Sirius Real Estate pleased with 8pc full-year rental growth

The FTSE 250 company said that performance in the 12 months ended 31 March reflected its ability to capture rental growth in the current inflationary environment.

It reported like-for-like rent roll growth of 7.7%, making for the ninth consecutive year of like-for-like rent roll growth above 5%.

The firm, which was expecting to deliver full-year results in line with market expectations, said its cash collection remained robust, with over 98.5% on a rolling 12-month basis.

In Germany, rental rates grew in line with the rent roll, reflecting stable occupancy rates in the country.

In the recently acquired UK business, BizSpace, Sirius said it successfully firmed rates to position its assets for better long-term returns.

Rent roll growth in the UK was in line with the group level, and rental rates increased “well in excess” of inflation.

The company ceded a small amount of occupancy in return for higher rates, which it believed positions the business well to take advantage of any recovery in the macroeconomic climate.

Sirius said its balance sheet remained strong, with cash reserves at year-end of €123m and around 90% of its debt maturing in excess of three years.

The group successfully re-financed its Berlin Hyp €170m facility at a 4.26% interest rate for a seven-year term, which from November would take the overall weighted average group cost of debt to 1.9%.

Sirius also noted that acquisitions and disposals were largely matched, with approximately €45m of each.

Acquisitions focussed on Germany, where the group used its operating platform to continue to drive value.

The disposals strategy remained opportunistic, with a focus on non-core or mature assets with little upside, where the group could achieve returns in excess of book value.

Sirius said it achieved a 25% combined premium to book value on the six disposals completed during the last 12 months.

“Against a challenging market backdrop during the year, Sirius has delivered another period of strong operational performance,” said chief executive officer Andrew Coombs.

“The group expects to deliver results for the financial year ended 31 March in line with market expectations, and I look forward to the announcement of our fully audited results on 5 June.”

At 0852 BST, shares in Sirius Real Estate were down 0.12% at 81p.

Reporting by Josh White for Sharecast.com.