23rd Feb 2015 07:54
LONDON (Alliance News) - The Unite Group PLC Monday reported a higher profit and revenue for 2014, while declaring a significant increase in its dividend and giving a positive rental growth outlook.
The developer and manager of student accommodation, declared a final dividend of 9.0 pence per share, taking its total dividend for 2014 to 11.2 pence, up from only 4.8 pence in 2013, noting this was a payout ratio of 65%, well up from 35% last year.
"Our dividend now represents a 65% payout ratio and it should continue to grow significantly in the coming years," said Chief Executive Mark Allan in a statement.
Unite reported a pretax profit of GBP108.4 million for 2014, up from GBP77.1 million in 2013, as total revenue, which includes both rental income and property sales among other income, rose 6.8% to GBP108.5 million from GBP101.6 million. Like-for-like rental growth for the full year was 3.3%.
The property company said its EPRA net asset value per share stood at 434 pence, up almost 14% on last year, and equating to a total return on equity of 15%. EPRA is the European Public Real Estate Association, the industry body for European REITs.
EPRA earnings of GBP33.3 million, or 17.2 pence per share, was up 44% on a recurring basis, from GBP23.1 million of 13.6 pence per share in 2013.
Looking forward, the group highlighted a positive rental growth outlook with good earnings growth prospects.
"Market conditions remain supportive. Student numbers continue to grow steadily, interest rates are still low, development costs remain attractive and the investment market continues to strengthen," said Allan, adding, "We are alert to the risks of rising interest rates, development cost inflation and the uncertainty of an impending [UK] General Election but are managing the business in a disciplined way and continue to look forward with confidence."
Unite said rental growth and its secured development pipeline, although somewhat offset by disposals, could add 15 to 20 pence to EPRA earnings per share over the next four years.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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