Segro NAV, profit up in first half

Segro posted a 5.4% rise in first-half net asset value per share and a 23% jump in adjusted pre-tax profit on Tuesday.

In the six months to the end of June, the company's net asset value per share rose to 504p, driven by a 4.9% increase in the value of the portfolio, due primarily to development and asset management gains as well as yield compression.

Meanwhile, adjusted pre-tax profit rose to £91.2m from £74.2m in the first half of last year, reflecting the acquisition of the Airport Property Partnership portfolio, development-led growth and the group's focus on customer and portfolio management.

The interim dividend was lifted to 5.25 per share from 5p the year before.

Segro said that a successful £557m rights issue during the period has created significant capacity for growth. Three quarters of the proceeds have already been deployed or allocated to specific investment opportunities, including taking full ownership of the APP portfolio of industrial property at and around London's airports.

Chief executive David Sleath said: "Segro has delivered another strong set of results in H1 2017, underpinned by active development and asset management as well as further portfolio valuation growth.

"Whilst political and economic uncertainty has increased in the UK, we are encouraged by the continued leasing momentum across our portfolio. Furthermore, business confidence in Continental Europe has picked up in recent months and there is no sign of any slowdown in the growth of internet retailing which is an important driver of demand for modern warehouse space across our markets, both in big boxes used for logistics and smaller, urban warehouses used for last mile delivery. With few signs of any meaningful new supply of speculatively developed space and investor appetite for good quality warehouse assets remaining strong, our business is well-placed to continue outperforming the wider market."