HALF YEARLY FINANCIAL REPORT for the Six Month Period to 30 September 2019

HALF YEARLY FINANCIAL REPORT For the six month period to 30 September 2019

12 November 2019

Hibernia REIT plc (“Hibernia”, the “Company” or the “Group”) today announces interim results for the six months to 30 September 2019. Highlights for the period:

Steady portfolio performance • Portfolio value of €1,423.7m1, up 0.6%2 in the period (active developments up 4.5%2) • Six-month total property return3 of 2.4% vs MSCI Ireland Property Index (excl. Hibernia) of 3.1% • EPRA NAV per share4 of 175.7 cent, up 1.4% in the period (March 2019: 173.3 cent)

Strong growth in distributable income from increasing rent roll and reduced costs • Annual contracted rent of €62.0m, up 7.6% since March 2019, mainly due to net new lettings and rent reviews • EPRA like-for-like net rental growth4 of 9.1% in the period • Net rental income of €28.6m, up 7.3% on the same period last year (September 2018: €26.6m) • Operating cost savings of €4.7m versus prior year period following expiry of IMA in November 2018 • EPRA EPS4 of 2.8 cent, up 55.6% on the same period last year (September 2018: 1.8 cent) • Interim dividend declared of 1.75 cent per share, up 16.7% on prior year (2018: 1.5 cent)

Further rental growth potential in the near term • Unlet space with ERV of €7.8m (March 2019: €8.0m): office vacancy of 12% by area (March 2019: 12%) • 2 Cumberland Place development due to complete in Q3 2020 (ERV: €3.2m) • Reversionary potential of portfolio of €1.1m with avg. period to capture of 2.6 years for in-place CBD offices

Disciplined capital allocation continues • Net sales proceeds in FY19 of €60.3m are being reinvested or returned to shareholders - €17.6m invested in five acquisitions, three of which were “bolt-on” in nature - €9.3m invested in capital expenditure on developments in the period - €25m share buyback launched in April 2019 and completed on 11 November 2019: 17.6m shares bought back and cancelled at an average price of 142.3 cent per share

Good progress with committed development and longer-term pipeline • 2 Cumberland Place expanded by 12% to 56,000 sq. ft. of new Grade A offices: Q3 2020 completion now expected • Longer-term pipeline being expanded and progressed and now comprises seven potential schemes - Provisional planning granted for 152,000 sq. ft. redevelopment of Clanwilliam Court, subject to appeal - Addition of Malahide Road: 3.8 acre industrial site with mixed-use potential in longer term

Robust balance sheet • Net debt4 at 30 September 2019 of €221.5m, LTV4 of 15.6% (March 2019: €217.1m, LTV4 15.6%) - Weighted average debt maturity at September 2019 of 4.8 years (March 2019: 5.4 years) • Significant funding capacity: cash and undrawn facilities of €173.5m, €133.3m net of committed expenditure

Improving sustainability performance • Three star GRESB rating in 2019, with score +17pp on prior year • Full-time Sustainability Manager joining in January 2020

Tax changes announced in Budget 2020 and effective 9 October 2019 (post period end) • Increase in stamp duty on commercial property transactions from 6% to 7.5%: if effective as at 30 September 2019 it would have reduced portfolio value by an estimated €22m and EPRA NAV per share by an estimated 3.3 cent • For details on the other changes and their potential impact, please see the Financial Review section of this release

1. The Group plans to move to a new head office in 1WML in late 2019. During the period fit-out work has commenced on this space and therefore it has been recognised as owner occupied property in the condensed consolidated financial statements. The space currently occupied by the Group in South Dock House has been leased to a tenant from December 2019 (signed on 30 September 2019) so when the Group relocates, this space will be transferred to investment property. These transfers are recognised at fair value on the date of transfer 2. On a like-for-like basis 3. Total property return is the return of the property portfolio (capital and income) as calculated by MSCI 4. An alternative performance measure (“APM”). The Group uses a number of such financial measures to describe its performance, which are not defined under IFRS and which are therefore considered APMs. In particular, measures defined by EPRA are an important way for investors to compare similar real estate companies. For further information see supplementary information at the end of this announcement

Kevin Nowlan, Chief Executive Officer of Hibernia, said:

“We have made good progress in the first half of the financial year, with net new lettings and rent reviews enabling us to increase our contracted rent roll by 8% to €62m, and EPRA earnings growing by 50% versus the same period last year. With €11m of potential incremental rent (per our independent valuer) to come from leasing the remaining available space in the existing portfolio and our 2 Cumberland Place development, there is a significant opportunity for us to grow our income further in the near term and this remains a high priority for us.

“We are also working hard to unlock the value within our development pipeline, with the key achievements in the period being the grant of planning to expand our 2 Cumberland Place scheme and the preliminary planning permission received for the redevelopment of Clanwilliam Court, which is subject to appeal. In addition, we have made a number of small bolt-on acquisitions, expanding and improving our pipeline.

“Whilst Ireland continues to have one of the fastest growing economies in the EU, business and consumer sentiment have softened in recent months, consistent with global trends. We have also seen some evidence of smaller occupiers deferring decisions on leasing space given the current geopolitical uncertainty. Nonetheless, overall tenant demand for offices and apartments in Dublin remains high and job creation from foreign direct investment is near record levels.

“It remains to be seen how the Irish property investment market reacts to the tax changes announced by the Government in the recent Budget. Our business has low leverage, a talented team and an exciting pipeline of potential development projects and we are well-positioned to take advantage of whatever opportunities arise.”

Contacts: Hibernia REIT plc +353 1 536 9100 Kevin Nowlan, Chief Executive Officer Tom Edwards-Moss, Chief Financial Officer

Murray Consultants Doug Keatinge: +353 86 037 4163, [email protected] Jill Farrelly: +353 87 738 6608, [email protected]

About Hibernia REIT plc Hibernia REIT plc is an Irish Real Estate Investment Trust ("REIT"), listed on Euronext Dublin and the London Stock Exchange. Hibernia owns and develops property and specialises in Dublin city centre offices.

The results presentation will take place at 8.30 a.m. today, 12 November 2019: a conference call facility will be available to listen to the presentation live using the following details:

Ireland dial-in: +353 (0)1 431 1252 UK dial-in: +44 (0)3 333 000 804 US dial-in: +1 (0)1 631 913 1422 All other locations: +44 (0)3 333 000 804 Access Code: 19145447#

Disclaimer This announcement contains forward-looking statements, which are subject to risks and uncertainties because they relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Group or the industry in which it operates, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements speak only as at the date of this announcement. The Group will not undertake any obligation to release publicly any revision or updates to these forward-looking statements to reflect future events, circumstances, unanticipated events, new information or otherwise except as required by law or by any appropriate regulatory authority.

MARKET REVIEW General economy While Ireland’s economy is expected to be one of the fastest growing in the euro area in 2019 and foreign direct investment (“FDI”) remains strong, it is not immune from the global economic backdrop of slowing growth as concerns around trade and geopolitics persist: Goodbody now expects core domestic demand to grow 3.6% in 2019 and 3.2% in 2020, down from 4.5% and 3.7%, respectively, when we reported in May 2019.

Irish GDP growth is forecast at 4.0% in 2019 and 2.8% in 2020 versus 1.2% and 1.4% for the euro area, respectively (source: Goodbody), helped by continuing low levels of unemployment, which stood at 4.8% at October 2019 (source: the Central Statistics Office (“CSO”)), consumer spending and growth in exports. FDI in Ireland continues to be strong: 8,175 IDA- sponsored jobs have been created in the first nine months of 2019, up 10% on the same period last year and, at the current run rate, 2019 looks set to be another record year for FDI job creation in Ireland (source: Goodbody, IDA). Employment in Dublin remains buoyant with the latest data from the CSO (Q2 2019) showing that there are 717,000 people employed, up from 695,000 a year earlier. The unemployment rate in Dublin at Q2 2019 was 4.4%, down from 5.3% a year earlier. Despite these strong fundamentals, recent economic data indicates activity is slowing and investment decisions are being delayed: Ireland’s composite PMI (Purchasing Managers’ Index) reading for October 2019 was 50.6, down from the 2018 average of 57.1 but still in expansionary territory (i.e. above 50) (source: Markit Economics / Bloomberg). Recent statistics released by the CSO also indicate a slowdown in core investment which, as Goodbody notes, is likely to stem mainly from the uncertainty around the UK’s departure from the EU (“Brexit”): core investment grew by 1% year-on-year in Q2 2019 having been as high as 15% year-on-year in Q2 2018 (source: Goodbody). The recent rapid growth in the Irish economy and employment is eroding already limited spare capacity (source: CBI) and increasing the risks of wage inflation and a loss of competitiveness. Pay increases of 3.7% in 2019 and 4.1% in 2020 are expected versus overall inflation expectations of 0.8% and 1.1%, respectively (source: CBI). In the construction sector tender prices grew by 3.4% in the first half of 2019, largely as a result of rising labour and material costs (source: SCSI).

The CBI identifies Brexit as the most material external risk to Irish growth alongside risks in relation to international trade, taxation and a slowdown in the global economy. Given the uncertainty around how Brexit will unfold, growth forecasts for the Irish economy are subject to a high margin of error with both large downside and upside risks. In light of this, the Irish Government has taken a cautious approach and based its recent Budget 2020 on the assumption of a “no-deal” Brexit, estimating that GDP would fall to 0.7%, investment would fall by 24% and unemployment would increase to 5.7%. (Goodbody, Department of Finance). As part of Budget 2020, the Irish Government announced that stamp duty on commercial property transactions would increase from 6.0% to 7.5%, which is estimated to have a one-off negative impact of around 1.5% on commercial property values as it will increase purchasers’ costs by the same amount (see further details on the tax changes in the Financial Review section).

Irish property investment market In the 12 months to 30 September 2019 the MSCI Ireland Property Index All Benchmark excluding Hibernia (the “Index”) delivered a total return of 6.3% (September 2018: 6.9%). Over this period the industrial sector was the top performer with a total return of 10.0% followed by the office sector at 7.4% and “other” - which includes multi-family residential or private rental stock (“PRS”) - at 3.8% (September 2018: 8.8%, 7.9% and 12.2%, respectively). Yields have remained broadly constant in the office sector since late 2017, with the agent consensus between 4.00% and 4.25%, while PRS yields are currently between 3.85% and 4.00% and are trending tighter (source: Cushman & Wakefield, CBRE).

Total investment spend in the first nine months of the year was €3.0bn and, with a number of transactions in the pipeline including the sale of Green REIT, the market is on track to exceed last year’s record of €3.6bn by some margin (source: JLL). Dublin continues to be the principal location within Ireland for investment, accounting for 88% of volumes in the first nine months of the year, up from 84% in the same period last year (source: Knight Frank). Residential and office assets continue to dominate, accounting for 40% and 34%, of volumes respectively in the period (September 2018: 30% and 40%, respectively) (source: Knight Frank). These two sectors are expected to continue to represent the majority of investment volumes given demand for prime Dublin offices and residential assets, particularly from international investors (source: JLL). It is estimated that there was €3.0bn of demand for Dublin office investments and €4.0bn for residential investments as at 30 September 2019 (source: Knight Frank) though it remains to be seen whether this demand will be impacted by the recent tax changes announced as part of Budget 2020.

Top 10 office investment transactions (nine months to September 2019) Building Price Price (psf) Buyer Buyer nationality 5 Hanover Quay €197.0m €1,233 Union Investment Germany Nova Atria €165.0m €465 Mapletree Investments Singapore Vestas Investment Charlemont Exchange €144.0m €1,171 South Korea Management Citywest Portfolio €105.0m n/a Henley Bartra UK & Ireland The One Building €49.5m €1,100 BNP REIM France 77 Sir John Rogerson's Quay €35.5m €1,040 Patrizia Germany 51-54 Pearse Street/Magennis Place €27.2m €635 IPUT Ireland The Lennox Building €27.0m €806 Swiss Life Switzerland Ballast House €26.9m €951 Union Investment Germany 23 Shelbourne Road €25.3m €976 U+I UK Top 10 total €802.4m Source: Knight Frank

Office occupational market With large occupiers continuing to be active, 2019 is on track to be another strong year in the office letting market following two consecutive years of record take-up: 2018 saw 3.9m sq. ft. of leasing transactions and 2017 had 3.6m sq. ft. of transactions. For the first nine months of 2019 take-up stood at 2.1m sq. ft., which compares to 2.2m sq. ft. at the same point last year (source: Knight Frank), and there are 1m-1.6m sq. ft. of letting deals in the pipeline (source: Knight Frank, CBRE) which, if all converted in Q4 2019, would bring the total lettings in 2019 above 3m sq. ft. for the third year in a row. However, we have seen some evidence of smaller occupiers deferring leasing decisions given the recent geopolitical uncertainty and the statistics reflect this: in the first nine months of 2019 take-up of space in the sub-20k sq. ft. market was 0.6m sq. ft. compared to the five-year average for first nine months of each year of 0.9m sq. ft. (source: Knight Frank). The city centre continues to account for the majority of take-up, representing 52% of lettings by area in the first nine months, down from 66% in the same period in 2018 (source: Knight Frank). Net take-up was 64% of the headline figure in the period (September 2018: 75%), suggesting underlying occupier growth remains robust (source: Knight Frank).

Top 10 Dublin office lettings (nine months to September 2019) % of total Tenant Industry Building Area (sq. ft.) take-up Salesforce TMT Spencer Place, D1 430k 21% Central Bank State 4 & 5 Dublin Landings, D1 201k 10% OPW State The Distillers Building, D8 182k 9% Facebook TMT Nova Atria, Sandyford 174k 9% Docusign TMT 5 Hanover Quay, D2 99k 5% Paddy Power Other Belfield Office Park, Co. Dublin 90k 4% Elavon TMT Cherrywood Business Park, D18 68k 3% VHI Insurance Hampstead Building, Carrickmines, D18 58k 3% OPW State Bishops Square, D2 47k 2% Genesis Aviation Finance Block I, Central Park, D18 25k 1% Top 10 total 1,374k 66% Source: Knight Frank

The technology, media and telecommunications (“TMT”) sector remains the biggest source of demand, accounting for 44% of take-up in the first nine months of the year, up from 39% in the same period last year, followed by Irish state bodies at 24% (September 2018: 11%). Co-working and serviced office providers comprised 4% of take-up in the first nine months of 2019, down from 14% in the same period last year (source: Knight Frank). Overall, co-working and serviced office providers account for approximately 3.4% of the city centre stock (excl. period properties), up from 2.9% at March 2019 (source: Knight Frank). This compares to London at 6.0%, New York at 3.7% and Paris at 3.0% (source: Hibernia/Knight Frank). WeWork is by far the largest serviced office provider in Dublin at present with c. 500k sq. ft. of accommodation, more than twice that of its nearest competitor, which has 230k sq. ft. of accommodation.

The overall Dublin office vacancy rate at September 2019 was 6.8%, up from 5.4% at March 2019 (September 2018: 6.7%). The Grade A vacancy rate in the city centre where all of Hibernia’s office portfolio is located was 6.0% at September 2019, up from 4.5% at March 2019 (September 2018: 5.3%) as a result of a large lease surrender and following some leased space

4 coming back to the market for sub-lets (source: Knight Frank). Prime city centre rents are stable at above €60psf (source: JLL, Knight Frank, CBRE). Looking ahead, active demand remains strong at 4.1m sq. ft. at the end of September 2019, in line with March 2019 at 4.2m sq. ft. but down from 5.3m sq. ft. in September 2018 (source: Cushman & Wakefield).

Office development pipeline The table below sets out our expectations for upcoming supply across Dublin’s city centre and for the whole of Dublin by year. We expect a total of 8.4m sq. ft. of gross new space between 2019 and 2022, of which 62% will be in the CBD.

Year City centre supply All Dublin supply 2019f 0.8m sq. ft. (72% pre-let) 1.5m sq. ft. (57% pre-let) 2020f 1.7m sq. ft. (42% pre-let) 2.3m sq. ft. (35% pre-let) 2021f 1.1m sq. ft. (22% pre-let) 2.1m sq. ft. (40% pre-let) 2022f 1.6m sq. ft. (5% pre-let) 2.5m sq. ft. (3% pre-let) Total expected 2019-22 5.2m sq. ft. 8.4m sq. ft. Source: Knight Frank/Hibernia

The pre- and mid-letting market continues to be active, with 38% of office stock under construction in Dublin (37% in the city centre) having been let or reserved as at November 2019 (source: Knight Frank/Hibernia).

Residential sector Housing delivery is increasing, with 9,185 new homes delivered nationally in the first half of 2019 according to the CSO (versus 7,867 in H1 2018) and 33% of these delivered in the Dublin area (38% in H1 2018). When combined with the commuter counties around Dublin, the Greater Dublin Area (“GDA”) accounted for 55% of completions in H1 2019 (56% in H1 2018). According to Goodbody’s BER Housebuilding Tracker, housing completions grew strongly in Q3 2019 to 6,200 units, up 34% year-on-year. This would imply total completions to September 2019 of approximately 15,400 units and would be on track to modestly exceed Goodbody’s forecast for the full year of 21,000 units but still well below the estimated annual requirement of approximately 35,000 – 40,000 units in order to meet demand (source: Goodbody). House price inflation has moderated somewhat, standing at 2% annually at August 2019 on a national basis and -0.3% annually in Dublin.

Despite Ireland 2040’s aspirations for compact, urban growth there has been a surge in housebuilding in the commuter belt (up 57% year-on-year) while completions in Dublin grew by just 9% year-on-year in Q3 2019 (source: Goodbody). One of the reasons for this is that the delivery of apartments in Dublin, particularly at affordable levels, remains challenging. Apartment delivery increased by 78% year-on-year in Q3 2019 to 1,100 units and 35% of all units completed in Dublin in H1 2019 were apartments, up from 23% in H1 2018 (source: CSO). However, as Goodbody notes, “given the costs of apartment delivery, viability appears only to be achieved in the higher-priced markets of Dublin, resulting in a sprawl of lower density housing outside the capital”. Overall, there remains an excess of new homes at higher price ranges when compared to the number of people who can afford to buy them and, conversely, a deficit at more affordable prices (source: Goodbody). Notwithstanding these challenges, the fundamentals for housing remain strong with growing disposable incomes and net inward migration supportive of ongoing demand (source: Goodbody). Mortgage lending also continues to grow, and new lending is expected to increase 13% year-on-year in 2019. However, affordability issues remain to the fore due to the Central Bank’s macroprudential rules which limit mortgages to 3.5x income.

Despite increases in supply and a moderation in growth in capital values, there remains a large amount of international and domestic institutional capital looking to invest in the residential sector, particularly in the private rented sector (“PRS”). CBRE’s research earlier this year suggests that as much as €6.3bn is now targeting the sector in Ireland, up from €5.3bn a year earlier, and Knight Frank estimates that €4.0bn is targeting Dublin. While not impacted by the increase in stamp duty, unlike commercial property, it remains to be seen if this demand is impacted by the wider tax changes announced in Budget 2020.

BUSINESS REVIEW Disposals and acquisitions It has been a quieter period of investment activity for the Group with €17.6m invested in five smaller acquisitions,(€16.4m excluding transaction costs), many of which are adjacent to existing Hibernia assets and were “bolt-on” in nature, and no disposals made. Since period end, we have invested a further €1.4m in one acquisition (incl. transaction costs).

Disposals • None.

Acquisitions • Malahide Road Industrial Park, D17: the property, which was acquired in July 2019 for €7.8m, including transaction costs, comprises 66,000 sq. ft. of warehousing and 17,000 sq. ft. of ancillary office accommodation on a 3.8 acre site. The property is occupied by Bunzl Irish Merchants on a lease expiring in early 2020 and is generating rent of €0.4m per annum. In the longer term we believe it has potential for a mixed-use development (see further details in the developments and refurbishments section below). • Other: during the period €9.8m was spent on four small acquisitions, most of which provide potential synergies with properties already owned by Hibernia.

Acquisitions after period end • 136 A&B Slaney Close, D11: contracts have been exchanged to acquire two industrial units for €1.4m (incl. transaction costs). These units adjoin 129 Slaney Road, a property already owned by Hibernia. This acquisition increases Hibernia’s total contiguous land holding in Dublin Industrial Estate from 3.8 acres to 4.5 acres. In the longer term we believe this land has potential for a mixed-use development (see further details in the developments and refurbishments section below).

Portfolio overview As at 30 September 2019 the property portfolio consisted of 34 investment properties valued at €1,424m (March 2019: 32 investment properties valued at €1,395m), which can be categorised as follows:

Value as at September 2019 Passing rent Contracted rent ERV 1 (all assets) % of portfolio Equivalent yield €’m €’m €’m

1. Dublin CBD offices

Traditional Core €441m 31% 5.0%2 €23.3m €23.3m €24.1m

IFSC €206m 14% 4.7% €8.3m €8.3m €11.2m

South Docks €540m3 38% 4.5% €14.4m4 €22.8m €27.5m

Total Dublin CBD offices €1,187m 83% 4.7%2 €46.0m €54.3m €62.8m

2. Dublin CBD office development5 €22m 2% – – – €3.2m

3. Dublin residential6 €155m 11% 3.9%7 €6.1m10 €6.1m10 €7.3m11

4. Industrial/ land €60m 4% 2.4%8 €1.5m €1.6m €1.5m

Total €1,424m 100% 4.5%2,7,8,9 €53.5m10 €62.0m €74.8m12 1. Yields on unsmoothed values and excluding the adjustment for South Dock House and 1WML owner-occupied space 2. Harcourt Square, Clanwilliam Court & Marine House yields are calculated as the passing rent over the total value (after costs) which includes residual land value. Excludes Iconic Offices in Clanwilliam Court 3. Excludes the value of space to be occupied by Hibernia in 1WML 4. HubSpot on rent free at Sep-19. Total rent €6.8m 5. 2 Cumberland Place 6. Includes 1WML residential element (Hanover Mills) 7. Net yields assuming 80% net-to-gross and purchaser costs as per C&W at September 2019 8. Current rental value assumed as ERV as these assets are valued on a price per acre basis except for Slaney Road which is valued on an income basis 9. Excludes. all CBD office developments 10. Residential rent on a net basis 11. Net ERV assuming 80% net to gross (as per valuer assumptions) 12. Note: differences in summation of totals is due to rounding

The key statistics for the office element of our portfolio, which comprised 83% by value and 88% by contracted rent at 30 September 2019 (March 2019: 85% and 88%, respectively), are set out below: contracted rent from completed developments now comfortably exceeds that from our acquired in-place offices.

% of rent % of rent % of next Contracted WAULT to WAULT to MTM2 at ERV upwards rent review rent review 1 break/expiry next only cap & collar lease event Acquired in- €25.9m €26.7m place office 2.6yrs 3.7yrs 17% – 83% (€46psf) (€47psf) portfolio

Completed €28.4m €28.6m office 3.2yrs 9.8yrs – 25% 75% (€54psf) (€54psf) developments3

Whole in-place €54.3m €55.4m 2.9yrs 6.9yrs 8% 13% 79% office portfolio (€50psf) (€51psf)

Vacant in-place €7.4m – – – – – – office (€50psf)

Committed €3.2m – – – – – – office-unlet (€56psf)4

Whole in-place €66.0m office portfolio – – – – – – (€51psf) (after vacancy)

1. To earlier of review or expiry 2. Mark-to-market 3. 1 Cumberland Place, SOBO Works, 1&2DC, 1WML, 2WML, 1SJRQ 4. 2 Cumberland Place

Increasing portfolio income and extending unexpired lease terms continue to be key priorities. Since 31 March 2019 we have added €4.4m to Group contracted rent through:

• Four new leases/licence agreements and one variation to an existing lease adding €2.3m, with weighted average term certain for the new leases of c.5.3 years • Nine rent reviews concluded adding €2.7m • Two new acquisitions adding €0.5m to contracted rent • Lease expiries and breaks reducing contracted income by €1.1m The in-place office portfolio vacancy rate was 12% by lettable area at 30 September 2019 (31 March 2019: 12%): for further details on the vacant space and the increase in contracted rent, please refer to the asset management section below.

Portfolio performance In the six months ended 30 September 2019 the portfolio value increased €9m or 0.6% on a like-for-like basis (i.e. excluding acquisitions, disposals and capital expenditure). Had the 1.5% increase in stamp duty on Irish commercial property transactions announced in the 2020 Budget on 8 October 2019 been effective from 30 September 2019, the Group’s valuer estimates the negative impact on the portfolio value would have been €22m, meaning the portfolio value would have decreased €13m or -0.9% on a like-for like basis in the six month period (see further details in the Financial Review below). In the six months ended 31 September 2018 the portfolio value increased by €21.2m or 3.9% on a like-for-like basis.

Value at Value at Value at September September 2019 March 2019 2019 (pro forma (all assets) Capex Acquisitions 1 Disposals Revaluation (all assets) stamp duty) L-f-L change 1. Dublin CBD offices Traditional core €444m €1m €1m – (€5m) €441m €430m (€5m) (1.2%)

IFSC €207m – – – – €206m €203m – –

South Docks €522m2 €4m €7m (€5m)3 €11m €540m3 €533m3 €12m3 2.3%3

Total Dublin CBD offices €1,173m €5m €8m (€5m) €6m €1,187m3 €1,166m3 €7m3 0.6%3

2. Dublin CBD office development €16m €5m – – €1m €22m €21m €1m 4.5%

3. Dublin residential €153m – €1m – €1m €155m €155m €1m 0.5%

4. Industrial/ land €53m – €9m – (€2m) €60m €60m – 0.1%

Total €1,395m €10m €18m (€5m) €6m €1,424m3 €1,402m3 €9m3 0.6%3

1. Including acquisition costs 2. Excludes the value of space occupied by Hibernia in South Dock House but Sep-19 includes reclassification of 1SJRQ and 2WML as CBD offices from office development 3. During the period fit-out commenced on the space in 1WML of Hibernia’s new head office from late 2019 and it is therefore recognised as owner occupied property in the financial statements. The space currently occupied by the Group in South Dock House has been leased to a tenant from Dec-19 (signed Sep-19). Upon Hibernia’s head office relocating, this space (in SDH) will be transferred to investment property. These transfers are recognised at fair value on the date of transfer. For the purpose of the above table, the transfer is a deemed disposal and the subsequent transfer of SDH to investment property will be a deemed purchase for the year ending Mar-20. The “like-for-like” columns in the above table ignore the deemed disposal of the 1WML space since it was part of investment property at Mar-19.

The key individual valuation movements in the period were:

• Observatory, South Docks: €4.2m/5% uplift driven by the new licence agreement with N3 at a rent ahead of the March 2019 estimated rental value (“ERV”) and the settlement of an outstanding rent review in line with ERV • 2WML, South Docks: €3.6m/6% uplift as a result of leasing the 1st floor (13,000 sq. ft.) to Udemy significantly ahead of ERV. The headline market rent across the entire building increased from €55.19psf to €56.58psf and the equivalent yield compressed by 15bps from 4.85% to 4.65% on the let space • 1WML, South Docks: €2.4m/2% uplift as a result of the headline market rent on the office space increasing by €1psf to €57.06psf • Hardwicke & Montague House, D2: €1.8m/2% uplift as a result of the majority of the rent reviews being settled, all at or ahead of ERV, and the average headline market rent increasing marginally from €52.86psf to €53.86psf • The Forum, IFSC: -€1.9m/-4% movement as a result of higher expected capital expenditure on the property prior to leasing. The ERV and yield assumptions remain the same as March 2019 • Marine House, D2: -€4.5m/-15% movement largely as a result of higher capital expenditure estimates for the development works as a result of design improvements, preparatory work for the Clanwilliam redevelopment and cost inflation, with no corresponding increase in value

Developments and refurbishments No schemes were completed in the period and one scheme, 2 Cumberland Place, remained in progress. Capital expenditure on developments amounted to €9.3m (September 2018: €20.1m). The pipeline of future schemes was expanded with the acquisition of the property at Malahide Road and there was progress on planning at Clanwilliam Court.

Committed development schemes At 2 Cumberland Place, D2, we have received planning permission for an extra floor, adding 6,500 sq. ft. of office space and a 2,000 sq. ft. terrace and taking the overall building to 56,000 sq. ft. of office accommodation. The construction work continues: the concrete cores are now in place and the steel frame is being erected. As a result of the additional floor, completion is now expected to occur in Q3 2020 (previously H1 2020) and capital expenditure is expected to be €35m (previously €30m).

Please see further details on the scheme below:

Est. total Full cost Expected practical Total area post purchase Est. (incl. Office completion (“PC”) Sector completion (sq. ft.) price capex land) ERV1 ERV1 date 56k office 2 Cumberland Place Office 1k retail/café €0m €35m €621psf2 €3.2m €56.20psf Q3 2020 56k office Total committed 1k retail/café €0m €35m €621psf2 €3.2m €56.20psf 1. Per C&W valuation at 30 September 2019 2. Office demise only

At 30 September 2019 Cushman & Wakefield, the Group’s independent valuer, had an average estimated rental value for the unlet office space (103,000 sq. ft.) in 2WML and 2 Cumberland Place of €56.57psf and was assuming an average yield of 4.80% upon completion: based on these assumptions C&W expects a further €12m of development profit (excluding finance costs) to be realised through the completion and letting of these schemes. A 25-basis point movement in yields across the properties would make c. €6m difference to the development profits, and a €2.50psf change in estimated rental value (“ERV”) would result in a c. €5m difference. If current market conditions prevail, we would expect these yields to tighten once the buildings are completed and/or let.

Development pipeline The office pipeline remains broadly unchanged from March 2019, with the potential to deliver up to an estimated 538,000 sq. ft. of Grade A office space upon completion (a net increase over current areas of 260,000 sq. ft.), the majority of which would be in two clusters of office buildings at Clanwilliam Court/Marine House and Harcourt Square. We have received a provisional grant of planning for the 152,000 sq. ft. redevelopment scheme at Clanwilliam Court, though this is subject to appeal.

The quantity of land owned with potential for mixed-use development schemes in the long term increased to 151.3 acres (March 2019: 147.5 acres) with the acquisition of a 3.8 acre industrial site at Malahide Road. Re-zoning will be necessary in all cases and so the timing of any future developments is uncertain at present.

Area post Full Current area completion purchase Office Sector (sq. ft.) (sq. ft.) price1 Comments • Planning granted for 49k sq. ft. refurbishment / extension • Lower ground floor application may add approx. 1.5k sq. ft. Marine House Office 41k 49k €29m • Vacant possession expected during 2020 • Redevelopment opportunity post 2021 • Potential to add significantly to existing NIA across • all three blocks and create an office cluster similar to Windmill Quarter (with Marine) Blocks 1, 2 & 5 141k office • Provisional planning received for 152k sq. ft. Clanwilliam Court Office 93k 11k ancillary €55m redevelopment – subject to appeal • Leased to OPW until December 2022 • Site offers potential to create cluster of office buildings with shared facilities or a major HQ • Planning granted for 309k sq. ft 307k office • Detailed building assessment underway by Harcourt Square Office 122k 2k retail €75m development team • Current planning permission for two extra floors (6k sq. ft.), expiring July 2021 One Earlsfort • Potential for redevelopment as part of wider Terrace Office 22k 28k €20m Earlsfort Centre scheme Total office 278k 538k €179m Mixed-use • Strategic transport location Newlands Logistics / • Potential for future mixed-use redevelopment (Gateway) land 143.7 acres n/a €48m2 subject to re-zoning

• Strategic transport location 62k on • Potential for future mixed-use development 129 Slaney Road Logistics 3.8 acres n/a €5m subject to re-zoning 66k warehouse & 17k ancillary office on 3.8 • Potential for future mixed-use development Malahide Road Logistics acres n/a €8m subject to re-zoning Total mixed-use 151.3 acres n/a €61m 1. Including transaction costs and capex spent to date 2. Initial consideration

Asset management Net capital expenditure on maintenance items amounted to €0.3m in the period (September 2018: €0.1m). Contracted rent increased by 8% to €62.0m (March 2019: €57.6m) as a result of:

• New lettings/licence agreements and variations to existing leases adding €2.3m; • Rent reviews concluded adding €2.7m; • Acquisitions adding €0.5m; and • Lease expiries and surrenders reducing contracted rent by €1.1m

At 30 September 2019 one office rent review was active, with a modest (<€0.5m) uplift in contracted rent expected, and the vacancy rate in the office portfolio was 12%, based on lettable area (March 2019: 12%).

Summary of letting activity in the period Offices: • Three new lettings on 31,000 sq. ft. and one license agreement, generating a total of €2.2m per annum of incremental new rent. The weighted average periods to break and expiry for the new leases were 5.1 years and 9.0 years, respectively • Nine rent reviews concluded over 99,000 sq. ft., adding a further €2.7m of rent per annum: in aggregate the revised rents were approximately 98% above the previous contracted rents and 2% ahead of the ERV at the time of review

Retail: • One new letting of 2,000 sq. ft. at an initial rent of €0.1m per annum

Residential: • 293 of the Group’s 331 apartments are located in Dundrum and average rents achieved in new lettings in the period by the Group for two-bed apartments in Dundrum were €1,864 per month vs average two-bed passing rents of €1,854 per month • Letting activity and lease renewals at Dundrum generated incremental gross annual rent of <€0.1m in the period (new leases signed on 38 apartments and leases renewed on 42 apartments) • All let units are subject to the rental cap regulations

Key asset management highlights 1SJRQ, South Docks The lease to HubSpot of all 112,000 sq. ft. of office accommodation at an annual rent of €6.8m commenced in June 2019. We have let the Dockers pub to L’Estrange Group on a long lease at an initial rent of €0.1m per annum for the 2,000 sq. ft. demise. We remain in discussions with food and beverage operators regarding the remaining 6,000 sq. ft. of retail space in the building.

2WML, South Docks We have let one floor (13,000 sq. ft.) to Udemy, an online learning platform, on a five year lease with three years term certain. The lease commenced in September 2019 and the initial rent payable is €0.8m per annum, materially ahead of the estimated rental value for the space at March 2019, in part due to the shorter term. Discussions continue with potential occupiers for the remaining 47,000 sq. ft. of available office accommodation.

50 City Quay, South Docks We are working on plans for the refurbishment of the 4,500 sq. ft. office building which has a prominent river-fronting position next to 1SJRQ.

Cannon Place, D4 Following the completion of necessary remedial works the 16 units are being furnished for re-letting.

Central Quay, South Docks Substantially all 27,500 sq. ft. of vacant space in the building is under offer from potential occupiers.

The Forum, IFSC All 47,000 sq. ft. of office accommodation and 50 car parking spaces were vacated by the former tenant in March 2019 (which had been paying a rent of €2.0m per annum). We are continuing discussions with interested parties as we consider options for the building.

Hardwicke House & Montague House, D2 Six of the seven rent reviews outstanding in the buildings at 31 March 2019 have now been settled. The reviews covered 58,000 sq. ft. and resulted in an aggregate €1.6m increase (+97%) in the passing rent to €3.3m per annum. One rent review over 23,500 sq. ft. remains outstanding.

Marine House, D2 Two rent reviews over 4,300 sq. ft. of ground floor office space were settled, increasing the passing rent by €0.1m per annum.

The Observatory, South Docks Riot Games exercised a break option on part of its demise and vacated 8,000 sq. ft. in July 2019 as expected. This space has been taken by N3, an international sales and marketing firm, on a three year, managed office contract which commenced in October 2019. Under the terms of the agreement N3 has taken the space fully-fitted (“plug and play”) and Hibernia expects to generate net income after costs of €0.6m per annum. One rent review over 36,000 sq. ft. was concluded in the period resulting in a €1.0m (99%) uplift in the passing rent on the demise.

South Dock House, South Docks We have agreed to let all 9,500 sq. ft. to an Irish plc on a long lease which is expected to commence in late 2019. Currently part of the property is occupied by Guggenheim and part is the Hibernia head office. We have commenced fit-out of the ground floor suite in 1WML and our head office will relocate there in late 2019.

Flexible workspace arrangement The flexible workspace arrangement with Iconic Offices (“Iconic”) in 21,000 sq. ft. of Block 1, Clanwilliam Court is performing well, with all workstations (c. 90% of revenue from the arrangement) occupied and 84% of the available co-working memberships contracted at 30 September 2019.

Other completed assets The remaining completed properties in the portfolio remain close to full occupancy.

Sustainability As set out in our Sustainability Report published in June 2019 (see www.hiberniareit.com/sustainability for more details), we are making good progress in improving our sustainability performance. Further evidence for this has come from the awards we have received in the six months to September 2019: as well as receiving an EPRA Gold award for the quality of our sustainability performance disclosures for a second successive year, we received three stars in the Global Real Estate Sustainability Benchmark (“GRESB”) 2019 Assessment, improving our score by 17 percentage points over prior year. To ensure we continue to improve in all aspects of sustainability we have recruited a full-time Sustainability Manager who will join us in January 2020.

FINANCIAL REVIEW As at 30 September 2019 31 March 2019 Movement IFRS NAVPS 175.9c 174.7c +0.7% EPRA NAVPS1 175.7c 173.3c +1.4% Net debt1 €221.5m €217.1m +2.0% Group LTV1 15.6% 15.6% - Financial period ended 30 September 2019 30 September 2018 Movement Profit before tax for the period €25.5m €64.0m -60.1% EPRA earnings1 €19.3m €12.8m +50.1% IFRS EPS 3.7c 9.2c -59.8% Diluted IFRS EPS 3.7c 9.2c -59.8% EPRA EPS 1 2.8c 1.8c +55.6% Interim DPS1 1.75c 1.5c +16.7%

1. An alternative performance measure (“APM”). The Group uses a number of such financial measures to describe its performance, which are not defined under IFRS and which are therefore considered APMs. In particular, measures defined by EPRA are an important way for investors to compare similar real estate companies. For further information see “supplementary information” at the end of this report.

The key drivers of EPRA NAV per share, which increased by 2.4 cent from 31 March 2019, were: • 0.9 cent per share from the revaluation of the property portfolio, including 0.1 cent per share in relation to development properties • 2.8 cent per share from EPRA earnings in the period • Other items, primarily the share buy-back, increased NAV by 0.7 cent • Payment of the FY19 final dividend, which reduced NAV by 2.0 cent per share

EPRA earnings were €19.3m, up 50.1% compared to the same period in the prior year as a result of: • A €2.0m increase in net rental income (+7.3%) to €28.6m (September 2018: €26.6m). This was principally due to the commencement of the office lease in 1SRJQ in June 2019 and the successful completion of a number of rent reviews and came in spite of the sales of New Century House and 77 Sir John Rogerson’s Quay in the prior year and the cessation of the office lease in the Forum in March 2019 • A €4.7m reduction in operating expenses (-44.9%) to €5.8m (September 2018: €10.4m): the reduction over the same period in prior year was mainly as a result to the expiry of the Investment Management Agreement in November 2018. The Group’s new remuneration scheme commenced from the same date

Profit before tax was €25.5m, a reduction of 60.1% over the same period last year, mainly because of higher revaluation gains in the financial period last year. The prior period saw significant yield compression within the residential sector and 1SJRQ benefitted from a change in valuation approach as it neared practical completion. Funding position Group leverage target: our through-cycle leverage target remains 20-30%.

The table below summarises our debt funding: the weighted average maturity of the Group’s debt at 30 September 2019 was 4.8 years (March 2019: 5.4 years). We refinanced the Group’s facilities in December 2018, moving to an unsecured structure, extending the weighted average maturity date and introducing non-bank funding for the first time in the form of private placement notes. The Group’s overall interest costs under the new funding arrangements remained broadly unchanged due to a reduction in the undrawn commitment fee payable on the new revolving credit facility (“RCF”).

Instrument Quantum Maturity date Interest cost Security Revolving credit facility (five year) €320m December 2023 2.0% over EURIBOR on drawn funds Unsecured 0.8% comm’t fee (fixed) on undrawn funds Private placement notes (seven year) €37.5m January 2026 2.36% coupon (fixed) Unsecured Private placement notes (ten year) €37.5m January 2029 2.69% coupon (fixed) Unsecured Total €395m N/a N/a N/a

As at 30 September 2019, net debt was €221.5m (March 2019: €217.1m), equating to a loan to value ratio (“LTV”) of 15.6% (March 2019: 15.6%). The key capital items impacting net debt in the period were total capital expenditure of €10.7m, the share buyback of €19.0m and acquisition expenditure of €17.6m which were partially offset by the receipt of €35.3m from the sale of 77SJRQ, which was contracted to be sold in FY ‘19.

Cash and undrawn facilities as at 30 September 2019 totalled €173.5m or €133.3m net of committed expenditure (March 2018: €178m and €143m, respectively). Assuming full investment of the available facilities in property, the LTV, based on property values at 30 September 2019, would be c. 25%. Interest rate hedging Group hedging policy: to ensure the majority of the interest rate risk on drawn debt balances is fixed or hedged.

As at 30 September 2019 the Group had €75m of fixed coupon private placement notes and the interest rate risk on the RCF drawings of €166.6m was mitigated by €225m of hedging instruments comprising:

Instrument Notional Strike rate Exercise date Effective date Termination date Cap €100m 1% N/a November 2017 November 2019 Swaption €100m 1% November 2019 November 2019 November 2021 Cap €125m 0.75% N/a February 2019 December 2021 Swaption €125m 0.75% December 2021 December 2021 December 2023

While the Group was “over-hedged” on its interest rate exposure at 30 September 2019, this did not give rise to any additional financial risk to the Group and ceased on 11 November 2019 when the cap and swaption over €100m of notional debt expired. Had these instruments expired on 30 September 2019, 75% of the interest rate risk on the RCF drawings would have been hedged at that date and 83% of the Group’s interest rate risk on its debt would have been fixed or hedged. Dividend Group dividend policy: to distribute 85-90% of recurring rental profits via dividends each financial year, with the interim dividend in a financial year usually representing 30-50% of the total ordinary dividends paid in respect of the prior financial year.

Consistent with its policy that the interim dividend will represent 30-50% of the total ordinary dividends paid in respect of the prior financial year, the Board has declared an interim dividend of 1.75 cent per share (2018: 1.5 cent), an uplift of 16.7%. This represents 63% of the EPRA earnings per share for the period and 50% of the ordinary dividends per share paid in respect of the financial year ended 31 March 2019.

The interim dividend will be paid on 23 January 2020 to shareholders on the register at 3 January 2020. All of the dividend will be a Property Income Distribution (“PID”) in respect of the Group’s property rental business as defined under the Irish REIT legislation.

Hibernia’s Dividend Reinvestment Plan (“DRiP”) is available to shareholders and allows them to instruct Link, the Group’s registrar, to reinvest the dividends paid by Hibernia into the purchase of shares in the Company. The terms and conditions of the DRiP and information on how to apply are available on the Group’s website. Capital management In April 2019 we announced the sale of 77SJRQ and our intention to return the net proceeds of €35m to shareholders to maintain the Group’s progress towards the lower end of our stated 20-30% target, starting with an on-market share buyback programme of €25m which commenced the same month. As at 30 September 2019 13.3m shares had been repurchased and cancelled under this buyback programme for aggregate consideration of €19.0m (an average purchase price of €1.43 per share). The €25m buyback programme completed on 11 November 2019, at which point 17.6m shares had been repurchased and cancelled at an average price of €1.42 per share.

In our preliminary results in May 2019 we announced our intention to undertake a capital reorganisation to enhance our flexibility for future capital management through converting a substantial part of our share premium account, which had a balance of €624.5m at 31 March 2019, into distributable reserves. This was approved by shareholders at the Annual General

Meeting in July 2019 and the final court hearing to approve the capital reorganisation has been deferred until January 2020 by which time there is expected to be greater clarity on the tax changes detailed below. Tax changes announced in Budget in October 2019 In the 2020 Budget (and the subsequent Finance Bill) the Irish Government announced a number of changes to the taxation of Irish property which can be categorised into those that directly impact the Group (whether immediately or potentially at some point in future) and those that do not. We summarise these changes below and estimate the impact for the Group where possible and/or appropriate. At present the Finance Bill is still subject to review and possible amendment: the final Finance Act is expected to be signed in December 2019.

Main tax changes directly impacting the Group Overview Type of change Effective from Impact for Hibernia Stamp duty increased from 6% to 7.5% on Market change 9 October 2019 • Cushman & Wakefield, the Group’s valuer, all commercial property transactions in (unless a binding estimates that this change would have Ireland contract was in reduced the value of the Group’s portfolio place before this at 30 September 2019 by 1.6% (€22m) had date and it it been effective at that date completes by 31 • This is equates to a proforma 1.8% (3.3c) December 2019) reduction in the Group’s NAV per share at 30 September 2019 Increase in the rate of dividend withholding Market change 1 January 2020 • The change affects shareholders directly tax (“DWT”) from 20% to 25% for all • The impact will vary depending on the dividends paid by Irish companies individual circumstances of each shareholder and whether relief is available under a tax treaty Where an entity ceases to be a REIT, there REIT change 9 October 2019 • No immediate change for the Group will no longer be a deemed disposal and • If Hibernia ceased to be a REIT before the reacquisition of the assets at market value, expiry of the 15 year period (i.e. before unless the REIT has been in existence for 15 December 2028), this means the original years or more. tax basis in the assets would apply to subsequent disposals, not the market value at the date of cessation. • This could create latent tax for any bidder and reduce the price it would be prepared to pay to acquire the Group 85% of any proceeds a REIT generates from REIT change 9 October 2019 • No immediate impact the sale of a rental property which are not • Longer term impact uncertain until full reinvested within a three year window terms of this change are clear (spanning one year before and two years afterwards) or distributed to shareholders within two years of sale (and thus subject to DWT) will be taxed at 25% (an effective rate of 21.25% on the proceeds)

Tax changes not directly impacting the Group Irish Real Estate Investment Funds (“IREFs”): anti-avoidance rules have been introduced for IREFs. Broadly these seek to counteract perceived aggressive tax planning by some IREFs by disincentivising the use of high levels of debt and excessive costs as a means of reducing profits liable to IREF tax. While the changes do not directly impact the Group, with almost €17bn of property held within IREF structures at the end of 2017 (source: Central Bank of Ireland) any changes which negatively impact IREFs may indirectly affect the wider property market.

Schemes of arrangement: stamp duty on corporate acquisitions undertaken by a scheme of arrangement increased to 1% (previously 0%).

SELECTED PORTFOLIO INFORMATION 1. Summary EPRA measures Six months ended Six months ended EPRA performance measure Unit 30 September 2019 30 September 2018 EPRA earnings €’000 19,284 12,849

EPRA EPS cent 2.8 1.8

Diluted EPRA EPS cent 2.8 1.8

EPRA cost ratio - including direct vacancy costs % 23.3% 42.5%

EPRA cost ratio - excluding direct vacancy costs % 22.1% 41.1%

EPRA performance measure Unit As at 30 September 2019 As at 31 March 2019 EPRA net initial yield (“NIY”) % 3.6% 3.6%

EPRA “topped-up” NIY % 4.2% 4.1%

EPRA net asset value (“EPRA NAV”) €’000 1,212,516 1,219,374

EPRA NAV per share cent 175.7 173.3

EPRA triple net assets (“EPRA NNNAV”) €’000 1,203,540 1,218,539

EPRA NNNAV per share cent 174.4 173.2

Like-for-like rental growth % 9.1% 7.6%

EPRA vacancy rate % 10.8% 10.7%

2. Top 10 in-place office occupiers by contracted rent and % of contracted in-place office rent roll Top 10 tenants € ’m % Sector 1 HubSpot Ireland Limited 10.5 19% TMT 2 The Commissioners of Public Works 6.0 11% Government Agency 3 Twitter International Company 5.1 9% TMT 4 Autodesk Ireland Operations 2.8 5% TMT 5 Informatica Ireland EMEA 2.1 4% TMT 6 Riot Games 2.0 4% TMT 7 Electricity Supply Board 1.9 4% Government Agency 8 Travelport Digital Limited 1.8 3% TMT 9 BNY Mellon 1.6 3% Banking and capital markets 10 ComReg 1.6 3% Government Agency Top 10 total 35.4 65% Rest of portfolio 18.9 35% Total contracted “in-place” office rent 54.3 100%

3. In-place office contracted rent by tenant business sector Sector € 'm % Technology, media & telecoms 28.8 53% Government 10.3 19% Banking & capital markets 7.1 13% Professional services 4.2 8% Insurance & reinsurance 1.6 3% Other 1.2 2% Serviced offices 1.1 2% Total 54.3 100%

4. In-place office contracted rent and WAULT progression Movement Movement Sep-18 to Mar-19 Mar-19 to Sep-19 Sep-19 All office contracted rent1,3 €54.0m -7% €50.4m +8% €54.3m In-place office contracted rent1,3 €47.3m +7% €50.4m +8% €54.3m In-place office WAULT2 7.1yrs +6% 7.5yrs -8% 6.9yrs In-place office vacancy3 3% +9pp 12% - 12% 1. Excl. arrangement with Iconic Offices at Block 1 Clanwilliam 2. To earlier of break or expiry 3. By net lettable office areas. Office area only (i.e. excl. retail, basement, gym, Townhall etc.)

PRINCIPAL RISKS AND UNCERTAINTIES There are a number of risks and uncertainties which could have a significant impact on the Group’s performance and could cause actual results to differ materially from expected results. The Directors consider that the principal risks and uncertainties to the Group, which are set out on pages 40 to 49 of the 2019 Annual Report, are substantially unchanged for the remaining six months of the financial year. These risks and uncertainties are summarised, together with a short update where relevant, below.

Market risks: under-performance of Dublin property market / weakening economy / adverse Brexit outcome The Budget 2020 announced in early October 2019 introduced a number of changes to the taxation of Irish property including REITs (see Financial Review and/or see note 33 of the condensed consolidated financial statements for further details). These included an increase in the rate of stamp duty on Irish commercial property transactions from 6% to 7.5% which took effect from 9 October 2019 and is expected to have a one-off negative impact on the Group’s portfolio value of approximately 1.6% or €22m. It remains to be seen if the taxation changes (some of which are still subject to possible amendment) will have an impact on the Irish property investment market. While Ireland’s economy is expected to be one of the fastest growing in the euro area in 2019 and foreign direct investment (“FDI”) remains strong, it is not immune from the global economic backdrop of slowing growth: Goodbody now expects core domestic demand to grow 3.6% in 2019 and 3.2% in 2020, down from 4.5% and 3.7%, respectively, when we reported in May 2019. Irish GDP growth is forecast at 4.0% in 2019 and 2.8% in 2020 (source: Goodbody). The Central Bank of Ireland (“CBI”) identifies Brexit as the most material external risk to Irish growth alongside risks in relation to international trade, taxation and a slowdown in the global economy. WAULT stands at 6.9 years for the whole office portfolio, protecting against vacancy risks in a market downturn and we continue to focus on reducing vacancy and extending lease terms.

Investment risks: mis-timed investment or sale / inappropriate concentration on assets, locations, tenants or tenant sectors These risks are largely unchanged. The Group’s portfolio was worth 1.4 billion at 30 September 2019 and comprised 34 properties, the largest being 11% of the portfolio by value (31 March 2019: 11%). The Group has invested €17.6m in a number of smaller acquisitions, mainly adjacent to existing Group assets, in the six months ending 30 September 2019. No disposals took place in the period. The office portfolio’s top 10 tenants account for 65% of Group office portfolio contracted rent, the TMT sector accounts for 53% of contracted office rent and the single largest tenant is HubSpot, accounting for 19% of contracted office rent.

Development risks: poor or mistimed execution of development projects / contractor default / adverse outcome at Newlands Construction cost inflation is still estimated to be mid to high single digit percent per annum and this is likely to impact the profitability of future developments. The Group uses fixed rate contracts to remove cost inflation risk during the construction phase. The Group has a highly experienced internal development team and partners with contractors with 16 proven track records which also helps to mitigate construction risks, including the risks of breaching building standards. As at 30 September 2019 the Group had one committed scheme, totalling 56k sq. ft. of offices which is scheduled for completion in the second half of 2020 (calendar year). Other risks around contractor default and Newlands remain largely unchanged.

Asset management risks: poor asset management / failure to react to evolving tenant needs The Group continues to work to implement improvements in asset and building management and this risk remains stable. Achieving high sustainability and environmental standards is a focus and we believe it is increasingly important in attracting tenants and investors. The Group has recruited a dedicated Sustainability Manager who will join in January 2020. The Group completed its second GRESB assessment during the period and has made significant progress in most areas, with a 17 percentage point increase in its performance, and was awarded three stars. Reacting to changing tenant requirements the Group signed two relatively small shorter leases in the period with terms of three and five years, respectively with appropriate rental premium to reflect the shorter term.

Finance risks: inappropriate capital structure or lack of available funding The Group remains modestly geared: at 30 September 2019 the Group’s loan to value ratio was 15.6% or 15.8% proforma the stamp duty increase in October 2019 (31 March 2019: 15.6%). Committed capital expenditure in the next 18 months is expected to increase the LTV ratio to c.18%. At 30 September 2019 the Group had cash and undrawn facilities totalling €174m, or €133m net of committed expenditure (31 March 2019: €178m or €143m, respectively), and on average 4.8 years until the maturity of its debt facilities. The Group continues to move towards the lower end of its 20-30% leverage target and its €25m share buyback completed on 11 November 2019.

People risks: Loss of key staff and / or motivation Staff turnover was 8.8% in the first half of the financial year on total headcount of 34 and the senior team remained stable. The new Remuneration Policy has been fully implemented and the first LTIP awards were granted during the period. This risk is not expected to change materially for the remaining six months of the financial year.

Regulatory, tax and political risks: adverse changes or failure to comply with legislation including the REIT regime It is possible that there is a general election in Ireland in the next six months, which may result in a change of government. As mentioned above, Budget 2020 increased the rate of stamp duty on Irish commercial property transactions from 6% to 7.5% which is expected to have a one-off negative impact on commercial property values with effect from early October 2019. There were a number of other changes made to the taxation of Irish property, including REITs and the impact of these on the property market is uncertain: please see Financial Review section and/or note 33 to the condensed consolidated financial statements for further information.

Business interruption risks: adverse external event No significant incidents occurred during the period and these risks are not expected to materially change in the remaining six months of the financial year.

Directors’ Responsibilities Statement Each of the Directors, whose names appear on page 60 of this report, confirm to the best of their knowledge that the condensed consolidated financial statements in the Half Yearly Financial Report have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting as adopted by the European Union (“EU”), give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group and the half year management report herein contains a fair review of the information required by Disclosure and Transparency Rules of the Central Bank of Ireland, namely:

• Regulation 8(2) of the Transparency Directive (Directive 2004/109/EC) Regulations 2007, being an indication of important events that have occurred during the period from 1 April 2019 to 30 September 2019 and their impact on the half yearly financial report, and a description of the principal risks and uncertainties for the remaining six months of the financial year; and • Regulation 8(3) of the Transparency Directive (Directive 2004/109/EC) Regulations 2007, being related party transactions that have taken place during the period from 1 April 2019 to 30 September 2019 and that have materially affected the financial position or performance during the period.

Signed on behalf of the Board

Kevin Nowlan Thomas Edwards-Moss Chief Executive Officer Chief Financial Officer 11 November 2019 17

INDEPENDENT REVIEW REPORT TO HIBERNIA REIT PLC We have been engaged by the Company to review the interim financial information included in the Half Yearly Financial Report for the six months ended 30 September 2019 which comprise the condensed consolidated statement of financial position as at 30 September 2019 and the related condensed consolidated income statement, condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity, condensed consolidated statement of cash flows, and the related notes 1 to 33 for the six-month period then ended (“interim financial information”). We have read the other information contained in the Half Yearly Financial Report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial information.

This report is made solely to the Company in accordance with International Standard on Review Engagements 2410 “Review of Interim Financial Information Performed by the Independent Auditor of the Entity” (“ISRE 2410”) issued by the International Auditing and Assurance Standards Board. Our work has been undertaken so that we might state to the Company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this review report, or for the conclusions we have formed.

DIRECTORS’ RESPONSIBILITIES The Half Yearly Financial Report is the responsibility of, and has been approved by, the Directors. The Directors are responsible for preparing the Half Yearly Financial Report which includes the interim financial information, in accordance with the International Accounting Standard 34, ‘‘Interim Financial Reporting,’’ as adopted by the European Union and the Transparency (Directive 2004/109/EC) Regulations 2007,and the Transparency Rules of the Central Bank of Ireland.

As disclosed in note 2, the annual financial statements of the Company are prepared in accordance with IFRSs as adopted by the European Union. The interim financial information included in this Half Year Financial Report has been prepared in accordance with International Accounting Standard 34 “Interim Financial Reporting” as adopted by the European Union.

OUR RESPONSIBILITY Our responsibility is to express to the Company a conclusion on the interim financial information in the Half-Yearly Financial Report based on our review.

SCOPE OF REVIEW We conducted our review in accordance with ISRE 2410. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

CONCLUSION Based on our review, nothing has come to our attention that causes us to believe that the interim financial information in the Half Yearly Financial Report for the six months ended 30 September 2019 is not prepared, in all material respects, in accordance with the International Accounting Standard 34, ‘‘Interim Financial Reporting,’’ as adopted by the European Union and the Transparency (Directive 2004/109/EC) Regulations 2007, and the Transparency Rules of the Central Bank of Ireland.

Christian MacManus For and on behalf of Deloitte Ireland LLP Chartered Accountants and Statutory Audit Firm Deloitte & Touche House, Earlsfort Terrace, Dublin 2

Date: 11 November 2019

Condensed consolidated income statement For the six months ended 30 September 2019

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Revenue 5 33,717 30,656 61,387 Rental income 5 29,749 28,134 56,027 Property operating expenses 5 (1,171) (1,502) (2,718) Net rental and related income 5 28,578 26,632 53,309 Gains and losses on investment property 7 6,288 51,131 98,105 Other gains and (losses) 8 (28) 34 140 34,838 77,797 151,554 Operating expenses Administration expenses 9 (5,753) (7,603) (13,890) IMA performance-related payments – (2,841) (5,401) Total operating expenses (5,753) (10,444) (19,291) Operating profit 29,085 67,353 132,263 Finance income 3 17 5 Finance expense 11 (3,589) (3,407) (8,226) Net finance expense (3,586) (3,390) (8,221) Profit before income tax 25,499 63,963 124,042 Income tax 26 (3) (583) Profit for the period 25,525 63,960 123,459

EPRA earnings for the period 13 19,284 12,849 27,472 Earnings per share Basic earnings per share (cent) 13 3.7 9.2 17.8 Diluted earnings per share (cent) 13 3.7 9.2 17.6 EPRA earnings per share (cent) 13 2.8 1.8 4.0 Diluted EPRA earnings per share (cent) 13 2.8 1.8 3.9

Condensed consolidated statement of comprehensive income For the six months ended 30 September 2019

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Profit for the period 25,525 63,960 123,459 Other comprehensive income, net of income tax Items that will not be reclassified subsequently to profit or loss: Gain on revaluation of land and buildings 16 627 100 723 Items that may be reclassified subsequently to profit or loss: Net fair value gain/(loss) on hedging instruments entered into for cashflow hedges 22.b (59) (48) 41 Total other comprehensive income 568 52 764 Total comprehensive income for the period attributable to owners of the Company 26,093 64,012 124,223

Condensed consolidated statement of financial position As at 30 September 2019

30 September 2019 31 March 2019 unaudited audited Notes €'000 €’000 Assets Non-current assets Investment property 15 1,423,737 1,395,418 Property, plant and equipment 16 12,524 5,902 Other assets 17 534 – Other financial assets 19 11 194 Trade and other receivables 20 9,275 7,928 Total non-current assets 1,446,081 1,409,442 Current assets Trade and other receivables 20 6,133 40,164 Cash and cash equivalents 18 25,327 22,372 31,460 62,536 Non-current assets classified as held for sale 17 – 534 Total current assets 31,460 63,070 Total assets 1,477,541 1,472,512 Equity and liabilities Capital and reserves Share capital 21 68,896 69,759 Share premium 21 630,276 624,483 Capital redemption reserve 21 1,327 – Other reserves 22 3,337 9,157 Retained earnings 23 507,786 515,140 Total equity 1,211,622 1,218,539 Non-current liabilities Financial liabilities 24.a 238,613 231,048 Deferred tax liabilities 25 547 547 Total non-current liabilities 239,160 231,595 Current liabilities Financial liabilities 24.a 508 507 Trade and other payables 26 23,823 19,863 Contract liabilities 27 2,428 2,008 Total current liabilities 26,759 22,378 Total equity and liabilities 1,477,541 1,472,512 IFRS NAV per share (cent) 14 175.9 174.7 Diluted IFRS NAV per share (cent) 14 175.5 173.2 EPRA NAV per share (cent) 14 175.7 173.3

Condensed consolidated statement of changes in equity For the six months ended 30 September 2019 (unaudited)

Capital Property Share-based Share premium redemption revaluation Cashflow hedge payment Retained Share capital reserve reserve reserve reserve reserve earnings Total €'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000 Balance at 1 April 2018 69,235 617,461 – 1,166 (329) 8,783 415,414 1,111,730 Profit for the period – – – – – – 63,960 63,960 Other comprehensive income for the period – – – 100 (48) – – 52 69,235 617,461 – 1,266 (377) 8,783 479,374 1,175,742 Issue of share capital 524 7,022 (7,546) (14) (14) Dividends paid – – – – – – (13,254) (13,254) Share-based payments provided – – – – – 3,792 – 3,792 Balance at 30 September 2018 69,759 624,483 – 1,266 (377) 5,029 466,106 1,166,266 Profit for the period – – – – – – 59,499 59,499 Other comprehensive income for the period – – – 623 89 – – 712 69,759 624,483 – 1,889 (288) 5,029 525,605 1,226,477 Issue of share capital – – – – – – – – Dividends paid – – – – – – (10,465) (10,465) Share-based payments provided – – – – – 2,527 – 2,527 Balance at 31 March 2019 69,759 624,483 – 1,889 (288) 7,556 515,140 1,218,539 Profit for the period – – – – – – 25,525 25,525 Other comprehensive income for the period – – – 627 (59) – – 568 69,759 624,483 – 2,516 (347) 7,556 540,665 1,244,632 Issue of share capital 464 5,793 – – – (6,257) (15) (15) Capital redeemed (1,327) – 1,327 – – – (18,979) (18,979) Dividends paid – – – – – – (13,885) (13,885) Share-based payments – – – – – (131) – (131) Balance at 30 September 2019 68,896 630,276 1,327 2,516 (347) 1,168 507,786 1,211,622

Condensed consolidated statement of cash flows For the six months ended 30 September 2019

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Cash flows from operating activities Profit for the period 25,525 63,960 123,459 Adjusted for: Gain on sales of investment property – (2,397) (2,578) Other gains and losses 12 – (140) Cash-settled share-based payments 10 (319) – (339) Finance expense 3,586 3,390 8,221 Non-cash movements 28.a (5,931) (42,567) (85,359) Operating cash flow before movements in working capital 22,873 22,386 43,264 (Increase)/decrease in trade and other receivables (2,017) 1,225 (961) (Decrease)/increase in trade and other payables 4,611 (928) (447) Increase in contract liabilities 420 540 263 Net cash inflow from operating activities 25,887 23,223 42,119 Cash flows from investing activities Cash expended on investment property 28.b (28,663) (32,669) (86,847) Cash received from sales of investment property 28.c 34,639 64,962 64,016 Purchase of fixed assets 28.d (130) (49) (52) Cash received from loans repaid – – 170 Tax 69 – – Income on other assets – 8 122 Finance income 3 17 5 Finance expense (3,203) (2,929) (9,546) Net cash flow inflow/(outflow) by investing activities 2,715 29,340 (32,132) Cash flow from financing activities Dividends paid 12 (13,885) (13,254) (23,719) Share buy-back 21 (18,979) – – Borrowings drawn 24.a 37,200 22,500 340,412 Borrowings repaid 24.a (29,968) (30,000) (326,372) Derivatives premium paid – – (443) Share issue costs (15) (14) (14) Net cash (outflow) from financing activities (25,647) (20,768) (10,136) Net (decrease)/increase in cash and cash equivalents 2,955 31,795 (149) Cash and cash equivalents at start of financial period 22,372 22,521 22,521 (Decrease)/increase in cash and cash equivalents 2,955 31,795 (149) Net cash and cash equivalents at end of financial period 18 25,327 54,316 22,372

Notes to the condensed consolidated financial statements Section 1 – General The accounting conventions and accounting policies employed in the preparation of these condensed consolidated financial statements are consistent with those employed in the preparation of the most recent annual consolidated financial statements in respect of the year ended 31 March 2019 as described in the Annual Report and referenced in this document as appropriate except as noted below.

The Group adopted IFRS 16 for the first time in these condensed consolidated financial statements. There was no material impact on these interim results or on the financial position as at 1 April 2019. These condensed consolidated financial statements do not include all the information and disclosures required in the annual consolidated financial statements and should therefore be read in conjunction with the Group’s Annual Report in respect of the year ended 31 March 2019.

1. General Information

Hibernia REIT plc, the “Company”, registered number 531267, together with its subsidiaries and associated undertakings (the “Group”), is engaged in property investment and development (primarily office) in the Dublin market with a view to maximising its shareholders’ returns.

The Company is a public limited company and is incorporated and domiciled in Ireland. The address of the Company’s registered office is South Dock House, Hanover Quay, Dublin, D02 XW94, Ireland.

The Ordinary Shares of the Company are listed on the primary listing segment of the Official List of Euronext Dublin and the premium listing segment of the Official List of the UK Listing Authority and are traded on the regulated markets for listed securities of Euronext Dublin and the London Stock Exchange plc.

2. Basis of preparation a. Statement of compliance and basis of preparation The annual financial statements of Hibernia REIT plc have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, which comprise standards and interpretations approved by the International Accounting Standards Board (IASB). IFRS as adopted by the EU differ in certain respects from IFRS as issued by the IASB. These condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting as adopted by the EU. The interim figures for the six months ended 30 September 2019 are unaudited but have been reviewed by the independent auditor, Deloitte Ireland LLP , whose report is set out on page 18 of this report. The summary financial statements for the year ended 31 March 2019 that are presented in the condensed consolidated financial statements represent an abbreviated version of the full financial statements for that year on which the independent auditor, Deloitte Ireland LLP , issued an unqualified audit report and are not annexed to these financial statements. The half yearly financial statements herein are non-statutory financial statements for the purposes of the Companies Act 2014. The Group has not early adopted any forthcoming IASB standards (Note 3). The consolidated financial statements of the Group for the year ended 31 March 2019 (“the Annual Report 2019”) are available upon request from the Company Secretary or from www.hiberniareit.com. The financial statements for the financial year ended 31 March 2019 have been filed in the Companies Registration Office. These condensed consolidated financial statements were approved for issue by the Board of Directors on 11 November 2019. b. Alternative performance measures The Group uses alternative performance measures to present certain aspects of its performance. These are explained and, where appropriate, reconciled to equivalent IFRS measures in the Supplementary Information section at the back of these condensed consolidated financial statements. The main alternative performance measures used are those issued by the European Public Real Estate Association (“EPRA”) which is the representative body of the listed European real estate industry. EPRA issues guidelines and benchmarks for reporting both financial and sustainability measures. These are important in allowing investors to compare and measure the performance of real estate companies across Europe on a consistent basis. EPRA earnings and EPRA NAV are presented within the condensed consolidated financial statements and fully reconciled to IFRS as these two measures are among the key performance indicators for the Group’s business. c. Functional and presentation currency These condensed consolidated financial statements are presented in euro, which is the Company’s functional currency and the Group’s presentation currency. d. Basis of consolidation The condensed consolidated financial statements incorporate the condensed consolidated financial statements of the Company and entities controlled by the Company (its subsidiaries). The accounting policies of all consolidated entities are consistent with the Group’s accounting policies. All intragroup assets and liabilities, equity, income, expenses and cashflows relating to transactions between members of the Group are eliminated in full on consolidation. e. Assessment of going concern The condensed consolidated financial statements have been prepared on a going concern basis. The Directors have performed an assessment of going concern for a minimum period of 12 months from the date of signing of these condensed consolidated financial 23 statements and are satisfied that the Group is appropriately capitalised. The Group has a cash balance as at 30 September 2019 of €25.3m (31 March 2019: €22m), is generating positive operating cashflows and, as discussed in note 24.a, has in place debt facilities with average maturity of 4.8 years and an undrawn balance of €153m at 30 September 2019 (31 March 2019: €161m). The Group has assessed its liquidity position and there are no reasons to expect that the Group will not be able to meet its liabilities as they fall due for the foreseeable future. f. Significant judgements The preparation of the condensed consolidated financial statements may require management to exercise judgement in applying the Group’s accounting policies. The following are the significant judgements and key estimates used in preparing these condensed consolidated financial statements: Fair value Fair value is 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, regardless of whether that price is directly observable or estimated using another valuation technique. In calculating the fair value of an asset or liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. In valuing an investment property, the Group must judge the property’s highest and best use, which may not necessarily be the current use. For example, it may be decided that older properties, nearing the end of their current lease arrangements, may be better used by either significant refurbishment or demolition and rebuilding. The valuation techniques applied to the properties depend on their use, and results may vary significantly, therefore the Group’s judgement as to the appropriate valuation basis for these properties is considered by the Directors to be significant in preparing financial statements. Fair value for measurement and/or disclosure purposes in these condensed consolidated financial statements is determined on such a basis, except for share-based transactions that are within the scope of IFRS 2 (see note 10 for more details), leasing transactions that are within the scope of IFRS 16, and measurements that have some similarities to fair value but are not fair value such as value in use in IAS 36. Valuation basis of investment property (note 15) All investment properties are valued in accordance with their current use, which is also the highest and best use except for: • Harcourt Square, Marine House and Clanwilliam Court Blocks 1, 2 and 5 where, in accordance with IFRS 13:27, the valuations take into account the redevelopment potential upon expiry of the current leases which reflects the highest and best use. It is the Directors’ intention to pursue the redevelopment of these properties when the existing leases have expired. These are valued on an investment basis until the end of the leases and on a residual basis thereafter. • Gateway, which is currently partly rented on short-term leases, has been valued on a price per acre basis as early stage plans are in place to redevelop this property in future and this approach reflects the highest and best use of this property. • Malahide Road Industrial Park, which is currently partly rented on short-term leases, has been valued on a basis that includes recognition of its potential as a development site. Block 3 Wyckham Point and Hanover Mills: both properties are held for long-term property rental purposes and were developed on this basis. VAT was payable on the acquisition (in the case of Block 3 Wyckham Point only) and on the construction costs for both schemes which has been treated as irrecoverable and recognised as part of the capital costs of both projects. If either property is sold within five years of completion, the Group would be obliged to charge VAT on the sale but would be entitled to a recovery of the VAT incurred on the construction and acquisition costs on an apportioned basis according to the VAT life of the building. As neither property is intended to be sold within the five-year period, in the opinion of the Directors, no amendment to the valuer’s valuation of either asset was deemed necessary. g. Analysis of sources of estimation uncertainty Valuation of investment property The Group’s investment properties are held at fair value and were valued at 30 September 2019 by the external valuer, Cushman and Wakefield (“C&W”), a firm employing qualified valuers in accordance with the appropriate sections of the Professional Standards (“PS”), the Valuation Technical and Performance Standards (“VPS”) and the Valuation Applications (“VPGA”) contained within the RICS Valuation – Global Standards 2017 (“the Red Book”). It follows that the valuations are compliant with the International Valuation Standards ("IVS"). Further information on the valuations and the sensitivities is given in note 15. The Board conducts a detailed review of each property valuation to ensure that appropriate assumptions have been applied. Property valuations are complex and involve data which is not publicly available and a degree of judgement. The valuation is based upon the key assumptions of estimated rental values and market-based yields. The approach to developments and material refurbishments is on a residual basis and factors, such as the assumed timescale, the assumed future development cost and an appropriate finance and/or discount rate are used to determine the property value together with market evidence and recent comparable properties where appropriate. In determining fair value, the valuers refer to market evidence and recent transaction prices for similar properties. The Directors are satisfied that the valuation of the Group’s investment property is appropriate for inclusion in the condensed consolidated financial statements. The fair value of these properties is based on the valuation provided by C&W. This valuation is based on future cashflows from rental income both for the current lease period and future estimated rental values. In accordance with the Group’s policy on income recognition from leases, the valuation provided by C&W is adjusted by the fair value of the income accruals ensuing from the recognition of lease incentives and the deferral of lease costs. The total reduction in the external valuer’s investment property valuation in respect of these adjustments was €7.3m (31 March 2019: €6.7m). There were no other significant judgements or key estimates that might have a material impact on the condensed consolidated financial statements at 30 September 2019.

3. Application of new and revised International Financial Reporting Standards (“IFRS”)

Changes in accounting standards The following standards, amendments and interpretations endorsed by the EU were effective for the first time for the Group’s current accounting period and had no material impact on the financial statements. IFRS 16 Leases Effective for accounting periods starting on or after 1 January 2019. The main impact of this standard, which replaces IAS 17 and SIC-15, is the removal of the distinction between operating and financial leases for lessees. This will result in almost all leases being recognised on the balance sheet for lessees. As the Group does not hold any material operating leases as lessee, the impact of the standard is not material in the Group’s financial statements. This standard has also no material impact on the Group’s accounting for rental and related income as lessor. Amendments and interpretations which became effective during the period but had no material impact on the Group’s financial statements IFRIC 23 Uncertainty over tax treatments IFRS 9 Prepayment features with negative compensation IAS 19 Plan amendment containment or settlement IAS 28 Long term interests in associates or joint ventures Annual improvements to IFRS standards 2015-2017 cycle Standards, amendments, and interpretations in issue but not yet effective nor early adopted The Directors do not anticipate that these standards or amendments will have any material effect on the Group’s financial statements. IFRS 17 Insurance contracts IFRS 10 and IAS 28 (amended) Sale or contribution of assets between an investor and its associate or joint venture Amendments to References to the Conceptual Framework in IFRS Standards (amendments to IFRS 2, IFRS 3, IFRS 6, IFRS 14, IAS 1, IAS 8, IAS 34, IAS 37, IAS 38, IFRIC 12, IFRIC 19, IFRIC 20, IFRIC 22, and SIC-32) Amendment to IFRS 3 Definition of a business Amendment to IAS 1 and IAS 8 Definition of material

Section 2 – Performance This section includes notes relating to the performance of the Group for the period, including segmental reporting, earnings per share and net assets per share as well as specific elements of the condensed consolidated statement of income.

4. Operating segments a. Basis for segmentation The Group is organised into six business segments, against which the Group reports its segmental information. These segments mainly represent the different investment property classes. The Group has divided its business in this manner as the various asset segments differ in their character and returns profiles depending on market conditions and reflect the strategic objectives that the Group has targeted. The following table describes each segment:

Reportable segment Description

Office assets Office assets comprise central Dublin completed office buildings, all of which are either generating rental income or are available to let. Those assets which are multi-tenanted or multi-let are mainly managed by the Group. Income is therefore rental income and service charge income, including management fees, while expenses are service charge expenses and other property expenses. Where only certain floors of a building are under-going refurbishment the asset remains in this category.

Office development assets Office development assets are not currently revenue generating and are the properties that the Group has currently under development in line with its strategic objectives. Development profits, recognised in line with completion of the projects, enhance Net Asset Value (“NAV”), Total Accounting Return (“TAR”), and Total Portfolio Return (“TPR”). Once completed these assets are transferred to the office assets segment at fair value.

Residential assets This segment contains the Group’s completed multi-tenanted residential assets.

Industrial/land assets This segment contains industrial units and agricultural land, which generates some rental income.

Other assets This segment contains other assets that are not part of the previous four strategic segments. It originally represented the “non-core” assets, i.e. those assets identified for resale from loan portfolio purchases. Currently this segment contains assets held for sale.

Central assets and costs Central assets and costs includes the Group head office assets and expenses.

The Board reviews the internal management reports, including budgets, at least quarterly at its scheduled meetings. There is some interaction between reportable segments. For example, completed development property is transferred to income-generating segments. These transfers are made at fair value on an arm’s length basis using values determined by the Group’s independent valuer. b. Information about reportable segments The Group’s key measure of underlying performance of a segment is total income after revaluation gains and losses, which comprises revenue (rental and service charge income), property outgoings, revaluation of investment properties and other gains and losses.

Total income after revaluation gains and losses includes rental income which is used as the basis to report key measures such as EPRA Net Initial Yield (“NIY”) and EPRA “topped-up” NIY. These alternative performance measures (“APMs”) (detailed in the supplementary section on pages 53 to 59) measure the cash passing rent returns on market value of investment properties before and after an adjustment for the expiry of a rent-free period or other lease incentives, respectively.

An overview of the reportable segments is set out below:

Group consolidated segment analysis

For the six months ended 30 September 2019 unaudited

Office Central development Residential Industrial/land Other assets Group consolidated Office assets assets assets assets assets and costs position €’000 €’000 €’000 €’000 €’000 €’000 €’000 Total revenue 29,515 – 3,547 655 – – 33,717 Rental income 25,547 – 3,547 655 – – 29,749 Property operating expenses (580) – (583) (8) – – (1,171) Net rental and related income 24,967 – 2,964 647 – – 28,578 Gains and (losses) on investment property 6,172 943 766 (1,593) – – 6,288 Other gains and (losses) – – – – – (28) (28) Total income/(expense) 31,139 943 3,730 (946) - (28) 34,838 Administration expenses – – – – – (5,611) (5,611) Depreciation – – – – – (142) (142) Total operating expenses – – – – – (5,753) (5,753) Operating profit/(loss) 31,139 943 3,730 (946) – (5,781) 29,085 Finance income – – – – – 3 3 Finance expense (1,157) – – – – (2,432) (3,589) Profit/(loss) before income tax 29,982 943 3,730 (946) – (8,210) 25,499 Income tax – – – – – 26 26 Profit/(loss) for the period 29,982 943 3,730 (946) – (8,184) 25,525 Total segment assets 1,205,929 21,899 155,487 60,349 534 33,343 1,477,541 Investment property 1,186,620 21,899 154,869 60,349 – – 1,423,737

For the six months ended 30 September 2018 unaudited Office Central Group development Residential Industrial/land Other assets consolidated Office assets assets assets assets assets and costs position €’000 €’000 €’000 €’000 €’000 €’000 €’000 Total revenue 26,822 – 3,386 448 – – 30,656 Rental income 24,300 – 3,386 448 – – 28,134 Property operating expenses (801) (5) (669) (27) – – (1,502) Net rental and related income 23,499 (5) 2,717 421 – – 26,632 Gains and (losses) on investment property 24,259 18,432 9,072 (632) – – 51,131 Other gains and (losses) – – – – 34 – 34 Total income/(expense) 47,758 18,427 11,789 (211) 34 – 77,797 Administration expenses – – – – – (2,841) (2,841) IMA performance-related payments – – – – – (7,453) (7,453) Depreciation – – – – – (150) (150) Total operating expenses – – – – – (10,444) (10,444) Operating profit/(loss) 47,758 18,427 11,789 (211) 34 (10,444) 67,353 Finance income – – – – – 17 17 Finance expense (1,613) – – – – (1,794) (3,407) Profit/(loss) before income tax 46,145 18,427 11,789 (211) 34 (12,221) 63,963 Income tax – – – – – (3) (3) Profit/(loss) for the period 46,145 18,427 11,789 (211) 34 (12,224) 63,960 Total segment assets 993,871 173,200 148,282 25,591 595 59,582 1,401,121 Investment property 984,446 173,200 148,179 24,100 – – 1,329,925

For the financial year ended 31 March 2019 audited

Office Central Group development Residential Industrial/land Other assets consolidated Office assets assets assets assets assets and costs position €’000 €’000 €’000 €’000 €’000 €’000 €’000 Total revenue 53,497 – 6,862 1,028 – – 61,387 Rental income 48,137 – 6,862 1,028 – – 56,027 Property operating expenses (1,373) – (1,314) (31) – – (2,718) Net rental and related income 46,764 – 5,548 997 – – 53,309 Gains and (losses) on investment property 37,837 48,020 13,559 (1,311) – – 98,105 Other gains and (losses) – – – – – 140 140 Total income/(expense) 84,601 48,020 19,107 (314) – 140 151,554 Administration expenses – – – – – (13,606) (13,606) IMA performance-related payments – – – – – (5,401) (5,401) Depreciation – – – – – (284) (284) Total operating expenses – – – – – (19,291) (19,291) Operating profit/(loss) 84,601 48,020 19,107 (314) – (19,151) 132,263 Finance income – – – – – 5 5 Finance expense (2,861) – – – – (5,365) (8,226) Profit/(loss) before income tax 81,740 48,020 19,107 (314) – (24,511) 124,042 Income tax – – – (547) – (36) (583) Profit/(loss) for the financial year 81,740 48,020 19,107 (861) – (24,547) 123,459 Total segment assets 1,224,888 16,199 153,606 53,144 534 24,141 1,472,512 Investment property 1,173,140 16,199 153,079 53,000 – – 1,395,418 c. Geographic information All of the Group’s assets, revenue and costs are based in the Greater Dublin Area, mainly in central Dublin. d. Major customers The Group uses information on its top 10 tenants to monitor its major customers. This is presented below based on contracted rents (including variable rents based on profit sharing arrangements) as at the period end. This is concentrated on office tenants as the next major segment, residential, consists mainly of small private tenants and therefore contains no major concentration of credit risk.

The Group’s top 10 tenants as at 30 September 2019 are as follows, expressed as a percentage of contracted office rent: As at 30 September 2019 Contracted rent Tenant Business sector (€m) % HubSpot Ireland Limited TMT 10.5 19.0 The Commissioners of Public Works (“OPW”) Government Agency 6.0 10.9 Twitter International Company TMT 5.1 9.2 Autodesk Ireland Operations Limited TMT 2.8 5.1 Informatica Ireland EMEA TMT 2.1 3.8 Riot Games TMT 2.0 3.6 Electricity Supply Board (“ESB”) Government Agency 1.9 3.4 Travelport Digital Limited TMT 1.8 3.3 BNY Mellon Fund Services Banking & Capital Markets 1.6 2.9 Commission for Communications Regulation (“ComReg”) Government Agency 1.6 2.9 Top 10 tenants 35.4 64.1 Remaining tenants 19.8 35.9 Whole office portfolio 55.2 100.0

As at 30 September 2018 Contracted Rent Tenant Business Sector (€m) % The Commissioners of Public Works (“OPW”) Government Agency 6.0 12.7 Twitter International Company TMT 5.1 10.8 Hubspot Ireland Limited1 TMT 3.8 8.0 Autodesk Ireland Operations Limited TMT 2.8 5.9 Informatica Ireland EMEA TMT 2.1 4.4 Depfa Bank plc Banking and capital markets 2.0 4.2 Electricity Supply Board (“ESB”) Government Agency 1.9 4.0 Travelport Digital Limited TMT 1.8 3.8 IWG plc Serviced offices 1.8 3.8 BNY Mellon Fund Services Banking & Capital Markets 1.6 3.4 Top 10 tenants 28.9 61.0 Remaining tenants 18.4 39.0 Whole office portfolio 47.3 100.0

1. Excludes 1SJRQ lease agreed in November 2018 27

As at 31 March 2019 Contracted Rent Tenant Business Sector (€m) % HubSpot Ireland Limited TMT 10.5 20.9 The Commissioners of Public Works (“OPW”) Government Agency 6.0 11.9 Twitter International Company TMT 5.1 10.1 Autodesk Ireland Operations Limited TMT 2.8 5.6 Informatica Ireland EMEA TMT 2.1 4.2 Electricity Supply Board (“ESB”) Government Agency 1.9 3.7 Travelport Digital Limited TMT 1.8 3.6 BNY Mellon Fund Services Banking & Capital Markets 1.6 3.2 Commission for Communications Regulation (“ComReg”) Government Agency 1.6 3.2 Core Media TMT 1.4 2.8 Top 10 tenants 34.8 69.2 Remaining tenants 15.6 30.8 Whole office portfolio 50.4 100.0

5. Revenue and net rental and related income

Accounting policy See note 5 of the Annual Report 2019.

Revenue can be analysed as follows:

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Gross rental income 27,954 28,563 56,242 Rental incentives 1,795 (429) (215) Rental income 29,749 28,134 56,027 Revenue from contracts with customers1 3,968 2,522 5,360 Total revenue 33,717 30,656 61,387

1. Revenue from contracts with customers is service charge income

Net rental and related income

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Total revenue 33,717 30,656 61,387 Cost of goods and services1 (3,929) (2,481) (5,482) Property expenses (1,210) (1,543) (2,596) Net rental and related income 28,578 26,632 53,309

1. Costs of goods and services are service charge expenses. Further information on the sources and characteristics of revenue and rental income is provided in note 6.

Included in other property expenses is an amount of €0.4m (Sep 2018: €0.5m) relating to void costs on office properties, i.e. costs relating to office properties which were available to let but were not income-generating during the financial period.

Property operating expenses

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Service charge income 3,968 2,522 5,360 Service charge expenses (3,929) (2,481) (5,482) Property expenses (1,210) (1,543) (2,596) Property operating expenses (1,171) (1,502) (2,718)

6. Disaggregation of revenue and rental income

The Group’s business is the rental of its investment properties, the development of properties for its investment portfolio and the provision of managed multi-let buildings to its tenants. The Group’s revenue consists of rental income, service charge income and other ad hoc receipts from its property business such as surrender premiums. The majority of its contracts are longer term, with some being

10 years or more, excluding residential tenancy arrangements which are generally one year in duration. Service charge arrangements are generally provided for under the lease contract but constitute a different performance obligation, the conditions attaching to which are negotiated annually.

Note 4: Operating segments discloses the analysis of revenue and income and expense in line with the Group’s business model, i.e. by investment property category. In order to complete the disaggregation of revenue by categories that depict how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors, analyses of the revenue for the period by duration of lease contracts (to next break date) and by tenant industry sector are provided below. Additional information on portfolio characteristics that impact on income is set out in the half year business review.

Total revenue by duration of lease contract (based on next break date or expiry) Service charge income is included within the current leases segment as these arrangements, while provided for under the lease contracts, are negotiated on an annual basis. Other income is once-off in nature and is recognised in the one year or less segment, for example rental income on other assets.

Six months ended 30 September 2019 unaudited

One year or Between one Greater than Assets sold Current leases less and five years five years Total Lease contracts: €’000 €’000 €’000 €’000 €’000 €’000 Office assets – 5,532 5,532 9,618 14,365 29,515 Office development assets – – – – – – Residential assets – 3,547 3,547 – – 3,547 Industrial/land assets – 328 328 112 215 655 Total segmented revenue – 9,407 9,407 9,730 14,580 33,717

Six months ended 30 September 2018 unaudited

Between one Greater than Assets sold Current leases One year or less and five years five years Total Lease contracts: €’000 €’000 €’000 €’000 €’000 €’000 Office assets 1,215 4,340 5,555 8,080 13,187 26,822 Office development assets – – – – – – Residential assets – 3,386 3,386 – – 3,386 Industrial/land assets – 448 448 – – 448 Total segmented revenue 1,215 8,174 9,389 8,080 13,187 30,656

Financial year ended 31 March 2019 audited One year or less Between one Greater than Assets sold Current leases €’000 and five years five years Total Lease contracts: €’000 €’000 €’000 €’000 €’000 Office assets 2,926 10,360 13,286 16,710 23,501 53,497 Office development assets – – – – – – Residential assets – 6,862 6,862 – – 6,862 Industrial/land assets – – – 698 330 1,028 Total segmented revenue 2,926 17,222 20,148 17,408 23,831 61,387

Rental income by tenant industry sector

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 % €’000 % €’000 % Technology, media and telecommunications 12,250 41.2 9,405 33.4 19,977 35.7 Government agency 5,157 17.3 5,027 17.9 10,362 18.5 Banking and capital markets 4,103 13.8 4,888 17.4 8,501 15.2 Residential 3,547 11.9 3,383 12.0 6,862 12.2 Professional services 2,265 7.6 2,420 8.6 5,276 9.4 Co-working 804 2.7 1,584 5.6 2,230 4.0 Logistics 568 1.9 448 1.6 1,028 1.8 Insurance and reinsurance 534 1.8 706 2.5 1,246 2.2 Other 521 1.8 273 1.0 545 1.0 Rental income 29,749 100.0 28,134 100.0 56,027 100.0

7. Gains and losses on investment property

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Revaluation of investment property 6,288 48,734 95,527 Gains on sale of investment property – 2,397 2,578 Gains and losses on investment property 6,288 51,131 98,105

There were no sales of investment property in the period. Sales of two properties in the financial year ended 31 March 2019 realised proceeds of €99m and a profit over book value of €2.6m after costs.

8. Other gains and losses

Other gains and losses arose from amounts received or paid in relation to non-core assets and realised gains or losses on the resolution of loans measured at fair value.

9. Administration expenses

Accounting policy See note 9 of the Annual Report 2019.

Operating profit for the period has been stated after charging:

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Non-Executive Directors’ fees 248 217 447 Staff costs 2,928 2,044 4,516 Professional valuer’s fees 144 135 394 Depository fees 165 164 299 “Top-up” internalisation expenses – 1,113 1,482 Prepaid remuneration expense – 2,222 2,679 Depreciation 142 150 284 Other administration expenses 2,126 1,558 3,789 Administration expenses 5,753 7,603 13,890

All fees paid to Non-Executive Directors are for services as Directors to the Company. Non-Executive Directors received no other benefits during the period. Frank Kenny received €140k in consulting fees in the financial year ended 31 March 2019 as well as payments in relation to his interest as a Vendor of the Investment Manager (note 32). These arrangements all ceased in the prior year.

Prepaid remuneration expense related to the recognition of payments to the Vendors of the Investment Manager that were contingent on the continued provision of services to the Group over the period during which the Group benefited from the service. These payments were made in November 2015 as part of the internalisation of the Investment Manager and were made subject to clawback arrangements for those Vendors who remain tied to the Company by employment or service contracts. These amounts were amortised until the expiry of these arrangements on 26 November 2018.

Professional valuer’s fees are paid to Cushman & Wakefield (“C&W”), in return for its services in providing independent valuations of the Group’s investment properties on an at least twice-yearly basis. The fees are charged on a fixed rate per property valuation.

Staff costs can be further analysed as follows:

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Wages and salaries (including cash bonuses) 2,350 1,970 4,953 Social insurance costs 208 181 430 Employee share-based payment expense 365 365 587 Pension costs - defined contribution plan 195 145 310 Total 3,118 2,661 6,280

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Administration expenses 2,928 2,044 4,516 Net property expenses 190 191 954 IMA performance related payments – 426 810 Total 3,118 2,661 6,280

10. Share-based payments

Accounting policy See note 11 of the Annual Report 2019.

Movements in share-based payments during the period by share-based payment scheme

Summary of share-based payments outstanding as at 30 September 2019 Balance outstanding at start of Settled during financial Provided during Balance outstanding at period period period end of period ‘000 ‘000 ‘000 ‘000 €’000 Shares €’000 Shares €’000 Shares €’000 Shares a. Annual bonus 23 17 – – 117 78 140 95 b. Long term incentive payments – – – – 83 65 83 65 c. Performance-related payments (IMA) 6,069 4,495 (6,107) (4,519) 38 24 – – c. Employee incentives - previous arrangements 1,464 1,087 (469) (374) (50) (36) 945 677 Total 7,556 5,599 (6,576) (4,893) 188 131 1,168 837

Summary of share-based payments outstanding as at 31 March 2019 Balance outstanding at Settled during financial Provided during Balance outstanding at start of period period period end of period ‘000 ‘000 ‘000 €’000 Shares €’000 Shares €’000 Shares €’000 ‘000 Shares a. Annual bonus – – – – 23 17 23 17 b. Long term incentive payments – – – – – – – – c. Performance-related payments (IMA) 7,332 5,079 (7,334) (5,079) 6,071 4,495 6,069 4,495 c. Employee incentives - previous arrangements 1,451 1,104 (551) (428) 564 411 1,464 1,087 Total 8,783 6,183 (7,885) (5,507) 6,658 4,923 7,556 5,599

2018 Remuneration Scheme

This scheme was introduced in the 2019 financial year and was described in full in the 2018 Annual Report and is available on our website.

Remuneration consists of the following:

1. Basic pay 2. Annual Bonus 3. Long-Term Incentive Plan (“LTIP”) The split between personal and Group performance targets is set depending on an employee’s ability to influence Group outcomes, but all employees have an element of Group performance within their targets. All Group employees are eligible to participate in the Annual Bonus while the LTIP applies to Executive Directors and to members of the Senior Management Team and potentially others in exceptional circumstances. a. Annual Bonus Six months ended 30 September 2019 Financial year ended 31 March 2019 audited unaudited € '000 ‘000 Shares € '000 ‘000 Shares Opening balance at start of period 23 17 - - Movements in amounts provided during the period 2019 awards 45 29 23 17 2020 awards 72 49 - - Net amount provided during the period 117 78 23 17 Closing balance at end of period 140 95 23 17

The share-based element of the Annual Bonus for the year ended 31 March 2019 was granted on a number of dates in June and July 2019. One third of the total Annual Bonus consists of the grants of options to acquire shares in the Company at nil cost subject to a three- year service condition. If the service condition is met, then employees can exercise their option at any date after the third anniversary of the financial year to which they relate. The deferred shares awarded under the Annual Bonus are subject only to continued employment. The fair value of the share award is therefore the number of shares granted at the closing share price on the date of grant. 215,796k share awards were made under this arrangement and approved by the Remuneration Committee on several dates in June and July 2019 giving rise to a total fair value at the grant dates of €313k. This is discounted by Management’s estimate of expected departure rates and is provided for over the period from the commencement of the scheme until 31 March 2022. b. Long-Term Incentive Plan (“LTIP”) The LTIP commenced during the period with the first grant on 31 July 2019. This award consists of nil cost options which vest in three years. Under the LTIP, recipients are granted a variable number of equity instruments depending on market and other conditions as illustrated below.

LTIP conditions Weighting Reference Performance condition type Service condition SC n/a Relative Total Property Return 33% TPR Non-market Total Accounting Return 33% TAR Non-market Relative Total Shareholder Return 33% TSR Market

There is a two year restricted holding period post vesting, but this is not subject to measurement as all conditions terminate on vesting. The LTIPs are measured as follows:

Non market conditions: The fair value of the shares to be issued is determined using the grant date market price. The expected number of shares is calculated based on the expectations of the number of shares which may vest at the vesting date and amortised over the vesting period. At each accounting date, the calculation of the number of shares is revised according to current expectations or performance. The number of shares is discounted at Management’s estimate of the expected employee departure rate.

Market condition: The expected performance of Hibernia REIT plc shares over the vesting period is calculated using a Monte Carlo simulation of 10,000 possible outcomes which are then averaged. This is used to amortise the fair value of an expected cost over the vesting period. The service condition Is ignored for this calculation but applied in accruing the amounts due. On vesting, any difference in amounts accrued versus actual is amended through reserves.

2019 LTIP Number of awards granted : 1,853,381 Grant date: 31 July 2019 Total awards made at maximum vesting Provided as at period end '000 shares '000 shares LTIP dated 31 July 2019 1,853 65 Total LTIP awards as at period end 1,853 65

One third of each award made is subject to a relative TSR measure against the constituents of the FTSE EPRA NAREIT Developed Europe Index. One third each is made against TPR and TAR measures. There were no provisions made for the TPR element as at 30 September 2019 as performance fell below the threshold. 32k shares were provided against the TAR element based on the performance for the period and 33k shares were provided against the TSR element based on the fair value calculated using a TSR pricing model taking account of peer group TSR, volatilities and correlators together with the following assumptions:

31 July 2019 LTIP Risk free interest rate(%) (0.80) Expected volatility (%) 17.1

32 c. Pre 2018 remuneration arrangements (IMA and employees)

Six months ended 30 September 2019 unaudited Financial year ended 31 March 2019 audited € '000 ‘000 Shares € '000 ‘000 Shares Opening balance at start of period 1,464 1,087 1,451 1,104 Payment made during the period Shares issued (150) (122) (212) (163)

Cash-settled share-based payments (taxes) (163) (132) (223) (177) Cash-settled share-based payments (156) (120) (116) (88) Total cash paid (319) (339) Total payments in the period (469) (374) (551) (428) Movements in amounts provided during the period Share-based performance grants recognised 119 89 988 735 Cash bonus element – – (405) (303) Other amendments (169) (125) (19) (21) Net amount provided during the period (50) (36) 564 411 Closing balance at end of period 945 677 1,464 1,087

Investment Management Agreement (“IMA”) performance-related payments to Vendors and staff IMA performance-related payments refer to those payments that were made under the IMA for each financial year and settled mainly in shares of the Company until the expiry of the agreement on 26 November 2018. These arrangements expired with the introduction of the 2018 Remuneration Scheme and no further awards will be due under this arrangement. All amounts due to the Vendors have been settled during the period with the final issuance of 4.5m shares. There are 0.5m shares outstanding to employees at 30 September 2019 under the IMA agreement for which the final vesting date is 31 March 2021. These shares are forfeited by employees should they leave the Group prior to the vesting date unless subject to “good leaver” provisions. However shares forfeited are transferable to the Vendors on the basis that these shares have been deducted from performance fees that would otherwise have been due to the Vendors. Therefore there is no impact on fair value measurement from any possible departures relating to these shares. Employee incentives – interim arrangements This covered employees who were providing services that were not part of the original IMA. This arrangement expired with the introduction of the 2018 Remuneration Scheme and the final vesting date is 31 March 2021. A total of 0.2m shares are outstanding under this arrangement and these are forfeited should the employee leave the Group prior to the vesting date unless subject to “good leaver” provisions.

11. Finance costs

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited €’000 €’000 €’000 Interest on revolving credit facility 2,532 3,543 7,854 Interest on private placement notes 957 - 358 Other finance costs 141 60 442 Gross finance costs 3,630 3,603 8,654 Less: Capitalised interest at an average rate of 2.00% (September 2018: 2.05%) (41) (196) (428) Finance costs for the period 3,589 3,407 8,226

12. Dividends

Accounting policy See note 11 of the Annual Report 2019.

Six months ended Six months ended 30 September 2019 30 September 2018 unaudited unaudited €’000 €’000 Interim dividend declared for the period ended 30 September 2019 of 1.75 cent per share (30 September 2018: 1.5 cent per share) 11,989 10,464 Final dividend paid for the financial year ended 31 March 2019 of 2.0 cent per share (31 March 2018: 1.9 cent per share) 13,885 13,254

The Board has declared an interim dividend of 1.75 cent per share (September 2018: 1.5 cent). This dividend is expected to be paid to shareholders on 23 January 2020. All of this proposed interim dividend of 1.75 cent per share will be a Property Income Distribution (“PID”) in respect of the Group’s property rental business (March 2019: 2.0 cent).

Under the Irish REIT regime, the Company is required to distribute a minimum of 85% of the Group’s property rental business profits and the Group’s dividend policy is to pay out 85-90% of its property rental business profits annually. The interim dividend of 1.75 cent represents c.63% of EPRA earnings per share for the period and 50% of the dividends per share paid in the prior financial year.

13. Earnings per share

There are no convertible instruments, options or warrants on ordinary shares in issue as at 30 September 2019 other than those arrangements relating to share-based payments. The Company has established a reserve of €1.2m (September 2018: €5.0m, March 2019: €7.6) which is mainly for the issue of ordinary shares relating to the Group’s bonus schemes (and, as at 30 September 2018 and 31 March 2019, the Group’s obligations under the IMA performance-related payments). It is estimated that a maximum of approximately 1.3m ordinary shares (September 2018: 3.8m; March 2019: 6.0m shares) may be issued in total under the share-based performance award schemes (note 10), 0.8m of which are provided for at 30 September 2019 and a further 0.5m of which may be recognised over the next three years, depending on performance to date and various service conditions as described in note 10. The potential maximum dilutive effect of these shares (assuming awards vest at maximum value and with no forfeits) is disclosed below.

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Weighted average number of shares Notes ’000 ’000 ’000 Issued share capital at beginning of period 697,589 692,347 692,347 Shares issued during the period 4,641 5,242 5,242 Shares redeemed during the period (13,270) – – Shares in issue at end of period 21 688,960 697,589 697,589 Weighted average number of shares 692,330 694,968 694,968 Number of shares to be issued under share-based schemes 1,325 3,727 6,028 Diluted weighted average number of shares 693,655 698,695 700,996

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited ’000 ’000 ’000

Number of shares due to be issued under share-based schemes recognised at the period end 10 837 3,588 5,599 Number of shares due under share-based schemes not recognised at the period end 488 139 429 Number of shares to be issued under share–based schemes 1,325 3,727 6,028

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Basic and diluted earnings per share (IFRS) €’000 €’000 €’000 Profit for the period attributable to the owners of the Company 25,525 63,960 123,459 ’000 ’000 ’000 Weighted average number of ordinary shares (basic) 692,330 694,968 694,968 Weighted average number of ordinary shares (diluted) 693,655 698,695 700,996 Basic earnings per share (cent) 3.7 9.2 17.8 Diluted earnings per share (cent) 3.7 9.2 17.6

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited EPRA earnings per share and diluted EPRA earnings per share1 Notes €’000 €’000 €’000 Profit for the period attributable to the owners of the Company 25,525 63,960 123,459 Less: Gains and losses on investment property 7 (6,288 ) (51,131 ) (98,105 ) Profit or (loss) on disposals of other assets - - (140 ) Deferred tax in respect of EPRA adjustments - - 547 Changes in fair value of financial instruments and associated close-out costs 47 20 1,711 EPRA earnings 19,284 12,849 27,472

‘000 ‘000 ‘000 Weighted average number of ordinary shares (basic) 692,330 694,968 694,968 Weighted average number of ordinary shares (diluted) 693,655 698,695 700,996 EPRA earnings per share (cent) 2.8 1.8 4.0 Diluted EPRA earnings per share (cent) 2.8 1.8 3.9

1 EPRA earnings, an APM, are presented as they illustrate for investors the extent to which dividends are supported by recurring income. Therefore financial instruments used as hedges are recognised under a held to maturity model which leads to a difference in valuation basis. In December 2018, the remaining arrangement fees relating to the previous RCF were written off, which are eliminated in the EPRA calculation as a once off financing impact.

14. IFRS NAV, EPRA NAV per share and Total Accounting Return

The IFRS NAV is calculated as the value of the Group’s assets less the value of its liabilities based on IFRS measures. EPRA NAV (which is an APM) is calculated in accordance with the European Public Real Estate Association (“EPRA”) Best Practice Recommendations: November 2016.

The EPRA NAV per share includes investment property, other non-current assets and trading properties at fair value. For this purpose, non-current assets classified as held for sale are included at fair value. It excludes the fair value movement of financial instruments and deferred tax. It is calculated on a diluted basis.

Total Accounting Return, a key performance indicator and alternative performance measure, is calculated as the increase in EPRA NAV per share over the previous period-end EPRA NAV and adding back dividends per share paid, expressed as a percentage of opening EPRA NAV.

As at 30 September 2019 As at 31 March 2019 unaudited audited IFRS net assets at end of period (€’000) 1,211,622 1,218,539 Ordinary shares in issue (‘000) 688,960 697,589 IFRS NAV per share (cent) 175.9 174.7

’000 ’000 Ordinary shares in issue 688,960 697,589 Number of shares to be issued under share-based schemes (see note 13) 1,325 6,028 Diluted number of shares 690,285 703,617 Diluted IFRS NAV per share (cent) 175.5 173.2

€’000 €’000 IFRS net assets at end of period 1,211,622 1,218,539 Deferred tax 547 547 Net mark to market on financial assets 347 288 EPRA NAV 1,212,516 1,219,374 Diluted number of shares (‘000) 690,285 703,617 EPRA NAV per share (cent) 175.7 173.3

Total accounting return

As at 30 September 2019 As at 30 September 2018 As at 31 March 2019 unaudited unaudited audited Opening EPRA NAV per share 173.3c 159.1c 159.1c Closing EPRA NAV per share 175.7c 166.3c 173.3c Increase in EPRA NAV per share 2.4c 7.2c 14.2c Dividends per share paid in period 2.0c 1.9c 3.4c Total return 4.4c 9.1c 17.6c Total accounting return (“TAR”) 2.5% 5.7% 11.1%

Section 3 –Tangible assets This section contains information on the Group’s investment properties and other tangible assets. All investment properties are fully owned by the Group. The Group’s investment properties are carried at fair value and its other tangible assets at depreciated cost except for land and buildings which are adjusted to fair value.

15. Investment property

Accounting policy See note 17 of the Annual Report 2019.

In valuing the Group’s investment properties, the Directors have applied a reduction of €7.3m (March 2019: €6.7m) to the valuer’s valuations to factor in the impact of the accounting policy on the recognition of rental incentives allowed to tenants and the costs of setting up leases. This deduction is a measure of the impact on the property valuation of the difference between cash and accounting approaches to the recognition of net rental income. At 30 September 2019 unaudited Office development Residential Industrial/land Office assets assets assets assets Level 3 Level 3 Level 3 Level 3 Total Level 3 Fair value category €’000 €’000 €’000 €’000 €’000 Carrying value at 31 March 2019 1,173,140 16,199 153,079 53,000 1,395,418 Additions: Property purchases 7,611 – 694 8,809 17,1141 Development and refurbishment expenditure 5,4542 4,757 330 133 10,674 Revaluations included in income statement 6,172 943 766 (1,593) 6,288 Disposals: Sales – – – – – Transferred to owner occupied property3 (5,757) – – – (5,757) Carrying value at 30 September 2019 1,186,620 21,899 154,869 60,3494 1,423,737

1. A VAT refund of €0.5m was received for prior years relating to the grant of VAT inclusive leases in 2DC, following its refurbishment. Gross acquisitions were therefore €17.6m. 2. This includes capital expenditure on 1WML, SJRQ and 2WML after their transfer to the office segment. 3. The Group plans to move to a new head office in 1WML in late 2019. During the period fit-out work has commenced on this space and therefore it has been recognised as owner occupied property in these condensed consolidated financial statements. The space currently occupied by the Group in South Dock House has been leased to a tenant from December 2019 (signed on 30 September 2019) so when the Group relocates, this space will be transferred to investment property. These transfers are recognised at fair value on the date of transfer. 4. On 9 November 2018 the Group agreed to acquire 92.5 acres adjacent to its holdings in Newlands Cross from the Irish Rugby Football Union (the “IRFU”) for initial consideration of €27m (the “IRFU Land”). If rezoning is achieved in the next 10 years the IRFU will be due additional consideration equating to 44% of the value of Hibernia’s total land interests of 143.7 acres in the Newlands site at rezoning, less the initial consideration.

At 31 March 2019 audited

Office development Industrial/land Office assets assets Residential assets assets Total Level 3 Level 3 Level 3 Level 3 Level 3 Fair value category €’000 €’000 €’000 €’000 €’000 Carrying value at 31 March 2018 1,017,937 134,500 138,480 17,800 1,308,717 Additions: Property purchases 2,956 – 980 36,094 40,030 Development and refurbishment expenditure 5,2441 41,500 60 417 47,221 Revaluations included in income statement 35,259 48,020 13,559 (1,311) 95,527 Disposals: Sales2 (96,077) – – – (96,077) Transferred between segments3 207,821 (207,821) – – – Carrying value at 31 March 2019 1,173,140 16,199 153,079 53,0004 1,395,418

1. This includes capital expenditure on 1WML and 2DLC after their transfer to the office segment in the prior year. 2. New Century House and 77 Sir John Rogerson’s Quay were sold or contracted to be sold during the year, generating €2.6m in gains in excess of their carrying values. 3. 2WML (formerly the Hanover Building) and 1SJRQ were transferred from ‘Office development assets’ to ‘Office assets’ as they were completed before 31 March 2019. 4. On 9 November 2018 the Group agreed to acquire 92.5 acres adjacent to its holdings in Newlands Cross from the Irish Rugby Football Union (the “IRFU”) for initial consideration of €27m (the “IRFU Land”). If rezoning is achieved in the next 10 years the IRFU will be due additional consideration equating to 44% of the value of Hibernia’s total land interests of 143.7 acres in the Newlands site at rezoning, less the initial consideration.

There were no transfers between fair value levels during the period. €5.8m was transferred to fixed assets as described in footnote 3 to the 30 September 2019 table. This space consists of 5,400 sq. ft. in 1WML. €6m approximately will be transferred from fixed assets in late 2019 when the South Dock House premises cease to be owner occupied property and reverts to investment property. Approximately €41k of financing costs were capitalised at an effective interest rate of 2.0% in relation to the Group’s developments and major refurbishments (March 2019: €0.4m). No other operating expenses were capitalised during the period.

EPRA capital expenditure Six months ended Financial year ended 30 September 2019 31 March 2019 unaudited audited €’m €’m Acquisitions 17.1 40.0 Analysed further as: Purchases of investment property 17.6 40.0 In-place portfolio – VAT refund received relating to the acquisition of 2DC (0.5) -

Capital expenditure 10.7 47.2 Analysed further as: Developments1 9.3 44.8 Maintenance capex 0.3 0.3 Other2 1.1 2.1 Total capital expenditure for period 27.8 87.2

1. Capital expenditure relating to development or major refurbishment of 1SJRQ, 1&2WML, and 2 Cumberland Place. 2. Financing expenses capitalised and expenditure on existing properties in relation to future planning for redevelopment. Reconciliation of the independent valuer’s valuation report amount to the carrying value of investment property in the consolidated statement of financial position: As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Valuation per valuer’s certificate 1,443,010 1,407,740 Owner occupied (note 16) (11,968) (5,643) Income recognition adjustment1 (7,305) (6,679) Investment property balance at end of period 1,423,737 1,395,418

1. Income recognition adjustment: this relates to the difference in valuation that arises as a result of property valuations using a cash flow based approach while income recognition for accounting purposes spreads the costs of tenant incentives and lease set up over the lease term.

Information about fair value measurements using unobservable inputs (Level 3) The valuation technique used in determining the fair value for each of the categories of assets is market value as defined by VPS4 of the Red Book 2017, being the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had acted knowledgeably, prudently and without compulsion, and is in accordance with IFRS 13. Included in the inputs for the valuations above are future development costs where applicable. These development costs are generally determined by tender at the outset of the project and capped by agreement with the contractors and are therefore observable and not subject to material change.

As outlined above, the main inputs in using a market-based capitalisation approach are the ERV and equivalent yields. ERVs, apart from in multi-family residential properties, are not generally directly observable and therefore classified as Level 3. Yields depend on the valuer’s assessment of market capitalisation rates and are therefore Level 3 inputs.

The tables below summarise the key unobservable inputs used in the valuation of the Group’s investment properties at 30 September 2019. There are interrelationships between these inputs as they are both determined by market conditions and the valuation result in any one period depends on the balance between them. The Group’s residential properties are mainly multi-family units and therefore ERVs are based on current market rents observed for units rented within the property. ERV is included in the below table for completeness.

Valuation methodology The following table illustrates the fair value methods applied to each segment: Description of Fair value of investment the investment property asset property €’m at Narrative description of Changes in the fair value technique during class the period end the techniques used the period

Office assets 1,187 Yield methodology using market rental values capitalised with a No change in valuation technique market capitalisation rate. Exceptions to this: - Harcourt Square is valued on an investment basis until the end of the lease (2022) and on a residual basis thereafter. - Marine House and Clanwilliam Court Blocks 1, 2 and 5 are valued on an investment basis until the end of the leases (2020 and 2021 respectively) and on a residual basis thereafter.

Office 22 Residual method, i.e. “Gross Development Value” less “Total No change in valuation technique development Development Cost” less “Profit” equals “Fair Value”: assets - Gross Development Value (“GDV”): the fair value of the completed proposed development (arrived at by capitalising the ERV with an appropriate yield, allowances for purchasers’ costs, assumptions for voids and/or rental free periods). - Total Development Cost (“TDC”): this includes, but is not limited to, construction costs, land acquisition costs, professional fees, levies, marketing costs and finance costs. - Profit or “Profit on Cost” which is measured as a percentage of the total development costs (including the site value). For developments close to completion the yield methodology is applied.

Residential 155 Yield methodology using rental values capitalised with a market No change in valuation technique assets capitalisation rate. Net yields are used in this period. Rental values used are current and not estimated rental values. .

Industrial/land 60 Yield methodology using market rental values capitalised with a No change in valuation technique. assets market capitalisation rate. The Newlands /Gateway site, including adjacent lands, is valued as an early stage development site on a price per acre basis.

Key unobservable inputs used in the valuation of the Group’s investment property 30 September 2019 (unaudited) Market value Estimated rental value Equivalent yield €‘000 Low High Low High Office 1,186,620 €25.00psf €62.50psf 4.04% 6.88% Office development 21,899 €30.00psf €60.00psf 4.75% 4.75% Residential1 154,869 €2,050pa €2,650pa 3.71%2 3.97%2 Industrial/land 60,349 €5.25psf €9.00psf 7.74% 8.00%

1. Average market rent for two bed apartment 2. Now on a net basis 31 March 2019

Market value Estimated rental value Equivalent yield €’000 Low High Low High Office 1,173,140 €15.00 psf €60.00 psf 4.04% 7.30% Office development 16,199 €30.00 psf €57.50 psf 4.75% 4.75% Residential1 153,079 €23,400 pa €31,800 pa 5.16% 6.00% Industrial/land 53,000 €5.25 psf €5.25 psf 8.02% 8.02%

1. Average market rent for two bed apartment The sensitivities below illustrate the impact of movements in key unobservable inputs on the fair value of investment properties.

To calculate these impacts only the movement in one unobservable input is changed as if there is no impact on the other. In reality there may be some impact on yields from an ERV shift and vice versa. However, this gives an assessment of the maximum impact of shifts in each variable. If rents in the market are assumed to increase 5% from those estimated at 30 September 2019, the Group’s investment property portfolio would increase in value by approximately €67.2m (March 2019: €62m). A decrease in market rents of 5% would result in a €68.2m decrease in portfolio value. A 25bp increase in equivalent yields would decrease the value of the portfolio by €92.2m (March 2019: €83m) and a 25bp decrease would result in an increase in value of €88.2m (March 2019: €95m).

30 September 2019 Impact on market value of a 5% change Impact on market value of a 25bp in the estimated rental value change in the equivalent yield Sensitivities Increase €‘m Decrease €’m Increase €‘m Decrease €’m Office 57.2 (58.3) (80.1) 74.5 Office development 2.2 (2.2) (2.4) 2.6 Residential1 7.6 (7.5) (9.6) 10.9 Industrial/land 0.2 (0.2) (0.1) 0.2 Total 67.2 (68.2) (92.2) 88.2

1. ERV has no impact on valuation as residential valuations are completed on a current rent basis.

31 March 2019

Impact on market value of a 5% change Impact on market value of a 25bp in the estimated rental value change in the equivalent yield Sensitivities Increase €‘m Decrease €’m Increase €‘m Decrease €’m Office 52.6 (53.7) (72.8) 80.2 Office development 1.9 (2.0) (2.1) 2.2 Residential 7.5 (7.5) (8.2) 12.1 Industrial/land 0.1 (0.1) (0.1) 0.1 Total 62.1 (63.3) (83.2) 94.6

16. Property, plant and equipment

Accounting policy See note 18 of the Annual Report 2019.

At 30 September 2019

Leasehold Office and improvements Land and computer and fixtures and buildings equipment fittings Total €’000 €’000 €’000 €’000 Cost or valuation At 1 April 2019 5,942 207 596 6,745 Additions1 5,757 3 377 6,137 Revaluation recognised in other comprehensive income 627 – – 627 At 30 September 2019 12,326 210 973 13,509 Depreciation At 1 April 2019 (299) (152) (392) (843) Charge for the period (59) (17) (66) (142) At 30 September 2019 (358) (169) (458) (985) Net book value at 30 September 2019 11,968 41 515 12,524

At 31 March 2019 Leasehold improvements Office and computer and fixtures and Land and building equipment fittings Total €’000 €’000 €’000 €’000 Cost or valuation At 1 April 2018 5,219 161 590 5,970 Additions – 46 6 52 Revaluation recognised in other comprehensive income 723 – – 723 At 31 March 2019 5,942 207 596 6,745 Depreciation At 1 April 2018 (190) (104) (265) (559) Charge for the year (109) (48) (127) (284) At 31 March 2019 (299) (152) (392) (843) Net book value at 31 March 2019 5,643 55 204 5,902

Land and buildings, 54% of South Dock House, was revalued at 30 September 2019 and at 31 March 2019 by the Group’s independent valuer and in accordance with the valuation approach described within note 15. It was measured at fair value at the period end using a yield methodology using market rental values capitalised with a market capitalisation rate. 5,400 sq. ft. in 1WML was transferred at fair

39 value on 30 September 2019 from investment property. These fair value measurements use significant unobservable inputs. The inputs used are disclosed in the table below.

Valuation inputs 30 September 20191 31 March 2019 ERV per sq. ft. €57.50 €57.50 Equivalent yield 4.8% 5.0% 1. SDHS only, 1WML book value is fair value at the date of transfer.

17. Other assets

These are property assets which were acquired as part of a loan portfolio purchased to acquire some of the Group’s investment properties and are not suitable for retention as investment property. Previously they were recognised as non-current assets held for sale. A profit of €5m has been realised on the disposal of these assets to date and the Directors have concluded that the fair value of the remaining assets is at least their carrying value. The sale of the remaining assets has been delayed and the Directors have concluded that it is more appropriate that they be recognised as non-current.

Section 4 – Financing including equity and working capital This part focuses on the financing of the Group’s activities, including the equity capital, bank borrowings and working capital. It also covers financial risk management.

The Group’s accounting policies with respect to these items can be found in Section IV of the Annual Report 2019.

18. Cash and cash equivalents

As at 30 September 2019 As at 31 March 2019 €’000 €’000

Cash and cash equivalents 25,327 22,372

Cash and cash equivalents includes cash at banks in current accounts and deposits held on call with banks. The management of cash and cash equivalents is discussed in note 29.d. Please also refer to note 24.b on the net debt calculations. In addition, the Company holds funds in excess of its regulatory minimum capital requirement at all times.

19. Other financial assets

Accounting policy See note 21 of the Annual Report 2019.

As at 30 September 2019 As at 31 March 2019 €’000 €’000 Derivatives at fair value 11 194

Cash flow hedges are the Group’s hedging instruments on its borrowings. The Group has a policy of having the majority of its interest rate exposure on its debt hedged or fixed. As at 30 September 2019, as well as having €75m of fixed coupon private placement notes, it has hedged the interest rate exposure on €225m of its revolving credit facility (March 2019: €225m) using a combination of caps and swaptions to limit the EURIBOR element of interest payable to 1% on €100m of drawn debt and 0.75% on €125m of drawn debt.

20. Trade and other receivables

Accounting policy See note 22 of the Annual Report 2019.

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Non-current Property income receivables 8,678 7,163 Recoverable capital expenditure 597 765 Balance at end of period – non-current 9,275 7,928 Current Property income receivables 4,523 4,105 Expected credit loss allowance (53) – 4,470 4,105 Receivable from investment property sales – 34,639 Deposits paid on investment property 125 145 Prepayments 495 548 Recoverable capital expenditure 321 314 Income tax refund due 11 54 VAT refundable 711 359 Balance at end of period – current 6,133 40,164 Balance at end of period – total 15,408 48,092 Of which are classified as financial assets 3,029 37,630

The non-current balance is mainly non-financial in nature; €0.6m (March 2019: €0.8m) and relates to amounts receivable from tenants in relation to capital expenditure funded initially by the Group, with the balance consisting of amounts relating to the lease incentives and deferred lease costs. Trade and other receivables has no concentration of credit risk as it comprises mainly prepayments (note 29.d).

Trade receivables are managed under a “held to collect” business model. The cash collected represents principal and interest where applicable. The trade receivables have been assessed under the simplified credit loss approach using a provision matrix which refers to the number of days that they have been outstanding. There is no material provision for lifetime expected credit losses required, minor amounts are provided as disclosed above.

21. Issued share capital and share premium

Accounting policy See note 23 of the Annual Report 2019.

At 30 September 2019

No. of shares in Share Share premium Capital redemption Total Company issue capital reserve reserve Capital ’000 €’000 €’000 €’000 €’000 Balance at beginning of period 697,589 69,759 624,483 – 694,242 Shares redeemed during the period (13,270) (1,327) – 1,327 – Shares issued during the period (see below) 4,641 464 5,793 – 6,257 Balance at end of period 688,960 68,896 630,276 1,327 700,499

At 31 March 2019

No. of shares in issue Share capital Share premium Total Company Capital ’000 €’000 €'000 €’000 Balance at beginning of period 692,347 69,235 617,461 686,696 Shares redeemed during the period – – – – Shares issued during the period (see below) 5,242 524 7,022 7,546 Balance at end of period 697,589 69,759 624,483 694,242

Shares issued during the period are as follows: 4,640,868 ordinary shares with a nominal value of €0.10 were issued during the period in settlement of share-based payments totalling €6.2m (note 10): 121,519 shares were issued on 4 April 2019 and 4,519,349 shares were issued on 24 July 2019 and the associated costs were €15k.

Share buyback programme In April 2019 the sale of 77SJRQ was announced and the Group’s intention to return the net proceeds of €35m to shareholders to maintain the Group’s progress towards the lower end of our stated 20-30% target, starting with an on-market share buyback programme of €25m which commenced the same month. As at 30 September 2019 13.3m shares had been repurchased and cancelled under this buyback

41 programme for aggregate consideration of €19m (an average purchase price of €1.43 per share). This completed on 11 November 2019 with a total of 17.6m shares repurchased and cancelled for aggregate consideration of €25.0m (average price €1.42). Share-based payments The Group’s remuneration scheme includes awards which are made in shares or nil cost share options and which are payable to employees only after fulfilling service and/or performance conditions. Amounts provided for at 30 September 2019 were 837k shares and a maximum of a further 488k shares remain to be accrued as at the period end. Amounts due at 31 March 2019 amounted to €7.6m or 5.6m shares and 139k shares which remained to be provided. Full details on these arrangements are in note 10 above.

Share capital Ordinary shares of €0.10 each: Six months ended Financial year ended 30 September 2019 31 March 2019 unaudited audited ‘000 ‘000 Authorised 1,000,000 1,000,000 Allotted, called up and fully paid 688,960 697,589 In issue at end of period 688,960 697,589

22. Other reserves

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Property revaluation 2,516 1,889 Cash flow hedging (347) (288) Share-based payment reserve 1,168 7,556 Balance at end of period 3,337 9,157

22.a Property revaluation reserve As at 30 September As at 31 March 2019 2019 unaudited audited €’000 €’000 Balance at beginning of period 1,889 1,166 Increase arising on revaluation of properties 627 723 Balance at end of period 2,516 1,889

The Group’s headquarters are carried at fair value and the remeasurement of this property is made through other comprehensive income or loss (note 16). property transferred to investment property is transferred at fair value. Therefore the amounts relating to the revaluation of this property during the period it was recognised as a fixed asset will remain in the property revaluation reserve until the asset is ultimately disposed of, at which stage they will be transferred directly to revenue reserves.

22.b Cashflow hedging reserve The cash flow hedging reserve represents the cumulative effective portion of gains or losses arising on changes in fair value of hedging instruments entered into for cash flow hedges. The cumulative gain or loss arising on changes in fair value of the hedging instruments that are recognised and accumulated under the heading of cash flow hedging reserve is reclassified to profit or loss when the hedged transaction affects the profit or loss consistent with the Group’s accounting policy. No income tax arises on this item.

Cumulative gains or losses arising on changes in fair value of hedging instruments that have been tested as ineffective and reclassified from equity into profit or loss during the period are included in the following line items:

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Balance at beginning of period (288) (329) (Loss)/Gain arising on fair value of hedging instruments entered into for cash flow hedges (59) 41 Balance at end of period (347) (288)

22.c Share-based payment reserve As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Balance at beginning of period 7,556 8,783 Performance-related payments provided 188 6,658 Settlement of performance-related payments (6,576) (7,885) Balance at end of period 1,168 7,556

The share-based payment reserve comprises amounts reserved for the issue of shares in respect of performance-related payments. These are discussed further in note 10.

23. Retained earnings, distributable reserves and dividends on equity instruments

Retained earnings

Six months ended Financial year ended 30 September 2019 31 March 2019 unaudited audited €'000 €’000 Balance at beginning of period 515,140 415,414 Profit for the period 25,525 123,459 Share buy-back (18,979) – Share issuance costs (15) (14) Dividends paid (13,885) (23,719) Balance at end of period 507,786 515,140

In August 2019 a dividend of 2.0 cent per share (€13.9m) was paid to the holders of fully paid ordinary shares.

The Directors confirm that the Company continues to comply with the dividend payment obligations contained within the Irish REIT legislation.

Distributable reserves Six months ended Financial year ended 30 September 2019 31 March 2019 unaudited audited €'000 €’000 Retained earnings at end of period (Company only) 425,723 436,014 Unrealised gains on investment property1 (392,153) (388,791) Share buy-back post period end (6,020) – Dividends payable post period end (estimated) (11,981) (13,969) Distributable earnings after dividend and capital buy-back 15,569 33,254

1. Unrealised intercompany profits arising on the transfer of investment properties to subsidiaries of the Company have been eliminated for the purpose of the above calculation

24. Financial liabilities

Accounting policy See note 26 of the Annual Report 2019.

24.a Borrowings As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Non-current Unsecured bank borrowings 164,060 156,524 Unsecured private placement notes 74,553 74,524 Total non-current borrowings 238,613 231,048 Current Unsecured bank borrowings 139 149 Unsecured private placement notes 369 358 Total current borrowings 508 507 Total borrowings 239,121 231,555 The maturity of non-current borrowings is as follows:

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Less than one year 508 507 Between one and two years – – Between two and five years 164,060 156,524 Over five years 74,553 74,524 Total 239,121 231,555

Movements in borrowings during the period: As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Balance at beginning of period 231,555 219,218 Bank finance drawn during the period 37,200 340,412 Bank finance repaid during the period (29,968) (326,372) Interest payable1 334 (1,703) Balance at end of period 239,121 231,555

1. Balance in the prior year is negative due to the capitalisation of arrangement fees on the refinancing of the RCF and the issue of private placement notes. The Group seeks to leverage its equity capital to achieve higher returns within agreed limits. The Group has a stated policy of not incurring debt above 40% of the market value of its property assets and has a through-cycle leverage target of 20-30% loan-to-value (“LTV”). Under the Irish REIT rules the LTV ratio must remain under 50%. The Group has no finance leases.

The Group has €395m of debt facilities comprising:

• A €320m unsecured revolving credit facility expiring December 2023; and • €75m of unsecured US private placement notes, €37.5m dated January 2026 and €37.5m dated January 2029, with fixed rate coupons of 2.36% and 2.69%, respectively.

The unsecured revolving credit facility has a five-year term and is provided by Bank of Ireland, Wells Fargo, Barclays Bank Ireland and Allied Irish Banks. This facility is denominated in euro and is subject to a margin of 2.0% over three-month EURIBOR. The Group has entered into derivative instruments so that the majority of its EURIBOR exposure is capped at 1% or 0.75% in accordance with the Group’s hedging policy (note 29.d.ii).

The private placement notes have an average maturity of 7.8 years at 30 September 2019 and were placed with a single institutional investor. Coupons are fixed so long as the Group’s credit rating remains at or above investment grade.

Where debt is drawn to finance material refurbishments and developments that take a substantial period of time to take into use, the interest cost of this debt is capitalised. All costs related to financing arrangements are amortised using the effective interest rate. The Directors confirm that all covenants have been complied with and are kept under review.

24.b Net debt reconciliation and LTV Net debt and LTV are key metrics in the Group. Net debt is the redemption value of borrowings as adjusted by cash available for use. LTV or “loan to value” is the ratio of net debt to investment property value at the measurement date.

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Cash and cash equivalents 25,327 22,372 Cash reserved1 (5,168) (5,050) Gross debt – fixed interest rates (75,000) (75,000) Gross debt – variable interest rate (166,645) (159,413) Net debt at period end (221,486) (217,091) Investment property at period end 1,423,737 1,395,418 Loan to value ratio 15.6% 15.6%

1. Cash is reduced by the amounts held in relation to rent deposits, sinking funds and similar arrangements as these balances are not viewed as available funds for the purposes of the above calculation. Reconciliation of opening to closing net debt: Assets Liabilities Private Cash and cash Secured Unsecured placement equivalents borrowings borrowings notes Total €'000 €'000 €'000 €'000 €'000 Net debt at as at 1 April 2018 17,691 (220,373) (202,682) Drawings (31,000) (234,412) (75,000) (340,412) Repayments 251,373 74,999 326,372 Movement in cash and cash equivalents (149) (149) Movement in cash reserved 1 (220) (220) Net debt as at 31 March 2019 17,322 – (159,413) (75,000) (217,091) Borrowings – (37,200) – (37,200) Repayments – 29,968 – 29,968 Movement in cash and cash equivalents 2,955 2,955 Movement in cash reserved1 (118) (118) Net debt as at 30 September 2019 20,159 – (166,645) (75,000) (221,486) 1. Cash is reduced by the amounts held in relation to rent deposits, sinking funds and similar arrangements as these balances are not viewed as available funds for the purposes of the above calculation.

25. Deferred tax liabilities

Accounting policy See note 27 of the Annual Report 2019.

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 The balance comprises temporary differences attributable to: Unrealised gains on non REIT business 547 547

The Group is not generally liable for corporate taxes as it has REIT status. Where it is anticipated that certain assets may not qualify as assets of the property rental business (defined in legislation), deferred tax liabilities may be recognised on unrealised gains recognised on these assets as future taxes may be payable on these gains. There were no unrecognised deferred tax assets in the period that might be available to offset against these liabilities.

26. Trade and other payables

Accounting policy See note 28 of the Annual Report 2019.

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Current Investment property payable 4,772 5,667 Rent prepaid 10,999 7,013 Rent deposits and other amounts due to tenants 1,054 1,222 Sinking funds 1,955 1,926 Trade and other payables 4,859 3,742 PAYE/PRSI payable 184 293 Balance at end of period 23,823 19,863 Of which are classified as financial instruments 2,896 3,231

Cash is held against balances due for service charges prepaid and sinking fund contributions, €4.1m (March 2019: €3.9m), and rental deposits from tenants, €1.1m (March 2019: €1.2m). Sinking funds are monies put aside from annual service charges collected from tenants as contributions towards expenditure on larger maintenance items that occur at irregular intervals in buildings managed by the Group.

Trade and other payables are interest free and have settlement dates within one year. The Directors consider that the carrying value of the trade and other payables approximates to their fair value.

27. Contract liabilities

Accounting policy See note 29 of the Annual Report 2019.

Contract liabilities arise from service charge payables. Service charge arrangements form a single performance obligation under which the Group purchases services for multi-let buildings and recharges them to tenants. The movements for the purchase of services and income relating to these activities are presented below.

Contract liabilities €'000 Contract liabilities at 1 April 2018 1,745 (Revenue)/expense recognised during the period 243 Amounts received from customers under contracts 6,311 Amounts paid to suppliers (6,291) Contract liabilities at 31 March 2019 2,008 (Revenue)/expense recognised during the period 78 Amounts received from customers under contracts 3,994 Amounts paid to suppliers (3,652) Contract liabilities at 30 September 2019 2,428

28. Cash flow information

28.a Non-cash movements in operating profit Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Revaluation of investment property 15 (6,288) (48,734) (95,527) Share-based payments 10 188 3,792 6,658 Prepaid remuneration expense 9 – 2,222 2,679 Expected credit loss allowances 20 53 – – Depreciation 16 142 150 284 Taxation (26) 3 547 Non-cash movements in operating profit (5,931) (42,567) (85,359)

28.b Cash expended on investment property Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Property purchases (net) 15 17,114 10,424 40,030 Development and refurbishment expenditure 15 10,674 23,809 47,221 Deposit paid on investment property 20 (20) – 145 (Increase)/decrease in investment property costs 895 (1,564) (549) payable Cash expended on investment property 28,663 32,669 86,847

28.c Cash received from sales of investment property Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Property sales 15 – 62,565 96,077 Profit on sales – 2,397 2,578 Decrease/(Increase) in receivable from investment property sales 20 34,639 – (34,639) Cash received from sales of investment property 34,639 64,962 64,016

28.d Cash expended on property plant and equipment Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited Notes €’000 €’000 €’000 Additions to fixed assets 16 6,137 49 52 Transferred from investment property 16 (5,757) – – Amounts due at period end (250) – – Cash expended on investment property 130 49 52

28.e Non-cash investing and financing activities The Group has no non-cash investing and financing activities.

29. Financial instruments and risk management

29.a Financial risk management objectives and policy The Group takes calculated risks to realise its strategic goals and this exposes the Group to a variety of financial risks. These include, but are not limited to, market risk (including interest and price risk), liquidity risks and credit risk. These financial risks are managed in an overall risk framework by the Board, in particular by the Chief Financial Officer, and monitored and reported on by the Risk and Compliance Officer. The Group monitors market conditions with a view to minimising the volatility of the funding costs of the Group. The Group uses derivative financial instruments such as interest rate caps and swaptions to manage some of the financial risks associated with the underlying business activities of the Group.

29.b Financial assets and financial liabilities The following table shows the Group’s financial assets and liabilities and the methods used to calculate fair value.

Asset/Liability Carrying value Level Fair value calculation technique Assumptions

Trade and other Amortised cost 3 Discounted cash flow Most trade receivables are very short-term, receivables the majority less than one month, and therefore face value approximated fair value on a discounted basis.

Borrowings Amortised cost 2 Discounted cash flow The fair value of financial liabilities held at amortised cost have been calculated by discounting the expected cash flows at prevailing interest rates.

Derivative financial Fair value 2 Calculated fair value price The fair value of derivative financial instruments instruments is calculated using pricing based on observable inputs from financial markets.

Trade and other Amortised cost 3 Discounted cash flow All trade and other payables that could be payables classified as financial instruments are very short-term, the majority less than one month, and therefore face value approximated fair value on a discounted basis

Contract liabilities Amortised cost 3 Discounted cash flow All contract liabilities classified as financial instruments are very short-term, the majority less than one month, and therefore face value approximated fair value on a discounted basis

The carrying value of non-interest-bearing financial assets and financial liabilities approximates to their fair values, largely due to their short-term maturities.

29.c Fair value hierarchy Fair value is 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.

For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: valuation techniques for which the lowest level of inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly.

Level 3: valuation techniques for which the lowest level of inputs that have a significant effect on the recorded fair value are not based on observable market data.

The following tables present the classification of financial assets and liabilities within the fair value hierarchy and the changes in fair values measurements at Level 3 estimated for the purposes of making the above disclosure.

As at 30 September 2019 (unaudited)

Of which are Measured Fair value assessed as financial at fair Measured at Total financial financial Level Total instruments value amortised cost instruments instruments €’000 €’000 €’000 €’000 €’000 €’000 Trade and other receivables 3 15,408 3,029 – 3,029 3,029 3,029 Derivatives at fair value 2 11 11 11 – 11 11 Borrowings 2 (239,121) (238,613) – (238,613) (238,613) (246,695) Trade and other payables 3 (23,823) (2,896) – (2,896) (2,896) (2,896) Contract liabilities 3 (2,428) (2,428) – (2,428) (2,428) (2,428) (249,953) (240,897) 11 (240,908) (240,897) (248,979)

As at 31 March 2019 (audited)

Of which are assessed as Measured Fair value financial at fair Measured at Total financial financial Level Total instruments value amortised cost instruments instruments €’000 €’000 €’000 €’000 €’000 €’000 Trade and other receivables 3 48,092 37,630 – 37,630 37,630 37,630 Derivatives at fair value 2 194 194 194 – 194 194 Borrowings 2 (231,555) (231,555) – (231,555) (231,555) (231,555) Trade and other payables 3 (19,863) (3,231) – (3,231) (3,231) (3,231) Contract liabilities 3 (2,008) (2,008) – (2,008) (2,008) (2,008) (205,140) (198,970) 194 (199,164) (198,970) (198,970)

Movements of Level 3 fair values This reconciliation includes investment property, loans and other financial assets which are included in trade payables, trade receivables and contract liabilities. Measurement of these assets is described in note 15 (Investment property) and in the table at the start of this note.

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Balance at beginning of period 1,395,418 1,308,869 Transfers out of level 3 – – Purchases, sales, issues and settlement Purchases1 27,788 87,251 Sales – (96,077) Loan redemption – (152) Transferred to owner occupied property (5,757) – Fair value movement 6,288 95,527 Balance at end of period 1,423,737 1,395,418

1. Includes development, refurbishment and maintenance expenditure.

29.d Financial risk management This note explains the Group’s exposure to financial risks and how these risks could affect the Group’s future financial performance.

Risk Exposure arising from Measurement Management Market risk – interest rate risk Long-term borrowings at Sensitivity analysis Derivative products – variable rates cap/swaption arrangements Credit risk Cash and cash equivalents, Ageing analysis, credit ratings Cash investment policy with trade receivables, derivative where applicable minimum ratings; financial instruments diversification of deposits where merited Liquidity risk Borrowings and other Cash flow forecasts are Availability of borrowing liabilities completed as part of facilities budgeting process

The policies for managing each of these and the principal effects of these policies on the results for the period are summarised below: i. Risk management framework The Group’s Board has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Audit Committee is responsible for developing and monitoring the Group’s risk management policies. Risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls and to monitor risks and adherence to limits. All of these policies are regularly reviewed in order to reflect changes in the market conditions and the Group’s activities. The Audit Committee is assisted in its work by internal audit, conducted by PwC Ireland, which undertakes periodic reviews of different elements of risk management controls and procedures. ii. Market risk Market risk is the risk that the fair value or cash flows of a financial instrument will fluctuate due to changes in market prices. Market risk reflects interest rate risk, currency risk and other price risks. The Group has no financial assets or liabilities denominated in foreign currencies. The Group’s financial assets mainly comprise trade receivables. Financial liabilities comprise short-term payables, private placement notes and bank borrowings. Therefore the primary market risk is interest rate risk.

The Group has both fixed and variable rate borrowings. Variable rate borrowings consist of an unsecured revolving credit facility and the Group has partly hedged against increasing rates by entering into interest rate caps and swaptions to restrict EURIBOR costs to a maximum of 1%.

The following therefore illustrates the potential impact on profit and loss for the period of a 1% or 2% increase in EURIBOR:

As at 30 September 2019 (six months)

Impact on profit +1% Impact on profit +2% EURIBOR Increase EURIBOR Increase €’000 €’000 €’000 Amount drawn (166,645) (833) (1,666) Hedging (caps) 1 €100m expires November 2019: strike 1.00% 41,645 – 208 €125m expires November 2021: strike 0.75% 125,000 156 781 Impact on profit after hedging – for six months (677) (677)

1. This calculation uses the more advantageous hedge first and therefore shows the best-case scenario. As at 31 March 2019 (year)

Impact on profit Impact on profit

+1% EURIBOR +2% EURIBOR Increase Increase €’000 €’000 €’000 Amount drawn (159,413) (1,594) (3,188) Hedging (caps) €100m expires November 2019: strike 1.00%1 34,413 – 344 €125m expires November 2021: strike 0.75% 125,000 313 1,563 Impact on profit after hedging – for 12 months (1,281) (1,281)

1. This calculation uses the more advantageous hedge first and therefore shows the best-case scenario. Exposure to interest rates is limited to the exposure of the Group’s earnings from borrowings. Variable rate borrowings were €166.6m (March 2019: €159.4m) and net debt (note 24.b) was €221.5m in total of which €75.0m was fixed rate private placement notes (March 2019: €217.0m of which €75m was fixed). The Group’s drawings under its facilities were based on a EURIBOR rate of 0% throughout the period. iii. Credit risk Credit risk is the risk of loss of principal or loss of a financial reward stemming from a counterparty’s failure to repay a loan or otherwise meet a contractual obligation. Credit risk is therefore, for the Group and Company, the risk that the counterparties underlying its assets default.

The Group has the following types of financial assets and cash that are subject to credit risk:

Cash and cash equivalents: These are held with major Irish and European institutions. The Board has established a cash management policy for these funds which it monitors regularly. This policy includes ratings restrictions, BB or better, and related investment thresholds, maximum balances of €25–50m with individual institutions dependent on rating, to avoid concentration risks with any one counterparty. The Group has also engaged the services of a Depository to ensure the security of the cash assets.

Trade and other receivables: Rents are generally received one quarter in advance from tenants and therefore there tends to be a low level of credit risk associated with this asset class. The Group has small balances in trade receivables which are immaterial in the context of credit risk.

Trade receivables are managed under a “held to collect” business model as described in note 20.

Trade receivables and contract assets are written off when there is no reasonable expectation of recovery. Indicators that there are no reasonable expectations of recovery are, inter alia, the failure of a debtor to engage with the Group and make a payment plan, a failure to make contractual payments for more than 120 days, and the expectation that amounts may be irrecoverable as the tenant has vacated and refuses to engage further. The Group provided €53k against amounts likely to be irrecoverable at 30 September 2019. There were no such allowances made as at 31 March 2019.

The maximum amount of credit exposure is therefore:

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Other financial assets 11 194 Trade and other receivables 15,408 37,630 Cash and cash equivalents 25,327 22,372 Balance at end of period 40,746 60,196

49 iv. Liquidity risk Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group ensures that it has sufficient available funds to meet obligations as they fall due. Net current assets, a measure of the Group’s ability to meet its current liabilities, at the period end were:

As at 30 September 2019 As at 31 March 2019 unaudited audited €’000 €’000 Net current assets at the period end 4,701 40,692

The nature of the Group’s activities means that the management of cash is particularly important and is managed over a four-year period. The budget and forecasting process includes cash forecasting, capital and operational expenditure projections, cash in-flows and dividend payments on a quarterly basis over the four-year horizon. This allows the Group to monitor the adequacy of its financial arrangements.

The Group had access at 30 September 2019 to €153m (March 2019: €161m) in undrawn amounts under its revolving credit facility (note 24.a), which matures in December 2023.

Exposure to liquidity risk Listed below are the contractual maturities of the Group’s financial liabilities. Only trade and other payables relating to cash expenditure are included, the balance relates either to non-cash items or deferred income. These include interest margins payable and contracted repayments. EURIBOR is assumed at 0% throughout the period.

As at 30 September 2019 (unaudited)

Carrying amount Contractual cash flows 6 months or less 6-12 months 1-2 years 2-5 years >5 years Non-derivatives Borrowings 238,613 270,691 2,613 2,613 5,227 179,724 80,514 Trade payables 2,896 2,896 2,896 – – – Contract liabilities 2,428 2,428 2,428 – – – Total 243,937 276,015 7,937 2,613 5,227 179,724 80,514

At 31 March 2019 (audited)

Carrying amount Contractual cash flows 6 months or less 6-12 months 1-2 years 2-5 years >5 years Non-derivatives Borrowings 234,413 265,390 2,541 2,541 5,082 173,765 81,461 Trade payables 3,231 3,231 3,231 – – – – Contract liabilities 2,008 2,008 2,008 – – – – Total 239,652 270,629 7,780 2,541 5,082 173,765 81,461 v. Capital management The Group’s objectives when managing capital are to:

• Safeguard its ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders, and • Maintain an optimal capital structure to minimise the cost of capital.

In order to maintain or adjust capital, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. The Group commenced a share buyback programme during the period to return €25m, the majority of the net sales proceeds (€35m) from the sale of 77SJRQ. The Group is also obliged to distribute at least 85% of its property rental income under the REIT regime regulations.

Capital comprises share capital, reserves and retained earnings as disclosed in the condensed consolidated statement of changes in equity. At 30 September 2019 the total capital of the Group was €1,212m (March 2019: €1,219m).

The Key Performance Indicators used in evaluating the achievement of strategic objectives, and as performance measurements for remuneration, are as follows:

• Total Property Return (“TPR”) %: Measures the relative performance of the Company’s investment property portfolio versus the Irish property market, as calculated by the Investment Property Databank (“IPD”)/MSCI • Total Accounting Return (“TAR”) %: Measures the absolute growth in the Group’s EPRA NAV per share plus any ordinary dividends paid during the period. • EPRA earnings per share (cent): Measures the profit after tax excluding revaluations and gains and losses on disposals and associated taxation (if any). For property companies it is a key measure of a company’s operational performance and capacity to pay dividends. • Total Shareholder Return (“TSR”) %: Measures growth in share value over a period assuming dividends are re-invested in the purchase of shares. Allows comparison to other companies in the Group’s listed peer group.

The Group seeks to leverage its equity capital in order to enhance returns (note 24.a). The loan to value ratio (“LTV”) is expressed as net debt (note 24.b) divided by total investment property value (as shown in the balance sheet). The Group’s policy is to maintain an LTV ratio of 20-30% on a through cycle basis and not to incur debt above an LTV ratio of 40% (see note 24.b).

Loan covenants Under the terms of the major borrowing facilities, the Group is required to comply with the following key financial covenants:

• The LTV ratio must not exceed 50%; and • Interest cover must be greater than 1.5 times on both an historic and forward basis for a 12-month period.

The Group has complied with these key covenants throughout the reporting period.

Other In addition, the LTV ratio must remain under 50% under the rules of the Irish REIT regime.

The Company’s share capital is publicly traded on Euronext Dublin and the London Stock Exchange.

As the Company is authorised under the Alternative Investment Fund regulations it is required to maintain 25% of its annual fixed overheads as capital. This is managed through the Company’s risk management process. The limit was monitored throughout the period and no breaches occurred.

Section V – Other

This section contains notes that do not belong in any of the previous categories. 30. Capital commitments

The Group enters into development contracts to develop buildings in its portfolio. The total capital expenditure commitment in relation to these over the next one to two years is estimated at €32m (March 2019: €35m).

31. Contingent liabilities

Accounting policy See note 35 of the Annual Report 2019.

The Group has not identified any contingent liabilities which are required to be disclosed in the condensed consolidated financial statements.

32. Related parties

32.a Subsidiaries All transactions between the Company and its subsidiaries are eliminated on consolidation.

32.b Other related party transactions The rent review with WK Nowlan Real Estate Advisors, which was under review during the period ended 31 March 2019, was settled during the period. The Group earned rent of €205k (inclusive of backdated amounts) from WK Nowlan Real Estate Advisors in Marine House in the six months ended 30 September 2019 (March 2019: €115k). The Group was owed €20k in rent at the period end (March 2019: nil).

Both Kevin Nowlan and Frank O’Neill were shareholders in WK Nowlan Real Estate Advisors up until July 2019 when these shareholdings were disposed of in full.

William Nowlan was also previously a shareholder in WK Nowlan Real Estate Advisors. As part of his previous consultancy agreement with the Company, William Nowlan received €92k in consulting fees for the financial year ended 31 March 2019. Nothing was due to him at 31 March 2019. This consultancy arrangement had ceased prior to the commencement of this reporting period.

Amounts due in relation to the final tranche of the IMA performance related payments for the period ended 26 November 2018 were settled by the issuance of shares as follows: Kevin Nowlan: €2.3m, Frank Kenny: €1.5m, William Nowlan: €1.1m and Frank O’Neill: €0.5m. (March 2019: Kevin Nowlan: €2.8m, Frank Kenny: €1.8m, William Nowlan: €1.4m and Frank O’Neill: €0.6m).

As his consultancy agreement with the Company has ceased prior to the commencement of this reporting period, Frank Kenny earned no consultancy fees for the six months ended 30 September 2019 (March 2019: €140k). No amounts were owed to him in respect of consultancy fees at the period end (March 2019: €35k).

Thomas Edwards-Moss (CFO) rents an apartment from the Group at market rent and paid €6k in rent during the period (March 2019: €12k).

33. Events after the reporting period

1. Tax changes announced in Budget in October 2019 In the 2020 Budget (and the subsequent Finance Bill) the Irish Government announced a number of changes to the taxation of Irish property which can be categorised into those that directly impact the Group (whether immediately or potentially at some point in future) and those that do not. We summarise these changes below and estimate the impact for the Group where possible and/or appropriate. At present the Finance Bill is still subject to review and possible amendment: the final Finance Act is expected to be signed in December 2019.

Main tax changes directly impacting the Group

Overview Type of change Effective from Impact for Hibernia Stamp duty increased from 6% to 7.5% on Market change 9 October 2019 • Cushman & Wakefield, the Group’s valuer, all commercial property transactions in (unless a binding estimates that this change would have Ireland contract was in reduced the value of the Group’s portfolio place before this at 30 September 2019 by 1.6% (€22m) had date and it it been effective at that date completes by 31 • This is equates to a proforma 1.8% (3.3c) December 2019) reduction in the Group’s NAV per share at 30 September 2019 Increase in the rate of dividend withholding Market change 1 January 2020 • The change affects shareholders directly tax (“DWT”) from 20% to 25% for all • The impact will vary depending on the dividends paid by Irish companies individual circumstances of each shareholder and whether relief is available under a tax treaty Where an entity ceases to be a REIT, there REIT change 9 October 2019 • No immediate change for the Group will no longer be a deemed disposal and • If Hibernia ceased to be a REIT before the reacquisition of the assets at market value, expiry of the 15 year period (i.e. before unless the REIT has been in existence for 15 December 2028), this means the original years or more. tax basis in the assets would apply to subsequent disposals, not the market value at the date of cessation. • This could create latent tax for any bidder and reduce the price it would be prepared to pay to acquire the Group 85% of any proceeds a REIT generates from REIT change 9 October 2019 • No immediate impact the sale of a rental property which are not • Longer term impact uncertain until full reinvested within a three year window terms of this change are clear (spanning one year before and two years afterwards) or distributed to shareholders within two years of sale (and thus subject to DWT) will be taxed at 25% (an effective rate of 21.25% on the proceeds)

Schemes of arrangement: stamp duty on corporate acquisitions undertaken by a scheme of arrangement increased to 1% (previously 0%).

2. Share buyback The €25m buyback programme completed on 11 November 2019, at which point 17.6m shares had been repurchased and cancelled at an average price of €1.42 per share. 3. Interim dividend On 11 November 2019 the Directors approved the interim dividend of 1.75 cent per share (€12.0m) which will be paid on 23 January 2020 to shareholders on the register on 3 January 2020.

I. Alternative Performance Measures

The Group has applied the European Securities and Markets Authority (ESMA) “Guidelines on Alternative Performance Measures” in this report. An Alternative Performance Measure (“APM”) is a measure of financial or future performance, position or cash flows of the Group which is not a measure defined by International Financial Reporting Standards (“IFRS”).

The following are the APMs used in this report together with information on their calculation and relevance.

APM Reconciled to IFRS measure: Reference Definition Contracted rent roll n/a n/a Contracted rent under the lease agreements, and excluding all incentives or rent abatements, for the portfolio as at the reporting date. EPRA cost ratios IFRS operating expenses II.b Calculated using all administrative and operating expenses under IFRS net of service fees. It is calculated including and excluding vacancy costs. EPRA earnings IFRS profit after tax II.a As EPRA earnings is used to measure the operational performance of the Group, it excludes all components not relevant to the underlying net income performance of the portfolio, such as the change in value of the underlying investments and any gains or losses from the sales of investment properties. EPRA earnings per share (“EPRA IFRS earnings per share Note 13 EPRA earnings on a per share basis. EPS”) II.a EPRA like-for-like rental growth n/a II.d Like-for-like rental growth compares the reporting growth of the net rental income of the portfolio that has been consistently in operation, and not under development, during the two full preceding periods that are described. EPRA NAV IFRS NAV Note 14 The objective of the EPRA NAV measure is to II.f highlight the fair value of net assets on an ongoing, long-term basis. Assets and liabilities that are not expected to crystallise in normal circumstances such as the fair value of financial derivatives and deferred taxes on property valuation surpluses are therefore excluded. EPRA NAV per share IFRS NAV per share Note 14 EPRA NAV calculated on a diluted basis II.f taking into account the impact of any options, convertibles, etc. that are “dilutive”. EPRA NNNAV IFRS NAV per share via EPRA II.f Reports EPRA NAV including fair value NAV per share adjustments for any material balance sheet items which are not included in EPRA NAV at fair value. IFRS NAV per share via EPRA NAV IFRS NAV per share via EPRA II.f Reports EPRA NAV including fair value per share NAV per share adjustments for any material balance sheet items which are not included in EPRA NAV at fair value and calculated on a dilutive basis. EPRA Net Initial Yield (“EPRA n/a II.e Inherent yield of the completed portfolio NIY”) using passing rent at the reporting date. EPRA topped-up Net Initial Yield n/a II.e Inherent yield of the completed portfolio (“EPRA topped-up NIY”) using contracted rent at the reporting date. EPRA vacancy rate n/a II.c ERV of the vacant space over the total ERV of the completed portfolio. Loan to value (“LTV”) n/a Note 24.b Net debt as a proportion of the value of investment properties

APM Reconciled to IFRS measure: Reference Definition Final and interim dividend per Dividend per share Note 12 Number of cent to be distributed to share shareholders in dividends. Net debt Financial liabilities Note 24.b Financial liabilities net of cash balances (as reduced by the amounts collected from tenants for deposits, sinking funds and similar) available. Passing rent n/a n/a Annualised gross property rent receivable on a cash basis as at the reporting date. Property-related capital II.g.ii Property-related capital expenditure expenditure analysed so as to illustrate the element of such expenditure that is “maintenance” rather than investment. Reversionary potential n/a II.g.i Potential rent uplift available from leases with break dates, expiring or review events in future periods. Total accounting return (“TAR”) Indirectly through EPRA NAV Note 14 Measures the absolute growth in the Group’s EPRA NAV per share plus any ordinary dividends paid in the accounting period. Total property return (“TPR”) n/a n/a Total property return is the return for the period of the property portfolio (capital and income) as calculated by MSCI, the producers of the MSCI Ireland Property Index.

II. European Public Real Estate Association (“EPRA”) Performance Measures (unaudited)

EPRA Performance Measures are calculated according to the EPRA Best Practices Recommendations November 2016. EPRA Performance Measures are used in order to enhance transparency and comparability with other public real estate companies in Europe. EPRA has consulted investors and preparers of information in order to compile its recommendations. Using these measures ensures that the Group’s investors can compare the Group’s performance on a like-for-like basis with similar companies.

Further details on these measures are set out below, including their calculation and reconciliation to the financial statements where applicable.

Six months ended Six months ended EPRA performance measure Unit 30 September 2019 30 September 2018 EPRA earnings €’000 19,284 12,849

EPRA EPS cent 2.8 1.8

Diluted EPRA EPS cent 2.8 1.8

EPRA cost ratio - including direct vacancy costs % 23.3% 42.5%

EPRA cost ratio - excluding direct vacancy costs % 22.1% 41.1%

EPRA performance measure Unit As at 30 September 2019 As at 31 March 2019 EPRA net initial yield (“NIY”) % 3.6% 3.6%

EPRA “topped-up” NIY % 4.2% 4.1%

EPRA net asset value (“EPRA NAV”) €’000 1,212,516 1,219,374

EPRA NAV per share cent 175.7 173.3

EPRA triple net assets (“EPRA NNNAV”) €’000 1,203,540 1,218,539

EPRA NNNAV per share cent 174.4 173.2

Like-for-like rental growth % 9.1% 7.6%

EPRA vacancy rate % 10.8% 10.7%

II.a EPRA earnings

EPRA earnings are presented as they are important for investors who want to assess the extent to which dividends are supported by recurring income.

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 unaudited unaudited audited EPRA earnings per share and diluted EPRA earnings per share Notes €’000 €’000 €’000 Profit for the period attributable to the owners of the Company 25,525 63,960 123,459 Less: Gains and losses on investment property 7 (6,288) (51,131) (98,105) Profit or (loss) on disposals of other assets – – (140) Deferred tax in respect of EPRA adjustments – – 547 Changes in fair value of financial instruments and associated close- out costs 47 20 1,711 EPRA earnings 19,284 12,849 27,472

‘000 ‘000 ‘000 Weighted average number of ordinary shares (basic) 13 692,330 694,968 694,968 Weighted average number of ordinary shares (diluted) 13 693,655 698,695 700,996 EPRA earnings per share (cent) 2.8 1.8 4.0 Diluted EPRA earnings per share (cent) 2.8 1.8 3.9

II.b EPRA cost ratio

EPRA costs are calculated below.

Six months ended Six months ended Financial year ended 30 September 2019 30 September 2018 31 March 2019 €’000 €’000 €’000 Total operating expenses under IFRS 5,753 10,444 19,291 Property expenses 1,210 1,543 2,596 Net service charge costs/fees (39 ) (41 ) 122 EPRA costs including direct vacancy costs 6,924 11,946 22,009 Direct vacancy costs (357 ) (374 ) (545 ) EPRA costs excluding direct vacancy costs 6,567 11,572 21,464 Gross rental income 29,749 28,134 56,027 EPRA cost ratio including direct vacancy costs 23.3% 42.5% 39.3% EPRA cost ratio excluding direct vacancy costs 22.1% 41.1% 38.3%

The Group has not capitalised any overheads in the current period or the prior financial year.

II.c EPRA vacancy rate

This provides comparable and consistent vacancy data for investors based on the independent valuer’s assessment of ERV. The EPRA vacancy rate measures the ERV of vacant space expressed as a percentage of the total ERV (including Iconic arrangement).

Six months ended Financial year ended 30 September 2019 31 March 2019 €‘000 €‘000

Annualised ERV vacant units 7,824 7,265 Annualised ERV completed portfolio 72,424 67,760

EPRA vacancy rate 10.8% 10.7%

II.d EPRA like-for-like rental growth

Like-for-like net rental growth compares the growth of the net rental income of the portfolio that has been consistently in operation, and not under development, during the two full preceding periods that are described. Information on the growth in rental income other than from acquisitions and disposals, allows stakeholders to arrive at an estimate of organic growth. This can be used to measure whether the reversions feed through as anticipated, and whether the vacancy rates are changing. This measure excludes rental income on

55 disposals and acquisitions and properties under development or refurbishment during the period. All rental income is from properties based in Dublin, Ireland and the greater Dublin area.

Six months ended 30 September 2019

Whole portfolio Like for like portfolio – six months to 30 September 2019 v six months to 31 March 2019 Value - all Net rental Value L-f-L Net rental income L-f-L Net rental income L-f- Segment assets income assets assets current period L assets prior period Growth in net rental income €'m €'m €'m €'m €'m €'m % Office assets 1,186.6 25.1 965.9 23.0 20.9 2.1 9.9% Residential assets 154.9 3.0 144.9 3.0 2.8 0.2 5.8% Industrial/land assets 60.3 0.5 17.7 0.6 0.6 – (2.2)%

Total in-place portfolio 1,401,8 28.6 1,128.5 26.6 24.3 2.3 9.1% Development assets 21.9 – Assets sold – – Total portfolio 1,423.7 28.6 Buildings excluded from L-f-L as at 30 September 2019 Developments/refurbishments concluded: 1-6 SJRQ & 2WML, Cannon Place apartments Developments in progress/sites: 2 Cumberland Place, Newlands (Gateway) Properties acquired: 128 Slaney Road Industrial Park, Clanwilliam Apartments, Malahide Road Industrial Unit

Six months ended 30 September 2018

Whole portfolio Like for like portfolio – six months to 30 September 2018 v six months to 31 March 2018 Value - all Net rental Value L-f-L Net rental income L-f-L Net rental income L-f- Segment assets income assets assets current period L assets prior period Growth in net rental income €'m €'m €'m €'m €'m €'m % Office assets 985 22.3 722 17.6 16.2 1.4 8.5% Residential assets 148 2.7 130 2.6 2.6 0.0 1.0% Industrial/land assets 24 0.4 13 0.4 0.3 0.1 13.2%

Total in-place portfolio 1,157 25.4 865 20.6 19.1 1.5 7.6% Development assets 173 – Assets sold – 1.2 Total portfolio 1,330 26.6 Buildings excluded from this L-f-L: Developments/refurbishments concluded: 1WML, Two Dockland Central, Hannover Mills, Cannon Place apartments. Developments in progress/sites: 2 Windmill Lane, Sir John Rogerson’s Quay (1-6), 2 Cumberland Place, Gateway lands Properties acquired: 77 Sir John Rogerson’s Quay, 50 City Quay, 129 Slaney Road Industrial Park, Clanwilliam apartments Properties sold: New Century House (the Chancery, Hannover Street East and Lime Street sold in the six months ended 31 March 2018)

II.e EPRA Net Initial Yield (“EPRA NIY”) and EPRA “topped-up” Net Initial Yield

EPRA NIY: This measures the inherent yield of the portfolio according to set guidelines to allow investors to compare real estate investment companies across Europe on a consistent basis, using current cash passing rent. EPRA “topped-up” NIY: This measures the yield based on rents adjusted for the expiration of lease incentives, i.e. on a contracted rent basis.

As at 30 September 2019

Office Residential Industrial/Land Total Development €’000 €’000 €’000 €’000 €’000 €’000 Investment property at fair value1 1,192,832 154,869 60,349 1,408,050 21,899 1,429,949 Less: Development/refurbishment – – (35,500)2 (35,500) (21,899) (57,399) Completed property portfolio 1,192,832 154,869 24,849 1,372,550 – 1,372,550 Allowance for purchasers’ costs3 100,914 6,907 5,106 112,927 Gross up completed property portfolio 1,293,746 161,776 29,955 1,485,477 Annualised cash passing rental income4 46,933 7,044 1,515 55,492 Property outgoings5 (959) (1,168) (10) (2,137) Annualised net rents 45,974 5,876 1,505 53,355 Expiry of lease incentives and fixed uplifts6 8,727 – 108 8,835 “Topped-up” annualised net rent 54,701 5,876 1,613 62,190 EPRA NIY 3.6% 3.6% 5.0% 3.6% EPRA “Topped-up” NIY 4.2% 3.6% 5.4% 4.2% 1. Investment property includes SDHS which has been leased to a third party but which has not yet been transferred from fixed assets to investment property for technical reasons. 2. Lands at Newlands are excluded as held for future development 3. Purchasers’ costs at 30 September 2019 were 8.46% for commercial and 4.46% for residential 4. Cash passing rent includes residential rents gross as property outgoings are included separately 5. Annualised basis at current vacancy levels 6. Expiry of lease incentives and fixed uplifts are mainly within one year

As at 31 March 2019

Office Residential Industrial/Land Total Development €’000 €’000 €’000 €’000 €’000 €’000 Investment property at fair value 1,173,140 153,079 53,000 1,379,219 16,199 1,395,418 Less: Development/refurbishment – – (35,500)1 (35,500) (16,199) (51,699) Completed property portfolio 1,173,140 153,079 17,500 1,343,719 – 1,343,719 Allowance for purchasers’ costs2 99,248 6,827 1,481 107,556 Gross up completed property portfolio 1,272,388 159,906 18,981 1,451,275 Annualised cash passing rental income3 46,401 7,099 1,135 54,635 Property outgoings (755) (1,232) (31) (2,018) Annualised net rents 45,646 5,867 1,104 52,617 Expiry of lease incentives and fixed uplifts4 6,929 – 130 7,059 “Topped-up” annualised net rent 52,575 5,867 1,234 59,676 EPRA NIY 3.6% 3.7% 5.8% 3.6% EPRA “Topped-up” NIY 4.1% 3.7% 6.5% 4.1% 1. Lands at Newlands are excluded as held for future development 2. Purchasers’ costs are 8.46% for commercial and 4.46% for residential 3. Cash passing rent includes residential rents gross as property outgoings are included separately 4. Expiry of lease incentives and fixed uplifts are mainly within one year

II.f EPRA NAV and EPRA NNNAV

The objective of these measures is to highlight the fair value of net assets on an ongoing, long-term basis. Therefore assets which are not expected to crystallise in normal circumstances are excluded while trading properties are adjusted to their fair value. The Group presents its investment properties in its financial statements at fair value as allowed under IAS 40 and has no items not expected to crystallise in a long-term investment property business model. The fair value of derivative instruments is excluded from EPRA NAV on the basis that these are hedging instruments and intended to be held to maturity. EPRA NNNAV is the EPRA NAV adjusted to reflect the fair value of debt and derivatives and to include deferred taxation on revaluations (if any).

’000 ’000 EPRA NAV 1,212,516 1,219,374 Net mark to market on financial assets (347) (288) Fair value of debt1 (8,082) - Deferred tax (547) (547) EPRA NNNAV 1,203,540 1,218,539 Diluted number of shares (‘000) 690,285 703,617 EPRA NNNAV per share (cent) 174.4 173.2

1. Difference in fair value of fixed rate private placement notes versus book value (amortised cost)

II.g Portfolio information

Portfolio information can be generally found in the business review section of this report. Below is further information based on the guidelines issued by EPRA. i. Reversionary potential The following data is calculated for the “in-place” office and industrial portfolio (inclusive of the Iconic arrangement) and based on the earliest of review, break or expiry dates. Residential data is excluded as reversion to ERV is limited to 4% in rent-controlled areas where all the residential assets are based, and all leases roll on average annually. Contracted rent is used to avoid overstating uplifts to ERV as fixed uplifts are generally in the first year of lease and are accounted for on a smoothed period over the lease term in the financial data. Further details on portfolio rent statistics can be found in the business review.

30 September 2019

Rent subject to rent reviews Period end 30 September 2020 2021 2022-2024 >2024 Total Contracted rent 2.8 2.0 9.8 19.5 34.1 Uplift to ERV1 0.9 0.2 0.5 (0.1) 1.5 Total 3.7 2.2 10.3 19.4 35.6

% increase/(decrease) possible 32% 11% 5% – 4% From vacant space 7.4 – – – 7.4 Total 11.1 2.2 10.3 19.4 43.0

Rent subject to break or expiry Period end 30 September 2020 2021 2022-2024 >2024 Total Contracted rent 1.3 3.2 3.3 14.8 22.6 Uplift to ERV – (0.2) – (0.4) (0.6) Total 1.3 3.0 3.3 14.4 22.0 % increase possible – (7)% 0% (3)% (3)%

Total reversion from review and break/expiry (excluding vacancy) Total contracted rent 4.1 5.1 13.1 34.3 56.6 Total uplift to ERV 0.9 – 0.5 (0.5) 0.9 % increase possible 21.9% – 3.8% (1.4)% 1.6% % increase possible including vacancy 14.8% As at 31 March 2019

Rent subject to rent reviews Financial year ended 31 March 2020 2021 2022-2024 >2024 Total Contracted rent 3.9 1.6 19.9 8.9 34.3 Uplift to ERV1 3.1 – (0.1) 0.2 3.2 Total 7.0 1.6 19.8 9.1 37.5

% increase/(decrease) possible 80% 0% (1)% 2% 9%

From vacant space 7.4 – – – 7.4 Total 14.4 1.6 19.8 9.1 44.9

Rent subject to break or expiry Financial year ended 31 March 2020 2021 2022-2024 >2024 Total Contracted rent 1.9 2.7 13.6 – 18.2 Uplift to ERV 0.7 – (0.3) – 0.4 Total 2.6 2.7 13.3 – 18.6 % increase possible 37% – (2)% – 2 %

Total reversion from review and break/expiry (excluding vacancy ) Total contracted rent 5.8 4.3 33.5 8.9 52.5 Total uplift to ERV 3.8 - (0.4) 0.2 3.6 % increase possible 53% - (1)% 2% 7% % increase possible including vacancy 21% 1. ERV uplift includes all “in-place” office potential uplifts. The Group may develop some of these properties in the longer term and therefore these reversions may not be obtained.

58 ii. Property-related capital expenditure (“capex”) Capital expenditure on the investment portfolio analysed to allow an understanding of the investment in the portfolio during the period. Further information on capex is available in note 15 to the condensed consolidated financial statements as well as in the business review section of this report.

Six months ended Financial year ended 30 September 2019 31 March 2019 unaudited audited €’m €’m Acquisitions 17.1 40.0 Analysed further as: Purchases of investment property 17.6 40.0 In-place portfolio – VAT refund received relating to the acquisition of 2DC (0.5) -

Capital expenditure 10.7 47.2 Analysed further as: Developments1 9.3 44.8 Maintenance capex 0.3 0.3 Other2 1.1 2.1 Total capital expenditure for period 27.8 87.2

1. This comprises expenditure on 1SJRQ, 1&2WML, 2 Dockland Central, and 2 Cumberland Place 2. This is financing expenses capitalised and expenditure on existing properties in relation to future planning for redevelopment.

Directors and Other Information

Directors Daniel Kitchen (Chairman) Colm Barrington (Senior Independent Director) Roisin Brennan Thomas Edwards-Moss (CFO) Stewart Harrington Grainne Hollywood (appointed 5 November 2019) Frank Kenny Kevin Nowlan (CEO) Terence O'Rourke Company Secretary Sean O’Dwyer Assistant Secretary Sanne Corporate Administration Services Ireland Limited t/a Sanne 4th Floor 76 Lower Baggot Street Dublin D02 EK81 Ireland Registered office South Dock House Hanover Quay Dublin D02 XW94 Ireland Company number 531267 Independent auditor Deloitte Ireland LLP Chartered Accountants and Statutory Audit Firm Hardwicke House Hatch Street Dublin D02 ND96 Ireland Tax adviser KPMG 1 Stokes Place St. Stephen’s Green Dublin D02 DE03 Ireland Independent valuer Cushman & Wakefield 164 Shelbourne Road Ballsbridge Dublin 4 Ireland Principal banker Bank of Ireland 2 Burlington Plaza Burlington Road Dublin 4 Ireland

Depositary BNP Paribas Securities Services, Dublin Branch Trinity Point 10-11 Leinster Street South Dublin D02 EF85 Ireland

Registrar Link Registrars Limited t/a Link Asset Services 2 Grand Canal Square Dublin D02 A342 Ireland Principal legal adviser A&L Goodbody 25/28 North Wall Quay IFSC Dublin D01 H104 Ireland Corporate brokers Goodbody Stockbrokers Ballsbridge Park Ballsbridge D04 YW83 Ireland

Credit Suisse International One Cabot Square London E14 40J United Kingdom 60

Glossary AIF is an Alternative Investment Fund

AIFM is an Alternative Investment Fund Manager

Brexit is the UK exit from the EU.

Cash passing rent is the gross property rent receivable on a cash basis as at the reporting date. It includes sundry items such as car parks rent and estimates of rents in respect of unsettled rent reviews.

CBD is Central Business District.

Contracted rent is the annualised rent adjusted for the inclusion of rent that is subject to a rental incentive such as a rent-free period or reduced rent year.

Developer’s profit is the profit on cost estimated by valuers which is typically a percentage of developer’s costs, usually between 10% and 25%.

Development construction cost is the total costs of construction to completion, excluding site and financing costs. Finance costs are usually assumed at a notional 7% per annum by the valuers.

DoF is the Department of Finance.

DPS is dividend per share.

DRIP or dividend reinvestment plan is a plan offered by the Group that allows investors to reinvest their cash dividends by purchasing additional shares on the dividend payment date.

EPRA is the European Public Real Estate Association, which is the industry body for European property companies. It produces guidelines for number of standardised performance measures (e.g. EPRA earnings, EPRA NAV).

EPRA cost ratio (including direct vacancy costs) is the ratio of net overheads and operating expenses against gross rental income. Net overheads and operating expenses relate to all administrative and operating expenses net of any service fees, recharges or other income which is specifically intended to cover overhead and property expenses.

EPRA cost ratio (excluding direct vacancy costs) is the same as above except it excludes direct vacancy costs.

EPRA earnings is the profit after tax excluding revaluations and gains and losses on disposals and associated taxation (if any).

EPRA NAV per share is the EPRA NAV divided by the diluted number of shares at the period end.

EPRA net asset value (“EPRA NAV”) is defined as the IFRS assets excluding the mark to market on effective cash flow hedges and related debt instruments and deferred taxation on revaluations.

EPRA net initial yield (“NIY”) is the passing rent generated by the investment portfolio at the balance sheet date, less estimated recurring irrecoverable property costs, expressed as a percentage of the portfolio valuation as adjusted. The portfolio valuation is adjusted by the exclusion of development properties and those under refurbishment.

EPRA NNNAV is the EPRA NAV adjusted to reflect the fair value of debt and derivatives and to include deferred taxation on revaluations.

EPRA topped-up net initial yield is calculated as the EPRA NIY but adjusting the passing rent for contractually agreed uplifts, where these are not in lieu of rental growth.

EPRA vacancy rate is the Estimated Rental Value (“ERV”) of vacant space divided by the ERV of the whole portfolio, excluding developments and residential property. This is the inverse of the occupancy rate.

EPS or earnings per share is the profit after taxation divided by the weighted average number of shares in issue during the period

Equivalent yield is the weighted average of the initial yield and reversionary yield and represents the return that a property will produce based on the occupancy data of the tenant leases.

ERV or Estimated rental value is the external valuer’s opinion as to what the open market rental value of the property is on the valuation date, and which could reasonably be expected to be the rent obtainable on a new letting on that property on the valuation date.

Fair value movement is the accounting adjustment to change the book value of the asset or liability to its market value.

FRI lease is a full repairing and insuring lease

GRESB is the Global ESG benchmark for real estate assets.

Gross rental income is the accounting based rental income under IFRS. When the Group provides incentives to its tenants the incentives are recognised over the lease term on a straight-line basis in accordance with IFRS. Gross rental income is therefore the passing rent as adjusted for the spreading of these incentives.

Hibernia is Hibernia REIT plc, the Group or the Company. 61

In-place portfolio is the portfolio of completed properties, i.e. excluding active development and refurbishment projects and land.

Internalisation refers to the acquisition of the Investment Manager and the ultimate elimination of reliance on the external investment management function through bringing these activities inside the Group.

IPO is the initial public offering, i.e. the first equity raising of the Company.

IPD is the Investment Property Databank Limited which is part of the MSCI Group and produces as independent benchmark of property returns (IPD Ireland Index) and which provides the Group with the performance information required in calculating the performance- based management fee.

IPMS are the international property measurement standards as issued by the Royal Institute of Chartered Surveyors

IRR is internal rate of return.

MSC Ireland Property Index is the MSCI/SCSI/Investment Property Databank Limited Ireland Quarterly Property Index-All Property (the ‘‘IPD Ireland Index’’)

Lease incentive is any consideration or expense, borne by the Group, in order to secure a lease.

LEED (“Leadership in Energy and Environmental Design”) is a Green Building Certification System developed by the US Green Building Council (USGBC). Its aim is to be an objective measure of building sustainability.

Like for like rental income growth is the growth in net rental income on properties owned through the current and previous periods under review. This growth rate includes revenue recognition and lease accounting adjustments but excludes properties held for development in either period or properties with guaranteed rental reviews.

Loan to value (“LTV”) is the ratio of the Group’s net debt to the value of its investment properties.

Long-term incentive plan (“LTIP”) aims to encourage staff retention and align their interests with those of the Group through the payment of rewards based on the Company and individual’s performance through shares in the Company that vest after a future period of service.

Market abuse regulations are issued by the Central Bank of Ireland and can be accessed on https://www.centralbank.ie/regulation/securities-markets/market-abuse/Pages/default.aspx.

NAVPS is the net asset value in cent per share.

Net development value is the external valuer’s view on the end value of a development property when the building is fully completed and let.

Net equivalent yield is the weighted average income return (after allowing for notional purchaser’s costs) a property will produce based on the timing of the income received. As is normal practice, the equivalent yields (as determined by the external valuers) assumes rent is received annually in arrears.

Net reversionary yield is the expected yield after the rent reverts to the ERV.

Net lettable or net internal area (“NIA”) is the usable area within a building measured to the internal face of the perimeter walls at each floor level.

Occupancy rate is the estimated rental value of let units as a percentage of the total estimated rental value of the portfolio, excluding development properties.

Over rented is used to describe when the contracted rent is higher than the ERV.

Passing rent is the annualised gross property rent receivable on a cash basis as at the reporting date. It includes sundry items such as car parks rent and estimates of rents in respect of unsettled rent reviews.

Property income distributions (“PIDs”) are dividends distributed by a REIT that are subject to taxation in the hands of the shareholders. Normal withholding tax still applies in most cases.

PRS is the private rented sector which refers to residential properties held for rent.

Psf is per square foot

REIT is a Real Estate Investment Trust. Irish REITs comply with section 705E of the Taxes Consolidation Act 1997.

Remuneration Policy: the remuneration policy approved by shareholders at the 2018 AGM and which took effect from 27 November 2018.

Reversion is the rent uplift where the ERV is higher than the contracted rent.

Royal Institute of Chartered Surveyors (“RICS”) Professional Standards, RICS Global Valuation Practice Statements and the RICS Global Valuation Practice Guidance – Applications contained within the RICS Valuation – Global Standards 2017 (the “Red Book”) issued by the Royal Institute of Chartered Surveyors provide the standards for preparing valuations on property. 62

Sq. ft. is square feet.

Tenant or lease incentives are incentives offered to occupiers on entering into a new lease and may include a rent free or reduced rent period, or a cash contribution to fit-out. Rental income for the lease period is “smoothed”, i.e. the impact of these incentives is recognised over the term of the lease to the next break or expiry date.

Term certain is the lease period to the next break or expiry.

TMT sector is the technology, media and telecommunications sector.

Total accounting return (“TAR”) measures the absolute growth in the Group’s EPRA NAV per share plus any ordinary dividends paid.

Total Property Return (“TPR”) is the return for the period of the property portfolio (capital and income) as calculated by MSCI, the producers of the IPD Ireland Index.

Total shareholder return (“TSR”) is the growth in share value over a period assuming dividends are reinvested to purchase additional units of stock.

Transparency regulations enhance the information made available about issuers whose securities are admitted to trading on a regulated market and further information is available on https://www.centralbank.ie/regulation/securities-markets/transparency/Pages/default.aspx.

Under rented is the term used to describe where contracted rents are lower than ERV. This implies a positive reversion after expiry of the current lease contract terms.

Ungeared IRR is the internal rate of return excluding gearing.

Valuer is the independent valuer appointed by the Group to value the Group’s investment properties at the date of the consolidated financial statements. From September 2017 the Group has used Cushman and Wakefield. Previously the Group has used CBRE.

WAULT is weighted average unexpired lease term and is variously calculated to break, expiry or next review date.