LondonMetric earnings rise, but NAV slips

FTSE 250-listed investment group LondonMetric Property’s interim earnings and dividend increased, but its net asset value slipped as it focuses on the distribution sector.

The company said while the political outcome remains uncertain, “investors are being increasingly discerning in their stock selection and more accurately pricing the underlying real estate fundamentals of security, longevity and growth”.

For the six months ended 30 September, EPRA earnings increased 8% to £25.3m, or 4p per share, compared to the same period last year, while net rental income also rose 8% to £39.7m.

The dividend per share rose 3% to 3.6p and a second quarterly interim was declared of 1.8p. The dividend cover increased to 112% with further growth expected in the final quarter.

The EPRA net asset value slipped to 143p from 147.7p. Its portfolio is valued at £1.48bn a fall of 1.1%.

The £23m portfolio revaluation deficit contributed to a £13.1m loss during the six months, compared to a £64.3m profit last year.

The company has a property total return of 1.5% compared to 0.2% from the index from the Investment Property Databank.

During the year £78.4m worth of retail assets were sold, which reduced the retail park weighting to 16.8%, while it gained £32.2m of last mile warehouse investments with a further £47.2m acquired after the end of September.

About £4m on new income was secured from completed developments, with £2m coming from 11 lettings and 22 rent reviews.

The company’s finances were strengthened by £130m private debt placement. It has net debt of £590.7m, undrawn facilities of £183.8m and a debt maturity of 5.7 years at an average cost of 3.3%.

Chief executive Andrew Jones said: "We continue to focus on compounding our long and strong income and value highly the repetitive, reliable and secure nature of our rents which gives us confidence to deliver dividend progression.

"Our income is structurally supported by our investment in the winning sectors and we continue to draw on our deep occupier relationships to make the correct investment decisions and create value. We have continued to sell down our mature retail parks and have further sharpened our focus on the distribution sector which offers higher growth opportunities. In particular, we have grown our 'last mile' distribution portfolio where we are capitalising on attractive demand/supply dynamics arising from consumer delivery demands for instant gratification."

Shares in LondonMetric Property were down 0.89% to 144.50p at 0836 GMT.