Unite Group profit up 250%

More beds and more students paid off for the Unite Group in 2015, with the company reporting some seriously good growth in the year to 31 December 2015 on Tuesday.

Real Estate Investment & Services

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0.58%

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The FTSE 250 developer and manager of student accommodation saw EPRA earnings increase 84% during the year to £61.3m, from £33.3m. Excluding the yield-related element of the Unite Student Accommodation Fund (USAF) performance fee, adjusted EPRA earnings were up 49% to £49.5m.

EPRA earnings per share were up 66% to 28.6p, from 17.2p. Excluding the USAF performance fee, they were up 34% to 23.1p.

Unite reported like-for-like rental growth of 3.8% for the full year. Its EPRA net asset value per share was up 33% to 579p.

IFRS profit before tax for the year increased 258.3% to to £388.4m, from £108.4m.

"2015 was another year of strong performance for Unite Students. We have continued to deliver against our consistent, focused strategy and as a result remain well placed to benefit from strong market fundamentals in the UK student accommodation sector," said Unite Group chief executive Mark Allen.

"Looking forward, we continue to see opportunities to grow our business in a way which will enhance both financial returns and portfolio quality. The keys to this will be leveraging our valuable, market leading brand and scalable platform coupled with continued discipline in our investment and development activities," he added.

During the year, Unite's operational portfolio increased to 46,000 beds valued at £3.8bn, from 43,000 beds valued at £2.9bn. The company's share in each year was £1.8bn and £1.5bn respectively.

Its development portfolio increased to 6,800 beds valued at £230m, up from 6,700 beds at £114m.

Looking ahead, planning consents were in place or well-progressed for all 2017 projects, including 2,300 beds, and the secured 2018 pipeline was progressing well at 1,400 beds so far.

The company's net debt was broadly flat through the year at £731m, from £697m, with a reduction in see-through loan-to-value ratio to 35%, from 43%.

Unite Group's board announced a final dividend of 9.5p, up from 9p in 2014, and taking the full-year dividend to 15p, up from 11.2p. When combined with the net asset value per share, total return for the year was 37%.