12th Mar 2019 11:24
LONDON (Alliance News) - PRS REIT PLC said on Tuesday it saw a strong rise in profit for the interim, as it continued to grow its portfolio of private rented sector units, leading to a rise in rental income.
PRS REIT reported an EPRA net asset value of 96.3 pence as at December 31, down from 98.2p the same date the year before, following the payment of dividends since the launch of the trust.
However, net assets nearly doubled year-on-year to GBP477.2 million from GBP245.5 million.
Profit from operations rose to GBP7.3 million from GBP347,000, following total expenses of GBP2.8 million and gains from fair value adjustment on investment properties of GBP8.2 million.
Pretax profit rose significantly to GBP7.5 million from GBP539,000 the year before, as rental income rose to GBP2.3 million from GBP600,000.
The rise in profit and income was due to the enlarging of PRS REIT's portfolio during the period, which increased to 3,575 homes as at the end of December, with an estimated rental value of GBP33.2 million and a gross development cost of GBP530.0 million.
During the period, the number of homes completed and contracted was 2,166, with an estimated rental value of GBP20.2 million and gross development cost of GBP328.5 million.
PRS declared an interim dividend of 2.0 pence per share, and is targeting a dividend of 5.0 pence per share for its current financial year and beyond until 2022.
Looking ahead, PRS REIT said it expects short term headwinds from expected planning approval delays, and as a result has lowered its established covered dividend target to 5.5 pence per share from 6.0p for 2022.
However the trust "views long term prospects with confidence."
"Outside these delays, the model is working well, with delivery and operational costs in line with expectations, continuing high demand for our homes, and good visibility on the deployment of the remaining tranches of our gross capital," said Chair Steve Smith.
"Housing for the family rental market remains critically undersupplied and the opportunity for the company to establish itself as a major provider of high quality, professionally managed houses in the UK remains substantial. Consequently, the board continues to view long term prospects with confidence," Smith added.
Shares in PRS REIT were down 2.3% at 99.62 pence on Tuesday.
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