LXi REIT pleased with full-year performance

The FTSE 250 real estate investment trust reported a total net asset value return of 18.2%, comprising net asset value growth and dividends paid during the year.

Since its initial public offering, the group said it had delivered an annualised total net asset value return of 11.2% per annum, well ahead of its medium-term target of 8%.

The portfolio was independently valued at £1.54bn, reflecting like-for-like growth of 10.5% in the year.

LXi said the growth was “broadly spread” across sub-sectors with foodstores and essentials seeing like-for-like growth of 10.2%, industrial assets of 18.5%, hotels of 4.3%, and healthcare of 4.2%.

Car parks saw like-for-like growth of 3.4%, Drive-through coffee of 9.2%, pubs of 10.4%, and garden centres of 9.9%.

The company reported a loan-to-value ratio of 22%, with “significant headroom” to its medium-term borrowing policy cap of 35% and banking covenant of 50%.

Adjusted earnings per share slipped to 7p from 7.5p, with the fall put down to the “significant increase” in scale of the group's capital base during the year, but still representing 1.17x dividend cover.

Dividends paid and declared for the 12 months ended 31 March totalled 6p per share, up 8.1% on the prior year.

Gross equity proceeds raised in the year totalled £354m, which was fully deployed into a pre-identified pipeline of accretive assets that the board said would further strengthen the group's portfolio.

“This has been another transformational year for the group, delivering increased scale and diversification, with £354m of new equity raised and fully invested, as well as a strong financial performance with an 18.2% total net asset value return,” said chairman Cyrus Ardalan.

“Geopolitical uncertainty, as well as the cost of living crisis and inflation, have meant that global markets remain volatile and interest rates continue to rise but I am comforted by the defensive and robust platform that the group enjoys through its diversified long-let assets, high quality tenant operators and inflation-linked rents.

“My fellow directors and I believe that the proposed merger with Secure Income REIT brings together two complementary long, inflation-linked portfolios whilst maintaining the conservative and highly attractive investment case that our shareholders have benefitted from since IPO as well as the defensive scale that will support the group in navigating the existing uncertainty.”

At 1031 BST, shares in LXi REIT were up 0.51% at 146.14p.

Reporting by Josh White at Sharecast.com.