SHED QD Newswire - HY results analysis from
QuotedData
7 November 2024
•
Urban Logistics REIT (SHED) has reported
half year results for the six months to 30 September 2024 this
morning. EPRA net tangible assets (NTA) was down 1.4% to
158.05p over the period, primarily due to costs associated
with asset acquisitions. NAV total return for the period was
1.3%.
•
The value of the company's portfolio of
mid-box urban logistics assets increased to £1.14bn (from £1.10bn
at 31 March) due to acquisitions and a 0.2% like-for-like valuation
uplift over the six months. The portfolio ERV grew 3.5% in the
period, while the yield moved out slightly to 6.4% (from
6.3%).
•
Management has taken strides to achieve
full coverage of its 7.6p annual dividend, with asset management
initiatives, portfolio recycling, and debt refinancing all feeding
through to a 3.5% uplift in adjusted earnings per share in the six
months to 3.57p (annualised 7.14p).
•
Chairman Nigel Rich said: "We firmly
believe that the best method for delivering value for our
shareholders is through the active management of the portfolio, the
delivery of earnings accretive acquisitions and the demonstration
of the portfolio value through sales where asset management has
been completed. This will lead to a growth in earnings, allowing us
to fully cover and, in due course, grow our dividend, and support
valuation growth in our portfolio. It is these activities, combined
with our continued belief in the single let logistics sector and
strategy, that we believe will help reduce the discount at which
the shares currently trade at, and grow shareholder
value."
QuotedData's view: The manager has
made encouraging steps in delivering on its priority to grow
earnings and achieve a fully covered dividend. Capturing rental
growth within its portfolio, where it attained a 21% uplift in
rents on lease events in the period, is the manager's
bread-and-butter. It is also undertaking an asset recycling
programme, under which it acquired four properties in the six
months, utilising capital released from the refinancing of a
portion of its debt.
Further portfolio recycling can be expected, and
post period end the company sold a 'core' asset for £7.7m at a
4.65% net initial yield and bought a vacant asset in Dunstable for
£3.6m, where the manager completed a letting between exchange of
completion resulting in a net initial yield of 7.1%. If this
blueprint can be replicated, the positive impact on earnings will
go a long way to achieving a covered dividend.
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