Sirius Sirius Real Estate

Continued sustainable FFO growth with strong operational performance driving tenth year of increasing dividends

 

Operating platform continues to drive rental and FFO growth

  • 7.9% increase in Funds from Operations (“FFO”) to €110.2m (2023: €102.1m and a 14.6% increase in adjusted profit before tax to €110.0m (2023: €96.0m).
  • 7.2%* like for like rent roll growth to €188.7m* (2023: €176.0m*) driven by continued strong organic growth and occupier demand in Germany and the UK
  • Profit before tax increased 32.4% to €115.2m (2023: €87.0m) primarily as a result of €12.4m valuation gain in 2024 compared to a €9.8m deficit in the previous financial year.
  • 2.4% increase in FFO per share to 8.95c (2023: 8.74c)
  • 8.7% increase of EPRA EPS to 8.21c (2023: 7.55c)

Sustainable FFO growth supports 20th progressive dividend payout

  • Progressive H2 dividend of 3.05c per share (2023: 2.98c per share), amounting to a 6.5% uplift in the total dividend for the financial year to 6.05c (2023: 5.68c)

Income driven valuation gains

  • Investment properties valued** at €2,210.6m (2023: €2,123.0m)
  • €12.4m net portfolio valuation increase in spite of valuation yield expansion
  • Portfolio gross yield of 7.5% in Germany (2023: 7.3%) with a net yield of 6.8% (2023: 6.5%) alongside a 14.1% gross yield (2023: 13.2%) and a net yield of 9.9% (2023: 9.3%) in the UK, on a like for like basis
  • EPRA NTA per share increasing by 1.6% to 109.82c (2023: 108.11c) demonstrating the resilience of the portfolio
  • Adjusted NAV per share increased by 1.8% to 111.12c (2023: 109.21c)

Significant market opportunity captured with €157.8m of acquisitions and €59.7m of disposals, at a premium to book value, supported by €165.3m equity raise

  • Net of costs, the Company notarised or completed six UK acquisitions amounting to £90.0m (€104.2m) contributing an annualised NOI of £8.7m (€10.1m) at an average gross yield of 9.5% and 81.1% occupancy. In Germany, the Company notarised or completed €53.6m of acquisitions across three transactions at an average gross yield of 10.2% and 91% occupancy, fuelling future rental growth
  • €56.2m of disposals in Germany with annualised NOI of €3.4m and limited further growth opportunity completed across three transactions and one £3.0m (€3.5m) disposal in the UK with an annualised NOI of £0.2m (€0.2m), all at premium to book value

Strong balance sheet with capacity for acquisitions and only 2.9% of total debt expiring within next 2 years

  • Cash at bank of €214.5m, providing capacity for further acquisitions and investment (2023: €99.2m)
  • 9% net LTV (March 2023: 41.6%) and Net Debt to EBITDA of 5.6x
  • Successful issuance of €59.9m bonds post balance sheet, via a tap issue of its €300m 1.75% notes due in 2028
  • €170.0m facility with Berlin Hyp AG and €58.3m Deutsche Pfandbriefbank facility have been refinanced to 2030 at 4.26% and 4.25% respectively

Outlook

  • The Company is trading in line with management expectations in the new financial year
  • Sirius continues to assess further growth options in both Germany and the UK on an opportunistic basis, including recycling of mature assets and reinvesting in value-add opportunities
  • Organic growth opportunities remain strong in both markets

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

“Sirius has delivered another very positive set of annual results, with a strong operational performance driving FFO, valuation and dividend growth in what represents our tenth year of annualised rental growth above 5% and dividend increases. This is testament to our platform’s ability to drive substantial organic growth, which is underpinned by continued occupier demand for our high-quality and affordable products despite macro headwinds.

“Following our oversubscribed equity fundraising of €165.3 million in November 2023, we have rapidly executed on our pipeline of attractive asset acquisitions in both Germany and the UK, taking advantage of market conditions with c. €160 million of assets bought in the past six months. At the same time, we have maintained a healthy net LTV ratio and have recycled capital with c. €60 million of disposals completed at a premium to book value, highlighting the business’ ability to crystallise returns from our mature assets and to drive value where we see strategic market opportunities. 

 “Looking ahead, our outlook remains positive: our active asset recycling programme, strong cash position and post balance sheet issuance of €59.9 million of debt means our balance sheet is in rude health. There remain many levers we can pull to unlock value and grow occupancy and rental income within our current portfolio through our successful asset management programme, and we remain well positioned to fuel our accretive pipeline, supporting our next phase of growth and deliver attractive returns for shareholders.”

 

Notes:

*Group rent roll and rental income KPI’s have been translated utilising a constant foreign currency exchange rate of        GBP:EUR 1.1695, being the closing exchange rate as at 31 March 2024.

** Including leased investment properties

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