4th Jun 2024 12:23
(Alliance News) - LondonMetric Property PLC on Tuesday delivered an "impressive" period of operational growth despite wider sector challenges, analysts on Tuesday said.
The London-based real estate investment trust swung to GBP120.0 million pretax profit in the year ended March 31 from a GBP507.5 million pretax loss the previous year.
LondonMetric reported a GBP7.5 million loss on revaluation of investment properties, significantly improved from GBP577.4 million in financial 2023.
Rental income rose 22% to GBP175.3 million from GBP144.1 million.
LondonMetric declared a final dividend of 3.00 pence per share, up 15% from 2.60p. That brought the total dividend for the year to 10.20p, improving by 7.4% from 9.50p, making for the nineth consecutive year of dividend progression.
The company strengthened its cash position to GBP114.1 million from GBP36.5 million.
Shore Capital analyst Andrew Saunders said the results confirmed continued underlying progress in rental income, earnings and dividends in a busy year that also included two major corporate acquisitions.
Saunders noted the financial year saw LondonMetric make two major corporate acquisitions – the GBP1.9 billion acquisition of LXi REIT and the GBP285 million acquisition of CT Property Trust.
"Both deals made good strategic sense to us having largely complementary portfolios, strong balance sheets and [loan-to-values], short-notice external management contracts and attractive cost savings/synergy benefits," Saunders added.
As for the results, the Shore Capital analyst said LondonMetric has once again delivered an "impressive period of operational growth despite the wider sector challenges".
"With a well-positioned portfolio and debt-book the company has been able to consistently deliver growth in rents, earnings and dividends for its shareholders – and on-track for a tenth consecutive year of dividend growth…placing it in an exclusive club within the sector," he added.
Further, as the 4th largest UK REIT, the company now has "serious scale" and can expect to "eat at the industry top-table" for further deals as the market increasingly bifurcates between the best and the rest.
The shares look good value, Saunders believes.
Shares in LondonMetric were down 1.3% to 205.40 pence in London on Tuesday.
By Jeremy Cutler, Alliance News reporter
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