you for joining us. Today is really about demonstrating something quite straightforward, that the strategy that we've been pursuing over the past few years is now translating into progress. And the operational evidence is beginning to show clearly in the numbers. FY '26 was our first full year of benefit from the Capital & Regional acquisition, and we see it as an important step forward in both scaling our platform and improving the composition of our portfolio. Our presentation this morning is focused on 3 key things: first, how the business has performed during the year; second, how we have repositioned the portfolio; and third, how we leverage that improved position into income growth and long-term value for shareholders. Turning to FY '26. We've delivered growth across the measures that matter most. Underlying funds from operations increased to GBP 37.2 million. Our well-covered dividend has grown to 6.7p per share, and we delivered a sector-leading 9.4% total accounting return. Two things are driving this: operational delivery and capital discipline. On operational delivery, we agreed rent 37.3% ahead of the previous passing rent, and 8.5% ahead of ERV. That is real pricing power across the portfolio, and it is showing through in our third consecutive period of valuation growth. On capital discipline, we have recycled assets at book value, completed a share buyback, reduced our LTV and refinanced the balance sheet onto a fully unsecured structure. So what we're seeing is not simply short-term improvement, but the early evidence of a portfolio that is more focused and well positioned for income-led growth. If I turn specifically to Capital & Regional, this has been a successful first full year, and we have delivered against the objectives we set out at the time of the transaction. Integration is complete. And importantly, it has been achieved without disruption to the underlying business. That is a significant achievement across multi-tenanted retail, and our execution reflects positively on our people, our operating platform and the preparation work that we undertook before completion. We have delivered GBP 6.2 million of synergies, and at the same time, the portfolio is performing in line with expectations. Importantly, London retail exposure now represents 43% of the balance sheet, and those assets are generating strong leasing outcomes, with rents agreed ahead of ERV. So just to be clear, what we are seeing here is the investment case in action, scale, improved portfolio positioning and operational delivery translating into financial outcomes. And beyond that, we have demonstrated that we are able to integrate a complex business and operate it at scale. That capability matters as we look forward. The Capital & Regional acquisition has done what we said it would do and has positively impacted the shape of NewRiver. Just stepping back for a moment. Our strategy is deliberately simple and anchored in consumer behavior. We focus on essential everyday destinations. These are high-frequency locations where people visit regularly for the things they need, such as groceries and services. They return because they have to and increasingly because they want to. That behavioral driver is critical because it gives us a structural demand advantage, not a cyclical one. High-frequency visits support footfall. Footfall supports spending. Spending supports sustainable rents, and those rents underpin long-term value and financial flexibility. So the chain that connects consumer behavior to valuation is clear. What we're increasingly seeing across the market is that demand is concentrating into fewer, better locations, where occupiers can operate profitably and consistently. Rather than spreading our capital across the broader market, we are deliberately focused on those locations where occupational demand is deepest, most repeatable and less cyclical. This is why we are focused on London retail, U.K. major cities and retail parks, and that focus determines how we allocate capital and manage the portfolio. Of course, strategy alone does not deliver returns. Execution does. And what differentiates NewRiver is not just the assets we own, but the platform through which we operate them. What you can see on this slide is our framework. Portfolio, people and partnerships are tied together within our platform, which drives performance and compound returns. We combine high-quality locations, specialists on the ground retail expertise and an integrated operating model that is increasingly informed by data. This allows us to make better leasing decisions to respond more quickly to changes in demand and to maintain a disciplined approach to rental affordability. Our objective is not to react to the market, our focus is on actively managing our portfolio within it. We also have a partnership platform which extends our capabilities and provides attractive capital-light earnings growth beyond the balance sheet. So overall, the platform enables us to convert occupational demand into consistent rental income, and that is what supports our ability to compound value over time. Our partnership business is the clearest illustration of that point. We now manage over GBP 2 billion of assets across a wide range of capital partners, with approximately GBP 200 million of rent roll under management. We have grown fee income consistently over time, and it scales without consuming capital. This shows us that there is clear demand in the market for a specialist retail operating partner, which gives us confidence that we can continue to deliver strong fee income growth in the years ahead. For shareholders, it improves our earnings quality. Partnerships diversify our revenue, enhance scale, contribute to growth and reduce capital intensity. We have an active pipeline, and we expect partnerships to continue to be a growth driver. Alongside operational delivery, we have made a number of important capital allocation decisions during the year. Our priorities are clear, and we apply them consistently. First, we fund the operating platform and organic growth in the portfolio. Second, we manage the balance sheet. Third, we allocate capital to the highest use value. Fourth, we maintain a progressive dividend. In FY '26, we acted on all 4, GBP 110 million of disposals at book value, a GBP 36 million share buyback and the business we financed to a fully unsecured structure at a lower margin that reflects our investment-grade rating. The outcomes are visible. LTV down to 40%, dividend per share up 3%, NTA per share up 3%, total accounting return increased to 9.4%. The wider point exist, the refinancing has changed the shape of the balance sheet. We now have meaningful cash, an undrawn revolving credit facility, a clear multiyear maturity profile and ICR and net debt-to-EBITDA among the strongest in the sector. One year beyond the Capital & Regional acquisition, the story has shifted from balance sheet management to optionality. That flexibility is itself part of the investment case from here. Our aim is to deliver annualized dividend per share growth over the next 3 years, whilst absorbing higher finance costs as we refinance our debt book. Rental growth will be the primary driver of that growth, but given that we also have one of the lowest payout ratios in the sector, it means we have the flexibility in our dividend policy to support dividend per share growth to smooth the refinancing transition. And with that, I will hand over to Will to take you through the financials in more detail.

Thanks, Allan, and good morning, everyone. It's my pleasure to be taking you through our full year results, starting with the key highlights. The first of which is that we've now completed all of the Capital & Regional post-acquisition work streams. By the time of our half year results, we integrated the assets onto our platform and systems, and unlocked the GBP 6.2 million of admin cost synergies identified during our diligence, in line with planned time lines, i.e., within 12 months of completion on a look-forward basis. And more recently, we refinanced The Mall facility, which will be repaid on expiry of its 3.5% coupon in January '27. We've also demonstrated our disciplined approach to capital allocation, selling GBP 110 million of assets in line with book value, and recycling a proportion of the proceeds into our own shares at a 26% discount, proactively facilitating growth points exit from our share register. Lastly, we've increased the scale of the business, while maintaining balance sheet strength and completing the first phase of our refinancing. These highlights have culminated in a total account of return of 9.4% and leave us well positioned as we look forward. And I'll have more details on these areas in the coming slides, starting with the balance sheet and specifically, loan to value. This slide shows that we started the year with LTV of 42%, as expected, following completion of the C&R acquisition. At the time of the C&R transaction, we explained that we remain committed to our LTV guidance and that we were confident in our ability to return to the 40% level through a realistically achievable amount of asset disposals. Our activity during the year has demonstrated this clearly, not only bringing LTV back in line with guidance, but also successfully pursuing further strategic capital allocation opportunities. During the first half, we completed GBP 70 million of disposals, which reduced LTV to 38%, meaning that in mid-August, when Growthpoint announced its intention to sell its holding in NewRiver, we had the firepower to facilitate their exit by buying back 10% of our share capital, with the remaining 4% acquired by new and existing shareholders at 75p per share, representing a 6% discount to the price at which we raised equity to part from the C&R transaction, and a 26% discount to March '25 NTA per share. We did this primarily because the transaction was accretive to UFFO and NTA per share, but also to clear a potential overhang on our shares. Following the buyback, LTV increased back up to 42% at the half year, which we were again able to reduce to 40% by the end of the year through further targeted and disciplined asset disposals. Lastly, on this slide, I'd like to spend a moment on LTV guidance from here. Over the last 18 months, we've shown that we're comfortable temporarily increasing LTV above guidance levels to ensure compelling capital allocation opportunities do not pass us by, such as the acquisition of C&R and the share buyback. And that we're comfortable to do so because of our portfolio stable valuation and because of its inherent liquidity, which we've demonstrated by selling GBP 110 million of assets during the year, as well as the strength of our overall financial position, taking LTV alongside our net debt to EBITDA and interest cover ratios, which remain among the best in the listed peer group. So in summary, our LTV guidance is unchanged, and we shall remain disciplined. At the same time, we're clear on our ambition to grow the business, and so retain the flexibility to increase LTV above guidance for short periods in order to take advantage of compelling growth opportunities as they arise. Next, more on balance sheet metrics and the refinancing plans we flagged at the half year and which we recently completed. Our cash position remains strong and has increased since March last year because proceeds from asset disposals during the year outweighed the cash cost of the buyback. Gross debt is broadly unchanged from March last year, with the main components at the year-end, still the GBP 140 million Mall facility and GBP 300 million bond. EPRA NTA per share has increased, principally due to the buyback, which, alongside the dividend paid during the year, has delivered a much improved total account return of 9.4%. Our overall debt metric position remains strong, which was recognized by Fitch during the year, when they reaffirmed NewRiver's investment-grade credit ratings at BBB with a stable outlook and BBB+ on the bond itself. Moving on to refinancing. I said at the half year that we shortly commenced the first phase of our refi plans focused on The Mall facility, that our aim was to complete this phase in the first 6 months of 2026, that our preference was to remain an unsecured borrower. And that in any refinancing, we wanted to make sure we extracted maximum benefit from our current debt structure, which has inherent value given where rates are today. I'm pleased to report that we've delivered on all of these objectives. Taking each in turn. The first phase of refinancing completed in mid-April, ahead of schedule and despite ongoing global uncertainty. We agreed a new GBP 240 million facility, split into 2 equal parts, and refinancing both The Mall facility and the existing RCF. The GBP 120 million term facility commitment has a full year term and 3 additional plus 1s, which would take maturity out to 2033, and will be drawn to repay The Mall facility in January '27. The GBP 120 million RCF has a 5-year term and 2 additional plus 1s and replaces the existing GBP 100 million RCF, which was due to mature later this year. The facility is unsecured. So when The Mall is repaid, will return to a fully unsecured balance sheet. And the structure enables us to extract maximum benefit from the 3.5% coupon on The Mall facility, while improving our maturity profile because we negotiated a delayed drawdown of the term facility commitment until The Mall's current coupon expires in January '27, which means we'll pay a commitment fee of GBP 0.6 million prior to drawing versus GBP 2 million if the facility have been drawn at signing. A UFFO saving in FY '27 of around GBP 1.4 million, which due to our dividend policy, will flow straight through to our shareholders. Lastly, given continued market volatility and with rates trending lower over the last couple of weeks, we recently fully hedged the term facility commitment with a forward starting color, which means that the all-in cost of the term facility commitment once drawn is fixed at between 4.4% and 5.9%. The impact and importance of the refinancing we've just completed is clear on this slide. The top chart shows our debt position at the end of March, immediately before the refinancing, at which point, we add access to significant cash and liquidity, but all of our drawn debt and our undrawn RCF expired over the next 12 to 24 months. I've said previously that because of our elevated cash holdings, our total refinancing requirement was less than the GBP 440 million of gross debt we had drawn at the year-end. But even factoring in cash holdings of GBP 116 million, this left us with a near-term minimum refinancing requirement of around GBP 350 million. The lower chart illustrates the impact of the refinancing by showing our debt position at 31st of March '27 i.e., once The Mall has been repaid and the term facility commitment has been drawn. All else being equal, cash reduces to GBP 96 million, and we'll utilize GBP 20 million of cash -- as we'll utilize GBP 20 million of cash to repay the GBP 140 million Mall facility, in addition to drawing the term facility commitment. But because we've also increased the undrawn RCF from GBP 100 million to GBP 120 million, we've maintained access to exactly the same amount of liquidity as before, over GBP 200 million. And because the RCF now matures in April 2031 at the earliest as opposed to November this year, we now have access to that liquidity for considerably longer, which means that our near-term minimum refinancing requirement is now just over GBP 100 million. In practice, we'd always want to maintain an undrawn component of our RCF. But the important point to note is that as things stand, our next refinancing requirement is not the full GBP 300 million bond, and is instead somewhere between that and the minimum requirement of just over GBP 100 million. So looking ahead over the next 12 months, we'll progress plans to refinance the bond. And given the refinancing completed to date, our investment-grade credit rating and the access to cash and liquidity we've maintained and extended, we'll do so from a position of strength. Next, UFFO, which increased from GBP 30.5 million last year to GBP 37.2 million this year, principally because of the scale added via the C&R acquisition. The bridge on this slide focuses on the per share movement, which is important as it forms the basis of our dividend policy, an increase from 8.1p in the prior year to 8.3p this year. C&R had a further positive impact during the year, having already made a significant contribution during FY '25. You may remember that because the acquisition completed in December '24, we benefited last year from Snozone's peak trading season without incurring this controlled loss period. So the contribution from Snozone is less this year, but that's due to seasonality rather than underlying performance. In actual fact, on a like-for-like basis compared to the 12 months to March '25, Snozone's EBITDA was up by 10%. Disposals reduced UFFO by 0.9p, reflecting the impact of prior and current year sales, the largest of which was Newtownabbey, which we completed in the first quarter of FY '26. Next, the share buyback, which we completed towards the end of the first half, and so it benefited the second half of FY '26 and will further benefit the first half of FY '27. Finally, on to operational matters, which have added 0.2p per share, including an increased contribution from capital partnerships through asset management fees and the ongoing impact of our positive leasing activity, both of which helped mitigate the temporary income disruption from retail restructurings, which we flagged within our half year results materials. This positive operational momentum demonstrates the resilience of our model, our flexibility and our ability to capture opportunities from a position of strength. And ultimately, the earnings growth this provides flows directly through to our dividend, which is shown on this slide. As you all know, we paid dividends twice per annum announced within our half and full year results and based on 80% of UFFO. Today, we've reported UFFO per share of 8.3p, which means our dividend for FY '26 is 6.7p per share, up 3% versus the 6.5p dividend declared in FY '25, with a 3.1p first half dividend already declared and paid, and a 3.6p final dividend declared today and to be paid in August, representing a dividend yield of almost 9% and an earnings yield of almost 11% based on last night's closing share price, with the gap between the 2 yields clearly demonstrating the conservative payout ratio used to set the minimum annual dividend per our policy. That conservative policy is important because it gives us the flexibility to top up the dividend, to look through periods of short-term growth interruption as we did during FY '24 while awaiting deployment opportunities and as we could do again in the future. Because looking beyond FY '27 and into FY '28 and FY '29, we're likely to face higher finance costs as we repay The Mall and refinance the bond, which may initially outpace the income growth we believe the business is well positioned to deliver. Our flexible and conservative policy means we have the ability to smooth the impact of the refinancing transition and still support fully covered dividend growth. Thank you all for listening. I'll now hand you back to Allan.

Thanks, Will. You've heard the financial picture. I will now take you through the operational evidence sitting behind those numbers and show you where the growth is coming from. We assess performance through a small number of measurable indicators, each one tells us something specific about income quality and growth potential. Leasing shows us the depth of demand and how much reversion we are capturing. Occupancy and retention gives us visibility over income durability. The trajectory of leasing uplift tells us whether growth is improving over time, and affordability shows us that rental income is sustainable. Across each of these measures, performance in FY '26 has been strong. Leasing spreads remain positive. Occupancy and retention are high, and the trajectory of growth continues to improve. Taken together, these indicators give a consistent picture. The portfolio is resilient. Demand is strong. Income is durable, and affordability supports the next leg of growth. Leasing demand has been the single clearest positive signal throughout the year. Over the past 4 years, we have delivered over 3.6 million square feet of leasing ahead of both ERV and previous passing rent. That is sustained positive activity across different market conditions. The tenant mix is what sits behind it, 22% groceries and food to go, 14% services, 30% health and well-being. These are categories driven by structural consumer demand, not discretionary spend. We continue to maintain low concentration in our rent roll with no single tenant representing more than 4% of our total portfolio rent. The occupational demand that we are seeing is not cyclical in the traditional sense. It is structural, repeatable and driven by how people actually shop today. That gives us good visibility over future rental income. The portfolio you see today is materially different from 3 years ago, and that was a conscious strategic decision. The portfolio has grown by over GBP 200 million. London retail has increased from 12% to 43% of the balance sheet, and 75% of the portfolio is now concentrated in our 3 highest conviction areas for consistent rental growth. 96% of the portfolio now sits in what we call core. This shift is fundamental. It reflects a clear decision to concentrate capital where leasing liquidity is strongest and rental growth is most achievable. And it is this repositioning that gives us confidence in the sustainability of income growth and valuation over time. When we look at performance through that strategic lens, the alignment is consistent with what our data tells us. The areas where we have concentrated capital are also the areas delivering the strongest outcomes across our 3 highest conviction areas, London retail, U.K. major cities and retail parks. Capital growth is positive. Leasing is well ahead of ERV, and consumer spend is growing. This is where the operational evidence becomes the like-for-like income story. Reversion is being captured. The trajectory is accelerating, and the concentration of capital in the right areas is doing the work it was meant to do. So rather than spreading capital thinly, we're concentrating it where the evidence supports continued growth, and that alignment between strategy and performance is a key part of our investment case. I should highlight the role of execution at asset level using a few examples that show how active management is driving income growth. Regears, renewals and targeted investment are delivering measurable uplifts in rent and improving income quality. This is where the strategy becomes tangible, not in theory, but in the day-to-day management of assets. Our data, our people and our platform enable us to consistently unlock value across the whole portfolio. And it is this consistent execution that underpins overall performance. So to conclude, this has been a year of strong progress. We have scaled the platform with Capital & Regional fully integrated, reposition the portfolio towards our highest conviction areas and strengthened the balance sheet through to a fully unsecured structure, all while delivering earnings and NTA per share growth and a market-leading total accounting return. The strategy is clear, essential everyday destinations delivered through one integrated operating model. The portfolio is delivering, with 75% concentrated in our 3 highest conviction areas, where we are seeing rental and capital growth. And we're confident in the outlook supported by leasing liquidity, capital discipline and a well-covered progressive dividend. Taken together, we are targeting a total accounting return of 9% to 11% per annum through to FY '29. That is the framework we want to be judged against, and we believe the business is set up to deliver it.

With that, we will now take some questions starting in the room first then move to those joining us online. Before asking your question, please confirm your name and your company.

Bjorn Zietsman from Panmure Liberum. Just a quick question across your 3 focus areas, I'm just wondering where you're seeing the most opportunities over the next 12 months, if you are intending to flex your LTE.

Well, we're confident that we will have opportunities in our 3 sort of key focus areas. And as we said in the presentation, our job is to allocate capital into the highest use value at that time. And we're really positive around London retail. We think there's a real opportunity for us to increase our weighting. And it's the same with U.K. major cities. And retail parks, as you know, has been a sector that we started investing in quite a number of years ago. So we think these are the right areas to be focused on, and it's all about these areas are the areas we are more likely to deliver that consistent rental income growth, which is what we're after.

Just a question on your capital partnerships. Can you remind us of your ambitions there and what your targets are?

Well, it's all about delivering earnings growth at the corporate level through the provision of asset management services in return for fee income. As you know, Bjorn, we've been growing our net income net of costs around about 20% per annum. We had further good growth in FY '26, and we see no reason whatsoever as to why we can't continue with that sort of growth rate over the next sort of 3 to 5 years. I think we've got Andrew in the front here.

Andrew Saunders from Shore Capital. If I could just pick up on Bjorn's question on the capital partnerships. Perhaps one for Will. Could you just tell us what the like-for-like change was in growth during the year? Because obviously, you had Ellandi, think the year before, and perhaps just talk about the benefits of having the Ellandi platform in terms of future growth outlook?

Do you want to pick up the...

Yes, I think the growth that came through this year was probably the full annualization of the Ellandi transaction. That was probably the key driver of the growth. There would have been some other smaller mandates that we've picked up. But I think the key driver of the sort of GBP 0.7 million of growth that we saw come through this year, was the full benefit of Ellandi.

Yes. And then the other benefits around that Ellandi transaction was, first of all, it was very earnings accretive transaction, Andrew. Secondly, it allowed us to diversify our partnerships because prior to Ellandi, we had about 4 partners, one particularly key one. So we spread that concentration because we now have around about 12 capital partners. And then finally, it just brought some additional talent into the business. So we're really pleased with how that transaction has progressed.

I think we'd expect to see more growth going forward, wouldn't we?

Definitely. There's a question over there.

It's Martyn King from Edison. You gave the occupational cost ratios, Allan, could you just put a bit more perspective on that? How they tend to move over time? Where the pressure points in terms of your ability to capture reversion are? And also at the moment, are there any particular occupiers that you're giving a particular eye on?

Well, just in terms of the occupational cost ratio, we ended the financial year with an all-in occupational cost ratio of 7.8%. So that includes business rates, rent, service charge. And at 7.8%, we would regard that as being highly affordable, which means it's going to be highly sustainable. And indeed, we believe that it creates the opportunity for us to capture that reversion. Put that into context, Martyn, at the half year results, our occupational cost ratio was 8.2%. Now there are 2 drivers for that improvement. First of all, we had -- we were a big beneficiary of business where our tenants were a big beneficiary of the business rates reform when the government introduced a permanent discount for retail, hospitality and leisure for ratable units under 500,000. So the business rates our tenants are paying have come down from the 1st of April, and we can see that in the occupational cost ratio. And secondly, over the last sort of 12 months, our customers have experienced an increase in customer spending in our tenants. So it's in customer spending growth. So it's a really good place to be. I would say we probably got one of the most favorable occupational cost ratios within the market. And it just adds to our confidence around going after that rental reversion. We just feel that the income growth story is starting to build up really nicely, and you can see that in our compound annual growth rates, which we've been tracking for the last sort of 4 financial years. All of that is steadily improving now, which is really positive.

And for Will, maybe. In terms of LTV flexing, Will, is your recent history as sort of a guide to how far you're prepared to take LTV and how quickly you want to bring it down again.

Yes, Martyn. I think as you've alluded to, post C&R, we increased -- and it was part of the pro forma guidance as part of the transaction. We increased our loan to value up to 42.5%. We then sold some assets in the first half, did the buyback and ended up back at 42% again. And then we were able to get back below 40% quickly or in line with 40% very quickly. So we've demonstrated that actually within pretty short periods of time, which I think is a good indication, that we can flex that LTV up. And then because of the liquidity of our assets, we can get back down between -- below our loan-to-value guidance very quickly. In terms of level, I think in and around that kind of level, possibly even very slightly higher, again, because this year, we've managed to sell GBP 110 million of assets in line with book value. That's what gives us the confidence alongside our ICR and our net debt to EBITDA, which, as I said in my presentation, are market leading.

Okay. I think -- any questions online?

We've got one question. So that comes from [ Othman El Iraki ] from Fidelity. Given the recent GBP 120 million term in place, is it fair to say that you are not likely to access the unsecured bond market in the near term?

Thank you for your question, Othman. No, I think the way I would look at it is we had -- as part of the Capital & Regional transaction, we inherited The Mall facility, had a 3.5% coupon. That's why we kept hold of it. That coupon was always due to expire in January '27. Part of the transaction underwrite was we always looked through that refinancing. And effectively, I would see that the GBP 240 million -- but a GBP 120 million drawn refi we've just done is effectively just refinancing The Mall, getting the maximum benefit out of that coupon, but dealing with the refinancing now. In terms of looking through to the bond, obviously, we've maintained the investment-grade credit ratings issued by Fitch since 2018 when the bond was first put in place. We've had a really good experience with the bond. We have a good relationship and good engagement with bondholders. So when we were talking about the size, the minimum size of the refi, we were just trying to put it into context effectively. I think we have maintained access to the bond market. I think we would be keen to issue a bond in the future, but we could also look at USPPs and we could also look at the clearers again because actually, one of the things that was interesting this time on the unsecured refi we've just completed, we had, I would say, more competitive tension than we have in the past, which is positive when we look ahead to the next stage of our refi.

One more questions come in from [ Guillaume Langiere ]. How should we model your cost of debt in 2027 given your new collar and your bond currently yielding 5.4%?

I think in terms of our sort of P&L UFFO cost of debt, for the first 9 months of the year, it will be very, very similar to FY '26. We'll have the GBP 0.6 million commitment fee that we've talked about on the undrawn term facility commitment. And then in the final quarter, depending on where rates are at the time, that cost will just ratchet up just for that final quarter as the term facility commitment is grown -- is drawn, and it will be between 4.4% and 5.9% per the collar. The bond will remain at 3.5%.

Okay. That concludes the online questions. So I will hand back to Allan.

Thank you, Lucy. And I'd just like to thank everybody here for joining us on this rainy morning. I hope you agree that the sun has been shining on NewRiver over the last 12 months. Will and I look forward to meeting with our shareholders over the coming weeks, and do keep an eye out for our annual report, which will be out later this month. Thank you.