Schroder Real Estate has published results for the year ended 31 March 2015. The NAV total return for the year was 24.4% which includes an 18.7% capital uplift in the NAV to 57.7p. In addition the NAV has risen further in Q2 2015 to hit 59.1p. The dividend for the year was 2.48p (down from 2.74p) which was fully covered by earnings. The share price total return was 26.4%.
The underlying property portfolio delivered a return of 20.8% – ahead of the IPD return of 17.1%. They have reported a reduction in the portfolio void rate as a percentage of rental value from 11.7% as at 31 March 2014 to 9.2% as at 30 June 2015.
They made ten sales from the portfolio, raking in £73.8m at prices that averaged at a 45% premium to 31 March 2014 levels. they reinvested this money and additional equity raised in seven acquisitions totalling £124.5m.
The loan to value at the end of the period was 22.4% as compared to 37.8% at the same time the previous year. The debt comes via a single loan of £129.58m from Canada Life at a fixed interest rate of 4.77% per annum 20% of which matures in April 2023 and 80% in April 2028, resulting in a weighted duration of 12 years. Adjusted for activity since the year end, the current net loan to value ratio is 28.5%, in line with the long term target range of 25% to 35% and below the level expected at the start of the year due to the growth strategy and rising property values. They say this provides the opportunity to consider using a small amount of additional borrowing tactically to fund activity before being refinanced by potential equity issuance.
SREI : Schroder Real Estate beats IPD index