24th Jul 2018 08:13
LONDON (Alliance News) - Unite Group PLC said on Tuesday profit rose in the first of 2018, even as rooms reserved for the upcoming academic year remained flat from the year before.
The FTSE 250-listed student accommodation developer said pretax profit for the six months to the end of June rose by 70% to GBP142.5 million from GBP83.9 million a year before, as revenue climbed to GBP67.6 million from GBP62.7 million.
The profit rise was due to a rise in net valuation gains on property of GBP59.1 million, bettering the GBP28.3 million in such gains a year prior. In addition, net operating income rose to GBP78.5 million from GBP70.7 million, on the back of a 10% rise in rental income.
Unite Group said 91% of its rooms are reserved for the 2018-19 academic year, flat from this time the prior year, at pricing which "supports rental growth outlook" of 3.0% to 3.5%.
It noted that its development pipeline of 6,500 beds, could add 11-13 pence to earnings per share over the next few years.
Unite Group has increased its interim dividend to 9.5 pence per share, up 30% from 7.3p the year before.
"The first half of 2018 has been another active and successful period for Unite. We have delivered further increases in our sustainable and recurring earnings and maintained strong cash flows. The focus on our operating platform, property portfolio and University partnerships, supported by attractive market dynamics, continues to drive growth," said Chief Executive Richard Smith.
"We have expanded our University Partnership activity and further aligned our portfolio to the strongest Universities where student demand is at its highest. We are opening seven new properties over the summer and will be operating 52,000 beds for the 2018-19 academic year," Smith added.
Shares in Unite Group were down 0.7% at 834.50 pence on Tuesday.
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