23rd Jul 2019 09:20
(Alliance News) - Unite Group PLC on Tuesday reported further interim earnings growth, allowing an increase to dividend, in a "transformative" six months following the Liberty Living Holdings Inc deal.
Student accommodation firm Unite announced the Liberty Living deal, which includes 24,021 student beds, early in July, costing the firm GBP1.4 billion.
EPRA earnings for the six months to June climbed 16% to GBP61.2 million, but pretax profit did fall 12% to GBP125.5 million. The profit decline came mainly due to a rise in finance costs.
Unite is paying a dividend of 10.25 pence per share for the half-year, up 8% on the year before.
Net asset value per share on an EPRA basis at the end of June was 820 pence, 4% higher than the 790p at the end of December.
For the 2019/2020 academic year, Unite has reservations at a record 92%, from 91% a year ago, which supports rental growth of 3.0% to 3.5% for 2019/2020. Unite has a secured pipeline of 6,580 beds, and for the 2019/2020 year, it will have 51,200 operational beds in total worth GBP5.5 billion.
Chief Executive Richard Smith said: "The first half of 2019 has been a transformative period for Unite. Our proposed GBP1.4 billion acquisition of Liberty Living will create a portfolio with a gross asset value of GBP7 billion, comprising approximately 75,000 beds across the UK, with some 1.5 million students requiring accommodation each year."
"The Liberty Living business is complementary to our own, with a shared commitment to providing high-quality, affordable student accommodation and a portfolio strategically aligned with many high and mid-ranked Universities where student demand is strongest. The acquisition will utilise our best-in-class operating platform to accelerate and extend earnings and dividends growth," Smith continued.
"We have delivered further growth in our sustainable earnings during the first half, supporting an 8% increase in our interim dividend. Our growth remains underpinned by our high-quality portfolio in the best locations, deep and long-standing relationships with Universities, our operating platform and positive market dynamics."
Unite shares were 0.4% higher on Tuesday morning at a price of 1,048.00p each.
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