24th Jul 2019 08:45
(Alliance News) - Real estate investment company SEGRO PLC said Wednesday that half-year profit narrowed, though rental income helped drive a revenue rise.
For the six months to June 30, the company's pretax profit was GBP410.8 million, down 28% from GBP570.9 million it recorded in the comparative period last year. This was as the the company saw lower property gains, totalling GBP247.6 million in the half versus GBP442.8 million a year ago.
On an adjusted basis, however, pretax profit rose 19% year-on-year to GBP131.8 million from GBP110.6 million, which the company attributed to record completions and rental growth.
Revenue for the period rose to GBP233.3 million from GBP167.2 million due to proceeds from sales of its trading properties and a 3.7% year-on-year rise in like-for-like net rental income.
SEGRO made GBP50.5 million from property sales and like-for-like net rental income for the period jumped to GBP146.0 million from GBP140.8 million.
Net rental income grew like-for-like in the UK by 4.3% to GBP102.8 million and by 2.5% in continental Europe to GBP45.9 million.
The company's EPRA net asset value per share rose 3.5% from the end of December to 673 pence from 650 pence.
SEGRO declared an interim dividend of 6.30 pence, a 134% year-on-year rise from 5.55p.
Chief Executive David Sleath said: "Momentum has continued throughout our business in the first half of 2019 and we are on track for another strong year. Our portfolio of high quality and well-located warehouse assets is performing well, as evidenced by strong rental growth and the low vacancy rate. Our development programme continues apace, capitalising on the ongoing, positive occupier demand across our markets"
"Looking ahead, we expect the development programme to generate further significant and profitable new rental income over coming years. This addition to the top-line, combined with the compounding effect of rental growth through our asset management of the existing portfolio, should enable us to drive both sustainable earnings and further dividend growth," Sleath added.
Shares in SEGRO were up 1.8% at 767.80 pence each in London on Wednesday morning.
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