16th Mar 2021 11:40
(Alliance News) - Unite Group PLC on Tuesday reported a widened pretax loss for 2020, as a loss on the revaluation of properties owned more than offset growth in revenue.
For the year, the Bristol-based student accommodation provider posted a pretax loss of GBP120.1 million, widened from GBP101.2 million the year before.
Although Unite did not incur any impairment charges on goodwill and intangible assets, it did incur a loss of GBP124.2 million on the valuation of property owned due to Covid-19, compared to a gain of GBP154.8 million the prior year.
Total revenue was 38% higher year-on-year at GBP215.6 million from GBP156.3 million, mostly through a rise in rental income driven by the acquisition of Liberty Living's 24,000 bed portfolio, despite cancellations for the summer term of the 2019-20 academic year.
As at December 31, Unite's net asset value per share declined 4% at 809 pence from 845p the same date in 2019. In addition, the group's total portfolio value fell 1.0% to GBP5.18 billion from GBP5.23 billion.
As a result, Unite posted a negative total accounting return of 3.4%, compared to a positive return 11.7%.
Unite reinstated its dividend payments, declaring a payout of 12.75 pence per share, up 24% from 10.25p the year before.
"While Covid-19 creates some uncertainty, the Higher Education sector's strong fundamentals, our high-quality portfolio and pipeline, the strength of our University relationships and our market-leading operating platform provide the foundations for a rapid recovery and significant future growth," the group said.
Looking ahead, Unite said its outlook remains strong, reflecting the underlying strength of student demand, and the group's relationships with the strongest universities. Looking at applications data and reservations for the 2021-22 academic year, Unite said it remains confident of a return to full occupancy and positive rental growth.
"The outlook for the business and the UK Higher Education sector is strong. A record share of school leavers are choosing to attend University, demographic growth is significant over the next decade and international student numbers continue to increase. We expect strong demand for the 2021/22 academic year, supporting a return to full occupancy and 2-3% rental growth. Together with our development and University partnership pipeline of 4,000 beds, this provides high visibility over a rapid recovery in earnings as market conditions stabilise," said Chief Executive Richard Smith.
Shares in Unite were up 3.1% at 1,029.00 pence on Tuesday in London.
By Dayo Laniyan; [email protected]
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