24th Feb 2026 09:07
(Alliance News) - Unite Group PLC on Tuesday reported a decline in net assets in 2025 but lifted its dividend despite "weaker demand in a small number of cities".
The Bristol, England-based student accommodation provider said IFRS net assets per share declined 1.6% to 966 pence at the end of December from 982p a year prior.
EPRA net tangible assets per share fell 1.7% to 955p from 972p.
Pretax profit slumped 78% to GBP97.6 million from GBP444.0 million, as the firm reported GBP73.7 million valuation losses, compared to a GBP239.6 million gain in 2024.
Rental income improved 7.6% to GBP428.2 million from GBP398.0 million.
Shares in Unite Group fell 7.6% to 534.00 pence on Tuesday morning in London.
"Unite Students delivered a robust performance in 2025, with strong trading across the majority of our portfolio offset by weaker demand in a small number of cities for the 2025/26 academic year," said Chief Executive Joe Lister.
"Growing domestic demand for higher education, improving international mobility and constrained housing supply underpin the long-term prospects for the sector. Students continue to place high value on the residential university experience, supporting sustained demand for the high‑quality accommodation and living experience that we provide."
"While there is much to do, we are making early progress and building momentum. Delivering the benefits from our plan, together with the Empiric acquisition, provides a strong platform for 2027 and beyond."
In January, Unite completed the acquisition of Empiric Student Property PLC.
Back in June last year, Unite approached Empiric regarding a possible takeover before agreeing terms in August.
For each share held, Empiric stockholders received 0.085 of a new Unite share, plus 32 pence in cash, including dividends.
At the time, with the Unite share price at 732 pence per share, the bid valued each Empiric share at 94.2p or GBP634 million.
On Tuesday, Unite maintained its final dividend at 24.9p per share, taking the annual payout to 37.7p, up 1.1% from 37.3p.
It added: "The company intends to maintain a stable dividend payout in 2026, distributing 37.7p for the financial year, balancing confidence in the medium-term outlook with the expected reduction in adjusted earnings per share for the year ahead."
Unite reported 4.0% rental growth and 95.2% occupancy for the 2025/26 academic year, compared to 8.2% and 97.5% for 2024/25.
Looking ahead, Unite said it sees 2026 adjusted earnings per share between 41.5p and 43.0p, down from 47.5p in 2025, which had represented 1.9% growth from 46.6p in 2024.
Unite said this reflects that Empiric's 2025/26 income is below expectations ahead of integration to its platform.
Unite also expects 2026/27 income at the lower end of the range for between 2% and 3% rental growth and 93% to 96% occupancy.
In addition, Unite Group noted Unite Students has agreed the sale of St Pancras Way, a 571-bed property in London, to the Unite UK Student Accommodation Fund for GBP186 million. Unite Group's share is GBP126 million.
It said the transaction will be funded by existing cash headroom in USAF and the issue of new USAF units, which will be fully underwritten by Unite.
Subject to existing USAF investors choosing to exercise their pre-emption rights, the USAF equity issue will increase Unite's ownership in USAF to a maximum of 32% from 30%. Unite expects to receive minimum net proceeds of GBP115 million in cash.
Unite added that it plans to maintain its ownership in USAF at around 30% over the medium-term.
St Pancras Way was developed by Unite in 2014 and is fully nominated to University College London for the 2026/27 academic year.
The disposal represents a 1% discount to the book value in December and reflects a net operating income yield of 4.7%.
"The sale to USAF means we remain invested in a high-quality London asset, while enhancing management fee income and releasing capital for reinvestment into higher-returning opportunities in accordance with our capital allocation priorities," CEO Joe Lister said.
Separately, Unite Group said it has appointed Duncan Cooper as a non-executive director and chair of the audit & risk committee.
Cooper is currently chief financial officer of Northampton, England-based building materials firm Travis Perkins PLC and was previously group finance director at Surrey, England-based housebuilder Crest Nicholson Holdings PLC.
By Michael Hennessey, Alliance News reporter
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