australian education trust

AEU a Aust property Trust yielding 9.6%. Can anyone find a better yielding Aust LPT?
I can't, thus a ROARING BUY @ $1.35 imho!!!!!!!!!!!!!

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ASX RELEASE
28 February 2005
Australian Education Trust
Results for the half year ended 31 December 2004
The Directors of the responsible entity are pleased to be able to provide the results of the
Australian Education Trust (“Trust”) for the half year ended 31 December 2004.
The activities of the Trust were substantially changed on 22 December 2004 following
Unitholder approval to sell its childcare operating business to ABC Learning Centres
Limited (“ABC”) for a price of $42 million. The effect of the restructure has been to
remove a significant amount of the risk from the Trust’s earnings and convert it into a
simple property trust earning a fixed rental income stream.
As part of the restructure, the Unitholders also approved a change in the responsible
entity. BellRock Management Limited (“BellRock”), a subsidiary of BellRock Investments
Limited, now represents the interests of investors as the new responsible entity.
I
n the ASX release of 9 November 2004 the previous responsible entity advised that the
operational results of the centres were lower than expected and that one-off costs would
impact the results. In addition, the Trust did not make any property acquisitions during the
period to allow it to grow its earnings. These factors have resulted in the trust making an
after tax loss of $1.36 million.
Looking to the future the Directors do not believe that this result is a basis on which to
judge likely earnings. The restructure into a property trust provides a certainty of income
that the trust has not previously enjoyed. The remaining assets, predominantly
comprising freehold properties, are sound and the Trust now has a single quality tenant in
the form of ABC on attractive long-term leases. ABC’s recent results announcement
further emphasises the success of this organisation and the value to the Trust of the
arrangements into which it has entered.
I
n addition, as part of the restructure, the Trust negotiated significant rental support from
ABC over and above its normal rental income. This support will substantially underpin
income in the medium term as sustainable income grows organically and the Trust makes
property acquisitions to grow its profits to a level that match anticipated distribution levels.
Since taking over as responsible entity, BellRock has actively pursued property
acquisitions and is currently in various stages of negotiations on eight properties. In
addition, the Trust holds options over a further six. Low cost funding for acquisitions is
already available in the form of an amount of $27 million to be paid by ABC as part of the
proceeds from the sale of the operating business and the Trust’s long term debt facilities.
This will allow these acquisitions to be highly incremental to earnings. The Trust has
established a target of approximately 60 property acquisitions over the next year.















    


  
   
    
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Post the restructure, the name of the Trust was changed from the Peppercorn Investment
Fund to the Australian Education Trust signifying an intention to invest in assets in all
spheres of the education sector. While BellRock, with the assistance of ABC, is primarily
pursuing childcare assets for purchase, the future possibility of investing in a range of
assets within the wider educational sector represents an exciting opportunity for the
Trust.
A distribution of 5.5 cents per unit has been declared in line with previous market advices.
The distribution is not franked and represents a distribution of capital for tax purposes.
BellRock’s pre-tax forecast for the six months ended 30 June 2005 remains as previously
foreshadowed at 6.5 cents per unit.
The past six months has been a period of significant change for the Trust. However, the
Directors firmly believe that the restructure will provide solid ground upon which to grow
and allow the Trust to prosper in a relatively new property investment sector which is
growing in maturity.
Gordon Young
Director
BellRock Management Limited
AFSL No. 281544
For further information, please contact Mr. Gordon Young on 0417 305 554 or (03) 8601 2075.
(The documents attached to this release comprise the information required by ASX Listing Rule
4.2A and should be read in conjunction with the most recent annual financial report)