11th Sep 2018 12:18
LONDON (Alliance News) - Regional REIT Ltd on Tuesday reported a more than doubling of its interim profit as net rental income increased, leading to a higher dividend payout.
Regional REIT, a UK regional office and industrial property focused real estate investment trust, increased its interim pretax profit to GBP pretax profit GBP45.3 million from GBP16.2 million the year before.
The company's EPRA net asset value increased to GBP426.5 million from GBP395.7 million at the end of the year.
NAV per share increased to 113.7 pence from 107.1p a year before and 105.4 pence at the end of the previous half.
In the six months ended June, revenue increased 33% to GBP30.6 million from GBP23.0 million, with net rental income increasing 38% to GBP26.9 million from GBP19.5 million.
Regional REIT said the increase was primarily the result of its enlarged investment property portfolio.
The trust's gross portfolio value increased 18% in the period to GBP758.7 million from GBP640.4 million.
Regional REIT also had a "significant" number of disposals in the period, totalling GBP60.4 million at an average net yield of 4.9%, up from GBP3.7 million the year before.
The company said it "took advantage of the mismatch between valuations and market demand".
Occupancy levels increased to 85.5% from 85.0% in the period - mainly due to the company completing 33 new leases in 2018.
Regional REIT declared an interim dividend of 3.7p, up 2.8% from last year's 3.6p. The company said it is "committed" to paying a total dividend of 8.05p
Looking ahead, the company said it remains "positive" despite an "uncertain" political and economic backdrop.
Chief Executive Officer of London & Scottish Investments, Asset Manager to Regional REIT, Stephen Inglis said: "The first half has once again been active for the REIT and demonstrated our ability to create real value improvements through asset management; demonstrated in the increase in the first half valuation.
"While we continue to acquire opportunistically, we have disposed of assets that were at the end of our asset management programme or taken advantage of a mismatch between valuations and market values. This has significantly driven profit in the period, as well as changed the makeup of our portfolio, as much of the capital has been reinvested into less mature assets where there are opportunities to increase value."
Shares in Regional REIT were up 3.3% Tuesday at 98.40 pence each.
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Regional Reit