Sirius Sirius Real Estate

Strong operational results drive FFO and dividend growth

 

 

Strong operational platform continues to drive rental and FFO growth

•    11.7% increase in total revenue to €156.5m (30 September 2023: €140.1m)

•    14.9% increase in total annualised rent roll and a 5.5% increase in Group like-for-like annualised rent roll (30 September 2023: 7.7%)

•    5.8% increase in like-for-like annualised rent roll in Germany to €129.6m (30 September 2023: €122.5m) and 4.9% in the UK to £51.6m (€61.81m) (30 September 2023: £49.2m (€58.91m)) demonstrating continued improvement of the assets and occupier demand

•    14.5% growth in funds from operations2 (FFO) to €60.7m (30 September 2023: €53.0m) demonstrating continued strong operational performance

•    13.7% increase in Net Operating Income3 (NOI) to €92.4m (30 September 2023: €81.3m)

•    53.8% increase in profit before tax to €61.2m (30 September 2023: €39.8m)

•    17.0% increase in adjusted profit before tax to €58.4m (30 September 2023: €49.9m) excluding property valuations

•    0.5% decrease in adjusted earnings per share, which excludes valuation movements as well as other expenses not included in FFO, to 4.19c per share (30 September 2023: 4.21c) reflecting the dilutive effect of the equity raises in November 2023 and July 2024 pending the making of new acquisitions

•    2.0%4 increase in dividend per share to 3.06c (30 September 2023: 3.00c)

Valuations underpinned by income

•    1.2% increase in adjusted net asset value3 (NAV) per share to 112.49c (31 March 2024: 111.12c per share)

•    Increase in owned investment property to €2,349.0m (31 March 2024: €2,186.7m), of which Germany contributed €65.5m and the UK €96.8m, including a €11.5m valuation uplift in Germany and €7.9m valuation reduction in the UK

•    Group EPRA net initial yield of 6.9% (31 March 2024: 6.8%) with Germany and the UK stable 6.3% (31 March 2024: 6.3%) and 8.8% (31 March 2024: 8.8%) respectively

•    Like-for-like Group occupancy remained stable at 84.1% (30 September 2023: 84.2%) with Germany increasing to 83.6% (30 September 2024: 83.3%) and the UK decreasing to 86.6% (30 September 2023: 88.3%)  

•    4.4% increase in Germany in like-for-like average rental rate to €7.39 per sqm (30 September 2023: €7.08 per sqm) and 7.0% increase in the UK to £14.78 per sq ft (€15.871 per sqm) from £13.81 per sq ft (€14.331 per sqm) at 30 September 2023

Strong balance sheet and acquisition firepower

•    €174.6m in equity raised (net of costs) in July 2024 and an additional €59.9m from its €300m 1.75% bonds due November 2028 to provide fire power for the Company’s acquisition pipeline

•    Weighted average cost of debt remained stable at 2.1% in the period (31 March 2024: 2.1%) with a weighted average debt expiry of 3.5 years (31 March 2024: 4.0 years)

•    Net LTV of 30.5% (31 March 2024: 33.9%), including cash at bank of €297.6m (31 March 2024: €214.5m)

•    Fitch reaffirmed its BBB investment grade rating with “Stable Outlook” on 31 October 2024

Successful Acquisition Programme

•    €141.5m invested in acquisitions at attractive net initial yields across Germany and the UK since 1 April 2024, with €126.1m invested in the period of which €90.1m invested in the UK and €36.0m in Germany. Post balance sheet, the Company invested €3.8m in the acquisition of a strategic land parcel near its Oberhausen asset in Germany and €11.6m in the acquisition of a business park in Carnforth, UK for a total investment of €15.4m in the period.

Outlook

•    Through its strong balance sheet and extensive operating platform, Sirius remains well positioned to take advantage of opportunities to make accretive acquisitions.

Commenting on the period, Andrew Coombs, Chief Executive Officer of Sirius Real Estate, said:

“Sirius has continued to deliver robust performance over the first six months of the financial year, achieving like-for-like rent roll growth well in excess of inflation and a 14.5% year-on-year increase in FFO. This has underpinned our decision to make our 22nd consecutive dividend increase and is testament Sirius’ proven ability to drive organic growth through intensive asset management initiatives, reinforced by resilient occupier demand for space within our portfolio, alongside the contribution from a series of well-timed acquisitions.

 

“The equity and bond financings during the period demonstrate continued support from shareholders and debt partners to finance the Company’s operations throughout the property cycle. With nearly €300m of cash and a healthy net LTV ratio of 30.5%, we have significant sufficient firepower to act opportunistically and make earnings accretive acquisitions as they arise, reinforcing our ability to continue delivering strong returns and a progressive dividend for our shareholders.

 

“Whilst mindful of an evolving political landscape in our two markets, the Company’s outlook remains positive: our dynamic business model, diversified offering and strong cash position mean we are ideally positioned to continue building scale. There remain a number of levers at our disposal that can be pulled to unlock value and grow rental income within the current portfolio which, combined with an active asset recycling programme and the ability to fuel our pipeline, provides us with confidence in our prospects.”

 

Notes:

*Group rent roll and rental income KPI’s have been translated utilising a constant foreign currency exchange rate of        GBP:EUR 1.1970, being the closing exchange rate as at 30 September 2024.

** Including leased investment properties

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