28th Aug 2014 07:46
LONDON (Alliance News) - Student accommodation provider Unite Group PLC Thursday said it will continue to grow its development pipeline as it reported an increase in profit and net asset value for the first half.
The company posted pretax profit of GBP44.6 million for the six months ended June 30, up from GBP37.5 million a year earlier, as total revenue rose to GBP57.9 million from GBP47.6 million.
Rental income, which along with property sales is incorporated into total revenue, increased to GBP45.0 million from GBP42.1 million a year earlier.
In turn, Unite said its EPRA net asset value per share rose to 402 pence from 382 pence at the end of December. EPRA earnings per share rose 17% to 10.9 pence from 9.3 pence a year earlier. EPRA is the European Public Real Estate Association, the industry body for European REITs.
On the back of this, the company increased its interim dividend 38% to 2.2 pence from 1.6 pence.
Unite said market conditions remained positive throughout the period. The group made good progress building its pipeline with four new developments with around 2,300 beds contractually secured in strong regional locations. Furthermore, planning consent was obtained for two London developments with around 1,600 beds, and two further schemes with 1,00 beds secured under lock-out agreements.
In addition, Unite UK Student Accommodation Fund acquired a high quality 3,000 bed regional portfolio and properties comprising around 1,900 bed spaces were sold into the open market, either by the group or its co-investment vehicles.
USAF is an open-ended non-listed real estate fund that focuses on acquiring and operating student accommodation in the UK. Unite owns 21% of USAF, is its investment manager, and operates its properties.
Unite said reservations for the 2014/15 academic year currently stand at 92% compared with 90% a year earlier.
The group said its capital structure was simplified and strengthened further in the period, partly due to retained profits and capital growth.
"Given the positive rental growth outlook, a growing development pipeline and USAF's recent acquisition of a high quality regional portfolio, we retain strong momentum and are now targeting a 4.5% earnings per share yield on net asset value for 2014, a year ahead of our previous plans," Chief Executive Mark Allan said in a statement.
Unite Group shares were down 0.1% at 440.00 pence Thursday morning.
By Anthony Tshibangu; [email protected]; @AnthonyAllNews
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