Preliminary Full Year Financial Results

20 November 2025

Grainger plc

Preliminary full year financial results

for the twelve months ended 30 September 2025

 Continuing to deliver excellent earnings growth

§ Net Rental Income up +12%

§ Pre tax EPRA Earnings +12%

§ Dividend per share up +10%

§ High occupancy at 98.1%

§ FY29 guidance reiterated:

£72m EPRA earnings (9.7pps),

8%+ TAR, c.30% LTV

Grainger plc, the UK's largest residential REIT and leader in the build-to-rent (BTR) sector, today announces an excellent performance for the 12 months ended 30 September 2025.

Helen Gordon, Chief Executive, said:

"It is my pleasure to once again report that we have delivered an excellent performance and another year of strong earnings growth.

"Our focus on delivering great homes and great service to our customers and excellent risk-adjusted returns for shareholders has meant we have delivered an increase in earnings of +12%, an increase in net rental income of +12% and a +10% increase in dividend, our 20th consecutive period of increasing our dividend, which has seen us distribute c.£345m to shareholders over the past 10 years. In the last 7 years we have delivered like-for-like rental growth on average of 4.1% per annum. Customer affordability remains resilient and customer satisfaction levels remain sector-beating and put us on par with leading global consumer brands.

"Pre tax EPRA earnings will continue to grow. We continue to target £60m (8.1p per share) by FY26 and £72m (9.7pps) by FY29 in line with guidance, even after assuming we absorb higher interest rates over this period. This growth will come from the delivery of our £343m Committed Pipeline of which only c.£130m of capital expenditure is remaining.

"This year, after the successful transformation of Grainger into the UK's leading listed build-to-rent business, we converted to a Real Estate Investment Trust (REIT), which will enhance shareholder returns and supports our enduring strategy.

"We have certainty and clarity over the regulatory landscape for our market with the Renters' Rights Act, which aligns to our business model and rejects any form of rent control.

"Our asset class is characterised by strong fundamentals and is low-risk. Both residential rents and capital values have outperformed commercial real estate for the past twenty years. Residential rents, on average, outperform inflation. The net asset value of our portfolio has proven resilient again this period, backed up by disposals, and over the past five years despite increased interest rates the net asset value of our portfolio has increased +5.0%.

"We have a clear focus on delivering returns for shareholders. Our approach to capital allocation prioritises the delivery of our Committed Pipeline and delivery of our earnings growth guidance to FY29, whilst also focusing on driving cost efficiencies and deleveraging by between c.£300m-350m with a Net Debt to EBITDA target of c.8x and LTV of c.30%. We believe this is eminently deliverable when considering we generate c.£200m+ of cashflow each year from operating activities and sales proceeds.

"We are committed to continuing to deliver progressive dividend growth for years ahead.

"It has been another excellent performance for Grainger and the outlook for the business is bright as we continue to deliver sector-leading earnings growth despite macro-economic headwinds."

Highlights

§ +12% growth delivered in Net Rental Income1 to £123.6m (FY24: £110.1m)

§ +12% increase in EPRA Earnings to £53.7m (FY24: £48.0m) and in EPRA EPS to 7.3pps (FY24: 6.5pps)

§ Dividend increased +10% to 8.31p per share (FY24: 7.55p per share)

§ IFRS Profit before tax up to £102.6m

§ Strong occupancy of 98.1% in our BTR portfolio (FY24: 97.4%)

§ EBITDA margin expansion continues to 55.5% (FY24: 54.0%)

§ +3.6% like-for-like rental growth3 in our portfolio (Mar-25: 4.4%)

o  +3.4% like-for-like rental growth in our BTR Portfolio

§ +1.8% on new lets (Mar-25: 3.1%)

§ +4.5% on renewals (Mar-25: 4.9%)

o  +6.6% like-for-like rental growth in our Regulated Tenancy Portfolio (Mar-25: 7.0%)

§ Capital recycling: Strong sales performance of £169m, recycling capital from lower-yielding assets in line with valuations into BTR 

§ Net asset value (EPRA NTA) resilient at 298pps (FY24: 298pps), with overall portfolio valuation up 0.7%

§ Strong balance sheet and funding position, debt costs fixed in mid 3%s to FY29 with plans in place to deleverage between c.£300m-£350m by FY29, targeting Net Debt to EBITDA of c.8x and LTV of c.30%

§ Customer affordability remains robust at 28% of gross household income (FY24: 28%)

§ Customer satisfaction remains high, with our Customer Net Promoter Score placing Grainger in line with leading global consumer brands

§ Rental growth for FY26 expected to be in line with the long-term historical average of 3-3.5%

1 Refer to Note 5 for net rental income calculation.

2 Refer to Note 2 for profit before tax and adjusted earnings reconciliation.

3 Rental growth is the average increase in rent charged across our portfolio on a like-for-like basis.

4 EPRA Earnings is a measure of recurring earnings from core operational activities which the Company uses in accordance with the Best Practices Recommendations of the European Public Real Estate Association (EPRA). For more details please see page 180-183 of the Annual Report and Accounts

5 £123.6m tax credit (17p) arising from REIT conversion. This does not impact the Net Tangible Asset (NTA) metric.

6 Dividends - Subject to approval at the AGM, the final dividend of 5.46p per share (gross) amounting to £40.4m will be paid on 20 February 2026 to Shareholders on the register at the close of business on the record date, 16 January 2026 (the shares will go ex-dividend on 15 January 2026). Shareholders will again be offered the option to participate in a dividend reinvestment plan and the last day for election is 30 January 2026. An interim dividend of 2.85p per share amounting to a total of £21.1m was paid to Shareholders on 7 July 2025. - refer also to Note 11.

Results presentation

Grainger will be holding a presentation of the results at 08.30am (UK time) today, 20 November 2025, which can be accessed via webcast and a telephone dial-in facility (details below), which will be followed by a live Q&A session for sell side analysts and shareholders.

Webcast details:

To view the webcast, please go to the following URL link. Registration is required.

https://brrmedia.news/GRI_FY_25  

The webcast will be available for six months from the date of the presentation.

Conference call details:

Call: +44 (0)330 551 0200

Confirmation Code: Quote Grainger FY25 when prompted by the operator

A copy of the presentation slides will also be available to download on Grainger's website (http://corporate.graingerplc.co.uk/) from 08:30am (UK time).

Annual Report & Accounts

We are today also publishing our 2025 Annual Report & Accounts on our website, including the ESEF (tagged) version, (https://corporate.graingerplc.co.uk/investors/investor-downloads) and we will also be submitting both versions to the National Storage Mechanism and they will shortly be available for inspection at: data.fca.org.uk/#/nsm/nationalstoragemechanism.

We will be publishing our Notice of Annual General Meeting in December 2025, and we will also submit this to the National Storage Mechanism to make it available for inspection. A further announcement will be made at this time.

For further information, please contact:

Investor relations

Kurt Mueller, Grainger plc: +44 (0) 20 7940 9500

Media

Ginny Pulbrook / Geoffrey Pelham-Lane, Camarco: +44 (0) 20 3757 4992 / 4985

Forward-looking statements disclaimer

This announcement may contain certain statements that are forward-looking statements. They appear in a number of places throughout this announcement and include statements regarding Grainger plc's intentions, beliefs or current expectations and those of our officers, directors and employees concerning, amongst other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the business we operate. By their nature, these statements involve risks and uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this announcement and, unless otherwise required by applicable law, Grainger plc undertakes no obligation to update or revise these forward-looking statements. Nothing in this announcement should be construed as a profit forecast. Grainger plc and its Directors accept no liability to third parties in respect of this announcement save as would arise under English law.

Information about the management of the Principal Risks and Uncertainties facing Grainger plc is set out within the Annual Report and Accounts 2025. Any forward-looking statements in this announcement speak only at the date of this announcement and Grainger plc undertakes no obligation to update publicly or review any forward-looking statement to reflect new information or events, circumstances or developments after the date of this announcement.

Nature of announcement

This announcement is for information purposes only and no reliance may be placed upon it. No representative or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained in this announcement. Past performance of securities in Grainger plc cannot be relied upon as a guide to the future performance of such securities. This announcement does not constitute an offer for sale or subscription of, or solicitation of any offer to buy or subscribe for, any securities of Grainger plc. 

Chief Executive's Statement

Continuing to deliver excellent earnings growth

Once again I am pleased to say your company has delivered another excellent performance with strong income growth, evidencing our resilience despite macroeconomic headwinds.

These challenging macro factors, including enduring high interest rates, are undoubtedly putting downward pressure on the listed real estate sector generally. However we are focused on what is in our control, such as growing income, managing costs, and enhancing our portfolio of high quality homes.

Portfolio expansion and strong operational performance delivered another year of strong earnings growth, with pre tax EPRA earnings up +12%. IFRS profit before tax was £102.6m (FY24: £40.6m) as a result of positive valuation movements.

Grainger operates in the UK housing rental market which continues to see a worsening supply shortage coupled with strong demand. Our sector-leading operational platform enables us to outperform and we delivered exceptional occupancy in the year of 98.1% alongside robust like-for-like rental growth of 3.6%, broadly in line with the long run average.

Our customer affordability level remains robust at 28% and customer satisfaction levels remain sector-beating with scores alongside global consumer brands.

Our capital structure is in a strong position with our average cost of debt at 3.3% and remaining low until FY29, with plans in place to reduce debt in the medium-term.

We will continue to recycle out of our low-yielding, non-core assets (primarily regulated tenancies) which will fund the remaining spend in our Committed Pipeline and enable us to reduce net debt by between c.£300m-£350m by FY29 to support ongoing earnings growth.

Grainger is therefore well positioned to continue to grow and deliver shareholder value. Our £343m Committed Pipeline, with only c.£130m remaining to spend, will grow earnings significantly. We continue to target £60m earnings (pre tax EPRA basis) by FY26 and £72m by FY29 in line with prior guidance.

In addition, we have a significant pipeline of future opportunities which provides us optionality to accelerate growth in the future.

Strategic transformation culminating in REIT conversion

It is almost 10 years since I set out our build-to-rent (BTR) strategy and our ambition to deliver for Shareholders a company with resilient earnings in an undersupplied market. We laid out a path toward transforming Grainger into a focused, simplified residential rental investment business and over the past 10 years we have delivered:

1. +14% 10yr CAGR in Net Rental Income

2. Significantly increased EPRA earnings to £54m

3. Increased EBITDA margins by nearly 3 times from 19% to 56%

4. Increased dividend per share by +202%, 20 consecutive periods of growth, distributing c.£345m to Shareholders over the 10 year period

5. Improved customer satisfaction by 2.75 times or +66pts since we first measured NPS in 2017

We have disposed of £1.9bn of non-core assets over the 10 year period and have invested to create from scratch our BTR portfolio which now stands at £2.9bn and 11,078 homes, serving more than 25,000 customers.

This major transformation focusing on growing recurring rental income has enabled us to convert to a Real Estate Investment Trust (REIT) this year, which requires at least 75% of assets and profits to come from rental investments.

REIT status will enhance shareholder returns and importantly will not impede our growth trajectory. Our business model and strategy remains unchanged.

Grainger has a compelling investment case:

1. Low risk asset class with resilient growth

2. Strong market fundamentals

3. Strong customer base with positive outlook for rental growth

4. Certain and supportive regulatory outlook

5. Sector leading portfolio and operational platform underpinned by data insight.

Residential rental: Low risk asset class with excellent growth prospects

Residential rental has some of the most defensive characteristics of any real estate asset class. Both residential rents and capital values have outperformed commercial real estate for the past twenty years. Residential rents, on average, outperform inflation. The net asset value of our portfolio has proven resilient again this period, backed up by sales. Over the past five years despite increased interest rates the net asset value of our portfolio has increased +5.0%.

Strong market fundamentals

A worsening supply shortage with a current deficit of 4.3m homes nationally contrasts starkly with a growing population of renters. Only 2.5% of the rental market is BTR with the remainder mainly made up of small, private landlords who continue to exit the sector. At the same time, demand for renting continues to grow with Savills forecasting 20% growth in demand for the 10 years to 2031

Strong customer base

Our customer base is diverse and robust. Customer affordability remains stable and healthy at 28%, and our customers are employed across a broad range of sectors and job types.

A certain and supportive regulatory outlook

There is a strong political and societal push toward greater professionalisation. In October this year the Government passed the Renters' Rights Bill. We now have certainty over the regulatory outlook for our market and we have confirmation that this Government fundamentally opposes any form of rent controls. We are well positioned to thrive in this new legislative environment.

All these factors provide a strong foundation for Grainger's continued future success.

A market-beating strategy with a sector leading portfolio and operational platform underpinned by data insight

Grainger's BTR strategy is to invest in and provide mid-market rental homes in locations with the greatest demand and shortest supply. We own and manage all our properties directly. We are responsible for the customer relationship and this overall approach allows us to outperform. It allows us to fully understand our customers, their preferences and drivers and respond accordingly. Our technology platform, CONNECT, enables us to manage a large portfolio efficiently and effectively.

Our sector-leading operational platform is focused on delivering great service to customers and great value for Shareholders. 

Delivering outperformance

Our strategy has proven that it delivers. We continue to achieve high occupancy and responsibly drive rental growth year-on-year.

This in turn delivers shareholder returns. EPRA Earnings were up +12% this year, after a 24% increase last year. And this growth will continue. From the delivery of our Committed Pipeline, after assuming a full rebasing of our debt costs to a higher rate, we expect to grow EPRA earnings significantly to £72m by FY29.

The portfolio continues to demonstrate its resilience with valuations stable and EPRA NTA resilient at 298p per share. The value of our portfolio (EPRA NTA) is up +5.0% over the past five years despite the high interest rate environment. This is amongst the highest in the real estate sector, evidencing our resilience. And our accelerated disposals programme reaffirms the value of our portfolio with a high volume of varying asset types being sold in line with valuations. Over the last three years, we have sold £640m of non-core assets.

Due to the strength of Grainger's ongoing performance, we are proposing a final dividend of 5.46p per share, which brings our total dividend for the year to 8.31p, a +10% increase.

A leading approach to the workplace, communities and environment

We are committed to being a great place to work. Our recognition by the National Equality Standard reaffirms this commitment.

Equally, our colleagues confirm that Grainger is a great place to work. This year we achieved our highest ever employee engagement score, securing two out of three stars for being an 'Outstanding' workplace by the independent assessor Best Companies, and placing in the Top 50 best places to work in the Large Company category.

Our high performance and inclusive culture is central to Grainger's continued success and strength.

Over the year, we partnered with over 30 local charities, giving both colleagues and customers the opportunity to give something back to their local communities. Much of our charitable efforts focus on housing and homelessness, aligned to our business. One standout initiative is our partnership with the youth homelessness charity, LandAid, and our involvement in their BTR Pathfinder programme, which sees us pledging accommodation to support young people at risk of homelessness. To date, we have supported three young people to give them a home in our communities from which to start living independently.

We have for many years also taken a sector leading approach to sustainability. I am pleased to report that this year our emissions reduction targets have been validated by the globally recognised Science Based Targets initiative (SBTi) and align to the 1.5 degree climate commitment by the UK Government and the Paris Agreement. Because of our strong sustainability credentials, we have now been added to the Dow Jones Best-in-Class Indices for Europe for 2025, supplementing our high ratings in a number of other benchmarks. And I am pleased to report that 96% of our BTR portfolio now has EPC certificates of between A to C, providing our customers energy efficient homes.

An excellent, positive outlook

As I first mentioned, what we have in our control is in excellent shape and we intend to ensure this remains the case.

A focus on capital allocation and delivering shareholder value

With current expectations of high interest rates remaining, we are focusing our attention on the imminent delivery of our Committed Pipeline and delivering our guided EPRA earnings target of £72m by FY29. Our other priority is to reduce net debt in order to mitigate against the impact of higher interest rates. These initiatives are both deliverable because of our successful ongoing disposals programme.

We are equally focusing our attention on costs, particularly central overheads. Our platform has been designed for growth and scale, and as the pace of our acquisitions naturally settles to align to the prevailing market conditions, it is important we manage costs appropriately in the interim. We therefore have plans in place to ensure central costs are as efficient as possible and sized appropriately for the scale and nature of our portfolio.

With this front footed approach, we will maintain the strength of our market positioning to enable us to accelerate growth swiftly in the future.

I would like to thank the Board of Grainger and particularly our Chair of the last nine years, Mark Clare, for his unwavering support of our strategy and for his guidance and insights he has given me and the senior leadership team of Grainger. His support has been invaluable. I would also like to thank Justin Read, our Senior Independent Director, for leading the search for our Chair Designate, Simon Fraser. I look forward to working with Simon.

Finally, I would like to thank my colleagues, an exceptional team who have once again delivered for you.

Helen Gordon

Chief Executive Officer

19 November 2025

Financial review

FY25 saw another strong year of growth in net rental income and earnings, with good visibility of further growth to come. Strong occupational markets with occupancy at 98.1% and like-for-like rental growth of 3.6% combined with our pipeline deliveries saw total net rents grow by 12%. This resulted in strong earnings growth with pre tax EPRA earnings up 12%, as we continue to target £60m for the coming year and £72m by FY29.

It was also another good year for sales with £169m of sales delivered during the year, demonstrating both the value and liquidity of our asset base. Despite the challenging macroeconomic backdrop valuations were marginally up in the year as we saw ERV growth of 3.2% offsetting a small outward yield shift.

Our balance sheet remains in a healthy position with strong liquidity and a good hedging profile. Both net debt and LTV are broadly in line with the prior year. With only c.£130m of committed capex left to spend we will start using our significant operating cash flows to lower leverage by c.£300m-£350m from FY27 onwards.

Our dividend per share continues its strong growth trajectory, increasing by 10.1% to 8.31p on a per share basis (FY24: 7.55p).

We also successfully converted to a REIT in September 2025 marking a significant milestone in Grainger's transformation. Converting to REIT status positions Grainger as a more tax‑efficient investment vehicle, eliminating effective double taxation for the business and its Shareholders. The move unlocks meaningful Shareholder value through improved returns, strengthens the company's ability to continue to grow its dividend, and allows the business to continue to enhance its operational platform. In the year we have recognised a tax credit of £123.6m as a result of the conversion.

Financial highlights

1. £123.6m tax credit (17p) arising from REIT conversion. This does not impact the Net Tangible Asset (NTA) metric.

Income statement 

The business continues to deliver very strong growth in EPRA earnings, up 12% to £53.7m (FY24: £48.0m) This was driven by continued strong growth in net rents of 12% combined with a strong focus on cost efficiency.

Adjusted earnings were broadly flat at £91.0m (FY24: £91.6m) as the sales profits from our reducing regulated tenancy business are replaced with rental income from our pipeline. The lower sales profits were in line with the smaller size of the regs portfolio.

IFRS profit before tax was £102.6m (FY24: £40.6m) as a result of positive valuation movements.

1 Including LADs: "liquidated and ascertained damages" of £3.6m (2024: £5.2m)which provide financial compensation for the loss of rental income caused by delays to the practical completion of our schemes

2 EPRA Earnings is a measure of recurring earnings from core operational activities. For more details please see page 35

3 Adjusted earnings per share includes tax of £22.2m (FY24: £22.9m) at the Group's adjusted tax rate of 24.4%(FY24: 25%), adjusted for the effect of REIT conversion (FY24: 25%).

4 Including £(59)m in H1 FY24 due to the removal of MDR; excluding this, underlying valuation movement was +£20m in FY24.

5  £123.6m tax credit (17p) arising from REIT conversion. This does not impact the Net Tangible Asset (NTA) metric.

Rental income 

Net rental income increased by 12% to £123.6m (FY24: £110.1m), as we saw continued strength in occupational markets. The strong £13.5m increase was driven by a combination of strong delivery of pipeline scheme launches which contributed £17.7m along with another year of rental growth reflecting strong demand for our product.

Overall like-for-like rental growth was in line with our long run average at +3.6% (FY24: +6.3%) with the BTR portfolio continuing to deliver at +3.4% (FY24: +6.3%), with rental growth on renewals of +4.5% (FY24: +6.8%) and +1.8% (FY24: +5.6%) on new lets. While our new lets rental growth remained strong, the lower levels compared to FY24 were due to our focus on maximising our occupancy levels. Our regulated tenancy portfolio also delivered strong rental growth at +6.6% (FY24: +6.6%). Looking forward we maintain our guidance on rental growth in the coming year to continue in line with the long-run average rate of 3.0% - 3.5%, with occupational markets back to normalised levels we expect to see some seasonality in rental growth return with H2 stronger than H1 growth.

Gross to net for our stabilised portfolio improved to 25.0% (FY24: 25.0%) as we continue our strong focus on cost efficiencies.

Sales

FY25 was another good year for sales as we continue our non-core asset recycling strategy in order to fund the required capital expenditure on our committed pipeline and the plan to lower leverage. Overall sales revenue was £168.9m, (FY24: £274.3m) with £82.4m of sales revenue coming from BTR recycling and £86.4m from regs sales. The continued delivery of sales saw pricing in line with book values, justifying current valuations.

Sales profits were lower at £37.3m (FY24: £43.6m) as expected reflecting a smaller regulated tenancy portfolio from which sales profits are generated. Profits from BTR recycling are based on valuation and therefore profit margins are much lower.

Vacant property sales profits in the period were down (27)%, as expected, delivering £18.5m (FY24: £25.4m), Vacancy rates were slightly lower at 6.0% (FY24: 7.1%) with margins slightly down on prior year due to the tenancy mix. Pricing achieved remained robust with sales values within 0.4% of vacant possession values.

Sales of tenanted and other properties delivered £18.7m of profit (FY24: £15.6m) from £121.2m of revenue (FY24: £194.0m).

Overheads

Overheads increased by 4% in the period to £36.7m (FY24: £35.3m) as a result of wage growth across our employee base. Looking forward we see the opportunity to remove £2m of costs from overheads of which we expect to deliver £1m of these savings in the coming year. This will ensure that overheads will not increase in the next 2 years.

Balance sheet 

Our BTR portfolio now represents 84% of our operational portfolio given the success of both our pipeline delivery and regulated tenancy recycling.

LTV was broadly flat on the prior year at 38.4% (FY24: 38.2%) reflecting investment. Looking forward, we plan to lower net debt by c.£300m-£350m by FY29 in order to mitigate the impact of rising finance costs as our low rate hedging rolls off. This will be funded by our strong operating cash flows.

EPRA NTA was flat at 298p per share (FY24: 298p per share) reflecting the resilience of our asset class against a backdrop of macroeconomic uncertainty. 

Property portfolio performance 

Over the year our portfolio valuation was up overall by 0.7%. Our BTR portfolio grew 1.1% over the year which saw strong ERV growth of 3.2% which was partly offset by a small outward yield movement in the period. Valuations in the regulated portfolio were largely flat in the year.

Financing and capital structure 

Net debt was broadly flat during the year at £1,463m (FY24: £1,453m), however it was down from the half year position of £1,475m. The significant investment in our pipeline of £133m was offset by our continued asset recycling strategy generating £174m of net sales proceeds. With only c.£130m left to spend on our committed pipeline, we will start to use operational cash flows to lower net debt from FY27.

We have minimal refinancing risk with an average debt maturity of 3.9 years including extension options. We continue to benefit from a very strong hedging profile, which is in place until FY29 and with our average cost of debt remaining relatively flat at 3.3% (FY24: 3.2%). Looking forward we plan to lower our net debt by £300m-£350m over the next 4 years, which would equate to an LTV of c.30% and c.8x net debt to EBITDA which we see as the appropriate capital structure in this current interest rate environment.

Summary and outlook 

FY25 was yet another year of strong growth in net rents and earnings as we continue to deliver compounding growth. As we start our next phase of growth as a REIT, we are confident of the outlook and retain our prior guidance of targeting pre tax EPRA earnings of £60m for FY26 and £72m by FY29, a period over which we will absorb the substantial headwind of higher interest rates. This continued growth despite the macroeconomic headwinds is a testament to the resilience of our asset class and the excellence of our operating platform.

Rob Hudson 

Chief Financial Officer 

19 November 2025

Consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of financial position

Consolidated statement of changes in equity

Consolidated statement of cash flows

Notes to the preliminary financial results

1. Accounting policies

1a Basis of preparation

The Board approved this preliminary announcement on 19 November 2025. The financial information included in this preliminary announcement does not constitute the Group's statutory accounts for the years ended 30 September 2024 or 30 September 2025. Statutory accounts for the year ended 30 September 2024 have been delivered to the Registrar of Companies. The statutory accounts for the year ended 30 September 2025 will be delivered to the Registrar of Companies following the Company's annual general meeting.

The auditors, KPMG LLP, have reported on the accounts for both years. The reports were unqualified, did not include reference to any matters by way of emphasis and did not contain statements under section 498 (2) or (3) of the Companies Act 2006.

These financial statements for the year ended 30 September 2025 have been prepared under the historical cost convention except for the following assets and liabilities, and corresponding income statement accounts, which are stated at their fair value; investment property; derivative financial instruments; and financial interest in property assets.

The accounting policies used are consistent with those contained in the Group's full annual report and accounts for the year ended 30 September 2025. The financial information included in this preliminary announcement has been prepared in accordance with UK-adopted international accounting standards (IFRS) and applicable law. The Group elected to adopt REIT status from 8 September 2025. As a consequence of the Group's REIT status, UK corporation tax is not levied on the Group's qualifying property rental business profits, or gains from the sale of qualifying investment properties.

1b Adoption of new and revised International Financial Reporting Standards and interpretations

The following new standards and amendments to standards were issued and adopted in the year and have no material impact on the financial statements:

• Amendments to IAS 1 - Classification of liabilities as current or non-current;

• Amendments to IAS 1 - Non-current Liabilities with Covenants;

• Amendments to IAS 7 and IFRS 7 - Disclosures: Supplier finance arrangements;

• Amendments to IFRS 16 - Lease liability in a sale and leaseback.

The following new standards and amendments to standards have been issued but are not yet effective for the Group and have not been early adopted:

• Amendments to IAS 21 - Lack of exchangeability;

• Amendments to IFRS 9 and IFRS 7 - Amendments to the Classification and Measurement of Financial Instruments;

• Annual Improvements to IFRS Accounting Standards - Volume 11;

• Amendments to IFRS 9 and IFRS 7 - Contracts Referencing Nature-dependent Electricity;

• IFRS 18 - Presentation and Disclosure in Financial Statements;

• IFRS 19 - Subsidiaries without Public Accountability: Disclosures;

• Amendments to IFRS 10 Consolidated Financial Statements;

• Amendments to IAS 28 Investments in Associates and Joint Ventures.

With the exception of IFRS 18, which the Group is still assessing and the impact to the financial statements is not yet known, the application of these new standards and amendments are not expected to have a material impact on the Group's financial statements.

1c Significant judgements and estimates

Estimates

i. Valuation of property assets

Residential trading property is carried in the statement of financial position at the lower of cost and net realisable value and investment property is carried at fair value. The Group does, however, in its principal non-GAAP net asset value measures, EPRA NRV, EPRA NTA and EPRA NDV, include trading property at market value.

The adjustment in the value of trading property is the difference between the statutory book value and its market value as set out in Note 3. For investment property, market value is the same as fair value. In respect of trading properties, market valuation is the key assumption in determining the net realisable value of those properties.

Notes to the preliminary financial results continued

In all cases, forming these valuations inherently includes elements of judgement and subjectivity with regards to the selection of unobservable inputs. The valuation basis and key unobservable inputs are outlined in Note 2 in the 2025 Annual Report and Accounts.

The results and the basis of each valuation and their impact on both the financial statements and market value for the Group's non-GAAP net asset value measures are set out below:

1 Includes investment property - held for sale

2 Allsop LLP provide vacant possession values used by the Directors to value the financial asset.

3 The market value adjustment is the difference between the statutory book value and the market value of the Group's properties. Refer to Note 3 for market value net asset measures.

4  Includes the Group's share of joint ventures and associates revaluation loss after tax.

Judgements

i. Distinction between investment and trading property

The Group considers the intention at the outset when each property is acquired in order to classify the property as either an investment or a trading property. Where the intention is either to trade the property or where the property is held for immediate sale upon receiving vacant possession within the ordinary course of business, the property is classified as trading property. Where the intention is to hold the property for its long-term rental yield and/or capital appreciation, the property is classified as an investment property. The classification of the Group's properties is a significant judgement which directly impacts the statutory net asset position, as trading properties are held at the lower of cost and net realisable value, whilst investment properties are held at fair value, with gains or losses taken through the consolidated income statement.

Notes to the preliminary financial results continued

The Group continually reviews properties for changes in use that could subsequently change the classification of properties. A change of use occurs if property meets, or ceases to meet, the definition of investment property which is more than a change in management's intentions. The fact patterns associated with changes in the way in which properties are utilised are considered on a case by case basis and to the extent that a change in use is established, property reclassifications are reflected appropriately.

1d Group risk factors

The principal risks and uncertainties facing the Group are set out in the Risk Management report of the 2025 Annual Report and Accounts. A number of risks faced by the Group are not directly within our control such as the wider economic and political environment.

1e Going concern assessment

The Directors are required to make an assessment of the Group's ability to continue to trade as a going concern for the foreseeable future. Given the macro-economic conditions in which the Group is operating, the Directors have placed a particular focus on the appropriateness of adopting the going concern basis in preparing the financial statements for the year ended 30 September 2025.

The financial position of the Group, including details of its financing and capital structure, is set out in the financial review on pages 31 to 36 in the 2025 Annual Report and Accounts. In making the going concern assessment, the Directors have considered the Group's principal risks (see pages 59 to 63 in the 2025 Annual Report and Accounts) and their impact on financial performance. The Directors have assessed the future funding commitments of the Group and compared these to the level of committed loan facilities and cash resources over the medium term. In making this assessment, consideration has been given to compliance with borrowing covenants along with the uncertainty inherent in future financial forecasts and, where applicable, severe but plausible sensitivities have been applied to the key factors affecting financial performance for the Group.

The going concern assessment covers as least a year from the date of approval of the financial statements. It uses the same forecasts considered by the Group for the purposes of the Viability Statement. The assessment considers a severe but plausible downside scenario, reflecting the following key assumptions:

· Reducing PRS occupancy to 90%

· Rental growth reduced by 100bps to 2.0%

· Reducing property valuations by 10%, driven by rents yield expansion or house price deflation

· Operating and development cost inflation of 10% p.a.

· An increase in SONIA of 2%

The Group's forecasts incorporate the likely impact of climate change and sustainability requirements including costs to deliver our climate related targets. This includes EPC upgrades across the portfolio and investing in energy efficient solutions for central heating systems.

No new financing is assumed in the assessment period, but existing facilities are assumed to remain available. Even in this severe but plausible downside scenario, the Group has sufficient cash reserves, with the loan-to-value covenant remaining no higher than 46% (facility maximum covenant ranges between 70% - 75%) and interest cover no lower than 2.69x (facility minimum covenant ranges between 1.35x - 1.75x) for the period.

Based on these considerations, together with available market information and the Directors' experience of the Group's property portfolio and markets, the Directors continue to adopt the going concern basis in preparing the accounts for the year ended 30 September 2025.

1f Forward-looking statement

Certain statements in this preliminary announcement are forward-looking. Although the Group believes that the expectations reflected in these forward-looking statements are reasonable, we can give no assurance that these expectations will prove to have been correct. Because these statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. We undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. See page 5 for the full forward-looking statements disclaimer.

Notes to the preliminary financial results continued

2. Analysis of profit before tax

The table below details adjusted earnings, which is one of Grainger's key performance indicators. The metric is utilised as a key measure to aid understanding of the performance of the continuing business and excludes valuation movements and other adjustments, which do not form part of the normal ongoing revenue or costs of the business and, either individually or in aggregate, are material to the reported Group results.

Profit before tax in the adjusted columns above of £91.0m (2024: £91.6m) is the adjusted earnings of the Group. Adjusted earnings per share assumes tax of £22.2m (2024: £22.9m) in line with the Group's current year tax rate of 24.4%, adjusted for the effect of REIT conversion on 8 September 2025 (2024: 25.0%), divided by the weighted average number of shares as shown in Note 10. The Group's IFRS statutory earnings per share is also detailed in Note 10. The classification of amounts as other adjustments is a judgement made by management and is a matter referred to the Audit Committee for approval. Included in other adjustments are £1.9m of fire safety provisions (2024: £5.0m), REIT conversion costs of £0.6m (2024: £nil), aborted acquisition costs of £0.8m (2024: £nil), and hedge ineffectiveness under IFRS 9 of £8.5m (2024: £6.6m).

Notes to the preliminary financial results continued

3. Segmental information

IFRS 8, Operating Segments requires operating segments to be identified based upon the Group's internal reporting to the Chief Operating Decision Maker ('CODM') so that the CODM can make decisions about resources to be allocated to segments and assess their performance. The Group's CODM are the Executive Directors.

The two significant segments for the Group are PRS and Reversionary. The PRS segment includes stabilised PRS assets as well as PRS under construction through direct development and forward funding arrangements, both for wholly-owned assets and the Group's interest in joint ventures and associates as relevant. The Reversionary segment includes regulated tenancies, as well as CHARM. The Other segment includes legacy strategic land and development arrangements, along with administrative expenses.

The key operating performance measure of profit or loss used by the CODM is adjusted earnings before tax, valuation and other adjustments.

The principal net asset value (NAV) measure reviewed by the CODM is EPRA NTA which is considered to be the most relevant, and therefore the primary NAV measure for the Group. EPRA NTA reflects the tax that will crystallise in relation to the trading portfolio, whilst excluding the volatility of mark to market movements on fixed rate debt and derivatives which are unlikely to be realised. Other NAV measures include EPRA NRV and EPRA NDV which we report alongside EPRA NTA.

Information relating to the Group's operating segments is set out in the tables below. The tables distinguish between adjusted earnings, valuation movements and other adjustments and should be read in conjunction with Note 2.

2025 Income statement

A reconciliation from adjusted earnings to EPRA earnings is detailed in the table below, with further details shown in the EPRA performance measures section at the end of this document:

Notes to the preliminary financial results continued

2024 Income statement

A reconciliation from adjusted earnings to adjusted EPRA earnings is detailed in the table below:

Segmental assets

The net asset value measures reviewed by the CODM are EPRA NRV, EPRA NTA and EPRA NDV. These measures reflect the current market value of trading property owned by the Group rather than the lower of historical cost and net realisable value. These measures are considered to be a more relevant reflection of the value of the assets owned by the Group.

EPRA NRV is the Group's statutory net assets plus the adjustment required to increase the value of trading stock from its statutory accounts value of the lower of cost and net realisable value to its market value. In addition, the statutory statement of financial position amounts for both deferred tax on property revaluations and derivative financial instruments net of deferred tax, including those in joint ventures and associates, are added back to statutory net assets. Finally, the market value of Grainger plc shares owned by the Group are added back to statutory net assets.

EPRA NTA assumes that entities buy and sell assets, thereby crystallising certain levels of deferred tax liabilities. For the Group, deferred tax in relation to revaluations of its trading portfolio is taken into account by applying the expected rate of tax to the adjustment that increases the value of trading stock from its statutory accounts value of the lower of cost and net realisable value, to its market value. The measure also excludes all intangible assets on the statutory balance sheet, including goodwill.

EPRA NDV reverses some of the adjustments made between statutory net assets, EPRA NRV and EPRA NTA. All of the adjustments for the value of derivative financial instruments net of deferred tax, including those in joint ventures and associates, are reversed. The adjustment for the deferred tax on investment property revaluations excluded from EPRA NRV and EPRA NTA are also reversed, as is the intangible adjustment in respect of EPRA NTA, except for goodwill which remains excluded. In addition, adjustments are made to net assets to reflect the fair value, net of deferred tax, of the Group's fixed rate debt.

Notes to the preliminary financial results continued

Total Accounting Return (NTA basis) of 2.6% is calculated from the closing EPRA NTA of 298p per share plus the dividend paid of 7.55p per share in the year, divided by the opening EPRA NTA of 298p per share.

These measures are set out below by segment along with a reconciliation to the summarised statutory statement of financial position:

2025 Segment net assets

2025 Reconciliation of EPRA NAV measures