15th May 2025 11:00
(Alliance News) - Grainger PLC on Thursday reported an increased dividend and net rental income, and said it expects strong rental and earnings growth to continue.
The Newcastle Upon Tyne, England-based residential landlord said pretax profit in the half year ended March 31 totalled GBP74.0 million, swinging from the prior year's GBP31.2 million loss.
Grainger also reported basic and diluted earnings per share of 7.5 pence, against a 3.0p loss.
Group revenue increased to GBP136.4 million from GBP113.7 million, and net rental income increased to GBP61.3 million from GBP53.2 million, which Chief Executive Helen Gordon said was "driven by our new openings, growth in underlying rents and our ability to leverage our central costs and operational platform".
"Our properties are in high demand and our portfolio remains fully let with occupancy at 96% with a strong customer demographic base and stable and healthy levels of affordability," she continued. "The expansion of our BTR portfolio is accelerating our earnings growth."
Grainger declared an interim dividend of 2.85p per share, up 12% from 2.54p.
It also noted that EPRA earnings totalled GBP30.2 million, up 23% from GBP24.5 million.
"Residential, specifically private rented residential, has proven its resilience through the cycle compared to other real estate asset classes with excellent rental growth protecting valuations and we are seeing continued valuation growth," Gordon said. "Investment activity in the build-to-rent sector is very buoyant with reports of more than [GBP1 billion] of investment activity in Q1 this year.
"Our market is characterised by structural demand drivers, supply-constrained markets, strong customer demographics and a supportive regulatory and political backdrop which is aimed at stimulating investment activity."
Looking ahead, Grainger described the outlook as "excellent" with inflation expected to support continued strong underlying like-for-like rental growth. It also said it anticipates continued on-year compounding earnings growth, and that buoyant build-to-rent sector activity will continue supporting property valuations.
"Through the delivery of the first part of our pipeline, our committed pipeline, we expect to deliver strong like-for-like rental growth and 50% earnings growth from FY24 to FY29 after fully absorbing the impact of higher interest costs," Gordon commented. "We have significant firepower from our non-core portfolio to fund growth beyond that for our remaining pipeline or additional stabilised acquisitions.
"We operate in a sector with strong structural tailwinds. Our asset class and specifically our portfolio and platform, deliver inflation-backed rental growth.
"Our sector leading operating platform is scalable and our Ebitda margins are growing substantially as we deliver our large pipeline. This shareholder value creation model creates excellent, risk-adjusted returns, with a commitment to delivering a continued progressive dividend."
Shares in Grainger were trading 2.1% higher at 218.00p on Thursday morning in London.
By Emma Curzon, Alliance News reporter
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