GCP Student Living : Half-yearly Report

GCP STUDENT LIVING PLC HALF-YEARLY REPORT AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE PERIOD ENDED 31 DECEMBER 2014 GCP Student Living plc, the first student accommodation REIT in the UK, today announces its results for the period ended 31 December 2014. The full half-yearly report and consolidated financial statements can be accessed via the Company's website at www.gcpuk.com/gcp-student-living-plc or by contacting the Company Secretary by telephone on 01392 477500. HIGHLIGHTS FOR THE PERIOD * The Company delivered a strong set of results generating a total profit for the period of £11.9 million. * The Company's properties continue to benefit from the supply/demand imbalance for high-quality, modern student facilities in London, with all properties fully occupied and rental growth of 3.6% for the 2014/15 academic year. * Total shareholder returns for the period of 10%, including NAV per share growth of 7.8% to 110.77 pence. * Annualised dividend growth of 2.6%, with interim dividends of 2.80 pence per share. * EPS of 10.86 pence and EPRA EPS of 2.59 pence. * EPRA NAV per ordinary share of 110.77 pence and EPRA NNNAV per ordinary share of 110.52 pence at 31 December 2014. * High-quality portfolio of three modern, purpose-built properties with 984 beds located in and around London with a 6% valuation uplift to £160.7 million over the period. * Net debt-to-property value ratio at 31 December 2014 of 24.6%. * Strong pipeline of investments for the 2015/16 academic year including commitments to acquire Scape Surrey and The Pad 2, located adjacent to RHUL, with advanced negotiations underway for the acquisition of a third newly built property in a prime London location. For more information: Gravis Capital Partners LLP Tom Ward tom.ward@gcpuk.com 020 7518 1496 Cenkos Securities plc Dion Di Miceli ddimiceli@cenkos.com 020 7397 1921 Tom Scrivens tscrivens@cenkos.com 020 7397 1915 Buchanan Charles Ryland charlesr@buchanan.uk.com 020 7466 5000 Sophie McNulty sophiem@buchanan.uk.com GCP Student Living plc was the first real estate investment trust in the UK focused on student residential assets. The Company invests in modern, mostly purpose-built, private student residential accommodation and teaching facilities located primarily in and around London. Our primary objective is to provide shareholders with regular, sustainable, long-term dividends coupled with the potential for modest capital appreciation over the long term and RPI inflation-linked income characteristics. The Company invests in properties located primarily in and around London where the Investment Manager believes the Company is likely to benefit from supply and demand imbalances and a growing number of international students. The Company is a closed-ended investment company incorporated in England and Wales, and its shares trade on the SFM. AT A GLANCE £11.9m 2.80p Profit for the half year Interim dividends for the half year HY 2013 - £3.7m HY 2013 - 2.73p* 110.77p £160.7m EPRA NAV per ordinary share Value of investments HY 2013 - 100.29p HY 2013 - £107.5m 10% 3.6% Total shareholder return for Rental growth the half year HY 2013 - 3.3% HY 2013 - 4.8% * Six month equivalent to 31 December 2013. INVESTMENT OBJECTIVES The Company invests in UK student accommodation to meet the following key objectives: Dividend Capital Portfolio income appreciation quality To provide shareholders To provide modest Focus on high-quality, with a regular, capital appreciation modern, mostly sustainable, long-term over the long term. purpose-built, private dividends, RPI student residential inflation-linked accommodation and teaching characteristics. facilities for students studying at leading academic institutions primarily in and around London. The Company has paid/ The valuation of the The Company's property declared a total of Company's property portfolio comprises 2.80 pence per ordinary portfolio has increased three high-specification, share in the period, by 6% over the period modern, purpose-built increasing the Company's driven by a combination student residential dividend in excess of RPI of yield compression and accommodation buildings on an annualised basis. increasing rental rates. in and around London. Key performance highlights 2.80p 6% 100% Dividends paid/declared in Capital appreciation Occupancy for 2014/15 the period academic year 2.6% £160.7m 41 Annualised dividend growth External valuation of Number of HEIs investments CHAIRMAN'S STATEMENT Introduction On behalf of the Board, I am pleased to report a period of continued profitability and earnings growth, with the Company reporting a total profit of £11.9 million and EPS for the six month period to 31 December 2014 of 10.86 pence. The Company's property portfolio is operating at full occupancy, generating £5.6 million in rental income, up from £4.6 million reported at the prior half-year end, reflecting rental growth and the larger property portfolio following the acquisition of The Pad and Scape Greenwich in December 2013 and May 2014 respectively. The Company delivered a dividend yield of 5.5% in its first year and seeks to grow the dividend in line with RPI in terms of pence per share. The Company increased its dividend for the period by 2.6% on an annualised basis, paying/ declaring a dividend of 1.40 pence per share for each of the two financial quarters. The Company has delivered a total return of 10% for the six month period to 31 December 2014. Property portfolio The Company's property portfolio is fully occupied for the 2014/15 academic year, with 3.6% average gross rental uplift year-on-year. The values of the Company's property assets have performed ahead of expectations with a 6% uplift in the period, driven by a combination of yield compression and increasing rental rates. The external valuation of the Company's property portfolio was £160.7 million as at 31 December 2014, up from £151.6 million at 30 June 2014. Financial results The Company generated net operating income of £4.3 million, operating profit of £12.6 million and total profit after finance costs of £11.9 million in the six months to 31 December 2014. The Company's basic EPS for the period was 10.86 pence and EPRA EPS was 2.59 pence. EPRA NAV per ordinary share has increased by 8.13 pence, with reference to the EPRA NAV at 30 June 2014, to 110.77 pence, driven by high occupancy, year-on-year rental growth and portfolio valuation uplifts. Dividends The Company has declared a total dividend of 2.80 pence per ordinary share in respect of the half year ended 31 December 2014. The first interim dividend of 1.40 pence per share was paid on 5 December 2014. On 28 January 2015, the Company declared a second interim dividend of 1.40 pence per share for the quarter ended 31 December 2014. The second interim dividend will be paid on 5 March 2015, as 1.12 pence per ordinary share as a PID in respect of the Group's tax exempt property rental business and 0.28 pence per ordinary share as a non-PID. AIFMD The Company is classed as an externally managed AIF under the AIFMD. The Investment Manager acts as the Company's AIFM and Langham Hall LLP provides depositary services to the Company. Delisting from the CISEA As announced to the market on 10 September 2014, following consultation with the Company's legal and financial advisers, the Board decided that it was no longer in the interests of shareholders for the Company to retain a listing of its ordinary shares on the CISEA, given the ongoing costs of such listing. The delisting from the CISEA took effect on 10 October 2014. The Company's ordinary shares continue to trade on the SFM. Possible equity raise The Company has continued to perform strongly since IPO against an encouraging backdrop for the student residential accommodation market, particularly in the Company's core market in and around London where the supply/demand imbalance for student residential accommodation is particularly acute. Looking forward, the Company has committed to acquire Scape Surrey (formerly Scape Guildford) and The Pad 2, located adjacent to RHUL, and is in advanced negotiations for the acquisition of a c.550 bed new build asset in a prime London location. These three developments, with an aggregate of c.800 beds, are close to completion for the start of the 2015/16 academic year. Accordingly, the Board is considering an equity raise in June 2015 to fund the acquisitions of these assets. It is currently envisaged that the Company will seek to raise between approximately £80 million to £100 million of equity. Following the acquisition of these three assets the Company will have a portfolio of properties located in and around London with an aggregate of c.1,800 beds. It is currently envisaged that any such capital raise would be structured by way of an issue of convertible preference shares ("C Shares"). Any issue of C Shares would be structured so as to not be dilutive to existing shareholders' NAV, with any costs directly attributable to such issuance being borne by subscribers to the C Share issue. The Company is taking legal, tax and financial advice and will make a further announcement in due course. Outlook The structural supply and demand imbalance for student residential accommodation, notably in London which is the Company's primary market, remains acute. Housing supply by HEIs remains flat in the capital, while the private residential rented sector is facing more onerous regulations and rising demand from non-students. Whilst London continues to have the largest student population of any city in the UK (and the largest number of international students of any city in the world), there remains a shortage of purpose-built modern accommodation. This shortfall underpins the strong performance of the asset class in London, as evidenced in part by the 6% valuation uplift seen by shareholders in the period to 31 December 2014. Looking forward, whilst student numbers are expected to continue to rise in London, supply is expected to remain constrained, with planning reforms and rising land values making it ever more difficult to bring new developments on-stream. The relative attraction of the asset class has seen a broad range of global investors seeking direct exposure to the market, including pension funds, private equity buyers and established and new student residential accommodation operators. The outlook for the market in which the Company operates is highly encouraging. The Board nonetheless remains aware of the risks inherent in a market where valuations are being driven up on existing student residential developments which may be suitable for the Company's portfolio. Against this background, the Board believes that the Company's existing investment policy may in future constrain its ability to source and secure investment in suitable opportunities offering an attractive total return profile for shareholders in the longer term and may limit the Company's ability to grow its asset base, which in its own right will broaden the shareholder base and enhance market liquidity for all shareholders. Accordingly, the Board is considering whether it would be appropriate for the Company to consider a modification to the current investment policy to permit investment in development and forward-funded projects where such projects are income-generative, thereby securing operational new-build properties in which the Company is currently unable to invest under its existing investment policy. This would enable the Company to benefit from the availability of additional attractive projects in and around London. Any modification to the Company's investment policy will only be made with the approval of shareholders at a general meeting of the Company. The Board will obtain legal and financial advice ahead of putting any such proposals to shareholders which, if deemed suitable, would be presented to shareholders for their approval at the AGM later this year. Robert Peto Chairman 25 February 2015 COMPANY KEY FACTS Company information GCP Student living plc is a closed-ended investment company incorporated in England and Wales on 26 February 2013 as a public company limited by shares under the Companies Act 2006 (registered number 8420243). The principal legislation under which the Company operates is the Companies Act 2006. The Company's shares trade on the SFM. Investment Manager Gravis Capital Partners LLP is the Investment and AIFM Manager and AIFM to the Company. The Investment Manager was incorporated in England and Wales on 14 October 2007 under the Limited Liability Partnership Act 2000 (registered number OC332060) and is authorised and regulated by the Financial Conduct Authority (registration number 487393). Administrator Capita Sinclair Henderson Limited is a company incorporated in the UK on 18 September 1986 with registered number 2056193. Company Secretary Capita Company Secretarial Services Limited is a company incorporated in the UK on 7 December 2004 with registered number 5306796. Stockbroker Cenkos Securities plc. Depositary Langham Hall LLP. Investment strategy The Company operates as a student accommodation REIT. It invests in modern, purpose-built student accommodation primarily in and around London. Market capitalisation At 31 December 2014: £127.1 million. Net assets At 31 December 2014: £121.5 million. Annual management fee The Company has entered into an investment management agreement with Gravis Capital Partners LLP. The Investment Manager is entitled to receive from the Company, in respect of its services provided under the investment management agreement, a management fee accrued daily and payable quarterly in arrears calculated at an annual rate of 1% of the prevailing NAV. Under the terms of the Scape East and Scape Greenwich Asset and Facilities Management Agreement, Scape is entitled to a fee which is calculated and paid quarterly in arrears and is equal to one-quarter of the Investment Manager's management fee attributable to those assets in the Group's portfolio for which it provides asset and facilities management services. The Investment Manager is also entitled to receive a fee of £22,500 for its services to the Company as the Company's AIFM. ISA, SSAS and SIPP status The Company's ordinary shares are eligible for inclusion in ISAs (subject to applicable subscription limits) provided that they have been acquired by purchase in the market, and they are permissible assets for SSAS and SIPPs. AIFMD status The Company is classed as an externally managed AIF under the AIFMD. Investment policy The Company's investment policy is detailed below. Website www.gcpuk.com/gcp-student-living-plc INVESTMENT MANAGER'S REPORT Investment objective The Company's investment objective is to provide shareholders with regular, sustainable, long-term dividends (with RPI inflation-linked characteristics) coupled with the potential for modest capital appreciation over the long term. Investment policy The Company intends to meet its investment objective through owning, leasing and licensing student residential accommodation and teaching facilities to a diversified portfolio of direct let tenants and HEIs. The Company will invest in modern, mostly purpose-built, private student residential accommodation and teaching facilities located primarily in and around London where the Investment Manager believes the Company is likely to benefit from supply and demand imbalances for student residential accommodation. Rental income will predominantly derive from a mix of contractual arrangements including direct leases and/or licences to students ("direct let agreements"), leases and/or licences to students guaranteed by HEIs and/or leases and/or licences directly to HEIs. The Company may enter into soft nominations agreements (pari passu marketing arrangements with HEIs to place their students in private accommodation) or hard nominations agreements (longer-term marketing arrangements with HEIs of between 2 and 30 years in duration). The Company intends to focus primarily on accommodation and teaching facilities for students studying at Russell Group universities and other leading academic institutions, regional universities with satellite teaching facilities in and around London and at specialist colleges. The Company may acquire properties directly or through holdings in special purpose vehicles and properties may be held through limited partnerships, trusts or other vehicles with third-party co-investors. Investment restrictions The Company will invest and manage its assets with an objective of spreading risk through the following investment restrictions: * the Company will derive its rental income from a portfolio of not less than 500 units; * at least 90% by value of the properties directly or indirectly owned by the Company shall be in the form of freehold or long leasehold (over 60 years remaining at the time of acquisition) properties or the equivalent; * the Company will not invest in development assets or assets which are unoccupied or not producing income at the time of acquisition; and * the Company will not invest in closed-ended investment companies. Use of derivatives The Company may invest through derivatives for efficient portfolio management. In particular, the Company engages in interest rate hedging or otherwise seeks to mitigate the risk of interest rate increases as part of the Company's efficient portfolio management. Borrowing and gearing policy The Company may use gearing to enhance returns over the long term. The level of gearing will be governed by careful consideration of the cost of borrowing and the Company may use hedging or otherwise seek to mitigate the risk of interest rate increases. Gearing, represented by borrowings as a percentage of gross assets, will not exceed 55% at the time of investment. It is the Directors' current intention to target gearing of less than 30% of gross assets in the long term and to comply with the REIT condition relating to the ratio between the Company's `property profits' and `property finance costs'. The Directors currently intend, at all times, to conduct the affairs of the Company so as to enable it to qualify as the principal company of a REIT Group for the purposes of Part 12 of the Corporation Tax Act 2010 (and the regulations made thereunder). In the event of a breach of the investment guidelines and restrictions set out above, the Investment Manager shall inform the Directors upon becoming aware of the same and if the Directors consider the breach to be material, notification will be made to a Regulatory Information Service. No material change will be made to the investment policy without the approval of shareholders by ordinary resolution. Business and status of the Company The Company is registered as a public limited company and is an investment company within the terms of section 833 of the Companies Act 2006. The Company is a REIT for the purposes of Part 12 of the Corporation Tax Act 2010. Notification has been submitted to, and acknowledged by, HMRC for the Company to enter the UK REIT regime. The Company will be treated as a REIT so long as it continues to meet the REIT conditions in relation to any accounting period. The Company was incorporated on 26 February 2013. The Company's shares are traded on the SFM. The Investment Manager The Company receives investment advice and management services from the Investment Manager, Gravis Capital Partners LLP. The Investment Manager was incorporated in England and Wales on 14 October 2007 under the Limited Liability Partnership Act 2000 (registered number OC332060) and is authorised and regulated by the Financial Conduct Authority (firm reference number 487393). The Investment Manager has day-to-day responsibility for the control and supervision of the asset and facilities managers of the Company's portfolio assets. Gravis Capital Partners LLP was formed with a view to developing a specialist infrastructure advisory boutique. This business model was amended to focus specifically on fund management, principally on income-generating defensive sectors central to the UK's social and community infrastructure. The Investment Manager has advised on student accommodation and educational assets since its formation and its senior management team have combined experience of over 30 years in the sector. In the last ten years, the partners of the Investment Manager have advised on the financing, development, acquisition and management of student accommodation and educational property assets with a value in excess of £500 million. Financial results The Company delivered a strong set of half-yearly results with profit for the period of £11.9 million and EPS of 10.86 pence, following higher than anticipated valuation gains on the Company's property portfolio as a result of yield compression and increasing rental rates. EPRA EPS was 2.59 pence, reflecting income per share of the Group's property rental business and excludes non-recurring items such as valuation uplifts and movements in the fair value of derivatives. The property portfolio generated rental income of £5.6 million for the period, with 3.6% average rental uplift year-on-year. The Company incurred property operating expenses of £1.2 million, increasing principally due to the impact of prior period acquisitions and additional one-off operating expenses associated with the prior period. Administration expenses of £0.8 million include the Investment Manager's fee and other service providers' costs incurred in the period. Administration expenses have increased due to the acquisition of the Company's subsidiaries and their associated administrative costs. Total gains on investment properties in the period amounted to £9.1 million, generating operating profit for the Company of £12.6 million. Finance costs fell to £0.7 million as a result of the Company's significantly improved financing arrangements with its lender, Barclays, and the replacement of the previous interest rate swap with a new swap with a notional value of £ 20.0 million, which reduced the Group's weighted average cost of debt from 4.4% to 3.0%. The Company is operating with a debt-to-property value at 31 December 2014 of 24.6% (30 June 2014: 26.0%). At 31 December 2014, there were no dilutive equity instruments in issue and, therefore, the Company's basic and diluted EPS was 10.86 pence per share. Dividends The Company delivered a dividend yield of 5.5% in its first year and seeks to grow the annual dividend line with RPI. The Company has paid/declared interim dividends of 2.80 pence per share for the period to 31 December 2014, increasing the dividend for the period by 2.6% on an annualised basis. The first interim dividend was paid in full as a PID in respect of the Group's tax exempt property rental business. The second interim dividend, which will be paid on 5 March 2015, consists of a PID payment of 1.12 pence per ordinary share and a non-PID payment of 0.28 pence per ordinary share. Financial performance Income statement Period from 1 July 26 February 2014 to 2013 to 31 December 31 December 2014 2013 £'000 £'000 Rental income 5,578 4,569 Operating expense (1,236) (590) Net operating income 4,342 3,979 NOI margin 78% 87% Administration expenses (813) (717) Gains on investment properties 9,090 1,275 Operating profit 12,619 4,537 Finance costs (685) (888) Profit for the period 11,934 3,649 EPS (pps) 10.86p 5.20p Banking covenants The Company's debt facility includes loan-to-value and interest cover covenants that are measured at a Group level. The Company has maintained significant headroom against all measures throughout the period under review and was in full compliance with all loan covenants at 31 December 2014. Cash flow generation The Company generated £3.3 million of cash flows from operating activities in relation to its student accommodation portfolio. The Company paid finance costs of £0.6 million and dividends to shareholders of £3.0 million, resulting in a net decrease of £0.3 million in cash and cash equivalents at the period end. Net assets Net assets attributable to equity holders at 31 December 2014 were £121.5 million (30 June 2014: £112.9 million). Property valuation gains, together with retained profits, contributed to a 7.9% growth in EPRA NAV, an increase of 8.13 pence on the 30 June 2014 NAV. At 31 December 2014, there were 109,910,428 shares in issue, giving an EPRA NAV per ordinary share of 110.77 pence (30 June 2014: 102.68 pence). The EPRA NAV excludes the fair value mark-to-market valuation of the Company's financial derivative instrument, which is used to manage adverse effects of interest rate movements on the Company's debt facility. Accordingly, taking into account the fair value mark-to-market valuation of this financial derivative instrument based on current gilt rates, the EPRA NNNAV at 31 December 2014 is 110.52 pence per ordinary share (30 June 2014: 102.64 pence per ordinary share). Financial performance Net assets 31 December 30 June 2014 2014 Assets £'000 £'000 Property 160,650 151,560 Receivables 1,691 1,362 Cash and cash equivalents 4,207 4,585 Total assets 166,548 157,507 Liabilities Payables (3,044) (3,168) Deferred income (2,523) (2,028) Senior loan (39,513) (39,456) Total liabilities (45,080) (44,652) Net assets 121,468 112,855 Number of shares 109,910,428 109,910,428 EPRA NAV per share (pps) 110.77p 102.68p EPRA NNNAV per share (pps) 110.52p 102.64p Share price performance The Company's shares have continued to trade at a premium to EPRA NAV with an average premium over the period of 5.4%. The Company's share price hit an all-time high of 116.13 pence per share on 11 December 2014. The 52-week low of 103 pence coincided with the Company going ex-dividend on its fourth interim dividend for the year ended 30 June 2014, as would be expected. The Company produced 20% total return during the period on an annualised basis, considerably in excess of its target. This was driven by the stated dividend declarations and payments alongside above forecast share price performance. Investment portfolio The Company's property portfolio consists of three residential student accommodation properties, Scape East, Scape Greenwich and The Pad. The Company acquired its seed asset, Scape East, in May 2013. The Company built on its initial acquisition by acquiring The Pad in December 2013. The Company's most recent acquisition, Scape Greenwich, was acquired in May 2014. Scape East 450 Mile End Road, London E1 4GG Location: London Number of rooms: 588 Scape East is located directly opposite QMUL in Mile End, East London. It houses 588 self-contained, high-specification studios, as well as c.20,000 square feet of teaching facilities let on a 30-year lease. The property has two onsite restaurants, common areas with a games room, TV room and quiet study areas. In addition to this, students have their own communal kitchen, cinema room and private gym all located within the building. Scape Greenwich Bear Point, 2 East Parkside, Greenwich SE1 0FQ Location: London Number of rooms: 280 Scape Greenwich is located on the Greenwich peninsula in London, a prime student residential location within 30 minutes of c.75% of London's HEIs and in close proximity to Ravensbourne College with c.1,600 students, a leading specialist digital media HEI, and to the University of Greenwich with c.26,000 students. The Pad 71 Egham Hill, Egham TW20 0ER Location: Egham Number of rooms: 116 The Pad is located adjacent to the entrance to the RHUL campus. The building is a modern, purpose-built student accommodation block offering 116 rooms comprising of 15 studios and 101 en-suite rooms. The studios comprise fully-furnished rooms with kitchenette and appliances provided and en-suite shower room. Asset performance In September 2014, Scape East commenced its third academic year of operation, with Scape Greenwich and The Pad now into their respective second academic years. The properties are all fully occupied for the 2014/15 academic year, all on 51-week tenancies. The Company's property portfolio has continued to perform strongly, with a valuation of £160.7 million driving property revaluation gains of £9.1 million since 30 June 2014. The valuation uplift can be attributed to 3.6% year-on-year rental growth and yield compression of c.20 bps across the Company's portfolio. The student mix for Scape East, Scape Greenwich and The Pad has remained fairly static compared to the 2013/14 cycle, with international students up 4% and EU and UK students both down 2%, reflecting the asset and facilities managers' continued drive to attract international student residents. The population of international student residents has increased 2% year-on-year to 87%, with the majority coming from non-EU countries. Approximately 77% of the student population are undergraduates, with the remainder studying at postgraduate level. There are 41 HEIs represented across the student resident population for the 2014/15 academic year. QMUL continues to supply the majority of the students at Scape East, accounting for over 75% of the total direct let population, which is broadly consistent with 2013/14 levels. Market summary Higher education continues to be a mainstay of the UK's economic growth and one of the country's leading service exports. The UK has the second largest market share of international students after the US, with 13% of all international students studying outside of their country of origin. Students' decisions to study in the UK are primarily driven by the combination of English language education, comparatively cheaper course costs and the high quality of education on offer, with ten universities in the top 100 universities in the world. The 2014/15 academic year was the strongest on record in the UK, with 512,400 applicants placed in higher education through UCAS, the first time the service has placed over half a million people. The year-on-year increase was a total of 16,800 more students placed in 2014 than in 2013, an increase of 3.4%. Students have begun the process of applying for the 2015/16 academic year. This is the first year that the UK government has removed the cap on the number of places that can be offered by an HEI to UK students. The first set of application data for the January 2015 deadline produced by UCAS showed a 2% year-on-year increase, with the strongest growth coming from international students, where applications were more than 5% up on the previous year. London saw the largest increase in demand, with 44% of 18-year olds now applying. Student accommodation The market has continued its strong performance in the period with over £2 billion of investment activity in the past twelve months. What was once a niche alternative property asset class is now very much a mainstream investment opportunity with a broad spectrum of institutional and private investors in the sector. There continues to be a shortfall of supply and an excess of demand for purpose-built student accommodation in the majority of UK cities. The combination of this market disequilibrium and an increasing number of investors has had the effect of reducing yields in the sector over the period, much in line with the wider property market. The supply/demand imbalance continues to be at its most acute in London, where there remains a c.190,000 bed shortfall. The Investment Manager is of the opinion that this shortfall will continue to persist over the coming years due to the restrictive planning regime and strong alternate use values of land, primarily driven by the residential sector. The pipeline for London over the following two years is well below the forecast increase in student numbers and is therefore likely to lead to further rental increases. INTERIM MANAGEMENT REPORT AND DIRECTORS' RESPONSIBILITY STATEMENT Interim management report The important events that have occurred during the period under review, the key factors influencing the consolidated financial statements and the principal factors that could impact the remaining six months of the financial year are set out in the Chairman's statement and the Investment Manager's report above. The Directors consider that the principal risks facing the Company are substantially unchanged since the date of the annual report for the period ended 30 June 2014 and continue to be as set out in that report. Risks faced by the Group include, but are not limited to, investment and strategy, general property and investment market conditions, property valuation, portfolio performance, dividends, borrowings, taxation, compliance with laws and regulations, market risk, interest rate risk, credit risk and liquidity risk. Responsibility statement The Directors confirm that to the best of their knowledge: * the half-yearly report and consolidated financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting issued by the IASB; * the half-yearly report and consolidated financial statements give a true and fair view of the assets, liabilities, financial position and return of the Company; and * the half-yearly report and consolidated financial statements include a fair review of the information required by: (a) 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the consolidated financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and (b) 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the Company during that period; and any changes in the related party transactions described in the last annual report that could do so. The half-yearly report and consolidated financial statements were approved by the Board of Directors on 25 February 2015 and the above responsibility statement was signed on its behalf by Robert Peto, Chairman. CONSOLIDATED INCOME STATEMENT For the six months ended 31 December 2014 1 July 26 February 2014 to 2013 to 31 December 31 December 2014 2013 Continuing operations Notes £'000 £'000 Revenue 5,578 4,569 Property operating expenses (1,236) (590) Gross profit 4,342 3,979 Administration expenses (813) (717) Operating profit before gains on investment properties 3,529 3,262 Fair value gains on investment properties 9,090 1,275 Operating profit 12,619 4,537 Finance income 5 3 Finance expenses (690) (891) Profit before tax 11,934 3,649 Tax charge on residual income - - Profit for the period 11,934 3,649 EPS (basic and diluted) (pps) 6 10.86 5.20 The accompanying notes form an integral part of these financial statements. CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the six months ended 31 December 2014 1 July 26 February 2014 to 2013 to 31 December 31 December 2014 2013 £'000 £'000 Profit for the period 11,934 3,649 Other comprehensive income to be reclassified to profit and loss in subsequent periods Net gains on cash flow hedges (331) (868) Total comprehensive income for the period 11,603 2,781 The accompanying notes form an integral part of these financial statements. CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 31 December 2014 31 December 30 June 2014 2014 Assets Notes £'000 £'000 Non-current assets Investment property 3 160,650 151,560 Retention account 957 956 161,607 152,516 Current assets Cash and cash equivalents 3,250 3,629 Trade and other receivables 1,691 1,315 Derivative financial instruments - 47 4,941 4,991 Total assets 166,548 157,507 Liabilities Non-current liabilities Interest bearing loans and borrowings 8 (39,513) (39,456) Derivative financial instruments (284) - Retention account (957) (956) (40,754) (40,412) Current liabilities Trade and other payables (1,803) (2,212) Deferred income (2,523) (2,028) (4,326) (4,240) Total liabilities (45,080) (44,652) Net assets 121,468 112,855 Equity Share capital 1,099 1,099 Share premium 40,025 39,937 Hedging reserve (284) 47 Retained earnings 80,628 71,772 Total equity 121,468 112,855 Number of shares in issue 109,910,428 109,910,428 EPRA NNNAV per share (pps) 7 110.52 102.68 EPRA NAV per share (pps) 7 110.77 102.64 The accompanying notes form an integral part of these financial statements. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the six months ended 31 December 2014 Share Share Hedging Retained capital premium reserve earnings Total £'000 £'000 £'000 £'000 £'000 Balance at 1 July 2014 1,099 39,937 47 71,772 112,855 Profit for the period - - - 11,934 11,934 Other comprehensive income that may be reclassified subsequently to profit and loss Net gains on cash flow hedges - - (331) - (331) Total comprehensive income 1,099 39,937 (284) 83,706 124,458 Share issue cost adjustments - 88 - - 88 Dividends - - - (3,078) (3,078) Balance at 31 December 2014 1,099 40,025 (284) 80,628 121,468 The accompanying notes form an integral part of these financial statements. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the period 26 February 2013 to 31 December 2013 Share Share Hedging Retained capital premium reserve earnings Total £'000 £'000 £'000 £'000 £'000 Profit for the period - - - 3,649 3,649 Other comprehensive income that may be reclassified subsequently to profit and loss Net gains on cash flow hedges - - (868) - (868) Total comprehensive income - - (868) 3,649 2,781 Ordinary shares issued 701 69,399 - - 70,100 Share issue costs - (2,041) - - (2,041) Share premium cancelled on 31 July 2013 - (67,358) - 67,358 - Dividends - - - (1,402) (1,402) Balance at 31 December 2013 701 - (868) 69,605 69,438 The accompanying notes form an integral part of these financial statements. CONSOLIDATED STATEMENT OF CASH FLOWS For the six months ended 31 December 2014 1 July 26 February 2014 to 2013 to 31 December 31 December 2014 2013 £'000 £'000 Cash flows from operating activities Operating profit 12,618 4,538 Adjustments to reconcile profit for the period to net cash flows: Gain from change in fair value of investment properties (9,090) (1,490) Decrease/(increase) in other receivables and prepayments 184 (718) (Decrease)/increase in other payables and accrued expenses (376) 2,362 Net cash flow generated from operating activities 3,336 4,692 Cash flows from investing activities Acquisition of investment properties - (35,221) Acquisition of subsidiaries, net of cash acquired - (13,030) Net cash used in investing activities - (48,251) Cash flows from financing activities Proceeds from issue of ordinary share capital - 70,100 Share issue costs (47) (2,041) Received from subsidiary companies - 13,500 Part repayment of initial loan - (32,645) Finance income 6 - Finance expenses (638) (600) Dividends paid in the period (3,036) (1,215) Net cash flow (used in)/generated from financing activities (3,715) 47,099 Net (decrease)/increase in cash and cash equivalents (379) 3,540 Cash and cash equivalents at start of period 3,629 - Cash and cash equivalents at end of the period 3,250 3,540 The accompanying notes form an integral part of these financial statements. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS For the half year ended 31 December 2014 1. General information GCP Student living plc is a closed-ended investment company incorporated in the UK on 26 February 2013. The registered office of the Company is Beaufort House, 51 New North Road, Exeter EX4 4EP. The Company's shares trade on the SFM. 2. Basis of preparation These consolidated financial statements for the six months ended 31 December 2014 have been prepared in accordance with IAS 34 Interim Financial Reporting. They do not include all financial information required for full annual financial statements and have been prepared using the accounting policies adopted in the audited financial statements for the period ended 30 June 2014. Those financial statements were prepared in accordance with IFRS issued by the IASB as adopted by the European Union. These consolidated financial statements have been prepared under the historical cost convention, except for investment property, investments in subsidiaries and derivative financial instruments that have been measured at fair value. The financial statements are presented in sterling and all values are rounded to the nearest thousand pounds (£'000), except when otherwise indicated. The Group has chosen to adopt the EPRA best practice guidelines for calculating key metrics such as net asset value and earnings. The consolidated interim financial information includes the financial statements of the Company and its wholly-owned subsidiaries for the six months ended 31 December 2014. 2.1 Significant accounting policies With the exception of newly adopted standards, accounting policies are consistent with those of the annual report for the period ended 30 June 2014. Since that date, the following standards have been adopted: * IAS 27 Separate Financial Statements (as amended in 2011) - amendments for investment entities (effective for annual periods beginning on or after 1 January 2014); * IAS 32 Financial Instruments: Presentation - amendments to application guidance on the offsetting of financial assets and financial liabilities (effective for annual periods beginning on or after 1 January 2014); * IFRS 10 Consolidated Financial Statements - amendments for investment entities (effective for annual periods beginning on or after 1 January 2014); and * IFRS 12 Disclosure of Interests in Other Entities - amendments for investment entities (effective for annual periods beginning on or after 1 January 2014). 2.2 Segmental reporting The Directors are of the opinion that the Group is engaged in a single segment of business, being the investment in and provision of student accommodation in the UK. 2.3 Significant accounting judgements and estimates The preparation of these audited financial statements in accordance with IFRS requires the Directors of the Company to make judgements, estimates and assumptions that affect the reported amounts recognised in the financial statements. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability in the future. Judgements In the process of applying the Group's accounting policies, management has made the following judgements which have the most significant effect on the amounts recognised in the consolidated financial statements: Operating lease commitments - Group as lessor The Group has entered into commercial property leases on its investment property portfolio. The Group has determined, based on evaluation of the terms and conditions of the arrangements, such as the lease term not constituting a substantial portion of the economic life of the commercial property, that it retains all the significant risks and rewards of ownership of these properties and accounts for the contracts as operating leases. Valuation of property The valuations of the Group's investment property are at fair value as determined by the external valuer on the basis of market value in accordance with the internationally accepted RICS Valuation - Professional Standards January 2014 (incorporating the International Valuation Standards) and in accordance with IFRS 13. Going concern The Directors have made an assessment of the Group's ability to continue as a going concern and are satisfied that the Company has the resources to continue in business for the foreseeable future. Furthermore, the Directors are not aware of any material uncertainties that may cast significant doubt upon the Company's ability to continue as a going concern. Therefore, the financial statements have been prepared on the going concern basis. 3. UK investment property 31 December 30 June 2014 2014 £'000 £'000 Valuation at the start of the period 151,560 - Acquisitions arising from business combinations - 53,550 Acquisition of property - 93,000 Fair value gains on revaluation of investment property 9,090 5,010 Valuation at the end of the period 160,650 151,560 4. Taxation As a REIT, the Group's UK property rental business (both income and capital gains) is exempt from tax. Any residual income from non-property business is subject to corporation tax at a rate of 22.55%, representing the best estimate of the average annual effective tax rate expected for the full year, applied to the pre-tax income for the period. No tax charge has arisen on residual income for the period 1 July 2014 to 31 December 2014 (period: 26 February 2013 to 30 June 2014: nil). 5. Dividends 31 December Pence 31 December Pence 2014 per 2013 per share £'000 share £'000 First interim dividend paid 1.40 1,539 2.00* 1,403 Second interim dividend 1.40 1,539 1.35 946 declared Total 2.80 3,078 3.35 2,349 As a REIT, the Company is required to pay PIDs equal to at least 90% of the Group's exempted income after deduction of withholding tax at the basic rate (currently 20%). * The 2013 first interim dividend paid included the period since admission of the Company's shares to trading on the SFM on 20 May 2013. 6. Earnings per share Basic (and diluted) EPS amounts are calculated by dividing profit for the period attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares during the period. As there are no dilutive instruments outstanding, basic and diluted EPS are identical. 31 December 31 December 2014 2013 EPS 10.86p 5.20p Profit £11,934,000 £3,649,000 Weighted average number of shares 109,910,428 70,100,001 EPRA EPS 2.59p 3.39p Profit £2,844,000 £2,374,000 Weighted average number of shares 109,910,428 70,100,001 The EPRA EPS may be calculated as: 31 December 31 December 2014 2013 £'000 £'000 Group earnings for basic EPS 11,934 3,649 Fair value gains on investment properties (9,090) (1,275) Fair value movement on financial - - derivatives Group earnings for EPRA EPS 2,844 2,374 7. Net asset value per share Basic NAV per share amounts are calculated by dividing net assets attributable to ordinary equity holders of the Company by the number of ordinary shares outstanding at the end of the period. As there are no dilutive instruments outstanding, basic and diluted NAV per share are identical. The following reflects the net asset and share data used in the basic and diluted NAV per share computations: 31 December 31 December 2014 2013 £'000 £'000 Net assets attributable to ordinary shareholders (for calculation of EPRA NNNAV) 121,468 112,855 Financial derivative 284 (47) Adjusted net assets for calculation of EPRA NAV 121,752 112,808 Number of shares in issue 109,910,428 109,910,428 EPRA NNNAV (pps) 110.52 102.68 EPRA NAV (pps) 110.77 102.64 8. Interest bearing loans and borrowings 31 December 31 December 2014 2013 £'000 £'000 Initial loan transferred on the acquisition of Scape East on 20 May 2013 57,779 57,779 Part repayment of initial loan (32,645) (32,645) Further loan drawn down following acquisition of Ternion (Danehurst) Limited on 2 December 2013 13,500 13,500 Further loan drawn down following acquisition of Leopard Guernsey Greenwich JV Limited on 29 May 2014 1,366 1,366 Total loans drawn down 40,000 40,000 Loan arrangement fees (655) (655) Loan arrangement fees amortised to date 168 111 39,513 39,456 During the period, loans were drawn down under the Group's existing debt facility to the sum of £40 million. An initial loan of £57.7 million was transferred to the Company on the acquisition of Scape East on 20 May 2013, of which £32.6 million was repaid on 23 May 2013. An additional loan of £13.5 million was drawn down on 2 December 2013 to finance the acquisition of Ternion (Danehurst) Limited and a further loan of £1.4 million was drawn down on 29 May 2014 to cover the costs of acquisition in relation to Scape Greenwich. The facility is due to be fully repaid on 20 April 2019. At 31 December 2014, the interest rate on the loans of £25.1 million and £13.5 million was 2.558% (30 June 2014: 3.027%), with the interest rate on the loan of £1.4 million being 2.558% (30 June 2014: 3.004%). The Group uses gearing to enhance returns over the long term. The level of gearing is governed by careful consideration of the cost of borrowing and the Group uses hedging or otherwise seeks to mitigate the risk of interest rate increases. Gearing, represented by borrowings as a percentage of gross assets, will not exceed 55% at the time of investment. It is the Directors' current intention to target gearing of less than 30% of gross assets in the long term and to comply with the REIT condition relating to the ratio between the Group's `property profits' and `property finance costs'. The debt facility covenant includes loan-to-value and interest cover ratios that are measured at a Group level and the Group has maintained significant headroom against all measures throughout the financial period. The Group is in full compliance with the debt facility covenant at 31 December 2014. 9. Financial derivatives and hedging Hedged Pay Receive amount fixed 3M Valuation £'000 rate LIBOR Maturity £'000 Interest rate swap at fair value at 31 December 2014 20,000 1.441% 0.5578% 02/05/2017 (284) Interest rate swap at fair value at 30 June 2014 20,000 1.441% 0.4994% 02/05/2017 47 Cash flow hedges The Group has entered into interest rate swap contracts with notional amounts of £20 million whereby it pays a fixed rate of interest of 1.441% and receives a variable rate based on three-month LIBOR on the notional amount. The swap is used to hedge the exposure to the variable interest rate payments on the variable rate element of the Company's secured loans. Cash flows are expected to occur between the reporting date and May 2017 and will be recognised through profit or loss at that time. The fair value of the interest rate swap at the end of the reporting period was a liability of £284,000 (30 June 2014: asset of £47,000). Derivatives are classified in Level 2 in the fair value hierarchy under IFRS 13. 10. Fair value IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate the fair values. Cash and short-term deposits, trade receivables, trade payables, and other current liabilities approximate their carrying amounts due to the short-term maturities of these instruments. The fair values of the derivative interest rate swap contracts are estimated by discounting expected future cash flows using current market interest rate, yield curves and performance risk over the remaining term of the instrument. Valuation of investment property is performed by Knight Frank LLP, an accredited external valuer with recognised and relevant professional qualifications and recent experience of the location and category of the investment property being valued, however the valuations are the ultimate responsibility of the Directors. The valuation of the Company's investment property at fair value is determined by the external valuer on the basis of market value in accordance with the internationally accepted RICS Valuation - Professional Standards (incorporating the International Valuation Standards). The determination of the fair value of investment property requires the use of estimates such as future cash flows from assets (such as lettings, tenants' profiles, future revenue streams, capital values of fixtures and fittings, plant and machinery, any environmental matters and the overall repair and condition of the property) and discount rates applicable to those assets. In the Company's financial statements, investments in subsidiary companies which are 100% owned by the Company are valued at NAV. The following tables show an analysis of the fair values of financial instruments recognised in the balance sheet by level of the fair value hierarchy: 31 December 2014 Assets and liabilities measured at Level 1 Level 2 Level 3 Total fair value £'000 £'000 £'000 £'000 Investment properties - - 160,650 160,650 Financial derivatives - (284) - (284) Total - (284) 160,650 160,366 30 June 2014 Assets and liabilities measured at Level 1 Level 2 Level 3 Total fair value £'000 £'000 £'000 £'000 Investment properties - - 151,560 151,560 Financial derivatives - 47 - 47 Total - 47 151,560 151,607 Reconciliation of movements in Level 3 hierarchy: 31 December 30 June 2014 2014 Investment properties £'000 £'000 Valuation at the start of the period 151,560 - Acquisitions arising from business combinations - 53,550 Acquisition of property - 93,000 Fair value gains on revaluation of investment property 9,090 5,010 Valuation at the end of the period 160,650 151,560 Explanation of the fair value hierarchy: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2 - use of a model with inputs (other than quoted prices included in Level 1) that are directly or indirectly observable market data; and Level 3 - use of a model with inputs that are not based on observable market data. Sensitivity analysis to significant changes in unobservable inputs within Level 3 of the hierarchy. The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy of the Group's portfolio of investment property are: * ERV; * rental growth; * long-term vacancy rate; * discount rate/yield; and * specific to property under development: construction costs, lease up period, construction period and development profit. Significant increases/(decreases) in the ERV (per sqm per annum) and rental growth per annum in isolation would result in a significantly higher/(lower) fair value measurement. Significant increases/(decreases) in the long-term vacancy rate and discount rate (and exit or yield) in isolation would result in a significantly lower/(higher) fair value measurement. Generally, a change in the assumption made for the ERV (per sqm per annum) is accompanied by: * a similar change in the rent growth per annum and discount rate (and exit yield); and * an opposite change in the long-term vacancy rate. The following table analyses: * the fair value measurements at the end of the reporting period; * a description of the valuation techniques applied; * the inputs used in the fair value measurement, including the ranges of rent charged to different units within the same building; and * for Level 3 fair value measurements, quantitative information about significant unobservable inputs used in the fair value measurement. Fair value Valuation Key unobservable Range Class £'000 technique inputs Student £160,650 Income Market rent - £180-£340 per week property capitalisation 2014/15 Rental growth 2.5%-3% Tenancy period 51 weeks Sundry income £100 per bed per annum Facilities £1,800-£1,950 per bed per management cost annum Initial yield 5.76%-6% blended (5.25%-7.5%) Gains and losses recorded in profit or loss for recurring fair value measurements categorised within Level 3 of the fair value hierarchy amount to £9,090,000 and are presented in the income statement in line item `fair value gains on investment properties'. All gains and losses recorded in profit or loss for recurring fair value measurements categorised within Level 3 of the fair value hierarchy are attributable to changes in unrealised gains or losses relating to investment property held at the end of the reporting period. The carrying amount of the Company's assets and liabilities, except for investment properties, is considered to be the same as their fair value. 11. Financial risk management objectives and policies The Company's principal financial liabilities, other than derivatives, are loans and borrowings. The main purpose of the Company's loans and borrowings is to finance the acquisition of the Company's property portfolio. The Company has trade and other receivables, trade and other payables and cash and short-term deposits that arise directly from its operations. The Company is exposed to market risk, interest rate risk, credit risk and liquidity risk. The Board of Directors review and agree policies for managing each of these risks, which are summarised below. Market risk Market risk is the risk that the fair values of financial instruments will fluctuate because of changes in market prices. The financial instruments held by the Company are all fixed terms at fixed rates with the floating elements hedged on 50% of total borrowings. The Company's exposure to market risk is limited to the remaining 50% which is not hedged. Interest rate risk Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company's exposure to the risk of changes in market interest rates relates primarily to the Company's long-term debt obligations with floating interest rates. To manage its interest rate risk, the Group enters into interest rate swaps to hedge the exposure to floating rate movements. Credit risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Group is exposed to credit risk from its leasing activities and its financing activities, including deposits with banks and financial institutions and derivatives. Credit risk is managed by requiring tenants to pay rentals in advance. The credit quality of the tenant is assessed based on an extensive credit rating scorecard at the time of entering into a lease agreement. Outstanding tenants' receivables are regularly monitored. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial asset. The deposit account, cash and cash equivalents and the financial derivatives are held with Barclays which holds an A credit rating. Liquidity risk Liquidity risk is defined as the risk that the Group will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset. Exposure to liquidity risk arises because of the possibility that the Group could be required to pay its liabilities earlier than expected. The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of bank deposits and loans. 12. Related party transactions As defined by IAS 24 Related Party Disclosures, parties are considered to be related if one party has the ability to control the other party or exercise significant influence over the other party in making financial or operational decisions. Directors The Directors of the Company and subsidiaries are considered to be the key management personnel of the Group. Directors' remuneration for the period from 1 July 2014 to 31 December 2014 totalled £47,000 (period 26 February 2013 to 31 December 2013: £38,000) and the balance outstanding at 31 December 2014 was £12,000 (2013: £7,000). Investment Manager The Company is party to an Investment Management Agreement with the Investment Manager, pursuant to which the Company has appointed the Investment Manager to provide investment management services relating to the respective assets on a day-to-day basis in accordance with their respective investment objectives and policies, subject to the overall supervision and direction of the Board of Directors. For its services to the Company, the Investment Manager receives an annual fee at the rate of 1% of the NAV of the Company (or such lesser amount as may be demanded by the Investment Manager at its own absolute discretion). During the period from 1 July 2014 to 31 December 2014, the Group incurred £603,000 (period 26 February 2013 to 31 December 2013: £437,000) in respect of investment management fees and expenses and the balance outstanding at 31 December 2014 was £307,000 (2013: £175,000). 13. Financial information The financial information contained within this half-yearly report does not constitute full statutory accounts as defined in section 434 of the Companies Act 2006. The financial information for the periods ended 31 December 2014 and 31 December 2013 have not been audited or reviewed by the Company's Auditor. The latest published audited financial statements for the period ended 30 June 2014 have been delivered to the Registrar of Companies; the report of the independent Auditor thereon was unqualified and did not contain a statement under section 498 of the Companies Act 2006. The financial information for the period ended 30 June 2014 is an extract from those financial statements. GLOSSARY OF KEY TERMS AIF Alternative Investment Fund AIFM Alternative Investment Fund Manager AIFMD Alternative Investment Fund Managers' Directive BARCLAYS Barclays Bank PLC CISEA Channel Islands Securities Exchange Authority Limited COMPANY GCP Student Living plc COST OF BORROWING Cost of borrowing expressed as a percentage weighted according to period drawn down EPRA European Public Real Estate Association EPRA EPS Recurring earnings from core operational activities excluding movements relating to revaluation of investment properties and interest rate swaps and the related tax effects, divided by the number of shares in issue EPRA NAV EPRA net asset value - includes all property at market value but excludes the mark to market of interest rate swaps EPRA NNNAV As EPRA NAV but includes both debt and interest rate swaps carried at market value EPS Earnings per share ERV Estimated Rental Value GROUP GCP Student Living plc and its wholly-owned subsidiaries HEI Higher Education Institution HMRC HM Revenue & Customs IASB International Accounting Standards Board IFRS International Financial Reporting Standards IPO Initial Public Offering NAV Net asset value NOI MARGIN Net operating margin expressed as a percentage and calculated as operating profit less property operating costs NON-PID Ordinary UK dividend PID Property income distribution QMUL Queen Mary University of London REIT Real Estate Investment Trust RHUL Royal Holloway University of London RICS Royal Institution of Chartered Surveyors RPI Retail Price Index SCAPE Scape Student Living Limited - Asset Manager for Scape East and Scape Greenwich SFM Specialist Fund Market of the London Stock Exchange TOTAL SHAREHOLDER Share price growth with dividend deemed to be RETURN reinvested on the dividend date UCAS Universities and Colleges Admissions Service CORPORATE INFORMATION Directors Corporate website www.gcpuk.com/gcp-student-living-plc‎ Robert Peto (Chairman) Peter Dunscombe Stockbroker Malcolm Naish Cenkos Securities plc Investment Manager 6.7.8 Tokenhouse Yard London EC2R 7AS Gravis Capital Partners LLP Tel: 020 7397 1921 53-54 Grosvenor Street London W1K 3HU Solicitor Tel: 020 7518 1490 Wragge Lawrence Graham & Co LLP Secretary and registered office 4 More London Riverside London SE1 2AU Capita Company Secretarial Services Limited Principal banker 51 New North Road Exeter EX4 4EP Barclays Bank PLC Tel: 01392 477500 1 Churchill Place London E14 5HP Administrator Depositary Capita Sinclair Henderson Limited (Trading as Capita Asset Services) Langham Hall (UK) LLP Beaufort House Aldwych House 51 New North Road 81 Aldwych Exeter EX4 4EP London WC2B 4HN Auditor Registrar Ernst & Young LLP Capita Asset Services 1 More London Place The Registry London SE1 2AF 34 Beckenham Road Beckenham Valuer BR3 4TU Tel: 0871 664 0300 Knight Frank LLP email:shareholderenquiries@capita.co.uk 55 Baker Street www.capitaassetservices.com London W1U 8AN Frequency of NAV publication The Company's NAV is released to the London Stock Exchange on a quarterly basis and is published on the Company's website. Sources of further information Copies of the Company's annual and half-yearly reports, stock exchange announcements, investor reports and further information on the Company can be obtained from the Company's website. Key dates February Half-yearly results announced March Payment of second interim dividend June Company's year end Payment of third interim dividend September Annual results announced Payment of fourth interim dividend October Annual General Meeting December Company's half year end Payment of first interim dividend National Storage Mechanism A copy of the Half-Yearly Report and Financial Statements will be submitted shortly to the National Storage Mechanism ("NSM") and will be available for inspection at the NSM, which is situated at: www.morningstar.co.uk/uk/NSM Neither the contents of GCP Student Living plc's website nor the contents of any website accessible from hyperlinks on the website (or any website) is incorporated into, or forms part of this announcement.